Jocko Podcast - 328: You Get The Life You Give Yourself. With CEO, Matt Malone

Episode Date: April 6, 2022

0:00:00 - Opening0:02:22 - Matt Malone, CEO.2:24:11 - Final thoughts / How to stay on THE PATH.2:42:15 - Closing Gratitude.Support this podcast at — https://redcircle.com/jocko-podcast/exclusive-content

This is Jocko podcast number 328 with Echo Charles and me Jocko Willink. Good evening, Echo. Good evening. Leadership is the most important thing on the battlefield. It's the most important thing in business and it is the most important thing in life. And on this podcast, we consistently and regularly go through examples of that from military history and about. how the principles of extreme ownership apply to combat situations. And I've had many combat leaders on this podcast from every level, from corporals and sergeants

to gunnery sergeants and master chiefs to generals and admirals talking about these principles of leadership and how they apply on the battlefield. And sometimes they talk about how these principles positively impact their lives. of well as well so we've covered the battlefield we've covered life tonight we're going to get a perspective from the business side from an individual that has taken the principles of extreme ownership the laws of combat the leadership strategy and tactics that we learned in combat and has applied them directly to his business resulting in some incredible success our guest tonight is Matt Malone.

He's the CEO and owner of Groundworks, which is a nationwide construction company that provides foundation repair, basement waterproofing, crawl space encapsulation and concrete lifting, and a host of other services that helps keep Americans' foundations dry and safe and serviceable. It's a company that's ranked,

number 1,047 on the Inc. 5,000 in 2021. Grew by 461% in three years. Has over 20 brands under its umbrella still growing. And that growth is based on leadership. And that leadership starts with the CEO, Matt. Matt, thanks for coming on. Thank you, Jocko. It's an honor to be here.

Let's start at the beginning. Let's start at where you started. Yes, sir. Tell us about growing up. Well, I grew up in a town not too dissimilar to this one, not as pretty. Norfolk, Virginia. Come on, man. Come on, man.

Norfolk's pretty, pretty place. I looked out the window at last night or this morning, overlooking the little harbor there. It's like, man, I see the big Navy vessels, but doesn't quite look the same as my hometown. But a lot of similarities, a lot of similarities. But it's a lot of differences. So I grew up in Norfolk, Norfolk, Virginia. For those that don't know, it's probably East Coast Command for the Seals. It's the world's largest Navy base, I think.

A lot of shipbuilding there as well. I'm a Navy brat, so my dad was enlisted in the Navy's. He made his way there from Texas. So he was born in Denison, Texas. It's a classic story that you probably see a lot. tough childhood he said I'm going to go join the Navy and see the world and he did he did

he was enlisted E5 but he spent four years in the Navy two years in the Guard but it brought him to Norfolk as you can imagine there he met my mom and she too is a Navy brat so my grandfather

he was Chief Warren officer so he's 20 years plus so he he served he was actually in the Pacific theater for the most of his career yeah he was injured and kamikaze attack and you know he's got some great stories now he's no longer with he was on well i only know in in the atlantic he was on his first ship was the brooklyn the u s brooklyn um he's no longer with us so in fact i i was trying to find some things before i came to see you to see if I could get some more data. But he lived and kind of raised for many years my mom in Guam.

So, you know, he was Pacific Theater and, you know, finally moved back to retire in Norfolk. And that's how, you know, my parents met. So, you know, Navy towns are a lot of examples like that. Yeah. So what'd your dad do while you're growing up? You know, it's funny in the Navy. So he's a Texas guy, tough life, ran away, frankly, to get some freedom.

In the Navy, he was involved with computers of all things, which back in the day, that was, what was that like a calculator? It was like he would have these big tape type things that he would chug around. And that was the skill that he learned in the Navy. And then he went to work for, as this kind of new technology rolled out in the banking world, so he would oversee the computers at a couple local regional banks. Now when I was a kid I went on a field trip so this is we're talking this might be 1977 or something like that I was young and I remember we went to a bank on a field trip

and first of all I was just thinking this is the most boring thing I've ever seen in my life I don't want to do I'm never going in a bank and but they had this thing that they were calling a computer and they had the little these little punch cards and I think it was some kind of an IBM computer system that kept track of something and I remember thinking well not going into banking over here. I'm sure there's some kids that were thinking, wow, look at that guy with a briefcase. Remember, did you think a briefcase was ever cool, Echo, Charles?

No, not that I can remember. I remember some kids thought a briefcase was cool. I wasn't one of those kids. So going into a big room now with stacks and stacks of machinery, and they had to take these tapes down every night and move them for security to a different location. It wasn't like you talk computers today. and all these kind of glamorous things.

It was the opposite of that. So he would manage a store as the tapes would store the data from the transaction, I guess, from the customers during the day and make sure they're protected. Really didn't know what he did. But I too knew that I never wanted to do that. But, you know, as a kid, you just, it's, I would just say that my parents, just great people. We grew up, as you can imagine, fairly poor. So we lived in a 1,200 square foot house with one bathroom.

I have a brother, but never knew it, frankly, never knew what wealth really was. I just knew that my parents loved me and just got after. My mom was a telephone operator. When Eckerd didn't even know what that is, but they don't have theirs anymore. I'm laughing because that statement about like, we didn't have much money, but, you know, we didn't really know it. So both my parents were school teachers. We didn't have much money. And I knew it.

I remember we had like a car we had one car for a while we had one car it was a Chavette scooter a beige Chavette scooter with no air conditioning and The had like a crappy AM radio and and we would get get into that thing in the summertime to go like drive to see the grandparents Three kids in the back of the tiniest car So when people are like oh you know I was poor but we didn't know it I knew it I knew it I I knew it, man. I was like, I'm getting out of this joint when I can't. I'm having flashbacks.

So we had a similar, we had a rabbit. Remember these Volkswagen rabbits? Two-door, not four-door. And so my dad was from Texas. Occasio, we made a long drive from Virginia to Texas. No AC. Oh, my God. Oh, we have pictures of the four of us in this thing.

And, you know, it was good times. Yeah. And, of course, I mean, I don't want to make it sound too bad. When you have a car, you're not doing too bad. Right? And we've always had food. So thanks to my mom and dad and the teachers union that they got paid. And we ate. We got to eat all the time. But yeah. As far as not knowing you're poor, I definitely, let me rephrase it. I knew we didn't have much money. That much I do. I knew we weren't, I knew we weren't getting like, you know, a new bicycle. We might get a used bicycle. We might get a, you know, we always had some fun around Christmas time. the saying in my family was it's going to be a lean Christmas,

which had been inherited, I guess, for my mom's dad, who would say the same thing, it's going to be a lean Christmas. That's all we'd hear about. So whatever dreams you had for Santa, go count on it. Well, look, Echo would appreciate this being from Hawaii. Look, the big meal sometimes during the week was spam. Now, back east, that wasn't a thing. My mom grew up in Guam for many years, right?

So, yeah, we'll fire up some spam and put in the crock pot in. I'm like, what? So the running joke when I realized that spam really wasn't real me to see my mom. She signed me up for the spam of the month club. And I had a sweet shirt that said spam on it. And I would get this letter every month. So, you know, again, it took me a while to realize, you guys don't need spam at your house, you know.

So anyway. But so grew up in Norfolk, you know, good parents, normal childhood. I actually going to elementary school, I went, this was when cross-town busing was a thing. I don't know if they have that here in California, but back in the day that we would have cross-down busing in Norfolk. So I grew up in a place called Ocean View. I don't know if you remember that. I don't know if you were stationed back in the-

I was stationed. I remember where Ocean View is. It's a little sketch. We'll talk about that later maybe. So a cross-down busing was a big deal. So in first grade, you know, mom would walk me out to the bus stop, 45, 50-minute drive on bus to a school, Young Park Elementary, it's literally in the middle of the project, and it did, you know, they would cross down bus. And so that lasted for a couple of years,

and mom had enough of it. So she said, hey, we're going to find the money to send, she had, of course, I have her brother, parish, and, and we're going to send the boys to a Catholic school, because Catholic schools are cheaper than private schools, but great educations, good educations. And so we ended up going to this little private school. And she was so pleased. I think it was like $2,000. But, you know, but for those, it was real money, right? And so now it kind of changed the course of my life and fast forward a few years. So we grew up and grew up there and then went to high school. When you say that it changed the course of your life, you can't just throw that out there than to say, hey, we're moving on. What, just the focus on education.

Yeah, so the focus on, look, discipline, I think, is an important part of aspect of a Catholic education. Now, you know, I literally had nuns that were teaching us, right? So you have some discipline that's instilled in that. Some, you know, we're not Catholic either, right? So. Did you have to say that you were Catholic to get in that? No, no. Oh, okay.

They allow non-cathics to get in. Okay. And so, but, you know, I certainly believe in the morality that they teach. Now, I would literally have to go, today we went to Mass every. week and I couldn't participate right so literally for me it was like we're setting I just go and sit and I always remember it's nice and cool in the church were they still doing the in Latin no no no not at this point no not at this point how long ago is Latin services I am I can am I crazy no because they used to talk about that like because I thought they did Latin up until

fairly recently you know the 70s or 60s long before maybe I was I'm not that old job no they definitely didn't Latin but uh but but but But not for me, not for me. But I just remember, you know, we couldn't participate, couldn't take the sacrament. But it was cool. I would go as nice and cool in there and just sit and do whatever. There were a few non-Catholics, so we just kind of pal around together. We were that group and just would just chill as people would go through the Mass every week.

And that's cool, whatever. But how it changed my life is, you know, a good curriculum, a good focus on discipline and education. And candidly, a good moral compass was delivered. weekly, right? I'm not talking about Mass here. I'm just talking about, you know, how they went about their education, right? Look, if you look at today, there's a boom in Catholic education, given what's going on in education around the country. And so, you know, it was an important part of my kind of upbringing, even though I wasn't Catholic. It was important part of my upbringing. And then how long were you in that Catholic school for? Why went so second grade, so third grade on

through high school. Oh, all the way through high school. Yeah. So different schools, but still in the Catholic system. So all these little teeny Catholic elementary schools would feed up to the one high school they had in town at this time. It was called Norfolk Catholic High. And so my brother and I went there. And so my dad passed away when I was 14, so I was a freshman. It was tough. How'd that happen? Well, he, so he again grew up in Texas without a lot of medical care. And what they think was, so see, he had rheumatic fever when he was a child. And he was a child. And, you know, likely he never got medical attention until it was probably too late. So he literally wore glasses because the fever burnt his retinas, right?

So, I mean, remember, so he was born in the late 50s and, you know, in Texas, not in a big city. He was born in Dennis and Texas and literally lived on a cattle farm, right? So different mindset about health care and treating things aggressively. So, oh, he's got 103 temperature. he'll be all right, just, you know, just lay down here, some water, you know, we'll be fine. But he ultimately wasn't fine. So he had kidney failure a couple years prior, so he was on dialysis for that. And, you know, he would literally go on walks every morning to kind of keep in shape.

And he was then, built, not built like me. He was thin. And we'd go on these walks. And one day he just didn't come back. Please come to the house and we're about to go to school. my brother and I and my brother he's a couple years older and he would drive us at school and the cops literally came in the, we lived in a court, came to, drove through the court. And I remember we're just kind of sitting there.

I was getting a drink of water from the faucet and I made some smart-ass comment like, oh, they're coming to get this guy Roger Baker every year, you know, again, you know, rough neighborhood candidly. So a lot of guys, the police would come by all the time. And so he pulled right in front of the house and I said something else smart. my brother like oh what'd you do and so he comes to the door and he brings my dad's wallet and uh he said one of you guys needs to come with me and so my brother was the oldest and so he went um he went with the police officer and you know i was there alone in that house and um that's just a very

strange i mean when your child was 14 just turned 14 just entering in high school as a freshman and uh yeah And I called my mom and she came home and went to the hospital and he was gone. So at an early age, you know, when that happens, you have one or two things, right? You have to, you can either hide within yourself or you can stop him to try to be more of a man around the house. And my mom, you know, she's old school in the sense that, you know, she was very dependent on my dad. she turned into, we called her Tawanda after that, like she tried to be strong and do things that, you know, that she needed to do, take care of her boys.

And she did. But I had to become, in my mind, I had to become more of the man of the house and manage the finances and other things like that because she wasn't great with that. And so the interesting thing is she couldn't afford to send us to this school now, North of Catholic. And I didn't know this for a few years.

but the school came to her and said, hey, listen, if you can pay for one of your son, a child, my brother, then Matt can go for free. Big deal, right? So that's how I was able to go to high school, is that that school stepped up and allowed two knuckleheads to go to the school and when I couldn't really afford it. My mom couldn't afford it. And I found out many years later, but my wife, Sarah and I have, you know, We've given a lot of money back to the school, and we've endowed a few scholarships

for athletes to go to school. And it's just more than the colleges I went to, that was kind of the greatest act of kindness that set me on a course to be an entrepreneur and a businessman today. And so I love that place. And Sarah and I continue to get back to it. But so high school, you know, aside from that, pretty typical existence. I played sports. Not great like you guys.

I played football and basketball, marginal at football, you know, all conference. I think it made Allstate one time, but not great. I remember like junior year, it's about you getting ready to go to college. And look, to be fair, I was complete knucklehead. I might have had a 2.2 GPA. So your grades were not great? No, grades were not great. Were you just not studying?

No. Just didn't care. I don't really think I brought a book home. And, you know, and I have... I factually did not bring a buck home. Not a thing, I did not bring a buck home. Well, I mean, you have kids and some sons. So I literally, I have two sons now, and I would be appalled if that were the case for my son.

So, and looking back, it's like, God, what a knucklehead. So my mom worked all the time. I was a latsky kid. I literally, I saw her, you know, right before bed, and that was it. because she had to work. And so I remember going to a guidance counselor back in the day. And the guidance counselor literally said, hey, you might want to think about a career in the shipyards. And I'm like, what do you mean?

You know, mom says I need to go to college. She's like, yeah, but. Mom hasn't seen your grades. You're not getting into college, the lady said. And, you know, Norfolk is a home a bunch of shipyards, right? And so, and nothing wrong with working the shipyards, and I'll cover that in a little bit. But she was like, you need to go. Well, think about that as a profession, right?

So I'd go home. That was not a good conversation with mom. She never went to college, of course, but she'd always, she knew about this thing called college. She said, my boys are going to college. I don't know what that looks like, but my boys are going to college. And so thankfully, I could play football. Now, I should say that, you know, lightly. I could play football, was smart enough to kind of talk my way and play my way into college.

But D3, so D3, you know, I go play, you know, D1, so he's legit. But D3, I joke around, it's like 13th grade. So, and they also don't give any money to go to play D3, but they allow, at least for me, they allowed a knucklehead into school. So I was able to parlay kind of my average football skill into, and I'm a decent-sized guy, but I could leverage that into getting into college. And so I did. So this is interesting, too.

So I went to, which college go to? So I initially went to, you're going to a Catholic University. So mind you, here's a guy. I'm Episcopalian, like, and so imagine all my career has been educational back. Milking the Catholic system. You know. So I ended up at Catholic University. which is a division three school, but it's in D.C.

And so I played football there. But quickly, boom, blow out my knee. Ooh. Yeah, right. And I remember, I'm not going to that shipyard. I can't go back, right? So my mind had to turn on, turn the brain on. I remember.

What year was this in college that you blew your knee? So I graduated high school in 90. So it was 91. 91. So did you play a season or did you? No. Never saw the field. How did you blow your knee practicing?

