[00:00:02] Speaker A: Welcome to Intentional growth, a show that teaches you as a business owner and entrepreneur to view and run your company like a financial asset, which will allow you to enjoy work, create wealth and make an impact. This mindset will help you focus on building a more valuable business and give you the choices to grow, acquire, reinvest, or exit. Live the life you plan for all with intention.
And now, here's your host, Ryan Tansom.
[00:00:32] Speaker B: Welcome back. Thanks everybody for tuning in. I am very excited for today's guest. If you are a fan of this show, I would be unbelievably grateful if you went on to your podcast player, gave the show a review. We're constantly trying to level up our guests, level up the content, and share this episode with anybody that you know that is in the trades, that's looking to grow a business. We've accumulated a large following in the trade space as well as onboarded quite a few companies in the home services over the last couple years, which is why I'm very excited to have Tom Reaver on the show. He's a performance coach, HGTV host, and the founder of the contract Fight, which is a global organization that's transformed the lives and businesses of hundreds of thousands of home improvement contractors worldwide and over eleven years of experience in his industry. Tom is an absolute blast to have a conversation with. We dove into his mission, which is to really level up and redefine the perception of trades. His whole goal is to help people in the trades stop stealing from their family through time and money and level up their own perception of themselves, perception of the trades and grow a valuable company. And some of the other things that Tom is going to be talking about today is some personal developments in trades. Things that he's been seeing over the years as the trades have become a lot more scarce for labor and a lot of big money has been running after the trades. So there's a lot of cool things that we talk about there. We talk about the importance of financial literacy and business acumen. And Tom's got some great examples of some people that have transformed their lives and companies over putting a lot of work into themselves and what it's like to combat negative stereotypes from an entire industry and a bunch of people that actually are providing some of the most valuable work these days. And he's got a bunch of personal experiences that he shares about how he struggled through his own career and how he essentially landed on all these epiphanies and became a coach through his own experience, which I value a lot because he's not just saying it, because he read it somewhere. He has done it, and he's helping people do it. So thanks, everybody, for tuning in, and I really hope you enjoy this conversation with Tom.
[00:02:37] Speaker A: This episode is brought to you by Arcona's fractional CFO services. Arcona's fractional cfos integrate into your management team and assume the responsibility of the CFO. They become your strategic financial partner to help you run the business, create your value growth plan, and build the financial roadmap to the valuation you want to achieve.
[00:03:00] Speaker B: Tom, how are you, man?
[00:03:01] Speaker C: I'm doing good, Ryan, what's going on?
[00:03:03] Speaker B: This is not your first rodeo, so I think this is going to be a lot of fun.
[00:03:07] Speaker C: Like my second or third? I think so. Something like that. No, man, I'm looking forward to. It's good to hang out here.
[00:03:13] Speaker B: So I was trying to think about how to get this started, Tom, and I think what's fascinating is the mission that you're on. Let's just start with the mission, because I resonate with the mission from some of my background, but then a lot of our clients and actually the people that have listening onto this show, I think there's probably a cross reference or some people that are on both. But I think why don't you just give everybody a little bit of a cliff note of what's the passion and the mission that you're on.
[00:03:40] Speaker C: Yeah. So to get to the point as quickly as possible, we're creating a world where the trades are no longer a fallback option and viewed that way. And we do that, if you want to call it our methodology.
We help you develop or demolish mediocrity in yourself at home and then in your business, in that order. And so the contractor fight was born out of a desire to just help contractors bring respect and dignity back to the trades. I love it. I grew up in a family of contractors, and none of them really made any money. They were always tired, dirty, broke.
All the white collar kids were going on vacations, and we never went anywhere.
I spent most of my life trying to not go into the trades, and I ended up there. And I'm glad I did because it's full of amazing men and women that are adding huge value.
We're really passionate about. We talk a lot about money. Like, if you're not getting paid, why are you doing this? Right?
Yeah. And I don't care if you have a hot dog stand or if you're a house painter, if you're going to start a business, run a business, get paid and there's so much. The contractor fight. The fight is between your ears. That's why we call it.
[00:05:01] Speaker B: I love that. I actually wrote that down. It's so funny, tom, because my dad always said, you got to manage the six inches between your ears. And you actually said that in your video. I was like, I freaking love it, man. Because it's the hardest fight. You can't just lock yourself in a closet and get away from it.
[00:05:15] Speaker C: You're stuck, right? And we all grow up with a certain amount of head trash and mental baggage that we carry around. And I don't care who you are. You got it. Negative self talk, whatever you want to call it. And I'm 54, and I've grown up in a world where the trades were always made out to be, like, a fallback option and not, like, a first choice for most. I don't ever remember anyone in my school.
Teachers, counselors, anything. Not that they were poo pooing it in any way, but they never encouraged kids to go into the.
[00:05:56] Speaker B: You know.
[00:05:56] Speaker C: And then they get rid of shop class and all the crap they've done over the past few years across America.
[00:06:03] Speaker B: Amen.
Tom. What I want to dig into is, and I don't know if there's special kind of serendipity of the right word or karma or whatever it is, because I'll kind of just lay out why I'm so fascinating about this topic is because I mentioned a little bit of my story, and we had similar kind of mentality in our old space. But what I find so fascinating now, tom, is all of the big money is going after your industry.
I got people that. I'll tell you this. And then the irony is just hilarious. I got people I know that I graduated college with that went in, got their marketing, communication analyst, whatever degree, and one of these guys went to college with. He's like, yeah, this HVaC guy moves into our neighborhood. It has a better house than me and pays all cash for $90,000 pool, and he's freaking broke.
I'm sitting here going like, it's literally 180. And now we think about AI and all the crap that's going on, and there's a huge wave. And I see you helping pioneer that wave, and I see the narrative needing and needing to change, not only for the people, so people can go make some money again, but also bringing respect to it.
What was it like?
I just think about your generation growing up with that kind of mindset and just all that. What does that do to your head? Trash because I know what you said is yourself, is it your family and then the business and why you have to start with yourself. And I can only imagine why. What was that like?
[00:07:41] Speaker C: Listen, there were some guys that have grown up in the trades, and they've always felt like it was the greatest thing in the world, and they didn't have the same worldview I did. Right. So I don't mean to make this like this was everyone's experience, but I nuances.
