Why Did Johnny Hanna Step Down As Homie CEO? Johnny Hanna of Utah-based real estate company Homie announced during the Silicon Slopes Summit last Friday that he would be stepping down as CEO of the company.
His announcement to step down followed a week in which 40 employees at Homie were laid off, according to a statement from the company.
“As the real estate market continues to shift, Homie was forced to evaluate the current business structure and let go 40 team members last week,” the statement said.
Joe Grover, former chief marketing officer and current adviser for Homie, said the layoffs are “in between 15 and 20” percent of Homie’s workforce.
Why Did Johnny Hanna Step Down As Homie CEO?
In February, Homie announced that it would be laying off 119 employees, reducing its workforce by some 28% amid unprecedented conditions for homebuyers and sellers in Utah and around the country.
As of Monday, Mike Peregrina, who co-founded Homie with Hanna and currently serves as the company’s president, will be the new CEO of the company.
“Although the (real estate) market is going through a cycle, I’m excited to step into the CEO role at Homie. We have an incredibly talented and committed team. I’m looking forward to continuing my work with Johnny as chairman in our mission to bring equity and change to real estate,” Peregrina told KSL.com Tuesday.
Grover said Peregrina and Hanna worked closely together in the day-to-day operations of the company and he expects the transition to be “pretty seamless from a management standpoint.”
“They’ve always worked together as a team — kind of two in a box — working, you know, to operate the business and manage all aspects,” Grover said. “Mike is in a great position to lead the company. … Right now is a difficult time in real estate and as we really look at efficiency and driving the business all the way to profitability, it makes sense to have a more, kind of, focused and nimble executive team.”
Grover noted that Homie is still operating in all five of the markets — Arizona, Colorado, Idaho, Nevada and Utah — that it was prior to the leadership change.
“We’re still the largest listing broker in the state of Utah and we continue to operate here,” Grover said.
Hanna will continue serving as the chairman of Homie’s board of directors, which still constitutes a “pretty active role in moving the company forward,” Grover noted.
How Johnny Hanna co-founded Entrata and Homie
y mom and dad divorced when I was seven, and I spent my school years growing up in the diverse community of Pueblo, Colorado. I loved playing basketball and competing―basketball was life―I really thought I’d play in the NBA someday. Unfortunately, I was 5’9”, 145 pounds, and surrounded by kids taller and more athletic than I was.
Despite my lofty ambitions, I got cut from the basketball team my senior year. It was devastating and I was blindsided. It was like the world said to me: “you’re worthless.” But the sting of being cut drove me to play more basketball, not less. In a humorous turn of fate, I hit a growth spurt after being cut. I was now 6’3” and 200 pounds and would have been one heck of a high school guard or forward. So with my new height and physique, I tried out for my college basketball team. I didn’t make it.
When I wasn’t shooting hoops on the blacktop in Colorado, I spent my summers bailing hay on a ranch in Montana with my dad. It was hard work, and It taught me a lot. My dad was all about grit and toughness, so my worth was tied to the number of bales I bucked and the number of calluses on my hands. Ironically, I was also allergic to horses and hay. First, my basketball career was in question, and now I couldn’t even succeed at ranching!
I started school at Ricks College in Rexburg, Idaho. With basketball and ranching checked off the list for future careers, I decided to try my hand at student government and ended up running for student body president every year of college. And though I lost the election three years in a row, I was appointed to VP of student activities, a key position in the student government where I developed an ambition and love for leadership that has stayed with me ever since.
Upending property management
I started my first company with my college buddies right before graduation. My co-founder’s wife was a property manager, and she was always sharing the headaches associated with property management. He came up with an idea to build a software company that would streamline the whole process for her. Property Solutions was born.
Property Solutions rebranded to Entrata many years later. Though it seems like a Cinderella story thanks to its recent funding announcement of $507 million, we had our ups and downs like any business. A lot of our challenges were self-inflicted wounds due to a lack of focus on culture. There were many times when I questioned if we would make payroll. Like anything, nothing came easy, and we had many mountains to climb.
Early on, I was selling a product that didn’t exist yet. At the time, my partner said, “Hey, just sell it, and I’ll build it.” And I did just that. Unfortunately, it was taking extra time to complete the development, and I kept saying, “Oh, it’s coming. It’s coming.” I even sent an email to my partner saying, “Hey dude, should I keep leading this lady on? Are you ever gonna build this thing?” And I accidentally sent it directly to the client, who was a well-known influencer in our industry.
