The Home Service Expert Podcast - How to Create a Clear Organizational Structure to Inspire Accountability in Your Team

Episode Date: April 9, 2021

Danny Kerr is a Managing Partner at Breakthrough Academy, managing over $900 million worth of revenue and helping over 300 entrepreneurs take their businesses to the next level. At 20 years old, Danny took a leadership position for a franchise company, and grew sales from $400,000 to $1,300,000 in just a single year. In this episode, we talked about hiring, systems, productivity...

Yeah, I mean, I think when you're in startup mode, you don't have an org structure. And honestly, I don't think you're able to because I think you don't even know what your roles are yet. You are all the roles. You're the chief cook and bottle washer, right? So that's fine for a year or two, maybe even three, but that'll burn you out long term because you're going to be doing everyone's job and the company's going to grow and you're suddenly going to have what used to be five hours of everyone's job is now 20 hours of everybody's job, and you're overwhelmed. So really, I look at org structure in a very simple sense. It's, are you the org structure? Is everything on your shoulders? Or is the org structure defined and built to be a structure of its own that you can look at and appreciate versus be weighed down by? 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. All right, I got Danny Kerr coming back with us. He's going to drop some bombs on us.

Danny just moved into a new, gorgeous, amazing house in... Chilliwack. What is it? It's a place called Chilliwack. Chilliwack. Countryside. Beautiful. So, Danny, I'll let you kind of do the intro because I know some of the things have changed a little bit. Sure. Yeah. So, since we were last chatting, things have been evolving over here at BTA.

But some of you guys know who I am. Kind of grew up in the contracting space. Actually, the painting world was where I originated. Some of you have heard of College Pro Painters. That's kind of my upbringing. And went from being a franchisee with them to a GM to helping with recruitment and development for Western Canada. So working with all the franchisees and the general managers. And we had about 150 people under our command at one point. And that was kind of what sparked me to go create

what we call Breakthrough Academy. So we now run 370 active businesses doing about over a billion dollars in revenue combined, and we manage their companies with them. So we manage their financials, their org structure, the recruitment process, their training programs, essentially kind of give them almost like a business in a box to help develop them effectively. And they don't have to reinvent the wheel and get to learn from our mistakes in the past. And so me creating a big, complicated franchise, we created a training process that supports them in a similar way, but we don't own any of the companies.

So that's kind of what we do. I love it. Last time we talked a lot about recruiting and that kind of stuff. Today, what has it been? It's been six months, maybe? Probably, yeah. My dad, he's got COVID pneumonia, and he's staying at some of my apartments, and he just had a bad pain this morning, so I took him to the hospital. But that was at 3.30 this morning. It's now 3.30 in the afternoon.

So if I seem a little tired, it's just because I hung out at the hospital all day. But Danny, let's just jump into it. Let's share about, let's go right into what you've been up far as the United States goes, obviously it's different with Canada, but he just signed $1.9 trillion. You plan on taking a good chunk of that? You want half? I'll take the other half. Call it a day. Yeah, I don't know, man. The rule books are not abiding by anything right now. The economy, the stock market, everything is completely inflated.

I think we're all assuming inflation is happening. I know in the housing market, it certainly is. And that usually dictates the cost of things over time. So there's probably some sort of waterfall trickle down effect that's going to happen over the next few years. I'm not an economist, so I don't know. But from what I can see and judge as an entrepreneur and just basic math,

you add money to an already existing pool of money, but you don't add the resources to accompany it, you have inflation. So some people say through automation and artificial intelligence and all these things coming down the pipe that we'll be able to meet that new money injection through not human labor, but through automation labor.

Certainly is a factor, I'm sure. But I'm curious to see what happens just like the next person. I'm anticipating inflation. I definitely doubled down on the property I bought anyways, just anticipation that it will go up. And it did. Since I bought it, it's already gone up a quarter million dollars in like four months.

So that's an indication of anything to come. We'll see what happens. You know, I've done a few things right in the last year. I bought lots of Bitcoin. I bought that house I told you about and it's done the same thing. But my philosophy is if you raise minimum wage,

we're going to have to raise everybody that's making $15 now wants $16 or $17. And what I'm going to do is raise my prices. I'm going to do is raise my prices. I'm the first one to raise my prices. I think businesses, especially in the home service space, they tend not to realize when to do it. My big thing is the day your manufacturer raises your prices, you raise yours.

It should be identical. We've had two raises. We've got another one next month. My employees are like, dude, this is a lot. I'm like, but you just got to raise. a lot of i'm like but you just gotta raise every time we raise our prices you get a raise as long as you're doing the best thing for the customer so we talked about a lot of topics on the show last last about six months ago but i really want to focus on one big issue and that's um it's one that nobody really talks about. It's the organizational structure and really the org chart.

You know, Al Levy's on. He taught me everything I know about org charts and depth charts. But talk to me about your take on a clear organizational structure. Sure. Yeah, I mean, I think when you're in startup mode, you don't have an org structure. And honestly, I don't think you're able to, because I think you don't even know what your roles are yet. You are all the roles. You're the chief cook and bottle washer, right? So that's fine for a year or two, maybe even three, but that'll burn you out long-term because you're

going to be doing everyone's job and the company's going to grow. And you're suddenly going to have what used to be maybe five hours of everyone's job is now 20 hours of everybody's job and you're suddenly going to have what used to be five hours of everyone's job is now 20 hours of everybody's job. And you're overwhelmed. So really, I look at org structure in a very simple sense. It's are you the org structure? Is everything on your shoulders? Or is the org structure defined and built to be a structure of its own that you can look at and appreciate versus be weighed down by? Yeah, I think the nail on the head, I think an org chart too, is, is basically it's levels of accountability within the company and there needs to be one person accountable for the main things.

You know, it's funny. I did my, uh, I've got this parking lot construction. I'm sorry. There's like all these cat caterpillar things everywhere. So, you know, I said, guys, here's the deal. There's three people in this business. There's us. So, you know, I said, guys, here's the deal. There's three people in this business. There's us, there's you, and then there's the customer. And I said, one thing that I realized is I'm accountable for anything that happens. If you get in a car accident,

we don't call my fleet manager. They call me and say, Hey dude, you're on the insurance. You're the guy we're calling. So I think really embracing the leadership role in each department and realizing there's KPIs evolved around every single thing in the org chart. But my question for you is talk to me about the different types of organizational structures and how should a business be able to choose which one's best for them? Sure. Yeah. I mean, in the space of specifically contracting, I kind of see two major types. So there's the type where you have a sales production manager, so somebody who is dealing with the sales and the production of all the jobs that are coming through. And then there's the separation of the two, where you've got sales off in its own silo, production off in its own silo, and then you have to have really good mechanisms to connect the two. And it's interesting that the idea of doing sales production managers is great in concept. It's great on paper. It actually does work quite well when you have the right person in that role. But those people are extremely hard to find. So recruiting is already hard enough as it is.

And I find it hard to scale up an organization where everybody has to be able to do tons and tons of sales, then be able to manage all the production and the customer service and do all the billing. Taking the weight off of people and letting them specialize in what they do best, I find can be a very effective way to build your structure. And I often promote the, hey, do the separation and work on making sure that the communication channels between the two are really well done. You know, I walk into a lot of businesses, and the front desk girl is also the CSR, is also the dispatcher, is also the bookkeeper. Yep. And the owner goes, why can't I find good people? Or they got an all-star on their hands,

which is few and far between. Landing in a bottle is what Al calls it. Let me ask you this. Are you familiar with the Model T? Landing in a bottle is what Al calls it. Let me ask you this. Are you familiar with the Model T? The Model T as in the old vehicle? Yeah. Yeah.

