Buying a Business Doesn't Mean You Can Run It

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I think the vast majority of people when it comes to ownership should be passive investors.
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They should not be operators.
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And I think I believe in ownership.
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I do not believe that most people or everyone should be an owner.
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This stuff I feel like is sold on social media as an easy way to be a business owner.
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And I mean, even if you're a sophisticated company with sophisticated people and a great management team, I still look at bringing a company in is incredibly difficult.
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Q4 across the organization, it was like 120% revenue from one year to the next just by focusing on it.
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And it was like, it was like in absolute numbers, like 8 million to 16 million for that quarter.
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And that's always been our worst quarter.
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Interesting study from Harvard, 30%.
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There's a 30% pop in successful exits if you're a partnership, which is kind of similar to data you said.
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It's a very meaningful difference to actually selling a company in the future, having a partner.
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actually ever even getting to the chance to exit your business.
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It's 30% higher if you're a partnership.
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It's not that you need to be healthy to have a good business or be a good leader.
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It's just that the ingredients of good health are also really good ingredients that go into becoming a great leader.
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I do want to leave people with that.
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Like I would challenge your idea that there's a day coming in the future where you'll do something different than what you're doing now.
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You got to do it now.
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Welcome back, everybody.
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Good to see you.
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So kicking it off with what I think is now our standard protocol.
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We volley questions at each other.
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So I've got 10 to volley at Mike today, and we don't show each other the questions in advance.
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And so Mike, today I'm throwing a bunch of financial but non-business.
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They're like kind of business related, but more financial related questions at you than business questions.
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And so the...
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I thought for sure you were going to go the hot take route and try to get me in trouble with politics or something like that.
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The hot take is on my agenda.
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I was just taking a break from it, but it's coming back.
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Because everyone was like, those were very lukewarm hot takes.
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Yeah.
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I thought JP would come back hot swinging after the vacation.
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Coming back, but just not this week.
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And I have actually been thinking about a few of my hot take ones.
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So it's definitely on my mind.
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They are coming.
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You have less to lose now.
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You have no customers.
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That's right.
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That's right.
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What are you going to take from me?
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Exactly.
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I doubt my city turf clients are listening to this.
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So I'm not a super controversial guy.
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I just keep my mouth shut.
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So, you know, it is a stretch, even if I don't have customers to lose, to go out too far on a limb.
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I'm totally good having the conversations one-on-one.
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I just don't have them in public.
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So, all right.
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So on this one, the way you're going to think about it's kind of, I love the betting exercise.
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Okay.
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Even though I don't think either one of us give a flip about betting.
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But I love that mindset because I think that's half the problem with opinions in the world is everybody just has an opinion.
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But if they had to put money on their opinion, they'd have very different opinions.
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Yeah.
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And so the idea here, the framing is you have to put $10,000 on this.
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You have to be willing to lose 10,000 bucks.
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And I know you're not really, but you know, it's like kind of think about that was like, Ooh, boy, am I really confident enough to gamble 10,000 on each of these questions?
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Okay.
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All right.
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All right.
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And so I...
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I can answer any of these if you are curious.
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I don't know if I should tell you if I disagree or not.
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I mean, I obviously have the advantage to think about it a little bit, whereas you don't.
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You might change your mind later.
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But I think these questions are interesting.
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I don't necessarily think they're easy.
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So we'll see what you say.
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All right.
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Starting at the top, the S&P 500, okay, so you're basically saying, yes, I would put $10,000 on that.
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Or no, I would bet against it.
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So you're betting in agreement.
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That's the way to frame this.
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And of course, ask me questions if you need to.
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Okay.
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So will the S&P 500 be double what it is today in 10 years?
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Oh.
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So that'd be a seven.
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Yes.
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Okay, I agreed with you.
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I'll say if I agree to disagree.
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Okay, yeah, that's good.
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I like that.
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I think it's interesting.
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So I agreed with you.
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But again, for everybody watching, I have a massive advantage.
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I get to think about it.
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Mike's never heard this before.
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Okay, so will the US dollar lose its reserve currency status within 25 years?
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What percent?
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Because right now it's like 90%.
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Oh, I was like, I would guess above 50%.
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I was like, I guess maybe above 50% defines it as the world currency.
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I don't know.
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World reserve currency.
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I don't know how you, I don't know how you would actually, I'd have to give that one some thought.
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Yeah.
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Did you say in five or 10 years?
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Oh, no, no.
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I said 25.
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Oh, 25 years.
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Yeah.
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Oh.
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Yeah.
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Five years is an easy no, in my opinion.
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Yeah.
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Yeah.
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Oh, the challenge is not whether or not it loses 50%.
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It's like, what replaces it is the tough part.
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Agreed.
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That's why I love these questions.
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It gives you an idea of how, you know, everybody, you think.
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Yeah, because everyone likes to bag on the US dollar, but it's like, well, what's going to replace it then?
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Bitcoin?
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Gold?
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I agree with you.
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Yen?
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Yeah, exactly.
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Oh, 50%.
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I'll take that it's still in 25 years is above 50% of use.
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Me too.
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Yeah.
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Okay.
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Really?
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Okay.
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I don't believe we're going to lose it in 25 years.
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Okay.
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But not an easy question.
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Yeah.
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No, it definitely is like one of those things where it's like, okay, how old are you kind of starts to matter?
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Because like when you're 75, if you're losing, you know, the currency status, you're going to change your investing strategy.
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But in 25 years-
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And you better have changed it way in advance.
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You can't change it when it happens.
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You have to be way ahead of the curve or you're screwed.
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Yeah.
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All right.
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All right.
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Number three, I got 10 for you.
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Okay.
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The average American life expectancy will exceed 100 years within five years.
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I'm sorry, 50 years.
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Oh.
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So within 50 years.
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Yes.
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So an average.
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Oof.
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Oof.
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like are we talking life expectancy or like um average life expectancy right now it's what 73 74 somewhere along those lines and i think maybe dropping a bit for americans which is sad oh 50 years oh average though is tough that means people are living 120
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No, it's not going.
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Not 100.
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I went no as well.
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Oh, man.
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I had to think of it.
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That one wasn't.
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That was, I mean, I created these questions.
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Okay, I have a question.
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Did you run these questions through AI?
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Did you like it?
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I did afterwards.
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Let's go.
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I did.
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But I, so I made myself answer them all first.
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Yeah, and then you ran it through.
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Okay.
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And then I ran them through.
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Did you change any of your answers after?
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Yeah.
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No, and 100% match.
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Wow, let's go.
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Yeah, I mean, I don't know what that means.
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Maybe AI is really, really stupid.
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It used to be chat JPT, let's go.
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Yeah, yeah.
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No, so I used Claude and I said, I want you to do, like, I always use the word deep research again.
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Yeah.
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What's that mean?
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Based on everything you can do to research each of these questions, I want you to give me your very best guess.
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Yeah.
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100% match with what I said.
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I don't know what that means.
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So, so far you're...
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Confirmation biases.
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Let's go.
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Exactly.
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But so far you're matching up with Claude as well.
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So far we're as smart as Claude.
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Okay.
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So, all right.
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You know, on that one, number three there, I did...
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I did think, you know, if I were to reframe that as would the top say 1%, then I would think I'd switch my answer to yes.
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Yeah, or like what percent of people get above 100 years old?
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I think that's going to make a big jump.
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But averages take a lot to move that needle.
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Yep.
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So, and I did, when I write these questions, I wrote down a bunch of ideas and then I dumped them into chat GPT and had to help me reword them.
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So I did do that.
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So I don't remember in the original version of my question if I said average, but by the time I got it back and it said average, like I was a no with you.
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Hey, if you lived to a hundred, we still have like a lot of years of podcasts left to go.
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We do.
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I think we're going to run out of this.
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We're going to have to find a new way to start the show.
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Or by that time, we will be very controversial.
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That's right.
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All right.
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Number four, marriage rates will continue to decline until fewer than 40% of Americans get married in 20 years.
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I would take the bet that that is going to happen.
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That's what I did too.
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I think there's a, I think there's a, and this is probably top of mind because some of the podcasts and things I listen to, it's like the data's pretty crummy on young guys these days.
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Yeah, that's a controversial take.
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We need to drill down on that one.
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In the comments below, if you want us to talk about the crummy nature of young men in America, let us know.
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Hey, while we're on it, what podcast specifically, when you thought about that, what podcast are you listening to?
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Some of them are tech podcasts.
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So I've heard it.
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I've heard Rogan talk about it.
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There's a number of tech podcasts that I listen to, like Pierre Diamandis.
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I know I've heard him talk about it.
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I've heard Scott Galloway talk about it.
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So just a variety of different... Those are three that come to mind, but I've heard it quite a bit.
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And I'm kind of aware of it because I know a lot of parents that are all...
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thinking about their kids these days yeah more and more i think the girls are more put together than the boys i mean that's what i feel like i see and even just like the education rates in university too so okay everyone needs to comment below if you want us to do a whole episode on non-business stuff and the socioeconomic collapse of the young man in america pull our scott scott galloway hats on just exactly all right number five
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A four-day work week will be the standard for most Americans within 15 years.
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For a W-2, yes.
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Okay.
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I think there's going to be a lot of like 1099 stuff for a day or two a week kind of thing.
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On top of the four-day week.
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Oh, that's an interesting take.
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I didn't think.
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So I went no on this one.
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I think we're still going to be working.
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Five days a week.
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It just may.
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Yeah, I think so.
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I mean, who knows?
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Like, we're just guessing here.
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Yeah.
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But I think people will be less and less efficient.
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Like...
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Yeah, they're at work, but they're working.
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But what's that really mean?
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But that's an interesting take that I didn't think about that way.
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It's like we could be splitting our time between a few things.
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Yeah.
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Okay.
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Number six, self-driving vehicles will eliminate the need for most service company drivers within 15 years.
249
00:10:22.141 --> 00:10:24.262
So you're a guy in a truck.
250
00:10:24.623 --> 00:10:24.863
Yeah.
251
00:10:25.063 --> 00:10:30.567
the self-driverless truck could take him to his jobs within 15 years and stay.
252
00:10:30.607 --> 00:10:31.888
I used the word standard meeting.
253
00:10:31.908 --> 00:10:37.833
Let's call it above 70% could be of the job camp above 70% of the time.
254
00:10:37.893 --> 00:10:41.315
A truck could be driving somebody to the job to do the work.
255
00:10:41.615 --> 00:10:42.896
15 years, man.
256
00:10:43.217 --> 00:10:45.018
I don't think it's going to be a lack of technology.
257
00:10:45.038 --> 00:10:46.159
It's going to be regulation.
258
00:10:46.659 --> 00:10:48.441
Like I still feel like that person's going to work.
259
00:10:48.501 --> 00:10:50.542
Someone's going to require a driver's license.
260
00:10:50.582 --> 00:10:52.744
Oh, but man, robotaxis are not doing that.
261
00:10:53.024 --> 00:10:53.464
I'm going to go.
262
00:10:53.644 --> 00:10:53.985
Yes.
263
00:10:54.005 --> 00:10:54.085
Yes.
264
00:10:54.485 --> 00:10:55.286
Okay, I went no.
265
00:10:55.406 --> 00:10:56.467
That was a hard one too.
266
00:10:56.487 --> 00:10:57.167
Yeah, I went no.
267
00:10:57.227 --> 00:11:01.711
I just, I do believe in this argument that we're like, there's a lot of exponentials happening right now.
268
00:11:02.311 --> 00:11:09.757
And so we kind of look at the past and we look at how long the tech has taken to develop and we project out and say, well, it won't happen in 15 years.
269
00:11:09.817 --> 00:11:13.881
I think we're at risk of being wrong on this stuff, but I went ahead and said no on this one.
270
00:11:14.021 --> 00:11:15.002
Okay.
271
00:11:15.582 --> 00:11:22.828
To your point too, it's like, I think the tech could be there in a lot of places, but will society really go for it?
272
00:11:23.068 --> 00:11:24.629
15 years is a long time.
273
00:11:24.709 --> 00:11:26.030
It is a long time though.
274
00:11:26.190 --> 00:11:27.211
It is a long time.
275
00:11:27.231 --> 00:11:30.212
You have to realize that's half of my life, bro.
276
00:11:31.273 --> 00:11:31.513
Yeah.
277
00:11:31.553 --> 00:11:35.356
I mean, 15 years ago, see what was 15 years ago for me.
278
00:11:35.376 --> 00:11:36.797
You were just starting service autopilot.
279
00:11:37.177 --> 00:11:40.559
I just started service autopilot and CityTurf was doing a million bucks.
280
00:11:40.977 --> 00:11:47.199
So if AI has popped its rear and its little ugly head in that fast 15 years, what's going to happen the next 15 years?
281
00:11:47.479 --> 00:11:49.400
I might take that one back, but I went with no.
282
00:11:49.620 --> 00:11:51.341
I got to stay with it because I went with no.
283
00:11:51.381 --> 00:11:54.002
But I think that one, I'm wavering.
284
00:11:54.102 --> 00:11:57.523
I think at first the legislation, that was my first apprehension.
285
00:11:57.863 --> 00:12:05.166
But when you look at Waymos or you look at robo taxis, even the Waymos, it's not required that you have a driver's license if you're in the vehicle.
286
00:12:05.186 --> 00:12:10.048
I feel like that would be an opportunity is where can you get driverless vehicles, but then have a non-driver?
287
00:12:10.608 --> 00:12:11.649
It would be huge.
288
00:12:11.909 --> 00:12:12.550
It would be huge.
289
00:12:12.850 --> 00:12:13.050
Yeah.
290
00:12:13.351 --> 00:12:13.551
All right.
291
00:12:13.851 --> 00:12:14.071
Wow.
292
00:12:14.111 --> 00:12:14.812
We are going slow.
293
00:12:14.852 --> 00:12:23.620
Number seven, within five years, will AI be better at diagnosing home repair problems than the average field technician?
294
00:12:23.940 --> 00:12:24.060
Ooh.
295
00:12:24.400 --> 00:12:24.981
What service?
296
00:12:25.041 --> 00:12:27.143
Can you give me an example or just in broad terms?
297
00:12:27.683 --> 00:12:30.085
I was imagining broad on this one.
298
00:12:30.105 --> 00:12:39.070
So I was imagining broad, but I was picturing like fertilization, weed control problems, like bear spots or disease issues or issues with your bushes.
299
00:12:39.110 --> 00:12:40.571
I definitely did a bunch of that.
300
00:12:40.611 --> 00:12:44.613
But I was also thinking even, you know, HVAC and plumbing type stuff.
301
00:12:45.554 --> 00:12:48.735
I think if the technician is tech enabled, no.
302
00:12:49.256 --> 00:12:56.560
But if you just are taking a raw employee, entry level, not a lot of experience, I think the AI will definitely laugh at them.
303
00:12:56.867 --> 00:12:57.127
Okay.
304
00:12:57.427 --> 00:12:58.167
I went with yes.
305
00:12:58.507 --> 00:12:58.887
Okay.
306
00:12:58.927 --> 00:13:01.108
But I will add one thing that I was picturing.
307
00:13:01.188 --> 00:13:03.829
It wasn't purely based on video or pictures.
308
00:13:03.869 --> 00:13:10.830
It could be just based on the tech describing the problem in detail to a model and then the model helping diagnose it.
309
00:13:11.030 --> 00:13:11.430
Got it.
310
00:13:11.710 --> 00:13:11.950
Okay.
311
00:13:11.970 --> 00:13:12.270
Don't know.
312
00:13:12.830 --> 00:13:13.031
Yeah.
313
00:13:13.051 --> 00:13:13.771
So I went yes there.
314
00:13:14.131 --> 00:13:19.852
I'm amazed at some of the stuff like where I take a picture of it and how accurate it diagnoses things.
315
00:13:19.872 --> 00:13:26.898
Yeah, we had this handyman come over to our house and put in a smart thermostat, and he threw the fuse in the HVAC system.
316
00:13:27.778 --> 00:13:34.904
And I was like, my goodness, I guarantee you, if I would have taken a picture of those things, put it on ChattyBeteen, just asked it how to do it, I probably could have figured that out.
317
00:13:35.344 --> 00:13:39.588
So, of course, that leads to an HVAC call for $300 for someone to show up.
318
00:13:39.848 --> 00:13:46.374
Yeah, I mean, I've had some stuff with like some car problems because I have a bunch of really rare cars.
319
00:13:47.094 --> 00:13:48.075
It figures it out.
320
00:13:48.456 --> 00:13:49.116
Yeah, well.
321
00:13:49.176 --> 00:13:50.818
It was just by talking to it.
322
00:13:50.878 --> 00:13:53.040
So that's why I included the talking to it element.
323
00:13:53.560 --> 00:13:54.681
We think about a lot of them.
324
00:13:54.801 --> 00:14:01.887
A lot of people, especially when it's very rare, they're actually going on like if you go back five years ago, they're going to Reddit.
325
00:14:01.907 --> 00:14:03.469
They're looking it up on Google.
326
00:14:03.809 --> 00:14:04.950
And now the AI does that.
327
00:14:05.551 --> 00:14:06.231
It does it for you.
328
00:14:06.271 --> 00:14:06.512
Yeah.
329
00:14:06.812 --> 00:14:07.613
All right.
330
00:14:07.713 --> 00:14:09.194
Number eight.
331
00:14:09.515 --> 00:14:17.683
Labor will remain the single biggest constraint for trade businesses for the next 15 years, regardless of what happens in technology.
332
00:14:17.763 --> 00:14:18.644
Constraint to growth?
333
00:14:19.065 --> 00:14:19.786
Just a bigot.
334
00:14:19.826 --> 00:14:20.026
Yeah.
335
00:14:20.066 --> 00:14:24.510
One of the biggest challenges in the business to solve continues to be the problem of getting people.
336
00:14:24.530 --> 00:14:25.191
15 years.
337
00:14:25.211 --> 00:14:25.652
15 years.
338
00:14:26.352 --> 00:14:28.433
Oh, yeah, these are so far out.
339
00:14:28.453 --> 00:14:29.133
They're really hard.
340
00:14:29.473 --> 00:14:32.734
I don't think it's going to get easier, but the constraint to growth, I will be.
341
00:14:33.034 --> 00:14:34.655
I do believe I was.
342
00:14:35.015 --> 00:14:35.295
Okay.
343
00:14:35.895 --> 00:14:37.796
I wasn't necessarily thinking constraint to growth.
344
00:14:37.936 --> 00:14:38.216
I was.
345
00:14:38.316 --> 00:14:39.416
But that is a good way.
346
00:14:39.556 --> 00:14:45.258
I just thought of it as I did say the word constraint when I wrote this, but I was imagining it's one of this.
347
00:14:45.598 --> 00:14:46.018
I should have.
348
00:14:46.238 --> 00:14:49.019
I was imagining biggest challenges inside the organization.
349
00:14:49.039 --> 00:14:49.219
Yeah.
350
00:14:49.359 --> 00:14:49.620
Yes.
351
00:14:50.000 --> 00:14:52.063
I still think it's going to be hard.
352
00:14:52.163 --> 00:14:52.504
Yeah.
353
00:14:52.724 --> 00:14:53.606
That's what I did too.
354
00:14:54.207 --> 00:14:54.387
Yeah.
355
00:14:54.687 --> 00:14:55.328
All right.
356
00:14:55.368 --> 00:15:02.719
Number nine, the U S national debt causes a genuine financial crisis, not a recession, a crisis within 20 years.
357
00:15:03.542 --> 00:15:05.004
Yes, I take that.
358
00:15:05.164 --> 00:15:05.344
Yeah.
359
00:15:05.684 --> 00:15:05.864
Yeah.
360
00:15:06.165 --> 00:15:06.805
Last one.
361
00:15:06.865 --> 00:15:15.554
But just to be clear, based upon our predictions, we believe that's going to happen, but it's not going to reset the U.S. dollar as the reserve currency of the world based on predictions.
362
00:15:16.435 --> 00:15:18.357
Yeah, I think that I can go with that.
363
00:15:18.377 --> 00:15:24.604
I think that alliance because I, you know, I like that analogy of the best house in a crummy neighborhood concept.
364
00:15:25.965 --> 00:15:30.328
So I suspect that if we have this, you see this happening across the world.
365
00:15:30.348 --> 00:15:33.129
I mean, China is not without a massive debt problem too.
366
00:15:33.249 --> 00:15:34.010
Oh, yeah.
367
00:15:34.050 --> 00:15:43.316
It's so easy for everybody to hate on China, but then also turn around the very same thought and say, well, the US sucks, but China's good at this.
368
00:15:43.336 --> 00:15:44.937
China's got all the same problems.
369
00:15:45.397 --> 00:15:46.818
And will anyone trust China?
370
00:15:47.659 --> 00:15:48.119
Exactly.
371
00:15:48.659 --> 00:15:49.300
Yeah.
372
00:15:49.620 --> 00:15:53.042
So I tend to think that it can happen, but it'll happen all over the world.
373
00:15:53.062 --> 00:15:53.463
I agree.
374
00:15:53.483 --> 00:15:53.663
Yeah.
375
00:15:54.203 --> 00:15:54.623
But who knows?
376
00:15:54.903 --> 00:15:56.143
Who knows?
377
00:15:56.163 --> 00:15:58.984
More like options like bricks probably popping their heads up.
378
00:15:59.284 --> 00:16:01.064
Yeah, but that hasn't gone well either.
379
00:16:01.265 --> 00:16:03.565
But even there's like more of them, like fragmented, I would say.
380
00:16:03.625 --> 00:16:04.545
Yeah, yeah.
381
00:16:04.565 --> 00:16:07.466
Like more options, even things like Bitcoin in some places.
382
00:16:07.486 --> 00:16:18.628
But I still think the percentage-wise moving, especially because so much of the demand and consumption happens in Europe and North America, just from a percentage perspective.
383
00:16:18.908 --> 00:16:19.488
So anyways.
384
00:16:19.789 --> 00:16:20.449
You said Bitcoin.
385
00:16:20.469 --> 00:16:21.689
Do you think about Bitcoin at all?
386
00:16:21.989 --> 00:16:22.449
Not a ton.
387
00:16:22.770 --> 00:16:24.151
No.
388
00:16:24.491 --> 00:16:27.253
Until I can go to the store and buy my groceries with Bitcoin.
389
00:16:27.833 --> 00:16:28.013
Yeah.
390
00:16:28.294 --> 00:16:28.614
I don't know.
391
00:16:29.174 --> 00:16:31.156
I had that as one of my questions for you, but I dropped it.
392
00:16:31.296 --> 00:16:31.616
Oh, really?
393
00:16:32.137 --> 00:16:33.237
Yeah.
394
00:16:34.178 --> 00:16:34.398
All right.
395
00:16:34.658 --> 00:16:35.159
Last one.
396
00:16:35.719 --> 00:16:42.324
The mental health problems or crisis in America gets significantly worse before it gets better?
397
00:16:42.344 --> 00:16:42.644
Yes.
398
00:16:42.664 --> 00:16:43.565
Would you say yes or no?
399
00:16:43.625 --> 00:16:44.005
Oh, yeah.
400
00:16:44.025 --> 00:16:44.486
100%.
401
00:16:44.646 --> 00:16:45.006
I do, too.
402
00:16:45.026 --> 00:16:46.007
I think it's going to get a lot worse.
403
00:16:46.167 --> 00:16:46.267
Yeah.
404
00:16:46.287 --> 00:16:46.387
Yeah.
405
00:16:46.627 --> 00:16:46.907
All right.
406
00:16:47.147 --> 00:16:47.387
Okay.
407
00:16:47.607 --> 00:16:50.308
So we really ended on a low note there.
408
00:16:50.709 --> 00:16:51.269
We did.
409
00:16:51.309 --> 00:16:51.969
Mental health.
410
00:16:52.009 --> 00:16:53.490
We're all going down.
