Why Daikin Bet Big on R-32 (And What It Means for Your Business)

Welcome to The Successful Contractor powered by CertainPath, a show for residential contractors about residential contractors. We chronicle business journeys, share insights, and celebrate successes in this wonderful industry. I'm your host, Bob Houchin. For more information on how CertainPath can put your contracting company on a certain path to success, visit our website, www.mycertainpath.com. I hope you enjoy today's show. and take away a nugget or two.

But you come to North America and somehow chemistry changes when you come across the ocean. I can blow an air conditioner up to 20 stories tall. I can take a class inside of there and we can walk around and point out different components. I can take everybody into the ductwork and say, okay, let's talk about airflow and air distribution. And it's, you know, it's Honey, I Shrunk the Kids or The Magic School Bus, however you want to look at it. The 15-year loan is still Starting to surpass the 0% interest. What does that tell you? We are in this era of perma-uncertainty, which I think is a great opportunity for everybody to really just push the envelope.

Ben, thank you so much for being here today. Greatly appreciate it. For those who've not had the pleasure of meeting you, could you share with everyone your name, your company, and what you do for them?

Hi, my name is Ben Middleton. I'm the National Sales Training Manager for the Goodman, Amana, and Daikin brands, and super excited to be here. I've been with Daikin now for about 9 years.

9 years.

And have just—

Doesn't feel like it, right?

No, it doesn't. Time has been flying, and I am having just such a blast because I think we are at a really cool time in the training, learning and development world and space. Because just like so many other aspects of society, There's a lot of technological changes. There's a lot of ways that people are changing. And so it's just been a wild ride and it's been a lot of fun.

Yeah. And actually, I mean, Daikin's been on the forefront of a lot of the refrigerant and innovation, and that's why I wanted to talk to you and we'll see what other trouble we can get into while we're at it.

All right.

But before getting into that, I always love sharing people's personal stories. I just think there's so much to be learned from it. And so I'd like to dig into yours. You've been in the industry for a while now, right? So how'd you first get in the trades?

Well, it is an interesting story. So I started out, I was going to school for aeronautical engineering.

Wow, that's an obvious leap into HVAC.

And well, airflow, aerodynamics, it all works together. But I actually needed to figure out a way to pay for flight time.

Okay.

And there was a local heating and air conditioning contractor that said, hey, we're looking to grow this indoor air quality department. Would you like to come in and help us take this indoor air quality department to the next level?

Yeah.

And so I said, why not?

Yeah.

And so I started doing that and started selling a bunch of furnaces and air conditioners with duct cleaning.

Okay.

And they said, well, we want you on residential replacement sales. And we actually were bought at that time by a large consolidator that was consolidating a bunch of companies together. And that consolidator asked if I would start doing some training, sales training.

Yeah.

And so I worked with them and just got the privilege to travel all over North America doing classes. And there's a ton of stories I could tell you there, but that really is where I kind of unlocked my passion.

Sure.

Is I really enjoy just watching those sparks, those light bulbs go off.

Yeah.

Having somebody come up to you after a year or 2, or even now, sometimes I have people 15 years later come up to me and say, hey, you know, we did this and it completely changed the course or direction of our business. And thank you. And that's—

And their lives.

So rewarding.

Yeah.

I think about the awesome responsibility that all of us have.

Yeah.

Because not only are you changing the lives of the business owner, but the people that work for the business owner, the families that are involved with that business. I mean, there is a huge ripple effect in everything that we do. Yeah. And that's why I do what I do, because I just love seeing those moments and those ahas and those ideas and being a part of somebody else's journey.

It's so cool. That's why, I mean, I've been doing this for not nearly, not quite as long as you have, but 20-something-plus years. And people go, how do you stay at the same place? I go, when you see the impact, not just the businesses but the personal lives, and then you know how it's changing the lives of their employees, I go, I mean, it's a pretty cool industry, you know. It's a fun place to be. What kind of training are you doing nowadays?

So I'm in charge of all of our sales and business development training, and so we're working with all of our contractors to help them with those block and tackle business basics to run a business. One of the things I found out in industry is you have a lot of really good people. Again, I don't think there's a better industry to be in because just of how much this industry gives back to their communities and everything else they do.

Right.

But you have a lot of great people that are craftsmen. They're true experts at what they do. They're the best installers, the best service people, even the, the best comfort advisors, and they're great problem solvers.

