The Home Service Expert Podcast - Michael Gerber: Applying the E-myth to Become The Best In Your Industry

Episode Date: March 27, 2020

Michael‌ ‌Gerber‌ ‌is‌ ‌known‌ ‌to‌ ‌many‌ ‌as‌ ‌"The‌ ‌World's‌ ‌#1‌ ‌Small‌ ‌Business‌ ‌Guru."‌ ‌He‌ ‌is‌ ‌the‌ ‌author‌ ‌of‌��‌the‌ ‌bestselling‌ ‌E-myth‌ ‌series,‌ ‌as‌ ‌well‌ ‌as‌ ‌the‌ ‌Co-founder‌ ‌and‌ ‌Chairman‌ ‌of‌ ‌the‌ ‌Michael‌ ‌E.‌ ‌Gerber‌ ‌Companies,‌ ‌a‌ ‌group‌ ‌of‌ ‌diverse‌ ‌enterprises‌ ‌behind‌ ‌top-class‌ ‌start-ups‌ ‌and‌ ‌entrepreneurs‌ ‌across‌ ‌countless‌ ‌industries‌ ‌and‌ ‌economies.‌ ‌ ‌  ‌ In‌ ‌this‌ ‌episode,‌ ‌we‌ ‌talked‌ ‌about‌ ‌business‌ ‌strategy,‌ ‌monetization,‌ ‌profitability,‌ ‌small‌ ‌business...‌ 

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 and the legend who wrote the original E-Myth. And then they partnered up with Kent Goodrich and wrote the one for HVAC and plumbing, which was great as well. This is the original book. It got wet for me. But the story goes like this. 2007, I started my business and I met with my CPA and he said look I want you to read this book for me and this is the first book he handed me in 2007 and it changed my life and so for our book club I got to pick my book and I said

you got to read the original E-Myth well revisited so and of course this is where I take my notes at the house cuz I didn't have paper. And then I got a bunch of questions here. So I don't know where to start. Maybe you could just tell us a little bit about your journey and why you wrote the E-Myth. I know it's in the book, but it's a pleasure having you here. And Ken, as usual, that podcast we just did was killer. Really, really great. Well, if that was killer, then this is going to be gargantuan. This is

going to be better. Yeah. So go ahead and tell the audience. It's very, very simple. I say it's very simple. A friend of mine who owned a small advertising agency in Silicon Valley asked me if I'd come to meet with one of his clients. And he had a small high-tech company in Silicon Valley that he'd started up. He had a bunch of salespeople called engineering salespeople, and they couldn't convert the leads that were being created for them through my friend's ad agency. So he said, Michael, you got to meet with this guy and talk to him and maybe help him understand what he had to do. And I said, I don't know anything about business. So what will I talk about? He said, don't worry, you know more than you think you do.

And I said, well, if you want me to do it, I'll go do it. So I sit down with Bob, who owned this small high tech firm, and I have no idea to this day what he sold. And Ace, my friend and my brother-in-law, said, look, guys, spend an hour together. I'll be back to pick Michael up in an hour. So Bob is seeing Ace leave, and he's looking at me. He's saying, Michael, what do you know about my business? I said, nothing, Bob. And he looks a little disg. He's saying Michael. What do you know about my business? I said nothing Bob And he looks a little disgusted looks at his watch

We've got an hour to kill with his idiot who doesn't know anything about my business Who's gonna tell me how to convert these leads? For a product that we sell so he says well if you don't know anything about my business What do you know about my product? I said, less than that, Bob. So Gerber, you understand, if you don't know anything about my business, you don't know anything about my product, how can you possibly help me? I said, I haven't a clue. But Ace, my brother-in-law who owns the ad agency who's creating the leads,

thinks I can. And we've got an hour to to kill so let's find out. Okay. So I started that conversation knowing I don't know anything about business and in the process I started asking him questions and I keep on getting anecdotal answers. You understand he didn't know anything either. Anecdotal answers. Well, sort of. Well, sort of. Well, sort of.

Well, sort of. And the more and more I ask these questions, I realize what's missing in this business. He doesn't have a selling system. He was depending upon engineers who understand the product, who had sales experience. But he didn't have a selling system. So we came to the realization what was missing in his business was a selling system. But the more I realized that, I realized he didn't have a management system either. And the more I realized that, I realized he didn't have an operational system either or a financial system either. So it was obvious this guy is winging it, doing it, doing it, doing it, as I ultimately said.

And he needed to create a selling system at the heart of this. So he said, well, can you help me do that? I said, sure, bud. You understand? I'd never created a selling system. I just used them and in the process Ace comes back to pick me up he said what happened I said he just retained me as his consultant to huge amount of build a selling system he said but you don't know anything about his business

and you don't know I said Ace I told you that before I came here, but I know more than I think I did. You were right. That was the beginning of E-Myth. That very experience was the beginning of E-Myth. And then there was another client in a furniture business, another client in an advertising business, another client and on and on and on and on. And then I suddenly realized Ace didn't really buy what I was saying either in his advertising company so I had to go out on my own. Ace brought in a guy to take over for me while I went off to start my own whatever lunacy yeah and the guy after spending a week with me there, watching what I did, he said, I want to go with you. Wow. And that guy was named Tom, Tom Travisano.

And Tom and I went and created the very first business development firm in the world to become the very first business coaches on the planet. And the Michael Thomas Corporation was the foundation for everything we've learned and done since, with over 100,000 clients, with companies throughout the world, in quotes, doing the E-Myth, and now doing the Mike Lee Gerber process for transforming the state of their business worldwide. And that's what Ken did. Ken, you read the book how many times? 39. 39 times.

I've read it probably a dozen. Over 2 million copies sold. Probably a lot more than that. Millions more now. Millions and millions more. Millions and millions more. I mean, it's affordable and everybody needs to read it let me hold that book up

can you see that book as weathered as this book is and this book should be shining it should be in gold it should be in silver and platinum as weathered as this book is it's so critical for you to understand that at the heart of Ken's company

at the heart of Tommy's company, at the heart of Tommy's company, this book is alive and well, and it cost Ken less than $12. I'm sure when he bought it. How much? Well, it was a gift. Well, there you go. It was a gift. He didn't have to pay for it. So let me jump in on the 39 times so everybody understands. I didn't sit down carefully in my chair at home and read it 39 times. What I did was, you know, I was in a crisis situation in my business. And, you know, I had, without, I think we told the story last time, but, so I got, a friend had given me the book and when the crisis happened, I didn't go leave the office that night and I read it the first time and I couldn't be like, how did this guy has been hiding in the bushes watching me?

