← Owned and Operated - A Plumbing, Electrical, and HVAC Business Growth Podcast
Owned and Operated - A Plumbing, Electrical, and HVAC Business Growth Podcast
#159 - Turning Data into Dollars: How to Use AI in The Trades with Sebastian Jimenez
00:47:42
Loading summary
Transcript67 lines
- [00:00]
Sebastian
Home improvement contractors are the early adopters of AI technology. Now we've become one of the fastest growing startups right now and ever. This is a really exciting time to be in the trades. If you're doing physical ride alongs, that's when Rilla is going to provide significant ROI from day one.
- [00:26]
John Wilson
Recently I checked out Field Pulse as a field management software for our restoration business and honestly I was pretty impressed. The big wins that we saw was it's got two way sync with QuickBooks online and desktop. It's got some really good dashboards and reporting, it's got custom workflows and this is probably one of their most unique features. It does have CRM and it has.
- [00:46]
Co-host
A lot of the other things that.
- [00:46]
John Wilson
You'D expect out of a field service management software. You're going to have financing and payments, you're going to have customer booking portals, project management tools, price book, work order management estimates and invoices. But where they really shine is the scheduling dispatch, custom workflows and the dashboards and reporting. It automated and streamlined our operation and gave us a bunch of easy tools for scheduling and dispatching our team. And we loved the workflows feature. Make sure you mention owned and operated for a special offer. 15% off the annual plan.
- [01:16]
Host
Welcome back to Owned and Operated. Today we have your co host John Wilson and Sebastian from rilla. How's it going, Sebastian?
- [01:29]
Sebastian
How's it going, guys? Thank you so much for having me here. I've seen a couple of, I've seen a couple of your highlight reels on LinkedIn and so very excited to be here.
- [01:37]
Co-host
So, yeah, yeah, us just pleasing the, us pleasing the LinkedIn gods algorithm. LinkedIn's been a real. Yeah, it's kind of odd. We started, Sebastian, we started this sharing through Twitter which is like a totally different vibe than LinkedIn. So we're just getting into LinkedIn and it's weird, man. LinkedIn's weird. I don't know, it's a weird group of people.
- [02:06]
Sebastian
I've been on LinkedIn for so long because I've been doing B2B sales like for SaaS for so long. But yeah, so I actually met my fiance who's gonna be my wife. I met her on LinkedIn literally because I didn't have an Instagram and her friend who introduced us, she was like, you need to hit her up on Instagram. I was like, I don't use that, dude. I do B2B SaaS sales. I met my, my, my, my Future Wife on LinkedIn. So look at that. Thank you, LinkedIn.
- [02:27]
Co-host
Oh my God. Yeah. That's hilarious. Cool. Well, what I'd like to start off the show with like, hey, what? One, what's Rilla? And then two, can you give us a little bit of the background? And then we'll dive into what do the best users of this platform do? What are they? What do they look like? How do they, how do they maximize their revenue and their closing rate? So what's Rila? How to start?
- [02:52]
Sebastian
Yeah. So Rilla, we are the leading virtual ride along software for the home improvement industry. So what that means is when salespeople, technicians, design consultants go out and talk to customers in the home, they record their conversations on the Rilla app from the phones and tablets. And then we use AI to analyze, to transcribe, analyze and give them feedback to help them improve their sales and to help their coaches, their service managers, their sales managers do what we call virtual ride alongs that are 100 times faster, better, more productive. And so, you know, before Rila, sales managers, you would have to go out on a ride along. It takes four hours to coach one person. With Rila in, you could do a virtual ride along in three minutes. So in the same amount of time, you could do a hundred times more coaching. And so that's what people with Rila do. And I'm happy to talk about some of the interesting use cases that we've seen. And how did it start? Oh, and before that. So the reason we say leading is because we started selling this product in January 2022. We went from zero to over 1500 contractors in a little over two years. And we're talking about some of the top contractors in the country, Some of the guests in your show who use Rilla, Tommy Mello From A1 garage, we have Groundworks who uses Rila. So if you look at the top private equity customers in the, we probably have a monopoly of that already. And then we have like tens of thousands of technicians and millions and billions of conversations being recorded. And so this is now it's a growth story. Everybody's happy, excited. Woo. Yeah, Rilla. But it didn't start like that, as you can imagine, you know, being in business. So how did Rilla start? So first of all, my trade is not in software. I am not a software person. I don't know how to code. I am a former stand up comedian. So I used to do stand up comedy in college for four years. And that's where I got my addiction to trying things out and failing very quickly and learning from the failure and using it as a way to build your craft and creating something awesome. That's what you do in standup. You go out and you try a joke and you bomb and you figure out why you bombed. And even the best jokes start as bad jokes that are not well executed. And then you figure out the execution by a lot of trial and error. And then you create a really great set. I got addicted to that. And that addiction took me to building tech products. When I graduated college, I started my first tech company. It was a field marketing management software. So like home service businesses, they use field service management software. Mine was a field marketing management software for companies like Red Bull and Heineken and Molson Course that do field marketing. Like, you know when you send the college kids with uniforms to the college campuses to give people Red Bull and stuff like that, like the wing teams and so on.
- [05:30]
Co-host
So this is like a sales rab type thing or like what?
