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From SBA Loan to High 8-Figure Exit

Acquiring Minds

Mon Sep 15 2025

Summary

Acquiring Minds: From SBA Loan to High 8-Figure Exit

Episode Date: September 15, 2025

Host: Will Smith

Guest: Jared Pierce, Owner, Olympic Holdings Investments

Overview:

This episode chronicles Jared Pierce’s journey from a challenging childhood to an eye-popping home services business exit approaching $95 million. Jared walks us through buying his first business with an SBA loan, the tenacity required to drive 10x revenue growth, the strategic and personal philosophies that set him apart, and the critical importance of presence and grit. Host Will Smith dives deep into the tactics, mindset, and lessons from both Jared’s massive win and his most recent, humbling business setback.

Key Discussion Points & Insights

1. Jared’s Upbringing and Its Impact

Background Hardship: Grew up in Seattle and Missoula, often homeless or in foster care due to his mother’s addiction and incarceration.
Stability and Growth: Found some stability living with a friend’s family, which led to academic and social success.
- “At the time... as a young kid... it's not as difficult to think about as it is as an adult, but in and out of foster homes up until the age of about 10. And that's when I was in a permanent foster home in Missoula, Montana.” — Jared Pierce (05:55)
Adaptability: Developed interpersonal skills and resilience due to needing to "fit in" in constant new environments.
- “You kind of learn how to survive in a non traditional environment...For me...being able to...carry myself as best as possible and get along with people as best as possible.” — Jared (09:38)

2. From College to Private Equity to Harvard Business School (HBS)

College Path: Attended University of Montana, then Seattle University after reconnecting with his biological father’s family.
Finance & PE: Internship led to investment banking, proximity to a Black partner at a NYC-based PE firm led to an operational PE role.
Applying to HBS: Encouraged by mentors in PE, got into Harvard; initially felt some imposter syndrome.
- “Getting my MBA had occurred to me. But never going to Harvard or, like, Stanford, like an Ivy League, a top business school. That hadn't really occurred to me.” — Jared (15:00)
Outcome: The “Harvard halo effect” was a major career accelerant.
- “When you meet other folks...you tell somebody you go to Harvard, they just think you're smart. Whether you are or you aren't, you get this instant level of credibility.” — Jared (20:09)

3. Discovering Acquisition Entrepreneurship

ETA Coursework: Took Entrepreneur Through Acquisition (ETA) courses at HBS; the idea of operating his own business grew on him.
- “The idea of taking a business, thinking about it as a team and trying to win as much as possible, I found that part interesting...by the end of my second year, I was leaning towards it more and more.” — Jared (22:54)
Search Fund vs. Self-Funded: Opted for a self-funded search due to value of equity and greater potential upside.

4. Self-Funded Search: Tactical Deep-Dive

Selling the House: Used proceeds from a house-hack with friends (bought for $290k, sold for $595k) as his “war chest.”
- “I knew that I needed cash. So I sold the townhome...I walked away with just, you know, call it $300,000.” — Jared (31:17)
Local, Proprietary Search: Focused search within two hours of Seattle; exhaustive local networking and direct outreach.
- “I met so many business owners... probably changed now, but five years ago, I don't think anybody knew more small business owners than me.” — Jared (34:24)
Tactics:
- Cold email, then cold call if needed (“lead with an email first, always”).
- Used Harvard/Olympic Holdings credibility in outreach even when his team was just him and unpaid friends.
- Paid attention to seller lifestyle as a proxy for the true quality of the business (“What is the owner’s life like? Would I want that?”).

Notable quote:
“I only saw a business that an owner was willing to sell me at a price that I could afford to buy.” — Jared (37:42)

5. Acquiring Mercurios – The H Vac Business

Selection Criteria: Chose a business where (1) the owner was NOT essential, (2) organization had no single point of failure, (3) owner had a good life not “chained” to the company.
Deal Terms: $1.75M purchase price on ~$500K SDE, 15 employees, 1993-founded.
- Structure: Approx. 15% equity (all his cash), 10% seller note, 75% SBA loan.
- “I did a little bit more than 10%. I think I put 260 grand in. So it was essentially all the cash I had. And then the rest was an SBA loan.” — Jared (59:27)
No Outside Investors: Kept full equity for himself—critical to the later outcome.

6. From Operator Rookie to $35M Revenue Titan

Strategy:
- Obsessive learning of the trade (sales, technical basics, digital marketing).
- “If any of the sales guys leave, I’ll just do the sales myself...It was really about survival. I need more people, I need more expertise...” — Jared (53:20)
Tenacity: In the office 7am–7pm every day (yes, even many Saturdays).
Marketing Innovation: Managed all digital campaigns himself, ramped up spending as returns justified it.
- Marketing spend: $38K/year before; $1.4M/year at sale.
- “Our budget when I bought the company...By the time I sold it. Our total marketing budget was 1.4 million.” — Jared (68:02)
Acquisitions: Bought more HVAC companies and an electrical company to “bolt on.”
Culture: Modeled “team” leadership, learned in the trenches, built loyalty by example.
- “I think what helps me as a leader is that folks just saw that I was willing to roll up my sleeves...People within an industry see you taking interest in their trade, in their profession and learning more and more...they appreciated that.” — Jared (75:57)