And he wrote a book after what I'm doing, but he disguised my name because I, you know, how does he know all this stuff that I'm doing wrong? And so I read it. that's the first time. And then that was over the weekend. I read it two more times then. And then I was a contractor, so I wore jeans. And I put it in my back pocket. And I carried it with me.

And so as I would get stuck or I would get frustrated and things not working I'd pull it out and I'd just sit find a quiet place and I'd start reading again and that's how but I kept it with me for three years so 39 times over three years I guess once and once a month or so but and that's what it was it was kind of like my my guiding light and i and when i get stuck like what am i doing wrong here and i would go find the section i would read it again oh yeah okay i'm gonna go do that that's what's happened millions upon millions oh yeah millions of times i mean i my favorite, and there's so many good parts of the book, but I love it when he says, the fat guy and the skinny guy.

And the skinny guy is the hardworking, wakes up early, and it changes everything. And then you got the fat guy, and the fat guy's in your ear, and that's the technician. You have the technician, the entrepreneur, and the manager. And the technician is who normally runs businesses. I'd say 95%, I don't know the statistic, but tons of these businesses are run by the technicians that says,

I know how to do HVAC or plumbing or garage doors. I should go start a business. But they don't understand how much work and dedication. They don't have businesses, they have jobs. And then you talk a lot about the infancy, adolescence, and then the mature business. And most people get stuck in that infancy chase, that stage of their company.

So talk a little bit about the infancy stage. And you can talk a little bit about your business too, but just what you've seen over and over millions of times and why they don't get out of this technician role? Yeah, well, it's very, very simple. You understand somebody's got a job and everybody here who's listening to us knows what a job is. It's where you go to work every day and you're doing it, doing it, doing it, doing it, busy, busy, busy, busy. And you hate the job and you hate your boss and you hate the fact that you can't possibly control everything that happens.

And you realize that if you were to go out and do this on your own, you could have all the money instead of a piece of the money. You could become your own boss instead of working for an idiot who's constantly asking to do stuff that you don't want to do. You don't want to think about, you don't want to hear about, et cetera, and so forth. And so you finally come to the conclusion that what I'm going to do is go out and create my own company. I'm going to go out and become my own landscape contractor. I'm going to become my own real estate agent. I'm going to become my own optometrist, my own dentist, et cetera, and so forth. And what do you do? You go to work in the company being the person

you set out to be. Now you're the dentist and you're the owner of that dental practice. Right. Now you're working for a lunatic and that lunatic has no idea how to run a successfully effective dental practice or a door company or a window company or any kind of company whatsoever. And in Ken's case, it's a HVAC company. So he went to work in this company, doing it, doing it, doing it, doing it, installing HVAC, selling HVAC, cleaning up HVAC, repairing HVAC, all the stuff that a technician learns how to do. And your dad taught you really well how to do that. But your dad didn't teach you how to run a business doing that.

My dad didn't know how to run a business. That's the point. So even worse, you got a father who doesn't know how to do it, and he's teaching you how to do what he doesn't know how to do. And that's the chaos. And they are everywhere you look, up and down the street of America, of the UK, of Australia, of Switzerland, everywhere in the world. It's a universal problem. We solved that problem by identifying what doesn't work in order to go to work on it to create what does work. And that means that ultimately when you discover that system,

that system at the very beginning, that system for doing what you're setting out to do, you can remove yourself from that system while the system works. And that's why Tommy Mello isn't sitting here doing a garage door. It's because it does the garage door. Tommy doesn't. Tommy invents a company that does the garage door. And that company that does the garage door is the system that Tommy has invented. By reading the E-Myth Revisited, why most small businesses don't work and what to do about it. And that's why Tommy, by the way, is going to become my co-author for the E-Myth Garage Door Company. Yes. Why most garage door companies suck big time and what to do about it yeah you're right you got it you know ken you can talk a little bit this is great i love this i got

so many more hopefully this one's gonna go a little long i think but uh ken you you started out you went through everything you've you've had your battles. You had the IRS come after you. You didn't have a pot to piss in. And now you've flipped how many companies? So I've monetized 24 businesses so far. 24 businesses. And you just said you were at the Super Bowl and hurt your back because you were on a yacht. Can I just interject a point? Yeah.

Because you said something and he said something. And I don't think anybody sitting here listening knows what Ken means when he says, I monetized 24 businesses. So I think we've got to get really clear about what Ken means when he says, I monetized 24 businesses. Because for them to appreciate what that means, and that means something immensely significant, you got to understand exactly what Ken is talking. Can you tell them what you're talking about? How do you monetize a business? Well, monetize is that that I either sold some or all of the business for a significant profit,

a infinite amount of return on my investment. So wait a second, do you get what he, we'll put it into really easy language. I sold 24 companies for significantly more than they cost me to create, significantly more than they cost me to create. Significantly more than they cost me to create. That's what Ken said. Now, he did that in the beginning.

Now, he's doing that double, triple, quadruple today. What's it worth today? Well, my goal is to take my latest venture and monetize it for a half a billion. There you go. 500 million in the next 24 months. Did you get that? Did you all get that? Did you get that?

500 million. So, let me ask you this. So if I reverse that, I'm gonna take 500 million and I'm gonna use a simple multiple of 10. So you build, so basically you need to do $50 million profit, but you're going to get a higher multiple than that at those numbers. But so 50 million profit. So if you're at 20% times it by five,

you're doing 250 million to become a $500 million company. Now that might not make sense, but basically all I did was take your number you're getting a multiple that we talk about and uh so 250 million and you've got a path to get there and what's nice is what i love about this is our what's arbitrage you buy a company and you just told me you're getting to put an loi letter of intent on another another business. We talked two days ago. And you just go in, give them your systems, and it's all of a sudden worth 12 to 15 times what you paid three times for. Isn't that genius?

