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The Home Service Expert Podcast
The Sales System That Took Him to $300M+ Revenue (David Peterson)
00:44:14
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- [00:00]
David Peterson
I'm not afraid of price. The way I tell my team is if you're afraid of money, you're never going to make any. So if you're afraid of being a profitable company, as a leader, you're going to go to the bottom too.
- [00:11]
Tommy Mello
Welcome to the Home Service Expert. Built for blue collar entrepreneurs who are ready for more.
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David Peterson
When your customer says yes, stop talking.
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Tommy Mello
Find that the pursuit of a goal, at least for me, is a source of my happiness.
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David Peterson
You're never gonna be successful doing what everyone else does.
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Tommy Mello
New episodes every Monday.
- [00:32]
Before we get started, I wanted to share two important things with you. First, I want you to implement what you learned today.
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To do that, you'll have to take
- [00:39]
a lot of notes. But I also want you to fully concentrate on the interview. 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 and 22 states. Just go to elevate and win.com podcast to get your copy. Now let's go back into the interview. All right, guys, this is it. Welcome back to the Home Service Expert. I got David Peterson in the house. It's based out of Charlotte, N.C. sVP of sales at Renewty. He's an expert in sales KPIs multi brand platforms, Senior vice president of sales at Renew and I love sales. Leading sales strategy for a multi brand platform with nearly a thousand thousand representatives. With over 15 years in the home service industry, he advanced from a sales representative at Mad City Windows to senior leadership driving growth and scaling systems. David specializes in inhome selling, KPI driven management and building repeatable sales systems that deliver consistent results. He played a key role in expanding Mad City's focus from Windows to include Bass, helping the company grow to over 300 million in annual revenue before its acquisition by Renuity. He went to Madison, where my niece goes, which is awesome there in Milwaukee or Wisconsin, I should say. David is passionate about sales strategy, culture, building and performance excellence. Outside of work, he's also a real estate investor. We're just gonna dive right in, man. Let's just get the audience caught up who you are, what you're passionate about, what you're looking forward to in the future.
- [02:09]
David Peterson
Yeah, so the way I look at it, I'm a three time college dropout who, you know, basically, basically kind of drank and partied his way through his 20s and then had an opportunity. And it's one of those things where you get one opportunity and, and sometimes that's all you get. And if you don't take advantage of it, who knows, you know, what the future holds. So I actually, I was kind of in a dead end. I was selling cars, right? Selling last place I was at selling Mercedes in Madison, Wisconsin, making decent money at the time. You know, just what, what plenty of people that age would have considered good money. But I was not really driven. I didn't really care about the industry. I wasn't, and I love cars. I just wasn't passionate about what I was doing. Didn't have any focus really and didn't have any real ambition still. And 2008 happened, the economy crashed and I had shingled roofs for a guy named Corey Sturman who had started with his brother a company called Mad City Roofing. So car industry failed and I looked for another opportunity. So I reached out to Corey and said, hey, you know, I can sell. You got any openings? And so it did not go smoothly to begin with. So I showed up, no systems. They sent me and these are great guys, hardworking guys, built, built an incredible company but to a place where they didn't know how to scale and didn't really have the, the vision. We were still doing insurance quotes and you know, we're still chasing storms to an extent and that will catch up with you. So I came on board and just started, you know, shadowing some of the other roofing estimators, climbing up on roofs, leaving a quote saying, you know, give us a call when you're ready, we'll try to be as competitive as possible. And you get a lower quote, let me know, I'll see what I can do. You know, same old BS that, that so many people in this industry I guess still do. The best thing that ever happened to me in my professional career is that shortly after I arrived, somebody else who was affected by the, by the auto industry failing and the economy failing was Nathan Richmond. He's the guy that came in and effectively resurrected Mad City to, to what we built it to today. And he came in with a Rick Grasso 10 step sales process system and basically told everybody, this is what we're going to do now. And he realized quickly that there was no way to really build value with shingle roofs. No, no good sustainable way to set yourself apart, differentiate yourself. And so he ended up kind of scrapping the roofing program, scrapping the insurance program and went to a retail window model and first call close. Everybody said, well that's never going to work. Madison, Wisconsin, you Know, you know, the city, it's a, it's more of a town, it's very tight knit, it's very educated. Nobody's going to fall for this here. You know, that was, that was what everybody was saying is nobody's going to fall for first call close in this area. 15 years later. The year I started, we did 4.8 million at the end of the year. That was 2009. And last year we finished at 348 million. So I guess, you know, it worked. And I just got really fortunate a number of times along the way and was just smart enough to recognize some of the opportunities as they presented themselves as we started to grow. It also wasn't smooth sailing to begin with because I was a hotshot salesperson, thought I knew everything and didn't like being scripted, didn't like a system and actually got myself fired. I dropped a deal on his desk and said I sold the morning appointment. But the second one was another effing no show. And two days later he just didn't even say anything to me. He let me walk out and I'd sold a deal, right. I brought him a deal next, but I complained about the second lead. Two days later he pulled me out of a sales meeting and fired me on the spot. And I was just good in the way that, the way that I say this, I was just good enough at selling to convince him to give me one more shot. And that was basically the day that changed my life. I realized that if I wasn't on a system that this guy wasn't going to keep me and I don't have any of the prospects. I'm three time college dropout and you know, I've already burned out another career and I better give this a shot and best decision I ever made. Best. Having him fire me for a terrible attitude was also. I think it worked out really well for both of us because it was the spark I needed to, to really turn things around.