- [05:33]
Sebastian
Yes, yes, Literally like a sales rabbit. So sales rabbit's like a door knocking tool. This one was more like a field marketing. So people who have a booth at a music festival, you want to plan the event, you want to take pictures from the booth, you want to schedule and pay the brand ambassador. It's like an all in one kind of software to manage these gig worker brand ambassador types, right? Which is, which is kind of, it has like all its nuances and stuff like that, but it's one of these SaaS products that, that gets used to manage a particular use case or a particular ve. And from this software, the big aha moment for me, for Rilla, came when I was talking to the field marketing manager at Heineken. And I realized that Heineken had 4 million face to face conversations with consumers every single month from these field marketing activations. And they were spending about $100 million a year on social media analytics, surveys, focus groups, and market research from Qualtrics and Nielsen and Kantar, IRI and Sprinklr. And they were only getting 500,000 data points from consumers every single month from online channels. And I thought, if Heineken has eight times more data offline, who else fits this profile? And then I realized that it's not only Heineken, it's. It's Molson, Coors and Coca Cola. 85% of commerce happens offline. Heineken not only has field marketeers, they have field salespeople that go into the stores and the restaurants. And so I thought, why stop at food and beverage? What about the people who sell windows siding flooring Doors, H vac, plumbing, electrical, roofing, solar. What about the people who sell in retail stores? And I realized that there's 12 million outside sales and service people and they have about 10 billion face to face conversations with consumers every month. And if we could go out there and capture these 10 billion conversations, we could probably create something like Google. We could probably make offline commerce as searchable and indexable as Google did for the web. And that became the vision for Rilla. We called it Rilla because it comes from guerrilla marketing, from field marketing. And that was 2019 and that was the vision. It never changed. It's still the same vision today. It's still the same. We changed a little bit the way to get there. But for three years, essentially from 2019 to 2022, I like to say that our first three years of business was just us going out of business. We made $0, no money. We were in the red. We're trying to figure out this AI product, trying to figure out the right market, the right use case. And then finally in January 2022 we found the home improvement industry. This virtual ride along use case that was so powerful for home improvement companies that really care about coaching and training their people. And that's when it really just took the hell off. And so like I said, now we've become one of the fastest growing startups right now ever because of this industry that we found in home improvement.
- [08:18]
Co-host
Yeah, yeah, that's wild. What's the team size of Rilla and like how fast has it moved?
- [08:25]
Sebastian
Yeah, so to give you an idea, so Rila Rilla was still a very small team. We're only 50 people, which is something that makes Rilla uniquely different. I think this is happening more and more with AI companies that the team sizes are very small. But to give you an idea, and this has been, this hasn't been done a lot of times before, the only comparable teams that are very small with this kind of traction is like Instagram and WhatsApp. It's like very small teams that produce insane. Like Instagram was like 17 people when they got acquired for a billion dollars by Facebook. WhatsApp, similar thing, but really started, we went from 0 to 1.4 million ARR. First year of sales we went from 1.4 million to 10.6 million are our second year of sales this year. I don't want to say what we're going to end, but it's like, you know, still like, like, you know, in that, you know, we 10x last year we're going to do something, you know, not, not quite 10x but you know, getting up there. And if you look at the historical record of startups, just the first two years alone and even the third year, I think we're the. If depending on where we end this year, we're going to be the 5th or 6th fastest growing SaaS startup of all time. And that puts us ahead of companies like Apple. It puts us ahead of companies like Salesforce or Salesforce went from like 1 to 5 million in their second year and then 5 million to 20 million in their third year. So we're growing faster than Salesforce, we're growing faster than Apple, we're growing faster than Figma, than some of the fastest growing startups ever. I think we're like literally like number five or six on the historical leaderboard and I think we might be the fastest growing startup of all time right now. Right now. And there's another one called Perplexity which might be growing at a similar rate to Rilla. What is between us and Perplexity?
- [10:07]
Co-host
So yeah, that's fascinating.
- [10:09]
Sebastian
Very small, Very, very small team. Very unique.
- [10:12]
Co-host
That's awesome.
- [10:12]
Sebastian
Yeah. Well, congratulations to our customers because if they weren't growing so quickly, we wouldn't be growing so quickly. So thank you Uncle Tommy Mello for growing so much and Aaron Gaynor and all you guys.
- [10:25]
Co-host
So yeah, yeah, that's funny. Yeah, walk us through. Let's dive into a couple of these customers because I think what we want to understand and probably what the audience wants to understand is like what does best in class look like? So okay, we're all being told that hey, this expensive ride along software is going to change the world for us. Right? And maybe it will, but like how do you drive it into the business? What do the best do to maximize this investment and how are people winning?
