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Steve Holland
Your most expensive customer, your employees, especially your grassroots guys that are out there hitting the pavement every day. I just had this conversation. It's funny, you ask. And somebody asked me, steve, would you go into business again? And I said, I don't know. And I'm not going to say no. But. But if I did, he goes, what would you do different? I said, number one, my employees. I would get engaged with my employees like you've never seen as a business owner. I'd be engaged. I'd know their spouses names, I'd know their children's names. I would know every hobby they do, and I would be authentic and genuinely interested in their lives. Because if they're going to give up 40, 50, 60 hours a week for my business, the least I could do is understand who they are as a person. Then. And here's, and here's. Here's a simple equation, right? If you take care of your employees, and I mean beyond anything that we've seen, you honor them, you respect them, you take care of them, you're going to have a few deadbeats in there that you got to get out of the. Get out of the pool, right? That's going to happen in any business environment. How are they going to show up at the home? What types of conversations are they going to have about the company they work for when they're trying to sell somebody a $16,000 replacement system?
Chris
This is to the Point a Rhino experience pulled in one of the top.
Chad
Home services, marketing and operations podcasts, cutting.
Chris
Through the bullshit and getting to.
Steve Holland
Hey, what's up?
Chris
To the point listeners, it's your boy Chris, the host of Ten Point Home Services podcast, along with my co host, Mr. Chatty P. Chatty P. What's up, buddy?
Chad
What's going on, man? We have been on a lot of calls and together here over the last two days.
Chris
Are you sick of seeing me? The answer is no, I.
Chad
Exactly.
Chris
Well, I have a feeling that our listeners are in for a real treat today because the guy that's on here has got some stories. But in this time, beginning this long, a long time, and I mean, when we talk, anytime you hear the word airtime 500, you know you're in for a real treat, right? And this guy was part of Airtime 500. We were talking about Jim Abrams ahead of time. So just so you have an idea for listeners who know who that is or pretty. Airtime 500, you know, we're in for some good stories, right? And this one. And. And our. And our guest does have A great story, and I'm excited for him to just share kind of how he even got into the trades and then, you know, when he exited, what the business looked like and what he's doing today. But then just to work through some of the. Some of the topics that we kind of discussed that we want to hit on, I think you listeners are really going to enjoy. But first, Chad, before I do that, you know what I gotta do, right? I do not want to let our.
Chad
Listeners down, unfortunately, but go ahead.
Chris
Okay, so, you know, it's time for some dad jokes. Okay. And. And Steve, Phil, feel free to take some of these away and use it for yourself. Okay? I'm sure. I know you got a bunch of jokes already. I'm sure of it. But these are probably going to be, you know, nice additions to your repertoire.
Steve Holland
Okay?
Chris
Okay. First one is, what kind of car does a sheep like to drive?
Steve Holland
I don't know. A Tesla? I have no idea.
Chris
A Lamborghini.
Steve Holland
Oh, hey. Hey.
Chris
Okay. Why wasn't the woman happy with the Velcro she bought? Why wasn't the woman happy with the Velcro she bought?
Steve Holland
Chad knows.
Chad
I don't know.
Chris
It was a total rip off. Hey.
Steve Holland
Yeah, I don't know. I'll help you with those jokes.
Chris
Hold on. These are dad jokes, Steve. Okay, all right, last one. Why are spiders so smart? Because they can find everything on the web. Okay, folks, that's a wrap on dad jokes. I don't know that that was my best set of dad jokes. I've certainly had better, but it is what it is. I think the Lamborghini one was the best.
Steve Holland
Yeah, I'll fix it for you.
Chris
Okay, thank you.
Chad
Bar's pretty low, so we don't have far to go.
Steve Holland
Chad, we don't have far to come.
Chris
Okay, well, let's go ahead, jump into. I want to go ahead and introduce my friend Steve Holland, who was the founder of Mr. Holland's Heating Air and Electric. And that was. I think you started in 97, is that right, Steve? 1990, which is the year I graduated high school. Shout out to Southbound High School. But started your business back then. You heard me early in the podcast mention airtime 500. And what I thought what we would do is just right out of the gate, have Steve maybe share a little bit of his background. Just so we set the stage. You guys know how we like to do it. That way you have an idea of who you're listening to. Steve was up out of Wisconsin. Wisconsin, and. And grew a fantastic business up there. But has had, you know, quite the experience. So what I want to do, Steve, is just set the tone for these listener. They know who we're listening to. You're gonna. He's really shy. He's afraid to talk. So we're probably gonna have to pull answers out of him. But Steve, one, welcome. And two, man, let it rip. Let us let the listeners know who they are listening to on this episode.
Steve Holland
Yeah. So thank you. Thanks for, thanks for having me on. So I grew up in a small city just north of Milwaukee called West Bend. So if you ever heard of Gail Co. G E H L farm equipment or skid steers, that type of stuff, that was their headquarters. Just a small community mainly, you know, the rural area was all farming. Well, anyway, my family would have made the top 10 episodes of the Jerry Springer Show. That's no joke. We probably are in the running for Jerry Springer hall of Fame. So. And when. And, and we don't have enough time to get into it. But I mean, actually on Jerry Springer. No, you're just saying they move. But I'll tell you what, that would.
Chris
Have been a great story.