7. The Blockbuster Exit: Timing, Terms, and Philosophy

Growth Numbers:
- Revenue: $3.5M → $35M in 5 years
- EBITDA: $0.5M → $6.5M+
Exit Timing:
- Caught the apex of private equity HVAC fever (late 2022).
- “I had a $95 million offer...I was pretty close to that at what I sold at.” — Jared (84:36)
Negotiating Position: Didn’t need or want to sell — strongest bargaining chip.
Team Rewards: Gave key employees $1M+ from the sale, even when not required.
Reflection:
- Instant credibility of the Harvard degree helped.
- No outside investors meant the windfall was almost entirely his.
- “The worst that's going to happen is I'm going to be bankrupt. Right. And I've grown up without anything anyways. So I just was looking at it...I was just going to go it, go it alone.” — Jared (61:56)

8. Wealth and Life After the Exit

Personal Adjustment to Wealth:
- Still lives relatively modestly; doesn’t “feel rich.”
- Focused on preserving and growing family wealth, not just spending it.
- “We have some nice stuff and we have a couple of home...but for us, I just don't feel like I'm as wealthy as I am as paper would show.” — Jared (94:02)
Family Office: Manages investments in real estate, companies, public equities.
- Hopes his daughters may one day run the family office.

9. The “Nightmare” Next Acquisition: Humbling Lessons

Bought a Windows/Doors & Auto Glass Co. (ST Glass), expecting a repeat but faced immediate setbacks.
- Staff departures, poor processes revealed (“scheduling on paper,” broken accounting, huge overpay on some roles).
- Revenue fell from $6M to $4M, long months at a loss.
- Slow to rebound; only recently breaking even after almost a year.
Biggest Lesson:
- You must be present. His lack of daily involvement, compared to deep immersion at Mercurios, directly linked to weaker results.
- “If you are going to buy a company, you have to be present. Like, you have to be there and fully invested and committed to its success more than anybody else...I became obsessed with Mercurios and was all in and it benefited.” — Jared (119:41)
- A strong team without owner presence isn’t enough, especially in a turnaround or when critical skills have left the business.

10. Reflections on Search, Industry Selection, and Operator Mindset

Industry Trends:
- HVAC/private equity roll-up momentum reached its peak ~2022 (“You’re late to like the seller’s expectations...a good business, they're going to want high single digits [EBITDA multiple] for sure”).
- Other industries (windows, roofing, etc): May not present same recurring revenue, TAM, or tailwinds.
Opportunity Over Theory:
- “What trumps being opportunistic trumps everything for me. So if you get a great buy in an industry that's in the ninth inning or the first inning, but you have great transaction dynamics, I would say pursue it.” — Jared (122:59)
Advice:
- Get obsessed with ONE business.
- Presence, hustle, and genuine learning trump resume and theory.
- Assess seller involvement — don’t buy businesses where profit depends on something the seller does that you can’t/won’t.
- Beware “balance sheet making you soft” after a big win; presence still matters.

Notable Quotes & Memorable Moments

On Choosing Which Business to Buy:
“I only saw a business that an owner was willing to sell me at a price that I could afford to buy.” (37:42)
On Owner Involvement & Business Quality:
“I don't like to really buy businesses from people that are too young, because I...if you're able to run this business for 30 years, I feel like, well, it can't be that bad...” (51:29)
On Grit & Sacrifice:
“If you are going to buy a company, you have to be present. Like, you have to be there and fully invested and committed to its success more than anybody else.” (119:41)
On Being Wealthy:
“I just don't feel like I'm as wealthy as I am as paper would show. And I don't know why that is...Maybe it's because it's still only been a couple of years...” (94:02)
On What Trumps All:
“What trumps being opportunistic trumps everything for me. So if you get a great buy in an industry that's in the ninth inning or the first inning...I would say pursue it.” (122:59)

Important Segment Timestamps

(05:55) – Jared’s early childhood hardship and foster care
(15:00) – Journey to Harvard Business School
(22:54) – Discovery of entrepreneurship through acquisition
(31:17) – Funding the search by house hacking
(37:42) – Why he picked the business he could afford, not the “perfect” industry
(59:27) – Details of the SBA self-funded purchase structure
(68:02) – Ramp-up of marketing spend and its impact
(84:36) – The $95M offer and summary of the exit
(94:02) – Weighing wealth and life post-exit
(119:41) – Why presence matters more than experience
(122:59) – Evaluating industry opportunity

Overall Takeaways

Self-funded search can yield truly life-changing outcomes — IF you stay aggressive, flexible, and present.
Obsession beats delegation, especially for first-time business owners in complex service businesses.
The most important “competitive advantage” is showing up and learning your business cold.
Massive upswings often come from timing you can’t control — but preparation and all-in commitment put you in position to benefit from them.
Your second deal, even with all the experience in the world, can still humble you. Presence, again, is the difference.

For would-be acquirers:

Scrutinize owner involvement — don’t kid yourself about your “transferable skills.”
If you can, keep the cap table clean.
Presence beats theory; don’t expect to simply “manage from afar.”
Even after a home run, humility is required — your next deal can still be a nightmare.

