Latest / The Turn: Blue Collar to Billions / He joined as employee 20 and scaled it to $1 billion

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He joined as employee 20 and scaled it to $1 billion · The Turn: Blue Collar to Billions

• 0:00
  SPEAKER_01: Welcome back to the term.
• 0:01
  SPEAKER_01: I'm Corey Mitchell of Iconic Founders.
• 0:04
  SPEAKER_01: Here on the Turn, we talk about the built environment.
• 0:07
  SPEAKER_01: That's the construction industry and everything around it that supports the built environment.
• 0:12
  SPEAKER_01: The founders that have built incredible companies and oftentimes told we're also going to be adding some new sections to the podcast, where we're actually going to be talking about folks who have grown it to scale with it.
• 0:27
  SPEAKER_01: So they can tell us about some of the best practices.
• 0:30
  SPEAKER_01: Well, on this episode of the turn through this thing, who is the CEO of Blue Sky, tells us this incredible journey.
• 0:40
  SPEAKER_01: He was not the founder of the business, but he started as employee 20 or 21 and he worked all the way up to CEO of the business.
• 0:49
  SPEAKER_01: And he also was there before private equity partners.
• 0:54
  SPEAKER_01: And they take it from a$10,$12 million business when he started there to over a billion dollars.
• 1:01
  SPEAKER_01: It's rare that we get to really see the inside perspective of someone who started by not literally sweeping the floor, but he started at the bottom and working his way all the way through.
• 1:16
  SPEAKER_01: And that journey along the way is just incredible.
• 1:20
  SPEAKER_01: And I watched it from the outside being here in Colorado with Blue Sky Today.
• 1:25
  SPEAKER_01: And it was neat to be able to talk to him in person.
• 1:30
  SPEAKER_01: So let's get into it.
• 1:32
  SPEAKER_01: Welcome back to the Turn.
• 1:33
  SPEAKER_01: I'm Corey Mitchell of Iconic Founders.
• 1:35
  SPEAKER_01: The Turn is where blue-collar founders talk about the businesses they've built, the value they've created, and what comes next after they sell.
• 1:45
  SPEAKER_01: I'm really pumped to have you on the show because, you know, I watched the journey of Blue Sky from the sidelines.
• 1:55
  SPEAKER_01: Being in the environmental industry, I was just sort of watching, and in Denver, right?
• 2:02
  SPEAKER_01: So it's a it's also a Colorado origin story, which over time turns into one of the most spectacular successes in national growth over the last, you know, 15 years.
• 2:17
  SPEAKER_01: Um and so I'm watching it from the sidelines and trying to figure out how I can learn from what you're doing.
• 2:23
  SPEAKER_01: I'm watching the several times the business sold.
• 2:27
  SPEAKER_01: One other thing I'll say before we get going is you're you're also not the founder of the business.
• 2:32
  SPEAKER_01: And so that's also a little bit different than what we've had on the on the show, but one of the first employees in the company.
• 2:39
  SPEAKER_01: And so you've seen every part of it and you kind of you know went from sweeping the Florida to running the joint.
• 2:46
  SPEAKER_01: And so why don't you start us from the beginning?
• 2:48
  SPEAKER_01: Maybe start us with you know a little bit about your upbringing and how you got into the construction industry.
• 2:56
  SPEAKER_00: Yeah.
• 2:56
  SPEAKER_00: So I grew up in Rochester, Minnesota.
• 2:59
  SPEAKER_00: Um, really uh, you know, fairly blue-collar upbringing, bringing.
• 3:03
  SPEAKER_00: Uh my my my dad was a farmer from northern Iowa that turned into an entrepreneur and turned into many things, but really a lot of my youth was was spent uh he bought and sold and managed properties.
• 3:15
  SPEAKER_00: And so we were always fixing something.
• 3:17
  SPEAKER_00: You know, many many people have different avenues and we had a great up, I had a great upbringing bringing, but um, we were always fixing buildings.
• 3:23
  SPEAKER_00: And so I just grew up in construction, grew up with my hands and uh on stuff.
• 3:28
  SPEAKER_00: And uh that transferred into as I exited high school, I thought construction management was what I wanted to study.
• 3:33
  SPEAKER_00: So I went to University of Wisconsin Stout, small state school in western Wisconsin for construction management.
• 3:39
  SPEAKER_00: Really worked my way through college.
• 3:41
  SPEAKER_00: I had many different jobs.
