Danielle Nyes (3:00)

Thank you. L. Thanks for having me Danielle.

Phil (3:03)

It was a seminar about buying businesses.

Will Smith (3:06)

That you attended that not only open.

Phil (3:09)

Your eyes to this path, but convinced you right there to pursue it. It was in fact the very same seminar that so impacted another guest.

Will Smith (3:18)

Ken SEO and the hosts of this.

Phil (3:21)

Seminar themselves were guests just the other week.

Will Smith (3:24)

Jake for Faro and Kyle Boyden. So a very action oriented group of you up there in Seattle. We're looking forward to hearing your story. Danielle, let's start off with some background on you, please.

Danielle Nyes (3:38)

Yeah, thanks, Will. Background on me is essentially grew up in the family business. My parents started it over 40 years ago. It's still a successful business today in the Everett, Washington market. And learned entrepreneurship, learns hard work, learned grit, grind. Working in the family business since I was a baby. I'm sure they were carrying me around. I just remember on the weekends, you know, we would pack picnics and we would go out and look at parking lots. The family business was asphalt paving. So just grew up in that environment and as of recently, in the last two years, left the family business. And that's where my story begins. That's why I'm here.

Will Smith (4:24)

As I recall, you were working in the family business as an adult now. Not. Not in diapers, but as an adult. And that may have continued, but didn't. So what happened there with that pivot?

Danielle Nyes (4:38)

Yeah, I think that I had reached my full potential and my ceiling that I could possibly go to in the family business. And I had different vision than my dad had for kind of where the business was going. So I had to make a choice. I either accept and tolerate the current situation or I do what I wanted to pursue and where I really wanted to be in my career, in my life. And that was essentially really having more ownership and having more say and living by my standards. So when, you know, things hit the fan, I had a choice to make. And so my sign was the masterclass that I saw Jake for Faro post on Facebook. And I got intrigued. The light bulb went off and I, I pivoted once I figured out that there was a different path.

Will Smith (5:38)

So you were looking to get out of the family business and you were looking for a path. It might have been getting another W2. It might have been core in a small business, it might have been corporate, it might have been real estate. So you were you kind of considering all these options and then of course, buying. Buying a business came across the radar. Was it. Was that kind of your state of mind at the time?

Danielle Nyes (6:02)

Yeah, my state of mind was actually really messy during this time. I was, I was confused, I was lost. I definitely put a lot of my identity into the family business. I thought for sure that that would kind of be the path that I would take over, that it would, you know, cross into generations, which really excited me. But unfortunately, that wasn't. Wasn't the destiny. And so I Actually, we. There was a falling out, so I left the family business and I was unemployed for three, three or four weeks. Trying to find another W2 in the meantime and just kind of reset my mindset. And I did find another W2. Knowing that, you know, this was not knowing that, it felt like I was settling. But that's okay. I still was passionate about working in small businesses. And I got this job opportunity through a friend who, you know, knew my work ethic. He'd worked with me, he'd done jobs with us through the family business. He owned a website company. So we kind of exchanged business. Like we worked business to business together. And so I took the offer. I just said, sure, why not? You know, it's familiar and feels comfortable and I'll kind of just work through this, pay my bills and figure out kind of where I'm gonna head. But while I was working that W2, that's when I saw the masterclass with Jake and I was like, I'm gonna go to this and see what this is all about. So the journey began while I was working at W2 full time.

Will Smith (7:36)

Okay, well, but it does sound like your orientation was to small business. So whatever, whatever the future had in store, it was probably going to be not corporate, but small business. So you see, you go to this seminar. What so grabbed you about the concept of buying a business? Was it just the powers of persuasion by Kyle and Jake, or was it. Or was it something else?

Danielle Nyes (7:57)

Well, have you ever spoken to Kyle?

Will Smith (8:01)

He is a compelling and energetic person.

Danielle Nyes (8:05)

Oh, he's so great. Yeah, I think it was just ultimately when I. I had no clue initially that you could buy a business, I didn't even know that that existed. So I was just intrigued initially and I just thought, you can buy a business. I don't know if I'm qualified for this. This is crazy. But I'm gonna check into it. And when they presented kind of what it takes to buy a business, I was like, none of this seems hard to me. None of this seems like I need to learn this. I already understood all of this based on being in the family business for the last five years. You know, I knew how to read a profit and loss statement. I knew how to work through QuickBooks and really analyze the numbers and know what the numbers mean. And obviously had management and operational experience and marketing and sales. So I had all the business experience experience. My, My struggle was if I'm. I really wanted to be a business owner and I'm just like. But I don't really have Like a technician or an artist skill set to, like, go out there and provide to the marketplace. I just, I identify as a manager and I'm like, how do you start a business, like, with. With those kinds of skill sets? So this was like the light bulb went off for me where I'm like, this is a good opportunity for someone like me who doesn't necessarily have, you know, that technician skill set for the marketplace. So it just made sense for me automatically. And I was like, immediately I just knew, I can do this.

Will Smith (9:32)

Yeah. Yeah. No. So you had thought that you had to be, you know, that most small businesses grew up around a technician doing the work, and then they build a crew and more around themselves, which, by the way, is the standard pattern. And if you don't have that as a particular skill to build a team around yourself, you know, selling that service, you thought you. There was nothing for you to do. And then. And then along comes this opportunity and you realize that that ownership and management and growth of a business itself is a skill and in fact, one you were well suited to.

Danielle Nyes (10:08)

Yes. Yep.

Will Smith (10:10)

And one thing that can be another pattern on this podcast, Danielle, is that a lot of people interested in buying a business come from corporate experiences and the. And there's a big difference in culture between corporate and small business and small businesses. You know, all these cliches that it's messy, that it's more emotional, that it. There can be. It's less stable, can be higher risk, the swings of a business can be more dramatic from year to year. But you were right at home in this. This is the world you knew. So there was really. Do even. Do you even relate to what I'm talking about? Or you're like, no, that's just how. That's just the water I swim in.

Danielle Nyes (10:49)

Anyway, I've worked a little bit in corporate. Initially when I lived in Idaho, my first job was like in a call center for AT&T. And then I worked for T Mobile under John Ledger, was the CEO back then. And it was actually a great experience. And I learned a lot about culture and leadership and just that overall environment. But you're just a number in those settings. And so family business really felt more intimate, more personal, more growth. So, yeah, corporate was very minimal. And in my experience.

Will Smith (11:24)

Great. And you. Did you have any reservations about stepping into a small business and being everybody's new boss and owner?

Danielle Nyes (11:33)

Oh, totally. I mean, all the limiting beliefs and doubts and all those things kicked in. You know, I told myself over and over, like, who do I think I am? To go out and be in this world, buying a business when I've been so trapped to, you know, this little corner or this little box that I was put in, working in the family business for so long. And like I said, it was an identity shift for me. I still kind of feel like I'm an employee to this business that I own. I still have a hard time saying that I'm the owner, saying that I'm the boss. Some of that language just, in my opinion, just kind of feels icky. But that could just be from the PTSD from the work environments I've been in and the poor leadership that, you know, I've experienced. But that's really been my motivation behind, you know, making a difference and going into a business and doing culture differently.

Will Smith (12:32)

Kyle ended up being, and maybe Jake as well, ended up being coaches to you through this process. Did you express your, your sense of, you know, you're, you're lacking confidence that you just shared with us to Kyle and Jake and what did they say in response?