It's like, I'm glad I'm 36. I wish I learned when I was 20 how this is done. Let me tell you how I really got here, though. This is what I want everybody to understand. I had a tragic event in the business. It fell apart. And I had to put it back together. I got the book.

I studied the book. I lived the book. I internalized the book. I implemented the book religiously. And I turned the family business around. My dad had passed away at 25. When I was 25, I bought the remains of the book, worked it out. And I couldn't just, I couldn't leave the business. I couldn't quit because one, I owed the IRS and the IRS, they're with you forever to death do us part. Right. So I couldn't, I had to have some vehicle to pay these hundreds of thousands of

dollars back to them and it wouldn't be a job, right? And the second thing was, I couldn't bear to go tell my mom that I blew the family business that had supported us for 25 years in two years. I blew it. I couldn't go bare to tell her that. So I had two real motivations to get through it. And I did it and I got through it by implementing the systems in the book. And then I started buying broken companies. I started, a guy wanted to retire. So I bought him. I started putting the systems in. Yeah, but you monetized the first one. No, I put three together. That was my first deal.

Okay. So I bought a broken one. You know why? Because I'm a business turnaround expert because I fucked up my own business so bad and figured out how to get out of it. Now I can fix any. And so I had three of them at that time,

and then I sold those three in 97. But really that's how it came about. Now we have tightened up our systems, we walk in, we have our checklist, we buy a broken business. And listen, I'm noted for buying broken businesses, but let's face it, they're all pretty much broken. I mean there's the 3% that are really performing well and they don't touch them and they're doing well, but there's 97% of the time they're broken. They're not working well,

you know, they're headed for a crash or they're just plain bleeding. And so, you know, so we focus on that because we get the best value. When I bought Gettle, which Gettle at the time was a 75-year-old brand, it was kind of an iconic brand at one time. At one time, they were the largest residential HVAC contractor in the country. And, you know, they had fallen on hard times they were losing a quarter million a month oh three million bucks and they know they no one would buy it because they want to catch the falling knife right so i had some equity in the company that owned it

i said let me let me just give you the equity back and i'll take that they're like where do i sign wow and so i took the company and i i implemented took our systems and month one break even and we went on from there this year ghetto we started uh the year before i bought I bought it did 11 million in sales lost 3 million last year we did 101 million made made a lot yeah get that I mean really get that everybody listening to this really get that well we made nine figure profits yeah I this really get that. Well, we made nine-figure profits. Yeah, I mean, really get that. Ken has become the most avid student. Wait, wait, wait. Eight-figure profits, sorry.

Eight. Eight-figure. I was doing the math. And my book wasn't just smoke and mirrors. You understand? It was the exact opposite of smoke and mirrors. You understand it was the exact opposite of smoke and mirrors. Every book on the planet is smoke and mirrors. This book is anything but smoke and mirrors. This book got to the heart of what was missing in Ken's company. And the minute Ken got a taste

of that, and he got a taste of that as he read it. Now, hear me, I'm not promoting the book, guys. I'm 83. I'm beyond promoting the book, but I'm promoting your life. Do you hear me? I'm promoting your lives, every single one of you. When you awaken the entrepreneur within you, and you follow a process that is religiously, absolutely replicable in every single kind of commercial, residential, whatever kind of company

on the planet selling any kind of product or service on the planet, and we've done every one of them. When you understand that, that I can turn to Ken and I can say, Ken, you got the secret. It's in the book. Follow the book to the letter. And he's able to do that. Suddenly you understand why Ken being the student that Ken has been over all these years, doing it, doing it, doing it, creating a company that is just absolutely transformational on the face of it.

You begin to understand why we're so passionate about it. Why I can still be passionate at 83 going on 84, not just about Ken, but about the thousands upon thousands of guys like Tommy, who've literally taken this and begun to do it earnestly, as though their lives depended upon it, and they do, then you can understand why I'm so passionate about it. By the way, let me throw this one point. So I clearly know, like what I talk to,

I talk to and mentor lots of guys in the industry. And they come to my office. I'm certain that we see, I don't know, maybe a couple hundred contractors come through our offices every single year. And we share what we're doing and we share ideas. But I know when you're struggling. I know what it's like. I've lived it I felt it and so you know there's things that I had to do to discipline myself to implement that book like I had to take

drastic measures like I went I got a mirror and I put it on the outside wall as at my office door and and I made myself every time I left of the day, I'd have to look in the mirror at myself and say, did you improve the business today, or did you prolong the agony? Did you improve the business today, or did you prolong the agony? Because it is agony. And, you know, at first I prolonged the agony. I got the book.

I looked at some more of the book. I thought about it. I internalized. I left. And every day I kept score. And it was more prolonging the agony to begin. And then the improving the business came along and more and more and more till I was just every day my whole role was dedicated to

improving the business to improving the systems and so that's how I got through that because a lot of people take the book and they read the book but then they don't do the book with it they don't nobody there's very few people that read a book and do anything with it I They don't do the book with it. They don't nobody. There's very few people that read a book and do anything with it. I think, you know, it was on a TV show. They said the last one we did was KFC. And I said, Kentucky Fried Chicken. That's interesting.

They said they open up a new store every four hours. And I said, OK, what do I need to do to make A1 open up a new market every single month? And right now we're opening up in Boise, North Carolina. We're opening up. And you grow through acquisitions. I think that's the best way to grow. And that's what I'm going for eventually to find a broken business. One of the businesses I'm looking at isn't broken.

He said he does 25%. He did $4 million last year. I just talked to him today. So I'm in these guys' ear all the time going, man, you're 60 and a half years old. Hey, you don't have to buy a broken business i just there's a lot of them out there there's a lot a lot of them out there and you know when i first got started i didn't have any money and so the broken businesses were easier

to cut uh creative deals with than buying a real business that you're you're buying for multiple earnings and you know seven figure price tags right so i i i learned this crafty way of buying just out of necessity yeah but you understand also that kfc doesn't buy a broken business they just start they got it well they've got it they've got a space yeah they're going to put a business on. You understand? It's like this little machine they're putting on that machine. And what does it do? It sells and makes and... It's McDonald's.

