Transcript
00:00:00I've been in business for 14 years.
00:00:01I recently did $106 million book launch in a weekend.
00:00:03And our portfolio of companies at acquisition.com
00:00:05does over $250 million in aggregate revenue.
00:00:07And a portion of that is brick and mortar chains that we own.
00:00:10And so in this video, I'm answering your questions
00:00:12about how to scale specifically
00:00:13a brick and mortar HVAC business.
00:00:15And for all of those questions,
00:00:17I try to do my very best to make the solutions
00:00:20as tactical as humanly possible
00:00:21so that you watching from home can actually use this stuff.
00:00:24Enjoy.
00:00:24- My name is Thomas.
00:00:25I sell roofing and exterior remodeling.
00:00:27We do close to 6 million this year.
00:00:29I would like to be at a hundred million.
00:00:31What's stopping me and I'll be a little bit vulnerable.
00:00:33I would say it's comfort, distractions and fear.
00:00:38- And food?
00:00:39- Fear.
00:00:40- Oh, sorry. I was like.
00:00:40(audience laughing)
00:00:42All right. Good to know.
00:00:43(laughing)
00:00:45Sometimes I feel that way too.
00:00:47- So the comfort is I have built the business.
00:00:50I've replaced myself in every aspect.
00:00:52I can work two to three hours a week and it run fine.
00:00:56- Okay.
00:00:57- Fear, I would say the fear of losing family time,
00:01:02the work-life balance and the distractions are my other,
00:01:07I've got another business, drunk removal business.
00:01:10I've got real estate.
00:01:12I've got just all kinds of little.
00:01:15- What do you think you should do that you're not doing
00:01:16that you want me to tell you to do?
00:01:18(audience laughing)
00:01:20- So I know I need to go all in again.
00:01:22- Okay.
00:01:23- And I did that the first five years
00:01:24that I worked out. - And that worked out.
00:01:26- And it worked out great.
00:01:28Went through COVID, I kept the business going really well
00:01:33and I worked myself out of a job, got comfortable.
00:01:36- Okay.
00:01:37- So I don't know what I'm looking for you to tell me to do.
00:01:40- Well, I'll say this differently.
00:01:43I think regrets come when we imagine the upside
00:01:48that we don't have without taking into account
00:01:51the cost that we didn't suffer.
00:01:53And so I think we regret when we imagine the upside
00:01:58that we didn't get without also considering the downside
00:02:03that we didn't suffer to get it.
00:02:05And so I think that's where a lot of regret comes from
00:02:08'cause it's not real.
00:02:09So it's like maybe there's some girl that got away
00:02:11or some business opportunity that got away
00:02:13and we just imagine this amazing thing,
00:02:15but not the trade off that we would have to do
00:02:17in order to get it.
00:02:18We just imagine the upside without downside.
00:02:20And so I would say a couple of things.
00:02:22So one is I think that there are trade-offs
00:02:27that we always have to make
00:02:28and I don't think they're right or wrong.
00:02:30I think they're just their preference.
00:02:31There's no right answer to how much work-life balance
00:02:33you want to have.
00:02:34It's right for you.
00:02:35And so said differently, if I like cookies
00:02:39and I'm good with that and I also want a six pack,
00:02:42I just prefer cookies to a six pack.
00:02:45It's just that's the trade.
00:02:46And I think the dissatisfaction comes from wanting both.
00:02:49- Right. - Right.
00:02:50And so either want less or trade more.
00:02:55And I think that's really what it comes down to
00:02:58in terms of like, is there a path where I can work
00:03:00no more than I currently am to go from six to a hundred?
00:03:04There probably is.
00:03:05It depends on how much you're willing to pay other people.
00:03:07And so you might have to take a short-term hit
00:03:09in terms of profitability to bring in the level of talent
00:03:12that you want to expand the business on your behalf
00:03:14to where you want it to go.
00:03:15And so as long as you were the type of person
00:03:18character-wise that they would want to follow
00:03:20and believe in your vision and you can make your vision
00:03:22big enough that they think that their aspirations
00:03:23can fit within it, you can get that type of person.
00:03:26But like it's a hundred percent,
00:03:28like you're graduating right now into the Who game,
00:03:31but there's levels of Whos.
00:03:32You know, like I remember the first time I hired
00:03:35a $50,000 a year employee and I was like, this is the shit.
00:03:37This is what I'm talking about.
00:03:38You know what I mean?
00:03:39I went from minimum wage labor to 50,000.
00:03:42I was like this, they can read, they can write,
00:03:44like let's go, you know what I mean?
00:03:47And then I hired my first six figure employer
00:03:49and I was like, oh, what was I talking about?
00:03:51Like, this is what's going on.
00:03:53And then I have my first 250, first 500, first million,
00:03:55first multimillion dollar per year employee.
00:03:57It's just levels.
00:03:59And so Sharon, who's our president said this to me years ago,
00:04:02but I always remembered, he said,
00:04:03the best talent's always in the future.
00:04:05So whatever we have today,
00:04:07the best people are always ahead of you, not behind you.
00:04:09And so I think for you,
00:04:13if you really do want to accomplish it
00:04:15without making the trade, you will make a trade.
00:04:17'Cause if you change nothing, nothing will change, right?
00:04:18So we have to change some component of your life.
00:04:22And so the question is, which thing do you value the least?
00:04:25Do you value having more profit
00:04:27or more time with your family in the short-term?
00:04:29In the long-term you can make it up.
00:04:31You won't make up family time in the long-term.
00:04:33You can't make the profit up in the long-term.