411
00:16:54.010 --> 00:16:55.510
Just bet against America.
412
00:16:55.871 --> 00:17:01.253
We're going down and we're all going to experience a financial disaster within 20 years.
413
00:17:01.373 --> 00:17:04.014
And young men are just absolutely screwed.
414
00:17:04.034 --> 00:17:05.594
They're done for.
415
00:17:05.674 --> 00:17:07.455
And nobody's going to get married anymore.
416
00:17:07.635 --> 00:17:08.355
Exactly.
417
00:17:09.276 --> 00:17:11.257
But I'm still an optimist.
418
00:17:12.617 --> 00:17:13.858
I'm still betting on America.
419
00:17:13.878 --> 00:17:14.538
Let's go.
420
00:17:15.699 --> 00:17:18.123
All right, so what are you working on this week?
421
00:17:18.163 --> 00:17:19.364
What do you got going on?
422
00:17:19.384 --> 00:17:20.666
Yes, two major things.
423
00:17:21.247 --> 00:17:22.569
We did start the events free factor.
424
00:17:22.589 --> 00:17:24.272
So it's June, July, and August, 90 days.
425
00:17:24.832 --> 00:17:29.479
The first part is like all events page, then it's the calendar and schedule, and then it's the dispatch board.
426
00:17:30.000 --> 00:17:31.441
Describe what events means.
427
00:17:31.461 --> 00:17:33.803
What's that mean inside your tech, your system?
428
00:17:34.303 --> 00:17:40.088
Anything with recurring visits, one-time jobs, to-dos, anything on the schedule.
429
00:17:40.248 --> 00:17:44.351
And so really the hairiest, biggest problem is recurring.
430
00:17:45.312 --> 00:17:45.492
Yeah.
431
00:17:45.752 --> 00:17:47.794
Because we allow for off seasons.
432
00:17:48.234 --> 00:17:52.117
So it will pause the events for a period of time.
433
00:17:52.838 --> 00:17:55.159
And so, yeah, it's been a mess.
434
00:17:55.259 --> 00:17:58.100
We decided 90 days we're going to go in guns a-blazing.
435
00:17:58.361 --> 00:18:00.622
That has led to some, obviously, some downstream.
436
00:18:00.642 --> 00:18:03.263
You know what it's like to do a refactor, so it's a pain in the butt.
437
00:18:03.723 --> 00:18:07.285
And the second thing we worked on is importing and implementation calls.
438
00:18:07.545 --> 00:18:14.208
I know this is something you did a lot at Service Autopilot, and that was make sure they stay in the first 30, 60 days.
439
00:18:14.228 --> 00:18:15.048
Yeah, the onboarding.
440
00:18:15.208 --> 00:18:17.129
Yeah, so we lost 29% of members in the first 90 days.
441
00:18:18.710 --> 00:18:25.034
And so it's just mostly because it's like, hey, here's all these resources and academy, but it's not like structured implementation calls.
442
00:18:25.054 --> 00:18:34.040
So we now have where it's like Monday, Tuesday, every single day of the first week, you join for one hour on small group sessions and we will do the importing process for you.
443
00:18:34.380 --> 00:18:45.608
Like we were always talking about onboarding, but it was like they don't have any import of their data, let alone know how to use the software to actually then get to activation, which is like invoice, dispatch, send it, you know, get payment, et cetera.
444
00:18:46.088 --> 00:18:49.850
So we finally have it installed and I think it'll be a lot better.
445
00:18:50.550 --> 00:18:50.770
Good.
446
00:18:50.830 --> 00:18:51.290
Yeah, boy.
447
00:18:51.630 --> 00:18:53.091
Onboarding was in the whole...
448
00:18:53.111 --> 00:18:55.632
So we owned the business for just about nine years.
449
00:18:56.112 --> 00:18:58.373
I swear for all nine years, we talked about onboarding.
450
00:18:58.473 --> 00:19:01.735
Like you're always looking for the silver bullet to get people to stick.
451
00:19:02.295 --> 00:19:13.500
Do you have many of your new clients, whatever you call them, do they talk to somebody on the team like a sales call or do most just sign up online?
452
00:19:13.520 --> 00:19:13.620
Yeah.
453
00:19:13.913 --> 00:19:16.254
About 60% go through a salesperson.
454
00:19:16.734 --> 00:19:19.434
Those tend to be all the guys that are three, four, five million.
455
00:19:20.054 --> 00:19:24.916
Most of the smaller guys that are joining at the lower tier do just sign up organically.
456
00:19:25.396 --> 00:19:29.377
But now it's like we're basically forcing people in these, like we're going to harass them.
457
00:19:29.397 --> 00:19:30.057
I told they support you.
458
00:19:30.097 --> 00:19:33.318
I want you harassing them with text, email, phone calls.
459
00:19:33.578 --> 00:19:34.738
I want you on the support chat.
460
00:19:34.778 --> 00:19:39.639
I want them like in these calls because it leads to way more work for us anyways down the road when they don't know how to use it.
461
00:19:39.799 --> 00:19:41.339
Where they skip a couple sessions.
462
00:19:41.760 --> 00:19:41.980
Yeah.
463
00:19:44.080 --> 00:19:44.540
Yeah.
464
00:19:44.901 --> 00:19:48.964
Fun fact, Brent Banks, one of the owners at Augusta, he said he joined Service Autopilot like nine years ago.
465
00:19:49.504 --> 00:19:53.967
And he said that first two months he was just harassed to get on, like get in the calls.
466
00:19:53.987 --> 00:19:55.928
I'm like, yes, I know we need to do this too.
467
00:19:56.349 --> 00:19:57.089
It's critical.
468
00:19:57.109 --> 00:20:06.976
I mean, I think a lot of the, like if you could look at Service Autopilot clients that were really happy and you kind of looked at how they used the tech, they were using it like as we kind of imagined.
469
00:20:07.457 --> 00:20:11.820
And then we would talk to some people that don't like Service Autopilot and like, yeah,
470
00:20:12.320 --> 00:20:14.841
they're not even using invoicing.
471
00:20:14.901 --> 00:20:15.922
It would blow our mind.
472
00:20:16.322 --> 00:20:17.243
Like, wait a second.
473
00:20:17.263 --> 00:20:20.004
Manually putting things into QuickBooks and sending invoices and payments.
474
00:20:20.024 --> 00:20:21.465
Like, no, no, no, it's all here.
475
00:20:22.025 --> 00:20:22.986
Yeah.
476
00:20:23.166 --> 00:20:25.207
So the implementation was so incredible.
477
00:20:25.507 --> 00:20:41.196
Do you guys, we'll move on, but do you do a, one thing that really helped us is having the sales team do a actual intro handoff to onboarding, like almost three way I'm in and introduce them over to the onboarding team and hand them over to onboarding.
478
00:20:41.656 --> 00:20:50.538
It also helps with keeping the client from constantly calling sales back because now they have a new relationship with somebody on onboarding.
479
00:20:50.558 --> 00:20:52.859
But that was a little thing that absolutely helped us.
480
00:20:53.079 --> 00:20:55.059
Like do the intro, hand them over.
481
00:20:55.439 --> 00:20:57.020
We're moving you to the next phase.
482
00:20:57.540 --> 00:20:59.200
Here's what we expect from you.
483
00:20:59.500 --> 00:21:02.381
Here's how you can, we want you to be incredibly successful.
484
00:21:02.421 --> 00:21:03.561
Here's how you can get success.
485
00:21:04.001 --> 00:21:07.122
This is whomever and he's gonna take it from here.
486
00:21:07.522 --> 00:21:08.262
You're gonna love his result.
487
00:21:08.282 --> 00:21:10.743
Was it actually on a live call or you just did an email?
488
00:21:10.763 --> 00:21:11.183
Live call.
489
00:21:11.563 --> 00:21:11.724
Yeah.
490
00:21:11.804 --> 00:21:12.004
All right.
491
00:21:12.605 --> 00:21:12.845
Yeah.
492
00:21:12.885 --> 00:21:17.472
I don't know if it'll work for you, but we made that change and we never stopped it.
493
00:21:18.048 --> 00:21:21.490
Hey, well, you labeled me last time as the guy who ripped stuff off and just implements.
494
00:21:21.510 --> 00:21:22.670
So I am all in.
495
00:21:23.091 --> 00:21:23.571
Let's go.
496
00:21:26.172 --> 00:21:26.973
I'm just joking.
497
00:21:27.073 --> 00:21:27.473
I did.
498
00:21:27.513 --> 00:21:28.373
I might have.
499
00:21:28.513 --> 00:21:29.874
I might have.
500
00:21:30.174 --> 00:21:37.918
But hey, one of the things that always frustrated me so much was that people would call me and say, hey, I'm having this problem.
501
00:21:37.938 --> 00:21:40.299
And I'd say, oh, yeah, I've had that problem too.
502
00:21:40.459 --> 00:21:40.880
Do this.
503
00:21:41.760 --> 00:21:46.243
And then they do like 90 things around the thing and they wouldn't just do the thing.
504
00:21:46.283 --> 00:21:48.005
It's like, well, that's why it didn't work.
505
00:21:48.085 --> 00:21:51.407
I spent a million dollars learning that.
506
00:21:51.427 --> 00:21:57.211
The thing that's so frustrating is when someone's mad, you can't disqualify their anger.
507
00:21:58.072 --> 00:22:02.415
And just say like, you need to go back and watch the original, how to do the workflow.
508
00:22:02.775 --> 00:22:05.477
Cause they don't want to watch an hour long video of how to correctly.
509
00:22:05.697 --> 00:22:08.119
You like, ah, so anyways, we got to do it.
510
00:22:08.139 --> 00:22:14.824
We got to do it from the beginning and we got to force people into it and they won't like it, but it's a whole lot better than six months in and I'm not knowing how to do it.
511
00:22:14.864 --> 00:22:16.665
So anyways, thank you for the feedback.
512
00:22:16.905 --> 00:22:18.026
Stay the course on that.
513
00:22:18.266 --> 00:22:19.967
It's like, it's so imperative.
514
00:22:20.208 --> 00:22:20.388
Yeah.
515
00:22:20.448 --> 00:22:20.848
I appreciate it.
516
00:22:20.868 --> 00:22:23.610
So frustrating too, because you'll still be talking about it in two years.
517
00:22:23.850 --> 00:22:25.592
Hey, it'll be better than today.
518
00:22:25.792 --> 00:22:26.533
What are you working on?
519
00:22:26.733 --> 00:22:28.015
I know you just got back for your vacation.
520
00:22:28.495 --> 00:22:30.117
Yeah, but I've been back at it.
521
00:22:30.317 --> 00:22:33.081
I got a lot of things to work on, but maybe I'll say two.
522
00:22:33.361 --> 00:22:39.388
So one, I'm so dang frustrated looking at data for CityTurf, like around marketing attribution.
523
00:22:39.708 --> 00:22:39.868
Mm-hmm.
524
00:22:40.629 --> 00:22:47.211
And so I just cannot get LSA to perform at a CAC that I'm happy with.
525
00:22:47.531 --> 00:22:50.592
This would be something I'd be interested to talk to you about.
526
00:22:51.152 --> 00:22:55.954
Now, I will say I'm not looking at my LSA data by service line.
527
00:22:56.094 --> 00:22:56.474
I can't.
528
00:22:56.654 --> 00:22:57.975
It's really complicated.
529
00:22:58.575 --> 00:23:05.237
But if I look at it as a whole, the numbers are just... LSA is still one of my worst...
530
00:23:05.417 --> 00:23:07.377
It is my worst performing of all channels.
531
00:23:07.618 --> 00:23:07.818
Really?
532
00:23:07.838 --> 00:23:08.738
What's your close rate on it?
533
00:23:09.238 --> 00:23:13.619
I believe it's in the 30% range, which is really, it's not good for us.
534
00:23:14.179 --> 00:23:18.220
But one of our single biggest problems is, I'll give you an example.
535
00:23:19.000 --> 00:23:21.221
We've got it right, so I've been testing stuff.
536
00:23:21.241 --> 00:23:25.201
I've got it locked down right now to only calls, no messaging, okay?
537
00:23:25.361 --> 00:23:27.302
And I know that's a bit of a challenge, but I have it.
538
00:23:27.922 --> 00:23:35.063
So of 170 leads in May, only 43 were qualified leads.
539
00:23:35.403 --> 00:23:37.384
Qualified, not sold, just qualified.
540
00:23:37.424 --> 00:23:37.884
Qualified.
541
00:23:38.448 --> 00:23:40.588
Just like they were not cut.
542
00:23:40.789 --> 00:23:43.469
Like the majority of everybody clicking on it are our clients.
543
00:23:44.549 --> 00:23:47.150
Are they actually getting refunded though from LSA?
544
00:23:47.490 --> 00:23:49.010
Yeah, but we have to fight a lot of them.
545
00:23:49.050 --> 00:23:49.290
Really?
546
00:23:49.350 --> 00:23:50.891
It's like we don't necessarily get them all.
547
00:23:51.231 --> 00:23:59.693
It's really running up our – it's like the – it's the single biggest problem we have, like getting Google to refund us for all the clients.
548
00:23:59.753 --> 00:24:00.493
Yeah, they're using AI.
549
00:24:00.513 --> 00:24:00.773
Yeah.
550
00:24:01.635 --> 00:24:07.058
Yeah, and the client doesn't always say the right words on the call.
551
00:24:07.358 --> 00:24:08.818
So we have to go back to Google.
552
00:24:08.858 --> 00:24:09.639
It's like a hit or miss.
553
00:24:09.919 --> 00:24:12.400
But it's killing our conversion cost.
554
00:24:12.740 --> 00:24:14.161
It's just destroying it.
555
00:24:14.561 --> 00:24:19.163
Did your call person say the words, are you an existing customer?
556
00:24:19.463 --> 00:24:20.024
Great question.
557
00:24:20.544 --> 00:24:21.824
That's been really helpful for us.
558
00:24:21.984 --> 00:24:24.646
I believe we do, but that's a great question.
559
00:24:24.846 --> 00:24:26.767
We have somebody that's listening to every single call.
560
00:24:27.547 --> 00:24:32.201
that we have basically somebody that listens to every single thing and scores it and notates that.
561
00:24:32.261 --> 00:24:32.863
But, um,
562
00:24:33.880 --> 00:24:34.420
I'll check on that.
563
00:24:34.440 --> 00:24:35.481
That's a good, good little.
564
00:24:35.601 --> 00:24:39.583
And then the other little thing might look into, there's a little service called LSA Respond.
565
00:24:40.063 --> 00:24:44.506
They do a great job and they will, they will actually do like the fighting for you.
566
00:24:44.526 --> 00:24:45.886
Okay.
567
00:24:45.906 --> 00:24:49.468
And also you could turn on the text because they'll do the immediate responses too.
568
00:24:49.748 --> 00:24:50.449
So just, just.
569
00:24:50.509 --> 00:24:51.009
Oh, they do?
570
00:24:51.209 --> 00:24:51.429
Yeah.
571
00:24:51.809 --> 00:24:51.969
Yeah.
572
00:24:52.330 --> 00:24:52.450
Oh.
573
00:24:53.070 --> 00:24:57.312
So they, they will take care of all of like, basically you don't have to respond to LSA.
574
00:24:57.592 --> 00:24:58.313
Oh, how interesting.
575
00:24:58.333 --> 00:24:58.713
Yeah.
576
00:24:59.003 --> 00:24:59.624
Do you use them?
577
00:25:00.084 --> 00:25:03.007
A lot of our owners, we have a preferred vendor relationship with them, but it's not expensive.
578
00:25:03.307 --> 00:25:03.668
Oh, wow.
579
00:25:03.808 --> 00:25:04.669
That's very interesting.
580
00:25:05.850 --> 00:25:10.995
Do you have good success getting most of your refunds from Google if it's a client?
581
00:25:11.415 --> 00:25:16.981
Pretty good, as long as they call because we do ask every time, are you an existing customer?
582
00:25:17.319 --> 00:25:23.981
I don't know how we couldn't be asking because we eliminated from our phone tree the button for are you a client.
583
00:25:24.341 --> 00:25:26.881
Now, that used to probably be part of the problem.
584
00:25:27.341 --> 00:25:29.362
And that's, oh, man, I'm glad we're talking about this.
585
00:25:29.382 --> 00:25:30.762
I hope this is interesting for other people.
586
00:25:31.202 --> 00:25:34.003
We, for the longest time, used to just answer the phone.
587
00:25:34.863 --> 00:25:41.565
Then a while back, we tested going to a phone tree, one for client, two for prospect or whatever we said.
588
00:25:41.585 --> 00:25:41.805
Mm-hmm.
589
00:25:42.185 --> 00:25:43.986
We've since eliminated that again.
590
00:25:44.006 --> 00:25:47.749
And we've gone back to just answering the call immediate.
591
00:25:47.769 --> 00:25:48.469
We have no phone tree.
592
00:25:48.489 --> 00:25:49.830
We just don't like the phone trees.
593
00:25:51.431 --> 00:25:53.432
I need to find out when did we eliminate that?
594
00:25:53.592 --> 00:25:54.052
That could be.
595
00:25:54.293 --> 00:25:54.513
Yeah.
596
00:25:54.533 --> 00:25:55.714
So we've always done it that way.
597
00:25:55.734 --> 00:26:04.779
But what I have seen is people that had the auto, based upon the phone number coming in, you just knew the client and we could pull it up.
598
00:26:05.039 --> 00:26:09.102
The problem now is you have no words of like existing client in there.
599
00:26:09.402 --> 00:26:10.643
And so just something to think about.
600
00:26:10.883 --> 00:26:11.663
That's another thing.
601
00:26:12.063 --> 00:26:12.284
Yeah.
602
00:26:12.404 --> 00:26:13.104
With our system.
603
00:26:13.424 --> 00:26:13.664
Okay.
604
00:26:13.904 --> 00:26:14.224
Thank you.
605
00:26:14.244 --> 00:26:18.346
That's a really nice insight, but you think you get a pretty good refund.
606
00:26:18.386 --> 00:26:19.146
It's our best one.
607
00:26:19.306 --> 00:26:20.207
It's Oh, Oh, Oh yeah.
608
00:26:20.227 --> 00:26:20.587
Refund.
609
00:26:20.967 --> 00:26:22.127
Ellis is your best.
610
00:26:22.327 --> 00:26:22.467
Yeah.
611
00:26:22.487 --> 00:26:22.988
It's our best.
612
00:26:23.088 --> 00:26:24.448
We can't, we can't beat it with anything else.
613
00:26:24.628 --> 00:26:29.630
Like if we could keep, if we could spend more every single location and Augusta leads, we would spend more on.
614
00:26:30.110 --> 00:26:36.913
See, this is what's just, so today I've been very frustrated because I've been thinking about this and we've been trying to be incredibly fast and,
615
00:26:37.673 --> 00:26:40.934
Our weekend data is worse than our during the week data by a lot.
616
00:26:41.934 --> 00:26:45.575
Meaning because we do staff on the weekend, but we don't staff at the same level.
617
00:26:45.595 --> 00:26:47.096
So our answering service picks up more.
618
00:26:47.796 --> 00:26:49.537
I just can't figure out what the issue is.
619
00:26:49.617 --> 00:26:55.098
I've talked to multiple really big, like $100 million type private equity funded business.
620
00:26:55.378 --> 00:26:57.959
They swear that LSA is their best lead source.
621
00:26:58.379 --> 00:27:00.340
I've had good success with LSA.
622
00:27:00.520 --> 00:27:00.660
Yeah.
623
00:27:01.340 --> 00:27:05.626
But it's not, it's never been great, but it's really not performing right now.
624
00:27:05.666 --> 00:27:06.787
And I cannot figure out why.
625
00:27:07.148 --> 00:27:08.149
Organics, great.
626
00:27:08.790 --> 00:27:12.956
Google Ads, Google Ads is half the cost of LSA for me.
627
00:27:13.777 --> 00:27:16.921
Yeah, but you're telling me, do you run just lawn mowing?
628
00:27:18.030 --> 00:27:19.572
Oh, yeah, gateway service only.
629
00:27:19.772 --> 00:27:23.936
See, I've got several friends that only run lawn mowing, and they love LSA.
630
00:27:25.017 --> 00:27:25.197
Yeah.
631
00:27:25.277 --> 00:27:27.599
I'm running pest control, irrigation.
632
00:27:27.699 --> 00:27:27.940
Yeah.
633
00:27:28.540 --> 00:27:30.222
And see, we don't really sell lawn mowing.
634
00:27:30.242 --> 00:27:32.023
We don't market mowing at all.
635
00:27:32.364 --> 00:27:35.326
Well, just out of curiosity, what would you consider your gateway service usually?
636
00:27:36.087 --> 00:27:39.751
Or is it like- Well, it would be lawn mowing, but we don't- Lawn mowing's the best service.
637
00:27:39.871 --> 00:27:40.451
But you don't do it.
638
00:27:40.471 --> 00:27:41.893
So of like-
639
00:27:42.835 --> 00:27:43.135
I don't know.
640
00:27:43.256 --> 00:27:45.137
Let's say we have 11,800 clients.
641
00:27:45.918 --> 00:27:47.520
I think it's directionally accurate.
642
00:27:48.000 --> 00:27:49.782
I don't know what it is today.
643
00:27:49.882 --> 00:27:51.704
11,100 are fertilization weed control clients.
644
00:27:52.325 --> 00:27:54.888
Like everybody buys fertilization weed control from us.
645
00:27:55.388 --> 00:27:59.573
But that's not been a successful service to run for us with LSA.
646
00:28:00.433 --> 00:28:00.834
I don't know.
647
00:28:00.934 --> 00:28:02.395
Have you ran that?
648
00:28:02.736 --> 00:28:03.457
Not as much.
649
00:28:03.757 --> 00:28:04.177
Not as much.
650
00:28:04.257 --> 00:28:05.098
It's like, yeah.
651
00:28:05.158 --> 00:28:05.399
So...
652
00:28:05.859 --> 00:28:12.747
So mowing is the most successful gateway, but we do not market mowing at all because we're not growing that business.
653
00:28:13.769 --> 00:28:17.974
And we and so that's where it's like, OK, well, I can't run mowing ads.
654
00:28:18.414 --> 00:28:20.176
You're selling you're selling those on the phone, though, right?
655
00:28:20.196 --> 00:28:22.219
Like you're selling fertilization we control over the phone.
656
00:28:23.871 --> 00:28:24.673
Yeah, we convert.
657
00:28:24.873 --> 00:28:27.577
I think we're converting at like 53% fertilization.
658
00:28:27.597 --> 00:28:29.800
We control leads through organic or something like that.
659
00:28:29.860 --> 00:28:35.988
But that includes the people that are just outside our market or people that like, I just want an application.
660
00:28:36.269 --> 00:28:38.191
So we don't sell those.
661
00:28:38.292 --> 00:28:39.253
I think that's where we're at.
662
00:28:39.653 --> 00:28:41.714
We'll probably be moving into switching away.
663
00:28:42.135 --> 00:28:43.035
It's just spring rush.
664
00:28:43.075 --> 00:28:44.036
Mowing is always the best.
665
00:28:44.256 --> 00:28:47.958
We'll probably shift towards different services as the mowing season.
666
00:28:48.258 --> 00:28:52.660
Our lead, we can see our cost per lead slowly rising right now across the system.
667
00:28:52.900 --> 00:28:54.361
So we'll probably shift to different services.
668
00:28:54.801 --> 00:28:57.523
It's just our first year with Augusta Leeds where I have so much data.
669
00:28:57.763 --> 00:29:01.825
So I'll keep you in the loop if we switch to any locations just doing fertilization we control.
670
00:29:02.553 --> 00:29:03.234
I'd love to know.
671
00:29:03.394 --> 00:29:03.594
Yeah.
