From Humble Beginnings to Business Success with Ismael Valdez

Summary

The Home Service Expert Podcast Episode: From Humble Beginnings to Business Success with Ismael Valdez
Host: Tommy Mello
Guest: Ismael Valdez, Founder and CEO of Next Gen Air Conditioning and Nuve
Release Date: June 16, 2025

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Introduction

In this compelling episode of The Home Service Expert Podcast, host Tommy Mello engages in an in-depth conversation with Ismael Valdez, a powerhouse in the home service industry. Valdez shares his remarkable journey from humble beginnings to building a multi-million-dollar enterprise, offering valuable insights into leadership, scaling strategies, and the integration of innovative technologies like Nuve.

Early Beginnings and Journey

Ismael Valdez opens up about his modest start, immigrating to the United States from Mexico at the age of six. Raised in a hardworking household, Valdez credits his father's relentless work ethic as a foundational influence.

“My journey started at Howard Industry. I was there for seven years... I built a ton there. I think that's what gave me a kickstart into the industry.”
— Ismael Valdez [02:26]

Valdez's first significant venture, Home Comfort USA, rapidly grew to over $21 million in revenue with 162 employees in just four years. This early success set the stage for his next major endeavor, Next Gen Air Conditioning, which culminated in a successful exit in May 2022.

Leadership and Management Philosophy

Valdez emphasizes the importance of structured management systems for scaling a business. He highlights the necessity of maintaining profitability before considering expansion.

“You got to have a structured management system inside the operation that's producing profit in order for you to even think about adding a second trade or adding a second third location. It's hard, man.”
— Ismael Valdez [00:00]

He further discusses his unique approach to mentorship, preferring competitive partnerships over traditional mentor-mentee relationships. This competitive spirit, he argues, drives continuous improvement and success.

“I think what’s driven me... is I am super competitive to a level where, like, I look for brothers and I look for... companions that are going to be just as competitive.”
— Ismael Valdez [04:33]

Dealing with Private Equity

A significant portion of the discussion revolves around the role of private equity in the home service industry. Valdez provides a nuanced perspective, acknowledging both the benefits and potential pitfalls.

“Private equity's bad. The investors are always gonna get into every industry... they just thought blue collar guys were stupid.”
— Ismael Valdez [16:27]

He explains how private equity can bring in much-needed capital and expertise but cautions against partnerships with firms that may not align with the company's long-term vision or operational ethos.

“They can get revenue and profit. But I would say this... private equity's bad.”
— Ismael Valdez [16:27]

Scaling Strategies and Market Expansion

Valdez shares his strategic approach to scaling businesses, emphasizing the importance of owning your market and ensuring profitability before expanding. He recommends a revenue threshold of $20-25 million and a strong management structure as prerequisites for multi-location operations.

“You should be at least $20 million before even thinking about that.”
— Ismael Valdez [47:33]

He also discusses the challenges and strategies involved in entering new markets, advising against overexpansion without solid financial foundations.

“Most contractors think they own the market at 2 million... What are you doing?”
— Ismael Valdez [47:25]

Importance of Profit and Financial Management

Valdez underscores the critical role of profitability in sustaining and growing a business. He shares personal anecdotes about learning the importance of profit margins and sound financial practices.

“Profit is what saves you when you get sued or saves you a car accident or saves you from a slow season.”
— Ismael Valdez [14:21]

He advises contractors to focus on both revenue growth and maintaining healthy profit margins, highlighting the dangers of unchecked growth without financial discipline.

“When you’re smaller, you’re learning. Revenue is important. I mean, you want growth, but profits? What. Pay the bills, man.”
— Ismael Valdez [14:31]

Building a Winning Team and Company Culture

A key theme in the conversation is the significance of cultivating a dedicated and high-performing team. Valdez discusses his methods for recruiting top talent, fostering a positive company culture, and ensuring employee loyalty.

“The CEO, the operator, the guy, the guy with the vision is the most important part of the piece.”
— Tommy Mello [25:00]

Valdez emphasizes the value of equitable treatment, continuous training, and creating an environment where employees feel valued and motivated to excel.

“When you run these home warranty calls, don’t ask for anything. Go in and don’t treat rich people or poor people or white people or Mexican people. Everybody’s the same.”
— Ismael Valdez [37:06]

The Nuve Project and Innovation

Towards the end of the episode, Valdez delves into Nuve, his latest innovation in the HVAC industry. Nuve is described as a cutting-edge thermostat system that goes beyond traditional models by integrating advanced features like real-time monitoring, predictive maintenance, and customer-centric functionalities.

“We were able to start units from all over your cities and states, from your office. We were never able to do that.”
— Ismael Valdez [54:28]

He highlights Nuve's superior features compared to competitors like Nest, emphasizing its potential to revolutionize how contractors interact with customers and manage HVAC systems.

“We're developing this product faster than what most products are going to get developed to. People are already buying Echo Bees, Honeywell's and Google's for $200, $250. Ours is priced around the same, but it has so many features...”
— Ismael Valdez [55:12]

Closing Thoughts and Personal Insights

In the final segments, both Valdez and Mello reflect on the importance of legacy, family, and continuous growth. Valdez shares his aspirations to balance business success with personal fulfillment, emphasizing the role of mentorship and community in achieving long-term goals.

“I want to be great at sales. I want to be a great leader. I want to be a great father... when I run these home warranty calls...”
— Ismael Valdez [44:05]

Mello echoes these sentiments, highlighting the value of accountability groups and supportive networks in driving success.

“The best part about the group that we have... nobody’s looking for anything from you... We’re all just looking to help each other win.”
— Tommy Mello [57:22]

Conclusion

This episode of The Home Service Expert Podcast offers a wealth of knowledge for entrepreneurs in the home service industry. Ismael Valdez's journey from humble beginnings to leading innovative ventures provides actionable insights into effective leadership, strategic scaling, and the integration of technology in traditional service businesses. Listeners are encouraged to apply these lessons to build resilient and profitable enterprises.

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Notable Quotes:

• Ismael Valdez [00:00]: “You got to have a structured management system inside the operation that's producing profit in order for you to even think about adding a second trade or adding a second third location. It's hard, man.”

• Tommy Mello [25:00]: “The CEO, the operator, the guy, the guy with the vision is the most important part of the piece.”

• Ismael Valdez [14:21]: “Profit is what saves you when you get sued or saves you a car accident or saves you from a slow season.”

• Ismael Valdez [54:28]: “We're developing this product faster than what most products are going to get developed to. People are already buying Echo Bees, Honeywell's and Google's for $200, $250. Ours is priced around the same, but it has so many features...”

• Tommy Mello [57:22]: “The best part about the group that we have... nobody’s looking for anything from you... We’re all just looking to help each other win.”

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For more insights and strategies shared by industry leaders, subscribe to The Home Service Expert Podcast and join a community committed to driving success in the home service sector.

Transcript

[A]

I think my rule of thumb is you got to be between 20 to 25 million dollars. You got to have a structured management system inside the operation that's producing profit in order for you to even think about adding a second trade or adding a second third location. It's hard, man.

[B]

Welcome to the Home Service Expert, where each week Tommy chats with world class entrepreneurs and experts in various fields like marketing, sales, hiring and leadership to find out what's really behind their success in business. Now your host, the home service millionair, Tommy Melo. Before we get started, I wanted to share two important things with you. First, I want you to implement what you learned today. To do that, you'll have to take a lot of notes. But I also want you to fully concentrate on the interview. So I asked the team to take notes for you. Just text notes N O t e s to 888-526-1299. That's 888-526-1299. And you'll receive a link to download the notes from today's episode. Also, if you haven't got your copy of my newest book, elevate, please go check it out. I'll share with you how I attracted and developed a winning team that helped me build a $200 million company in 22 states. Just go to elevateandwin.com podcast to get your copy. Now let's go back into the interview. All right, guys, welcome to the Home Service Expert. Today I got a great friend of mine, Ishmael Valdez, who just really, really smart guy. I would never bet against him. In fact, he called me up and he said, hey, I'm doing this thermostat stuff. And he asked, you know, we're, we're like with a group of a lot of guys. Chad Peterman, Aaron Gaynor, Cristiano Hoffman, the list goes on and on. And, and I was like, dude, I'm in. And then he said, all right, wire me the money. And it showed up the next day. And because I'll never bet against you, I mean, you're, you're a lion.