Steve Holland
Yeah. No, I've never been there, but I've experienced, you name it. You know, I'm not here to throw my hardships on you guys or have a pity party, but I'm just saying here's, here's, here's how I'll sum it up. A guy like me should have never made it at anything. Okay. When you look back at our family life and history, my great grandfather was in prison. My grandfather was in prison. I've had at one time, I think eight relatives in prison. So, you know, I was surrounded as a kid with mass dysfunction, chaos. Good track record. Yeah. So I lived in 15 different homes over a 16 year period, if that helps you. So anyway, in high school, I was a screwball in high school and there was no path for college. So when I got to my senior year, of course I had to go to my second senior year because I didn't finish my first one. When I got out of school, I went to work for Gail Co. Building farm equipment. So I built belt balers and mixers and those types of things. But while I was there at Gail Co. A friend of mine's father was a mason and he did concrete work and brickwork. And he says, you kids need to get into trades. Get into trades. You have a job anywhere, you go the rest of your life, blah, blah, blah. Well, I didn't have a lot of mentoring as a kid. None, you Know, I never met my biological father, ever. He got my mom pregnant and that was the end of it. But so I always took that, those little nuggets of advice. So then, so then I'm like, yeah, I'm gonna get in the trades, you know. So I tried to become an electrician, but at that time it was difficult to become an electrician. You had to go through this whole process, you know. So in the meantime, I. Well, so 16 and a half years old, I leave home, okay, I pack my stuff and I'm out of there because it was just mass chaos. And I stayed with a friend. And then after that ran its course, I came back home for a little while and I met a gal and we hit it off and her parents were kind enough to say, hey, you can, you can stay with us until you find a place to live. So I slept on a couch in their basement at like 18 and a half, 19 years old. And her dad was in the plumbing and heating business. And he said to me, he goes, hey, do you want a job? You know, And I said, well, I really want to be an electrician. See, they didn't do electrical. There's. And so a couple weeks later, he's like, hey, we need helpers. And, you know, why don't you come on over? So I quit my job at Gail Company, took a $3 an hour pay cut, went to become a helper in H Vac. I didn't know a condenser from a furnace. I knew nothing, okay? And so that's how I got into H Vac. And that gal is still my wife to this day. She was a senior in high school when I met her. And I was on my second senior year. And I always joke and I always tell people, if she ever leaves me, I'm going with, I stole that from Zig Ziglar, just so you know. But so that's how I got into the trades. And my first week, my first week there, we're working on a job in Fox Point, Wisconsin. I'll never forget it. And this was when midi fishing 80, no, 60 to 70% efficient furnaces, like Lenox Duracurve, you know, stuff vented to the chimney. People are starting to go to condensing gas furnaces. So I'm outside drilling with this right angle drill with a three inch hole saw. That's when you had to run big PVC and all that. And this thing kicks and knocks me in the jaw, Sends me sailing. I saw stars. I'm not kidding. I thought I got Hit in a UFC fight, you know, And I had a thought. I really did. I'm like, why did I do this? I had a good job, even though it was a factory. And all that week later, I'm in an attic in Shorewood, Wisconsin. It's like 90 degrees out. We're installing a UNICO system, and I'm just sweating. Another revelation. Why am I doing this? And like, a couple weeks later, I'm in a crawl space, an old farmhouse, and I'm looking to run some refrigerant lines. And I look, here's a family of raccoons down there. And I got to go right at them to get this line set out. And all of this time, I'm thinking, why did I quit my job and get into the trades? And then over time, is the best thing I ever did. Best thing I ever did. You know, granted, I've been in many addicts. I've done all that. So there's a. There's a real fond place in my heart for trades people. The men and women that are out there in the trenches every day in the trucks, in the attics, in the crawl spaces, dealing with, you know, you name it. Those people, those are the people that I really have a shout out to and want to protect. Because, man, without them, guys like Chad, your job would be really difficult because, you know, they're out there just humping it every day to keep the customers happy. And, you know, so. So that's. That's a condensed version of how I got into the trades. Well, then what happened was my wife, so the gal that. That I met, we get married in 1994. She's 19 years old. We got engaged, and at 19. And then a couple years later, we get married in 94. Well, by 96. What do you think she's asking? She wants a baby, right? Well, I work at. I work at Cliff, Bergen and Mequon. She works at West Bend Mutual Insurance. And I said, I'll tell you what, let's throw in the towel. I'll start a heating and air shop. And so that's how I started it. And how I started it is every year I'd get laid off in the spring. So the company I work for, they said, yeah, we get slow in the spring. You might have a couple months off, by the way, that's something I did at my company. I never did, ever. I tried. I mean, I'd give guys voluntary time if they wanted it, but we found stuff for them to do because you don't want people unemployed because then competitors will take them. So I go to this hardware store, right? And when I walk in, there's a Lenox Pulse furnace sitting on the floor. And because I was laid off, my wife had a honeydew list. You know, she's like, well, we need shelves in the. In the closet and this, that, and the other thing. So I said to the guy, I said, hey, what's with the Lenox Pulse on the floor? He goes, oh, that's how I heat it. He goes, what do you know about them? I said, I work on those. I'm a service tech. He goes, oh, maybe I'll get your number. My guy's retiring. Here's the entrepreneurial mind. He tells me, the guy's retiring. What do I say? Hey, I wonder if he has any tools or stuff for sale. Well, I don't know. His name is Earl. Earl Empkey. Lives in. Down in Florida now. Gives me Earl's phone number. I call Earl up. He's like, yeah, I'm retired. I'm selling everything. This is no joke. So I go over there that afternoon. We do a handshake deal for $10,000. I don't have $10,000, okay? My wife's pregnant. I buy everything. I had to come up with the money. And that's when I started. My company is in 97 that spring. And my wife's like, what are you doing? You know? But I just see when you come from nothing and you have absolutely nothing, it's not everything is up. Everything is, you know, again, everything is a goal. Everything is better. And falling back to nothing was easy. I have already been there. I know how to get back out of that. So I bought his company, and he gave me the phone number for free, which is kind of funny, because nowadays that stuff is gold. And I started. I started my business, and then in July, my daughter Kayla was born. And Kayla's in marketing. She works for a home services company, a large one, very large. And she was born. And the day she was born, it was like a couple days later. You bring them home, you know, from the hospital. And it was like 92 or 94 degrees out. And I had a pager at the time because I just started my business, and I'm starting to get service calls. And this is cool, because I just started the business, and I'm telling people on the phone in the. In the. In the hospital, hey, I. You know, I got to get my wife and a baby home, and then I'll come later on tonight. My wife's like, no go. My mom will get me home with the baby. So I ran service calls and we have a picture of my daughter and my mother in law picking up the baby, you know, or picking up, picking up my wife in the hospital. So that's, that's, that's how it all.
Chris
Started because you're out there getting after it. You got a baby you gotta support.
Steve Holland
Now got a baby to support. And literally I worked seven days a week for seven years straight to, to support the family my kids have never seen. And I'm not knocking know I'm very careful when I say this, but that's the goal. My wife never wanted to go to college. She said I want to be a stay at home mom and I want to raise a family. And so I said okay, as long as you don't get mad at me for working all the time, we'll do, we'll do the deal. And she'd answer phones and do bookwork in our house and I would run calls morning, day and night and install, I mean I was, you know, could install and, and, and, and, and that was how it all started.
