← To The Point - Home Services VIP Room Podcast
To The Point - Home Services VIP Room Podcast
From $6/Hour to Building a $30M Home Services Business
00:56:10
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A
What's the password?
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B
Don't talk about it, be about it.
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C
Welcome in to the to the Point Home Services VIP room, where we invite you, the listeners in to hang alongside
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some of the biggest, baddest and most
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A
successful VIPs of the home Services industries.
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B
You never know which surprise guest will show up next.
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A
So let's get this party started.
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C
Hey, what's up, VIPs. It's your boy Chris, host of the Home Services VIP Room podcast. I got my co hosts on here, AG and Chad AP both looking fresh to death with their haircuts. Guys, I got a good haircut for the episode today. That look good? Yeah, not bad. Cut the gray out if you just. I realize I got to keep taking the zero all the way up a little bit higher as the grays get higher, but right now I just kind of look like, yeah, this is like a young 30 year old young man. Don't you agree, Aaron?
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A
Well, might be getting a little carried away, but you look good. Look good. I went in this morning. I get my haircut every Tuesday at 6. But this morning I had plans tonight to meet up. My son's in town, which you know, Chris, and so I'm g. Just hang out with him a little bit. Went and got a fresh cut for this one at 6:30 in the morning. 6:30 in the morning. Well, most of you contractors are at home sleeping haircut every week.
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C
He gets his damn haircut every week
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A
at 6pm every Tuesday.
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C
Imagine when you turn 50 next year. Like if you're gonna how much grazer have to cut out.
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A
That's the reason why I get a cut every week, Chris. You're getting there.
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C
Now I'm catching up to you.
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A
All right?
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C
And today's gonna be good. Hey, by the way, when this podcast rolls out, I think we're a couple weeks in the end of July. But the. The actual day that we're recording this was the release of our Yelp episode. And boy, have I gotten some interesting messages about the Yelp episode that we released already this morning, before I even woke up, I had some text messages about it and pretty interesting one. I'll be curious to see how this whole thing plays out. And. And it really can. We. We have. We got this. We got Jed as a conduit to listen to us, listen to everybody, to try and make change. So we'll see how it plays out from here. But I'm excited for today's episode. We got a friend on here too. VIP President of Service Professionals, Rich Bug. Hey, Rich. Did you Come out to a Rhino X a couple years ago, or did you make it to one of the Rhino X events?
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B
Yeah, yeah. Probably three years ago.
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C
Who is. Who was. Who was there that year as far as, like, Speaker. I can't remember. Saban.
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B
No, it was Fitzpatrick.
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C
Oh. Oh, Larry Fitzgerald.
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B
Fitzgerald. I mean. Yeah.
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C
Ever disrespect Larry and.
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B
And Tyson, who is amazing.
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C
Oh, yeah. And Mike Tyson. That was. Yeah, that was a great year. That was a fun.
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A
That was a great year. The Tyson one was awesome.
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B
Yeah, he was incredible.
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C
Yeah. Yeah. Scariest interview I've ever done. Ever done. All right, let's jump into this, too, real quick. Like I said, we got rich on here and H Vac plumbing. Let's go up in the Newark area. You'll go. Actually go over into New York, though, Do you, Rich?
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B
We do not. Thank God.
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C
Okay. And thanks. I didn't think so, but you kind of have a big spread there from north to south, you know, up in the north, North Jersey area. But before I get into anything, guys, I just want to go over a quick little idiom, you know, that I was thinking about this morning. Again, these things just kind of figure out, what am I going to talk about. And because I read a few responses to our Yelp episode, it made me think about this idiom. And actually, one gentleman in particular made me think about this idiom, and I will not mention that gentleman's name, but it came. My. What came to mind was fly off the handle. You guys ever heard that term before? The idiom, fly off the handle?
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A
Never.
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D
Aaron's never done that.
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A
He would never.
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C
Handle. Yeah, one thing makes me fly off the handle sometimes, you know, is what you know, in which, you know, in today's terms means suddenly lose your temper. But listen, the origination of that was back in the 18th century because, you know, all these old tools, the axes, the hammers and stuff, you know, they had to make this piece of lead, you know, fit on the wooden piece. You know, if you're sitting here swinging that thing, you know, and that thing flies off, all chaos breaks out.
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E
Right.
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C
Like, by the way, this has actually happened to me before in real life. I have flown off the handle a time or two. But, like, in the literal sense, I have my dad's old hammer. My dad passed away years ago. I took his tools, and I was using his hammer, and that damn thing flew off the handle. What a real piece of hammer that thing was. But it was sentimental to me, so I was, like, more bummed that I broke his hammer. So I had it fixed, by the way. You can, you can have it fixed. Just so you. Just so you know, I did not fix it because I'm not capable. Okay, so there we go. Fly out the handle. So nobody fly out the handle today. You know, riches in Jersey maybe has flown off the handle a few times. I feel like the stigma Jersey probably applies here.
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B
That's how we roll.
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C
Just want to do a quick intro on our guest co host today. Our guest co host today. First time I met was just a couple days ago. Great guy. I've been starting to learn more and more about his business and, and I wish I knew more about it a while ago. So want to to introduce our VIP guest co host today, Abdul, CEO of Basic Capital. Abdul, welcome to the show, buddy.
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E
Chris, thank you, man. Appreciate it. Thank you for having me. And it's awesome to be here and fired up to chat with the Rich and good to know you guys and have a good session.
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C
It's going to be a go time maybe. And you owe us a beer. Remember that. So we're not going to let you.
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E
Done.
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A
Done.
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E
If I can get away with it with just one beer, that's awesome.