So there's something that Henry Ford did that's so amazing that I really, really think about when I think about an org chart. That's create an assembly line. And they have specialists that are so good at doing this one piece of the Model T that they were able to do it so good, so concise, and lower the cost of doing it because they didn't need as many people. And Henry Ford was really smart. He used to go around, and at the night shift one day, he put a big six with chalk. And the morning crew came in and go, what's that? He goes, that's what the night crew did. That's what the morning crew came in and go what's that he goes that's what the night crew did that's what the morning crew did seven right and that went on and on so they doubled production because he made it competitive you know what is your take on on millennials anyway because i hear i hear nightmares and i hear good things but it's i'm on the cusp of it i'm technically a millennial what

am i i'm 34 so i'm like right at the cusp and when it all started, I guess you'd say my whole life I've worked with millennials, right? So back in the day, college for painters, everyone I hired was in their twenties and 18, 17, 16 years old. Like that's all I've ever almost worked with. I definitely feel like any generational gap, there's a stigma attached to it. So certainly I think millennials have earned their name for a reason. I think we do generally have a population of people that are a little bit more entitled than probably they should be and haven't been through some of the trials and tribulations that our parents or our parents' parents especially have been through. And so that't have the same type of like millennial generation in certain parts of Asia, right? Because they just didn't go through the same socio factors that we went through.

So I don't know if I look at it and say, well, all millennials are just lazy and entitled and unmotivated people. But I do look at it and I say, there is a different way that we grew up and that gave us a different way to think. My thoughts on it would be, there's some amazing, amazing millennials out there. And if you just discredit the entire group of them all, you're going to miss out on massive gold nuggets. Most of our team are millennials and the most innovative, self-reliant, committed, unique thinkers than almost anybody ever worked with. One of the guys I worked directly with, you know, he's basically my right-hand guy.

He essentially is taking over so much of what we do right now. And you know what? There's some millennial cues that he'll have. And it's funny, sometimes he'll even call himself out. And he's like, I know I'm just being a big millennial right now, but, and then, you know, justifies it. But at the same time, like I've given him tons of freedom and autonomy. I've respected him.

I've made sure he makes great money. I've given him what he needs to feel like he's getting a fair piece of what we do every single day. And in return, he's really innovative. He's really interested in new ways of doing things. He's not looking at what the classical way of doing something was. He's reinventing the wheel every single day. And he thinks differently than a lot of different people. And for that, I respect the hell out of him. And I do find that if you can get good at recruitment and be able to identify those differences in people, you can find amazing people in the millennial generation. You just have to be willing to invest in them and develop them over time. I mean, I've been working with Benji

for, I think it's like three or four years now. And the first year was a lot of high direction, a lot of constant coaching and development of him. But now he's become his own unique individual. He's killing, he's doing better than I am in a lot of things, which is cool to see. So. You know, that's the one thing I always say is I hire around my weaknesses, right? I don't need another really, really good marketing person. I don't need a really good sales coach. I mean, that's stuff I could always brush up on, but it's my passion. But what I do need is really good accounting and bookkeeping and financial statements and the stuff that to be honest I'm not no only not good at them but I find them boring although I look at them every week on Fridays with our financial quick check so I feel like millennials

you know the problem is these people listen to Gary Vaynerchuk and I love Gary Vaynerchuk but they go I want to be on the beach I the beach. They've read the four-hour work week. That's a bad book for people to read early on in their careers. And they got these goals. One thing I find about millennials and maybe the next generation up above there, I think they're Gen X or something, but they have

feelings a lot. Baby boomers just pay me more money. They're like, let me work overtime if I need extra money. I'm going to come here. I'm clocking in. And millennials are like, well, why? Why are we doing it this way?

What's going on? Why is it this way? So you got to talk a little bit more about feelings and you got to make them feel good and feel part of it. And you know what I've tried to do here day one is come up with as much performance pay as possible to give them skin in the game. Talk to me a little bit about, and I don't want to go too far off, but we do have an hour or so. When we talk about org share, we can talk a little bit about, we talked about recruitment last time.

Yeah. But just let's dive into that for a minute. You want to talk about performance-based pay or recruitment? Performance-based pay, I'm sorry. Performance-based pay i'm sorry it's based pay yeah so this is an interesting one because i think people feel like if i just pay them a cool bonus structure they're going to be so motivated to go crush goals so i'm going to start off with this there's a really cool study i watched it first on i think it was ted talks and i researched it a bit more but they basically

went and had two groups of people they had a group of people building a bridge out of popsicle sticks and a group of people i can bridge out of popsicle sticks, and a group of people, I can't remember what it was, it was like digging in a ditch, or it was like a super basic task. And out of those groups, they split them off into a control group and a test group. So the control group wasn't given any bonuses. It was just, go do the task and see how fast you can get it done. The test group was given a bonus. Here's a bonus for hitting it, and if you beat the other group, then you win.

And you get whatever whatever X dollars. The ditch diggers, the ones who were bonused for digging the ditch outperformed the non-bonus ditch diggers all day long, right? The bridge builders built shittier bridges, the ones who were bonused than the ones who were not. And what they deduced out of the study was when it's a complicated task that involves a lot of cognitive thought, when you put too much of a bonus into it, it actually takes them away from problem-solving the actual problem

and they just move to problem-solving how to make more money, which is very interesting. No, it makes sense. You know, I just think that DNA is, we're with them. What's in it for me? I just really feel like I told my orientation, all these guys upstairs, I said, guys, are you going to jump up for joy and tell the world how happy you are when we hit a billion? I'm like, don't pretend that you will. I'm like, but here's what I think we need to do.

I think you probably want to take your wife or your significant other on a great vacation once a year, at least. I think you probably want to have a nice car, probably do fun things for your kids, maybe even spend some time with them. So my job as the owner is to find out what you guys want and match it up with what I want. So we both win together. And I don't always think we bonus only cash, right? I think sometimes we say, we're going to go on this trip. We're going to get to know each other. We're going to have a team building event. And so I'm starting to build a slush fund on performance pay. That's some of its gifting, some of its vacation, some of its, you know, you think of the five love languages that you want to find out what everybody really does. But no, I agree with you.

You pay an engineer a bonus structure working on a bridge to finish faster. You know, you want it to be safer. But I think that's really picking the KPIs around the performance pay. Yeah, like I'll say this, like when you are trying to incentivize your field staff, end of paycheck bonuses work quite well, right? So if you finish this job faster, and you get you make up on some of these hours that we charged out, but you saved on, we'll give you an extra bonus. That makes tons of sense. At the end of the next two weeks, you're going to get a little extra pay, go spend it on beer money or whatever you want, right? Makes sense. When you've got a project manager or a sales manager or somebody managing multiple variables, like quite complex sides of your organization, I still think bonuses are good. Actually, every single person in our team internally has bonuses. We teach it with all of our members. All their staff have bonuses. It's just, it's not the number one focus.

It's saying, hey, we're going to pay you a great base salary. We want to make sure you pay your rent or your mortgage. We want to make sure you can pay your car payments and have food on the table. I don't want to have a stressed out employee who's stressed out about money when they go home. It actually impacts their performance in a very negative way when they are, and they make very bad decisions at work as a result. So that is going to be taken care of. But that's what you're getting paid for to do your baseline job. If you want to be going above and beyond, that's where your bonus structure is going to kick in. And if you want that extra nice house, you want that bigger car or whatever it is, that's where the bonus side is.

