The Confession Booth with Mike Andes!

Hey everyone, it's Mike Andes. Today we're going to be doing the confession booth. Uh, if you would like to call in, we garble your voice. And so our goal here is to be able to open up a window for you to be able to get real advice without it being public. And so obviously, if you ever want us to come out, do a turnaround show, we come out with cameras, we record the whole thing. But today the objective is if you have a problem with an employee, with a general manager, if there's struggles even personally, my objective is to be able to give a safe place for you to be able to share that and get advice and for me to give my opinions without everyone knowing who you are. So you don't have to say your business name, you don't have to say the name of your business, your— like you don't have to share anything. And your voice will be garbled. So you don't have to worry about one of your team members hearing or a problem arising from someone hearing this live stream. So that is the objective. People are already in the call queue. I will hop to that in just a minute. I wanted to go over a quick topic while people are calling in. So while I'm discussing this topic for the next 10 minutes or so, feel free to call this number here. It's 361-733-3332. Whether you're on Facebook, Instagram, YouTube, We are live on all channels. Feel free to call in and just be on hold. And then when you come in, you'll hear the beep and you'll be live with me here. And again, it'll be completely anonymous. You will not be exposed in any way, shape, or form. So feel free to share anything that you would like. We say Spill Tea mostly because it rhymes with anonymously. Spill Tea anonymously. However, my objective is really to be able to create a place where you're not having to safely say the problems that are happening in the business or be afraid of what other people will think about you or know who you are, and just eliminating that by garbling your voice, you not saying your name or the name of your business, and that's my objective. I've seen too many livestreams and Q&As where as you ask the question, you have to be thinking about like, what are people gonna think about me? What are they gonna say to me after this event? Is someone gonna call me? Is my employee gonna hear this? So I wanna strip all that away, and this is why we have the confession booth. So, gimme a few minutes, I'm gonna talk about a topic I think is really relevant to all home service business owners, and then we are going to jump directly into the call queue. Recently, we've seen a feature on Google where it's basically allowing the AI to either call or message businesses and ask for their pricing. And so I've seen a lot of people talking about this is going to be kind of the commoditization of pricing. Because if I can have Google, with the click of a button, go up to 2 or 3 different providers and ask for pricing, I'm gonna have a problem because now I can't be adding value on top of price and everyone's just gonna be, it's gonna be a price war. And so I wanna talk about this because I do not believe that's going to be the case. For the best operators. I do believe if you look at the spectrum of low-cost providers to ultra-premium home service business owners and brands, I do believe the middle is going to get squeezed because most people, when they have a problem with their HVAC, their plumbing, their electrical, there's one of two thoughts. One is, I want to get this solved for as cheap as possible. And I am price sensitive. That's the low end of the market. They do not care about your reviews, they do not care about your reputation, they do not care about how long you've been in business, your brand reputation, whether or not you have a website, whether or not your truck is wrapped. They just want the problem solved for as cheap as possible. I do believe that person is going to be the type of person that will use this feature and go after the price that when they get the prices back, It's the cheapest. All right. On the other hand, the ultra-premium customer is not going to be thinking about the lowest price. Jonathan Potocznik, who I do the podcast with each week, he had a great example of this a couple weeks ago on the podcast, and that was he had a moving company move him and his family, their house. And in doing that, they were using subcontractors to— actually do the labor. And someone that was moving the house, one of the subcontractors, stole, I think it was like $70,000 to $80,000 worth of stuff. And after that, they went to the business and the business is like, "Well, sorry, they're 1099s. I can't go after them." They filed the police report and that was kind of the end of it. Bad experience. Do you think that that homeowner, Jonathan in this case, will ever use the lowest cost provider? No, they're going to want to know what reviews, they're going to want to have a brand reputation. They're going to make sure that this business does have W-2s, is paying their employees more, is potentially more expensive. They're not going to go with the cheapest price. And I will also say that customer is the best customer. They're the ones that are going to accept upsells. They're going to be the one that if you diagnose a problem with the systems of their home, they're going to purchase more things from you. And so the best customers are the ones that are not going— they are not as sensitive to price. There are a lot of different components that go into a buying decision. And for many of us in home services, we came from very little and our mindset of scarcity keeps us from selling to people that do not have scarce resources when it comes to money. And so I know what it's like. For, you know, when there's a problem with the house, we're all like, well, we're gonna deal with it for the next week or two because we can't afford it right now. We're gonna deal with the next one. We're just gonna deal with it in general because the landlord's not gonna fix it. And I know what that's like. And so, as you have a business and you are service, trying to service a premium customer or a higher-end customer, they do not have that problem. And this is what Alex Hormozi talks about, selling out of your own pocket. Meaning, we assume that people are going to buy the same that we buy. And so because we do have a lack of resources or we don't have a lot of money or we came from that background where it was all about the lowest price, we think that everyone we're selling to is also that way. And that's just not the case. You are probably selling to the version of you that's 20 years into the future. When you do have a business that's doing well, multiple locations, a general manager, You have a couple million dollars worth of net worth. You have a couple homes. You go on vacation more often. That person is a completely different buyer than what your current mindset is, especially if you're in your teens, in your 20s, you're just getting your business off the ground. You're trying to dig yourself out of student debt or a past family history of not having any money. It's easy to sell out of our own pocket and just assume that everyone wants the lowest price. That's why when you see this feature from Google, you're afraid of the price checking. Now, a lot of people are thinking that if AI or an agent is going to scrub my website or it's going to call me even and ask for pricing, I should not give that pricing away or I should hide the pricing on my website. In my opinion, this is the wrong solution. I believe we need to embrace this and give the algorithm what it wants. Here's why. When Google put this feature out, it is usually contacting currently, again, this is, I'll probably date myself, but in the moment, 2 to 3 providers is who it's contacting to go get pricing. I want to make sure I'm part of the 2 or 3. And you're like, well, I have a really big problem with it giving pricing out and trying to commoditize the pricing in my industry. Okay, do you want to be part of the 2 or 3 options that are given to customers or not? And so, I do believe this is why I'm going to see the middle squeezed is because the best operators, the ones that don't compete on price, they're happy to give their price away because they don't— they want to make it very clear that they're not the cheapest option. Here's the thing. The best customer will look at two prices and sometimes take the higher one as soon as they see the website, as soon as they see the reviews, as soon as they see their social media, and they will do so happily and pay a 30%, 40%, 50% premium because now there's a, there's 2 or 3 options. In the past, when you went to Google and you searched, you saw 20 blue links, you saw a bunch of ads, you saw maps. And now with AI, it's going to get more and more focused on here are the 2 or 3 options, and I want to make sure I'm part of those 2 or 3 options. And so what are we doing at Augusta Lawn Care? We're making sure that our pricing is very clear. We've done instant quote pricing for 3 to 4 years. And it's been very successful in terms of customers filling out a form, putting their card information on file, checking out, accepting a job, and a very, very small percentage of estimates do we need to go back to the customer and be like, "Hey, your pricing was wrong. We need to adjust the estimate." Very infrequently. However, we've gone to the next level because when an agent scans your website, if it can't quickly find the pricing, it's gonna move on. And so, we've actually recently added an FAQ, frequently asked question, inside of every single location's website that actually gives the pricing for mowing. We actually give the square footage range of the property and the corresponding price for weekly and biweekly services. And we give all that info, like, the reason I believe this is important is because down the road, your AI agent will know where you live, It'll be able to scan your property, know the square footage, and if it can find that information on a website, it'll just tell the customer, here's exactly what your price is, and I'm very confident that this price is accurate because your property is this square footage. That's the type of information and transparency that AI is looking for. And so I believe that AI will expose the operators that have opaque pricing It will expose the operator that is going after the cheapest customer. 