I think part of the, had I grown up in a family where if my dad made a shit ton of money in the trades, I mean, he was a tile guy and a bunch of other stuff through the years, and we were always broke, so had I grown up in a family where he actually knew what he was doing to run a business and make money. I probably have a very different view on know, because one of his best friends grew one of the biggest plumbing companies in Illinois at the time. So it was just two very different experiences, but a lot of commonality, don't you think?
[00:08:29] Speaker B: I know, I respect you for trying not to generalize, but here's kind of the bell curve of like, hey, there are the anomalies over the years that have grown big companies, but generally there's a lot of contractors that are struggling consistently.
[00:08:42] Speaker C: Yeah, a lot are struggling because they think because they can build a cool thing or paint something nice, fix something or whatever, that they can start a business. And they certainly can start a business. But the minute you start a business, you got to take off the craftsman hat. It doesn't mean craftsmanship is not important. Of course it's important. Right. But your number one hat that you have to wear at this point as a business owner, and your number one job as a business owner is to meet needs and get paid.
And so 90% of the contractors that we've worked with through the years don't know their numbers. They have no idea what their overhead is. They don't know what break even revenue even means.
I'll have 100 contractors a room. I go, everybody.
I pick somebody. What's your monthly overhead? And they're like, I think it's 20 grand. I go, okay, what's your break? Even revenue a month. And they're like, 20 grand. I'm like, wrong. Okay.
And it's not because they're stupid. It's because we're ignorant. Because we haven't put the reps in to educate ourselves like we have in the trade. They'll know everything about a freaking saw blade and educate themselves on tools and this and that. But when it comes to the numbers of your business and how to communicate your marketing and how to communicate better in your sales process, leadership, all these different things that end up becoming overwhelming because they just don't start from day one as a business owner putting their focus on that stuff. And sadly, we get guys that have been in business for 810 years, and they don't have anything to show for it except a bunch of debt, and they're making crappy income.
I have a just personal opinion. There's no science or anything behind this. It's just an opinion. But if you've been a home improvement contractor for five years or more and you're not putting 250 grand in your pocket a year, then you should probably consider going to get a job, because it is easy to make money in the trades if you just get some.
[00:10:41] Speaker B: Of the fundamentals, especially now with the demand out there.
[00:10:44] Speaker C: Yeah, well, the demand is. I mean, dude, if you answer your phone, I know you sell the follow.
[00:10:52] Speaker B: Up and do what you say you're going to do. And what's fascinating, Tom, and interesting data points, man, that I want to share with you is, so I spent 44 days this year doing keynote speaking gigs for places like vistage and trade associations. And I have a big exposure to a lot of different types of industries. We started to do a lot of work in your industries or the home services. But what's fascinating to me, Tom, is you could take what you just extrapolated in the home services into, like, my dad was a copier sales guy. I told you we had 21 million in revenue and we lost a million bucks. Like, yay, revenue. Who gives a shit?
[00:11:29] Speaker C: It doesn't matter.
[00:11:30] Speaker B: And what I find so fascinating is the middle market entrepreneur is usually a craftsperson, kind of like what you said, and it's like the e myth of Michael Gerber. But what I find fascinating, though, is that other industries, there's more acceptance of, like, hey, you're a business owner, you were a scientist first, you're a copy salesperson. But there's this weird narrative around home services. But even as I was growing up, and I'm 37, so I'm a decade and a half younger than you or so. But the problem was that narrative made this gap in this chasm of, like, we need people in the trades, for God's sakes.
[00:12:09] Speaker C: Well, listen, we've done ourself when I say we, that tradespeople, we've not done ourselves any favors.
Let's start with that. If anyone's listened to the contractor fight any of our content over the years, you'll know that I'm very quick to ask you to own your crap, right? Like, look in the mirror and go, where have I screwed this up? In my own business, my own life, my own relationship. The extreme ownership stuff, right? Yeah, I love it. And the trades in general are a very easy, there's a low barrier to entry.
Again, you don't have to put in years of discipline and studying and stuff like you do for some other occupations, right? Doesn't make the trades any less important, those other occupations.
So, number one, it's easier to get in. Number two, we haven't done ourselves any favors by being a bunch of knuckleheads. Like I said, answer your phone.
Don't park in somebody's driveway when you pull up for your appointment with them. Actually get up on time and move your body and don't be a fat ass.
[00:13:25] Speaker B: The oxygen first.
[00:13:27] Speaker C: Yeah, get oxygen, right? You got to get oxygen.
Take a shower and brush your teeth before you get in your work truck and go meet people. The number of contractors I see out in the world that have bedhead just start with that. It's like, this is the brand you guys are putting out there, right? And so it's all these just self respect things. And that's why we talk about demolishing mediocrity in you first. And, I mean, I don't know how many guys in the trades that I've known through the years, and I was one of them for a while, where all in the name of growing the business, you stop going to the gym. All in the name of providing your family, all you do is work and you blow off date nights. And you might be, yeah, I was present for all of my kids games and stuff, but you know what I was doing? I was over on my phone texting customers. I was that dad walking around on the phone at the game and trying to see what's going on. I wasn't all in, all the time. So I just think all these things combined don't do us any favors for when other people look at the trades and go, I want that. And then you add the money component onto it where most guys in the trades are broke, there's too many stories in the news about contractors ripping people off. And I just think that's why we're on the warpath here, man. In the fight to change you the individual, to be somebody who's, and I don't mean like a bodybuilder or David Goggins, put together, somebody that's just, hey, I take care of my body, I take care of my mind. I have a strong home life. I have a great marriage, all right? And I got a fat wallet. Like, make yourself attractive. If you want to solve the labor issue and the trades, the current contractors need to be attractive to other people so that you look at that. Because everyone now, all the young kids, now I want to be an influencer, social media influencer and stuff. And it's like, good luck with that.
[00:15:27] Speaker B: Here's a glimmer of hope, Tom.
I'm tracking everything you're saying. So I got a younger brother who's 30, and I think there's him. And below, there's this mindset that's starting to change. And my wife and I were interviewing this babysitter, so I got daughters that are seven right now.
And I was talking to this gal, she's a senior in high school, and she said, 50%. And it's a big school. Are going into apprenticeships and services. I was like, holy shit. Isn't that crazy? So there's some momentum going, man, which I think is awesome. But I think it's fascinating because I got the opposite upbringing where it was like, polish your shoes, wear a suit, even though you're broke and no one needs you.
