I Bought 3 Home Service Businesses in 90 Days — Here’s What Happened

Summary

Episode Summary: "I Bought 3 Home Service Businesses in 90 Days — Here’s What Happened"

Podcast: Owned and Operated
Date: April 9, 2026
Hosts: John Wilson (CEO, Wilson Plumbing Heating Cooling & Electric, OH/IN)
Jack Carr (CEO, Rapid Plumbing Heating Cooling, TN)

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Overview

In this high-energy, brutally honest episode, John Wilson and Jack Carr pull back the curtain on Wilson's most ambitious growth sprint yet: acquiring three home service businesses in just 90 days. The conversation digs deep into why, how, and what happened after, with practical lessons for ambitious operators. Along the way, they cover strategic reasoning, operational execution, team-building, deal structure, and realizing real financial and cultural synergies through thoughtful M&A.

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Key Discussion Points and Insights

1. Strategic Approach: Organic vs. Inorganic Growth

• John underscores his belief that “best-in-class companies have a very strong organic and inorganic growth strategy.” (02:00)
  • Organic: Building through marketing, sales processes, hiring, and operations.
  • Inorganic: Growth via acquisitions, expanding geography or services.
• “You can be too lopsided on either side of this. All we do is deals—that's lopsided and weak. All we do is grow organically—also weak.” (03:30)

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2. M&A as a Growth Lever:

• Advantages of Acquisition:
  • Entering new trades/services (e.g., electrical, restoration).
  • Expanding into new geographies quickly and efficiently.
  • Overcoming the challenges of starting a new vertical from scratch by acquiring skilled teams, inventory, and established processes. (04:48)
• Strategy Behind Recent Deals:
  • Focused on “service density” in existing lines and geographic expansion for leverage.
  • Seeking higher gross margin services to lift blended company margin. (05:47)
  • Mature infrastructure (HR, accounting, marketing) now enables fast, large-scale absorption: “If I add $10M in revenue tomorrow, I will not have to add more people to my accounting team…maybe another call taker.” (08:25)

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3. The “Yes Man” Mindset & Luck

• Opportunities arose faster than planned. Wilson likens it to the Jim Carrey movie Yes Man: “When an opportunity comes your way that you didn't expect, do you have the ability to say yes?” (00:14, 14:25)
• Preparedness is key: capital, leadership, systems must be in place to react quickly when luck strikes.

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4. Details on the Three Acquisitions

• Industries: All plumbing and HVAC; one includes electrical.
• Deal sizes:
  • Smallest: $1.5M (plumbing only)
  • Middle: $3.5–$4M (plumbing + HVAC)
  • Largest: $6M (plumbing, HVAC, electric)
• Sourcing: All through Wilson’s network, podcast, and events—recurring proof that “putting yourself out there” accelerates deal flow. (17:00)
• Deal Speed: Closed one deal in 25 days after a year of relationship-building. Another in a month from first conversation. (16:31)
  • “How many people have the privilege of being reached out to by a friend and saying, hey, can I sell you my company?” (16:55)

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5. What Actually Happened—Operational Shock & Results

• Wilson’s business grew from “high 20s” to “around 40” in revenue (millions) in just one quarter—a roughly 50% jump. (19:14)
• Immediate Impact:
  • Integration of new branches slashed overhead, increased EBITDA margin from mid-teens to 24% in February (shoulder season in Ohio).
  • “We did 24% EBITA last month, which is crazy ‘cause we’ve historically been like 14–17. It was like a 7-point jump purely because we’re bringing on these new branches and their overhead just goes away.” (12:26)
  • One acquired business immediately up 50%: “We walked in day one, we raised prices, gave team members raises, and spent a lot more money on leads.” (19:27)
  • Despite adding 40 employees in Q1, impact was manageable thanks to existing systems. (22:00)
• Key Integration Focus:
  • Leadership is the make-or-break factor in successful M&A.
    • “Anytime we’ve messed up on M&A, it has always been—10 out of 10 times—the leader.” (24:00)
    • John personally coached branch managers daily during early integration.
  • Rapid centralization: call center, dispatch, inside sales, leadership training, and regular HQ events. (24:30)
  • “First 30 days of each acquisition is really like John…and then post that I start bringing in team members…” (25:00)
  • “Of the 12 or 13, these three were the easiest—because now our team is just mature.” (27:00)

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6. When to Use M&A as a Growth Lever

• Don’t go multi-location too early; build out internal infrastructure first.
  • “A lot of people go multi-location way too early…at $4 million revenue…It is harder than it looks.” (38:59, 39:31)
  • “We are already there…it’s like spreading less butter across more bread.” (39:12)
• Recommendation for growing home service companies:
  • “If you’re thinking about doing this fast—replicating what we did in ‘21—just buy one business a year, integrate it, get the muscle into your business…when you have your controller and your HR and your call center, go freaking nuts.” (26:45)

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7. Deal Structure & Geographic Strategy

• Deal Structure: Asset deals at 2–3x earnings, sometimes more for premium, less for distress. (41:45)
  • “You buy the trucks, maybe accounts receivable depending on the deal, inventory, name, phone number, customer list…”
  • Most acquisitions to date have been distressed companies: “Of the 12 or 13 we’ve done, 9 or 10 have been distressed.” (42:11)
• Geography: Targeting the greater Midwest (OH, IN, MI, western PA, KY, TN, etc.) for logistics and supply chain leverage.
  • Close-in, “connect-the-dots” expansion to efficiently share infrastructure and field personnel (hour-away, hub-and-spoke approach). (29:00, 30:14)
  • “I’ve had friends buying all over the US and it was a mess…Real process every time you wanted to visit a branch.” (37:12)