End of Summary

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Transcript

Podcast Host (Acquiring Minds) (0:00)

Today's story has an eye watering outcome and it shows the potential of buying a business. Jared Pierce used the equity from a townhome that he'd house hacked with some buddies to buy an H Vac business doing three and a half million in revenue. Half a million of sde. He was able to buy the business himself without investors. Five years later he sold it for upper eight figures. Jared doesn't tell us the exact figure, but he does say that he turned down $95 million. So it had to be in range of that. Jared is humble about this staggering success. He acknowledges that timing was crucial here. He bought and grew Mercurios just as H Vac was becoming a white hot.

Will Smith (0:50)

Target for private equity.

Podcast Host (Acquiring Minds) (0:52)

But really, there is so much Jared should take credit for. He did 10x the revenue of the business over those five years from three and a half million to 35 million and 12x that half a million of SDE to over 6 million of EBITDA. So yes, there is luck here in that he could command a higher multiple.

Will Smith (1:13)

Than he might have gotten in cooler times.

Podcast Host (Acquiring Minds) (1:16)

But at $6 million of EBITDA he would have had a big eight figure exit. Whatever the multiples had been, Jared's posture going into the exit process also helped. He didn't need or want to sell, which is of course the best negotiating position from which to sell. And so how did Jared build the business over those five years? Listen for some of the key ingredients. How he devoted himself to mastering digital marketing. How he devoted himself to learning sales, including going into the field to do it. How he was present in 110% involved. He was there seven to seven every day and on many Saturdays you'll hear him say that some Saturdays when he didn't have to go to the office, he'd go just to go just to find something to work on or improve that last piece. Presence is huge.

Will Smith (2:15)

According to Jared, he subsequently acquired another.

Podcast Host (Acquiring Minds) (2:19)

Small home services business, this time through.

Will Smith (2:22)

His family office rather than as a scrappy self funded searcher with an SBA loan.

Podcast Host (Acquiring Minds) (2:28)

But it has not gone well and Jared believes that his lack of presence is a big reason why. There is much to take from this epic business buying journey with Jared Pierce, owner of Olympic Holdings Investments.

Jared Pierce (5:55)

Yep. So I like to consider myself Will, a product of the state. So I was born in Seattle, Washington and into a disadvantaged background. And what I mean by that is my mother, single mother, addicted to heroin, frequently in and out of jail. And so growing up I was in and out of foster homes and initially that was in Seattle, Washington and then we made our way from Seattle to Missoula, Montana and along the way I was in and out of a number of foster homes, I've slept on the street at a young age because we had stayed in a hotel, got kicked out, slept in a car, dumpster diving for food, behind grocery stores. So it was a very, very. At the time, when you're living it, you don't. As a young kid, 6, 7, 8 years old, it's, it's not as difficult to think about as it is as an adult, but in and out of foster homes up until the age of about 10. And that's when I was in a permanent foster home in Missoula, Montana. The interesting thing about that is when I was in Missoula, I had been spending a lot of time with my best friend and he, his mother was a lesbian or is a lesbian. And so you have, I'm black, I'm in Montana, and my, I'm spending, I'm living with my biological mom here and there. And eventually she gets in a decent amount of trouble and has to go back to prison and is going to go for an extended period of time. And so my best friend and his mother and girlfriend asked, hey, would you be interested in living with us? So I decided to move in with them in a trailer park in Missoula, which was, fortunately for me, the first time in my life where I had had some real stability from a household standpoint, albeit a non traditional household. Today people here hear this and it's, I think it's much more common. But this was 30 years ago, right? So gay marriage wasn't even legal in the state of Montana. And I think if maybe not anywhere in the country. So it was just, it was, it was different and, and, but that point of my life, living with them was one of the first times where I started to really take off and excel because I had stability within the household.

Jared Pierce (12:17)

Yep. So during my senior year of high school, my biological father reached back out and said, basically told me that he had terminal Cancer and was going to be passing away soon, prostate cancer. So I had graduated from Big sky in Missoula, Montana and I was then, then at the University of Montana. I walked on and was playing football there and had decided that I wanted to get to know more of my biological father's side of the family because I really didn't know them at all. So then I moved back to Seattle and moved in with my biological grandmother and met that part of my family in a pretty meaningful way and attended Seattle University. While I was at Seattle University, I joined an investment club that had, that was managing at the time $50,000 from a firm called DA Davidson. And we were investing it. And so as part of that relationship with DA Davidson, I got to know a number of folks at that investment firm. Coincidentally, DA Davidson is headquartered in Great Falls, Montana. So they in this, the office that I was working with was, is in Seattle, Washington. So they liked me quite a bit just given my background with Montana. So I ended up doing an internship with DA Davidson that ultimately pushed me into their investment banking group. So I did, I was intern in investment banking and then after I graduated I joined the investment banking group within DA Davidson in Seattle, Washington. That's significant because the building that we were working in there was a gentleman that I would frequently see going up and down the elevators who was a African American and black guy as well. And he worked at a private equity firm called Gen X360 that was based out of New York. His name was Art Harper. Art and I became very close and eventually Art said hey, you should think about coming to work for Gen X and, and helping us in an operational manner within our, our private equity firm. So I go to New York, I interview, they hire me and I'm at Gen X360IT that's an industrial B2B focused investment fund at the time, a $600 million fund. While I was there, there were a number of folks within the office that had gone to HBS and some of them had said hey, you should think about applying and going to Harvard free mba.