00:04:35So if you're willing to give up short-term profit,
00:04:37you can bring in high level talent
00:04:38and then they can lead the growth.
00:04:40In terms of the fear stuff, I mean, I would just say like,
00:04:43just hold the line.
00:04:45If you're like, I'm afraid of losing time with the family,
00:04:46it's like, just don't like I do.
00:04:49And then in terms of the real estate thing,
00:04:51I see real estate 'cause I know about you entrepreneurs.
00:04:53I have a ton of real estate.
00:04:54I don't like, as long as you're not like actively running it,
00:04:58like that's why I'm a fan of like REITs and funds
00:05:03because you have, if you have good partners in that stuff,
00:05:06they can just run it.
00:05:08You can make better than the market.
00:05:09And then, but it's not,
00:05:10it doesn't change anything about what I do.
00:05:12Like me putting in the S&P or me buying another big building
00:05:14changes nothing about my life.
00:05:15And so it's not a distraction unless you're like,
00:05:18you know, if we could add a gazebo
00:05:20and what if we added a different roof?
00:05:23'Cause I'm a roofer.
00:05:23And what if I combined what I'm really like, dude, stop.
00:05:25Just like, let the real estate be the real estate.
00:05:27Let the business be the business and just keep them apart.
00:05:29As long as you're good there.
00:05:30'Cause I think it's a distraction.
00:05:32Actually, let me double check in that real quick,
00:05:35which is when you said you're the distraction thing
00:05:37that you're afraid of, why are you afraid of that?
00:05:40- I'm not afraid of it.
00:05:41- Okay.
00:05:42- I'm just, I've got ADHD and I collect gold.
00:05:45And silver, I buy houses, I buy buildings.
00:05:48I mean, it's just a little bit of the red dress.
00:05:52- Well, as long as it doesn't change anything
00:05:53about what you do, I don't care.
00:05:56But if it's like, now I check this stuff all the time
00:05:58and it like eats up my days,
00:05:59then yeah, I would say that's a problem.
00:06:01And it's only a problem if you decide it's a problem.
00:06:04Like you might just like that stuff.
00:06:05It's just like, I sacrifice my goals
00:06:07'cause I enjoy this ADD.
00:06:08You know what I mean?
00:06:11Like the cost of the big thing is the new stuff
00:06:12that you have to give up to keep it going.
00:06:15- Yeah.
00:06:16- Thank you.
00:06:17I feel like I'm getting some amens.
00:06:17This is really, like a good meal, right?
00:06:20Yeah, I appreciate it.
00:06:22But yeah, that's like the cost of the big thing
00:06:25is all the new stuff you have to give up
00:06:26that you don't get to pursue.
00:06:28All the exciting things that you will no longer participate in
00:06:30because you wanna do one thing big.
00:06:32And I think for me personally, I had this moment,
00:06:36I think a while ago, but like I had this realization
00:06:39of how long it takes to get good at anything.
00:06:41And then I thought about, oh, I only have like 30 or 40
00:06:44more productive years at most.
00:06:47And so I'm like, I've got like four or five
00:06:50big seasons in me left.
00:06:51And so that's it.
00:06:54And so I don't have like unlimited shots on goal.
00:06:58I've got four or five big runs in me.
00:07:00So hopefully that helps.
00:07:02- I appreciate that answer
00:07:03'cause I thought you were gonna say sell everything.
00:07:05- I mean, there are investments.
00:07:07I mean, I'm not gonna tell you to sell your investments.
00:07:09I would say keep passive stuff passive.
00:07:11Don't make it active.
00:07:12That's like incurring cost.
00:07:14'Cause if you're gonna make it active
00:07:15then make active money.
00:07:17If you're like, I wanna take my passive money
00:07:19and then make it cost me more time
00:07:21to get 55% better returns.
00:07:23It's like, you're gonna get way better returns
00:07:24in your active income than your passive.
00:07:26And I would just keep active, active, keep passive, passive.
00:07:30- Thank you.
00:07:31- Appreciate you.
00:07:31- My name is Corey.
00:07:32I'm an electrical contractor.
00:07:33I do 1.6 million a year.
00:07:35Probably keep about 650 of that.
00:07:37I'd like to be about five
00:07:38is kind of what I can see right now.
00:07:40My biggest constraint is myself
00:07:43plus hiring quality candidates.
00:07:46- So you can handle the volume you have right now.
00:07:48So you can't handle the volume you have.
00:07:49You could get more business, but you can't handle it.
00:07:52- I can handle it when the whole crew's here.
00:07:54And then as soon as one guy's gone, I'm back in the van.
00:07:57- Yes, you need more people.
00:07:58- More people.
00:07:59- We have to think about like,
00:08:01so this is probably a multi-step thing just for everybody.
00:08:03Like as we're following through this is like,
00:08:05if we have, if you have enough business
00:08:07which it sounds like you do, that's not the constraint.
00:08:09Then it probably means we need a bump price
00:08:12and we bump price so that we can have the cashflow
00:08:14so that we can hire the extra person
00:08:16so that you have redundancy in the team, right?
00:08:18Like if Alex had to hop in, if Tim's sick,
00:08:22that's not gonna work, right?
00:08:23We have to have two or three backups
00:08:24for any person who's here
00:08:25so that I can keep doing my job, right?
00:08:28And so, but I can only do that
00:08:30if I have the cashflow to sustain multiple Tims, right?
00:08:33And so this is where sometimes
00:08:35it's like a multi-step solution.
00:08:37So it's like, we have to fix the pricing component
00:08:40and it's like, okay, well, I feel weird charging more
00:08:43because other people in my market
00:08:44charge even less than I do
00:08:45and I'm a little bit above the market, right?
