Latest / The Turn: Blue Collar to Billions / They Grew to $40M and Destroyed the Family Doing It

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They Grew to $40M and Destroyed the Family Doing It · The Turn: Blue Collar to Billions

• 0:00
  SPEAKER_01: My brother and I got into a physical altercation in the office.
• 0:04
  SPEAKER_01: In the like people, like we are laying on the floor wrestling, like breaking desks kind of stuff.
• 0:10
  SPEAKER_01: It didn't break anything, man, but like it was boo like it was loud.
• 0:14
  SPEAKER_01: And there was a customer in the office.
• 0:19
  SPEAKER_00: Welcome to the turn.
• 0:20
  SPEAKER_00: I'm Corey Mitchell with Iconic Founders.
• 0:23
  SPEAKER_00: Today we've got kind of a crazy episode.
• 0:26
  SPEAKER_00: Seth Zeller.
• 0:27
  SPEAKER_00: His dad and uncle started a business back when you did things on a handshake.
• 0:31
  SPEAKER_00: What they didn't do was plan for the future, where there would be the next generation.
• 0:36
  SPEAKER_00: Seven Zellers in a business of seven million dollars.
• 0:41
  SPEAKER_00: Sounds a little complicated, it was.
• 0:44
  SPEAKER_00: In the middle of all of it, it turned into a$40 million business, but it got messy.
• 0:50
  SPEAKER_00: This is the story of what happens when you don't make a plan from the beginning about when things get ugly.
• 0:58
  SPEAKER_00: So let's get into it.
• 1:00
  SPEAKER_00: Seth Zeller, welcome to the turn.
• 1:03
  SPEAKER_00: I think our viewers and listeners are gonna have a lot to learn from you, especially people that are in family businesses.
• 1:10
  SPEAKER_00: Maybe let's let's go back to the beginning, though.
• 1:13
  SPEAKER_00: Talk to us a little bit about your dad.
• 1:14
  SPEAKER_00: How did your dad get into the business?
• 1:16
  SPEAKER_00: You know, my dad um arguably lived a pretty difficult life.
• 1:21
  SPEAKER_01: He was one of four boys raised by a single mother.
• 1:24
  SPEAKER_01: He was a fighter, uh wrestler, um, just hard-nosed kids.
• 1:28
  SPEAKER_01: I think the trades probably resonated with him just because of that.
• 1:32
  SPEAKER_01: Like it's hard work, some discipline there that maybe you didn't get otherwise.
• 1:36
  SPEAKER_01: He and his brother, my uncle John, started the business like six months before my dad jumped on.
• 1:42
  SPEAKER_01: Tough time to start a business, arguably, right?
• 1:44
  SPEAKER_01: Coming in the early 80s, and interest rates are crazy.
• 1:48
  SPEAKER_01: They were just hard-working guys, man.
• 1:50
  SPEAKER_01: And his work ethic was, I would say, unparalleled.
• 1:53
  SPEAKER_01: He just, just a beast.
• 1:56
  SPEAKER_00: Walk us through a little bit of your childhood.
• 1:58
  SPEAKER_00: Tell us kind of where where you fit into the family and what your childhood was like growing up in a business like that.
• 2:05
  SPEAKER_00: My dad worked a lot, right?
• 2:07
  SPEAKER_01: I mean, he was weekends, he'd be down at his desk doing takeoffs.
• 2:11
  SPEAKER_01: He'd be gone before we got up for school, and he wouldn't get home till probably after we got back from practice, right?
• 2:17
  SPEAKER_01: So it seemed like he was just on 12, 14-hour days.
• 2:22
  SPEAKER_01: It just worked really hard.
• 2:23
  SPEAKER_01: And I'm one of four boys.
• 2:24
  SPEAKER_01: So the legend has it that there wasn't a female Zeller born for like a hundred years.
• 2:30
  SPEAKER_01: So my grandpa was one of four boys, my dad was one of four boys, I was one of four boys.
• 2:34
  SPEAKER_01: We fought a lot, man.
• 2:36
  SPEAKER_01: We have intense personalities in our family, competitive, but love my childhood, man.
• 2:40
  SPEAKER_01: We had a great childhood.
• 2:41
  SPEAKER_01: My mom was a stay-at-home mom.
• 2:43
  SPEAKER_01: She loved us well, taught us a lot about hard work.
• 2:47
  SPEAKER_01: My mom was a great balance to my dad.
• 2:50
  SPEAKER_01: My mom was definitely a lover and let us speak and she listened well.
• 2:55
  SPEAKER_01: Uh, so we just we I think we had a great balance.
• 2:58
  SPEAKER_01: You know, there's this phrase that I hear from coaches nowadays, and it was kind of like uh, nobody cares, get better, right?
• 3:04
  SPEAKER_01: My dad didn't have a father around.
• 3:07
  SPEAKER_01: So he was, I would say, in many ways, tough love.
• 3:10
  SPEAKER_01: And that's kind of, I felt like epitomized my childhood.
• 3:14
  SPEAKER_01: We were just hard workers, dedicated, disciplined, and just fought to win.
• 3:18
  SPEAKER_01: That was just feels like that's who we are.
• 3:21
  SPEAKER_00: So walk us through your story.
• 3:22
  SPEAKER_00: Like, how do you end up in the business?
• 3:25
  SPEAKER_01: The term I would use is I was kind of a jagoff.
• 3:27
  SPEAKER_01: I was a relatively smart kid.
• 3:30
  SPEAKER_01: I was a I was an athlete.
• 3:31
  SPEAKER_01: I played a little bit of college sports, but didn't know what I wanted to do.
• 3:36
  SPEAKER_01: I bounced around, I partied and uh I liked girls, and that was kind of my focus instead of basketball and education.