672
00:29:03.614 --> 00:29:10.141
I need to, I've got a number of, I've got a number of friends that I can ask this question, but they're all going to try to sell me SEO.
673
00:29:10.541 --> 00:29:13.384
But I don't want to have the conversation.
674
00:29:13.825 --> 00:29:16.167
So I just like, so I haven't called any of them.
675
00:29:16.207 --> 00:29:17.789
So I'm just trying to figure it out.
676
00:29:18.049 --> 00:29:18.189
Yeah.
677
00:29:18.229 --> 00:29:18.550
Interesting.
678
00:29:18.670 --> 00:29:22.834
But what you're saying, if they're qualified, are you selling 53% of them?
679
00:29:22.854 --> 00:29:24.236
Through organic, but not through LSA.
680
00:29:24.776 --> 00:29:26.077
So LSA is the one that's 30.
681
00:29:26.437 --> 00:29:26.777
Oh, no.
682
00:29:26.817 --> 00:29:27.417
LSA.
683
00:29:27.877 --> 00:29:28.218
Oh, man.
684
00:29:28.238 --> 00:29:30.418
I was just, I mean, too much data in my head.
685
00:29:30.459 --> 00:29:32.179
I mean, I've been looking at spreadsheets today.
686
00:29:32.199 --> 00:29:34.960
Because we found the quality of the lead is so good.
687
00:29:35.000 --> 00:29:37.101
We closed like, that's our highest conversion.
688
00:29:37.301 --> 00:29:37.662
Oh, yeah.
689
00:29:37.942 --> 00:29:38.382
Not for us.
690
00:29:38.402 --> 00:29:38.742
Really?
691
00:29:39.042 --> 00:29:39.963
That's just why I'm confused.
692
00:29:40.123 --> 00:29:45.485
But I wonder if I turned everything off and just ran lawn mowing leads as a test, what would happen?
693
00:29:45.705 --> 00:29:46.465
Hey, send them my way.
694
00:29:46.485 --> 00:29:46.866
Let's go.
695
00:29:49.387 --> 00:29:49.847
I'll take them.
696
00:29:50.427 --> 00:29:51.367
How much are we buying for?
697
00:29:51.487 --> 00:29:54.309
I'll switch release.
698
00:29:54.329 --> 00:29:58.090
So you've been working on LSA stuff, marketing data.
699
00:29:58.410 --> 00:29:59.631
Yeah, data.
700
00:29:59.711 --> 00:30:01.011
I'm really frustrated by it.
701
00:30:01.612 --> 00:30:04.473
I'm so frustrated because I just can't, like, why?
702
00:30:04.533 --> 00:30:05.633
I can't figure out the why.
703
00:30:05.673 --> 00:30:09.335
I've talked to a number of other people that are in front of a lot of, like,
704
00:30:10.035 --> 00:30:10.856
revenue.
705
00:30:11.136 --> 00:30:14.279
And they're like, yeah, some of my clients use LSA.
706
00:30:14.299 --> 00:30:16.001
Some of my clients don't use LSA.
707
00:30:16.521 --> 00:30:17.902
Today is so frustrating.
708
00:30:17.922 --> 00:30:20.905
Today's one of those days of like, why am I doing this?
709
00:30:21.165 --> 00:30:21.966
I really don't.
710
00:30:22.567 --> 00:30:23.507
I could just be...
711
00:30:24.397 --> 00:30:25.599
racing a car around the track.
712
00:30:25.699 --> 00:30:26.520
Why am I doing this?
713
00:30:26.801 --> 00:30:31.047
You know what's so funny is we both have the same thoughts, but for different reasons, right?
714
00:30:31.328 --> 00:30:33.691
Like, you don't, you literally don't need to do it.
715
00:30:34.092 --> 00:30:36.596
For me on the other hand, it's like, why do I put myself through this?
716
00:30:36.656 --> 00:30:38.158
Like, just lower your goals.
717
00:30:38.178 --> 00:30:39.260
You don't need to do this stuff.
718
00:30:39.320 --> 00:30:39.580
So...
719
00:30:40.141 --> 00:30:40.681
That's interesting.
720
00:30:40.701 --> 00:30:45.425
Oh, I mean, this is, but, but there's no way I wouldn't because the minute, this is my joke.
721
00:30:45.445 --> 00:30:51.369
Like as soon as I'm in a car on the track, the single most important thing is full on a hundred percent focus.
722
00:30:51.409 --> 00:30:53.570
Like you're going, like it could go really bad.
723
00:30:53.830 --> 00:30:55.251
And my brain's thinking about work.
724
00:30:55.551 --> 00:30:55.772
Yeah.
725
00:30:55.812 --> 00:30:55.992
Like.
726
00:30:56.412 --> 00:30:57.272
What is wrong with me?
727
00:30:57.392 --> 00:30:58.373
It's an LSA ad.
728
00:30:58.433 --> 00:30:58.853
Goodness.
729
00:30:58.873 --> 00:30:59.613
Can't get that thing set.
730
00:30:59.693 --> 00:31:00.033
It would.
731
00:31:00.114 --> 00:31:05.216
I literally, I'm riding a dirt bike through the trees, trying to keep up with guys that are faster than me.
732
00:31:05.496 --> 00:31:11.358
And if I'm not going full speed, like as hard as I can go, my brain gets distracted and I start thinking about work.
733
00:31:11.778 --> 00:31:15.560
I have to be going all out on whatever I'm doing or my brain gets noisy.
734
00:31:16.280 --> 00:31:18.481
It's like so frustrating, but I could never do anything else.
735
00:31:18.561 --> 00:31:19.681
At the end of the day, I still love this stuff.
736
00:31:19.701 --> 00:31:21.022
It's just like, why?
737
00:31:23.264 --> 00:31:23.904
All right, here, what are we?
738
00:31:23.924 --> 00:31:25.265
We're like 35, 40 minutes in.
739
00:31:25.285 --> 00:31:26.405
We're 30 minutes deep.
740
00:31:26.445 --> 00:31:27.245
There's our cold open.
741
00:31:27.865 --> 00:31:28.725
Question number one.
742
00:31:28.845 --> 00:31:37.147
All right, topic number one I got for us today is the whole idea of buying businesses is super hot on social media.
743
00:31:37.168 --> 00:31:38.128
It's been hot for a while.
744
00:31:38.188 --> 00:31:40.128
I use Cody Sanchez as an example.
745
00:31:40.388 --> 00:31:42.929
Like, I don't know if she single-handedly made it really hot.
746
00:31:43.369 --> 00:31:46.031
But it's like, she's really all over that topic.
747
00:31:46.071 --> 00:31:48.033
So what's your general feeling on?
748
00:31:48.073 --> 00:31:50.415
Is it a good idea, bad idea to be buying businesses?
749
00:31:50.435 --> 00:31:57.861
There's a couple ways you could look at it, like good or bad for an existing business owner versus a lot of the people that are selling this concept.
750
00:31:57.941 --> 00:31:59.803
It's like new business opportunity stuff.
751
00:32:00.163 --> 00:32:02.045
So it's like, this is how you get into business.
752
00:32:02.065 --> 00:32:02.746
You buy a business.
753
00:32:02.766 --> 00:32:04.207
So where do you stand on topics like this?
754
00:32:04.597 --> 00:32:06.579
Yeah, I think you hit the nail on the head.
755
00:32:06.760 --> 00:32:13.367
It is the total addressable market of people who should buy businesses is too small for social media.
756
00:32:13.908 --> 00:32:17.913
And so we've got to dumb it down and make it where you can just walk into a business
757
00:32:18.435 --> 00:32:18.875
They're old.
758
00:32:18.935 --> 00:32:19.816
They got gray hair.
759
00:32:20.276 --> 00:32:21.197
They don't have kids.
760
00:32:21.457 --> 00:32:23.218
They must be wanting to give the business away.
761
00:32:23.238 --> 00:32:25.240
I can step in and do it.
762
00:32:25.960 --> 00:32:29.623
So I'd say as a rule of thumb, I don't think new entrepreneurs should really do it.
763
00:32:30.584 --> 00:32:32.685
I will asterisk that by saying that I have done it.
764
00:32:32.865 --> 00:32:34.687
And that was, I bought Anytime Fitness.
765
00:32:35.267 --> 00:32:36.208
And so... Oh, yeah.
766
00:32:36.428 --> 00:32:36.708
Yeah.
767
00:32:36.748 --> 00:32:38.449
So... How old were you when you did that?
768
00:32:38.689 --> 00:32:39.050
Oh, man.
769
00:32:39.370 --> 00:32:39.890
21.
770
00:32:39.930 --> 00:32:40.070
Okay.
771
00:32:40.090 --> 00:32:40.691
And so...
772
00:32:43.993 --> 00:32:46.115
And essentially I did it for zero dollars down.
773
00:32:46.175 --> 00:32:50.459
So like the quintessential no money down, I kind of pulled it off using SBA loan.
774
00:32:50.859 --> 00:32:54.422
Basically how I did it was the fifty thousand dollar ten percent down payment.
775
00:32:54.823 --> 00:32:58.406
The owner basically said, hey, I'm going to hold one month of revenue remit.
776
00:32:58.446 --> 00:33:00.868
That's called independence of membership dues.
777
00:33:01.068 --> 00:33:06.433
So the day you get it, you can take the 50 grand out and go, you know, pay yourself back, essentially.
778
00:33:06.993 --> 00:33:10.676
And so I just had to float the 50 grand for about a week and a half to two weeks.
779
00:33:11.317 --> 00:33:19.063
And then the business cash flowed from day one, even after the debt, the loan service of like, I think I'm paying like $5,300 a month back then.
780
00:33:19.523 --> 00:33:23.787
I paid it off, but like, um, the loan payment was like 5,300 bucks a month.
781
00:33:24.127 --> 00:33:24.868
So I kind of did it.
782
00:33:24.888 --> 00:33:27.690
However, I would say like, I had some unique advantages.
783
00:33:27.950 --> 00:33:29.591
I had worked there as an employee for three years.
784
00:33:30.612 --> 00:33:33.636
I knew the owner, Anthony, ex-military guy.
785
00:33:33.656 --> 00:33:35.217
He was my first boss.
786
00:33:35.478 --> 00:33:37.900
I got hired there when I was 16 as a trainer.
787
00:33:38.841 --> 00:33:39.702
I knew all the clients.
788
00:33:39.783 --> 00:33:41.084
I knew the area at the back of my hand.
789
00:33:41.104 --> 00:33:42.506
I had a lot of built-up trust with the owner.
790
00:33:42.686 --> 00:33:46.270
So even through the negotiations, I just trusted him.
791
00:33:47.010 --> 00:33:52.895
And honestly, in hindsight, I did not do enough due diligence, but I could trust him and that's why it could work.
792
00:33:53.395 --> 00:33:57.058
Also, another unique circumstance was it was a small town.
793
00:33:57.278 --> 00:33:58.599
There's like no competition.
794
00:33:58.959 --> 00:34:01.221
So Blaine Washington has like six or seven thousand people.
795
00:34:01.521 --> 00:34:03.042
There's not enough room for another gym.
796
00:34:04.003 --> 00:34:05.665
And like, there is no second player.
797
00:34:05.685 --> 00:34:09.748
There's no like Planet Fitness ever going to move in or Equinox or no one else is moving in.
798
00:34:10.449 --> 00:34:16.254
And then the other unique part is like the franchise had the systems that I needed to be successful.
799
00:34:16.835 --> 00:34:18.936
So I didn't need to be an excellent operator.
800
00:34:18.956 --> 00:34:19.417
Yeah.
801
00:34:19.637 --> 00:34:25.019
Because there was already so many systems put in place and like parameters that you can and cannot do these certain things.
802
00:34:25.199 --> 00:34:30.820
Like you can't just go like whip up a nutrition plan or like start some other type of equipment or like paint your walls, whatever.
803
00:34:30.840 --> 00:34:34.541
So the franchise system was good for me being a young entrepreneur.
804
00:34:35.181 --> 00:34:40.823
But I think that the social media version of buying a business kind of underweights two things.
805
00:34:41.483 --> 00:34:42.544
I kind of bucketed into two things.
806
00:34:42.724 --> 00:34:43.544
One was debt risk.
807
00:34:44.384 --> 00:34:50.667
And can the business actually afford or survive a bad season when you're servicing the loan?
808
00:34:50.908 --> 00:34:58.392
It's like if I had the $5,300 per month in debt payments, if you take that out of what used to be the net income, is there any money left over?
809
00:34:58.412 --> 00:34:58.912
Yeah.
810
00:34:58.932 --> 00:34:59.112
Yeah.
811
00:34:59.672 --> 00:35:03.413
Also, I think when it comes to debt and financing, a lot of times people like SBA, easy, no money.
812
00:35:03.753 --> 00:35:05.534
It's not easy to get SBA financing.
813
00:35:05.634 --> 00:35:09.614
And it can be like six months long, let alone if the business doesn't have clean books.
814
00:35:10.095 --> 00:35:12.775
Fortunately, Anthony was like he already had like six clubs.
815
00:35:13.075 --> 00:35:14.436
So it was like very organized.
816
00:35:14.576 --> 00:35:15.556
It was really clean.
817
00:35:15.776 --> 00:35:19.697
It was easy to get on to like the landlord transferring the lease.
818
00:35:20.057 --> 00:35:23.498
But a lot of times with SBA financing, like they you have to have stuff buttoned down.
819
00:35:23.518 --> 00:35:24.098
Right.
820
00:35:24.498 --> 00:35:25.499
So that's like the debt side.
821
00:35:25.859 --> 00:35:27.701
I think people just kind of assume they can just get money.
822
00:35:27.741 --> 00:35:30.082
And that's the part that people is like glance over.
823
00:35:30.103 --> 00:35:31.864
It's like, oh, yeah, SBA financing 10% down.
824
00:35:31.884 --> 00:35:32.825
It's like, whoa, whoa, whoa.
825
00:35:32.845 --> 00:35:34.766
Like we're crossing a bunch of bridges here.
826
00:35:34.786 --> 00:35:37.048
Like, will the SBA invest?
827
00:35:37.208 --> 00:35:38.869
Are you able to afford the 10% down?
828
00:35:39.390 --> 00:35:42.092
Will the business service that debt?
829
00:35:42.312 --> 00:35:42.832
So that's the debt.
830
00:35:42.852 --> 00:35:46.155
The second part I think is a risk that's kind of glanced over is operator risk.
831
00:35:46.695 --> 00:35:49.777
And that is, is the buyer actually capable of running the business?
832
00:35:50.317 --> 00:35:55.840
A lot of times, any successful business or small business, that's like the boring business thing.
833
00:35:56.881 --> 00:36:00.042
If it's under $3 million a year, almost always it's a result of a great operator.
834
00:36:00.322 --> 00:36:03.404
And so if you take that person out, will the business still run?
835
00:36:03.744 --> 00:36:06.386
Depends on, is the person replacing them going to be just as good as that?
836
00:36:06.406 --> 00:36:06.946
Great operator.
837
00:36:07.286 --> 00:36:11.108
And so that operator risk, I think, is something that is overlooked.
838
00:36:11.548 --> 00:36:11.829
And then-
839
00:36:12.809 --> 00:36:13.790
Um, I'll bounce back to you.
840
00:36:13.810 --> 00:36:19.833
I have a couple other thoughts on this around owner financing too, but those are the two kind of buckets I think that is overlooked.
841
00:36:19.853 --> 00:36:22.054
It's like debt risk and then operator risk.
842
00:36:22.354 --> 00:36:22.554
Yeah.
843
00:36:22.574 --> 00:36:28.057
The other one that I, I think of this stuff is selling a business opportunity to kind of alluded to that.
844
00:36:28.177 --> 00:36:34.060
So I think it's dangerous because a lot of the people that are buying don't really have the experience.
845
00:36:34.080 --> 00:36:34.640
Um,
846
00:36:34.880 --> 00:36:40.384
And so you're not really... Now you're being thrown into something where you can't learn your way as you grow it.
847
00:36:40.424 --> 00:36:51.811
Now you got to come up to speed really fast and you're possibly inheriting bad culture, bad employees, family members that were working in the business that want to stay there, like problems and like you're...
848
00:36:52.211 --> 00:36:54.993
If you don't have quite a bit of experience, how do you even navigate that?
849
00:36:55.113 --> 00:37:03.478
Like, for example, if I were buying a business, the first thing I would spend a lot of time doing is figuring out who the people I have are
850
00:37:03.598 --> 00:37:03.958
in the business.
851
00:37:03.978 --> 00:37:09.482
Like what are, what's the capability and quality of the people in the business and what should they be doing?
852
00:37:09.502 --> 00:37:11.003
What should they stop doing in the business?
853
00:37:11.704 --> 00:37:14.706
That's a skill that I now have because I've done a bunch of stuff.
854
00:37:14.766 --> 00:37:16.927
If you're new to business, how do you do that?
855
00:37:17.368 --> 00:37:20.590
Like, so just that's really, really challenging in my mind.
856
00:37:20.970 --> 00:37:22.591
I don't know how most people overcome that.
857
00:37:23.212 --> 00:37:28.636
The other thing I was thinking about on this one is I know a lot of really, really wealthy, successful people.
858
00:37:28.676 --> 00:37:31.558
Again, my way I think, I think about bigger businesses.
859
00:37:31.658 --> 00:37:31.758
I,
860
00:37:32.238 --> 00:37:35.761
I don't really know any that have bought their way to where they're at today.
861
00:37:35.801 --> 00:37:38.923
Like almost everybody I know started their thing and built.
862
00:37:39.483 --> 00:37:40.804
That doesn't mean you can't buy your way.
863
00:37:40.824 --> 00:37:45.007
And I also know some people that they came up through the family business.
864
00:37:45.067 --> 00:37:46.708
I know a number of people that did that.
865
00:37:46.768 --> 00:37:48.169
They turned into great entrepreneurs.
866
00:37:48.189 --> 00:37:48.330
Yeah.
867
00:37:49.110 --> 00:37:52.574
But I don't know many people that started out and bought a business.
868
00:37:53.335 --> 00:38:00.904
I do know in the trades from having done Service All-Py, a bunch of people that bought a business and it got them into the industry.
869
00:38:01.325 --> 00:38:06.250
But I don't think most of them would say it was a great experience or a great deal.
870
00:38:06.671 --> 00:38:07.892
It was probably a mistake.
871
00:38:08.653 --> 00:38:11.035
but it got him in the business.
872
00:38:11.536 --> 00:38:16.961
And so, yeah, it might've been a mistake to buy it, but it also might not have, you might not ever got in the business had you not bought it.
873
00:38:16.981 --> 00:38:17.802
It's kind of that thing.
874
00:38:17.842 --> 00:38:23.066
So I tend to be a little nervous for somebody starting out buying a business.
875
00:38:23.467 --> 00:38:24.528
That's where I stand on this.
876
00:38:24.848 --> 00:38:31.433
Yeah, a lot of times the social media kind of talks about owner financing, but a lot of times that includes a balloon payment.
877
00:38:31.793 --> 00:38:36.477
It's like, well, it's three years interest only or like low payments.
878
00:38:36.557 --> 00:38:40.880
And at the end of three years, all you got to do is improve the business and then you'll be able to refinance it.
879
00:38:40.900 --> 00:38:44.523
But we have to assume that you are good enough operationally.
880
00:38:45.283 --> 00:38:51.809
to make the business worth more or cashflow more that when you go to a bank, they'll actually like give you money for it.
881
00:38:52.149 --> 00:38:53.911
And like, yes, we will give you a loan for this now.
882
00:38:54.011 --> 00:38:59.676
And so there's also stuff around like, is the entity structure even set up correctly?
883
00:38:59.756 --> 00:39:01.518
Are you taking a whole bunch of liability?
884
00:39:01.898 --> 00:39:03.840
And to your point, like there might be bad culture.
885
00:39:04.000 --> 00:39:08.204
The other part is like, there might be some really good employees that love the owner.
886
00:39:08.565 --> 00:39:10.787
And when you buy it, they leave, right?
887
00:39:10.827 --> 00:39:11.027
Yeah.
888
00:39:11.327 --> 00:39:14.528
And so I think overall, it's kind of a great starting point.
889
00:39:14.728 --> 00:39:20.610
It's not really a good starting point for new entrepreneurs, but I do see it as healthy for expansion and more of a growth engine.
890
00:39:20.970 --> 00:39:24.171
And this is something that actually came up on the mastermind for Augusta the other day.
891
00:39:24.211 --> 00:39:26.392
People were asking, like, hey, will you ever do like acquisitions?
892
00:39:27.712 --> 00:39:31.435
because they mentioned how Amazon and Apple have had 100 acquisitions, et cetera.
893
00:39:31.755 --> 00:39:39.142
And I said, in part, the tax code, when it comes to a C-corp, really does incentivize spending your money.
894
00:39:39.622 --> 00:39:43.766
Because otherwise, if you take that money out and distribute it to the shareholders, you're having double taxation.
895
00:39:44.466 --> 00:39:53.612
And so, although I have no idea or thoughts of doing acquisitions, it starts to make sense why a larger company starts to do acquisitions.
896
00:39:53.693 --> 00:39:58.536
And I know even originally when you had had the private equity come into SuperProtocop, that was the original thought.
897
00:39:58.556 --> 00:40:02.419
It's like, hey, we're going to go out and do acquisitions and bring and bolt them in.
898
00:40:02.779 --> 00:40:05.461
And so I think times people hear even someone like Alex is like.
899
00:40:06.041 --> 00:40:09.863
going out and buying companies or taking stakes and like bring it together and doing a roll up, et cetera.
900
00:40:09.883 --> 00:40:17.848
It's like, we're talking about a very different type of business in terms of size, in terms of sophistication and skill level of the people operating it.
901
00:40:18.189 --> 00:40:23.652
I think I can count on one hand, how many acquisitions inside of Augusta I've seen go well.
902
00:40:24.152 --> 00:40:27.254
And I can probably give you 10 examples of ones that went bad.
903
00:40:27.855 --> 00:40:31.077
And so the math usually isn't on the side of even trying to do the whole, like, the
904
00:40:31.757 --> 00:40:37.741
you know, aqua hire or like, uh, I should say, uh, I should like even the expansion side, when you take another brand, you try to pull it inside.
905
00:40:38.181 --> 00:40:40.002
There's still a lot of things that have to change.
906
00:40:40.382 --> 00:40:42.103
A lot of operators don't have the skill yet for that.
907
00:40:42.163 --> 00:40:46.326
And it's a lot of times they're just trying to bypass the time required to build something great.
908
00:40:46.766 --> 00:40:51.749
And it's more of a avenue of speed in terms of just growing it and building it slower.
909
00:40:52.029 --> 00:40:54.871
The acquisition is just, you do it just for speed.
910
00:40:55.251 --> 00:40:55.952
That's what you're saying.
911
00:40:56.372 --> 00:40:57.393
A lot of times that's what you see.
912
00:40:57.553 --> 00:40:57.713
Yeah.
913
00:40:58.357 --> 00:41:06.488
Yeah, it's just a matter of like, you know, you see variables either cost, like how much is it going to cost me and then time to build.
914
00:41:07.029 --> 00:41:14.239
And so I think a lot of times it's like, hey, I'm willing to pay a premium in order to buy this business for the exchange of the speed I can go if I buy it.
915
00:41:15.100 --> 00:41:32.572
I think people just discount how much do I can I integrate the this other business that I pull in these other customers, even if you buy a customer listing in a way it's like we we we see everything through rose colored glasses of how much time we will save, but not the long term cost associated with integrating them into our existing business.
916
00:41:33.271 --> 00:41:40.193
Yeah, that's where I would be personally open to buying a business is around the idea of expansion.
917
00:41:40.453 --> 00:41:52.656
So as an example, if I was going into a new geographic area, I might buy a like business to what I own to get myself a footprint in that market and probably wouldn't buy something overly large.