'Cause the cheapest customer will take you up. If you're the lowest bid when it comes back to them, the cheap customer will take the lowest bid. The cheap customer is not gonna make you any profit. Because they're not gonna accept an upsell. They're not gonna accept other services. They're not gonna take you up when you do an email or a text blast on recurring services or throughout your off-season. They're not going to do that. And so as we look into the future, not only do I want my website to be easily accessible to AI, easily digestible by AI, putting it in the FAQ section, having a pricing page. These are things that allow the AI agent to quickly scan your site and know exactly what the prices are. And I believe that the future, if we look out 12, 24 months from now, what is going to turn into is not only does the agent scan your site and look for pricing, it actually ends up going, taking it to the next level and buying the service and having a card on file. And so whether you look at Stripe or other payment services, they are thinking about how do we make agentic payment authentification where I have my, my AI agent, but it has a credit card attached. And so now instead of it just contacting 3 companies and asking for pricing and presenting those to me, it says, hey, by the way, here's the pricing. Would you like me to go ahead and set up service? And if they click yes, now it has the ability to go through my instant quote, fill out all the information, put the card on file, get service set up, and email the customer or message the customer and be like, "Hey, service is set up. Here's the price. They'll be starting next Tuesday." That's the future. And so, I believe that we can always push against this, but technology will keep moving forward. And one thing that I find very interesting, whether you look throughout history, is where have— where has technology always been? And it has created the biggest industry leaders. And what's going to happen, I believe, with AI and with all this, this idea of commoditization around pricing is going to be that people are going to look at big companies today and say, They're winning without using AI. They're using with— They're winning without sharing their prices publicly. They're winning. They have this mass— My biggest competitor is not sharing their prices. My biggest competitor is not doing instant quotes. My biggest competitor doesn't answer their phone. Here's the thing. They probably started 30 years ago. And so if you look at technology, whether it be like from Telegram, then it's like, oh my word, there's this thing called the internet. And then we have like email. And SMS text messages, and then you have to have a website, and then, oh my goodness, we gotta figure out how to make mobile devices will actually work on websites and forums because 70 to 80% of our traffic comes from a mobile device. AI is just the next step in that evolution. Now, there are companies today that are like AAA Lawn Care, A1 Lawn Care, A, whatever, they were optimizing for the fact that mobile or phone technology was becoming a thing. And the phone book was the, the AI of their day. And the same way that there is going to be people that are going to have all sorts of headlines and fearmongering around AI today, the same thing happened when it came to phone books. You know how much, how much paper is used with phone books? You know how many trees are destroyed with phone books? How many phone books are thrown away? I delivered phone books for 3 to 4 years when I was a young kid. That was how our family made by. On the weekends, we would deliver phone books. We'd stack our entire Dodge Caravan with tons of phone books and we deliver them. And what's crazy, I would see over and over and over again, customers would be a few houses down because we put them in these little baggies. They come out, take the phone book out of the baggie and put it directly in the trash. Do you know how much ecological damage was caused by phone books? And the headlines that could be wrote if we lived in social media today, that's what it would be saying. And so the same thing's gonna happen with AI. But if you go back 20 or 30 years when that new technology of phones was becoming accessible to everyone, there were companies that adopted and changed their whole name to A1, to AAA, because they wanted to be at the top of the phone booth, of the phone book. And so the same thing is going to happen today. Those companies 30 years ago made a decision to be on the cutting edge of technology and embrace it. And changed their entire business name to adopt this new technology. And they built the biggest businesses today. That's why you have AAA, that's why you have A1, and a lot of A's and 1's inside of businesses' names. Like, why isn't it 3's and 5's? 'Cause they were optimizing for the phone book in the early 2000s, the late '90s. And those businesses are today the biggest businesses. All right, fast forward. 2010, 2015. The companies today that are the biggest were the ones that in that era adopted mobile technology, adopted the internet, built the best websites, focused on SEO, focused on Google AdWords, focused on making sure their site was optimized and had a great conversion rate. Those businesses that adopted that technology in 2010s are the biggest businesses today. And when it comes to AI and making an agent-friendly checkout, Making sure that your pricing is transparent, making sure you have instant quotes. The companies that are doing that now will be the biggest businesses in the 2030s. Now, when it comes to this pricing commoditization, I still believe that customers are going to require a lot of trust that you will perform the service to a high level of quality and actually solve their problem. Because— Customers, when it comes to price, it is a piece of the buying decision. But the other component of making the buying decision is, will they actually solve my problem? What's the degree of trust that I have that the problem will be solved? That's the two major components of when someone's looking for an estimate. What's the cost, dollars and cents, but also what's the degree that I believe this is actually going to occur? They're gonna actually fix my HVAC system. They're gonna actually cut my lawn on a regular basis and show up. They're gonna actually paint my house without stealing stuff from inside of my room. That's the trust part. And I believe the thing that makes home services unique is that there's a high degree of trust required for someone to allow you to enter their house, walk on their lawn. This is why when I order these pens, I don't need a lot of trust because I'm ordering it from Amazon. And they're going to walk up my driveway, drop it off at my doorstep. I don't need to trust Amazon. I can see the brand of Expo, know that I've seen this brand a lot of times before. Other people I respect have used this. I have used these in the past. The brand of Expo, in this case, this marker, is good enough for me to know that I can trust Amazon to walk from the road up my driveway and on my steps. The minute that that Amazon driver would walk around the side of my house or open my door and go inside, immediately my wife would lose— like, we're looking at a security cam, we're seeing it, we'd be freaking out, and you would too. And the reason for that is because we don't trust Amazon to walk around our property, to come inside of our property. We've given them enough trust to walk down our driveway only, and I believe this is why home services That yes, there will be people that will go after the low-end bidder, the price-sensitive customer, but there's going to be people that have built a brand, that have built the trust required for the premium customer because the premium customer has been burned in the past by the lowest provider. They require someone that they can trust to enter their house, walk on their property, do so without them home sometimes if you're on a recurring service, And that is going to come down to brand. And I believe this is why brand will win. In the long term, brand will win. The same way that I have confidence in this Expo pen and this Expo brand, and therefore I can go buy it without thinking twice because I believe in the brand. Now, if I was getting some other random marker, I might look at some extra reviews. I might go and see if someone else is using it. I might look for a video or a vlog or someone that can give me more information about these pens. But because the brand of Expo is strong enough, I have confidence, I have trust that it's going to deliver. And so I believe that in the age of AI and price commoditization and people asking for prices from a tool like Google Local Services or these buttons that are being created that you're seeing all around asking for prices, coming back to the customer automatically, The cut— the businesses with the best brands will win. This has always been the case. The same way that when I go and I'm looking for shoes, if I see a Nike shoe, I'm pretty confident when I order the shoe and it shows up, assuming it's a legitimate Nike and I'm buying it from their website, it's going to be a pretty good shoe. Now if I start going on to all these other third-party websites, it looks a little fishy, I don't have any, like, there's not any Nike swooshes, I can tell there's a third party, I'm gonna have a lot more questions. Why? Because I have less trust that this is going to be solving my problem. And the same thing is true with customers when it comes to home services. There's a high degree, in my opinion, of trust when it comes to entering their house and walking on the outside of their driveway and their front door. Porch steps. Once you cross those barriers, there's a high degree of trust required. In those high-trust environments, I now have the power to have a premium price, assuming that my brand is strong. And this is why the companies that have the wrap truck, the companies that have a great website, the companies that are advertising in the local market, the companies that are being seen by that customer through time and time and time again in their, in their local market, inside of their neighborhood, they're gonna be the businesses that still win and can still demand a premium on top of the commoditized price of performing the service. All right, let's go ahead and jump in today. We are on the confession booth. You can call in at 361-733-3332. Let's go ahead and let the first caller in. Again, everything is anonymous. You don't have to say your name. You don't have to say your business, share, whatever. Is going on in your business now. First caller, welcome to the show. Thank you for coming on.

