The Home Service Expert Podcast - Effective Customer Relationship Management Strategies to Scale Your Home Service Business
Episode Date: May 5, 2023Anthony Cafagna is the founder and CEO of All City Plumbing, a highly rated plumbing company established in 2009 during the Great Recession. Based in Rancho Cucamonga, Anthony ensures that his busines...s is up to date with the latest technology and equipment to solve plumbing problems as safely and efficiently as possible. Through his successful leadership in tough economic times, All City Plumbing now has approximately 90 employees, 80 vans and generates over $20 million in annual revenue. In this episode, we talked about pricing strategies, practice groups, CRM strategies...
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that is so important to me.
We actually put it into our scorecard for the KPIs
for the way that the technicians get paid.
That's three KPIs that we track.
One is revenue.
One is number of reviews and then a closing ratio.
And the technicians can elevate their bonus rate
by getting more reviews.
And there's a certain threshold.
We have a minimum that we ask at least eight
five-star reviews per month.
And that is like to earn eight five-star reviews per month. And that is like to
earn eight five-star reviews because we teach lots of people how to do a wow service, provide
five-star service, and we want them to earn the reviews. That way, like when a customer reads
and they're genuine, it doesn't seem like, you know, something got paid to give their review.
You know, we want them to be real, actual, authentic reviews. And then the reviews are
good feedback too when you mess up. So they're really important.
Welcome to the Home Service Expert, where each week, Tommy chats with world-class entrepreneurs
and experts in various fields like marketing, sales, hiring, and leadership to find out what's
really behind their success in business. Now, your host, the home service millionaire, Tommy Mello.
Before we get started, I wanted to share two important things with you.
First, I want you to implement what you learned today.
To do that, you'll have to take a lot of notes.
But I also want you to fully concentrate on the internet.
So I asked my team to take the notes for you.
Just text NOTES, N-O-T-E-S, to 888-526-1299. That's 888-526-1299. And you'll receive a link to download the notes from today's episode. Also, if you haven't got your copy of my newest book,
Elevate, go check it out. I'm going to share with you how I attracted and developed a winning team
that helped me build a $200 million company in 22 states. Just go to elevateandwin.com forward slash podcast to get your copy.
Now, let's get into the interview.
All right, guys, welcome back to the Home Service Expert.
Today's going to be really fun because we got Anthony Cofagna on here.
He's an expert in plumbing, home service innovation, business management.
He's located in Rancho Cacamunga.
And he started the business in 2009.
And Anthony is the founder and CEO of All City Plumbing.
He started the company in the Great Recession and successfully led his team through tough
economic times.
Today, All City Plumbing has approximately 90 employees, 80 vans, and generates over
$20 million in annual revenue.
The company has received the Angie's List Super Service Award for three years in a row.
He kills it on the review game. Yelp, five out of five, which is very difficult to do.
In the last six months, he's expanded into Orange County. Four months ago, he went into LA County.
So he's done this primarily in one location. Anthony,
it's a pleasure to have you on today. Oh, thanks so much, Tommy. I've been listening to you for the last four years. I really look forward every week to listening to your podcast. And it truly
is an honor to be on your show. You definitely helped inspire me and motivate me over the years.
So I just want to say thank you. No, thank you, man. Listen, I put that out there. It's just as
much for me to learn. The people I get on the Listen, I put that out there. It's just as much for me to learn.
The people I get on the podcast, I'm always taking notes.
In fact, before we got started, I just sent a voice note to all my managers about some of the review game we were talking about.
But the way I like to get started is why don't you introduce yourself?
Tell us what it was like in 2009.
A little bit about the business.
What you learned throughout the
years, what were the biggest game changers, and what the future looks like? Yeah, so what it was
like in 2009 was, well, prior to that, I was working for a company that was really busy.
And we were just going call after call after call. And then the Great Recession happened.
At this time, I'm a 25-year-old kid. I don't have a clue what a recession is. I didn't
study that in high school or junior college. So it was just happening. And it slowed the company
down. By that time, I had lots of friends in the community and other companies were slowed down. So
I had this great idea where it was like, hey, if I'm going to be broke, I might as well be broke
working for myself. So I went and just got my license and got a van and just got it going. So that's pretty
much what it was like. It was a struggle for the first five years. I definitely struggled. I
stayed the same. It was like Groundhog Day. And then, you know, I had that breaking point and
things started changing for me. So tell me a little about 20 million. You know,
a lot of people listen to this podcast and they're like, well, we don't want to talk
about 200 million.
We don't want to talk about a billion.
We need to understand the stuff that gets to 5 million and then 10 million.
What were some of the mistakes and what were some of the aha moments?
Yeah, so I definitely made so many mistakes.
I mean, it would take more than one podcast to talk about that.
But, you know, one of the things I was saying is success is going from failure to failure with
no loss of enthusiasm. And I can say once I started going, I definitely went a good five
years straight just going from one problem to the other and losing no enthusiasm, just going,
going, going. And that was like for five years in a row. It was like more vans, more trucks,
more all this and that. But I definitely hit a breaking point. And I ended up
in the middle of two real major lawsuits. And that definitely shocked and broke my little world.
And I wasn't able to, you know, live that quote in real life. I definitely took a couple
steps back. And I was like, Darion, this hurts. I don't know if they answered your question all
the way. But well, yeah, there there's lawsuits and that's in California.
It's prevalent there.
There's a lot of mistakes that happen, but what doesn't kill you makes you stronger.
Right.
So if you don't mind kind of putting more of an explanation, what were some of the things
going on with the lawsuits?
Yeah, they're still ongoing.
I mean, if you were to lay down the top five lawsuits that you could possibly get into, two of the ones I'm in is still actively going on. As far as the doubling, that's why I love listening to these shows. And that's why I listen to them. And they helped me so much. One of the things that helped us double one year was joining Nexstar. There's just no way. That's one thing, a recommendation when you're smaller.
And we still are a baby company,
but when you're taking the baby steps,
joining a best practice organization,
you just have to do it.
Because how else are you going to learn accounting?
Like before I joined Nexstar,
a P&L was something I did once a year
that the CPA did in cash accounting.
And who cares about cash accounting
when you're trying to run a business, right?
You need accrual accounting.
And I just think that joining a best practice group, that's kind of like what's tried and
true.
And joining that will show you, hey, here's your financials.
You need, you know, your P&L by the 10th of every month.
Here's your KPIs.
Here's how to build a price book.
Here's your billable hourly rate, all that stuff.
Just joining a best practice group and wrapping your head around that, boom,
you're going to double.
When you're real small, just hiring a competent digital marketing company and caring about
reviews and pumping people up for reviews.
So just reviews at a digital marketing company, boom, you're going to double, right?