918
00:41:52.756 --> 00:41:55.396
And I'd use that as a base to sort of expand out.
919
00:41:55.736 --> 00:41:57.177
That's one way I would think about it.
920
00:41:57.597 --> 00:42:00.137
Another one I would think about is if I was going into a...
921
00:42:03.598 --> 00:42:06.260
septic systems and drainage as an example.
922
00:42:06.340 --> 00:42:11.724
Not something CityTurf does, but it's got some similarities that are, we've got people that would understand that business.
923
00:42:12.024 --> 00:42:12.845
I'm not buying my way.
924
00:42:12.945 --> 00:42:14.146
I thought we were doing pets, Jonathan.
925
00:42:14.646 --> 00:42:15.547
I thought we were doing pets.
926
00:42:15.607 --> 00:42:17.468
That was last week.
927
00:42:17.488 --> 00:42:18.809
That's last week.
928
00:42:18.910 --> 00:42:21.732
If you had $500,000 in cash, what new business would you buy?
929
00:42:21.752 --> 00:42:25.955
And it can be in the trades, but you can't leverage your existing business in any way.
930
00:42:26.235 --> 00:42:27.556
JP, what would you be doing now?
931
00:42:28.436 --> 00:42:28.717
Pets.
932
00:42:29.777 --> 00:42:30.018
Pets?
933
00:42:30.038 --> 00:42:30.138
Pets?
934
00:42:31.220 --> 00:42:32.381
Oh, I did not see that coming.
935
00:42:32.481 --> 00:42:32.842
Okay.
936
00:42:33.062 --> 00:42:34.503
I've been thinking about this for a while.
937
00:42:34.823 --> 00:42:37.286
I saw your $40,000 dog video editing.
938
00:42:37.646 --> 00:42:39.127
I'm done with pets.
939
00:42:39.548 --> 00:42:40.188
I'm done with pets.
940
00:42:40.209 --> 00:42:41.370
Yeah, that was last week's news.
941
00:42:41.690 --> 00:42:43.051
I'm now onto septic tanks.
942
00:42:43.091 --> 00:42:43.672
That's right.
943
00:42:43.712 --> 00:42:44.212
Let's go.
944
00:42:44.232 --> 00:42:45.594
Yeah.
945
00:42:46.014 --> 00:42:50.118
So now that we're buying a septic tank, but if I was thinking of...
946
00:42:51.679 --> 00:42:53.500
Okay, I'll save this.
947
00:42:53.960 --> 00:42:56.661
Pets just is too different of an add-on to CityTurf.
948
00:42:56.901 --> 00:42:58.482
If I'm starting from scratch, I'll do pets.
949
00:42:58.522 --> 00:43:00.563
We already have it in the logo.
950
00:43:00.663 --> 00:43:02.223
You already have it in the logo.
951
00:43:02.303 --> 00:43:02.903
There's that.
952
00:43:04.604 --> 00:43:08.826
But I do like the idea of if we were to get into a new business line,
953
00:43:09.786 --> 00:43:14.490
with the money that we have and the experience we have, I would be very interested in buying my way into that.
954
00:43:14.890 --> 00:43:23.116
It's a similar concept to if I'm going to spin up a new division in my business, I'm going to go hire a leader from the beginning that can run it, that has done it.
955
00:43:23.216 --> 00:43:26.938
It's got tons of experience versus us just trying to fully figure it out.
956
00:43:27.319 --> 00:43:34.464
So if I'm getting into a new line of business, I would be open to with the capital I've got and already having experience by my way in.
957
00:43:35.064 --> 00:43:37.185
And it doesn't need to be a giant company.
958
00:43:37.245 --> 00:43:38.606
That's one way I would think about it.
959
00:43:39.067 --> 00:43:57.158
And then I had a similar position to you in that if you've spent tons of money and your CAC is going up and you're just not getting the speed of growth that you want in the market and you've got the money, you could buy more speed by acquiring inside your market.
960
00:43:57.778 --> 00:44:03.119
But the whole, just like onboarding new people into your technology company, that's one level of pain.
961
00:44:03.159 --> 00:44:05.540
Imagine onboarding a new company into your company.
962
00:44:06.160 --> 00:44:13.602
Like, you know, and so, and I used to have at Service Autopilot, our COO, the second COO that we had at Service Autopilot, his name was Steve.
963
00:44:13.662 --> 00:44:14.142
Great guy.
964
00:44:14.762 --> 00:44:16.903
He used to be higher up in carrier.
965
00:44:17.323 --> 00:44:19.904
And, you know, they acquired a lot of companies.
966
00:44:19.984 --> 00:44:21.604
And this is just a little side thing.
967
00:44:22.124 --> 00:44:25.465
They had learned over time that when you buy companies, you don't rename them.
968
00:44:26.950 --> 00:44:27.650
I think it was at Carrie.
969
00:44:27.670 --> 00:44:36.138
It could have been one of those businesses with, there's onboarding, and then you see a lot of people that even buy companies, and then they try to make them the existing brand.
970
00:44:36.478 --> 00:44:37.579
And there's so much change.
971
00:44:37.599 --> 00:44:39.941
There's change happening within the organization with the people.
972
00:44:40.261 --> 00:44:41.863
Then there's change happening with the client.
973
00:44:42.223 --> 00:44:44.205
And that's a whole nother level of complication.
974
00:44:44.225 --> 00:44:47.267
So this stuff I feel like is sold on social media's,
975
00:44:48.088 --> 00:44:50.109
an easy way to be a business owner.
976
00:44:50.849 --> 00:44:59.011
And I mean, even if you're a sophisticated company with sophisticated people and a great management team, I still look at bringing a company in is incredibly difficult.
977
00:44:59.211 --> 00:45:06.472
So I think it's just like, anytime someone sells something as this is the easy way to do X, Y, and Z, I just immediately discount it.
978
00:45:07.012 --> 00:45:10.193
It's like, because if it was easy, everyone would do it, yes.
979
00:45:10.673 --> 00:45:11.974
And it's like, everyone should be an owner.
980
00:45:12.034 --> 00:45:14.554
And I think that's the dumbest thing anyone has ever said.
981
00:45:15.214 --> 00:45:17.055
And so I like Cody Sanchez.
982
00:45:17.315 --> 00:45:17.875
Thank you, Cody.
983
00:45:18.155 --> 00:45:18.816
Oh, yeah, yeah, yeah.
984
00:45:18.836 --> 00:45:19.676
I'm not knocking, but yeah.
985
00:45:19.696 --> 00:45:26.220
But when she talks about ownership, I understand where she's coming from, but someone should, I think the vast majority of people when it comes to ownership should be passive investors.
986
00:45:26.520 --> 00:45:27.600
They should not be operators.
987
00:45:28.001 --> 00:45:29.402
And I think I believe in ownership.
988
00:45:29.502 --> 00:45:33.264
I do not believe that most people or everyone should be an owner.
989
00:45:33.824 --> 00:45:36.405
Like it is bad for the people they lead.
990
00:45:36.545 --> 00:45:37.645
It is bad for the customers.
991
00:45:37.965 --> 00:45:39.186
It's bad for their personal health.
992
00:45:39.266 --> 00:45:40.506
It's bad for their mental health.
993
00:45:40.746 --> 00:45:41.766
It's bad for their family.
994
00:45:41.866 --> 00:45:43.027
It's bad for their personal goals.
995
00:45:43.387 --> 00:45:46.688
And so I think it's a popular thing to say, but I think it's very dangerous.
996
00:45:47.068 --> 00:45:54.310
And to what we talked about earlier about the mental health stuff, if the expectation is it is so easy to do business and you should just go buy it,
997
00:45:54.830 --> 00:45:59.673
How's that gonna make everyone feel that's grinding, hustling, and feel like they're a loser for the first year or two while they're trying to figure it out?
998
00:45:59.974 --> 00:46:05.818
Because there's this easy button over here I missed somehow because I didn't find someone to just go buy their business and cashflow from day one.
999
00:46:06.438 --> 00:46:07.739
And so, I don't know.
1000
00:46:07.819 --> 00:46:08.840
I think it's dangerous sometimes.
1001
00:46:09.180 --> 00:46:10.461
Yeah, I would agree with you.
1002
00:46:10.861 --> 00:46:12.942
That's an interesting, I'm trying to figure out how to word this.
1003
00:46:13.082 --> 00:46:19.907
I know some data on some very big name software companies that sell essentially business opportunity.
1004
00:46:20.407 --> 00:46:23.429
They sell software, but they're selling to a business opportunity crowd.
1005
00:46:23.770 --> 00:46:23.910
Mm-hmm.
1006
00:46:24.644 --> 00:46:26.645
And mind-boggling churn.
1007
00:46:27.306 --> 00:46:28.367
Mind-boggling churn.
1008
00:46:28.807 --> 00:46:48.541
And I never thought about it until you just said it, like what that even does to the person on the other side of the transaction in regards to they buy this thing, they thought whatever, this one thing was gonna magically make them have a million dollar business and they were gonna get an award on a stage and it didn't go to plan and now they're kind of completely beat down.
1009
00:46:49.161 --> 00:46:50.262
It's an interesting perspective.
1010
00:46:50.382 --> 00:46:58.004
Because if you look at a lot of the YouTube channels that get really big, they end up going after the business opportunity crowd.
1011
00:46:58.244 --> 00:46:59.825
Like most of them do.
1012
00:47:00.685 --> 00:47:07.688
For example, if I were to go just after the start a new idea business opportunity crowd, the channel would really...
1013
00:47:08.468 --> 00:47:11.593
grow, but that's not really a great client most of the time.
1014
00:47:11.613 --> 00:47:22.929
And so back to this idea of selling the idea of building, buying a business, like that's a small subset of people you need to get to that are wired to do such a thing versus the business opportunity crowd.
1015
00:47:23.130 --> 00:47:23.310
Yeah.
1016
00:47:23.470 --> 00:47:26.933
I suspect the real business there on those is selling information.
1017
00:47:27.213 --> 00:47:28.975
Oh yeah, 100%.
1018
00:47:29.015 --> 00:47:33.238
It's like 98% of the people are just buying information with the dream and they'll never do anything with it.
1019
00:47:33.518 --> 00:47:39.483
And then the filter is some number of people join the mastermind group and that group are the serious people that could actually buy something.
1020
00:47:39.703 --> 00:47:39.884
Yeah.
1021
00:47:39.924 --> 00:47:41.205
That's what the real business is.
1022
00:47:41.405 --> 00:47:42.366
And then they sell deal flow.
1023
00:47:42.606 --> 00:47:43.967
Yeah, exactly, yeah.
1024
00:47:44.207 --> 00:47:44.467
All right.
1025
00:47:44.888 --> 00:47:54.877
Next on the docket that I wanted to talk about is right now, in fact, as of today, which it's June 10th, we got a report that inflation is up.
1026
00:47:55.378 --> 00:47:59.381
And so kind of how do you think about this in terms of what is higher?
1027
00:47:59.501 --> 00:48:00.783
So let me frame this.
1028
00:48:00.863 --> 00:48:03.886
If inflation's up, then that means the Fed is.
1029
00:48:04.446 --> 00:48:06.207
isn't going to be bringing down new rates.
1030
00:48:06.267 --> 00:48:11.950
And there was a theory that Kevin Walsh, who's the new Fed chair, wasn't going to bring down rates anyway, anytime real soon.
1031
00:48:12.110 --> 00:48:13.311
Like there's kind of debatable.
1032
00:48:13.331 --> 00:48:14.511
I know Trump wants to bring them down.
1033
00:48:15.292 --> 00:48:19.934
So let's just assume with inflation numbers up, the rates have to stay up.
1034
00:48:19.974 --> 00:48:21.195
We can't do a rate cut.
1035
00:48:21.315 --> 00:48:24.217
What does this mean to our businesses?
1036
00:48:24.337 --> 00:48:26.298
You know, I think about what's it mean for housing?
1037
00:48:26.338 --> 00:48:29.539
What's it mean for the consumer's mindset, things like that?
1038
00:48:29.599 --> 00:48:30.600
How do you look at this stuff?
1039
00:48:31.225 --> 00:48:36.450
Yeah, for someone listening that might not know, interest rates, inflation, etc.
1040
00:48:36.470 --> 00:48:43.517
So generally, higher interest rates should slow down the economy because it's harder to borrow money.
1041
00:48:43.678 --> 00:48:44.618
It's hard to take risk.
1042
00:48:44.719 --> 00:48:45.960
It's hard to invest into your business.
1043
00:48:46.340 --> 00:48:48.522
And by doing that, we should bring down inflation.
1044
00:48:49.183 --> 00:48:51.684
Because inflation typically is inverse of this thing.
1045
00:48:52.124 --> 00:48:58.847
But what everyone's afraid of right now or what we're at risk of right now is high inflation with high interest rates.
1046
00:48:59.267 --> 00:49:00.928
And this is something called stagflation.
1047
00:49:01.828 --> 00:49:10.212
And the reason it's actually become so perilous or it's kind of some of the cold open is like the national debt being so high –
1048
00:49:11.072 --> 00:49:18.918
every single interest point that we are moving up, we are just eating so much of interest of the, or so much of the budget is going toward just interest payments.
1049
00:49:19.579 --> 00:49:34.751
And so the kind of philosophy the past several years has been we will have to just grow our way out of the debt, which is, hey, if we can grow the economy at 4%, 5%, 6%, we can eventually just make this thing, this huge $39 trillion go away.
1050
00:49:34.911 --> 00:49:36.353
Kind of like what happened after World War II.
1051
00:49:36.393 --> 00:49:38.554
If you look at the, I believe it was,
1052
00:49:39.415 --> 00:49:44.680
A few years right after World War II, the GDP to debt ratio is actually higher than it is today.
1053
00:49:45.821 --> 00:49:50.506
But we were just keep – there's this boom, everyone back to work, and we were able to outgrow it.
1054
00:49:51.447 --> 00:49:52.788
And that should work in theory.
1055
00:49:53.809 --> 00:49:59.794
I kind of look back to 2007, 2008, and I think when it comes to home services, when there's an economic –
1056
00:50:00.475 --> 00:50:00.835
trouble.
1057
00:50:01.216 --> 00:50:03.938
And if we hit stagflation, that's when we can start having trouble.
1058
00:50:05.079 --> 00:50:08.041
I think maintain versus upgrade is the thing that kind of goes through my mind.
1059
00:50:08.522 --> 00:50:14.086
And so like in 2007, 2008, when it came to new car sales, they were down 40% in 2008.
1060
00:50:14.506 --> 00:50:18.129
But then for maintenance of used vehicles, it was only down 1%.
1061
00:50:19.130 --> 00:50:21.570
In other words, people were maintaining instead of upgrading.
1062
00:50:22.451 --> 00:50:24.311
And so I think the same thing's happening with houses right now.
1063
00:50:24.531 --> 00:50:29.372
Like the mindset of the owner is, I'm going to upgrade, I'm going to add, I'm going to remodel.
1064
00:50:29.852 --> 00:50:33.873
Instead of go buy a new one, add a pergola in the backyard.
1065
00:50:34.113 --> 00:50:37.213
There's less of those and more of I will maintain what I currently have.
1066
00:50:37.693 --> 00:50:44.874
And a lot of that is because we have 30-year fixed mortgages and people are in 2.5%, 3% interest rates on their mortgage.
1067
00:50:45.054 --> 00:50:46.395
And if they move, they got to go to 5.5%, 6%, 7%.
1068
00:50:48.495 --> 00:50:48.956
interest rates.
1069
00:50:49.216 --> 00:50:53.321
And what's interesting is the US is the only place that that really even exists.
1070
00:50:53.341 --> 00:50:58.367
This whole lock-in effect that we're having right now, if you go to Canada, you don't have 30-year fixed mortgage.
1071
00:50:58.747 --> 00:51:02.151
Over in New Zealand right now, they're having a huge problem with real estate coming down.
1072
00:51:02.171 --> 00:51:02.952
And it's because...
1073
00:51:03.733 --> 00:51:10.055
three, four, five years, then you got to go refinance or you've got to, uh, it's a variable interest rate mortgage.
1074
00:51:10.515 --> 00:51:17.938
And so it's very interesting where we had this massive decline in interest rates, people locked in and now they don't want to sell because they got to go get a loan.
1075
00:51:17.958 --> 00:51:20.619
That's going to cost them an extra five grand a month in interest.
1076
00:51:20.999 --> 00:51:26.001
And so they don't, they do not sell and move, but they're, they have gained wealth.
1077
00:51:26.421 --> 00:51:33.904
They have a bunch of equity in their house now, and they're more likely to do the maintenance, the additions, the upgrades to their existing house instead of moving.
1078
00:51:34.264 --> 00:51:44.269
And so I find it very interesting to try to tap into that market versus going after the person that usually is like, hey, I want a brand new landscape versus the person who's like, hey, I just want to add a little bit more over here.
1079
00:51:44.289 --> 00:51:51.932
I want to update this and kind of piecemeal a smaller budget item into an existing property they already have.
1080
00:51:52.232 --> 00:51:52.833
I'd agree with it.
1081
00:51:52.853 --> 00:52:04.963
We've kind of talked about this before and I brought it back up because now we're seeing new data or maybe a continuation of data we've been seeing for a bit that just makes it look like this is probably what the future looks like for some time to come.
1082
00:52:05.043 --> 00:52:09.807
I don't know how you would predict when rates are going to come back down and things are going to change.
1083
00:52:09.827 --> 00:52:10.428
Yeah.
1084
00:52:11.688 --> 00:52:14.129
there's a part of me that thinks the rates.
1085
00:52:14.609 --> 00:52:16.350
So here's the way I think about this.
1086
00:52:16.370 --> 00:52:27.113
So one negative of the rates, people not moving, is it then makes it harder for me to go get, on one hand, get new clients because they're not turning the home.
1087
00:52:27.194 --> 00:52:28.654
So they're not shopping as much.
1088
00:52:29.014 --> 00:52:30.115
So a little less lead flow.
1089
00:52:30.175 --> 00:52:31.015
On the other hand,
1090
00:52:31.595 --> 00:52:33.576
there's an argument that, well, they're turning less.
1091
00:52:33.616 --> 00:52:35.138
And so they're staying with me longer.
1092
00:52:35.158 --> 00:52:36.979
And so I have lower churn.
1093
00:52:37.059 --> 00:52:38.100
So like, which is better?
1094
00:52:38.460 --> 00:52:45.045
So my general theory is if you're a smaller company, the homeowner not moving is not as good for you.
1095
00:52:45.265 --> 00:52:49.168
If you're a really big company, the homeowner not moving might be better for you.
1096
00:52:49.348 --> 00:52:49.768
I don't know.
1097
00:52:50.349 --> 00:52:51.830
That's kind of how I think about this.
1098
00:52:52.510 --> 00:53:00.676
And so I just feel like this higher rates, homes not selling is just going to be the way it is for quite some time to come.
1099
00:53:01.196 --> 00:53:03.297
And I go back to something we've already talked about.
1100
00:53:03.337 --> 00:53:13.484
And that is, I think what's happening in the market where people just, I mean, everybody I talk to, like companies are growing, but they're not growing to expectations.
1101
00:53:13.524 --> 00:53:14.125
Like some are.
1102
00:53:14.944 --> 00:53:15.764
but a lot of them aren't.
1103
00:53:15.864 --> 00:53:19.045
And they're spending pretty significant amounts of money still marketing.
1104
00:53:19.285 --> 00:53:21.866
It's just like the quality of leads are lower, the lead flows lower.
1105
00:53:21.886 --> 00:53:23.086
A lot of people are seeing that.
1106
00:53:24.247 --> 00:53:27.848
A lot of people across a lot of different businesses I talked to are seeing that thing.
1107
00:53:28.288 --> 00:53:34.630
And so I tend to think the biggest challenge we're seeing right now is just general nervousness in the consumer.
1108
00:53:34.670 --> 00:53:41.712
This general, like between the Iran war and fuel and oil and all these other, and all the negative stuff that are in the news.
1109
00:53:41.752 --> 00:53:43.192
Again, all stuff we've talked about
1110
00:53:43.532 --> 00:53:46.454
I think that's to a large degree what's going on right now.
1111
00:53:46.515 --> 00:53:47.996
And I just think it's going to continue.
1112
00:53:48.176 --> 00:53:52.680
I don't know what's going to have to happen anytime soon for that narrative to change.
1113
00:53:53.260 --> 00:53:54.221
Where do you stand on that?
1114
00:53:54.501 --> 00:53:59.145
Yeah, like I don't like to talk about it because it seems like I'm talking about a gust a lot.
1115
00:53:59.225 --> 00:54:03.769
But like it is so interesting to compare that data versus what we see at home service web design.
1116
00:54:03.829 --> 00:54:04.469
It's incredible.
1117
00:54:05.890 --> 00:54:12.235
But I will say we've seen the lowest churn this year and the least people leaving over price increases.
1118
00:54:13.008 --> 00:54:17.390
It's like, I just was, someone raised their prices and 150 customers lost two people.
1119
00:54:18.110 --> 00:54:19.651
And he's raised prices last year.
1120
00:54:20.071 --> 00:54:20.772
He's in profit mode.
1121
00:54:21.012 --> 00:54:24.473
I think to your point, people with equity in their house aren't moving.
1122
00:54:24.733 --> 00:54:25.734
And I think that's an opportunity.
1123
00:54:25.894 --> 00:54:27.615
And we got, a lot of us got very,
1124
00:54:28.335 --> 00:54:34.457
lazy selling to new homeowners or people who had just moved in 2020, 2021, 2022, when everyone was moving.
1125
00:54:34.957 --> 00:54:38.818
The way to get a lead was to market to someone that just moved into their house.
1126
00:54:39.258 --> 00:54:40.498
Yep, they're all looking on Google.
1127
00:54:40.659 --> 00:54:49.641
Yep, and now we've got a great video the other day speaking to the pain of the customer and that usually revolves around their unreliability of their service provider.
1128
00:54:50.101 --> 00:54:55.843
And if you're able to deliver on that aspect, you can take the customer from the person that is doing a poor job.
1129
00:54:56.803 --> 00:55:00.545
And so I think shifting marketing to that is the move.
1130
00:55:01.305 --> 00:55:02.206
That is my belief.
1131
00:55:02.586 --> 00:55:05.007
That is a perfect way to encapsulate my view.
1132
00:55:05.167 --> 00:55:07.308
And I think it's going to persist for a while.
1133
00:55:07.649 --> 00:55:07.869
Yeah.
1134
00:55:08.029 --> 00:55:14.832
Because like 2020, 2021, 2022, everyone was getting leads, but no one was distinguishing where these leads come.
1135
00:55:14.872 --> 00:55:15.753
It's either new homeowner.
1136
00:55:15.933 --> 00:55:20.555
It's really only two times you get a home service provider.
1137
00:55:20.915 --> 00:55:22.016
It's I moved.
1138
00:55:22.556 --> 00:55:25.098
That's like a very peak time to be able to get the customer.
1139
00:55:25.618 --> 00:55:28.120
And second is I'm unhappy with my current provider.
1140
00:55:28.500 --> 00:55:33.064
Everyone was getting these people because people were so transit and like moving so much.
1141
00:55:33.084 --> 00:55:35.986
And our churn was through the roof because people were just moving.
1142
00:55:36.606 --> 00:55:37.687
It's not happening anymore.
1143
00:55:37.747 --> 00:55:38.728
Our churn is down.
1144
00:55:39.248 --> 00:55:44.312
And the only way to get customer now is to shift our marketing towards going after customers that already have a provider.
1145
00:55:44.352 --> 00:55:47.374
So instead of, instead of saying, Hey, save your weekend, I'm going to, I'm going to
1146
00:55:47.734 --> 00:55:48.856
They already have a provider.
1147
00:55:49.136 --> 00:55:52.020
Like they don't need to worry about saving time on the weekend.