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C
I have a feeling you guys are going to run a bar how we work and it probably won't be beers. Okay, so let me just jump in real quick thing. Give a quick shout out to our sponsors. I want to give a shout out. Our sponsors. Yelp a Boca a bokeh up there by, by you, Abdul. And then sales ask one of our newest sponsors on board and of course to you, Abdul, Basic capital for being a sponsor over the last I think like five, six months. So I'm happy, uh, happy to have you on here and share a little bit about the business and, and just from your perspective as a subject matter expert on this stuff. So kind of what I'm going to hit on today as far as general questions is when I leaned into Rich's business, which he's in the mid 20 million mark or somewhere around there, he'll, he'll give you a little bit more about it is, you know, how has he had good, consistent scale, especially over these last three years, there's been a kind of a changing of the guard I think at the business. Like the with Rich being able to leverage, you know, some new, younger leadership. He's got a ton of tenured employees, like a lot of really good tenured employees that have kind of been with him and we talked through like the pros and cons of some of those things which Which I think everybody here is going to be able to relate a little bit. And then when you hear 401k, to me, it's always when I was young, like it sounds like boring, right? Like it's hard to get adoption of it. But I also think that Abdul, you kind of figured you found a nice way to actually make it more sexy, more exciting in partnership with some of the contractors, some of your clients. So I just want to dip into how Rich leveraged it super successfully and how you guys helped with that. At some point in time, we'll get to that. So maybe first things first. What we do is we kick off with Rich, maybe just share like a little bit of the 30,000foot view. We do not need to go deep because really nobody gives a about going too deep. Let's just share like high level, you know, you know, where the business is at today. And then maybe just a little bit of, hey, I, you know, when you came, when you came in, you know, when you started the trade that you started with and as you started to layer, if you could do that in like a couple minutes, that'd be perfect.
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B
Sure. You know, this year we'll finish probably just short of 30 million. A little slow start, first couple months, but traction's there now. Doing really well. You know, simple. I'm a, I'm a plumber by trade. Took a job right out of high school, had no, had no plan. College was not an option. You know, ADD was just, you know, my best friend. Now I see it. But, but I, I just took a job, six bucks an hour and fell in love with the trades. Love it. Still to this day. Still love getting out there if I can. And I still do every once in a blue moon. But, you know, today, you know, we built the company to this, this size 118 employees. And you know, I love now kind of like being the guy that can change somebody's life, like technicians and whatever. Like, you know, somebody gave me that opportunity. I look where it is today. I never would have thought, you know, when I started the company that I'd be running. Shoot a $5 million company, let alone a 30 million. And you know, with the vision of being, catching up to these guys, Aaron or Chad. So, you know, it, it's, it's all about, you know, coming in, changing lives and delivering great, remarkable service to our customers.
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C
Yeah, man. You're still privately held too, right? Like, you're independent.
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B
We are and super proud of that. You know, it just, I think it's just how Things are going for us. Like, I love working with my sons, you know, the businesses help them become best friends. I just enjoy like mentoring them and watching them grow, not only with the business but as, you know, families as dads. Um, so like I, I feel like I got the best of both worlds.
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C
What are, what are your sons doing in the business? What are their roles?
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B
So Evan is the younger of the two. He's the coo, he runs day to day operations. And Connor's our install manager slash technical expert. Both have been in the company right around 10 years.
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D
Rich, one question I've got for you because, and first off, congrats on all the success. I think some of these stories are just so cool to think about. Hey, I started here, I had no idea. Hell, I didn't have any business running, you know, a small company, much less what I'm running now. I guess if you look back like, because I think this is important for leaders that are like scaling these companies. Like, where were like the inflection points where you felt like I needed to re. You needed to reinvent who you were as like a leader. Like I can't be the, I can't be the Same leader at 5 that I am at 10, 20, so on and so forth. Like, where are those things? If you can, if you have any examples of like things like, oh yeah, we got here and I had to drastically change how I looked at something or how we operated, so on and so forth.
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B
Yeah, I think, I think, you know, early on, I think getting to that 5 million dollar mark was probably one of the, the first ones because I think that's where you lose, you lose a little being able to control everything that happens in your world. And like it's kind of like really where I probably started bringing in my first real managers. I might have had somebody called the manager, but like they weren't, you know, I didn't know what I didn't know yet. And so I think around that 4 or 5 million dollar mark, you know, big deal in 06 or yeah, 06, I joined Nextstar and that kind of gave me like the foundation or the blueprint that I needed to like be like, all right, this is, this is what you need. And I think it elevate when you start networking with some really great people. Like, you start understanding you're doing shop visits and like, you know, you're doing a lot of training. And I think that getting to that 10 to 15 was probably that next, the next spot because then you're almost, you know, Filling out a full management team where you have department heads, right? Like accounting does accounting and call centers, call center separated from dispatch. And like, I really think the organizational chart jumps in around there. And then I think the next big one for me is me getting the hell out of the way. You know, like the last couple years, I spent two years mentoring my son Evan to take over the, the day to day and it was pretty awesome. I gave him some of the most amazing training. Chad, I had him out to your place a couple years back, if you remember. And he, he's done, he's done a phenomenal job. And when I gave him that role, I was like, hey, you know, you got to do me one favor. You got to make service professionals young again. And because like, you know, us older guys were like, you know, we're kind of set in our ways. And like, you just see the energy of the young kids coming into the trades or starting their companies. And I was like, I want that again. Right. And I think it really gets me fired up watching them, you know, go at it. So the majority of our managers are. Are low 30s, if not late 20s.
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C
Hey, you. So you talked about, you know, when you and I were going back and forth rich about you along the way. You have a lot of really tenured staff. Like you have a lot of your employees, which I think is awesome because that says a lot about the, the business. It's like how the business run the culture of the company. Right. Because I think turn can share those things. But you also mentioned, and you, by the way, and, and it's like when you have a lot of tenured employees, like tenured employees like that you start to create some like, stronger relationships than just employee, employer like, employer type of relationships. Like you build these relations just I think it naturally happens, you know. But you said also that that also could have been part of what was maybe holding you back
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B
for sure.
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C
So, so maybe like explain, maybe talk about that. Like, what do you mean by having all these tenured, loyal employees? How could that be holding you back?
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B
Well, I think it's. It's not having them in the right seat. Right. Like, so I have, you know, somebody that's been with me for 16 years. He's kind of our operations manager, but like he was never cap. Matt's not capable of running the day to day. Like he's good in his lane and you know, unbelievable trades person, really good at understanding what happens in the field. But he could never do Evan's job. But I was kind of leaning on him to be that guy. But he, you know, he avoided anything call center related any, you know, doesn't really appreciate the financials. You would, would go through the motions but he was not the guy. But that I was hoping that was going to take over that, you know, that position. And, and I think that there's other people that I guess I got too complacent with and I left them in roles that they shouldn't have been and you know, as you're pushing for growth and I know, I know you guys all know this, right? Like you sometimes have to get people out of the way, right? And it's, it's a fine line because I do have, I probably have, you know, 15, 18 people that are with me like 15 plus years and I, I would say the average person here is probably like 9 or 10.