So it's not out of desperation anymore. It's out of inspiration that we're giving you this money to be able to evolve your life to the next level. So what is your take on tenure? It's good, especially, and it's important. And I do think there's validity to it. I think it can get out of hand. And I think if you don't have structure around it, people get entitled around it. Right? So when you can say, Hey, we've already pre-established the own every year that you're actually, you know, what's interesting. I don't bonus people for

every year they've been with us. I don't give them a raise automatically. It's for every year they've hit their goals. Yes. Good. So if you hit your goals, then you move up to the next pay structure. And if you can have a pre then you move up to the next pay structure. And if you can have a pre-established pay structure where it's like you go here and then you go here and then you go here and they can actually see it ahead of time and just know that, hey, if I hit five years of goals, I know what my next pay structure is going to be. There's very little negotiation required. There's very little subjectivity to it. It's all very objective. It's here's the five levels of pay that we have as in the company right now. Anyways, here's what you get each year that you hit your goals as you move up. And this is what we're all trying to shoot for. And it's fair and it's across the board. Yeah. I like that. You know, one thing I've learned with performance pay is, uh, be careful. You know, I'll tell a little story here. I, uh, I have a trainer who's amazing

and I hired him and I said, Hey, for every top performer that we put a scorecard out for, I'll give you a good size of money, a good chunk of money, $1,000. Because this guy might be able to make a million. But then I started to go, wait a minute. If he's able to put out 40 guys a month, let's just say it's $1,000. That's half a million dollars but the point was is he was going to need a team now there's eight trainers we're actually bringing on two more so there's six now but there's going to be eight and i said one thing i said on another

podcast recently is i said we do all this regression testing trying to figure out what houses what neighborhoods who's the affluent, what's the dual home ownership money involved in what, what's the dual income, what's their credit score, all these factors. You know, I started thinking about it and I'm like, really, it's really the best trained employees that always win. I don't care where I send them. If I send them to the worst part of town or the best part of town, the training and the personality and the eye contact and body language seems to win every time. I think sometimes when we look at Amazon and Facebook and Google, they're obsessed with data. Very good to be obsessed with data, but they run off of algorithms. We don't run necessarily off the same algorithms. We're out there fixing stuff in people's homes and i think

the failure is we always look at oh we wanted to go after 3 500 square foot homes because they got two ac units that helps but ultimately the main thing that i'd rather do is is really be able to give my guys a scorecard and match them up with the scorecard of the customer and try to have the top ones meeting each other but more and more and more training yeah we're talking about bonus a bit about training but i'm looking at where to really help people focus it's on quality volume and profit and treating them equally and i think if it's all about just ripping out volume all the time people get a little too obsessed over that and profit slips a bit it's all about just ripping out volume all the time people get a little too obsessed over that and profit slips a bit it's all about quality all the time which is great for the customer but the company often suffers and profit slips there's certain things when you're looking and working

with people and you're training with people is to just make sure you're focused on those three properly there's something i was trained a long time ago called the sip principle you first start with skill then intensity and then planning. And that'll start to slowly integrate all these things with them properly. If it's all about just intensity right away, the quality slips, right? If it's all about planning right away, they don't have the skill to actually plan things

properly, so it doesn't really matter. So when training people, I've always just been like, let's just focus in on the skill, get you very good at that, then we'll focus in on increasing that intensity, so doing it quicker and more effectively. And then from there, we'll work on the actual planning. So you can actually objectively start to problem solve how to do this more yourself. I love it. I'll tell you what, you're a smart cookie, man. How long were you in the painting business? From 18 to 26. So about eight years, I guess. Yeah.

That's a tough age. There was lot of beer and uh rumblements those years yep let me pull a couple questions and i got lee here lee said what is a good software to put the org chart together with so we use for a lot of years we've been using something called bubble.us b-u-b-b-l i'm just kidding bubble.us but it's spelt wrong. It's B-B-B-L dot U-S. So B-B-B-L dot U-S. That's the one we get most of our members to use. There's a few better ones. There's actually some stuff we're trialing right now

that we're going to probably shift to. But if I was to make a quick recommendation, that one I've been using for eight years, pretty much. So Bubble.us, free to use. You can get a subscription account. It's pretty cheap. And ultimately, if you just want to mess around a bit and create a quick work structure, you can pop in there, create a login and start right away. So I'm curious on their recruiting systems.

How does the advertised Craigslist actually run ads on Craigslist? What do you find? I know we're not going to go too far down this, but I do want to answer listeners' questions. What do you find to be the best advertising for recruiting? Yeah, so I don't use Craigslist, actually. I have, and I used to spend probably $1,000 a week on it almost. Actually, I'll tell you what I used to do for Craigslist because there is one trick to it. We used to post every day at, what was it again? It was right before lunch, so at 11 a.m. and 4 p.m.

And so it was right before lunchtime at 11 a.m and 4 p.m and so it was right before lunchtime and right before the end of the day yeah so that our post was there ready for them to view versus everybody else's and so we'd have four posts on the same ad except we slightly changed the wording so the algorithm didn't pick us up and we basically every day hit repost and i'd have a little reminder at four and at 11 a.m. And basically I would just repost those ads. And you can repost, I think, after 48 hours. That's why we had four. So we go 11 a.m., 4 p.m., 11 a.m., 4 p.m.

And then basically we'd be back to our original ad for reposting again. But now you have to pay for them. So obviously some ad spend put towards it, but that's how I used to do Craigslist. Honestly, the greatest thing that we use now is Facebook and we use our Teams network. So I don't know why we probably talked about this in the last podcast, but we basically leverage our

Teams network by having them direct message their contacts and send them a link to our landing page to see if they know anybody that would be a good fit. We talk about LinkedIn. We used to use LinkedIn in a very similar fashion as well. So we would direct target. Basically, we'd use LinkedIn Recruiter. You have to pay for it. We could then reverse search and target people with certain job experiences, certain years of experience, certain industries they're in, and then direct message them. Well, first we click to connect with them all. And then we direct message them a very similar ad just saying, do you know anybody who'd be interested in this job? Let them self-select themselves in or out by looking at what we do? You know what? Facebook's the monster. There's a thing called seamless.ai. And seamless.ai will run through LinkedIn as well. And it'll give me the cell phone numbers. It'll give me the addresses. It'll give me crazy data that's accurate because it's not just going to a data dump. But really, what is this word recruiting? It's not putting something out and hiring. So

many people think recruiting is hiring. Recruiting is going out. What does a recruiter do for baseball? They go watch high school baseball and then they take notes and they go out and they make offers. So we've got to get people to change their industry. So what I do on Craigslist, and I don't do a ton of Craigslist anymore, but I'm looking for a guy in my door 48. It's garage door. They build custom garage doors. I'm putting finished carpenter because I want to get a lot of people. Sometimes I put car sales on ads because I really, I put car sales for technicians because sales are important.

I hate to say it, but you know but this stuff is super, super important. And I don't want to get too far along with recruiting, but recruiting is literally the most important thing in my company right now. Well, recruiting and training, right? I don't love Craigslist. It works still. But I've always said this. If you spend $100,000 on advertising a month and you spend $40 recruiting,

do you realize that an A player in your call center will make a million dollars more than a B player? Do you realize the dispatcher? And, you know, I've really just in the last couple weeks realized what HR, what the really core function is. It's not only to bring people in, but it's to push the bad people out on performance improvement plans you may have you top rated your bottom 20 to a players yep you jump up 15 boom and

evade it right off the bat yep it's constant like i think at the end of the day there's that old movie that's just like abc always be closing i'd say this yeah yeah the new world is abr always be recruiting i think he took that from me i don't know i think that's just a thing we all picked up on bro yeah i know i've always say that and and what you got to do is create an incentive plan for your employees because a players you got to create a good incentive plan people are like yeah i'll pay my guys six months after i gave them 200 bucks then Then after a year, I gave them 100 bucks. I'm like, oh, yeah, they're going to get real excited about that. I'm like, we get 1500 right off the top.