1148
00:55:52.040 --> 00:55:52.941
They already have someone.
1149
00:55:52.961 --> 00:55:54.143
You've got to convince them to switch.
1150
00:55:54.724 --> 00:56:01.453
And the way to speak to that pain is very different than I'm going to save you time or, you know, we're going to show up in professional service.
1151
00:56:01.473 --> 00:56:02.775
They already have a service.
1152
00:56:02.935 --> 00:56:04.436
I think a lot of people have missed that shift.
1153
00:56:04.536 --> 00:56:19.002
And so because of that, their marketing isn't working, but it's because your marketing is a 2020 to 2023 client that just moved and is looking for a new provider, not the person that's had service for 20 years and needs a better person because the other person stops showing up.
1154
00:56:19.323 --> 00:56:20.023
I agree with all that.
1155
00:56:21.088 --> 00:56:21.908
I don't have much to add.
1156
00:56:21.928 --> 00:56:22.469
I agree with that.
1157
00:56:22.589 --> 00:56:24.149
I have a proposed solution.
1158
00:56:24.249 --> 00:56:27.751
I think this is a proposed solution for all this problem with the housing market, okay?
1159
00:56:28.251 --> 00:56:28.531
Okay.
1160
00:56:28.731 --> 00:56:28.931
Okay.
1161
00:56:29.411 --> 00:56:34.574
Now, I think it would not be good long-term, but I think if the short-term, everyone would like it.
1162
00:56:35.174 --> 00:56:38.995
Now, that's how the United States, we are great for that, right?
1163
00:56:39.055 --> 00:56:41.496
Short-term gain, long-term, we'll pay for it down somewhere on the road.
1164
00:56:41.717 --> 00:56:42.177
Hear me out.
1165
00:56:42.817 --> 00:56:44.138
I feel like this could get passed, too.
1166
00:56:44.758 --> 00:56:47.579
What do you think about portable mortgages to solve this?
1167
00:56:47.619 --> 00:56:48.539
This is a conversation.
1168
00:56:48.819 --> 00:56:49.040
Yeah.
1169
00:56:49.420 --> 00:56:49.980
Like- Yeah.
1170
00:56:50.140 --> 00:56:52.662
I think in the short term, it would be a boom.
1171
00:56:53.303 --> 00:56:56.806
In the long run, it would make housing costs go through the roof.
1172
00:56:56.906 --> 00:57:06.154
Because if you could port your mortgage over, now the likelihood that people can move now would go – like you'd have so many buyers.
1173
00:57:06.735 --> 00:57:09.177
Which would run up demand, which would run up housing prices.
1174
00:57:10.037 --> 00:57:12.238
I guess you could argue then that people would be moving.
1175
00:57:12.258 --> 00:57:13.578
So there'd be more sellers in the market.
1176
00:57:13.618 --> 00:57:16.919
But even then, like, yeah, that would be a boom for home services.
1177
00:57:16.939 --> 00:57:18.819
That would be the dream for home services right there.
1178
00:57:18.939 --> 00:57:20.079
That is an argument.
1179
00:57:20.099 --> 00:57:27.681
Like you don't know how much supply will come into the market when people are like, okay, I want to move, but I can't because I got a 3% rate and it's now 6.2.
1180
00:57:27.901 --> 00:57:28.641
That kind of a thing.
1181
00:57:29.021 --> 00:57:29.201
Yes.
1182
00:57:29.221 --> 00:57:31.342
I don't know if you'd find equilibrium or if it.
1183
00:57:31.602 --> 00:57:41.708
Like the difference of someone buying a house four years ago, five years ago, it's almost like if you got that 30-year token and you get a portable mortgage, that set you up for the future.
1184
00:57:42.048 --> 00:57:44.330
What if... How is it?
1185
00:57:44.350 --> 00:57:45.331
I think this would get votes.
1186
00:57:45.371 --> 00:57:46.071
That's what I'm saying.
1187
00:57:46.631 --> 00:57:49.193
I know I've heard people talking about this.
1188
00:57:49.353 --> 00:57:52.415
If someone proposed this, anyone that owned a house would want it.
1189
00:57:53.055 --> 00:57:56.177
I will say, though, that anyone that doesn't own a house is really toast.
1190
00:57:56.537 --> 00:57:58.038
So I would think it would rate...
1191
00:57:59.199 --> 00:58:00.380
I have not thought about this at all.
1192
00:58:00.700 --> 00:58:13.928
But wouldn't it need... One of the challenges is, is the whole idea that I can give you a 3% loan or 3% rate because I know the data and the data says on average, you're going to be out of that house in 6.5 years.
1193
00:58:14.308 --> 00:58:16.329
So I don't have a long risk curve.
1194
00:58:16.689 --> 00:58:17.229
I don't have...
1195
00:58:17.390 --> 00:58:21.432
So when I was selling you that deal at 3%, it was never based on 30%.
1196
00:58:21.552 --> 00:58:22.953
It was based on the fact that
1197
00:58:23.593 --> 00:58:26.515
on average, everybody's out in six and a half years.
1198
00:58:26.735 --> 00:58:28.137
I got some people that are out in 30.
1199
00:58:28.397 --> 00:58:29.678
I got some people that are out in two.
1200
00:58:30.538 --> 00:58:32.060
But on average, it's six and a half.
1201
00:58:32.080 --> 00:58:35.422
So I got to carry that debt on my books for six and a half years on the average.
1202
00:58:35.682 --> 00:58:36.663
So I can give you three.
1203
00:58:37.103 --> 00:58:40.946
If now the new data set is, I got to hold this for 30.
1204
00:58:41.046 --> 00:58:43.608
I don't know what the world looks like in 30.
1205
00:58:43.688 --> 00:58:45.790
Do I ever even offer you a 3%?
1206
00:58:45.890 --> 00:58:46.530
I don't know.
1207
00:58:46.871 --> 00:58:48.892
That's just a question that just now came to my mind.
1208
00:58:48.912 --> 00:58:49.853
I don't know how that works.
1209
00:58:50.053 --> 00:58:53.316
the interest rates would go up to existing or to new mortgages.
1210
00:58:54.157 --> 00:59:01.985
But my question, that's why I'm saying, I think the cost would go through the roof, but then to existing homeowners, they'd be all over it.
1211
00:59:02.285 --> 00:59:05.328
But they'd also vote that in because their equity would go through the roof.
1212
00:59:05.548 --> 00:59:05.848
Yeah.
1213
00:59:06.329 --> 00:59:07.490
That's, I don't know, man.
1214
00:59:07.510 --> 00:59:10.072
I don't know how to predict how that somebody knows how this would play out.
1215
00:59:10.112 --> 00:59:11.273
I don't know how it would play out.
1216
00:59:11.734 --> 00:59:14.817
It's very fascinating, like thought exercise though.
1217
00:59:15.462 --> 00:59:17.023
The whole subject, too, is one thing.
1218
00:59:17.043 --> 00:59:18.984
You sell the property and they take over the mortgage.
1219
00:59:19.484 --> 00:59:22.326
Technically not usually feasible, but that's one part.
1220
00:59:22.346 --> 00:59:25.587
But can I sell my house, take my mortgage, and go someplace else?
1221
00:59:25.727 --> 00:59:26.188
I'm with you.
1222
00:59:26.428 --> 00:59:32.951
Like, man, I feel like that's something I think would be bad long-term for the economy and for especially young homeowners.
1223
00:59:33.431 --> 00:59:36.893
I think it'd be bad for us in 20 years, but I think it would get votes.
1224
00:59:37.093 --> 00:59:40.655
And I think a politician could get voted in if they're able to push that through.
1225
00:59:40.995 --> 00:59:42.416
But I also think the banks are against it.
1226
00:59:42.896 --> 00:59:43.416
To your point.
1227
00:59:43.456 --> 00:59:43.716
Okay.
1228
00:59:43.736 --> 00:59:45.017
Because now they got...
1229
00:59:45.037 --> 00:59:45.697
They had risk.
1230
00:59:45.757 --> 00:59:46.037
Yeah.
1231
00:59:46.237 --> 00:59:46.857
Massive risk.
1232
00:59:46.877 --> 00:59:47.158
Huge.
1233
00:59:47.338 --> 00:59:54.180
But I could also see that being an argument that once again, here's all the older people kicking the young people in the face.
1234
00:59:54.420 --> 00:59:54.800
Oh, yeah.
1235
00:59:54.840 --> 00:59:55.040
Yeah.
1236
00:59:55.100 --> 00:59:55.641
To the voters.
1237
00:59:55.661 --> 00:59:56.881
More advantage to every... Yeah.
1238
00:59:57.321 --> 00:59:57.781
Exactly.
1239
00:59:57.861 --> 00:59:58.842
Very interesting idea.
1240
00:59:59.482 --> 01:00:01.703
Again, I'd heard it, but I'd never given it any thought.
1241
01:00:01.723 --> 01:00:01.883
Yeah.
1242
01:00:02.073 --> 01:00:03.355
Yeah, I think about this a lot.
1243
01:00:03.375 --> 01:00:08.903
I've actually kept my pulse on it because if it ever got through, I think this would lead to a really big boom.
1244
01:00:09.584 --> 01:00:13.069
And if anyone's going to do it, it's Trump because he loves real estate.
1245
01:00:13.109 --> 01:00:15.532
And they got him in his pocket.
1246
01:00:16.113 --> 01:00:16.914
He's in their pocket.
1247
01:00:16.934 --> 01:00:17.375
Yeah.
1248
01:00:17.655 --> 01:00:17.835
Hmm.
1249
01:00:18.135 --> 01:00:20.297
So if that trade's going to happen, what do you go buy?
1250
01:00:20.317 --> 01:00:22.318
Because you can't buy up houses fast enough.
1251
01:00:22.338 --> 01:00:24.920
So you got to go buy REITs or you got to buy some, I guess, BlackRock.
1252
01:00:24.940 --> 01:00:25.300
I don't know.
1253
01:00:25.360 --> 01:00:26.161
You buy something.
1254
01:00:26.181 --> 01:00:27.802
There's a way you trade that.
1255
01:00:27.822 --> 01:00:28.642
I don't know how you trade it.
1256
01:00:28.702 --> 01:00:30.364
I start talking about one-time projects.
1257
01:00:30.444 --> 01:00:32.565
Well, that's it.
1258
01:00:32.745 --> 01:00:34.086
That's in the business.
1259
01:00:34.146 --> 01:00:34.827
Yeah.
1260
01:00:34.847 --> 01:00:38.669
But my brain goes to like, how do you invest capital to be ahead of that trade?
1261
01:00:38.689 --> 01:00:38.889
Yeah.
1262
01:00:40.130 --> 01:00:41.110
Anyway, that's interesting.
1263
01:00:41.190 --> 01:00:41.451
All right.
1264
01:00:41.771 --> 01:00:46.332
So another item I had on the docket was after the hot takes that we did.
1265
01:00:46.832 --> 01:00:51.814
We had a couple votes or some number of votes for a few of the hot take items.
1266
01:00:51.874 --> 01:01:01.237
And one of them, I think the one that got the most, again, not a big number, I thought we'd talk about it, was my statement that the right business partner is a major competitive advantage.
1267
01:01:01.257 --> 01:01:01.417
Mm-hmm.
1268
01:01:01.937 --> 01:01:11.404
And the reason why I thought it was a hot take was simply that I think that a lot of people say business partners are bad and a lot of people feel that business partners are bad.
1269
01:01:11.764 --> 01:01:17.268
And so and I, I don't know where you'll fall on this, but I kind of feel like you're in the camp of no business partner.
1270
01:01:17.288 --> 01:01:18.049
I don't know.
1271
01:01:18.089 --> 01:01:18.329
Yeah.
1272
01:01:18.349 --> 01:01:19.810
So kind of how would you think about this?
1273
01:01:20.231 --> 01:01:20.511
Oh, yeah.
1274
01:01:20.551 --> 01:01:21.152
Okay.
1275
01:01:21.172 --> 01:01:22.392
So it's tough.
1276
01:01:22.432 --> 01:01:25.394
It's kind of like saying I have had a really great experience with marriage.
1277
01:01:25.734 --> 01:01:28.055
And I would say, I don't want to speak on your behalf, but I think you have too.
1278
01:01:28.095 --> 01:01:30.176
And you would encourage people to get married.
1279
01:01:30.557 --> 01:01:32.118
Back to our earlier cold open.
1280
01:01:32.378 --> 01:01:39.381
I think on the other side, I see people get married and it leads to years and years of hurt because they chose the wrong person.
1281
01:01:39.702 --> 01:01:40.762
They didn't go into it correctly.
1282
01:01:40.782 --> 01:01:42.443
There was an expectation set correctly.
1283
01:01:42.943 --> 01:01:49.027
And so it's difficult to make statements like everyone should get married when I know that half of them are going to lead to turmoil, heartache.
1284
01:01:49.647 --> 01:01:52.749
years of pain and separation, like really bad stuff.
1285
01:01:53.389 --> 01:01:56.111
And so that's why I'm pretty quiet on it.
1286
01:01:56.251 --> 01:01:56.952
I agree with you.
1287
01:01:56.992 --> 01:02:01.975
Like having a business partnership is an absolute competitive advantage if it works.
1288
01:02:02.763 --> 01:02:06.584
It's the same way that a marriage is a competitive advantage in life if it works.
1289
01:02:06.624 --> 01:02:07.144
If it works.
1290
01:02:07.404 --> 01:02:20.366
And it's just, it's the math part that I have a hard time quantifying and being prescriptive because if I say something like everyone should get married, well, then 50% of people are set up for failure, just mathematically.
1291
01:02:20.707 --> 01:02:22.447
And if I say, hey, everyone should go get business partnerships.
1292
01:02:22.487 --> 01:02:22.807
I don't know.
1293
01:02:22.927 --> 01:02:24.387
I don't know what the math is.
1294
01:02:24.427 --> 01:02:24.647
70, 80%.
1295
01:02:24.747 --> 01:02:25.087
I don't know.
1296
01:02:25.147 --> 01:02:25.748
Don't work out.
1297
01:02:26.288 --> 01:02:27.248
They're all going to fail too.
1298
01:02:27.268 --> 01:02:27.368
Yeah.
1299
01:02:28.148 --> 01:02:32.331
But I think for the ends of the curve, that's really where partnerships sit.
1300
01:02:32.391 --> 01:02:34.553
So I kind of think of it like, I don't know if I could draw this.
1301
01:02:35.494 --> 01:02:41.999
If you look at like all businesses, I would say like these over here, like the worst ones that end really, really bad, probably partnership.
1302
01:02:42.259 --> 01:02:42.940
The ones that are over here,
1303
01:02:43.580 --> 01:02:44.460
Probably a partnership.
1304
01:02:45.141 --> 01:02:47.482
And there's this risk of being over here.
1305
01:02:47.922 --> 01:02:53.625
But if you look at like startups, venture capital, private equity, they like require multiple founders.
1306
01:02:54.005 --> 01:02:55.385
They don't even allow solo founders.
1307
01:02:55.625 --> 01:02:58.207
And I think it's because they're going after this over here.
1308
01:02:59.667 --> 01:03:02.028
But you have a lot of experience with it going well.
1309
01:03:02.709 --> 01:03:07.171
And so from your perspective- Yeah, I've got a couple where it didn't go well as well.
1310
01:03:07.351 --> 01:03:08.651
So I've got both sides of it.
1311
01:03:09.592 --> 01:03:11.633
My brain on this topic goes straight to the-
1312
01:03:12.413 --> 01:03:13.513
the marriage thing as well.
1313
01:03:13.533 --> 01:03:14.574
It's like, to me, it's the best.
1314
01:03:14.774 --> 01:03:20.275
Like somebody would say, I have this theory, but I tried to do some research on this theory and I couldn't prove it.
1315
01:03:21.116 --> 01:03:22.876
But I'm going to go ahead and state my theory.
1316
01:03:22.956 --> 01:03:23.196
Okay.
1317
01:03:23.777 --> 01:03:30.158
If you want to quantify what's more destructive from a financial standpoint, for an entrepreneur, so let's say you've decided to be an entrepreneur.
1318
01:03:30.178 --> 01:03:31.439
Okay, you're an entrepreneur.
1319
01:03:31.459 --> 01:03:32.139
That's who you have to be.
1320
01:03:32.159 --> 01:03:33.259
It means you have to build things.
1321
01:03:33.820 --> 01:03:34.840
What's more destructive?
1322
01:03:35.080 --> 01:03:41.022
Having one of the businesses or a business partnership fail and it dissolves that business.
1323
01:03:41.942 --> 01:03:44.685
Or you get a divorce and you lose half your wealth.
1324
01:03:44.965 --> 01:03:49.969
My theory is the bigger wealth destruction is marriage than business partnerships.
1325
01:03:50.429 --> 01:03:51.510
I can't prove that though.
1326
01:03:51.530 --> 01:03:54.673
I tried that because I want to make that one of my arguments.
1327
01:03:54.913 --> 01:03:56.174
So there's this part of me.
1328
01:03:56.194 --> 01:04:00.598
It's like, okay, on one hand, we say I would never be in a business partnership.
1329
01:04:00.998 --> 01:04:04.001
Well, then I can throw all the same data at you and say, do not get married.
1330
01:04:04.642 --> 01:04:05.522
It's just as bad.
1331
01:04:05.863 --> 01:04:06.043
Yeah.
1332
01:04:06.792 --> 01:04:08.292
But most people are going to get married.
1333
01:04:08.432 --> 01:04:08.632
Yeah.
1334
01:04:09.753 --> 01:04:12.973
It's like, not in 20 years, not in 20 years, not 20 years.
1335
01:04:13.193 --> 01:04:20.474
But, and so, so my argument is, okay, why would you say, well, no, no, no, I'm still going to get married, which I'm an advocate for.
1336
01:04:20.795 --> 01:04:23.455
Well, because you're going to put a lot of thought and effort into it.
1337
01:04:23.475 --> 01:04:24.875
You're going to try to do it differently.
1338
01:04:24.895 --> 01:04:25.755
And you're going to be thought about it.
1339
01:04:25.775 --> 01:04:28.396
You're going to spend some time before you jump into getting married.
1340
01:04:28.416 --> 01:04:33.557
Like there's, you're going to put in maybe, maybe the argument, maybe it's not black and white.
1341
01:04:33.897 --> 01:04:34.057
Like,
1342
01:04:34.877 --> 01:04:40.220
Well, somebody commented in the comments about Dave Ramsey being very negative on partnerships.
1343
01:04:40.521 --> 01:04:42.522
The only ship that doesn't sail is a partnership.
1344
01:04:43.002 --> 01:04:43.322
Yeah.
1345
01:04:43.422 --> 01:04:46.564
And so I went and did a little Googling because I didn't know what his position was.
1346
01:04:46.584 --> 01:04:48.225
I didn't know that actually was his position.
1347
01:04:48.605 --> 01:04:50.747
So then I found another quote by him, whether or not it's right or not.
1348
01:04:50.787 --> 01:04:57.631
It's like he was quoting like 70% of businesses fail due to partnerships or 70% of partnerships fail.
1349
01:04:57.851 --> 01:04:57.951
Okay.
1350
01:04:57.971 --> 01:04:58.111
Okay.
1351
01:04:58.391 --> 01:05:00.753
So I did a little research on that.
1352
01:05:00.933 --> 01:05:12.644
And the best I can tell, and my data is going to be kind of wrong, if you take the startup phase out of it and you just say it actually ended because of the partnership, the data might be closer to 30%.
1353
01:05:13.285 --> 01:05:15.327
Yes, lots of partnerships fell.
1354
01:05:15.867 --> 01:05:18.088
but did they fail because they were a partnership?
1355
01:05:18.148 --> 01:05:18.368
True.
1356
01:05:18.589 --> 01:05:21.590
Or did they fail because they're a business and most businesses fail?
1357
01:05:21.790 --> 01:05:26.873
And is the partner an easy scapegoat as to why the business failed instead of just saying, I stink?
1358
01:05:27.114 --> 01:05:27.814
Yeah, yeah.
1359
01:05:27.874 --> 01:05:31.376
So I just, so I, I'm, oh, another interesting thing.
1360
01:05:31.816 --> 01:05:39.181
I could have never articulated this, but I had to go look this stuff up to be able to talk about this today because I've just, I've had positive and negative experiences.
1361
01:05:39.721 --> 01:05:44.224
And my positive experiences have outweighed my negative experiences, but I can give you pros and cons.
1362
01:05:44.264 --> 01:05:44.364
Yeah.
1363
01:05:45.204 --> 01:05:48.346
Um, interesting study from Harvard, 30%.
1364
01:05:48.486 --> 01:05:53.288
Uh, there's a 30% pop in successful exits.
1365
01:05:53.349 --> 01:05:55.770
If you're a partnership, which is kind of similar to data you said.
1366
01:05:56.190 --> 01:06:01.413
So, uh, it's a very meaningful difference to actually selling a company in the future.
1367
01:06:01.533 --> 01:06:07.036
Valuation partner with a 30% is that valuation actually ever even getting to the chance to exit your business.
1368
01:06:07.551 --> 01:06:08.092
Oh, I see.
1369
01:06:08.132 --> 01:06:11.255
So likelihood of an exit, 30% higher.
1370
01:06:11.355 --> 01:06:13.597
It's 30% higher if you're a partnership.
1371
01:06:13.657 --> 01:06:17.721
Do you feel like part of it, like when I look over on this side of the graph, it's like all the good things.
1372
01:06:17.941 --> 01:06:24.248
Do you think the part of it that's so beneficial is that when one person is down, it's unlikely that both of you people are down?
1373
01:06:24.588 --> 01:06:26.969
Yeah, I actually thought about a couple of things.
1374
01:06:27.009 --> 01:06:30.529
I think, you know, here's where a partnership would not be the best partnership.
1375
01:06:30.569 --> 01:06:31.930
It could work, but it may not be the best.
1376
01:06:32.250 --> 01:06:35.651
If you're the exact same person with the exact same skillset, doing the exact same thing.
1377
01:06:35.671 --> 01:06:38.251
Okay, it's like, what if you's not that important to the business?
1378
01:06:38.811 --> 01:06:39.852
I mean, but that could still work.
1379
01:06:39.872 --> 01:06:41.372
You might just run double as quick.
1380
01:06:42.132 --> 01:06:52.815
But, you know, in a lot of cases, if you're both, like a great partnership would be one person is sales and marketing focused and another person is operational focused and they love those things.
1381
01:06:52.835 --> 01:06:53.975
That's a good partnership.
1382
01:06:54.775 --> 01:06:57.197
Those have been my stronger partnerships.
1383
01:06:57.217 --> 01:07:01.420
Like with John and I, I was technical, but John was really technical.
1384
01:07:01.600 --> 01:07:02.581
He was our CTO.
1385
01:07:02.761 --> 01:07:04.803
I'm the sales and marketing guy.
1386
01:07:05.223 --> 01:07:07.105
Like I'm the guy that's willing to get on stage.
1387
01:07:07.545 --> 01:07:08.946
So that was a great partnership.
1388
01:07:09.146 --> 01:07:10.467
I could just think about growing.
1389
01:07:10.707 --> 01:07:11.888
John could think about security.
1390
01:07:12.849 --> 01:07:14.631
Really valuable, you know, that kind of thing.
1391
01:07:15.011 --> 01:07:23.677
And so, you know, one to, I'll give pros to your point here, but one example is if you're the same person,
1392
01:07:24.498 --> 01:07:30.202
then you don't get the benefit of maybe the opposite person pushing.
1393
01:07:30.302 --> 01:07:31.442
So I think about pushback.
1394
01:07:32.343 --> 01:07:50.234
So do a lot of solo entrepreneurs hire a team member and they see that team member as a team member, really valuable and important, but they don't own this business and they devalue their pushback a little bit or they're overpowering and the team doesn't give pushback.