00:08:47So then we have to think about the offer.
00:08:48It's like, okay, so the offer might be the issue,
00:08:50which is like, okay, can we make our thing faster?
00:08:53Can we make it more reliable or we can make it easier, right?
00:08:56And can we guarantee around that?
00:08:57And if the answer is yes, and it's like, great,
00:08:59well then that's what we're gonna charge our premium
00:09:00and bump prices by 20 to 40%, which sounds like a lot, I know.
00:09:04But we say, hey, if we don't meet any of these qualifications
00:09:07I'll give you all my profit back,
00:09:09which means that you raise the price.
00:09:10And if for some reason you don't meet it,
00:09:11you go back to the exact same price you're charging now,
00:09:13but everyone that you do meet everything on,
00:09:15you get all the juice.
00:09:16And if no one else does those kinds of guarantees,
00:09:19which basically no one does, then you can basically say,
00:09:22well, the reason that they're not doing that
00:09:24is because they're not confident
00:09:25they're gonna be on time and on budget, right?
00:09:27And I am.
00:09:28And so it's very easy for somebody else to say,
00:09:31hey, I'll do this job for you
00:09:32and maybe I'll be on time and maybe I'll be on budget.
00:09:35But if I have no teeth in that agreement,
00:09:37I promise that it'll be free and I'll be done tomorrow.
00:09:40But if I don't have to be right about it, who cares?
00:09:42Sure, I'll be done tomorrow.
00:09:43And they'll be like, oh, I guess I get your point.
00:09:45Like, right, I'll be done by this time
00:09:46and it'll be done satisfactory at this price, period.
00:09:49And you know that when you sign this, you get that.
00:09:51That's it.
00:09:52And if for some reason something happens,
00:09:53we'll come back and fix it, right?
00:09:55And so by doing that, you'll be able to increase
00:09:58the cashflow, which will then allow you
00:09:59to go recruit the extra tech that you need
00:10:01so you can stay above the business.
00:10:02And then ultimately, honestly, just keep advertising it
00:10:04so that you can keep hiring and backfilling.
00:10:07- Okay, I can see that totally for my service calls
00:10:10and stuff like that.
00:10:11Kind of my bread and butter is I chase six
00:10:14or seven different heating and cooling companies around
00:10:16and do all their electrical work.
00:10:17So they take the lead.
00:10:19I have a flat rate sheet for that.
00:10:21But the biggest thing they always complain about is price.
00:10:23And we're super efficient to get in, get out,
00:10:26but they're always complaining about the cost
00:10:29that we came in at.
00:10:30- Do they still buy from you?
00:10:32- Have for six years.
00:10:34- Yeah.
00:10:35I mean, I care more about what people do than what they say.
00:10:39- Okay.
00:10:40- Everyone would like it cheaper.
00:10:41- Right.
00:10:42- I would like it cheaper.
00:10:43I would like all of you guys to get paid less.
00:10:45(laughing)
00:10:48But it's, yeah, I just, I pay very little attention to that.
00:10:53- Okay.
00:10:53- Like customers will always want it cheaper.
00:10:55They will always want it faster.
00:10:56They always want a guarantee.
00:10:57Like these are all things, like that will not change.
00:10:59- So when I'm moving my prices, don't even.
00:11:01- Yeah, I'd be like, this is what it is.
00:11:03- Okay.
00:11:04- Yeah.
00:11:04Now to make yourself sleep better,
00:11:06you have six or seven guys.
00:11:07It's like, wouldn't it be cool if you had like 60, right?
00:11:11So then we go back to the top here,
00:11:13which is you have your way of getting customers,
00:11:15which is mostly chasing these six or seven heating
00:11:17and cooling companies around.
00:11:18And so it's like, what do you get?
00:11:19What do you do to get the heating and cooling companies?
00:11:21- Basically I've worked for one for 15 years
00:11:23and it's just constant.
00:11:24- Yeah.
00:11:25- And then the other ones,
00:11:26since I opened my business shortly after,
00:11:28they've been with me.
00:11:29And so really I have no-
00:11:31- You have no marketing function.
00:11:32- Yeah.
00:11:33- So you should start doing,
00:11:34this is what I would do if I were you.
00:11:36I'd start doing outreach to other heating and cooling
00:11:38companies that, hey, let me quote some of these jobs for you.
00:11:40Like a lot of people are just stuck with the person
00:11:42they're with.
00:11:43They're not happy.
00:11:43They're not unhappy.
00:11:44They're just whatever.
00:11:45Like, let me at least get some,
00:11:46it'll just keep them honest at least, right?
00:11:49And so then you can just start bringing business for yourself
00:11:51and that'll just give you more leverage
00:11:52with all of the other kind of negotiations that you have
00:11:56with the existing companies.
00:11:57- Okay.
00:11:58- 'Cause right now you're just dependent on them.
00:11:59So they have all the leverage.
00:12:00- Well, yeah.
00:12:01And then as soon as they,
00:12:02like I'm missing out on work.
00:12:04- Yeah.
00:12:05- Because as soon as they say, hey, we have a job tomorrow.
00:12:07- Yeah.
00:12:08- I'm going, 'cause they're my, they're my whales.
00:12:10- Right.
00:12:10- So it's-
00:12:11- So you see more whales.
00:12:12- Okay.
00:12:13- So we need more whales, but to get more whales,
00:12:14we have to tweak price to get,
00:12:15so that we can hire the manpower.
00:12:17Like it's usually multi-step solutions.
00:12:19'Cause like for most businesses, it's,
00:12:21if it were one thing you probably would have already seen it.