- [07:09]
Tommy Mello
What do you tell somebody with a big E? I think being great at sales comes with some somewhat of an ego. Like you're going to be the prima donnas and they're tough to manage, but they deserve. Tom Brady was kind of an asshole like to deflate the, the football like. But he showed up and was a good captain. I mean he did, he did good things on the field, but he was a primadonna. What, what do you say to the guys out there, gals that run a company that have guys like you? I mean, there comes a point where it's toxic and you might have to make that move. But every guy that I part ways with that left on good terms has come back and just dominated.
- [07:48]
David Peterson
I mean, that's, that's a, that is the most perfect way to look at it as far as I'm concerned. Because if you're, if they're coming back, they realize that they lost an opportunity and credit to them. Even if they did need to go, they, they realized, okay, this was actually by shot, or at least this is, this is something that I shouldn't squander. So any leaders that have I. So I used to believe for a, for a long time I like to think that my career as a, as a leader has evolved. And for a long time I didn't believe in culture. In fact, when I did interviews, I'd have a, you know, a kid out of college say, so what's, what's your culture? And I was like, first of all, you're reading off a list of scripted questions. Our culture is we make money. We don't have beanbag chairs or pinball machines or anything like that. We just, we make money. And that was actually wrong. Like, not embrace it. We had a culture, but we didn't really cultivate it. It was starting to edge in the wrong direction, in fact. And having started to surround myself with some other leaders in the industry and hearing what the way that they talked about their teams, it was really inspiring because I needed to grow as a leader and understand empathy, right, and, and respect with them and not just yell at them every time they did something wrong. But if you do that, then you can hold them accountable for their attitude. But if you're just a jerk the entire time, which I was plenty of times, then it's. Then you're going to breed that prima donna, right? You're going to create that prima donna and let them ruin the culture of everybody else. And if you kind of do a reset, which I've needed to do a few times in my career as a sales leader, you do a reset and say if I'm treating them properly and giving them the resources that they need, then I can ask them to do whatever I want. Right? But not until then.
- [09:39]
Tommy Mello
Yeah, I like the. I've got an eight step sales process that took me probably four years in the field to figure out. And I say it's the process that works every time. It's flawless, done right. You're going to win every job. This ten step process with Rick Grasso, I don't know who he is. Tell me a Little bit about that.
- [10:01]
David Peterson
So, so our, our businesses are, are adjacent, right? So you look at windows, windows specifically and roofing were, were Rick's big thing. So he, he was a legend in our industry and he, he was a mentor to, to Nathan who started, who basically came in and resurrected Mad City. He was a mentor to him. Some of this stuff needed to evolve, right? Some of the way that he talked in the home and everything needed to evolve. But generally it was just a really solid 10 step sales process. And the way I look at this is nobody, nobody created a sales system. Nobody recently created a sales system. We're all just stealing everybody else's ideas. And then at least if you're doing it right, you make them your own.
