By Laura Baker
Everyone knows the friendly face of Mike Pero and chances are you can hum his businesses’ catchy jingles. His powerful marketing and public relations campaigns have driven this self-made New Zealand businessman to an almost iconic level.
Arguably the most successful entrepreneur in the finance industry, he holds an impressive curriculum vitae to brag about. Mike is six times New Zealand Motorcycle Road Racing Champion, a qualified motorcycle mechanic, a former airline pilot and has created and grown a number of successful businesses.
Most people will associate Mike Pero with the mortgage broking firm Mike Pero Mortgages, which has seen his face plastered across our televisions advertising the business for the best part of the last two decades. But unbeknown to most, he sold the mortgage company in 2004 and has since embarked on a number of new business ventures including the Flight Experience business, which he has also since sold.
But more recently our association with the Mike Pero brand has shifted from mortgages to real estate. It all began in 2010 when he saw a new opportunity knocking. The change of the Real Estate Agents Act of 2008 brought in new rules making it possible for someone who didn’t hold a real estate licence to set up a business – and that’s exactly what he did and Mike Pero Real Estate was born.
Leading the pack
Opening a new business is always hard, even for a seasoned entrepreneur like Mike. He says initially he gained a lot of confidence growing Mike Pero Real Estate thanks to his background and experience in running the mortgage business franchises and franchise law. But he admits it was hugely different to mortgages in a number of ways.
“It was baptism by fire in the first few months and to be fair in the first year or two there was a lot more to be learned than I anticipated; it was like diving into a PhD. It is certainly a vibrant, exciting and colourful industry and I love it so much.”
Mike Pero Real Estate launched on Valentine’s Day of February, 2011 in Christchurch, the following week the devastating earthquake hit the city destroying the proposed head office. So head office started from Mike’s three car garage at home.
He says at the time if he had the choice to change his mind and back out he would have, but he was already thoroughly invested so he pressed on through the tough times. And it’s lucky he did persist as it turned out to be, with out a doubt, the best decision he’s ever made.
“Once upon a time I thought we would only be a small boutique real estate company now I see us being a serious challenge to the legacy brands. And already we’re delivering a level of service that far exceeds the traditional models.”
Now the real estate company is growing at a phenomenal rate with a new branch opening every 32 days somewhere in New Zealand – this month there are 48 branches and Mike’s goal is to reach 60 by this time next year.
“We have branches from Invercargill to Kerikeri and our main centres are Auckland, Nelson
With shiny red real estate offices now in all corners of the country the company has experienced a welcomed flood of customers, and suffice to say its growth has significantly exceeded its three year business plan.
“We wrote a very ambitious business plan from the onset, we have now exceeded our best growth expectations by another 30 percent; we are well ahead of where we wanted to be.”
Even with the immense success the business has already achieved in its short life Mike isn’t slowing down. “We have so much more potential, I feel pretty excited as to where I sit at the moment. Looking back to 2011 I knew relatively nothing compared to what I know now and I feel pretty excited as to what the future holds over the next three to four years.”
Mike Pero Real Estate is now the fastest growing real estate business in the country. The rapid growth is down to a lot of planning, strategy, smart thinking and of course killer marketing.
The real estate business is recognised as a leader in marketing and he says it’s one of the main reasons it has caught on so quickly. Mike thinks his familiar image and the trusted brand that he’s built up over the last 25 years has largely contributed to the winning formula.
“A lot of people have grown up with the Mike Pero Mortgages television ads so they know the jingle and they know my face; I’ve met school children who can sing our jingle.
“I was a personality that was seen on TV unlike a lot of the other brands that were just faceless organisations and by putting a face to the name the trust factor went up. I’ve since transferred that trust across from mortgages to real estate and it turns out to be my most successful business that I’ve started from zero.”
Its fresh approach to real estate advertising with its ‘Property Preview’ advertising their listings on TV One and TV3 has put the company front and centre.
Despite the businesses rocky beginnings (born out of the Christchurch quakes), Mike Pero is firmly in control of his greatest business success to date. And at the expenses of sounding too pretentious he says he feels “really, really chuffed about it”.
Calling it quits
The general public perception is that Mike owns and plays an active role in Mike Pero Mortgages. His name and face associated with the brand certainly gives this impression, so you can be forgiven for making the assumption. But in fact he cut all ties with the successful national business he grew from birth a year ago.
Previous to the launch of Mike Pero Mortgages in 1991 there was no such thing as a mortgage broker in New Zealand. The businesses effectively created a whole new industry never seen before in this country.
Creating an unheard of business model meant there were a number of hurdles to conquer. He says the major challenge to overcome was educating the general public about what the role and functions of a mortgage broker were.
“When I said I was a mortgage broker people would say well what does a mortgage broker do? People were so used to going direct to the bank, so I felt for the first 10 years our marketing was about explaining what a mortgage broker is. And even in some of the commercials we still have I’m explaining what it is we do. I felt like a single person carving my way through a jungle.”
But with the help of a widespread, persistent and memorable marketing campaign his message did get through and the business became a household name. Today the franchised organisation has arranged more than $9 billion worth of loans to New Zealanders.
The mortgage company has experienced very little competition from rivalry businesses during its lifespan. He says he couldn’t believe how lucky he was that he could build a business and get a reasonable momentum before others popped up. But by then Mike Pero Mortgages had a firm grip on the industry, even today most people can’t name another mortgage broker.
So why did Mike leave the company he poured decades worth of sweat and tears into? Put simply the price was right. The offer that saw him sell Mike Pero Mortgages came in 2004, at the time he says he was focused and committed to owning and growing the mortgage company, but everything has a price.
“I had an offer that was too good to turn down to be blunt and so I sold the mortgage business for many multiples of its annual earnings.
“I could see the momentum proposed by the new owner and with the inclusion of myself as a director it provided me with satisfaction and financial rewards. I thought it was the best thing for the company going forward.”
After selling his shares in the business more than ten years ago Mike severed all ties last year resigning as a director of Mike Pero Mortgages to put his full focus into real estate.
Despite the fact he has now walked away from the mortgage business entirely Mike is still the face of the mortgage broking firm. And he says for the time being his name and face will be used for branding and marketing purposes. “However, I think over time there will be less of me.”
Moving fast forward
Becoming the fastest growing real estate brand in the country within three years is no small feat.
He says the secret to the businesses success isn’t a big secret at all; it simply comes down to planning, executing the plan and then monitoring it regularly and of course an emphasis on brand investment, plus an extraordinary amount of energy and effort.
And with those few simple ingredients he’s onto a winner. “Every business that I’ve been the CEO of has succeeded. I need to be in the driving seat. If I have control I know I can make it work.”
There’s now no doubt in Mike’s mind that the brand will supersede the heights he once thought were out of reach and in his own words “We’ve started something that Kiwi homebuyers, sellers and agents have really taken to.”