After leaving banking eight years ago to become a broker, Matt Pongrass quickly established himself as a leading broker for professionals and sophisticated investors, now averaging $2.2 million per loan. We catch up with the Sydney-based broker to uncover his strategies for building a successful brokerage with a high-touch servicing model and his plans for future growth.
Q. What made you pursue a career in broking?
I had been working in a bank for eight years, starting in accounting, moving into wealth management, and then spending six years in business banking. My family consists of entrepreneurs, and owning my own business was always a goal. My dad advised me to work for a bank first to learn how a large business operates, how to be managed, and how to manage people. I set a goal to be self-employed by 30, and two days after my 30th birthday, I quit my job. I had worked in lending for a significant period and considered becoming a broker. In 2016, I moved back home, and Certe Finance started as an offshoot of a client’s wealth business, providing a finance offering. This gave me a good foundation with an office and a lead network.
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Q. Why did you start your own brokerage rather than joining an existing one, or a franchise?
The initial agreement was that I would be 100 per cent independent, with Certe Finance as its own standalone business.
When I left Macquarie, I was strategic and cherry-picked some of my best advisors from the professional services arm, asking them to mentor me and stay in touch. One of them suggested I come in and tuck under their business.
My business partner, a former client from Macquarie Bank, had a small share, and it was a way to service their clients. Over time, I bought back his share, making the business 100 per centmine after a couple of years.
We still share the same name and office.
Q. What is your average loan size and how do you write so much business?
My average loan size last year was $2.2 million. This high average comes from being very specific about the type of clients I targeted when I started. We focused on young professionals and family offices/sophisticated investors. This strategy led to referrals from that specific client base, which then snowballed. The key is a high-touch model where I am deeply involved with clients. I know their security, loans, banks, payments, and structures for almost all my clients. This allows us to service them at a high level. We also leverage referrals by asking clients at the end of the process, once they are happy, if they have any friends, family, or colleagues they could introduce us to.
Q. How do you approach client conversion?
Typically, I handle the initial call or meeting. When we request documents, I introduce the client to one of our three relationship managers, who will be a second point of contact. Once we have all the information, the relationship manager, our credit analyst, and I sit down to discuss the high-level strategy. The credit manager then conducts more detailed research on rates and valuations. We then map out the strategy, with me remaining heavily involved, unlike some other lead brokers who step away from the granular strategy. The proposal is then delivered to the client, which is a detailed and thorough document, more comprehensive than expected, almost like a financial advice document. Once a lender is chosen, it goes to our processing team.
Q. What are the benefits of taking a team approach to handling clients?
Our team structure is unique. While many brokerages have independent brokers running their own businesses, all our employees, including the relationship managers, are aligned to one profit center. Their bonuses and commissions are tied to the overall business performance, meaning they receive a percentage of transactions. This ensures everyone is aligned with the clear goal of servicing existing clients and delivering outcomes.
Q. What would you change about the broking industry?
I believe there's a need to improve education standards and have a more structured approach to ongoing learning for brokers. This would encourage them to continuously grow and be more educated regarding the advice they provide. We give advice on significant decisions like buying property and managing debt. Particularly when discussing complex topics like debt recycling and tax, where we are not qualified to give advice, brokers need the right training on what they can and cannot say, along with a general understanding of these areas. Good brokerages thrive because they offer thoughtful advice, as selling on rate alone is unsustainable. More rigorous education would be beneficial.
Q. What’s the biggest challenge you’ve faced in your career?
The initial loneliness was a significant challenge, as you have to do everything yourself. As the business evolves, new pain points arise, such as hiring staff, whether offshore or onshore, and learning to be a manager instead of just reporting to yourself.
Managing time, especially when travelling as a sole proprietor or with staff, while maintaining a good business culture are ongoing challenges.
Most recently, becoming a first-time parent eight or nine weeks ago has made managing my time even more challenging, balancing presence at home with being present for my staff.
Q. What’s the best thing about being a broker?
I love the strategic side of the industry. It's truly enjoyable and exciting.
It's one of the few industries that offers exposure to so many different businesses and stakeholders across Australia. You get to see the performance of various small businesses, meet great directors and managers, and observe who runs their businesses well. Additionally, you meet amazing accountants, financial advisors, and lawyers. If I stepped away from that, I wouldn't love what I do.
Q: What advice would you give new brokers?
My advice to new brokers is to focus on learning, be trustworthy and honest with clients, and try to develop strong relationships with them. You need to be likable, trustworthy, and a subject matter expert. People naturally want to help, so if you service your clients exceptionally well, their friends, family, and colleagues will ask them for recommendations, leading to referrals. The lost art of simply doing a good job for someone is a key and easy way to grow your business.
Tune in to hear more!
Find out more about how Matt Pongrass and how he's building his brokerage on the Elite Broker podcast episode, here