- [11:03]
Sebastian
Yeah, so great question. So I'll talk about one of the best implementations I've ever seen was LB Capital with Lance Backman and Bill Rossell. They're basically a large roofing company. They acquire a lot of roofing companies as well. Lance used to be the, he was the founder of one SEO, he sold that and he's involved with a lot of the top businesses in the country. And so one of the things that we saw that they did really well is that first of all, like it depends on the stage. Right. But when you're onboarding Rila, the biggest thing at the beginning is making sure you get the rep buy in, that you get buy in from the technicians and the, and the salespeople in the field. So how do you do that effectively? You could do it the soft way, which we do all the time for the average customer, where we go and say like, hey, listen, we pitch it to the technicians in a different way. The salespeople, the technicians, we say like, hey, this is a protection tool for you. Like the way we pitch it to them, we go like, hey, guys. And this we learned after like literally like thousands of times that we launched with people. But it was like we used to pitch it to technicians as a sales tool. But the technicians are not as sales driven as the salespeople. In fact, they, a lot of them don't like the word sales, which is its own problem, but that's the reality. And so the way we started pitching it to technicians over, over the years was, hey, guys, who here has ever had a situation with a homeowner where the homeowner said you did something wrong? Everybody raises their hand. And who here has had a situation where the homeowner said you did something wrong, but they were lying? And they all raised their hand, they're like, yeah, they were lying. And then you go, bob, what happened to you last week? And he goes, I went out there, I sold my thing. I did everything right. The homeowner said that, you know, it was like, we got this case recently was like, oh, the daughter called and said that it was elder abuse because I sold the mom that, her mom like some H vac unit that she didn't need. And it was such like, crap. And I said, what happened to you? Well, I lost the sale, I lost the commission. I, I got a write up because it was. He said, she said. And I said, bob, how would you have protected yourself in that situation? Well, I would have been great to have a recording. And I'm like, that's right, Bob. You would need a recording device. And that's what really is. And it's a way to protect yourself. And so that's how we pitch it to technicians for salespeople. And the way that we've seen the top companies do this, they don't go the soft route. So I'm thinking of LB Capital, I'm thinking of FH for Lance Bachman. And Bill Russell. They basically set a cultural standard. They said, guys, we're going to do this. This is going to be a tool for your improvement. You are going to get better at selling. This is, this is an AI coach in your pocket. And sorry to say, but if you don't want to use this, you cannot work here. And they make the standard. Like, that is super, like, on the other extreme of like, hey, this is not soft, or we're trying to pitch it to you. It's like, no, no, no. We're going to do this no matter what. And usually when you launch real out, your top performers are actually the most resistant to the change. They do not want to be recorded. They are the top performers. So they say, why the hell do I need this coaching? Why the hell do I need this? You know, AI recording me. I already know what I'm doing. And the top performers are very resistant. And so there was one top performer at Lance's company who said that he didn't want to get on it. And Lance literally went up to him a week in, and Lance said, like, hey, listen, man, thank you for your service, but, you know, we're gonna have to let you go. And the guy was like, what? I'm like, one of your top guys. He's like, yeah, Bill's trying to implement this tool, and you're not buying in, and it's making other people not buy in, and you're not being a leader. So I can't have you work at this company anymore. And the guy's like, are you serious? Yeah, I'm going to have to walk you out. And he did that, and he's like, no, no, no, dude, I'm going to get on. I'm going to get on. I'm sorry. So he was like, more like, listen, we're going to do this no matter what. And those are the best. The companies that see the fast distraction is not the ones that go the software. It's the ones that say, this is a standard. This is the. This is just what we're going to be doing in the company. That's not how we do it with most people, because most people are not willing to go there. But again, the few people that are willing to go, they get the buy in. Then what do you do once you've implemented? Because that's the biggest challenge once you implement it with your reps, with your technicians. I'm thinking of any hour how they did an amazing implementation. They got buy in. Any hour. They. They literally. They did it so good, they didn't even say it as, like, a thread or anything like that. Any hour. Literally rented a movie theater before we launched Rilla, and they played the movie Moneyball to all of their salespeople. And, like, they literally had their top performers volunteering to use Rila the next day because they did like a whole, like, roadshow to launch. It's like one of the best things that we've ever seen. Like, truly for this, it wasn't like, oh, get in or else. It was like, who wants it? And people were fighting to get in because they were like, I want that, I want to get the data, I want to get the analytics. And so once you implement it, what we've seen from, from companies that truly leverage the power of the technology. At the beginning, we thought that Rilla was a way to save time doing ride alongs, increase efficiency and basically improve your sales. So we would look at how many ride alongs can you do, how fast? One thing we didn't consider is that Rila enables this different kind of workflow in a company because of the flexibility of coaching. One of the superpowers of the virtual ride along is that it allows you to coach from anywhere. You don't have to be there physically present to coach the person. So it's not about saving time and efficiency. It's actually about the flexibility that I can coach from my office, from my car, from sitting in the toilet. So. So we literally have coaches and companies who have leveraged this superpower. And they said, guys, we no longer need to have coaches in person. So if you have a big private equity company, what they started doing is they started having coaching centers from the corporate standpoint that are able to coach the entire market. So if you need coaching resources in Florida, then instead of having to send people down to Florida and pay all these flights and stuff like that, you could just have the corporate coaches coach in Florida, like at the speed of light. And the best companies are literally rebuilding their businesses around this new technology by having this new kind of. There's a company called Brookstone Windows. They one of their positions that they have, it's like called Grilla specialist and their job is a remote coach who coaches all the reps from a single. And these coaches manage anywhere from 30 to 100 reps each because they can do so many ride along. So. So it's like they created this new kind of position. The virtual sales coach or the virtual sales trainer is an amazing kind of finding.
- [17:21]
Co-host
It is amazing for the companies that are doing that. Like what happens? Because I think typically the way these get pitched is the service manager's doing it, right? So like what happens with the service manager side of that position? Does he just take on more text because there's less responsibility or like what, what happens?