00:12:23So it's usually second order or third order
00:12:25that has to change so we can reverse engineer back
00:12:27to fixing the core problem.
00:12:29- Gotcha.
00:12:30Thank you.
00:12:31- That feel good though?
00:12:32- Yeah.
00:12:33- Okay, cool.
00:12:34- I appreciate that.
00:12:34- Real quick, I'm going to show you the exact 10 stage roadmap
00:12:36from zero to a hundred million plus
00:12:38that less than 1% of companies finish.
00:12:40I've now done multiple times.
00:12:41And so I can say with a lot of confidence
00:12:43that these are the stages as headcount increases
00:12:46that you need to get through.
00:12:47And I broke each of these down
00:12:49by eight different functions of the business.
00:12:50What the constraint feels like,
00:12:52like what are the symptoms of it
00:12:53when you're going through it?
00:12:54And then what steps we actually took to graduate.
00:12:56We've done this across software, physical products,
00:12:59service businesses, brick and mortar, all of this.
00:13:02And it works.
00:13:03And it's my gift to you.
00:13:04It's absolutely free.
00:13:05And so the link's in the description,
00:13:06but you just go acquisition.com/roadmap.
00:13:09Just enter your info and it'll spit it right back to you.
00:13:10All free.
00:13:11- My name is Tanner Jarrett.
00:13:12We're at 1.5 mil the date, 700 net.
00:13:15My big concern is how do I make the dream team
00:13:20like you have here?
00:13:21How do I get technicians on board, sales guys,
00:13:25make it work?
00:13:26- So, okay.
00:13:28What breaks when we do more?
00:13:30- What breaks?
00:13:31- Like what stops you from doing this?
00:13:33We're gonna figure out which one, like order of ops.
00:13:35What breaks when you do that?
00:13:37- Biggest issue is technicians.
00:13:39- Okay, so techs is the issue.
00:13:41Okay, so what do you make on a tech?
00:13:45- Anywhere from 180, 200, 300,000 a year.
00:13:50- Per?
00:13:50- Yeah.
00:13:51- After cost?
00:13:53- Uh-huh.
00:13:53- Damn.
00:13:54- This year, yeah.
00:13:55- Your dentist.
00:13:56He's giving you a run for your money there.
00:13:58I'm just saying, man.
00:13:59All right.
00:14:00All right, so we've got 300K for the techs.
00:14:02Got it.
00:14:04All right, and you need them local in Bozeman?
00:14:06- Yes.
00:14:07- Okay.
00:14:08And what are you doing right now to recruit techs?
00:14:10- Honestly, kind of just gave up lately.
00:14:13- Yeah.
00:14:14- Yeah.
00:14:15- I would imagine that would make it difficult
00:14:16to recruit more techs.
00:14:17(all laughing)
00:14:20So then let me ask the next question,
00:14:22which is like, what stops you from recruiting more techs?
00:14:25Not the decision.
00:14:26There's like, some of you guys have probably seen
00:14:28that management diamond that I have,
00:14:29which is like, people don't know that you need to do it.
00:14:31They don't know how to do it.
00:14:33They don't know when to do it by,
00:14:34if something blocking them or there's a motivation issue.
00:14:36I'm assuming you're motivated.
00:14:37I'm assuming you already know that you need to do it
00:14:39and how to do it.
00:14:40- 100%.
00:14:41- So, and you need to know the when is now.
00:14:42So I'm guessing there's something blocking you.
00:14:45- My thing that's blocking me is I have to be involved,
00:14:49I believe, in every single.
00:14:50- Strong words.
00:14:51- Yeah, every single aspect of the company.
00:14:55- Have to or choose to?
00:14:56- Choose to.
00:14:57- Okay. - Choose to, 100%.
00:14:58- Just a word.
00:14:58- Yeah, yeah, yeah.
00:14:59- You know, thinking from the same book.
00:15:00- Choose to. - Okay.
00:15:01- And so I can't, I can't let it go.
00:15:02- Okay, so can't or won't?
00:15:04- We have some, okay.
00:15:06We have some very high end clients.
00:15:07- Okay.
00:15:08- So we work at the Yellowstone Club.
00:15:10- Okay.
00:15:11- In Montana, Spanish Peaks.
00:15:13I know Matt Damon, Jennifer Garner, Mark Zuckerberg.
00:15:16- I mean, you don't need a name drop.
00:15:17- Yeah, sorry.
00:15:18(all laughing)
00:15:19- You're a big deal.
00:15:20- I'm not a big deal.
00:15:21(all laughing)
00:15:22- It's tiny.
00:15:23Ed told me to say it.
00:15:24(all laughing)
00:15:26Anyhow, and so it's hard to let that go.
00:15:30You know, that, that ego.
00:15:33- So fundamentally, this is, I guess this is,
00:15:37I mean, Keyman is the number one risk of every business
00:15:40for two reasons.
00:15:41One, no one wants to buy it,
00:15:42but second, you want to kill it yourself at some point
00:15:43'cause you're like, I don't want to do it.
00:15:44You said you burned yourself in the ground, right?
00:15:46So what we have to do is if we look at all of the things,
00:15:50like look at your behaviors,
00:15:51not your feelings around them and say, okay,
00:15:53these are all the things that I do on a daily basis.
00:15:56Some of those things, someone else can do.
00:15:58Now there's for sure things
00:15:59that are higher leverage, higher value.
00:16:00It might be that for you doing the design for stuff
00:16:04is the highest leverage thing.
00:16:05I don't know, it might be.
00:16:07It might, it's definitely not using your hands.
00:16:09I can promise you that.