It was the whole fake it till you make it crap. But there's the overcompensation of the vanity crap.
[00:16:19] Speaker C: You know what I mean?
[00:16:20] Speaker B: So everything you're just talking about is so important. And I think, honestly, man, there's some stuff out there about the men crisis. And I want to get too much into that. But we need to have people that have got their crap together, and there's a really good money to be made.
[00:16:36] Speaker C: Listen, some of the stuff that I'm talking about here, it's all designed to help you build your own confidence, right? First and fore, get oxygen. I am never going to be as strong for my family or my business or my customers or anything unless I take care of me first. And a lot of us, with good intentions, we flip it and put everything else first. And so when you start honoring the commitment you make to yourself each day, to go to the gym, to eat right, to be on time for appointment, whatever it is, every time you honor a commitment to yourself, your confidence increases, all right? And you become more attractive, more magnet. People want to be around confident people, right? I don't know about you, but last thing I want to do is go hang with somebody who's got low self esteem, all right? Because it's just like a wet off the bridge. Yeah, exactly. Come on. And so I think a lot of contractors, because they don't take care of themselves first.
That carries over. How you do one thing is how you do everything, right? So if you're not confident in who you are, you're not confident in your relationships at home, that success is an inside out game. You're not going to be confident when it comes time to raise your prices, to spit out what you think is a high price to a prospect. And then now you're selling from desperation.
[00:17:54] Speaker B: Which everybody immediately, it's a doom loop that goes in itself fulfilling. So I found it awesome how vulnerable you are on your website and your story.
I think that honestly Tom, people can only get this convicted about this topic if they've seen the you. Why don't you explain to the audience how you got to this point where you know that this is the truth.
[00:18:23] Speaker C: Well, I burned a lot of my own life to the know. Listen, we were building a great painting company outside of Chicago, was doing millions of dollars a year revenue wise and even profit wise for some of our years. We were in the top 5% to 7% of companies in our industry, right? And doing great things. I had a great business partner and I mean, shit, we were doing, I don't know, 300 jobs a year or some crap like that. We were humping machine and we were doing it with a pretty small team. And I think what happened is kind of a combination of everything we talked about.
I thought it was all about building the business. I thought that's how you took care of your family.
That was my first marriage. So it's like I wasn't always what I needed to be at home. I always put the business first because money makes the world go around and life's easier when you make money, right? But what's funny is the more I put the business first, it was almost like the less I had made because I was just always on and I never had any mental bandwidth, I wasn't taking care of myself, I was obsessed and I lacked confidence. All the things that we talk about.
Then there's a perfect storm of just some certain situations in life and business and some family things that just combined all at the, like I said, a perfect storm and I ended up filing bankruptcy. So here I was building this business and it was a personal thing, it wasn't a business thing and it was just a mess. We had a lot going on that I won't go into that are personal issues and health things and whatever but when I look back, I look back at how I approached business and my health and time and family, and it's just a lot of hard lessons were learned. And on the tail end of that business, we were doing really good. We were coming through the recession in nine or whatever that was, and we kept our whole team together. We were actually more profitable during the recession. And some would say we were kind of hitting our stride and really about to go next level with things. And I woke up one day and I said, I'm done. I sold my half of the business to my partner because it was just more important for me to have an impact in some of the lessons that I learned in life. And I've always been a coach at heart. I coached high school football for 17 years.
I love helping people achieve their next level of success.
That's just where I wanted to spend my time. And I think that's another lesson I've learned, is there's no gun to your head that you have to grow a business, that you have to grow a business and do it for the rest of your life.
I think you got to define what success and happiness means to you and don't waste any time pursuing that.
[00:21:22] Speaker B: Amen, man.
I've been through various situations, like you're talking about, and my question is what I've always struggled with.
You know, that the shit is going to eventually.
I'll speak from my own experience. I know when I'm going through something miserable now that there's going to be a good outcome if I process it correctly. Yeah, but you're just like, damn it, this is really not fun.
And it's this weird. Trying to think of the analogy. I snowboard, and it's counterintuitive. Over, like, with snowboarding, when I learned how to snowboard, if you lean into the hill, it's actually easier, which is the opposite of what the hell you think, right? Because you think you're. You're, like, going to look back, you're leaning back, you're trying to go slower, but if you lean into the hill and go faster, it's way easier. And that's why I think these experiences. What about the experiences that you went through where it's almost like a trust fall, where it's like you're learning what you're going through, but then you have to lean into something that you know is not known or it's the unknown. Are you tracking what I'm saying here? I'm trying to think of how to put words to it.
[00:22:35] Speaker C: Yeah, I totally leaned into the unknown. People thought I was nuts when I left my company. I mean, a lot of people thought I was off my rocker. Like you spent almost think at the time, we were eight years into it and it was humming along. And in business, you got to be in the game long enough to win.
Very few businesses do. You open a business and a year later you're on top of the world. Right?
We were just, I think, figuring some things out, but people thought I was crazy, but I had such a passion, like it just this voice, this feeling just going, hey, this is great. You've proven you can do this. You could continue to do this, but are you really fulfilled? Do you really feel like you're living your purpose? And that little voice, that little nudge just kept saying, hey, let's step into the unknown a little bit. And, man, the first couple of years I was just kind of hanging out, just like, I don't know what I'm going to do. And probably two, three years of mean, dude, I drove from, you know, the Midwest. I drove from just outside of Chicago, Naperville area, all the way to Eau Claire, Wisconsin.
[00:23:53] Speaker B: Close to me, man, you almost made it to.
[00:23:55] Speaker C: That's right. So check this out.
To do a speaking gig, I had to spend the night and then drive back. So round trip, it was probably like thousand, about 12 hours, something like, because it's like 4 hours to wasa and then another couple of hours, right? So anyway, it was spent the night, paid for a hotel. I charged $500 to go speak at the thing, man. And I'll tell you, I wish I could remember the organization.
I suppose if I really wanted to find out, I could find out, but this had to be like 2012 or 13. I had no clarity of my message.
They invited me to come, man. I've been there and there was like 150 people in this room and I bombed, man. They were gracious, they clapped and stuff, but I've had so many of those gigs. But that's my point is I was leaning in. I didn't know. They asked me to speak on some stuff, and so I came up and I spoke, but like I said, I just didn't have the reps, I didn't have the confidence, I didn't have the stories.