Jared Pierce (32:27)

Yeah, no, it was a great return. Great return. Right. And so, so I was using that, I knew I had that to put in as my own equity into whatever opportunity buying in terms of it evolving. I had first started out with larger companies with people saying they were interested, but as time went on, I was thinking, I was like, man, first of all, there's a lot fewer larger companies out there. Like looking for a company with 3 million of EBITDA, 4 million of EBITDA versus 500 to a million. It's, it's, you know, it's, it's, it's a fast, fast difference. Your pool of opportunities, if you look smaller, are much higher. But I had, I remember looking at a pallet company and giving them a, an LOI for $26 million. I didn't have 26. I, I didn't have anywhere. I didn't even know where I would get it. I just was just faking it till I make it. I was just, you know, just if, if we got a deal worked out, I was just going to try to find the money. Um, and it probably wouldn't have worked out and I probably would have been one of those bad stories that people hear about like I shouldn't worked with the search fund or they didn't have the money, yada yada. But then time went, as time went on and, and quickly. One thing I learned pretty quick, like I'm willing to adapt pretty quick. So, you know, started the search in October of 16, found a, closed a business in November of 2017. And along the way I am honing in and shifting where I'm no longer looking at just manufacturing businesses. I've now looked looking into home services and B2C businesses. I stayed away from things like healthcare and technology because I just felt like was too far out of my scope. But anything blue collar was not fair game. I'm driving down the road, I see a car with whatever sort of signage on it or a truck with signage on it that looks like it could be interesting. I'm writing it down, looking them up when I get home, calling them, trying to get lunch. And so the advantage I think to searching locally. I met so many people, so many business owners in the Pacific Northwest. It's probably changed now, but five years ago, I don't think anybody knew more small business owners than me. I knew so many owners by first name because I would cold call them or I would email them and just say, hey, look, whether you want to Sell or not. I think this could be a valuable meeting for both of us because at worst, we. It's two more people that know each other. And I can also tell you what people may be interested in, in your business if you do decide to sell down the road. A vast majority of business owners know they have to have an exit at some point. And so I would meet with some of them and I would say, look, you're. You're really small right now, or you're too involved in the business, or you've got too much, you know, customer concentration or whatever it is and kept in touch with a number of them. And I think that's an advantage to searching locally because business owners also know other business owners. Yeah, I had some business owners introduce me to other business owners and, and whatnot. And so.

Jared Pierce (37:42)

I only saw a business that an owner was willing to sell me at a price that I could afford to buy. Okay, that. That's. So by the. I'll jump forward a little bit and then still go back. But like, by the end of my search In October of 2017, I had two H VAC companies that I had the ability to buy and a waste. A trash compactor business as well. So. And they were all within. The one ended up buying was the one furthest away, actually. And they were all I close with, with all three owners. Met with them multiple times like a deal was going to happen. I knew for sure, certain with one of those, it was just a matter of. For me, at that point, it was like, all right, Jared, which one do I want? And I picked the H Vac one. The, The. The specific business that I picked, I picked it because the owner I felt like was least involved at that particular business. When you're. When you're meeting with owners and searching, there's certain cues, I feel like that can kind of tell you increase your probability of success of buying that. And one of them is how involved are they? Right. And I feel like when you buy a business, you also need to be prepared to step directly into that owner's shoes and in every. In every facet, so. Including how much money they're making. The trash compactor business, I really liked that business. I think initially I liked that one more than the other two. But the owner wasn't making very much money himself, and he never went on vacation, and he lived in kind of a small house. And not that that necessarily means everything, but I just was like, man, this seems like a great business. I mean, they had contracts with the airport and the, the sports stadiums, like, zero customer concentration. They go around, they service these compactors, they sell. It just seemed like. Seemed like a great business, but I was. But just something just wasn't. Wasn't working. Whereas the one that I, I did go for, he was there, you know, typically out by. By noon, did not work in the field. Had 10 acres in a little town called Gig harbor, just outside of Seattle. Nice, you know, nice house, a farm with farm animals. And, And I was like, he's doing, you know, and I'm looking on there, I'm seeing he's taking decent, decent distributions because I asked for the bank statements. I did all the diligence myself on the one end of buying. And like, man, I can see he's making. He really is making money and he. He has a pretty good life, and that's why I opted for. For that particular business.