And then when you're really small, I think it's tough when you're working out of your
garage to have the highest hiring standards.
But as you get bigger and more momentum, you know, at least I did.
I raised my hiring standards and then I built a better team and just building a better team.
Having higher standards, you can double. Hiring a company like Service MVP.
We did that. Joe Casera. we started enforcing, giving three options. That was a game changer. Our average ticket skyrocketed. Getting your average ticket way up there, now you can afford more cool stuff. starting off, it doesn't take a whole lot to double, right? You know, you put these two or
three things in the place and then grind it out, pay the price, like work every day. Because
one thing I hear you say a lot, sweat equity, but like, I mean, come on, if you start a business
with no money and no knowledge, like most of us do in the contracting world, it's called,
you need to work that ass. You need to work every day. You know, like you, you started behind the
eight ball, grow up and get to work.
Well, another thing is delayed gratification, right?
You don't go out the day the business starts making money.
It tends to like, we deserve this.
We deserve that.
We need to buy this.
We need to get this.
And it's like, you have no patience with your business.
Why not reinvest?
Why not make it look beautiful?
You couldn't afford new trucks.
Why not reward the company that got you everything?
And reinvest in yourself? You've done it. You're out there getting Joe Crisara and Nextar,
reading books that you listen to the home service expert. And now you're on here and you've got over 30,000 satisfied customers. The problem is for most people, there's no
Nextar network. And actually one of the things that i'm excited about is i've got an amazing show coming up in november called freedom and it's homeservice
freedom.com and it's going to be a game changer because the small guys the small industries which
was garage doors they don't have a chance they don't have anything next door started in 1991
with frank wow yeah and they figured that out over 30 years ago.
So I want to give back to the community.
And I think there's a way to have a win, win, win, win, win across the board and create a lot, a lot of millionaires.
And I don't really talk about this a lot because it's still in process.
But it's going to be the end all be all of getting your company to be extra profitable and accomplishing what you want, not only in your business.
But what do you want out of your life? How do you want to be remembered? What kind of legacy do you want to live? What kind of parents do you want to be extra profitable and accomplishing what you want, not only in your business, but what do you want out of your life? How do you want to be remembered? What kind of
legacy do you want to live? What kind of parents do you want to be? What kind of child, you know,
of your parents do you want to be to them? And I think it goes a lot deeper than just hitting KPIs.
There's a lot of things that we're going to talk about it and freedom that is just going to change
things. What CRM are you using? Right now we're using ServiceTitan. Oh, that's another thing.
I have a friend that is a smaller contractor just starting off.
He started about a year ago and he's had tremendous growth throughout the last year.
But he showed me pictures of a CRM and I'm like, dude, what am I looking at?
And I just forgot how big of a disadvantage it is to be.
I mean, you need a CRM, right?
If you go from paper to even the cheapest CRM, you'll get a big lift. So that was one of the things too. I went from
paper to a basic cheapy CRM, and then I got a big lift there. But then once I went from the cheapy
one to service time, I was like, oh my God, all these call tracking numbers. I love you.
Let's go more here. Let's go less over here. You know, like once you get that,
it's just, wow. Well, I make sure to keep my relationship close to Aaron Vahe and Ed Moles, the CTO and Tom Howers over there. And I always tell them I want to be the beta and
alpha of everything. And I am, and we're helping them grow their business. And we've always have,
and it's a win-win situation because they know I'll get the word out there. They know I'll give them criticism. If it doesn't work properly, we'll make it work. And it's just a massive
machine now. So we've actually had to really do a lot of work on the API. They came out with their
V2 and it's still building before it used to work off of webhooks. But I mean, I'm pushing them
probably harder than anybody else to grow. I mean, there's not one week that's gone by in the last six months that I haven't been on the phone or text messaging eight of the people at Service Type.
Because literally, I think it's going to be very hard to catch up to a company like ours.
And I think with you embracing the technology and asking for more, but it takes a lot of time.
Literally, you need dedicated people because once your KPIs are super dialed in and you could actually get them the next day and
train on them. Like you get mad at a dog when he shits, like right after you spank them and
like you might punish him or something, but you can't do it at two months later.
A lot of people aren't getting their stuff for like, they do their payroll. They count up their
paper invoices. It's a month later when they look at it. And then they're trying to coach on a month
ago and there's great CRMs. It's not only service service titan there's a lot of great crms out there
but how do you keep up with it who would have thought of plumbing garage door hvac companies
on these sophisticated tools oh yeah i mean once you have uh something like service titan you know
there may be some similar to them trying to come up right now, which I think competition is a great thing. I know that Sarah is breaking through there. I just saw a post on
Facebook that can get rich as an investor. And I'm like, hell yeah, because here's the thing,
service time right now is number one by a gazillion miles. Like they have like no competition,
you know? And what's so great is like, I'm like, I don't know. I haven't fully looked into Sarah. I just, you know, when you scroll through Facebook and stuff and I hope that
Sarah becomes like a real player, you know, that means service Titan is going to have to step their
game up, which is going to be great for me because I love service Titan. I'm on service Titan. So
the better service Titan gets, the better I'm going to get, you know?
Yeah. You know, there's no doubt you got to have competition.
Competition is amazing because with competition, it breeds innovation. Yeah. And there's no doubt that's a fact. And I like having options. That's why Nextstar doesn't just say, it's not like they
say you could only sell Goodman. You know, they got partnerships to like two or three choices for
everything. What systems do you have in place to ensure that there's customer satisfaction and you
got a good reputation in the community? We went through a little bit of this stuff, but obviously
reviews are important. It's one of the KPIs you track on their scorecard. You incentivize them
to ask for reviews. What else do you guys do to really make sure you've got the great reputation
out there? So, I mean, that's kind of like one of our core values is that we're a five-star company, you know, and that's one of the things that's really important
to me. And I reflect on the team, you know, it's, you know, I obviously have a great team to have a
good name. You have to have a good team, but that is so important to me. We actually put it into our
scorecard for the KPIs for the way that the technicians get paid. There's three KPIs that we track. One is revenue, one is number of reviews,
and then a closing ratio.
And the technicians can elevate their bonus rate
by getting more reviews.
And there's a certain threshold.
We have a minimum that everybody has to get
at least eight five-star reviews per month.
And that is like to earn eight five-star reviews
because we teach lots of people how to do a wow service, provide-star service and we want them to earn the reviews that way like when
a customer reads and they're genuine it doesn't seem like you know something got paid to give
their review you know we want them to be real actual authentic reviews and then the reviews
are good feedback too when you mess up so they're really important but one of the things that that
we do now we kind of go over the top now and we
got hundreds and hundreds of reviews every month prior to this but now we go a little over the top
we have company season tickets to three professional sports teams and whoever gets the
most reviews a prior week they'll earn tickets to a game like this week there was angel games the
guys won club seat season tickets to angel games they won
tickets to the anaheim ducks and then we also have tickets to the la rams you know that's one thing
that motivates everybody is to win win tickets and they get you know great seats and then we
celebrate them we're in a group chat the second a review comes through we're posting it and
celebrating it and it just becomes part of the company culture.
