Podcast Summary: Owned and Operated
Episode: Entry & Exit #1 – How to Build, Scale & Sell a Security/Fire Business
Host: John Wilson
Guests: Stephen Ullman & Colin Trimble (Alarm Masters)
Date: October 8, 2025
Episode Overview
This episode marks the launch of a new segment, "Entry & Exit," focused on unraveling the security and fire alarm industry: how to successfully enter, grow, and eventually exit (sell) these businesses. John Wilson (host and $30M home services owner) is joined by Stephen Ullman and Colin Trimble, co-owners of Alarm Masters, a Houston-based commercial security and fire company. Drawing on real acquisition stories and operational wins, they share practical, ground-level advice on scaling, M&A, customer management, and organic growth.
Key Discussion Points & Insights
1. Founding Story and Initial Acquisition
- How They Met & Industry Move
- Colin and Stephen met at Texas A&M (00:15). Both entered technology/software sales, but eventually were drawn to buying businesses.
- “Colin sat me down one day and said, let me tell you why the future of your life should be security and alarm. And I was like, not so sure.” – Stephen [02:39]
- “Give me 30 minutes and we'll get you there.” – Colin [02:52]
- Colin and Stephen met at Texas A&M (00:15). Both entered technology/software sales, but eventually were drawn to buying businesses.
- Acquisition Process
- Unlike typical buyers (“searchers”), they bought the first business they seriously considered via a warm industry connection—no long search, just luck and timing (04:05–05:34).
- “We literally bought the very first one we ever looked at.” – Stephen [05:34]
- Unlike typical buyers (“searchers”), they bought the first business they seriously considered via a warm industry connection—no long search, just luck and timing (04:05–05:34).
2. Industry Breakdown: Revenue Types & Business Model
- Three Revenue Types in Security/Fire [06:09]
- Installation Revenue: Upfront projects—retrofits, new builds
- Service Revenue: Repair or maintenance on existing systems
- Recurring Monitoring Revenue (RMR): Monthly/annual monitoring fees—and increasingly, cloud subscriptions
- "You get this mix of recurring revenue...and then you get the kind of one-time larger projects." – Colin [06:09]
- Alarm Masters’ Focus: 80% commercial, 20% residential, with organic growth primarily through cross-selling services to existing commercial clients [07:23–07:31].
3. Growth Journey: Organic & Inorganic Expansion
- Numbers at Acquisition vs Present
- Acquired business: < $2M revenue, ~13-person team [08:11, 23:19]
- Now: ~3x growth to ~$6M+, ~40-person team (with 11 international hires) in 2.5 years, 4 acquisitions [09:01, 27:58, 28:01]
- "We've basically 3x that through organic and inorganic activity and we're kind of, you know, marching towards 10 million." – Stephen [09:01]
- Growth Split: 50/50 organic (internal sales/cross-sell) and inorganic (acquisitions), with remarkable early organic RMR growth (50% in year one) [09:18].
- “We grew RMR by 50% in year one organically, which when we tell other people that like what did you do? It’s like, well, Colin's just really attractive. You know, he really just...brought some people tacos and donuts and smiled.” – Stephen [09:18]
- The Cross-Sell Engine
- Buying accounts for their monitoring, then unlocking new revenue streams as the primary provider for multiple "scopes" (access control, cameras, fire alarm, intercom, PA) [10:34–11:45, 11:45].
4. Scaling Operations: Team, Leadership, & International Talent
- Initial Team & Operational Approach
- First day: Small team, immediate challenges (vans broken into, tools stolen), focus on learning/absorbing—all to identify improvement levers [23:19–26:39].
- “My goal was, how do I become the best employee at the business?” – Colin [25:15]
- First day: Small team, immediate challenges (vans broken into, tools stolen), focus on learning/absorbing—all to identify improvement levers [23:19–26:39].
- Leadership Buildout:
- Promoted from within, then brought on operations manager, customer success manager, sales manager. Now at 40 employees, including 11 international staff (in Latin America) to handle quoting, scheduling, estimating [27:56–30:13].
- “We found literally our best and smartest international team member. His name is Felix. And we trained him on how to do all of our quoting. And this guy knows how to quote and design systems better than I do now.” – Colin [29:44]
- Promoted from within, then brought on operations manager, customer success manager, sales manager. Now at 40 employees, including 11 international staff (in Latin America) to handle quoting, scheduling, estimating [27:56–30:13].
5. Sales & Marketing: The Power of Cross-Selling
- Primary Strategy: Cross-selling Existing Customer Base
- Vast majority of effort is cross-selling underutilized accounts—sometimes employing a “coffee drop” (or taco drop) where reps simply visit, foster relationships, and offer value [31:07–32:31].
- “We have an international SDR and their whole job is to call our existing customers to say, hey, Paxton’s going to be in the area. He’d love to stop by and bring you some tacos or a coffee to introduce himself.” – Colin [32:05]
- Vast majority of effort is cross-selling underutilized accounts—sometimes employing a “coffee drop” (or taco drop) where reps simply visit, foster relationships, and offer value [31:07–32:31].
- Why it Works:
- Low Competition: Most competitors don’t actively market to or even contact their own customer bases outside of emergencies [35:20–35:56].
- “Nobody else is marketing to their existing customers...Even some of the most successful guys...have said, man, yeah, we don’t do that. We should be doing that.” – Colin [35:20]
- Service Responsiveness: Emphasize prompt, fairly priced service work (opposite of industry norm), leading to high conversion to monitoring/project sales [36:41–37:24].
- “When customers call us, we say, see you tomorrow. And we charge them the same rate as our monitored customers. And 75% of the time the customer comes back for additional revenue or flips to monitoring.” – Colin [36:41]
- Low Competition: Most competitors don’t actively market to or even contact their own customer bases outside of emergencies [35:20–35:56].