Jared Pierce (41:15)

Yeah, I. I've met with other searchers, and it's just amazing to me when I hear about some of the businesses they're looking at buying, and I'm like, well, what's the owner doing? They're like, well, he works in the field. And I'm just like, oh, my gosh. Like. And you think. And you don't know anything about this industry. And they're like, oh, well, you know, he seems like a really good guy. And they're going to work. I'm like, dude, you can't assume any of that. You've got to make sure they have the people in place there. And so, yeah, for, for me, I don't know how to fix a furnace. And, you know, I didn't know how to do any of these. Any of these industries, any of these businesses. And so I had to be very selective and I oftentimes would pass on opportunities because I just felt like I could not fill that owner's shoes. And to your point, on. On the baseline, oftentimes people feel like I can run this business better than the old owner. And maybe that's true, but you better be prepared for you to be able to just Run it just as good as that owner and be exactly where they are. And so going back a little bit, when I would search and I'd see a vehicle and we'd dig in, we had a very consistent process for emailing. One, we had this app or widget at the time called not contact, maybe Contact Monkey or mailchimp. Monkey or something like that wasn't mailchimp. It was something that when we sent an email, we, we could see if you had opened it, if you had clicked on an attachment, if you forwarded, if it, you know, if you didn't do anything. So we had down to the. The subject line was very specific. And we had the first email that basically went out and the first paragraph was very unique. The second paragraph was like for the industry. The third paragraph was like, hey, just a quick background about who we are. And everything for Olympic holdings was at that time and was oversold. You see Olympic holdings in this email. You're like, this might be a. These guys seem pretty credible and there might be some there. Some something there. There wasn't anything there. The names on there that said they worked. There were people that were my friends. Okay. Yeah. So because I.

Jared Pierce (48:55)

Yep, and I go for Mercurios relative to the other H Vac business, because Mercurio's was essentially all B2C, so it was. It was just a little bit more simple. Whereas the other H Vac business was about 50, 50 commercial and B2B and then B2C, the other, you know, residential for the other 50%. And on the commercial side, you know, I'm in his office, there's these plans, and they're, you know, it's just like drawings, and it just looked like a lot. And I'm like, man, I'm like, so who kind of like, who, who. Who checks to make sure this is all right? He's like, oh, well, you know, I'll look over everything. And I'm just like, yeah, I can't do that. Like, I'm not going to look at these. At these drawns and make sure that the airflow is going right and there's enough CFM and blah, blah, blah, blah, like. And so then I opted for the. The. The more simple of the two ATC business, interestingly, Enough. I almost bought that business a couple of years later, but it was. I just felt like it was still a little too early for my first add on. So the business that I buy is Mercurio's and when I purchase it, it has 15 employees, 16 if you count the old owner. But it's fairly. There was really no single point of failure within that company from an employee standpoint, which I like. They had two sales guys, so I had to have both walk out the door. They had two install crews, so I had to have. With a foreman on the top. So I had to have both walk out the door for that to go sideways as well. They had five service techs and so it was just a little bit. I felt like there was. The owner wasn't working in the field. And so I felt like, okay, this is a business that I have to really go in and screw this up or get multiple people to run out the door within the same department for us to not have some. For us to have an apartment go away, if you will. It had been around since 93, so it had been around for about whatever that is, 25 years when I bought it. And the owner was a little bit older. He was, you know, call it 60ish. Just under. His engage was like 59. And so I was like, okay, he's. It's not like this is one other thing. I. I tend to look for wills. I don't like to really buy businesses from people that are too young because I. It's kind of like, well, why are you selling it?

Jared Pierce (53:20)

And so, and it's one of those things, looking back, people always say, well, don't worry about the money, don't worry about the money. Or how do you not worry about the money? But looking back on it, it's like if you. It wasn't, I wanted money, but it was really like the driving force was protecting the business, making sure the mothership could stay afloat, you know, in any sort of storm. And so with that, what that meant for me was I like invested a lot into marketing because I wanted to get the word of mouth out there and I controlled all of the marketing. So I worked with Google and Microsoft and Facebook and they all have teams in house that will help you run your campaigns and we'll tell you, do you want to try this? Do you want to try that? And so what that did for me was two things. One, we had essentially zero agency costs. Like I didn't build our new website, but it was built on Squarespace and I would make changes to the website, but all of our ad spend, 100% of it went to the ads. So if we spent 5,000 bucks a month in Facebook social media ads, all of it went there. That, that I feel like will save a company 10 to 20% of their marketing spend. Because I think agencies typically take around 10 to 20% of your spend is, is my understanding of how they will work. So one more of our dollars went, more of our marketing dollars went to marketing. And then coming from outside the industry, everything that we put out I obviously had, I approved it all. And so for me it was like, well, I felt like if it makes sense to me who didn't really know much about this industry, then it might make sense to somebody like you will, that doesn't know a lot about H Vac as well. And so that was a big component of it. And then I, I early on learned sales as well. We had a sales guy that wasn't performing well. I go to the owner, the old owner, and I said, hey, he's not doing well. Would you teach me how to do H Vac sales? And by now, by that time, him and I had had a pretty good relationship because I really was. 7am I'm there. I was 7 to 7. 7am to 7pm I was generally one of the first people there and generally one of the last. Unless a crew was working late on a job and they, you know, they got back at like eight or something. But for the most part, I was there all the time. And it. So that bought me a lot of respect from not just the team members, but the old owner. So a lot of people at that company were willing to invest and help teach me. If folks needed something on a job site, I'd run them out on the job site. So when I asked the owner about teaching me how to do sales, he said, sure. So for like the next 30, 60 days, half the sales calls that came in, him and I would go on and we'd go together and he would teach me about the ductwork and airflow and he'd like, you know, look at these. Count these registers, open these up. Here's how you size up windows. Here's how you do a load calc on the house. And so reading the nomenclature on a, on a furnace, air conditioner, heat pump, I can look at it. I could come to your house right now, Will, and I could sell you a system. Like, did they. I could size up your house, be like, here's exactly how much airflow you need. So that's how much I leaned in. So you take that, you couple it with the marketing and just things started to come together for us. Where.