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A
Wow.
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B
You know, so it's, it's pretty cool. And we, we home grow a lot of people so it's easier to get tenure that way.
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C
Listen up VIPs, I hope you're enjoying the episode so far. Listen, I wanted Yelp to give us something, so I said, yeah, give me something I can share specifically with the listeners. And here's what they wrote verbatim. New multi location advertisers on Yelp may qualify for a 20% bonus advertising budget when they start campaigns before September 30, meaning Yelp puts extra ad dollars on top of whatever you spend. That's free money. So fill out the form@business.yelp.com homeservice VIP or just go to the show notes and click on the link and the help team will reach out to you to help get you started asap. One of the biggest mistakes operators make is assuming they know what's happening in the sales process. The reality is most managers don't have time to listen to every single call sitting, every ride along or review every sales conversation. Sales Ask solves that problem. Chad and I use Sales Ask at our roofing company and seen great results. Their AI helps you review real conversations, identify coaching opportunities, spot the missed steps, and understand exactly where your team is winning and losing deals. If you're investing heavily in Legion but don't have visibility into your sales process, you're flying blind. What are you doing? Book a free sales visibility session with Sales Ask and mention to the point Home Services VIP room to get your free exclusive listener offer.
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E
Rich, I'm so fascinated by the early days. Like you started out as a tech on your own. At what point where you're like, let's make this a business. Like, let's not make this only me. I think your, your brother in law, your brother joined you early on, right? And then from there to grew and, and as, as the business I think. At what point what did you see in the market, like what opportunity exists in the market that you are like, oh, this could be bigger than just me working as a tech. This could be like a bigger, bigger, bigger franchise, bigger thing because now you have 100 plus techs working for you. You're doing absolutely fantastic. Congratulations. You built an incredible business and you've helped so many people. So I'm curious, what did you see in the early days and at one moment where you were like, oh wow, this is like more than me showing up and doing my job. I could, I could build something bigger here.
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B
I, I mean I think back from when I was even in school, I, I was an entrepreneur, right? Like I, I was, I always wanted to go out and hustle and make money and been working since I'm 12. And when I, when I got into the trades I was already thinking about a business like I don't know, maybe a year in and in it like I really got the, the opportunity to study. You know, you go back to the PM magazines and Frank Blau writing articles in there and you know that was kind of the, the inspiration. What we watched, we had a plumber that was here was one of Frank's early adopters and I, and I watched him and I became friends with him and yo, I just, I saw them doing it different and you know, I was like, that's what I want to do, right? And you know, I was running a small plumbing company before I started service professionals and the one thing I wasn't going to do is put my name on the side of the shingle, right? Like there was no way I'm doing that right. And so when I sat down and thought about it, it's like I want to change the way that the industry's perceived. And you know, I thought the greatest way to do that was like, I want to, I just want to run a professional service company, right? And that's kind of where service professionals came from. There wasn't no really great brainstorm. It was just like, hey, I want, I want to set an expectation for the customer from day one. It won't be my name and I want to, you know, I want to just live up to that standard of being a service professional. And that was, that was it.
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C
Your brand promise is in the name of the company. Yeah. Hey. Hey. What. What year did you start the company, Rich?
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B
1994.
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C
1994. So, Chad, you were eight. Yeah, Aaron was actually.
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E
Remember that. If I could have answered that question for Rich, because I remember first time I went out to Union, New Jersey, to meet Rich, you know, I sat down, I was like, rich, you are a founder. You're an entrepreneur. You're a business owner. Owner I started a couple years ago as well. You know, you're doing 30 million right now. We're doing three or a fraction of your size. I'd love to learn from you. Like, tell me more about service professionals. And he told me that amazing story about how he started service professionals. And he wanted the name to signify a big brand and that we are like a professional business where, like, you can rely on us, you can trust us. Our guys are dressed in uniforms. Our trucks are uniforms. And I tell him, when did you start? And he tells me, 1994. Which was. Which.
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B
Which.
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E
I was born in 1994.
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B
Man. You guys are. You guys are killing me here.
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E
I was like, that's awesome. I was like. I was like, I'm not gonna tell him that. But I was like. I was like, rich, that's awesome. Your company is as old as I am. You are an absolute legend. Like, like, absolutely.
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C
Well, I need you, Abdul, to respect all your elders on the happy room here today. Okay, well, listen, I want. I want to go back to this. I want to go back to this, you know, young stat. I mean, do a question for. For you, Chad and Aaron. Would you. Do you guys have any idea, like, what the median of your leadership is, like, age wise? Are you guys in that? 30, 40, 40, 50?
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A
Yeah, we're probably in the young 30s overall. Most of it, too. Right now. Our. Our workforce is very young. Our average workforce, I think we did the last, like, six months was like 20, 26 or 27 years old or something. Is our average, like, workforce, employee age. And in some of the trade lines, it's actually younger. Some are a little bit older, depending on the trade line. So I don't know about Chad.
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D
Yeah, most of our leadership team, we're maybe skew a little bit. We're probably, like, late 30s, early 40s is probably our average, I would say. And then, yeah, workforce, we're about the same. I mean, I tell myself. I don't. I love walking around and talking with the guys. I also hate it because I'm like, how old are you? Like, what? Like, God, I'm getting old every day. They keep staying the same Age, right? It's like, God dang, we keep bringing in all these young guys.
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E
Do you guys think it's going to continue like that? Like with AI? Are you seeing more and more people, like, not go to college or quit and just come and become tradespeople? It seems like it's way more rewarding right now to go to a trade school and become a tech than to actually go to, you know, go take student loans and go to college and have a useless degree of some sort. Are you seeing your workforce, average age, like, trend younger over time, do you think, like, in five years from now when we have this conversation again, like, your average is going to be younger than it is today?