We hire that person 1500 bucks. People think it's crazy. I'm like, no, I'm like one guy brought 10 employees last quarter. I mean, now they're out there. They are my headhunters, right? You want to think in terms of how do I give my people the most amount of money, which seems backwards maybe, but it's ultimately a very cool thing when you can set it up where that's what you're excited by doing, right? Like when I look at like a project manager, a great bonus structure we had years ago was around, hey, look, like I'm going to get you to produce a million bucks, let's say at 30% margin. So I'm asking you to bring the company 300 grand, essentially.

But everything over that 300 grand, I want to give you a 10% driver on. So you'll get 10% of any profit you make over that 300 grand. So whether you produce 1.2 million or you do 1 million at whatever, 35%, you'll make a percentage off that. I'm happy because I only budgeted them to bring us 300 grand. So I'm going to make 90% more off that anyways. And I want to make that cap unlimited for them so they don't feel limited in their abilities. And they just say, you know, not just giving up off of just being paid for a paycheck.

You know, that's this next question. And I want you to answer it first. Performance pay for a technician. And let me just tell you, I've never been a fan of just playing hourly. I'll just say hourly to me, I've seen guys and I've had hourly people. They stop at 7-Eleven for 40 minutes. They don't fix the necessary things they should be fixing. But it's a happy medium, too, because you don't want the guy on March 30th charging double because he's got to make his rent.

And that's why we have a price book and checks and balances and secret shoppers and whatnot but you do this with what do you say 380 companies 370 so what do you find for the technicians and then i'll give you my two cents yeah my background actually was everybody we worked with was on piece rate but it was a bit of a unique piece rate where they were employed still, and they still had an hourly base pay. So essentially what we would do is we would say, hey, you have 100 hours to do this job. And if you do it in 90 hours, you still get paid all 100 hours at your hourly rate. If you do it in 110 hours, unfortunately, you still only get the 100 hours. So you kind of went a little over. Now, if you go so far over, say you do it in like 200 hours, you're still going to get minimum wage. So we'll never pay you less than we're

legally allowed to, which is your minimum wage. And that actually allowed us to introduce piece rate to an employee-based system that there is a lot of rules and regulations. Every state's a little different, but in where I was anyways, allowed us to introduce piece rate in kind of a unique way where we're guaranteeing them an hourly rate or an hourly wage, but doing it within a piece rate kind of hourly system, which was kind of interesting. So that gave them a lot of incentive. Now, what I would say is if they ever had a really low quality rating score on a job, they don't get their extra hours. So if they beat budget on something, because they just did a bad job and the customer's not happy, they have to go back and fix it under those piece rated hours, paid or unpaid, depending on where they're at on their

piece rate. And if the customer's still not happy, they don't get any extra hours to be paid out on that job. Hey, I hope you're enjoying this conversation. I just want to let you know that we have a special offer from Breakthrough Academy for you today. So stick with us to the end and I'll reveal how you can take advantage of it. But if you're in a rush, just go to btacademy.com for a slash home service expert and check out our exclusive offer that we put together for our listeners today. Okay. Now let's get back and continue our chat with Danny. You know, I grew up in the transmission business because my dad owned a transmission shop and in the automotive business, you look up the job and it says it pays 3.6 hours. That's what you pay

your guy. If he finishes it in two, he wins. If he finishes it in five, oh well, lost out a little bit, get more efficient, get better tools. But what I do on my pay is I've got a thousand point system and it's, no, don't start out with this because this took me years and years, but they get 400 points up to 400 points and there's always a number one. So the number one guy gets 400. The next guy might get 370. And it's always compared to the mean. But then I add in data integrity.

I add in error reports. I add in yard signs. I add in their average score. We added all these things to make up a thousand points now. And then we pay a certain percentage of the job into three different quadrants of 33%. And then there's different rates for that percentage-wise. But we said, how do we make a system that they care about yard signs? They care about their Yelp and their Google score.

They care about not making a bunch of errors and making sure their inventory is accurate. And then there's some non-negotiables. Your driving score has got to be good or you're getting written up because they're dangerous stuff. So the way you start a performance phase, write down everything that's important to you. And how do you make it so that when they win, you win? That's the most important thing. And I always say there's a million ways to the top of the mountain. There's no wrong answers.

But I will say that I want my really top performers to make six figures as a technician. And if you don't have that, and I don't care if you got insurance and they drive their own vehicle and whatnot, I think in this economy, they got to be able to make six figures. What did you take on that? Yeah. I was just going to comment on this too. I was going to say there's two things not to do. One is if you're going to do like, we actually have a point system for our coaches,

but we make sure it's very clearly defined on like a little chart where they can actually very clearly see what's going on. If you're excited because you're trying to integrate all these random variables into one thing, you better make sure it's simple in the end. Because if it's not simple and they don't understand it, it doesn't actually influence behavior at all. So I think a lot of entrepreneurs like me and you, Tommy, I think we have a lot of ideas. We just have to be very careful. Does this actually make sense? If I was to explain this to my 10 year old, would they understand it? And if they don't, I'd be very cautious to put that as my structure.

And the second big thing is just basically making sure that they have direct control over influencing that metric. Because if it's indirect control, there's animosity that gets created between them and the other person that has that direct control. And sometimes that's somewhat unavoidable. Sometimes when a production manager is trying to hit a certain amount of volume and they have to get a certain amount from sales, it is up to you as an owner to make sure you fuel that engine, but ultimately do your best to make sure that person has direct control to influence the stat or the thing you're working on. Wholeheartedly, that's great advice. You don't want to buy product of what the dispatcher does screw up the score for a technician although they're all going to say i don't get the right zip codes or whatever but that's not that's not true so what we do is you pull out your ti86

calculator and then you get your ruler no i'm just kidding it's like look guys these are the five things we expect of you obviously we want to pay our bills sales is important but we don't need to sell people things they don't need. Diagnose the person before the problem. Let's make sure we fix it right the first time. I'd rather not have to collect $500 10 times over the next two years. I get customers that call me all the time. They're like, I've had this company out four times and I don't care what it costs. I just want to be done with this. It's such a time suck when I can't leave my house because my car is stuck. So I understand that. I have this quick story for you.

And it's a very good story because I got this gal who advertises in the Clipper magazine. She was late one day to a lunch appointment. And she goes, Tommy, I'm going on Yelp. I'm going on Google. I'm going on every site i can find and i'm ripping up this automotive shop i go what happened she goes my battery died and she goes when i got the battery changed out i was there two weeks ago i had to do a complete tune-up it expired around two weeks ago they should have replaced it and i'm like you know some people think they're saving people money but she's furious that it didn't get fixed the right way. Those are my customers.

