The Surprisingly Simple Business of Pool Cleaning

So if you've ever thought about wanting to run a pool business, maybe buy a pool route like this one, buy a pool construction company like my friend Xavier. We're gonna go meet with one of our actually Cash flow members who went into Contrarian Cash flow, joined our group and then bought a business, a pool rail business, and turned it into six figures in a year. One of my favorite businesses for college students, people fresh out of college to buy or to build pool cleaning services. Not a lot of money to start it. And I see them all the time, like this one, this one, this one that make hundreds of thousands of dollars a year. And these businesses, you can then sell. The idea here is reoccurring services businesses to nice neighborhoods like this. And you hire people to do the work and you manage the logistics of having subcontractors underneath you. So let's go talk to a guy that did just that, huh? Check it out. Look at this door. Fancy. Oo, You guys. I just had like one of those moments, you know, where you just kind of want to take a pause or a snapshot of it. And one of our Contrarian Cash flow members, which is our group at Contrarian thinking, reached out and said they wanted to meet up the. That they bought a business because of all the stuff that we talk about. I'd never met this human before. We're not in the same state. You know, he knew my name, I didn't know his. And yet the ideas that we're putting out in the world not only allowed somebody to retire from a business by selling it, but also allow somebody else to take that business, grow it, hire a bunch of people and, you know, better their lives. We stole into somebody's backyard. The door was open, to be fair, Brian. So there's that. But we did because I wanted to understand about this pool business, pool cleaning. How could you make a business out of the thing that I hate to do and my husband gets stuck with? And that's why we got. We got two gents who are going to tell us about that today. Well, first of all, who are you? Why would you buy a pool company?

You know, I had a solar company, and so I've actually worked with a lot of pool guys. I sent a lot of referrals to them. And as I started learning more about the business, I was like, this is actually a really good business. You know, there's recurring monthly service. It just kind of fit into what I was doing already. And I just like the business model as well.

How did the structure and deal break Down. Did you buy this business? Did you start this business? How much money did it take and when did it start making you money?

We found it on BizBuySell. It was a guy who, he was retiring. He's had it for like four or five years. And then basically we just reached out to him. I think he was asking like 57,000. It was 78 accounts, which is actually a pretty good deal. Accounts usually go for about 1,000. He was selling them for about 750. So we're like, okay, this isn't bad. So we put an LOI in, put some earnest money down, started doing our due diligence. And then probably like a week before we were about to close, I said, would you be willing to carry it? And he was like, sure, why not? So I was like, okay. So the initial ask was, you know, we'll put down 30 and you carry 27. You know, there was a little bit of negotiation there. And so we ended up doing 35 down and then 22. He carried is like 8% over three years. So that worked out really well for us. He was trying to get out of the business. We inherited his techs and we started. We closed on the business December 1st. And so we've been running it for, man, it's May already. So it's almost like six months now. It's crazy.

Two of my favorite words, seller financing. You can even do them on small deals, which I think is really cool. I mean, this deal is less than 100K, you know, 57, 58K.

Right.

And the seller's willing to carry $35,000 of it because probably there's not a huge market for people that want to buy this business and think they can grow it and do the logistics for it at that small of a scale. And so sometimes you can actually do more sellers financing at the small end than you can at the larger end, where some of the bigger players play. So I think that's really cool. You own a solar business and you thought this business could be additive basically.

Yeah, yeah, exactly. With the solar business, right. We're always looking for ways to help customers save money on electricity usage. Out here in Nevada, the two biggest users of energy are AC and cool pumps. So one of the things we do for them is, hey, you know, let's. Let's make your house more energy efficient. Let's put in a variable speed pump that'll save on your money. We'll do a little bit smaller system, but we build a more efficient house for you. So that's how we did that process with them and that differentiated us from other solar companies would just go out, sell the solar system. We tried to do a little bit more value add for them and they saw a lot of value in that.