Like it just, the reviews matter, doing a great job.
And it's just part of the company DNA.
It's absolutely phenomenal that you're able to,
don't just give money.
Money's great.
And a lot of people are like reward, reward, reward.
Give swag, let them represent your company
when they're at home.
Take them out, let them bond with each other. Let them become great friends. Sponsored on the company. And it's the gift that keeps giving. Because then they stay. They're happier. They show up. They feel like they're important. They feel value. And then they can share. Then you say, take a few pictures. I want to see what you got. And then it's a recruiting tool. I mean, it's a great thought just to do that.
But it also is a great thought because you're getting great reviews.
It becomes a recruiting tool.
It helps morale.
It helps not off-boarding a bunch of employees.
There's so many great things that come out of that, and I love that.
Man, the plumbing industry is crazy.
I mean, HVAC, I'd say, really paved the way for me to be where I'm at today.
But plumbing is right there.
Aaron Gaynor was at my house this weekend with Eco Plumbers.
And he comes in every other week.
He stays over.
We play Golden Team.
We whiteboard.
We do fun stuff.
And I love the plumbing industry because there's a lot of money.
I mean, Al Levy was part of Zoom Drains, one of my biggest, best mentors of all time.
And what's evolved over the years that you've seen in the plumbing industry?
So I definitely think that the plumbing industry is working hard to catch up with the HVAC industry as far as working hard to get their average ticket up.
And, you know, in my little world over here,
there's all kinds of really huge HVAC companies that are now going into plumbing, which is great,
you know, because when a successful HVAC company gets in the plumbing, that means that they're
going to be priced right and they're going to pay right. And they're just going to do everything
right. They're going to pull permits and it's like, yay, you know, but more good competition
just lifts all boats. Right. So, yeah, I'm just real thankful that there's a lot of H-block
companies that have been highly successful, you know, moving into plumbing.
I mean, obviously service Titan. So the software, obviously performance pay,
the marketing has shifted, but this leads to my next question. You wrote an article,
the highlights and strategies to attract Gen Z jobs in the plumbing industry.
Why don't you discuss that? Because a lot of people, especially the baby boomers, they're just
like, they're used to paying more and you work harder. You'll work weekends, you'll work nights,
you'll do what I tell you to do. But their employees hate Mondays and the average plumber
is like 53 years old or something.
And I will say baby boomers probably were smarter as far as how to fix stuff.
I mean, they could basically fix anything.
They can take apart something and put in like a washer and fix it.
But Gen Z and millennials were great people.
I'm right at that edge.
And we want to know what's in it for us.
Like, how do we grow in the company?
What's our future look like?
How do we move up the ladder?
Is there a chance to get out of the truck?
But when you wrote that, what were some of the highlights?
Well, I got to admit that I didn't write all of that.
I have a PR company that helps me write things, you know,
because that is written on a higher reading level than I'm able to write.
What's the PR company you use?
So I use Scorpion Digital Marketing
and they'll find articles to help me get links to the website
and they'll ghostwrite articles for me.
They'll give me options like,
hey, what do you think about this?
What do you think about that?
And I'll pick that.
And then they have like a million questions
and then I answer all these questions.
And then after I answer all the questions,
they rewrite it for me in a way that makes me sound smarter. And then they publish it. I'm just being
honest. No, it's good. Listen, one of the biggest things we talk about is recognizing your strengths
and your weaknesses and double down on your strengths and hire people. And why not just
1099 and out to a specialist? You know, I think a lot of the mistakes I've made over the years are I need a person for that.
I need to hire another person for that.
And when you've got a company that just focuses on one thing and they're the best at it and they've got all the right tools and the software subscriptions, so many times we want to in-house everything.
And I've seen huge PE companies with three people on their marketing team because they outsource a lot of it.
And they're massive.
And they get the best reporting. And they and they got specialists and that's what's like
the most amazing thing so you remember any of the things in the uh gen z article that you answered
yeah i mean you know one of the things that i would say is that i just think this is universal
throughout the years is that people want to make money and they want to have fun right you know
people want to be happy so you know you want to make money you want to make money and they want to have fun, right? You know, people want to be happy. So, you know, you want to make money, you want to have fun.
And I just kind of think that over the years of just employing lots of people,
you need to be able to set something up to where people can make a great living
within 50 hours a week.
I've seen lots of team members, you know, go through divorces
and just being a technician for a million years,
I've seen lots of people kind of go through divorces and just being a technician for a million years. I've seen lots of people kind of go through divorces and I just feel like, you know, making a good living
and then working a certain amount of hours so you can somewhat balance out your life is really
important. But, you know, on the flip side for me, when you're a business owner, you just need to get
it and work every single day. Like if you're, if you're breathing, you should be working. You know,
that's what I think. You know, I don't think people know that when they sign up for it.
And unfortunately for most Americans that have a business, they work to pay the bills and they hardly ever get ahead.
And I read a book and I recommend it to everybody.
It's called Acres of Diamonds.
And it's a quick read.
And it says you're allowed to make money.
And money is not the root of all evil it
doesn't say that in the bible it says the love of money is the root of all evil right but there's
nothing wrong with working your butt off and guess what if anybody else talks shit about business
owners they'll work their butts off go start a business and just figure out what's going to make
the most amount of money in the least amount of time what's going to change the outcome the most like the dream 100 and 100 clients
that'll pay you a million dollars a year there's 100 million earn their business work hard to make
sure it's right and don't go after the let's make a deal people like we all start out and
you do the cheap everything and then you just attract the cheapest customers
that's one thing that helped us i think over the years maintain a good name i did do that for a
while and i noticed a lot of my competitors are doing like the cheap drain thing but even if you
do drain cleaning for 59 you're still going to grab customers that complain about 59 so
for 59 it's the last leaders to get in there and do other things.
Like if I'm a plumber, I'm going in and looking at every single drain.
I'm looking at every single toilet.
I'm looking at every single faucet.
I'm looking at the hot water heater.
I'm giving options.
I'm working.
If it were me, I'd be working with your, I know this because of my house.