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Notable Quotes & Memorable Moments

• On Balanced Growth:

  “Best in class companies have a very strong organic and inorganic growth strategy.” – John (02:00) “You can be too lopsided on either side…that’s lopsided and weak.” – John (03:30)

• On the Power of Scale:

  “If I add $10 million of revenue tomorrow, I will not have to add more people to my accounting team.” – John (08:25)

• On Seizing Opportunity:

  “When an opportunity comes your way that you didn’t expect, do you have the ability to say yes?” – John (00:14, 14:25)

• EBITDA Transformation:

  “We did 24% EBITA last month…a 7-point jump purely because we’re bringing on these new branches and their overhead just goes away.” – John (12:26)

• On Leadership’s Importance:

  “Anytime we’ve messed up on M&A, it has always been…10 out of 10 times—the leader.” – John (24:00) “We just put a ton of energy into that. Immediately I’m coaching their managers…every day for 20 to 40 minutes.” – John (24:30)

• On Multi-location Maturity:

  “The reason it works is because we have this infrastructure built. If we were a $4–5M operation, I think this would be a lot harder.” – John (39:12)

• On Distress:

  “Of the 12 or 13 we’ve done, 9 or 10 have been distressed…We’re not bothered by distressed, I kind of like them.” – John (42:11)

• Jack’s Sober Counterpoint:

  “I don’t agree, personally…because I don’t like that stress…Hey, we’re losing money day one? I like to buy businesses where we’re making money day one.” – Jack (43:52)

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Timestamps for Major Segments

• The Strategic Dual Playbook (Organic & Inorganic growth): 02:00–05:30
• Why Acquire? Expansion & Service Density: 04:21–05:22, 05:47–08:25
• The Yes Man Mindset / How Deals Landed: 14:16–15:49
• Deal Details (Industries, Sizes, Sourcing): 18:27–19:14
• Immediate Integration & Margin Impact: 19:27–22:00
• Operationalization & Leadership Focus: 23:29–26:00
• Business Maturity & M&A Readiness: 26:45, 38:59–40:18
• Deal Structure, Geographic Approach: 41:37–42:11, 29:00–31:48, 37:12
• Distressed Business Strategy: 42:24–43:39
• Who Should Connect with John for Deals: 34:09–35:27

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Conclusion/Next Steps

• Wilson expects to “digest” these acquisitions through the year but “will probably do another one—frankly, maybe two—later this year,” focusing on further connecting service areas. (29:00, 33:21)
• “If you’re Midwest, plumbing-heavy, sub-$5M, and ready—reach out!” (34:09, 41:12)
• For smaller operators: don’t rush to multi-location. Build internal muscle first.

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For full details, actionable insights, and Wilson’s signature transparency, listen to the episode and explore their earlier content referenced throughout.

Transcript

[A]

I bought three businesses in 90 days. Here's what happened. We did 24% even the last month purely because we're bringing on these new branches and their overhead just goes away.

[B]

So you're essentially adding 10 to 12 in run rate of revenue.

[A]

I'm going to run an awesome marketing and sales process and then I'm going to supercharge that by acquiring functioning businesses elsewhere. And I'm going to give them my marketing and sales process, which is absolutely wild. Like when an opportunity comes your way that you didn't expect, do you have the ability to say yes?

[B]

Just being prepared for that timing, when that timing hit.

[A]

I do think what would probably be a good strategy for most people is. Welcome back to Owned and Operated. I am your benevolent host, John Wilson. I'm the CEO of Wilson Plumbing Heating Cooling and Electric in Ohio and Indiana. And for funsies, I talk with my friends on the Internet about how to build home service businesses.

[B]

Funsies.

[A]

And for funsies. Yeah, for fun.

[B]

This is a serious podcast around here.

[A]

This is, this is real business. But hey, this is a home service podcast. So if you're interested in the home service industry, if you are growing inside the home service industry, you are in the right spot. Join. Joined with me on the show today is my co host, Jack Carr. Jack Carr is the CEO of Rapid Plumbing Heating Cooling down in Nashville, Tennessee. We're talking buying businesses, dude. That's what's on the agenda for today,

[B]

which is fun because I run the Jack Positions podcast. I love talking about buying businesses.

[A]

Yeah, yeah. You've got some, you've had some good stuff come out. I bought three businesses in 90 days. Here's what happened.

[B]

Good title.

[A]

Yeah. So if you've been listening to the show for any amount of time, you know a few things. One, I'm. John's an idiot. Like we know it, everybody knows it. The thousands of people, you know, we're on the same page. John's an idiot. Two, Jack is the voice of reason. Jack tries to tame most things I say. And three, 2026 was our big multi location year.

[B]

Yeah.

[A]

So those are the three things that everybody knows if you've been listening to the show for a while. So a little bit of background on Wilson. Third generation home service company, Akron, Ohio. We bought, I think 12 acquisitions over the years. I bought it 10 years ago. So acquisitions have been a big part of what we've done. And we've also grown a ton organically. Like last year, we finished in the high 20s of revenue and of that high 20s, like 70% of it was organic revenue and 30% of it was revenue that we acquired. So we feel pretty comfortable playing on both sides. And I'm, I have this like high conviction that best in class companies have a very strong organic and inorganic growth strategy. So just to break that down, organic is like marketing, better processes, marketing. We're gonna go market, we're gonna go sales. What's our marketing process? What's our sales process? And you do need that to be a good business. Like, you can't, like you can be too lopsided on either, either side of this. But like, hey, are we running a good operational business that is growing organically without M and A? Like, that's organic growth. Inorganic growth is mergers and acquisitions. So we're going to go buy some shit. And the, the best in class companies do both. Like, I'm going to run an awesome marketing and sales process and then I'm going to supercharge that by acquiring functioning businesses elsewhere and I'm going to give them my marketing and sales process so that way they can, you know, grow organically a lot. So I have a conviction that best in class companies can do both. And I know people that only play on one side of that. Like, hey, all we do is deals. And hey, all we do is growing organically. And I think that they're very lopsided and weak organizations, to be blunt. Weak.