Jared Pierce (69:05)

Yeah, I mean I, I, I feel like, I, I feel like I get it as well as anybody, especially I mean Google, Google in particular, they want you to be successful. So when they're, when their reps call you, they're saying, hey, do you want to try this ad? I was like sure, I'll try it. It was this dynamic search style ad. There's a best performing ad. I was like, yeah, that's great, let's spend more on that. You know, and I'm not as sophisticated as these other folks, but. And they're like, yeah, no, it's working well. I was like, yeah, I'll try it. So whenever they ask me to try something, I always try it with them just to see because they want it to be successful, you know, and, and I, I find that, that, that, that, that worked for us. So in terms of other inflection points. So obviously Covid hits and that has a meaningful impact on our business. Fortunate where we had to start stocking inventory. A lot of dealers in the space, contractors had to start stocking inventory within H vac because you couldn't get anything from the distributor and manufacturers. Fortunately for me, I knew since I had been doing sales, I knew all the products. So I, we, we, we at one point had a million bucks of inventory. Mind you, we, when I bought it, you couldn't find. We never had a furnace in our warehouse because our distributor, we'd buy from our distributor. We as long as you place the order the night before, we always got it the next day. So we never stocked equipment. We had supplies, we had capacitors, whatever, but we never had furnaces, air conditioners, Ducklet, none of that. But by the when Covid hits, we have to ramp all that stuff up. And so I'm stocking it all. I know what to stock, blah, blah, blah. But that was a big inflection point for us in the sense that the work from home and the tailwinds that that would provide for a home services company were meaningful for us. Just the pull forward of everybody wanting conditioned space in areas that may not have been conditioned before was a big benefit. And then we had grown to a size 2 where we were probably at like 75 employees at this time. Within. I then make a small acquisition of an electrical company. I then acquire another H vac company about 30 miles south. That was 7ish million, 6 million in sales. Acquired a $3 million H vac company about 30 miles north. So we were kind of in this triangle. And next thing I know, we're doing 35 million in sales and almost 7 million of EBITDA, just short of 7 million of EBITDA. So the COVID was beneficial to us. And then picking up these other acquisitions, which will to my benefit. Having a background in private equity investment banking made me comfortable and with doing that. And then when I met with owners, they. I knew that I was almost one of them. You know, I was never going to fully be one of them because I. I didn't start the company. But we could talk. You want to talk brand, you want to talk systems? Oh, yeah, that, that's. We're having a lot of issues with that. Hmh. And they're like, so are we. And I'm like, yeah, I know it's a problem. I mean, blah, blah, blah. And so I could get meetings. I mean, once you. Once you're in the industry and you want to talk to an owner and where we had grown, they took my call. All of them. Sure, sure. And one other big point for us on marketing was we. Our TV commercial, we partnered with the utility companies. So in. In Tacoma, in the Seattle area, there's Puget Sound Energy, and then there's Tacoma Public Utilities, Tacoma Power down in our core Pierce county area. We got them to go on TV with us and say we work with Mercurios in the amount of credibility that that gave us, that we do rebates. Like, we leaned in really heavy on rebates was enormous. So people then looked at Mercurios, looked at our company and said, I see them on TV with Tacoma Power and Tacoma Power is saying this is a great contractor and they can help you with your utility rebates or your utility loans, et cetera. We leaned and got, got basically in bed with these guys and that created a lot of credibility for us as well.

Jared Pierce (100:10)

Yeah. So I, I, you know, and they're still young, but you know, my, my daughter, my oldest one has said like before, like, oh, you know, are, are we, are we rich? You know, and I'm in some networking groups that have for like high net worth individuals where we talk about things like this and like, how do you have conversations with your kids and at various ages? And so, you know, right now our response is like, well, you know, rich could mean a lot of things. What we, we have what we need. Right. And that's what we're rich in that capacity that we can have what we need. And so as, as time goes on, it's, it's hopefully trying to create a grounded environment for them. But I don't know exactly what that will mean until I see it. I can tell you, like growing up, how I grew Up. And when I see the girls act a particular way, like, I. I will make like, you guys want to do anything here. You're going. You're going to clean up this living room. This is not for the. The housekeepers to come in and just be constantly picking up after you guys. So I don't have a problem having that conversation with them if they want anything, if they want a snack or they want a dessert. Dessert or they want to watch a movie time. This room better be clean. And so my hope is just teaching them little things like that on, like, working. And my daughter has. They both do now have a. Have a. Like a kind of like a piggy bank. But it's like a third of it is spend, a third of it is share, and a third of it is save. And I tell them, I'm like, if you put money in the save one, then it will grow and you'll get more money. And the only way it grows right now is I go and I put another dollar or two in it every so often when I think about it. And then we get to go buy something. And so my daughter at one point was like, well, how do I get more in there? I'm like, well, you've got to sell. Like, if you sell, sell. Like, if you make art, I will buy your art. So my daughter, sometimes she's like, makes me a picture, and I buy it from her for a couple of dollars, and she puts it in her piggy bank. And, you know, next thing you know, she's looking in there, and I'm like, well, how many dollars do you have in there now? And she has eight. And then a week later, she might have 10. And she's like, it grew. And I'm like, that's what happens when you save. You save. And it grows. It's a very simple approach to it. And then we go to the store and I let her take out the money and she hands it to them. And I'm like, now make sure, because you can spend all your money on this, you're not going to have any more left, or you can spend some. And so, you know, we doing these in a very elementary way, we have some of these conversations that I'm just trying to get her to understand the concept of money and savings.