I knew I made a massive mistake with far-reaching implications, but the biggest mistake wasn’t adding the wrong recipient in the send line. The biggest mistake was not being 100 percent truthful in what we were selling and promising. I owned the decision, re-earned her trust, and most importantly, learned to never compromise my integrity for anything, despite the size of the deal or contract value. That lesson was incredibly embarrassing, but I vowed to keep growing and ended up using that example with my sales team of what not to do for the rest of my 12 years at Entrata.
Starting Entrata with some of my friends was an amazing experience, but one random night into my tenure, I told my wife that I thought it was time to do something different. I had no idea what was next—I just felt like it was time for a new challenge. Two days later, I mustered the courage to tell my co-founders I would be stepping away. I think it was kind of a shock for them―they really couldn’t tell if I was being serious or not, and the whole thing felt surreal.
Walking away from a successful business I started as a 24-year-old college kid took a tremendous amount of courage. Looking back, I’m not sure how I was able to make that decision as quickly as I did. I was scared, and I second-guessed myself, but I kept believing.
Changing homeownership for the better
On my last day at Entrata, I happened to meet my next co-founder, Mike Peregrina (aka Hustle). He had a crazy idea to upend the traditional real estate system and rework the business model in favor of the consumers. If there was a bigger challenge than what I had done at Entrata (maybe even bigger than making it to the NBA), this was it.
At the time, Homie was just an idea and a slide deck―it was hard to decide if I wanted to commit. I knew it was the least likely to succeed out of all my options, and I was uncertain about moving forward. Eventually, I decided to jump in because it was an opportunity to disrupt an industry yet to be disrupted. I thought the mission was one worth fighting for. We agreed that we would never stop innovating until everyone, regardless of who they are or where they come from, has the opportunity to own a home.
The Homie business model is different today than it was on that day in 2015 when I met Hustle, but the mission has been clear and consistent since day one. We wanted to make the whole process of buying and selling homes more affordable by cutting out all the extra fees and commissions. We also wanted to simplify the process by streamlining everything under one roof and building everything in a single app.
Though we had a great idea, the backlash, headwinds, and resistance from the already-established real estate industry were greater than we could have imagined. So much so that we dealt with heavy fines, slander, and even threats to throw me in jail. With almost 20,000 real estate agents in Utah that weren’t fans of our business model, complaints were made to the Division of Real Estate with every transaction we closed. It was a challenge that didn’t seem to have a solution. I was terrified but kept fighting to make the idea a reality.
There was a moment in our company’s history that forced a critical pivot. We believed that Homie didn’t need agents and that most of the buying/selling process could happen on your phone. While this vision is exciting, it was premature. Our customer satisfaction scores were tanking, and the industry declared that Homie would be a fad, destined for collapse.
So I called every customer that was having a bad experience one by one, every day, day after day. I quickly identified that these people wanted a more economical way to buy and sell, but they still needed an expert’s support. At the time, our issue was that we weren’t picking up the phone, and we had prioritized efficiency over support via our app. I felt their pain.
Our intent to disrupt the industry was eclipsing our intent to make our customers’ lives easier and their dream of homeownership more attainable, so we really needed to disrupt our way of thinking. We needed to humble ourselves enough to redraft the blueprint we had created for our business, so we decided to offer dedicated real estate experts to guide each client through the process.
It proved successful. As we recentered around our customers’ needs for expert support, our company began to grow again—one market, two markets, three markets, and then five. We began to expand to other services, including mortgage, title, and insurance. But through all of this success, the backlash from our competition continues. Every innovation is met with resistance. It would be much easier to quit and let our industry peers get satisfaction from our failed attempt at disruption.
The fact is, failure only happens when you stop leading, stop selling, stop growing, and stop innovating. No entrepreneur will ever argue that resilience is one of the primary ingredients in the recipe for startup success. And while the Jazz hasn’t worked me into their starting lineup yet, and Homie hasn’t sold homes in every city and country in the world, I have learned that my success is less about early childhood dreams and much more about never giving up. Success is about overcoming obstacles; it’s about staring at the biggest challenges in the face with that same grit and toughness my dad taught me while I was bucking bales until midnight.
After all, if this kid from Pueblo, Colorado and small-town Montana can be the CEO of a venture-backed technology startup that is changing real estate forever, then anyone who keeps on going can find their own success. Even if it was different than what they imagined on the blacktop.