1395
01:07:50.554 --> 01:07:51.335
They're afraid to.
1396
01:07:52.035 --> 01:07:53.596
an owner gives pushback.
1397
01:07:53.776 --> 01:07:59.340
I suspect a lot of reasons why partners don't get along is because they don't want anybody to tell them they're wrong.
1398
01:07:59.480 --> 01:08:00.641
They don't want anybody to challenge them.
1399
01:08:00.661 --> 01:08:04.183
They don't want to have to like, so is the same reason why marriages go bad.
1400
01:08:04.503 --> 01:08:06.705
Like you're not willing to listen to the other party.
1401
01:08:06.725 --> 01:08:07.025
Mm-hmm.
1402
01:08:07.725 --> 01:08:13.787
But that's maybe one of the single most important things in a partnership is John and I could argue about stuff.
1403
01:08:14.587 --> 01:08:16.668
But we're still best friends.
1404
01:08:17.288 --> 01:08:23.190
We were company because he was my boss and I became friends with him when I was 19 to 23 working at a software company.
1405
01:08:23.890 --> 01:08:33.935
But we could push back hard on each other and argue, and he could get mad, and he could be really mad, but I knew it didn't change anything in our relationship.
1406
01:08:34.336 --> 01:08:39.298
We were going to argue our point, and eventually we were going to arrive at a quality position.
1407
01:08:39.558 --> 01:08:40.999
That's insanely valuable.
1408
01:08:42.200 --> 01:08:46.162
And so I think that's like a long point, but I think that's one of the big ones.
1409
01:08:46.734 --> 01:08:49.196
Yeah, I was even thinking like, I don't have a partner now.
1410
01:08:49.216 --> 01:08:54.200
I bought my partner out pretty early on in Copilot, now Homeworks.
1411
01:08:54.761 --> 01:09:05.450
But even last year, having where the owners now have 5% of the company, even though it's future equity that they purchased, it's still a function of, to your point, I hadn't thought about that.
1412
01:09:05.750 --> 01:09:10.434
Because now when they get mad at me, or they say something, I know they have the best interest of the business.
1413
01:09:10.714 --> 01:09:11.535
They have equity.
1414
01:09:12.035 --> 01:09:14.417
And I'm not getting rid of them and they don't want to get rid of me.
1415
01:09:14.757 --> 01:09:17.039
We're just like, we're just going to, we're going to figure it out.
1416
01:09:17.639 --> 01:09:20.942
And there's a little bit more commitment, kind of like a marriage.
1417
01:09:21.182 --> 01:09:24.465
It's like, we're in this forever and we're going to figure this out.
1418
01:09:24.625 --> 01:09:28.608
And we might butt heads, but like, there is no back door we're walking out of.
1419
01:09:28.948 --> 01:09:32.351
And I feel like in that tension is where the best decisions are made.
1420
01:09:32.968 --> 01:09:33.889
Yeah, agreed.
1421
01:09:34.329 --> 01:09:39.935
Early days of service autopilot, I'm 33 or four when I start that business.
1422
01:09:39.955 --> 01:09:40.515
I don't remember.
1423
01:09:41.336 --> 01:09:43.098
And I had done a bunch of other stuff.
1424
01:09:43.118 --> 01:09:44.019
I had a bunch of people.
1425
01:09:44.059 --> 01:09:47.002
But there was just something different about service autopilot.
1426
01:09:47.342 --> 01:09:48.723
It's like in a different way.
1427
01:09:49.044 --> 01:09:49.484
It's different.
1428
01:09:49.924 --> 01:09:51.126
Everybody's in the office.
1429
01:09:51.146 --> 01:09:52.767
They're not out in the field on trucks.
1430
01:09:52.807 --> 01:09:54.128
They're not in movie theaters.
1431
01:09:54.369 --> 01:09:55.209
It's just different.
1432
01:09:55.390 --> 01:09:55.550
Yeah.
1433
01:09:55.870 --> 01:10:07.743
And so you'd sit around this table and you've got a lot of very, very expensive people at a level I had never experienced before sitting at this table and everybody's like arguing with each other.
1434
01:10:08.144 --> 01:10:13.950
And I noticed in my, so I'm kind of a person that wants to smooth things out and bring everybody together.
1435
01:10:13.970 --> 01:10:14.731
That's how I'm built.
1436
01:10:14.931 --> 01:10:15.111
Yeah.
1437
01:10:15.792 --> 01:10:17.393
And so it really bothered me.
1438
01:10:17.513 --> 01:10:17.913
Really?
1439
01:10:17.973 --> 01:10:19.894
Yeah, it really bothered me.
1440
01:10:19.934 --> 01:10:22.035
John would get really mad about stuff.
1441
01:10:22.395 --> 01:10:23.336
And John's a great guy.
1442
01:10:23.356 --> 01:10:25.637
He's like, I'm making him sound like a bad guy.
1443
01:10:25.977 --> 01:10:28.879
John is very passionate about his thing.
1444
01:10:28.999 --> 01:10:32.340
And at first when people meet John, they may not know what to quite think of him.
1445
01:10:32.901 --> 01:10:36.483
But then when you get to know John, you're just like, here's my story about John.
1446
01:10:36.803 --> 01:10:38.323
John would come into my office all the time.
1447
01:10:38.604 --> 01:10:40.625
We need to fire this person.
1448
01:10:41.145 --> 01:10:43.426
And I'm like, okay, all right.
1449
01:10:43.546 --> 01:10:45.047
Okay, all right, I'll do it.
1450
01:10:45.327 --> 01:10:45.427
Yeah.
1451
01:10:46.023 --> 01:10:49.205
And he's like, no, no, no, no, no, no, no, no.
1452
01:10:49.225 --> 01:10:50.545
They got kids.
1453
01:10:50.625 --> 01:10:52.466
We need to talk about this.
1454
01:10:52.526 --> 01:10:55.468
That's how he's like, he would come off really fast and hard.
1455
01:10:55.888 --> 01:10:57.729
But he's like, he really cares about people.
1456
01:10:57.769 --> 01:10:58.449
He's kind of sensitive.
1457
01:10:58.469 --> 01:10:59.209
That's a perfect John.
1458
01:10:59.229 --> 01:11:02.131
So John, in the moment, we get really worked out about things.
1459
01:11:02.191 --> 01:11:06.753
And our other team, other members, again, tons of experience, very senior guys.
1460
01:11:07.733 --> 01:11:09.434
We would really listen to them.
1461
01:11:09.474 --> 01:11:10.575
We wanted to push back.
1462
01:11:11.095 --> 01:11:12.497
But it would create all this strife.
1463
01:11:12.537 --> 01:11:17.243
And so one of the big learning lessons for me was at first I wanted to smooth it all out.
1464
01:11:17.383 --> 01:11:19.225
And then I learned, oh, no, no, no, no.
1465
01:11:19.386 --> 01:11:19.546
Yeah.
1466
01:11:19.626 --> 01:11:21.208
This is where the magic happens.
1467
01:11:21.228 --> 01:11:21.649
Oh, yeah, 100%.
1468
01:11:21.949 --> 01:11:23.571
This is where the magic happens.
1469
01:11:23.851 --> 01:11:24.612
I love that, man.
1470
01:11:24.652 --> 01:11:24.792
Yeah.
1471
01:11:26.034 --> 01:11:26.915
It was not that way.
1472
01:11:26.935 --> 01:11:27.916
I did not.
1473
01:11:28.076 --> 01:11:30.918
I saw it as a negative, like, oh, we're not all getting along.
1474
01:11:30.998 --> 01:11:31.319
I don't know.
1475
01:11:31.399 --> 01:11:32.300
It bothered me.
1476
01:11:32.620 --> 01:11:33.541
Something about it bothered me.
1477
01:11:33.601 --> 01:11:35.002
But anyway, we got off topic.
1478
01:11:35.102 --> 01:11:36.083
That's so valuable.
1479
01:11:36.263 --> 01:11:36.644
Yeah.
1480
01:11:36.724 --> 01:11:38.926
And for people that are listening, like there's another level here.
1481
01:11:38.946 --> 01:11:40.907
It's like, how do you cultivate that with your team?
1482
01:11:41.007 --> 01:11:41.107
Yeah.
1483
01:11:41.128 --> 01:11:41.268
Yeah.
1484
01:11:41.788 --> 01:11:48.269
How do you give your team, like, this is where it's really risky to shut people down when they express ideas.
1485
01:11:48.349 --> 01:11:51.390
Or you can do it in so many subtle ways.
1486
01:11:52.130 --> 01:11:53.511
How do you not shut people down?
1487
01:11:53.531 --> 01:11:56.011
Because if you shut them down a couple times, you'll quit getting the ideas.
1488
01:11:56.531 --> 01:12:00.312
And so this is like, so that's one of the things I love about a partnership.
1489
01:12:00.792 --> 01:12:01.752
I'll give you another one.
1490
01:12:02.812 --> 01:12:04.493
I think it brings a level of accountability.
1491
01:12:05.033 --> 01:12:05.193
Yeah.
1492
01:12:05.473 --> 01:12:11.857
If you have mutual respect, much like in a marriage, like all you could, if you don't have respect in a marriage, then you don't care about accountability.
1493
01:12:11.877 --> 01:12:20.443
But if you have respect with your business partner, like if I'm slacking, then that's hurting John or Phillip or whomever.
1494
01:12:20.463 --> 01:12:21.764
You know, like it's hurting those.
1495
01:12:21.824 --> 01:12:22.785
It's not fair to them.
1496
01:12:23.365 --> 01:12:26.727
And so I think that it helps keep your foot on the gas.
1497
01:12:27.268 --> 01:12:33.152
And then another one I would say is we talk about like business groups and masterminds, how lonely business can be.
1498
01:12:33.532 --> 01:12:37.054
If you have somebody else you're kind of going to war with, that's really valuable.
1499
01:12:37.074 --> 01:12:42.898
So I think you said this, on the days you're down, maybe they're up and you kind of build each other up.
1500
01:12:42.958 --> 01:12:43.979
That's a great partnership.
1501
01:12:44.019 --> 01:12:46.341
So those are some of the things I'm really a big fan of.
1502
01:12:46.361 --> 01:12:49.923
But at the end of the day, it all comes back to how did you pick the partner?
1503
01:12:50.383 --> 01:12:52.825
And then what protections do you have in place if it doesn't go well?
1504
01:12:53.045 --> 01:12:55.766
Yeah, like back to the arguing part.
1505
01:12:55.786 --> 01:12:56.846
I love that stuff.
1506
01:12:57.106 --> 01:12:58.206
It means people care.
1507
01:12:58.626 --> 01:13:06.648
And I, like my definition, like the last couple of years has been like, the only thing I love in a great team member is that they care.
1508
01:13:06.688 --> 01:13:07.548
They care for the team.
1509
01:13:07.868 --> 01:13:08.849
They care for the customer.
1510
01:13:08.969 --> 01:13:10.849
And if they do care, they're willing to fight.
1511
01:13:11.269 --> 01:13:14.570
And like the leadership team in Augusta, I know they'll hear this.
1512
01:13:15.170 --> 01:13:17.871
We get like heated arguments about stuff.
1513
01:13:18.271 --> 01:13:22.432
And so like, I'm like, guys, you're going to have to go in the in like outside the office area.
1514
01:13:23.052 --> 01:13:28.338
You're going to have to go in the other room where you can close the door because, like, it gets hot.
1515
01:13:28.859 --> 01:13:33.585
But I love seeing that because it means that they do care.
1516
01:13:33.905 --> 01:13:37.049
And, like, Nathan, our VP of design, he's the same way.
1517
01:13:37.069 --> 01:13:40.232
Like, he has an opinion, and he will fight on it.
1518
01:13:40.393 --> 01:13:40.993
It's good.
1519
01:13:41.134 --> 01:13:41.674
It's so good.
1520
01:13:41.714 --> 01:13:41.854
Like—
1521
01:13:42.475 --> 01:13:53.679
When I knew I had a huge skill gap at Homeworks and went out and hired, I was really fortunate because almost the entire team worked with each other either years ago or at ActiveCampaign.
1522
01:13:54.279 --> 01:14:00.901
And so they already had that level of trust to where they could hit the ground and already be debating and already be arguing.
1523
01:14:01.101 --> 01:14:07.523
Because a lot of times it takes a couple of years to really have the trust and built up and the confidence that I can push this person.
1524
01:14:07.763 --> 01:14:10.544
I can say something against Mike and he's going to be okay with it.
1525
01:14:11.284 --> 01:14:17.710
and then be able to poke and prod at someone and not hurt their feelings, do it in a way where it's not attacking them, it's attacking the problem.
1526
01:14:18.190 --> 01:14:24.716
And so I was super blessed because they had already kind of built a lot of those connections to where you got in a room and you could duel it out.
1527
01:14:24.916 --> 01:14:25.737
That's fantastic.
1528
01:14:26.037 --> 01:14:31.922
Maybe the last thing here, this was just kind of something interesting because I did do a little bit of Googling before we talked about this one.
1529
01:14:32.282 --> 01:14:34.544
This is not a surprise to me at all, but I thought it was interesting.
1530
01:14:34.584 --> 01:14:38.868
So again, I did both a little Googling and I did a little bit of,
1531
01:14:39.566 --> 01:14:40.988
Claude or ChatGPT, I don't know which.
1532
01:14:41.509 --> 01:14:44.453
But they both said pretty much the same thing, whether or not it's accurate.
1533
01:14:44.833 --> 01:14:48.739
The real number on divorces is around 39 to 40% in the United States.
1534
01:14:49.360 --> 01:14:53.145
And the divorce number for entrepreneurs is around 48%.
1535
01:14:53.746 --> 01:14:54.587
So that's interesting.
1536
01:14:54.707 --> 01:14:58.969
which has always been my theory that business is destructive to relationships.
1537
01:14:59.309 --> 01:15:01.750
And a divorce number is like only a part of the story.
1538
01:15:02.291 --> 01:15:07.893
How many people are married, but like the relationships are not awesome.
1539
01:15:07.953 --> 01:15:11.695
I mean, I feel like that's generally the story of marriages, unfortunately.
1540
01:15:12.155 --> 01:15:14.717
So I thought that was kind of an interesting number.
1541
01:15:14.737 --> 01:15:23.501
I don't know if I ever, ever told you this one, but when we were doing our transaction on Service Autopilot, it's either the investment bank or somebody...
1542
01:15:23.881 --> 01:15:29.343
I think it was the investment bank told me, gave me a white paper that it was a study that had been done.
1543
01:15:29.864 --> 01:15:37.047
And if a transaction was over a certain amount, tens of millions of dollars, the divorce rate was something like 70% after the sale of the business.
1544
01:15:37.267 --> 01:15:38.507
Oh man, did you share that with Tiffany?
1545
01:15:38.648 --> 01:15:41.169
I told her about it, yeah.
1546
01:15:41.489 --> 01:15:44.910
Maybe I was naive, I wasn't worried about it, but yeah.
1547
01:15:45.270 --> 01:15:45.851
Yeah, so no.
1548
01:15:46.091 --> 01:15:48.932
But I, and again, was the date, my data a little bit off?
1549
01:15:48.952 --> 01:15:49.913
Was it 60 some percent?
1550
01:15:49.973 --> 01:15:51.393
It was a shockingly high number.
1551
01:15:51.733 --> 01:15:53.054
I thought that was very interesting.
1552
01:15:53.394 --> 01:15:54.355
So you want to stay in the middle.
1553
01:15:54.375 --> 01:15:56.957
You don't want to get too successful and you don't want to fail.
1554
01:15:57.518 --> 01:15:59.640
You just want to be a decent entrepreneur.
1555
01:16:02.202 --> 01:16:04.685
I don't know if that's the takeaway or maybe you just work on the marriage.
1556
01:16:06.530 --> 01:16:14.674
Yeah, it's interesting because what's funny, I remember from my psychology class way back, probably one of my first, I must have been 13, 14 maybe.
1557
01:16:15.014 --> 01:16:19.196
But I remember the 50% being thrown around and I did some digging.
1558
01:16:19.216 --> 01:16:20.657
I'm like, that's not really true.
1559
01:16:21.297 --> 01:16:25.039
The thing that I found interesting is the second marriage divorce rate.
1560
01:16:25.299 --> 01:16:26.179
So here's my question.
1561
01:16:26.799 --> 01:16:32.742
If someone has a failure rate in their partnership in business, do you think they're a toxic asset now to be...
1562
01:16:33.042 --> 01:16:33.763
If someone else...
1563
01:16:34.343 --> 01:16:36.584
came to you and said, hey, I had a partnership and it failed.
1564
01:16:36.884 --> 01:16:37.905
Is that a red flag to you?
1565
01:16:38.225 --> 01:16:39.065
I would think about it.
1566
01:16:39.185 --> 01:16:42.307
But you do kind of have to know the context.
1567
01:16:42.647 --> 01:16:42.847
Yeah.
1568
01:16:43.027 --> 01:16:45.909
Because the divorce rate jumps a lot on the second marriage.
1569
01:16:45.929 --> 01:16:47.249
For the second and third.
1570
01:16:47.269 --> 01:16:47.609
Yeah.
1571
01:16:47.629 --> 01:16:49.930
You can just compound.
1572
01:16:49.950 --> 01:16:54.893
It's like you're an entrepreneur, you have multiple marriages, and you had a $10 million exit.
1573
01:16:56.514 --> 01:16:59.235
I mean, it definitely would create question marks.
1574
01:16:59.255 --> 01:17:00.395
There's no doubt about that.
1575
01:17:00.615 --> 01:17:00.796
Yeah.
1576
01:17:01.396 --> 01:17:01.596
Yeah.
1577
01:17:01.928 --> 01:17:05.129
I think it goes back to like that the same way that you would say marriage is good.
1578
01:17:05.149 --> 01:17:06.589
It's also like, well, what about the courtship?
1579
01:17:07.029 --> 01:17:08.909
Did you spend some time with the family?
1580
01:17:09.129 --> 01:17:10.850
These other things, the same thing I think is true.
1581
01:17:10.870 --> 01:17:25.733
It's like, well, of the 39% that got divorced, how, what's the percentage that spent a couple years courting that when visit the family, you know, like all these other aspects that you would have put as asterisks or recommendations before getting into the relationship?
1582
01:17:25.753 --> 01:17:25.853
Yeah.
1583
01:17:26.639 --> 01:17:32.103
I got to imagine, I've always heard whether it's true or not, one of the top reasons people get divorced is over money.
1584
01:17:33.083 --> 01:17:34.844
They have different philosophies on how you spend money.
1585
01:17:36.686 --> 01:17:40.608
Might that also be like maybe one of the single most important things in business as well?
1586
01:17:41.268 --> 01:17:50.935
So I feel like there's this list of like five to 10 really common things or important things that we need to make sure we're aligned on these before we ever become business partners.
1587
01:17:50.955 --> 01:17:54.137
And if we're not aligned, the odds of it not working are really high.
1588
01:17:54.592 --> 01:17:54.712
Yeah.
1589
01:17:54.732 --> 01:18:03.434
And I think a lot of times people, they immediately go to, from a partnership perspective, the ones I've seen not fail, is one person has money and one person doesn't, instead of doing skills.
1590
01:18:03.474 --> 01:18:06.915
Like one person has skill in this area and I compliment them.
1591
01:18:07.035 --> 01:18:09.935
It's more like they bring the money, I bring the work.
1592
01:18:09.955 --> 01:18:16.236
And I feel like those are less commonly successful compared to, I have, to your point, sales and marketing.
1593
01:18:16.476 --> 01:18:18.637
John has the ability to be able to do technical.
1594
01:18:19.323 --> 01:18:20.744
All mine have been skills related.
1595
01:18:21.884 --> 01:18:24.546
It's like we all came into it bringing skills.
1596
01:18:24.586 --> 01:18:25.666
We are all actively working.
1597
01:18:26.026 --> 01:18:26.887
I can totally see that.
1598
01:18:27.027 --> 01:18:33.370
I can see how you, I've thought about this as being on the other side of the table now where I've had a lot of opportunity to invest in businesses.
1599
01:18:33.410 --> 01:18:39.413
And I've often thought to myself, this person isn't going to like the terms of the deal in the future when it actually works.
1600
01:18:39.913 --> 01:18:42.414
They're going to feel like they did the work and they're going to devalue the money.
1601
01:18:42.614 --> 01:18:45.796
And they're going to forget they would have never even been in business had I not financed it.
1602
01:18:46.271 --> 01:18:47.612
I have thought about that so many times.
1603
01:18:48.273 --> 01:18:50.375
I'll bet that's a very common story.
1604
01:18:50.515 --> 01:18:52.217
And if it doesn't work out, it's probably your fault.
1605
01:18:52.637 --> 01:18:53.718
Because you need to have enough money.
1606
01:18:54.098 --> 01:18:59.083
That's another experience I've had, being involved in a few things where people always need more money.
1607
01:18:59.103 --> 01:19:04.008
If they know they can get money, that's always the first thing that they want to do to solve the problem is get more money.
1608
01:19:04.288 --> 01:19:07.471
Which is a whole other problem, which is the reason I don't like the idea of angel investing.
1609
01:19:08.111 --> 01:19:12.856
I think that's why the same point of the buy a business is kind of like the fast button.
1610
01:19:13.517 --> 01:19:16.060
I think sometimes it is the lazy button because I just want to go faster.
1611
01:19:16.080 --> 01:19:16.981
I'll just go buy it.
1612
01:19:17.241 --> 01:19:20.024
Then we have the cautionary flags of that might not be the best use case.
1613
01:19:20.084 --> 01:19:21.545
I think the same thing is true in the partnerships.
1614
01:19:21.605 --> 01:19:23.087
It's like, oh, I need money.
1615
01:19:23.367 --> 01:19:25.229
I'll go find someone with money and I'll become a partner with them.
1616
01:19:25.549 --> 01:19:27.331
And it's the fast button when...
1617
01:19:28.172 --> 01:19:30.493
Is this really a partnership that's set up for success in the future?
1618
01:19:30.793 --> 01:19:38.356
Because you have different skills, you bring different things to the table, you have the tension, and it's not just this binary, I bring money, I bring sweat equity.
1619
01:19:38.716 --> 01:19:41.117
I feel like that's the easy one that a lot of us fall into.
1620
01:19:41.822 --> 01:19:42.002
Yep.
1621
01:19:42.603 --> 01:19:42.783
Yep.
1622
01:19:42.963 --> 01:19:43.223
Yeah.
1623
01:19:43.263 --> 01:19:51.771
If I'm going to invest in somebody, I want them to have a tremendous amount of skin in the game, like real legitimate risk so that they're going to be all in all the time.
1624
01:19:51.891 --> 01:19:53.012
I want reputational risk.
1625
01:19:53.352 --> 01:20:00.118
I'm not an investor in any other company besides my own, but if I was investing, I would want them to have reputational public risk if they were to fail.
1626
01:20:00.722 --> 01:20:01.222
I love that.
1627
01:20:01.522 --> 01:20:01.902
I love that.
1628
01:20:01.922 --> 01:20:02.763
I hadn't thought about it that way.
1629
01:20:02.943 --> 01:20:03.343
I love that.
1630
01:20:03.623 --> 01:20:06.724
You were talking earlier about the, is it Planet Fitness?
1631
01:20:06.784 --> 01:20:08.184
Is that the name of your business?
1632
01:20:08.484 --> 01:20:09.124
Anytime Fitness.
1633
01:20:09.905 --> 01:20:10.605
Oh, Anytime Fitness.
1634
01:20:10.625 --> 01:20:11.445
Yeah, yeah.
1635
01:20:11.865 --> 01:20:13.546
Is that a business you're going to own long-term?
1636
01:20:14.006 --> 01:20:14.586
I don't know.