00:16:10It might be getting the relationship
00:16:12and managing the relationship.
00:16:12That might be the most valuable thing.
00:16:14So if we just did it, if we, if we did a rank order,
00:16:16this is what you'd have to do.
00:16:18It's like we do a time study, which is step one.
00:16:20So take an Excel sheet.
00:16:22You can open up on your phone.
00:16:23Every 15 minutes you have an alarm.
00:16:24It'll annoy everyone.
00:16:26Don't worry about it.
00:16:27And every time it goes off,
00:16:28you just write what you did in the last 15 minutes.
00:16:30And at the end of the week,
00:16:31you can look at all those activities
00:16:33and rank them in terms of revenue.
00:16:35Like which of these is the most valuable and most unique?
00:16:37And then when you look at the bottom half of that list,
00:16:40does it neatly fit into some person
00:16:43that either exists currently that has bandwidth
00:16:45or somebody that we can hire?
00:16:47And part of the good news that you have
00:16:50is that when you serve premium customers, which you do,
00:16:53you can charge a premium, which you do,
00:16:55which means that you should have excess margin
00:16:56so you can get premium people.
00:16:58And so right now what will probably be required
00:17:02is that you have to lower your tolerance
00:17:04for mediocrity on your team.
00:17:06And so it might cost,
00:17:09so if you're gonna make $300,000 per year for a tech,
00:17:13it's like, would you be willing to spend $50,000
00:17:15to go get another tech who's good?
00:17:17- 100%.
00:17:17- Right, and so that's a combination of like,
00:17:20you could try the recruiting firm thing, which is a thing.
00:17:22One that you probably haven't thought of
00:17:24that I would strongly recommend,
00:17:25this will probably be the unlock for you,
00:17:27is run national ads
00:17:29and then offer a really generous relocation package.
00:17:32So make the 50 basically a signing bonus.
00:17:35You get 25 now and 25 a month six.
00:17:37- What do you think about instead of having W2 employees
00:17:41and how much they cost running 1099 service techs?
00:17:45- You're a business.
00:17:47Do they have to show up at certain times
00:17:48and do work specific the way you want them to do?
00:17:50- Yes.
00:17:51- They're employees.
00:17:52- They're employees.
00:17:53- Yeah, unless they're like, they're not vendors.
00:17:55They work for you.
00:17:56If you have meetings and they have to show up,
00:17:57they're employees.
00:17:58So no, you like--
00:18:00- Keep it W2.
00:18:01- Yeah, you wanna go more legit, not less legit.
00:18:04- Okay.
00:18:05- Yeah.
00:18:06But fundamentally, like if you were to spend this $50,000
00:18:09to go get another tech,
00:18:11we just have to like, getting the tech,
00:18:12I don't think it's gonna be that hard, honestly.
00:18:14If you're just willing to spend money for it,
00:18:15which you have the money to do it.
00:18:17And then the other piece is,
00:18:19okay, now that this person comes on,
00:18:20I have this big stack of stuff.
00:18:21How can I give them a third of it or half of it?
00:18:23And then all of a sudden you get those time back.
00:18:25And so let me ask you a different question.
00:18:28If you got half your time back,
00:18:30could you double the business?
00:18:32- 100%.
00:18:33- Right.
00:18:34And so that's the game.
00:18:35- Yeah.
00:18:36Beautiful.
00:18:37Thank you, Alex.
00:18:38- My name's Trenton.
00:18:39We sell roofing.
00:18:40We're gonna do about 3 million this year.
00:18:42We'd like to be at 10 million.
00:18:44My biggest constraint on what's stopping me
00:18:46is that for the last eight years,
00:18:49all of our lead gen has been from--
00:18:51- Weather.
00:18:52- From doors.
00:18:53- Okay.
00:18:54- So it's been 100% door-to-door lead gen.
00:18:56And now when we're trying to knock for retail,
00:19:00it seems to be like heavier of a weight on the team.
00:19:04- When you say retail, what do you mean?
00:19:06- So like just people in market that need a roof.
00:19:09- So like residential?
00:19:10- Residential.
00:19:10- Okay, got it.
00:19:11And when you were doing door knocking
00:19:12before you were knocking on?
00:19:14- Residential doors.
00:19:15- Okay, so it was the weather--
00:19:15- But we were getting funding from the insurance company.
00:19:17- Got it.
00:19:18Word, okay.
00:19:19Yeah.
00:19:20Okay, so keep going.
00:19:20- So now with me being a door-to-door guy,
00:19:25like purchasing leads and all that was like sacrilegious to me
00:19:28so there's some limiting beliefs there
00:19:31that I started to explore last October.
00:19:35We bought leads--
00:19:36- I just want you to be lead curious.
00:19:37That's all I'm asking for.
00:19:38- Yeah, I'm very lead curious now.
00:19:40(laughing)
00:19:42But I basically got slaughtered learning this--
00:19:45- Yeah, this will be acquisitionary binary.
00:19:47You know what I mean?
00:19:48Like be non-binary with your leads.
00:19:49Like as many as you want.
00:19:50- Yes, yes.
00:19:51No, that's what I'm trying to do here.
00:19:52And when we did purchase leads--
00:19:54- You get the unedited version, by the way.
00:19:57Yeah, go ahead.
00:19:58- And when we started to, you know,
00:20:00stack the guys' calendars, there was a big culture shift
00:20:03where we actually saw like more buy-in from the guys,
00:20:06but then like the door knocking just went way down.
00:20:09- Yeah, 'cause it was easier.
00:20:09- It was way easier.
00:20:11But like our CAC and all of that was absolutely horrid, right?