The part that I think is cool about this is I like to think of buying businesses like little satellites that go around my main thing. And so it sounds like you have a similar philosophy. So you got your main thing of solar and then you buy these businesses that go around it that you can use some of your same staff, systems, processes. You have efficiencies of scale that you add to the one business by acquiring another one. Now you could just acquire the pool business straight out, but I think a lot of people don't realize that they do this other thing and they could do acquisition alongside of it. So I think that's really cool.

Yeah, we looked at Mailbox one, we looked at a logistics company, but then finally we decided on the pool one and so we found that route. I knew a little bit about SEO and so when I started doing a little bit of research, there was a big opportunity there for us to build a good website and start getting leads organically that way. I knew that he owned a marketing agency and he's also a realtor.

We actually already had a full website up and going because marketing agencies will do a bunch of just random websites to test, to test different things on so you don't screw up stuff with your clients. So we already had a cool website. We've already done all the research around that. And so when he came to me, I was like, how about we partner in this and we'll just do the work. We've done all the work already. We'll build a home new website. We'll actually do close to 60,000 words of content and we'll rank within six months.

So the plan is you grow through SEO and the way that you do that is you spin up a better website because usually all these small businesses have websites.

So the key is doing the research first to make sure that the actual search volume is there on Google for a demon to make sense. So our agency probably turns around 70% of the business that comes to us just because the search volume's not there. And we wouldn't feel right taking their money and not being able to give them a phone call. So you do the research first, you make sure the search volume is there and then once it's there, which it's obviously there in a lot of service based businesses, then you can then it's a formula on how to beat the competition.

So cool.

And you add, I would guess, like better Google reviews, better Yelp reviews.

Yes.

The reviews are obviously. I mean, if you have no reviews and you show up one, two or three, it doesn't matter because usually your competition is going to have reviews. So that's important. You know, the back end of link building and content in general and how much content's out there. Again, it's really a formula when you're competing against other websites is how much content do they have, how much authority do they have? And then it's just a money game of how much money you have to beat them.

So.

All right. One of the keys to small businesses overall is super easy, except nobody does it, which is Yelp, Google reviews and making sure that people can verify small mom and pop that they've never heard of actually could do the job aren't gonna it up. So you run a marketing agency and I imagine know how to do this. How would you go after getting reviews? What are the hacks that you have?

Be very careful about hiring people to do fake reviews. You can burn your account very quickly. In the real estate industry, how we attract reviews is we. When I'm handing them the key, you know, at that time I'm texting them the actual link to the review page. They usually say, yeah, absolutely, I'll do the review. They don't do the review. And then I just send another text just saying, hey, just wanted to make sure the link worked. And the second I send that, they feel bad that they didn't do the review and they write the review almost immediately. So I get about a 90% rate when they do that.

Wow. When you are thinking about how to market this business and how to do it as a realtor using your, like, sphere of influence, how do you do it?

Now?

I've been in real estate since I was 22, so I have a pretty large network. We're one of the top.

What are you, 25 now?

36. I wish I was 25. I have a lot of agents that are doing 100 deals, 120 deals, typically a year. And so those were the first people I reached out to. And for me, the way the real estate industry works is you scratch my back, I scratch yours. And so I've always gone above and beyond for people in my sphere, and they kind of do the same thing back. And so the average agent that does about 100 to 120 deals that I'm friends with will probably get around 30 to 40 leads a year from it.

Besides, you know, getting reviews and testimonials and marketing yourself is. You talked about it. Finding people who can actually do the job. You have this cool system where you're going to increase their. Let's see. Salary as they go. Yeah, but what do you do to find people who are willing to clean pools so that you're not out there doing that every day? I mean, maybe you like to.

Maybe that's.

I don't know.

No, definitely don't like cleaning pools. As far as finding the text. Right. There's a couple ways that we do it. You know, we do through Indeed. That's one way. We're also big on, like, personality tests, So I give our guys, like, personality tests to see if they're gonna be a good fit for that position. We kind of profile them a little bit.

Which one?

Predictive index.

Yeah, anything sexy you do in your. Indeed profiles so that people actually respond to that and want to do it.