• 3:43
  SPEAKER_01: It was supplanted by just short-term vision.
• 3:48
  SPEAKER_01: So uh finally, I when I graduated, you know, um, with a business administration degree, I was like, whatever's the most generic degree I could get.
• 3:56
  SPEAKER_01: And I remember interviewing for some jobs and sales, and like I can't find anything that resonates.
• 4:02
  SPEAKER_01: And I go, hey dad, can I have a job?
• 4:05
  SPEAKER_01: And he's like, Yeah, you you know, I could use some help.
• 4:08
  SPEAKER_01: We'll see how it goes.
• 4:09
  SPEAKER_01: And so, yeah, 2001, 2002, I joined the company full-time as like what I called an apprentice estimator and project manager.
• 4:17
  SPEAKER_01: So I worked under my dad for a good 10 years, five years of that.
• 4:22
  SPEAKER_01: Like, I was really learning the business.
• 4:24
  SPEAKER_01: I grew up in the business, but I wasn't the handsy type.
• 4:28
  SPEAKER_01: I had two brothers that were really, really hand-oriented, learned through doing um in that aspect and really mechanically inclined.
• 4:38
  SPEAKER_01: I was not.
• 4:39
  SPEAKER_01: I wanted to think, I wanted to dream.
• 4:41
  SPEAKER_01: So apprenticing under him taught me a lot.
• 4:43
  SPEAKER_01: And he was not, I would say, I would have said going through it, like he wasn't a good teacher.
• 4:48
  SPEAKER_01: But as I've reflected and as I've gotten older, I'm like, I learned so much from him and just how he approached it, his focus on just like high ethics and like how that plays out in life, or he did not compromise at all.
• 5:05
  SPEAKER_01: He was stringent on his beliefs and really respect that and appreciated that in him, probably the most of anything.
• 5:13
  SPEAKER_00: Give us the the dynamics.
• 5:15
  SPEAKER_00: Does your dad own the business at this point?
• 5:16
  SPEAKER_00: Are there other owners?
• 5:18
  SPEAKER_01: My father and uncle were 50-50 partners and they worked well together.
• 5:23
  SPEAKER_01: They weren't great businessmen, but their legacy of like just integrity and doing the right thing permeated our market.
• 5:30
  SPEAKER_01: People knew then that we're gonna go to Dave and John Zeller and we're gonna get what is best and what is right.
• 5:37
  SPEAKER_01: And then four boys in my family, four boys in my uncle's family, and all four boys in my uncle's family came into the business.
• 5:45
  SPEAKER_01: Only two of us in our side came to the business.
• 5:48
  SPEAKER_01: I was kind of like last in in a way.
• 5:50
  SPEAKER_01: Went to college and my cousins were kind of got in right after high school.
• 5:54
  SPEAKER_01: My brother got in right after high school.
• 5:56
  SPEAKER_01: When five second genners enter the business, it became difficult because their 50-50 partnership worked so well, they thought, hey, we're family.
• 6:08
  SPEAKER_01: This should work well.
• 6:09
  SPEAKER_01: As everyone knows, when more opinions are added, and it's kind of that uh delegation by committee.
• 6:14
  SPEAKER_01: It's hard, it doesn't work well.
• 6:16
  SPEAKER_01: 50-50 partnerships don't work well typically, in my opinion.
• 6:21
  SPEAKER_01: And I started to see fraction, and arguably it's probably because of me, because I was different than all my cousins and my brother, and that I went to school.
• 6:30
  SPEAKER_01: I was this kind of um more theoretical visionary thinker, and they were like, hey, butt in the seat, work hard, that's all we do, right?
• 6:40
  SPEAKER_01: We're gonna people will respect that, and so there's always that just uh innate conflict and and and how we approach business and how we look at at work.
• 6:50
  SPEAKER_00: I want to thank everyone who has been tuning into the turn.
• 6:54
  SPEAKER_00: It's been super fun for me.
• 6:55
  SPEAKER_00: We're already on 10 episodes, I've got a whole bunch more filmed, I've got some great stories coming up.
• 7:01
  SPEAKER_00: So, for the algorithm, please do like and subscribe and send this to a friend that you think would enjoy it.
• 7:07
  SPEAKER_00: I just love to see the energy that the turn is generating.
• 7:11
  SPEAKER_00: And I can also tell by so many people that reach out to me on LinkedIn and from our website.
• 7:16
  SPEAKER_00: So thanks for everything you've done so far and continue to watch the turn.
• 7:22
  SPEAKER_00: How'd you divide the equity up?
• 7:23
  SPEAKER_00: We got seven zealers here.
• 7:25
  SPEAKER_00: Uh, this sounds complicated as hell.
• 7:27
  SPEAKER_01: Yeah, so my father and uncle decided that they would start giving 2% a year to each of us, the five, right?
• 7:35
  SPEAKER_01: So 2% a year over five years, we got 50% of the business.
• 7:39
  SPEAKER_01: And uh at that point, then we would talk about okay, how do we how do we finalize the the final 50%?
• 7:46
  SPEAKER_01: Because I pushed, I was I pushed envelopes, I asked hard questions, I feel like, and um when we hit 50% after five years, I go to the second gym.
• 7:57
  SPEAKER_01: I'm like, hey, all right, guys, it's our time.
• 7:59
  SPEAKER_01: Like, let's buy them out.
• 8:00
  SPEAKER_01: And everybody's like, whoa, whoa, Seth, like I'm ready when my dad's ready.
• 8:04
  SPEAKER_01: You know, I'm not gonna force them out, I'm not gonna push them out.
• 8:07
  SPEAKER_01: And I'm like, I'm not pushing them out.
• 8:08
  SPEAKER_01: I'm just saying, like, now's the time.
• 8:11
  SPEAKER_01: Like, we got it.