I think I was trying to be something I wasn't. I don't know if you've ever done that as a speaker where you try to.
That's why I made a decision that I'm just going to be real.
Take me. Leave me. In fact, I don't get invited.
[00:25:22] Speaker B: When you start, it's terrifying.
[00:25:23] Speaker C: Yeah. I mean, listen, we put on our own big events every year.
I've spoken the last decade at a lot of different places, and private workshops and businesses know shit. Had a show on HGTV as a host for a minute. All right, so I'm no stranger to be in front of crowds and cameras. And I'll tell you what, what's funny is because I made a commitment to just be myself. There's a lot of things I don't get invited to do, which is because I don't really have a filter, and I'm just going to be me. And I think we live in a world of people that are just trying to impress each other instead of tell each other the truth.
[00:26:04] Speaker B: What were some of the things that you were afraid to lean into? Because I think this is, by the way, why I think this is so relevant, Tom, is because I think all the listeners that are business owners or contractors, whether it's raising prices or knowing that you don't know shit about your numbers, it's all this unknown where we have to just. I don't know, man. People are just figuring it out every day.
[00:26:26] Speaker C: Yeah, I think first and foremost, and we could talk for days on this, and we won't, but just for time's sake.
The number one lesson I learned is that I'm not stupid.
And the reason I say that is I grew up and I rode the short buses and was in special ed for two, okay? In grade school, I hated school. The only reason I ever did I stayed in school was to play football. And then I joined the Marine Corps. And long story short, for decades, I carried this anchor on my shoulders that I was stupid. And so what that would do in relationships, my business partnership, who, I said, a great partner, but I sabotaged a lot of that stuff because I didn't trust myself, because I thought it was stupid, so I wouldn't share my opinion. And then when I did, it was an explosion of emotion because I'd been stuffing it for so long. Right.
[00:27:20] Speaker B: I'm laughing because you've done it.
[00:27:22] Speaker C: Right.
[00:27:22] Speaker B: I was like, shit is Tom. And watching me.
Oh, crap, man.
[00:27:27] Speaker C: And so that's the biggest lesson is. The biggest lesson is, I think, number one, I came to realize I wasn't stupid. Number two, I wasn't confident because I wasn't disciplined enough with just little things, right?
And I think when you lack confidence, a lot of bad shit happens. You make stupid decisions. I had a lot of money, mindset issues from growing up that I didn't deal with, which prevented me from raising prices, believing that you could raise prices, believing that you could. That's even possible.
I could go on for days of the lessons learned. But I think when I look back, I didn't want to talk about the fact that I went bankrupt.
There was a lot of people that were like, I was probably one of the last guys they thought that would have gone bankrupt.
And then it was funny is, right after my bankruptcy, I'm talking like, two months after it was finalized, the president of our local bank called me up where our business had its, and I'd sold my half of the business at this point, and all this garbage. Maybe six months later, whatever, it doesn't matter. President of the bank calls me up, invites me to be on their board of directors, and I'm like, you know, I just had a bankruptcy, right? And I tell you what that did. His name's Ken. Great guy.
He gave me a little bit of confidence when I didn't have know, and I'm not sure he quite knows what he did, but just the fact that he invited me and I was on that board for a couple of years, and then I got to see behind the scenes of so many different businesses because we'd have to review certain loans, not all of them, but there were certain things we had to get exposure.
[00:29:19] Speaker B: To what everybody else got exposure.
[00:29:21] Speaker C: And I'll tell you what, man. The contractors were making all the fucking money, and the doctors were all in debt, and the doctors were all broke. I'm telling you, it was crazy.
[00:29:31] Speaker B: I'm sorry. I'm laughing because Tom, and God bless my dad, and I know he'd laugh at this story now, but he pulled it in a freaking jaguar. I'm sorry, not a jaguar. A Maserati. Tom, into our parking lot, and all of our freaking payables are at 90 days. And I'm like, what the hell, man?
[00:29:50] Speaker C: Yeah.
[00:29:53] Speaker B: Pardon the brief interruption. I hope you're enjoying this conversation with Tom. This is for anybody that is in the home services space that wants to view and run their company like a financial asset and get visibility into the future so they can get the visibility, so they can go do what they love the best. And the reason I bring this up is because my team at Arcona, we've onboarded a lot of people in the home services space over the last couple of years. We've been integrating our financial dashboard with service titan so people can see their operational data, their financial data, and forecast all that into the future. So you can make good decisions about actually how to build a business, how to hire people, resource planning, how to forecast out your distributions, your valuation, and making sure that you're getting where you want to go to make it all worth it. So that way you can, as Tom keeps saying, quit stealing from your life and from your family so you can get more time back, make more money, and have more fun. So that way you can get rewarded for all the hard work and sacrifice you've done over the years. All you have to do is schedule a discovery call with me and my team. My, my team does offer a complimentary financial assessment. If there's a good fit, you can just use the link in the show notes below. Thanks, everybody, for tuning in, and I hope you enjoyed the rest of the interview with Tom.
[00:30:59] Speaker C: So, that built my confidence. And then I think there were so many good people in my life that would just. I mean, I don't mean to paint this picture like that was some big loser. I made some shitty decisions financially, put myself in a crap situation, and I learned a lot of lessons from it. Right.
And quite honestly, I don't really trust a mentor or a coach if they haven't been kicked in the teeth. So I think I bring a lot of value to people because of the failures. I wish I had nothing but golden spoon stories.
[00:31:35] Speaker B: Okay. I want to challenge it. Do you? Actually, no.
[00:31:37] Speaker C: I don't really believe that.
[00:31:41] Speaker B: This is my question, tom.
I don't know if it's possible to have a good outlook on life without this. And I'm curious if you think so, because I have eaten glass way too many times, and 90% of them have.
[00:31:57] Speaker C: Been self inflicted for a lot of.
[00:31:58] Speaker B: The reasons you just.