- [10:43]
Tommy Mello
What's interesting about the home service industry, especially demand driven part of my sales strategy, the most important thing that I make my guys chant is start the work. They called you out for. They want a keypad. Start the work, earn their business, get them to spend money because you get the repair at the right number. And then you say listen, I can continue fixing this. That doesn't work in a lot of other industries. That won't work in windows, that won't work in bathroom remodels, that won't work in most of home improvement. You know, the hard part for me is our conversion rate this morning. I get Every, all yesterday's KPIs 77% including new door quotes service is over 90% obviously door quotes. I've always said if you're over 60%, raise your prices. But what do you guys consider a really good close rate?
- [11:36]
David Peterson
Long time ago I heard this saying gross is gross, right? If you're talking about what your actual gross close is and what, what, how did you actually get paid. Right? But we still use gross close as a, as, as one important metric. So gross close for us industry wide, 30% I think is acknowledged as pretty darn good. We as a company are right around 40% in gross close. And that's renewed as a, as a whole. So renewed is, is seven started with eight companies kind of distilled down. Now we're, we're combining and rebranding everybody now. But you did just under a billion in, in net sales last year. And we've got a lot of different nuances within those companies, but we average right around 40% close rate. Which in, in this industry is, is way up in the, at the, in the top tier.
- [12:33]
Tommy Mello
You know, renovo. Their biggest mistake was taking too much leverage. And that tends to be the one thing that I don't love about home improvement. I respect home improvement more than any other industry because you could go hunt and you got to have a keen eye. And we generate 34,000 inbound calls a month. We're in 25,000 homes a month. My average ticket is $1,200. So if I just started selling mini splits or flooring or windows, all of a sudden, like, that's what's so exciting about the future with us. But everyone's like, man, if I got into the garage artistry, I'm like, go ahead and try. I've never met anybody that's, like, made a pivot and said, man, this is a great industry. I love the industry. But it's just interesting watching and learning because thank God I got close to Sean McGraw this last decade, and Shaw's introduced me to so many great people. And I just. I'm just fascinated. I met a guy named Matt Esler and Anderson Renewal, and the dude is like, blew my mind. And he's like, but. But because it's under those constraints, they can't sell to normal pe, so the multiples degregated. And I looked at that, and he's like, dude, I've got the playbook to take this thing to 20 billion. And I'm just. I'm just fascinated by. Because that's the one company that keeps showing up at every event. That's the company that I see a sticky note on my door. That's the one company that I'm like, they're just getting like, they're attacking everything. And I'm like, it's just really, really interesting. So the private equity company I'm involved in was the Window Nation roll up, and they did all Greenfield. No buy and build. It was all Greenfield. And I'm like, well, how long did it take for you guys to break break even on a Greenfield? They're like, six months. I'm like, man, six months. That's amazing. But they're like, yeah, our average ticket was 12 grand. You know, how. How important. So sales is everything. You guys obviously probably got how much of your revenue is financed.
- [14:35]
David Peterson
It's funny because again, you bring in a. You bring in a bunch of different companies, and they do have different ways of doing things. And some of our. Some of our operating companies had a different demographic and didn't need to leverage it as much. In my opinion, every single company needs some sort of financing, no matter what, no matter who your demographic is.
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Tommy Mello
Oh, our.
- [14:55]
David Peterson
We have cash buyers, then you don't have enough buyers, right? So that then you're missing. If you're going for the cash buyers, you're missing the majority of the population. And so that's. To me, financing is every single thing in this industry. And if you don't leverage it, you're missing out. How, how easy is it to explain to a homeowner that you have an unsecured home improvement loan to do something to your home that's only going to add value? That's not a hard sell, or at least it shouldn't be. So, yeah, the financing has been massive for us.
- [15:32]
Tommy Mello
Just thinking through a few things here. What do you. This is a tough question because I think you could be. There's two answers to this. Do you think your company should have the same price book throughout the country?