[A]

Thank you, man. Thank you.

[B]

Ishmael is the founder and CEO of Next Gen Air Conditioning. You know, he's traded that, but he's still got a lot of money in it. He's building an empire called Nuve. It's not only a thermostat, but he's doing a lot of stuff going forward with it. He's forward developing the crap out of it. It's an amazing, amazing thing. He's Building and he's helping out a lot of home service companies. So why don't we just start with. I know your story, but it's an up and coming story of how you started the business you used to work in. Well, first of all, you came into this country with nothing.

[A]

Yep, yep.

[B]

Tell us a little bit about that. And then just starting as a sitting in a warehouse selling parts.

[A]

Dude, I think we should start right there. Tommy. Look, I was born in Mexico. My family's from Michael, Mexico. We were born over there, raised over there. I got here when I was six years old. We got smuggled in here at very young age. My dad was, you know, really, really hard worker. Just, just like most of our parents are, were. And, and my journey started at Howard Industry, man. My journey started at Howard Industry. I was there for seven years. Which people that don't know what hard industry is. It's like a Ferguson's AC Pro. It's a supply house for AC contractors where, you know, most of these mom and pop shops would go in there and pick up their material, their equipment, and then they would go out there and install it and, you know, and, and, and make a profit out of it, hopefully. So I was there for seven years. Seven years, Tommy. I built a ton there. I think that's what gave me a kickstart into the industry and kind of what got me to, to accelerate these growths on these companies. You know, my first project was Home Comfort usa. I know many people think that Next Gen was my first project. My first project was Home Comfort USA. We had 162 employees. We did a little bit over $21 million in revenue in four years. And that took me four years to do. Out of the 161 employees, I think I recruited 150 of them for that operation. You know, couple years after that, after, after we, we were already at 21 mil. Ken. Ken. Which was the old CEO, not Ken Goodrich. Ken Starr was the, the CEO. We parted ways. Just, you know, he had some financial issues. And then I started Next Gen, man. You and you guys know my Next Gen story. We had a successful exit in 2022. May 5th of 2022. Tommy. May 5th of 2022.

[B]

And it's crazy, it's been three years.

[A]

And I don't, I don't know if you remember, but on the group message that we have, I sent out, I had my, I got my license in 2016, February. So it made it. My journey at Next Gen was six years and four months when we went from the day we started to. When we sold it for a ton of money. So, yeah, you.

[B]

You're definitely a student. And I don't think people understand that. I mean, who been your best mentors?

[A]

Dude, I don't. I don't think I have mentors, bro. I think I have more of a. More of, like, competitive brothers.

[B]

Yeah, no, it's a better explanation for.

[A]

Like, most people have mentors. Like, a lot of people have mentors. I don't. I don't think I've ever had a mentor that, like, has sat down with me and has poured in time with.

[B]

Me and Tom Howard.

[A]

Tom Howard was a. Was a competitive mentor, too. Competitive partner on it. He came in, obviously, in 2019 when things were going south, and. And. And obviously he helped me a ton. But I think what. What's driven me. Heights that I'm in and all the projects that I'm involved with and all the companies that we're trying to try, trying to grow is I am super competitive to a. To a level where, like, I look for brothers and I look for. For friends and I look for. For companions that are going to be just as competitive. And I think that's why me and you get along so, so much, because you are one freaking comp. Look, let me tell you something. There is one thing people don't know about Tommy because he hides it super good, because obviously he's super polished. And he's not. He's never. He's not always been that way. But Tommy is hands down one of the most competitive people in the freaking industry. There is no doubt about it. He's not a loudmouth like I am. I promise you he's not. But, dude, you drive me nuts, man. Like, I'm trying to keep up with your energy. I'm trying to keep up with obviously, like, the business side of it.

[B]

Yeah, no, it's good, man. That's what we do. We were on a bus right after Pantheon. I feel like this is five years ago.

[A]

Yep.

[B]

And we were going back and forth. You ever going to sell? And you're like, why wouldn't you sell? And I'm like, I'm not selling. Then all of a sudden, Covid happened.

[A]

Yep.

[B]

And, dude, the multiple went bam, bam, bam, bam. And Tom Howard came out and he's like, dude, I don't know if this is going to stay like this. He's like, this doesn't make sense. Guys are getting 15, 17, 19, 20. And at the time, look, Keegan was one of the best home service companies that Went out to Best Home Services. I think he got eight or nine.

[A]

Yeah.

[B]

So I'm thinking in my mind at the time when I was talking to you, Maybe we get 10, 12. Why? And then it just go boom, boom, boom. And, like, pigs get slot. Hogs get slaughtered. Pigs get fat or something like that. So it was like. And it was the best decision I ever made. But you were like, first you're like, I'm never gonna sell. Then you're like, I'm gonna do a deal. Me and you went back and forth, and we both. I mean, mine was in 2022 as well.

[A]

Yep, yep. And I remember.

[B]

And, you know, I. I got. I'm always in the right place at the right time, and that's probably because I put myself in the right rooms. But, you know, you came in one day, and I was like, dude, you were like, it looked like a muscle shirt, but it was just that normal shirt. And you're like, yeah, dude, get your fat ass in shape. And I was like, because I am competitive.

[A]

You are.

[B]

And I go.

[A]

And people don't know that, son.

[B]

I was like, all right, dude. I went all in. And I just started working on Good job, and I feel so much better. And you're like, dude, you're like, you're better than this. You could do this. And really, it sparked a lot for a lot of people. And. And I just know, like, man, he's busy as hell. He's running around with four daughters, and he's still doing it. So you're a great dad, and you make the time. And, you know, you were there every day, looking at every Yelp review, in meetings all the time. Same thing you're doing at nuve. Yeah, man, if I had to give you three things. It's competition, competitive marketing, and recruiting. And I'd also add, one thing is ripping off and duplicating. Like, you are really good at just. You pay attention, and you're like, I like that. And you just own it.

[A]

That's the one thing that business owners need to do a little bit more, Tommy, is that the. The. The small, the smaller mom and pop shops, there is so many freaking things that are accessible to them now. Between social media, between Chad, GPT and Gronk, and all these AI platforms that are. Can literally spit out a payment plan for you now. There are so many things that these guys could be doing. And look, like you said, I'm not here to reinvent the wheel. I'm not by. By any means. I'm not smarter than. Of Those contractors out there, dude, I, If I hear something, if I see something. When I was doing shop tours, like you, right? We, me and you are probably the kings of shop tours. Yeah, I've, I've gone to every shop.

[B]

Your early, early days, you showed up in your little hoverboard. The hoverboard. And then I got one because I was like, dude, I got the, I got a bigger one.

[A]

Yeah.

[B]

And I was obsessed with it. Then I'm like, I gotta get my steps.

[A]

Yeah.

[B]

Go everywhere on that thing.

[A]

Yep. So, dude, that's the one thing I learned when I was doing these shop tours. I would come to your facility, I would come to Leland, I would, I went to all these facilities and all I do. And this is a huge, A huge, A huge pointer for you guys. Okay. When you guys go to these show shop tour facilities, stop taking a million notes and trying to like, implement everything today, today, today. Or get all excited and go back to the shop and be like, okay, where do I start? Everybody in the industry had everybody. Every shop does one thing really, really, really good. Right? Like, the one thing I could tell you about Tommy's facility, they're training from the time they get somebody from the streets to the time they put a level four technician or whatever, whatever levels you got, Tommy, they could grab somebody from the streets making 20 bucks an hour. Their first year at a one, they're going to make a hundred thousand dollars, 80 to $100,000 all day long. All they have to do is have the hard work ethic. Yes or no.

[B]

Okay.

[A]

After that, they put them on this journey to getting them to making 2, 3, 4, $100,000. That to me is the one key strength that you have. Obviously the second string that I see in your, in your operations, your, your, your call center. But back to the, the thing about the contractors, guys. When you guys are going out there and doing your, your, your, your shop tours and you guys are reaching out to me, wondering who do you, who you should Visit? Go to 1. Go to each facility and just enjoy the freaking moment, man. Enjoy the moment that you're spending with Tommy. Enjoy the moment that you're spending with. If you get to go to Aaron Gainers and Chad Petermans and all these guys. Enjoy the moment and take one thing, one thing.