• 3:42
  SPEAKER_00: I was a framer, I was I was doing roofing, you know, a lot of hands-on, but that's how that's how you pay the bills and pay for the tuition, right?
• 3:49
  SPEAKER_00: So um fast forward towards the end of college, uh, I just ran an ad in the paper for remodeling services.
• 3:56
  SPEAKER_00: And that's back when you could run an ad in the paper and and that's how you still work.
• 4:00
  SPEAKER_00: Uh, and so started off with a small business there and um fast forward for a few years, ended up uh with uh a group of employees, and we were building houses and uh spec homes and and custom homes and and then uh doing some excavation in concrete.
• 4:16
  SPEAKER_00: So I have a hand in all kinds of stuff, but I'd probably give my my dad credit at the beginning for that entrepreneurial attitude and go figure it out.
• 4:24
  SPEAKER_00: So that's where I started at least.
• 4:26
  SPEAKER_00: Um and uh ended up moving to Colorado after that.
• 4:29
  SPEAKER_00: But uh yeah, that was the start.
• 4:31
  SPEAKER_01: So your dad, right?
• 4:33
  SPEAKER_01: Yeah, I I always, you know, it's like a little Sigmund Freud stuff, but I always ask about the parents what were some of the things that he taught you that maybe made you entrepreneurial?
• 4:44
  SPEAKER_01: Because 99.9% of people don't have that itch.
• 4:48
  SPEAKER_01: They want to go get a job, they want to punch in, punch out, they want to get their check because it's certain on Friday.
• 4:54
  SPEAKER_01: But the idea of entrepreneurial risk is not necessarily innate.
• 4:58
  SPEAKER_01: And so what about him inspired you?
• 5:01
  SPEAKER_00: It was just constant.
• 5:03
  SPEAKER_00: Uh constant, constant willingness to to look for something different, uh, you know, a constant positive attitude to go figure it out, um, willingness to take risk.
• 5:12
  SPEAKER_00: All all those were wrapped up in a ball of, you know, that's just his mindset.
• 5:17
  SPEAKER_00: And I think it was, you know, from where he grew up, he he he was, you know, one of six children and and living in a small community, and they they kind of had to go do something uh else, right?
• 5:29
  SPEAKER_00: So uh and and we're all built different.
• 5:32
  SPEAKER_00: I think that's just how he was built too.
• 5:33
  SPEAKER_00: So that's the environment I grew up in.
• 5:35
  SPEAKER_00: That's the words that were discussed, that's the the things I observed as as a young man.
• 5:40
  SPEAKER_00: And so I think it it kind of gave me a good perspective of you know, just willingness to try, willingness to go to go do something new.
• 5:49
  SPEAKER_00: And sometimes it worked, sometimes it didn't, but that's okay.
• 5:52
  SPEAKER_00: And I also saw him, you know, bootstrap up from new things and and go go find the next.
• 5:58
  SPEAKER_00: So um yeah, that's what I grew up in.
• 6:01
  SPEAKER_01: Well, you know, you skipped over a part.
• 6:03
  SPEAKER_01: You moved to Colorado, but something happened in between that that made you I mean, you you started a business.
• 6:09
  SPEAKER_01: Did something did something go wrong uh before you left?
• 6:13
  SPEAKER_00: A lot went right, but I would say that uh as a young man operating my my own thing, uh, I didn't really have the financial acumen.
• 6:22
  SPEAKER_00: I didn't have the financial rigor that I thought I would today, right?
• 6:25
  SPEAKER_00: Uh and 9-11 was in that story.
• 6:27
  SPEAKER_00: So uh when 9-11 hit, um, everything sort of stopped, I think, nationally, but certainly in the area I was operating.
• 6:34
  SPEAKER_00: And I learned real quick about cash flow.
• 6:37
  SPEAKER_00: And so um, you know, I had I had equipment financed, I had, you know, uh payroll to cover, I had things happening, and and we were doing great uh as long as um kind of the the jobs were rolling in every week, which they were.
• 6:50
  SPEAKER_00: But then we had about a three to six month period where it slowed down drastically, and I I was top heavy on some on some stuff that pinched my cash flow.
• 6:57
  SPEAKER_00: So I got through it, but um tough lessons, and then fighting Minnesota winners said, Hey, I I'm I'm ready for a a different place and a different start.