Jared Pierce (103:43)

Yeah. Okay, great. So I. We tend to buy, we tend to still want to buy smaller companies from a. A risk standpoint. Like we don't really want more than like a couple million bucks of equity tied up in any one deal because right now any one of our investments could, we could lose and we would not be happy about it. But it wouldn't, it wouldn't change our day to day life. So we do have kind of a hard cap. Like we're not putting more than 3 million of equity into anything just from. Just so we don't have to. I don't want anything keeping me up at night. I go and I put 20 million bucks into something, it's going to be too meaningful to me and I just don't want that kind of stress. So my general manager at Mercurios and I, who we've worked together with for. I've worked with him longer than anybody else I've ever worked with now. And he was at Mercurials when I bought it. The buyers decided they wanted to move in a. Mercurials buyers decided they wanted to move in a different direction from him. And so we, him and I were having a conversation that's like, well, we can't buy anything in H Vac because he's not compete and I can't. He, he, he more likely could. I can't. H Vac plumbing off limits, not happening. But we were like, well, let's look at some other industries. And so we got to thinking around about some other home services industries. Roofing, windows and doors, Lancy landscaping, yard, you know, whatever. And so we, we had come across a business in the window and door space 10 minutes from where Mercurios is. Been around for, since 85, so been around for 40 years. And we're like, oh, this thing, this seems like A a slam dunk. A third of the, it's called South Tacoma Glass. We've rebranded it ST Glass and window specialist. A third of that business is automotive glass. So think safe, light. And then two thirds of the business is window replacement in the residential space, some multifamily as well. So like a renewal by Anderson or Champion Windows, if anybody's familiar with those, then we're like, well that's, that's B2C residential. Like we're going to, we're going to understand that completely. And the business was doing over 6 million in sales when we bought. Has been nothing but a nightmare from the, the day that we bought it, the day that the sellers announced to their team two of their better installers quit that day. We hadn't even said anything, mind you, when I had bought Mercurios, nobody left for the first six months. Nobody just. And actually of all the businesses I bought, nobody's ever quit on day one like that. Nobody's ever really quit shortly thereafter because of a transition. In this case, I mean, it's looking back on it, it would only have happened at this business. So we're on a run rate now of probably like 4 million in sales. So we're down pretty heavy. I'm not making any money on that business. The gm, my, my partner from Mercurios who partnered with me on it, we're 50, 50 on it and he's running it day to day. He's making a little bit, but not much. Fortunately, we're both being paid by our old company, by Mercurios to, we've got some licenses and stuff that they need and so we're still getting some, some compensation there. But in his case he's, he's making substantially less money than he would have made before. And an industry that we thought would be very easy to walk into has been different. And, and if we weren't in the position that we're in, we probably would have failed. Like, I, I, I think that most other buyers, if they would have bought this and didn't have the financial means, one month, I just for, I'm, I'm everything in this business too. Well, like I'm, I'm the debt, I'm half the equity, right? So if I don't want to, early on with this, I was like, you know what? We're just not even going to make this loan payment. It's, it's just going to me anyways. But like we're not going to make it because it's just losing it was just losing money. We walked into a business and we should have seen was losing money when we bought it.

Jared Pierce (110:36)

And we went to the sellers just before we closed and said, hey, we need to, we need to talk about the valuation. We need to talk about some comp. And they left a few, a few hundred grand in the business for us. We left, we put in a few hundred grand. And so that's kind of helped us weather this storm. But we've had to make some drastic changes. And I think, like, you know, not to be egotistic about it. We. And we know what we're doing in this space, right? Like Hank, my gm, he knows how to, you know, operate and run a company. But there was just so much heavy lifting to do that we didn't realize that it's. It almost took us a year. So, like, what we are doing now, Will, is what we thought we would be doing when we bought the company. We just now are producing a TV commercial. Just now, we thought we were going to be producing a TV commercial in November of last year. Instead, we're sitting here having to, like, lay this person off, replace them with that person. We thought, here's a specific example of not doing proper diligence. I asked them, oh, what, what operating software do you guys use? They said, we use this. This program called Main Street. Like, okay. And they're like, what do you guys do there? Oh, this is, this is the system we use to process customer invoices and whatnot. Okay, what's your account in software? QuickBooks. Okay, great. I assumed that all these systems talked. Just assumed. No, what we walked. What we walked into is. So this system, Main street, they weren't even using it in its full capacity. So it didn't do any scheduling. They're doing the scheduling on, on. On, like, paper. I just assumed it was happening in their CRM. When they go to process a payment, I just assume the CRM process because that's what I was familiar with. No, when they're, when they, when they want to take a payment, they have to use this other system called Clover to process the payment. Like, okay, well, I'm like, well, how's it, how's this get into QuickBooks? Oh, we have to manually enter everything. So then they're taking. And, you know, they're manually entering things and supposed to be 59, instead it's 95 gets entered in. And so they have to. Man, they were manually entering in from Clover to Main street, from Main street to QuickBooks. I mean, in the amount of time that was taking was like their accountants, you know, it was taking that person multiple hours a day. So we've swapped that out with the system we used before. I had to beg the company to come into this new industry because Service Titan hadn't done much in Windows and Doors. And now they all talk. But the first few months was, you know, onboarding a new CRM because we were like, well, where's the scheduling? And we couldn't see it and it's on some guy's desk in the back and we're like, we don't even know if we made any money today. We don't even know what job. We don't even know where the guys are at.