My customers want it done right the first time. Money's important, but they want it done fast. They want it done right more than they want it done cheap. We're talking about these bonus structures and how to set them up and how to make sure they're incentivizing the right type of behavior. And it's very interesting. I watch i watch all this i'm like this is all good but people sometimes get a little too much in their head about like well they'll cheat the system if i do it if i don't give them or if i don't set it up properly and they find out or they find a different way to hit the bonus and all that goes away when you just have people that actually give a shit he was like you know what do you have the same core values as me do you care about the same things that i care about are you

actually on the train that we're on together? Are you just here for a paycheck? And that becomes pretty clear within three months of working with somebody, right? First month or two, they're pretty eager to please and they'll do whatever you kind of ask them to do. But long term, you start to see it in your staff where you're just like, yes, we have a bonus structure. Yes, it's here to help you have a great life. Yes, it's here to incentivize some of your behavior, but do you care? And if you care like what the rest of us do, then we're going to get along great. And I'll always do whatever it takes to make sure you do well. You know, when COVID hit, the variables changed, right? Very quickly for about

at least one quarter, everything got flipped on its head. And I remember going to my sales team and being like, look, there's things that are going to change over the next quarter. I can't guarantee we're all going to hit our goals,

but I'm going to do my very best to help us hit them by year end. And essentially, that quarter did not go super well. It was not the greatest two or three months. And for a lot of businesses, we had a bit of an upset. Now, what is interesting about contracting space is it all went back up again. Oh, flew up. Yeah. I mean, going into this thing i had less than 200 people now we're 350 it's it's nuts yeah i mean and i'm on i'm on this growth mode man and i'm like oh do not fall out from underneath me because we built a machine right we've got what do you do with all your trainers and recruiters and we've got all this staff that's dedicated for growth and you know it sucks because you've got to make the right decisions for the company because

you want the company to go on because there's other employees. Some people I think have a huge heart and they're like, we're going to lose money. But if you lose money and go under, you screw up a lot of families' lives. You might have to sacrifice for 10 families for the other 150 or 200. You know what I mean? And that's, it's tough to do as a leader, but that's what makes makes us leaders because if we weren't leaders to able to make that decision then we'd be working for them so we got a really good question here let's see john said you have a goal to be a billion my org chart is changing um it's not like a weekly thing but there's some

core principles in my org chart. But for example, I just hired a corporate trainer. That's to make sure that everything, my CSRs, dispatchers and technicians and my door department, the four main jobs here have systems. I can tell you there's a 90 day plan she's working on. She came from the casino industry. We know day one what's going to happen after they're onboarded. Every single day there's surveys and there's things that are getting done, but when you're growing the org chart, I mean, if you're a five person company, it's going to start out with like

five boxes. So I got some thoughts on this. So every year we do a rework every January, we're usually December and we launch it in January. So I'll tell you a couple of things when you're small, it's as simple as this. Make a list of everything you do in a week, every single year. So just reevaluate. What's all the crap and stuff and fun stuff and bad stuff and everything in between that I do?

Cirque all the stuff that's high time consumption and low skill. That stuff needs to become either a new job that you're going to hire for this next year or needs to be delegated down to the team. So that's kind of stage one. When you start to build a team that's a little larger and there's a lot more going on, you want to basically sit down and make a list of what everybody does every single year and look at a couple things.

One, are people doing things that aren't really required anymore, that used to be something we used to do, but we changed the system and now they just keep doing it because no one told them to stop? Is it kind of wasted space and time that you could just delete that off of their job description? Are there things that people are doing that are super automated or automatable that seem robotic, but they're doing it manually because no one took the time to go figure out if there's a process that's downloadable or monthly subscriptionable that

could replace them from having to keep doing that one thing could be put into the automation category. And three is, are there things that my team is doing that they kind of suck at, that we were smaller at the time and they had to kind of do it to bridge the gap, that I might actually be able to bunch together from a few different people's jobs now and create a whole new job and a salary around? That's how I would do it. There's one thing I've learned, you know, Al, another thing he's taught us is ratios are important. We're still below a two to one ratio, but our goal is to get above maybe a three to one. That means the guys that are turning the wrenches, those are the two or three to the one that's in the call. They're the managers. They're the ones not doing the work. So if you look at your orange

chart and there's one for one, it's going to be really hard to make money. So you want to keep your ratios right. And I'll tell you what, I'm using a lot of technology now. What you got to think about is don't hire people when you need them. Hire people before you need them because otherwise it's like, hey, do me a favor. Fog this mirror. That's what I used to tell people. Fog this mirror and you're going to work for me because I need you. I need somebody today.

If a good person comes along, get them. I'm building the infrastructure and it's hard because I'm always chasing that number, that two to one ratio. But you can't grow 300% a year like I'm going to grow, like I've been growing each quarter. you can't grow 300% a year. Like I'm going to grow. Like I've been growing each quarter. You can't grow 300%. You can grow 10% and have really good ratios and the bank loves it, but we're doing so much greenfield. And now we've got a couple of LOIs letter of intents out there for companies planning on buying at least one large garage or company per quarter. And you got to start thinking 10 steps ahead.

There's a book I'm reading called Your Next Five Moves. And what it talks about is in poker, you might lose a couple of hands waiting to get all the chips. In chess, some of the best players know their next 12 moves. So you got to be thinking, what does this company look like and what needs to change and also what's super skilled you know this is kind of off topic a little bit but if there's a department what can you do to take out the hardest part of the job like sales is tough so why not have some closers on your team that just sit in one area and they help get people financed to close the job there's all kinds of stuff like that you could do. There's so many good questions here. I might not be able to get to all of them because I wanted to ask you some of them. You know, delegating seems to be so hard for small business owners because they say the same thing.

If I don't do it, Danny, it won't get done right. Right. That's what we all say. If I don't do it, it won't get done right. I got to tell you what, I don't do a whole lot anymore. I'm what we all say. If I don't do it, it won't get done right. I got to tell you what, I don't do a whole lot anymore. I'm more of the visionary. I would delegate going to the bathroom if I could. I mean, that's something I'd do for sure. I'd get rid of sleeping. Those are a couple of things that have to happen, but I don't enjoy food. I don't hate food. I just, I eat to

eat because my body wants it. So I delegate cooking. I don't want to do it. I don't. So, you know, I'll cook for you, Danny, when you come out here, but that'll be my exception. But what is, what are your thoughts on why is it so hard for leaders sometimes to delegate? I don't think they do it properly. I don't think they understand what delegation actually is because there's a difference between dumping and delegating.

I was going to say that same thing. People go and they say, hey, we're growing. I'm getting more important. Things are moving in my business well. I can afford it even. This person can do it. Oh, you screwed it all up.

Never mind. Let me take it back. Let me take it back. You don't even know what you're doing. Let me show you. And they almost make the person feel bad about it. When really, it's actually on the owner. It's actually the owner's fault that that happened.