McDonald's in the books. Right, it's KFC. Read all about McDonald's in the books. KFC, Kentucky Fried Chicken. Yeah. Kentucky Fried Chicken. This is how you do it. This is how you do it.

This is who we are. This is how you do it. This is how you do it. This is who we are. We're not anything but who we are. We're not this. We're not that. We're you do it. This is who we are. We're not anything but who we are We're not this we're not that we're not the other. This is who we are. It's the McDonald's model So, how do you create? 37,000 642 turnkey hamburger machines

Throughout the world you do it the right way one way this way no other way. This is how we do it McDonald's fries are not soggy fries you get it's in the book hey it's very clear though when you walk through tommy's business this is a e-myth built business wouldn't you say yeah oh yeah i already told him he's the e-myth garage door well yeah the deal is i i haven't been in town the last three months in and out of town mostly for business stuff but i'm not sitting there managing anybody calling asking them why no trucks are breaking down there's gps there's systems in place that we set a record two days ago we set a record in service we broke six figures in service which i was really proud of first time just in service not including door sales.

In a day? In a day, yeah. Wow. So one of the things I'm looking at is you go into a business, and you've gotten into more broken businesses than probably anybody, is everybody goes, where do I start? And I think, for me, I want to look at, is there an organizational chart? Is there any type of manuals or handbooks for what people are supposed to be doing and how do they win the game that's not where you start you

tell me this is interesting i want to hear about you start with a blank piece of paper in beginner's mind okay now hear me until you've built your franchise model now everybody's listening to think well i don't want to franchise i don't want to franchise. I don't want to franchise. What you got to understand is every single great company, whether that be Apple, whether it be Microsoft. General Motors, all of them, they're franchise models. Is a turnkey franchise model. Because if it ain't a turnkey franchise model, you can't grow it. You cannot grow it with any degree of certainty. So until you've created a turnkey system, a turnkey methodology, lead generation, lead conversion, client fulfillment, the three-legged stool of every great company, you can't possibly grow it with any certainty whatsoever that you're going to be able

to produce the result that you're setting out to produce. That's what Ken is able to do. You understand when Ken buys a broken business, he walks into that broken business knowing, absolutely knowing what he's going to end up producing in the next 60 days, 90 days. He's going to turn that company around into his company. You understand right now it's a blank piece of paper. He doesn't care what they do. He doesn't care how they do it because he's not going to go in and fiddle and faddle with whatever they think they're doing. That's how they got broken. He's going to go in, clean the slate, and start anew. And that anew will turn that company to 12 times results in a year. Think about that. Think of the miracle of that. So Ken's got his own little McDonald's franchise that Ken has built, perfected to the point where he's continually able to lay it down in a blank piece of paper, ripping away everything everybody else has done

to turn his little business into a money machine. And that's what he's able to do. You know what's funny? Here's what's funny. 100% of the time, every broken business that I have fixed and turned around, the old owner, through gossip or to my face tell me that i cheated them that that i underpaid them because look how good that business was that they had built and i always say

it wasn't that good when i before i showed up but that's that's human nature yeah yeah you bought that business and look what you made from that business and ken saying i stripped the sucker clean of all the garbage you had inside of it so i could create a pristine perfectly operating system that the people were proud to be a part of now, a new company completely. So when I say a blank piece of paper in a beginner's mind, you understand that's literally what Ken does. Ken isn't buying a company, he's buying a location. That's all he's doing. He's buying a location in a market he wishes to pursue and doing that in a way that has worked so stunningly well for them.

At least that's my version of it. Well, I will say yes for the most part. I recently bought two companies, one in Simi Valley and one in San Antonio that have good foundations and have good operators. When I look at it, there's just a few little tweaks that need to be done to get it really ginning and then they're plumbing companies so we'll add our air conditioning brand together that's where I'm going to get a lift on those and what I like about that that strategy is I'm coming in with big bases I'm coming in with big bases. I'm coming in with $12 million bases to start. I increase that base up to

18 immediately. And then I add my, you know, 18 to $20 million of air conditioning. Now I have a foothold in the market. Yeah. Got it. Yeah. Plus one of the things that I look for, I'm looking at seven businesses right now. And the guy that I talked to today said, I spent under 2% last year. I still did $4 million on marketing. So I said, he's making his phone ring because he's been there for 35 years. So there's goodwill there that says,

you're going to get 15 to 20 leads a day because you've got a great name. But I don't think he goes, well, one thing, I don't want my guys selling too much. And I go, what's too much selling if they need parts? I don't think he goes, well, one thing, I don't want my guys selling too much. And I go, what's too much selling if they need parts? I don't agree with that. Some people have this negative connotation. Sales are bad.

Don't do sales. And I'm like, that's because you live at your house. You work from your home. Your wife works for you. Your son does the stuff. Your daughter answers the phones. You don't have insurance. The business fails when you leave.

And you don't have a company. It's so hard to tell people that want to sell their business for 30 years later that all I want to buy is your phone number. Nothing else. You haven't built anything. You probably had to do this a lot. Is your business, I could pay you $10,000 for your phone number. Yeah, I learned a long time ago. I have all the strategies for acquisitions.

One day we should probably do one of these podcasts and talk specifics, the details of acquiring companies, home service. Acquisitions. Yeah, because, you know. Can you make a suggestion? Yeah. Yeah, let me make a suggestion. You don't do a podcast on it.

What I'm going to make the suggestion is you teach him how to do it. Because if you teach him what you know about acquisitions, you're going to blow his mind. You're going to blow his mind. You're going to do for him what I did for you. In just writing that book yeah the process you're going to teach him something he doesn't know i absolutely know that's true yeah and then you can do a podcast out of it after he does it and then he can report about how he's tripled his results in a period of only six weeks just because he sat down with ken goodrich and learned the secret underlying how you acquire companies well it's so funny because people say, why are you doing a podcast? Why do you share your secrets? What's the point? And I say, look, these people are calling me up saying I like you

and I want to sell to you because you're a good person. You're a good businessman. You treat your employees like family. And they say, I want my business that I work long and hard for to have a good home. So I think the podcast has given me a little bit better of an opportunity to reach out to business owners that might be failing. Well, same situation. My wife, it's infuriated her for our whole 30 years of marriage.

