Buyers and Builders
00:21:17 · Mikk, Nathan Lindley
[00:21:17] S0: care anymore, or how are you able to perform? [00:21:19] S1: No. It was it was absolutely counterproductive. I'm not... It was a bad way to handle it. Absolutely. And and even now, there's, like, you know, all this research coming out about how it spikes your cortisol, and and it just makes everything so much worse. And it absolutely does. You know, having obviously a deep faith background, I think there are there are, you know, spiritual ways of of handling things. But I was I wasn't handling it well. Let's just be totally honest. It was it was not my my proudest moment at all. And anyone anyone has... In fact, well, a good friend of mine right now is kinda going through that season right now. And so I'm I'm texting him daily just saying, hey, man. I'm here for you if you wanna talk, you know, and, you know, it's... It is horrible. And not everyone escapes bankruptcy. Sometimes that's part of the process. Was fortunate to not have to go through that, but that was a lot of what my Google searches were about at that point in time, know, especially with the SBA loan. [00:22:18] S0: You said you're very close with your father. What was he saying to you? [00:22:21] S1: My dad was so supportive, and he was just saying, hey. You know, if if worse comes to worse, you can move in with me, and we'll start over. You know? [00:22:30] S0: That's awesome.
00:22:30 · Mikk, Nathan Lindley
[00:22:30] S0: That's awesome. [00:22:31] S1: Yeah, it was awesome. I mean, remember too, his entire retirement was tied up in this. So that was the thing that was so much worse too, is it wasn't just me sinking my own financial future. It was me destroying my dad's retirement and my buddy's inheritance. It was... I was I was bringing down my loved ones with me. You know? It was it was awful. [00:22:50] S0: A lot to carry. [00:22:51] S1: Yes. Yes. A tremendous tremendous load. Yeah. It's awful. So [00:22:57] S0: Okay. But now you now you... We have we have Nathan who is a bit tired for last night drinking. So... But we have this guy from Indeed. So what's Yeah. What you what you guy what you guys were cooking?
00:23:13 · Nathan Lindley
[00:23:13] S1: So this was where things really started getting interesting. I, you know, I had I had four or five technicians who just couldn't even cover their own payroll. And then all of a sudden, I get this one guy who's on commission and he is out earning everybody else collectively. And at first, we... It just started out with a couple of really good days. I was like, wow, those are some good days. But then it turned into a couple of good weeks, and I started to realize that this was just kind of a new normal. And I I remember sitting down doing the math and figuring out that I could completely float the entire company off of this one guy's revenue and realizing that if this was as good as it got, I could at least not go bankrupt. As long as this guy worked for me long enough to pay off my SBA loan, I could at least get out of this empty handed, you know, but not bankrupt, which was... That was actually a huge improvement. And and what it showed me was the importance of alignment of incentives because this guy won when I won and I won when he won and and and we both lost together. And so our bad days were bad together, and our good days were good together. And so so that was such a huge change versus my hourly techs who they were gonna make their paycheck kinda regardless of what happened today. As long as they kept their butt in that truck for a full eight hours, they were gonna get their their paycheck for the day. And so they were ultimately indifferent to the outcome of of their appointments. And so that was just a massive shift and it and it showed very clearly in the performance. And so so that was that was kind of the the the inflection point for us where it went from staring bankruptcy in the face to all of a oh, I think I could see a road map for how we could start making money. The other thing that it did too is it caused our payroll to fluctuate with our revenue. And that was always the thing that was so frustrating before is we'd have a $20,000 payroll and we bring in $10,000 that week. Then we have a $20,000 payroll and we bring in $40,000 that week. And so there's just no correlation to anything. And so by putting everyone on on commission, we're able to kinda actually chart our expenses to our revenue, and that was just an absolute game changer.
00:25:25 · Nathan Lindley, Mikk
So ultimately, what we've done is we've played everyone in the entire company with, like, one or two very specific exceptions. Everyone in our entire company now is on is on commission. And so if our CSRs, they get paid for every call that they make, for every appointment that they book. There's there's, you know, like, this whole pay structure built around their their performance. And so that's become, you know, a a key tenant to our to our... How we operate our company. [00:25:52] S0: And then what's next, doc? You started you you started seeing this this model works, and now sometime later, you acquired company number three and four and five, and let's get into... Yes.
00:26:09 · Nathan Lindley
[00:26:09] S1: We took a solid year to just watch it work and just make sure that we weren't dying. Because it got... It has been so bad for so long that the last thing we wanted to do is go in deeper and and the problem wasn't actually fixed. Right? So so what we did is we we started just kind of building Austin back up because we lost all of our technicians, and we kinda... The one guy. So we just kinda started building Austin back up slowly, hiring one or two guys at a time, build Dallas back up slowly, and and putting everyone on performance. And then you're you're having to kinda fix all these little problems that are coming up too. Right? Like, you're you're just kind of fine tuning all the little bits of the process. And so after a a year, year and a half, we're like, okay. Things generally seem to be working. Let's keep going. Let's do the next deal. And so there had been this deal that had come up, like, a year previous, and we'd actually been... We've been looking at it before the wheels had fallen off, and the deal had fallen apart. And so we went back... That that guy actually reached back out to me and said, hey. His business partner had passed away and he owned another company. He couldn't run both companies. Like, kinda need to get out of this. So we were able to get that deal on really good terms. And so that became deal number three where we... That was another Dallas deal. So now we had two deals in Dallas and one in Austin. And and that was when things kinda started accelerating a little bit. So that was deal number three. And the deal number four... It's funny. Actually, both of these deals number three and four were both deals that we had looked at previously, and then they had kinda fallen out. And then they ended up coming back to us, like, a year to two years later saying, hey. We we kinda need to sell. Deal number four was a similar situation where the owner had passed away and was the widow who was trying to kinda keep things going and she was really struggling, so she needed to to be out of it. And so that was another Dallas deal. And so... And and actually, all of these deals were through BizBuySell by the way. Like, all of all of the deals that we had done up to that point were just brokered through BizBuySell, very, you know, retail, you know, nothing nothing proprietary at all. And then How
00:28:29 · Mikk, Nathan Lindley
[00:28:29] S0: was your... I will interrupt here. How was your due diligence? How has it changed? Let's not talk about the last maybe three acquisitions, but [00:28:39] S1: Yeah. Yeah. [00:28:39] S0: Acquisition one, two, three, four, because the first one gave a gave a huge, huge lesson for you.