- [15:49]
David Peterson
This is a really good question and a really, really hard question. The answer is I don't know. And I want to be as, as I've. I've had to really understand. I've had to kind of do a reset. And I'm so quick to say, well, no, this is the answer. And the reality is right now I'm realizing that as I get more involved in, in our other company. So I came from. Right. Met from Mad City. That's the company that I was part of, growing to what it was. But now I'm with the, the parent company. Now I'm at headquarters. And now my purview is everyone. And so the more I get out. So my philosophy has always been the price is the price doesn't matter where you are. So I believe the price is the price and the process is the process. With a, with some caveats because you do have to, I think, account for your competition. Now, again, that's even a hot topic for, for us because I don't want you to be price selling. I don't want you to be trying to compete against somebody else in dollars because you're going to lose that if you're a profitable company. You're competing it for. For price that you're just. It's a race to the bottom, right? So I don't want to get into that cycle, but we still have to be cognizant of regional economies, right? We're having a really hard time breaking into Houston right now. And it's like, how is Houston any different than we've been there? This, this company has been there for a long time. But how is this different than Austin? How is this different than Dallas? Well, it's more competitive. You've got eight times the, you know, competitors Doing very similar products. So do you have to consider that out? It's still, to me, it's still one of those unknowns because I'm not afraid of price. The way I tell my team is if you're afraid of money, you're never going to make any. So if you're afraid of being a profitable company as a leader, you're going to go to the bottom too.
- [18:00]
Tommy Mello
We have the same price book in every market and I can send any of my top 20 guys to any market and get the same prices. I will say there is a competitive analysis than there is. I will say Denver seems to be a market that we need to pay more in. It's just because it's, it's hard to get people. I mean, I'm in 37 markets. Same price book across the board. But here's the difference. What I will say, certain markets are going to have different discounting, especially if you got, you know, we do military, we do school teachers, we do depending on the area. And I like to fluctuate as far as integrations go. When you start fooling with the price book per market, it makes it really hard with a company that's under one platform. Because the strength of an integrated company. And here's what most people miss. I could send any guy to any market, throw a different shirt on him. We've got a few different brands, mostly A1 and go in a different van, different shirt, same price book, same iPad, same everything, same parts. And that's the strength of a truly. That's economies of scale. So you start changing everything. And now it gets really hard to run the same playbook. And that's one thing I think that, that most companies that are trying to do what we're doing in the garage door space, they miss that piece and then they start going, well, we're going to do new construction and fireplaces and front doors. But they didn't really get the solid garage door foundation. Like at some point you got to go into multi trades. Here's the deal. Commercial's way different, new construction's way different. And the truck setups are different. The way the way you pay is different. The way you collect money is different. And when you start doing all these things, I ask these companies all the time across the country, well, what department are you making the most money in? They're like, they don't really know. Like that's one thing I'll tell you that changed my life is a really good cfo, a good FP and a team. The people that could go in and dissect. And I know exactly down to the decimal point. I mean, I got, I get my numbers by the 5th of each month and I've got to look on the first. And I think that, you know, most of us started as a salesman or in, in the trades. And then you got to pivot to this leadership and that's probably the toughest move that most people never get. Michael Gerber talks about it or the technicians. And I can tell you all the guys that the technicians see the cost of the price of what we pay and that's it. They don't see the infrastructure that goes into all the software, all the overhead, the truck costs, a little lawsuit you got to deal with to pay this client off, whatever it might be. And I think that's a hard road to get over. You've been doing this now a long time. What do you see from a technician standpoint? How do you pers. How do you let them know, like, you show them like, we don't make as much money as you guys think.
- [20:53]
David Peterson
So my philosophy is, so we pay well, right? So, so that's one thing that, that we've always done, is we pay well. I, I would say we're in probably the top 15% of paying salespeople across the country from what I've heard. And you know, we've got a lot of similar acquaintances. And so you talk to enough people and I think we pay quite well. And so the biggest thing that I tell by all of my sales team is I try to be as transparent as possible. Transparency to me is absolutely the key. So I can explain to a degree to them about overhead and about all the things, and I'm certainly not going to get into EBITDA conversations with them, but making it as clear as possible that the only way that you're going to make good money is if the company's making good money. So do you want to continue to have this income that is for most people, life changing? Do you want to be able to make this, Guess what? Any good company is going to take care of the company first, otherwise they'd be out of business. So if you think that you are getting paid well, that's because we're getting paid well. So let's understand that relationship. We, we need to make money before you can make money. And so if, if our pricing goes up, it has to go up, and that's just life. So don't run away from the price. Understand it, embrace it, and in some cases brag about it.
- [22:21]
Tommy Mello
You just gotta raise.