Yeah. Okay. Yeah. And look, I had a couple looks from service academies, and, of course, that was never going to happen given my grades. But it was the only way I could really get an opportunity to go to college. And so I went to Catholic, blew out my knee. But because of my fear, I decided, okay, there's this thing called a brain.

You might want to turn that on. You're looking back. you're looking back and you say, oh, this is what I said. Do you actually remember a moment in time when you said, okay, I'm going to need to, I'm not going to need to apply myself academically? 100%. Okay. So you, that actually, because I look at my, people was like, hey, when did this happen?

When was this moment? And I, I've always, for the most part, had more gradual sort of, sort of realizations of what's happening in the world, including for myself. But that's where I'm asking. They're like, did you have a specific like, all right? Literally, because it's a binary event, right? So you blow out your knee, you can't walk. I was literally in the hospital, like southeast D.C.,

not the greatest kind of hospital that you want to be in. And literally in that bed, I said, I'm not going back. Not meaning Catholic, but I'm not going back to Norfolk. I'm not going to go back. What I got to do, right? So turned on the brain. I finished a semester there, had a 3-2, which is okay. I didn't, frankly, fit.

I didn't like the place. I didn't like living in D.C. And so, again, my mom, we couldn't really afford college, right? So she did a lot of research, and she found that there's a foundation in Norfolk called the Norfolk Foundation. And they literally, for underprivileged kids, they would send these kids to this college, ultimately graduate from called Hampton Sydney College, is in Virginia. It's a classic liberal art school. So when I say classic, you know, they talk Greek and Latin.

We had two years of something called rhetoric, and you had to place out of it before you could graduate, right? It is so old school. It's like a true academy. And I loved it, right? So it was small, less than a thousand students. Professor to student ratio was very high. And professors that taught there, they wanted to teach.

They didn't want to write to research. They wanted to teach. And it was a perfect environment for me. And so I went there, the Norfolk Foundation paid my tuition. What did you study? Economics and religion, believe it or not. So I have two degrees from there, one in economics and one of religion. People always ask me, what?

That religion thing is the late. Once you know me, you realize that religion thing, well, what do you have that for? Well, it's just, look, economics was pure. I wanted to learn more about, you know, the economy and how to be effective in business and things like that. my curiosity was really what drove religion, right? So imagine going to school at a Catholic school for all my childhood. And then, of course, I'm Episcopian, but I was just fascinated with the idea of how religions are historically rolled out and maintained and the effect on mankind.

And so we would study all kinds of religions. And so it was just a personal kind of journey of my own intellect, not, frankly not doing anything with this as you can imagine yeah well no if i was in the fbi and saw that thing pop up i would have pegged you as a cult potential future cult leader economy and religion all right we're going to watch this guy he's going to be making moves well look so i wrote my senior thesis on something called the morality of capitalism um so i tried to blend them together that uh did so did you know you wanted to go into business at this time where you started to think we did you see some kind of a career path was there anything an interest

did you? You know, I knew I didn't want to go into a traditional profession. When I say profession, I mean, true profession, so, you know, law or medicine or accounting. Like I, my mind wasn't linear that way. And I always knew that I wanted to pursue something in business, whatever that might mean. Like, it's so, it's so ambiguous when you say, hey, yeah, I want to go into business. Well, what the heck does that even mean? What does that look like? And I just knew I wanted to have the tools to do that jocco to go into business and be successful it was later that i learned kind of what specifically i wanted to be involved with in business as i met some mentors but uh at hampton sydney now i just knew i wanted to get some degree and and uh that i felt

like could best prepare me to be a successful in business and so i did my as i said i got this norfolk foundation scholarship right so and i get there my my dad's gone No one of my family has ever to go into college. Mom thought this was, and I thought, hey, okay, look, this is cool. I got this all paid for, right? Well, I get there, and what I realize, they pay tuition, but there's a little difference between room and board and things like that. So I'm a hustler.

So I've always worked, even in high school, like it's just part of the Malone mindset. We've always worked. I remember I was working at a marina at 14, sanding the bottom of boat so they could paint them. Now, mind you, I didn't even have any kind of face mask on, like today with my company. Like, what were they letting me do that for? Because you were 14. Right. I better not say the marina.

But I was paid in cash. And my brother worked there. And he got the good gig. So he drove one of these huge forklifts where they stored the boats. And, you know, they were huge forklift. And I was an idiot that would climb up on the forklift, get in the boat as he put it in the water. So I could drive it and park it. So when the guests came, they could pick up their boats anyway.

So we'd always been working. And even in high school, I think you appreciate this. And you might know these guys. So I was a lifeguard of all things in high school, believe it or not. So I worked at this Ocean View Beach Patrol. And a good gig. Paid a lot more than Marina. Didn't have to work as hard.

You can kind of work out and have some fun. You're not breathing lead paint. Right down your throat as I look at it. Now, you know, people always joke, hey, were you there for the ladies and stuff? I don't think you've really been to Ocean View, bro. There's really no ladies there. It's a pretty rough place. Like we used to work at this place called,

there are a couple beaches there in Norfolk, and we worked at this place called City Beach. And City, there's a big development now, it's replaced it, but City was kind of way down at the end of the bay, and that's where you could get the hotels you could get for the hour, right? And hookers on the corners and stuff like that. And they only let the big guys go down there to City,

and we called it, of course, shitty. We're going to go hit shitty. What I love, though, is we had rescue boards. So we basically surfed all day because the clientele didn't roll. And mind you, surfing out in Norfolk is very different than here. It is. But we felt cool, Jacco. Come on.

So, you know, you get there, you get on duty at 10. And clients don't really show up at that beach until about three. So we kind of screwed around. Well, there's a couple characters that you meet during being a lifeguard, right? So you have the quintessential guy that that's his profession. You know, the dude that's like, you would call him dude. His name was Jed. Like, he was 40 years old.

You're like, okay, I don't want to be that guy. But we had these a few guys that went to college at Old Dominion and that were just working there for the summer, making good money. And I never forget, this one guy, he was a workout maniac. So he was a wrestler at Old Dominion. And our lifeguard stands are about 10 feet tall. And he used to hang off these things and do pull. pull-ups and then he would do one-handed pull-ups you know he'd grab his hand to

complete legitimate and I was in high school I this this was cool to me right so on his hey I'm not I'm way out of high school I'm a fat ass can't do that's pretty cool so on the lunch breaks though this guy he wouldn't go on lunch he would literally jump on the beach take off his lifeguard gear and dig holes he take out of military shovel and dig holes as deep as he could as fast as he could for an hour and then fill him in, that's, no, lunch break was an hour. And I remember asking him, I said, what do you, what do you, I love it, but what are you doing? He says, I want to be a seal.

I said, huh, what's a seal, right? And so at City Beach, it's right across a jetty from the amphib base there, right? And so you'd see copters out there dropping people, and I didn't think there were seals, but they'd drop, you know, divers in or whatever. And because I was so busy down there at that beach, I could just sit there with my panachsh and watch. You see him swimming back, right? They just swim back and you say, man, these guys are out there a long time.

And he would say, well, those are probably seals. And then he came in one day and gave me a book, Rogue Warrior, the classic, right? So, of course, there's a lot of reading time sometimes on these lifeguard stands because no one was there. So Marcinko I read that book, and it was funny. the other day. I was working out with retired seal

and I had this I stole it, I shouldn't say that, but I have a lifeguard sign in my gym at home, my garage. He stole it. I found that city of Norfolk, I found that. So we're working out and he says, hey, what's that sign? And I said, well, I worked at,

I worked at this, I worked at this lifeguard thing and then I remembered the story of this guy that wanted to be a seal. And I said, hey, did you ever know this guy. He's in his face, he looked at me and said, you're kidding, right? So, so his name, and I haven't seen him since, Jocko, so you should know this. So his, they had two guys that worked there. They're called the Fussell brothers. That's what we called up. John and Chris Fustle worked as lifeguards with me back at the day, had Ocean View. John Fustle was the guy that

would just work out maniac, like hanging off lifeguard sands digging, whole. and, you know, when I mentioned it to Flint, do you know this guy? You're kidding, right? So I did use Interwebs and check them out. So I guess they made it and they had a pretty good career in the SEAL team. But I literally remember this guy hanging off the lifeguard stand doing, you know, one-on perlops. So he made it. Good for them.

Yeah, yeah, right on. So a small story there. But, you know, always working. So when I get to college, of course, realized I had to figure out how to eat and where to live and things like that. So I got a couple jobs. One of those jobs was I was a bartender. Now, so I went to the school as in the middle of the mountains of Virginia, so not much in the light life.

But I worked for the school, so I would work for these trustee events. So trustees in college are folks that, you know, kind of sit on a board and give a lot of money and kind of direct the college and where it's going. So they're typically pretty successful folks that can afford to give a lot of money away. and, you know, I had exposed to any of that world before. And so I was working these trustee events and, you know, I had to wear a bow tie and it was pretty horrible. So I stand there and have this bar and this gentleman freshman year came up and he wanted a scotch and eat. Really good at making those.

So, and so we just got talking. For four years we talked. And again, not about business, but about life and politics and sports. and, you know, he really became someone that I look forward to talking to. And his name was Bob Hatcher, and Bob had started a company that called Johnson and Higgins, which was one of the largest insurance brokerage firms in the world. He later sold it to Marsh, and they are the largest. And, you know, I don't know what he was worth, but it was a lot.

And I remember senior year, he says, hey, Malone, if you ever, if you ever, if you ever, need anything, give me a call. And, you know, okay, what does that mean, right? So again, you know, naive. I said, yes, sir, Mr. Hatcher, thank you, you know. So anyway, so graduate Hampton, Sydney, the brain turned on, believe it or not, five beta cap, which all these, you know, pretty high GPA, which is what it taught me was, look, you focus on anything, you bring some discipline to your studies. Most people can achieve anything, right? Especially in school. it's not that hard. You just got to be disciplined about it.

And I took it as my job. Like I was there to find a pat to get out, get the highest GPA I could, to theoretically get me the best job that I could. So as I'm finishing up school, one of the deans of the schools comes to me and says, Hey, Malone, I want you to apply for the scholarship. And of course, I heard scholarships are free. And I said, okay, what's this about? And he encouraged me to apply for something called the Rotary Foundation scholarship.

Actually, the Rotary Ambassadorial Fellowship, very fancy. And through the Rotary Club, well, apparently I have Rotary Clubs throughout the world. And part of this ambassadorial role is that you go to these countries, wherever a country you're designated, and you speak to Rotary Clubs in that country every weekend. So you travel around those countries giving speeches about literally life in America and where you're from. It's truly ambassadorial. And in return for that, they pay for your graduate school. It's a good gig.

I'll give that a go. And so now I can only speak English. And so, you know, that limits to where you can go in the world. Australia or the United Kingdom, right? So being an economist, I use that phrase loosely. I knew, of course, of Adam Smith. He actually taught at the University of Glasgow in Scotland. There's a school there called Adam Smith School of Finance.

And I applied to five. The way it worked is you have to apply. And then the Rotary Club picks. And so, of course, I pick the big boys. I applied to Cambridge and the School of Economics. You used to the big boys, right? And on the fifth choice, I applied the University of Glasgow. Now, what's interesting about Glasgow, it's very similar to Norfolk in the sense of a huge shipbuilding town, depressed economies.

Because most of the ships at the back at least early on, a lot of the shipyards for the United Kingdom, all the boats were really built right there in Glasgow. And so, of course, that's where they select me to go. And so I ended, I wish I'd gone to Cambridge or Oxford or one of these places. So I, of course, end up, in my luck, going to University of Glasgow. But hey, man, it was free. So I went. So off I go to University of Glasgow in Scotland. and yeah, that was a good experience.

The school was like 1491 it was found. I mean, so it's you going way back, right? Definitely back in the day. My classmates, you love this. My classmates were really, it's an international program, so my classmates from around the world, right? So my roommate was a fellow named Carl Howe, who's from Barbados. And, you know, he spoke a different dialect of,

English. And then, I don't know if you've been to Glasgow, but Glaswegian, obviously, English, but their accent are so thick. So imagine, I'm, I got this dude from Barbados, me, and all these Glaswegians, it's like, it's, they're all speaking the same language, but they're in barely. So, I did, uh, I did the master's program there in international finance. I really wanted to get out of there. So I did my program pretty fast. I did it in, um, 18 months. You could write your dissertation and finish. And so I finished. But because I finished early, I came back to the States. And at that point, Jack, I wanted to be, I thought, an investment banker. So for your listeners out there, not to offend many investment bankers. So investment bankers

put buyers and sellers of companies together. I have a lot of investment banking friends. So I apologize for this, but they're like real estate agents. but really smart, and they make a ton of dough. So in my mind, I wanted to be an investment banker, you know, kind of facilitating acquisitions and putting buyers and sellers together for businesses. And so going back to the States, I was off-cycle, so they have a recruiting class.

So they bring in students and put them in the associate program after they get their MBA, which my degree was equivalent to that. And so I was kind of six, seven months early for that program. And so they said, hey, just come back when we recruit for the program because it's kind of a couple-year program. You've got to get a spot, a slot, and you'll go through the program. And so I called Bob because I didn't have a job,

and I said, hey, Mr. Hatcher, guess who? And he says, hey, Malone. So I wrote this dissertation on derivatives in graduate school, and so I went to work briefly for this insurance company. And I literally wrote what's called exogenous risk models where I would invertly correlate commodity prices and self-insurance levels. It's very technical, very boring.

We both seen trading places, so we kind of go. There you go. Same thing. Yep, something. You're right. So I literally would build these models. You got here. I literally was building these models.

So a lot of big companies are self-insured. Some companies have massive exposure to their earnings based on a commodity price of something. So like take Reynolds metals, for example. So Reynolds metals, their earnings are probably driven by the commodity price of aluminum. Well, if you're self-insured to some level, and aluminum prices go through the roof, you had taken more and more risk.

So we kind of wrote these and developed these models, derivative products that as the commodity price of, in this case, aluminum would go up, your insurance would kick in so your self-insurance would go down. So it allowed the company to have less risk. Yeah, I realized in about a month this is really cool, but it ain't for me.

I'm not sitting no Q you doing modeling for my career, right? So I said, hey, Mr. Hatcher, thanks for the look. So I can't do this. I'll wait out for the program that I'm going to go to somewhere else. So he actually called this fellow that ran this investment bank and said, hey, you get him a loan on board until he gets to the associate program at your investment bank. And so I went. But again, early, they were in the middle of a big project.

And I joined this project. So it was kind of like process reengineering. So this is that a new company that you're working at? Yes. So I left Johnson Higgins and went to. It's called Wheatford-Burchase. It's no longer there. Someone bought it.

I walk over you, I think, bought it. But imagine clearing trades, again, very, very exciting stuff, right? So imagine how broker-dealer's clear trades, literally clear trades. You know, equity trades are cleared, but also, you know, municipal bond trades, how the technology works and how the process is and the regulation around clearing those trades and all these systems have to work together to do that. And they had, they had, they had started clearing trades for a bunch of different mom and pop broker dealers and some big ones. And so, you know, think about it from a business standpoint. They were bringing in all different

types of people to do trade businesses to do trades. So if the three of us start our own broker dealer, we would hire them, they do all our back end stuff. As big as, you know, the big guys on the street, first cleaning corp was the name of it, where they would do their. work too. Well, anyway, I got into this project to figure out how to make that more of a business and things like that. Again, just waiting out to get to investment banking. But I actually started to fall in love with the operational component of what we were building. And, you know, I actually made the decision to decide not to go into investment banking at that point. And the consulting firm that was kind of leading that project, strategy consulting firm called Ernst & Young at the time,

they hired me to work with them on doing these types of projects. And so I joined them. So I kind of left the guys hanging there in investment banking. But it's the right choice for me. I didn't want to be transactional, if that makes sense. I didn't want to be a middleman. I just didn't want to be in the middle. I wanted to be building things.