Why do you tell people all your secrets? Why do they come to the office? Why do they give them their forms? I'm like, well like well one they're probably never going to use them anyway they don't they read the book they don't do it but number two it's because one i want to network like it's a networking thing so that you know one day we may uh collaborate one day you might want to sell the business you know all those sorts of things and three I just like giving back but back to your other thing you said about just buying the phone number here's a little nugget for you I learned a long time ago

people wonder like well how do you get all the businesses to buy like I'd go in I'm always the ones everyone kind of wanted. I'm the ones who got them. And I don't, I certainly don't overpay. But it's because I give the guy across the table the respect he deserves because I have been in his seat. It's just that I got, I was able to evolve out of the seat he's in early on. But I know the agony that he's in and he's been through for 10, 15, 20 years. And so I don't disrespect him by saying anything negative about his business.

Of course. So when you say, like, for instance, I can only buy your phone number. What do you want to sell? Most of them say, I don't want to worry about it. One transaction, you take my dirty truck. Building the trucks. Whatever. Done.

We'll do it like that. Now, in my mind, I know day one, those dirty trucks are gone. We're moving out of that building. That inventory is in the trash. But I'm not telling him that. Because we all are kind of in this together, right? We're business people. We're all in this struggle.

And so honor and respect what people are going through. And if you do that, you'll have a much better connection to make the deals. Yep. It's a great piece of advice. And that's also true of the work we've done over these 40 years, 43 years to this date. The small business owners that come to us and the people who've read the e-myth, done the e-myth, the people we have coached in the process, and just multiples of businesses in 145 countries. So in a sense it's universal. This is not just something that you do in Phoenix or wherever, but these people come with pain and the pain is so absolutely clear in their faces. They're so obliterated by the impact of the decisions they've made. They don't feel stupid necessarily, they just feel like they're lost. They haven't a clue how

could it be so difficult to do what I set out to do and when we're able to show them the difference between what they have learned how to do and what they failed to learn how to do it just shocks them I mean it literally shocks them I know what shocked. I wasn't there when it happened, but to understand he was in tremendous pain. What to do? And then he reads a book that tells him exactly what to do, the first step, the second step, the third step. You understand seven steps, a process that anybody can apply to do what Ken has done, that you have done? Seven essential disciplines for building a company.

You know, when we were upstairs at my book club, we were reading your book, and we go and discuss what we thought about after, I think, the third chapter. We read it in four phases, and then we had a meeting about it Luke had his own company before and he sold to me Bruce had his own t-shirt company we had about four people there that had their own company and they said well why are you making us read this

book it seems like it's for an owner I said you guys are pretty much many owners in the company you own a division you know you're our they each owned a division but they said to me if i had this book when i was in business it would have been completely different because i just owned a job and i can't imagine so many people are in the same shoes i mean a lot of the listeners of the podcast they say you know where you got to listen to the book i listened to to it. I've read it. I've got every single thing of the different books that you put out. And I know you're coming out with a lot of new.

You're working on another book, aren't you? Oh, yeah. Yeah. What's that all about? Well, I'm working on a new book all the time. But the last book we published was Ken's book. Right. But that book is one of a series of books and those series of

books are what we call vertical books so hold up that book that's the E-Myth HVAC contractor in which Ken is the co-author I'm the author in that book I'm the generalist Ken is the specialist so I write In that book, I'm the generalist. Ken is the specialist. So I write in that book a chapter on marketing. And then Ken writes a book on the very same chapter on the very same subject following my chapter. But I'm the generalist. Right. And how I applied what he said. How he applied what I said.

Your tactical, his strategy. You got it. You got it. So understand what happens then with these books, like the book you're going to do. Yeah. What happens with these books is we are now telling a profound story from every single vertical market on the planet.

And there are 322 vertical markets we're going to publish a book for. That means we're going to have 322 co-authors who've actually done the E-Myth in exactly the way I've described it in all my other books to build a practice that works absolutely every single time that they can then replicate. So you understand what Ken did is he studied my book, The E-Myth Revisited. We held that up and then did that book, which enabled him to become the co-author, the one HVAC contractor in the world to write that vertical book with me. Hey, so where does my vertical rank in your vertical list? Number one. Where does it rank? Now, what do you mean by where does it rank? Well, from your purview, from your view as being the most pure e-myth. Well, let me say that I'm not going to give you a ranking. I'm not going to give you a ranking.

Because if I gave you a ranking and you want to be number one, if I gave you that ranking, then what does my e-myth real estate agent say? And what does my e-myth real estate investor say? And what does my e-myth, et cetera, and so forth? So I'm not going to give you a ranking but let me tell you what my true ranking is of you okay you're the best student i've ever had let me put it that way you're the best student i've ever had and you're the best student i've

ever had because i never met you until after you've done what you've done with the E-Myth. And you told me stories about what you've done with the E-Myth in the application of it, in the creation of your alcohol practice. That's the first operating system that you developed and then you applied it and applied it and applied it but you did it and you use this word religiously so understand you did it religiously lots of people do it but not religiously and when you told me I've read your book 39 times and you didn't say 39 freaking times. You said 39 times. Nobody has ever said that to me before. So understand to me what that says is you have been an absolutely faithful and religious

student to the mindset and capability that I've written about and proven so well again and again and again and again. Or I have a reading retention problem. No, but thank you very much. I really appreciate that. It's an honor to hear that. But hear me. You made light of it. Don't make light of it. I'm not. Okay, please don't make light of it. No, I appreciate it. Because I don't. And when I say it, I say it with the deepest sincerity. And I'm saying to everyone out there, if you had just a bit of Ken's tenacity and perseverance and ability to truly see the genius in that book, not in me, in that book, in that process, that you wouldn't understand

just like Tommy Mello does, that your whole world depends upon it. Your entire world depends upon it. I'm talking about your life depends upon it. You get that? Yeah. So one of the things, and I'm really loud, so that's good. I love the story in the book that there's this guy who goes to a hotel. And he wakes up and it's the coffee he wants. He's got the Wall Street Journal. Everything's perfect. There's roses in there. He loves white roses, whatever.