[B]

Yeah. Well, the implementation most people fail at. And I'll tell you this, I've started bringing my team with me. Me, we went to Morris Jenkins, we went to any hour and I told these guys, I said, by the way, before we go in There you guys are gonna get super excited. I said, you realize we're more profitable than all these guys, like literally at the bottom line. And I said, so let's not change everything. Let's decide. One of the things we were really impressed by Morris Jenkins is seven days a week till midnight. And the way they, they got their parts delivered. One of the things that we were super impressed by any hour is their uniforms and the way they work together. And we took. So we took certain things, but they, they had so much stuff. And I go, guys, do you know what we do? Really great. Like, let's just be clear on what we do. Very great. But there's. And then a lot of small companies come in and then they look at this and it's a good dream to have, but they got to know how to walk before they run and crawl before they walk. 100 and so, you know, my biggest, I say my biggest thing I've done is I Probably look at 10 softwares a month and we are the early adopters of the guys, the founders. I know.

[A]

Yeah.

[B]

That actually I could get behind just like you. Nuve wasn't going to be a great product without a guy running with, pushing it and like sitting through the pain of the weekends and the nights and showing up every day and dealing with the clients. And now you got this whole new best practices where if you're a part of the network, you're going to coach them, you're going to get the top entrepreneurs in the home service industry to coach. I just was on a coaching or whatever you call it by the.

[A]

That mentoring call, by the way, and I don't mean to interrupt you, Tommy, that mentoring call that you get, that you did for our new networks people blown away. Everybody from that call was, was DMing and texting and emailing Elva, hey, can I get Tommy's information? Hey, thank you for that. Thank you for that. So I appreciate that.

[B]

No, it's great. I enjoy doing that stuff. Just because Ken Haynes, Ken Goodrich, Leland Keegan, I could go on and on. They opened their doors for me. You open your doors. Look, Peterman opened his doors. There's not a company around that if I didn't ask, this is before I was anybody. This is when I first got on. Service titan Tom Howard with his backpack. We're both there. Darius Slivers became a good friend. And I'm like, how many people open their doors for me? And so people are like, well, how do you make money doing this? I'm like, dude, this is Called Paying it Forward. People did it for me. I would knock, they would answer.

[A]

Yep.

[B]

And if anybody knocks, I try to help out everybody. It's just what I've learned is it's the 80, 20, 20% of them you want to work with because they're actually doing the work. They're putting their head down. They actually take you seriously. And, you know, we started Home Service Freedom because I started Vertical Track, and all of a sudden it's filled with plumbers and H vac and roofers, and I'm like, this is a garage door only. So we started hsf. And, you know, all we teach people how to do is, like, book the phone calls, protect your Yelp, do these simple things, get a good brand. And most of them, they. Once they learn, they start printing money.

[A]

Yep.

[B]

They don't even know how to budget. You know, you and I, I see our weak points. Hr, not the hiring part, but financing. You know, like, dude, I'd never read Pivot Tables, and I wasn't good at reading the financials and, like, making sure we were. I was such a visionary. I'm like, I don't care if we make profit grow, grow, grow. And then I learned profit's important.

[A]

It is.

[B]

And that's later in life that, like, I've learned, because I'm like, growth, growth, growth, growth. We could get profit later, and it worked out for us, but usually it doesn't. Usually people go, so I got a.

[A]

Question for you on that. Should people scale their business, the top line, as fast as they could and then work on the bottom line, or should you be profitably year over year as a small person, as a small contractor, and grow, you know, 10, 20, 30, whatever the status quo, I got.

[B]

A rule of thumb, and it depends on how much money you have in the bank. But my rule of thumb is if you're not growing 10%, focus on if you're not. If you're not profitable at 10%, okay, now listen, A1's doing 25%, but if you're in a growth mode, I take. When you work out, this is my best analogy. Are you working out to get lean? Are you working out to gain muscle? When you're waking out, you want revenue. When you're getting muscle, of course. And at the best, people that work out, they. They're in the off season, they're putting on muscle.

[A]

Amen.

[B]

So I think the deal should be, you need revenue, but you need profit. Profit is what saves you when you get sued or saves you a car accident or saves you from a slow season?

[A]

Yes.

[B]

And everybody, they spend everything they got. And then the CPA calls and says, you owe a million dollars. You're like, how's that possible? I don't have any money. Like, this is just normal taxes. We use GAAP accounting. You owe money. And I used to get these phone calls and be like, man. And then I learned these private equity guys figured out a way to do both.

[A]

Yep.

[B]

They could get revenue and profit. But I would say, look, when you're smaller, you're learning. Revenue is important. I mean, you want growth, but profits? What. Pay the bills, man. I mean, profit. And a lot of people aren't looking at the numbers when they're not profitable.

[A]

I agree.

[B]

You start cutting certain things. You know, the guys that are not getting reviews, that are getting warranty calls, that aren't showing up for training, a lot of people that I know, they're so afraid to top grade.

[A]

And that's probably one of your strong points, too. You're. You're able to, you know, keep the good people and let go of the bad people that create.

[B]

They don't leave. They don't. They won't leave because they've got equity in the business, and they see there's something in the outcome for them. And that's. That was something I learned, too.

[A]

You bring up. You bring up private equity. Tommy, another question I've got, and I know a lot of our listeners, and I know you're invested, and I'm invested in it, too. Is private equity good or bad for the industry?

[B]

Tommy, this is my best answer, is the money will flow into anything making money. There's. There's a lot of baby boomers out there. They need to make money. There's a lot of pension funds. They go into real estate. They go into dental offices. They go into emergency rooms. They will invest in. They'll invest in a candy shop. So to say private private equity is a fancy way for investors.

[A]

Yep.

[B]

And to say. But they're very good at what they do. They've created a really good platform where they take 2% of operating and 20% of the net and they raise capital. And it's like, look, you make more money in private equity than you do in the stock market, even the s and P500, but it's locked up for five years. But the fact is, people are like, private equity's bad. Private equity is bad. The investors are always gonna get into every industry. They just thought blue collar guys were stupid.

[A]

Yep.

[B]

They were like, there's no. Like, they they figured out we were lucky, and then we made it through 2009, 10. We made it through Covid. And they realized there's really good operators in these industries, and that's why they're here. And everybody hates it because there's good, bad, and the ugly.

[A]

Yep.

[B]

And I would say this. I know it was good for you. You got a Rolls Royce. I know it was good for a lot of us.

[A]

It was good.

[B]

Look, and I know this. I know they're more sophisticated. They taught me about how raising capital. They taught me about you shouldn't have a 6% AR, not a year. 6% accounts receivable air. Now it's point 3%. They looked at my stuff because they're financial wizards, but they can't do what me and you could do. They go in and screw up a lot of companies. Yes, they do, because they don't got the eq, they don't have relations with the people. They try to cut their way to the top. But that's not every company.

[A]

That's not.

[B]

A lot of them let you take the guys out. A lot of them say, invest in what you want. Just be healthy.

[A]

Of course.

[B]

Just don't go too fast a growth because we need to make sure we've got a plan. And we're not big planners. We're like, let's go all in. So they taught me to slow down a little bit.

[A]

I seen all these comments online of like, oh, private equity came in my region and they ruined our. Our region. And now they're spiking up ppc. And, you know, they're investing in all this marketing and all this. And I'm like, sitting there like, guys, you guys should be proud. You guys should be happy that private equity is in your space. You guys should be happy that they're in. In your region. Why?

[B]

What was your exit strategy? You have no way of exiting at all.

[A]

Exactly.

[B]

And not to mention, when a one goes into a market, what everybody's kind of realized is, man, everything's easier. Like, they're at the top of the market. They've really trained the customer about a premium company. And so they get branded correctly, answer their phones on weekends, they show up and they're like, we're still cheaper than a one.

[A]

Yep.

[B]

And so all of a sudden, they double their company when a one goes in. And so, you know, they should be excited, man.