If I was working on larger houses of wealthy people, I would say, let me see your
home warranty and your mortgage insurance, because I could actually set an alarm to turn the water
off on here. If there's a leak, you said you travel a lot. We could hook this up and it'll
save you money on your bill. You'll get the money back by installing this. The hot water heaters in
Arizona last seven, eight, nine, 10 years. I'll get you a hot water heaters in arizona last seven eight nine ten years i'll get you a hot water heater that's going to last longer that's going to make the temperature
better it's going to be more efficient you're going to save the money in your water bill
i'm going to work on making sure that like i would go in there and just give options like
we talked about joker star says give six options two of the economical two mid-range and two top
tier and you'll fall in the fifth one most of the time. And I believe in that. And you got to be looking at everything. And relationships,
HOA presidents, whether it's home warranty companies or property managers, building the
relationships, I think I could make money doing anything, even on those cheap jobs.
It becomes a lead generator on the home warranties, right?
So there's always a way to do it. And I mean, all the jobs are an opportunity,
no matter what plumbing call you go for, you're getting your foot in the door for bigger
opportunities. You know, I just, I've noticed that a lot of people do the loss leader for the
dreams. And, you know, I definitely understand that. And I implemented that for many years, but like you said, you just, all the jobs are, it doesn't matter. Even if you're
coming out for a drippy faucet, why is the faucet dripping? It's because of water quality, because
of water pressure, you know, like 30% of the pressure regulators that we go to on the homes
are blown out. Like you said, the age of water heaters in california um no one really builds a home with
a water heater that has a drip pan that can protect the home from water damage so i teach
our techs like what do you believe in like what's the average life of a water heater like what do
you believe in and if the water here's exceeded that life and that's an option and that you want
to build into so yeah like just any plumbing call can lead you into water pressure, water quality, you doing the shutoffs or if you spring a leak and it kills the water.
Also, the some of the leak monitoring systems tell you what your incoming water pressure is.
There's endless like any plumbing call can lead into so much because the plumbing systems is huge.
So, I mean, I definitely agree with everything you said.
When it comes to recruiting, is there any systems you have in place to help make sure you're getting the best of the best?
Yeah.
So one of the things that has helped us a lot for recruiting has been Facebook and Instagram and, you know, taking our emails and making a lookalike audience and all that good stuff has been important for us. And then all the portals, you know, we pay to have advertisement on all the portals as far
as Indeed and Glassdoor and Monster and all that stuff. But for us, Indeed and Facebook has been
the best. I kind of think that it's like two-sided, you know, it's like when someone's actually
looking for a job, I feel like they go to Indeed a lot in our market. But when someone's like has
a job, like the people that you'll see more, you can pull them more through Facebook and Instagram. Like Facebook
and Instagram is going to entice people. And it's your job to make the grass look a little greener
so people look a little more, you know. I love it. You know, people go to Google and Yelp when
they're accustomed. People go to Indeed and Glassdoor when they're looking at your company.
Do you help develop B and C players? is that something where when you're working with
somebody that has a strong will to survive like to make it for you that you'll work with them
or what do you do to help bring a b player up to an a player level yeah so for me an a player is
just someone that has a good worth ethic and a good attitude.
So I don't really think in terms of A, B, C, D, F, as far as grades are concerned, you
know, it's like, hey, if you have a good attitude and a good worth ethic, you can do freaking
anything.
So what do you want to do?
How do you motivate them?
Obviously, you do some cool stuff.
But on a personal level, what are the one-on-ones look like?
Do you have regular one-on-ones? Are you coaching them? Do they understand?
Is it like you find something they could work on and really set a goal or how do you handle that?
Yeah. So, I mean, as far as the goal is concerned, we try to look at like how much money people want
to make each month as far as the goal is concerned. And then we look at how, break it down,
you know, like, okay, you want to make this much per month
you're going to get x amount for calls per day this is what your average ticket would have to
look like and then like how can we help you get there and if it has to do with money then i think
we do a good job as far as we have weekly meetings and then we have weekly sales meetings so there's
two meetings a week as far as, you
know, going there and learning the sales process, learning from others. We break people up a lot as
far as sales are concerned. We break people up into table groups of five. The example you gave
was really good. The water heaters exceeded the life expectancy. You know, how do you present that?
How do you sell that water heater if the pressure regulator is blown? So we'll have a table groups of five and they'll go around and then they'll
each try to sell the regulator. Hey, this thing went bad or this water heater has exceeded the
average life and blah, blah, blah. Talk about that. And they'll try to sell to each one.
And then as a table group, they'll pick who did the best job presenting that option and selling
that service. And then the Taylor Group leader will step up
and then they'll teach that to everybody else.
And that's kind of like how everybody learns from each other.
And that's one thing as far as just like making money is concerned.
If that was a goal, obviously people have, you know,
team members that their goal is to get in really good shape.
And one of the guys I just saw, i went a little while without seeing them running them
and you know he just got into great shape and everybody has different goals you know people
want to buy a house and go make money some people want to get all buffed up pretty girl summer ready
yeah no it's good stuff it's important to help people accomplish their personal goals
outside of work that's what great coaches do their personal goals outside of work.
That's what great coaches do is they look outside of just the game.
And I think it's important for leaders in the home service industry to be doing the same.
Do you have any advice that you'd give to business owners who also provide plumbing services?
Yeah, I mean, my number one advice would be, I mean, if you're not even starting a business yet,
I would say join a best practice group or write when you start one.
If you can't afford to start and to join a best practice group when you start, you probably shouldn't start.
So whatever you have to do, if you have to work six, seven days a week at your current company, grind it out, save money, live below your means, stack cash, whatever you have to do.
But joining a best practice group is just essential.
You have to do it. How else you practice group is just essential. Like you have to
do it. How else you can learn it? Like, yeah, you can go on Facebook and DM me, right. And, or I
mean, I'm not like I'm some guru, but like, if you were to go on Facebook and DM me, I would look at
your profile, check it out and see, okay, you know, like, let me help out this dude over here.
I wish someone would help me, but I'm not going to freaking teach you full blown accounting. And
then like like here's
like how you set up your chart of accounts here's your kpis here's what your cost of goods sold you
know i mean like maybe i'll go over that maybe not but it's gonna be like hey join a best practice
group because you'll if you join a best practice group you'll get a coach and then dedicated to
your success and then he'll show you hey you know like this is how you build a price
book and it's how you make a profit and so you just need to pay for the service and you just
need to do it yeah so you learn how to build a price book how to give options do service agreements
oh no that's not something we've gotten into so crm set up what else have you learned from a coach? Well, from the business coach that I got when I had, or I still am part of Nexstar, that was the first game changer.
Like I said, I didn't understand accounting.
I just thought, you know, you go to your CPA and then they do cash accounting and then you pay your taxes, right?
And once you get a business coach and they start like reshaping your mind, you're okay you need to get a pnl by at least the 10th of every month the pnl shouldn't be a surprise like
here's things that you should be looking at prior to that the pnl it should just be like something
that like to verify things you already know and one of the good things about uh next start is that
well when i joined they would just show you the financials of the top companies in there.