- [22:22]
David Peterson
This is. Yeah, you got the, you gotta raise. And, and to the homeowners, we are not going to be the cheapest. The reason we're not gonna be the cheapest, probably closer to the, the more expensive, is because we're gonna be around 20 years later and make sure that they understand that that's why we have the margins that we have is because the company, this isn't a fly by night and this isn't something we're trying to grow up and sell in a, you know, sell in a year. This is, this is a long term thing. We'll sell, but I want to keep doing it.
- [22:53]
Tommy Mello
One of the things that I really focused on was we get our springs from a manufacturer that just does springs, the best springs you can. We get our cables from somewhere else, our drums from somewhere else. The marketing in which we do is a byproduct of our conversion rate and sales average ticket. What do you think some of the best marketing sources that you found over the last couple years are?
- [23:19]
David Peterson
It's really tricky because it's pivoting a lot. Right. So the affiliate marketing sources that worked so well during COVID getting more and more competitive and they're, they're talking about the lead eggs. Yeah, there's, they're, they're everywhere. You know what we have actually done which is contrary to what, what a lot of especially pe. PE back companies are trying to do it. What we've done is contrary to what a lot of the PE back companies are doing. Not we, we'll never be able to get away from them. But in terms of like the, the lead aggregators, you're always going to have to do them. What we've done differently than I think a lot of the pe back companies are doing is we noticed that volume started to drop and then we went back to what has always worked in this industry. Door knocking. Door knocking has always worked. And from a. As you grow in scale, it's really expensive to have face to face teams. Right? It's. And a lot of, a lot of big companies are looking to go away from that for good reason because you've got so much risk, there's so much manpower. You gotta be flexible enough to be able to pivot when something is not working. So we actually rebuilt our face to face teams at a couple of the divisions and we went from in 2024, 30% face to face. 30% of our lead generation was face to face and in 2025 it was 42%. So. And that's Not a long term answer, but at the same time, I think you have to be willing to pivot and, and keep things moving until you find the next right answer. So we're actually going to be going to do some like real top of funnel things. Renewed is, is going to be all renewed. So the company is. You said you've got some, you have multiple companies, different brands, Right. Well, that's how we've been for five years. But in the next year we will all be renewed.
- [25:18]
Tommy Mello
I'm coming to the point now of realization that what's the fastest way to grow is to get with the right partnerships, with the right OEMs. And I don't think enough people make that call. I think we get what we tell ourselves is we're loyal. But loyalty means you're looking out for the entire company. You're not saving people.
- [25:40]
David Peterson
That really strikes a nerve with me because loyalty to me is. Loyalty in business is to me a fallacy. Loyalty is, is. We are in a mutually beneficial relationship and that's why we're together. Right. And this, this, this idea that because you've been here this long.
- [26:04]
Tommy Mello
Yeah. Tenure doesn't mean loyalty.
- [26:06]
David Peterson
Absolutely nothing. Loyalty is. You are, you have common. We have common interests and we're both working together to get there. And just because you've been here this long, if your performance starts to drop, there's somebody that's hungry that really wants this. And I'm not going to pass that person up because you've been here for a while. Not a chance.
- [26:25]
Tommy Mello
I got to hurt every day. I got to come in. I can't be an absentee founder. I go in, I do every orientation, I'm at the graduations, I'm on every single meeting. What I'm trying to do is be the dumbest guy in the meetings.
- [26:38]
David Peterson
Well, if you get the right people in there, then that's. You're going to learn just as much.
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Tommy Mello
Man, when Covid hit, that was like nutty what it did for our industries. I mean, it's like a once in a multiple lifetimes thing because the multiples went up and we were the hot chick at the party.
- [26:55]
David Peterson
Absolutely.
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Tommy Mello
I mean, how did that feel for you?
- [26:59]
David Peterson
I couldn't even quantify what Covid did for my career. Um, but I think it's. It was a double edged sword. So. So Covid,
- [27:09]
Tommy Mello
we.