[A]

There's no reason for anybody to talk bad about private equity. Look, like Tommy said, there's good and bad private equities out there. And you know, some of them are sharks. They're just here for money. Some of them actually care about the operators inside the, the, the, the operations and, and, and the systems. But listen, stop worrying about him. Stop worrying about them. If, if there's private equity in your sector, I promise you that's a good thing.

[B]

Why?

[A]

Because they're priced out properly. They're marketing properly. So you guys should be using that to make sure that you guys are, are, are, are, are, are leading that way. You know what I'm saying?

[B]

Now, you learn a lot. You could learn a lot, and all of a sudden you become ultra profitable. Here's one thing I've learned. Losers focus on winners.

[A]

Amen.

[B]

And winners focus on winning.

[A]

Yes, sir.

[B]

And so many losers. I know, all they do is get into a room and they complain and then they bitch and then they say, the prices and the tariffs. I'm like, you know what I say? Good. I'm like, because this is going to get rid of so much competition, nobody's going to be able to keep up. Because they were complaining that they couldn't hire guys, and now they're complaining they can't get leads. Then they're complaining about. Now PE here, Then they're complaining. They've always. It's the same people that always have an issue. Every time any of that happens, anybody walks into my office that works for me, I'm like, good. Like, what do you mean good? They're like, did you realize they just doubled our prices? Good. They doubled everybody's prices. Who cares? You know, it's harder it's going to be for them than us. We're trained for this. We're trained for battle time.

[A]

And you build enough value to be able to charge for that. So look, it's talking about losers. There's a ton of losers in the industry, Tommy.

[B]

Well, the deal is I have this philosophy. Whoever doesn't make it in the real world teaches. You know why we started hsf? Because I'm still in the battlegrounds, man. I'm still in here fighting. I know what's happening. I know what macro microeconomics are going on. And look, there's a lot of people, there's some funky deals going on, and it's almost. It's like you could. But they're really good sales guys. They can sell a dream. And there's a lot of them out there in a lot of industries. Trust me. You don't think it's in roofing. You don't think it's pest control. They. Everywhere they exist in every industry. It's just, you know, certain people, they fall in love with the dream. They go on the private plane, whatever this looks like, and they sign their life away. And unlike you, I'm not a big fan of like, look, I'm not buying closed doors like you are. You talk to these guys more than I do. I don't know who's been ripped off or not. Like, I don't get into that because I'm too focused. But they come to you for in confidence and for me, I'll listen to their story, But I'm not the one that went through their Q of. I'm not the one. I've been through a lot of owners that tried to sell, that were lying about ad backs that did a lot of shady stuff too. So just as many crooks are out there trying to teach guys to take advantage. There's a lot of owners lie about their numbers. They make stuff up. I've been through deals where their financials weren't even close to what they were reporting. So I think there's bad actors in everything.

[A]

So, so what would you do? What would put yourself as a contractor? Right. Everybody wants the five to $10 million contractors because they know they're a couple tweaks away to, to 20, 25 mil. And that's where, you know, you could get a good profitable flip. Right? So you're a 5, 10 million dollar contractor. What are you doing? And these guys keep approaching you and obviously whether you're in a good or bad spot and you're looking for help. What are the top three questions that you're asking these gurus in the industry, Tommy, without, you know, calling any names or bashing on them, what are the top three things that you're out that you're, that you're asking to be able to make sure, hey, this is the right mentor for me or this is the right leader for me, or yeah, I'm interested on it. Right.

[B]

So number one is there's a way to prep if you're ever looking to make something and a lot of people don't do this and they lose out on a lot of value. Number one is getting audited financials. Number two is doing your own quality of earnings that you're prepared. Number three is having service titan. I got to tell you, when somebody's on house call, pro or jobber, that's okay and I get it, but you're going to get devalued because you don't look like an affluent business person. I mean, you Just don't. Everybody gets you. Every platform will get you in the home service industry on service day. You got to be on the right payroll software, like there's certain things you just have to do so prep first. Secondly is when all these different PE companies approached me, I went and flew out to see who they worked with, what their success story. And I looked at their financials. They open up the doors to me. Tell me all about your success stories. What's the good, bad and the ugly? And you better tell me some bad and ugly.

[A]

Cause if you don't have ugly, what, they're lying. Of course.

[B]

But the track record, like when I work with a vendor, I want to talk to 10 people you've worked with and I want to, I want to hear from a couple of people that you either stop working with or they fired you. And that's the fact is I flew out to so many businesses that worked with Cortech and they told me they're very hands on. They're going to tell you no, they're going to, they're going to expect you to be super humble. And I said, fine, I could be all that. And they taught me a lot. And they were really worried. They said, dude, I'll be honest with you. They told me this. They said, 10 companies have called us and asked me what it was like to work with Tommy Mellow. Everybody wanted to see if they could tame the beast. And they're like. But you just sit there, you listen, you ask great questions and you do. Exactly. And they don't tell me what to do. They just say, have you ever thought about it this way? Or why is this ar or what can we do about this? Or have you ever thought about renegotiating with this guy because your cost of goods is out of control? And that's what they do. That's what a great partner does. But they said, we didn't buy a one, we bought you. And they did buy. They did buy, Luke. They bought. Trust me. They brought Travis Rackley. They bought. They bought our team.

[A]

Yep.

[B]

But the deal is, is if I stop showing up, if I start taking vacations and just disappear, you know, these guys are loyal to me too. So the founder leaves.

[A]

Did we know what that. We know it's not a good situation. We know what that leads into. Right.

[B]

Anything that's complex that I can't go explain to my significant other, that's like, well, I get an earn out here, they're going to add this back, they're going to do this. That's always makes me fishy. Like, first of all, it should be a very, very easy, easy earning out.

[A]

Yeah.

[B]

And it should be I getting a lot of cash up front.

[A]

Yep.

[B]

And it should be, what's my upside? Of what, what upside have you done this with before? Like, where have you done this before? Is this your first rodeo? And a lot of people are taking other people's credit, you know, whether you worked for Ken Goodrich or whether you worked a lot of people work for a lot of people. And, and you know, Ken. There's so many guys I know that have worked for Ken. And Ken's a beast dude.

[A]

Ken is probably one of the most respectable operators out there. And there's a lot of scumbags out there talking bad or trying to take credit for what he did. It's, it's no different from one of your guys saying, oh, I built a one, or one of my guys saying, oh, because of me, next should happen. And I've heard stories like that about me. I've heard stories about, like that about you, about Ken Goodridge. Look, at the end of the day, guys, the CEO, the operator, the guy, the guy with the vision is the most important part of the, of the piece, whether people want to see it or not. So I hate these scumbags out there that are, are always like, well, I, I built ghetto and I build next gen and I built this. It's like, no, we didn't. Look, I don't even say that. I've never heard you say because of me. A one said, oh, no, I've never heard.

[B]

You're only as strong as your team, as strong as your weakest link. In fact, I needed to step back and say, look it, I am fireable now that I work for private equity. I mean, those are the facts. And I just say, guys, you know, I'm the driver for sure. But my biggest goal, There's a great book, book by, what's it called? Built. Built, not built to sell. That's John Warlow. There's a great book called Built to Last by Jim Collins. And this idea should be, if I were to leave the company, it would do better because I put all the right people in place. Now if somebody comes in and starts firing everybody and gets rid of all my installers and does all the crazy stuff, it cuts to the marketing. That's not good. But what I'm going to do, if you're going to let me go, can you give me six months as a consultant to make sure we're leaving this in Great hands. Because this is. My face is on the side of it.

[A]

Of course. Amen.

[B]

I want this thing to live on because there's a lot of families. If there's 900 employees that are taking care of three people, there's 3,600 people we're taking care of. So can you please. I like, if I did something bad, let's. God forbid I got in a really bad car accident and some bad happened and you can't operate, we need you to be out because it's too bad publicity. I would ask, could I work from a distance just to make sure that these families are taken care of.

[A]

I got a good question for you and Aaron Gaynor. Put this on a group chat. That and which, which is with what you're saying, something bad happens to you, God forbid, nothing happens to Tommy. Obviously we, you know, we all appreciate what you do in the industry, Tommy, but God forbid something happens to you and the new CEO is walking in. What do you tell that CEO about your company about? Hey, this is what you need to focus on. What are, what's that convert? What's that 5, 10 minute conversation?