But now, in order to see the financials of the top companies, you have to show them your financials, which I forgot what they call it, which is great.
But once I joined and they gave me the financial of the top company, I was like, oh, my God, this is what the gross margin is supposed to be.
Like, this is what my material is supposed to be as a percentage of revenue.
I'm like, man, my stuff is all messed messed up you need to start looking at these top companies like once you see other companies pnls once you see other companies financials and the next star has
so many members so it's like here's what the top companies are doing now you have like a target
okay cool if my material is way higher once you see what's possible like oh that's my material is way higher. Once you see what's possible,
like, oh, my coach is a real life human being.
He showed me the financials of another real company.
They're actually doing this.
Okay, cool.
We can do this.
I love that.
I think it's absolutely phenomenal.
I'm going to ask you a few questions to close out a little bit,
but I know you had some questions for me.
You wanted to interview me a little bit. So let's just do this live on the podcast. What information were you curious about?
Yeah. So I wanted to say, so the question that would really help me a lot for selfish reasons,
if you can go back to the old Tommy Mello, when you were doing 20 million a year,
if you were to like, I saw your Facebook thing with a back to the future that was awesome the
little videos if that car was real and you can go back to the future to tommy mellow at 20 million
like what would you say what would you tell tommy mellow 20 million first thing i'd say is make sure
that you're only as strong as your weakest link make sure you've got the right cfo make sure your
numbers are dead accurate and you understand how to read
it. The second thing I would say is don't always hire people. Try to get lean. Try to come up with
systems and processes and find the right 1099 contractor. Like if it's content writing, find
the best content writer possible and just make sure they stay busy and help them get more work
and have them take
care of you. Another big thing I'd say is do the equity incentive program. There's a strike price
of whatever you're worth today. Get people vested into your company, but use that to attract not A
players, but A plus plus plus players. Because you know, if the company's at 20 million and you're
at 20%, it's 4 million. Let's say there are multiples 10,
that's a $40 million company.
So they come in at 40 million
and you give them 1% and it gets to 100 million.
That 1% of 60 million is $600,000.
Maybe you could give 2% at best.
Maybe you do 20% equity incentive program
to get everybody.
It not only helps you retain people,
but it helps you get the right people in.
The next thing I'd say is make sure you're talking to companies like I did.
But at 20 million, I wasn't doing it enough.
Go visit companies outside of just crossroads, especially HVAC.
Because I had a guy come in here a few years ago and said, you don't sell service agreements sending out commissionable texts.
Because they try to sell more. That's the only way they make money. You got to get hourly texts with a little spiff
if they sell something, but your goal is to build a fence around the customer,
make sure they're taken care of because eventually the system gets old and you replace it. You're
building future revenue. And I would start hanging out with PE companies and start looking at what
they're doing because they're financial engineers. They understand how to borrow money better than anybody, and they know how to leverage
better than anything. And I would just make sure that I'm around the right people, the right circle
of people, and I make sure I have trusted advisors that I could call for anything and try to be the
dumbest guy in the room all the time. I would invest it at 20 million. I would have doubled
down. I scraped every penny I could to
build the best state-of-the-art training center and make sure I've got the best of the best
trainers. I would do more ride-along forms and I would try it before I buy it and make sure I'm
personality profiling every technician. I'm actually, instead of recruiting for customers,
I'd be recruiting for A-plus players that they're smiling all the time. They got the right attitude of abundance.
They want to win. They're younger. And if you give them 10 more years, they're probably going
to be a billionaire somewhere. You see this entrepreneurial spirit, the people that,
and they're part of the business, they can earn equity in the business.
Like they realize there's what's in it for them, I would start looking at how do I motivate people
to win their goals and their dreams and make it so that, and I would just whiteboard and say,
if they win and they buy this house and they were actually able to save 80 grand in a year,
what does that mean for me? And make it so they win and then reverse engineer what I'd have to
charge and how I would have to pay so that I have a win-win. Your whole paradigm shifts after a certain time. And then I would
say probably slow down on the growth of other markets. Try to take serious market share per
market rather than just have a popsicle stand in every location. And that comes from senior
management. That comes from good one-on-ones. That comes through leadership training. That comes from great storytelling. That comes from
finding people that care. And success leaves clues. There's attributes within some leaders
that I could recognize now that I didn't back then, that I didn't know. I would fill a role
to fill a role because I was growing so fast and I didn't realize I needed to keep more of the money
of the revenue. I would say, don't worry as much about revenue as I do about bottom line. I'd probably tell
myself, try to hit 25% before you decide to grow. Because if you can't hit 25%, there's no point of
growing. If you're at 7% in eight markets, you can do the same in a big market at 25%.
That's some of the basics. I think making sure you've got call tracking numbers.
And I mean,
I would tell myself a whole lot of stuff.
I say,
get super lean,
buy new trucks.
Don't use used trucks because quite frankly,
used trucks break down.
There's no tax advantages.
It's not the image you want to portray to your clients.
When you pull up,
if you've got a cheap broken down truck,
they want a cheap job.
That's the customers you're going to attract. I would say do more things outside of work.
Have the people break bread with each other and become best friends and make it fun. Don't make
it so it's dreadful. Don't say, don't have this attitude of, if I don't do it, it won't get done
right. Then you're not hiring the right people. If you don't like anybody's ideas, you probably
don't have the right people. If somebody's ideas don't inspire you and motivate
you and you don't get excited, then you don't have the right leadership staff. You didn't hire the
right people probably because you're too cheap. You didn't do any equity. You don't have anything
what's in it for them. You don't really care enough. And I started thinking, I want a business
that's going to win even when I'm not here. And that's built to last by Jim Collins.
I would have read that book and I would have probably read more books,
which was hard to do back then because it was a lot of firefighting.
And there was a lot of people I kept on because I felt like I owed them,
even though they really didn't respect me the way I respected them.
And I enabled them to kind of act a certain way because they'd been here so long.
And I got comfortable and I was afraid to lose somebody.
But every time I did and I pulled the trigger, we grew dramatically.
And I just realized my comfort zone was the problem that we didn't make leaps and bounds growth.
And I felt like I owed somebody to let them do things
that were not helping the company grow. I didn't have the same growth attitude I have. So those
are some of the things that I could go on and on and on. But what questions do you have about that?