Chris
And so then you, so to give an idea, the listeners and I will for one, thanks for that. And two, impeccable timing. Launching a brand new business as you're having a baby, but mortgage and a mortgage. You said, you know what, let's see how difficult we can make this. Let's just do it all at the same time. But the, you know, you, you had a, I mean you talked about that's how you got into it. But you had a successful run in the business too. I mean it wasn't like you, you were able to build a, you know, a pretty good business too. And especially in a time when you know, those businesses were kind of few and far between. So maybe just let the listeners know before I go into this next, this next spot. But you, you ended up exiting in 2021 by the way. Well done. Mr. Perfect timing on that one because couldn't ask for a better timing to, to make an exit. But maybe just let the listeners know because you said heating and air conditioning company but you, you also have electric attached to that business. I'm not sure if electric is attached to, that was add on or whatever. But where was the, what was, you know, what sizes was the business whenever you sold it in 2021?
Steve Holland
We were on pace. I sold it in June of 2021. So our run rate that year, our pace rate, we were, you know, calendar year financials. So we would have probably been 10 to 12 million at that point.
Chris
Got it. So. So when you, you came out of the gate with your own business and it was heating and air conditioning, when did you add electrical to the business or did that like. Well, you're already kind of doing it out of the gate too. If a call came in, is it kind of doing all this? Like, what would that look like? Sorry for the interruption. To the point listeners, have you heard of Rilla? Are you using really yet? If not, are you Farilla? See, what I did there really is the leading speech analytics software for the trades. It is on a mission to bring physical ride alongs to an end. You can coach your reps with virtual ride alongs now that are a hundred times better, faster, and much more efficient than the physical ones. All you got to do is use the killa Rilla. That's R I L L A Lilla.
Steve Holland
No. Wisconsin's heavily regulated with regard to licensing. And, you know, it's. It's a little more difficult here than it is in in other states. But what happened was we were running so many installs and you have to have. In the state of Wisconsin, if you change conductors and do these other things, you have to hire a licensed electrician to come in and to make it legal. And we were spending a strong six digits on subcontractors, and I decided that we need to just bring in our own electricians. So I found a master electrician to work for me, and that's how we launched it. And then a little later on, a gal that was in my office who was instrumental. Matter of fact, I recruited her out of Subway Food. She's still with the organization. She helped grow the organization. North of 20 million. Her husband was an electrician. So I sat him down and said, hey, would you guys be interested in doing a deal? I'll make you partners, but let's get this, this electrical thing off the ground. So I made them partners on the electrical side, and that's how we got electrical going.
Chris
Got it. Okay, so let me ask a few questions because you and I had a phone call, you know, a few weeks ago. You know, we were just kind of talking about and catching up and, you know, meeting each other and. And you said something, you know, that, you know, that or someone that you worked with that kind of caught my attention. And one thing that you, you know, you. You did a good job of was writing radio ads, right? Doing. Doing radio ads. And you did that with a legendary, you know, guy, Roy Williams, wizard of ads. So, like, how did that Come about, like, were you like the radio ad man? Like the radio jingle guy? Like, what was it? You have a voice for radio, Steve. You got a voice radio. But, like, you just. You just came up with these crazy ideas, and then you're able to write these radio. Like, is that the gift that you had that kind of helped?
Steve Holland
Yeah. So there's a little more to the story, and you'll know that. So. So when a president gives a speech, okay, you know, he didn't write that whole thing himself. So there's. There's writers. So what happened was going back, if we go back into the. The late 90s, early 2000s. John Young, who was Jim Abrams partner, he was friends with Roy Williams and Roy. I met Roy. We were in. I forget what city. I don't know if it was St. Louis or if it was Omaha or where we were. But we met. And Roy had a client in Milwaukee that was a jeweler, Kessler's Jewelers. And their ads always stood out to me while Roy and I talked, and that was the end of it. But what happened was Roy had started a relationship with One Hour, and they were doing a lot of our ads at the time when we were with One Hour. So they would do canned ads. But then later on, we started doing our own ads, and I started doing them. Now what I do is I come up with the madness, the craziness, the weirdness of the ads. I come up with all that, and then I send it to a guy named Ryan Patrick, who is a wizards partner, one of Roy's wizards partners, Tim Miles and Ryan Patrick. And these guys are good. Ryan is probably the best ad writer that I've ever seen. The guy is magical with words, I think. Even so, more so than Roy. Now. I'm not picking on Roy. Roy will tell you that. Roy will tell you Ryan's a great writer. So I just come up with this weirdness, and I send it off to Ryan, and we have a great working relationship. Matter of fact, I just recorded radio last week right here in this room. I have a mic and all that over here. And that's how we do it. And we've been doing it so long. 20 plus years we've been doing this, and it works. It works. But there's so much to that. I mean, we could do a podcast just on messaging and radio and strategy. It's. It's almost incredible when it's done well and done right, what it'll do to your business, like what it'll do to your metrics with regard to your paid search and your, you know, your digital advertising footprint and all of your other campaigns, they just, they just yield way better results just because of radio. So that's, that's how it came to. But I've been down to Roy's Wizard Academy. If you guys could get there, get there. I mean, it's. It's great. I don't even know if he's teaching magical worlds anymore, but I took that years ago. I learned so much. Steve.
Chad
One of the questions I have, and this comes from a conversation Chris and I had yesterday. You know, you. You start with nothing right from the ground handshake agreement to. To buy Earl's company, and you grow a business, you exit. What would you, looking back, knowing what you know today, what things would you have done differently to maybe scale it faster? Or like, things that, like, yeah, we got it to this level, really proud of it. But, God, if I would have just done these couple of things when I was, you know, 1 to 3 million, God, we could have got there a lot faster. It had been a lot less painful because it's something I think about all the time as I'm, you know, thinking back of, like, what was it like? And I'm like, God, we missed this, we missed that. That wasn't great. Must have got lucky there. Different things like that. Like, if you think back, what, what are some of those things that, you know? And I think it's important for listeners that are, you know, thinking about scaling it to 10 million, 20 million, whatever it is, things that they should be focused on early on.