1637
01:20:14.946 --> 01:20:15.946
I should probably get rid of it.
1638
01:20:16.127 --> 01:20:17.127
We're going to remodel.
1639
01:20:17.147 --> 01:20:18.047
Like they're doing it.
1640
01:20:18.207 --> 01:20:20.528
The thing that's been really helpful though, the reason I've kept it,
1641
01:20:21.308 --> 01:20:23.991
It only takes about 30 minutes of my time a week.
1642
01:20:24.252 --> 01:20:27.616
Guys go there for one quick meeting and I'm there maybe every other week.
1643
01:20:27.636 --> 01:20:30.059
So let's just call it an hour or two a month.
1644
01:20:30.299 --> 01:20:30.539
Okay.
1645
01:20:30.559 --> 01:20:32.802
I get to see what other franchise is doing internally.
1646
01:20:32.962 --> 01:20:35.926
And that's very useful for me and seeing how they pivot, how they adapt.
1647
01:20:35.966 --> 01:20:37.568
They now, the founders just left.
1648
01:20:37.588 --> 01:20:38.769
So now private equity is moving in.
1649
01:20:39.490 --> 01:20:46.777
I'm able to see all that and it'd be very difficult to get that same level of insider information if I was outside.
1650
01:20:47.058 --> 01:20:48.139
So I've kept it for that reason.
1651
01:20:48.279 --> 01:20:52.263
It does also allow me to not have to pull like a salary and stuff as big of a salary.
1652
01:20:52.283 --> 01:20:53.864
So that's helpful.
1653
01:20:54.585 --> 01:20:55.486
Do you go work out there?
1654
01:20:55.506 --> 01:20:56.627
Do you work out there?
1655
01:20:57.048 --> 01:20:58.089
Once in a blue moon.
1656
01:20:58.209 --> 01:21:00.151
Like if I'm in a meeting sometimes, I'll quickly.
1657
01:21:00.372 --> 01:21:02.975
But usually people stop at me because I was a trainer there before.
1658
01:21:03.015 --> 01:21:03.735
So a lot of people know me.
1659
01:21:03.896 --> 01:21:04.216
Oh, okay.
1660
01:21:04.236 --> 01:21:05.618
They still know you after all these years.
1661
01:21:05.738 --> 01:21:06.579
There's a lot of people.
1662
01:21:06.659 --> 01:21:07.760
It's the only gym in town.
1663
01:21:08.060 --> 01:21:09.061
It's a small town.
1664
01:21:09.622 --> 01:21:09.982
Okay.
1665
01:21:10.383 --> 01:21:10.683
Okay.
1666
01:21:10.803 --> 01:21:11.704
So, yeah.
1667
01:21:12.485 --> 01:21:16.788
So how much impact did that have on you franchising Augusta?
1668
01:21:17.409 --> 01:21:18.910
Oh, huge.
1669
01:21:18.930 --> 01:21:26.916
So the year before we franchised Augusta, Anytime Fitness was ranked number one by Entrepreneur Magazine and the Franchise 500.
1670
01:21:28.157 --> 01:21:30.640
And that was like, I would say peak service autopilot.
1671
01:21:30.680 --> 01:21:32.702
It was kind of like peak anytime fitness.
1672
01:21:33.343 --> 01:21:33.804
Oh, okay.
1673
01:21:33.964 --> 01:21:36.967
And so like founders were very involved.
1674
01:21:37.108 --> 01:21:39.130
They were very focused on anytime fitness.
1675
01:21:39.530 --> 01:21:40.552
Private equity moved in now.
1676
01:21:40.572 --> 01:21:42.554
So like they have like the bar method.
1677
01:21:42.814 --> 01:21:46.358
They have, they actually got a orange theory is now part of the group.
1678
01:21:47.279 --> 01:21:49.200
Oh, the private equity group owns all those brands.
1679
01:21:49.260 --> 01:21:49.621
Yeah.
1680
01:21:49.761 --> 01:21:57.465
Now it's like a whole, there's like five others, including like, uh, wax, wax, uh, wax city, wax the city, a couple others.
1681
01:21:57.505 --> 01:21:57.806
Anyways.
1682
01:21:58.166 --> 01:21:58.706
Oh, okay.
1683
01:21:59.066 --> 01:21:59.187
Yeah.
1684
01:21:59.207 --> 01:22:02.068
Just seeing that insider has been very useful for me.
1685
01:22:02.108 --> 01:22:12.655
And, um, it was definitely an inspiration because I stepped into the business and immediately saw, I remember like very early on, I was 15, 16, being a trainer and still going to college.
1686
01:22:12.755 --> 01:22:15.717
And I remember just thinking like, why in the world would you start a gym?
1687
01:22:16.397 --> 01:22:17.238
That wasn't Anytime Fitness.
1688
01:22:17.878 --> 01:22:20.019
Because I just remember we launched the location.
1689
01:22:20.079 --> 01:22:21.220
I was still working as a trainer.
1690
01:22:21.380 --> 01:22:23.982
But we launched the location and we're profitable on the second month.
1691
01:22:24.482 --> 01:22:25.683
It's because of the brand equity.
1692
01:22:25.903 --> 01:22:27.124
Like people just knew who we were.
1693
01:22:27.144 --> 01:22:28.204
We hardly spent any of the money on market.
1694
01:22:28.224 --> 01:22:28.805
We opened the doors.
1695
01:22:28.825 --> 01:22:29.325
People were there.
1696
01:22:29.625 --> 01:22:32.167
They had systems around like the doors, the key fobs.
1697
01:22:32.647 --> 01:22:34.268
You know, we didn't have to worry about contract stuff.
1698
01:22:34.288 --> 01:22:35.609
It was handled by the billing department.
1699
01:22:35.949 --> 01:22:37.190
Like there were so many systems.
1700
01:22:37.570 --> 01:22:39.631
And then I had been in lawn care since I was 11.
1701
01:22:39.671 --> 01:22:40.812
And I was still doing lawn care.
1702
01:22:40.832 --> 01:22:43.294
And I was just like, there's got to be something for the lawn care industry.
1703
01:22:43.314 --> 01:22:44.915
And that's when my mind started going towards...
1704
01:22:45.455 --> 01:22:47.519
you know, how can we franchise the lawn care side?
1705
01:22:47.739 --> 01:22:53.529
It's after my accident that I said, oh, I have not implemented any of these systems in my business and I implemented those.
1706
01:22:53.869 --> 01:22:54.090
So.
1707
01:22:54.491 --> 01:22:54.771
Okay.
1708
01:22:55.031 --> 01:22:56.334
How old were you when you had that accident?
1709
01:22:56.354 --> 01:22:56.915
21.
1710
01:22:58.742 --> 01:22:58.982
Okay.
1711
01:23:00.063 --> 01:23:07.309
So along this concept of the gym, since you're into all that stuff, how do you think about something else we've kind of talked about?
1712
01:23:07.329 --> 01:23:08.830
It's come up a couple of times.
1713
01:23:08.850 --> 01:23:14.754
We talked about like health and fitness and the correlation between performance and business.
1714
01:23:14.794 --> 01:23:16.495
So how do you think about that in your own life?
1715
01:23:16.676 --> 01:23:18.037
What are some of your practices?
1716
01:23:18.117 --> 01:23:22.340
And since you care about this topic, what do you tend to recommend to anyone that asks?
1717
01:23:22.878 --> 01:23:29.465
Yeah, like when it comes to business and like performance, I think there's always going to be outliers that go against the rule.
1718
01:23:29.765 --> 01:23:30.666
I think they're an exception.
1719
01:23:30.686 --> 01:23:31.687
Like Trump?
1720
01:23:31.967 --> 01:23:33.209
Yeah, Trump, Elon.
1721
01:23:33.589 --> 01:23:40.836
It's like, you know, but I think on aggregate, like if you just take the average, like if you're healthier, you are wealthier.
1722
01:23:41.737 --> 01:23:47.803
And I think physical health leads to mental health and mental health and stability.
1723
01:23:48.103 --> 01:23:52.587
Like we talked about last week is a huge ingredient to being a great leader and a great entrepreneur.
1724
01:23:53.128 --> 01:23:56.911
And so I think health is a byproduct of having the necessary ingredients.
1725
01:23:56.931 --> 01:24:02.997
So like discipline and impulse control, in other words, like doing hard things and not doing things that feel good.
1726
01:24:03.537 --> 01:24:03.837
Yeah.
1727
01:24:04.538 --> 01:24:06.319
Health is a byproduct of those two things.
1728
01:24:06.839 --> 01:24:11.482
It just so happens, I believe, that those same ingredients are what impact business performance.
1729
01:24:11.902 --> 01:24:23.329
If you can just do hard things and not do the things that don't feel good, you usually can get through hard times and do what's right for the business and get to the parts where people most of the time quit.
1730
01:24:23.789 --> 01:24:27.716
And so I think it's just, it's, it's not that you need to be healthy to have a good business or be a good leader.
1731
01:24:28.117 --> 01:24:34.910
It's just that the ingredients of good health are also really good ingredients that go into becoming a great leader, entrepreneur, business owner.
1732
01:24:35.982 --> 01:24:40.024
What you do in one area of your life is what you do in all areas of your life or however that quote goes.
1733
01:24:40.344 --> 01:24:42.345
I think that's what the concept you're generally saying.
1734
01:24:42.646 --> 01:24:43.306
Yeah.
1735
01:24:43.606 --> 01:24:45.407
Now, you're older than me.
1736
01:24:45.547 --> 01:24:46.768
I don't want to say you're old.
1737
01:24:46.868 --> 01:24:48.068
Just you're older than me.
1738
01:24:48.349 --> 01:24:55.212
So I'm interested where you're at on this because I know this was you came back to health a lot in the past several years and focusing more on it.
1739
01:24:55.492 --> 01:24:56.753
So what has that journey been like for you?
1740
01:24:57.073 --> 01:24:58.354
I've always cared about it.
1741
01:24:59.455 --> 01:24:59.815
Always.
1742
01:25:01.416 --> 01:25:08.200
But what I've always been compared to the majority of people, a pretty clean eater by a lot.
1743
01:25:10.121 --> 01:25:12.723
And I've always continued to work out.
1744
01:25:12.803 --> 01:25:18.407
But what happened is business just got so crazy that the workouts would get spread out.
1745
01:25:18.427 --> 01:25:18.927
Mm-hmm.
1746
01:25:18.967 --> 01:25:20.068
they'd be inconsistent.
1747
01:25:20.608 --> 01:25:24.911
And so it's been more of trying to bring all that hardcore consistency back.
1748
01:25:25.331 --> 01:25:31.595
And I would say since as I've gotten, I'd say somewhere in my 40s, I started to notice...
1749
01:25:32.487 --> 01:25:37.251
that I just feel like I could do whatever I wanted in my 30s had no impact.
1750
01:25:37.351 --> 01:25:38.832
I could be on planes all the time.
1751
01:25:38.952 --> 01:25:40.634
I could go to business dinners all the time.
1752
01:25:41.034 --> 01:25:42.515
I could not sleep.
1753
01:25:42.655 --> 01:25:44.417
I could do all this stuff and it didn't matter.
1754
01:25:45.057 --> 01:25:45.898
All those in your 30s?
1755
01:25:46.678 --> 01:25:47.699
Yeah, I had a high level of energy.
1756
01:25:47.739 --> 01:25:48.600
Let's go, like 10 more years.
1757
01:25:48.660 --> 01:25:49.040
Let's go.
1758
01:25:49.080 --> 01:25:50.542
Yeah, I really felt...
1759
01:25:51.542 --> 01:25:57.104
But it was somewhere in the 40s that it's like, okay, now I've got to try harder.
1760
01:25:57.644 --> 01:25:59.625
And so I've got to make more of an effort.
1761
01:25:59.845 --> 01:26:08.628
And the single biggest one is diet, where I could let maybe slip up on diet more in the past and I'd be okay.
1762
01:26:08.708 --> 01:26:09.348
Now I can't.
1763
01:26:09.928 --> 01:26:11.389
I feel it incredibly fast.
1764
01:26:11.409 --> 01:26:17.714
Like for me, and everybody's built differently, but I've really noticed it as I got into my 40s that I had to be really tight with diet.
1765
01:26:18.074 --> 01:26:29.582
I could be less on the sleep, but as I continue to get older, I just continue to believe all the stuff has to get dialed in kind of at a hardcore level to keep up your performance.
1766
01:26:29.922 --> 01:26:35.006
And so I can only imagine what it's going to mean as you move into your, you know, 50, 60, 70s, what that means.
1767
01:26:35.066 --> 01:26:41.150
And so that's, I'm seeing that right now, that, you know, you've got to be really dedicated.
1768
01:26:41.270 --> 01:26:44.512
So I, but yeah, to you, I think you're probably good for a while to come.
1769
01:26:45.773 --> 01:26:47.434
But you already have everything I know of you.
1770
01:26:47.454 --> 01:26:49.556
You've already got good habits and behaviors.
1771
01:26:49.923 --> 01:26:52.766
Yeah, like when I was 11, I had really bad acne.
1772
01:26:52.846 --> 01:26:53.887
I've heard you say that, yeah.
1773
01:26:54.008 --> 01:26:55.509
And that's actually what pushed me into fitness.
1774
01:26:55.790 --> 01:27:01.236
And I started running and sweating and like not greasy foods, not fried foods.
1775
01:27:01.516 --> 01:27:07.382
So it just kind of became a habit until when I was probably, it was probably until I was 17, 18, I had bad acne.
1776
01:27:08.023 --> 01:27:11.687
And so if I had like a pepperoni pizza, immediate breakout.
1777
01:27:12.188 --> 01:27:16.672
And so it just kept me for like those five or six years where I had to be really, really diligent.
1778
01:27:17.493 --> 01:27:20.276
And and then, yeah, it just became a habit.
1779
01:27:20.436 --> 01:27:23.440
And now it's like if I don't work out, it's horrible.
1780
01:27:23.500 --> 01:27:24.661
Like I don't ever miss a day.
1781
01:27:24.741 --> 01:27:25.682
Never, ever, ever.
1782
01:27:27.144 --> 01:27:28.125
So it just became a habit.
1783
01:27:28.405 --> 01:27:28.605
Yeah.
1784
01:27:28.845 --> 01:27:38.110
I think that's one of the biggest things I'd encourage people to do is just be hyper aware of if you're not working out versus when you're working out, what's the difference in how you feel?
1785
01:27:38.651 --> 01:27:51.418
If you truly go super clean for a period of time where you're just eating like really, I like to use the example of like no sugar and as minimal on carbs as you can be or just high quality carbs.
1786
01:27:52.218 --> 01:27:58.041
and you get past a week or two of that, and then you add that stuff back in, what happens?
1787
01:27:58.121 --> 01:28:03.244
Once you have that experience enough times, you'll see the difference in performance.
1788
01:28:03.284 --> 01:28:06.466
And I think it's true for people in their 30s and 20s as well.
1789
01:28:06.746 --> 01:28:11.709
I look around at a ton of people in their 20s, and I'm just amazed at how little energy they have.
1790
01:28:12.449 --> 01:28:14.771
And I mean, it's really bad, actually.
1791
01:28:15.391 --> 01:28:20.454
And so I just, I'm, I think it's such a competitive advantage.
1792
01:28:20.494 --> 01:28:21.115
That's where I stand.
1793
01:28:21.135 --> 01:28:23.696
And it's a massive competitive advantage as you get older.
1794
01:28:24.137 --> 01:28:27.058
And I love sports and I love all that stuff.
1795
01:28:27.158 --> 01:28:34.403
And for the majority of sports, if you'd gone down that road in life, you can't, there comes a point where you just can't do some of this stuff.
1796
01:28:34.423 --> 01:28:35.544
You eventually age out of it.
1797
01:28:35.824 --> 01:28:41.868
But frankly, on the business thing, if you take really good care of yourself, you kind of don't age out of business.
1798
01:28:42.328 --> 01:28:42.909
And that's cool.
1799
01:28:43.109 --> 01:28:44.151
You get to stay in the game.
1800
01:28:44.651 --> 01:28:51.782
And so it's another argument in my mind about really being hyper aware of what you're doing and how you're eating and all that kind of stuff.
1801
01:28:52.162 --> 01:28:55.327
Not a new topic here, but I just, it's such a competitive advantage.
1802
01:28:55.963 --> 01:29:02.348
Yeah, and like, I think the part that recommitted me to it was seeing people that fall apart on mental health.
1803
01:29:02.988 --> 01:29:08.733
And you can almost always tie it back somewhere to habits around their eating habits, their sleeping habits.
1804
01:29:09.293 --> 01:29:17.660
And like the first thing in all those cases that I would see when they would go to a doctor, it wasn't like even the medication as much as like, hey, this is what your diet needs to be.
1805
01:29:17.680 --> 01:29:18.740
This is how much you need to sleep.
1806
01:29:19.221 --> 01:29:21.643
This is exactly how much water you're going to drink.
1807
01:29:21.843 --> 01:29:23.004
This is the time you go to bed.
1808
01:29:23.024 --> 01:29:24.145
And I was like, okay.
1809
01:29:24.845 --> 01:29:32.693
If I go back, I saw all those habits being unwound prior to a huge incident and realizing I never want to be there.
1810
01:29:32.953 --> 01:29:34.335
And then starting to...
1811
01:29:34.455 --> 01:29:38.739
I got really sensitive to when I would be like even 2% towards a break.
1812
01:29:39.100 --> 01:29:40.321
A... What's it called?
1813
01:29:40.541 --> 01:29:40.681
A...
1814
01:29:41.441 --> 01:29:41.861
I've burned out.
1815
01:29:42.461 --> 01:29:50.064
Like, even when I'm feeling that, and a lot of times it revolves around lack of sleep for me, and I can feel the cortisol going through my veins.
1816
01:29:50.084 --> 01:29:50.845
You grind down.
1817
01:29:51.065 --> 01:29:51.685
Oh, yeah, man.
1818
01:29:51.785 --> 01:29:52.765
Oh, yeah, I know that feeling.
1819
01:29:52.946 --> 01:29:57.387
And like, especially when my heart starts, like, okay, I need, like, it's the record.
1820
01:29:57.968 --> 01:29:58.848
And so it's funny.
1821
01:29:59.128 --> 01:30:00.128
I've said this a couple times before.
1822
01:30:00.408 --> 01:30:04.050
I have this tail tall sign when I'm getting there, and that's I get a cold sore on my lip.
1823
01:30:04.350 --> 01:30:04.530
Yeah.
1824
01:30:04.650 --> 01:30:04.971
Okay.
1825
01:30:04.991 --> 01:30:05.591
You're run down.
1826
01:30:05.691 --> 01:30:05.911
Yeah.
1827
01:30:06.192 --> 01:30:12.236
I just know if I get a cold sore, I am within 24 hours of a really bad low and I have to get to sleep.
1828
01:30:12.377 --> 01:30:13.898
That's, it's always been kind of my thing.
1829
01:30:14.238 --> 01:30:18.942
So yeah, I had one last week when we had the security breach.
1830
01:30:19.703 --> 01:30:20.363
Not going to lie.
1831
01:30:20.383 --> 01:30:21.304
Not going to lie.
1832
01:30:22.044 --> 01:30:22.405
Oh man.
1833
01:30:22.926 --> 01:30:33.752
You know, an interesting kind of, we'll kind of end this one with this, but one of the interesting little things I observed is I took my, call it three years, I don't know the exact amount of time, maybe just over sabbatical.
1834
01:30:34.352 --> 01:30:39.375
And I didn't necessarily feel better in life during that time.
1835
01:30:39.395 --> 01:30:39.755
Hmm.
1836
01:30:40.155 --> 01:30:41.936
This is a little bit of a learning lesson.
1837
01:30:41.956 --> 01:30:45.317
I probably had heard stuff like this, but it really made it real for me.
1838
01:30:45.997 --> 01:30:48.938
I just remember it's kind of, so it started during COVID.
1839
01:30:48.978 --> 01:30:54.900
I took my break and I just, and also I've always worked in an office and I like being around people.
1840
01:30:55.601 --> 01:30:57.461
I'm extroverted in the right situation.
1841
01:30:57.481 --> 01:30:58.842
I'm introverted as well.
1842
01:30:58.902 --> 01:30:59.282
I'm both.
1843
01:30:59.922 --> 01:31:01.923
It just kind of depends on the situation.
1844
01:31:02.143 --> 01:31:03.863
But I like being in an office environment.
1845
01:31:03.924 --> 01:31:04.864
I like the energy.
1846
01:31:04.924 --> 01:31:06.164
I like the conversation.
1847
01:31:06.364 --> 01:31:06.925
I like that.
1848
01:31:07.385 --> 01:31:09.626
Now I'm at home all the time, every single day.
1849
01:31:09.706 --> 01:31:10.686
COVID's going on.
1850
01:31:11.066 --> 01:31:13.087
But we are, we traveled through COVID.
1851
01:31:13.367 --> 01:31:14.928
Like we were traveling.
1852
01:31:15.648 --> 01:31:17.168
If we could get into the country, we went.
1853
01:31:17.328 --> 01:31:18.629
You're a super spreader.
1854
01:31:18.729 --> 01:31:19.129
It's okay.
1855
01:31:19.189 --> 01:31:19.609
We understand.
1856
01:31:19.729 --> 01:31:21.430
I was trying to spread it everywhere.
1857
01:31:21.930 --> 01:31:29.077
So anyway, but I just something was off and I was like, oh, it must be me not being in the office.
1858
01:31:29.117 --> 01:31:30.919
It must be what's going on with COVID.
1859
01:31:31.679 --> 01:31:37.504
And I actually concluded it was my diet was not ideal because of the travel.
1860
01:31:37.865 --> 01:31:38.005
Yeah.
1861
01:31:38.962 --> 01:31:45.167
So you're in other countries and you're eating the food, which is part of the coolest experience of being in some of the other countries.
1862
01:31:45.187 --> 01:31:48.470
You're trying all the stuff and you're having the desserts and you're doing these things.
1863
01:31:48.530 --> 01:31:50.331
I let more of that into my life.
1864
01:31:50.591 --> 01:31:54.194
But as soon as I get that stuff out, I just feel like 100% different person.
1865
01:31:54.594 --> 01:31:57.897
I just don't think most people have felt that difference for real in life.
1866
01:31:58.397 --> 01:32:05.483
It's like truly, even for me, getting off coffee is a, and I don't drink much coffee because I don't metabolize it.
1867
01:32:05.543 --> 01:32:07.144
I can drink one cup a day max.
1868
01:32:08.305 --> 01:32:18.793
And so even getting off coffee, my energy, even now, if I don't drink one cup after five days, my energy level never dips during the day.
1869
01:32:19.073 --> 01:32:19.533
I just go.
1870
01:32:19.553 --> 01:32:25.778
But if I drink coffee, my energy, even one cup, my energy level will always dip somewhere in the day a little bit.
1871
01:32:25.978 --> 01:32:31.122
So I just don't think most people have ever had the experience of being truly off of a Coke or...
1872
01:32:31.722 --> 01:32:42.107
like Coca-Cola or a coffee or whatever the thing they're doing is to really know what it feels like to have a steady state of energy.
1873
01:32:42.127 --> 01:32:44.308
And so it was very interesting to me.
1874
01:32:44.988 --> 01:32:53.712
One of my big takeaways from my sabbatical was that this idea that when you retire or you don't have to work as much,
1875
01:32:55.933 --> 01:32:57.334
You're going to work out all the time.
1876
01:32:57.354 --> 01:32:58.534
You're going to clean up all the stuff.
1877
01:32:58.554 --> 01:33:00.995
You're going to lose the weight, whatever the story is you've been telling yourself.
1878
01:33:01.315 --> 01:33:03.135
I don't actually believe any of those stories are true.