[B]

Weak is a strong word.

[A]

You're weak.

[B]

But, but yeah, it's also, I mean you guys used it as a great tool for also integration into other trades, right? So like you bought electrical business, you bought the totally the restoration business. So they're all like, a lot of it was growth.

[A]

So maybe the reason to acquire is you can, you can acquire into new trades. So service expansion or geographic expansion, like, hey, I want to, I want, I. There's a city 45 minutes away from me, I want to go acquire something in that city. So that way I have a presence there. I can sell and market to their customers or like pay. Here's an electrical contractor, I want to add electric. So either one is great. We've done both.

[B]

Yeah. And early on it seems like the, not to say it's better, but one of the easier levers to pull to grow is to acquire into another vertical. Because startup of a vertical is extremely difficult.

[A]

Totally. Well, I mean that labor, the, like the hiring talent, the driving the sales process, just what's all the, what's all the stuff you don't know about this other new vertical? Like, yeah, just go, you can Just go acquire the team with that knowledge and inventory and process and price book and just all the stuff you're going to have to figure out.

[B]

And so now that you've, you've kind of done that because you've came into these three acquisitions at a point where you've already, you're running the big three, maybe a fourth if you include restoration. So obviously these three probably weren't new. Vertical oriented.

[A]

Yeah.

[B]

Are, are you focusing yours, your future on more geographical orientation and why Most

[A]

businesses don't lose jobs because they're bad. They lose jobs because they're busy and a customer could not get a quick answer. One missed call, one forgotten follow up and the job goes somewhere else. Quo helps solve that by putting every customer conversation, calls, texts, voicemails into one shared thread that your whole team can see. So whoever picks up next already knows what's going on. There's no scrambling for context, no more botched communication and nothing gets dropped. Quo helps keep your team aligned, helps you respond faster, and makes the customer experience feel way more consistent. If you want cleaner communication and fewer lost leads, check out [e-mail] owned. You'll get a free seven day trial plus 20% off your first six months. So, yeah, so we're, what we're looking for in acquisitions right now is we want more service density. And so what's our. We're trying to acquire a higher gross margin service basically. So that's how we're currently thinking about it. So hey, can I go buy a plumbing company that's doing 60% gross margin and can I use that to raise my overall gross margin by 2 points? So we're trying to hire or like we're trying to acquire for like density inside services we already offer and we're also trying to acquire new geographies, a big part of the last two years. You know, I'm gonna harken this back to 2024. Like we've got some really early podcasts, you and me. And like I made these declarations of like, we're not gonna have any unprofitable months. Which like we've literally done actually for like 26 straight months. Like we actually haven't had numbers unprofitable month, which is kind of awesome. But so hey, we're not going to have any unprofitable months. We're in infrastructure mode. We're bu, you know, a lot of those sort of earlier shows where we're building our HR team, we're building our marketing discipline, we're building accounting. So if you're trying to figure out and you're a company that's like growing from that like 5 to 15 million range, I would recommend some early 20, 24 episodes because like that is the live playbook of how to do it. Yeah, yeah, yeah. I, some, some days I think back to the like incredible resource that we put on just on the Internet. Like, like I started podcasting when we were $3 million revenue and we'll do like 40 this year in three states.

[B]

Like, yeah, I think that you were just above 10 when we started, which is wild. Yeah, yeah. And I was sub two.

[A]

Yeah, it's crazy.

[B]

Yeah.

[A]

So, but, but back to these 24 and 25, we buil where, hey, our accounting team is locked and loaded. Like If I add 10 million of revenue tomorrow, I will not have to add more people to my accounting team. If I, I, maybe another call taker or two. Not really anybody in hr? No one in marketing. Like that's the power of scale where we outgrew our overhead. Like our overhead year, year over year is less this year than it was last year. And, and last year it was less last year than it was in 24. So our overhead over a two year time period shrinking while revenues up by, you know, $15 million.

[B]

Yeah. Which is interesting and I mean, we'll dig into this later, but I'm very curious because, like why, why now? Why now versus before? Do you feel like you've gotten to a point in your processes where you can realistically add more revenue and the processes behind it are all set so that you're not, you're not essentially destroying everything and having to rebuild? Because at, at smaller scale it feels like a lot of time when you do these acquisitions. Like you just break every process versus now. You have the accounting team, you have the, yeah. The centralization teams that are able to help make these transitions a lot more smooth?

[A]

I, I generally I think that you can outgrow overhead. And I, I at least is like a percentage of growth year over year. So if I'm, if you're watching on YouTube, I'm like doing hand motions. So if you're listening to Spotify, you're, you're robbing yourself of something. That's funny. So, but like if our revenue growth is like 15% year over year and our overhead growth is 4% year over year, we outgrew our overhead. Right. Like we are, we are becoming more efficient with our fixed cost of the business. And our like thesis was hey, we've outgrown our overhead. I Want to diversify the business into new geographies with and just like give them our resources so that they can grow. And I don't think I will have to add infrastructure to do that. I think that I can go add $4 million over here, $6 million over here, 2 million over here. And I will be able to reduce their material cost by 20 to 30%. I'll be able to eliminate their software cost, I'll be able to eliminate their like share like their services cost, whether it's consultants or agencies or whatever. Like we'll just use our internal team or our agencies and we will be able to take a business that is a 40% overhead business or 35% overhead business and we will be able to take that to 15 to 20% in branch overhead, which is absolutely wild.