Danielle Nyes (12:53)

No, I never actually let them know how I was feeling internally in this whole process. I needed them to know. I didn't, Kyle didn't have a clue that, you know, after I jumped off the call with him, I was, you know, wanting to turn around and just tell him, this is crazy, I can't do this. Like there's no way I can continue or. No. I think Kyle ultimately felt that I was just pretty much a go getter. Fearless. I'm really good at facing it till I make it. That's been like one of my biggest mottos and almost too good at that. I kind of live by, like Layla Hermosi says, a lot, like, f your mood, follow the plan. And so that's just kind of been like, you know, my feelings are, are there, but essentially I just dive head in and figure it out. Yeah.

Will Smith (13:46)

Talk to us a little bit about Kyle being a coach. What's it like to work with a coach through this process, which is a bit of an unusual format. There's a little of that that I'm aware of, but oftentimes people are getting their education through. There's kind of courses, course style stuff, boot camps and so on. There's the pods, there's the books. But having kind of a, a one on one coaching arrangement through this process is, is. It is not a common format, although it seems like it, it makes a lot of sense. So tell us what that was like.

Danielle Nyes (14:19)

I couldn't have asked for like a better guardian or a better angel. Like, just a gift from the universe quote, quite honestly, to guide me through this process. Kyle was, for one, hilarious. Like, he made this process feel so fun. He was so smooth and just so efficient when it came to jumping on these calls with me, talking to business owners. And truly, I could just kind of mirror him and, you know, steal his homework and copy and paste that into my own calls. When he likes. Said to me, he's like, okay, you got this, like, start. Start taking the calls yourself, you know, and then just let me know how it's going.

Phil (15:02)

So let me ask you, Daniel, what was the.

Will Smith (15:05)

What was the content of what you were like. What. What was he. What was the, like, service that he was providing? So. So getting on calls with you to owners, but what else? Give us a sense of the package.

Danielle Nyes (15:17)

Yeah, so he was jumping on calls with me just to kind of partner up with me. And we were basically, you know, letting owners know that, you know, hey, we're in this together. Kyle's know, a partner and, you know, just introducing ourselves and essentially just kind of being a mirror for me to kind of soak in so I can kind of be a sponge. And then really helping me with just 247 access to questions when it came to anything that I noticed, like, the whole territory was unknown for me. So ultimately, I was paying him for certainty. I'm really not. My. My risk tolerance is actually extremely low. So he provided that certainty for me. And, you know, it helped me analyze. Even though I could analyze a profit and loss statement, for some reason, I just felt better with being like, hey, are my thoughts valid in this? And Kyle would be like, yeah, totally. So ultimately he was, you know, just kind of like a. A guide in the whole process, whatever questions I needed.

Will Smith (16:18)

And was he sourcing deals for you?

Danielle Nyes (16:20)

No. Oh, no. He. They provided me lists and I did some email blasts. Wasn't really the direction I wanted to head. Ultimately, kind of after going through that experience and getting some hits from business owners calling me or replying back to me via email, I had much more success going on Biz by Sell and. Or even I'm just getting some brokers emails and emailing brokers and getting their SIM packages, I think is what they call them, and just reviewing those types of packages. So that's. Ultimately the business I bought was through a broker.

Will Smith (16:56)

Okay, so he kind of pointed you in a direction, gave you a list, and then. But you did the sourcing yourself and ultimately relationships with brokers and Biz by Sell was the best channel for you.

Danielle Nyes (17:07)

Yes.

Phil (17:10)

What do the following Acquiring Minds guests all have in common. Doug Johns, Morley Desai, Tim Erickson, Chirag Shah, Shane Ursam. They all went through the Acquisition Lab, the accelerator in community for people serious.

Will Smith (17:26)

About buying a business.

Phil (17:28)

But they represent just a sliver of.

Will Smith (17:30)

The Lab's success stories.

Phil (17:32)

The number of deals across the Lab's cohorts now stands at over 120, with over $300 million in aggregate transaction value. The Acquisition Lab was founded by Walker Deibel, author of Buy Then Build, the book that introduced so many of you to the very idea of buying a business. The Lab offers a month long, intensive, almost daily Q and A sessions with advisors, live deal reviews with Walker, Deal team introductions and an active community of serious searchers. Check out acquisitionlab.com link in the notes or email the Lab's co founder, Chelsea Wood. Chelsea buy, then build.com.

Will Smith (18:16)

Anything more to say about the search process? For example, can you tell us what you thought your size range was in terms of what you could afford to buy, size of business, SDE, revenue, etc.

Danielle Nyes (18:29)

Yeah. So Kyle and Jake. Jake was involved initially kind of in the beginning of the whole search process and that was kind of what they first set me up with. They're like, what's your buy box? And so we put that together and ultimately I wanted something that I could, I could fund a down payment with up to $200,000. That was the cash that we had available to buy a business with. So I knew that we were looking at a business that was probably listed, you know, within the 1 to 2 million dollar price range, bringing in anywhere from 400 to 500,000. Net profit was like my bare, my bare minimum. So, and then industry wise I was just looking for service based companies. That's where I felt comfortable. That's where I've been with family business is construction, remodeling, asphalt paving. So I talked to a few asphalt paving companies that were competitors of my dad's company and it's quite interesting and you know, but didn't really want to go into competition with the family business and quite frankly wanted to keep my boundaries from that anyways, so just anything service, I mean I looked at H Vac, plumbing, those kinds of things, but landed on the current business that I'm in for staging.

Will Smith (19:45)

Danielle, before we leave asphalt, can you just give us a quick one minute on paving? Because it's actually a business that people in our community look at. It's one of those you, you kind of don't realize, don't even think about it as a type of business and then realize of course, that it's everywhere, there's this whole world, etc. What are, what are the, the strengths of the paving business and what are the weaknesses?

Danielle Nyes (20:11)

Well, weaknesses. We can start there first. It's a tough, a tough industry. I think that finding pavers and, and creating culture and I don't know what you call it, obedience or whatever within, you know, the pavers that are coming to you. It's that we've, there's, there's mindset difficulties. We actually had a really good paving crew at my dad's company. They were, they were great to work with, but the training is really difficult. The environment is really difficult. It's hot summers, it's hot paving, it's long hours. So just labor in general. I think that's pretty common pattern across, you know, the, the trade industries is finding the people that understand how to run those operations and you know, replacing yourself as the business owner when you come in and, and you understand that industry and you, you're the technician and you're the artist to the paving. You know, how do you get out of that training wheel trap? That's essentially what I observed constantly in the business. And so those are weaknesses. It's really not a hard weakness to have. I would say it, the business is still here and it's been around for 40 plus years. You just, you got to be in the business of recruiting and talent and keeping your people and training strengths. It's very profitable if you know how to bid and you know how to job cost and you're methodical within your sales and marketing departments and processes and your, you know, strategic with your accounting. And I know asphalt paving companies in the industry out here that are, their overhead is just insane and they're just not cutting a profit. And you know, they go, it's, it's very capital intensive. You got to buy your trucks, you got to have a yard, you got to have, you know, all the things that go along with it at trailers. And so yeah, it's very expensive. Breakdowns happen. You know, we've, we blew some engines that cost us 50, $60,000. So it's all, and it's just the fires that can happen constantly. You know, it's like your truck blows up and all of a sudden you're shut down on the job and there's like, you know, five hours of cutting into your profit. So it's, it's a, it's just a, what would you call it? Just intense. It can feel intense during the summertimes.