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David Peterson
Everybody was captive in their homes. They're staring at the same four walls and our industry is the savior for that. Because if you're going to be spending more time at home, we can make that space nicer for you or more accessible for you or, or, or whatever you need it to be. Somebody in our industry can help you with that. So I think it was a blessing and a curse, I think, for our industry. Again, to your point at the time, I'm a hero, right? Because I had just taken over. So my predecessor, when the first transaction happened, my predecessor, I think, got some cold feet about what was going to happen with a new company, right? I saw that opportunity and I jumped at it and I was scared. And it could have gone horribly wrong because we couldn't even get at homes for all we had. The, the phones keep ringing. And I think that's when the affiliate marketers really found their stride, right around that time. So it was this perfect storm of all of the right circumstances. And so Covid to me was that supercharged my entire career and made me look like an absolute hero. And then reality sets in, right? And so I think most of us at our company and our sister companies, we're just in the right place where we weren't taking that for granted. And we were trying to, you know, 30% year over year growth, but we're still trying to work the infrastructure and make sure that that doesn't get left behind. And I think that was. We found a good formula. But a lot of my sales team, I've lost a fair amount of my sales team that were rock stars during that time. Why? Because they weren't actually as good as they thought they were.
- [28:55]
Tommy Mello
You know, I have a mentor of mine. His name's Cameron Herald. And he's been in here and, and I said, what if you love to work? Man, I don't feel like I ever come to work. He's like, that's. He's like, what did you like to do when you were a kid? Did you golf? I'm like, yeah, I golfed every day. He's like, look. He goes, I have no respect for people that just say, I love to work. Because there was something you love to do and there's. For guys like me and you, enough's never enough. You look at Tom Brady's, a great example. Three super bowl rings is not enough. Seven wasn't enough. Twenty is not enough. You look at some of the best people in the world and the best thing I do is compare it to sports. I mean, dude, that's. That's it. And now I just realized I'm a coach and I can't play the game anymore. I can't say, hey, put me in, coach. I can't do that. So what can I do? I got to get the best offensive coordinator, the best special teams coordinator. I put people in the game. I call the shots. And there will be a day that I'm hoping a better coach comes on, and that's when I'm going to be the special teams coordinator. I'm going to do the orientations and I'm going to do these things because there's someone out there that's better. What got you here can't get you here some of the time. But I think the fact that I got 20 years in this industry, I started it, I'm a key stakeholder in the culture, and that's where I want to live. And I love marketing and I love sales. Everything else, I don't like dealing with lawyers. Don't like. I don't like these meetings. Sit in a boardroom and we talk about all the shit. I'm like, I know all these things, but they're great questions. And we, we talk through them, and I will say that they're very, very conducive to success. But I just want to do what I love to do. And my problem is, is I gotta have purpose. You know what I mean? I can't imagine just being like, I'm gonna golf every day and just go fishing. Because I know the guys that have done that for three weeks when they got their lump sum of money and they go, I give it all back to be back where I was, to walk in and be in my teams.
- [30:53]
David Peterson
That. So going back to this, there is. I believe you can love working if it gives you a purpose. Right. And so, so mine. I didn't even realize this right away because I. I would just lean into the fact that I'm greedy. I want money. I come from abject poverty. We moved around all the time. Single mother evicted from Section 8 housing. Like, that's how, like food stamps, food pantries. I mean, that. That's how that's next level.
- [31:24]
Tommy Mello
Yeah.
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David Peterson
And. And there's plenty of other people that it had way worse.
- [31:27]
Tommy Mello
Yeah.
- [31:28]
David Peterson
But that's not an easy start. But I think what that did was make me like, my passion is. Is never going back there. And so if that means I'm working, then I think it does mean I love to work. But then I realized what it was really the most powerful thing, which kind of shouldn't be a surprise, but it hit me was when I got a note from one of my guys, and he reminded me of how we. How we kind of how he had gotten started. He was a property manager at an apartment complex and had a new baby. Premature baby, medical bills adding up. Joined us out of pure desperation and was selling really well. He's joined us in December. Was selling really well, but not making any commissions yet. Right? We don't pay until the job is complete. And called me and he's like, I don't know how to do this, but I, I'm going to get evicted. I need to, I need to pay my rent. And I've been there, right? I. I've been there. And he's selling now. I'm not, I'm not a charity organization. This guy's selling. He just wasn't getting paid yet. So I venmoed him a thousand bucks to pay his rent next month, same call. And I looked at the numbers again and I'm like. And I knew his numbers. Cause I follow him. But I double checked the numbers and sure enough, the guy is closing at 55%. He's working his ass off and he can, he's. He's worried about losing his apartment with his, with his wife and his new baby. And he's still out there doing what we asked him to do. And long story short, three years later, he bought a $1.2 million property and I had promoted him to manager. And so when I think about what really, what do I love about this? It's the empowerment of the people around you. And then I think you can love it, right? And I don't think it's bullshit if you're actually honest and that's why you're doing it.