[00:31:59] Speaker C: And that's a key point. That's a key point. So when I say I wish I had these golden spoon stories instead of the throat punch stories, it's because when I look back, 90% of the, if you want to call bad shit that happened friendly fire. It was my own mindset, my own lack of communicating honestly with a business partner or with a client or whatever it might be. All that other stuff. I look back now with 2020 vision, and I go, I had control over every one of these situations, and I chose not to be in control. I chose to be a victim. So that's why I say I wish I would make, however, every single experience I've had and that you've had makes us who we are. And I wouldn't trade that. Even the things I did that weren't ideal in my family excuse me. Years ago, just not being present and stuff, they've taught me a lesson. And this time around, with my wife, I'm like, super husband, super engaged. We have five kids between us, and nothing comes between my wife and I.
I don't think I would have this had I not had those other experiences.
[00:33:16] Speaker B: Are you familiar with the book conversations with God? No, I've heard of it, but it's not uber religious.
Here's my takeaway on this, Tom, and I just want to experience here because it was instrumental in my processing of this kind of stuff, is if the goal of life is to have our, like, that's the goal is to live our journey. It's to be and to go through our experiences. And if love and fear are like, the kind of the two main things, if you're 100% in love, you need relativity and you need fear. My point about this is then the entire point of life is to get closer towards the love category.
So every experience we have is relativity, so we can go, don't like that. Like that. Don't like that.
[00:34:08] Speaker C: Like that.
[00:34:09] Speaker B: And that's the point. And so then we can wake up and go, holy crap, I was an idiot, and I shouldn't do that again. But without those experiences and the relativity, we don't know who we want to be. So without all of that crap, then, therefore, we wouldn't get to where we are. So it's almost like this false choice where we can't have the. Just the silver spin. I totally agree that you weren't saying that. But what I think is so fascinating about the opportunity and the fight and the mission that you're on is with the shit that the contractors and home services space has gone through. The opportunity to show up in a way that is changing for their lives, for their family's lives, and for their customers and the people that need them in a way that's not arrogant or it's like the ability to do it the way that you're doing to, hey, like, I can be confident, but not egotistical. I don't know, man. I just think that there's a huge.
[00:35:04] Speaker C: You know, you wouldn't believe the amount of pushback I get on our YouTube channel and podcast when I get on there and I start talking about, contractors need to charge what they're worth, charge your prices, 50% gross profit minimum. All this other stuff. And it's the contractors that reply going, fu. Man, you got to be fair to your customers. And if you charge those rates, you'll never get any work and this and that. And it's like, I'll tell you what. If we could get over the collective bullshit head trash of the contracting industry, it'd be a much different world, and people would be flocking to the trades. I tell you, because of the example that contractors would be setting.
[00:35:39] Speaker B: What is the reason behind that?
[00:35:40] Speaker C: You think you're afraid of things that you're not prepared for?
Think about something that.
All right, I'll give you an example. When I was in the Marine Corps, I was an infantry marine, and we were trained to do certain things, right?
Because of the training, when you're in the thing, I don't want to say you're not scared and stuff, but there's a confidence, right? When I was running a painting business after I was out of the Marine Corps, we had to paint 150 dorm rooms in, like, three days. And it was crazy, man. The schedule. And I'm laying in bed, and my heart is pounding out of my chest, and I'm terrified because I hadn't trained for that, if that makes sense. So I just think contractors are their own worst enemy because they haven't put the time in to develop their skills and communication and numbers and marketing and those different things. And so they're afraid of it. So their fists go up and they go, you can't charge that in my area, or you don't know my customers. They're a bunch of cheapskates. All that bullshit that we can all say about any industry if we choose to.
It's funny. Like most other industries, like real estate, financial planning, this, and even the attorneys and stuff, dude, are big into coaching and mentoring. The contracting industry as a whole.
Most contractors have no idea what it means to be coached or mentored. Now, in the last few years, in the last few years, there's momentum. Everyone and their brother is a contractor coach now, right?
Which is fine, but it's just funny. Like, our sales team, one of the biggest questions they get when these guys get on the call with our sales team is like, well, how does this work? How does coaching work, and what do I have to do? And a lot of them think, like, oh, you sign up, and then there's an easy button, and just by osmosis, your life's going to get better.
And my wife, she'll tell you, she's like, you want to know what the golden ticket is? You get your ass up in the morning and you do the shit that you need to do to be successful. That's your golden ticket, right? Totally.
I think the contracting industry is lagging behind in a few areas, but those who embrace this stuff, those who own their crap, those who understand that implementation of the things you're learning is key, they win at big levels. I mean, do we have people come in, one dude doing 300 grand a year, top line as a general contractor, lost eleven grand and maybe paid himself like ten or 1214 grand for the year. I mean, that's the snapshot. Within twelve months, he was doing 2.7 million at a 50% profit and paying himself a half a million. He was home by 04:00 every night.
[00:38:31] Speaker B: That shows you the demand is out there. It's so crazy.
[00:38:35] Speaker C: But what he did is he looked in the mirror and he stopped caring about what the going rate was. He controlled the things that he could control. He worked on himself, his home life, then the business, all the things that we've been talking about, and non negotiably planted his flag and said, I don't care if I'm a GC and it can't be done in my industry, I'm going to get a 50% gross profit on all the work that I do, or I'm not doing the job. And he made those commitments which enabled him to offer better value and service to his clients because he had the money, he didn't have to run to the next job. Rob Peter to pay Paul. And every year, his business grows almost doubles every year since then, because of the order that you're doing things, a lot of guys are trying to do things with their business, which is like, here's the one. I want to scale my business. We hear that a lot.
I hate the word scale, right? And I'm like, all right, well, before we scale, let's make sure that you have consistent sales and that your consistent sales are consistently profitable. As high profit as you can get with what you're doing. Before we go to scale the business, because what a lot of guys do, they think they're going to scale themselves to profitability and they end up just scaling a turd.
You have a little pile of shit here in your business, and then you go, I'm going to add more crews or another location. So it just gives me a bigger pile of shit. Okay.
[00:40:07] Speaker B: I think about what's fascinating and the confidence that people should have. Tom, is what's worse than eleven grand a year and working 70 hours a week, right?
It's only upside. So you go say, hey, no, I'm going to do one job for $30,000 at 50% margin for the whole next year.
[00:40:28] Speaker C: And you're better off. You're better off.
But this is just the education part. And I'll tell you the number one thing I think that gets people, gets contractors to wake up about this is we have them start job costing their current projects. Like, hey, the jobs that you just finished, go back to an after action report, right? I bid it for this. This is what we did it for. This is how long it took. This is what we made. And when you just start looking at the game tape, it wakes you up in a hurry. And I think that's one of. Somebody asked me, do you do that.