00:20:16So I'll spend like $7,500 just to acquire one customer
00:20:20over the summer and it wasn't sustainable.
00:20:22So I saw--
00:20:23- What did you make from a customer?
00:20:25- On average $6,500.
00:20:27- So that does not work?
00:20:28- No, it doesn't work.
00:20:29And it was just like a lot of the marketing agencies
00:20:32that we worked with were like younger people.
00:20:34They were like using AI tools, go high level.
00:20:37So we decided that we were gonna build it in-house.
00:20:40So with that being said, now it comes into, you know,
00:20:44a leadership issue because I need somebody
00:20:47that like knows how to, you know, market better than I do
00:20:51so that I can focus on training and--
00:20:54- Can I pause you real quick?
00:20:55- Yes, please.
00:20:55- Okay, cool.
00:20:56So you're at three, you wanna get to 10.
00:20:58You rebuilt it from storm chasing
00:21:00to just straight up door knocking whenever, fine.
00:21:03I think it was a good idea.
00:21:05You had a door knocking team.
00:21:06You took the same sales guys,
00:21:08brought them on leads that you got them.
00:21:10They got lazy, fat, and don't wanna do door knocking anymore.
00:21:13So great rule number one,
00:21:14outbound and inbound are separate teams.
00:21:16- Yes.
00:21:17- Inbound is what you graduate to.
00:21:20And so if you're an absolute savage,
00:21:24like you just take children's souls
00:21:26and just rip them out every day
00:21:27'cause you're a terrible person.
00:21:30But you're just unbelievable at sales.
00:21:32Then and only then do you get the opportunity
00:21:34for me to feed you leads.
00:21:36Because these are the most expensive leads
00:21:38that we have to work very, very hard for to make sure,
00:21:41and like we cannot waste them
00:21:42on anybody who cannot close everything.
00:21:44And so thank you.
00:21:45I hope that was an amen.
00:21:46And so first off is the team should be separate,
00:21:51but you're in this mix now.
00:21:52You're in a little bit of a mess.
00:21:53And so my two cents would be like,
00:21:56'cause I'm sure their commissions have gone down
00:21:58since they now are selling nothing basically.
00:22:00- Yes.
00:22:01- Yeah, so I would say, guys, my fuck up.
00:22:02I went to this thing.
00:22:03He told me I did this big boo-boo,
00:22:05which is inbound and outbound, we're together,
00:22:06which is not how it should be.
00:22:08Everybody get back on the streets, you guys do that.
00:22:10And then for the absolute savages of you,
00:22:12because you can usually have far fewer people on inbound,
00:22:15that becomes the Christmas tree of the career path.
00:22:17Because on inbound, I can feed you
00:22:21and you can do like five sales a day.
00:22:22You can't do that door knocking, right?
00:22:25But you can do it if I'm feeding you leads
00:22:27that are already qualified, already set,
00:22:29already gone through a VSL, whatever, in the sales motion.
00:22:32And then those guys can absolutely clean up,
00:22:34but you earn the opportunity
00:22:36to get that level of commissions.
00:22:38Now the commission's structure
00:22:39should also be different on inbound
00:22:40because you have to pay for those leads.
00:22:42So it's a different role.
00:22:44They graduate to it.
00:22:44It's more volume, lower per, but it's more reliable,
00:22:47which guys with families, things like that.
00:22:49If you have a bad day, you close two
00:22:51and a good day, you close seven.
00:22:52It's different than you have a bad day,
00:22:54you can close zero, zero, zero, right?
00:22:56It's much more, it's much more stressful.
00:22:58And so guys will be happy to even give up,
00:23:00they'll even make the same money,
00:23:02but you have to be more reliable.
00:23:03They'll be, and you don't have to be in the sun, so.
00:23:06- So then we should hire for inbound sales.
00:23:09- Yeah, or take one of the guys you have
00:23:10who's really good at it and put everybody else
00:23:13back on the street so that you just funnel everything
00:23:15to that guy who, 'cause then you can iterate faster
00:23:17'cause you're new on this.
00:23:18And so you never wanna have too many news
00:23:21'cause kinda like the brick analogy I gave at the beginning,
00:23:23the more news there are,
00:23:24the more likely something's gonna fuck up, right?
00:23:26And so it's like, I know this is
00:23:28an absolute savage salesperson.
00:23:29If they're closeable, he'll close 'em or she'll close 'em.
00:23:32And so then the only variable we have is just
00:23:34what offer slash lead source am I getting?
00:23:37And like what process are going from lead to talking to them?
00:23:40Those are the only variables you have to play with
00:23:41and she can control.
00:23:42It's much easier to iterate on that
00:23:43and then get it to go faster.
00:23:45- Okay.
00:23:47Okay.
00:23:48And then, okay.
00:23:49So then I wanna hire a marketing director or leader
00:23:54to manage that.
00:23:56- Outbound team goes out, inbound team becomes the one guy.
00:23:59You need to hire a marketer person
00:24:00who actually knows what they're doing.
00:24:01Probably pay more than you expect,
00:24:03but then that person will be worth it.
00:24:04Your entire business is sales and marketing,
00:24:05so you should have the core elements
00:24:07of the business in-house.
00:24:09- Okay.
00:24:10- Great. - Excellent.
00:24:10- If you need help with the sales process, we can help.
00:24:12- Excellent.
00:24:12Thank you.
00:24:13- My name's Art.
00:24:14We sell junk removal and demolition
00:24:15to commercial property managers.
00:24:17Currently do one million a year.
00:24:19Would love to be at 10 million a year.
00:24:21What's currently stopping us is knowing
00:24:23which sales channel to focus on.