You know, honestly, for the tech side. Not. Not really. I believe it was. Nikki had a video where she worked with a guy who does recruiting and building a profile. So I watched that video, and so all of us kind of got together and we built out what the GM looks like and what success looks like. And so we put that together, you know, so when they read the description, it catches them right away. This is the person. And then from there. There, we put them into predictive index, and that's how we find our current general manager. He's awesome. Like, our general manager now is awesome.

Favorite part of the story is that you guys are a member of our premium cash flow group. This is where I went. And the camera zooms in my face. But I love that because that's, like, the whole reason we created this. This business, right, Was to create more business owners. And I think, you know, we know that there's these 2.4 million businesses out there that people don't know how to buy, they don't know how to run. It's really cool to see people taking action based on the ideas that we have and seeing people watch Nikki's videos and the stuff that we do in the cash flow group. We got all the warm and fuzzy. And I don't actually think because we've only run this thing for, like, 10 months, basically. I don't think I've gone out and met people I didn't know before who have taken action. I mean, we have, like, 214 people that have bought a business or started a business based on the Cash Flow Group, which is I think like 1800 people in it. But, but meeting somebody is really cool. So I'm glad I got to come into your house and do this Day to day operations and logistics. You guys run other businesses, you have other stuff going on. Like how do you manage this additional business with everything else you're doing? What are the processes, what are the tools you use to make sure that you can oversee everything's happening as it.

Should be My technical role, I'm like, I'm, you know, you know, I'm CEO. I have my other partner Dominic, who's coo and he directly manages our general manager. And so Dominic is actually in San Diego. So as far as tools, the, the one big thing that we use is I, I've used vas in my solar business. We have one fully dedicated VA who does customer service for our bright pools and she does a lot of the calls invoicing a lot of that stuff. So she handles QuickBooks. But as far as managing the day to day, Ivan is kind of the more hands on guy there taking care of that. And then Dominic manages Ivan remotely from San Diego. I'm not involved too much in day to day.

The key is the gm.

Yes.

The key is killer gm.

Yes.

And then a VA that's. Did you buy, did you get that.

Person on upwork or follow up onlinejobs.

Ph when I put out an ad on onlinejobs ph, you get about 70 to 80. I can just send one email with asking a few questions and that'll knock it down to about 50. Usually we're testing them, so if we're looking for a writer, we're usually giving them a writer's an actual test to see where their skill level's at. For our operations and for whoever talks with our clients, we're usually having them put a video together so that we can see what they sound like, how they present themselves. We use Loom a lot, so we use Loom videos. That's how we update our clients and so we make sure that they present well on Loom.

That is so key. I use Loom in all my videos. Shout out Loom. You can sponsor us. I think it's great. I use Loom for all of our processes. We also have an onboarding test that we do with every single person that I think is so important and we just replicate it every single time. And then we use Notion to track all former people that we've hired previously one way or the other so that we can go back to the talent pool. If one of them doesn't work out for next time. And so we just keep like a big Rolodex of it, which I think is really cool.

Smart.

When you are communicating with all of the individuals, do you use any cool tools like Slack or individual software that you think helps the business run more easily? Besides, obviously QuickBooks.

The biggest thing is Slack. You know, we use Slack definitely between the communication, especially with the va, just because they're, you know, in the Philippines, time difference. So that's crucial. There's a CRM that we use and then what's that called? It's, well, it's called a Go High level, but they white label it to different agencies. So we use that as our CRM. And then we also use a pool management pool route software. It's called Skimmer. It manages all the routes. But the cool thing with that as well is once a tech goes out there, he, you know, changes the chemicals. He'll take a picture, he'll just say, done. And then he'll fire off a report to the homeowner saying, your pool's clean. Here's your chemical levels. We were just there and boom. And so they, they know that we've been out there. So they feel warm and fuzzy.

That's brilliant.

Brilliant.

Do you know what my pool guy wanted to charge us in Austin, Texas? I don't even have a big pool. $300. I did not get a text, I did not get a photo, I did not get a report. So I love this. Anytime you can add tech to these boring businesses, to automate them, to innovate them, and to make the experience 10% better than the other guys, your capture and retention rate is going to be so much higher because the bar is set so incredibly low, then that just that little bit extra is incredibly important.