[B]

It's a very quick conversation of. Look, there's a lot of people that I entrust in this business the most one is Luke and my CFO Adrian. And I go, they understand how I run stuff. But what's going to happen is you're going to change the culture to your culture because now you're running the show.

[A]

Yep.

[B]

And all I'd ask is, listen, these guys know how to run without me, so give them a lot of latitude. Let them do what they do best, where I do my best, where you're going to have to fill in for is there's certain vendors that I've got 10 year plus relationships and I give them everything to make the decisions, but I hold them accountable. And I'd say, listen, here's what you need to do. A great leader, you need to rally the troops. You need to get them excited. You need to see what's in it for them. You need to make sure their families are taken care of. You need to make sure if they want weekends, they're going on the trips they want to, they're buying their first house. Because if you start to extract money from this company, they will be gone in a New York second. In fact, there's, and I don't say this with any pride, there's at least 40 people a month that reach out to me to say, if you were ever to step down, I'm Going if you decided to be a garbage man, we're going with you to do garbage. And I'm like, yeah, but I want you. I don't want you to be loyal to me necessarily. I want you to be loyal to this company.

[A]

Unfortunately, Tommy, that is one responsibility that carries with you for being a great leader. Same thing with me. You know, I stepped down as CEO of Nexion a couple years ago and. And there was people that told me the same thing, hey, if you ever leave or if you ever step down or if whatever the case is, like, I don't think I could be here. And you know, unfortunately, I had to step down. I had to. You know, I had other visions in mind, like my project Nuva, that I couldn't. That I couldn't.

[B]

Yeah, well, you. You know, when I went to your shop, first of all, you were feeding everybody. You had a truck there every day. I was there. You were. People were winning, Raptors, you go give out. You had every guy walking in, you were throwing cash to somebody had a hard time, you were figuring out a way to make it work. And one of the things that I think that, look, this is not because you're Spanish speaking, but I will say everybody gets students in California, what they figured out was Ishmael's came from where we came from. He takes care of us. And if one guy takes, screws it up for us and they sue because of a mistake, a clerical error on a payroll, then all of us go down. And I think they kind of self governed each other.

[A]

Yep.

[B]

And that's why you didn't. You know, I'm sure you got sued in California a couple times, but nothing that took down the ship.

[A]

Nothing, man, nothing. And I'm. I'm super proud of that because that culture that I built there was. People saw me serving them every day, day in, day out. I would show up to the shop at 5, 6am every day for, you know, six and a half years, seven years, I'll show up. And the reason why we didn't get any lawsuits, the reason why we weren't any legal troubles, the reason why is because people would see me there. And you know, five, six in the morning, I'm packing up the installer's truck, I'm grabbing, you know, the yetis, you're.

[B]

Taking care of them, of course, and you paid more. And, and also, like, you understood, like, look, we're gonna get this. But I feel like they didn't feel like you were just chasing the dollar. Although, listen, everybody wants to make Money for their families. And you want to set up your daughters, of course. But there's an idea of like, dude, if I sit on the top of the mountain alone with a magnum bottle of champagne, like, that was pretty lonely. That was the end of my career.

[A]

Pretty lonely, man. It's pretty. Did you ever think that. That this was going to happen to us? Tommy, you know, me and you are pro, and I mean this in the most humble, respectful way. Me and you are probably some of the most influential voices in the industry. Did you ever think, like, man, one day this is going to happen?

[B]

Hey, guys, hope you're loving today's episode. Let me ask you something tough but important. What would you do if your phone stopped ringing tomorrow? Most owners would panic, but I've got a few proven strategies to make sure that never happens. On June 23, I'm hosting a live webinar where I'll walk you through exactly how my top performers turn one job into 20 new leads before they even leave the driveway. My right hand man, Jim Leslie, and I will show you how to build a business that keeps growing even when prices go up and the competition gets tougher. Join our Facebook group, the Home service Expert, and watch for the announcement. All right, back to the episode. You know, when I was a kid, I used to listen to my mom and dad argue about bills. And I just decided I need to remove money from. This will never happen to my family. They'll never get a divorce. My dad cheated on my mom. He drank a lot, but he was the best dad ever. And I'm golf with my dad two days ago. And I said, man, I'm like, I'm glad I didn't. My dad's a mechanic. He ran transmission shops. He did a great job. He took care of me. But I'm like, I found a niche. I made a lot of mistakes. I'm an overnight success of two decades. But I didn't know. I didn't know what multiples or arbitrage was. I didn't understand how to build a business. I wanted this. I was pre dental. I went to school. I took anatomy, physiology, biochemistry, organic, like you name it. I took advanced calculus. I mean, can you imagine me as an orthodontist? I would be like, dude, so, like, I don't know. But I think, you know, I'm pretty spiritual. And I think God has a plan. And I think he hasn't even begun to use me yet for the what I was meant to do. I'm not a dad yet. I'm not. I was put on this earth to be a father.

[A]

For sure.

[B]

You were.

[A]

So I can't wait to see that version of you.

[B]

By the way, my best things haven't. You know, God forbid if I do something bad happen, which, you know, tomorrow's not promised. As something I learned. I do believe my legacy is going to be my family, but, you know, I can't. I can't be sure because, you know, all I could do is marry Bri and start having babies, but, you know, I want. I wanted to grow up in a great. The hard part is when you have this much money.

[A]

Yep.

[B]

And I say this with the most humble. I want my. My kids. I want them to fight. I want them to go through not exactly what I went through. Definitely not what you had to go through. I mean, but at the same time, I don't want them to be like, dude, yeah, come to this 50, 000 square foot house, and they're friends, and they're driving first class on private. Like, I want to figure out how to instill. Yeah. It's just such a hard thing. And I don't know, how do you. How do you manage that?

[A]

I'm. I'm in that midst right now where my. Where my daughters know they have a good life in it, and I can tell they have that little attitude of like, hey, you know, but. But then I also. Look, my number one thing with my daughters, and I'll give you this as a. As a humble friend to you, Tommy, is I am a mirror of what I want my. My daughters to see every day. So if you ever see me around my daughters, bro, I am serving them, I am picking up napkins. I am picking up plates for them. I'm grabbing the thing, I'm grabbing clothes for them. I was. I was at a. I finally took them out to San Diego, to this new resort in San Diego, which had a bunch of water slides and everything. And there was four couples in back of us in a. In a cabana, and it was my daughters. Myself were, you know, they were just chilling. And the guy comes up to me after, like, five, six hours of looking at me, and he said, hey, man, you haven't sat down for more than one minute. You've been grabbing towels, grabbing food, you know, putting sun lotion. Are you gonna sit down and enjoy your vacation? I'm like, nah, man, not when you have four daughters. I want them. I want them to. I want them to. To. To see how they should be treated every single day for their life. And that's the Way I. I parent my girls.

[B]

No. No. Well, that's good. It's going to be hard for anybody to date them because you're going to be a tough critic. And, you know, if you have. You know, if I have a boy, it's. You treat a woman right. That's what my dad taught me. I mean, look, he made mistakes in his life, but I. You know what? Everybody does.

[A]

We all do.

[B]

And I don't hold him. I don't know what it battles. He was going through a lot of demons. Everybody has that. So I just figured, dude, I only cared about money just because I saw rib, my family apart. And then I started seeing fitness and faith and family and future self and. And the. The finance kind of. What. What is the only thing you could really delegate? You can't delegate your fitness. You can't delegate your faith. You can't delegate family. You can't delegate learning. No. You can't delegate fun. You could delegate finance, believe it or not. You could. You could get great people on your team.

[A]

Yep. And they'll.

[B]

And you build financial.

[A]

Yep.

[B]

And look, I could go out of town, I think my dad on a golf trip next week.

[A]

Good for you, man.

[B]

And it's a. With all my cousins, I'll be gone for a week, and then I got to go to Milwaukee for a management meeting. Do you think that I'll log into Service Titan and everything's going to fall apart?

[A]

No.

[B]

Do you think I could be gone for three months and they won't skip a beat?

[A]

They won't skip a beat.