- [33:29]
Tommy Mello
I agree. And I've had those calls.
- [33:31]
David Peterson
And
- [33:33]
Tommy Mello
we as a company will not make loans. I've done some things because I've been there. You know, I had a guy that just exited for 2.5 billion on the podcast recently, and I think this is the most profound thing I've heard in a long time. He said on a plane ride, it was about a three hour flight. I wrote down everything that I just, that just I wouldn't trade for the world. And he goes, I wrote down 167 things. He goes, it was quick. It was like my brain just started writing stuff like. And he goes, tommy, I counted what things cost $0 and 140 of them cost nothing. And you know, I'm a Wolf of Wall street guy. I'm like, I've been rich and I've been poor. I choose rich every day. I mean, that, that buys freedom. They're fun tickets. But that really was profound. To me is to think, you know, there's a lot of things like just calling mom or just going on a walk with my fiance or just playing with my dogs and soon to be kids, hopefully. And just the, the being on a boat that you could lease a boat. I mean we're building a really cool wooden boat. But like I think that's really important is to stay grounded and just realize the one thing about me is I've not changed. You knew me 15 years ago, I'm the same guy. Learned a lot of stuff, failed over again. But I think it's good to stay grounded, stay curious, and never think I've arrived. I want to ask you two more questions and we'll close out number one. I think the hardest thing for me is going to be going into multi trades because it's just different. And what are your best tips to get into a next trade?
- [35:10]
David Peterson
I mean you have to put a lot of time into it and, and once again you have to be willing to fail. We've tried a number of, of products somewhat adjacent to what we do. Um, a couple of them. One of them we had. It was our, our by far our gr. Highest gross profit margin that we had ever achieved and it was going really well. But then the, the manufacturer just could never keep up and they ended up being a horrible partner. And if they could have ever delivered on their promises, we would have crushed it. So in that aspect we failed because, because of that situation. Then we've tried a couple of other products along the way. I think the big thing is you, you have to go in intentionally. You have to really. We've jumped the gun in the past and this is a little bit earlier than when private equity came on. They gave us a little bit more discipline. So I think discipline is the key and do the research of had it ahead of time. And just because you can sell Windows in this market, can you sell Bath in this market? And so who are your competitors? And I'm a firm believer, like you said, I can sell at any price in any market. But will it make sense for me to go into this market with this product? Because these are two very different things. Right. And, and if there's a really, really good operator in that market, is it worth me going in and then looking around at all the competitors? Is, is if somebody else is doing this very similar to what I'm doing and is already crushing it, That's a good sign. It's a good sign. But also I better be at the top of my game if I'M going to go in with that product and I better really think it through. And so we, we've, we've done both. We've successfully grown. We, we started adding cabinet manufacturing and, or excuse me, not manufacturing, we've done both. We started adding cabinet refacing back in 2018 before we were rolled up and we failed it. It didn't go well, but we, but the reason we failed is because we didn't put any effort into it. We didn't, we didn't take the time to realize it was a slightly different product. We had to change a little bit about our installation capacity. We had to realize this is a four day turnaround and not a one day turnaround. And so we went back into it the next time intentionally. And now it's, it's scaling at an unbelievable pace. And some of the markets that we've had struggles with in other products, we've got way better access to leads, there's less competition. So it's just going in, doing the research and understanding, you know, what you're getting into. Because again, I'm of two minds on this. The process will, will work everywhere with anything. But don't just be, don't be so naive that you don't have to put the work in to make the process work and you don't have to pick the right thing to make the process work. So that, that to me is the big one is, is going intentionally and understand that you might actually, you might actually waste a couple million bucks. But overall is just, yeah, think it through and understand everything you're up against.
- [38:19]
Tommy Mello
Is there any books that changed your life that you'd recommend?
- [38:23]
David Peterson
The last one I really like was leaders eat last.
- [38:26]
Tommy Mello
That's a good one.
- [38:28]
David Peterson
So this guy was a Marine Corps officer and it was, and the mantra in the Marine Corps is always, you know, leaders, leaders always eat last.
- [38:39]
Tommy Mello
Yep.
- [38:40]
David Peterson
And that to me was in general, it's like, take care of your team first.
- [38:47]
Tommy Mello
Yeah.