And I thought giving input and value to what I was doing. And so fast word. Join Ernst & Young, they said, hey, you can go to New York or San Francisco, and that's where they had their offices. And so I went to San Francisco. I'm not a big fan of New York. And I've been there one time, to be fair. So when I interviewed for the job with Mr. Hatcher, they had this big skyrise down in New York, right? So you go, and they have what's called an executive dining room.

Okay. And they all wore white shirts and ties. I never, it's like on the 40th floor, some big high rise. going through this executive dining hall. It's when I knew I didn't want to have an executive dining hall, right? So, anyway, so, and I hated New York. So we moved to San Francisco, I moved to San Francisco and started my career there. And Kenyon, one of the biggest mentors that I met in my life,

surely thereafter, was a guy that was the COO of the NASDAQ stock market. A guy named Pat Campbell also served Air Force, but he kind of took me under his his wing and at the time the NASDAQ was on a buying bench. They were trying to buy up stock exchanges and they bought the American stock exchange, which is really an option exchange. And I worked for him as Ernst & Young doing what's called post-merger integration, PMI. So merging these two companies together. And it was, look, it was fun.

Putting two companies together, understanding how that works. Frankly, we do that now at Groundwork. So that was a good learning process for me. And then a few years later, not even a few years later, maybe 18 months later, I got this call from my friend Bob Hatcher. And he says, hey, Malone, I want you to go meet a guy. And I said, yes, sir, Mr. Hatcher, whatever you want. You know, this guy's, you know, he's really helped me. And so I'm living in San Francisco.

And he says, hey, I need you go to San Diego. Go meet him in San Diego. Are you communicating with him on a regular basis? Never, no. He's just reaching out to you. Yeah. So you just made such a good. impression over pouring him scotch over those years whatever gigs you did for him you did a good

job built a good relationship with him and he liked you i think so i think he identified with being he just loves scrappy grinders i mean to be fair that's that's what it was he just he's i think he saw himself and me and when you see you see the like-kinded young guys you want to help and i think this was this was his way of helping now mind you his way of helping was just a a little push and a little nod. Like he didn't make it happen, although I may in some cases he did, but he didn't, you know, he was just, he was there to help push and prod and, look, it changed the course of my life. This one guy where I was tending bar in some college to try to pay my way and change the

trajectory of my whole life. And anyway, so he calls, Jockey calls, of course, I'd never been to San Diego. San Diego is good to me. Like I've been here a couple times and big things happen. want to get here. So, uh, so I hop on the flight from San Francisco and, you know, this is, again, this was probably in 97, you know, technology, you know, we don't have smartphones, right? Um, it was, I was going to meet a guy, right? So I get on, I get in the yellow cab. No, we were at that time. And, and I give the, the driver the address and we're, we're scooting along and he's like,

are you sure this is the address? I'm like, yeah, this is the address. I checked us. Yeah, this is the address. So five minutes later, he's like, mind you have a suit on, right? Meeting a guy. He says, hey, bro, you sure this is the address? And I'm like, well, it's the only address I have. Why do you keep saying that? He says, well, you're going to San Diego Zoo.

Hi, Louis. I said, fucking Bob just punked me. You know, that's literally what I thought is, it's okay. I said, well, look, there's the only address I have, so I'm going to continue on. So we went to the San Diego Zoo, and I got out, and there was a, This is in the evening time is about 5 o'clock and people were leaving, but there was a little side thing that they were having this event for. And they had partitioned it off. So I go there and I meet the guy I'm interviewing with.

His name is Marvin Bush. And Marvin is the son of 41 and the brother of 43. And he owned a hedge fund and a private equity fund back in D.C. And Bob and he were friends. And the way I understand the story that Marvin was at a party. with him. And Bob was an investor, by the way, in his firm called Winston Partners. And Marvin was saying, look, I really, I really need a young, scrappy guy to come join my team. Boom. And Bob says, hey, I got a guy. So I go to San Diego. Of course, I meet Marvin San Diego,

and boom, got the job. And this was, so this was in late 90s when, so think about this. So private equity at the time, so private equity for your listener, so private equity is, is, a unique category in the sense of it's an alternative investment category. If you think, if you think about why it even exists, you know, many of the investors in private equity tend to be pension funds and colleges and endowments. And just the unfunded liabilities, for example, with pension funds today. So unfunded liabilities would be the difference between what they owe the folks that are part of that pension and what assets that they have. There's always a big delta. They always have to pay out more than they have because the cost of medical and whatever the paying from a pension standpoint is higher than what they have.

So they have to invest that money. They invest that money in a lot of different vehicles, including public markets, but also private vehicles, alternative vehicles, of which private equity is an alternative vehicle. Like if you were to look today, it's striking that the unfunded liabilities for pension funds in the United States is something like $3.8 trillion. So they're trying to make this up. How are they making this up? They're making it up through hedge funds and private equity, where they get an outsized return vis-a-vis the public markets or vis-a-vis, you know, bonds. And so the growth that you've seen in private equity, when I joined this private equity firm that Marvin was running,

so this would be 98, 99. The number of private equity firms at that time were under 1,000. If you were to look at it today, there's somewhere around 4,000 private equity firms, and they manage $5.8 trillion. So back when I joined this private equity firm, there was a category, but it was kind of new. But I knew I wanted to be in it. And by the way, so private equity and venture capital, same category, but different kind of investment focus. Growth capital is different than buyout, things like that.

Well, Winston was a buyout shop and a microcap buyout shop, which meant that they focused on companies sub-50 million dollars in total enterprise value. And he was looking to add an analyst, an associate to that team. And Bob mentioned you need to go hide this guy. So move back to just outside of Washington, D.C. And mind you, look, this is kind of surreal for me, right? So went to college flying around with NASAC to buy stock exchange. changes. That's weird. Then working for the president's brother, you know, super nice guy, super smart, hated politics, but legitimate businessman and learned a ton from him. You know, I get to this office

and outside of D.C. and McLean, I thought, bro, I made it. This is like, this is the pinnacle, man. Like, I grew up in Ocean View, you know, so couldn't afford to go anything. And so you're here and it's very surreal. And I remember maybe three or four months into the job, and I had my job, my own office, which is a big deal. Marvin walks in, and he sits down just like this. And he kind of sits back and he says, Maddie. He called me Maddie.

Don't call me that. But maybe you can because you're a monster. He says, Maddie, do you trust me? What do you think I said? Yep. I said, no. Oh, dang. I said, no, I don't even know you.

And that was a turning point in my career in the sense that, so that's why I was there. So at this firm, there are guys from Harvard, business school, and Wharton, double. My direct boss was a guy named Steve Frye, who I still work with today, went to WVA. I mean, legitimate colleges, right? And then you got some knuckle dragger like me. colleges you've never heard of but I think what Marvin wanted was a mutt and what that means is

and what I've later learned what that means is so a guy that will always speak the truth whatever he believes the truth will be the truth is for him and I think he realized that I wasn't looking to climb the ladder like I wasn't just a yes man and I was just so raw either naive or stupid

however you want to define it I was just so raw he loved it and he he slapped the table and walked out my office and said that's why you're my mud that was it right all it's good so that that was a that yeah that was in retrospect you know that was a big turning point in my career and he you know he involved me and everything and there was some trust there because I just wasn't one of those yes men and I look at the guys that I worked are super smart super talented guys but I felt like I needed to stay there and earn my spot so I outworked them. And, you know, mom said a long time ago, and I'm embarrassed to say this, but

she said, honey, you're not the smartest one they've ever created. But if you work 10% harder, you'll be just fine. And that's literally how I've lived my whole life and my careers. I will not be outworked in my mind, right? So I all will not be outworked. And so I always figured if I come in an hour before they do, that, you know, that's, for me, at that point, that was five to six hours more a week. If I stayed an hour later, you double that, right? At the end of the year, effectively, I've gained a month of working time on them. And you also set the tone, right? So you set the tone, is that young guys here longer than me? And that's another good message. You know, my good friend and partner, Kim McDonald, we call it Guard in the Castle. I still do it

today. So I like to be the first in and last out, even at this big company that I run, because it sets the tone that, you know, I'm not some executive that's going to mail it in. If we're going to go after our mission, we're going to go after it, and I'm going to be there to do it with you. And so at Winston, I spent, you know, close to eight years there doing deals. So private equity deals. So we would buy companies and invest. And I wouldn't operate them, you know. So at this point, this is a traditional private equity.

We would buy these small companies. We would invest in them, sit on the boards, you know, try to provide wisdom. but in reality, just really providing capital and trying to direct them to good outcomes as a business guy. And so I enjoyed it. I loved it. And frankly, I loved working with entrepreneurs

because so these are small companies, right? So they're not as sophisticated as you get upstream. You get large-cat companies. You have professional managers. You have professional investment bankers that are involved. You're still buying companies that's being operated by the founder.

100%. 100%. And it was perfect. are street fighters. I loved it. You know, there's no like Harvard MBAs running around kind of managing. They're guys literally working, you know, if it's a construction company, for example, they're literally driving hard equipment.

They're managing, they're doing the work themselves while trying to manage the business. And so I thought I could add value many of those cases. And that, frankly, is kind of where I cut my teeth for what I wanted to do. Learning and watching these founders and what I would pay them for their businesses, I would sit there and go, my God, this guy's about to make, you know, 50 large, and I think I can do that, you know, you know. And so I did that for a few years, almost eight years. Great team, great Marvin and I, you know, he's, he took a chance on me.

We didn't need to, Jocko and that guy, you know, he comes from a great family, but this guy also, he burned the midnight all and worked hard, and it was a pleasure working for him. He comes in, he comes in one day and says, hey, Maddie, you might want to get your CV together. This is, CV is fancy for resume. And I was like, oh, man, something big's going on or I just got fired. I'm not sure which. And it turned out they were, he had a partner and they were separating the firm. You know, talk about, you know, partnerships sometimes don't last forever.

And so they were going to separate the firm. Never forget this. So I get up out of my sweet office and I walk down. the hall to Marvin. And I said, hey, Mara, I think I'm going to, I think I'm going to go. I think, you know, you don't want to be part of a firm that's kind of an disarray. And I said, I think I'm going to go try something else. And he says, Matt, I knew you'd come down here.

And literally, I ended up a couple days later meeting with a guy named Ray Hunt and Dallas. So Ray Hunt at the time was Fortune 50, which means he's one of the 50th richest fellas on the planet. He owned a big oil business. But he also owned his own big alternative investment group. When you got that kind of money, you invest your own money, right? So he had a team of folks that did all alternative investments. So from real estate to venture capital to leverage buyout.

and I joined his leverage buyout team and was offered the opportunity to look all their offices were in Dallas and I was given the opportunity to open their first office outside of Dallas which is a big deal. I was going to build my own team, leave my own deals.

And so, you know, I got to pick Atlanta or Charlotte to do that and I opened my office for Hunt Private Equity in Charlotte, North Carolina and did, you know, did some cool deals. It was fun. Again, think about the progression here of Marvin to Ray. And these are some players. Players, as they say, right?

So fast forward a few years. This was in 08, 2009, the world's going badly. Oh, yeah. So what was the, how that all work out? Well, we had, at that time, we only had three active portfolio companies. We just started actively investing. And all three of those were my companies. and there was kind of this decision to make about what are we going to do with these companies

if things go really bad how are we going to support them things like that and mind you Hunt although you know very wealthy he has other interests in particular energy and running energy company takes a lot of capital and so my hairbrained ideas I was going to buy the portfolio from Mr. Hunt and and so I went down there and I offered to buy the portfolio and I he agreed and how did you structure that deal so three active portfolio companies so I knew the enterprise values of all of them and mind you look I didn't have the money to do it that's why I'm asking you how you structured that deal you talk about hustling you'd love this jacca so so I got him to agree to the deal right what was

going to be so total enterprise put them all together what the total purchase price would be what the return look like for him we would take these portfolio companies into a new fund Now, then I, once you said yes, I was running around trying to raise the money for Cid investment vehicle to buy this portfolio. Got it. So you did a little raise? Attempted to do a little raise. I was going to say, because this is what, 2008, 2009? Yeah.

So you weren't raising much, bro. Well, the ironic thing is I found the firms to back me. We were going to pull it off. But the companies that we had invested in were performing so well, literally. these are kind of recession-proof businesses that a billionaire says, no, I'm deciding not to sell these companies. That's what he does. And so he didn't, we wouldn't able to pull off that transaction. And mind you, I didn't have any money. So I've spent. So wait, so he reneged a little bit? Careful here. That's the hardest thing you say. He made a different decision. He decided he was going to

keep him. Yes, sir. Got it. Yes, sir. And he looked at the performance. He said, man, I'm not losing money. These things can last forever. I'm going to keep them. And so he did. He did. And so envision this. When you go to your boss and say, hey, I'm going to take you out, I want to take this in a different strategy. I know the economy is terrible. You're going to focus on energy. I'm going to buy this portfolio. It doesn't bow well for your career. So that was kind of my end of my career there at Hunt. So I had started this firm that I called at the time I was doing the raise with these other private equity firms called Succession Capital. And And it's a private equity firm I own today.

And the phrase succession literally means when you think about all the great businesses built by boomers of the last 50 years. And I had always thought to myself, look, I'm going to have my own private equity firm. I'm going to buy my own companies. And if you looked at all the folks that needed to retire, the boomers needed to retire, and the data really is clear on this, that second generation businesses never work, 30% success rate. Third generation

businesses around 12%. I think that that's incredible, right? So you have all this wealth that's been created, locked up in these businesses. So we got the boomer creates the business. Yes. And that business is doing great. When that boomer steps away,

it's got a 30% chance of survival. If you give it to your kids. If you give it to your kids. And if that survives, you got a 12, it goes to the next set of kids. This is just classic. Classic.

We see this over and over again, right? Right. Well, look, they don't work to get it. They never struggle. They never went through everything that's required to get it. So, hey, man, if daddy gives you a business, you need to show up. The business starts interfering with my golf game. It's just not happening.

Exactly. So that was kind of my mindset. It's like you have all this pent up value in these companies and smaller companies and that I would just go and buy them and allow that owner to monetize their life's work. and some of this you probably recognize this some of the smart business owners they know they're not giving it to their kids we see it every day today and some of the businesses that I buy

not that they're bad kids but they're not going to run a business they're not going to run a business and the owner the person that built it they want the money to live whatever lifestyle they have left they don't want the company to slowly pay them out because think about this how would a kid buy a business well one way to do it is that the company that they were given finances that exit for the parents.

Well, you can't fly around the world enjoying life if that's how it's done. And so my pitch to some of these owners was, hey, look, succession will buy you. I allow you to monetize that great build and they go live your life and do your thing. And so that notion was always in my mind after doing private equity at that point for 15 years or 13 years or something like that. It was always in my mind. and then the event at Hunt kind of catapled that right into existence. I formed it. I was going to put these three portfolio companies in there.