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D
I think it'll be younger. I think what I'm seeing is like, you know, the talk was back, like, call it 2020. I mean, when we started our school in 2020, we had a lot of what I call career changers. So, like, people had been out in the workforce for five, six years, didn't really find out what they wanted to do, wanted to get into the trade. Whereas, like today, I feel like there's those same people are still out there, for sure. But I do feel like we're getting a lot more interest, like, a lot more, I guess I would say serious interest from people that are coming out of high school that are, you know, maybe haven't spent as much time in the workforce that are like, hey, the message has landed. I've been hearing it for the last four years. I was in high school. I think another big piece is at least here in Indiana, they've changed, like the high school graduation requirements. So, like, they've made it so that people can do more work study and obviously trades being a part of that. But there's other careers, you know, wherever it may be. So I think that's been a big piece of where, like, some of these younger kids are getting experience in it. Whereas before it's like, well, I never had any exposure to this. I don't know what a plumber does. So, like, I get it, it'd be cool to be in this, but I'm not sure what even that entails. So I think it'll continue. I think the good part is, is I think that, you know, as we talk about the trades, I don't think we're going anywhere. And the interest just keeps on getting. That drum just keeps beating louder and louder, which I think is great for everybody.
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B
Hey, Chad, do you prefer. Do you prefer somebody changing careers or do you prefer to get the young Young kid, almost out of high school.
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D
So I was very particular in saying we have a lot more people that are really serious coming out of high school. So, like, a few years ago, when you would take school, kid, it was like we were still. We were like, raising a high schooler. Like, oh, God, you gotta get. You gotta get to work on time. Did you pack your lunch? Did you do this? Like, all this stuff is like, I don't know if this is worth it. Whereas now, like, the. The guys coming out, Guys and gals coming out, like, they're dead serious. I mean, I work with a really cool organization here in Indianapolis called High School Hustle, where, like, the whole program is, like, designed around creating entrepreneurs in high school and stuff like that. It's super cool. Like, to see how dialed in some of these young people are is, like, one of the most energizing things, because they're like, I'm building this business. We're going to be 10 million next year. I'm like, let's take a few steps back.
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A
All right?
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D
You don't. You don't have your driver's license yet. Okay, let's get that first. And then we'll work on being able to buy a pack of cigarettes, and then we'll start building this $10 million company. You know, like, we're going to get there, but, like, let's take it one step at a time. But, yeah, I would say I feel like this generation is. They're getting more exposed to it and they're getting more dialed in at a younger age and ready to. I mean, hell, Aaron has, you know, his son just graduated from college.
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B
Well, I.
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D
It seems like just yesterday, but it's been a whole year at this point in time. But yeah, I mean, another kid that's just like, super dialed in knows what he wants to do. I'm sure Aaron would tell me otherwise in certain circumstances, but, you know, for the most part, he's doing pretty well.
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A
I agree with everything. I don't want to have to repeat it all. I agree with everything that Chad has said. I think that's it. The biggest issue that we have seen with younger isn't so much that people are engaged, actually, that insurance is harder to handle if you're under 21. So really, the insurance has been the biggest issue for us to be able to bring on young talent. And I've had to have debates with insurance companies about this is like, you know, they're like, well, we don't insure unless they're over 21. You have to do a rider. There's all these other things that come into that. So some of that has been policy through insurance a little bit. Not that I'm here to blast insurance, but maybe is that they are kind of slowing down a little bit that, that ability. I don't know what you've seen by state obviously or not, but we, we have that here and that's been. One of the bigger issues is getting that young person out of high school. It's 18, 19, similar to me. I mean I joined the trades right out of high school. Right. And was driving and working. Obviously insurance policies and things have made. Must have changed since then. You know, I don't know that I wasn't, you know, didn't have that type of information. So I'd say that's been holding us back the most in the area. But I agree lots more people interest, a lot more talent, a lot more people around that. And I think staying on that thread of that back to what you. But you know, Rich said, by the way, Rich, haven't seen you in a while. Congratulations on your success. I know we, we used to talk text a little bit here, talk back and forth and somehow got disconnected. And I think I met you, you're maybe around 10 million or so when we were both coming up nextar and you're growing and we chatted here, there. So congrats. Plumbers by trade, right? As plumbers we should stick together a little more. But I think, I think the interesting story that you have is the collision of the young and the old. Right? I think when you say we want to be young again, I think meaning that it's like what does that mean? Does that mean innovation? Does that mean being open minded? Does that mean open to AI phone systems? Does that mean the energy, the way you collaborate, the way you rethink and how did you do that? Because that is a. Like I know you mentioned a little bit, but what, what was, what does that. It sounds like that was a, you know, a mission of yours or a mantra or something. I don't know if you're speaking it loud to your whole team or not, but, but you had to go do it. So you had to go out and say so how do you actually, how do you do that for somebody that may be in the same position as you thinking, I've grown this business, I've got all this talent. These guys that have been with me for a while, they, they're loyal, they work their ass off, right? Because they have.
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C
We.
- [28:05]
A
Chad's seen it I've seen it. But to also understand, like, the disappointing part, I don't know if disappointing, but I'll use that as a term sometimes. Not everybody's going to make it with you, right. It's not because they're not good or hard or talented people is. There's just roles that they can't fulfill. So you're trying to do. It sounds like you're trying to do a couple of things at once. So maybe you can give us a little better understanding of how did you deal with that, how did you message that and how did you end up still keeping the old guard on the team? Because I think that's something people are always worried about, right, Is how do you keep the old guard? Because you still need them, right? Because they have wisdom that you can't find anywhere else.