• 8:13
  SPEAKER_01: We've kind of leading the charge, we have the contacts now.
• 8:16
  SPEAKER_01: Like, it's it's time to do it.
• 8:18
  SPEAKER_01: And and that was that created friction, right?
• 8:20
  SPEAKER_01: Because I wanted to push envelope, I wanted to get things done.
• 8:23
  SPEAKER_01: We obtained majority control.
• 8:26
  SPEAKER_01: And uh some of my partners in the second gen just didn't feel comfortable doing that.
• 8:31
  SPEAKER_01: And uh just misalignment again is what kind of fostered you know some of the troubles of the second gen and seven zealers owning a small business, right?
• 8:42
  SPEAKER_01: We were essentially seven million dollar business with seven owners.
• 8:47
  SPEAKER_00: There's not a lot of uh to pass around.
• 8:50
  SPEAKER_00: Did your dad and brother did they make it clear what they actually wanted for the sons?
• 8:56
  SPEAKER_01: No, no, we didn't have a structure.
• 8:59
  SPEAKER_01: I would say everybody wanted to be an owner, and they liked that as the job title.
• 9:04
  SPEAKER_01: My philosophy was like owner's not a job title, and we need clarity of role, clarity of leadership.
• 9:10
  SPEAKER_01: My dad and uncle didn't really create a succession plan.
• 9:14
  SPEAKER_01: They didn't have like they didn't tag anybody as like the next like leader that was like, we're family, we'll make it work, right?
• 9:21
  SPEAKER_01: And that that was kind of the mentality.
• 9:23
  SPEAKER_01: And they weren't growth oriented, they that that wasn't how their minds worked, right?
• 9:27
  SPEAKER_01: It was just like work hard, maintain a good reputation, love people, right?
• 9:34
  SPEAKER_01: Do what's right, and uh they thought it should just work.
• 9:38
  SPEAKER_00: How do you get from that point to sort of the final ownership structure over the coming years?
• 9:45
  SPEAKER_01: When I started pushing, um I met with the second gen, right, when we had 50%.
• 9:51
  SPEAKER_01: I I I had an offer.
• 9:53
  SPEAKER_01: Um, how I remember it is I was like, we had dinner.
• 9:56
  SPEAKER_01: I remember the place, and I said, Hey guys, I think I think we need to finalize this.
• 10:00
  SPEAKER_01: I think we need to buy out you know, dad and John, and I think we just do it lump sum, like let's just get done now.
• 10:08
  SPEAKER_01: We can take out a loan, and uh we'll finalize that.
• 10:11
  SPEAKER_01: And they pushed against it a little bit, and I said, Hey, you know what?
• 10:14
  SPEAKER_01: If if you're not on board um with doing this, I get it.
• 10:19
  SPEAKER_01: But I think we need two things.
• 10:20
  SPEAKER_01: One, I think we need to buy out Dad and John, and two, I think we need clear leadership.
• 10:25
  SPEAKER_01: And I said, I think I'm that guy for this.
• 10:28
  SPEAKER_01: Some nodded, right?
• 10:30
  SPEAKER_01: Uh and uh some were like, no, we're not doing this.
• 10:34
  SPEAKER_01: Uh that kind of started kind of what you you know, I don't know, the uh precipitated uh what became a buyout and a conflict, but what a buyout of in 2015, um, a buyout of my uncle, uh my dad, and the other two owners.
• 10:52
  SPEAKER_01: So yeah, we we bought out everybody in 2015.
• 10:56
  SPEAKER_01: On your uncle, his whole side's out.
• 10:58
  SPEAKER_01: Man, it was messy, I think.
• 11:00
  SPEAKER_01: Disagreements, you know, we're an aggressive family.
• 11:03
  SPEAKER_01: There's there were some really loud and hard conversations.
• 11:08
  SPEAKER_01: It didn't go well at all.
• 11:10
  SPEAKER_01: In hindsight, right, there's always opportunities to handle things differently.
• 11:14
  SPEAKER_01: Um, there's always like, you know, I don't like the term, but there's always regret in how you approach things.
• 11:20
  SPEAKER_01: I know I could have done things better, but um yeah, we bought all of them out, and I I know that really that really hurt my uncle.
• 11:29
  SPEAKER_01: And we probably said and did things that he viewed as just maybe unethical.
• 11:34
  SPEAKER_01: Maybe he viewed them as like, you know, I can't believe you guys are doing this to me and my family.
• 11:38
  SPEAKER_01: Uh that wasn't the intent.
• 11:40
  SPEAKER_01: It was just like we we look at things differently.
• 11:42
  SPEAKER_01: How are we gonna get how are we each gonna get what we want?
• 11:46
  SPEAKER_01: And those are conversations I had a lot, I feel like, was like, what do you want out of this business?
• 11:51
  SPEAKER_01: What what are your views?
• 11:52
  SPEAKER_01: What do you what are your long-term aspirations and goals?
• 11:56
  SPEAKER_01: So we brought in consultants and I brought in confidants from myself and asking questions on what this should look like.
• 12:03
  SPEAKER_01: And uh yeah, it just did not go well.
• 12:06
  SPEAKER_01: There was hurt, there was anger.
• 12:08
  SPEAKER_01: My my cousins and my uncle then started a actually a competitor.
• 12:13
  SPEAKER_01: They they started a new contracting firm uh right in our backyard.
• 12:17
  SPEAKER_01: There's just that added conflict there and added stress on who's gonna go where and who wants to be part of our vision.
• 12:25
  SPEAKER_01: It was so intense, it was so emotional.
• 12:29
  SPEAKER_01: People say you see red.
• 12:31
  SPEAKER_01: I I just think you just don't see sometimes, right?
• 12:37
  SPEAKER_00: It's so critical how you structure a business from the start.