And then, you know, I ran around, spent, you know, I don't know, $150,000 of my own money trying to get this thing off the ground. And, you know, of course, that's all zeroed out at that point because we couldn't buy the portfolio. And so here I am in Charlotte. I had enough money to kind of keep me plugging away for maybe a year, 15 months. My goal was to try to find a company. That's what I was going to do. So you're still sitting on the money that you raised?

No, no, no. Okay, so you didn't do that. We never closed. Never closed. Got it. We turned the purchase agreement twice. That's a tough one. It's tough one, man.

Like, oh, God. Yeah. Anyway, a good lesson. Never go against a billionaire joke. I've done that twice in my career and I've definitely lost twice. So I'm a slow learner sometimes, I guess. So I'm sitting there in Charlotte. Trying to find businesses.

And the problem, Charlotte's a great city. The problem with Charlotte, though, it's full of, you know, commercial bankers and investment bankers that all are looking for little businesses they can buy. So they can,

and there might have lifestyle businesses, right? So it's pretty competitive to find a business in that market. As I'm looking for businesses, I had a friend, Jimmy Flowers, that, you know, we had bought one piece of real estate jaco that,

so Wachovia was melting down at this point. So this was like during the Great Reception, right? So Wachovia was, Are we talking? 08, 2009. Okay. God. Rough.

Brutal. So I try to make it run of the portfolio. Got nothing. And, you know, I really can't really get a job. I could get a job. I'd suffuse to get a job. You know, I'm going to make a run at this. So I'm looking at myself.

Can you married at this point? Yeah. You got kids? Yeah. My son, Aidan Malone is, yeah, yeah. Yeah. Yeah. It's not fun.

Yeah. Because, I mean, you can just get away with anything. When you're single, no kids, you're like, cool. I'll sleep, you know, I'll sleep in the van. Man, it's all good. We can make it work. But when you got the wife and kids, you know the phrase,

burn the boats. Yeah. Yeah, man, that was it. Like, I was not going to lose. Now, I didn't have a path to, like, where that was going. Yeah. I've had that discussion.

I had that discussion with my wife. And I've told people about this. You've got to figure out what your minimum standard is. And you've got to figure out what your wife's minimum standard is. And I had the conversation with my wife a few times where I was saying, look, if this doesn't work, I'm good with living in our RV and we're going to travel up and down the coast of California. I'm going to surf and we're going to hang out.

We're going to go a bunch of different jihitsu schools and we'll live off my Navy retirement. And I'm good with that. I need to check if you're good with that. And she's like, oh, it sounds good. It sounds like fun. I'll get to see you more. And I was like, okay, cool. You got to figure out what that minimum standard is going to be.

Because if the minimum standard is, hey, I at least need a house or I at least need a house, you know, with three bedrooms or four. What's the minimum standard? You got to have that conversation sometimes, and I gave this advice on the academy the other day. Someone was asking about, you know, I'm going through this transition period. How do I address it with my wife? And I said, look, you're going to take risk,

not just with you, but it's with your wife. Figure out what the minimum standard is and then make your decisions. And that you have a lot, your minimum standard is a lot lower when you're a solo dude, right? You're flying like, there's no minimum. I really didn't even have a minimum standard as a person, right? As an individual, I had no minimum standard. I could survive literally with nothing.

Yeah. We'll get it done. But figure out what that minimum standard does. So you had your wife. You had kids. Was your wife okay with living a van down by the river? She would have been. That's what I'm talking about.

Ride or die. Best thing ever happened to me. So Sarah is all in. She's always been all in. You need that. When you look from now, you look back and say, oh, yeah, easy life. Right, because I've been pretty successful today, but, bro, back in the day, it was, it was, it was, it was not always this rosy. And, you know, her being, you know, 100% supportive. It tells you everything you need to know. When, when, when, when things are hitting, everything is great, it's easy to have a relationship, right? But when things are bad and you don't know, and we had some money, we weren't living on the street, but, you know, it was, it was running out fast. Lean Christmas. Yeah, I'm bringing out the spam. Hey, mom, what's that recipe?

So, you know, I'm just, again, at this point, just scrapping, right? I'm hustling like nobody's business, and we're sitting there, we're looking for businesses, and we get a call from a fellow that, a family office in Chicago billionaire that had put a lot of money in a MES fund. So a MES fund for your listeners is, you know, you got traditional equity where you put in your money, you don't get a kind of dividend or annual return, you get the upside and the gain. Debt, of course, is your traditional debt where you have to pay some kind of interest on it.

Mez is in between. Well, you have a mezzanine strip or mezz debt where you get an elevated dividend. So it's higher than a bank. The risk is higher, too, but you pay more than a bank. You'd have to charge a bank. Our bank would charge you. But you also get a little bit of equity upside. It's popular in real estate.

So he calls, my friend Jimmy gets the thing and says, the call and says, hey, yeah, we're going, they knew Jimmy, and they said, hey, look, we have this MES investment in this fund, and this, and they're holding this thing at cost, which this thing would be this big building in Shirley, it was Charlotte. It was a big construction project they had. And if you're in 2009 and 08, if you're holding something at cost, you're lying. Because they're saying, hey, look, you put $10 million into this. We're telling you it's still worth $10.

So the guy calls and says, hey, flowers. at Amore 10 So Flyers says hey Malone Let's go check this out So we hop in the truck We drive to this building We look at it's a 109 unit building

And it's literally empty It's literally empty Like residential like residential units Multi-family residential condo Development So we're looking at each other And of course we're scrappers Like how do we monetize this?

Yeah you're looking at that thing You look at that thing Like it's a hamburger son I don't know much about real estate but I do now. So we looked and James said, we just get a fee. We can help this guy.

And I said, no, no, no, we're going to, we'll do something different. So I called a guy that I knew in town. Is the project done? Done. Oh. Worst case in there, right? So if it's in construction,

you can delay it a little bit so that you can finish it and sell an optimal price as the economy recovers. This came online, the average square foot cost of this building was likely 3X, overvalued. So if you're buying a condo in Charlotte at this point and you're paying this price,

you're a fool. It's three X too expensive, which means, by the way, your, your mes debt and your equity, prior word nothing. So we do this work and we call the guys back and say, hey, listen, we'll come see you tomorrow. Now, mind you, broke again. We're flying coach to Charlotte, back of the bus, right next to the lab. And we're getting up there. And I put this big proposal together. And so we get up there and our pitch was simply this. Hey, look, I had met the guy that night. I called the banker that I knew who actually was banking the deal from a senior perspective. And he controlled the debt. And he shared with me, hey, we're sellers of this debt. And I offered him on the phone a number. Mind you, I didn't have the money to do it, but I said, okay, I'll pay you this for it. He said,

we're done. I said, we're good. And I said, okay. Next day I'm on the plane going up to see these billionaires and our pitch was simply this. Your mess is worth zero. The good news is that we're going to buy this note, we'll capitalize a little more, and we'll buy this asset. Here's what your return will be. You give me 18 months to sell off this, reprice the asset, and you give me some runway to start marketing this building, you're going to make a great return.

Caviard being, we're going to share profits. I'll do all the work. I'll literally sell the units myself. with my partner, Jimmy, at that time. And they agreed. Now, mind you, like, I don't know anything about real estate this time as a PE guy, but I could learn pretty fast. And no offense, it's not that complicated, right?

So we got after it. So our first big project, Excession, was really a real estate project. So we disposed of all those assets, made a lot of money. And second lesson from a billionaire. So we're making so much money. The final payment, the guy calls us and says, hey, you guys are making too much money. We're like, hey, well, that's the agreement.

We're going to share the profits. We put in the work, you know, roughly 19 months of hard labor to sell these units. 109 unit building. And he said, no, no, I want another half a million. So what do you say? You said, yes, sir. I mean, what are you going to do? He literally said, look, I'll tie you up in court for five years.

You'll never see that money. I'm like, okay, well, there you go. So another lesson, a hard lesson. But we did that. That frankly helped me capitalize succession and allowed me to kind of push our model to where it is today. I knew I didn't want to be in the real estate game, although we have a real estate division today, income producing properties. We have about 30 income producing properties today. It's a great business.

Jimmy Flowers, my partner runs the real estate component of that. But my passion is operating companies. And so now having a little bit of capital and, you know, no lean Christmas at least that year. I found a company So ultimately found a company back in Norfolk That was called Petrochem Recovery. I bought this business from the Fenska family

Super family It was the environmental services space So think Anything that can't go in a water treatment facility Or a landfill This company would clean up and dispose of Great family, great business I don't know anything about that either

But literally I wanted to cut my teeth On being a true operator So I bought the company, 23 employees literally a thousand square foot office mind you so think about this I'm flying around in private planes working with some of the biggest guys in the world now I'm in Norfolk at 1635

Mulpe Avenue 1,000 square foot building moving hazardous waste around my office literally was like it has like the old wooden plywood wood like they're not real wood it's like that plywood stuff oh I mean like wood paneling yeah wood paneling right like you'd see like seven

and stuff, right? Yes. So, you know, that's literally where my office was, and right next door to that was the shitter. So it's always a good morning when you have 23 people using one bathroom. But, you know, I loved it, loved every minute of it. So I got my Haswopper certification, learned to drive a VAC truck if necessary, although rarely. But I was able to, at that point, engage in a business from an operational standpoint, leverage everything that I learned in private equity over the years in terms of investing in process,

technology, people, and started to realize the importance of investing in skilled tradesmen and women. And it wasn't really until I got there did I realize a deficit in the country as it relates to skilled trades. Now, we'll talk a little bit about that in a minute. So built that company. we actually tripled that business in about two years making so much money from that business

that I was able to buy another company called shipyard staffing so that business is skill trade labor to the shipyards so we initial business we eyeball was little we rebranded it to shipyard staffing again true skill trade so I think welders pipe fitters shipfitters shipfitters

great men and women so this company would provide temporary skilled labor to the shipyards as they would build boats. For your listeners out there, like when you build a Navy vessel, there's a lot of peak demand for labor at certain points of the construction. And so what companies like ours would do provide that peak labor to allow them to continue on production and do it in a more efficient manner. So built that, bought that business, built it.

We opened up, we had an office in Norfolk, Newport News, where they built all the aircraft carriers, as you know. We opened up in Jacksonville, Florida, another Navy base. We opened up here in San Diego. The last time I was in San Diego, I signed a lease for a property down the road, so it's been good to me. And then Brimberton, which is near Seattle. That business, again, for me, it really showed me that the deficit of skilled trades men and women in this country is a problem for not only my business, but for the country. So the average age of a well-deadage of a welder for us was like 54. Think about that for one second.

If you think about how this country is going to protect itself and build and repair, just our warships and our aging workforce, what are we going to do in 10 years? It's a real national security issue that no one really talks about. I think we could talk a lot about this, but, you know, the push for college of the last 20, 30 years. If you look at the stats, I think since 1990, college enrollment's up 60%. Cost adjusted for inflation is up like 300%. Subsidized. 100%.

Subsidized by the government. They're making loans, just like the mortgage crash, they're making loans to people that aren't necessarily going to be able to pay those loans back. Because you go to college for four years and it costs $380,000 and the job that you get with your degree when you leave that school. is a $32,000 or $38,000 to your job. That's what's happening. So it's a disaster.

And there's an impending cliff here. And I know you feel strongly about bringing manufacturing back to United States. If we don't start building skilled trades men and women in this country, there will be a colossal collapse. Think about everything we do, like all these great high tech companies and everything they do. Well, someone's got to run the electrician lines there or the gas lines there or build those skyscrapers or whatever it might be. the blue collar skill trade men and women in this country have been forgotten. And, you know, it really came to roost for me as we started building out shipyard staffing because the age really scared me, right?

And so look, our strategy there, pretty simple. So I got secret clearance there. So I threw my company. My idea was to provide skill trade labor to, you know, true U.S. Navy shipyards and nuclear vessels. so I could pay my guys more. We could grow our business and that's what we did. So we grew that business and quadrupled that business and pretty fast, which is great. We opened, as you know, a bunch of new offices.

And like I at the course, I thought, hey, man, I'm building some great value in these portfolio companies. I'm having fun. And then I met a guy that kind of changed the course of my career as we got into groundwork. So a friend of mine calls and says, hey, listen, I'm building a guy. a software company and I like to pitch you on the idea. I mean, you and some other guys. And I went to college with this guy and I say, bro, I'm never going to invest with you. You know, he's one of those guys. A good guy, but never going to put my money behind him. And plus, what do I know about software? I'm a blue collar investor. I like to invest in

companies that actually do things, manufacture things or service things or those types of things. And so I go, because I know I'm. I were friends. So I go to this big fancy, you know, conference room. I walk in and there's a guy sitting next to me and there's a tax account. And I'm like, hey, bro, what are you doing here? He said, what do you mean? I said, you ain't got no money? And he says, yeah, I know he told me to come and fill the seats. He's putting on a show.

I'm like, that's why I'm here. And I whispered to him. I said, well, who's a dude with the money? Are there anyone here? We're just looking at each other? Is he practicing? It's supposed to be some guy named Matt. So he looks across the table and they,

there's a guy there, a guy named Jesse Waltz, and he was the guy, one of the guys that had real money in the room. And so we listened to the pitch, whatever. But the tax guy is also his tax guy. And he says to Jesse, hey, you and Matt need to have dinner tonight, so we have dinner. And Jesse owned a couple companies. One company was a software company, and we're having dinner. And he's telling me about the software business.

It's like a CRM, an ERP combo for this industry that's around. foundation repair, waterproofing, cross-based encapsulation. I like to refer to it as water management and displacement. Consumers don't know what that means, but in the investment world, that's what we call it. And he's talking about this software business, right? And I'm literally thinking, I've got to get out of here. This is ridiculous. And no offense.

Look, Virginia Beach is not the hub for software development. What's so funny, I echo? Yes, I understand completely. So I'm thinking, okay, this can't be a world-class company. But as he continues to talk, he discloses that the aggregate revenue running through his software was over $800 million. I think, oh, not his business, but the businesses that were using his, I said, oh, I mean, I better pay attention. So as I sit there and listen and learn more about the industry, I literally had this crazy idea. So I go home that night and literally get on the Internet and start searching to kind of size the industry.

Because my mind was like, okay, he's doing $800 million. Again, no offense to anyone in Virginia Beach doing software. But I didn't think he could have 50% of the market, 20% of the market. I thought, okay, wow, he probably didn't have 10% of the market. But this industry has kind of been forgotten. And there's no industry association for this specific industry. So mostly you have an association, windows, roofing. You can size the size of the category.

We couldn't do that here. So my idea was simply this. Look, I pitched them and I put the proposal together to that. night and I remember my wife Sarah's like you're just a crazy man so I put his proposal together jock and it was simply this I'll buy your software business I'm sorry I'll buy your service business he owned a service business as well called JES I'll buy that service business you can capitalize your software business with the proceeds of the service business that I was going to buy so he invented the software business to support his foundation business and I said look I ain't going to buy that

software business, but I'll buy the service business. You do your own thing, knock yourself out. So like at 4.30 in the morning, I'm about to send this thing. Of course, Sarah says, hey, you idiot, don't do that. She says that a lot. So I wait to like 730 truthfully, send this thing out and the rest is history. I mean, so Jesse, we agreed to terms like three or four months after that. And I bought this company called JES Foundation Repair in Virginia Beach. And they had, at that time, they had three offices, one in Manassas, which is effectively Washington, D.C., one in Richmond, one in Virginia Beach, and he had owned another business that candidly I think he bought right before I bought him to get some ARB on the trade in Indiana called Indiana Foundation.