[B]

That's so crazy.

[A]

Yeah, but like the honestly the wild part is we like beat that. Like maybe we'll pull up the piano but like we beat it guided by a lot. So we're yeah we surpassed that pretty, pretty hard, which is awesome. So, so the why is we've been building towards this forever because I just, you know, but one of the best benefits of this podcast is we can learn like we can talk to all these people and we can talk to these smart operators that are running multi location and, and we can just ask them anything you want. And hey, what, what's it like? You know Chad Peterman is still one of my like favorite episodes where he talks about this exact thing and this was 18 months ago and it was yeah, we want branches at 5 to 10 million because once you go above that you have to add infrastructure.

[B]

10 million totally receive. And I remember specifically he said it's a warehouse guy and it's a general manager and then technicians.

[A]

Like that was his org chart is sales manager, admin, techs. So very similar.

[B]

Yeah.

[A]

And, but yeah he said the same thing. Like hey, accounting is shared hr, shared marketing, shared call center, shared dispatch is shared. Like it's all shared infrastructure. So really all you're doing is bringing on like three to 20 texts over here that you will just benefit from the scale that you've already built. So this is when you know when you start seeing like giant companies running at 25 to 30% EBITDA. Like this is how they're doing it. Like we, we did 24% EBITA last month which is crazy because we've historically been like a 14 to 17. It was like a seven point jump purely because we bringing on these new branches and their Overhead just goes away. So that's the why we've been building towards this for years. This was the strategy 2026. I've said a bunch on the show, like it was going to be our multi location year. The only thing that we did not know is the goal. We have this plan and it was like, it's called our value creation plan. And it's like, hey, we're going to go from three and a half of EBITDA to eight or seven in 2026. And this is how we're going to do it. We're going to buy two companies and we're going to. There's seven pillars inside this plan and like the first pillar is like we're going to acquire two companies, maybe three. And like we, we acquired January. Here I come in Q1.

[B]

Yeah,

[A]

yeah. Which was kind of funny. But opportunities just kept coming up and we kept saying yes and I mean it. Yeah, so, so that's the why we've been building towards this for years.

[B]

So you're saying opportunities, but like, so what, what made these opportunities? Like let's get into some, some actual nitty gritty here. Like what happened and why did you deviate from that plan? Like how good was this opportunity?

[A]

Have you ever seen yes Man?

[B]

Yeah, yeah, a long time ago. What is it? He just says yes to everything.

[A]

Jim Carrey just says yes. Yeah, there's this yes Man's a funny movie and I think it's from like the 90s or early 2000s, but this idea is like he goes to this seminar or something like that. I don't even remember. And it's like, just say yes to everything. So he says yes to everything and it totally changes his life, like amazingly for the first 90 days. And then really bad because the government thinks he's a terrorist or something. And then after that it's like amazing again. And I kind of think about my career as like the yes man. As like when an opportunity comes your way that you didn't expect, do you have the ability to say yes? Like, do you, do you have the bandwidth? Do you have the capital? Do you have the balance sheet? Do you have the infrastructure? Like if someone walked into your business tomorrow and said, hey, I'd like to sell you my company, do you have the ability to say yes to that luck? Because a lot of this is, a lot of this is luck. A lot of like, yes, some of it is strategic and like we were thoughtful and we did all the right stuff, but when the opportunities came to us, like that part's kind of luck, you know, like someone else's timing was not my strategy.

[B]

Yeah. It's just being prepared for that timing when that timing.

[A]

Totally, totally. So, you know, on the nitty of like, what happened? So we had one we've been working on for a while and that, that announcement goes out pretty soon, so that should be fun. The other two were really quick. The sellers reached out to me. One of them I'd been talking to for about a year. He's attended our Breaking five events. He listens to the show, you know, so like he good relationship with us, understands what we're about and he reached out and like we gave him a value like a year ago and it wasn't quite what he was looking for. So he went back to work. And then in November he said, hey, I think I'm ready. And I said, I'm ready. Like, I'm. I'm the. I'm Jim Carrey. Right. Like, I'm going to say yes. Like, let's fucking do that. We'll figure this out. Let's get this done in 25 days.

[B]

Yeah.

[A]

Because I want to get it done by the end of the year. And we did it. We. I mean, it was a lot of work, but we got it done in 25 days. But. But it was, it was someone that. We had established a relationship. We had talked for a while and so was the second one. So the second one was an owner. He had a little bit of health stuff going on and he reached out to me and. And it was a similar scenario where I was actually like, I wasn't even close with the first one and it's like, do I have the capacity to do this? Like it's in a different city. Does my team have the capacity? Do I personally have the bandwidth? And I, I literally thought of the yes man movie and just like this. How many, how many people have the privilege of being reached out to by a friend and saying, like, hey, can I sell you my company? And I, you know, it's sort of like where there's great power, there's great responsibility. Like, I felt like, like, hey, I'm. I'm getting this luck. I need to do something about it. I need to go do it. Like. Like, why not?

[B]

Yeah, this is exactly.