6. Financial Structure: Margins, Branches, & Competitive Landscape
- Branch Size & Margins:
- Ideal: Buy $2-5M platform businesses, expand to $6-10M per major city [13:54–15:03]
- Target net margin: 15–20%; possible to reach 25–35% if growth is deprioritized [15:03].
- Revenue Mix and Margins:
- RMR (Recurring): ~65% gross margin [22:28]
- Service: ~60%
- Projects: 40–50%, higher if direct-to-customer (no general contractor) [22:28–23:07]
- Industry Players:
- Nationals (ADT, Johnson Controls), Regionals ($20–30M+), Independents ($1–10M). Integrators vs Security/Alarm companies’ business models differ in project vs recurring focus [15:40–18:54].
7. Challenges & Unexpected Realities
- Emotional Burden:
- Residential customers are more emotional; fire systems come with high stakes (“real lives are at stake”), leading to real anxiety for owners [44:10–44:39].
- “If you don’t have your technology and your quality technicians...real lives are at stake. And...that is something as a business owner that I lose sleep over...” – Colin [44:39]
- Residential customers are more emotional; fire systems come with high stakes (“real lives are at stake”), leading to real anxiety for owners [44:10–44:39].
- M&A Market is Hot and Competitive:
- More buyers and high multiples, even at small scale; competition is strong, especially for valuable fire accounts [45:53–47:54].
- “We're seeing very aggressive activity in our industry from an M&A perspective...even within that...fire accounts...are some of the most valuable accounts.” – Stephen [45:53]
- More buyers and high multiples, even at small scale; competition is strong, especially for valuable fire accounts [45:53–47:54].
8. Competitor Dynamics: Independent vs National Giants
- Service & Satisfaction Challenges
- National players struggle with nuanced delivery (customer blame, ambiguity in scope), making it possible for responsive independents to win market share [41:01–43:51].
- “There's a joke...the best salespeople that these independent operators have is ADT.” – Colin [41:01]
- National players struggle with nuanced delivery (customer blame, ambiguity in scope), making it possible for responsive independents to win market share [41:01–43:51].
9. Advice & Vision for Entry & Exit Show
- Podcast Purpose
- Bring an honest, growth/operator-focused lens to the security/fire industry
- Demystify M&A, growth, and exit, especially for new & prospective buyers [50:02–50:57].
- “What we want to talk about. We want to talk about how to grow, how to get into the market, and then also, what does it look like when you want to exit that market?” – Colin [50:02]
- “We want to give an honest look into the security and alarm space and share our journey, share what we're learning, talk to other really bright people...” – Stephen [50:57]
Notable Quotes & Memorable Moments
-
On Winning the First Acquisition:
"We literally bought the very first one we ever looked at." – Stephen [05:34] -
The Power of Cross-Selling:
“Nobody else is marketing to their existing customers...Even some of the most successful guys...have said, man, yeah, we don’t do that. We should be doing that.” – Colin [35:20] -
On Human-Centered Growth:
"I just kind of bet on human interaction. And so if we get people in front of someone, we're gonna find a way to extract value from that encounter.” – Stephen [39:47] -
Margins by Revenue Type:
“If you blend the RMR, you’re probably looking at like 65% gross profit margins...on the service side, we like to be closer to 60%...and then on a project...really try to push north of 50...” – Colin [22:28–23:07] -
Service Standard:
“When customers call us, we say, see you tomorrow. And we charge them the same rate as our monitored customers. And 75% of the time the customer comes back for additional revenue or flips to monitoring...” – Colin [36:41] -
On Entering a Life-Safety Industry:
“If you don’t have your technology and your quality technicians...real lives are at stake. And...that is something as a business owner that I lose sleep over...” – Colin [44:39]
Timestamps for Key Segments
- [00:54] – Guest Introductions & Episode Launch
- [02:15] – How Colin Convinced Stephen to Enter Security/Alarms
- [04:05] – Origin Story & First Acquisition
- [06:09] – Types of Revenue in Security/Fire
- [09:01] – Company Growth from $2M to $6M+
- [10:34] – Cross-Selling and Inorganic/Organic Growth
- [13:17] – Texas Regional Focus & Market Size Goals
- [15:40] – Revenue & Industry Tiers (National vs Regional vs Independent)
- [22:28] – Gross Margins by Revenue Type
- [23:19] – Initial Team & Early Acquirer Challenges
- [27:56] – Building Leadership Team & International Talent Strategy
- [31:07] – Marketing: Cross-Selling & Coffee Drops Explained
- [35:20] – “Nobody else is marketing to their existing customers...”
- [36:41] – Service-First Approach, Winning Clients from Competitors
- [41:01] – Competing with National Giants, Customer Satisfaction Issues
- [44:10] – Hardest Lessons and Emotional Weights of the Business
- [47:54] – Competitive M&A Market, High Multiples, Aggressive Buyers
- [50:02] – Entry & Exit Podcast: Goals & Future Directions
Language and Tone
The conversation is energetic, practical, and candid—peppered with banter, actionable strategies, and real talk about the ownership journey. Both Colin and Stephen are open about missteps, lessons, and how little experience they had at the outset, making the advice highly relatable.
Next Episode Preview
The next “Entry & Exit” episode (“The $10 Million Blueprint”) will focus on building systems, delegation, hiring, and breaking out of the owner-operator phase.
Contact & Socials:
- Colin Trimble: IG: @CTX | LinkedIn: Colin Trimble
- Stephen Ullman: All socials: Stephen Ullman
- Podcast: ownedandoperated.com