• 12:41
  SPEAKER_00: I've got my own version of this right now.
• 12:44
  SPEAKER_00: I'm in a business where I was a little bit sloppy.
• 12:47
  SPEAKER_00: I didn't really set up an operating agreement because I trusted a friend to do the right thing.
• 12:52
  SPEAKER_00: But guess what?
• 12:53
  SPEAKER_00: It doesn't always go well.
• 12:55
  SPEAKER_00: And that's kind of what happened in Seth's story.
• 12:58
  SPEAKER_00: His dad and his uncle didn't really set up a succession plan, they didn't have a proper operating agreement, they just figured the next generation is gonna figure it out.
• 13:07
  SPEAKER_00: In the meantime, business kept growing.
• 13:12
  SPEAKER_00: There's no natural leader in the business.
• 13:14
  SPEAKER_00: Seth, he kept pushing.
• 13:17
  SPEAKER_00: And that push, while it was successful in the sense that he became the leader of the business, it created tremendous resentment.
• 13:25
  SPEAKER_00: And with resentment, the business started to break down, and at the same time, those family ties got very fractured.
• 13:35
  SPEAKER_00: I want to learn a little bit more about your brother.
• 13:38
  SPEAKER_00: So you end up in business with your brother.
• 13:40
  SPEAKER_00: Did he stay in the business the whole time when you're off gallivanting and doing your school stuff and figuring out yourself?
• 13:47
  SPEAKER_01: He was in the business probably at least he's younger, he's two years younger in age.
• 13:52
  SPEAKER_01: So I was number two, and he was number three in the family.
• 13:56
  SPEAKER_00: Where I'm going is I want to see how he felt about you going away.
• 14:00
  SPEAKER_00: You're the schoolboy, Mr.
• 14:02
  SPEAKER_00: Smarty Pants, visionary, you got your big ideas, and now you come back.
• 14:07
  SPEAKER_00: I I worked my ass off in the business.
• 14:11
  SPEAKER_00: So I want to I want to dig a little bit into that dynamic and how the two of you saw eye to eye to become partners.
• 14:18
  SPEAKER_01: Right.
• 14:18
  SPEAKER_01: Yeah.
• 14:19
  SPEAKER_01: I think it was just blindly, you're my brother, I love you, we'll figure it out.
• 14:25
  SPEAKER_01: I think both of both of us probably thought that, right?
• 14:28
  SPEAKER_01: Growing up, we were fighters.
• 14:29
  SPEAKER_01: We were just aggressive and wanted to win in everything we did.
• 14:33
  SPEAKER_01: And he was like that too.
• 14:34
  SPEAKER_01: I mean, that kid just fought all the time.
• 14:36
  SPEAKER_01: I think uh there's competition there, right?
• 14:39
  SPEAKER_01: And there's that just innate competitiveness of athletes or boys, males.
• 14:46
  SPEAKER_01: So we fought a lot.
• 14:47
  SPEAKER_01: I just feel like there's just always conflict.
• 14:49
  SPEAKER_01: Uh and that was burning me out.
• 14:52
  SPEAKER_00: Where did the ownership percentages end up?
• 14:54
  SPEAKER_00: We got the two of you and this the non-family member.
• 14:57
  SPEAKER_01: Yeah, 33% each.
• 15:00
  SPEAKER_01: So across the board.
• 15:01
  SPEAKER_01: Okay.
• 15:01
  SPEAKER_01: So you're equal.
• 15:02
  SPEAKER_01: Um, yeah, yeah, yeah.
• 15:04
  SPEAKER_00: And how did the how did you get along with the non-family member versus your brother?
• 15:09
  SPEAKER_00: I'm just wondering how that dynamic shook out over time.
• 15:13
  SPEAKER_00: Brian is his name, great guy, man.
• 15:16
  SPEAKER_01: Uh, salt of the earth, hard worker, very mechanically inclined, a great electrician.
• 15:23
  SPEAKER_01: That dude could figure anything out, man.
• 15:25
  SPEAKER_01: But he was he was also a passive and he didn't like conflict, didn't handle conflict well.
• 15:32
  SPEAKER_01: And so my brother and I, oh man, I mean, my brother and I are just bam, bam, and he's he just didn't know how to approach that, didn't know how to handle that.
• 15:41
  SPEAKER_01: And yeah, as much as we wanted him to be that tie break and that kind of he was older than us, about a decade older.
• 15:48
  SPEAKER_01: We wanted him to engage in a manner that was a leading voice and like and and conflict resolution, and that was just not his nature.
• 15:57
  SPEAKER_01: So we have one guy that's pitted, you know, oftentimes in discussions or in strategic planning against one or the other and doesn't know how to respond.
• 16:06
  SPEAKER_00: And that that conflict just I'm sure killed him.
• 16:10
  SPEAKER_00: And let's talk about some of the wins, right?
• 16:12
  SPEAKER_00: You talked about being$7 million in revenue, seven owners.
• 16:15
  SPEAKER_00: Now you've got three owners, 33% apiece.
• 16:18
  SPEAKER_00: What are some of the things you did over the coming years that were a success story?
• 16:24
  SPEAKER_00: And tell us about your growth and some of the things that really worked in your business.
• 16:29
  SPEAKER_00: I think we all were hungry.
• 16:31
  SPEAKER_01: My ability to bring about like that that vision and that and trying to clarify that and then pushing the envelope to be different in our market was helpful and balanced out their just desire to like, we're just gonna go to work, man.
• 16:44
  SPEAKER_01: Like, that's what we do.
• 16:45
  SPEAKER_01: We're gonna work hard and we're gonna have high standards and expectations of ourselves and of our team.
• 16:51
  SPEAKER_01: So there was wins there, you know.