[B]

Our whole team goes to Mexico for a week. All of my C suite, my manager produces, my top 40 technicians in the company, and installers leave for a week. You know what's funny is all the other guys think they're getting the best jobs now. And we hit the same exact numbers. They're like, now that they're gone, we're getting the good jobs, which is a fallacy.

[A]

Of course it is.

[B]

But it's crazy to me because you would think your top 40 producers, your whole management team is gone for a week. We don't lose the thing.

[A]

Of course. And guys, look at what he just said. This is. I don't want you guys to skip over what he just said, because this is the type of competition that you guys are against in the. In the garage door industry. This is the type of comp. Tommy is taking 40 of his top technicians to Cabo, his executives, his managers, everybody, for a week, paying for everything, housing, food, everything. And they're Having a blast. You posted a bunch of videos on, On. On your. On your pinnacle trip that you do every year. And guys, this is exactly what I. What I'm telling you, and this is exactly what I mean. When the way you recruit the top people is doing stuff like Tommy does. He pays the best, he trains the best, he treats them the best. Like there's. I guarantee you, if I talk to one of your technicians that just started a month ago, Tommy, they know exactly the pathway to getting to being a top. A top performer.

[B]

And they all got my cell phone number. And the other thing is that they got a chance to get equity in the business. And the other thing is, I teach these guys to be killers and ask for everything.

[A]

Amen.

[B]

They ask for everything, which means when I teach them that, they're going to ask me for more, of course. So the top guys that make more money than I do of a salary basis and with commissions and whatnot, they literally. You can't teach them to be lions and then say. They say, what's next for me? Where could I do more? How do I make more money? And I'm like. And I gotta always be coming up with ways and new strategies for them to.

[A]

That keeps you on your toes, though. That keeps you on your toes.

[B]

It's like they always want more. And guess what? I always want more. And would you rather somebody say, I'm just fine in the corner, but they're not trying.

[A]

Yep.

[B]

So you teach. I always say this. Look, you can't teach a guy to say, hey, listen, I want you to go hard. I want you to ask for everything. But, hey, listen, when you run these home warranty calls, don't ask for anything. Like, you got to have specialists, you know, so you got to understand. Exactly. You can't teach to be one way to one thing, one way to another. If it's a little old lady, treat her differently. You got to go in and don't treat rich people or poor people or white people or Mexican people. Everybody's the same. Give them all the options and let them choose.

[A]

Amen. And that's one thing that you guys got to learn as contractors, is that it's okay for them to make more money than you. Look at the beginning stages of next gen air conditioning. When I was growing it, dude, I wasn't. I was paying myself $2,000 a week just to be able to pay my bills and my rent and my. You know, I think we had a Mercedes, a used Mercedes back in the day. And some of the sales guys Were pulling in five, six, seven, eight thousand, ten thousand dollar checks a week. And I'm like, God, most, most contractors, though, Tommy, are not okay with that. They're like, well, how could the sales guy be making more and how could.

[B]

This technician be making time? And I'm like, guys, they don't, they don't understand their enterprise value. They don't understand what they're trying to build.

[A]

Exactly.

[B]

They don't even understand if to not have a plan to sell or at least understand how your business is valued is such a mistake that I was in for so long.

[A]

We were in for some.

[B]

Yeah, I didn't know what I. But. But literally like the lights started turning on and you hear about this exit, this exit, and then you build it in a certain way that it could be sold even if you don't plan on selling. But there's certain guys that are like, I'm never gonna sell. And I'm like, you know, Cause I do believe that literally people lose their DNA when they sell. A lot of people, most people do. But I'm like, you know, you think I'd be sitting on a golf course? Of course I want to go golfing, but you think I'm going to disappear into the Bahamas? I will keep. There is more opportunity. Look, it was Ken Goodrich that called me up. He said, dude, I would do a deal. And here's why. You are one of the smartest guys I know in home service, but you don't know shit about raising capital. You don't understand how to use debt, you don't understand what an LP is. And he's like, dude, when you learn that, with what you know of all of this, yeah. He goes, you're half of it. But this other half, if you could just be a sponge, he goes, it's going to be nutty. He goes, do you know how to do a deal? Do you understand add backs? Do you understand quality of earnings? And at the time, I just barely could scratch the surface. Now I'm like, huh? I'm like, let's cortech. I called them every day and I was like, so you guys are in the Middle east right now raising debt? They're like, yeah, we just got a pension fund and here's how it works. And so I would call them, I'd invite them to spend the night at my house and I'd ask that. All I would do is they'd be like, ask questions. They go, dude, it's 11 at night. Like, I gotta go to bed and I'm like, one more question.

[A]

One more question.

[B]

And a lot of people are like. They're just like. They got it all. You know, the. The dumbest people in the world think they know everything.

[A]

Amen.

[B]

And the billionaires I know are the. They. They sit there and they'll talk to a guy. They'll talk to a server for 20 minutes and ask them why they work there, what their goals are, do they have kids?

[A]

I've noticed that, too.

[B]

And they ask the best questions, and they learn. They're always learning. Every time there's been a real issue with this company, it's been me. And it was so easy to point my fingers. I let that happen. I let the guys not drive safely. I knew they weren't driving safely, but they were top producers, and I let them. God forbid something bad happened.

[A]

You know how many times that happens in every company? You know, it's a top producer, it's bringing in revenue, and you have. You've done it.

[B]

I fired top four top producers, and I put up with a lot. A lot.

[A]

We've put up with a lot. We've had it.

[B]

And then, because we were ignorant. Well, you let it happen. And then the whole tribe gets very disheartened, and then you let that person go, and you're like, man, I should have done that six months ago. And there's a fear, though, because there was one point in my career where if I lost this one guy, I'm like, I don't know if I'm going to be able to pay the bills. And Adam walks in, and he goes, I'm firing him. And I look at him and I go, okay. And I was so scared because I'm like, dude, what happens when these marketing bills come in? I got a truck payment. I got this stuff, and I was so worried, and you'd be shocked, dude, he goes. He's so disrespectful to you and me. He. He. I literally rolls his eyes when he comes in. He misses meetings, and he thinks he knows everything, and the whole place is watching them do that, too.

[A]

Yeah.

[B]

I said, you're right. So let's do it. And we didn't skip a beat. And then that's why I was like, fine. Nobody's untouchable. Nobody.

[A]

At what point, Tommy, did you go from. Did you go from. Or do you still remember when you were, you know, struggling to. When you were already, you know, thriving? Do you still remember that point where you were, like, you said, struggling to pay the bill, struggling to pay payroll?

[B]

I'll tell you one story. You know, me and Keegan have known each other a long time. And Keegan goes, would you mind if I came down to your shop and just checked. Checked it out? And this is. It was 2018, 2019, somewhere in there.

[A]

Yep, same.

[B]

And I go, yeah. And he's pretty smart guy. Like, he. He's really good at understanding finance.

[A]

I met him once, by the way. So he. Yeah.

[B]

And he goes. He goes, hey, can I just see every market? Can you put it out on this conference table? And can you put out. So my CFO goes, there. He grabs the balance sheet of the P and L, and Keegan goes out there with a highlighter. It just starts highlighting. He's doing his thing, and he looks up at me with disgust, and he goes, you need to close these four markets today. And I'm telling you, Ishmael, I don't care if it was gc, Jesus Christ, I would have not closed those. And he goes, you're bleeding and you're gonna go under. And I go, keegan, it's just bad management. I could fly out there. I could do this. I could do this. He goes, tommy, close these today and offer your guys a reload package today. And I'm like, but, but, but. He's like, no. And I was like, shh. So I closed down Atlanta, Dallas, Houston, and Tampa the next day. And I started printing money like nothing I've ever seen before.

[A]

Amen.

[B]

And look, I've had a lot. A lot of people do that for me, though. Al Levy came in. I've had a lot of people. Ara didn't let anybody on service 10 outside of H vac, plumbing, electrical, we were the first company. And he goes, why would I let a garage door company and my father does H Vac? Like, this is what we're focused on. I said, you bet on me, I promise you I will have more technicians. And he goes, tommy, I can't do that. Fifteen minutes later, he goes, you know what effort? He goes, I'm going to send you 10 success managers. This was 2017, and we didn't have a price book or anything. We had to come up with it. And we're working with Matt Rule and all these. You know what I mean? You know Matt and. And why did that happen? Why did he bet on us? Like, a lot of people, like, it's crazy because of that, but it's. It's just like, no, obviously I believe in Jesus. And he's opened up a lot of doors, of course. And I feel like, literally, I could Tell you this. I feel like I'm in the early stages. Like, so many people are like, what are you going to do? How much? Why do you keep going?