- [17:41]
Sebastian
So it's like we have a. We have a. We have a. It depends, right? There's a joker, Serra, who's one of the great coaches in home services. Uncle Joe, who's a great friend of the company. He's going to be doing a talk at the Rilla Masters. We have our conference, the Rilla Masters, coming up on February 24th for anybody who's listening. February 24th, at the Virgin Hotels Las Vegas. But Joe is going to be doing a talk there. It's titled so long the Manager, Long Lived the Coach. And the whole point of the talk is how the service manager's day should be less about doing all these, like, putting out fires and, and doing all this paperwork and figuring and like approving pricing and getting calls from the technicians, like, and being interrupted every single five seconds. And the service manager's day should look more like what the day looks like for a professional sports coach. A professional sports coach spends 80% of their time reviewing game films, and that's 20% of the remaining time meeting in training meetings with their players to unpack what they figured out from the game film so that they can improve. And so right now, if you look at rilla, service managers still use Rilla, but they only use it for like an hour a day. So it's not 80% of their time. The trainer and the coaches, they spend 80% of their time on Rilla. So, so sometimes when you have Rilla, yes, you can have your service managers, you said you have different levels, different difficulties of the game, as we call it, where you could just use it for five, 10 minutes. That's what service managers use it, one hour. Then you have the coaches like Sylvia. Sylvia was the, is the training manager at my plumber. Plus she manages by herself a team of 40 technicians. Right. Because Rila allows her to do that now. So what companies do is they. Now they raise up the trainer to do all the training. And then the service manager is more like the frontline kind of support for the rep. And they actually help improve the sale on the spot. Like they do more the callback call management. But the trainer takes care of making sure that the technicians are actually improving over time without having. Instead of like putting, putting band aids, they're actually giving you the medicine and the vitamins that you need to actually get better over time on your own so that the fires actually go down as a result over time. But. And we see companies do it differently, like Momentum Solar, one of our customers, they also did the same thing where they literally took their managers and some other half of their managers. They said, you guys are going to go back out on the field because they're basically salespeople that got into a management position. They said, you guys are going to go back out on the field. And then half of the managers, they said, you guys are going to be trainers. And they became the foundation for this corporate training program that they had where the. Because and then now they need half of the managers because the managers are 100 times more productive. And so, so you see companies use this wealth creation in different ways, but it's mostly raising up this new position of the coach like people and it's almost like changing the, the skill set that you need in order to be a manager. You have to be a great coach. Now you can't just be like somebody who's putting out a lot of fires. You have to be a great coach.
- [20:40]
Host
So, and so what, what is, what are the big items that they're coaching on? What are, what are the findings that are coming from all these hours of, of recordings? What is there any kind of trend that we're seeing across the board in terms of how, how we can get our teams better by coaching?
- [21:00]
Sebastian
Yeah. So this is one of the cool things. This is another one of the kind of ancillary benefits that we discovered with Rilla. We did not expect that we were going to do this, but because of what we've done and the growth that we've had, we've been fortunate enough that we've. Last time I checked, it was actually April this year or March. At the time we had like 2 million face to face conversations recorded in the home between technicians and salespeople and homeowners. So it's like multiple millions now, at least. So the. So because we have so many conversations, so many recordings and we've transcribed and analyzed them and we've turned them into data, we can do this thing for the first time ever, which is called Moneyball for sales. So Billy Beane, who's also going to be speaking at the Rail Masters, was a manager of the Oakland Ace team of baseball. He invented this concept of Moneyball, which is you look at data, you look at the inputs of any sport and you try to predict how you can actually improve your chances of winning by using data, science and analytics to use in your coaching and your recruiting and your way that you manage your teams. And so with Rilla, because we've turned these conversations, the inputs of the game of sales into data, we could do the exact same thing for, for the sport of sales. And so one of the things that we've done is we've, we and we publish this in the real. It's, it's called the Rilla labs. You go to rilla.com labs and we publish all of our reports there. We look at what is it that the top 1% of top performers across the country, across the trades, what is it that they're doing differently than everybody else? And so that we could actually show, you know, how you could be more like a top performer. One of the first things that we ever found that it's literally in the V product, it's one of the main metrics that we show there, that one of the main differences between the top 1% of top performers, these are people who are closing 5 million, 7 million, 8 million and 13 million dollars of annual sales for their business single handedly every single year. Those people, they talk less than the average salesperson. They talk between 45 and 65% of the time. And then the average salesperson talks between 75 and 85% of time. So they, they, they talk less. It's a conversation with a customer, not a monologue. The way they talk. Because we wanted to say, okay, you take this to your team, you say, okay, your talk ratio. Let's, let's talk less and listen more. How do you do that? How do you give people proactive feedback so they can actually do that? Because what if they don't know how to do it? It's a very simple trick that we found in the Reala labs which is the top performers. It's like a Jedi mind trick. They ask five times more open ended questions than the average salespeople. The average salesperson asks five open ended questions per conversation. The top performers ask 25 open ended question per conversation. So it's five times more. So what they're doing is they're asking open ended questions at the beginning like what brings us here today? What seems to be the issue? How is the temperature in your room? How long have you been living in the home? But when they do the demo, they stop. And instead of doing the demo and saying like this, this H Vac unit is better because of this and this and that and it's going to cost you this. They go, miss homeowner. It sounds like this just resonated with you. What about that resonated with you? Because then they stop and they kind of see, they make it interactive or if the