- [28:41]
B
I think for me, it was like just knowing that it was time for me to get out of the way a little bit, right. Like, I love being a part of it, but I don't, you know, I don't want to do the one on ones. I don't want to do the reprimands. Like, I want to. I want to be. I guess it's right. Adopting EOs years back, right? Like visionary integrator. Right? And I knew that I needed. I needed an integrator. I went through a very painful process trying to put an integrator in place. Hired recruiter, bring somebody in, didn't work out, get the next one, he doesn't show up, right. Like, and it was. It was just tough. And during that whole time, right, Evan was already being mentored. And, you know, like, we had already. We had probably already brought in a couple younger people. Like, my call center manager was super young and, you know, four years now, like, doing a phenomenal job. And, you know, we had a couple other young people on the team that, you know, you just saw a lot of potential and you. And you know, those people pretty quickly, the ones that are just different. And when I, When I put Evan in the role of coo, you know, like, you know, first thing I asked him to do is we need to go get. You know, actually he's. I think he said it was like, we need to get a recruiter, right? And then the recruiter was where everything started to change, right? And Brock, Casey. And Casey's like a big deal in our. Our company. Not just the recruiter. He's head of growth, works tirelessly on it. Casey's 30 years old, like, played in the PE Space Accountant, but didn't like any of that, he happens to fit in our company perfect. It's kind of like Evan's number two. And you know, with those two guys, I was like, all right, let's, you know, we need a new warehouse person. You know, we need, you know, we need a couple new managers and we, we upgraded a couple people from within and next thing I know, like we're, we're early adopters in a lot of stuff in, in past life that's got me in a little bit of trouble. But, you know, where we're going with AI is pretty, pretty incredible. Like, you know, Casey has everybody with a Claude co work agent. The things that we're able to dissect quickly right now is just, it's kind of mind blowing how quickly this stuff works from, you know, where we're, where we're, how we're looking at warranty calls and why truck inventories. What needs to come off? Like it's, it is like it's across every single department and you know, it's that energy that they bring and it's like, you know, not that we're tarnished, but I, like, I guess I've, I've been scarred so many times over so many things that I can't see things as clearly as somebody who's never gone through some stuff. So I might not take chances that they do. And I just, you know, me and a couple other people, we just try to be the guardrails and you know, all right, that one won't work and you know, but I, I'm, I'm, I give them a ton of autonomy, right? I'll let them make mistakes. I don't, you know, I don't mind. I think there's so much learning in a mistake that there's no, you know, as long as I'm not losing a million bucks on something like, you know, go ahead, go screw it up. Like, I've screwed up plenty of times. So. But it, I, I, they, they make me, you know, they get me fired up on. Even with AI like just where we're going with it, you know, with Claude just, it just blows my mind. And every single decision I make now
- [32:27]
C
you're spending thousands to make the phone ring. But if your CSRs aren't picking up or converting, you might as well light it on fire. And what are the largest businesses in the country doing about this? They use Avoca, the leading AI platform in the trades. 100 million dollar businesses like HL Bowman are operating with only 9 CSRs. Because Avoca handles up to 80% of the calls. Plus Avoca follows up with your leads, grades your CSR calls and helps you strategize. So my suggestion goes with the leading company. Check out Avoca AI. That's A B, O, C A I click the link below to the point. Listeners, listen up. What if the biggest thing holding back your business isn't marketing or hiring, but your bennies? The benefits for home service companies, a better 401k can be the difference between great techs and losing them to the shop right down the street. Basic Capital, our newest sponsor, is the only 401k built to actually put your team on a real path to retirement. Companies that switch over see higher participation, happier teams and dramatically low turnover. Because your crew finally gets a plan that's a true benefit, not just a checkbox. Don't wait until your best people walk, make the move and click the link below to get 12 months with 0 employer fees when you join Basic Capital.
- [33:49]
E
Yeah, I love, I love Casey. I love Casey. I still remember. So the way we got introduced originally to service professional is via Casey. So we like for context we are a 401k provider. We usually work with companies like high tech technology companies, AI, defense manufacturing. But these are companies that have like massive worker shortages. And one day we get our head of growth at Mesa Capital comes in, he says there is a guy in Union, New Jersey, a plumbers and H vac company, they would like to buy our 401k platform. And I was like I'm sorry, what? Like we usually service AI companies. And he's like yeah man, they, they really want to, they, they seem like, you know, you got to talk to Casey. And I said that I talked to Casey and then I talked to Evan and eventually talked to Rich and it was very clear that service professionals wanted to make the place young again and to do that. And they were thinking from a, the very first principal perspective. How do we get, how do we make service professional exciting place to work at and how do we make service professional a place where you know, an 18 year old guy or girl leaving high school choose to go into the trades versus to go into college? Or how do you make somebody who is very talented that can go work for the next shop come and work at service professionals? And it's very clear that Casey was like a. Casey and Evan were just very serious about just making service professional that place that people would want to work at
- [35:26]
B
for sure.
- [35:28]
C
Chad, what were you going to say man before I jump in?
- [35:30]
D
Oh, I was just going to tell Rich that like what the story you're telling about you and your sons and how you're like approaching it. Like I think that what you're doing, while you may or may not notice it, I'm sure you have by now, like that is the exact blueprint for how we kind of transition from generation one to two is I came up with a lot of stupid ideas that he let me do. And again it was like, well, as long as you're not going to like set the place on fire, like, you know, go give it a whirl, see if it'll work. And to me, I think, you know what, I always tell people that because to talk to a lot, given kind of our background of, you know, family owned business and handing it from one generation to the next, it's always like, how'd you do that effectively? And I always tell people it's one, we got very lucky and that my dad, I feel like had the right mindset in doing it and like, hey, you guys can carry this on. But then two, I think it was us, myself and my brother kind of crafting our own vision. Like service professionals can be something. But even as you've stated, like we want it to be different than when I ran it, like we want it to be, you know, you categorize it as younger and more energetic, but I'm sure there's more to that of like, hey, these are the things that we did. But like, oh, you guys, you guys have a whole different perspective. You may not have the baggage that I've had, you know, being in this trade forever in a day, like, let's go implement some of those ideas and see where it takes the business. So I guess mainly just from my experience, like hats off to you, your boys are very lucky because that's not always the case in what I've seen. I've had a lot of conversations like, oh, well, I'm not sure we're gonna, let's, let's back this one on up and see if we can't figure it out. But definitely hats off to you. And I think that's something. Listen listeners, I'm sure there's plenty out there that are thinking about handing from one generation to the next. Like how do I do this effectively? I think you would be a huge resource for how to do that really effectively.