• 16:53
  SPEAKER_01: And I I would say even in spite of ourselves in that conflict, we grew.
• 16:58
  SPEAKER_01: We um we we kept trying to get better, just taking different approaches and how that looked.
• 17:04
  SPEAKER_01: You know, my brother uh um in some ways is a visionary, um, but he but he doesn't know how to put that into practice.
• 17:13
  SPEAKER_01: And um, but his his mind on building a job and the efficiencies he created, um, just and how he did things, uh he was really good.
• 17:24
  SPEAKER_01: I mean, he was a really good job runner.
• 17:26
  SPEAKER_01: And the other partner, again, like was just mechanically inclined.
• 17:30
  SPEAKER_01: Um, his experience was vast and he could just problem solve.
• 17:34
  SPEAKER_01: And um, so those those three combinations of kind of that visionary aspect for the field, that visionary aspect for the overall company, and then that just kind of problem solving aspect were complementary in many ways.
• 17:47
  SPEAKER_01: So there's wins.
• 17:48
  SPEAKER_00: We learn from each other, I believe.
• 17:50
  SPEAKER_00: Well, at this point, are you the clear leader of the company?
• 17:53
  SPEAKER_00: You talked about that earlier, but we didn't actually finalize that thought who the who the leader was.
• 17:59
  SPEAKER_01: I think there's always that when you have a partnership, there's always that person um that we want what someone else has.
• 18:08
  SPEAKER_01: And we think that, you know, it's that grass is greener narrative, right?
• 18:11
  SPEAKER_01: And we think that I want to be that I used to say a lot, like, you know, everybody wants to wear the big boy pants.
• 18:17
  SPEAKER_01: It's just nobody wants to actually put them on.
• 18:19
  SPEAKER_00: What specifically did you do to grow the business?
• 18:22
  SPEAKER_00: You know, not many businesses grow above 10 million in revenue.
• 18:25
  SPEAKER_00: You grow this business to what 40 million over time?
• 18:29
  SPEAKER_00: Yeah.
• 18:29
  SPEAKER_00: That's a hell of a business.
• 18:31
  SPEAKER_01: Yeah.
• 18:32
  SPEAKER_01: Thank you.
• 18:33
  SPEAKER_01: We took over in 2015.
• 18:35
  SPEAKER_01: By 2019, 20, uh, right around COVID, we grew.
• 18:40
  SPEAKER_01: That's when we grew.
• 18:41
  SPEAKER_01: Uh, we went to 20, about 28 million.
• 18:43
  SPEAKER_01: We grew through, you know, I brought in consultants.
• 18:46
  SPEAKER_01: I brought in uh a guy I met through um some friends and mentors, uh, a guy named Jack O'Reilly.
• 18:53
  SPEAKER_01: He was a consultant for good the great game of business.
• 18:56
  SPEAKER_01: I just I didn't know much about the great game.
• 18:59
  SPEAKER_01: I knew I needed someone to speak into our team and into our leadership team to like clarify and help us think through strategic planning and who should be where and what people should be doing.
• 19:12
  SPEAKER_01: So we did that, and that helped.
• 19:15
  SPEAKER_01: That that gave us a really focus on financials and financial literacy.
• 19:18
  SPEAKER_01: So we grew as a team in that way.
• 19:20
  SPEAKER_01: So I consulting and just outside opinions were helpful.
• 19:24
  SPEAKER_01: I started joining like CEO clubs.
• 19:27
  SPEAKER_01: I joined eventually I got into YPO.
• 19:31
  SPEAKER_01: We then uh before YPO and after we did the great game, we started kind of looking at um another consultant, and he was he was more uh you know a combiner of all things consulting and just a kind of a family conflict whisperer that would really help us.
• 19:49
  SPEAKER_01: That worked for a while, and that we actually he actually fired us because as a client.
• 19:55
  SPEAKER_01: Yeah, we just fought, and he's like, I'm tired of this, guys.
• 19:58
  SPEAKER_01: You guys are going nowhere, you're not listening to me, I'm done with you.
• 20:01
  SPEAKER_01: And then we started trying to implement EOS, and you know, we tried to self-implement, and I knew we needed somebody to walk us through that because we just we're so divided in our thought process on how uh that we needed somebody to kind of tell us and speak into that.
• 20:17
  SPEAKER_01: So we started implementing EOS, used a guy named Chris Carmouche, he's another YPOer, and we uh we continued to grow, we got better, and we were implementing process.
• 20:28
  SPEAKER_01: Those consultants were huge in helping us grow, in my mind.
• 20:33
  SPEAKER_01: But process, uh the learning about finances and and financial being like a cornerstone of any business, and and that's the thing with trades, right?
• 20:42
  SPEAKER_01: I think the people in the trades, hey, we're a good good electrician, I can do, I can, I can start my own business, right?
• 20:48
  SPEAKER_01: I'm a good plumber.
• 20:49
  SPEAKER_01: Why can't I do this by myself?
• 20:52
  SPEAKER_01: And the lack of understanding or education or financial literacy, I think is a downfall of tons of small businesses.
• 21:00
  SPEAKER_01: They just they don't understand whip, they don't understand the meaning of cash flow, right?
• 21:04
  SPEAKER_01: You can be as profitable as you want, but if you don't have good cash flow, you're gonna go bankrupt and go out of business.
• 21:10
  SPEAKER_01: So that inadvertently and unknowingly, we we we started the great game business and we that helped as a catalyst in our understanding of finances and our focus on our numbers.
• 21:21
  SPEAKER_01: And then tacking on, uh, we probably should have done it earlier, but tacking on EOS where process becomes the another catalyst, right?
• 21:29
  SPEAKER_01: Understand finances, and then how do we put these things into process that we learned from financial literacy?
• 21:34
  SPEAKER_01: How do we process this to become more efficient too?