homeowner is not feeling it, they go, hey, it sounds like this isn't resonating. What, what's not resonating about this? So pivot and show you something. That you're interested in. When they're dealing with objections, the. This is another thing that we found when. When at the final third of the conversation, the average sales rep starts speeding up their talk speed, so they start talking faster than normal. The top performers keep their talk speed and slow down a little bit. And the reason is, when they're dealing with objections, the average salespeople get. Get. They get excited and they get nervous. So their fight or flight response gets triggered, and they start talking faster. It's like, oh. The homeowner says, well, oh, my God, I cannot afford that. That's simply too expensive. I can't spend $20,000 in an H vac unit. That is just insane. And the replica's like, no, no, Mrs. Homer, you have to understand, $20,000 is not that much money when you consider all these different benefits. In our company, we have warranties. You can't go with this, like, Joe Schmo from out there, like. And they start talking fast. What do the top performers do? Open in a question. They say, Ms. Homeowner, what. What do you mean by the price is too high? What does that mean to you? Is it. Is it the payment? Is it the price? What do you mean by the price is too high? And they said, well, I had somebody out here who came and gave me half the price. Okay, tell me a little bit more about this person. Who is that other contractor that you're talking to? How about their licensing? How about their warranties? And they start discovering. And it doesn't feel like a debate. It feels like a. And that's why they. When you listen to a top performer deal with objections that you. And you'll be like, man, why do they sound so cool and so smooth? It's because they're slowing down and asking questions. That's all they're doing. That's the Jedi mind trick. And so there's many more of these insights, and I could keep going on and on and on.
- [25:40]
Host
No, no, no. That's a perfect example, though.
- [25:42]
Co-host
Like, that.
- [25:42]
Host
That's where I was going with. That's really neat data. That sounds like a really fun thing to do.
- [25:49]
Sebastian
Yeah. We're about to do an analysis on laughter because one of our friends, one of our coaches, said that every time he listens to top performers, they make people laugh. And so we're going to do an analysis of if laughter is correlated with a higher close rate. So we'll be publishing that next week.
- [26:02]
Co-host
It's like. That's like Monsters, Inc. Or something. Like, what's the Laugh score or whatever.
- [26:07]
Sebastian
Yes, the, the scare score and the laugh score.
- [26:10]
Co-host
Yeah, yeah, yeah. Feel free to use, you know, feel free to use that.
- [26:15]
Sebastian
Yeah. That's gonna be the thumbnail for when we publish that video. Yeah, it's gonna be the monster sink thing.
- [26:20]
Co-host
What's the, what's the average time to onboard? So somebody jumps in, like, how fast is their team usually seeing improvement? Because this is a debate in some of the chats or Facebook groups that I see is like, okay, well, how fast does it work? One of the benefits of working with Wilson, we are basically a same day, next day company. So what that means is if I sell a job today, I'm going to aim to get it in today, tomorrow or the next day. Like, we aim for a really fast turnaround and because of that we have pretty high expectations of our suppliers. Getting parts in time has been a real challenge and supplyhouse.com has been a really awesome partner for us because of that. They've got like a quarter of a million SKUs. They've got it across plumbing, H vac and electrical. So they cover all our different lines and they can get stuff to you fast and they have a ton of it. Plus on top of that, they have best in class pricing. And their new Trademaster program gives you free shipping, free returns, and a bunch of discounts over retail on top of it. And the Trademaster program is free to join. So check out supplyhouse.com make sure to check out their Trademaster program.
- [27:22]
Sebastian
Yeah, yeah, yeah. So this is a good question because there. So because it depends on the, on what the definition of onboarding is. So for us to get somebody set up using the tool and get them using it, just like recording and the managers can use it, it takes about two hours. So you have one meeting with your customer success manager at Rila. They set up all your integrations with all your systems. Then you go out there, you do another meeting to launch with the salespeople or the technicians and that takes two hours. In the launch meeting, that's when we do the whole pitch and we kind of soft sell them into the whole concept and we show them how to use the app. That's all you need. It's a very simple product. It's not like a CRM technology that takes months to implement because you're like literally doing open heart surgery on your business. It's not that complicated. So you start using it and a week after you started recording, then we do an onboarding with the managers where we show them how to coach on Rilla, because it's a new concept, virtual ride along. We show them how to fit Rilla into their workflow every day. So that takes another hour. And so after the first week, you start seeing that ROI in terms of like being able to do virtual ride alongs. Like, literally, like Sylvia, who I mentioned, who manages 30 technicians, we onboarded her into our little virtual ride along game and. And Sylvia started doing her first month. She did like 435 ride alongs, like right after we onboarded her. So that's compared to like four ride alongs a month that she was doing before. And so you start seeing the ROI from the wealth creation of the virtual ride along immediately, like first week. But then your sales numbers start improving. After about a month is when you start seeing those results. And it takes about a month because first of all, you have to track the results monthly in some way. And you start seeing improvements from some people, not the entire team in the first month because it takes time to get the buy in and the adoption, stuff like that. But month two, that's when you start seeing the ROI of the product in terms of like sales improvements, conversion rates, average tickets. Month two, that's when we do the first ROI analysis and we say, look, the people who are on Rilla, if you have a large company, we like to put half and half, half on, half off, so that we could show you like, hey, look at the people on Rilla and look at how they outperform the people who are not on Rilla. What's the. It's like when you do a medical trial of a medicine. You want to see like, hey, the people who took it, that they outperform the people who didn't take it, that they get better from their sickness. And so we do that and that we do in two months. And definitely in the first quarter you start seeing those gains. And what's really cool is that you see the gains. It's not just like the gain stops. It's like the more coaching, the more training. Coaching's an everlasting. It's an infinite game. You never stop. So you have to keep coaching, you have to keep training. And the more you do it, the better the numbers get. So it doesn't stop over time either.
