The Foundr Podcast with Nathan Chan

Episode 615: Stop Chasing Sexy Businesses – This Boring One Made Me $500M+ | David Royce
Date: December 18, 2025
Guest: David Royce, Serial Entrepreneur (Moxie, EcoFirst, Altera, Aptiv)
Host: Nathan Chan

Episode Overview

This episode dives deep with David Royce, a serial entrepreneur who turned a door-to-door pest control job into four consecutive nine-figure exits, including his latest—Aptiv Environmental, which surpassed $500M in revenue. Royce shares how “unsexy” service businesses, if systematized and treated with Silicon Valley-style innovation, can yield lucrative, defensible opportunities. He discusses the myths of following your passion, building culture and systems, training and motivating teams, handling rapid growth (and near bankruptcy), and why progress—not passion or money—is his driving force.

Key Discussion Points & Insights

1. From College Salesman to Serial Exiter ([02:28]–[09:55])

• David's Origin Story:

  • Was studying finance and aiming for investment banking, but took a “crappy” summer job selling pest control door-to-door, which he excelled at after initial hardship ([02:58]).
  • “I was making $225,000 a year as a college student in a four-month summer—today’s money, probably double that.” ([03:26], David)
  • Mentor/boss encouraged him to start his own company instead of chasing Wall Street.

• First Exit and Early Growth:

  • Invested personal savings and got seed capital from his mentor.
  • Treated his first company as a lab to experiment and learn all facets—from sales to operations.
  • "I started my first company in Southern California, and it was really like a lab. It was a place where I could experiment with things." ([05:11], David)

• Blueprint for Entrepreneurship:

  • Extracted operational and sales best practices from both large and small companies.
  • Used feedback from mentors to create a "blueprint" of improvements: “He gave me sort of somewhat of a blueprint, you know, a bunch of ideas to go take and work on.” ([08:52], David)

2. Sales Mastery: The R.A.C. Framework and Building Top Performers ([09:55]–[17:21])

• From Sales Failure to Top 1%:

  • Royce struggled for a week before studying sales gurus (Ziglar, Tracy, Hopkins) and reading 90 min/day.
  • “The key thing I wasn’t doing well was closing...I created a system called R.A.C.”—Resolve the doubt, Ace (present new info), Close. ([10:32], David)
  • “You always have to ask again for the service…and have different types of closes to close.” ([11:38], David)

• Systematized Sales Training:

  • Emphasis on body language (60%) and paralanguage (30%) over the words/scripts (10%); turned training into daily events with review and peer feedback.
  • “We’d pull out a phone, record someone’s approach...If something bad comes up, say pause: ‘You’re kind of frowning right there, can you smile more as you say this word?’” ([15:19], David)

3. Systems and Scalability: Lessons from McDonald's and Silicon Valley ([17:21]–[24:18])

• Early Lessons in Systems:

  • Time at McDonald's highlighted the power of operations manuals and standardized procedures: “At McDonald’s...they had a best practice for everything.” ([17:36], David)
  • Host Nathan Chan shared similar formative experiences in fast food and wrestling with his lack of enthusiasm for systems.

• Scaling with Systems:

  • “If you want to scale a company, you have to have training manuals, job descriptions, a model—a recipe for success with best practices.” ([20:42], David)
  • Royce divided his time into A/B/C tasks, emphasizing the need to spend time on high-impact “A” activities (strategy, scaling, manuals).

• Delegation and Trust:

  • Over time, recognized the necessity to hire deeply skilled people for training, digital marketing, etc. “I needed to put more faith in people and hire those who specialized…as opposed to trying to figure it out myself.” ([23:11], David)

4. Growth, Crisis, and the In-N-Out Approach ([24:18]–[28:21])

• Rapid Growth Nearly Bankrupted Him:

  • Expanded much faster than projections; commission structure paid out before cash received led to cash flow crunch.
  • “I learned the importance of literally following finances weekly and monthly as opposed to waiting, just hoping the model was going to go well.” ([24:36], David)
  • Solved temporarily by leveraging trust with sales management to defer payouts with interest.

• In-N-Out Burger Philosophy:

  • Royce focused on being the best at a narrow set of residential pest services to enable rapid scaling and nationwide reach.
  • “Let’s not go get into restaurants, hospitals…let the other companies have that. We wanted to scale.” ([27:10], David)

5. Culture & Relentless Improvement: 'Only the Paranoid Survive' ([28:21]–[33:09])

• Continuous Improvement:

  • Inspired by Bill Gates’ “Only the Paranoid Survive”—if you’re not moving forward, you’re falling behind.
  • “A story—or a brand—is a story that never stops unfolding…there’s startup, scale-up, and screw-up stages.” ([28:32], David)

• Purpose Beyond Money:

  • Early motivation was challenge and growth; after multiple eight/nine-figure exits, purpose shifted to developing leaders.
  • “For me it was developing leaders...Gandhi said the sign of a great leader is not how many followers you have, but how many leaders you create.” ([31:03], David)

6. Building a Modern Culture in a 'Boring' Industry ([36:01]–[39:38])

• Culture as Secret Sauce:
  • Borrowed from Silicon Valley giants: “We built a killer headquarters...NCAA basketball court, golf simulator, movie room…Had NBA players and bands play, crazy company retreats.”
  • “It was not just a pest control company, it was an experience and a really fun culture to be a part of.” ([38:20], David)

7. Passion vs. Market: Why ‘Unsexy’ Can Be Lucrative ([39:38]–[42:15])

• Obsession Over Passion:
  • “People love what they’re good at…Follow the opportunity, become obsessive—passion fades.” ([40:08], David)
  • Referenced the "Stealthy Wealthy"—the top 0.1% often in boring, defensible industries.