Yeah.

But the problem is nobody ever sat down with them and said, here's how you put together a business plan.

Right.

Here's how you do this or how you do that. And so I feel, and you know, just like you guys do, that there is a, a need to give contractors, you know, that baseline. And so we spend time Working with contractors and helping them understand their basic financials and then helping them to be able to get to a certain point.

Yeah.

What's great working with groups like yours is I feel like we get them to a point where now they can kind of step off, we can hand them over and say, hey, this contractor's ready to really take their business to the next level and use the systems and the tools that you guys have developed to help contractors excel.

Yeah, no, it's fun. It's fun to see that transformation.

It is.

Now, I know you also do a little bit of this too, right? So you started your own YouTube channel and podcast. Can you share everyone the name and what you guys, what kind of content you put out?

What led us to attend the event today, we've been watching the CertainPath podcast on YouTube for quite some time, and it just had a lot of good content. So we wanted to come and see what that content was live. Coming into this, I had no expectations of what it might be. I've never experienced anything like this before. But it proved to be a truly moving and engaging experience all the way around. My most powerful insight from this is that there are other contractors just like me, just struggling to make it, to figure it out. And it's wonderful to know that there's a network of people that can help support you and have your back. The most exciting thing to take home here, what we're going to implement, is going to be the call-taking and dispatching for profit. I can truly see from the coaches what the value of that is, and for us, that's going to be step one. I would recommend others come and experience so that they can find out what they don't know, to understand that they don't know what they don't know, and to be able to experience a community that's willing to help answer that question.

We've been doing a lot of research, and I find that the biggest barrier to training and education today is It's just time and scheduling availability that people have. And so we're trying to always figure out what is the right delivery mechanism to get in front of people. And so we started Accelerated HVAC Success actually during COVID Okay.

Yeah, that's when we launched, right? Because you feel like we all were like, what are we going to do?

What do we do?

Yeah, yeah, yeah, yeah.

And it wasn't really a podcast format when it first started. What it was was more informational. We had some fun. We went to a huge warbird museum in the Houston area and we kind of related HVAC business principles to flight. I mean, taking 2 of my passions.

I was gonna say, there you go.

And tying those together. And that was the catalyst for getting going. And then being in Houston the next year, we actually did a NASA theme. We actually went to Rice University and filmed where Kennedy gave his speech speech that we choose to go to the moon.

Yeah.

And, uh, and really had fun with that theme and, and tying about, you know, what do you choose as a contractor? Where are you going? What is the vision that you're going to set? Because Kennedy set an unbelievable vision for this country and he accomplished it.

Yeah.

And, uh, and I think that's so important with an HVAC contractor. We're not just doing this, but you need to have some sort of a vision behind where do you choose to go with your business.

Yeah, yeah.

And then, and then we kind of settled into this podcast format just because we saw that bringing in different vendors, bringing in different people, and really doing this. And now, I mean, we've done podcasts on top of Pikes Peak.

Yeah.

We've gone to the Garden of the Gods, we've gone to the beach, we've gone to Dyckman Park. So we've had a lot of fun doing all this. That's very cool.

So what kind of content can people expect when they, when they visit your channel?

It's a wide variety. So we have a lot of our third-party vendors that we have come in that help contractors excel with their businesses. And so a lot of those sales enablement tools that we work with, we also have contractors come in just sharing their stories and what they're doing in their business. Then we have our product managers come in, talk about current product we have, and then of course, you know, what's coming up and future product that we have available.

Sure.

So we just have a lot of wide variety of topics. We have regulatory people come in, talk about what's going on with government regulations. You never know. You know, it is very interesting because every time you turn on the channel, we're not really quite sure what we're going to hear. Right.

I bet.

I bet. Especially in this industry. It's like, holy moly. Yeah, they like to keep tinkering with everything.

Yes.

Actually, that's a good pivot. I wanted to talk a little refrigerant. It's always still a hot topic. Still, I know a lot of your competitors went with 454B. You guys chose to do R-32. Why did you guys decide to go that avenue?

So, well, Daikin was the first to make a decision.

Yeah.

And actually, we approached all of our other competitors in this marketplace and we said, hey, look, we really do believe R-32 is the right way to go. And I'll get into that in a second, why we chose that. But we released all of our compressor patent technology Because we said, hey, we'll even give you the compressor technology that we have because we truly do believe R-32 is the best way to go. And so there's a couple of reasons. One of the reasons is R-32 is a single component.