So we started with these four locations, and aggregate revenue, roughly $30 million, about 190 employees. In my mind, what I wanted to do was build a National Foundation Services, business with this platform because I had seen there was no national player because there's no association I couldn't find a national player and I really cut my teeth on these other businesses and kind of really felt like I was in a position to bring the leadership capital process technology to an industry that time had forgotten and you mentioned it on the outset we are really in the construction business but we don't talk that way we talk consumer so day one we are a consumer

business. We don't talk construction. We are certainly construction company. That's what we do. But we go to market as a consumer business. And the way, frankly, the consumer has evolved over the last 10 years. If you don't go to business like that, you're going to lose. And we win a lot of the business because think about your experience with contractors today. It's typically horrible. You know, they say they show up. They don't show up. They say, you know, they're going to send you a bill. They don't. So it's not a great process for consumers. our notion was simply we're going to build a company that puts a consumer first that builds a national business but at the same time build a unique skilled trades business that honors a men and women of this industry

well they can have a profession and not a job and I learned that mindset through Petrochem and shipyard staffing and it's become kind of a not kind of it has become an obsession of mind to build businesses where we celebrate men and women that get it done, not just with their mind, but with their hands, because without them, this country falls apart. So that was how Groundworks was born. And so that was in May of 2016. We bought this first company.

And, you know, I think when I met you, I, of course, you might forget this. But so I, of course, read extreme ownership early on. And probably late 16. I think the book came out in 15, but late 16, I read the book. And it really resonated with me, especially as it related to groundworks in the sense that, think about what we do. So we are decentralized business. Our crews are three-man crews.

If we can get them trained on the laws of combat as you define them. you know, and as we live them, you can empower a business to do remarkable things, right? And so we adopted this mindset of extreme ownership within the company. And I never forget. So early on, it was pretty, I had some struggles. So I bought a company that had to fix up a little bit, to be fair. And so I went to the muster in D.C., Muster of 3. What year was that?

I think it was 18. Okay. and so I didn't share this but look every penny I had went in this company I literally moved back in but mom to buy this company with a wife and a child so yeah so that was a lean Christmas

so you went back to the Christmas and that's why your wife was like don't send that freaking email jackass that's our money that's right So to make a run at this, we put everything in it. And, you know, I hear you talk quite a bit, but to be successful in anything, there has to be a degree of obsession.

There's no plan B for us here. It is, this is it. There's, we're all in on this. And it has to work. And it will work because I'll put everything we have into making it work. And so we're cleaning up a few things that we needed to. We spent probably over a million dollars of going back and doing jobs for consumers to do them correctly. And so the price tag for the musters, it's real. And so I was going to bring some of my

leaders. And I have a partner. So this fellow, Jesse Waltz, invested back into the business with me. And he's a minority shareholder at the time. And, you know, I was like, I can't run this through the company because, you know, he's not really happy with me at the moment anyway. Even though there was a minority guy, I wanted to keep him happy and respect him. So I tell the wife, hey, guess what? is it okay if I spend X amount of dollars to go this muster? I'm going to bring these guys. And you can imagine the look. You're like, what are you doing, right?

So go to the muster. I bring eight guys. One guy is one of my best friends, a guy named Tom Gerardi, who doesn't work for me, but is a huge fan of yours. And he was like, you've got to go to these musters. I'm like, bro, have you ever been to a muster? He said, no. And by the way, he played football at Harvard.

So he's a bond trader. He ain't worried about living with Mama. But he's like, Malone. I'll pay my own way. I said, yeah, you should pay my way. So we go to the muster. And candidly, and I say this internally with my guy. So I was like, man, this is going to either be like some Tony Robbins bullshit.

We're going to hug it out and sing kumbaya and I'd be a waste of money, or it's going to be the real deal. And it was the real deal. It was literally the real deal. And I said, I got to get me some of this. I got to figure out a way to weave the mindset and the cadence of what we talked about and all the laws into our business to empower. this business to be as special as I want it to be.

If you're going to make investments in people and you're going to build a business where the profession is honored, you have to give them the tools in order to do it. You just can't, you know, for example, we can teach sales, we can teach production, but how do you teach leadership? How do you really teach it? And how do you measure its effect? And what's the return on investment on that? and that was look the way you did it and Lave did it the SEAL teams and how you wrote about it

I said well there's no one on the planet that can do I mean if he can't do it for us they can't be done right so I'm driving back from D.C. and I'm all jacked up and I call I don't know about that back in the day your headquarters were in Seattle yeah so we call out to Seattle and and I get a young guy on the phone and he's like, listen, we don't really do long-term programs. If we're effective at what we do, we don't really need to be there. Because I pitched him on, hey, look, I want a multi-year deal so that I can send new leaders through this program constantly so that I can transform my business so that we have a bunch of savages walking around that care about the customer, care about themselves, and are passionate about leadership and development.

And so he said no initially. And then so we called back, say, look, I don't think I've ever. explained myself right where here's kind of what we're looking for and uh yeah that interesting little backstory on that that sort of is the you know failure on my part because one of the things that I would tell the team at Eschlon Front is I'd say listen I don't want to be like these consulting companies that go in and hang on put their hooks in and claws in and they they're just going to milk company for everything that they're worth listen guys if we're doing our job correctly we're not there for five years we're there for six months we're there for a

year they understand these principles and they take them and run with them What I didn't clarify is, hey, if we've got a company that's growing rapidly, we may need to help them along the way. And that happened with other companies, and your company was one of the ones that had happened to it was happening to very fast. And so I had to kind of, I mean, I forget how it got back to me, but I remember rebiefing the team and saying, listen, if we have a client that's growing rapidly, we can train all their trainers, but they're still going to need people. They're just going to need support. I mean, when you're absorbing two or three companies a year that have two or three hundred people each, they're probably going to need help. Yeah. We need to help them.

So there's a little backstory there. Well, they certainly echoed your first sentiments right away. They said, no, no. And it makes sense. But we had to really explain, look, it's not the same people going through the program. And, you know, Kaine, at that time, we didn't have the bandwidth to have true trainers. We were saying, okay, we're going to hire the firm. We're going to send new leaders, new leaders through the process.

And look, our growth rate, we are acquiring businesses. And we wanted to make sure that those businesses, they keep their culture. We celebrate that culture. You know, our average brand at Groundworks is over 26 years old. Other companies we buy. We buy businesses as small as $3 million as large as 80. So they're big dichotomy in terms of the size of the businesses. And when we buy them, we would celebrate their culture, but we're going to bring them on

to the Groundworks way of culture. culture, which you can marry those two. 100%. And the way we married them was by leveraging extreme ownership as our culture. And so it empowers a given culture if they embrace these things. And they do. And so every acquisition now we run an FTX for the partners that we just brought on. I think we've run 16 of those now.

All kind of senior level leadership go to musters. You know, we're going to send, you know, 23 folks to Dallas. It's part of our leadership development training program at Groundworks. And, you know, we have, I think the last number, we've spent, we've sent 530 folks through training directly with the Ashland Front Team, you know, JP Donnell, Carlos, Corey, Cody, rather. And then this young guy, Flynn Cochran back in the day, you know, they were. would lead that process for us. And really, again, not to sound like a commercial, what they became part of the team. Like, JP knows my team and he can relate the stories of our business and the construction component of our business in a way that ties it into extreme ownership,

and how it applies to our business every day. And that is how you really learn. And that's how it's absorbed. And so your team's done a really good job at that for us. Yeah, the, the, You know, when you talk about merging, hey, this idea, this, these principles into some other company. And sometimes I'll, people will, I'll have discussions with leaders about that. And, you know, I don't know if it's going to, I don't know if, you know, our culture is going to match. And I always say, I have like a, I've answered this question so many times that I kind of just go, oh, you don't think the culture is going to match. You, you maybe think you have some different leadership principles that you feel, yeah, you know, we're just, we're not in the military. We weren't in the military.

So we're just, you know, we don't have that mindset. And I said, well, you know, let's talk about it a little bit. You know, for instance, we teach cover move, which is teamwork, which is supporting team. Are you teaching that you should all stay in silos and work against each other? We teach about keeping things simple. Are you teaching that we should make things so complex that no one knows what's going on? We talk about prioritizing execute. Do you think that in your company, what you'd rather do is spread yourself so thin over so many different things at the same time that you can't effectively do anything? Is that what you're thinking? And, decentralized command, are you thinking that you don't want to empower your subordinate leaders? You want all decisions to be run through some central location and even the idea of extreme ownership. Are what you thinking is this doesn't match with your culture because your culture is we're going to all sit around and blame each other and point fingers of each other. So like there's no leadership human in the world that disagrees with these principles. You just can't.

They're universal principles that are foundational. to leading other human beings. So the fact that you recognize that, that you saw, oh, I see this. And then the step that you're talking about that JP and the rest of the team, that JP does well, but he's been working with you for a long time. We do this all the time. We do it with finance companies. We do it with manufacturing companies.

Like the principles apply to any organization. The thing that's nice is that you were able to sit there at that muster and go, oh, I see the alignment between, oh, decentralized command. Well, let's see. I got a bunch of disaggregated people. I got small elements that are going out in the field. They've got to understand how they're going to interact with the customer. That's how we're going to get good feedback.

That's how we're going to grow our business. Oh, okay, that makes sense. Oh, what about prioritizing execute? Oh, yeah. Well, we've got all these things that are going to go wrong on a job site. If we don't have people that understand, if we don't have people that understand how to react to those things and how to figure out what the most important thing is and execute on that. And you just were able to see that.

and therefore taking to go, hey, we need to run with that. And that's an impressive call to make. Oh, thank you. Look, in retrospect, it looks like genius, right? But candidly at the time, it was back to that simple equation. How do you build leaders? I truly believe that, and you've said this, a thousand times or more, that you can teach leadership.

You can teach it, and you should teach it, and you should learn to be a student of leadership, right? And so, look, you've got so many war heroes on this podcast. I'm the opposite of that. I'm just a normal knuckle-dragger, you know, entrepreneur. But you don't have to be in the military to embrace these principles. If you lead anything in your life, these principles apply. And, again, just a walking example of that.

And my company is as well. And so what you've seen at Groundworks is the belief that if you unite people on a mission, and you empower them and train them and believe in them, you can do the impossible. Part of the notion of groundworks, and we've taken extreme ownership a little deeper than just the laws of combat, at our company, we have over 235 owners. So think about the decentralized business, right?

So today, business, again, north of 800 million, we have 49 locations. at each one of those locations as a general manager, a sales manager, production manager, an office manager. My managerial philosophy, before even reading the book, is pretty simple. I want to hire the best possible person I could possibly hire and afford. That does change over time. But you want to do that.

You want to give them the best equipment you can afford to as a business. Training, equipment, whatever it might need. You want to build incentive programs that allow them as an individual to win when the company wins. And then you want to hold them accountable. So if you believe in that concept, again, that's pretty simple management philosophy. If you believe in that concept and you're super layer in the principle of extreme ownership, and then you say one step further, all you leaders in the branches, you're going to be literally

owners of our business. So I don't want you just to adopt extreme ownership live that way. If you do that and you really believe it, and we as a company, when you and your family will get the benefit of that by ownership. And so look at Groundworks, we're going to make over 100 millionaires out of this company for men and women that work with their hands. Think about how many companies out there in the Valley and software company and startups. You have all these young, and they've earned it, but all these young overnight millionaires

walking around. I always felt like you can bring that same mindset to a skilled trades business. you could and we're going to prove that it can be done and by doing that I'm going to attract world-class talent to this business if you're at another home services company today

if you're at a window company or I won't say any company names but if you're at any company and you want to get after it and I don't mean just believe in the philosophy of this and also what we are building as a company but if you care about working with people that care

and you want to build something unique and get rewarded for that as a business and as an individual to help your family were the only business that I think in home services adopted that mindset. And that's why we're winning. Groundwork success has nothing to do with Matt Malone.

It has to do with the 4,200 people that make it up. The only thing I did was kind of push and nudge, shut the strategy, and adopt all these different strategies, not just EO strategy, but how we incent. We have profit sharing programs, for example. We have good benefits. You know, we have a career path where men and women can join here and have a profession. The many of the companies that I buy, man, it is a job.

Here's why. You buy a family-owned business, and Mr. Smith is at the top, and Mr. Smith's kids at the business, and say it's a $10 million business. You're the third man down. How are you going to get any more money? How are you going to grow? Well, in that kind of environment, you're not going to grow. So family-owned business is great.

We love them. But in our business, I want someone on our staff. to take my job. They should. That's what we're built to do, is that if we build an environment, respects the men and women that get up every day and work with their hands,

go in the mud, like we have office in North Dakota and Fargo. These dudes are out there in 10 degrees. We got offices in Miami. It's 110 degrees out there some days. These guys get out there, protect consumers' greatest at their asset, their home. It's not sexy.

It's hard work. But at our company, we can make a profession and a livelihood that recruits the best possible talent in the world in home services to do something's never been done. And it's a big dream, but it's not me. It's my team. The team is building it.

And that's what's great about not only our company, but this country is that you can do that. You can do that here still. And you're an entrepreneur. You know what I'm talking about. So EO has been a big, big part of our internal mindset and culture and still is. Like we have meetings. They're called Cover and Move. So when sales and production get together every week to talk about their week and the jobs that we have to do, it's literally the cover and move meeting.

Debrief and readback, those are phrases we use every day. Standard protocols for you guys. But having worked in other businesses and owning other businesses, the power of just a readback, it's hard to explain. I even use it with my wife, which she hates. I said, let me give reback on that. Here's what I heard. Or your kids. Logan, I said, okay, we just discussed this.

Tell me what daddy just said. So, you know, you live it. But to, you know, look, to some of your listeners out there that are in the service are thinking about getting out of the service one day, to all the business guys out there, all the entrepreneurs, look, it's real. It's real. If you adopt it and live it, it's real. And I have this phrase that I use all the time internally.

it's a you get the life you give yourself like there are externalities that have happened in your life and sometimes you can't affect them you can't do anything about them but at the end of the day if you decide to get up you have the discipline to get up and get after it every day and you make it a priority you can change the course of your life and all we're doing as at groundworks is using that mindset on a business that changes 4200 lives sounds cool now but when when you know those slim Christmases when you know when when when I'm begging my wife to to allow us to send you know eight dudes to a muster in D.C. It wasn't that way. The the the the investment that you make right so this is this is the thing that's very interesting you are investing in your leaders and

you've been investing your leaders you know what when I got back from my last deployment when I was in Ramadi came back and took over the West Coast training and I was just so focused, Charles focused on the shooters, focused on making sure that the young guys understood that as seals, they needed to be thinking shooters, absolutely. But I really, really was focused on the leadership and making sure that the leaders understood how to lead. And it was one of the things that really opened my eyes is on that deployment. And really on my previous deployments through my whole career, the Army and the Marine

Corps had absolutely professionalized and doctrinalized how they trained. leaders. So the the army would go to this the the company career course their career course they call it which is a company level commander and this is like a six month or a year long school that these guys would get trained on how to lead their troops and they have that at every level enlisted and officer in the army and in the Marine Corps and in the seal teams there was almost nothing there was almost nothing there was a little junior training course that was Laif ended up taking it over when he took it over it was hey this is where you're going to learn how to write evaluations this is going to you're going to learn a little bit

about writing Navy Navy message traffic it was and you'd get some debriefs on stuff but you weren't going to actually learn any principles of leadership and it was just it was unbelievable that this was taking place and I remember as I started to try and push this hard the I I started going up my chain of command. And one of the things that I'd bring up the chain of command was, was Hamburger University. And Hamburger University, if you don't know, it's up in, I think it's in Schaumburg, Illinois.