[00:41:01] Speaker B: In the painting business, too? When you said it was, you charged, what was it, 24, 28 grand? And it was twice as much or something like that. The cost?
[00:41:08] Speaker C: Yeah. My first year of business, I sold a $28,000 job. It was going to carry me through the winter. I thought I was going to be rich. It was this guy, GC, in his own house. So the place was empty. I could just go in and work.
I charged 28. It cost me 45 grand to do the job, which meant, based on our rules that we teach and coach, I should have charged about 100 grand for the job. Okay? And so I shortchanged myself because he was a moron. And I'm not blaming him. It was all my fault. But the guy was also a moron. GC'in, his own project. Find out he was a colorblind lawyer, and so he could never pick colors. It was a mess.
This project took me a year to finalize, and he hemmed and hawed about, like, another five or ten grand of upcharge, which wasn't even enough. So that's why I say total friendly fire, right?
But that job ended up being a master class for me. That has now enabled me better than an MBA, right, to not only build what I'm doing, but also to help a lot of other people avoid mistakes and make them. I mean, we've helped people generate over a billion dollars through our programs in the last few years, man. So cool.
We're very vulnerable group.
I couldn't be prouder of our fight team and all of our coaches and our admin team.
[00:42:35] Speaker B: Where's the momentum going now? Because like I said, I mentioned about those high schoolers and how many people are looking at the trades or apprenticeships. What, do you see this in five years?
[00:42:46] Speaker C: Yeah. So we've seen a big uptick in people actually going into the trades. And I think there's a couple of reasons. A lot of guys get laid off because their current business owner doesn't know how to run a business, so they get laid off or the economy, whatever people want to blame. And so they go off and they start their own thing. And because they do that, they are now googling things and going on YouTube and finding our content. And so we've seen a huge uptick in our self guided courses, like know your numbers and how to sell and stuff. For three, four, $500, you can get these courses that we do. So we're seeing a lot more of demand for that come in.
Believe it or not, I'm seeing, from the consumer side, a desire for contractors to just step the hell up, honor the commitments they make. And I don't mean like, I mean, there's always been that segment of people, but I think the mediocrity is so common in the trades that your average client is just going, God, just answer.
[00:43:50] Speaker B: Your phone or just call me back, pay you more.
[00:43:53] Speaker C: I just want my problem solved. And they're dying to be understood is really the general consensus here. And when you can make somebody feel understood, especially in your sales process and your marketing, things like that, it's game over. So I see there's technology and AI and all this other stuff, but I'm seeing a. And maybe I'm seeing it because we're pushing it on our end, but I'm all for innovation and technology, but I think we've lost the human touch.
[00:44:24] Speaker B: I don't even know. I think about the AI that's coming after white collar jobs. Tom, we're a long way away from someone getting on a ladder to do some gutters or to do a roof or to go all the way downstairs, go through your HVAC system. And I think that there's a huge opportunity, though, because of that and because of the needs there and the threat is not there.
[00:44:50] Speaker C: Yeah, certainly the actual work part of things is going to be a while right before robots are doing that. But I just think there's so much automation.
And I don't mean this to be like I'm ripping on younger generations. I'm not trying to be the old codger right now, but people forgotten how to talk to another person.
[00:45:13] Speaker B: Right.
[00:45:14] Speaker C: Everything's text. And we got five kids ranging from 18 to, what, 23. You ask any one of them to like, hey, call that place and see if they have a table available. And they're like, I don't want to call table Tom. Yeah.
And so we're intentionally working really hard, not throwing out innovation and technology and automation, but you got to have that balance in your business of like, yeah, I want automations for efficiency and things like that. But if you're missing out on human connection, I think you're really hurting your business. And so I think that's career and.
[00:45:56] Speaker B: Your business and everything.
[00:45:58] Speaker C: If you can't look another person in the eyes and ask good questions and have a conversation and not get flustered if you feel like they ask you a question, say no.
[00:46:06] Speaker B: I mean, I think about it. The listeners probably get sick of me. But I grew up cold calling, man. I went to the biggest building in Minneapolis and I was like, I don't know. I'm going to get the shit kicked out of me. I might as well go there. But it's so crazy rare.
But also, here's what a question I have for you is that given that I agree with you, robots aren't coming for these jobs. There's a lot of automation on the back end, but the services is just that. It's people and it's customer service, doing whatever home service you are. And I've watched the flood of big money come after these industries because there's a lot of really good cash flow in these companies that are doing pretty.
Got this. I got the same comment. I could say for every industry. It's like if I go on my Twitter feed and say, let's take x amount of money and roll up blank. Industry, digital marketing services, ask company. And then it's all coming after the home and services. And I have this clip I should send you where it's all these cars. And there's this one car, it says 55 year old HVAC business owner. And then it's all these cars that is like Deloitte ey private equity going, hey, by the way, because they got.
[00:47:17] Speaker C: Fired from their jobs and all that stuff.
[00:47:21] Speaker B: You can't just do a spreadsheet model 45 degrees up of like, hey, by the way, all we do is roll up plumbing, HVAC, home services, all these home services, because it's a people business. That's also where I came from. And I'm sitting here going, I don't see this. I mean, I see the opportunity, but it's not being thought through of the lens of customer service people, and it's apprenticeship and culture. And you can't see that in the spreadsheet unless you do it naturally. And so what is your exposure? I mean, are you seeing the same kind of shit?
[00:47:57] Speaker C: Yeah, I'll give you two sides. Business owner and then employee. The number of business owners that will ask me in dms or whatever it is. Hey, I know you talk about you have to get out there and meet people and do prospecting. I'm a painter and I want to get more GC work. What do I say to them?
Just annoys me. I'm like, are you that unresourceful? Like, seriously? You know, I'm sorry, did Google not stroke you off and give you the answer in five?
Maybe say just that? Hey, I'll be like, I don't know. If your nads were on fire and you had to connect with a GC to get them extinguished, how quickly do you think you'd come up with something to.
Here. Here's my prospecting line. I've used my whole life, everything I've ever done. It's a variation of this. Okay.