• 7:05
  SPEAKER_00: So um that's really really what happened is is that that lesson on cash flow.
• 7:10
  SPEAKER_01: Yeah, you and I uh have have that uh t tough winners in common, you know, being from yeah, being from Iowa and myself, and um but also learning like these early challenges.
• 7:23
  SPEAKER_01: I mean, God, I talk to founders all the time and they say, Corey, I I don't understand where the money is.
• 7:32
  SPEAKER_01: I'm growing every month.
• 7:35
  SPEAKER_01: My books say I'm making money, but I'm growing and I just can't keep up.
• 7:41
  SPEAKER_01: And people don't realize, you know, that starting with nothing, having no backstop, having no line of credit, you know.
• 7:50
  SPEAKER_01: I always say you can only get a line of credit if you don't need one, right?
• 7:54
  SPEAKER_01: Like if you got plenty of money in the bank, they'll give you a line of credit.
• 7:56
  SPEAKER_01: You don't, banks don't want to take any risks on you.
• 7:59
  SPEAKER_01: And so that pain of growth and the challenges when maybe something stops or a job goes bad, or you got some important AR that doesn't come in on time, it just it's the most powerful early lesson you can have in this industry.
• 8:16
  SPEAKER_01: And it's something that like it, I think it's important to hear those hard stories because those things are what make you and teach you resilience and how to learn uh going forward.
• 8:28
  SPEAKER_01: So uh thanks for thanks for sharing that.
• 8:31
  SPEAKER_01: So you come out to sunny Colorado, how'd you end up at Blue Sky?
• 8:34
  SPEAKER_00: Well, I had a about a four-year stint at Pulti Homes.
• 8:38
  SPEAKER_00: So look, I moved, I said I need to get a job, um, not ready to restart another business in Colorado because I didn't know the market, right?
• 8:44
  SPEAKER_00: So I I reached out and had a couple connections and found myself building homes for Pulti homes.
• 8:49
  SPEAKER_00: And so um spent about four years with them, built about a thousand homes, uh, learned about HR and good things and and all the fun stuff that um that that size of an organization could give a young person, right?
• 9:04
  SPEAKER_00: So uh was a great, great learning experience with great people.
• 9:08
  SPEAKER_00: But fast forward to 2007, home building was taking a major nosedive nationally.
• 9:13
  SPEAKER_00: I mean, all over, just where the economy was.
• 9:15
  SPEAKER_00: And so uh Pulti was not immune to that.
• 9:17
  SPEAKER_00: And I I'd administered five rounds of layoffs and I was working hard and doing good things, but it was clear that um things were going the wrong direction just as a marketplace.
• 9:27
  SPEAKER_00: And so I started networking and and got referred to Blue Sky.
• 9:31
  SPEAKER_00: And like many other people, you know, this this friend of ours said, Hey, you should look into restoration and talk to Terry and Andy over at Blue Sky.
• 9:38
  SPEAKER_00: I said, What's restoration?
• 9:39
  SPEAKER_00: Right, and I knew construction and I'm great at that, but I had never really understood or been been introduced to the concept of that as a standalone industry.
• 9:47
  SPEAKER_00: So yeah, 2007 got introduced to to Andy and Terry, and um I I I decided to join on as employee number 20 or 21.
• 9:57
  SPEAKER_00: And my mandate was uh reporting to Terry, and my I was supposed to fix and professionalize the operations, and so I took over the project management group, and and uh obviously there's more story from there, but that was really the start.
• 10:10
  SPEAKER_01: Okay, so taking us back a step one once again, you're in this Pulti business.
• 10:15
  SPEAKER_01: You said it kind of taught you some things that a larger business can can afford.
• 10:20
  SPEAKER_01: Were there things that you also learned from that business that helped you?
• 10:26
  SPEAKER_01: Like here you see this very sophisticated, large national company.
• 10:30
  SPEAKER_01: Were there things that they did that you were able to to to you know bring into a business like Blue Sky that's still a small, really small regional business at that time?
• 10:40
  SPEAKER_00: You know, this one's gonna sound odd, but I think it's probably one of the bigger keys.
• 10:43
  SPEAKER_00: Obviously, as a larger organization, Pool T had had their act together, has their act together with HR, uh, how to treat employees, the proper process of bringing somebody and onboarding them and training.
• 10:54
  SPEAKER_00: And, you know, they they introduced the concept of mentoring and making sure that somebody joining the organization had a good start.