And he goes to the manager and he says, how did you guys do this? And he said well you filled out a questionnaire we've got this book and it's a system everything's systems and i just when you really think mcdonald's i love mcdonald's when i'm in china i've been to brazil i've been to canada i've been to all these countries and i love mcdonald's because i know what i'm gonna get i don't love mcdonald's but I just know it's, this is what a burger, this is a Big Mac. And the fries, I know that the fries are just salted a certain way. And what I love about it is, apply that to my business.

Now, it's not easy in the home service business, because we've got a lot of other factors. But in your book, you said, the world is a treasure hunt for an entrepreneur. And now I feel like it's a treasure hunt. Now I'm like, where are we going? How are we going to get to Canada? Australia's looking good.

I mean, I'm going to be the largest, by far the largest company in North America. It's not even a question. It's happening right now. We're going in, we're going to be in 13 states within the next two months. And I'm just going to blow it up. I talked to a company that's bigger than me.

And I said, I want to buy your company. I told him that today. He said, I want to sell you certain markets. That's what he said. And we go and we plug and play now. The one thing that I think most people leave out is they build these great systems, but they don't build systems to find great people. So we've got a system to find, train, orient, and retain great people. And that's the hardest part. That's what you hear these days. I could use three employees right now i got more business than i can handle the best economy that i've ever lived in in the last 60 years it's the best economy so people are saying how do we get great people and i'd love to hear your guys's take on that because people are the hardest thing but i say

it's my process and my system to get the people i'm not not lucky. I'm always networking. People say I always be closing. I say I always be recruiting. So what do you think? Well let me respond to the question. Sure. And it's the system stupid. So I understand it's the system stupid. And so you're inviting people to come to your company to talk about an opportunity that they don't have currently. Everybody wants an opportunity. Everybody believes they Everybody wants an opportunity. Everybody believes they're selling an opportunity, except most companies don't believe they are. They're selling a job. You're not selling a job. You're selling an opportunity. What's the opportunity? Let me tell you the story of my company. Let me tell you how I started my company. Let me tell

you what I learned as I started my company. Let me tell you why that's important. So understand every single recruitment process starts with a story. A story. But a story that has heart. Because everybody has bullshit stories. But not real stories. So every single person I ever hired from the very first day one, I told a story. Hi, I'm Michael E Gerber. You don't know me. In fact, most people don't,

but the fact of the matter, you will, if you survive this first 30 minutes. In the first 30 minutes, I'm going to tell you the story of my life and why it's the most important story you've ever heard in your life. And by the end of this 30 minutes, you're going to decide whether or not you want to go to the next step in the process. I'm not going to decide that for you, but in truth, you're going to decide that. And if you decide, yes, you want to go to the next step in the process, then you're going to tell me your story.

And please tell me the story in the same way I told you mine. Because if you don't, you won't make it to the third step in the process. And it's like that. You follow me? Yeah. So imagine doing that. You can imagine doing that. Can you imagine Ken doing that. You can imagine doing that. Can you imagine Ken doing that? But can you imagine

Ken now turning to his ex-colonel from the Air Force or the Army who's leading his company, and that colonel now is telling the story of how he came to meet Ken and why it was so different for him than other places he's gone in this motley place called America, where there is no discipline, where there are no warriors, where most people haven't a clue what it means to come out of the military looking for the second stage of your life that has meaning. So you understand how rich the stories can be. And they're not fabricated stories that's really the story you understand ken tells the story about what he just did he tells it here and people get fascinated by it because ken's a real guy and you're a real guy and you're saying this is what

i'm going to do and it's bigger than. But you understand it's because your passion is bigger of working with somebody who's bigger than life holy moly what an extraordinary thing to understand the influence you have the influence you have the influence i have yeah to become a thought leader among people who have never been inspired to go beyond the ordinary, doing it, doing it, doing it, doing it, that is just deadening, deadening, deadening to life source that in fact every single one of us are looking for. Like meaning, you know, you're 83 and you're still kicking butt at this stuff. so you've got all these books out you're what'd you say 347 you're putting out so you're doing all these books co-auth you're the main author getting other co-authors you're talking on stage a lot tomorrow you're talking on stage

um you're putting out new books i mean what what's the obviously the plan is to share the message with everybody let me tell you what it is yeah okay let me tell you the heart of it people ask me so why do you do this well I said why I did this when I started my first company that was the Michael Thomas Corporation in 19 freaking 77 hear me 1977 that's a long freaking time ago. When I started that company, Tom and I sat down and it took us maybe three months. We had to answer the question, why are we doing this? What are we really intending to do here? So it became very clear to me four things. I had a dream, I had a vision, I had a purpose, and I had a mission. My dream then in 1977, literally word for word, was to transform the state of small business

worldwide. That's why we started the Michael Thomas Corporation, to transform the state of small business worldwide. Now, if you ask me, what does that look like? What does that feel like? I could tell you all of that, but we didn't need all of that because the great result we were there to produce was to transform the state of small business worldwide. I had a vision. And my vision then in 1977 was to invent the McDonald's of small business consulting services. The McDonald's of small business consulting services, which means what? Turnkey. I had a purpose in 1977. My purpose was that every single small business owner who was attracted to what we do, our paradigm, could become as successful as a McDonald's franchisee or even a McDonald's franchisor. And to end that process, I had a mission. Mission. And my mission was to invent the business development system that was critical for me to realize my dream, my vision, and my purpose.

You get that? Yes. The four personalities within an entrepreneur. The dreamer, the thinker, the storyteller, the leader. The dreamer, the thinker, the storyteller, the leader. The dreamer, the thinker, the storyteller, the leader. Because if any entrepreneur is absent any one of those roles, they're lost. So Ken is a dreamer, a thinker, a storyteller, and a leader. You're a dreamer, a thinker, a storyteller, and a leader. And you've got to be explicit about what that is to transform the state of

garage doors everywhere in the world. Are you shitting me? How do you do that? By having a dream, a vision, a purpose, and a mission. The McDonald's of. Why the McDonald's of? Because it's the most successful small business in the world. Today, all those years later, and the sucker was 52 years old, Ray Kroc, when he started it. When he started McDonald's, he was 52. Hey, tell them the one interesting thing you said to me. One of the interesting things you said to me in the past. You talk about the movie The Founder. And everybody who has a business should watch the

founder i love the final where he says they'll stick a hose in your mouth when you're drowning but go ahead so okay and and and look at the founder for what look at it from the business building you're talking about the chalk the movie Chalk. But you told me one time, what do you believe the very best part of that movie was? And then you told me. Do you remember this conversation? No, but I know exactly what I would say today if you asked me. Go ahead. But I said the guy who made that movie actually hated Ray Kroc.