- [29:51]
Host
And how big should a customer be before they reach out to you for a demo? What's like the ideal size of a contractor?
- [30:00]
Sebastian
About five technicians who are comfort advisors in the field. And so that's kind of rule of thumb. If you have five technicians or comfort advisors, you're gonna, we have like a, from over the years that we've been launching, I think we've retained 97% of our customers who are above that size, which is why we. So basically, if you're a customer that has five technicians or comfort advisors, there's a 97 chance that you're gonna retain with Reala that you'll have success and keep, you know, using Rila year over year. Just from first principles though, I would say, because there are some contractors who are lower than that level who we still allow to use rila. And the first principles that you want to look at is, okay, do you have people on the field? Like, do you have three people, four people on the field? Number one, do you use a CRM technology? Do you use some sort of field service management software? If you're not using a field service management software, you need to get that fixed first. You need to get your business off a pen and paper and use a process to document everything. So do you use a field service management software and you have it implemented? The third is, do you have a coaching program, a coaching process that your team's supposed to follow, some sort of, some sort of coaching that you do in your, to make sure or some sort of presentation that you tell them to give in the home, some sort of steps that they're supposed to follow. And number four, and, and this, these are the basic requirements. But really to have the most amount of success. Have you started or are you already doing physical ride along? If you're doing physical ride alongs or have started thinking about them, that's when Rila is going to provide significant ROI from day one. And so, yeah, so that's how I would think about it. If you're already doing physical ride alongs, you likely have a process, you likely have a CRM. And, and if you use Rila, you're going to see like games in the first week.
- [31:41]
Co-host
So what, what other pro tips from the best in class out there? What else can we share?
- [31:47]
Sebastian
We did. So I was talking about talk speed in the last point. So we actually wanted to see if there was a ideal talk speed for the industry and we saw that there was. So we looked at talk speed and how it's correlated with close rates and average tickets. And the graph for those of you who can't see it looks like a bell curve that's skewed to the left so that it peaks towards the faster side. So if you put a talk speed in the horizontal axis and you put average ticket on the vertical axis the graph, it kind of skews to the left, which means that the peak is to the right. So it, so it, so the, the average, the peak Talk speed is 184 words per minute, right? So the average human talk speed, and that's the, that's the peak that has the highest average ticket and the highest close rates in the correlation graph. But, and that's interesting because that's a little bit faster than the average human talk speed. The average human talk speed is about 155 words per minute. 155 to 160. So if you do the math there, 184. Compared to that, that's about 1.2x the average human talk speed. So if you want to get good at, if you want to sound like the top performers and get that peak talk speed, what I would recommend is you listen to podcasts at 1.2x speed. And if you do that, you're likely going to talk at that speed because you're just gonna. The reason I talk so fast, by the way, John and Jack, I literally play my rilla. I use rilla to coach our own salespeople, like our own sales team. I use rilla and I play Rilla at 3x stock speed. So I literally talk so fast because I'm used to listening at really fast speeds. So if you want to be at that 184, I would recommend you list you listen to podcasts at 1.2x speed and that's how you should sound like as a top performing salesperson. What's also interesting about this metric is that it doesn't peak. It doesn't peak and it keeps going up, it peaks and it drops down. So if you talk really slow, that might not be good, but if you talk really fast also, that's also going to drop your numbers because then, then you lose all the gains from speeding up. So if you like, are like me and you're talking 220 words per minute, you're talking really fast, you're gonna start losing gains in average ticket and losing gains and close rates because the homeowner will be like, I don't understand anything this person's saying. I can't process what they're saying. They're talking so fast like I am right now, and they're giving so much information, I literally don't have the time to process what they're saying. Now if you talk so slow, it's a sign that you might have let low energy and then the homeowner's not going to be as excited and as interested to move forward with you in a business. So 184 words per minute is the peak talk speed that we found for the industry, which is really, really interesting. And again, these are averages across trades, guys. So it's gonna vary depending on region, but that's the average across the trade. Across.
- [34:36]
Host
Do you really yourself want to know.
- [34:39]
Co-host
How fast I talk?
- [34:39]
Host
Yeah, exactly.
- [34:40]
Sebastian
That's what I was thinking.
- [34:41]
Host
Like, you have to reload yourself. You know exactly what you're talking talk speed is, don't you?
- [34:46]
Sebastian
Yeah, I can even check the. That's my average all time. But I can check, like in this last month what it. What it's been, but yeah, it's around there. Yeah, it's like 200. Maybe this. This month I did a little bit better. Let me tell you right now. I'm looking it up. My talk speed is this month. Oh, look at that. My average talk speed this month is 186.6 words per minute. When I'm doing all the customers, I slow down. I slow down naturally, practicing what I preach. Look at that.