Steve Holland
Yeah. So scale scaling is such a buzzword right now. And there's all these gurus out there that never spent any time in our industry, and they're starting to give people advice on this. And it just, that really frustrates me. I really does, because it's like, there's more to this. There's way more to it. And I don't like. I don't like the gurus that come into business or try to tell. Try to sell people a bunch of stuff, and they're going to help you scale your business. First thing, I'll tell you the first thing I do, and I, And I work with some businesses now at a small level. They. I've had. I had one come to me not long ago and said they want to scale their business. The first question I ask is, why? Why do you want to scale your business? And as soon as I hear that, I all of a sudden start to hear reasons they shouldn't. Be scaling their business. Okay? And so the first thing I will share with you, scaling your business. Number one, if you have, if you're operationally sound, if your business is not operationally sound, I do not recommend scaling. And I'll give you some examples. Are you priced properly? What are your gross margins look like? Are you, is your net profit double digit, strong double digits? And I'm not saying 40. I always like to see north of 20%. If your profitability, both gross margin and your net profit are where they need to be, then we got to look at the business and make sure most of the inefficiencies are out. Because if you take a business that's 5 million in net in gross sales, okay? And you have 10 problems in your business, now you want to scale it to 10 million, okay? But you never fix those, those problems. Guess what you did, you just compounded those problems. And I witnessed that even in my own business. So you can do it. So, for example, let's say you want to scale your business and you do have some operational challenges. I would suggest you put a team together to work on these and then another team that's going to help you scale if you want to do it at the same time. Now, some of our, some of the people you're talking about don't have that capability either A, they don't have the financial capacity to pay for all that, or B, they just don't have the right people. First thing I say is fix those problems. You get those problems cleaned up, now you start to scale. So now to answer your question directly, what types of things would have I done differently? I probably wouldn't have been, I probably would have let my entrepreneurial spirit run a little stronger. So what I mean by that is I was always, I would hold back a little bit. I'd hold back because of the risk, even though I've taken all the risks. But as soon as you start to get comfortable, and we were very profitable, growing company, great culture. Every now and then you get a bad egg, you deal with them. But strong positive culture and some of these other things, I held back a little bit when I could have just taken off, you know, I mean, but when you're doing, when you're making a lot of money and you're comfortable and you don't have the headaches, it's like, it's, we'll call it complacency or content. You're content, you know. So if you want to scale your business, you can't be content. There will be you will not be content. That's. That's a fact. Um, and you're gonna have to run hard at it, you know, so that's, you know, that's. That's. That's what I say.
Chris
It's kind of interesting that, that you. Because you kind of came from this all upside mentality, right from where you come from, and then once you kind of got in there and got a little bit complacent, that. That. That fire in you kind of became a little more conservative, you know, And I think that that actually happens probably more than you might think. Like, you know, because you're right, man. You start to feel like, okay, I finally did something here. I got something good, and I want to. I don't want to. Don't want to mess it up.
Steve Holland
Yeah.
Chris
So.
Steve Holland
Well, and the other thing, with regard, you know, we did some acquisitions. I did an acquisition right before I sold my company. You know, I bought some. I bought a company for 40. This is a number of years ago. I bought a company for like, $45,000, sold off 20,000 in the assets, and started harvesting a quarter of a million, a quarter off of that business. I mean, then I bought another one just before I sold. I would have probably went after acquisitions a lot more. And I knew which. You know, here's what's so interesting about this. Everybody wanted the polished acquisition, and they wanted the company. I didn't want those. I went after the small mom and pop shops that had aged equipment like you wouldn't believe, because all they did was fix. They fixed, fix, fix. We go into this thing and we find a gold mine of aged equipment. That. And it's not that I say you should sell all your aged equipment off, but the homeowner is like, well, we never had this conversation. You know, we never knew there was later, you know, better stuff out there. They just kept fixing it. And I'll tell you, we harvested millions off of one one acquisition I did before I sold. So acquisitions would be something I'd really do. Brand. I'd brand, I'd become a brand. I'd definitely become a brand. It just. It changes everything. It changes. Your paid search percentages decrease. You could spend the same amount of money, but you yield greater results just because everybody knows who you are. I can tell you a story about that later if you want, but something I discovered.
Chris
Well, you guys don't like it, we're here.
Steve Holland
Oh, you want me to say it? So we got a phone number, right? It goes like this. 866-992-17. 17, right. That's a sub brand within our ads. But doing it 20 years, I go anywhere, people like, 17. 17. I hear it when I'm getting my hair cut, my teeth clean, you name it. So we were working with a company that did paid search and digital stuff, blah, blah, blah. And one of the, as you guys know, you're part of that industry tracking numbers. So your. Your digital presence, your paid search, you have phone numbers that are very, you know, specific to whatever you post out there. Well, what they were doing in our Google, with our Google listing is they changed it to a tracking number, and they took away from our regular number, and then they'd send us these reports and saying, oh, look at all the, you know, customers you got, blah, blah, blah. So I had one of my team members look into it, and we started looking into it. What we started to find out is that every single customer that they were sending or these links were not from that ad or any of the ads. They were organic. So now we're like, wait, we have all this organic positioning? What's going on here? So then we really started to dig into it, and here we find out that they were doing a direct search because they had heard us on the radio over and over and over. And then this company was getting credit for what we had already built organically. Now, they would come back and say, well, you know, and they'd give me. I said, look, I mean, we were still on good terms, but it was like, no. That organic positioning because of the brand only made our relationship stronger. It made Our paid search 10. I don't know if it's tenfold, but incredibly better. And here's how I know. When I sold my company. These guys own a bunch of companies, okay? They're trying to figure out, even to this day, why Mr. Hollins has the lowest percentage of marketing to revenue than all their other companies. Well, guess what? Because we've branded. We bought mental vacancy of the mind for 20 years. So. So when people go to Google or when they go to do a search, they just type in Mr. Hollins. Boom. And that's how they find us. So branding would be right out of the gate. It's. It's. It's. As you guys know, branding takes time and money. Time and money and patience. I almost quit. I almost quit my branding campaigns at seven or eight months into this. Nine months. I was going to quit because we weren't getting results. We're spending tens of thousands a month and no results. And then all of a sudden, the phone Started to blow up at about the eighth or ninth month. And Roy warned me. Tim Miles warned me, you got to be patient, Steve. You got to be patient. You do it the right way, it'll work. And it worked so well.
Chris
I will say as a marketing agency, you can clearly track the difference between those things, so that way you don't have to guess. But what you just said, I swear, I've heard that same thing so many times.