8. Selling to the Same Buyer—Four Times ([42:15]–[47:45])

• Strategic Exits:
  • Sold three businesses consecutively to Terminex, structuring non-competes around geographies/roles that let him build new teams quickly.
  • “We took the key people, changed the name, and were better capitalized to expand…All four companies are really the same organization.” ([46:37], David)
  • Early exits provided capital for growing faster, without dilution or chasing investors.

9. Innovation in Execution: Software, Data, and Gamification ([47:45]–[50:04])

• Built Custom Software:
  • Developed in-house software for sales training, gamification (“March Madness”–style leaderboards), and operations management.
  • “We found that we could drive sales 20 to 30% higher on tournament days by doing this.” ([49:17], David)

10. Advice for Founders: Seek Boring, Defensible Profits ([50:04]–[53:40])

• Find Unsexy, Profitable Niches:

  • “Use AI right now to go ask: what are the most profitable blue collar businesses?...See if private equity is entering the space—the sign it’s lucrative and has recurring revenue.” ([50:38], David)
  • Get deep experience before launching; franchises flip the risk profile because of proven models.

• Find Industry Pain Points on the Ground:

  • “I talked to 60,000 homeowners, you learn what they’re asking for…and then you can implement that.” ([53:21], David)

11. Critical Book Recommendations ([54:04]–[56:58])

• Delivering Happiness by Tony Hsieh:

  • “If you’re going to build a business and you’re thinking long term, read Tony Hsieh’s Delivering Happiness…It saved me a lot of money because I was thinking about going to an executive MBA just to figure out that question: how do we develop a culture at scale?” ([54:04], David)

• On Sharing Knowledge:

  • Royce recounts Zappos founder Tony Hsieh explaining why he shared his “secret sauce”:
    • “I just think the world would be a better place if everybody operated this way.” ([56:23], David)

Notable Quotes & Memorable Moments

• On Choosing Boring Over Sexy:

  “If you follow passion…you really gotta be in the top 1% of 1% to do well at them. The top 0.1% of wealthy people: 43% are in these unsexy industries.” ([40:08]–[41:32], David)

• On Systematizing for Scale:

  “If you want to scale a company, you have to have training manuals, job descriptions…a recipe for success.” ([20:42], David) “At McDonald’s...they can literally almost take anybody and plug them in, and within a couple weeks, they’re trained and they can work.” ([17:36], David)

• On Overcoming Initial Failure:

  “I was awful when I started...for the first five days it’s a commission-only job, I walked around all day long talking to people, not being able to close anything—it was horrible.” ([10:32], David) “I went to a bookstore, bought a half dozen sales books...Next week, sold four the first day.” ([10:32], David)

• On Creating a Modern, Fun Company in Pest Control:

  “We built a killer headquarters…we had NBA players, DJs, retreats in Hawaii, Egypt, Thailand…It was an experience, and a really fun culture to be a part of.” ([38:01], David)

• On Progress as Motivation:

  “As long as it’s fun, interesting, and I’m growing, I’ll keep doing it…Gandhi said the sign of a great leader is not how many followers you have, but how many leaders you create.” ([31:03], David)

• On Advice for Aspiring Founders:

  “Experiment, look at what different jobs are out there. See if private equity might be getting into that space…Get experience, become the best, and only then start your business—that’s how you mitigate risk.” ([50:38]–[52:55], David)

Timestamps for Important Segments

• 02:58 – David describes his pivot from investment banking to pest control sales
• 05:11 – Founding his first company as a learning lab
• 10:32 – R.A.C. sales framework and sales turnaround
• 15:19 – Training sales teams through video and peer review
• 17:36 – Lessons from McDonald’s systems and host’s own job experience
• 24:36 – Nearly going bankrupt, importance of weekly financial checks
• 27:10 – Adopting “In-N-Out Burger” simplicity for scalable service
• 31:03 – Why developing leaders became the enduring motivator
• 38:01 – Culture-building and borrowing from Silicon Valley
• 42:57 – Selling three businesses to Terminex, structuring non-competes
• 47:57 – Building custom software for efficiency and sales
• 50:38 – Using AI and research to target lucrative, defensible, “boring” markets
• 54:04 – Book recommendations: Delivering Happiness by Tony Hsieh
• 56:23 – Philosophy on giving back and open sharing

Summary Takeaways

• Boring businesses can yield exceptional returns if systematized, focused, and approached with premium standards.
• Sales skills can be learned and systematized—Royce’s R.A.C. model and obsession with training transformed culture and results.
• Unsexy markets can provide wide moats and less competition compared to the constant gold rush of “sexy” ideas.
• Innovate with “white collar” systems in blue collar industries, invest in culture, talent, and technology—stand out by delighting employees and customers.
• Progress and leadership development—not money or passion—are the most durable motivators for continued entrepreneurial growth.
• Always begin with the end in mind (sale, scale, or legacy), and mitigate risk by gaining deep industry experience first.
• Recommend: Delivering Happiness by Tony Hsieh for understanding the power of culture at scale.

A masterclass in turning overlooked industries into nine-figure empires—by blending blue collar grit, white collar innovation, and a relentless focus on systems and people.