Hey Mike, thank you for having this today. Absolutely, what can I do for you? I just wanted to ask a question. Yeah, so I just recently been hiring employees for my business. We did last year $150K and this year we're going to $350K so far. So in my hiring process, I have hired 2 employees in the past month and I've had both of them basically after a while, no call, no show, and then you get like just, disappeared basically off the face of the earth. And I'm wondering if it's something I'm doing wrong, 'cause that's what I believe. I feel like I'm failing them and making it where they don't wanna work for me, or if it's just kinda what happens with hiring.

Yeah, so there's two things I wanna look at. One is going to be hiring process, and the second, the system for retention. And so the challenging part when you're at your size is it's very hard to give people a very clear path of how they can move up inside the company. Because you're so small. Like, I'm assuming those are your two employees and it's you and them, right? And yeah, it's very difficult for them to see, like, this is why larger companies in general, like, just having a big headquarter building and like nice trucks, for example, alone is enough for some people to stick around longer simply because they're like, oh, this company, I have the stability of a larger company. Now that does not mean that you're completely hooped. We can get to retention in a second. But first off, let's talk about the hiring process. So right now, how are you attracting talent?

Yeah, so these are coming from Indeed when I have them submit a video from Indeed, and then I do an in-person interview after that.

Cool. And then once you hire, like, you're like, yes, you're hired, is there any sort of onboarding process or training that they're going through?

Well, the training right now is just through me. I get their driver's license and all that put into the for the insurance and all that, and then I just train them myself.

Okay, which is fine. At your size, that's totally fine. And so you're saying it's like a month, 2 months, 3 months after they're kind of through that process, that's when they're falling off, and it's just random.

Yeah, it was like 3 weeks. I had one guy tell me he had a flat tire, and I was asking him about it, and then I never heard from him again.

Cool. So that tells me like, hey, your hiring process seems decent enough, There are certainly questions in your interview process you might wanna consider around how, for example, looking at have they done this in the past on their resume? If they've been jumping around jobs, high likelihood they're gonna do the same thing to you. And so whenever I'm like, out of my mouth I'm like, "I want someone to stick around for 5 or 10 years." Okay, if they've only stuck around at any other job for 3 to 8 months, I'm gonna be next. And so I'd be looking at that. It's also challenging. Because most people will not list the jobs they spent 2 months at. And so I'm gonna look at retention a little bit stronger. First, my first question is, from a pay perspective, are you basically middle of the market in terms of what you're paying the technician?

I'm at $18 an hour, which is decent for our area. It's not the top, so yeah, I'd say middle.

Okay, and right now, what's your hourly rate that you're charging customers?

About 80, 70 to 80.

Okay. And right now, do you have more work than you can handle because you don't have these employees?

Absolutely.

Okay, so there's two ways. When it comes to entry-level technicians, the easiest way to attract best, better talent is to be at the top of the market in terms of pay. Now, the only way, the only way we can afford that is to have a premium price to the customer. Now you're in this unique position where you're probably struggling to get the work done. It's a prime time to raise prices just so that you can make this like $22 to $24 an hour. Like, I believe if you said— if you were able to go out and pay someone $24 an hour, just hang with me for a second, I know that's high in your market, $24 an hour. But because you're over here charging, let's just call it $110 per hour to the customer, You can afford it. And—

Okay.

As I know that sounds like such an easy, dumb answer, but if you offer $24 an hour, they're not going to leave for the dollar or $2 more per hour when they're— that's what they're doing right now. Like the, I'm gonna go take a vacation for a week, and then they come back and the next day they leave. That is them looking at 5 other jobs the past week. Finding a $19 and a $20 an hour job and leaving. And so I would rather just get ahead of that, pay them $24 and attract all the best people from your competition that are currently getting $18, $19 and $20 an hour. And so now the type— the type of interviews, the type of applicants you're going to get should be a higher level. Now, you're in this unique case where you have so much work right now, you can't get to it and you need labor. Like, and if you were like, well, I can kind of handle it. I don't really need an employee right away. That's what I'd be like, okay, we got to figure something else out. But right now you're in a unique place to raise prices and then to be able to afford this. If you look at the cost of going from $18 to $24 an hour, that's $6 per hour. Let's assume someone works 1,500 hours in a year because you have an off-season. That is $6,000. That's $9,000 in the year. Okay, on a $350,000 annual revenue business, let's assume you have 2 of these employees. We're gonna pay $18K, $18,000, which is approximately 5% of revenue extra. That's the extra cost of having 2 employees that are well above market and are going to stick with us for the long term. My question becomes, will we make 5% more revenue or 5% more profit, either one, by having 2 employees that stick with us the entire year because we're paying top of market?

Yeah, I think we could.

Realistically, you could raise prices by 5% and be able to afford the extra cost of having these 2 employees. Now, do I think you should raise by 5%? No, I think you should raise prices by 20% At least. However, I just want to break down the math of what the extra cost of having 2 employees is, which is $18,000 extra by going from $18 per hour to $24 per hour. You're going to spend $18,000 more. That's going to be 5% or less of your revenue this year. And if that person can stay for 12 months, like, it changes the whole business. Go ahead, sorry.

Absolutely, no, looking at it like that, that kind of changes my whole perspective on it, 'cause 5% in the grand scheme of things isn't that much, but looking at it like day to day, the $6,000 or $9,000, it looks like a bigger number than it really is. So that's 100% understandable.