Will Smith (22:57)

You know, Danielle, I'm. I'm. When I was saying earlier that a lot of people come to this world from, like, a corporate environment and how small business can feel so different, I think what you like, the picture you just painted actually captures exactly what I'm talking about. That, like, the fire putting out of small business is distinct to small business and the intensity of it. But as we've already said, like, you're. You were at home in that environment. Was there any part of you that, like, I guess you were willing to look at asphalt and then decided not to because you. It was. It was too close to home. But so. So. But you've answered the question that, like, you were. You were perfectly fine looking at a business that would have that type of intensity, that. That was something you were at home in.

Danielle Nyes (23:41)

Yeah, I love intensity. Um, I thrive in it. I don't know why, but there's something about pressure that makes me act. And when there's no pressure, I don't act. So more pressure, the better. And that's just kind of the environment that has shaped me my entire life is pressure. Um, but I love the asphalt industry. I also specifically love the seal coating, the striping, the additional services that you can do in that type of business. And there's so many avenues of revenue. Concrete curbing, striping, sealcoat. We did winter services. So when it would snow here, it's like, those were $500,000 months for us, and going out and snow and salting and sanding and keeping the guys busy in the wintertime. French drains, you know, all that kind of catch basins. There's a lot of revenue services that are coming in and out daily.

Will Smith (24:30)

Mm. Daniel, before we turn our attention to the business that you bought, were there any near misses or other ones that you looked at that there. There's something to share there?

Danielle Nyes (24:39)

There was one business that I was honed in on, and it was almost more of, like, my emotions were tied to it versus the reality of, you know, is it really going to make sense? But. And essentially because I was. I was in this so desperate, like, so desperate to get out of my W2 that I had to train myself and my thoughts to be like, don't settle. Like, just, you know, find. Find the right one. Be smart about this. So there was a winery that I was looking at far south.

Will Smith (25:11)

Ah, the temptation. Yeah.

Danielle Nyes (25:14)

And Kyle and I hopped on a few calls with some owners that had some wineries. And ultimately, you know, when. When Kyle and I had gotten off those discussions with the owners, you know, I just said to Kyle, I'm like, as great as it sounds, I just think that, you know, these business owners that own wineries, they're essentially passion projects and they're just not gonna make sense for going into your first business by. So that was short lived, but fun.

Will Smith (25:42)

Yeah, yeah, yeah. But you know, good on you for, for recognizing that. Yeah, passion would be the word and danger dangerous to be enticed into a business where not only the business you were looking at was a passion project, but so was all the competition. Therefore, making money and being a healthily competitive industry is, is not exactly the case there because people aren't. Aren't prioritizing business logic as much as they are this out, this creative outlet.

Danielle Nyes (26:11)

Yeah.

Will Smith (26:11)

Now tell us about decorus, please.

Danielle Nyes (26:15)

Yeah, about decorus. So founded through a business broker, obviously, as I mentioned earlier, and had some hesitancy around a staging company. I just wasn't quite sure the industry feels a little bit new or kind of feels again more like a passion project. Staging and just kind of a fun. Um, it just feels like, is it a necessity? Like asphalt, you know, like we need asphalt roads deteriorate. And it's like, do we really need stuff staging? And it's just nothing I had ever explored or really understood in that industry. So didn't really pay too much attention to the industry. Obviously in my due diligence, I was more concerned with the numbers. I could care less on what industry I was buying, but the numbers were almost too good to be true. So Kyle and I were immediately, yeah, Kyle, basically off. After our first phone call with. We had a call with the broker first, got kind of our answers there and then set up a call with the owner and jumped on a call with the owner. She was fantastic. You could tell right away, just a great person. And we just had great conversations. And the second we got off that call, I mean, I'm pretty sure it was like an hour long. Kyle actually was in the background and closed his laptop and said, hey guys, I got to go to dinner, but I'm gonna like, you know, close his laptop because he was hosting the calls on his Zoom. So he went to dinner and the owner and I continued to talk and just conversate about the business. And after the call I just texted Kyle and I was like, I don't have any red flags. Did you have any red flags? And he just said, put an loi on that thing. So I put an loi on it and they accepted it. And that's when the journey began. And I was like, what am I doing? Holy. Holy cow. But the LOI was the first pro, you know, first step for me to be like, okay, I'm serious about this.

Will Smith (28:21)

Great. That was awesome, Danielle. But let's hear more about the business. First of all, most people will know, but maybe there's some who don't know what staging is. What is staging? Yeah.

Danielle Nyes (28:31)

So staging is basically what a lot of people have said is glorified moving in the interior design world. So there's different levels of staging, there's smaller levels of it. But this company is huge. It's one of the biggest in this market. But we have a warehouse full of furnishings, furniture, all types of furniture, beds, sofas, anything that you would need for a home. And we come in for any resales with realtors or for any new construction with our builder clients, they hire us and we come in and stage the home with furniture to inspire, you know, a desired luxury lifestyle.

Will Smith (29:22)

Great. Exactly. So if you've ever, ever been in a home that's for sale and the furniture is not the furniture of the, of the seller, which you can tell because usually it's going to be more. I don't want to use the word generic, because that sounds negative, but it's going to have a more. It's going to have less particularities than the seller's own tastes. Then it's been staged. And the idea is from the perspective. So, and, and who pays for that is the seller, usually via the real estate agent. Or if it's a new home builder, the builder pays. And the idea is that the home will sell faster and maybe even four more. If the home buyers that are coming to look at this home don't have to use their imagination to see what it would look like lived in. They can actually see a furnished home. And it's much easier to envision how cute life would be in that living room with furniture already in it, rather than walking into a big empty space of a living room. So, but, you know, it's. It's a premium. I mean, it ain't cheap to stage a home. And so your job is to convince the, the new home builders and the real estate agents that in fact, the thousands of dollars that they're going to pay to stage the home will. Well, you'll, you'll tell us what the argument is. But historically it's been like, the home, as I said, will either sell faster or maybe even for more if you do it. And therefore, you know, it's worth the money to, to do the staging but.

Phil (30:50)

It'S one, it's, it's also one of these where you just wouldn't have imagined.

Will Smith (30:54)

That a staging business could get very big. Can you tell us how big the chorus is either in terms of both in terms of people and revenue?

Danielle Nyes (31:03)

Yeah. So I acquired the company doing about 1.6 million in revenue in 2024. And people wise, I believe the team at the time when I acquired it was eight. Eight employees. The where we moved the warehouse as well, that's a whole nother story. But the initial warehouse that we moved into, equivalent to kind of what we're in now, but around 14,000 square feet for a warehouse. And then this year we're at 12 employees and we are approaching, we're about 1.18 million right now, approaching 2 million. I would. Or above by the end of this year, I would assume, or hope for. And do you want me to mention the EBITDA kind of where we're at with net profit?

Will Smith (31:59)

Yeah, would be great.

Danielle Nyes (32:00)

Yeah. So last year when I acquired the business, net profit with all the add backs was around 400,000. This year we're right now at around 480,000.

Will Smith (32:12)

That's awesome, Danielle, good for you. So, so in one year you've grown EBITDA 20% from 40 to 40, 480 and revenue by about the same from 1.6. If you hit 2 million, from 1.6 to 2 million, that. Well, that's actually would be 25%. So that's fantastic. We're going to want to hear how you've done that. But before we get there, you said eight employees. So these are full time employees.

Danielle Nyes (32:39)

They, they're full time now under, under new ownership with me. Prior to that, they were kind of, kind of part time, not a lot of full time going on. Besides, a couple of key managers that were there were full time on salary, but they're full time now.