Steve Holland
Well, back. This was a while ago, too. Now. Now you can track all that, right?
Chris
Of course. Yeah. I'm just saying.
Steve Holland
I don't know. Did I answer your question the way you wanted it answered?
Chad
Yeah, no, that was clear.
Steve Holland
On that scaling thing. Yeah. Get the house in order before you try to scale. That's all I can say. So. So real quick on that. Jim Abrams taught me something. And this is one thing every contractor should know. You cannot sell your way out of problems in your business. So if you got cash flow problems, you got margin problems, don't go out and try to sell a whole bunch more stuff to try to fix that problem. Businesses do this every day. Fix the problem, then go out and sell a bunch of stuff. And that was a lesson he taught me down in Florida. One time, he sat me down in his office and he took my financials, and he started circling. He's like, steve, you got to fix this, this, this, and this. And I got an MBA lesson on financials that day for free from a guy that just said, call me anytime. You can come down and sit in my office and I'll work with you. And he did.
Chris
So I tried so hard to get Jim to come to Rhino X this past year, but he's not going anywhere. I mean, he. He did a podcast. He did a podcast with us. Oh, God, maybe it's been two years ago, and it was so freaking interesting. And he did his. I think I may have told you, Steve, he did, like, live on the spot when he would door knock. He did the whole pitch. Like, he remembered the whole pitch. And he did the whole pitch live on air when I asked him. It was so cool.
Steve Holland
Yeah, Foot canvassing. He was. He. He. He was big into foot canvassing. But remember, early 80s, you could get away with that. Today, you'll get shot. You know.
Chris
Hey, you talk about. And I'll be curious to see what your position is. I'm gonna pivot just a little bit. Talk about who you know for in business. In your business, who is the most expensive customer that you own?
Steve Holland
What.
Chris
What is who? Well, let me ask You, Steve, who is the most expensive customer that you own?
Steve Holland
Your most expensive customer, Your employees. And you know, all of them, and especially your grassroots guys that are out there hitting the pavement every day. But all of your employees, there's a huge shift that took place a number of years ago where, and you guys probably remember this, customers are first, you put your customers first, blah, blah, blah. And I agree, customers are absolutely right there. But we've seen a complete change in from generation to generate. My generation, we were the working generation. And I'm not picking on the people today and saying they're not, but we were just told, go out and work, keep your mouth shut, and that's it. And we did. We, we go out and do jobs that we hated. I remember digging trenches and I didn't like it, but I just kept my mouth shut. I never said a word because you just didn't do that coming out of Gen X, you know. But today it's a little different. So I just had this conversation. It's funny, you ask, and somebody asked me, steve, would you go into business again? And I said, I don't know. And I'm not going to say no. But if I did, he goes, what would you do different? I said, number one, my employees. I would get engaged with my employees like you've never seen as a business owner. I'd be engaged. I'd know their spouses names, I'd know their children's names. I would know every hobby they do, and I would be authentic and genuinely interested in their lives. Because if they're going to give up 40, 50, 60 hours a week for my business, the least I could do is understand who they are as a person and then, and then stand up for them and make sure that I'm doing everything in my business. And the same with my managers and my leaders that they're looking out for these installers and they're looking out for these service techs and these duct cleaners and these plumbers and these electricians that they're taken care of. Then. And here's, and here's, here's a simple equation, right? If you take care of your employees, and I mean beyond anything that we've seen, you honor them, you respect them, you take care of them, you're going to have a few deadbeats in there that you got to get out of the, get out of the pool, right? That's going to happen in any business environment. How are they going to show up at the home? What types of conversations are they going to have? About the company they work for when they're trying to sell somebody a $16,000 replacement system. Okay. And when they start to have conversations, well, somebody says, well, how is it working for Steve? And they say, in an authentic and genuine way. I love working for Steve. Steve takes care of me. Steve has been always there for us. He helps us out. He gives us all the resources we need. He makes sure. Makes sure that we have all the right tools, blah, blah, blah. And they start to have the conversation. The homeowner's not getting other quotes. They're already happy. So your employees take care of your employees. You know, I can't emphasize that enough. And this labor shortage thing, it's not going away. So you better start taking care of employees now, because if a guy like me comes into your market, I'll just take them. I'll just. I'll just start a business. I mean, I'm not saying I'm going to, but if I had that company, I would. I would just start figuring out a way to get those people, the good people.
Chad
Yeah.
Chris
You're leveraging the way that. Yeah. You treat them.
Chad
Yeah. I think it's such an important point is, you know, I think so many people get this whole, you know, culture is the buzzword, right? And it's, well, we got this and we got that. And at the end of the day, I'm a firm believer in exactly what you just said. It's not about all the frills and this, that, and the other. It's simply about taking the time to get to know your people and letting them know that beyond a shadow of a doubt. I want your success as much, or in some cases, even more than your people want it. I'm gonna do everything humanly possible to make sure that you are successful. Because at the end of the day, when you're successful, the company wins, too. And it's a lot, lot better if everybody wins, as opposed to, you know, me, big, big, bad business owner. I just win. And, you know, you guys just are the worker bees, and you guys do your thing. It's not like that. It takes everybody. You. You mentioned earlier, I can't work on a furnace, nor a water heater, nor an electrical panel. And so, you know, there are people that know how to do that, and they're very good at it, but they also can't do what they do without me. So we work in tandem together to, you know, pull off. What we try to do every day is take care of customers and make sure everybody gets home safely. But I just think that that's such an important point. And I feel like as you grow your business, I think it's easy to resign to. Well, that's not my job. Like, they've got a manager. I don't need to talk to them, whatever it may be. You know, that's not my responsibility anymore. And I couldn't. I don't think that could be further from the truth in that you, as the leader of your business, are the barometer of where the company is going to go. So how you treat people, how you interact with people, your energy level, all of these things are what dictate your culture. And you're in charge of that. You get it dictated every day. How you show up at the office, are going to yell at people and scream and, you know, do all of this, or are you going to say, hey, man, how was your weekend? What can I do to help? Where are you struggling? Let's give you some resources. And I just think that's so important. So I appreciate you saying that.
Steve Holland
Yeah. And it's funny you say that, because I've been all of the above. You know, the truth is, I made every single mistake in business there was, with the exception of two. I never missed a payroll and I never missed a tax payment. But, I mean, I've mistreated some of my employees. I've been the guy that's gotten rid of people I should have never got rid of.