• 11:01
  SPEAKER_00: It also gave me a good um understanding of what not to do um as far as culturally and you know actions in the workplace and all those things that you know, as I was able to step into Blue Sky, great people, having fun, tons of energy, tons of momentum.
• 11:16
  SPEAKER_00: But um let's let's not let's not get ourselves in trouble either, right?
• 11:20
  SPEAKER_00: And so when you start just become a bigger organization, the sophistication of who we hire, how we hire, how we treat our employees, it it needs to take a step up as well.
• 11:29
  SPEAKER_00: And so um that was a big piece I brought from Pulti.
• 11:32
  SPEAKER_00: But they had a they had a mentoring culture that I think is just tremendous, and I think that set the tone for my management style later on, how I treated people, and just just how to act.
• 11:44
  SPEAKER_00: And uh, I think it was something that we implemented at Blue Sky for sure, but uh really valued that from the Pulti days.
• 11:51
  SPEAKER_00: Cool.
• 11:52
  SPEAKER_01: Okay, so you get to Blue Sky, and what size business is it at this time?
• 11:56
  SPEAKER_00: 20 or 21 as far as employees, somewhere.
• 11:58
  SPEAKER_00: 20 or 21, yeah.
• 11:59
  SPEAKER_00: You said that.
• 12:00
  SPEAKER_00: Uh right after right after joining, we had a celebration to celebrate the first million dollar month.
• 12:05
  SPEAKER_00: Probably we're looking at a 10 to 12 million dollar business at that point when I joined.
• 12:08
  SPEAKER_00: So they they got a good start, which is uh nothing to sneeze at.
• 12:12
  SPEAKER_00: But um yeah, it was uh it was a single location, one shop, bunch of trucks and good people, and and uh offered run doing restoration.
• 12:21
  SPEAKER_01: Isn't it fun being in a business that size?
• 12:26
  SPEAKER_00: It was an absolute blast uh the entire time, but really it was a story of hey, we don't have this, so let's fit let's figure it out.
• 12:33
  SPEAKER_00: And so a lot of my time I was able to work with the team, be part of it, lead.
• 12:38
  SPEAKER_00: And so if you think about best practices, you know, you know, most of them have my name on them as the author.
• 12:44
  SPEAKER_00: And that's you know, that was the early days.
• 12:47
  SPEAKER_00: Go figure it out.
• 12:48
  SPEAKER_00: And you know, think about we can fast forward to the greenfields and opening new offices and get licensed nationally.
• 12:53
  SPEAKER_00: We didn't have a roadmap, and so the the the there was a joy and a adventure of let's go do this, let's build it.
• 13:00
  SPEAKER_01: Drew learned the hard way how to build a greenfield location, and he explains to us what the heck that means.
• 13:06
  SPEAKER_01: I think that there is so much to learn from how he both failed and succeeded at building out their company.
• 13:17
  SPEAKER_01: For me personally, I you know I had about a 50% success rate.
• 13:22
  SPEAKER_01: We'd open new office locations, it was so tough to find the right leadership.
• 13:27
  SPEAKER_01: But today, I learned a lot about how I might have done it differently.
• 13:32
  SPEAKER_01: And I think you'll find that if you're looking to expand your business, this is a pretty interesting part of the story.
• 13:39
  SPEAKER_01: I love it.
• 13:39
  SPEAKER_01: Well, this greenfield piece is is is really fascinating and something that I don't think most people are probably familiar with, what that means.
• 13:48
  SPEAKER_01: So maybe just start us out with, you know, what is a greenfield?
• 13:52
  SPEAKER_01: And then how how do you how did you think about that um in terms of a road to expansion of the business?
• 14:02
  SPEAKER_01: And maybe walk us through some of those early successes, any failures that occurred along the way, so that over time you got you know really good at it, because I know you got good at it as a business.
• 14:16
  unknown: Yeah.
• 14:16
  SPEAKER_00: So Greenfield, by definition, would be an expansion of an existing business plan, right?
• 14:21
  SPEAKER_00: So we're just we have a good plan, it's working.
• 14:24
  SPEAKER_00: We're gonna do a new location and do the same thing.
• 14:26
  SPEAKER_00: That at least was our world.
• 14:28
  SPEAKER_00: So uh for us that meant moving from Denver to Colorado Springs, expanding throughout other locations in Colorado.