Hey, Joe, I see you build custom homes. I happen to paint houses. I thought we might need to know each other. That's it. Dude, I drive around Colorado Springs here. I see a contractor in a store wearing a shirt, and I'm like, hey, I see that you do remodeling. I run this thing called the contractor fight. I thought we might need to know each other. And we have a conversation. Guys, don't overcomplicate this. And I see that more with like, the younger people. They don't know how to talk to people and it drives me crazy. Now, on the employee side, people, owners, it's the owner's fault, by the way, are not, because they don't charge enough, because they're not choosing to be a student of their business and the numbers and marketing and sales and leadership. They end up doing no professional and personal development for their people because they can't afford to and they don't know how to, and all the other whatever excuses. And therefore, people don't stay with them and continue to grow and have an actual career.
[00:50:06] Speaker B: It all starts with their mind and then their family, and then the pricing, and then they can't afford the right pay and the right benefits and the right professional development. It just ripple effect all the way.
[00:50:14] Speaker C: There are a lot of good people in the trades that are not going to stay in the trades because the owners are a bunch of knuckleheads, because they're not doing their part to make the money and invest in their people. And so they look at this and go, why would I give? And there are a lot of people, a really good character, that like to build stuff, that want to be in the service business, whatever. And they look at the company they're with and they go, if I give my time and my talent and my sweat to this company. What am I going to have to show for it in ten years? Nothing. And that's on the owner.
So I'm tired of owners going, oh, nobody wants to work hard. Nobody wants coming to trade. Well, you know what? Be the type of company somebody wants to work.
[00:50:58] Speaker B: It's like, I'll give you an example of this conversation. Tom can't escape me. It was like four years ago, this guy, they had a property management business and a home remodeling and a remodeling business, right? Because they were doing all the work for all their properties. And we're sitting this conversation, and this guy, he's like, call. He's 50, and he's like, because we're talking about valuation, value, growth, so he can get what he wants, right? So that's where we're coming in with our training and our education, and he's having this conversation. We're talking about his 800 to a million dollars in normalized EBITDA, the cash flow. And we're like, okay, so you're doing a million dollars, roughly. And then he does that whole thing. He starts bitching about all of his employees. No one shows up. Babel work. And I said, let's call him Bob. Said, bob, what are you paying these people? Yeah, $18 an hour, no benefits. And I'm like, yeah, would you show.
[00:51:53] Speaker C: Up for that either?
[00:51:57] Speaker B: Hey, man, maybe you can increase your valuation.
The insanity of that conversation has just stuck inside my head going, come on, man, there's got to be some investment in your people. And again, raise your prices, pay your people more, increase the benefits. There's good cash flow in the business.
[00:52:17] Speaker C: You have to be able to communicate to your team what's in it for them if they stick with you. Right? So it's not enough just to put your vision out there, and some would say create a vision so big that everyone else is $20 million.
I don't care what your vision is. Point is, I'm going to care more about your vision and giving myself to it if I know what's really in it for me, too, because every human being wants to know what's in it for them. And I think that's one of the biggest things. I'm glad you brought this up. I'm thinking of one of my good friends and former business partner, only former because he retired. Who? All the guys in his company, all his foreman. And he had a small water feature company. It was massively profitable, and he sold it for a few million bucks, by the way. But anyway, all his foreman made 100 grand a year, and they ended up buying the company.
[00:53:17] Speaker B: I talked to my buddy.
I think they have six or seven people on their deck install. They install decks. They're all making a buck 20, right? And they're just like, that's awesome, man.
[00:53:33] Speaker C: Their hourly was 100, and then they did upsells and got commissions and did some sales and whatever it was. The point is, if you don't create an environment where people in our world, we have this phrase. It's hashtag fw, stands for f and winner. Okay? And that's our version of an a player. I hate the term a player because it's just too soft and corporate for me. Right. We call them Fws. And if you want a winner to be attracted to your company and stay with your company, they have to see that they have opportunity to keep winning if they're with you. Right. And it's not a dead end. It's not that complicated. I don't know why so many people can't figure this out, that if for no other the reason, raise your damn prices and invest in your company so you could build a team. And I don't know, man, but it's.
[00:54:24] Speaker B: Between the six inches between the head.
[00:54:25] Speaker C: Yeah. And I think a lot of employees get thrown under the bus. I was talking to a guy the other day, one of our programs, amazing guy, amazing salesman, doing great revenue. We kind of dug into his business, and he's just having issues with profitability, meaning jobs not finishing on time, too many callbacks, some of those typical things. And I'm listening, and I'm listening, and this and that. And he was not, like, throwing his team under the bus at all, because I asked him, I'm saying, well, what do you think the cause of this is? And we're on a zoom, and he kind of looks down, and he goes, it's me. It's just me. And I go, all right, well, what are you going to do about it? We don't need to beat you up. You've owned your crap. Now. Let's just fix this shit, right? And I'm like, well, what did you do wrong? What will you do differently going into the new year and this and that? And he was like, I just made too many assumptions that they could read my mind. I was focused on this.
[00:55:21] Speaker B: That's a good ownership right there.
[00:55:22] Speaker C: Yeah, it was. And he's been in our world for a long time, has his act together. Love the guy. But more owners need to do that instead of bitching at your team. Now, listen, he had some team members he had to get rid of and some guys that are on the bubble and things like that. But for the most part, he's like, we're not hitting jobs on time. We got some issues with callbacks and this and that. It's not all on them. I got to own my crap and do my part, too. And I'm a very big, I guess words, proponent of not firing people until I know I have done everything possible.
[00:55:57] Speaker B: Amen to that, Tom.
[00:55:58] Speaker C: To set them up for success, because I've burned through a lot of good people because I didn't do that in the past. And now I look back with perfect 2020 vision, and I go, man, he was a really good dude, and I blew that. I messed that up and so forth.
[00:56:14] Speaker B: What I love about this whole, I just call it this massive, massive opportunity, Tom is, dude. I think about the other industries that we work and, like, AI is the biggest threat, or, like, margin compression or inflation or whatever the hell it. And, like, where, like, you have the typical mindset of people that are business owners. That's already all the same stuff we're talking about and all that stuff. But what I love about this is the biggest leverage point is the mindset, because the demand is there, the need is there, the profitability is there.
I can't think of other industries where it's like, hey, man, the future opportunity is pretty damn bright.
It's just that bright. And it's just inside your head and your confidence.