So here's how I would handle this, 'cause right now, it's very difficult to be like, I'm gonna go pay someone $24 an hour. I'm currently paying people $18 an hour, and my competition is paying $19 or $20 max. 24 sounds crazy. The minute you do that, the applicants you get inside of your hiring Indeed process, that quality jumps. The retention also increases simply due to the fact that now people are not going to leave you for $1, $2, or $3, or $4 more per hour. You're giving top of the market. And because you have the great retention, the quality of your service goes up. And so you're able to charge this premium price in perpetuity. Cuz now all everyone else that's paying employees $18, $19, $20 an hour is also struggling with retention, also struggling to keep employees. And when there's a huge churn of employees, quality of the product or service goes down. And that's why they can't raise prices. You're in this unique position where you have all this demand for your services and very little supply, i.e., people to do the work. So I would first raise your prices by at least 20%. I know that you're going to pay an extra 5% of your revenue to be able to afford this extra increase in pay. So why in the world would we not do it? And so this is a hard lesson that I had to learn because I was very cheap when it came to wages and labor. And I just realized that like retention is so important for the longevity of the team and for me to grow and be able to delegate. But more importantly, even at this size, smaller, the cost of retraining people, hiring more people, like if you just looked at how much you're spending on Indeed ads and the time you're spending on interviewing and then training new employees, I can guarantee you it is dragging your revenue down by more than 5% or $18,000 a year. If you just spent the time that you're currently spending on interviewing people, running Indeed ads, and then training them for 2 weeks and slowing you down the field by 50%, it's gonna be more than $18,000. And so, we now do our very best, as soon as we are able to be profitable in any department, to immediately give a pay scale for that department that is above market. And it has allowed us to be able to retain talent much better. And remember too, that employees want base pay. Like, base pay is the thing that speaks their language. If you're running P4P, great. Raise your prices. By doing that, you incentivize P4P more by increasing the base pay because that's the thing that the employee wants. They want the stability. They want the constant paycheck. If they didn't, if they wanted to have just like a percentage base pay, and that's all they relied on, they'd probably go start their own business. So when you're doing P4P, you gotta think in terms of the hiring and retention comes down to base pay. The P4P incentivizes them to push the envelope, go the extra mile, make more money, and be more efficient. But the thing that attracts that talent, they're always looking at base pay. All right, next caller. Welcome to the confession booth. Thank you for coming on.

Yes, hey Mike, uh, I run a recurring residential route in a not so grass-focused market with a lot more trimming and stuff like that. My first question is like, how would you position this? So I got a few different words like lawn care, landscaping maintenance, property maintenance, or like other things. It seems like everybody kind of uses a different word for these type of things, even if like— so that's what my question is. My first question would be like, how would you market or position a residential maintenance service in terms of wording?

Yeah, it's a tough one. So I would first— what's funny about this one is every single market we look at that is like this uses different words. Like, we can see the trends. The good thing is you can go look on Google Trends and see what people in your market are searching. And so I would first look at, okay, what are the 3 common terms? Which one is the highest? So if you're like, I gotta change the name of my business to a certain one, I would probably be using the one that's the highest searched. But there's, there's a high likelihood that 3 to 5 terms are being used, and I would just make sure I'm using them. I have a service page on my website for each of them, and I'm using them throughout my copy. So we use property maintenance usually at Augusta for our markets that are in the desert. Um, and then inside of that, we can do instant, uh, instant pricing, like small, medium, large properties. But there are some of them where we will change the copy on the page because we can notice that local market, people are using other terms besides property maintenance. So the first thing I'd say is like, go search on Google Trends to find like the best one, but usually it's like a combination of 3 to 5, and I'm just gonna make sure it's throughout my copy on my website, and then having a different service page that uses those terms. Does that make sense?

That makes complete sense. Now my main question would be, Like, I guess, what is your rule to keep, raise, or cut, like, a recurring client based on budgeted hours going over or not? Like, you have a rule, I guess, like, I track it really back end, but do you have a rule, I guess, where how you can tell when somebody is normal variance versus this client gone over 3 or 4 times, they need a price raise, or like, what is your rule of thumb for that?

It kind of depends if I'm in growth mode or if I'm in profit mode. If I'm growth mode, I'm probably not even— I'm gonna probably turn a blind eye to it. Until I hit capacity, and then I will raise prices then. Because I'm just trying to get as many customers as possible, fill the schedule, increase my route density. I'm not gonna be like, oh my goodness, we gotta raise their price by $5, we gotta raise their price by $10. I'm not doing that if I'm in growth mode, 'cause I know route density will cover a lot of sins. And I wanna focus more on getting as many customers as possible and getting to capacity. If you're in profit mode, i.e., I need to make more money this year, I don't have a lot of cash in the bank, I need to make sure every dollar and every job counts, That's when I would be thinking about, okay, let's do, let's say, a month worth of service and then go back and see, did we beat budget hours? Did we go way over? How much did we go over? Do we need to raise prices? The other thing you can do is just, as you do this more often, you'll be able to go to the first service and know right off the bat if the price is correct. Like, right now it might take you a month or two to get that data, but in the future you're gonna show up at the first visit and be like, okay, we misquote this one. And then just having the honest conversation with the customer and be like, hey, we've gotta adjust prices right off the rip. I would only do that though if you're in profit mode. And like, you are cash constrained, you don't have a lot of money in the bank account, or you're just trying to optimize for profit and not grow. But if you're, let's just say you can service 100 customers and you're at 80 right now, I would just let it run hot, fill the schedule over the next several weeks to 100 recurring customers, and then, I would assess which of my customers are the, the worst offenders of budgeted hours.

Okay, that makes sense. And then, and then worst offenders, you just sort through that in like wherever you're tracking those budget hours versus actual hours, and then you look at that and just look at it by client. Is that would be the best way to probably do it?

Exactly. Like when it— when I, when I say we hit capacity and raise prices, when you hit capacity and you raise prices, there's two ways to do it. One is We hit capacity and we raise prices across the board. I usually have people do this because it's easier and it takes less work. That's why I usually push that way, is because, like, the likelihood of them actually doing it is higher. The more detailed approach, or the more precise way to do it, is you hit capacity and you assess all the lowest paying customers and raise prices on them first. And so I'm not opposed to that. What usually happens, though, People spend way too long debating which customers they should raise prices on. Every single one becomes weighed out. It's like, well, they're a good customer, they're a good area, I like this neighborhood, I wanna grow more, and they end up never raising prices. The other thing that happens is they raise prices on their lowest paying customers and no one leaves. And then the only thing they can do is go raise prices on all the other customers that they are like defending and not gonna raise prices. That's the only option 'cause they're at capacity. And so, they just wasted weeks of debating instead of just raising prices on everyone like they're gonna end up doing anyways. So, that's why usually I tell people just to hit capacity and raise prices across the board, but the more precise way of doing it is, okay, I hit 100 customers, I'm at capacity, and I don't wanna keep growing capacity. I don't wanna grow trucks, don't wanna hire more people, great. Raise prices across the board, option number 1, or option number 2, I am going to look at which of my customers are the lowest priced Raise them first. And the reason what most of the time happens is if you're actually at capacity, you can't take on more than 100 customers, you raise the prices on your bottom 15 customers, none of them leave, 1 or 2 of them leave, and all of a sudden you're just raising prices on everyone else right after that. So that's why usually I just say raise prices across the board. Next caller, welcome to the confession booth. Welcome, welcome. Hello.