• 14:34
  SPEAKER_00: So four in the end, Western Slope, uh outside of Ale and Fort Collins.
• 14:40
  SPEAKER_00: So it was another office of us doing the same thing, allowing us to serve a different geographic uh sector there.
• 14:47
  SPEAKER_01: So Greenfield is hard.
• 14:49
  SPEAKER_01: I mean, and uh most people don't do it well.
• 14:53
  SPEAKER_01: I mean, that's just the reality as a lot and a lot of them fail.
• 14:56
  SPEAKER_01: So, what were some of the secrets to those successes?
• 15:00
  SPEAKER_01: And what are the some of the things you learned along the way?
• 15:03
  SPEAKER_01: And then also, like what did not work?
• 15:05
  SPEAKER_00: The things that worked were the energy, the business plan, we know how to sell.
• 15:10
  SPEAKER_00: What didn't work was starting off soft.
• 15:13
  SPEAKER_00: So uh had a couple failed green fields in the early days, which meant, hey, let's go open an office um in Houston.
• 15:21
  SPEAKER_00: Uh, that's a great example.
• 15:22
  SPEAKER_00: Had a person, a good person that we we hired said, hey, we're gonna back you and we want you to go sell work and we'll come support it from our other resources nationally.
• 15:32
  SPEAKER_00: And the lesson learned there was it didn't really work to have one person working out of his living room uh for for at least the restoration business.
• 15:40
  SPEAKER_00: And so uh we tried that and spent a year doing it.
• 15:43
  SPEAKER_00: And what are we doing?
• 15:44
  SPEAKER_00: Let's get a project manager.
• 15:45
  SPEAKER_00: And so if I could summarize all those lessons, is if you've got a working business plan and you want to do a greenfield, you have to truly copy the working business plan.
• 15:55
  SPEAKER_00: And that's staffing, equipment, facility, all the things that are working, you have to actually go do that.
• 16:01
  SPEAKER_00: And where I've where I've failed, where I've seen others fail, is when they don't follow that very, very simple recipe, which they may not do a full office.
• 16:09
  SPEAKER_00: They might just do a warehouse, but no office space.
• 16:12
  SPEAKER_00: They might do part of a team, you know.
• 16:15
  SPEAKER_00: And in our world, we had a general manager, business development, project director, project manager, technicians, that makes a team, right?
• 16:23
  SPEAKER_00: And so if in in any case we didn't have that full team, we weren't really going to market as as the business that works.
• 16:30
  SPEAKER_00: We're going to market as a different business.
• 16:32
  SPEAKER_00: And in the early days, we thought it wasn't a big deal.
• 16:34
  SPEAKER_00: Today I would sit here and scream from the rooftops.
• 16:37
  SPEAKER_00: That's a big deal, at least for our world, but we gotta we gotta do the business part.
• 16:42
  SPEAKER_01: Yeah, this this idea of a business plan.
• 16:46
  SPEAKER_01: Uh, you know, of course, so many of us I even say it today, you know, I have a new launching business, and and I sort of say we are a business plan information, right?
• 17:00
  SPEAKER_01: Well, that's really different from what you're talking about.
• 17:02
  SPEAKER_01: You're saying we we need to, okay, so we've built a successful business here in Denver, and we sort of need to document what has worked and then what we want to repeat so that way we can do it again.
• 17:14
  SPEAKER_01: How is that different from the the guy in his name in his in his uh living room?
• 17:20
  SPEAKER_01: Does it does it does it cost more?
• 17:22
  SPEAKER_01: Does it faster, slower?
• 17:25
  SPEAKER_01: I'm just wondering, because I I see the living room version all the time too.
• 17:28
  SPEAKER_00: The living room version doesn't cost as much, right?
• 17:31
  SPEAKER_00: But then you don't have it's like it's not it's like having a car with no wheels on it, right?
• 17:36
  SPEAKER_00: You're gonna have the most beautiful um machine out there, but you're gonna have wheels, it's not gonna roll.
• 17:41
  SPEAKER_00: And so um, yes, it costs more to do a full greenfield path.
• 17:46
  SPEAKER_00: Um, but it also is it's a great exercise.
• 17:49
  SPEAKER_00: So what we went through is, and I did, I didn't realize how massive this would be, but it was turning tribal knowledge, things we just innately did, into written best practice, written policy, actually defining you know, the roles of each person on the team and what they did.