00:24:25I know it's important that we pick one, capitalize on it,
00:24:28and I'm wondering how much time, energy or volume
00:24:31do I spend on one while I determine
00:24:33if that's gonna be our channel or not,
00:24:35and know whether to leave that one or focus on that one.
00:24:38- Yeah, so I'll give you two answers to that question.
00:24:41So before I answer it, I'm gonna do the first thing though.
00:24:44Really the second thing first.
00:24:45So what do you do currently right now to get customers?
00:24:49- Right now it's been mostly referrals.
00:24:53- Okay, so you can't do more referrals
00:24:55because there's nothing for you to do besides do a good job.
00:24:57Okay, that's fine.
00:24:58If referrals is the way you're getting business,
00:25:01what ways have you begun
00:25:02or you haven't started doing sales channels yet?
00:25:04- So we've started to lay the framework
00:25:07for doing email, cold outreach as well,
00:25:11simultaneously with LinkedIn outreach,
00:25:13and then also converting some of our social media efforts
00:25:16into a bit of outreach as well with people who are engaging.
00:25:19So those are some of the things that we're--
00:25:21- Like mini chat and then DM and all that.
00:25:22- Yeah, yeah, more manual for now
00:25:24while we get the flow going,
00:25:26and then also I'm in a networking BNI, so that's--
00:25:29- Yeah, I would prefer you stick with one of them
00:25:32and just do more in that thing.
00:25:35And so if the question is, how do I,
00:25:36so the original question was,
00:25:38how do I know which one to pick
00:25:39and how long to stick with it?
00:25:41So I think I will reject the premise,
00:25:44which is that one of them is going to work.
00:25:47Like you will make one of them work.
00:25:49And so you could make any of them work.
00:25:51And so I would take the hypothetical extreme of,
00:25:54is there a business that acquires other businesses customers
00:25:59in each of those different channels in your market?
00:26:02- I'm not sure.
00:26:05- I'll bet there is.
00:26:07There probably are some junk removal people
00:26:08who do it via social media and they take it that way.
00:26:11Some people probably do it via LinkedIn.
00:26:12Some people do cold outreach.
00:26:14All three of those are super repeatable channels
00:26:17that anyone could run.
00:26:18So all of them can work.
00:26:21My recommendation to you would be the one
00:26:23that you have the highest overlap
00:26:24with existing skillset between you and team.
00:26:28So if you and or your team have more knowledge
00:26:31around social media stuff,
00:26:32they'd be like, just double down on social media.
00:26:34If it's, I have,
00:26:36we're better at kind of the outbound motion.
00:26:38Then I would say, go do the outbound motion via email.
00:26:41And if it's like, well, we want to boost these things.
00:26:43It's like, well, why don't we just send more emails?
00:26:46You know what I mean?
00:26:47Does that help?
00:26:48- Yeah, it does.
00:26:49- Okay, good.
00:26:50That was super.
00:26:51I was like, you sure?
00:26:52Everything else?
00:26:52That was, that was an easy one.
00:26:54That was like a warmup.
00:26:55- Well, for, I guess, follow up,
00:26:58since you're taking more questions,
00:27:02I guess if you had to just say one,
00:27:05like let's irrelevant to what the team has.
00:27:07- Which one do you have the best skillset?
00:27:10- To be honest, I just don't have the skillset.
00:27:11And I guess networking is number one.
00:27:13Like when I'm in person with people, I'm doing the best.
00:27:16- Okay.
00:27:17So hear me out then.
00:27:20Wild idea.
00:27:21So you do networking stuff.
00:27:23And so if I said, I want you to spend four hours a day
00:27:25to find every local community-based related event
00:27:29with 20 people or less or 50 people or less in it
00:27:32that have people who are similar to your avatar,
00:27:34would you be able to do that?
00:27:35- Yes.
00:27:36- Okay.
00:27:37So why can't we do more of that?
00:27:39- We can do more of that.
00:27:40- Okay.
00:27:41So how many of those events do you currently go to?
00:27:42And I'm guessing you get customers
00:27:44from when you go there, right?
00:27:45- Yeah, they compound over time.
00:27:47We go to currently a few a week
00:27:49and then we're meeting one-on-one
00:27:50with a lot of people we meet. - Afterwards.
00:27:51Right.
00:27:52So I would say, all right, well then what would it take
00:27:55for us to go to like several a day?
00:27:57That would be my first kind of like risk adjusted move
00:28:01because the other things you haven't done yet at all.
00:28:03So it was like, how do we go from one to three?
00:28:06Just like this year, I would do that.
00:28:08'Cause then it'll free up more cashflow.
00:28:11Because the issue that you have right now,
00:28:12especially like in the swamp that you're in right now,
00:28:15I would just do way more of the thing you're currently doing
00:28:18as my path of at least getting to one to three.
00:28:20It's probably super profitable for you as well.
00:28:22And then I would invest more of those resources
00:28:25into learning one of the other channels.
00:28:29- Got it.
00:28:30All right, thank you. - Cool, you bet.
00:28:31- My name's Adrian.
00:28:32I own a commercial construction company.
00:28:34Did 11 million this year, 10 last year.
00:28:38Read the book, Built to Sell.
00:28:40So I started analyzing my company and I said,
00:28:43or I figured out that construction companies
00:28:45are not an easy asset to sell.
00:28:48That they're enterprise values based off of assets
00:28:51or backlog of work.
00:28:52As a commercial contractor, I thought to myself,
00:28:55okay, well, how am I gonna do that?
00:28:57So we started doing public works projects,
00:28:59bought some heavy equipment.