[A]

So I said yes. And we closed that in about a month. And then the third one closed at the end of March. At the end of March. We're actually filming this like a week or 10 days prior to closing. So that's kind of funny. Been working on that one for a while. So similar friend worked through it for a long time, presented value and we were able to like, come together in a way that, that works for everybody. I think it was. I put myself out there on the Internet with a podcast. You put yourself out there on the Internet with a podcast? Like, all three of these people are like inside the sort of owned and operated system. They've all been to events or workshops or podcasts or whatever. And so I put myself out there, I establish relationships with people, and then one day, like, they'll be ready and I like, we'll be ready to execute whenever that. Whenever that day is. Yeah.

[B]

And that totally makes sense. And like, what. Around the range in sizing, what, what size and industries were these in?

[A]

Plumbing and H Vac. The first one in January was plumbing only. The one in February was plumbing H Vac, and the one in March is plumbing H Vac electric and.

[B]

And sizing.

[A]

Smallest one was like a million and a half when we bought it. And the next one was three and a half to four somewhere in there. And the final one is six.

[B]

And dude, that's awesome. That's crazy. So you're essentially adding in the first quarter of 2026, about 10 to 12 in run rate of revenue, and then you're hitting those ebitda margins at 20%. Like that is so wild.

[A]

No, it's absolutely ridiculous. Well, the business. The business. Yeah. So the business roughly grew 50% in Q1.

[B]

Yeah.

[A]

Which is a lot. And. And this, like the structure of the business changed a lot. So. So the whole. The premise of the show is I bought three businesses in 90 days. Here's what happened. So what happened was we went from high 20s to around 40 of revenue. It's actually a little bit hard to, to like nail that down. Exactly. Because the two businesses that we've acquired so far, like one of them is up 50%, like immediately up 50%. We walked in day one, we raised prices, we gave team members raises, we spent a lot more money on leads. So. So that company went from three or four tax to. They have seven today. So they're up 50%, but they'll probably double here, here soon. So it was a million and a half, but we're hoping for four. The next one, we're hoping to add around a million in service revenue. And the third one, don't know yet, but it's. There's a lot of. So like 40 ish. Right. Like it could be 39, it could be 44 depending on the organic growth in These businesses that we just haven't owned that long yet.

[B]

Yeah, no, that. That's pretty wild. I mean, there's a lot of question marks, but, you know, I think that it was accurate because as I was working with you through these. These at least first two acquisitions. Yeah, like, you did hit the Jim Carrey terrorist stage at one point of like, it was good. And then like, oh, it's hard.

[A]

Yeah. Yeah. I mean, are you guys still sitting

[B]

in that range or is it. Is it kind of evened out? Like, has it. Is your rough third.

[A]

So January was crazy. Yeah, January was a lot. You know, so it would say early. All of January was a lot. But we closed on January 1st, January 2nd or 3rd or something like that. I went out of town to visit the company that we're acquiring. In March and January 5th, we, like, began heavy due diligence for the other company. So, like, there was a lot going on in early January. And then we had to go to and from that new branch. It's in Indiana. So. And just like bringing on the team, like, meeting them and getting all the managers and like, talking to people and starting to drive our integration playbook. It was a lot of work, and I would say all the way through February. Calmed down a little bit in February, and the results in February were, like, genuinely insane. Like, I. I think we've acquired a bunch of businesses over the years. We bought three businesses back in 2021. I've talked about that so much on the show, and it like, kind of broke the. Kind of broke the business for like two years.

[B]

Exactly.

[A]

But, yeah, we went from like 35 employees to 105 in like, five months. This year we've added probably 40 employees or something in Q1, but, like, it hasn't been that big of a deal. Like, 40 is a lot, but 40 is not like, you know, as a percentage of total employees. That's like 25. So it's not like an. You know, we're not going to break from that.

[B]

How difficult that January has been versus, you know, like your. Your rough time post sale.

[A]

It.

[B]

I. I was surprised. I thought you. You were. You would have had a more difficult time on the transitions, but it seemed like, yes, it was difficult and it took your attention for a while, but there's only like a week or two where you were like, really out of it and then just like, right back into the normal. John.

[A]

Most marketing agencies will show you clicks, impressions, and maybe even traffic, but none of that really matters if the phone's not ringing. And that's why we partner with service scalers. They are built specifically for home service companies and they focus on one thing which is driving real high quality calls and book jobs. This is a no brainer. They're offering a 60 day money back guarantee on LSA management, Google business profile optimization and website builds. If you don't get more visibility, more calls and better leads, then you don't pay. If you want more book jobs without the marketing headache, click the link below and book a free strategy call with service scalers. Who's the team is a really important, important. So as you're looking at these deals,

[B]

your team or acquisition? The people you're acquiring.

[A]

Both.

[B]

Yeah, both. Fair enough.

[A]

But like hey, whose boots on the ground? If who's going to be entrusted to run this organization? Do I have an incumbent leader? Am I going to move somebody else from another branch? So I. When you're, when you're looking at like growth through eminence M and A, the leader is important. And anytime we've messed up on M and A, it has always been like 10 out of 10 times the leader, like every single time.

[B]

And that's actually, that's mine too.