Chris
I've.
Steve Holland
I've. I've hired people I should have never kept, people I never, you know, I should have never kept. But, you know, that's what comes. That's what's cool about this, is, you know, when you're in business a long time, you gain some scars, you gain a little resilience, but you also gain a lot of wisdom. And, you know, I grew up never being treated well, so I didn't know how to treat people. That's why I joined Airtime 500. Because I didn't know how. Well, not because I didn't know how to treat people. I didn't know how to run a business. I was growing my business when I first started, and I didn't know how to run a business. I didn't know a financial statement. So I joined Airtime 500 as kind of this mentorship organization, and it was the best thing I ever did. Yeah, it cost me a bunch of money, but so what? I made it all back, plus some. So I, you know, I think our employees today, they're just not. And I'll tell I'll just say it. I'm not going to sugarcoat nothing. Private equity, they got this all wrong. Not all of them. Not all of them. But you talk to. You talk to individuals that work for private equity companies, and they'll say, I don't even know who the owners are. Never met them. It's like, no, you got. These people got to get engaged. You can't just fly into town, take them golfing for an afternoon and expect that to be a culture booster. Okay? That's where private guys like you, man, you have. Not private equity, but private ownership, private companies. You guys have it way easier to get engaged with your employees. You know, I had one employee at my company one time. It was his metrics were struggling, his numbers, and we tracked everything. You know, metrics. We could go into a whole nother podcast about metrics, but we tracked everything, and his numbers weren't doing well. So what would. A lot of. Most managers would sit him down and, hey, we got to work on these numbers. I didn't. First thing I said is, tell me what's going on. Is there something going on outside of work that I need to know about? Because if there is, we'll back off a little bit. We're going to give you some breathing room, and we're going to help you through this. Come to find out, he's getting divorced. We could have crammed numbers on him and throwing spreadsheets at him and talked about, hey, you got to get these numbers improved. Your truck rolls not as good, blah, blah, blah here. The guy's emotionally disconnected from work. So what did I do? As a business owner, I said, look, you take whatever time you need. If you need a day off a week, two days off a week, paid, paid, just take it. You can make it up later, we can deal with it later, but just take it if that's what you need. He didn't need that. We'll back off on your metrics. Don't worry about your metrics for the next couple of months. Just come to work, do what you can to stay distracted, stay happy, pay your bills, whatever you got to do. Later on, he come to me and he said, steve, that's one of the greatest things that. I never had an employer do that for me. And just because I took 10 seconds to seek first to understand before I would be understood, you know, I needed to understand his situation before I could start cramming, you know, reprimands on him over. Over his metrics. So that's. That's. That's huge. And I think that's going to be a game changer. The culture side of things is going to be a game changer here in the next couple of years.
Chris
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Chad
Yeah, you're 100, right? Yeah, yeah. I mean we were, I was at a com the service Titan conference in New York last week and you know, a lot of private equity guys are there and different stuff like that. And we were on a panel with a couple of us that are still private and, and one of the questions from the audience was from a private equity guy was, you know, like what are we missing? Like what, what, what do you guys see that we're missing? And I think resoundingly from the four of us up there, it was, this is a people business. Like you can't run these companies from a damn spreadsheet. Like it, it doesn't tell the whole story. And the minute that you think you're just going to pluck someone out, put someone in and everything's going to be perfectly fine is the biggest mistake that you could make. Because it, the these, these field professionals, they work at a certain place, they can go get $5 more an hour tomorrow. They could go get it this afternoon and it's almost 4:00. They could go get it this afternoon and be started tomorrow. But they don't. Because of the culture that you've built and the care and compassion that you show your people. They want to make you proud, not some other guy.
Steve Holland
Yeah, you know, it's interesting you say that, Chad. One of the things that we're discovering is that those that leave, if the culture is better, they're good. They're probably not leaving that company. So you think about it. Once the private guys that are not only providing a little healthier, positive culture, they're stealing employees from these organizations that are so spreadsheet driven. And I've seen these roll ups before. This isn't my first time seeing this. And one of the things that when I sold my company, I sat these suit and tie guys down at my, at my conference table. I said, what are you going to do different? Well, you know, Steve, blah, blah, blah. And they have their answers. I said, okay, don't screw it up. I said, we built a company. These people are like family to me. These, these, these employees are like family to me. And I just don't want to see this thing screwed up. Oh, no, no, we wouldn't do that. And I'm not saying they are. But I always hear about growth. So funny they talk about growth. Raising your prices considerably is not growth. I had to have this conversation with another company because they raise their price and they think they're growing. That's not growth. Now if you're not priced right in the first place, I get it. There is a little bit of growth there. I want to know how many new customers you have. New customers. I want to know how many new service agreements you've sold. Then let's talk about your top line growth. Because anybody can go in and take a business that's not priced properly, raise their prices, call it growth. But yet net loss on the number of customers you have. I'm seeing this all over. This isn't just happening in private equity. It's happening in a lot of these bigger roll ups where, where that's what they're doing. So we'll see where this comes out. I don't know where it's going to be in a couple of years, but I'll tell you what, those employees, if you have a business today and you're watching this, take care of them. If you got to sacrifice some net profit to keep your employees happy, genuine, authentic, not this phony nonsense. You got to be genuine and authentic with them. And if you're not a genuine and authentic person, find one of your partners that's in your business, that is, or a manager and make things happen. You know, Mr. Hollins, we had a thing called Culture Club. I took two people, I made them Culture Club ambassadors. I said, here's some money Throw it at the employees and do fun things with them, you know, that was Chad's.
Chris
Favorite band, Culture Club.
Steve Holland
But anyway, we could go. Like, I'm telling you, man, this is hot stuff to talk about because there's. There's a thing called Roy. Roy always used to say, you can't read the label if you're inside the bottle. Have you ever heard him say that?
Chris
Nope.
