TMG looks to fill the gaps for independent brokerages

For independent mortgage brokerages, maintaining autonomy while building out areas such as compliance, technology and recruitment can be a significant undertaking.

Launched on August 25, TMG Enterprise Partners is TMG The Mortgage Group’s answer to that challenge, offering established brokerages access to enterprise-level resources while allowing them to remain independent.

“We basically set out to build something that was fresh and new, and addressed the issues that broker-owners are experiencing today,” says Mark Squire, who joined TMG in May after six years as president and COO of Verico. He is now chief operating officer of TMG Enterprise Solutions.”

“There are a lot of people that are doing a lot of things right, but there are parts of the business they don’t like to do, and naturally they’ll gravitate to the parts they like,” says Veronica Love, TMG’s chief revenue officer and president of TMG Enterprise Partners. “In this industry, you come in and get licensed, or start a brokerage, and you don’t know what you don’t know. Well, we have 36 years of knowing what they should know, and we’re willing to share it with them.”

An enterprise platform, not a traditional network

Love says the “enterprise” name reflects the platform’s broader ambitions, which she argues distinguish it from a traditional network. TMG Enterprise Partners, for example, plans to establish an executive council of participating brokerages to gather and act on member feedback.

“The other value prop that we want to bring to the table is this concept of shared expertise and strategic collaboration among the firms that partner through us,” says Squire. “There might be firms that have expertise in financial planning or U.S. lending, and we want to cross-pollinate that and share that and leverage that between the various offices.”

TMG Enterprise Partners also uses a tiered pricing model, allowing brokerages to choose the level of support they need.

“Other providers offer a one-size-fits-all solution, where it’s either a very low fee and very little support, or a very high fee and varying levels of support,” says Love. “We’re not dictating how we provide services to them; we’re asking them what meets their needs.”

Higher tiers offer more hands-on support, while brokerages in the lower tiers can access tools, guides and blueprints covering HR, growth, finance, technology, compliance, strategy, infrastructure, reporting, marketing and recruitment. Brokerages in tier three, the highest level, also have an opportunity to acquire an equity interest in TMG Enterprise Partners.

“We’re willing to share everything that we’ve already gone through in our respective roles and with the TMG family, from regulatory audits to FINTRAC requirements to cybersecurity,” Love says. “These are things that a lot of brokerages in Canada aren’t thinking about, but they need to be, and we’re here to give them the toolbox to do all of it and make their lives easier.”

Formalizing a model already in use

Although the enterprise platform officially launched on August 25, Love says the concept had been developing for years and was already being tested with a small group of partners.

“We’ve had some lead time with key partners like Mortgage Outlet and Perch — and obviously our co-brokerage partners — to know that this is working, that there’s something here that other people could benefit from,” says Love. “The formalization of Enterprise Partners has been in the works for months now, but it’s been in practice for two or three years.”

“That also gave us feedback to help model what this might look like and how we can make this effective for more offices,” adds Squire.

A focus on established independent brokerages

Love says the platform is intended for established, growth-oriented mortgage brokerages that could benefit from additional infrastructure and support while retaining their independence.

“We are looking for brokerages funding roughly $400 million to $450 million or more annually,” she says. “The shared revenue aspect comes into play with much, much larger brokerages than that, but we’re looking for people that are well-serviced already, that are independent, that have the volume and the status but there are gaps, and we can work to fill those gaps.”

Love notes that TMG already offers a co-brokerage model for firms requiring more direct support. The enterprise platform is aimed instead at brokerages that have succeeded independently—or recently become independent—but have identified gaps in their capabilities.

“Now they’re starting to identify that lender arrangements aren’t happening for them, or they don’t know everything they thought they knew about FINTRAC or regulatory concerns, or they don’t have the capability to do interprovincial deals,” she says. “They would have all of that capability with us because we are national in scope, and we’re leaning on the resources of TMG.”

Fees are set case by case based on each brokerage’s needs and tier. Love says pricing will be in line with industry standards and will not include royalties.

Love says prospective partners will first be shown the available services and where TMG believes they could improve profitability. “Nobody’s going to align with us unless we can help them make more money, and that’s going to be really, really important — that it’s a win for them.”

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Mark Squire TMG Enterprise Partners TMG The Mortgage Group veronica love