And the reality is, there's something that I used to go through. I went through a course on it, actually, which was on situational leadership, where you're learning and understanding what your natural leadership style is compared to what your learner and the progress of where they're at is. And so there's four different stages. There's high direction. So I'm not going to delegate this to you quite yet because you don't know how to do it. So I got to show you every step of the way exactly how something needs to be done and take the time, which unfortunately is more time than most entrepreneurs are willing or able to give, but take the time to fully show them how something is done. All they're doing is just following your direction. They're not thinking much outside of the box at this point. They're just doing what you're saying exactly the way you're saying it and following it to a T. So that could take a week, that could take a month, that could take six months even potentially depending on the role and what's being asked of the person next stage is more of a coaching style so you're starting to evolve them from being like just bean counters that are following your every direction to hey i'm still gonna have the final say in how this all gets done but i'm gonna start

to involve you in the why these things are getting done so i'm going to start to widen your picture and your scope from being just like do do do, do, do, do task oriented to understanding the bigger picture of why something is being done. So you can understand all the variables involved. And when they start to kind of get it, and they start to kind of see it, then you can move them to what I call more of a support role, where you're not basically telling them anything more than they're coming to you all the time with questions. And your question back to them is, what would you do? I trust you, actually, what do you think? And so what they're doing is they're going through a stage with you where they're used to taking your direction and they're used to the comfort blanket of you and they're getting used to actually relying on their own opinion and you start to evolve them where

they're able to be right a lot you know how do we um how do we manage this customer yet xyz thing happened it's like yeah that does sound like a bit of a pickle what would you do if you're in that situation or what would you do if you had to handle it? I'd probably do this, this, and this. Yeah, I would too. That sounds good. Take it and run with it. And so after, you know, a few weeks or a few months of that, they start to gain confidence in themselves and be like, you know what, actually, maybe I do know what I'm doing. Maybe I actually do have the ability to do this. And then, and only then, are you ready to move them to the delegative phase which is you know what man you got it actually you know better than me take it and run with it rock and roll but it's that

hard work and that evolution over time of an individual's skill that's not even for an individual that's an individual's skill in an area of what they're doing with you that you evolve over time that allows you to delegate properly. Yeah. I feel like what we fail to do in a small task is do me a favor, Danny. I want you to repeat after me. Here's the thing is repeat after me what we just went over. You don't have any clue what I just said because I talk too fast because maybe you don't understand it like I do. Maybe I didn't explain it right.

Maybe I didn't use the right vocabulary, but let's go make sure you understand exactly how and why. And then the reason why, but here's the thing, and I'll help me learn this, but, and I got to tell you, this is hard to do all the time, but, you know, I saw on another podcast the other day and the gal was like, yeah, you got it. Do you have your customers sign up the contract,

but I never, I call it an agreement, but you have your customers sign a contractor agreement. Yeah. Well, what happens when you have employees sign on everything? They say they're going to do an initial, but what happens is you might tell, I might say, Danny, I need you to do this, this, this, this, this, this, this. And you're going to go, got it boss. Then I'm going to, okay, here's the form that I just went over. Wait a minute. What am I signing? Let me read this. You know, it's crazy what happens when you, when you get a signature, an ink signature, not an E verify signature, what, what it changes the expectation of how it's done and how you're

going to get rewarded and why I think those are all important things. I think we've got so many questions. I'm going to get one more here with Lee, and then I'm going to ask you a few more questions. Sure. Cool. All right. So how often do you reference your org chart and how do you use it? So internally in our company, we probably do it quarterly. We do a pretty big one at the end of the year. Like we kind of start with, you know, our budget, actually start with our financials first. We very quickly then move to our org chart and just decide who we're hiring. We then move back to the budget

and start to allocate the salaries for that new hiring campaign and make sure it makes sense financially. But that's kind of the big kahuna at the beginning of the year. We'll then do a bit of a checkup every single quarter. And we'll start to kind of look at things. Like right now, we're evolving quite a bit, our marketing team.

And there's things we're learning that we didn't know a quarter ago. We're like, maybe we actually do need somebody in this position. Or maybe we gave this guy a job description that isn't actually what we really need a ton of. And so we start to make small tweaks every single quarter when we do our quarterly review. Outside of that that when we're hiring people we definitely show it to them so part of what their hiring process is with us is actually they'll review our work structure they'll understand where everybody's at in the company and then they'll actually go meet key people in the business as well sometimes everybody actually

in some cases but usually usually it's they'll meet some of the heads of each kind of major area of the company and they'll understand what that person's in charge of and what that person's all about you could do that in your onboarding process we actually do that in our recruiting process just of each kind of major area of the company. And they'll understand what that person's in charge of and what that person's all about. You could do that in your onboarding process. We actually do that in our recruiting process just because most people we recruit take six months to a year to bring on. I love it. There's a great question here.

And I just, I want to go and talk about one thing with this question before you go. What are some gold nuggets you can share with business owners you want to get out of the grind of doing day-to-day tasks. Well, the first thing you need is money. You can't borrow five grand from your mother-in-law and start a business and expect not to. You're putting 10 years of sweat equity into that business. So what I mean, not only underfunded to start, but you don't charge enough money.

You can't afford an assistant. You can't afford to read the books and get the training or hire the consulting that you need because you're not charging enough. And so many people go, I don't have as many expenses. Well, the reason you're working your ass off is because you don't have as much help. So the reason why you get stuck in the day-to-day grind is because you can't afford the people that are going to be, and I don't like problem solvers, to be honest. I really don't like problem solvers. I like people that create processes that avoid problems because I used to have a whole room of firefighters and they were so good because they love fixing fires.

And then I realized, wait a minute, this is going to get super boring, but we're going to stop having fires. We're going to change the process. And it's going to be so much fun when we change the as needed anymore. And I said, I know, I'm sorry. And here's the deal. Some of the people that take you here, can't take you to that next level. But what is your take? Cause we, you get this question a lot. I'm sure is dude, I just got to start working on the business. How do I get out of the day to day? How do I hire more people? There's a lot. I mean, there's a big question, but you were speaking a little bit too. You have to charge more. Here's kind of the tangible reality behind that. You have to have a budget. You have to actually be able to sit down and say, you know what?

We did $650,000 last year. We're going to go for a million this next year. That's going to require us to have this much in labor costs, this much in material costs. That's going to give us this much margin to work with. We're going to spend this much on vehicles and fuel. And you might do your budget and realize, shit, we're only going make two percent like why are we even growing to a million well you have options you could increase your charge rate you could work on decreasing the cost of labor by increasing performance-based pay and getting them more motivated you can tweak your numbers and give

yourself action items off of those tweaks to say these are the changes that need to happen for me to be able to afford the next stage of my business. And once you build your budget, now you have a standard to pit yourself against and say, am I trending to hit this budget month one, month two, month three? And if I am, and I haven't quite got to the year end yet, but if I am, maybe I've got a bit more confidence now to invest in these people that I wanted to go hire. And I'm a big believer that there's a big difference between educated risk and blind risk. And I see it all the time. I go to these conferences and I see people be like, rah, rah, rah, 10x, rah, rah, rah. And I'm like, cool. Do you have the education understanding behind what you're about to go do? And if you do, then awesome, go for it. Because the sky's the limit in North America. There's more opportunity here than we know what to do with. But if you're just getting excited and just going higher, like 20 people overnight of which you have

no idea if they're going to provide an ROI and no structure to help them, you're going to sell yourself short and screw yourself. So just biggest things, like there's a lot of things you could do, build a budget, know your numbers, reflect on your numbers, and let those numbers give you the educated ability to make risk happen or make risk turn into opportunity? You know, my budget this year is 74 million. And then it's, I've got three budgets, take 15% off and add 15%. The stretch goal is an amazing goal. But I got to tell you, 74 million does not include acquisitions and it doesn't include any greenfield. We've already grown to six new markets this year. So that budget is changing as I add markets,

but it depends on what time of year I add the markets, but it's not fair to not count those. I mean, and it's not fair to take your budget and say, I knew I was going to do an acquisition unless it's like your dad giving you a business because there's no for sure way you're going to get that business this is what you do quarterly reviews things change every quarter so you can update your budget we're going to we've already hit almost a year-end goal in the first quarter we're just kind of like okay well better change the change our projections so i'm not doing it tomorrow but we're doing it in about three weeks from now

we're going to update it we're going to change a little bit of our hiring plan we're going to make alterations but at the end of the day if you don't have going to update it. We're going to change a little bit of our hiring plan. We're going to make alterations. But at the end of the day, if you don't have something to start with, then you're not going to have anything to pit anything against or adjust every quarter anyway. I mean, we definitely hit a stretch goal. I only like to change the budget. See, here's the deal. You know what banks ask? They say, did you hit your budget? And I got to tell you, you're in a different business and you've built a very good systematized. And you know, A1 is too, but I can tell you the bank goes, did you hit your budget? But basically if you're short money, that's annoying. If you're

over money, that's super annoying. Like something's going on here. So when a bank looks at you and they go, what is this guy's ability to forecast? I wouldn't be as mad if you were way over your goal. I'd be like, whoa. But I'd kind of go, does he have a decent CFO? Does he have anybody helping him? Because for my business, I know how many people I could train. I know my average tickets. I know it's not going to go through the roof. I've got 14 years of data. I know everything. I can get performance a little bit better. We're going to change our price a little bit. And there's certain things that the bank asks and they say, what were the things that caused that? So COVID made us change our budget a little bit.