- [38:48]
David Peterson
If you take care of your team, they're going to take care of you. So to me, that one's the one that's, that's resonated with me. I think more than anything is, is. And that was not always my philosophy. I was like, here's the rules. This is what you do. You know, do it, you'll be rich. If not, you're out of here. And when I started paying more attention to what my team needed and making sure they had their resources, then that actually was going to pay off for me quicker than anything else.
- [39:14]
Tommy Mello
How do people get A hold of you, Dave. If they want to reach out, it
- [39:18]
David Peterson
depends where they're at in the team. So for the longest time, and this is what we talked about before, for the longest time, every single member of my team had my direct cell phone number.
- [39:28]
Tommy Mello
What if. What if the audience wants to get a hold of you?
- [39:31]
David Peterson
I'm on LinkedIn. David Peterson, easy to. Well, there's a lot of David Petersons, but David Peterson with renewed. And that's LinkedIn's the best way because, I mean, I can't imagine how many communications you get on a daily basis, how many solicitations you get on a daily basis. But.
- [39:47]
Tommy Mello
And I feel bad, dude. It's the hardest thing for me because I take the call a lot.
- [39:50]
David Peterson
There's just some great people, but it's just. It wears on you.
- [39:54]
Tommy Mello
But.
- [39:54]
David Peterson
But that said to me, the best way to get a hold of me is, is just shoot a message that's genuine on LinkedIn, I've had to, as I'm sure you know this more than anybody, I've had to really filter out, like how, you know, how much I'm out there and available because there's just not enough bandwidth. But just reach out on LinkedIn, I read every message. I just. If it starts off as a solicitation, it's gone.
- [40:19]
Tommy Mello
The hard ones are I'm just starting out. I'm like, did you read my books? Have you listened to my podcasts? Have you? Have you failed enough? Because I don't have the magic thing. And here's what I found. If I give you free advice, you're going to do nothing with it. So no one that I've ever given free advice has ever moved the needle at all. And I'm like, here. Here's the best free advice for the listeners out there. Success leaves clues. Go out there. Do the work. Go out there. I used to fly to $100 million shops on my dime, pay for their lunch and dinner. I'd read the guy's books and I'd go in curious and humble, and I'd get around the success and I'd rip off and duplicate R and D. Final thing I always ask is, you could close us out. We talked about a lot of cool stuff, man. I didn't ask one question that was on my podcast, and that's. I know was a great one because we just had a conversation and I really appreciate it. So anything that we. Maybe it's a sales tip, just something vinyl for the audience to just one final thought.
- [41:19]
David Peterson
Be humble enough to Know what? You don't know? I, I got to a place in, in my career where I thought I was right on top, you know, and, and the top is different for everybody. But in my company, I was right at the top and I was pretty proud of myself. And, and I think there was reason to be. I came from nothing. And it's been a wild success. It's been an amazing ride. And then I moved to this new environment among all of these really, really smart people. And it was probably the next best thing that happened to me in my career after getting fired 16 years ago was getting around people that are way smarter than me and so, and understanding that, you know what? I don't, I don't know anything that I actually thought I knew because there's more than one way to skin a cat. And a lot of these folks are really good in adjacent industries, in some of them, in our industry. And being willing to step back and be humble and learn again, it was the reset that I needed. I actually, I got too into my own success to realize that there's always somebody better than you. And, and so, and I think you said this earlier, I don't want to be the smartest person in the room. I want to be the exact opposite. I want to surround myself with people. And that's in life and business. It's, it's amazing. And that, and I did realize that it was, I had kind of plateaued and wasn't reaching for anything more because I thought I knew it. And we don't know shit that we just, we don't. And as soon as you think you know what you're doing, I think you're going to start to, you're going to start to go the different, the wrong direction. As soon as you think that you know all the answers is when your decline begins.
- [43:24]
Tommy Mello
I love it. David. Well, this was a blast. You want to get all of David Peterson? Check him out on LinkedIn. Thank you for doing this, brother.
- [43:31]
David Peterson
Thank you. You're going to be having me here in a bit. I will be.
- [43:34]
Tommy Mello
All right. I appreciate it. Hey there.
- [43:36]
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. Like 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 elevate and win.com podcast and grab a copy of the book. Thanks again for listening and we'll catch
- [44:12]
up with you next time on the podcast.