Right.

So it brings us back to R-22. It's not a blend.

Right.

It's just easier for a technician to work with in the field. You don't have to worry about putting jugs upside down. You don't have to worry about it leaking it on unequal rates. And so a single component is a lot easier. You don't have to worry about superheat and subcool.

Right.

Because you don't have the, the 2 different components in there. So that, that was one reason. Another reason was with the— so a lot of people, I'll dispel some of the rumors that are out there, have said, well, Daikin went with R-32 because they invented it. Well, no, Daikin never invented R-32. It was invented back in the '60s. And they actually used it to etch out chips. And so that's where that component was first introduced.

Yeah.

And what Daikin did is they realized that it had some really favorable characteristics to air conditioning. So in 2012, Daikin actually optimized some compressor technology around it to get the full benefits. And so what R-32 allows us to do is we can use less refrigerant in a unit.

Yeah.

And because it has better heat transfer ability, and that does a couple of things for us. One, we can have smaller units. And that's a big deal for contractors. Big units nowadays, for sure. Is we're able to have a much smaller footprint using R-32. We use about 30% less refrigerant in our units compared to contractors. or manufacturers that decided to go with 454B.

Yeah.

So when you look at just the impact on the environment, you can't just say, okay, 'cause yes, R-32 has a higher GWP than 454B. Well, that's great, but if you're using 30% more of 454B, that kind of nullifies that argument that you have.

Right.

The other kind of interesting fact is 70% of 454B is R-32.

Hmm, that's interesting.

And then you have 1234yf is the other component. That's 30%. So all you're doing is adding 30%, 1234yf, to the unit or to R-32. So both units have the same amount of R-32 in them.

Interesting.

So you're just adding another component in there, which adds for more complexity. Yes, it gives you on paper I guess you can say I have a lower GWP, but really in essence that's a wash. But we get better energy efficiency because, because of the better heat transfer, we're actually able to slow the speed of the compressor down.

Yeah.

That draws less amperage, using less electricity, and so that actually helps quite a bit as well. And so when you take all of those benefits, and there's a lot more, if somebody wants to really get into it, they can go to R32reasons.com. Oh, okay. I like it. And if you go into R32reasons.com, it'll get into a lot of the reasons. There's some white papers for engineers that are out there that really want to get into the nuts and bolts of everything. But, and also R32 is proven. So it's been out since 2012, and we know that we haven't had any issues on the rest of the globe. And, you know, the thing that I really scratch my head with is if you Google some of the other manufacturers and just put Europe and then you put R-32 in there, on those websites, for whatever reason in Europe, R-32 is the best thing in the whole entire world.

Is that right?

But you come to North America and somehow chemistry changes when you come across the ocean. And I haven't figured that out quite yet, but that is interesting. It must have something to do with metric and the— Empirical system, but— That's wild.

So how's the market responded then when you guys made this decision then and now versus now?

So we actually were very early to bring R-32 to the market. As soon as building codes were in place and the first state to allow an A2L to be put in was Florida.

Okay.

So we came out with our Atmosfera unit in late 2019, really started selling it in 2020.

Yeah.

So, I mean, we're looking at 5 years ago, we started to put R-32 units into the market. And really consumers, there hasn't been much pushback or issue at all.

Right. I mean, probably just lack of knowledge, honestly, right?

At the end of the day, consumers trust what their contractors tell them.

Right.

And so we had no issues with those ductless units going in. The nice thing with the ductless units, they were less than 4 pounds of charge. So we didn't have to worry about any of the remediation. Or those sensors that we have to put in with the ducted units where we have more than 4 pounds of charge inside of them.

Right.

So when we went to the unitary and we started rolling that out, really it's been— a lot of contractors have noticed the performance has gotten a lot better. So if you remember, like contractors that are doing long line set applications, when we went from 22 to 410A, All of a sudden, the line sets got a lot shorter. And so that made it difficult to be able to do a lot of those multifamily projects and things that other contractors were doing.

Right.

With R-32, now we have longer line sets again. And so it gives us the ability to be able to do that. We can use smaller line sets.

Right.

So contractors that are changing the line sets out on every single job, like we did up, you know, back, over 25 years ago when I was in Racine, Wisconsin, we changed line sets on every job that we did.