Will Smith (32:59)

Okay, what does that, what does that mean that they were just not. Are you paying them more? I mean, have their hours changed or was it just kind of loosely run and, and you've tightened things up a little bit. I feel like there's something to what you're saying.

Danielle Nyes (33:15)

I, I mean, I can't really, I don't. These are my own assumptions. I think that scheduling wise, under prior ownership, there just wasn't a lot of motivation to keep reinvesting into the business, buying new furniture and booking contracts when they just didn't have the capacity for it. So I think the prior years before me were not optimizing Its full potential. Just because the transition of the sale and you know, spending more money didn't really make sense I would assume. So when I took over I really packed, packed the calendar. I, I took on jobs, I said I will buy furniture. I don't care what it takes. So there's been a lot of reinvestment into the business and a lot of, you know, just really optimizing our current, our current labor and bringing in help as well to you know, support kind of the growth that I envisioned and talked to the team about like let's, let's grow this company. And they were all on board. They knew that the company had unlocked potential.

Will Smith (34:15)

Great. Well again we're going to hear that again or in more detail. But just as you evaluated this business from the outside as a buyer, the. So it was, it was, it felt under optimized. So the existing owner was kind of foot off the gas there. You were limited. The ceiling of the business is basically the, the, the inventory of furnishings that you have. You can only stage as many houses as you have furniture to fill with. So there was this kind of ceiling. It was going to require more furniture. Basically an investment in more capex to, to grow the business. The owner, how would tell us more about the owner? Because she had left the area even. Correct?

Danielle Nyes (35:02)

Yeah. Yep. Yeah. So prior owners had moved out of Washington state. They relocated to Florida. And so a lot of our due diligence was, you know, through phone calls. They would come into town every once in a while when you know, there was some team things going on that just needed to be addressed in person. But yeah, managing through Florida. And I met them once at the warehouse locally. And part of our due diligence was to walk through and really see what I was taking on. And I was shocked. It was like a home goods on steroids and didn't realize, you know, I brought my mom with me because she's, you know, part of this with me. She's my bookkeeper and she looked at me and she said are we going to be able to handle this? And I was like why wouldn't we be able to? Why not? And then we met in Vegas as well because that's where the World Market is. And so that's where a lot of our wholesale vendors were. So we got to have some fun and play and go to Vegas. And she taught me the whole ropes of like meeting all the furniture vendors and taught me how World Market works and that was super fun. So great.

Will Smith (36:11)

So a few follow ups here. So this, so this Owner. This is, this is actually starting to feel ideal, Daniel, because you have an owner who first of all you have a good feeling from. That's kind of check first box to check. But they're truly running this remotely and without many hours in the business. So the idea that, you know, the business has sort of been stress tested in terms of how much management it needs it is surviving without a ton of being in the business versus how you kind of described the asphalt business where it sounded like the owner maybe your dad was like just at all hours just running the thing and without his strong hand the thing falls apart. Of course this is, this is the type of business we really, really don't want to buy. And so here you have a business where, where she's running it from out of state and with not many hours in the day and has taken her foot off the gas and yet it's still running. It's still, it's still doing well enough. Is that a fair characterization of everything?

Danielle Nyes (37:10)

Oh yeah, it's, I mean it was a well oiled machine from the outside. Yeah. Looking in for sure.

Will Smith (37:18)

So, so even to the point where not that you'd want to do this but if you, if you did want to, you could almost buy this and have it be passive or not that many hours a week. We don't, we, we, we don't like this word. But that's what she was doing and you could step into her shoes and similarly have it kind of be a part time ownership thing if you weren't hungry and didn't want to grow it.

Danielle Nyes (37:39)

Yeah, essentially I could have done that. However, one employee that was essentially running it for the owner while and relocated to Florida with the actual owner, she was essentially kind of me. Now I've kind of replaced her. But you know, she was the business development gal. So when I bought the company, lost that employee. But I knew my skill sets were going to replace her. But I'm hiring, I'm hiring for that eventually. But I knew kind of there was just that that portion is not so passive, but easy enough to jump into.

Phil (38:20)

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Will Smith (39:28)

Danielle, one other key unhappy occurrence in your diligence process or in your, in your process to buy the business was with the, with the original warehouse because. Right, you moved warehouses. So tell us what happened there, please.

Danielle Nyes (39:44)

Yeah, didn't really have a clue how the commercial world works when it comes to being a tenant in the commercial world. Never had to deal with that before. I've been a residential tenant, but much more difficult to be a commercial tenant. They ask for your personal finances. They want like a financial statement put together. They really kind of want to see what your net worth is. And as a W2 employee navigating this world, you know, my net worth was not a lot and you know, providing my measly little financial statement over to a, you know, commercial landlord who's, you know, looking at me as paying rent of $25,000 a month and you know, paying a deposit, whatever that might be. It was, it was very, it felt very demeaning. It, it definitely felt belittling. It definitely brought more of those fears of, you know, I'm so not qualified for this, you know, putting your personal financial statement out there and then the landlord basically saying like, this person has nothing, like, what are they doing? So it took a lot of conversations with the broker, a lot of conversations with the seller, with myself to convince this landlord, you know, that it's, it's not necessarily my personal financials trying to pay for your warehouse space. It's the business and the business is sellable and that's the asset that, you know, is paying your going to continue to pay your rent here.

Will Smith (41:20)

And to be clear, this was the landlord of the existing warehouse under the, under the seller. Under the, under the previous owner?

Danielle Nyes (41:26)

Yep, that's correct.

Will Smith (41:28)

Okay. And so did you eventually convince them?

Danielle Nyes (41:31)

We did. Push came to shove where, you know, we were, the loan was wrapping up and the SBA required some kind of assumption of lease of, you know, to show that it was approved for me to move into that lease. So the landlord said that he needed the prior owners to basically guarantee me and be signers on the lease as well. And fortunately, you know, they were able to do that because the lease was actually ending come May of 2025. So I didn't. Even if it wasn't ending come May 2025, he was still requiring the prior owners to guarantee me, personally guarantee me for another five years. And we looked at each other and just said no, we don't, we don't really want those ties. We want to sell the business and move on. And so then the talks, you know, of, we got the least assumption through of at least me being there until 2025 and us agreeing that, you know, they would personally guarantee me until the end of that May 2025 expiration. But I had to find a new commercial broker to help me find a new warehouse space because the terms past that were like requiring $100,000 deposit. I was deemed high risk to him. He just wasn't comfortable with me being there. So I found a new warehouse space, easy peasy, $30,000 deposit, moved right in, no questions asked. Yeah.

Will Smith (43:00)

Why do you think that the other landlord was, was didn't have the same hang ups as the previous landlord?

Danielle Nyes (43:07)

Yeah, I'm not quite sure. I mean this one was very owner. Owner ran so more personal like it was, you know, he owned these buildings, he managed it himself, his family. I went, when I went to a new commercial broker, I just basically presented the, the problem I was up against that I'm, you know, a landlord's looking at me as high risk. Is this pretty common? Have you worked with other people who have done acquisitions and what does that look like? And his network had tons of landlords or warehouse spaces commercially that you know, were very acquisition friendly. So I said great, let's, let's meet them. Here's the financials like let me know we're up against and no problem there. So I guess it's just a matter of different, different landlords and how they view it.