[A]

Like, you're just getting.

[B]

People say, what's the finish line? How much money's enough? My mom had asked, how much is the. Is enough? And I said, mom, I go, do you think Tiger woods. Mom asked him, when you won four majors? Four majors, you got to be done, right? You hit the grand slam. I'm like, this is what I live for. Like, I don't get in a room and talk about sports. I don't get in a room and talk about.

[A]

Like, do we talk about.

[B]

We talk about business?

[A]

How do we freaking. How do we help each other?

[B]

I don't know what money. It's an obsession.

[A]

It is.

[B]

And I was with a guy yesterday, and he goes, you know who's the most successful people? The people that get obsessed where they can't sleep, where they're just. They're going to go all in. And he goes, there's seasons of life. I don't know if you ever heard of Russell Brunson. But he. Russell Bronson. Clickfunnels. You sit right where you are. And he goes, tommy the obsession. But he goes, when I go home, I'm a different Russell. I walk and I breathe in my car. And I go, new Russell. I'm Russell, dad. But he goes, look, there were places where I had to be obsessed with different things. And I think a lot of people are trying to be so balanced and trying to get to know the things they suck at. I never want to become a good cfo. I'm not saying I want to become a great marketer and continue to become the best marketer. I want to be great at sales. I want to be a great leader.

[A]

You want to be a great father.

[B]

Yeah. Those are the things. I want to be in the best shape of my life. And really what I want to do is when I'm sitting on my deathbed, I never want to have to wonder, I wish I could have gone harder. I wish I could have tried more. I wish I could have. Like, I want to say, I went all in on everything I did, and if I could do that, then I consider life a big win.

[A]

Amen. Amen. Look, I want to get back to the. The location thing, because that's one thing that we always. That we as operators always struggle with, Tommy, is when. At what point do you go to a different market? Do you open up a micro location? Do you open up A second location. Because most of these guys.

[B]

Look, I know they're all asking.

[A]

I've mentored a million guys, Tommy, on these.

[B]

What are you doing? And just Southern California alone. Now, I know you had different locations.

[A]

But we had six operational locations with, you know, warehousing and installers, technicians, sales guys in there. And then we had three micro locations just to be able to lead, generate on them.

[B]

So, Paul and we talked about that. I remember when I told you, like, you got to do that, but Paul Kelly is going to do over 300 million in Phoenix.

[A]

Yep.

[B]

Right. You know, here's the coolest thing about being where you live. You go to church there, your kids grow up there, your best friends live there, you know, all your neighbors. If you don't own that market, you think it's going to be easy to go to the next one.

[A]

But most contractors think they own the market at 2 million, Tommy. Most contractors. Actually, I've had contractors say, Ishmael, I'm. I'm already. I already dominate where I'm at. I'm in Dallas, Texas, and I already dominate. I'm like, how much revenue are you doing? $7 million. What? Like, I'm gonna open up one in Houston and one. I'm like, there is millions of people in Dallas, Texas.

[B]

What about guys.

[A]

Exactly.

[B]

Doing over 100 million.

[A]

Exactly.

[B]

So at what point my question is, own the market. So they're like, look, what's the armpit of California?

[A]

24 million.

[B]

What's the armpit, though? What's the armpit of California? Fresno.

[A]

Yeah, exactly.

[B]

How much does Tom Howard do?

[A]

50 mil. Probably 50 mil.

[B]

So the idea is people always blame their market. They always say this. Yes, if. Let me tell you this, if I was in Sedona, you got Flagstaff. I say, look, that's a smaller market. I probably got to hit a major metro if I want to get to, like, the tens and tens and tens of millions. But here's what I find. When I went to Tucson, I was taking my best guys from Phoenix and sending them to Tucson. And I was robbing Peter to pay Paul. And I was trying to grow too fast. And this idea of, like, you need to make a lot of profit, you need to be at 22% profit before you're going to go. And it needs to be millions and millions of dollars of profit, of course. And then you move slowly somewhere where you get to. With an hour to 2.

[A]

How much do you sustain that? 20 plus profit before you go into a different market? Do you just, you know, after you.

[B]

Depends on how much, how much money do you got in the bank? So look, look, at the end of the day, here's the deal. Own your market, get the reviews, get multiple locations. Like you should be at least $20 million before even thinking about that.

[A]

That's what I said. I think my rule of thumb is you got to be between 20 to 25 million dollars. You got to have a structured management system inside the operation that's producing profit in order for you to even think about adding a second trade, adding a second trade or adding a second third location. It's hard, man. It's not easy running multi location shops.

[B]

And then the other thing is like people don't understand the difference between home service and home improvement. Like discretionary versus indiscretionary money. Like if you're window washing or painting or doing water systems versus your pipe breaks, your air conditioner goes out, your garage door is busted. Like when the, when the market really gets bad and it eventually always does, which it gets, great, they let go those companies, they struggle so bad. And I think people need to realize the reason why we get a premium is because we're demand driven. We're a premium. So we can't have AI answering the phone. Yeah, if you got a landscape company that everybody's calling you weekly to mow your lawn, you'd have AI answer that at the dentist office. But trying to do AI when you're busted and your pipe just broke, certain people are like, I'm just gonna get AI to answer the phone. I'm like, yeah, good, tell me how that goes.

[A]

So tell me about it, tell me about it. Because look, there's been a ton of talk of when CSRs are going to get out of the operation. Right. Service titan's working on their own. I know there's a ton of good companies out there that are, that are doing the AI, the customer service service titan.

[B]

And I will tell you that I think AI needs the assistance of humans and vice versa for the next 18 months to two years. And I think it needs to learn from the humans and then we're going to learn from the AI and it's going to be a symbiotic.

[A]

Do you start now though? Do you start your. If you're a ten million dollar shop and you're just, you know, you got ten, five CSRs inside of the operation, do you start doing well?

[B]

The AI will listen to the calls and they'll disposition the calls and they'll start scoring your calls and they'll start, they'll start Kind of coaching your team.

[A]

Yep.

[B]

But I would never. I would. Where AI is right now? If we did a quick phone call and you said, thank you for calling A1 garage door service. And you said, hey, my garage door, Spring break. How much would it cost to go? Oh, very good. What's your address? And it's still. It's not there yet. It's just not there.

[A]

Yep.

[B]

And if you start now, people say start nights and weekends. You're still throwing money away. Have an after hours call center first. It's just not there. Nvidia is coming out in a year is going to be so much further. So be a little bit patient. Make sure you pick the right companies. I mean, you can look at a guy like Sebastian. That dude is on the road. He's got great team. Like, he's a go getter. Like, I go, I get behind people that are go getters that are like you.

[A]

Of course.

[B]

Like, I would have never like, dude, Tom Howard said it was a long shot. He goes, there's one guy on the planet that could work this out. He goes, Ishmael Valdez. And dude, nobody in the beginning would have bet. I mean, dude, it was a lot. And I gotta tell you, you were like investing in like house cleaning and like sushi bars. And then you're like, I'm gonna go all in on this. And dude, you had some, like, nobody knows this, but you came to my house and you were almost in tears. You've had some things go wrong, which everybody does, and they built. You're stronger.

[A]

I was.

[B]

And that business is going to be worth it. I mean, you text me an ARA buy all the time and you're so competitive and you're like, who's going to be a billionaire? And I love that. But you know, here's the deal. I always say, look, how do I, what do I do to help, like the people around me the most? And you know, for me, money is just this tool that when we go to Idaho, you got a place out there.

[A]

Yeah.

[B]

When we do stuff like, I'm building a pretty big place right now. I got six guys staying with me. You know what I mean? Like, you stay with me, you're more than welcome. You left a car at my house for a month.

[A]

Yep. But.

[B]

But like, the idea is I'm not doing this to say, look at my house. I'm doing this to say this is a sanctuary of fun and relationships so we could build a work together.