• 18:06
  SPEAKER_00: And once we did that, we had this aha moment where we say, wait a minute, if our business development person is supposed to have outreach all day, all day long, and we don't have that person on the team, guess what's not happening?
• 18:19
  SPEAKER_00: The outreach.
• 18:20
  SPEAKER_00: Or if we if our project manager is supposed to be, you know, boots on site, physically looking at and managing the product the project, interacting with customers.
• 18:29
  SPEAKER_00: And if we don't have that, guess what's not happening?
• 18:32
  SPEAKER_00: And so then you get failures in lead generation, or you get failures in customer service, or you know, oversight.
• 18:39
  SPEAKER_00: And so it just continually reinforced, and it maybe took us 10 years to really learn the lesson.
• 18:45
  SPEAKER_00: Uh, but it reinforced, you gotta have all the all the legs on the table, you gotta have all the seats on the bus, whatever you want to call it, but you gotta you gotta have the team there.
• 18:53
  SPEAKER_01: One of the things that Drew talks about in this episode is really writing down your company business plan.
• 18:59
  SPEAKER_01: So many business owners I talk to, you know, they they do things a certain way, but they don't necessarily write it down.
• 19:07
  SPEAKER_01: Well, when Blue Sky found something that worked, they wrote it down, they documented it, and they created best practices.
• 19:16
  SPEAKER_01: And as they scaled across the country, that allowed them to do it over and over again, making it repeatable.
• 19:23
  SPEAKER_01: And I'll tell you, it worked.
• 19:26
  SPEAKER_01: That's the kind of organic growth that so many people are trying to figure out how to do and really never succeed at.
• 19:33
  SPEAKER_01: And so, you know, check out this part of the episode because it really is a seminar on how to do it right.
• 19:40
  SPEAKER_01: Yeah, you know, one of the things that I I, you know, I probably over the years opened, I don't know how many greenfields.
• 19:46
  SPEAKER_01: The hardest thing I always had was identifying the right leader for a market.
• 19:52
  SPEAKER_01: What were some of the things you did to find that right leader so that you've succeeded more than you failed?
• 20:00
  SPEAKER_00: So we did it a couple different ways.
• 20:01
  SPEAKER_00: And um, the first thing we did was we took somebody that we knew and trusted, and we used that model to say, well, would you move to this new market and go be the leader and go do the business?
• 20:15
  SPEAKER_00: And actually, I thought that was a beautiful plan, but it failed every time.
• 20:20
  SPEAKER_00: Really?
• 20:21
  SPEAKER_00: It did.
• 20:21
  SPEAKER_00: And if I go back, look, we had great people, we had great intent, they had great support, but what they were doing is they're starting from zero in that marketplace.
• 20:30
  SPEAKER_00: They didn't they didn't have anybody that they knew to recruit, they didn't have customer relationships, so they had to start from so far above zero that it was just a big curve.
• 20:40
  SPEAKER_00: And so later on in the Greenfield story, we really got committed to hiring somebody from that market that had some establishment and relationship, knowledge of what is where.
• 20:51
  SPEAKER_00: And then we anchored on our define best practices because by that time we'd we'd put that in writing, we got it figured out, and and we were able to give them the business plan.
• 21:01
  SPEAKER_00: You know, if you take the all the way to the far spectrum, right?
• 21:03
  SPEAKER_00: You think about franchises.
• 21:05
  SPEAKER_00: We were not franchised, we're company-owned stores, but but we were trying to give them as much of a plan as you might expect from a franchise, if that makes sense.
• 21:15
  SPEAKER_00: And so by by anchoring on that plan, then we can go manage to it, we can have accountability, we can, we can, you know, save the lesson learning.
• 21:24
  SPEAKER_00: So that's the other challenge.
• 21:26
  SPEAKER_00: If you got some some individual in their living room, they're figuring it out just like a when you started your business.
• 21:32
  SPEAKER_00: And, you know, they might have different bias, they might have different knowledge, and they're gonna do it differently.
• 21:37
  SPEAKER_00: And sometimes just the fact that it's different is is crippling.
• 21:40
  SPEAKER_00: And so we really anchored on do it the same, follow the best practice.
• 21:44
  SPEAKER_00: Here's your here's your plan of operation, go do it.
• 21:48
  SPEAKER_00: And then it just becomes execution for that person that is local to the market, and it turned out to be a much easier path.
• 21:55
  SPEAKER_01: You know, I know you guys over time sold several times, but I'm just wondering when I start thinking.