Will Smith (43:57)

Great. And so that seems like it worked out pretty smoothly once you just got got on the phone with another commercial broker and in fact that you didn't even get lucky that there would have been a lot of spaces to choose from. Sounds like it wasn't. It's going to be so hard.

Danielle Nyes (44:12)

Yeah. Thankfully I got lucky. There was a lot of warehouse spaces that had been sitting during this time for 9, 10 months to they were motivated to get someone in there. So it went very smooth.

Will Smith (44:22)

Universal lined the universal line and, and then you, but you move the entire 14,000 square feet, whatever it was. So that was a big, that was a big day or a big week.

Danielle Nyes (44:32)

That was not easy. That was not easy. But we made it through. Yeah, that's A lot of moving.

Will Smith (44:37)

Yeah. So let, let's hear what you thought. The strengths and the weaknesses of, of this particular business were just as you, as you did for asphalt. So, so what were the strengths of the, the business itself that you saw?

Danielle Nyes (44:48)

Well, the strengths essentially were the, the turnkey team. There was no issues with taking over this company as far as the operations continuing. And the strengths were the existing clientele and the brand. There was no marketing being done. Didn't need to come in and understand ads or anything like that. It's just an existing client list that has sustained and they have never had to do any marketing. So I loved that. I loved knowing that I could just come in and, you know, take over those relationships and earn their trust and build on that. So huge strengths. Plus, of course, the strength of the owner being completely removed and remote. And that instilled more certainty in me. And I had my mom as a bookkeeper, so she was just an easy. Here you go, take this over. Made the transition a lot easier. And ultimately I would look at the brand of this company and what is expected from the clientele and the standard, a strength. Since I myself have extreme high standards. I don't tolerate much underneath a high standard. So I, and that was one of the things the owner had loved about me and introduced me to the team about is that, you know, Danielle has very high standards and so she's going to be a great fit for what we've created here. So, but weaknesses, essentially, you know, even talking to the owner really about weaknesses was just stuff that was easy to fix. Social media was lacking, the presence online was lacking, and no marketing. So there was just room, room to grow. And inventory was getting a little dated. So there was definitely that realization going in that we'll have to for sure invest.

Will Smith (46:44)

Well, Danielle, the, the no digital marketing thing is, is a strength masquerading as a weakness. We, we like to see this because it's, it's, you know, it's, it's an immediate lever we can pull. I will, I will volunteer a couple of, of weaknesses that I see that are inescapable and just ones that you're going to have to get used to. And I'd like to hear how you did get used to them or get, wrap your head around them. So this is going to be a business that is really tied to residential real estate. To the, to the, to, to one of the most notoriously cyclical markets. How did you get comfortable with, you know, when real estate is banging, you're going to do well and when not.

Phil (47:21)

Not.

Danielle Nyes (47:23)

Yeah, that crossed my mind and definitely made me a little bit fearful and kind of, you know, going into buying a business, I'm like, staging asphalt. I feel very certain in, like, those asphalt type of industries. But I just trusted the numbers. I saw how the business did during COVID I trusted the fact that the revenue was just growing year over year, substantially, and I trusted the reviews of the business. And the. The clientele were big, big brand names, very well known here. So I kind of just rode their coattail of success and just knew that if I keep those clients happy, if they go. If they don't go down, then I don't go down.

Will Smith (48:14)

And when you talk about the. The clientele, you're talking about home builders. Big Seattle area home builders, correct?

Danielle Nyes (48:20)

Yeah, the biggest.

Will Smith (48:22)

And so was. Is there a concentration feature here where a lot of your revenue comes from one or two or five customers?

Danielle Nyes (48:34)

I'd say we have one big whale. That is something I want to focus on for sure. They're a very happy whale. Very, very happy. But, you know, if something happened there, it could hurt. It could hurt the revenue if I don't keep a close eye on that. But. But we just have so many clients, and it's just. This whale has just overproduces all of our other clients and their existing, you know, competition. So, of course, we want that business, and we do our best to. We just. We got to grow our internal team so we can take on, you know, more whales and kind of whale it out a little bit. Does that make sense?

Will Smith (49:14)

Diversify the wheel in the organization. Okay. And then obviously, this is. Is seasonality would be the other one. This is the, you know, a weakness. But as long as you're good on cash flow and you're really attentive to it, you can manage around it. But the real estate market is, again, tying. This is tied to the real estate market. The real estate market is very cyclical. Fallen spring and fall. So that must be when you collect all your revenue and those in the seasons leading up to spring and the season leading up to fall sort of thing.

Danielle Nyes (49:52)

Yeah, I mean, I took over the company last year in November, December, which are supposed to kind of be our slower months. And, you know, the prior owner saw it as an advantage because it would, you know, not put me kind of in the middle of chaos while I'm trying to learn the transition of things. And. But we were still really busy. We had a record month in December, January during the holidays. I could feel a little bit of my fear Kicking in because I'm like, oh no, no, leads are coming in. I started wondering, like, should I kick in the marketing? Should I get ads running? But that slowly picked right back up. In February was another record month. So I don't know what to expect going into the current months. I have a feeling, a really good feeling that our builders don't have seasonality. They, they keep building, they keep listing. Um, I think if you work primarily with realtors, you might feel that a little bit more. Um, but I think the builders is a really good diverse way to kind of help navigate that in this industry. So we'll see.

Will Smith (50:55)

One thing, Danielle, that you haven't said yet is that also the, the niche in the market of staging. So surprise, surprise, staging is a bigger industry than we all thought. Than I thought, as seems to be the case in all my interviews. So big, in fact, that you don't just do all staging, you play in one tier of the market. Say more about that, please.

Danielle Nyes (51:17)

As in the luxury market. Yeah, yeah. So we're really targeting, we do some homes within the 2 to 3 million dollar range with our builders. But like our really good contracts are homes in the 8 to 10 million dollar range. Those are really where we're trying to go more so of. We've gotten a few of those. But 5 million is kind of our sweet spot of, of a home listing. But as we grow, we want to get into those bigger calibers of homes.

Will Smith (51:48)

And, and the, the good thing about serving the luxury market in real estate is I think it's, it's, it's known to be more insulated from, from the ups and downs of the more normie real estate market. It certainly isn't fully insulated, but rich people continue to buy houses when, when the middle class doesn't. So that, that probably will help to smooth out some of that. Some of that cyclicality would be my guess.

Danielle Nyes (52:18)

It seems to have proven itself. I've always heard you should solve rich people's problems. So I like the idea of being in the luxury market where there is rich people.

Phil (52:28)

And so, Danielle, you said 5 million.

Will Smith (52:30)

Is your sweet spot. Okay, so you live in Amazon land, you live in Seattle, you live in Microsoft land. But are, are there really that many $5 million houses that are selling every year? I mean, I live in the D.C. area, which is a pretty wealthy market, but I don't feel like there are that many $5 million houses. Maybe I just set my filter lower than that. So I don't see them.

Danielle Nyes (52:52)

I mean, yeah, they're going up everywhere right now, anywhere from 3 to 5 million new construction homes. One of our biggest builders, you know, they have a huge, huge land development and you know, every home that they put in there is minimum 5 million that we stage for them at our reserve package. So yeah, they're building like crazy here it seems, and I'm thankful for that.

Will Smith (53:14)

And then so just give us a sense of like if, I don't know if you can say this publicly, but like what your, what it cost to stage a home from you guys, like you're a rough sense of your pricing. Can you share that?