Dude, that's good. Thankfully, this is recorded. I'm gonna have to play that a few times to fully digest everything that you said. I really appreciate that. You know, so I guess another
question that I would have is, I just finished reading Elevate. Well, I read your first book,
Amazing. And then, you know, I just finished reading your second one. When did you start
thinking like that? Like, it was a great read. I love it and i and i definitely there's at least three things i wrote down i'm like dude we're taking massive action on this
joint like three gems like right away and there was other good gems but like when did your brain
start everybody needs to win when did this happen well the whole paradigm shift changed quite a bit
went through covet when people started volunteering to give their PTO and
take pay deductions. We didn't have to use all that stuff. We were fortunate enough to make it
through that standing on our feet. But I realized how expensive it was for turnover. And I realized
hiring a C player instead of an A player. And I started to look at just the variance between a
top guy and a bottom guy and looking at the attitude and paying more attention to like who these people are, what do they do, what inspires them.
And you start to realize that in your interviews and you start to realize success leaves clues.
And I've got a lot of data that I can look at now and really study it.
And instead of going in trying to low cut my vendors, I say, look, how can I help
you? What markets are you struggling in? My product makes some of the best and they make their highest
margins on the best products. So I know there's a win-win and I ask them what their three and
five-year goal. And I try to align myself to let them win too. And then I realized it's not only
the CEO, it's there's managers and you got to get everybody's buy-in.
You got to go in there and there's a lot of people that don't like change.
So you need to convince them.
And there's gatekeepers.
And sometimes you can't get through to the right person.
So you got to go through the gatekeeper and earn their trust.
And the mindset now is I'm pretty content.
I've hit some really astronomical things for my life that I never thought were possible.
And now I believe that I could do so much more. I'm still at an age where I'm just,
I feel like I'm in the fetal stages, but it seems so much easier now. And I, I wasn't comfortable
on stage. Now it's very easy for me to get on stage. I've, there were certain things I knew
I didn't want to hire somebody to speak for me. That didn't make sense. So I knew I would have
to grow. And that's really what I took the time to hire somebody to speak for me. That didn't make sense. So I knew I would have to grow.
And that's really what I took the time to do.
And I just made myself, I got comfortable being uncomfortable.
And as much as great things are going, I still got a lot of work to do.
And the day that I say I've made it, I mean, the company's doing well, but I don't feel
like I'm not even close to being done.
And there's something that money just is not going to just do
for me. I'm not going to go to Hawaii and just disappear forever. I feel like as I continue to
sharpen and sharpen and sharpen the tools and my tool chest, I'm capable of doing anything and
everything I put my mind to, but I can't do it alone. And I need an amazing team. And if they
feel like they're part of it they win i know my
my dreams will come true if their dreams come true and that that was designed yeah one of the
things that you know i've followed you over the years and it's just been amazing what you've been
able to accomplish and you've been like my north star that has helped motivate me i would say many
years ago i just accepted the fact that I'm never going to retire.
Like I have some type of like DNA where I feel weird if I'm not working. And I was just curious
because you've accomplished so much and you can easily retire. I'm sure if you want to,
where does that come from? I mean, what do you think about that? Do you think you're always
going to be grinding and pushing the envelope and going forward? Well, I'll tell you this,
it gets easier. The better people I get, it gets easier. And I'm still having a lot of fun. I put
together on the airplane yesterday, a plan, what my life is going to look like in five years. I
actually read this book. I read three books in the last two days and all of them were absolutely
phenomenal. And one of the books that I read was called Vivid Vision.
And I read it years ago, but it's by Cameron Herold.
And he talks about one of the later chapters.
It's not only a vivid vision for your business and a plan and a budget and a growth strategy,
but he talks about for yourself.
So I got a document here and I called it,
what does life look like in four years?
What's my schedule?
How much am I working?
How much of my vacation?
How much time am I focusing on?
And last week I had Andy Elliott on here and he says,
I took this out of Facebook and I posted this
or I put it into my Google drive.
As a man in my house every day, I have five main goals.
Number one, to grow every day as a godly man.
Number two, to make my children proud of me.
I want to be their hero.
Number three, to protect my family every second of the day.
Number four, to provide for them and give them a dream life.
Number five, to make my wife proud of me.
I want her to admire her man.
And that's some of the stuff. Look, it's not only business.
I want to move people's lives. And I still get excited. I'm not done yet. I haven't lost any
passion. So my biggest goal is, yes, I want to start doing things eventually. I love Elon Musk.
He's helping people in third world countries.
He's helping them connect to the internet and learn more and get out of poverty.
He's working on going to Mars. He's working on clean energy, you know, the solar stuff. He's got satellites. It's crazy. Everything, the rockets that return to where they came from
and just reloads them, which he's launching more satellites in the sky than all the countries
combined. And I think there's a bigger purpose, but I'm still having fun in the sky than all the countries combined and i think there's
a bigger purpose but i'm still having fun in the home service niche i don't think that's ever got
it's a piece of me now but it doesn't define me so i partnered with pe and i rolled a lot i still
don't have for the company i'm the ceo and i've got a job to do that i signed up for and i i'm
still having fun doing it and by the way i'm learning a ton every day. And as I sharpen these tools and learn financial engineering and learn how to use
other people's money and learn, you know, I still got to work on that document. I got to, I think
I'm going to Idaho or we're going to be building a house out in Sandpoint and it's got great
fishing, great golf, great winter sports, But more importantly, it's going to be fun
to bring some of the people I work with,
some of my friends, some of my colleagues,
some of my mentors, and just spend time with them.
I was with my family on Easter.
We were playing a lot of euchre and having some fun.
And it's like, I can't do that all day.
I'm not into work-life balance because I have fun at work,
but I like to fish.
I think what I'm going to do is just, in four to five years, life's going to look a lot different, but I'm still going to be Tommy.
The problem is with me is I'm going to continue to grow.
And a lot of people around me are going to say you've changed.
And I'm going to say you just didn't change.
That's the problem.
You stayed still.
You didn't want to learn.
You didn't ask questions you were
the smartest guy in the room instead of the dumbest guy in the room that's not my fault
i'm still the same old tommy just more knowledgeable because i was the dumbest guy in the room
probably 5.0 or 6.0 yeah exactly oh that was a long answer you know i'm so happy that i'm on here
this is um for my little journey.
This is definitely one of the highlights of my journey to come on your show.
I've been listening to you, like I said, for many years.
And honestly, I look up to you and this is one of my proudest moments.
So I just thank you for everything you've done, especially now joining the, you started
the best practice group.
You're just going to help so many people.
And that's, like I said, I said, another one, my takeaway is join a best practice group. Yeah. I'm part of Nexstar. There's
lots of good ones. I'm actually a member of the home service HMS group. And I went through all
that. It's amazing. And just, you know, don't go at it alone. You're going to burn so many years
trying to figure things out yourself. Like, why would you touch this thing and go owie hot owie hot owie hot like hot water burn baby you know just join the group and collapse
time you know so just it's amazing that you've started that group and done all that well it's
starting in november and you know what's so cool is as i talk to garage door companies across the
country and if anybody knows any great garage door companies,
I think this is very compelling because I'm able to get them on service
tight and give them my price book.