• 21:38
  SPEAKER_01: And that was helpful.
• 21:39
  SPEAKER_01: So we started seeing EOS like, hey, we need like, what is a good job description for an estimator?
• 21:45
  SPEAKER_01: And what are their true measurables that that really move them along to getting better?
• 21:51
  SPEAKER_01: And EOS helped us develop that and think through you know, how do we structure our business and why do we structure it that way?
• 21:59
  SPEAKER_01: That was Huge for us.
• 22:01
  SPEAKER_01: I think that trying to get alignment, knowing why we're in business, our purpose statement was simple and succinct, and I love that.
• 22:09
  SPEAKER_01: Like just simplicity of why you're doing something is important, right?
• 22:14
  SPEAKER_01: And you know, one consultant told us, uh, you guys are growing in spite of yourselves.
• 22:20
  SPEAKER_01: I think we grew obviously a combination of things, but one of my philosophies, and I and I used to get made fun of for sure, but like I always kind of took to heart and lived out in many ways this I'm gonna dress for the job I want, not the job I have.
• 22:39
  SPEAKER_01: So I was that guy walking onto a job site, not in, I mean, I would have construction boots on, right?
• 22:45
  SPEAKER_01: Steel toe, but I'm wearing like khakis, a sport coat, button down, wearing a, you know, bringing a nice bag over my shoulder, like a backpack with all everything I need, right?
• 22:57
  SPEAKER_01: I love people.
• 22:58
  SPEAKER_01: I really enjoy meeting new people.
• 23:00
  SPEAKER_01: And the focus on developing relationships, I think relationship was a catalyst to our growth.
• 23:07
  SPEAKER_00: Here's the thing about conflict in a family business.
• 23:11
  SPEAKER_00: It doesn't stay in the boardroom, it follows you to the kitchen table, to Christmas dinner.
• 23:17
  SPEAKER_00: It makes life outside of the business really, really hard.
• 23:21
  SPEAKER_00: And that's what happened here.
• 23:23
  SPEAKER_00: Seth spent years trying to find out the answer to the questions that plagued them.
• 23:28
  SPEAKER_00: And in the meantime, they just figured out it might be time to exit.
• 23:32
  SPEAKER_00: But the path to exit, it was just as ugly.
• 23:37
  SPEAKER_00: Let's move to kind of the next phase here where things break down and you're now not in the business anymore.
• 23:44
  SPEAKER_00: It started when I pushed the envelope and said, let's let's buy out our let's buy out the first gen.
• 23:50
  SPEAKER_01: Let's buy out dad, let's buy out Uncle John.
• 23:52
  SPEAKER_01: The fractures really started to become evident then.
• 23:55
  SPEAKER_01: Maybe it brought it maybe to more the forefront where we saw, like, I saw specifically that we just weren't aligned.
• 24:03
  SPEAKER_01: We didn't uh philosophically agree with what this should look like.
• 24:08
  SPEAKER_01: So Luke and Brian, I think they they nodded in agreement in 2015, and I think their hearts were far from that.
• 24:16
  SPEAKER_01: I I think that they said, yeah, we'll do it because Seth's gonna leave otherwise, and there's benefit to the company that he brings, and we don't want to lose that now.
• 24:25
  SPEAKER_01: So we'll we'll go, we'll just see how this plays out, right?
• 24:28
  SPEAKER_01: So the fractures and the conflict, I think, really were were probably you know brushed under the rug, but they were evident.
• 24:35
  SPEAKER_01: And as I continue to push like growth and push a vision, I more and more realized that we just we weren't aligned.
• 24:43
  SPEAKER_01: I can't even speak the number of conflicts that my brother and I had.
• 24:46
  SPEAKER_01: I mean, really transparent, man, like to my shame and embarrassment, my brother and I got into a physical altercation in the office.
• 24:57
  SPEAKER_01: In the like people like in our office was designed differently.
• 25:01
  SPEAKER_01: Like breaking desks kind of stuff.
• 25:03
  SPEAKER_01: Well, it didn't break anything, man, but like it was boat, like it was loud, and there was a customer in the office, and it was just we we are laying on the floor, wrestling, hands raised.
• 25:17
  SPEAKER_01: Our accounting manager has to come into my office where we're at and and physically break us apart.
• 25:23
  SPEAKER_01: You know, there's things like that, there was like opportunities like where there were some things that weren't handled well.
• 25:30
  SPEAKER_01: I have employees now coming to me saying, hey man, your brother did this.
• 25:34
  SPEAKER_01: Again, perspective is key, right?
• 25:37
  SPEAKER_01: And and there's always two sides to the story.
• 25:40
  SPEAKER_01: But one I'm kind of again ashamed of is that I tried to take advantage of that situation.
• 25:45
  SPEAKER_01: I don't think I handled it with the correct perspective.
• 25:49
  SPEAKER_01: Where I I came at it with probably a heart of like, in some ways, maybe vengeance, where I it's like, okay, I can get him out.
• 25:56
  SPEAKER_01: I can I can relieve this conflict by pushing him out because of this situation.
• 26:01
  SPEAKER_01: So I approached it probably a little bit incorrectly, although I think I was right in some of the things I tried to do and say.
• 26:09
  SPEAKER_01: I my heart was not right.
• 26:11
  SPEAKER_00: So this started from a point of view trying to get him out of the company.
• 26:15
  SPEAKER_00: I started trying to like, I I don't want to be in partnership with these guys.
• 26:23
  SPEAKER_01: And I would I would think they don't want to be in partnership with me.
• 26:26
  SPEAKER_01: But yeah, I started to probably do things and lean away that I how do I get out of this?
• 26:33
  SPEAKER_01: Whether they exit or I exit, I don't think I cared.