[A]

So we just put a ton of energy, totally we just put a ton of energy into that. This time we're like immediately I'm coaching their managers, I'm talking to their managers every still. I, I talk to both of those managers every day for 20 to 40 minutes a day. It is a huge investment of my time and energy. But I think it has to be in order to like drive the results that we're wanting. We immediately put them into leadership trainings. We've had them to our headquarters now for we're doing monthly full day trainings. It's a day and a half of trainings and a dinner. So we're bringing them in for that. We've integrated them into our daily huddles. We've consolidated call center, we consolidated dispatch. We're in the process of consolidating inside sales. Honestly it was only really hectic for probably the first couple weeks because it was all on me. Like the first 30 days of each acquisition is really like John and then post that I start bringing in team members depending on the need of that business. Like hey, this call center is rough. Let's. I'm gonna have Lori come in and like we're gonna consolidate their call center. And Lori's amazing. So like she does it really quickly and like does a great job or like we grabbed a hold of their marketing like on day Three. And you were right. I think we argued about that in person once. But you were right. I said that on podcast. But, yeah, yeah, but like, so Jesse grabbed that and his team took it over. And so, like, as stuff peels off of me for things I have to worry about, it gets a lot easier. And I think my, my sort of discussion or argument around M and A as a growth strategy is like, where are you at in your business? We've acquired 12 or 13 companies now, and of, of the 12 or 13, these three were the easiest. And some of it was because the acquisitions targets, but some of it was because, like, our team is just mature. Back in 2021, when we were like heavy dealers, it was similar. It was three deals in a year, three deals in five months. The way that, that functionally looked is every single time we closed an acquisition, we had to bring on overhead, big overhead. Like, hey, I have to go bring on a controller. I have to go build an HR team. I have to. So, like, we'd get all this EBITDA and we'd immediately have to go invest it into shared office function, your admin teams or leadership or whatever, which, in hindsight, I probably would have done it differently, but that's what we did at the time. And I, I. So, like, where are you at with your business? I do think what would probably be a good strategy for most people is can you just buy one business a year, just every year, take down a deal, integrate it, get the muscle into your business, figure out how. What your playbook is, and then when you have your controller and your HR and your call center, like, go freaking nuts.

[B]

Yeah, yeah. No, I think it's. Once the business matures to a point where your internal business is not going to grow from organic because it's. It's ironic. I feel like we had this conversation two years ago or a year and a half ago, and the answer from you was, jack, we're not buying businesses right now, A, because of the cost of debt. Right. It was soaring. But B, the second thing was like you were saying, hey, we had bigger

[A]

opportunity inside the business.

[B]

Exactly. If I'm going to go spend a million dollars tomorrow, internally, organically, I could grow the business way more than if I spent a million dollars on an acquisition. So.

[A]

And I think that those facts have changed. I do, too, over the past year.

[B]

And I find it interesting because it's. It's like the maturity of the business has gotten to a point where you're able to really grow much quicker at a higher ebitda and higher margin through acquisitions themselves. And so as you.

[A]

Yeah, I mean, our. Our EBITDA went from like 14 to 17 or 14 to 18% to like 24 in February. And February is like death zone for Ohio. So that was really astonishing. And I don't think we'll do. It was like 23.8. I don't think we'll do 23.8 in March. It'll probably be like 21, but like still marches, you know. That's crazy. So, like, if we're doing that in shoulder season, what are we doing in peak?

[B]

Yeah, yeah, yeah, yeah, yeah. It stresses me out too.

[A]

40%.

[B]

Yeah, exactly. And then so like, okay, so super interesting. You're closing your third one in Q1. Are you going to try to keep up this. This level of momentum? Like, so.

[A]

Right.

[B]

It's working. It's working for now. You've had some great opportunities. Are you just waiting for more opportunities? Are you actively searching, like, what. What does it look like?

[A]

I think we're probably going to do another one or. Or frankly two later this year. I. We've built an incomplete map and like, there's enough distance in between these locations that we want to start connecting. Like, they're in totally different cities. Like, we're running in four locations in three states right now. And so I want to start connecting those dots so that we can share a little bit more infrastructure. And I think, like, Peterman does a great job of this. Tommy at A1 does a great job of this. We're like the hour away strategy. If you listen to some podcasts from like mid 24 4, even the Peterman

[B]

one that we did, he talks about it.

[A]

We talk about this a ton.

[B]

Yeah.

[A]

So like, our thought is, hey, how do we. How do we connect this? So I have a. I have now a branch that's three hours away from our headquarters. Let's get something in an hour and a half. Let's get something halfway in between because then we can share install capacity. Right now we're actually sharing install capacity. So people are going out there. Yeah, we have some. We have a crew out there.

[B]

This week you've talked about centralization of kind of office tasks, but now it sounds like centralization.

[A]

There is centralization of field.

[B]

Field ST is kind of wild. A wild thought.

[A]

So this isn't my idea. I'll just like walk people through what other people are doing. So they're setting up, like, I don't think hub and spoke is the right word for it, but it's the One that we're going to use. So if there's 10 locations and they're all in a chain, what does a location actually need? Does every single location need to be a warehouse? Does every single location need to have parts? Does it need to have restocks? Do you need warehouse guys? Like what do you need for each location? So some of my peers, the way they're building is, hey, I'll have 10 locations. But only four of them are warehouse locations, which means that's where their installers report to every day. And then the other six are sales locations where, hey, it's a tiny office and four guys go there or 10 guys go there or whatever. And maybe they've got some piece parts like of inventory for truck stock. But it is a sales office. So that's how we're kind of thinking about this is in between. So we've got a Toledo that's like halfway in between. And we're going to either buy or start something there. Hopefully buy. And then we'll do an install warehouse either in Toledo or in Indiana and then that will like branch.

[B]

Yeah, it's like Hoffman. So like Hoffman has the Nashville which branches down to Murfreesboro, which is like an hour drive, give or take 45 minutes. But yeah, sales office.