• 22:00
  SPEAKER_01: About the timeline, you're there, you start out, you know, your eight to twelve million dollar business when you get there, you have your first million dollar month, you're starting to build out some of these or you know, these organic growth plans, including green fielding.
• 22:15
  SPEAKER_01: Are you doing any MA at this time?
• 22:18
  SPEAKER_00: Not in the not in the early days.
• 22:19
  SPEAKER_00: So if you think about the period from 2007 through um really through our first private equity partnership, the MA didn't start until 2017.
• 22:28
  SPEAKER_00: So 10 years into the story.
• 22:30
  SPEAKER_00: Does your role stay the same all the way through that story?
• 22:33
  SPEAKER_00: No.
• 22:33
  SPEAKER_00: Uh titles change, uh, but uh role evolves with the size of the business.
• 22:39
  SPEAKER_00: So uh 10 million in revenue, there's different actions, there's different needs, there's different pressures, uh, as opposed to 25 million and 50.
• 22:48
  SPEAKER_00: And so there's a reinvention, really for me, of myself at what, 50 times through the growth of this guy.
• 22:55
  SPEAKER_00: Um and so I got really good at being being ready to change.
• 23:00
  SPEAKER_00: And and I think that's something I've seen with you know, fast forward businesses we've acquired, uh leaders I've managed, leaders I've helped.
• 23:08
  SPEAKER_00: Uh adjusting yourself to the size of the business and the needs um is is hard, but it's a hundred percent necessary.
• 23:16
  SPEAKER_00: Um, otherwise you end up being stuck, and somehow that becomes a limiting factor for the business.
• 23:21
  SPEAKER_01: So, what that leads you guys to down this path of selling the company?
• 23:26
  SPEAKER_00: You know, I I I think uh I'll give credit, Terry Shadwich, brilliant guy, um really the really the driver of a lot of that growth and motivator and great builder of a team.
• 23:35
  SPEAKER_00: Um but I think he was it was uh it was time for him to to go do something different.
• 23:40
  SPEAKER_00: And so I I would just put it down as fundamental his desire to take a different step and you know, probably take some chips off the table.
• 23:47
  SPEAKER_00: And I don't want to speak for Terry, but those are the things that I remember, right?
• 23:50
  SPEAKER_00: Um so it was time for him, and and that's okay.
• 23:52
  SPEAKER_00: It was his decision.
• 23:54
  SPEAKER_01: You've taken on this evolving role, business is now much larger.
• 23:58
  SPEAKER_01: Um had you opened any greenfield locations before you did that deal?
• 24:02
  SPEAKER_00: Oh, yes.
• 24:03
  SPEAKER_00: So we were at um we were at nine locations at that point.
• 24:06
  SPEAKER_01: Okay.
• 24:07
  SPEAKER_01: So you've scaled this baby up, your nine locations, and you guys do a deal.
• 24:11
  SPEAKER_01: This in a certain sense is really where I start watching from from the sidelines, because it's starting you guys are starting to grow and build like this this story.
• 24:20
  SPEAKER_01: And everyone, you know, I'm sure you didn't know this from the sidelines or from being inside of it, but a lot of people were watching the story unfold um from the outsides.
• 24:28
  SPEAKER_01: I remember, you know, people in the environmental, the restoration industry, investment banking, and people talking about this blue sky model, so which is pretty cool.
• 24:38
  SPEAKER_01: What changed at that moment when you bring in a private equity partner?
• 24:44
  SPEAKER_01: And how how does your role start changing uh in a different way?
• 24:49
  SPEAKER_01: Um, just kind of curious, walk us through that era.
• 24:53
  SPEAKER_00: Yeah, so I mean, fundamentally, the leadership changed.
• 24:56
  SPEAKER_00: So uh Terry Shadwick stepped out of the day-to-day.
• 24:59
  SPEAKER_00: Kent Stemper, our then CFO, turned into the CEO.
• 25:02
  SPEAKER_00: I was chief operating officer or some version of that, um, but really a number two to either either one of the CEOs at that point.
• 25:09
  SPEAKER_00: Um, and so the leadership changed.
• 25:11
  SPEAKER_00: And Kent brought um as the new CEO, he brought a financial acumen and financial rigor to the business that he'd put into place as CFO.
• 25:20
  SPEAKER_00: He did a great job there, but he he really pushed that further into the culture.