• 26:36
  SPEAKER_01: But if an opportunity arose, I kind of focused on taking advantage of that, and that's wrong, right?
• 26:43
  SPEAKER_01: I that's again shameful.
• 26:45
  SPEAKER_01: Uh, you know, I hindsight's 2020, but man, I would I'd do things differently.
• 26:51
  SPEAKER_01: Although my desires were tainted, I do think that it something needed to happen.
• 26:57
  SPEAKER_01: And um ultimately I think I'm in the right place now, right?
• 27:01
  SPEAKER_01: I've exited the business.
• 27:02
  SPEAKER_01: Hopefully, we built a foundation that continued from the legacy of my dad and uncle that is sustainable for the next generation, for my brother's kids.
• 27:12
  SPEAKER_00: And now a little bit about our sponsor.
• 27:15
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• 27:20
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• 27:22
  SPEAKER_00: I tell all the businesses I work with, keep your guys hydrated.
• 27:27
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• 27:30
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• 27:32
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• 27:33
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• 27:34
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• 27:37
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• 27:39
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• 27:42
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• 27:44
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• 27:45
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• 27:52
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• 27:54
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• 27:58
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• 28:00
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• 28:05
  SPEAKER_00: How did it all go down and and how'd you end up out of the business?
• 28:09
  SPEAKER_01: Numerous iterations.
• 28:10
  SPEAKER_01: That first one, 2015, again, probably in 2019, 20, 2021, I offered to leave again after that physical altercation.
• 28:20
  SPEAKER_01: I was accused by I felt like numerous family members that I've I was accused of being greedy and power hungry, um, selfish.
• 28:32
  SPEAKER_01: And you know, I mean, I probably correct in many ways.
• 28:38
  SPEAKER_01: But I think the overarching desire was just to like eliminate the conflict that I felt like I had dealt with.
• 28:44
  SPEAKER_01: He was gonna buy me out, I was gonna buy him out.
• 28:46
  SPEAKER_01: We brought in a mod a mediator to try and do this, a pastor, local pastor to try and help us work through this negotiation.
• 28:54
  SPEAKER_01: That didn't go well.
• 28:55
  SPEAKER_01: I said, hey, let's bring in a third party, let's have somebody buy us out.
• 28:58
  SPEAKER_01: That's easy, right?
• 28:59
  SPEAKER_01: We'll we'll relinquish, I'll I'll exit.
• 29:02
  SPEAKER_01: You can exit too.
• 29:04
  SPEAKER_01: We'll see what they say.
• 29:06
  SPEAKER_01: Uh that third party buyout went to like the one yard line and fell apart.
• 29:11
  SPEAKER_01: We didn't have a great year.
• 29:12
  SPEAKER_01: It changed our eBIT evaluation.
• 29:14
  SPEAKER_01: The multiplier wasn't great.
• 29:16
  SPEAKER_01: That fell through in uh basically December 2024, January 2025.
• 29:23
  SPEAKER_01: And so finally I came to it's like I can initiate the buyout through our buy sell and it can force that, and I'm gonna be okay if I exit.
• 29:33
  SPEAKER_01: And so then that process started in February of 2025.
• 29:37
  SPEAKER_01: I I would say the you know 2025 went well.
• 29:40
  SPEAKER_01: Disagreement on the interpretation of the buy sell.
• 29:43
  SPEAKER_01: We had uh different opinions on the uh valuation, but ultimately I finally got bought out in 20 uh August 22nd.
• 29:52
  SPEAKER_00: How did you reach a valuation?
• 29:54
  SPEAKER_00: And and are you happy with the number that you got bought out at?
• 29:57
  SPEAKER_01: I thought the valuation was low, in my opinion, right?
• 30:01
  SPEAKER_01: I thought we had built a really good business.
• 30:03
  SPEAKER_01: My brother actually thought it was high.
• 30:05
  SPEAKER_01: I thought it was low, but we agreed at the beginning, and that's kind of how the buy-sell read, is like if you're gonna do this, then you're agreeing to whatever the valuation is.
• 30:15
  SPEAKER_01: And I was like enough that I had I wanted to remove the conflict, so I wanted to exit the business.
• 30:22
  SPEAKER_01: Finally, we I just said I'm I'm done.
• 30:23
  SPEAKER_01: I I can I can do this myself, I can force the buyout, I'm I'm gonna take it.
• 30:28
  SPEAKER_00: If you had to give people advice on crafting a buyout, what would you advise?
• 30:35
  SPEAKER_01: You need to make sure you have a good attorney that crafts the right buy sell and that really understands all shareholders because ultimately what the buy sell should do is it should alleviate conflict, not add to it.
• 30:50
  SPEAKER_00: So don't assume anything.
• 30:52
  SPEAKER_01: I say that because I think like it's okay to go on the side of the buy sell, but you have to have real clarity in how that's gonna look.
• 31:01
  SPEAKER_01: And you're gonna have to be able to you're gonna have to be able to give as much as you receive, right?
• 31:07
  SPEAKER_00: Do you think that uh the fractures in your family will ever heal?
• 31:12
  SPEAKER_01: Man, I I hope and pray they do.
• 31:14
  SPEAKER_01: Yeah.
• 31:14
  SPEAKER_01: And those are the things you carry, right?
• 31:16
  SPEAKER_01: There's a lot of healing to do.
• 31:18
  SPEAKER_01: I think for both people, right?
• 31:19
  SPEAKER_01: I mean, I I got what I wanted in many ways, right?
• 31:23
  SPEAKER_01: But I was hurt by a by the process, I was hurt by the people involved, I was hurt by narratives that were put out.
• 31:31
  SPEAKER_01: And we believe my wife and I took an approach like not to engage, like family, because it's a business, and we wanted we wanted to really distinguish between the two.