Uh, hello.

Hey, how's it going?

You hear me?

I can hear you. Can you hear me?

Yeah. Oh yes, I can. Uh, so I don't, I don't know where to start this, man. I'm, I'm sitting in my truck, uh, and I'm about to have a mental breakdown. So like, um, just some backstory. Um, I'm 23 years old. Uh, I've been married since the end of 2024. I have one child, there's another one on the way. Um, and I have about 10 quotes I gotta send out like today and a job I'm behind on. Yesterday I had to, or excuse me. Was it— I can't even remember. I think it was Tuesday or Wednesday. I had to actually give my half the money back to the customer because mentally I just couldn't focus on it. Uh, my wife wants a divorce. I am going to marriage counseling. I'm trying to go through anger— I want to go through anger management. I can't talk too much about it, but just so you know, like, me and my wife are legally not allowed to see each other right now, so you can envision what that means. Um, and I'm ambitious, you know, I, I grew up with nothing, you know, like, I mean, it wasn't— I never went hungry, but, you know, I could tell we could— we didn't have nice clothes like the other kids did, uh, we weren't taking vacations. I can remember maybe 2 vacations in the 18 years I lived at home. And I'm actually back living with my parents right now, but I can remember maybe 2 vacation— actual vacations. The rest of the time, I just never— it was going to my grandparents maybe every 2 to 3 years, sitting on the couch and watching movies. And looking back at all of this, I was like, you know what? It's because we didn't have money. Similar to your situation, my dad's actually a pastor. I have struggled with it. I'm to the point where I'm struggling with my faith. Like, I, I, I'll just be honest. I'm agnostic. Uh, I don't, I don't know. I just, I'm young, I'm struggling and I don't know what to do. Like I've raised prices on my mowing customers. I would say right now the bulk of my work is coming mostly, uh, the landscaping. And then, so right now, probably, uh, I would say 70% landscaping and then a little bit lawn care with mowing. This year. I raised prices on my— all my mowing customers that, that cut out some of the bottom feeders. And, you know, I'm trying to learn my numbers, I'm trying to read books, but it's just like everything's crashing down around me. And when we got married, I did not have enough money saved up. Uh, that was a bad situation. My wife was being kicked out from her parents' place. What is going on now I realized that the reason why she was kicked out, um, it's just I was young and dumb and I'm paying for it. And man, I've, I've never cried. I've never been in so much stress in my life. Like, I'm ambitious. I want multiple businesses. I want to actually make money. I don't want to have an F show, pardon my language, but like, I want I want to have a family. I want to do good. I want to be a good person. But it's just like, I don't even know if I'm making sense right now, man.

You're good.

You're good.

So, you know, in one call, I'm not going to solve all these things. There's a lot to unpack.

I'm breaking up a little bit. Sorry.

You're breaking up? Okay. Yeah, so the first thing is, when you look at your business, because I'll focus on that part. Which of his services—

I can't hear.

You can't hear us? I think you might be breaking up too. Can you hear me okay? Check, 1, 2, 3. Can you hear me?

No, it's cut. I think my connection might be—

Here, what I'll do, I'll drop your call so you can listen to my response, just so that way you can actually hear it. Is that fine?

Can you hear me? Check one. I can't. Testing, testing. I can't, I can't. I don't know what's going on right now.

Okay, I'm gonna drop the call and then I'll respond and then you can listen to the recording or like just hop on YouTube and watch live.

Oh wait, no, I hear—

Ah! He started hearing me, I guess, at the end. Okay, let's see if he hops back on. Okay. If he hops back on, Jace, you can interrupt me. So, obviously a lot of things are going on. I'm gonna focus on the business side. When you're 10 quotes behind, you're giving money back because you're overwhelmed on jobs. I'm gonna focus on the business side. If you're behind on 10 quotes, you're way behind on jobs, you're giving money back on jobs, We have to ask ourselves, why are we even taking the estimates? Why are we even setting up these quotes? Why are we allowing the customers to even get on our schedule? We've gotta pare down and simplify to what services do we actually make money on. If you're giving money back on a job, it is a telltale sign you should not be doing that service. It is too complex, it is not simple enough, you're messing things up, and therefore you're giving money back. Whatever that service was, you didn't feel good about the quality of service, I appreciate that, you're an honest person. Give the money back and don't do that service again. Take it off your website, don't post pictures about this job on your social media. Anytime you give money back, it is a massive red flag that you should never do that service again. 'Cause if I can't confidently make money on every job, if I can't confidently be able to get to a price point, where I know I can make money, get rid of the service. You're like, "Well, it was really good money. It kept us busy during the winter." You lost $15,000. Stop doing it. And so that'd be the first thing is simplify down to the services that you know you make money. If you're behind on 10 quotes, you're behind on jobs, we've got to figure out what are the 2 or 3 things that we do well that I know happens every single time profitably. And cut everything else. That's the first thing I'd be doing. The second thing I'd be doing is focusing on the recurring revenue side. And this is why I talk so often about adding recurring services, because when you have a mental break, for the vast majority of people over the course of their career, it'll happen at least once. There'll be burnout, there'll be personal issues, physical issues. When this happens, having recurring revenue is your lifesaver. It prevents you from losing everything. And so, I am going to simplify down to the services I know I can make money on. And I know right now most of your revenue is coming from these projects. That's fine. Which of those projects do you know you can do, your crew can do, every single time profitably? Everything else gets stripped out. Look at your website, everything else stripped out. Pictures, video, anything that shows the services that you know you can't do every single time profitably, out. Immediately we're gonna reduce how many quotes are coming in Because now we're not going to set up services for any bid that comes in. It's going to be the 3 or 4 things that we do well, that we know we make money on. Those are the only time we're going to be setting up a quote. We're going to focus on the recurring revenue side by going through our database, texting and emailing all the customers in there and trying to sell them on recurring maintenance. Trying to sell them on the project. Hey, we installed this. We're also now doing maintenance. I'm going to focus on that recurring revenue because that's going to be your lifeline When you're going through this problem and a lot of the issues that are going to happen in the personal life, the ups and downs going through that divorce is brutal emotionally. That is a recipe for disaster on one-time projects that you're not confident doing. It's a recipe for disaster when there's going to be days you just don't want to work. There's going to be days you wake up and you don't want to get out of bed. Instead of trying to say, "Just work harder." I'm not going to say that. And I say, there's going to be times you hit really low moments, you're going through this process of the divorce. I wanna make sure your business doesn't fall apart. And to do that, the likelihood of it being recurring revenue and being able to get through that day when you can't work, when you just are completely checked out, is higher with recurring revenue. And it's definitely not going to work if there's projects that require you on job sites that you can't confidently be profitable on, that are falling apart, you're running around like a chicken without a head. That's going to add to the problems that are happening on the personal side. And so from a business perspective, I would be focusing on simplifying services down to the ones I know I can make money on. Any time you give money back, that service needs to get cut. I understand it's hard to turn away someone that's wanting to give you money, but it is currently the thing that is causing the mental breakage because right now you are spent just putting, deploying energy and effort and money and energy towards the personal issues. And so I would highly recommend the focus on the services and focus to make sure that we can preserve that energy that's currently being deployed to these quotes that you shouldn't be doing and the services we shouldn't be doing and deploy it towards the most important part, which is your personal life, your faith, etc. I think that caller came back in. Here we go. Where is it, Jace? All right, here we go. Hopefully you can hear us okay.