- [37:28]
B
And Chad, what's interesting is, you know, at, at the last suit next door, super meeting like you, you can, once private equity is now out, you can actually see a lot of next generations. Yeah, it's Pretty interesting.
- [37:42]
D
Yeah, but I think that's, that's another piece to what we were talking about earlier where you talk about these young people being very interested in the trades. Whereas I know when I was coming up, like, I don't know how to work on a furnace. Like, why would I get in business with dad? Like, I don't know what I'm doing. Lucky for me, I kind of like, kind of fell into it to a certain degree and then fell in love with it. But I think that, that to me bodes well for some of these second generation businesses really coming up. And you've got these kids that are dialed in and ready to take it to the next level. And I think too, with the introduction of technology and a lot of this stuff, you're getting a lot of where they're interested. Like, oh, I can use AI to like affect this business. Like, yeah, there's a little tighter connection there, which I think is awesome.
- [38:22]
C
You know, totally random. I just thought about as you guys were talking, you took me back down memory lane and I just connected some dots on something. You guys are going to appreciate this. Oh, boy. Yeah. So you know, 1993, Cristiano back in Crawfordsville, Indiana, at South Montgomery Junior Senior High school. Because junior high and senior high were one school. We still had, you know, shop classes. And I remember I wasn't a great student, but, you know, good enough. I remember I had to make a lamp. I had to make a lamp. So I had to use wood, make a lamp. And I forgot to, I forgot to bring whatever I was going to make my lamp out of, like a football or whatever. So I just bought a juice box from the vending machine and I used a juice box to create a lamp. Not ideal. Point is, I effectively created a lamp. So I was able to plug that thing in without burning the house down. And it worked just fine. Passed past the class. Later on in life, I used those skills to become an electrician. Did you guys know that I was an electrician? You aware? Yes. I'm a man of many talents. I was electrician. That was like the first trade I actually learned. Residential and commercial belt. Those were summer gigs. I was really good at trimming out a house. Rich.
- [39:50]
B
You know, the hard stuff, that's the hearts there. There's a lot of thought that goes into that.
- [39:55]
C
I think they're still standing today. Might not be mostly inspectors to their job, but I do, I wanted, I wanted to go back down this path real quick. So I guess electrician was not, you know, in the Cards for me and Anna will tell you a funny story about at Last House. When we built the pergola, I said, nope, I'm doing all the electrical for the pergola. I did it and I paid electrician to come back and do it right. So that was a waste of my time. And I clearly didn't, you know, I followed the right profession, which is marketing for electricians and he's acting plumbing and not so much being the electrician. But I want to talk on something real quick because I did, you know, end up building a big business, right, with hundreds of employees. And we're going down this path of having young leadership, young talent. At Rhino, our talent was we had a lot of young staff and the way that, that Evan and Casey brought in Abdul's company, Basic Capital, you know, it's just one tool that they wanted to come in to kind of help with the, with the, make it different for the team. And I think that 401k when you're young and a lot of us had younger's employees, they only care about it, right? They're thinking too, too short sighted. Like, I just want to get the most money out of my paycheck now and live paycheck to paycheck versus investing in my future. And a lot of it's just, they don't even know anyway. Right. But that's how I think most would think. I did the same thing when I was young, I'm sure ag, you probably did the same thing. Like I just wanted the most money out of my paycheck, right. So I could go and blow it, that, that, you know, for that, you know, two weeks or whatever. But I want to segue into this because I do think it's interesting how you leverage basic capital for retention, number one for recruiting. And then the thing that Anna and I got really, Anna and I got really passionate about as we would look at the adoption rate of the 401k and it was so such a low percentage of all of our employees. I never understood why. And then people would come to us and ask us, well, how are you guys investing? What are you investing? And I realized they have no idea how to invest anything. Like some of them have 10, you know, grand sitting in their savings account, you know, or 20 grand sitting their savings account. They have no idea. So we started to say, well, we'll just use our team to start to do some of the coaching of the people that ask because they didn't know how to leverage money or how to use or why a 401k was important. They just didn't know. So I love that your younger guys, you're, you know, and Casey and Evan brought in basic capital for. To help the employees understand and maybe a little bit for themselves, selfishly, I'm guessing, Right. To understand how?
- [42:10]
B
Well, yeah, for sure.
- [42:12]
C
Talk about. Talk about what? Talk about two things, because we're getting close to the, you know, we're gonna do the VIP top three or the VIP top three questions, but just talk about. They brought it in. Great. How is implementation? And. And how's it going, like, today? And is it doing what you hoped and what you expected it to do?
- [42:30]
B
Yeah. So, you know, when we brought it in, there's, you know, one, we're trying to bring the benefit to everybody. But two, I feel like, as a leader, it's our responsibility to help educate the team that, like, don't wait till you're.
- [42:44]
C
You.
- [42:44]
B
You can't wait till you're 40 to start saving for retirement. Right. There's not enough time. You got to use compounding as your.
- [42:52]
C
You said don't wait. Now we're waiting.
- [42:55]
B
Yeah, there we go. You know, you got. You got to use compounding to your benefit. Right. And you need to start as early as possible. And, you know, when we saw it, first of all, like, we were looking because. Also, because we were having a terrible experience with the 401k company we had. They're absolutely a train wreck. And I know there's nothing really sexy about 401k, and we don't really talk about it a lot. Out of sight, out of mind. But. But, like, I felt as a leader, we need to take some responsibility for educating the team to get them involved in the 401k, because we had the same thing, Chris. Like, you have very little participation, and one of the things you're having is your highly compensated employees were getting money back at the end of the year because there was nobody else contributing. Right?
- [43:40]
E
Yep.