Yeah.

As long as we could get to 'em.

Right.

I can use smaller line sets with R-32. And so those are easier to work with, less cost that I have.

Yeah.

And we're also seeing, you know, R-32 is a commodity.

Right.

There is no patent on it. And so that makes it, you know, very competitively priced, right? Whereas 454B is a proprietary blend, and so there we see price disparages between the two. And so using more of a refrigerant that costs more brings more cost to the homeowner. And when we look at today, I mean, homeowners have been squeezed, right? When you look at the producer price index that has been put out there, we have seen that the cost of goods especially in the HVAC market, has skyrocketed over the last couple of years. Every contractor's aware of that. The consumer's wages have not matched that speed of those price increases. So the big buzz in the industry today is affordability.

Absolutely.

How do I make my systems affordable? And obviously financing—

I was gonna say.

Is a key to it.

Right.

And making sure, but I was just talking to one of the financing companies that we work with work with, and they were telling us it used to be the number one loan was a 0% interest loan.

Yeah.

They just saw a shift this year.

Is that right?

To a 15-year loan.

Interesting. I mean, we always preach offer both, right, and let the consumer decide.

But now the bank is telling us that, you know, the 15-year loan is starting to surpass the 0% interest. What does that tell you? People are looking for a low payment.

Yeah, absolutely.

Consumers are stretched. They're trying to figure out how do I fit this into my budget? And so I think it's so critical, every little bit. I can use a smaller line set, I can use less refrigerant, I can, you know, have a smaller footprint on the unit. All of these things really, that's why we believe R-32 really is the right way to go.

Have you guys noticed increased demand now? 'Cause people like see all those contractors see those benefits and they're like, I just rather go with Daikin and then deal with all this other stuff.

Yeah, we are actually seeing a huge surge right now in purchases where I'm hearing from some of the other manufacturers that they're saying that, hey, they're seeing their sales down year over year. And so we really do see that increased demand, and we see a lot of, you know, excitement around going back to a single component, making Making the industry easier for everyone.

Right, right. That's good for everybody.

Yeah.

I want to talk, shift topics a little bit. You know, you guys, your leadership's great about the topic of information sharing, right? Very open book. Why is that transparency such a big deal for you guys?

Well, yeah, I think part of it goes back to Daikin's core values. So if you look at Daikin's core values, absolute credibility is one of our top core values that Daikin has and prides itself on. And if you're not transparent, how do you build credibility?

Right.

And so we really do try to make sure that, you know, everything that we can tell our customers, tell our partners that we work with, you know, all of the relationships that we have.

Yeah.

Here's what's going on and here's what we're trying to do. I don't think it's a secret. Daikin really also believes that inverterizing North America is the right way, right thing to do.

Yeah.

That's why we came out with our FIT, our Amana S, and our Goodman SD. It was a product that was meant to be competitive with the 15.2 SEER product that is out there. And many contractors, we're seeing this big shift to 15.2. Used to be base efficiency, but when we look at our overall mix of sales, we're really starting to see this uptick. And when you have an inverter product, I think again, when we talk about we're in this era of perma-uncertainty.

Right.

Like I mentioned earlier, every time you turn on the news, I have no idea what's gonna happen with tariffs, with geopolitical situations, with supply chain issues that may be out there. I mean, there's so many things that are going on right now that are out there. And so when you're in this situation stage of perma-uncertainty, one thing that that does for you— so we've had major instances of this in the past. Right after the Great Depression was an era of perma-uncertainty where you had a lot of change, but a lot of innovation happens at that time.

Right.

Same thing right after World War II. A lot of people didn't know, but you think about that time period right after World War II, there was a lot of prosperity and a lot of great things, innovation that happened. One of the things that happened is you had this thing called television. Nobody really quite knew what to do with it. And if— just think if you went back to that time and you said everybody's gonna have one of these picture boxes inside of their home.

Right.

And people are, no, there's no way people are gonna spend money to have one of those picture boxes in their home. Now everybody has 4 or 5 in their home.

Yeah, and they're cheaper and cheaper now.

But Procter& Gamble, they jumped in and they started this thing called the soap opera. That actually propelled them to the behemoth of a corporation they are because they innovated and they did something different.

Yeah.

We think about the early 2000s. You hadn't heard of things like Airbnb. Zoom wasn't a thing.

