No. 1 small company: Rose City Mortgage

RoseCityMortgage.jpgWhen you walk into the office of Rose City Mortgage, it has the warm embrace of home. CEO Renee Spears pads around in her socks and sweats, good-luck Buddhas are sprinkled about and dogs are nearby.

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When you walk into the office of Rose City Mortgage, it has the warm embrace of home. CEO Renee Spears pads around in her socks and sweats, good-luck Buddhas are sprinkled about and dogs are nearby. The kitchen is right off the light-filled office and everyone has free use of the fridge. Spears even vacuums the floors every morning before her loan officers show up.

It feels a lot like home because it is.

Ten years ago, Spears started Rose City Mortgage out of this two-story house on a wooded cul-de-sac in Portland. She fashioned it as the first socially responsible mortgage company, one that put relationships before profit, showed respect to all people, valued sustainability and supported the local economy.

RoseCityMortgage.jpg From left: Ericka Heidrick, Jen Bell, CEO Renee Spears and Jake Planton hold a staff meeting in the living room of Spears’ home. Rose City Mortgage’s office moved there late last year to cut overhead costs.


When the business took off, she moved first to a small office and then four years ago into 5,000 square feet on Macadam Boulevard that cost her $8,000 a month. At its height, the company had 25 employees and closed $258 million in residential home loans in one year. This past fall, as the housing sector crumbled and the economy tanked, the CEO downsized her company and brought it back home.

“Last year, all of us in the company had to take stock,” says Spears. In one day, with 14 loans pending, one of their biggest lenders, American Home Mortgage, went out of business. Over the fall and winter, six loan officers left and one was laid off. “We had to ask, ‘Who are we?’ Are we just the office space? No. Our company is the people.”

Spears and her slimmed-down staff — a salaried office manager and 11 commission-only loan officers — understood their culture wasn’t embedded in their lovely Macadam office, it was inside them. So they have easily ditched the yoga room and spacious digs because it isn’t the walls and the rooms that define them. They’ve been a 100 Best Company three times and the collapse of their industry isn’t going to change how they feel about working at Rose City.

They brought their green ways with them, including the worm composter (dubbed Wormvana) and their paperless office procedures, and the rest of their values. At the new home office, the deck is open for meditation and anyone can use the hot tub. Dogs and kids are still welcome (in fact, Spears’ two grown children still live there), and the beverages are in the fridge. Flex time and telecommuting are SOP; the employees take whatever time off they want and set their own schedules. “I have good people who are workaholics,” says Spears. “It tends to regulate itself.”

The Rose City team knows who they are and what keeps them motivated and happy in their high-stress, high-turnover world. Since the move, the loan officers rotate working out of Spears’ home, telecommuting the rest of the time. To keep connected they have a staff meeting once a month and another one offsite where lenders can pitch them their business. At a recent gathering at a local pub, Spears orders the beer and the rest of the team finds it easy to describe why they find Rose City a great place to work.

“We’re human beings,” says Ericka Heidrick. “Not just a ‘worker.’’’

“There’s no hierarchy here,” adds Robert Bowles. “You feel like family the first day.”

“It almost seems too good to be true,” says Jamie Gordon.

These things are work-life rosary beads to them, counted in gratitude each day.

ReneeSpears.jpg RoseCityMortgage3.jpg
Above: CEO Renee Spears sets the tone wearing sweats to work. Middle: Loan officer Jen Bell at one of the workstations in the office set up in Spears’ home. Bottom: Jennifer Lee Kwai and Jake Planton share a laugh during the work day.

It’s a tight-knit group, easy with one another and their boss. Spears even gets described as “mom,” though at 44, and 10 to 20 years older than her staff, she seems more best friend forever or cool college RA. She is low-key and laughs easily and if she carries any tension around, it must be stuffed deep inside the pockets of her comfy sweater. When someone is troubled, Spears knows when to talk. When it’s rough going, she finds ways to focus on what matters. Before a staff meeting in the doom of last September, she asked everyone to write something positive about one another. Then at the meeting those warm words were showered over the team.

“I save that paper and each time I wonder if I am in the right business, I reflect on my co-workers,” says James Komro, “and know that we are all in this together and will be just fine.”

The Rose City culture and its values are central to keeping the business intact. Spears didn’t get into sub-prime or FHA loans to pump her business. “We kept our underwriting standards intact,” says Spears. “Imagine that.”

Spears won’t hire anyone who doesn’t share those values. Fitting in at Rose City means caring about sustainable practices (like the worm composter), community (employees donate $100 per loan closed to a nonprofit), and diversity. Early on, word of mouth grew that Spears would not discriminate against gay couples and their efforts to get mortgages. Her mother and son are gay and five of Rose City’s loan officers are gay.

Last year, Spears received a couple of offers to sell her company. “They were slimy mortgage guys,” says Spears. “They would have turned it into every other mortgage company.” Spears was ready to step back from the company she founded, but how?

She found the answer sitting next to her: She’s selling Rose City in equal parts to her staff as of January 2010. Spears and her 12 employees will be co-equal owners and for the first year they will continue to operate out of her home with the company paying her $500 in rent each month. The loan officers will make an 80% commission on the loans they close, with 20% going to the company pool. They’ll divide the profits 13 ways and there will be no out-of-pocket expense to buy the company, which this year is expected to close $180 million in loans and make $1 million in gross revenue.

“We’ll make business decisions the old-fashioned way,” says Spears nonchalantly. “We’ll just vote. It’s 13 people, so it can’t be even.”

If there was an ounce of dissatisfaction over moving up in the ranks, dealing with the boss, or being trusted, having that boss hand you the company pretty much puts the kibosh on that. There’s a little bit of nervousness about Spears stepping back, but also excitement about becoming owners themselves. “We’ve been doing it long enough that Rose City is bigger than Renee,” says Jennifer Lee Kwai. What BFF — what mom — wouldn’t be proud?

Spears will work full-time at Rose City this year, and then spend only a third of her time there next year, when she plans to start a new company. She hasn’t picked a name yet, but she knows what she’ll do: teach other companies how to be a great place to work.

Imagine that.

ReneeSpears2.jpg Buddhas large and small are sprinkled around the Portland home of CEO Renee Spears. They were an important part of the Macadam office and now also part of the home office.

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