1879
01:33:03.696 --> 01:33:17.520
I am, after doing that break, I'm more convinced that you are more likely to have a healthier diet and exercise when you're actually busy, when you have other stuff and you're maybe having to live a little closer to a schedule and a routine.
1880
01:33:17.780 --> 01:33:25.183
Whereas when you retire or go on break, I don't see almost anybody pull off the story they've been telling themselves about living healthier,
1881
01:33:25.803 --> 01:33:27.504
and working out more and sleeping more.
1882
01:33:27.604 --> 01:33:28.285
I do not see it.
1883
01:33:28.805 --> 01:33:34.348
And so that was a big learning I had because even to myself, who I'm a pretty, I'm a kind of a go for it.
1884
01:33:34.368 --> 01:33:34.789
Yeah, yeah.
1885
01:33:34.829 --> 01:33:35.449
Kind of guy.
1886
01:33:37.010 --> 01:33:40.152
That stuff all slipped during that period of time for me as well.
1887
01:33:40.232 --> 01:33:41.713
And a lot of it might've had to do with the travel.
1888
01:33:41.753 --> 01:33:43.374
So that was a long, long answer.
1889
01:33:43.394 --> 01:33:46.196
But I thought it was a, I do want to leave people with that.
1890
01:33:46.256 --> 01:33:51.599
Like I would challenge your idea that there's a day coming in the future where you'll do something different than what you're doing now.
1891
01:33:51.959 --> 01:33:52.780
You got to do it now.
1892
01:33:53.040 --> 01:33:53.320
I agree.
1893
01:33:53.560 --> 01:33:53.760
All right.
1894
01:33:53.840 --> 01:33:57.342
I wanted to ask you one last question here before we wrap it up today.
1895
01:33:57.402 --> 01:34:14.649
So we haven't talked a ton about this, but from the things that you say about Augusta in terms of the growth, I think I've seen a couple emails from you talking about the growth within the organization across all the franchisees.
1896
01:34:15.409 --> 01:34:17.070
Sounds like things are going pretty well.
1897
01:34:17.150 --> 01:34:18.210
The business is growing.
1898
01:34:18.410 --> 01:34:19.651
It all sounds positive to me.
1899
01:34:20.411 --> 01:34:29.480
What are some of the things that you think are working really well for the franchisees that are allowing their businesses to keep growing?
1900
01:34:29.641 --> 01:34:32.543
Well, first, let me say, not everything is going well.
1901
01:34:33.044 --> 01:34:33.504
Of course not.
1902
01:34:33.545 --> 01:34:35.707
I have a hundred things that need to be improved.
1903
01:34:36.167 --> 01:34:37.569
The story of business forever.
1904
01:34:37.849 --> 01:34:38.229
Oh, man.
1905
01:34:38.450 --> 01:34:38.690
Yeah.
1906
01:34:38.730 --> 01:34:42.894
So I'll put that asterisk there because there's always so many things that need to be changed.
1907
01:34:43.014 --> 01:34:43.254
Yeah.
1908
01:34:43.935 --> 01:34:50.881
I think the biggest thing in home services is having a drop off in revenue for the winter, the off season, et cetera.
1909
01:34:51.321 --> 01:34:55.205
And so two years ago, I just like, that was the only thing we would talk about.
1910
01:34:55.485 --> 01:34:59.909
It was like, if it wasn't fixing what we call Q4 collapse, everything else was off the table.
1911
01:35:00.509 --> 01:35:06.795
And so we create five different tracks because for some markets, it doesn't work to have snow plowing, which is like track three.
1912
01:35:07.676 --> 01:35:11.020
It doesn't work to have winter services because there is no bushes.
1913
01:35:11.881 --> 01:35:13.262
Some people don't want to do Christmas lights.
1914
01:35:13.582 --> 01:35:16.585
So we had we had created five tracks for the offseason.
1915
01:35:17.366 --> 01:35:23.868
And the objective was do not have a month where you ever lose money or drop below 50% of revenue of your best month.
1916
01:35:24.408 --> 01:35:30.950
And that was probably my marching, like the only thing I thought about for 16 to 18 months and creating those five tracks.
1917
01:35:31.190 --> 01:35:33.851
We have a whole like Augusta lights.com now for every location.
1918
01:35:34.091 --> 01:35:40.693
If they, if they do lights, um, selling winter services over the phone online, like same thing with snow services.
1919
01:35:40.733 --> 01:35:42.434
Like it was all off season stuff.
1920
01:35:42.994 --> 01:35:53.657
And so, yeah, like the email I think I had sent out last, like a few weeks ago was like, Q4 across the organization was like 120% revenue from one year to the next, just by focusing on it.
1921
01:35:53.897 --> 01:36:01.060
And it was like, it was like, in absolute numbers, like 8 million to over 15 million, 16 million, for that quarter.
1922
01:36:01.320 --> 01:36:02.460
And that's always been our worst quarter.
1923
01:36:02.700 --> 01:36:07.262
And then it hurts Q1 because you're trying to like, put money into the business and grow and expand and get ready for Spring Rush.
1924
01:36:07.502 --> 01:36:11.143
So a lack of preparation for Spring Rush actually came from a bad Q4.
1925
01:36:12.123 --> 01:36:18.265
And so I actually think that's the root of like why now these numbers are coming out the way they are and even like our lead flow.
1926
01:36:18.645 --> 01:36:29.549
But like we've been such a huge like luck has been huge in the way AI is going and the domain authority that having all the locations around the country.
1927
01:36:29.849 --> 01:36:33.010
This is a location from three days ago that we created the website.
1928
01:36:33.710 --> 01:36:40.413
And in the market, it's basically the first native on Google besides Lawn Starter in terms of ranking on Google.
1929
01:36:40.433 --> 01:36:40.533
Yeah.
1930
01:36:41.253 --> 01:36:46.337
And so that site started three days ago, that location, online.
1931
01:36:46.797 --> 01:36:49.820
And it's just because the domain authority of AugustaLawnCare.com.
1932
01:36:50.500 --> 01:36:55.484
And that has been, for some reason this past year, just huge for us.
1933
01:36:55.524 --> 01:36:58.946
Like, we've never been able to get the first spot on Google in three days.
1934
01:36:59.007 --> 01:36:59.267
Never.
1935
01:36:59.387 --> 01:37:02.769
It used to take three to six months after getting 100 plus reviews.
1936
01:37:03.270 --> 01:37:09.695
And like, this is a location three days ago, this site went up and it's a second spot on Google right behind Lawn Starter.
1937
01:37:10.275 --> 01:37:12.116
And so that's been a big part of it.
1938
01:37:12.136 --> 01:37:15.476
And then I'd say the last part is probably like instant quote form, just going all in on it.
1939
01:37:15.997 --> 01:37:18.557
And so we started off with like instant quotes around door hangers.
1940
01:37:18.777 --> 01:37:20.198
That was like three years ago.
1941
01:37:20.758 --> 01:37:22.679
And so you're putting a quote on the door hanger.
1942
01:37:23.239 --> 01:37:24.279
Yeah, that's what we started with.
1943
01:37:24.679 --> 01:37:26.380
And then we moved it to online.
1944
01:37:26.800 --> 01:37:30.661
Now we do it over the phone, like every single area and then adding every service.
1945
01:37:30.681 --> 01:37:38.283
Like this year, for example, we now do treatments over the phone and instant quotes on the website, but where they can actually put their credit card information in on the website.
1946
01:37:38.743 --> 01:37:42.085
And so when you say when you say treatments over the phone, what do you mean by that?
1947
01:37:42.766 --> 01:37:46.008
It's like a basic treatment package or a premium treatment package.
1948
01:37:46.288 --> 01:37:48.690
So fertilization we control, essentially.
1949
01:37:48.710 --> 01:37:50.631
You mean you're just selling it on the phone?
1950
01:37:51.157 --> 01:37:52.678
On the phone, but also the website.
1951
01:37:53.059 --> 01:37:59.164
So someone can, they'll get mowing and it's like, hey, treatments, and they can do basic and premium and put their card on file.
1952
01:37:59.424 --> 01:38:04.928
The card on file part was the unlock for us because you can have someone go through the form, fill it out.
1953
01:38:04.968 --> 01:38:08.551
But then if you can't, their card information, you're harassing them, trying to get it on before you get service set up.
1954
01:38:08.932 --> 01:38:18.840
And so we only really in the past year got adoption of it from all the owners when they knew they could have a card before they ever got notified that the service was on the schedule.
1955
01:38:19.500 --> 01:38:21.122
Sorry, that the estimate was accepted.
1956
01:38:21.923 --> 01:38:23.725
And OK, so that's been huge.
1957
01:38:23.745 --> 01:38:27.168
And then having abandoned carts where like if they don't fill out the whole form, we still get the lead.
1958
01:38:27.428 --> 01:38:29.150
We've been converting almost 40 percent of those.
1959
01:38:29.991 --> 01:38:36.897
So even if they see the price and bounce, because that was always a reason why you don't do instant quotes on your website is if they bounce, then I've lost a lead.
1960
01:38:38.179 --> 01:38:40.460
But we're able to close almost 40% of them.
1961
01:38:40.921 --> 01:38:43.382
And so that's been a huge thing this past year too.
1962
01:38:43.442 --> 01:38:57.373
So I'd say like those few things, I think overall to the owners are just becoming so much better at like operations and they just more owners in the system for longer, getting rid of big projects, getting rid of having 10 services.
1963
01:38:57.413 --> 01:39:04.098
Like some of it's just cleaning up bad habits and, and there's becoming much better operators.
1964
01:39:04.118 --> 01:39:04.418
Yeah.
1965
01:39:04.807 --> 01:39:08.575
How do you talk to your owners about operational type things?
1966
01:39:08.595 --> 01:39:12.543
Are you just constantly talking about principles throughout the organization?
1967
01:39:12.563 --> 01:39:15.970
Or how does that coaching education happen?
1968
01:39:16.673 --> 01:39:24.437
Yeah, like AI has actually been really helpful for us because we're able to take all of our training and then we synthesize all their numbers through the training.
1969
01:39:24.817 --> 01:39:26.778
And I basically say, hey, here's the areas of improvement.
1970
01:39:26.818 --> 01:39:27.738
Here's what you can do better.
1971
01:39:28.719 --> 01:39:35.162
That's been really useful because the coaching part, maybe half the owners do their monthly coaching calls and we have a coaching program, et cetera.
1972
01:39:36.442 --> 01:39:40.204
but everyone looks at their numbers because they want to see like where they're ranking against everyone else.
1973
01:39:40.665 --> 01:39:47.848
So it's been really useful for us from a data perspective to see like what's working in certain markets, where profit margins are across markets.
1974
01:39:48.289 --> 01:39:48.989
I forget your question.
1975
01:39:49.049 --> 01:39:49.589
I apologize.
1976
01:39:49.649 --> 01:39:52.811
Well, what's your process for coaching them on operations?
1977
01:39:52.831 --> 01:39:56.613
Because you said that the owners are getting better and better at operations.
1978
01:39:56.633 --> 01:40:04.197
You gave some examples where maybe they changed their behaviors, quit doing certain things, but how do you have those conversations?
1979
01:40:04.217 --> 01:40:04.477
Yeah.
1980
01:40:04.577 --> 01:40:09.419
First off, identifying what the constraint of the business is instead of trying to fight 50 fires.
1981
01:40:09.920 --> 01:40:13.281
And so I think I had to exemplify it with the whole Q4 collapse.
1982
01:40:13.301 --> 01:40:15.322
And that was just the North Star for so long.
1983
01:40:15.703 --> 01:40:17.043
And now we're seeing the results of it.
1984
01:40:17.403 --> 01:40:21.746
And so I'm really encouraging finding your constraint is inside the 4L framework.
1985
01:40:21.806 --> 01:40:22.686
And you just focus on it.
1986
01:40:22.706 --> 01:40:23.847
That's all you think about.
1987
01:40:24.367 --> 01:40:28.069
And then I'm doing my part of trying to get anything besides operations off their plate.
1988
01:40:28.409 --> 01:40:32.491
So can we do Augusta lead so they don't have to think about optimization of their Google
1989
01:40:33.611 --> 01:40:36.113
LSA and LSA, we can just do that for them.
1990
01:40:36.433 --> 01:40:38.774
Because operations is so hard when you're scaling.
1991
01:40:39.035 --> 01:40:40.155
It's always what breaks.
1992
01:40:40.676 --> 01:40:44.038
And so two-pronged approach is like, how can I take stuff off their plate?
1993
01:40:44.138 --> 01:40:47.099
Even making command center where it can serve bigger businesses.
1994
01:40:47.319 --> 01:40:55.484
It's like our current constraint right now is once they start hitting up against a million, command center isn't as useful or there's more cuts that happen.
1995
01:40:56.305 --> 01:40:57.706
They're happy when they're growing.
1996
01:40:57.726 --> 01:41:00.507
But then as it gets bigger, it's like, hey, I'm multiple GMs.
1997
01:41:00.547 --> 01:41:01.408
I have different...
1998
01:41:01.948 --> 01:41:04.951
different moving parts that make it hard to have command center service them.
1999
01:41:05.351 --> 01:41:07.132
So that's the part we're really trying to work on right now.
2000
01:41:07.853 --> 01:41:19.443
But if I can get as much off their plate to think and just focus on operations, and that comes a lot around like even things like videos for interviews, like we talked about before, we use Spark Hire, you use Loom, like...
2001
01:41:20.143 --> 01:41:28.836
How do I get it to where I got four applicants in front of them instead of 50 people that they got to contact and say, hey, I saw your resume and set up an interview.
2002
01:41:29.036 --> 01:41:35.045
So wasting the time in the onboarding process and then even the training process and giving them technical advice.
2003
01:41:35.065 --> 01:41:39.369
missions, like stages of success that they move up through and like tightening up the culture aspect.
2004
01:41:39.590 --> 01:41:44.254
Cause the part I can't do for them is like, here's how you train, like training of edging.
2005
01:41:44.274 --> 01:41:45.155
Like I can't do that.
2006
01:41:45.215 --> 01:41:47.157
Even watching videos, like it's, it, you got it.
2007
01:41:47.457 --> 01:41:48.639
You got to be out there with your team.
2008
01:41:48.699 --> 01:41:49.700
You've got to be a good leader.
2009
01:41:49.940 --> 01:41:51.542
And some of those elements I can't train.
2010
01:41:51.822 --> 01:41:54.885
So it's either, how do I simplify everything else or just take it off their plate?
2011
01:41:55.145 --> 01:41:56.987
Cause operations is always where things break.
2012
01:41:57.608 --> 01:41:57.728
Yeah.
2013
01:41:57.748 --> 01:41:58.629
It makes perfect sense.
2014
01:41:58.973 --> 01:41:59.773
But I'll be very clear.
2015
01:41:59.973 --> 01:42:01.434
We have so much room for improvement.
2016
01:42:01.954 --> 01:42:02.594
It's not- Everybody.
2017
01:42:02.614 --> 01:42:03.095
Yeah.
2018
01:42:03.115 --> 01:42:03.295
Yeah.
2019
01:42:03.435 --> 01:42:03.775
Yeah.
2020
01:42:03.955 --> 01:42:04.455
Everybody does.
2021
01:42:04.475 --> 01:42:04.675
Yeah.
2022
01:42:05.015 --> 01:42:06.796
Well, that's fantastic.
2023
01:42:06.836 --> 01:42:09.077
Anything else you want to talk about before we wrap it up today?
2024
01:42:09.877 --> 01:42:10.097
No.
2025
01:42:10.557 --> 01:42:12.018
Are we going to do now financial advice though?
2026
01:42:12.682 --> 01:42:12.902
Yes.
2027
01:42:13.082 --> 01:42:13.423
All right.
2028
01:42:13.663 --> 01:42:14.123
You kick it off.
2029
01:42:14.143 --> 01:42:14.463
So you go.
2030
01:42:14.643 --> 01:42:14.964
You go ahead.
2031
01:42:15.044 --> 01:42:15.384
You go ahead.
2032
01:42:15.704 --> 01:42:16.265
Mine's simple.
2033
01:42:16.325 --> 01:42:19.007
It's kind of what I talked about at the beginning.
2034
01:42:19.447 --> 01:42:20.087
It's top of mind.
2035
01:42:20.347 --> 01:42:21.248
Data attribution.
2036
01:42:21.268 --> 01:42:24.611
Now, this is really hard when you're small.
2037
01:42:24.831 --> 01:42:27.693
Do you do this kind of stuff for your team, or you guys just manage it all?
2038
01:42:27.833 --> 01:42:28.633
As much as we can.
2039
01:42:29.074 --> 01:42:29.674
It's still very hard.
2040
01:42:29.694 --> 01:42:30.094
Very hard.
2041
01:42:30.315 --> 01:42:30.795
Very hard.
2042
01:42:30.995 --> 01:42:35.659
Yeah, I won't go far with this, but it's this idea that you really understand.
2043
01:42:35.679 --> 01:42:49.749
So data attribution, if you don't know what the word attribution means, you're just attributing, for example, a new client to a method that brought them in, a door hanger, a lead that came in from your website that actually came from Google.
2044
01:42:50.029 --> 01:42:53.031
It's just the attribution of the client to a method.
2045
01:42:54.132 --> 01:42:58.556
It's like not as complicated as it sounds, but it's complicated to actually do the association.
2046
01:42:58.576 --> 01:42:58.696
Yeah.
2047
01:42:59.176 --> 01:43:05.141
So I won't go into the weeds here, but I would encourage you to be thinking about how can you bring this into your business?
2048
01:43:05.601 --> 01:43:08.984
And it's going to probably involve an Excel spreadsheet.
2049
01:43:09.584 --> 01:43:14.168
I think most of us just want to buy a piece of software and have everything done for us.
2050
01:43:14.569 --> 01:43:16.990
I will tell you, I do use the software WhatConverts.
2051
01:43:17.731 --> 01:43:21.193
And I dump a lot of data out of service autopilot as well.
2052
01:43:21.833 --> 01:43:28.216
Like behind the scenes, when you're filling out one of our service autopilot forms, we're tracking 10 pieces of attribution data in hidden fields.
2053
01:43:28.716 --> 01:43:30.117
And so we're dumping that data.
2054
01:43:30.137 --> 01:43:31.117
We're doing some merging.
2055
01:43:31.177 --> 01:43:33.178
Again, it might make your brain shut down.
2056
01:43:33.198 --> 01:43:34.158
You're like, I can never do this.
2057
01:43:34.178 --> 01:43:42.002
But I would encourage you to be thinking as the business gets bigger, how can you really get an understanding of what is working best?
2058
01:43:42.022 --> 01:43:42.142
Yeah.
2059
01:43:42.642 --> 01:43:48.806
How do door hangers compare to LSA, compare to Google ads, compare to organic, compare to referrals?
2060
01:43:49.647 --> 01:43:53.569
And that kind of tells you where to double down on your money because we all have limited budgets.
2061
01:43:53.970 --> 01:43:55.991
And so like, where do you spend most of your money?
2062
01:43:56.471 --> 01:43:58.072
That's an example of attribution.
2063
01:43:58.212 --> 01:44:01.414
This is the number one reason I am working the MCP for HomeWorks.
2064
01:44:01.715 --> 01:44:03.896
Because they can get in there and figure it out.
2065
01:44:04.156 --> 01:44:06.378
Yeah, because it's just, it's difficult enough
2066
01:44:06.998 --> 01:44:07.719
It's difficult.
2067
01:44:07.999 --> 01:44:10.821
Let alone if you just have a spreadsheet and you're just throwing stuff at it.
2068
01:44:10.841 --> 01:44:17.525
It's like you could literally, it's kind of like the inflation numbers, the government, they can kind of make it whatever they want.
2069
01:44:17.585 --> 01:44:19.527
You could tell any story you want to tell.
2070
01:44:19.667 --> 01:44:20.527
Doorhangers are working great.
2071
01:44:20.767 --> 01:44:21.508
Google is working great.
2072
01:44:21.528 --> 01:44:22.609
It's like, no, turn off Google.
2073
01:44:22.729 --> 01:44:25.150
Oh, you still have 80, 90% of your leads still come in.
2074
01:44:25.411 --> 01:44:26.631
Yeah.
2075
01:44:26.671 --> 01:44:29.333
Or the other example is doorhangers are working great.
2076
01:44:29.353 --> 01:44:33.616
And then you dig in a little further, like, oh, wow, they do bring in a lot of clients, but those are my highest churning clients.
2077
01:44:33.636 --> 01:44:33.996
Yeah, exactly.
2078
01:44:34.016 --> 01:44:34.497
Exactly.
2079
01:44:35.238 --> 01:44:40.345
And so this is, and I'm not saying they are, that's not the data, but this, it's really complicated.
2080
01:44:40.385 --> 01:44:47.375
So I hesitated to even mention this one, but I do want to put it on your plate and your radar as you grow this business.
2081
01:44:47.395 --> 01:44:49.579
This is something you aspire to do.
2082
01:44:49.799 --> 01:44:53.923
Yeah, and there's so many variables, and that's why I felt like the best way to do this was going to be the MCP.
2083
01:44:54.503 --> 01:45:03.331
There's still going to be holes, but the ability to say, for example, the churn aspect based upon their referral source or the lead source, that's a hard thing to measure.
2084
01:45:03.351 --> 01:45:04.492
It really is.
2085
01:45:04.512 --> 01:45:05.834
Like, so, anyways.
2086
01:45:05.854 --> 01:45:06.234
Yeah.
2087
01:45:06.915 --> 01:45:07.095
Yeah.
2088
01:45:07.670 --> 01:45:08.211
Cool.
2089
01:45:08.251 --> 01:45:08.992
So what's yours?
2090
01:45:09.112 --> 01:45:11.135
My non-financial advice is very simple.
2091
01:45:11.595 --> 01:45:16.161
Take, if you're married, or if you have a significant other, take them for a cooking class.
2092
01:45:16.442 --> 01:45:17.683
We did our first one together.
2093
01:45:17.884 --> 01:45:18.564
It was great.
2094
01:45:19.526 --> 01:45:21.628
I'm usually not that type of person, but it was fantastic.
2095
01:45:21.649 --> 01:45:22.470
It was great food.
2096
01:45:23.251 --> 01:45:24.152
And we had a great time.
2097
01:45:24.412 --> 01:45:25.713
Did you cook it and eat it there?
2098
01:45:25.893 --> 01:45:26.414
Oh, yeah.
2099
01:45:26.494 --> 01:45:27.434
Oh, man, it was great.
2100
01:45:27.695 --> 01:45:29.536
Chimichurri on some steak.
2101
01:45:30.317 --> 01:45:32.538
And the chimichurri was really the bomb.
2102
01:45:33.339 --> 01:45:34.380
And what else?
2103
01:45:34.500 --> 01:45:38.683
Oh, empanadas, which I just took all the crust off and just had the meat, but it was still great.
2104
01:45:39.063 --> 01:45:40.004
And then like a salad.
2105
01:45:40.264 --> 01:45:40.905
It was fantastic.
2106
01:45:40.985 --> 01:45:41.605
Chef led it.
2107
01:45:41.645 --> 01:45:42.766
There was like eight couples.
2108
01:45:43.527 --> 01:45:44.428
And it was a great time.
2109
01:45:45.048 --> 01:45:45.929
Who's to cook in your house?
2110
01:45:46.853 --> 01:46:11.968
it's not even close it's free i don't ever do that stuff i i have not in a single time loaded the laundry or the dishwasher she will not allow me okay hey so i know you're the dishwasher but like i i have not that's my one that's my one job that in the trash let's go i do the trash we have we have something that comes to our house twice a week to clean and they do the trash but then yeah so i guess really my job is to take the trash up to this side of the house
2111
01:46:14.197 --> 01:46:22.843
it's okay we know the humanoid robot's gonna come based upon last week's episode it's coming oh man so all right good good seeing you good seeing all of you we'll see you next week