- [35:17]
Co-host
That's funny. That's funny. This. This was good, man. All right, so we're able to record tons of conversations. We're able to figure out how to replicate our best performers. We got some pro tips on how to succeed with any last lessons on how to implement this or anything else you'd leave the listener with to really help drive some value here.
- [35:43]
Sebastian
Yes. This is a really exciting time to be in the Traits. You know this. You dedicate your podcast to this.
- [35:55]
Co-host
The reason, arguably my life.
- [35:57]
Sebastian
Yeah, yeah. Literally the whole thing just upon essentially my entire life.
- [36:03]
Co-host
Yes.
- [36:05]
Sebastian
Yeah. So the. So. So the angle I'm coming at it from. So, so it's. Yes, it is a, a, a. It's. It's like you say. It's. It's. It's one of the biggest pathways to pursue the American dream. There's so many businesses that you can start. So many traits. I saw a post that you posted on LinkedIn. There's like, so many traits that you can pursue. You can pursue the big three, or you can pursue different traits, like trees and chimneys. Like, we have so many chimney people that use Rilla. We love our chimneys, man. And. And the reason why I'm saying it's one of the most exciting times in the Traits is that the amount of sophisticated capital that has entered the space is like it's never been before because of COVID What happened was Covid hit and it was the Biggest gold rush ever that we've seen in the home improvement industry. Because of work from home, people in cities like New York and San Francisco, where there's not a lot of market for home improvement, move from cities like New York and San Francisco to the suburbs. When you move to the suburbs, immediately, the market for home improvement opens up because you want to redo the kitchen, you want to fix the yeast factor unit, you want to do a re pipe. And there's so much like, if you live in New York like I do, and you move into an apartment and the windows kind of funky. Well, the windows just kind of funky. And that's your window, you're not going to fix it, you're not going to replace it. You're just, that's it, that's your window. When you went to a house, you're going to fix things. And then you're also spending so much time at home. The American homeowner has never spent so much time at home, like, ever. Like a percentage. Like, there's like, the average American homeowner is now spending like eight waking hours at home because of work from home. And before it was like four hours. So it's like people are spending the most amount of time at home ever, which means that they're using their appliances more, they're feeling the pain of their home improvement home services projects more than ever before. So they're more likely to go on Google, they're more likely to want to look for some replacement opportunities. And so because of this, private equity has taken notice. And that's why you see so many PEs rolling up into the space with so much sophisticated capital. And these, these are the suits from New York and San Francisco who are saying this is the biggest opportunity in private equity. And so they're coming in, they're funding businesses that are from really smart business owners. So now there's an exit opportunity for entrepreneurs because now there's like, actual money being given to, like, these businesses who scale to a certain degree. And the other thing that has happened is that the venture capitalists who fund technology companies have taken notice that this is one of the biggest markets in American history that we've ever seen. And so they're funding companies like Rilla and ProBook and Avoca and Conduit, and these are all like new startups that are coming out. So the founder of Pro Book, George Eliades, he's. She barely graduated from University of Pennsylvania. Tyson, the founder of Avoca, he graduated from mit. Shelby from Conduit Tech, she went and did her MBA at Stanford University. And these are all really talented, some of the smartest founders right now in the world who are targeting products specifically for home improvement contractors. And so the reason I say it's the most exciting time to be in the trades is because AI just started at the same time that this new development in the market started. So what's happening is that the early adopters of AI technology are not in New York and San Francis. They are in Manassas, Virginia, selling H Vac replacement. They're in Nashville, Tennessee, selling chimneys. They're all over the country selling home improvement. Home improvement contractors are the early adopters of AI technology. I'm living proof of that. We're one of the fastest growing startups ever. And right now, selling an AI product to. We don't sell to anybody else other than home improvement contractors. And so just like Rilla, there's so many other awesome technologies that are built specifically for the trade. And what it's doing is it's allowing contractors to be at the very forefront of technology adoption, which has never happened before. And it's such a cool time because now if you're a really smart person and you go into a home improvement business, into a trade, you can actually be the best at implementing technologies and get an amazing head start. It's no longer an older, archaic industry. It's a dynamic, really fast moving industry where you have to stay ahead, where you have to be innovative. And so to me, the biggest thing I would say, if you're a home improvement contractor, it's like, this is not the same industry it was 10 years ago, man. There's so many smart people, there's so much smart capital coming in. This is the hottest industry in America right now. And so get ready to move, because if you don't move, you're going to get left behind, man. So, like, it's exciting, but if you don't move, you're going to get left behind. So. So that's the biggest thing that I would say.
- [40:31]
Co-host
Yeah, I mean, I agree. I think, you know, I started off in the trades in 2009 and, you know, we had Ellen Rohr on the show a couple weeks ago. I don't even know if that.
- [40:41]
Sebastian
We love Ellen.
- [40:42]
Co-host
Oh, yeah, yeah. No, she's great. Yeah. I think that aired like two weeks ago, but. But she and I were like swapping these stories because I. Even for the trade, I'm 33 years old, but, like, because I've been in the trade since 2009, I'm old for the Industry. And I remember the industry from 10 years ago ago because that's how I cut my teeth. And it is a different industry than 10 years ago. And I really don't think people understand how different. I mean, this is like my best comparison is Uber. Like, hey, everybody was a taxi. And then Uber came along. And that's really the level of disruption that we're seeing in the trades. And if you're just coming in 2019, 20, 20, 2021, you have no idea. Like, you have no idea. Like, it is such. It, it, it boggles my mind still sometimes just thinking about like the insane change that we've lived through and also how not enough people even seem to understand that the change happened because they all came after it.