It's a really big event. Totally. You hit the nail on the head, man. I mean, I got to tell you, before I met Alan Rohr and Al and some of the people I've hung out with, it's just budgeting. I'm like, why would I have to budget? I'm like, don't put me in this cave of, you know, I'm going to push out of this and I'm going to beat the budget. And I got so annoyed. And now I'm like, man, I love it because whether we hit budget or not.

And, you know, we have not hit budget these last two months, but there's great news. Our supply chain is screwed, and we're on accrual accounting. That means we don't recognize the revenue until the garage door gets installed. I'm actually well above budget when these doors get installed, and I a 72 hour contract that's the right of refusal and they didn't sign it so that's as good as golden court and i don't want to have to go to court with these people but there's supply chain issues with everything i want to start asking you a little bit about breakthrough academy because you're killing it dude i mean i've seen the back end i've seen what you do for these businesses and the way you guys support them with coaches.

And I got something small that I do, but it's more just to get everybody in a group. Let's go through some hard questions. Let's read some books together. I mean, you're at another level that you're really trying to build a business in a box and the franchise model. And I think it's pretty cool. So tell me a little bit about what's happening with Breakthrough Academy. Sure. I mean, obviously early times was just probably similar to what you were doing. It's just like, let's bring in members,

let's provide value, let's make sure they're happy and let's help them grow their company. That was kind of stage one, right? Stage two, we've started to see, hey, there's quite a bit of influence in all these people working together. They're all starting to get to know each other really, really well.

Like there's relationships that are bonding and building in here that a lot of these guys are going to go to each other's weddings and probably some of each other's funerals like they're just they're really tight and it's neat to watch that level of just integration going on and when you've got 370 companies and growing every single day being a part of that collective brain you can start to change an industry. You can actually start to have influence on what actually happens and where things go. So there's certain vendors and suppliers we work with. There's certain people that are involved in what we're doing that are helping us forge a path towards just professionalizing this industry properly and not

making it so hard so that everybody has to go do it alone. Have the collective brain do it together. So we reinvest a ton, like beyond just, you know, making money off of what we do from our memberships, we reinvest a ton. So we're putting a ton of money into new technology this year that's going to help basically create a playbook

that's completely automated through a system that'll be kind of, won't give away everything we're doing, but it'll be basically be kind of like an SOP that's built out for you to use in your field, in the field with the ability to completely integrate that with your project management software and QuickBooks

and have a KPI dashboard to go goal-versus-actual on everything and monitor and manage your org structure effectively, all built into one thing. We're launching a podcast, actually inspired by guys like you. So we're going to build out something where we can really start to put our members up and have them really speak to their stories and what they've been doing.

And there's a lot of stuff going on the back end of BTA that people never get to hear about that we're going to really put our members up our coaches up some of our key suppliers up and vendors that we work with and start to tell the story because people see the public side of bta they don't see what's going on in the back end and man like those things just bring me to tears i'm so happy with watching what's going on we are literally we're changing people we're changing an industry we're watching you know i think i did characters there's 40,000 employees that work under all of our people's management structure.

And it's just neat to have that level of a touch and influence. And what's cool is I did it in a very non-threatening way. I don't own any of these companies. I don't force anybody to pay me royalties. I'm just here to support them. And they're here on their own will. And it's just a very different way of doing business. And it's revolutionizing the industry.

I see it every day. Yeah. And you built a tribe. doing business and it's it's revolutionizing the industry i see it every day so yeah and you you built a tribe you know that you guys are really you feed off of each other they depend on each other a lot of them have been through the same stuff and you know hey my wife or my daughter or my son or i'm supposed to be coaching right now how did and then you can feed off of each other um i'm investing so much in software right now I'm building it together intact I've got ServiceTitan, I've got HubSpot I've got, what is it, Schedule Engine

I've got this other program We're developing from scratch Called Simulator Pro And I can tell you this The software stack that I have Is going to make it almost impossible For anybody to catch me It's so far advanced And the things that it's pulling in with the

data I have, it's almost like you'd have to recreate. And this is nowhere near the sense, but recreate Facebook's algorithm or Google's algorithm, because we've got all this data and we're using it in the right ways. And it's just, we're literally going to change. I truly believe that garage door industry will be changed forever in the next two years.

And I just said, guys, I'm afraid of how many jobs we're going to get. We can't keep up. We'll have more customers. So all my time and energy right now goes, how do we build the machine to put out A players? The jobs come with A players. But it just really struck a nerve because you said, I'm really investing a lot in the software. I mean,

I'm working on dashboards that have every single KPI that matches their pay structure that they get to know in a real moment's notice, boom, and they can see graphs and they can compare to others. And you know, this guy should drive with this guy to learn more about this. And this guy takes too long to do this. So he should drive with this guy.

And it's just, it's a system that says this bar is bigger than this bar so these two should ride together this guy should train this guy how to do it yeah i'm a visual guy so i need that i need that basic stuff so what is a big thing going on here what do you look forward to in 2021 that's a good question i think like just again going back to covid going back to the money being injected into the economy we are literally witnessing the next industrial revolution we're here it's happening we're in front of it we're watching it happen we've watched technology innovate in industries we've watched things kind of move forward we're watching this year is the

year of the electric car and the automated driving vehicle. The contracting space is going to continue to innovate. Everything around us is going to continue to change. And the amount of money that was injected into the economy and the amount of innovation that that's going to create as a result and already started to. Think about how many companies backed off a little bit for a while and started to work on their company when everything got shut down. Think about how much money got injected into their their bank accounts for doing nothing that they can reuse for investment innovation it is happening and it's all going to start to be released in the next year and a half two years think about all the movies that got made that we never got to see brother top down is my big thing it's coming it's coming right so that's

actually a good analogy of like that there's tons of backhand work that has yet to be released into the marketplace. And that's going to happen in our industry in a big way in the next year and a half, two years. And it's going to happen in most industries. We just haven't seen it all publicly yet. You know, I was on a podcast and the lady on the podcast, she told me to get these books on private equity and basically learning more about case studies and transformation of venture capitalists and buyouts and i was talking to a buddy of mine yesterday his name is stephen king and it's not the stephen king in hollywood he uh growth force and he said tommy i'm talking about private equity and what's the long play. And is it a SPAC?

It's a special IPO to go public and all these things. And he goes, there's $300 billion that need to be invested this year. And a lot of it's going to be home service. It's not going to be restaurants. $300 billion. And there's still $3 trillion on the side waiting to get in. And it's all private equity. And private equity,

guess what has to happen? This is super cool. They have to spend the money or they get penalized. That's why the multiples go up. I don't know how you could pay 18 to 20 times and think they're still, but they're buying cashflow. They need cashflow. Cashflow is key. It's just fun to learn about it. The listeners out there, I would familiarize yourself with multiples of EBITDA. I talk about it a lot in private equity and how it works. It's like everybody's getting into it. There's bigger players. There's small cap, medium cap, and large cap.