[A]

Yeah.

[B]

I mean, I lived in a thousand square foot apartment for four years. Tom Howard used to go sleep. Sleep on the couch and whiteboard with me till 11 at night. And I'd be back out there at 5 in the morning. And I wasn't embarrassed I had other houses. It's not that my possessions don't. They're not who I am. But, yes, I like nice things. I want to be able to get to a place faster and in comfort. Like, it was selfish of me not to have a driver at a certain point. Of course, it gave me 12. 12 hours a week.

[A]

I told you about a driver, about.

[B]

A chef told me about this stuff. You got into great shape. Like, you doing certain things. Definitely have pushed me.

[A]

Good, man.

[B]

I mean, you've been a positive influence. And it's a lot. I will say Janos Ringy. Like, Gaynor and I became really close. Like, that group we've got. Hoffman's a genius. Like, there's nobody. I wouldn't say there's anybody in there that. I'm not like that. Like, I'm not happy. And I gotta say, you. I didn't know Hoffman. I didn't know Peterman very well. I knew Gaynor. And it just all of a sudden, I know you do other groups too, but all of a sudden you threw that together. And the cool thing about it is we give each other everything.

[A]

Oh, yeah.

[B]

Screenshots of what our revenue is, what our top guys are. If I ever want to talk to somebody, stop Guy. Fly him out here.

[A]

Yeah. We asked for advice on the group. We hold each other accountable. So that's one of the cool things that we built on. On.

[B]

And these are friends for life, man. And the deal is, is, like, the problem is we're such big builders. We're so, like, we're always in the midst of something. And plus, there's kids coming. And, like, you guys got kids. But we are like, I. I got this grand idea that, like, we're gonna do some cool stuff. Like you. You've done some cool investments with some of these guys already.

[A]

Yep.

[B]

Real quick, I got to run here, brother, but talk to me about nuve a little bit, because literally, like, look, I don't care if anybody uses nuve. I got behind it because I think it's damn good. And I think it's. It's the leading tech. And I know you're not the guy back there doing the software and, like, making all the innovations. You got ideas because you understand what it's like to be a business owner that's doing 100 million. So you built Nuve in a way you were. You guys sick of paying all these companies for marketing and you want to own the customer. So I think there's still a lot of skeptics out there.

[A]

Yeah, look, Nuve was a product, a project that was brought to me, you know, three years ago. And I've been pouring my heart into it because I, I saw a huge, huge gap in, in our industry, Tommy, where customers have the same, the same behavior every time they need an air conditioning. Just like the way they have the same behavior every time they need a garage door. Right? They go to the garage door, they press the button, it sounds weird or it doesn't open. And what do they do? They grab their phone, they go on.

[B]

Google stickers work, but they never really worked for H Vac. No thermostat. To be locked out, to be able to check the unit before the heat. My business isn't seasonal like yours. It's like the smartest fricking thing in the world. And now you sent a text message the other day and it was like, you're telling them the health of everything, the air quality, like the crazy stuff, the innovations you guys are making. And like, I think you're better than Nest. I think you're better for the contractor. I think that this potentially is a multi, multi, multi billion dollar company.

[A]

It is. And look at some of the innovation that we're working on in there. We brought a Carfax report for the AC units that we're actually going to be monitoring, you know, repairs, we're going to be monitoring investments into maintenances, we're going to be monitoring usage to the hour, to the.

[B]

It said happy Mother's Day the other day on the thermostat. Like, dude, that's super cool. My dad's got one at his house. It just looks so good. It's like so much. It's got the little glow. You could change the colors on it. Like anybody that doesn't at least try one out. I just think it's foolish, like, for.

[A]

What it does and it's.

[B]

And the ROI is going to prove itself out to be like, like 300% of what they were making.

[A]

And we just hired our first messaging engineer. We just hired our first AI engineer. Like, we are developing this product faster than what most products are going to get developed to. People are already buying Echo Bees, Honeywell's and Google's for 200, $250. Ours is priced around the same, same price, but it has so many features like the messaging, like starting the unit for the first time. We were. We're able to start units from all over your.

[B]

Your.

[A]

The cities and states, from your office. We were never able to do that. We're able to monitor. We're able to see if anything's wrong with the unit before it happens. So imagine you're calling your customer, tell them, hey, we're on our way to fix your unit. And they're like, well, what do you mean? Oh, we've noticed that.

[B]

We.

[A]

We've been monitoring it and we know that something's going. We need to replace something in it. So we're going to go out there and we're going to make sure that your units running efficient or the air.

[B]

The air. Air quality filters or whatever. You know the age. Like, dude, you built something for the contractor, which is so much better. And I just feel like when people really realize what you have, there's not a company around, you know, Because I'll tell you this, you. You're rough around the edges. You tell people like it is. Some people don't like that.

[A]

Yep.

[B]

But they don't understand the product and they don't understand the value of the long term. There's a lot of people that either go all in with you or they're like, oh, Ishmael. And the same thing with me. I mean, yesterday somebody made a post about me. They're like, I'm so sick of seeing this guy. There was 80 people that said, like, good things about me. So he took it down. But I'm like, look, I always try to stay in between because, look, I don't want anybody to try to take down my company because too many employees will get hurt. So I try to really guard myself of what I'm going to say. You're a lot more outgoing. You're like, come on, bring it.

[A]

Yep.

[B]

You're like, I'll take on any fight. You'll go against everybody. I'm just a little more sensitive just because I want to be very sensitive to the people that I work with, dude.

[A]

I'm more. I'm more. Anything that we can do to protect our contractors. You already know how I feel about them, right?

[B]

Yeah, you're. You're really doing a good job of that, dude. And what we're going to do, me and you, we're going to do like, you've already got like a best practices group that you like. If you're part of nuve, they get coached every single week by the top players in the industry. That's priceless. It is priceless.

[A]

Yep.

[B]

So if somebody wants to get a hold of you, Ishmael, how do they do it?

[A]

Look, go on Nuvehome.com if you want to learn about our product. Our products. You know, over 400 contractors have already joined us in the short seven month journey. We got over 10,000 units already active. 15, 000 units deployed in our first seven months. We're the fastest growing company out there right now. If you guys go on nouve at home, you guys could learn about the. The product. If you guys want to know about the mentoring. Nuvehome.com My social media, Ishmael Valdez, CEO on Facebook and, and Instagram. More than happy to help you guys with anything, man.

[B]

Yeah, look, I mean Ishmael, I think he'll get you a unit if you want one. If you're serious, all my H VAC.

[A]

Contractors, I will ship you a unit brand, send it out to you the same day and you. It'll have your logo, have full functionality on it. So you could try it. Call us back when you want to place your first order.

[B]

Yeah, dude, I just think he. He's helped so many people. Last thing is we talk about a lot of stuff. I'll let you close this out.

[A]

Look, man, I'm super how the one thing that I'm still grateful for is having friends like you, Tommy. Having friends like Travis and all the. All these guys that, that we're still the best. The best, dude.

[B]

Such good people, man. They're such. They're the biggest hearts in the world, dude.

[A]

The best part about the group that we have, Tommy, is that nobody's looking for anything from you. Nobody's looking for anything from me or from each other. We're all just looking to help each other win. And that's the best part about the group. So I'll.

[B]

I'll.

[A]

I'll. I'll leave it off with you guys. Should be. You guys should be looking for that same group that, that motivates you to get up.

[B]

That.

[A]

That holds you accountable for all your goals and that that actually makes you a better person both physically, mentally, and spiritually. So thank you for having me miss.

[B]

Thanks, man. I appreciate you flying out, dude. You're a busy guy.

[A]

Let's go, baby.

[B]

Hey there. Thanks for tuning into the podcast today. Before I let you go, I want to let everybody know that Elevate is out and ready to buy. I can share with you how I attracted a winning team of over 700 employees in over 20 states. The insights in this book are powerful and can be applied to any business or organization. It's a real game changer for anyone looking to build and develop a high performing team over here at A1 garage door service. So if you want to learn the secrets that help me transfer my team from stealing the toilet paper to a group of 700 plus employees rowing in the same direction, head over to elevateandwin.com podcast and grab a copy of the book. Thanks again for listening and we'll catch up with you next time on the podcast.