- [41:49]
Sebastian
Yeah, yeah, yeah, yeah. So, yeah, it's a, it's a, it's a really, really cool time. If you look at, it's so fun to see. Like, if you look at. I keep meeting new startups every single, every single week I meet new startups that are coming up. Like, I don't know if you guys know Y Combinator. Y Combinator is the biggest startup accelerator in the world. And there's so many businesses coming out of Y Combinator targeting home service businesses specifically. And, and that has never happened. So it, which is, which is so cool, man. Who would have thought that, that AI, the early adopters of AI technology would have been plumbers and electricians and H vac technicians and chimney specialists. It's so cool that this is the, the way the world is going. So I'm here for it, man.
- [42:32]
Co-host
It's wild. It really is wild. I, I often, I've joked about that with a few of my friends who work in like ancillary industries and, and we discuss how deep AI has penetrated because at this point in home service, like, it, it touches almost every aspect of the business, right? It touches our, like, it touches our customer interaction via email or text or even day to day communication with inbounds, either phone or message. It touches job summaries, it touches invoicing, it touches training, it touches marketing, it touches everything. And like, man, that move fast because, because it was introduced to the trades like 14 months ago, barely talking about.
- [43:14]
Host
This a year ago. And then we, we circle back every six months and it's just some kind of leap and bound above where, yeah.
- [43:19]
Co-host
We had an episode in March because I was at a ski trip or February or something and, and it was like, oh man, I wonder what the future of AI is in the industry. And then like fucking six Months later.
- [43:29]
Sebastian
Like the future is everything.
- [43:33]
Co-host
Yeah, really.
- [43:36]
Sebastian
It's like you have AI for your marketing. So for lead generation you have AI for your call center where there's companies like Avoca who's literally your end goal is to replace the call, the human call center. It's like literally replace it with an AI. Then you have AI dispatching with people like Pro Book that are trying to AI automate dispatch. Then you have AI coaching with Rilla, you know, AI virtual ride alongs. Then you have AI rehash with Chirp and Hatch and you know all these different tools and then you have you know like AI like there's like AI claims approval process for insurance. There's a company, I don't remember what it's called, but it's from former Uber people who are building for the trades. It's like a thing to automate your insurance approval process. It's just like literally every, every touch point of the customer journey is getting touched by it by a by a point solution for which is an AI native application which is, and it's like you said, it's the future, but it's like happening right now. These are, I'm not talking about like ideas, I'm talking about companies that are growing. Some of these companies are even growing faster than Rilla was back when we started. Which tells you that it's a, this is one of those technologies that it just keeps growing exponentially. And I think that real is one of the fastest growing companies of all time now. But in a year or two there's going to be another company that's going to pass us still selling for the trades by the way. So it's kind of like I don't know because I don't know the numbers of the other startups but it might not be insane to when the Internet started and there was a few handful of companies that actually took over the dot com market like Salesforce and Amazon. It would not be insane to see that some of the generational companies that are using AI are companies that started selling to home improvement contractors right now because of this like kind of market domination.
- [45:27]
Co-host
Well, I mean there's, there's literally millions of home service contractors. Like the market is, the market is huge. It's like the most disparate market out there. So I, I can understand how it can grow fast.
- [45:41]
Sebastian
Yeah. Especially for, for tech people like the VCs love being able to sell to large enterprise buyers. I was at a service side event, the private equity symposium that they did a New York a few months back. And they, they, they basically said that when the private equity came in, service titan was a little bit iffy. But now the private equity customers are their top customers, the ones with the highest nps, the ones who have the operational capabilities. Tech companies love, like big customers with large enterprise deals. So it makes it an even more attractive industry for that reason. So it's like I said that that's my main message. It's like it's, it's such a cool time. You have to stay active. You have to keep your ears close to the ground. You have to start playing around, just, just like play around with the new technologies. Just like literally get familiar with it. Because Tommy Mellor, our good friend, always says that he's not running a garage door business. He runs a technology company that sells garage doors. And that statement, you think it's marketing has never been truer. That is such a true statement. Today you guys are running technology companies that sell home improvement. And in order to run a technology company, you should be really well versed at implementing new technologies. So.
- [46:47]
Co-host
Yeah, I agree. Well, thanks for coming on today. This was a lot of fun. I feel like I got a good lesson in dropping AI into the trades.
- [46:54]
Sebastian
Yeah.
- [46:56]
Co-host
If people want to hear more, like understand Rilla a little bit better, where can they go?
- [47:00]
Sebastian
They can go to rila.com, that's r I l l a dot com, and they can go ahead and book a demo. And one of our salespeople will be using Rilla and I will probably be reviewing and doing a virtual ride along on your conversation because that's my favorite thing to do. So go ahead and go to vrilla.com r I l l a.com and before you book a demo, you could also go and check out the customer stories that we have there because that's the best way that you're going to learn of what this tool can do for your business. So.
- [47:30]
Co-host
All right, thanks, Sebastian. Appreciate your time today.