[A]

And it's just like a sales office.

[B]

Yeah, Downtown Murfreesboro versus And guys report

[A]

to it every day.

[B]

I don't know if guys report to it every day, but it's like branded full lettering on the top. I would assume that it's more than.

[A]

Well, the trick is actually guys reporting it to it every day because that's how these other companies. It's not just like a. It's like a real. It's a real sales office. Like there's a sales manager, there's texts that report to it.

[B]

It's just interesting because he greenfields it all. But again it. The curious part is the acquisition side, like actually buying something that's already doing $2 million in this area, probably already has that shop, probably already has that inventory or something.

[A]

I think there's a good argument to both.

[B]

Yeah.

[A]

Like we're think we're thinking about it because we have just on the very outskirts of our service area, like we're doing a million and a half to $2 million, but they're an hour and 15 minutes away from our headquarters.

[B]

Yeah.

[A]

So it's like, okay, should we just pop up a 5 tech Sal and go to town? Like I bet that 2 million could become 5 million.

[B]

Yeah, I bet it's super easy. Or I shouldn't say super easy. I bet it's easier to recruit top techs too.

[A]

That I think so.

[B]

Aren't going to have to. Hey, you guys have to drive an hour and a half every day.

[A]

I think I. I think it's. Yeah. Way easier. Yeah. So I think where's the talent? So, yeah, we will probably keep some version of this momentum up. It'll slow down a little bit. Like, we have to digest. This was a. Like, the business grew 50% in 90 days. That is a lot. We are feeling it. Not as much as you would expect, which is a little. Either alarming or awesome.

[B]

It's like the too good to be true feeling. It's like, am I missing something?

[A]

Is something about. Am I about to get shot? But yeah, it's going really well. It's going really well, which is exciting. But we've also been working and preparing for this for two years.

[B]

Yeah.

[A]

And we made sure that we were set up to do this. Like, well, like, hey, we invested in Sage intact. We invested in all the stuff we needed for service like Sage intact. Like, we're getting. We're A new business can flow into that like the second day of ownership. Like, it. It's kind of awesome. Versus QuickBooks. You know, like, QuickBooks used to be like a real process.

[B]

And. And so, like, you did mention, like, hey, we're. You're looking at two more this year. What. What if somebody wants to be your opportunity if they're ready to go?

[A]

Oh, yeah.

[B]

And they're like, kind of localized to the. What is it called? The Ohio Basin? Midwest. Like where.

[A]

Where Midwest. Looking for Midwest. So if you're Indiana, maybe Illinois, Michigan, for sure. West side of Pennsylvania, Kentucky, Tennessee. What else is down there? West Virginia maybe. I don't know if West Virginia is probably like east coast, but yeah, that's sort of like the zone that we're looking in. There's some western New York that, like, Buffalo is out here that, like, we could potentially get into. But that's. That's sort of where we're looking. And the reason that we're looking for that is when you start taking down acquisitions in new markets, you. To drive like, the maximum gain. You want to be able to consolidate every line item on that P L. Like, how can you positively impact every single line item on the P L? How do you reduce your material expenses? And this is the hard one for outside of region or outside of state. You. You now have to like, hey, where is. Where is my H Vac Equipment sold, is it sold direct? Is it sold through this manufacturer over here or distributor over here? This distributor over here. So you have to start doing cross distributor agreements, centralized chain distribution.

[B]

There's cross product, right?

[A]

Yeah.

[B]

Like you guys, your Ferguson or if

[A]

you're in different zones, like Indiana is a different zone than Ohio. So we have to now work with two regionals in order to like combine our account, drive our pricing, like control our relationship. So that, that's a part of why we're trying to stay in this little basin is we want to con, we want to be able to drive the maximum gain which it like from my. I'm sure other people can like prove this wrong, but for the size of company we're buying, I, I think it's needed. You know, if we're buying a $4 million business, we have to drive the maximum cash out of that business as fast as possible. Like basically prove the thesis we're self funding this, right. Like we're not private equity. So we have to like drive ROI really fast. So if it's a 4 million dollar business and we want a million dollars of like contribution cash coming off of that business to the headquarters, then what can we do immediately? Well, we can merge our vendors, we can merge our softwares, we can consolidate call centers, we can consolidate dispatch, we can consolidate tech stack, we can combine marketing and you can do all that really fast. And also like you can travel there.

[B]

That's, I mean that one's not.

[A]

Is it a drive or is it a flight?

[B]

I mean it's still probably, it could be a drive. Like you and I are only seven hours away. So I mean like if you're buying anything in between, between that like Kentucky wise, it's still four hours, three hours which, yeah, if you fly that's less than an hour on a flight. So like by the time you get to the airport and get down there, you are, you know, airport rental car. You're like at an hour and a half to two hours of already sunk time for flying.

[A]

Yeah.

[B]

So what's an extra hour?

[A]

Yeah, well I see I had friends, I had friends buying in like the 20, 20, 21, 2022. They were buying companies all over the US and it was a, it was a mess. I mean it was like anytime you wanted to go visit a branch, it would take. It was a real process.

[B]

Yeah.

[A]

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[B]

You know that, that or the, the windshield time can be a lot too, especially on these smaller deals if you don't have the team so like it. I mean I'm not, I don't want to overstate the fact like we almost bought that business in Jackson two, three years ago. And I remember driving out there and driving back. It was three and a half hours, an hour and a half each way, two hours each way. And like that adds up really quickly when you have to do that two to three times a week. Like talk about trying to maintain your, your full time business and then merge a secondary one. So yeah, it's still a lot, but that's interesting.