The guy who created the founder of the movie hated Ray Kroc. He demeaned Ray Kroc. He diminished Ray Kroc. He made Ray Kroc a greedy guy who took this great opportunity these McDonald brothers had, and then he seduced them into losing their business, exactly the opposite of what he did at 52 years of age. He created a stunning, stunning system. The best part of that movie, however,

was when the McDonald brothers took out a whole, what is it, a basketball court. Yeah, that's what they chalked. And they chalked it. Yes, they chalked out that sucker to the point that you could see every piece moving in every direction connected in a universal system. That universal system chalked out, chalked out, you understand, is something no business owner has ever done. No

business owner ever thought of doing. And they watch that movie and they don't even understand it you follow me yeah ray crock was a genius ray crock at 52 freaking years old he walked over and saw that mcdonald's hamburger stand and he said my god and they've only got a couple of locations yeah there are tens of thousands of these waiting to be built. And that's what he did. Absolutely amazing. Well, you did the same thing. Like your trucks, like you have the best home service trucks that I've ever seen. I've seen thousands of them, right?

But the way, tell us how you put that together. Because this little place is where the screws go. This little place is where these rods go. And this is, everything fits. It is a, that is a rolling garage door it's a machine machine and everybody that looks at my truck so so i said i said originally i'm sick of going to wrap companies so i bought my own wrap company i got my own printer my own plotter my own laminator and now we've got skilled guys doing it so i buy all these trucks

from enterprise they're all the same there's not one different and then we weld the container in the back we weld these we get them powder coated everything's the same everything's got a spot and not the trucks there's a light there's a uh there's a thing so you can charge your batteries there's the ipad holder and the thing is is i can go in to they're rolling chassis of a garage door company and the smartest thing i did was last year i went to my manufacturer and i said i don't want to be in the inventory business anymore i want you to carry all the inventory from all my different manufacturers you've got these huge warehouses you're gonna buy it you're gonna sell it back to me and they said okay i had to go to three of them.

And they finally said, okay, so I could go into any city with no warehouses, with no inventory, except for the vans. And I go pick them up. And they get auto stuff from Service Titan. And do you know how great it is to be able to go to any city? Well, there's about 180 locations I could go to. The largest distribution center of residential garage doors in the world and you know you might think garage doors but i

say it's 40 of your home's curb appeal it's the smile of your home it's the best and remodel magazine is the number one return on investment and that's what i always tell my guys is this is an investment this is what then when i talk into a homeowner this is what you use every day you don't use your front door you use your garage this is where you park your car so i'm pretty passionate about garage doors i love garage doors and i just see this huge void the garage industry is where the hvac was in 1980 and that's what's so great there's all these guys out there that are trying to do it but they don't have a system at all they don don't have any. And they're so content. But did you hear what you said? Even more, did you feel what you said?

Yeah, of course you do. But you feel what you said. Nobody loves garage doors more than I do, is what you're saying. And I'm saying nobody loved McDonald's hamburger more than he did. You understand? I mean, they fall in love with what they do. They're passionate about what they do. They see a miracle in a garage door. They see a movie in a garage door and so forth and so forth and so forth.

Without that, what's the miracle? Yeah. Follow me. Let me jump in on that point. So we talked about that, you know, your passion for garage doors right so recently with the last year or so i came in contact with the new president of a company that i had sold a number of businesses to uh fix some companies for for a fee. I was involved with them for a number of years, maybe eight years of my total career. But at first, that was a company that I was selling most of my businesses to. I'm not going to name the name.

And so I meet the new president. The new president is a nice guy, but he was very credentialed. He worked for, I think he worked for GE and he had some, an Ivy League degree and blah, blah, blah. And he was, you know, very polished guy. And so I started chatting with him. I said, Hey, listen, I hope you don't mind this, but let me throw this at you. And maybe because I have a passion for the company because I spent a lot of time there. You know, I was in the middle of it. And this is something that I was always passionate, but I couldn't get it there because I didn't have the role or maybe I wasn't big enough. But you know why that company is not a $3 billion company and completely owns the space?

And he says, why? And I said, because there's no one at the top that is passionate about the work you do. There's no one at the top that knows it and lives in it and understands the intricacies of that business and are creating it like a Steve Jobs who knew the details of how this machine worked. I said, all the time that I've been there, ever since it's been there, everyone at the top has the mindset of let's get some lipstick. Let's put some lipsticks up. Let's put some lipstick on this pig and sell it. And that's the mindset of the company, which translates into the culture of the company, right? Everything's based on that. There's none of this passion. There's no story to the business.

Now, he didn't get it or he took offense to it. And he said, well, maybe I should just quit then. I mean, that was his comeback. That's a different version of up yours. Yeah, yeah. Well, maybe you should. Because I clearly know now, we go on this journey. I've clearly got my mind and I've accomplished everything I put in my mind.

I'm going to pull another half a billion dollars off this company. And I clearly see now how to get it to a billion dollar company. And it's really about staying back. Don't get caught up in the fray. Don't get caught up in the noise every single day. You stay back, and you're a business builder. You're a business builder. Well, let me.

Yeah, go ahead. Yeah, yeah, yeah, absolutely. But you understand you've already done it. In short, you've already done that sweat equity thing that is so critical to investing yourself in the detail of every single part and parcel of that small company. So you've taken that small company and scaled it. Now everybody's using that language. You understand, but you've done it literally. You've literally replicated it successfully to the point where you can replicate it infinitely. So you can pick a number and you can get there. It's that simple. It's almost mechanics.

You can pick the market, do exactly what you do, and replicate that, and then leave it behind, and leave it on to another, and another, and another. And that, on the calendar, you can predict exactly what's going to happen.