But if you're going to run a McDonald's, you've got to go to this course. And it's like a six-month school that you go to. And so I remember sitting down with my boss and saying, hey, have you heard of a hamburger universities? And what's that? I said, it's if you're going to run a freaking McDonald's, You're going to go to a six-month training course on how to lead a McDonald's where you flip burgers and And fry French fries and we've got guys that have are going to go out and and oversee

Combat operations and have lives at risk and we give them they don't go to any school This is a problem and and and part of the problem is because We're a victim of our own success. So hey, you know, hey Jocco you just went on deployment. You came back. You did a good job. You were in charge. Okay, so what we're doing is working and And hey, this other guy, you know, Laefa, you did good. You got mentored and you got trained up. So that what we're doing, the on-the-job training works. And it does work sometimes. But it also fails sometimes.

And this is, so now we find this in every industry. Every industry, hey, oh, we got, we got echo Charles here. He's a good salesman. In fact, he's our best salesman. Let's put him in charge of sales. What does he know about leadership? He knows how to sell stuff. He doesn't know anything about leading.

Oh, we got Echo Charles here. He's our best mechanic. Okay, great. What are we going to do? Let's put him in charge of all the mechanics. He's good at turning a wrench. He's not good at leadership. And we just throw him in there.

And for some reason, people think that leadership is something you're just born with or that you know how to do intuitively. And it's just factually not true. So what we encourage and what you're actually doing is, oh, Echo, you're the best mechanic. We're going to take you and we're going to elevate you into a leadership position and we're going to train you how to lead just like at one point we trained you on how to turn wrenches and repair this carburetor. We're going to we're going to train you the same way and you've put a massive amount of investment into your leadership and One of the earlier questions you know when we started Eschlam front you know I get asked well how are we going to How are we going to know if this works? What are the metrics to know if this succeeds and I still to this did

I just had this conversation the other day. Whatever metric you're running at your company that means you are successful, so whether you're trying to cut the cost to produce or you're trying to improve your time to produce or you're trying to grow or whatever metric you're looking at, if we do our job training your leaders, that metric, all those metrics that you're trying to improve on, they are all going to improve. That's what's going to happen. And that's where you say, hey, look, we actually have, we do some of these like, you know,

soft skill surveys now. And you know, what do you think your leadership? And that's good too. That's good feedback. It's good feedback to say, hey, the leadership is now has a better relationship with the troops. That's great. The troops think the leadership is more in tune with what they're thinking and what they're saying. Those are great things to do as well.

But for me, where the money, where the rubber meets the road is, hey, we're trying to produce this widget in this amount of time and now we're doing it. We're cutting our costs. We're getting it out. Our salespeople are doing better. That's how we measure leadership success. It's what is the success of the company. So as you invest, you get that ROI and that's what I you know, that's what I love about seeing the success of your company and and some of the other companies that we work with that we get to see this this incredible growth and you know, I started this whole thing off saying leadership is the most important thing on the battlefield in business and life and to look at a company like yours where you are proving how that works and how important it is and how you can grow things and how you can have 4,200 employees.

And I'd love to, you know, if you are fishing for a compliment, say, no, but Matt, it all starts with you. Hey, it does. I'll give you a compliment. It does start with you. But let's face it, you've got employees that haven't seen you in three months. You've got, you've got someone right now making a decision in a basement. 100% on, on something that's happening.

And that individual is making the right decision as a leader. On the front lines, he's empowered to do that. And you couldn't see that if your life depended on it. You couldn't help that person make that decision, except for the fact that you already have helped them. Because you trained him as a leader. They understand the culture. They understand the mission of the company.

And when you do that, it allows you to drive a company forward with people at every level leading, making the right decisions and moving in the same direction strategically. It's the only way to scale. Right. So you just gave that great example. We have forming right now, this is a forming right now probably anywhere in the country, right? So say he's in Kansas City. And the footer's not where he needs to be and he's laying down what he needs to lay down.

He's thinking, wow, shit, what I got to do here? He's been empowered. He knows that the number one objective, take care of the customer. If it costs a few dollars more, no factor. If it costs a couple hundred dollars more, no factor. If it costs like a thousand dollars, I'm a prior to call my soup to make sure it's cool. but that soup's going to know no factor. Go, serve the customer, okay?

But that mindset is part of our culture, and that comes from the investment that you make in a business. We see it all the time when we buy businesses. You know, this old, and I call it lazy. The notion of on-the-job training is lazy. It's lazy. If you say to yourself, I want to be world-class, I want to be good. You don't stick just a guy with a guy and say,

learn from Jocko because he's really good at this. That's lazy. Small businesses do that that don't want to grow. If you want to take an institutional approach to changing an industry and being the best possible business you can possibly be, it has to be part of who you are. And that takes time, investment, and energy. And our KPI is at Groundworks. They've exploded over the last four years, five years. A lot of factors. One key factor, one key factor is investing in leadership training. You can't be a leader in our company unless you go through it. Every employee gets a book. I mean, you can't get away from it. Now, do they read it? I don't know. But you can't be a leader and a manager. I'm sorry, you can't be a manager. You can be a leader without being a manager.

You can't be a manager at Groundworks without going through a course. And that's just who we are. Now, as you know, human beings are human beings and some people take it better than others. But on average. I think our culture is such that if you don't live that way, you're kind of weeded out because there's a complete alignment on what we are doing as a business. Not just our mission of building a great world-class home services company, but there's a culture internally of we're going to do it the right way. We're going to care about the men and women that work here. We call it walking in the light and living with the servant's heart. And yes, we serve the customer. But my leaders, we serve each other. And if they're not.

The overall goal is to build a great business where we all win and we're literally making millionaires out of men and women that never have gone to college. We are serving one another. Yeah. And that's the powerful thing. I've got to share this one pit with you. So fast forward, I'm running out of money. So this was in 19.

Sarah and I, you know, we put everything we had in this business. I sold, I should show you. So I sold Petrochem, that company I first started with, to put it back into groundwork. So I sold it to a big-time private equity firm out in San Francisco. Huge return for me and the misses. I can't say it publicly, but it's way north of five times, over 20. Shipyard staffing. I have a great partner that, his name is Jack Anthony, that I partnered up with to run that business for me.

He absolutely crushed it for us. sold that to of all funds, the Founders Fund, the most legitimate VC firm in the world probably, Peter Thiel and his team and all the great investments. Some knuckle-drager from Ocean View sold his company to Peter Thiel, the guy that, you know, SpaceX and PayPal, all those things, right? He started a company called Workrise. They are in the oil and gas industry. They bought our little platform to enter the Marine industry and defense industry.

Like, it's surreal. Only in America, right? So we took every penny that we had from those things, pot to right back on the groundworks, but still wasn't enough. So in 19, you know, we decided, now I had outside investors. I had some friends and family,

you know, like folks that I've seen and been friends with, no institutional, no big money guys. We wanted to continue this mission, and I had worked for four or five years developing relationships of companies to buy, some big ones. And so I finally had to buy. the bullet and bring on a financial partner.

So we are fortunate enough. I have a really good friend that is a great investment banker, John Nooner, for home services. And I literally saw him on a sunrise service on Easter. You love this. So he doesn't live in VB, but I have this little guy, Logan, and, you know, we can't take him to church on Easter Sunday because he's a madman. He'll be a front around. So Sarah's like, hey, let's go to the sunrise service.

He'll just run off and serve or whatever he does. we're still going to be able to go to church, right? So he's running around and we're at this sunrise service. And I look behind me, there's this guy John Nooner, who I hadn't seen since college, by the way. I was his R.A. One of the other jobs I had in college, I was an R.A. That's terrible. Don't judge. It's a not good gig. But there, there's this guy John Nuneer. He said, hey, Malone, I've been following your company. So this was in, this was April of 19. And I say this is great timing because we need a, we need a financial partner. So we talked to 13 private equity from some of the greatest brands in the world.

13 offers, which again, that's surreal, right? You build a company and you know the names of all these firms, right? So it's kind of like, whoa, it's pretty exciting. We took it down to three and ultimately picked one. We picked a group called Cortec out of New York. They have a guy that is our chairman, a guy named David Schnottig, who is legitimate savage. He's more aggressive than me. But they had great experience with Yeti.

So they built Yeti. They were the private equity firm behind Yeti. And they took that thing from whatever, 40 million to a billion and it's public now. But they're really good at marketing. And I wanted to transform my business into a consumer marketing company. Yes, we do construction. Yes, I have the horsepower behind the scenes are men and women that do it with their hands. But how we went in the marketplace with consumers is being differentiated.

So that when, like it's the Amazon approach, when I'm coming to your house, you say you're going to get a text. It's going to show where my car is. It's going to say, hey, this guy's going to show up. Here's what he looks like. So we want to leverage technology and really leverage how we attack the consumer side of our business. And I thought they were good at that. And so we partnered up with them. And then, you know, COVID hit, right?

So imagine big investment, COVID. Everyone is scared at this time, right? Thankfully at Groundworks, we were, we were an essential business, which I love. So we have these shirts that we gave out called the essentials. But I remember how to get lawyers to give letters to every. driver so as we went down the road if they got stopped they could put out this letter and say look we're essential

so we went to work and you know some parts of the country took COVID are a lot different I'll tell you this my guys was there COVID like we just got after it now the only thing we did cancel was a kickoff of course which you put your part of that but we just got after it and which even crazier said this this

group Cortec I had lined up four or five big deals big companies to buy. And, you know, what we haven't talked about is to the founders that I bought these companies, I call them the founders, made up some of the best men and women in the country. We've been very lucky. Our strategy is we buy the best brand in a given state. We expand from there opening new offices. And as you look at the map today, you know, we're getting there. We're kind of really southeast, Midwest, mid-Atlantic. We're not West Coast. We're not Texas yet. We're not Pacific Northeast or New England.

But we're a multi-billion dollar business just in our current footprint. Well, I buy these businesses from these founders who were guys that started with nothing. They built these businesses. And we give them good money for their business. This is great money. Many of them, most of them, reinvest a little bit into groundwork. So they're my partners. And they give me counts on things like that.

So as we're building these businesses and buying these businesses, I needed to buy a few of these big ones. And I didn't see Cortec for many. Many, many months. I think I've seen them five times since they've invested. And they've given us a lot of money. So we started on a buying binge. And I bought four of the best brands in the country. We do all our M&A in-house.

So I do all the M&A with my team. Cortec allowed us to do that. They were exactly as I thought they would be. Part of the reason I picked them going back to what we were talking about, the importance of investing in the ROI and leadership development and training, they completely bought off on that. It was most PE firms. Some PE firms, they're looking for every penny to go to the bottom line.

Never ever once have they said, don't do that or why are you doing that? Because it's part of who we are in the magic sauce. Look, we've gone from 30 to 800. We'll cross a billion this year. You don't do that without investing in your people. And you can't do all-the-job training when you grow that fast. So when I say it's lazy, it's lazy in the sense that a small business can do that. Because Echo and I can go and he'll teach me how to swing that wrench,

and hopefully I'll be a good mechanic at some point. But you can't do that when you go from 190 people to 4200 and, you know, 360,000 in payroll. That was that was payroll when you first bought the company. I knew my wife and I could cover that maybe for a month or two if we had to. It's like 20 plus now. So it's all surreal for me. So the importance of investing and not doing on the job, the ROI for us has been, I don't know if you could calculate it candidly, because it's built into everything we do at the company. So it's not like one specific thing that makes this company great.

It's thrown into the mindset, the culture. It's thrown into everything that we try to do. And it's a big piece of it, as you know. I mean, but it's thrown into that. So I've never been asked from my board. And I got some legit guys on my board that have run public companies, some of the biggest home services companies. They've never said, hey, what's this line item here, leadership development?

They've never said it because they know it's who we are because I gave them a book the first time I met him. I think it was Project Jocko actually. But anyway. When you were talking about how the culture gets into the system, and it becomes part of who you are. I was thinking, so I was going to officer candidate school. And when you're at officer candidate school, when you first show up there, it's, you know,

it's a total indoctrination boot camp style indoctrination. And you, one of the rules, they have all these weird rules. One of the rules is that you can't look at your food. So you sit down to eat and you can't look at your food. You can only look straight ahead. And remember, I was an enlisted guy for my first eight years. and I'm kind of street smart. So I'm sitting down and I got to eat.

And I think it was like chicken breast, right? So how are you going to eat a chicken breast without looking at? Like, how is that even going to work, right? But also, I'm thinking, how are they possibly going to see if I glance down at my food, right? So, and really the people, there's drill instructors. So there's Marine Corps drill instructors there. But there's also the senior officer candidates are there. So everyone's watching you when you get into the chow hall for the first couple, well, they're there all the time.

But the first couple of meals is where this happened to me. So I'm sitting there. I sit down, you know, and people are yelling and screaming. You know, don't look at your food. Look straight ahead. They call it squaring your meals. Also, you have to lift your food has to go up straight, you know, 90 degrees up from the ground or from the plate. You have to bring it up straight. And then, you know, 90 degree turn into your mouth. That's how you got to eat. They call it squaring your meals. You have to look straight ahead. So as I'm sitting there, I'm thinking they're never going to be able to tell that I'm looking at my foods. I'm just going to glance down and get it, you know, see what part of the chest. chicken breast I'm about to eat. So I kind of glanced down there. And as soon a millisecond after I look down, they're like, oh, what's all you're doing? And they get it. And I was thinking to myself, how did they see that? So fast forward 10 weeks or 11 weeks.

Now I'm one of the senior people. And I'm standing at the end of the table. And everyone is staring straight ahead. And when one person glances down for a half a second, it's so blatantly obvious. It stands out so much. even though you wouldn't think they could see you, it stands out blatantly obvious. And that's what I think happens inside these companies

that we work with where you get this attitude of ownership. And when it starts to sink in, anybody on the team that's like, well, you know, this actually isn't my fault. It is like so obvious to everyone. And eventually it becomes obvious to yourself. Eventually, as you're about to say, well, you know, this isn't really my fault.

This is, and you can't even get those words, out of your mouth instead you say you know what what can I do to fix this problem and it's it's a beautiful thing to see it's a beautiful thing to see and when you get that when you get that whole attitude that culture in so deep man it's really becomes unstoppable it really does because everyone on the team now becomes they're looking to solve problems they're not looking to blame they're looking to solve problems you combine that with decentralized command there have the authority to solve problems they know they can fix that problem for a hundred

And you know what's even also, you know, we're talking about that example. You got some as part of the foundation's a little bit messed up. The attitude, he fixed that problem. That problem is probably not happening. Because going into that moment when they were about to set that fixture, that guy says, hey, you know what? If this isn't good, I know I'm going to have to fix it. And I know if it's not good and it's going to cost money to fix it, I'm going to have to call my supervisor and say, hey, I mess this up. and you know we're gonna have to eat this one.

So you get that preemptive ownership where people care more about the job. They wanna do it correctly the first time because they are taking ownership. You know, that's the one of the bad things about extreme ownership is the first book's all about, oh, extreme ownership is in the past. It's a mistake that happened and oh, it's my fault, which is good.

But what's even better than that? I'm not even gonna let that mistake happen. And that's what, when you have it infused, like you have it at your company, people are allowing, those things to happen. And that's a powerful thing. And then you reinforce that behavior by when they do make the decision,

or there is a mistake. You say, no problem. Yep. I'd rather make that mistake and not get on the guy for over-correcting than under-correcting. And that feeds on itself too. Like if they know, okay, look, I was empowered to make this decision, and I might have gone overkill. And maybe I lay down more track than I needed to.