[A]

And a lot of people go multi location way too, way too early. Like I've met a lot of people at like 4, $4 million of revenue and they go multi location. And I think to my point, ironically,

[B]

you went location and you went singular location.

[A]

What? Last year we went too early. Yeah, back in 2023. Yeah, but we went too early and it was exactly that thing that I said about 2021. So just if you're thinking about doing this and you're thinking about doing this fast, like replicating what we've done in 21 when we were buying these deals and putting them together. Every time we closed a deal, we had to bring on overhead, we had to bring on a controller, we had to build an HR team, we had to build a marketing team. The reason that this is working so well and it feels less stressful is because that stuff is built and we're just adding revenue. We're like spreading less butter across more bread. Right? Like we, we are already there. That's Bilbo Baggins in. I don't remember that. I don't remember that quote. Spread across too much bread. He's describing, he's like a hundred. Yeah, it's at his birthday. Whatever. It's in Fellowship of the Ring. You need to rewatch Lord of the Rings obviously. But yeah, so the reason it works is because we have this infrastructure built. If you didn't have this infrastructure built and we were four or five million dollar operation, I think this would be a lot harder. Yeah, like I know this would be a lot harder because we lived through this back in 2020.

[B]

Oh, I wouldn't even try. Like it's if.

[A]

Well there's a lot of guys out there that are multi location and they're obviously making it work. It's just, it is harder than. So like you don't get. I don't want somebody to walk away from this and be like I'm gonna go do what John did. And I'm like ah, maybe.

[B]

Yeah, yeah. I mean the few operators who are smaller that I know that are doing this, they're running essentially two separate businesses. There are no efficiency of scale. And then that's the only way to do it is the only scale scalable part is your personal time which you put into each business.

[A]

Yeah.

[B]

But you're, you still have like fully run shops and so you don't get to see that benefit of the 20 EBITDA and reductions in HR and reductions in here because the shared services, just such a smaller piece of that. So I mean that's awesome. So that, that's next steps. You're, you're buying in the what sub 5 million. How?

[A]

Yeah, we'll go over, we'll go over it. But like that's the target. I like Midwest 5 million of revenue is a great target. More plumbing the better.

[B]

More plumbing.

[A]

As far as like the. Yeah, if you're 100% plumbing. We're going to talk to you real quick. If you're 100% H vac, we're going to approach it a lot more hesitantly. And yeah, like if you're all plumbing, like you know the one we bought was a million half of plumbing. It was a great deal.

[B]

And then on the other side to it, how are these deals being structured? I don't know if you want to talk about that real quick. I know we're already at 4 asset sales.

[A]

Yeah, they're asset sales. So you, you buy the trucks, maybe the accounts receivable depending on the deal, inventory, name, phone number, customer list and usually it's like a two to three times of earnings, maybe more for like the right deal, maybe less. If it's a tough deal. If the deal is like, in distress, there's some things you can do.

[B]

Are you looking at distressed deals at all? Because I know there's a. Yeah, we

[A]

are looking at distressed deals. So what's kind of funny is over the, over our, like, you know, career of deals, of the 12 or 13 we've done, nine or 10 of them have been distressed.

[B]

Yeah.

[A]

So, like, I don't, I don't know. I just attract you, I guess. Maybe it should, but it doesn't. So. Yeah, so a lot of the deals that we do are distress deals. So, like, if you're, if you're like, we've done deals where they're losing a little bit of money. We've been losing. We've done deals where they're losing a ton of money. But, yeah, we're not, we're not bothered by distressed. I think in the right scenario, it can be a perfect fit for, for what we're doing. Sometimes we can't touch it, but honestly, the only reason we couldn't touch a deal that's distressed is if it's distressed with, like, more than 50% new construction, then it's like, I can't do anything about this business. Like, all I'm going to do is walk in. We've talked to a few of those owners. It's like, all I'm going to do is walk in and I'm cutting 100% of the new construction out of this business on day one because that's the only way to save it. But, yeah, no, we, we do distress deals. We've done a ton of them and I honestly, I kind of like them. Like, I think it's kind of fun.

[B]

Yeah. I'm speechless off that.

[A]

But yeah, I think, I think, like, turnarounds are just like, it's in your blood or it's not.

[B]

Yeah.

[A]

And there is, it's in my blood, dude. I don't know. Like, I like it. I, I think it's fun to go in and turn it around. I think it's a race. There's like, he gets your blood pump. It's good.

[B]

I, I don't, I don't, I don't agree. Me personally, just because I don't like that stress. Like, hey, we're losing money day one. I like to buy businesses where we're making money day one.

[A]

I mean, you can, you can format it so you can get there.

[B]

Yeah, I mean, that's, that's deal. You can, you could format the deal correctly. You're right. Anyway, any last comments? Red flags, big things you want to mention about acquisitions.

[A]

Nope.

[B]

Three in three months is awesome. That's crazy.

[A]

Three and three months is crazy. I thought two and I thought two in a month or two was crazy. That's. That was easily my record for speed.

[B]

After this episode, should they go and look for the press releases of who or what you bought? Is that going to be a thing?

[A]

I should do some press releases, but no, we haven't done. I mean, just for the backlinks alone.

[B]

Yeah, no, I mean, all the big PE companies do it, and then I can see John Wilson doing it, too.

[A]

Yeah. Yeah. Ohio. Ohio, man.

[B]

Yeah, exactly.

[A]

That's funny. Awesome. Well, thanks, everybody, for tuning in. If you liked what you heard, make sure you like and sub like and submit.