Danielle Nyes (53:24)

Oh yeah, I can share that. All of our clients know, obviously, but I would say our average staging contract, like when we work with a realtor with like a $3 million home and the homeowners typically pay for this is usually 10, 10,000 for our standard package and our builder clients. Bigger homes, kind of a mid tier to more luxury package range anywhere from 15,000 up to the highest contract I've sent out this year since I've owned The company was 50,000.

Will Smith (53:57)

Wow. 50,000.

Danielle Nyes (54:00)

Yeah.

Will Smith (54:02)

Well, you know, you know, it's. If you can, if you can make the argument that if you spend 50,000 on staging and this sells a month faster or three months faster, it pencils that, that expense pencils. But you actually had said something to me in the pre call, Danielle, that this, this value prop of will sell the home faster for you if you use staging or for a higher price is actually not one that you use anymore. What is the key value proposition when you go to clients to try to convince them to use your staging services?

Danielle Nyes (54:34)

Yeah, I think that's just kind of the overran slogan in the industry, you know, sell faster for top dollar. And you see that on every staging website. So how can you really differentiate yourself when that's kind of what you're going after? So we, you know, yeah, we kind of, you know, obviously understand the impacts of staging and it does, it can provide that, but we don't like to focus on that as our offer. We can't control that. So what we can control though is our internal design. We can control the fact that in house we produce our own art. And that's a huge differentiator. It completely makes the home stand out on the market. So our proposition when we work with new clients, we don't have to convince our current clients, but new clients that come to us that have walked our stages or have heard about us is, you know, essentially like how, how tailored and how picky are you when it comes to what you want in your home. And, and we basically just want to partner with them and elevate their brand, elevate, you know, their reputation on the market. Because when you list a home, you know, and you have your, your builder name on it, the staging really complements that or doesn't so much compliment that. But our staging, I mean we just met with one of our builder clients last week and took the team in and they just ran and rave about us. And it just feels so good because we just know that our quality is unmatched.

Will Smith (56:02)

Great. Now you said that you and the owner in your first zoom call, Kyle was there too. Then Kyle had to go to dinner, so he shut his laptop and hopped off. You continued talking to the seller. You get off the phone with the seller, you text Kyle and say, I really like this one. Kyle says, put an LOI on it. Why are is Kyle so enthusiastic about it?

Danielle Nyes (56:21)

Yeah, I mentioned earlier, you know, the numbers felt too good to be true. So ideally, looking at it, I, it was kind of mindboggling. I'm like, how did they come up with this price? You know, we knew that it probably, probably should have been at a 3x multiple minimum since the owner was so removed from the day to day operations. But, and I can't speak factual on this, I just assume that the broker maybe took it as a cyclical industry and maybe that was a high risk and maybe priced it as such just to help get the sale across the finish line sooner than later. But it was really just kind of packaged at a purchase price essentially for the inventory and the assets that were provided.

Will Smith (57:07)

How much in the way of inventory and assets were there?

Danielle Nyes (57:12)

There was about 650,000 on the balance sheet for assets. And I think the, the purchase price was advertised on biz by sell for 780,000 for the business.

Will Smith (57:26)

780,000. And it was SDE of 400 a year. So purely by an SDE based on an SDE multiple, it was less than 2x for a business that was pretty established, you know, and as you said remotely run, the owner was, was not even in, in the day to day. Yep. So as we talked about in the pre call, that's, I think that's probably why Kyle was so excited. I mean all the other reasons to like it, but to like it as well. But that is, you just don't hear about that very often.

Phil (58:05)

So.

Will Smith (58:07)

In fact what you'll often hear is, is sellers, what they'll try to do is, is sell it at a multiple based on Earnings or based on sd and then say, plus inventory, and they expect you to pay inventory separately. Now, that doesn't really work because the inventory is the oxygen of the business, and some. But in this case, it was almost like, just sell the inventory and get.

Danielle Nyes (58:25)

The business for free, what it felt like.

Will Smith (58:29)

So. So. So you Pay. You said 780.

Danielle Nyes (58:35)

780 was the purchase price, and then the entire loan included working capital at the end of the day.

Will Smith (58:41)

How much working capital did you put in?

Danielle Nyes (58:42)

I think 160,000 I got in working.

Will Smith (58:45)

Capital, so that takes us to 940. Does that sound right?

Danielle Nyes (58:50)

It was a 940. It was around 880,000 is what my SBA loan, but. Oh, I had a down payment, though, so. Yeah, yeah, yeah, that makes sense.

Will Smith (58:57)

Okay, okay, okay, great. The down payment, can you share with us what that was and where that came from? Because we've heard you mention her a couple of times already, and she. She was very instrumental to this.

Danielle Nyes (59:10)

My mom, Right. Yeah. My mom had recently received some inheritance from a family member that had passed, unfortunately, and we had that money just kind of sitting in a money market. And, you know, she probably was gonna have to pay quite a bit of taxes on that. So when we went to that business buying class, I just said, what do you think about supporting me in this? Like, I don't have the cash of 200,000 sitting in a bank, and if, you know, you trust me and this is what you want to do. And given we had both, you know, left the family business and had kind of been, like, in our own identity crisis, like, we were truly committed to running the family company and taking that over.

Will Smith (59:55)

You guys were both, huh?

Danielle Nyes (59:57)

Yeah, totally. Even though my parents are divorced, you know, I convinced my dad to hire my mom back into the company as the bookkeeper. They started it 40 years ago. And then I convinced her to move back from Idaho back to Seattle and come work again in the family business. When we had our bookkeeping, our whole accounting team just bailed on us. So we were kind of in a crunch, and I was like, bomb. Do you want to come back to familiar territory? And she came back, and. But, you know, some stuff happened, so we were both kind of pushed out of that and, like, what do we do next? And so she decided to trust me and said, I'll borrow you the money. And she was not involved at all with my due diligence. She trusted me. I. She just took my word for it, and she's very proud. Very proud.

Will Smith (60:41)

And so she lent you the money or did you essentially.

Danielle Nyes (60:45)

Yep. She just put my name on the money market account, and so I was able to kind of just spend the money as I needed as I went through the due diligence process and just kept tabs of kind of all the money I was taking and using for this. Obviously, it's not cheap to go through due diligence. I had hired other parties involved in this to help me get through this. So obviously paid for Kyle and Jake's coaching. I paid for a firm to help me do quality of earnings and purchase and sale agreement and all that stuff. So we just, you know, worked it out after the closing of the sale, put it on the books, and we'll figure out how that whole thing works out, you know, as a side.

Will Smith (61:22)

Yeah, so. But essentially she just trusted you. These are. This is essentially a loan. You'll work it out, you'll pay it back over time. And so it's kind of a quasi loan, quite quasi investment. I mean, she doesn't have equity in the business, but she's kind of invested in you. And. And she's actually now earning money herself out of the business by being your bookkeeper.

Danielle Nyes (61:43)

Yeah, we're invest. Yeah, we're invested together regardless of kind of, you know, how ownership works out or where things go with the business. But it's a huge goal of mine to help my mom retire, so I'm working hard to get her to a place where she's comfortable.

Will Smith (61:58)

Oh, wow. Great. Was there any seller note in the acquisition?

Danielle Nyes (62:04)

There was room for it, but ultimately we didn't end up needing it. So we talked about some seller financing, but when it came down to the SBA approval and due diligence, it was not necessary. So we just bailed on that.

Will Smith (62:19)

And that's probably because you were getting it for such a good price, I would imagine, from the lender's perspective, because often the lenders will want to see a seller note just to see some alignment with the set from the sellers in your future success.