And I'm able to get their chart of accounts dialed in and give them the
best ways to pay vendor discounts and get them on the same payroll
systems.
And then I show them if they do this and they roll into the new company, how much it like they become millionaires overnight and then they get multi millions more and then they can roll again and get multi millions more.
And it's like they don't know it exists.
I'm like pretty happy just knowing like it's almost like this hidden thing that people don't talk about because it hasn't been around for a long time because quite frankly, the home service industry was frowned upon blue
collar. It was just, uh, you know, garage tour guy, a plumber. And now it's like, look, I think
we could create lots and lots and lots, thousands of millionaires. And I love the equity incentive
program because this helps you win, retain, and find great talent. And a lot of people
are so selfish. They would never do anything. And I get it because they felt like they put all the
risk, but there's still a lot of work to be done. You're putting a strike price. This is the bottom.
You're coming in at this price, and then you can reset that every three or six months,
however you design it, when someone else comes on. And it's not vested. It's vested over time,
and you can put certain thresholds on it
so you could do a double combo for an equity incentive plan you got to be here this amount
of time we've got to hit this number and now they're driving towards something and they deserve
to win too so as this new thing comes to light there's going to be lots and lots and lots and
lots and lots of millionaires and yes everybody gets to win. I mean, it's as simple as that. I
mean, when I worked with Cowan, Eric Van Dam and Rob Park, these guys, they literally were teaching
me for years on thresholds and why it makes sense and why 5 million of EBITDA and then 20 million
of EBITDA, then 100 million of EBITDA, then a hundred million of EBITDA. And then beyond that
and how it all works and why it works that way. And I asked a lot of questions, man. And I asked
questions for hours and hours, several times a month. And knowing this knowledge now, it's like,
I always say, it's not really fair. I try to share as much as I can, but I don't really have
to hide anything. I don't, I don't ever look over
my shoulder. I don't have any deep with anybody. I don't talk shit behind people's backs. I tell
it to their face. If I, if I'm unhappy, of course we have management meetings and we discuss certain
things with certain employees and there's a resolution. But as far as just being out there,
I just, I won't be able to know I'm the real deal and I care. And yes, I talk about sales,
but so does the preacher. So does the rabbi. So does the. And yes, I talk about sales, but so does the preacher.
So does the rabbi.
So does the priest.
Yes, I talk about building relationships, but if you're married, so did you.
You figured that out.
So some people are like those used car salesman tricks. And I'm like, what?
Eye contact, asking great questions, giving options, not in your head because you believe
in it.
That's bad.
Calling it promotions instead of financing because financing makes it sound like I'm on food stamps when it's actually
probably something that makes sense for me. 0% financing, who wouldn't do that? That's what the
rich do. And it raises your average ticket. Yes, you pay a dealer fee, but these are all things
that I really do feel like I'm just getting started. I think because the business has evolved and I've had a different role kind of every year that I don't feel like I'm just stuck in this spot.
I enjoy what I do. And if I didn't, I wouldn't be here. I like to ask a few questions, Anthony.
Is there any books that changed your life? Any books that really stand out to you?
Oh, yeah. I'm a huge reader. I've read hundreds and hundreds of books over the years.
Well, one of the first books that changed my life was when I was stagnant for the first five years.
The first book that I read was Mike Aguilero, The Secrets of Business Mastery. That book really
helped pull my head out of my butt and showed me what was possible because I basically, you know, was a tech that started a
business with no money, didn't knew nothing about business. And I burnt the first five years like
Groundhog Day. And I read that book and he did the same thing. That guy was electrician. And then
basically he stayed stagnant for the first 10 years. Then he engaged in personal development
and then boom, off to the races. So that book just helped me a lot just because i think when you're stuck somewhere it really helps to read and understand a story where
the person's kind of just like you i mean obviously when you become more mature as a business owner
you know like hey i can learn from everybody business business it's just the widget and the
kpis and that's what the finance you know like when you can learn from everybody but i feel like
when you're stuck you want to try to go out there and look for someone that's
similar to you. And he was one, and that was one of the books that really helped me a lot.
But now there's so many available podcasts. It's unbelievable. Like the podcasts,
I feel like help more now than books, even though I'm an avid reader, I read books every month.
The most recent book I read was yours. And then I read Alex Ramosi, Gym Launch, I think.
Yeah, that book was crazy good.
Like you got to read that book and understand like his business mind.
And you're like, no wonder this guy's a gazillionaire.
You know, like it's just incredible just to read a book of a business operator.
You get to see how his mind thought about things and things to implement it.
And it makes me want to go buy a gym and get that going.
It's not easy.
Listen, he does a great job.
I like Alex Ramosi a lot.
He made this comment the other day that he says he's 32 and he'd pay all of his money back to be a busboy for to get 10 years back.
And Ken Goodrich would tell you the same thing. He'd take it all away. His private plane and everything to be back busboy for to get 10 years back and ken gooders would tell you the same thing he'd take
it all away his private plane and everything to be back in his youth and the takeaway of that is
enjoy it live it to your best be in the now don't have regrets i think part of your brain needs to
say enjoy today and part of it needs to say make sure we're set up for the future,
but you need to have that good balance.
Is there any other books?
The third one?
You know, one book only because I've listened to all your episodes,
people bring up a million times, Napoleon Hill, think and grow rich.
And every time I hear that book, I'm like, Hey man,
think and grow rich is to prime the pump.
The ultimate book, like you're supposed to read, think Think and Grow Rich just to kind of prime your mind, to get your mind ready for his best work of art, which is The Law of Success and 16 Lessons.
That's the book.
And then, you know, people bring up Think and Grow Rich a lot, but it's really that's just a prime and pump.
Think and Grow Rich is a work of art.
And then, you know.
And how does someone get a hold of you, Anthony?
You can friend me on Facebook.
You know, you can just hit me up.
I'm putting out on the ether that one of the things I've done good reading books,
listening to podcasts and joining best practice groups and many things.
But I'm really in the market for a mentor to help give me some shortcuts.
I'm just putting it out on ether.
If someone has a 50 plus million dollar business,
I promise I'll be a good apprentice and I'll take massive action and I'll
listen. I won't waste your time.
So it's Anthony and it's C A F
A G N a like them on Facebook, find him on Facebook,
friend him and message him.
And is there anything that we didn't cover
that you think business owners
should be thinking about right now?
Yeah, definitely.
So in my market,
people are getting bought up left and right.
Like I can't go more than a few weeks or a month
without some big player getting bought by private equity.