Sure.

And you see, you know, how much that technology has been used. Innovators always get rewarded for kind of thinking outside the box. Everybody's heard the Netflix story. You know, they went to Blockbuster and said, hey, you should do this. And Blockbuster said, no, people love, you know, coming in here and finding out we don't have the movie available.

That's how I remember it. Yeah. Like, what am I going to settle for tonight?

So, yeah. So you think about that and all of this innovation. What are contractors going to do now in terms of innovation? And I really do believe the contractors that are the early adopters with inverter technology and go in and say, hey, I can give you a single-stage or a two-stage unit, or I could give you an inverter unit.

Mm-hmm.

You know, that is going to actually really help you with your comfort, give you even temperatures. It's gonna help to dehumidify the space. It's gonna save you a ton of money on your energy bills. I don't think, I think the days of the cube-style unit are numbered. So I would much rather be the one kind of blazing that trail and innovating and being known for that, right, rather than the person holding on to the old cube-style technology.

Hey, sorry to interrupt. Bob here. Quick question: would you like a slice of the $10 million CertainPath helps contractors put back into their pockets every year? I talk to contractors all the time. Customers are spending less. Margins are shrinking. So how do you protect your profits?

You buy better.

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You mentioned earlier that R32— what was the name of the website?

r32reasons.com.

I like that.

I like that.

So you guys are, I know, very good about sharing information and resources and tools. What else do you have available for contractors to let them know what you guys are doing, how you're innovating, how to help them in their processes?

Oh, we have so many different resources. This is the embarrassing fact, and we're trying to correct and fix this right now. But again, I'll be transparent. I think our digital team went out and looked and we had something like, it was something ridiculous, like 60 different websites. We had 40 different apps. We had—

Is that right?

You know, all of these different landing pages and, you know, it's just overwhelming for a consumer or even a contractor. Okay, which website am I supposed to go to for that information? And so we're really working right now to kind of consolidate and make it easier for people to find information. But I guess the big things that I would say is we have the HVAC Learning Campus. So when people are looking for information on training, we have a whole library of on-demand training courses.

Beautiful.

We've been playing— we've been doing simulation-based trainings, which we can talk about in a little bit. We've got our live classroom trainings that we do either at local distributorships throughout our whole entire footprint in North America, but then also we've got live classes that are going on at the factory that contractors can fly into. We've got some amazing labs that contractors can come and participate at, and so we're continuing to do that, but one great thing that we did this last year was we took all of our— we had 3 different training platforms.

Yeah.

We merged them all into the HVAC Learning campus. So we have one place to go. And that's part of this massive consolidation effort that we're trying to do. If we can make 3 websites go into one, that makes life a lot easier.

Absolutely.

And then PartnerLink is what a lot of people know as far as where they can get all the advertising assets and everything that we have available. And so we're working on consolidating some stuff there. And then like I said, the r32reasons.com is another great place to go. So we're We're going to continue to work. We've got some great consumer tools that are available. We're really excited. We just came out with the Daikin Energy Rebate Center.

Okay.

So I don't know if you knew this or not, but there are over 2,000 different utility rebate programs across North America.

That's stunning. 2,000.

So we interviewed—

Very easy to keep track of.

Yeah. We interviewed a whole bunch of contractors in the state of Washington. I think there's Oh my goodness. Utility rebate programs.

Goodness.

So imagine being an HVAC contractor. Now I go into a customer's home, I'm in this zip code, which rebates do they qualify for? And so that's why so many contractors have just given up and said, I'm not even going to talk about rebates.

Right, right.

Even though, like we said, affordability is the big issue.

Right.

And these rebates really help with affordability. There's some pretty lucrative ones out there.

Yeah.

And so what we've done is we've created a tool where a contractor can go in when they're with the customer, put in the homeowner's address, and it will show them all of the programs that are available. So we know the IRA is going away.

Yeah.

And, you know, the biggest thing I'm telling every contractor today is take advantage of it. I'm looking at the electric vehicle market right now and it is exploding because consumers know that that rebate is going to be taken away and everybody wants to take advantage of it.

Sure.

You know, it's always baffled me when I think back to the $1,500 tax credit that they did for 95% efficient furnaces. That drove a ton of sales. It drove a ton of business. Right now you've got $2,000 back for a heat pump.

Right.