[00:57:05] Speaker C: It's not just bright, but it can happen quickly because of the chunks of money you're dealing with. I mean, like, paint a house, it's 1012 grand. You do a kitchen, it's 60, 70 grand.
These are not like many years ago, I coached a personal training person, and I coached a massage therapist. It was funny. Other people I've coached and the amount of things that that massage therapist has to do to make money.
[00:57:35] Speaker B: Right?
[00:57:35] Speaker C: You know what I'm saying? Because they were operating these little chunks of money, these little slivers of money, where a contractor, that's why the guy from 300 to 2.7 was such a.
[00:57:47] Speaker B: It's totally possible.
[00:57:48] Speaker C: Fast thing. Because, shit, if your average job is 20 grand and we can even just raise your gross profit 10% right out of the gate on your average job, is another two grand in your pocket right there. Like that. It's a mortgage payment, right? Depending on where you're not having to.
[00:58:04] Speaker B: Bring on, by the way.
[00:58:05] Speaker C: Right.
[00:58:06] Speaker B: You're bringing on $200,000 AI specialists or coders or whatever the hell it is.
Yeah. I just love it, man. I think the opportunity is enormous, man. Is there anything that I haven't asked you that we haven't covered?
[00:58:20] Speaker C: One of the things that we try to pound into people's heads is, listen, we're talking trades here and stuff, but I don't care what business. If you're going to own a business, make sure you're not stealing from your family. Time, money, and memories. Right? We talk about that a lot in the fight. Stop stealing from your family. And you steal when you don't charge enough. You steal when you don't work on sales role plays. You don't learn how to market your business. You don't learn how to be a better leader. You don't honor commitments to be home for dinner. You don't go to the gym. And I know I'm throwing a lot at people here, but it's that inside out game. Success is an inside out game. And if you just trust and attack that process and plant your flag there, you're going to win it no matter what you're doing, man.
[00:59:02] Speaker B: I love it. Tom, if people want to follow you, the show, your books, all that kind.
[00:59:07] Speaker C: Of stuff, well, we have the winning the contractor fight. They can get for free. Just pay, shipping and handling. You can get all
[email protected]. And I think I got to look here, man. You surprised me. I wasn't ready. Sorry.
[00:59:26] Speaker B: I know you got your podcast, you got your book, you got your events, all that stuff.
[00:59:29] Speaker C: Yeah. All that's out there, man. And I think there's a tool I want to give you guys. It's thecontractorfight.com. Fwday. Yeah, fwday. And what that is, guys, it's just a pdf. But I'll tell you what.
Listen, I've talked about the inside out game and this and that.
To gain momentum.
We want to make sure that we're stacking the small wins each day. Right. Just win the moments. Right. You don't have to eat the elephant one bite at a time. So the FW day is broken into three areas. There's two personal activities that we ask you to do a day. There's one pipeline activity, and there's one profit activity. All right? And anyone could do it. Like, I'll give you an example. The personal activities are. Check this out. This first one's really hard, man. Put your eyes on your goals today. That's it. Because what you focus on improves what you focus on, you get more of. And a lot of us focus on our problems and our circumstances and all the shit that's going wrong in the business. That's why I start every day. I got a little thing on my phone, and I got a notebook that I write a few things down. And then I spend 510 minutes a morning just going, hey, we're buying the land that we want to build our compound on. That's a goal. I'm doing this with this. I'm doing this with this. And I just take five minutes, a couple of minutes, put my eyes on my goal. The second thing is work out. I don't care what the workout is. Just work out. Like, seriously, just looked at your goals and worked out, moved your body every day.
And then there's a pipeline activity where basically we call it unexpected intentional touches. A uit and send one uit to a past client every day text. It's individual. Okay. It's, you know, literally as simple as, hey, Ryan, it's Tom. We painted the first floor of your house last spring. Just wanted to check in, see how it's looking. Send.
[01:01:23] Speaker B: How much of that just equals more business, man.
[01:01:27] Speaker C: We have a guy who, and I'm just asking people here on the FWA, just do it once a day. One of the dudes, GC in Milwaukee that we work with, dude, in addition to his other marketing and everything else, he did this one task that he did for a year, put over a million bucks of revenue in his company. Because what happens, we found about 5% of these turn into a sales conversation for sure. Okay. Hey, we were just thinking about you, or, hey, it's my neighbor, or whatever it is. Hey, it's looking great. Thanks for checking in. And that's the end of it, right? Whatever. You're not selling it. You're genuinely just going, I give a crap about you. How's it looking? And then the third activity, we call it profit activity. One thing today, protect your profit. We give some examples on there. You could do job costing on a project to see how you did, right. You could do. Maybe you have to have a tough conversation with a client and that's going to protect your profit down the line or with an employee. Or we have a sales roleplay thing that we do every day. It's called the agogi, inside of our battleground coaching group. And every day, five days a week, weekdays, we have live sales training, roleplay. So jump on there and learn how to sell. Do something to protect your profit. Love it. That's the FW day and it's all mapped out on a download if they go to thecontractorfight.com fwday Tom, this has been awesome man.
[01:02:56] Speaker B: I am full support of the fight you're on. I appreciate it so much. Thanks for coming on the show. This is like literally the opportunity is amazing, man.
[01:03:03] Speaker C: I appreciate you having me man. It was great chatting. You're very easy to talk to. These are always the fun ones, man. Thank you. Got it.
[01:03:12] Speaker B: Thanks for listening into that conversation. I hope you found the time valuable. If you enjoyed the conversation, please leave the show a review on your podcast player. We're constantly trying to up those reviews. It helps a lot with the visibility and if you didn't catch the commercial in the middle of that episode, there's two different ways that we can help you. One is if you want that kind of clarity. We have a coaching program that is based on the five intention growth principles and uses the material to help you get that kind of clarity on your target equity valuation and income that you need on the way towards that valuation. What you want from the business long term and why and then how to get aligned with your leadership and your partners. So that way everybody's working in the right direction to get you what you want. And the second way is if you want to jump right into the data and you want to actually build out your financial roadmap with your three statements and tie your financials and your operational data to that target equity valuation, my team offers a complimentary financial assessment. Either way, all you have to do is go use the link in the show notes below, schedule a discovery call with me. We can walk through your situation, figure out if there's a fit or not, and if not, I can point you in the right direction. Thanks everybody for tuning in and I hope you enjoyed this episode and I will see you next weekend.