And I would say that for a long time in our industry, we're kind of competing against the unsophisticated dude that
didn't know his numbers and didn't know KPIs, doesn't even know what KPIs is and all that.
I would say now's the time definitely to join a best practice group and to engage in personal
development and take massive action because it's
different now we're competing against sophisticated businesses that have tons of money great data to
take massive action on so and then they have a pool like some of the groups it's like they have
some of the best companies in the nation inside and they're creating a mastermind if you read any
of the napoleon hill books you know how powerful a mastermind is so they're creating a mastermind. If you read any of the Napoleon Hill books, you know how powerful a mastermind is.
So they got money and they're creating masterminds.
So if you're a smaller contractor, now's the time to definitely take your life serious
and step your game up.
Well, I will say this, that all PE companies are created equal.
A lot of PE companies have family offices.
They got family money.
They got investors coming in and they see easy money.
And I'll tell you this, if you go with a PE company that doesn't understand and have a
proven track record and just thinks they're going to do this game of arbitrage, they got
another thing coming.
And I've met dozens of companies that do PE.
And I say, most of them don't know what they're doing.
They think if they buy enough companies and use enough leverage,
and it works in today's economy,
but it's not going to work.
And I'm telling you,
there's going to be something,
and I don't know when,
and I don't know exactly what,
but this is not forever.
This is not going to last.
This isn't like people think,
man, I'm just going to get a little bit bigger.
Man, you got everything you've got. And I'm not, look, I'm not going to get a little bit bigger. Man, you got everything you've got.
And I'm not, look, I'm not pushing people to get this done now.
I think one of my best books I've read is the Private Equity Playbook by Adam Coffey.
And Coffey or whatever.
And I'll tell you what, he told me years ago on the podcast, you should do something sooner than later.
And I waited for all the stars to align and I'll tell you what they did.
And I wouldn't have changed a thing I did. And looking back four months ago, I'm just so happy I made the decisions I did.
And you know, what's nice is I always had money, but now it's like different. I'm doing the right
things. I'm getting the haircut for my house. Now I'm getting more efficient. Everything I'm doing
is finding the right coaches. And I'm not afraid to pay six figures a year to several coaches.
It's crazy because it starts being exponential.
And even the supplements I'm taking
and the tests I'm taking for my health,
before I would never do it
because it was like,
I didn't want to spend the money, I guess.
And I'm pretty frugal.
Now I'm like, look,
you live one life, live your best one.
And I've got the resources, so why not do it? So I'm like three look, you live one life, live your best one. And I've got the resources.
So why not do it?
So I'm like three and a half months into this thing, figuring out all the things I need
for efficiency, the things I need for health, the things I need.
I'm getting more personal assistant, executive assistant, the chef, the hairdresser, the
special person that's helping with travel.
It's like it does get easier and it gets more efficient and it gets more fun.
I think, and that's just my point of view.
I'm not pushing for anybody to sell or take chips off the table.
I don't care what you do.
And it's not the right time for a lot of people, but I'm telling you,
it's not going to last forever.
I just promise you that things are going to change and there's going to be a lot
of disruptors. And if you're not paying attention,
it's going to blow right past you. Yeah. You know, my takeaway would be to just use it as a
motivating factor, right? Like some people want to buy 10 million plus companies or 20 or whatever,
just let that be a motivating factor that, you know, heavy hitters are entering the market,
they're sophisticated, they're well-funded. And make sure you get yours.
Get after it.
Get to work.
Let's go.
Because yeah, the PE companies may own a small percentage of the whole market.
But the thing is, let's just fast forward a handful of years from now.
I'm sure all the PE companies that are back, they care about reviews and building a brand.
So five years from now,
there's 10, 20 companies in this area
that have thousands and thousands of reviews.
And they have the financial means to actually build a brand,
meaning they have the money to spend X amount every month,
every year with no return, right?
Like when you're a smaller guy,
it's like you're paying for click, click, click, clicks, right?
Like click my stuff
call me give me money now click on my stuff call me give me money now they play the long game yeah
yeah like the pd companies they don't have to do that like they're gonna build they do they got
lps believe it or not these companies have about 10 years to get the money back to the lps and
they got a hold for three years because of capital gains so three to seven is their target
and they've got to go back believe it or not they got to talk for three years because of capital gains. So three to seven is their target.
And they've got to go back.
Believe it or not, they got to talk to their LPs and investors on a monthly basis.
And they need to tell them what's going on, what's happening.
Are they meeting budget?
And they can't just say we're spending money to spend money with no goals.
They got to say, this is what we're doing.
We're spending 25% on marketing.
And here's the market share we're going for this year.
This is a play to take market share. And here's how we're doing it. And they got to report on those. Yes, in a test of time, they're not in a hurry, but they've got a plan. And don't let
anybody fool you. They've got an amount of people to invest that are investors that they got to
report to. I mean, listen, I invested in a PE company. I actually court tech in the new fund.
And I get to know everything going on with every investment they make. I get to get monthly
reporting. I get to know what's going on. And they've got a lot of shit riding. I mean, literally,
who's going to invest in them again if they lose money or if they don't make money the year?
And guess what? If you don't make money as a PE company, if you're not increasing the bottom line,
that reduces your leverage.
Because right now, let's say they leverage 8X to get your business.
Let's say you're $100 million.
So they use the banks to leverage.
If you're a $100 million company and you're at, let's just say, $10 million, they could actually borrow $80 and then come up with $20 million.
It's complicated math how it works.
But if you don't grow that $10 million to $20,
they have no more leverage.
They got to use the funds money, which is dilutive.
And these are the things I'm learning about.
I'm telling you, it's fascinating.
And I'm sucking it all in and going, holy shit.
This is like, I thought I was pretty good.
And I wasn't even close.
This is a whole new school.
This is like a whole other ball game yeah but anthony listen i appreciate you very much i'm glad you came on i'm very very
excited about your business and it sounds like you're a student for life and you're you're
adopting the things that are working i appreciate you listening to the podcast even more for coming
on and 20 million is amazing in a market.
And you've got lots of trucks on the road. You're very humble. And it's been an honor.
Thank you so much for everything you do. I appreciate you having me on.
Hey there, thanks for tuning into the podcast today. Before I let you go,
I want to let everybody know that Elevate is out and ready to buy. I can share with you how I attracted a winning team of over 700 employees in over 20 states.
The insights in this book are powerful and can be applied to any business or organization.
It's a real game changer for anyone looking to build and develop a high-performing team like over here at A1 Garage Door Service.
So if you want to learn the secrets that helped me transfer my team from stealing the toilet
paper to a group of 700 plus
employees rowing in the same direction, head over to elevateandwin.com forward slash podcast and
grab a copy of the book. Thanks again for listening and we'll catch up with you next time on the podcast.