Jared Pierce (116:18)

I. I think it is making me a little soft. The other big piece is I'm not. I'm not involved nearly as much as I was before. So at Mercurios, I was there every day. And I'm not exaggerating, Will. Every day. Like on the weekends, I was going down there. Two to three Saturdays a month, I would go down there. No plan in mind, just. I'm just gonna be here and just see what I see and just work on whatever I want to work on around the warehouse. And now I'm in Texas, and this business I have is in Washington state in Tacoma. So I'm not there nearly as much. If I were there more, more change would have happened more quickly for the better and not knocking my business partner on it, but he's, you know, he's on an island there by himself. And I tend to when I'm there and I hear a CSR on a. On a phone call, as soon as she gets off, I'll go out there and talk to her about it and be like, hey, you know that I like what you said, but, like, next time, let's definitely try to see if we can squeeze them in quicker. Right. Like, the. The culture, there was a real lack of urgency, whereas I tend to be like, now, now, now, now, now. And so me not being present, I think has all the same issues would be there, but we haven't been able to address them as quickly because I'm. I'm not there as much. Right. I thought I was going to be there this past summer a lot more, but one of our daughters had a health issue going on, so we decided just to stay in Houston because we still have a place in Seattle and it's just sitting there. So we thought we'd be up there for the summer and I would be there every day and tackle a lot of things that's now going to be pushed to next summer. So I was gonna say, to your point of, like, being soft, I don't have to. Right. Like before, I had to. Before Mercurials had to be successful. If this isn't successful. It sucks and I'm not happy about it, but I'm willing to wait till next summer. Like, it's not urgent enough, it's not meaningful enough for me to grab the girls and say, let's, let's go, let's go spend. I mean, probably really like 90 days, six months of like true undivided attention would probably just really get a lot of the processes in place. But instead I told the mindset, I'll just do it next summer. The business will survive because at worst I just won't make a pay. It's debt payments to me and it's, it'll be fine. It'll go. So we'll be fine. But it's. Right, it's, it's harder. It's hard.

Jared Pierce (119:41)

Well, yeah, and we're, we're more experienced and we know this. Yeah. We know the systems, we know the processes that work well and the ones that don't work well. Right. But for a searcher, there's two things. One, there's always going to be a component of like luck in whatever you're doing in that part you can't control. Right. Whether it's the right timing that you've bought in a particular industry or that you sell or whatever sort of dynamics might be going. There's things going to be outside of your control and that. And that is what it is. But the biggest thing that I cannot stress enough is if you are going to buy a company, you have to be present. Like, you have to be there and fully invested and committed to its success more than anybody else. And with Mercurios, I was, that I, I, I was all in. And it, that was an investment. That was an investment of my time and my energy. And there was other things that I didn't get to do. I didn't get to, I wasn't going to the lake every Saturday. You know, I wasn't doing all the fun Stuff that the folks are doing for me. In the evenings, we'd be watching a movie, I'd have my laptop on my lap. I'm looking at our website, I'm looking, I'm Google searching competitors, I'm doing whatever. You just become obsessed with it, right? Like I became obsessed with Mercurials and was all in and it, and it benefited and I mean, it's, the business is not doing well right now. If I were there and like the team were there, it would, we would be fine. Like, we wouldn't be growing on a rocket ship, but we would, we would be, we would all be happy because we were all committed. And with, with this business, not only am I not there, my business partner is not there as much as he was at Mercurials either. And yet he owns more of this. But again, he did well when I sold too. I, I, you know, I took care, it took care of them in a meaningful way. So, and I've been talking about that. I've been saying, hey, you know, you need to be more present. Like, you've got to be more present here. We've got to be here to work, to help. Just, there's always something. There's never a day what I would tell somebody if you have a business, there's never a day that it can't benefit from you being there. Just go in there and just go into the CRM, go into the accounting software, going to the warehouse, see something and just look to make it better, one thing at a time. And next thing you know, you're going to look, you know, you're going to look back and a year is going to have passed and it's going to be substantially better. And that's the difference. And that's why we're, we're struggling with this. And it's taking longer and it's been harder because we haven't been as invested.