00:29:00Now we have contracts that are for several years.
00:29:03At the same time with the clientele base that I had
00:29:06in the multifamily space, I started thinking about,
00:29:08okay, well, if I don't wanna sell this company,
00:29:11if it's gonna be that difficult,
00:29:12how do I get recurring revenue?
00:29:14So I started an elevator company.
00:29:16And over the last 12 months, we did 3 million to start.
00:29:20- It's a racket, congrats.
00:29:21I have elevators, it's ridiculous.
00:29:25- We can help you.
00:29:26So if you were me, with the two companies
00:29:31and the combined revenue, what would you do next
00:29:34in order to go from 10 to 100?
00:29:36- What's profit on three versus 11?
00:29:38- 30% on the three, 18% on the 11.
00:29:42- Okay, so you're making roughly double
00:29:44on the construction side, but cashflow sucks
00:29:46and it's a pain and you never take the money
00:29:47out of the business probably, I'm guessing.
00:29:49Okay, so it's a tough call 'cause you already did it, right?
00:29:53You can't like not have the kid.
00:29:55It's already out there running around.
00:29:57- That's what I had said.
00:29:58- Can't insert, it doesn't go back up, right?
00:30:01Okay, so I think, again, it depends on what you wanna do.
00:30:07So I think the elevator company totally could sell
00:30:10if you wanted to sell that business.
00:30:13- They do.
00:30:13- Are you splitting your time right now?
00:30:15- Yes.
00:30:16- Yeah, so it might take $800,000 in profit
00:30:21on the construction side to get the two or three liters
00:30:25that you need to do it without you
00:30:27and then it would continue to exist.
00:30:29I do think the elevator is the better opportunity
00:30:32for the reasons that you're already aware of
00:30:34and it probably grew significantly faster
00:30:35than the other one did.
00:30:36- Oh yeah. - Yeah.
00:30:37This isn't normally what I would say
00:30:39in this type of situation, but I'm just familiar with it.
00:30:42- What timeline do you have?
00:30:44Like selling five, selling 10.
00:30:46- Definitely 10, if I could do it in five.
00:30:49- Okay, you could sell in five.
00:30:50I mean, what's the growth rate on the elevator?
00:30:53- Well, I mean, year one, 3 million.
00:30:54- Oh, year one, right, right.
00:30:55So it's a straight up elevator.
00:30:57Okay, sorry.
00:30:58(all laughing)
00:30:58- Exactly. - Straight to the penthouse.
00:31:01Okay, so there's the reasonable advice,
00:31:06which is, hey, hire the people
00:31:08and then let them continue to run the thing.
00:31:10And then I would say like what the quote Alex advice would be
00:31:13which is super unreasonable.
00:31:15That's and I only give it because this is what I did.
00:31:19I burned things down.
00:31:21And so if I can't exit it, so like you could exit the 11 now
00:31:24for way less than you think it's worth, right?
00:31:27I would just be willing to exit it.
00:31:29I had six gyms and I fire sold them in 90 days.
00:31:32I made in total on six what I should have made on one.
00:31:36And then within six months I was doing a million a month
00:31:39on the next thing.
00:31:40And so once it was like clear
00:31:43that this was a way better opportunity,
00:31:44like the orders of magnitude better,
00:31:46which I think you were in that situation right now,
00:31:48it's super niched.
00:31:49It's you've obviously got ends
00:31:51in terms of understanding how to work.
00:31:52It's already recurring.
00:31:53It is a racket, a legal racket, but it is, oh, it is.
00:31:58If you're willing to take a step back, like you will,
00:32:03if you had, if you're like, I want to do this in two years,
00:32:06you'll like the break even point on this is two years,
00:32:08which is like if you got rid of the construction firm
00:32:11in the next 90 days and you said,
00:32:14I don't care what the price is.
00:32:15I just want all the headache back.
00:32:17You will grow so much faster on the elevator side.
00:32:19Like it'll be like you did three
00:32:21while splitting your attention.
00:32:22If you had had full attention, you might be at eight.
00:32:25And so I tend to think only exclusively on opportunity cost.
00:32:30I don't normally give that advice
00:32:31'cause it's like, it's just so hard for people to do,
00:32:34but I burn things down when I like am very clear
00:32:36that this is the next thing I'm gonna do
00:32:38just 'cause I know that my,
00:32:40the opportunity cost of the time of just continuing
00:32:42to wind this down or get it ready for sale,
00:32:45I could make more than I'm going to make on that sale
00:32:48in this opportunity.
00:32:49So like, let's say that a perfect exit for that business
00:32:55would be like $5 million or something, right?
00:32:58Based on the assets and the AR that you have coming.
00:33:00It's like for me to build another million dollars
00:33:05in recurring revenue in the elevator business,
00:33:08I can do that in a quarter,
00:33:10which equals the enterprise value of the other thing.
00:33:13And so as long as you can get out of your head around like,
00:33:16'cause everyone, if you do this,
00:33:18everyone will tell you that you're crazy.
00:33:21Everyone has told me that I was crazy
00:33:22every time I've done this.
00:33:24And that's why also none of them are wealthier than I am.
00:33:28They're just like, no one who is wealthier
00:33:30than me told me that.
00:33:31So as long as you're good with it
00:33:34and you can just stomach the fact that your wife's like,
00:33:36you worked so hard on this and your dad's like,
00:33:38this is ridiculous, all the blood, sweat and tears
00:33:40and all this stuff and you're like,
00:33:42I did this so I could learn all these skills
00:33:44and apply it here.
00:33:46It was not a waste 'cause I was the asset.
00:33:48- Thank you.