Steve Holland
Okay. So if you're inside the bottle, you can't read the label, or you get caught up in what I used to. My metaphor was the hamster wheel of life or the hamster wheel of business. So, you know, like, guy like you, Chad, you go into work every day, you do your thing, and you're caught up. You've got. You've got your schedule, you've got your things going on, and you're caught up in this. Right? Nothing wrong with that. That's part of your role. But what happens for most business owners, they get caught up in that hamster wheel of business, and they never take two steps back to take a different view of it, to see a different view. And that's where some of the culture problems come, because I know I did it. I was so caught up in my business, I'd sometimes forget about some of my employees, just to even take 10 minutes to go and engage them in a nice way. How you doing? How are things going? How's life treating you? What are you working on at home? That's exciting, you know, what are you working on outside of work? That's exciting. And they would open up, and. I don't know, that kind of stuff just kind of hits. Hits. Hits me in a heart. You know, I. I love the tax and the plumbers, and I like to see these guys be. Be taken care of. So, anyway, we can go on and on about that, but I think we hit it home.
Chris
I think so. You know, it's. It is interesting how much this continues to come to. Like, to come up over and over and over and over again. And. And one thing you had said, like we talked about earlier, Steve, was, you know, how you can use that to compete against some of the big boys and these markets, too. Right. Like, is the volume of talent that is coming from the lack of culture. And the new partnership has kind of changed the recruiting game a little bit.
Steve Holland
Absolutely. People ask me, when I first started my business, I get asked. I was asked many times. I used to go around and tour, and I'd go and speak at different schools. And, you know, when I started my company, it was Me in a truck, right? And I had all these competitors. And I'm going to tell you the secret formula. I outworked every one of them. That's all I did. They didn't want to run sales calls on Saturdays. I ran sales calls on Saturdays. They didn't want to run sales calls at 7pm at night. I ran sales calls at 7pm at night. And we'd laugh at that today. Like, Chad, you got comfort advisors out there, comfort engineers out there. They're working seven at night Saturdays. We would laugh at that today. But there was a time where, nope. If you wanted to book an appointment for a replacement plumbing or replacement H vac or H vac, you would end up with, you know, a 2:00 in the afternoon appointment where I'm like, no, I'll go anytime. So all I did was just outwork the competition. So when we look at private equity today, all you private guys out there, your, your mom and pop shops, just outwork them out, work them out, culture them, and you'll, you'll do just fine. You will do just fine. And be relational with your customers. You know, be relational. I mean, you still got to do good work, right? You still got to be skilled. You still have to have, you know, you got to put your money where your mouth is. You got to back up your work. Right. You got to have some guarantees, warranties, all that business. But, but, but just outwork your competitors and you're going to be just fine.
Chris
Good way to compete with the big boys. Yep, yep. Because you can control your own output, right?
Steve Holland
Absolutely.
Chris
That's right. And you can control your own culture as long as you're, you know, being, like you said, authentic and, you know, and being intentional. Yeah, well, I mean, listen, it's a, it's, it's still a absolute dog fight out there right now in the market. Right. And, and I think some of that stuff still rings true. Like, I don't know how Chad could put, could possibly know every single, you know, spouse and kids for his. I don't know how many hundreds of employees he has. But, but that's another thing you have to think about is, well, how do you figure that part out? Well, it has to come from leadership. There has to be some leadership that's, you know, doing the same thing that, that knows to do, you know, to follow that similar cadence.
Steve Holland
So, sure, companies like Chads, you just, you empower managers, you know, you do breakout sessions where maybe Chad meets with a group of 25 once a month and splits it up Stuff like that. There's ways to work around it. And then you just become contagious with your positive, your positive attitude. It becomes contagious amongst your leaders and managers and then they just spread that. It's not difficult to do. Matter of fact, I think in a large company might even be easier to do. I'd have to test it, but I think, I think it would be, it's just having the right people with the right minds and you know, having compassion for, for, for what you're doing. I mean, that's another thing. What we're seeing, we're seeing on the private equity side is the passion's gone. Like employees are just coming to work because it's a job and then they're just paying them really high wages. So now they're held hostage, they can't leave. And, and that's what I'm witnessing. And it's like, but they hate it. They're not happy. So at some point that'll break. It's gonna break. It's not gonna last forever, I can promise you that.
Chris
Yep. I mean. And now. So I'm gonna shift gears for just a second. Steve, you mentioned you kind of slipped it in there earlier, but, but I don't know if everybody caught it, but you're talking about how you're kind of doing some coaching stuff with some companies now, right? Like some one off stuff. I'm not sure like if you're, if you're taking on more people or not, but is that something where, like, if anybody wanted to connect with you on this, like, are you open to doing that? I don't mean to put you on the spot, man, but like just, you heard, I heard you mention it and I couldn't remember if you said that you were currently, you know, able to work with anybody else or, or if anything else, if they're just, you know, if our listeners are able to just, you know, reach out to you and connect and ask any questions themselves, is that something you'd be okay with?
Steve Holland
Yeah, absolutely. I mean, I do have, I do have a client. It's a private equity client, so I do radio for them. If you come to Milwaukee, you'll hear me on most of the stations. But as far as helping others, yeah, absolutely. I mean, heck, even, you know, phone calls and they need a little help. I don't have a problem with that. I do have a few consulting clients I'm not here to. I don't have a business I'm pitching. It's just me. I have gone out and Helped businesses and. Yeah, absolutely. And in a couple of years, I might. I might want to do more of this or even this year. I don't know. I really don't know. It's, it's. It's one of those things where whatever happens, happens. But absolutely. Share my information. If somebody wants to get ahold of me, they're welcome to get ahold of me. And if I can help them, I. I will. If I can't, and if I don't know the answers, I'm one of those guys, too. If I don't know the answer, I'm just going to tell you I don't know the answer. But I probably know somebody that does know the answer.
Chris
That's fair. Well, I mean, I just thought that it was, you know, I know you weren't pitching anything because I'm the one that brought the whole thing up. I was just hoping I didn't overstep, but seems like you're the kind of guy who would be open to, you know, to being helpful. And you know what it would have been interesting is, you know, we're like, right. Butting right up against the, you know, about trying to, you know, finish this thing, this particular episode off. But another thing that would have been interested if. I wish I would have asked it when I was thinking about it was and going back to your jingle. So we may have to do. We might have to follow up on this one and figure it out. But I'd love to go back and listen to some of the. Some of the radio stuff that you had done that was successful just to kind of hear what some of that crazy stuff was that you're talking about. So. Because if you went down that path right now, we would be another 20 minutes in and that would be late for my executive meeting you had to go to in like five minutes.