• 25:25
  SPEAKER_00: And and Kent's a great, a great leader in many respects, but he has a flair for and a drive for let's go sell and grow.
• 25:32
  SPEAKER_00: But he's also very disciplined on the financial side.
• 25:35
  SPEAKER_00: So that was very healthy.
• 25:36
  SPEAKER_00: But now we've got a new private equity partner, and the man, so much changed.
• 25:42
  SPEAKER_00: The reporting structure, the cadence, the the um the methods of communication, who we have to talk to.
• 25:49
  SPEAKER_00: You know, before I could walk down the hall and talk to Terry, right?
• 25:52
  SPEAKER_00: And now I've got uh a group of great people, but they're they're living in another state, and now we've got a cadence of meetings, we've got a cadence of reporting, we've got board meetings that are more formal.
• 26:02
  SPEAKER_00: And and those things started to take shape, all very healthy for us as a team and for our business.
• 26:08
  SPEAKER_00: Um, and for for for us, one of the things that I think was a big piece of the growth story and a big piece of the success is we went through diligence, right?
• 26:17
  SPEAKER_00: And for those of you that haven't sold a business and haven't gone through diligence, it is it sucks.
• 26:23
  SPEAKER_01: Um that's a direct quote for me, I think, on this on this same show.
• 26:27
  SPEAKER_01: I said there's no way to sugarcoat it.
• 26:29
  SPEAKER_01: Diligence sucks.
• 26:30
  SPEAKER_00: But it's it's it's it's a it's a tough experience because you get asked so many different questions about what data do you have, how do you look at the business, what is this, and and it's questions that you haven't thought of and and questions you may not have the probably don't have the answer to, and you got to go find it, right?
• 26:48
  SPEAKER_00: Um, and so we took that diligence process and actually had a had a follow-up mini retreat, if you will, where we took all those questions and said, you know, next time we go through this, I want to have the answer to this question.
• 27:01
  SPEAKER_00: And so what do we do?
• 27:02
  SPEAKER_00: And so we used the diligence process to somewhat re-engineer the business to say, well, this is, you know, we should be able to answer our top 10 customers.
• 27:12
  SPEAKER_00: We should be able to have three years of customer data and see trends.
• 27:15
  SPEAKER_00: We should be able to see our safety records in a in a you know, micro and macro picture.
• 27:21
  SPEAKER_00: We should be able to see our margins and and and outliers.
• 27:24
  SPEAKER_00: All the things that they asked us, which were great questions, we just hadn't thought of before because we were head down building a business trying to go make money.
• 27:31
  SPEAKER_00: But now we have a shift of the kind of environment of you know, private equity has a better, I think a better look and analytical look at businesses.
• 27:41
  SPEAKER_00: Uh, I think that's a lot of what happened to us, and I think what what they bring to a lot of founder-owned businesses in the beginning.
• 27:47
  SPEAKER_00: And so we used all that.
• 27:48
  SPEAKER_00: And so what changed?
• 27:49
  SPEAKER_00: Everything changed.
• 27:50
  SPEAKER_01: If you're ever thinking about selling your company, the due diligence part of the process is one of those things that, you know, to quote Drew, it just sucks.
• 28:00
  SPEAKER_01: And I love his idea in this episode.
• 28:06
  SPEAKER_01: He essentially says, after learning the first time, we just documented all the diligence questions and we started building it into our everyday routine.
• 28:16
  SPEAKER_01: And so I actually talked about this to the founders that we work with.
• 28:20
  SPEAKER_01: The founders that are looking to sell, whether it's a year, two years down the road, or even if it's just to make best practices for your company.
• 28:28
  SPEAKER_01: You can usually learn a huge amount about your business just by maintaining these kinds of logs of information that buyers are looking for.
• 28:38
  SPEAKER_01: So we created a free download where you can look at all the diligence questions that are very common in the process, and you can start to build a folder system at your company and start to keep track of it.
• 28:51
  SPEAKER_01: And so if you'd like it, just put a note in the show notes or send us an email at iconic founders.com and we'll make sure to get it over to you.
• 28:58
  SPEAKER_01: Thanks for joining us on the tour.
• 29:00
  SPEAKER_01: This episode with Drew is so packed with information that we broke it into two.
• 29:06
  SPEAKER_01: So please make sure you tune in next time when we finish the conversation.
• 29:10
  SPEAKER_01: Let's win it.