I would be doing everything to educate every customer in my marketplace that's saying, hey, the $2,000 rebate is going away. If you've been thinking about replacing your system, give us a call, let us come out and let us at least give you an estimate.

Yeah.

If we've given you a quote already, hey, I just want to let you know that that $2,000 rebate is going away. It may be— it's a great opportunity to just reengage that customer that wasn't quite ready to pull the trigger. If you couple that with financing, now maybe you can do some, you know, some low-cost terms like we're seeing is really good. Maybe it's a 0% interest for a certain amount of time that they need before they get their tax refund or a bonus or whatever it may be that they've got coming in.

Yeah.

But I would be calling—

That's a good sales nugget.

Every homeowner right now and leveraging that.

Absolutely.

Because we're seeing the electric vehicle market has benefited. Why shouldn't the HVAC market?

Totally agree.

But the rebate center, we believe next year, the contractors that go into a home say, here's all the rebates that are available. And here's what the rebate center does for the contractor. Not only does it say, here's all the rebates that are available, but you put the homeowner's information in, Pre-populate and fill out all of the forms and file on behalf of the homeowner by the contractor.

That is nice.

So now, and they have a dashboard so the contractor can see when this one has been paid for the homeowner, when this one has been paid, when this one has been paid.

Very cool.

Or, hey, you didn't fill out this paperwork right. We need this one more piece of information. Because that's the frustration— frustrating part with rebates.

Yes.

And so we wanted to create a tool To allow our contractors to again differentiate themselves from the competitor. If I have 5 bids, which I'm hearing some consumers now are going to 5, 6 bids.

Yes.

Affordability again.

Yes.

But if I was the only one that mentioned all the rebates and said, oh, by the way, I'll file them for you.

Right.

Differentiation. That's gonna differentiate you.

Absolutely.

By the way, we're going with inverter technology instead of that old cube-style technology that's been around since, you know, Forever.

Yeah.

And, and so those little bits of pieces are going to really help you stand out and, and help you be the next Netflix or the next Airbnb in your marketplace.

Yeah. I want to dig into training a little bit. I'm very excited to learn about this. You, you guys are toying around learning virtual reality training and you're actually doing it, right?

Yes.

Right. Please let everyone know what kind of virtual reality training you're doing and the benefits of it, which I You know, you were talking to me about it before we hit record and I was like, wow, I didn't think of it that way. So please, I'll let you take over.

So I mean, I think everybody when they see a VR headset, they think, okay, games, kids, and this is what it is. But it is a very powerful, useful tool. Same thing like the iPad that we use in homes for estimates. I can see at some point in time where you may be doing a virtual estimate with a homeowner with a headset on because you've got the pass-through technology. We're not there yet, right? But we started out working with Interplay, it's got to be at least 7, 8 years ago now, okay, and building simulation-based training. Again, going back to my flying days, before I was able to get into a plane, they had me sit in a simulator, right? And everybody that flies to an event or goes fly somewhere on vacation, that pilot has spent a lot of time in a simulator so that they have all these different scenarios that they can play out and make sure that you're going to be safe and you get to your destination. That's what Captain Sully, he had practiced, you know, that engine out and being able to react quickly.

Right.

And because he had practiced it so many times in a simulator, that's why he saved all the people that were there. And so what VR allows us to do, we can take a brand new technician that's never installed a unit before, and I can say, go install this 10 times in VR.

Yeah.

Now they're going to be a helper out on the job. And when the lead installer says, hey, go set and level that unit, I've done that before. So now I'm not only am I speeding up my time on the job, the lead installer is not sitting there and explaining what needs to be done.

Yeah.

But because they've got muscle memory, they've actually done it.

Right.

They're going to be much more proficient and we're going to have less callbacks, less warranty. And we can continue to have people practice in the simulator and just make our techs that much more proficient, that much better in everything that we're doing. So we've built that out and we've actually made all of the modules that we've built with Interplay are free to the entire industry. So that's the other big thing that we wanted to do is anybody can go to HVAC Learning Campus, go to our on-demand simulation-based training.

Yeah.

They can create an account and they can start practicing installs. So that's another nugget that I would say to all of your members. Everybody go there and get free access. Start playing with it.

Right.

And then if you want more access, Interplay has a huge library. Then you have the benefit to be able to go ahead and pay and get access to more of what they have. But start off with the free version.