Can you hear us okay now? Yes.

Okay, fantastic. I can hear you. Um, were you able to hear what I was just talking about?

Yeah, so like simplify, uh, services and focus more on the recurring side of things.

Yeah, when I say simplify services, it's mostly the ones that, like, the job you gave the money back on, that service we can't do it again. Any job that's requiring you to go out and, like, how many employees do you have right now?

It's actually just like, okay, I've had quote-unquote helpers, but mostly it's just me. So like, I'm a solo guy who's maxed and—

Okay, how much—

One thing I did not say is before this, so I'm out of it now. Well, so far, but there was a year that I was on an IRS payment plan, which stressed us out financially. And just all this stuff going on, like I'm trying to learn my numbers. I'm at that point, I'm at that point where I'm like, oh, this is what it actually takes to build a business. And I'm at a crossroads, like, Am I going to put up with this pain or am I just going to give up? And I'm a very stubborn guy. Like, I grew up doing martial arts and stuff like that. Like, I don't want to give up, but this is the hardest point of my life. And I don't— I don't know what to do.

How much debt do you have? And do you still owe the IRS a bunch of money?

I do not. No. Good, good, good. We are out of that. I did, raising prices helped, cutting all, you know, I cut as many expenses as I could.

How much monthly revenue do you do that's recurring? So if you had no new projects come in, how much do you think in monthly recurring revenue you have right now?

So, okay, so recurring, so most of my recurring would just coming from mowing, and that was, I think that was around like 5.

5,000?

5K.

Okay.

Around.

How many customers? You have like 30 or 40 customers?

Yeah, around 30, 40 in that range.

Okay. How much do you need personally per month to live on?

So my personal bills, um, let's see, it's under $2,000. So like my rent is like $800.

That's awesome.

Okay. And let's see, my car, obviously I got some car insurance, food.

Can we say $3,000? I think $3,000. You can live on $3,000 a month?

I would, I would say about around, just around $2,000 or maybe just a little over $2,000. Okay.

Okay. This becomes a little easier. So excellent job paying off the IRS debt and keeping your expenses down. That makes this actually a little easier. I'm going to be a little bit violent with this, but this is what I would personally do. I would stop all one-time jobs and I would only do your recurring work. And that means the 10 quotes that are on the board right now, we're gonna call the customers and just say, hey, we're booked out 3 months. You can either have the quote or I'm sorry. Any new jobs that come in, if they're not doing recurring, we're not taking them on.

Yeah, would you recommend that, like, Maybe just tack on a little bit extra to that quote so that if they take it, I can maybe—

No, no, no, no, no. You're trying to take on— No, the reason you're having the mental break and like you're going is because you have so much on your plate and I'm trying to reduce what's on your plate right now so that you get through this time in life. You will build a bigger business, but it's not happening this year. This year, we're going to focus on surviving. With the recurring revenue. And I happen to believe that this recurring revenue, by you just not doing one-time projects, will actually trickle up to the point where over the next few months, you email and text your customers, you get them on plans for recurring, you get mowing jobs only, 'cause now you're not chasing your tail on jobs that you're giving money back on. This will probably trickle up to $8,000. I don't care about your business this year. I need you to just, I need you to get through this time so that on the other side of whatever happens with the personal stuff, that we can build a bigger business. Like, the only way to fail is to quit. And you're gonna quit if you keep doing what you're doing. And that is, I'm being pulled between I wanna keep growing this business and I have tons of ambition, but also I'm in my truck and I don't wanna do anything. And so, it's okay for the next 6 to 12 months, you're like, I do not have the personal bandwidth or capacity to be able to focus on getting big jobs that I'm losing money on. If the— kudos to you for paying off the IRS debt and then having your expenses so low that right now, right now, this is like an immediate fix. You can just live off your recurring revenue. If it's just you working, let's just say on $5,000 recurring revenue, maybe $1,500 in expenses, trucks, equipment, insurance, etc., you can pay off your personal expenses. I want all of your time and energy focused on the most important thing in your life, which is you Your wife, your kid, your kid coming that's about to be here, and being the person that needs to show up for them. And then secondly, you personally from a mental perspective getting through this time so that we can go grow the business later.

Yeah.

But don't let your ambition drive you into the ground because you're being pulled to grow the business when right now is not the time for that. Yeah, you gotta show up. Like, so did this— during this divorce process, let's assume it goes bad. I, I don't even— I don't want to get in your personal life. The divorce part, if it goes bad, you're gonna need personal bandwidth to be able to make good decisions. Those decisions are not going to be good when you spent your entire day in your truck freaking out because you're way behind on jobs, you're giving money back on projects, you're way behind. I need you thinking clearly. And I also believe that if you think clearly, you'll make better decisions. And it might not be so bad because you'll make good decisions to make sure that, like, you don't say the dumb stuff. You don't have anger. Like, you don't have bursts of anger that come out and burn you in court or burn you in the negotiations or even burn the relationship. Is— you can say this like, you don't have to answer this. Do you think the relationship is final, like it's done, done for good, or is there hope of trying to get that resolved?

So I don't want to say too much, but basically, like, we're not allowed to see each other right now. And there's a— Yeah, I got you. Okay.

But is it—

She's been wanting a divorce.

Okay, okay.

So she, she's been wanting a divorce up until this stuff happened. She has communicated with people I know that say she wants to work through it now, but there's still hope, but it's, it's, it's, it's at the, it's at the edge of the cliff, so to speak.

Okay, so it's not over the cliff, and this is why I want you to be violent. Assuming you want that relationship, that you will make that decision without me. If you want this relationship, you take violent action on the business so you can deploy huge amounts of energy towards the things that is most important to you. And right now it is not the business. And the only way— and this is my opinion and I do not have context of what you're going through— the only way to save the relationship is to deploy so much energy towards it that she knows you're going to make changes. And a really good reason for her to think that staying with you is going to be different in the future is that she sees you make massive action on the business that she knows is not you. She knows you're usually driven and go, go, go and add more jobs and add more work and get more stress. And that's likely down— let's rewind— that caused a lot of the friction in the past. Just prove her wrong by changing the business and doing what's right for the family. Assuming you want to save the relationship, because that's the only hope.

I think there's a lag or something going on.