- [43:41]
B
So as you're scaling the company, it, you know, that's a little bit of a problem. So, you know, when we, you know, when those guys brought it to me, like, I was all in because I. I felt like, you know, we needed to do this education. We did a couple things before with Dave Ramsey to try to get the, you know, financial acumen up. But doing this, the one thing that was really cool is when we decided to bring it on, you know, when we did the rollout with everybody. And I'll let Abdul talk about, like, what, you know, how basic capital works. But you know, like 70% adoption when we, when we did the rollout, which I thought was absolutely incredible. And you know, it's, it's. They need, they need some, they need some motivation to get in the game, right? And I think basic capital gives them the opportunity. You don't have to, but the opportunity to get this leverage that you need to feel like you're going to, you're going to scale it, right? So, but I do think that it's important that we, we constantly have conversations around it. Like, it just can't be you sign up or you hire a new person and it doesn't get talked about. Like, we need to make sure that everybody understands that they need to prepare for retirement. It's part of our, you know, leadership responsibilities. And it is like, you know, it's like Chad was saying before, like, make sure they have their lunch and did they brush their teeth. And like, you have to go through it, that, that painful stuff of being the chief REM Officer to make sure that they, they're, they're participating because, you know, guys like 10 years ago, like, was like yesterday. And you know, if they lose 10 years of their retirement time, right, it, it'll cost them a fortune.
- [45:30]
E
Well, also, like, people, people want to work at the place. Like, people want to work at a place where they feel like they're getting richer every day, right? And like, when you go, you talk to employers, they offer a 401k. Some of them offer a match, some of them don't. But none of the employees know that the employer offers a 401k. None of them know that this is even an option for them.
- [45:50]
B
Right?
- [45:50]
E
You walk around the shop floor, you ask people, who is your 401k provider? Nobody can name that for you. You ask them, how much do you contribute? They can't tell you. You ask them, what are you invested in? They can't tell you. They don't even know who is their 401k provider is. Like, I actually wonder if you guys walk around the shop floor and you say, who is our 401k provider is? I bet you 80% of your technicians do not even know. This is a benefit. You are buying, you are paying for actively. And your employees are paying for too, that nobody even uses, nobody even knows about. So if you're buying it anyway, you might as well buy it from a provider that will increase the engagement. When we showed up to Service professional, they have 30% participation rate. And then once they rolled out our program or they moved to us, it went all the way up to 70. People want to work in a place where they feel they're getting richer every day. And you look at American middle class wealth, 60% of it is a home equity. Like any rich person in America, if you look at their wealth, what is it? Unless you're an entrepreneur, most of your money is your house, that's 60% and then 10% is your savings, your cash savings, your brokerage account and then like 30% is your 401k. So if I work in a place where I feel like I'm making real progress towards getting richer every day, I'm going to be grateful and happy that I work at service professionals and I'm more likely to stick around and I'm more likely to be more fulfilled and more excited because I feel like I'm building real long term wealth and I'm accumulating assets versus just clipping that paycheck every two weeks. And don't get me wrong, there is nothing better than clipping that paycheck. But ultimately people work so one day they do not have to work. Right. And if you as an employer can put them on a path that makes them feel like one day they will not have to work and they can retire safely with you, they're going to be more loyal to you, they're going to stick with you because they feel like they are on the right long term path with you.
- [47:45]
A
Right.
- [47:46]
B
I think it's all, I think it's having a whole suite of things because. Right. Like, like every single person's emotional trigger to why they're staying with us is going to be different. Right. So like somebody has a family is going to want the health benefits and the US paying their deductible and that stuff. And somebody that's already thinking about retirement, that's going to be important. But like, I want to make sure I got it all covered. Like somebody said this to me a long time ago, it's like, dude, you got to create an island that nobody wants to leave. Right. And, and I think that that's what we've tried to focus on in having that whole suite of benefits, fringe benefits, whatever you want to call them to, you know, so that our employee, if they're looking at somewhere else are like, yeah or that's not going to do it. And, and you know, we also did it because it's also trying to compete against the PEs, who I'm not as concerned about now. But the, you know, they're, they're actually coming in and taking stuff away so like that just makes it look a little bit better for us on top of it.
- [48:48]
C
Hey, you want to know what really sucks about insurance? Before I segue into what was going to be our VIP top three, it's gonna be our VIP top one. Let me tell you what does suck about insurance is I paid all these years for insurance and now I don't have insurance at the worst possible time of my entire. I have to not have insurance and
- [49:13]
B
you have to be cash.
- [49:15]
C
So that's, that's a good time. The good news is because I'm able to afford it. So not that I want to, but now I gotta go and now I gotta start working again just so I can start, you know, back on all this.
- [49:28]
E
I gotta pay this will hire you as service professionals.
- [49:35]
C
You know, I've got a non compete. I think I can't go work anymore. But I do want to say I, I thought I know it's not excess a sexy topic to talk talk about but I do admire the way that you leveraged that you leverage it rich and the team and I think that it's cool that your younger staff has brought it to you like and they were being a little more selfless. Right. And I think that's pretty cool and leadership and trying to bring something like this to the younger, the younger group. I bet Chad and Aaron both have experienced low participation with their, with their younger staff as well. I just think it's a lack of understanding. But I appreciate, you know that you share and kind of how you guys used it and then obviously Abdul, come on and explaining like I, I didn't know how big the organization was too, but obviously I could tell you're, you're passionate about it and, and I think the best thing that contractors can do if they're leveraging someone like basic capitals, they're going to need your help on how to get everybody engaged right. To come in and help figure that out, figure out the things and do the things. So just for the sake of time, I do want to move on to this last question because I know that our listeners love hearing our guest's perspective on this. So I'm going to enter into our the VIP top three. Except it's just going to be one ag. You want to run with it? You want me to run with it? Chad, you want to take it? Wants to take it. You pick buddy. I think that go. You know the one I think.
- [51:01]
D
Yeah.
- [51:02]
A
Which one we doing?
- [51:03]
C
I love it.
- [51:07]
A
What's wrong with this industry? That's the one that's the one most people like to hear because that's put you on here. All right, Rich, here you go. You've been doing this a long time. You know, I've got to know you over the years too and I'm really happy for your success and see that you move in a positive direction with you and your sons, man. Really great man. But what is wrong with this industry that nobody wants to admit?