Danielle Nyes (62:31)

Yeah, essentially they came back to me at one point and said they might require 15% down. I don't know where that came from or why. So I ran that through Natalie and just said, you know, that's kind. Kind of going to put me in kind of a crunch with kind of not having extra reserves left over. So she was totally fine with doing like a carry on that 5%. And so the bank was good with that carrying the rest of that down payment, but wasn't needed.

Will Smith (62:55)

At the end of the day, it Wasn't needed. So you got her to agree to it, but ultimately it wasn't needed.

Danielle Nyes (63:00)

Wasn't needed. Nope.

Will Smith (63:01)

Anything more to say about the acquisition in the terms and the deal before we. We start. Start wrapping up here and hearing about your ownership, or is that it? So on the terms?

Danielle Nyes (63:12)

Yeah, on the terms, it was pretty simple. SBA loan, 10% down, went through a bank.

Will Smith (63:17)

Okay, Daniel. And so after you buy the business, Kyle exits, stage right? Or does he continue to be your coach?

Danielle Nyes (63:28)

No, once we got pretty much into the process where I was dealing with SBA and things were looking finalized, I would just told Kyle, like, hey, I think we're good on the coaching side, but, yeah, great.

Will Smith (63:42)

So what does it look like as owner? What maybe. Is there anything to say about the transition? The first early months in the business?

Danielle Nyes (63:51)

Oh, man, it was definitely scary. I was very. I was fearful. But face it, till I make it. And day one was pretty simple. I mean, I just kind of came in and met the team, and the owner had flew in from Florida to spend a week with me and just kind of, you know, handing things over. It was on her end. Not a whole lot that really needed to be done. We were just changing names over, you know, calling all the utilities, vehicle registration, cell phone accounts. She didn't really have to train me on much. She was just kind of there for moral support while the other employee was remote. And in Florida, this employee was still working behind the scenes for me on a 1099 contract basis. So she flew in for two weeks after the prior owner left, and her and I, that's when we really got into the nitty gritty. Where I was actually taking over was in that second to third week of my training and kind of just taking over the systems, the email accounts, the social media, anything and everything that I needed, obviously, to transition into new ownership. So I did spend. We closed. We closed the day before Thanksgiving. So I was spending Thanksgiving with my family getting employees onboarded into our payroll system. That just happened to be where we landed.

Will Smith (65:25)

So your family, meaning your mom?

Danielle Nyes (65:28)

Yeah, me and my mom. Yeah. But I mean, we. I mean, basically our Thanksgiving meal was a write off. You know, we were onboarding new employees and getting our. Just getting everything transitioned over into our QuickBooks and into our payroll system and sending out our offer letters. So that was a lot. Just I had no idea what to expect and I just reactively handled it after closing.

Will Smith (65:54)

How did the team react to you?

Danielle Nyes (65:56)

The prior owner, she. Once we officially got the notice from our bank that we were Closed, and my fiance and I had gone into the building to sign all of our paperwork. We jumped on a Google Meet the next morning with the entire team and were able to finally release. You know, here's the new owner. And so I met them all remotely first and got a chance to let them know how excited I was. And they were all very excited for new ownership. They expressed that. And pretty simple transition as far as it came to the team knowing that, you know, a new owner was coming in. Word had gotten out through the whole due diligence process that that was happening.

Will Smith (66:35)

So let's close out by hearing how you have grown the business. You told us that it you. It was a million doing a million six when you bought it, and you're on track now to hit, maybe even exceed 2 million this year. So. Say more. You said you've made some investments in growing the inventory. The actual furnishings that you stage with that you've been hustling after trying to fill everybody's calendar. So expand on that, please.

Danielle Nyes (67:07)

Yeah, I mean, ultimately when I took over, I had a hard time saying no to contracts and to revenue. So I just was booking left and right while. While I was also learning, you know, what the team can ultimately handle. And I had no clue. And that was. That was a huge learning curve for me, kind of how long it took right, to like, pull a stage and to put all that together. So a huge learning curve for me culturally and just kind of navigating, you know, not just putting revenue first, but understanding kind of our capacity. So that helped a lot. Obviously, just kind of booking revenue and not declining contracts and optimizing our calendar, hiring right away. Because I could tell that, you know, we wanted to be able to fulfill that demand. So got a full team now and buying furniture really to be able to fulfill the contracts. And with buying furniture came increasing our prices because we were buying better quality furniture, better design, and so started increasing our prices to kind of offset, you know, the percentage of furniture we were really purchasing against our revenue. And that's really contributed to the growth and being able to take on new builders and new clients.

Will Smith (68:32)

Danielle. Just on the kind of working capital of the business. So to hire people and take on more jobs, we understood that, that the reason the previous owner wasn't would. Would say no to jobs is because there just wasn't the inventory. You guys didn't have the furnishings to put in contracts sometimes, so you'd have to decline them. So to grow meant investment in more furnishings and in more people. You told us that the business was $400,000 of SDE. You presumably are paying yourself.

Phil (69:05)

Right.

Will Smith (69:05)

Are you paying yourself a full salary a little bit or not a ton.

Danielle Nyes (69:09)

Just take an owner draws out right now, just full transparency. I only pay myself 4,000amonth out of the business. I pay my mom about the same. We're taking a reduced salary for our first couple years in business and we're okay with that. Where my fiance works a full time job, so he does plenty well for this household and just trying to focus on the growth of the business and our reserves and our profit.

Will Smith (69:32)

So if you're paying yourself for your mom for that's a about 100 grand a year to the two of you. Half of your 400 is going to your SDA loan. Call it SBA loan. Excuse me. So that leaves another 100 grand roughly to, to make these investments. I'm just trying to understand where the money to reinvest is coming from because it wasn't a huge amount of earnings coming out of the business.

Danielle Nyes (69:58)

Yeah. So we're at 480,000 net profit right now after our SBA loan. So that our SBA loan is. Yeah, but really right now, to be fully honest, we're kind of just surpassing break even as it relates to the inventory that we have purchased so far this year. We're just now starting to pay ourselves back for what we've invested into the business so far. I mean, what's interesting about this company that I've had to learn that's different from asphalt is these are, you know, the, the purchasing of our inventory goes on our balance sheet. So it doesn't really reflect on our financials like essentially that that money is gone. It shows are really profitable. But you know, on our balance sheet you'll kind of see where we've spent on inventory. So I'm hoping this next quarter, you know, we, I mean we've already paid ourselves back for the inventory at this point. We've spent maybe 200 to 300,000 in new inventory and we've still been able to put away reserves for the company. We have about 225,000 sitting in our reserves account. So we're, we're slowly but surely kind of, you know, climbing that, climbing that mountain and getting out of that, you know, zero dollar bank account when we started. And my mom and I are really diligent when it comes to our cash flow and kind of how we manage that and.

Will Smith (71:20)

Sorry, when did you close?

Danielle Nyes (71:22)

November 27th of 2024.

Will Smith (71:27)

Right, right. Thanksgiving dinner. So Thanksgiving last year. So you're coming up on. You're coming up on one year.

Danielle Nyes (71:33)

Yes.

Will Smith (71:33)

So you basically took all the earnings after the SBA loan, after paying you guys a nominal salary of 50 grand each, call it. And took the rest of the earnings and reinvested in inventory, in people.

Danielle Nyes (71:46)

Inventory and people. That was our focus. Yep.