I think we might be having phone problems, but I think that's most of what I wanted to say. Thanks for calling in. Yeah, this is why we have the confession booth. So thoughts and prayers with you, and you are in a tough spot, but I just want to get as much off of your plate as possible. This mental break cannot fully materialize, and to do that, we have to take things off of your plate from a service perspective, from a backlog perspective, from a financial perspective. Fine. I'm so thankful that you have $5,000 recurring. Just focus on that. You can do that in 20 to 30 hours a week of work and then deploy all of your energy towards saving the thing that is going to ruin the business, tear you apart, have a mental break, and hopefully save that. So, all right. Thank you. We have a full call log. I'll come to that in just a moment. If you would like me to come out in person, and help with the business, we do the turnaround show. And so I fly around the country, it's completely free, it doesn't cost anything. The guys made a little highlight reel here, it's pool cleaning business, but we fly around, it's usually my wife, one or two videographers, and our goal is just to, you know, document even what we just did here, but in a way where everyone can view it and learn from it. And so the thing about business is it's very lonely. And for people like the caller just called in, they see no hope. And I have seen too many people quit during this time. I have seen too many ruined relationships because businesses that were run incorrectly. And that's what— why I wake up every day and do this. That's why we do the Turnaround Show. That's why we do the Confession Booth. And so I'm so passionate about this. So, huh. All right. Let's go ahead and go to the next caller in the Confession Booth. Welcome to the show. Thank you for coming on.

Hey, how are you?

Fantastic. How can I help?

Hey, so, uh, I guess one of those questions, uh, essentially gone from about $100K up to— I think that you were hitting about $1.2 million, and I kind of just have the personal dilemma of when do I stop to smell the roses a little bit and enjoy life? Uh, like, 24, I want to move out, want to get a house. There's a neighborhood over here I want to build in. And but it's, you know, I feel selfish if I stop, uh, you know, putting all my focus and money back into the business and like start paying myself even halfway decently so that I can, um, you know, start doing things in my personal life. So it's just, uh, I guess it's like a question of do I keep pushing and stay in the current living situation I'm in, just staying at home with my parents and, you know, grinding it out until I get kind of that $3 million-ish goal that I think I can hit in 2 years, and then like from there enjoy life a little bit, or should I start accepting that I have a business that's, you know, successful now and, um, And living a little bit.

Random question for you. Did you grow up religious?

Uh, Catholic, yeah.

Yeah. So many times I ask that question because it is the idea that spending money on yourself is selfish. Many times comes from this notion that the money itself is bad and we should be giving all of it away prior to us taking anything in return. The problem with that is it leads to burnout. Because if you don't spend anything on yourself and you're constantly holding your breath, eventually you pass out. Like, you can hold your breath and get to $3 million. My question is, why are you building the $3 million business? And for many of us, we can have a $1.2 million business and achieve everything we set out to do when you're at $100K at $1.2. But we're holding our breath for this arbitrary number of $3 million. And once you get there, you have more money. And then you're gonna feel more selfish spending it. And so I will say this, I believe you'll get to a $3 million business faster and enjoy the process more if you do, I'll use your terminology, smell the roses. And how that looks is you spending money on things that give you time and energy back to make better decisions in the business as the leader. 'Cause what got you from $100K to $1.2 is brute force, work ethic, and determination. That will not get you to $3 million. What's going to get you to $3 million is structure, systems, and great teams and building a great team. And the thing that brings those things into your business is great decision-making. And great decision-making doesn't happen when you're working your finger to the bone. You feel like you're completely exhausted. You don't have a house, like your housing situation isn't the way you want, and you don't feel like the business is serving you. The business is built to serve you. You are not built to serve the business. And so like when you started out at $100K—

Yeah, no, I think that's—

Go ahead.

No, no, you're fine. I thought you were done. Keep going. You're good.

I was saying when you started the business at $100K, what was the reason? Like, you're only 24. You're crushing it. Are you married? Do you have a family? Like, or are you still single?

Uh, I got a girlfriend, but you know, like growing up my dad had cancer and I couldn't mow the grass, so I started doing it and then it was my way to get through college and I just graduated, uh, last May. So I've been out of school super, super recently, but, um, I guess I feel like this pressure to like get it to a big size, it's like my business mentors He runs a private equity firm, uh, like family has one of the bigger law firms in Illinois. So it's like there's a lot of— like, to me, it almost kind of the environment I'm in to a degree, like outside of like my immediate family with extended family and some of the people I've been fortunate to be around is like a million dollars is kind of the starting point. And, uh, I guess it's kind of like a a weird mental block there to think that like I'm like, I still haven't really done much. Yeah, I feel guilty like stopping now whenever I know like my personal capacity is, is way larger than what is being maxed out now like at. And I guess because of that, I feel like I haven't really done anything yet, so like I shouldn't enjoy the fruits of that labor. But then also it's I feel guilty taking the liquidity out of the business for my personal life whenever, you know, it could be needed later to accelerate growth.

Yeah, so you are— you're— I'll be blunt because I know exactly where you're coming from. You've allowed your circumstances and your surroundings to dictate your life. You have grown this business and you have taken nothing from it, and you have served the business That's why it's done so well. But you have, you have bought into the notion, and I did in the past too, that everything is about everyone else. And because of that, it'll lead to burnout. And the reason I know this is because you have not clearly defined what do you actually want from this business? Like, what's the point of going from $1.2 to $3 million? Is it just a checkbox from everyone else's perspective of you being a successful entrepreneur? Or is there something that actually is going to unlock for you, for your girlfriend, for your future life? Like, if there's not, or you don't know what's going to unlock for you, you're gonna get to $3 million and it's gonna feel empty. And so I would be very, very intentional with why am I growing this business? Because I happen to believe if you strip out the expectations of a private equity person or like a friend or family or whatever that's trying to make you grow the business, you're just gonna resent them when you get to $3 million. You take the next 2 years, You serve the business more, you know, less straw, more bricks for the next 2 years. You get there and you're going to feel empty again if you don't know why you're doing this. And so I'd be very clear if I was you, why am I growing the business? If I don't know why I need to grow a business, I stop growing. Because why am I like, what, what's the point of building a business when you're 25, 26, 27 to $3 million when you're gonna get to 27 and be like, why did I do that? You're gonna feel the exact same way unless you need the $3 million business to do something for you. Not for anyone else, not for their approval, not for what they think about you. You're in the top like 8 to 9% of entrepreneurs 'cause you have a $1.2 million business. And so anything or anyone or any environment that is causing you to feel less than or that you're not successful, I would run away from that. Because you're on this treadmill of trying to please other people, you're feeling selfish, like this is like a, This is the classic, like, martyr's dilemma, and like, you're gonna run yourself into the ground. And back to the last caller, I don't want you to have a $2 million business. I'll say this, and just take it with a grain of salt. I don't want you losing this girl, or someone that you love, or being in a mental place that's a bad spot, because you grew a business to $2.5 million, when you had no business building a $2.5 million business. And I'm not saying you shouldn't do that, or you will not. You're not capable of building a $3 million business. I just want you to know why you need to build that size of business before you go spend the next 2 to 3 years, the best years of your life, pouring into a business that you don't know why you're doing it.