You got any comments on that? No, just that there's good side set. There's also down set. There's going to be a complete separation between the haves and the have-nots the middle classes for the last 10-15 years been completely dissolved and will continue to be and this is going to amplify that so just to be very aware of that as an individual as you're working with your families and your money and your your savings and the things you're doing i can't tell everyone on listening right now exactly what the right move is because i honestly don't know but what i do know is that it's not time to sit and wait and see things are happening fast and they're happening now and you

have to use your mind to intuitively understand all the variables and make the best decision it is for you personally but things are moving i think we're this to hear me out on this and a lot of people that know although i think are gonna like this but we're turning into socialism but the socialism is because of technology you could grow fruit that's bigger if you know the genotypes and everything and you could make it 10 times bigger and you could have stuff delivered to your house now like uber eats and have a car that drives itself you don't need a lot of money when the technology is doing it and so i'm not a big fan of carl marx and socialism i'm a big fan of winning and capitalism and survival of the

fittest but the deal is that you said haves and have-nots so the have-nots are not going to live a horrible life they're not going to live somewhere on the side of the road no but i do think that their options will be more limited i do think what we're used to as north Americans, having the freedom that we have is going to become threatened and it's, and it's under siege right now. And I'm quite pissed about it, to be honest, but at the same time, there is a certain amount of understanding to it too.

And I don't know fully where I stand with the whole thing yet, but what I do know is things are changing and it pays to be informed and it pays not to just look at one thing. Like I look at many random variables and try and come with to a conclusion. I don't think I'm right. I don't know that I'm right. I just, I refuse to be uneducated in my decision-making and I refuse to use one

source to get it. All I know is the next five years, I'm going to be cashing checks and breaking necks. And then there's that. Because I'm going after it. And, you know, I'm getting to this tipping point where the machine is going to get so strong that it's like, I mean, this is really, I'm not trying to sound cocky or confident or whatever it might be. But the team, the technology, the trademarks, the things that we've done are just better. The truck setups setups the visualization

tools like it's a better way to get a garage door and you know we trademark the garage door is the smile of your home it literally is and we just i believe i'm so passionate about it and i never had a dream that i could be the largest garage company in the world but now i'm like it's like tunnel vision right there and i'll tell you what it's so focused though i'm so focused on what i want and you know shit happens i'm not gonna lie there's always something that comes down your path it's like whoa that that threw you for you know covid if i i could have said i want to be the biggest bar or the biggest hotel. Who knows what can happen? There's things that you can't foresee. And that's why people say, you know, you never know when you should sell.

We'll take some chips off the table because one of the private equity companies, one of the guys I know, the head of it, they just raised $7 billion. They had this huge movie theater tied up. And the deal didn't get done because the movie theaters closed and he felt bad for the guy the owner but the owner sat there and he went bankrupt and it was a multi-hundred million dollar deal can you imagine yeah yeah if you ever want to know how much money's in the world just go stand on top of a tower in a major city and just think about who owns all that real estate and how much money there is just in what you can see let alone what's beyond the horizon and the rest of the world i don't get it i don't even understand because i buy stuff like this

parking lot's 240 000 to get redone i'm like what although we did it but you know let me ask you uh somebody wants to reach out they want to hear more and really work with breakthrough academy what's the best way to do that they can go to our website if they want to check us out directly b as in bravo t as in tango academy a c a d e m y dot com let me read a bit about us check us out um i think from today's talk as we always do we went a little off topic but they want to get some resources i think we have them in your show notes, I believe. And we have a little link set up so they can get those. I don't know if you know how that works, but you probably know more than I do.

Well, I'll tell you. Yeah. You can download the summary at homeserviceexpert.com for us last Danny dash Kurt dash 2021, but you'll just see it there. And I will tell you this, with these two pages, there's no way I could have made that last an hour. So we got a lot of the guests, the people that are on here.

They're awesome. They ask a lot of questions. And last but not least, well, you got three books for me? You always ask me that. I don't read books. You know what I've been doing? I've been watching a lot of Joe Rogan. I've been actually doing a lot of interior design, actually, which is interesting you know what i've been doing i've been watching a

lot of joe rogan i've been actually doing a lot of interior design actually which is interesting because we just moved this new place i've been thoroughly enjoying the creative side of my brain again and just giving it a lot of exercise and yeah that's that's mostly just hanging with my kids that's what i've been injecting to my brain lately you know i'm envious enviable i don't even know that's a word and last but not least i'll give you something here to kind of close us out with maybe the one last thing you want we didn't maybe touch on with some final words to to let the great listeners that are here marinate on and maybe make some changes in their business or life i just think like don't take things i don't know

i gave last time but this is a resonating thing with me right now. I just don't think, take things too seriously in life. Like there's so much that we think we need to control over and there's so much we think we need to grasp and hold. And if we don't have it, our life is over. And I just keep thinking of life as like a Chinese finger trap. Like if you pull and you pull harder, it just gets bloody, right? And if you give in just a little bit and understand what flow really is things go a hell of a lot easier and you can kind of you don't control it directly but you

have indirect control between having a vision for something and having it manifest into reality properly and that sounds fluffy and weird but i keep watching it in my life and i'm just like like i'm willing to go in a direction and drive hard and work crazy hours and do what it takes but i'm also willing to let go when i need to and let go of my agenda and my own self wants and needs for the greater good of things around me and that allows flow to happen in a way that probably is beyond even what i thought i was going to do in the first place i love the word flow you nailed it danny i um i got a big goal this year by the end of, I want to be, have this thing so dialed in that if I leave for a year, I'll come back and it's $200 million more.

I think it's possible. And I'm trying to get the right people on the bus. But more importantly, the process is dialed into a T. Always be improving. That's one of our core values. And I got to tell you, I read a lot of books unlike you but i'm a strange duck i'm not gonna condone that everyone does that i'm just super dyslexic and i just consume no it's not a bad thing but the build the processes the toyota way talks about

what toyota did and the way their cars were way better than american cars for a long long time i'll tell you what you gotta look at every single thing you do on a daily basis and always try to perfect it, always improve it. That's my little takeaway here. Danny, as always, you're just an encyclopedia of smartness and brains that just, you bring it all.

You obviously work with 400 contractors, so you've been through this a bunch of times. I really appreciate it. Sorry about last week. Dude, that's life. That's shit happens, whatever. It's all good. So it's awesome chatting with you. As always, incredible interview, dude. And I think you have an amazing podcast and you're doing really neat stuff for this industry. And I'm in awe of a lot of what you're up to. So thanks, man.

Hey, I hope you enjoyed today's podcast with Danny Kerr. A lot of people always ask me if I could coach them or provide them training to grow their business. The fact is, you guys probably know this, but I'm really, really busy with A1 Garage Service, making it the biggest and largest home service company in the country. But I got to tell you, when I discovered what Danny Kerr was doing with Breakthrough Academy, I realized that this would be a perfect program that I'm proud to vouch for. What I truly love about their program is they combine the done-for-you systems with coaching

and accountability to make sure you make huge progress fast in your business. So if you're making a million dollars or more and you want to build a solid structure for your business to generate more profits and grow, check out the link btacademy.com forward slash homeserviceexpert to learn more about the Breakthrough Academy. You're going to thank me for it.