One thing to that point. Sorry we're going over, but listen. No, no, this is going forever. So my GM, my GM here in Phoenix, in 2000, we were doing our budget, say, September 2017 for 2018, or 2018 for 2019 right and he puts the budget together and he puts some menial growth rate on it you know like 10 or 15 yeah 10 15 or 10 but like you know I'm not even interested if it's not over 40 but he puts it together and you know he has all his reasons why and blah blah blah. I said listen I'm not accepting this. Here's what I want you to do. I want you to go back and I want you to reverse engineer the business and say if I wanted

to do 50 million from 25 I wanted to do 50 million in 2020. What are all the elements I need? What's the org chart look like? How many trucks do I need? How many calls do I need? What do I need technicians? What's my recruiting plan? What's my retention plan? What's my marketing plan? You know, all the stuff, right? You put that together and you come back and you show me how you're going to do $50 million in 2020. So he's a little puzzled, but he does it. And he comes back, he comes back, he's so excited, like, I figured it out. Like, I know I need this many trucks, this many calls, this many added people, this many this.

He figured it out. I said, okay, that's your goal. So now, you know, he blazed past 2019. He knocked it out of the park. And now he's on pace for this year. But he's clear. I'm doing 50 million. I'm doubling the size of the business in 24 months. And that's what I'm doing 50 million i'm doubling the size of the business in 24 months and that's what i'm

doing in january he was 105 percent up year over year in january february he's pacing 100 percent up year over year you know why because he didn't look at it like well you know i'm gonna i'm gonna grow 10 percent this year. I said, reverse engineer the business. Say, what would we need to get there? But do you realize how significant that is? You stole my thunder because I said, I need to get to a billion. I need 2,000 technicians.

How do I get to 2,000 technicians? 50 a month is 600 a year times three gives me 1,800. That gives me just under a billion dollars. I got that number. Every manager out there will tell you how many technicians we need to get to a billion. A year ago, they would have said, you're freaking nuts. There's no way a garage company is going to do a billion dollars. I said, so how do we get, we've got a full-time recruiter. We've got a recruiter assistant. We've got two full-time trainers. And I i said we got to start marketing for employees i'll get the jobs we need the people to run the jobs so 2 000 technicians with 15 jobs a week gets us to a billion wow i like that it's nice and clean it's i mean and and when you when you

break it down to the ridiculous you can get it done right you can see it you hear me? This, this client who, a beloved client, he's done everything I've said until he stopped. Hear me? Did everything I said until he stopped. And the last conversation we had, I said, so what is your plan for next year? He said, well, we're going to grow by 10%. And I said what do you mean by 10 he said i'm really happy where we are now hear me i'm really happy where we are because where he is is so much bigger than where he was and yet he doesn't then see the possibility all of the lives that guy could have a

profound impact, the families that guy could have a profound impact on the organizations that you understand he's not called you're called and you're called

but you even don't realize how important it is so understand you're called. But you even don't realize how important it is. So understand you're called, but you don't really understand how important it is. You don't understand the strategic significance of what you're doing. Because when you do what you're doing, when you do what you're doing and teaching that general manager to do, you're suddenly transforming the reality of ordinary lives in a way they don't even appreciate. And in the process of doing that, you're truly transforming the state of economic development worldwide. Hear me, you are the core of what my dream, vision, purpose, and mission are.

To transform the state of economic development worldwide. By transforming the state of entrepreneurial development worldwide. By transforming the state of small business development worldwide. And in the process of doing that, the contribution you're making everywhere. Understand, everywhere. And that's the story. And I'll stick with it. I love it.

Because it's doing it, doing it, doing it, doing it. Even while you're sitting here with me speaking, it's having an impact in every community you're in, in ways you just don't appreciate. I'm here to tell you I appreciate it because it's significant. I love that. Yep.

Great job. Thank you. That's great. You know, I just want to end with one thing. I had a clear picture of what this company was going to be. I had a clear picture in my mind. I said I wanted to grow, and I knew I wanted to be the largest in North America.

Now I think in all the world. And I acted like the company I wanted to be. And that's what you talk about in the book. It's funny because I have a clear picture in the maturity phase. Act like the company you want to be. And begin to learn the vision of who you're going to become. And that's really what the end in sight of really what we're all preaching here. So thank you so much for being here.

And I had a great time. That was a great way to end it. I want to say, before you end it. Okay, go ahead. Before you end it, before you end it, I want you to remember this. That's your story. So understand when they ask you to speak at the chamber,

when they ask you to speak at the chamber, when they ask you to speak at the University of Texas, when they ask you to speak here and there, and you should be in fact doing that. When they ask you to speak that, you tell this story. Because this story is transforming the state of economic development right here where I live, every single place I am and the places I'm not, because I'm essentially talking about the American dream. That's what makes our country the most successful country ever to have lived and been born on this planet. Think about that.

At the heart of it is the heart of an entrepreneur, and at the heart of that is God. So hear me, that's what we've been told from the very beginning. At the center of this is my passion for life in a way that nobody, nobody can take away from me. And that's what we intend to bring every place we go. And that's what you do. And that's what you do. And I'm so proud to be a part of it. I love that. This is great. I'm so glad you guys came today. Thank you. I really appreciate it. Thank you. Hey, I just wanted to take a quick minute and thank you for listening to the podcast. You know, most people don't understand this, but the way that the podcast

has grown is when people subscribe and they leave a review. So if you would please, please, please, Wyatt's top of mind, take a quick minute to subscribe and leave a quick review. It'll help me out so much. If you just took a little bit of time right now, I can't tell you enough how much I appreciate the listeners and the feedback. And also when you subscribe, what I'm going to do is let you know the next guest coming on the podcast. And I'll let you email me anything you want me to ask that next person coming on. All the pros I have on here. I want your feedback. I want you to subscribe so you can start giving me the questions you want me to ask and help us grow together. Also,

I'm giving away my book for free now. All you got to do is go to homeservicemillionaire.com forward slash podcast. You got to cover the shipping and handling, but I'm giving the material out for free. It's 200 pages. It's a hardcover book. Homeservicemillionaire.com I appreciate each and every one of the listeners, and thank you for making this Home Service Expert podcast a success. I hope you're having a great day, and thanks again.