How to Become a Great Brokerage Without Getting Lucky

There is a famous Twitter Thread by Naval Ravikant called "How to get rich without getting Lucky" (see below).

There are many great pieces of advice in this thread that can be applicable to brokerage. I highly recommend you read the whole thread for yourself.

I remember in my early days as a carrier rep I used to think, "If only I had that massive carrier someone else has, I would be killing it."

I remember in the early days as a customer rep, I would think to myself, "If only I had that one massive customer, I would be killing it."

The truth is that one account won't make your brokerage great.

When I first started at Molo I landed a great customer. I got along with the planners and they were feeding me freight. Within three months of working with them I was averaging $30k-$40k gross margin per month. The following year they got bought. They made some internal changes, one of my favorite planners left, and suddenly the freight dried up.

Having reliable customers and carriers is the name of the game and that's how you make money. Yet every brokerage has customers and carriers and the great brokerages are few and far between.

People at a brokerage, or any business, are the most valuable assets.

Naval says, "Seek wealth, not money or status. Wealth is having assets that earn while you sleep. Money is how we transfer time and wealth. Status is your place in the social hierarchy."

In this case, "assets that earn while you sleep" are the people. People at a brokerage are everything, and in a lot of ways the only thing, that matters.

Not having the right people in place will hurt your business. People create everything from the processes to the culture. The right person can light a spark under everyone else.

You must have a leader who reps can rally around. Going to work every day becomes incredibly difficult for reps if they don't believe they are being led in the right direction.

At Molo, Andrew Silver would lead an almost weekly company-wide Zoom and would finish every meeting by asking us, "Where are we going?"

Everyone would reply, "Too the MOOOOOOOON!!!!"

Silver and Vogrich were able to cultivate a culture in which employees felt they were leading them in the right direction and the company was going "To the Moon".

Ignore people playing status games

Naval said, "Ignore people playing status games. They gain status by attacking people playing wealth-creation games."

There are a lot of folks on LinkedIn who want to be the televangelists of freight. I see LinkedIn as a powerful tool – one that is vastly underestimated by most freight people.

While you should promote your business on LinkedIn for visibility, you also need to grind and create the best systems. Don't compare yourself to other people or other brokerages. Focus on what you can do better today and improve 1% every day.

Apprenticeships

Naval says, "When specific knowledge is taught, it’s through apprenticeships, not schools."

Anyone who has worked at a brokerage knows virtually everything you need to know is taught there and not at school. There isn't a university in the world that prepares you for brokerage.

Something Coyote did so well was mentorship. Interns were placed under rep for a summer, and new full-time reps rotated between mentors

When I first started at Coyote as an intern I worked under one of the top carrier reps. He showed me how to work the phones, hustle, book freight, and ultimately win. Having that mentor is what jump-started my career.

It's vital, whether it's virtual or in person, that you get your new employees situated with their coworkers and mentor them.

Your new employees should be learning from the best while creating a path of their own. Leaving employees out on an island, and lack of training isn't going to build a great company.

Play a long-term game

Naval says, "Pick an industry where you can play long-term games with long-term people."

This couldn't be more true in logistics. Your organization needs to be long-term focused. Nickle and diming over spot loads and rates with carriers is no strategy for long-term growth.

The freight market can be incredibly volatile. A lot of freight people, from reps to leaders, can fall into the trap of short-term thinking.

The truth is cultivating external and internal relationships takes years of proving yourself reliable through a variety of market conditions.

Are you going to stick to your contracted rates with a customer once the market goes up? For most brokers, the answer is no.

One thing that separated Molo from the rest of the pack was the fact they thought long-term on all customers. They honored their rates with AB during 2020 and 2021 when the market spiked.

In 2021 Molo was awarded AB Carrier of the Year.

Molo earned a reputation as a committed carrier who never gave back a load which is what helped them scale so fast.

Knowledge is power.

Naval says, "Arm yourself with specific knowledge, accountability, and leverage."

Continuous learning in any environment is important. The more your people know the more of a difference they can make.

Your organization will function better when each department understands what the other does and its processes.

It's important for the sales/operations people to understand the carrier side and vice versa. That's why, I think people who have worked on both the carrier and sales side are so valuable.

The more everyone in your organization knows, the better off you'll be.

Learn to sell & Learn to Build

Naval says, "Learn to sell. Learn to build. If you can do both, you will be unstoppable."

1 is ok, 2 is ideal if you can't do either then what's the point? Sales drive revenue which creates profit, which keeps the lights on.

If you can sell, while simultaneously building systems and a culture that both your employees and customers believe in, you will become unstoppable.

Conclusion

Customers and carriers will keep your business alive but they won't make your organization great. It takes much more than that. You need to create a sense of belief and cultivate a continuous learning environment.

Think long-term and create lasting partnerships with customers, carriers, and most importantly your employees.

All opinions are my own and gathered from my own experience and research.