• 31:44
  SPEAKER_01: And my brother and his wife took the opposite approach.
• 31:47
  SPEAKER_01: They engaged with my parents, created the narrative.
• 31:50
  SPEAKER_01: Their perspective is that I handled this wrong.
• 31:52
  SPEAKER_01: And my perspective is they handled it wrong.
• 31:55
  SPEAKER_01: And time doesn't heal much, but time to reflect and time to think through, and time to really like that self-uh evaluation that introspection needs to happen.
• 32:10
  SPEAKER_01: And that's just again another life lesson is like, you know, be aware, be self-aware, because if you're not, you're probably passing by tons of lessons, you're passing by really good quality life conversations if if you're not willing to look in inwardly and evaluate your motives.
• 32:29
  SPEAKER_01: But man, I think that's a long haul.
• 32:31
  SPEAKER_01: I mean, we decided we're not going on family vacations right now, and that hurts and kills my parents.
• 32:35
  SPEAKER_01: I know, man.
• 32:36
  SPEAKER_01: I mean, they just I bet they're extremely hurt by it.
• 32:39
  SPEAKER_01: But we need some time to kind of like circle the wagons and make sure we have our fire lit and make sure that we're, you know, supporting our nuclear family.
• 32:51
  SPEAKER_01: And once you're okay, right?
• 32:53
  SPEAKER_01: Once your heart and you you're you're okay with like what has happened is when that process of forgiveness and healing and even confession, right?
• 33:03
  SPEAKER_01: Just confessing that you screwed up, like those things need to happen.
• 33:07
  SPEAKER_01: And that's all part of that healing process.
• 33:09
  SPEAKER_01: And we just haven't reached that yet.
• 33:11
  SPEAKER_00: Yeah.
• 33:12
  SPEAKER_00: Well, now that you're out, you got quote unquote what you wanted, you're out of the business.
• 33:18
  SPEAKER_00: How does it feel?
• 33:19
  SPEAKER_00: You know, I feel good, but it's scary.
• 33:24
  SPEAKER_01: My confidence has wavered.
• 33:26
  SPEAKER_01: I think it's because of that self-reflection to think through like was I truly successful in my efforts and why.
• 33:35
  SPEAKER_01: It was kind of a mind screw, right?
• 33:37
  SPEAKER_01: And there's another four-letter word you can use that probably flows better than mind screw, but the other one's the one I used.
• 33:43
  SPEAKER_01: Yeah.
• 33:45
  SPEAKER_01: And it's been difficult to uh figure that out, but I I I'm on the right path and I'm excited for what is next, man.
• 33:54
  SPEAKER_01: I've had opportunities to join some other companies and run a few other companies, and this podcast is the beginning for me in many ways of healing because um I want to help people.
• 34:07
  SPEAKER_01: I want so bad to serve other people to help them be successful.
• 34:11
  SPEAKER_01: So I'm starting a consulting business.
• 34:13
  SPEAKER_01: I'm a be a growth coach.
• 34:16
  SPEAKER_01: There's a lot to learn, man.
• 34:17
  SPEAKER_01: And I'm I'm excited to learn.
• 34:19
  SPEAKER_01: I'm I believe I'm a career learner and I love to like hear people's experiences.
• 34:25
  SPEAKER_01: So I'm excited about the journey and uh cautiously optimistic that I'll be impactful for other people to see and realize their call and then just be able to live out that dream, right?
• 34:38
  SPEAKER_01: To just be able to live out what what they feel fulfills them.
• 34:41
  SPEAKER_00: Well, I'm glad we could be part of the journey with you.
• 34:44
  SPEAKER_00: I'm excited to see where you take it from here.
• 34:47
  SPEAKER_00: I've learned a lot uh talking to you today, Seth.
• 34:50
  SPEAKER_00: And my guess is uh for those of you listening, if you made it this far, uh I guarantee you there is something that you can learn from it.
• 34:58
  SPEAKER_00: Seth Zellard, thank you so much for joining us.
• 35:01
  SPEAKER_00: I'm grateful uh for your time today.
• 35:03
  SPEAKER_00: And until the next time, let's win.
• 35:06
  SPEAKER_00: Yeah, man.
• 35:06
  SPEAKER_00: Slay the day.
• 35:09
  SPEAKER_00: Here's the question I kept coming back to over and over with Seth.
• 35:13
  SPEAKER_00: What's the cost of the exit that you've been building towards?
• 35:18
  SPEAKER_00: He got out.
• 35:19
  SPEAKER_00: It was what he wanted, sort of.
• 35:23
  SPEAKER_00: Was it all worth it?
• 35:25
  SPEAKER_00: Here's a lesson I think that applies to every founder.
• 35:28
  SPEAKER_00: And I think this is really critical to listen to.
• 35:32
  SPEAKER_00: You have to structure the business right from the beginning.
• 35:35
  SPEAKER_00: Just because you might start with a family member or a close friend, things don't always go the way you think they will.
• 35:42
  SPEAKER_00: So you want to have an agreement that is sort of emotionless, that sometimes needs to be solved with lawyers.
• 35:51
  SPEAKER_00: You sort of need to plan for the breakup from the start.
• 35:55
  SPEAKER_00: And that may not sound like a lot of fun, but believe me, you want to make the deal when everyone in the room gets along.
• 36:04
  SPEAKER_00: You want to pre-plan the divorce.
• 36:06
  SPEAKER_00: Seth started with a$7 million business and seven owners.
• 36:11
  SPEAKER_00: The story ends with a$40 million exit and a clean slate.
• 36:15
  SPEAKER_00: That's a hell of a turn.
• 36:18
  SPEAKER_00: I'm Corey Mitchell.
• 36:20
  SPEAKER_00: Thanks for watching The Turn, a podcast by Iconic Founders Group.