Yeah.

And just start practicing.

Sure, sure.

And then we took VR to the next level. So we actually built our own metaverse, if you will. Okay. We have a cigar lounge that we've built that can be in a bunch of different places. We've got a classroom that's actually inside of a condenser.

Wow.

And it's a theater in the round, so we've— we can show the presentations, we can show videos, but I can blow an air conditioner up to 20 stories tall. I can take a class inside of there and we can walk around and point out different components.

That's wild.

I can take everybody into the ductwork and say, okay, let's talk about airflow and air distribution. And it's, you know, it's Honey, I Shrunk the Kids or The Magic School Bus, however you want to look at it. And we are actually, you know, talking about it in the classroom. And I've got a screen in the ductwork and chairs.

Right.

And we're sitting and talking about airflow.

Right.

But we really can start to make these concepts come to life. But when I'm in VR, think about when I'm learning in a 2D environment.

Right.

If anybody's watching this right now, you're watching a video. How many of you right now are also on your phone and you're texting or you're distracted by something else.

Absolutely.

And so we see that happen all the time because everybody's trying to multitask. When I put a headset on, guess what? I'm 100% present. I can't be distracted by my phone. I can't be distracted by anything else around. And so we see that actually retention of somebody learning in VR goes up way higher. And the military has learned this. So military's been using VR for the last 20 years. Medical colleges have been using VR for teaching and practicing surgery. for the last 15 or so years. And so what they've learned is the retention is so much higher in a VR environment.

Yeah.

And that we as human beings, we live in 3D space.

Right.

And so I always ask people this question. If I ask you what color is the carpet in your living room?

Yeah.

What everybody just did in your mind's eye is you actually transported yourself back to your living room and you looked You literally looked down at the carpet, right? And, and you saw what color it was, and then you answered the question. You did that in a nanosecond. That's exactly how we learn. And so that's why retention goes so much higher, because we're in a 3D environment. When that person is now at the unit, yeah, or they're selling at the kitchen table, we can do role plays in VR and we can walk through the house.

That's wild.

Yeah, we've been trying to do this in hotel rooms forever. Oh yeah, classrooms. And yeah, I got to pretend that I'm there, but I can actually take the whole class the house.

Yeah.

And now we can role-play, walk through the house, go into the equipment room.

Yeah.

Look at the ductwork, and I record it, and then I can play back for the customer or for that, uh, that student exactly what they just did in the role-play, and the whole class can kind of work through the critique. And so there's so much potential.

Yes.

With teaching in this space, but there's also I get pushback. Well, I'm going to get seasick, or, you know, I can't get in, you know, I can't put that headset on, it's going to make me dizzy. Or in trade shows, when I set up the VR headset, what I inevitably have happen is a friend will put it on and then everybody else is messing with the person, trying to tap them on the shoulder or something else.

Sure.

And so people get a little bit gun-shy about being in the space or in the environment, but those that really embrace it, Yes. They start to see the benefits of it right away.

So I was going to say, because immediately I just thought it was just a fun niche, like, oh, this is what we're doing, right? Until you mentioned to me before we hit record that, no, it's just that attention, right? Because we're all getting our attention pulled left and right. And you're right, phones are there. Even in the in-person training, I always tell people to go to in-person training more than we offer, like a Zoom training. Yeah. Because it's just— but there's no distractions, right? That's Very cool. Very cool. Well, you guys are up to a lot of great stuff. Any other, kind of as we're parting, any last words of wisdom for contractors out there and how they can benefit the resources you guys have?

You know, the only thing I can say is right now we are in this era of perma-uncertainty, which I think is a great opportunity for everybody to really just push the envelope. So you gotta keep testing. You gotta keep trying new things and seeing what is gonna be that big thing that's gonna make you the next Airbnb in your marketplace or whatever it is. But also, it's super important that you make sure that you have the cash reserves. Everybody should make sure they have at least 3 months, if not 6 months worth of operating capital in the bank, because we just really don't know what's going to be happening.

Yes.

You got to think about fast and flat. You got to fail fast. This is the time to be doing all of those things because there is so much opportunity. And I can't wait. I think, you know, a year from now, 2 years from now, our industry is going to look dramatically different than what it is today.

It is.

It's wild.

It's changing fast. So, Ben, thank you so much. This was a lot of fun. Appreciate it.

Thank you so much.

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