Or maybe this is, oh, but it's perfect. It's a perfect job. You say, okay, you probably overbuilt that behavior. Bro, good on you. You took care of the customer. We call it protecting the patch. You got to protect the brand, right? So, you know, a little bit, you know, you've glanced on this couple times.

We've been on for a little bit. But I just wanted, before we kind of close out, you know, one thing you mentioned a couple times was, you know, that the fact that we got an average age of welders at your company, your prior company, was 54 years old. As you know, I'm also in the business of people working with their hands. We've got people that are manufacturing things in America that haven't been manufactured in a long time here Passing on we were lucky enough to grab some of that knowledge you know Pete was lucky enough to grab some of that knowledge From some of these people that were older than 54 years old, you know that were 65

We've lost some of those those mentors at origin that were passing on firsthand knowledge of how to do this stuff Is there something that we could do better as a country? to help steer people in the right direction. I know I just worked with a university up in Indiana called Ivy Tech, and they teach trades. That's what they're doing. And, you know, I had an interesting conversation with them. It's like the highest paying job that you can get out of Ivy Tech is an elevator repairman.

Elevator repairman. And they make like 80 grand coming out of that school. You make 80 grand a year. and you got a you got a job, a career, a life. How are we failing to educate the young people in America that they don't necessarily have to go to college? They don't necessarily have to get a degree and they don't necessarily have to look for some kind of a job,

some kind of a white collar job that if you go and you get a trade and you learn how to do something, and I always say this, the SEAL teams, on the enlisted side, this is as blue collar as it gets. I mean, that's what you're doing. You're working a machine gun. You're building demolition charges. It is, and you're a moving company.

We always joked about the fact we're always moving stuff. But where are we making that mistake? How can we do better in America? Well, I think it starts with the perception of these jobs, right? So if you think about at home, right, the parents think now, hey, I don't want you to be a I want you to go to college. Well, if you look at the data, you say, okay, look at, you got a, was it, 1.6 trillion of college debt and you have no, and I don't want to offend anybody, but this will.

You're getting, you know, degrees in like art history. Right. Now, no offense to art history, but how many historians of art do you think there are in the world that actually operate as art historians? Seven? There can't be many, right? I mean, I don't know, but they're not the, they're, they're, they're, they're, they're They're not thousands of these jobs, and what do they pay?

So there's this perception, hey, you go to college, it's your ticket. Well, the data would actually show if you do a skilled trade, at least my experience, so we have plumbing division as well. Look, you have plumbers that easily make 80, 90, six figures. I know welders that worked for us at shipyard staffing. If you're not making six figures, you're not any good. At Groundworks, you know, a good foreman, a good foreman, it's 90 to 120,000. a year. Now, you've got to work for it. But think about the perception of a kid in high school

saying, hey, look, I'm going to go do be electrician. Now, that's a skill that will, they can go anywhere and do anything. And I would argue economically in today's world, their value is only increasing because there's fewer and fewer. Scarcity does cause, it does drive value. So it's a con, I believe it's this, we've been shoved this idea for the last 20, 25 years that you have to go to college you'd be successful. That has to change. How does that change? It's, it's candidly parents. I always believe it starts at home. The perception of, hey, my Johnny and Sally, whatever, and they need to go to college to be successful. Not for everyone. I'll tell you just a quick story at Groundworks. I have a, and you know, Flint Cochran joined our company used to be with EF, you know,

Harvard Business School McKenzie. He's a divisional vice president of our East Coast division, our Eastern Division. He has a counterport out west. His name is Jeffrey Martin. Jeffrey Martin went to Moverly High School. That's where he went. So this notion of meritocracy is alive and well at groundworks, and that's just a perfect example of it.

If we celebrate the men and the men and women that work with their hands and not demean them, we'll get more of them. And then I think, look, there has to be some kind of mindset that says, look, we as a country need to unite around developing more skilled trades and pushing it back down. to the high school. I don't know if you know, but I don't know any high schools that really have that kind of craft anymore. And it's not for everybody. Look, going to college is not for everybody, but there are things we need to do as a country. And I know you know this better than me.

You know, men and women that lead this country from a legislative standpoint need to figure out a way to push this agenda because if they don't, national security, national security, in my view, will be at risk. I only know that from shipyard staffing. And, if you can't repair these boats and you can't build them and I don't even that's not even including planes and tanks and everything else steel has to be welded and our history degree is not going to get you there so how we solve this as a country look again my view has to start at home parents need to think okay there's still a great livelihood for my my son or daughter

by being a skilled tradesman and we have to as a society celebrate it like part of the thing at ground works is we're celebrating and profession. We honor you because you work with your hands. You're not beneath me. Now, most of these our history majors, they end up slinging you coffee at Starbucks, right? So, you know, you look at them and you say, okay, there's 200 grand down the toilet that you and I will have to pay for. Conversely, to all the parents out there, if you have kids, they can go to a trade school. They come out, not in debt, but making money. And they, you know, they have a nice six-figure job ultimately make a ton of money. So it's, it has to start.

at home, but I think legislatively we need to do better at celebrating the skilled trades and put a concerted effort on building it just like you would build a military. It's really what we're building. And then, like you mentioned, I'm in the manufacturing business as well doing it here in America. Beautiful. You guys are, are you, how much are you able to keep your manufacturing in America? It's all in America. So I didn't mention this, but we're vertically integrated as you.

You know, we have our own software business, but we make our own steel products as well. So I get too technical because you fall asleep. But, you know, when we secure foundations, we get to the footer and we put brackets on and we drive steel to support the foundations of a home. Well, all that steel, we've patented our own products and we actually make it in 120,000 square foot facility in Rosewood, South Carolina. You know, we have lasers and machines and, you know, 40 guys out there getting after it. So that's not imported steel. We do it right here in America. You know, all our pumps and dews also made here in America.

It's our little part to serve the country is if you can do it, you should do it. And again, we're not big manufacturers like you guys. But if you're going to serve the country in any little way, you need to serve the country. And part of the way of serving the country is making it here in America. I think we saw with pandemic and what's going on in China and the rest of the world, Hey man, it'd be nice to have a supply chain from some South Carolina versus from India that's sitting off the coast here right now in a boat. I've always, I'm a very lucky person in a lot of different ways, but certainly the luck, the luck of being kind of obsessed with building stuff in America and having that supply chain up. And, you know, Pete and the rest of the team at origin, you know, we, we, we, we.

When COVID hit, we were kind of looking around, look, we were, it was horrible. You know, people are losing their jobs. It was horrible. But we were kind of looking around, like nodding our head going, we were on the right path. And we're not worried about. We're not, we don't have, we don't have containers sitting off the coast of wherever waiting to, waiting to get here. We have our supply chain. It's an American supply chain.

And then like you said, we're employing Americans. And we got people that are, are building this country and, and, and take, you. these skills you know had a conversation with someone was talking about you know people people not being fit for the military right you're sure you've seen articles like that you know they say that the kids are spending so much time on video games or whatever that they don't won't even be fit to join the military you know and I kind of said well who's gonna fight the wars if a war comes well this is a very similar thing right who's gonna weld the ships who's gonna manufacture the

weapons who's gonna actually have the skills to do that and Yeah, the idea, I think, you mentioned that who's going to technical schools nowadays. You know, it's just, I don't even know. Like the high school where my kids went, they are trying now to reopen the automotive, you know, repair section. When I went to high school, all the kids were working on cars. It was part of, you know, everyone was building their own car and doing that. And then a lot of them went on to do that for a living. Where's that?

Who's going to do this stuff now if we don't refocus America on the skills that we need as a nation to be self-sufficient? Could not agree more. I just don't need to say more. Could not agree more. And if it's not done, Jaka, there would be real ramifications to it. Right. I mean, it's a silent killer at the moment because it's getting done. People don't even know it.

But again, average age, I read that average age, the even manufacturing job in the country is 55. Average age. I got to throw one more thing out there because I've, just for anyone that's 18, 19, 20, 22 years old, whenever you are, a lot of times I talk to people and they say, well, you know, I don't want to be doing

that kind of physical labor my whole life. Well, I'm going to tell you right now, if you go, if you become an electrician or you become a plumber, you're not going to do that. If you're smart and you're hardworking and you really get after it and you have the intention of elevating

in that environment, you'll absolutely do it. I mean, who's the guy you were talking about that's a high school graduate? Oh, Jeffrey Martin. So Jeffrey Martin. Is he right now? How old is Jeffrey Martin?

32. His dad owned the business he started at. So he was slinging steel at like 14 or 15, right? So his experience level is crazy, right? So, but he did 20 years of sling steel. He's not in a crawl space anymore, you know? No, no. And so my point is that, and I've got, I've got multiple friends like this that started off, they were an electrician.

And they were an electrician for four years, six years. And then all of a sudden, they got put in charge of two electricians. And then they got put in charge of four electricians. Then they went and said, you know what, if I'm going to be running four electricians, I might as well just have my own business. That's right. And they start their own businesses. and now they have 28 electricians working for them.

And you can go in any one of these trades. If you have the mindset and you want to learn and you want to grow and you want to, you want to take a little extra time to understand the financial part of it, if you have that mindset, you can run any kind of business that you want. So don't think when I'm sitting here or Matt sitting here saying, hey, we need people that are going to know how to weld. We do.

But this doesn't mean you're going to be necessarily welding until you're 62 years old. You can if you want to. That's correct. But if your goal is to grow out of that role, you'll have the experience to do it. You'll have the money to do it. And you will definitely, in this country, have the opportunity to do it.

That's what America provides. 100%. The notion that, by the way, you can't be educated by not going to college is false. The notion is you go to college, you get educated. You can be educated by doing your craft and still learning and being a learning.

and being a learned adult, you just have to take the time to do it. You have to read the books. You have to study on your own. There's the notion that these some things are 100% correlated or wrong. That's part of the mindset is, I know a lot of very smart foreman.

A lot of very smart foreman. You join our company. You start as an installer. It takes your year to get to a foreman, if you're any good. Then after that, a couple years, you can move to super and then production manager. And then ultimately to general manager,

then ultimately to regional manager, and then definitely to regional manager, and then hopefully one day CEO. But the point is, you still have to take and do the work. Do the work of growing your mind, investing in yourself, and you don't have to have a sheepskin to say it. You just have to have the mindset to go learn. And the notion that two are separated is a fallacy, in my opinion. And it's just all, you know, you mentioned Peter Thiel, right?

Peter Thiel, like he's hiring people and he's been doing that. He doesn't care if you went to college or not. And he's running a freaking, you know, he's running a giant company that's moving money, billions of dollars. Look at all these founders out. The big founders, the big name founders, as you see out there, Musk and Thiel and Zuck and all these guys. They don't have a degree. I call him Zuck, Echo, like I know him.

He's your bro. It's my bro. Awesome. Awesome stuff. Probably a good place. So we get to the, so let's just look, where we at right now, groundworks, what's the future? Well, I think ultimately, we want to continue the mission, of course, expand. Look, I think ultimately this is a public company.

I think we're getting to the point we're going to be so big, you're going to need the capital to ultimately go public. I think right now, if you think about our business, we are in the water management displacement business. But, you know, we operate with an MPS over 7. NPS is net promoter. It's how you measure your performance with consumers. You know, we're going to move into other home services lines. We believe our mindset and our ability to service the customer. We think there are other lines that we can get into to further expand our business,

gutters and plumbing and other things. We're just beginning to build this business. And so ultimately, I think groundworks will be, my passion will be that this is a business that lasts 100 years, that a business that celebrates, again, men and women that work with their hands, they can go for not a job, but for a, a profession that's built with a common sense of respect and dignity where it's a true meritocracy that doesn't matter where you come from or what degree you have, that you can

come to a company like Groundworks and make it to the very top. So that's where we're going. That's where we're going. Do I have, look, you heard my career, it's a little bumpy and it's, you know, my buddies call me the forest gump of finance. And some of these stories like that, bro, that can't be true. I swear it's all true. But I don't know.

I just know if we build something great, you invest in people, you surround yourself with really smart people and you push them to grow and be better, you can do anything. Okay. I think that's where we're going. If I could, just make one final comment. As you think about your listeners, as you think about kind of how we started, I would just say this. If you truly sitting there, you want to be in business, you want to be an entrepreneur, and you want to invest in yourself. And you believe that ultimately you get the life you give yourself that you can do it. You can do it.

If you put in the time, you have the discipline, you're obsessed about whatever it is, I hope, you know, the dialogue and you've gathered from our conversation that you, in this country, if you can do it. And a guy like me, you know, knuckle drager from Ocean View, you know, sitting down here with the. and Jocko and his team and the best podcast in the country and the folks I've been able to meet in my career. But most importantly, you can really do the impossible if you really just go after it. And that's, I hope your listeners take away is that anything is possible. It truly is. You just got to go do it. And it's not easy.

Oh, no. And there's going to be nights. And your wife's going to look at you and say, don't send that email. and you're going to have to get up and you're going to take risks and you're going to do things and you're not going to win every time. And that's when it counts. That's when you say you got to keep going. That's when it counts.

Well, character is defined by hardship, right? That's the only way to get better. Look, I'm not a seal. I'll never serve, but I'm sure that's how you guys look at it. But business is no different. And you know that. You're an entrepreneur. The ups and downs, characters really, you learn more on failure than you do on victory.

and the character is defined by the things that make you a better person and a better business person. You know, we believe that at Groundworks. We talk about walking in the light. The goal is to make everyone a better human. And if you're a better human, you're a better professional. And, you know, I joked about the Catholic thing to begin with the morality that kind of instilled. But you can do the impossible if you do walk in the light. You care about others.

You lead with a servant heart. you make the mistakes, you make the investments, you take the risks, you get up every day, even if it's off the ground, and you do it again. If I can do it, anyone can do it. That's America. Echo Charles, any questions? Yeah, you have watched Shark Tank?

Yes, sir. Is that your jam? That's not my jam. You know, it's funny, I actually tell Sarah, say, hey, they're just stealing these companies from these people. You know that. The valuations are giving these guys. It's like, interesting.

So if you ever have an idea, don't go on Shark Tank. You come to see. Yeah, sir, I understand. Okay. All right. Oh, you also said, kind of in passing, you mentioned lifestyle business. You said it was a lifestyle business and you kind of, what does that mean, lifestyle business?

So there are a lot of owners out there that don't reinvest in their business. They take money out of the business to, you know, buy a house or second house or a boat or, you know, that we call those lifestyle businesses. They're nice lifestyle business, but there's no long-term viability and health for those things. They'll die as soon as that owner dies. So kind of almost like they have the business just so they can make money for their lifestyle, essentially, as opposed to growing businesses. Reinvesting every penny they have to make it grow and to build it, et cetera.

You see a lot of small businesses are lifestyle businesses, and there's nothing wrong with that. But when we compete with lifestyle businesses, you can imagine, It's ugly. I watch competition. I understand. Cool. Good to see you. Right on.

Well, Matt, thanks for coming on. Thanks for sharing some of these lessons. And most important, thanks for what you're doing today. I mean, you can probably hear when I talk about this and I talk about all the time,

and I live it too. The fact that you're building a company that is, well, first of all, it's providing a much-needed service, right? I mean, like you said, it's the American dream to have a house.

It's not the American dream to have a house. the basement full of water. But you not only provide that service, but you know, you give ownership to your workforce and they get a skill and they get a career. It's just powerful.