So I think that's cool, right?

Pools?

Yes. Yes.

Stink. Story time. All right, guys, this is kind of special because I just sold a website for 8k that I bought for about a hundred bucks. It was called Grow Getters, a newsletter that talked about marketing growth. I did it just for fun with two friends. And it made me realize that I wanted to tell more people that you can start with small deals, you could start with large deals, but you can definitely start with online deals. So I partnered with this company, Flippa. Thanks, guys. About where to buy online businesses. It's my favorite site to buy any sort of online business, period, full stop. That's why I'm trying to invest in them. So maybe you guys can check this out. So That I could get part of this series. That'd be awesome. Thanks, Blake CEO. Because after all, we know that 94% of startups fail. That's why I like to buy them instead of build them. And this is true on Flippa too. For online businesses, you can get loans or use seller financing. Although you gotta put down some cash. You can have profits on day one of owning the business. You can use the cash flow of the business to fund your next brilliant idea. But instead of paying for an idea, you buy it first. So here's the link. Go check them out. There's 500,000 businesses that have been listed on Flippa. They've done billions of dollars in transactions.

Cody, you're forgetting that Flippa is also the best place to sell an online business. They even have a matching algorithm to.

Get your business in front of the.

People most likely to buy. So anyone out there looking to sell or even just find out what their business is worth, check out Flippa's free valuation tool here. Anyway, back to you on stage, Cody.

Was there anything interesting that you guys did when you were negotiating with the pool salesperson? Like, how long did it take you from thinking about buying a business to actually closing the deal? And did you do anything cool in that period?

I wish we could say we did something cool, but it was pretty straightforward. We came across it on Biz Buy, Sell, you know, talked to the broker, and then he put us in direct contact. It was pretty straightforward. Did our due diligence, tax returns, bank statements, Nothing surprising came up. He gave us like two weeks for due diligence and then close at the end of the month. I didn't plan on doing owner financing, but then I just watched some of your stuff. I'm like, why didn't I just ask? Ask, what's the problem with asking? And, you know, I said, you know, we're willing to pay this up front, and I just push, push it a little bit. You know, if you go through brokers, right, they'll give you like a refund period. If account cancels, they'll replace that one. Since I was buying it with him, there was no guarantee there. So I said, you know, we're paying this up front. There's a lot of risk for us. If some of your customers leave, would you be willing to carry half it? He was like, okay, I'll do it. So I love it.

Always, always, always ask every time. You were already a businessman. We didn't, we didn't teach you everything for sure, but you kind of started learning about this opportunity of buying businesses from contrarian thinking. Is that right?

Exactly.

All right, so tell them how rad it is. What do you want to tell them?

So I would say, I mean, definitely just the, the group. Right. They're awesome. There's a ton of helpful resources there. And just the, you know, just the group calling to, to, you know, bounce ideas off of it's has been a great investment for us. So if you're on the fence about it, you guys should definitely check it out.

I didn't even like minded people too. Tell them about it.

Yeah, it's all like minded people that are all wanting to start businesses and so everybody just wants to help each other out and it's not this scarcity mindset.

Yeah. Yeah.

Surprisingly rare.

Yes. Yeah.

Very rare. I think there's something that happens when you're in a group of other people that are all moving towards ownership acquisition, making big moves.

Yeah.

It doesn't become weird anymore. And it's just like, oh, why wouldn't I buy that business?

Yeah. I've had guys from Phoenix and Texas reach out to me. I had a guy that owns one in Georgia. I talked to him, we're all, you know, sharing best practices and talking about, they're like, hey, you should do this. You should do this. Other guys looking to acquire. I'm like, yeah, you guys should look this. And there's, there's a community there. There's no competition. And it's like, if we can help you guys. Awesome.

I love that. Anything else you think people should know? Sign up. I love it. There we go. Once a salesman, always a salesman. Thanks, guys.

Thank you.