- [51:35]
B
I guess, I guess it, it depends on the comp, the size of the company. But like I think as a whole is there's a, there's a technical shortage. I think our, our industry puts, takes guys who know enough and they put them in a truck and they let him go. And I think that they, they, they definitely stunt their growth. And you know, I think that, that, you know, I, I think it's always been a problem like you, you've all had a guy come in like he's got, he'll tell you he's got 30 years experience, right? And you find out he's got one year's experience that was really bad. And he repeated it 30 times. And you know, that's where, you know, that's where I, I think that you have to, we as an industry have to elevate people to the highest level. Technically. I think we spend, you know, I spend a lot of time on people skills or soft skills and maybe we need to, even us need to spend more time on the technical stuff. It's, you know, in the H Vac space and electrical space. I mean it's getting more sophisticated the, the electronics and the stuff. So I, I do feel like as a whole, as a whole industry, if there's to blanket, it would be improving, you know, technical, technical abilities because I think as soon as somebody starts make able to make some money, they what? That's it. They just go do your thing. And I think that that's very short sighted because it's super expensive when they're not doing it the right way.
- [53:13]
A
Yeah, I think that came about through our time Rich, coming up through, you know, some of the trade programs like nextar no stuff is like a lot of us were very technical because we learned to trade, we did the work, but then didn't have all the soft skills. Right now I think we've leaned, leaned very hard into all the soft skills because that's kind of been the thing that we thought everybody didn't know and now we're on the other side of the technicals back. Right. So. Right.
- [53:39]
B
Yeah, for sure.
- [53:39]
A
It's kind of A, you know, just an evolution. Right again as a, you know, kind of history repeats itself. So here we are, we got, now we're back here, we gotta go here, we're gonna go here, it's gonna happen again. Right. So I think that's a great point of view and I do think that, you know, we are trades companies should be working to build great trades people and that means learn everything about their trade at the highest level and be masters of it for sure.
- [54:02]
B
And I do think AI is going to help that too. Right. Like you're, I mean you're gonna see it. We're, we're working on something now, but you have the blue ones and stuff that, that are out there that will help you. But I think that it's going to be very, I think you haven't having an agent that's very specific to the challenges that you have on your equipment or the things that you, you particularly do will be very beneficial to us.
- [54:28]
C
Yeah, I don't think this problem ever like totally is complete.
- [54:32]
A
Right.
- [54:32]
C
I think it was just evolution after evolution as, as things change and really, even really with the tools like you still got to educate them on how to even use the tools properly. Right? Like, like a blue one or whatever. Yeah, I mean you gotta have like. I do think it's today is probably in the best it's in situation it's been in just because of the adoption of AI and so many in so many, you know, guys like, you know, both Aaron and Chad have like you had schools, you have your own programs where you're kind of incubating your own people and you have the control over what you do and don't teach them, you have the control. When you put somebody like that's, you know, had one bad year and multiplied times 30 and he's got 30 years straight. I thought that was fantastic. But I think you've got more tools, you know, at your disposal, more things at your disposal today to really fix those things. I don't know, I've never run a big, you know, a big contracting company before. I can just tell you that when you run a digital marketing agency it constantly changes. And so you constantly have to educate, you constantly have to learn what you know is true and what's not true versus what the industry is hearing and all the other you have to sift through. And then oh, by the way, the tools that you use, you know, change like yeah, Google changes thing. But I do think you guys are in a good spot today to go. And it sounds like like you're kind of taking this next step, you know, to really push this 30 million year and then probably, I'm sure I'm assuming you're aiming, you know, now you're going to be, you know that you're multi generational, that you're pushing for the 50, like probably going to go. The natural progression. You want to see the company look like in order to do that too, you obviously want to take really good care of your team and so you're kind of leveraging all the things. So. So it's. It'll be fun to watch the journey, you know, and see how long you actually stay private. So see how it plays out.
- [56:16]
B
I'm. I'm a stubborn polo. So like it'll be a while
- [56:24]
C
and he might fly off the handle. You never know.
- [56:26]
B
And it might fly off the handle. Correct.
- [56:28]
C
Oh, I'm gonna go ahead and close this out then. We're about an almost an hour into this thing. So I appreciate, appreciate you guys and, and Abdul, it's cool that you could join us, man. I always love it. Kind of went up with some of our. Yeah. Sponsors can come on here and co host along with us and ask the questions and then. And Rich, you know, we talk. I'm glad to finally get you on here, man. It was good. I'm glad that you and the boys got to catch up a little bit too. I had. I didn't know you and AG knew each other from the next star days. I mean, Chad, did you guys meet in XR2 because you guys.
- [56:52]
D
Yeah, for quite some time.
- [56:54]
A
Yeah. Chris, I don't think you realize how many people I actually kind of know. Like, you know, like, I don't.
- [57:02]
C
I don't know, man. Like, listen, I feel like I know everybody so like, I don't know.
- [57:07]
A
That's what it is. We're not at. We're not at his status, Chad. Yeah, that's my bad.
- [57:13]
B
My bad aspirations.
- [57:16]
E
Great. I think he knows. He's just, he's just intentionally trying to. He's getting out of his skin.
- [57:22]
A
I haven't seen Rich and I was really great to see you, Rich. I'm so happy for you, man.
- [57:25]
B
Yeah. Thank you guys. Really cool to see you catch up.
- [57:28]
C
Yeah. Aaron just looks a little different. All that gray hair. It's all good. It just looks a little different. All right, boys, I'm gonna shut her down. What did you just say? Real quick, Rich. Thank you, Abdul. Thank you guys for jumping on.
- [57:41]
B
Thank you, Chris.
- [57:41]
E
Guys, thank you so much for having me. It's awesome.
- [57:44]
C
Yeah, yeah, yeah, of course, man. And I'm excited for you sharing your story. And then to all of our, to all of our listeners, you know, you know, I don't care what you do at the end of the day, I don't care what you do. All our job is to do is just give you opportunities, you know, from listening to those who maybe are where you at, been where you're at or where you want to go and then the things that they're doing to help build their businesses. But whatever it is, whatever you decide to do, don't talk about it, be about it. So don't forget to come back. Visit us next week. You never know which guest is going to pop on, which VIP might pop on. I actually have a couple of good ones lined up that I haven't told the boys yet on who's going to be popping on as a guest VIP coast. And I'm going to try and figure out how to make it a surprise to you guys. So you just have to sit there and wonder. But to our listeners, tune in next week for another great episode of Home Services VIP Room. We'll see you. What's the password?
- [58:32]
B
Don't talk about it, be about it.