And that helps. That is what drives the American economy. That's what does it. And that attitude, that work ethic, that's the American culture. And look, the American culture might get pushed around

a little bit. It might get some layers put on it by various things that are going on in the world, but the American culture of hard work, the culture of entrepreneurship, and the culture that supersedes all those is the culture of taking care of your family, taking care of your friends, taking care of your community, taking care of your people. That's the American way, and that's how you win. And thank you for being an example of making that happen. Thank you, sir. And with that, Mr. Matt Malone has left the building. So, Echo Charles.

Yes, sir. Did you get a little bit of the beyond the shark tank on that? Because for you, I think in your mind, business is kind of like shark tank. Actually, you're kind of right. No, I think like legit. Yeah. Yeah, well, like anything, you know, you have kind of what's in front of your face. And that goes through like your life, I guess, when you kind of go through it.

And then every once in all you get reminded that there's this bigger game being played or even a smaller game being played that plays a bigger role in your life, you know, like that kind of stuff. And this is like one of those reminders where he's over here talking about like he early on in the in this episode. He was he just mentioned like derivatives. Oh, I didn't want to do that. Like kind of like he was just this foregone. Everyone knows that kind of a tone. and a lot of these terms that he was using was like, wait, and I was going to interrupt,

but in the spirit of keeping the flow, I didn't, where I wanted to interrupt, be like, wait, what's that? Wait, what's that? Because it would tell a clear story for us who are not in that big game to understand a little bit more about how it works. Yeah, well, I guess the, trying to get, like you said,

trying to get to the kind of ultimate position where he got to, where he is now. I think was cool and I think that's and plus maybe I was just like going yeah derivatives you know right yeah it was clear that you probably not the best person to filter some of that stuff out or to inquire about it but what's interesting to well the the the each one like each one of those things is its own world right and what did you what were you calling it next level what were you saying big game no play there's different games man yeah and then there's

games within the games but then more importantly to remember you're in there's a game that's bigger than the game you're in and that's what's always happening yeah and you got to be careful in life that you don't get trapped in the game and think that you won that game because there's a bigger game going on yeah so you need to watch out for it now listen here's the thing you could never very few people are just going to win every game like all the games the big game right What do you got to do? What's the winning the biggest game? Is it Elon Musk and he won like the big game?

It could be. But also there's some people that don't care about any of that. So it's important to remember that. Do you care about the game that someone else is playing? This comes back, this whole discussion we had one time where I was, I compared basketball and soccer, right? Like someone's playing soccer. They're the best soccer play in the world. In their whole season, they score four goals.

And they're the best of that game. Meanwhile, someone plays basketball, they score four goals. goals in the first minute and in the season they play they score thousand points so what game are you playing and you got to be careful because you might be I've known plenty of people in my day and I'm sure you have too that worked really really really hard and won the game that they were playing and were winning that game but it but it was limited yeah you know they weren't really barely even getting on the board yeah so you want to make sure that you're playing a game that you can win.

And then you also, at a certain point, you say, look, I don't really care about that next level game. Yeah. I don't, I don't care about that. I don't need to win the game above my game and the game above that game. Right. I don't care about those games because basically the games we're talking about right now are all business financial earning games.

Yeah. Because, you know, you got a game that you're playing to win with your family, to win with your legacy, to pass on good behaviors to your children. to help your community, to build good relationships. Like there's that too. Your health. Your health.

Right? So we're going to abandon those things. So I think it's important to, and I think Matt spent quite a bit of time doing that. Playing a game and not necessarily winning a game, but saying I don't even want to play that game. Yeah. Oh, and I'm going to try this other game?

I don't like that game. Oh, I'm going to try another game. I don't really like that game. And finally he figured out, oh, here's a game that I like. I actually want to be an operator that makes stuff happen. I want to interact with people. I mean, look, there's some people that don't want to interact with other concubments. Leadership is something they don't even want to do.

They just want to be in charge of, like, their computer screen. Yeah. And that's cool. So. Yeah. And the money part of things is a real easy one to kind of gravitate to as far as your attention. And like, maybe even a lot of time your value system because like, like, like obviously guys like Matt where that's, they're interested in that part of things. You know, the fine, he wanted to be an investment banker.

And, you know, that's not like a rare thing or nothing necessarily, but bro, I'll tell you right now. I never even considered thinking about even that whole industry. And I'm sure a lot of people like that too. It's like, hey, what do you want to be when you grow up? Investment banker is not part of that thing. But investment banking is in, or what's involved in investment banking is a very specific type of thing that people like matter like. That's part of their interests. Like, man, it has to do with something like that.

So when you see the results of a successful guy who's into that kind of stuff, it's easy to be like, oh, yeah, he's winning a bigger, quote unquote, bigger game than me. But I feel like the bigger game that I'm talking about is the game that's like, like if you were to structure your life, then what did he say? What do you do? Scale. That's what you guys use, right? Business guys.

scale it. It's like you can make this, right? But to scale it means you're above maybe 10 people making that same thing 10 times the amount, right? And you scale it. A lot of times that scale game, that's the part we all miss. But investment banking is kind of like, it's part of it anyway, given what I understand, which is not that much. Part of what would drive maybe interest in that industry is the same stuff that's going to draw your interest towards. things like being able to scale X, Y, Z thing. Yeah. Because the interest isn't on the X, Y, Z thing. It's about the scaling part of it. You see what I'm seeing? Yeah. Yeah.

It's good stuff. It is interesting. What I was going to say is that the also, like, for instance, at origin, right, we're making jeans. We could make more money making jeans in China, right? So we could, we could allegedly win a certain part of the game. but we're playing by other rules and we're not winning the game that we want to win. We want to win the game bringing back American manufacturing.

So you got to it's not quite so cut and dry. And the other thing I was thinking about when you just talk about raw money, what are people going to use that money for? A lot if you think about like an end game is you're going to use that money to buy time. Oh, now I don't have to work anymore. I can do whatever I want. Well, how much time did you invest into getting the money so that you could buy time? So you got to run that game. You got to run those numbers.

in your head. Because if you're investing all your time into make money so that you can buy your time back, you might be losing, you know, unless you figure out a way to scale it, which is what you were just talking about. Unless you figured out a way to scale it, you're going to have a hard time doing that. So that's why it's important, in my opinion, to be doing something that you really love doing. You know, I never even ever thought I was working while I was in the Navy. Probably, let me rephrase that. I was very seldom considering what I was doing work. Just didn't seem like work ever.

Like just didn't seem like work. So that's a really good life. You know, I had, I didn't need money to buy time because I had all the time in the world because I was doing exactly what I wanted to all the time. Yeah, that makes sense. So, so that's good stuff. All right. Hey, if you want to invest in your health, get yourself some stuff, some healthy things to put

in your body. Oh, yeah. You know what I'm saying? Yeah, you noticed. You know, when we offered Matt some go. Yeah. What flavor he chose. Yeah.

I am a clean energy champion. Oh, that's right. Undisputed. That's right. Factually. Yeah. You know, it's a good deal. Either way, we did notice Matt chose it.

And, you know, it is what it is. But good news, either way, whatever flavor you pick, boom, you got some clean energy, healthy energy, if you will. Which is not a common thing. You want to talk about uncommon? Yep. It's true. These other, you know, drinks. They they they the funny thing is there's no there's there's like there's no truth in advertising

They don't say they don't say hey we're We're not that good for you But we'll give you like an hour and a half of like hype You don't say that They can throw they can throw they can actually use the term clean energy Yeah, and you could they could be feeding you arsenic Yeah, they don't care yeah because because there's water in it and water's clean. Yeah, water's clean. Yeah, so that's the thing I From Three Mile Island.

Yeah, it depends. So there's a difference between lying and then not telling the truth. You know how there's like half truths and all this stuff. But at the end of the day, it comes from like deception, right? Like are you being deceptive? So my wife used to, and I used to pull this one, me and my wife, my girlfriend at the time, started dating. She would be like, oh, she's like, hey, you're lying. I was like, no, no, I'm not lying about this or whatever.

And she'll be like, no, you're being misleading. And I was like, ooh. I can't deny that part of it because you know, you know, like you know when you're hiding something on purpose or you're adding something making it look bigger than it is on purpose. It's like you're misleading.

It's the same as lying, bro. That's what these energy drink. Companies do. Yeah, they do. So don't fall for that. Don't do it. Misleading lies. Sometimes I see them and I just want to

tell the truth about what they're actually doing. But we are telling the truth about ours. It's good for you. It's true. It's good for you. It's good for you. Get yourself. some of that joccofuel.com get it at wawa get it at vitamin shop we're rolling out a bunch of

other stores who'll continual growth which is pretty cool we're scaling scaling scaling all day for good reason too because you do want to stay capable and healthy of course health is a game that we're playing it's a game that's the one game you can't afford to lose you cannot afford to lose yeah but here's the thing a lot of people are losing that game and we don't even realize it why because like you said you might he might some people focus on the game. So a lot of times this hell thing. You got to focus on that one. Stay in the winter circle.

So yeah, we got the stuff for your joints, some protein, vitamin D for your immunity, all kinds of stuff. OriginUSA.com. That's where you get it. No, that's where you get Jujitsu stuff actually. And clothing. Oh, joccofuel.com, that's my battery. Yeah, look at you. Joccofuel.com. That's where you can get the supplementation stuff.

Origin USA is where you can get the American made from beginning to end, American made clothing. There you go. hoodies on there by the way I just used the heavy where were you snowboarding big bear oh all day legit no how was the how was the snow held up it was right after a storm so oh good pow pow pow all day anyway speaking of pow pow pow jocco store dot com uh jocco store dot com is where you can get your discipline equals freedom stuff your gear

your apparel from there if you want to represent while you're on this path playing the game of health and capability and strength and endurance, by the way. I feel like we don't talk about endurance as much as we could. Get on the mats, man. Get on the mats, that endurance shows up real quick. It'll help your endurance. Or it doesn't show up real quick.

You know what I'm saying? Yes, sir. But when you want to... Like, you get in that, that freaking hardcore guard passing game, that's a fatiguing game. Like, you've got to be metabolically conditioned in the modern day

to pass guard. Yes. It's a new game. Well, I agree with you, not 100%, 110% because you in the guard passing game if they're active we'll call it an active and or aggressive guard passing game you can be the giver or the receiver if you're defending that same game right you better have your condition you're saying good stuff to think about you are correct you are correct but yes if you're you know you want to represent apparel wise when you're on this path jocco store

dot com so you can get the stuff shirt lockers a subscription it's called shirt locker it's a subscription situation where you get a new shirt, different design, creative design every month. What? They are creative. You created some of the designs. Somebody said,

we have one that says everybody must get stoned. Yeah. Which is based on the stoner 63 machine gun that the seals carried in NOM. And I saw Twitter feedback. Someone said, I can't wear this because it's, you know, has to do with smoking marijuana.

And I was like, no. It doesn't have anything to do. Well, I guess it does have a, there's a dual meaning. But that's not how we mean it. Here's how the shirt means it in my view. Tell me what you think about this. So, and I told someone this too. I forget who I told.

But, okay, so you got everyone must get stone, right? Wasn't there like a marijuana issue in Vietnam? There was. It was like there was guys smoking or whatever? Yeah, oh yeah, for sure. So it's almost. So there's like, when you say there's a dual. message there right so it depends on who you are everyone must get stoned like edit

surface values like oh what everyone must get so everyone must smoke weed or from a warrior perspective or whatever everyone must get stoned you see what I'm saying so it's like a dual meaning that's what I'm saying it's so legit I was bomb that this guy wasn't down for the cause kind of basically we see it as and and just to repeat the story I heard from a Vietnam guy that he got his weapon from the armory after someone else had used his weapon and nom he would like took a whatever year off went back to get his weapon and he got went to get his stoner 63 and on the buttstock someone had written everybody must get stoned and if that's not badass come on yet another layer yeah that's the deal

so if you want to get those kind of cool shirts with layers yep go there sure luck jockos store also subscribe if you haven't you want to leave a review if you're in the the mood to leave a review there is that option leave a review you ever see a review i said a review the other day said uh we came for jaco we stayed for echo yeah okay you think they'd be in nicer you think that's true i say they both have their probably equal probability to be honest with you either way hey i'll take it thank you for saying that for feeling that really uh jaco underground Come and check that out $8.18 a month. We got on a little platform that in case things go signways, we'll still be here.

If you can't afford it, then email assistance at jocco underground.com. We got a YouTube channel, Jocko's podcast. We got origin USA. Check out that YouTube channel. Psychological warfare. Got all that stuff going on. Flipside Canvas, Dakota Meyer. By the way, he's, I don't even know when this podcast is coming up, but he's in Ukraine right now.

Just be in Dakota. God bless him. If you want to support his company while he's over in Ukraine, like saving people. By the way, he saves people in America, too. He's a firefighter, and he's a Medal of Honor recipient in case you weren't aware of that. He's got a company here in America. It's called Flipside Canvas.com. Go and check that out.

Buy some cool stuff to hang on your wall. I've written a bunch of books. You can read those. We got Ashton Front. You heard me talk about it today. That's, you know, Matt and Groundworks is in one case study of what we do with businesses, how we help them align their leadership and help them learn how to lead and help them develop leaders. So if you want to check that, I'll go to eshalomfront.com.

And part of what we're doing there is an online training platform. You know, like you heard Matt today say he's got 4,200 employees, 4200 workers, 4200 owners. This is not the biggest company we work with. We work with companies that have 30,000, 50,000, 150,000, 150,000 employees globally. So originally we created a online training platform for that. We decided to open it up to everyone. It's got courses you can take. It's got live interactions.

Go to extreme ownership.com if you want to check that out. And if you want to help service members active and retired, their families, gold star families, you want to get involved in an awesome charity organization. Check out Mark Lee's mom, Mama Lee. She's got an awesome organization. really, truly helps veterans and their families. Go to America's mighty warriors.org if you want to help out. And also check out horses.

And also check out heroes and horses. Dot com. So Micah Fink, just up there. He's out in the bush right now, by the way. Oh, do? Going on whatever 78-day expedition on horseback, cold water baths in the morning, resetting people's brain.

bro and their hearts how you like that and their souls Micah you can use that if you want you can use my verbiage that I just just made up as far as that when I go we are we are both on social media we're there we're not getting sucked up in the algorithm though so watch yourself if you go in there echo that echo Charles I'm at Chocco Willink thanks to Matt Malone for coming here today sharing his lessons and thanks to all the workers out there across the land the tradesmen, the skilled laborers, the men and women that toil every day to build, to construct, to fabricate, to repair, to manufacture, we know, we know that that is the strength of America.

That's what builds America. So thank you to the American worker. Thank you for what you do. And thanks to all the military personnel out there who work their craft to keep America free. so that the workers can work. And also, thanks for the work done by our police and law enforcement, firefighters, paramedics, EMTs, dispatchers, correctional officers, border patrol, secret service, and all first responders who protect us here at home. And to everyone else out there, there is opportunity. But it's not going to knock on your door.

In fact, it's not really even going to let you know it's around. Like, the lights are off. That's what's happening. It's not easy to find. You got to work for it. You've got to kick in some doors, and there's going to be struggles along the way, and you'll have ups and downs.

But if you get started, and you can start in any position, this is America. You can start anywhere. But if you're willing to work hard, and you don't give up, you can find that opportunity, and you can turn that opportunity

into a reality. So go out of it. out there and get after it. And until next time, Zekko and Jock. Out.