Steve Holland
That's okay. But I'll email you. I'll email you some of the ads that we've done, so. So you can listen to them and feel free to share them. Please don't copy them. I'll get in a lot of trouble if you copy them or somebody not you, I'm not worried about you, but out into the airwaves and somebody copies it. I'll get some phone calls. So whatever. Anybody that hears my jing or it's not jingles but radio ads, please do not copy them.
Chris
That's fair. I think that's. I think that's. I think I feel like that goes without saying, but maybe, maybe it doesn't. So I'M glad we said no.
Steve Holland
You have to tell because I've had situations where, yeah, somebody else send me a, a message and say, hey, I just heard your ad in, you know, over in Nebraska or not Nebraska, but that one, I was one of my clients, but like in Indiana or somewhere, I'd be like, yeah, I heard one of your ads. And it's like, oh, they can't do that. So I just give them a friendly call. Please don't do that, guys.
Chris
Well, listen, man, we really appreciate you giving us the time, you know, to come in, you know, and just share some of your history and a little bit of your knowledge with our listeners. So I appreciate you, Steve, coming on here.
Steve Holland
Yeah, thank you. And thank both of you. And I'm. Yeah, maybe we do this again someday down the road and we just stick to a couple subjects because I'm. Like I said, I get on a tangent. So. But thank, thanks again. I appreciate it. I'll shoot you an email and we'll go from there.
Chris
Wonderful. And to our little. I appreciate that, Steve. And then, you know, to our listeners, you know, he open invitation, man, reach out. We'll make sure to share his contact information, know, in the show notes and things like that. And again, you know, we talk about a lot of different things. You don't got to do everything, but you got to do something. No. Zero days.
Podcast: To The Point - Home Services Podcast
Host: Chris & Chad
Guest: Steve Holland, Founder of Mr. Holland's Heating Air and Electric
Release Date: March 18, 2025
The episode kicks off with an introduction of Steve Holland, the founder of Mr. Holland's Heating Air and Electric. Chris highlights Steve's journey from starting his business in 1990 to successfully exiting in June 2021 with a company valued between $10 to $12 million. The hosts express excitement about Steve’s wealth of experience and insights, setting the stage for an engaging discussion.
Steve opens up about his challenging upbringing in West Bend, Wisconsin, a small city predominantly focused on farming. Growing up amidst family dysfunction and instability, he shares, "I lived in 15 different homes over a 16-year period" (00:55). Despite these hardships, Steve found his calling in the trades after working at Gail Co., where he built farm equipment. A pivotal moment came when a friend's father encouraged him to pursue a career in the trades, leading Steve to become a helper in HVAC—a decision that would shape his future.
Notable Quote:
"When I quit my job and got into the trades, I had no idea what a condenser from a furnace was. But over time, it turned out to be the best decision I ever made." (06:00)
In 1997, Steve took a significant risk by purchasing Earl Empkey’s HVAC business for $10,000—a challenging feat given his financial constraints and a growing family. Despite initial skepticism from his wife, Steve persevered, working tirelessly—seven days a week—for seven years to build the company. By 2021, the business had grown exponentially, achieving a $10-12 million run rate annually.
Steve recounts the early days with vivid anecdotes:
"In my first week, I was outside drilling with a right-angle drill, and it knocked me out cold. Weeks later, I was sweating in a 90-degree attic installing a UNICO system. I questioned my decision, but sticking with the trades paid off." (09:30)
A significant portion of the conversation centers on the critical role of employee engagement in business success. Steve emphasizes that employees are the most valuable customers a business owns. He states,
"If you take care of your employees, you honor them, respect them, and genuinely engage with their lives, they become advocates for your company. They'll say, 'I love working for Steve; he takes care of us,' which directly influences customer satisfaction and loyalty." (32:47)
Steve reflects on his own practices:
"I made every single mistake in business except missing a payroll or a tax payment. Learning from these mistakes, I prioritized getting to know my employees personally—knowing their spouses' names, hobbies, and being there for them during tough times." (38:02)
Steve shares his strategies for scaling the business and the pivotal role of branding. He recounts collaborating with Roy Williams, the "Wizard of Ads," to craft memorable radio advertisements that built strong brand recognition.
"Branding takes time, money, and patience. At nine months in, we almost quit our branding campaigns, but perseverance paid off as our phone started blowing up. Roy advised me to stay patient, and it worked brilliantly." (30:39)
Furthermore, Steve discusses his approach to scaling through strategic acquisitions, targeting small mom-and-pop shops with outdated equipment. This move not only expanded his service offerings but also allowed him to harvest significant value by upgrading and improving existing systems.
Notable Quote:
"You cannot sell your way out of problems. If you have cash flow or margin issues, fix those first before trying to scale your sales." (31:01)
When asked what he would do differently if starting over, Steve emphasizes the importance of operational soundness before scaling.
"Ensure your business is operationally sound—proper pricing, healthy margins, and resolving inefficiencies. Scaling a problematic business merely compounds existing issues." (22:14)
Steve also touches on the pitfalls of private equity in the trades industry, warning against approaches that neglect employee well-being:
"Private equity firms often fail to engage authentically with employees. A positive, compassionate culture retains talent far more effectively than merely offering high wages." (35:54)
Towards the end of the episode, Chris inquires about Steve’s current ventures. Steve confirms he's open to providing consulting and mentorship to other businesses, highlighting his ongoing commitment to helping others succeed:
"I’ve helped several businesses through Airtime 500. If you need assistance, reach out, and I’ll do my best to help or connect you with someone who can." (51:59)
The episode wraps up with mutual appreciation between Steve and the hosts. Chris encourages listeners to connect with Steve for further insights, while Steve emphasizes the importance of genuine employee engagement and strategic branding as cornerstones for outworking, outbranding, and out-culturing the competition.
Final Takeaway:
Building a successful home services business hinges not just on hard work but significantly on fostering a positive, engaged workplace culture and investing in strong, patient branding strategies. Steve Holland’s journey serves as a testament to these principles, offering valuable lessons for entrepreneurs aiming to scale effectively and sustainably.
Notable Quotes with Timestamps:
Connect with Steve Holland:
For listeners interested in consulting or learning more about Steve Holland's strategies, his contact information is available in the show notes. Don't hesitate to reach out and leverage his extensive experience to grow your home services business.
Disclaimer: The transcript provided was partial, and the summary reflects the content available up to timestamp [54:46]. For a comprehensive understanding, listening to the full episode is recommended.