Will Smith (71:49)

And. And started saying yes to projects.

Danielle Nyes (71:52)

Started saying yes to projects. And, you know, we gave the team substantial raises. We went. We sat down with the whole team after 90 days and kind of after understanding, you know, the. The responsibilities that were going to be put on them. As a new owner, I don't have the talent of this industry, so I really needed to kind of extract more responsibilities out of them. And so they're all making more money and much healthier.

Will Smith (72:19)

And on that point, Danielle, I meant to ask this much earlier in the conversation. You're not coming from this industry and not doing the design work, like deciding how, you know, what piece goes where in a. In a. In a house and an $8 million house, maybe. Yeah. Who's doing that work? And is there key man or woman Risk? There is it. Is that all in one person's brain, or do multiple people do that, or what does that look like?

Danielle Nyes (72:42)

You know, the huge kudos to the prior owner because she really set this team up so, so well. There is a design manager who you could essentially say is, you know, key man risk. The design manager is very, very talented and what he does, he really oversees the design and has really leveled up our stagers and designers. There's. There's three stagers, there's a design manager, and then we have two support staff that we've hired underneath the designers to just help support the workflow. And between the four of them, the design manager and the three stagers, they are just fantastic. They're owning it. They. They understand the design. They. They're. Yeah, they're just killing it. So that's who does the work. There's a full turnkey design department. It's kind of like project management. We get a contract and you hand it off to the lead stage, early designer, and they source sometimes if we don't have the inventory, through our wholesale vendors. I've trained them on that whole process. I've given them kind of budgets to follow and timelines and. Or they just pull from our warehouse if we have good enough inventory, and then we have a whole team of logistics in the warehouse. And there, you know, are. There are guys that help us with all the moving, the heavy lifting of the furniture, loading it into trucks and unloading it at the homes and installing the beds and installing the tables and all that good stuff.

Will Smith (74:10)

So there's the logistics team are the ones who pick stuff off, load the trucks from the warehouse, and then also do the moving, installation, and then take down the staging as well and reshelf everything.

Danielle Nyes (74:21)

Yep. And it's all hands on deck at a stage. I mean, we have our whole design team typically there and our logistics crew. So there's a team of 10 usually and a home. And that's why we're so quick. We can get a home stage now and in six hours. So we're in and out. It looks fabulous. And then our clients can get photos and get it listed.

Will Smith (74:39)

Very cool. You had talked about the World Market in Vegas, that the previous owner took you there. What is World Market? It's a. It's an. It's like an industry event where you go and buy this stuff, buy kind of home furnishings. What is World Market?

Danielle Nyes (74:53)

Yeah, World Market is a big conference center in Las Vegas. It's full of three buildings, like 48 levels of floors. And it happens once a year or twice a year there in January and in July. And it's just full of. It's, you know, it attracts interior designers, stagers worldwide. And that's where you kind of meet the vendors and get to check out the quality of furniture, understand pricing. And that's kind of like your strategic, you know, advantage on who you're sourcing through and how you're keeping your profit.

Will Smith (75:26)

And when you were doing your diligence, how did you diligence all that inventory, that $650,000 of inventory, to see if it was a. The right valuation.

Danielle Nyes (75:39)

Trust.

Will Smith (75:40)

Trusted. Yeah.

Danielle Nyes (75:41)

I went and looked at the warehouse. I saw the designs that were being put out. Website, Instagram. Yeah, it. It looked very high end.

Will Smith (75:52)

In, in retrospect, do you feel like 650 was accurate enough?

Danielle Nyes (75:57)

Oh, yeah, A thousand percent. We're still using that inventory. It looks great.

Will Smith (76:01)

Yeah, yeah, yeah. Great. And lastly on the lack of marketing. So you've been hustling after contracts. So on the doing sales, bd, but on marketing, digital marketing. Have you amped that up yet? What does that look like?

Danielle Nyes (76:15)

Just started. I brought on a website vendor and to help. The prior owner's husband was very tech savvy. He did all the SEO and website stuff. So when that kind of got handed over to me, I was like, I'm not touching that unknown territory. I'll, you know, deal with that later. Didn't really need to Focus on that upfront initially, but now, you know, I, I did see some opportunities in the website that could use some help when it comes to, you know, your marketing and your presence. So we did relaunch a new website. That project just came across the board a month ago and we're just starting Google Ads to really target kind of that 5 million avatar builder. That's kind of what we want to go after and kind of fill our pipeline with, with more of those clients.

Will Smith (77:06)

And Danielle, how big do you think you can grow revenue too? I mean, I know that that's, you know, b, you can be as loose as you want, but how, how big can this business be? Do you feel like there's a lot of five and $8 million houses you're not yet staging that you should and could be?

Danielle Nyes (77:24)

That's a really, really good question. And something I ask myself every day is, you know, what is the full potential of this beast that I have under my belt? Obviously, if we continue to blow this thing up, not if, but when, we will need a larger warehouse. My mom and I have a, you know, five year goal where we really would love to buy commercial property and buy a warehouse that's large and able to fulfill, you know, growth opportunities so we can put more furniture in. I thought of other revenue sources like adding an interior design and doing that as a side. We're starting to get a lot of calls with our staging, asking if the homeowners can hire us for interior design because they love our stages so much. And then I've also thought about, there's some other staging companies out there that I watch and there's one called Vesta. They have their own furniture line. And I'm like, that would be really cool to kind of differentiate ourselves as well. We already do our own art, so what if we built, you know, and I learned how to navigate that world of, you know, the world of product. And I have no clue how to even start there, but you just, you learn. So it's like a new furniture line. There's, there's ideas floating out there. So I'm excited to explore kind of what that looks like in a five or ten year plan.

Will Smith (78:44)

Great, Danielle. And to close, let's return to the psychology here, the Layla Hormozi. What is it? F Your feelings. What is it?

Danielle Nyes (78:57)

F Your mood. Follow the plan.

Will Smith (78:59)

F your mood. Follow the plan. How, how are you feeling? How is your self confidence these days?

Danielle Nyes (79:06)

It gets better every day. Just gotta get in the arena and get through it. I would still say that any human, regardless who you are, you still have, you know, doubts or limiting beliefs. But I've learned that, you know, that those don't define me. Those don't define the outcome. And I just have to act regardless of how I'm feeling. That eliminates the anxiety for me. If I'm feeling anxious, I know it's because I need to get something done or get something off my plate.

Will Smith (79:33)

Well, it's a great story, Danielle. It's a, it's an interesting business. I have used stages before, so I was particularly interested just from a real estate industry knowledge angle. And of course I love that you just charged forward. You know, intimidating though it might be to follow this path. And I'm sure many people that I don't ever hear from and don't come and sit in your seat is because they, at some point along the path, get discouraged or intimidated and decide that they can't move forward. And you, like Horosi says, you just trusted the plan and here you are. And you and you continue to so those are, those are wise words from Leila, I guess.

Danielle Nyes (80:15)

Yes.

Will Smith (80:16)

The the URL of the business, please.

Danielle Nyes (80:19)

It's decorous.

Will Smith (80:20)

Homestaging.com decorus homestaging.com Danielle Nys will include a link to the business and to your LinkedIn in the show notes. And we really thank you for your time and transparency on your deal. Congratulations on it.

Danielle Nyes (80:35)

Thank you. Thank you so much, Phil. Appreciate your time and letting me share my story. Thank you.

Will Smith (80:40)

Hope you enjoyed that interview.

Phil (80:42)

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