Yeah, I guess, can I ask you a question then? Go ahead. I think it's really relevant. So, like, I know you stayed in the closet and obviously, have a dream of, you know, going public, an IPO, and everything that comes along with that. And I guess, how did you justify that? And I know like a big part of your vision is, you know, the whole 'I need to dream big enough that other people can fit inside of it,' and we, you know, rising tide lifts all boats. But from like the, I guess, the selfish side for you, where like, what's like, what's your personal justification for like going that big and for whenever you could have been living a good life, like nose to the grindstone, like the Alex Becker way, staying in the closet and living off of, you know, like essentially nothing.

Yeah. The thing is, I get, I am, I have realized that my why and like the reason I need to build the big business is to achieve a certain goal. Along that way, the thing that lights me up and I get energy from is being able to help others prevent the pain that I went through in their own life. So I try to talk to the 18-year-old and the 20-year-old version of myself so often because I'm trying to prevent the pain for other people so they don't have to go through that. And so, for example, this morning, I was like, didn't want to get out of bed. I'm just drained. I'm not, I don't feel inspired right now. I have a big project I'm working on. It's way down the road. but I do the confession booth 'cause this is what turns me on. This is what I'm excited about. And so yes, the monetary goal of— I'll use your terminology— building the $3 million business has a very clear reason why I'm doing it. And along the way, I am selfish by taking this call. I am selfish by making this content 'cause this is the thing that turns me on and reignites my passion to go work on a project that no one will see for the next 6 months. And it's because I've clearly defined what turns me on. Why does this business exist? Why am I putting my grind— my nose to the grindstone? Why do I still spend nights up trying to figure this out? And so finding that is the thing that unlocks the discretionary effort that you're looking for that doesn't feel like a grind. Like, you can build this business past $3 million. You can build a $10 million business, assuming You figure out why you need to, and then you have so much energy and passion towards it, instead of you beating yourself up and feeling selfish at every single step along the road. I'll say this, there are plenty of private equity and law firm people that wanna shoot their brains out, and I would not trade my life for anything.

Oh yeah, for sure.

Right, and so I don't wanna ever Allow someone else's idea of what success looks like or what they think I should do, because you will resent them. If you love them, you will even end up resenting them when you build a business for their approval. You get there and realize it's still empty for you. You still feel selfish taking money out of the business. So the only thing I can say is figure out why you're doing it. And until you know why you need a bigger business, stop growing and let the business serve you. Does that make sense?

Yeah, it makes sense. I guess like up to this point, like, I genuinely just— I love— I just love what I do and I love going hard and I love— and I feel like to stop would be a disservice to myself and the business. And but I, you know, I think I also need to kind of explore the— like, there's some arbitrary things of like house I want to live in, cars I want to drive, things like that. But I guess deeper than that, what's the point? Where do I want to get? When do I want to— Yeah, I mean, it's eye-opening.

No, you're good. I think I would examine within myself if you want the house or is this also for someone else's approval? I'm not saying it is. I'm just saying, just look inside yourself. And it's so funny. This is why I think so many people, when they build about where you're at in terms of size of business, they can achieve all the goals they set out to do. But there's this constant notion that I need to keep growing because I can. But like, you're going to get to a $3 million business. And are you still going to want the house? If you want the house, go buy the stinking house. You can afford it. You're 24 years old and have a $1.2 million business. I'm going to assume for a minute it's profitable and it's doing well. Like, —And if that house unlocks the ability to be able to start a family and you get joy from that, that's the thing I want you to focus on because now, this is why people that have families and have kids make more money, is because there's a reason why they have to wake up in the morning. There's something pulling them to go deploy energy towards the business. Right now, you don't have that. And so, I would get really clear why you have the business, why more money is even something you want to chase after. And if you want to, I think you can get there. I think you're a very capable entrepreneur. You could build a $10 billion business. But I don't want you building a $10 million business and then resenting every single person that had expectations of you. And then you get to $10 million and also still feel selfish, don't wanna buy the house, and you've squandered the best years of your life. Cool, you're the man. Thanks for calling in, brother.

I appreciate it. Absolutely. Take care.

All right, let's do a few more callers. Welcome to the confession booth. Thank you so much for coming on the show. What can I do to help?

Hey, what's going on, Mike? Um, can you hear me?

I can hear you. Can you hear me?

Awesome, awesome. Yes, sir. Yes, sir. I just want to start off by saying thank you for, for what you're doing now and, uh, for what you do. I genuinely don't think I would be where I am without all of your resources. So from the bottom of my heart, I really appreciate you.

My pleasure.

So right now, you actually just did a little video diagnosing my business recently, and man, do I wish I saw that a little sooner. All the advice was extremely relevant. And I ended up shooting myself in the foot, kind of. Um, I put the— I don't know how the saying goes, the carriage before the horse, the horse before the wagon. Um, I'm sure you get what I'm saying here, but, um, I did that and I did not prioritize recurring work even though I thought I was. Um, I guess I just couldn't really see the future and didn't know how many leads I was going to get. Um, then you were right in the video by saying Assuming we are drowning in leads. We were certainly drowning in leads. Thankfully, it slowed down a little bit, which double-bladed sword, kind of makes me nervous, but I know at the click of a button and I get active, I can easily start the funnel up again. That all being said, we're extremely behind because of the extensive lead flow. I made the decision to do what I said I was going to do and start growing and really take a jab at going from solo to actually hiring. Um, so we did $40K in March, um, whereas to the last year in March we did $3K. Um, so massive, massive amount of growth. And, uh, we made the moves to channel that growth into, you know, being an employer and actually, uh, scaling this thing up so I can stop using my body. Because as you may know, I don't know if you figured out who you're talking to yet, but I got the atrophy in my shoulders and, um, I, I get burnt out very easily because of the— oh, there's a lot of compensating that's going on. And being a solo, I find myself only working 6 hours a day on a good day. As soon as I have somebody to be responsible for, I'm up at 5 in the morning, we're working, I'm working 12-hour days again. You know, it's, uh, I need to care more about myself. I, I understand that, but Um, as to what you were kind of saying before with the other callers, what lights me up is other people. I like to help other people. Um, and that's a big part of my why is I grew up very poor, very, very poor. And, um, I now have a kid and I need to provide for him. This, this why is so when he is growing up and he can have anything he wants so long as he's going to work for it. And I have something that I can either pass down to him, or he has the option through my financial success to do whatever he wants.

Okay, and so right now, what's the problem?

Sorry, somebody just came up to me. Um, my truck's a billboard and I had somebody just stop real quick. Um, so the problem right now is trying to figure out how to make this work with my injury and lack of funds. So basically we, although we're getting a lot of work being a sole provider of a family of this size, we don't really make any money. Like, I mean, we do, but it's not enough to, to, to invest heavily into the, the hiring funnel. Um, so we did end up hiring 4 guys, um, just so we could have room for failure and then hopefully keep 1 or 2. And we did, we kept 2. One started to diminish culture and started making executive decisions behind my back. And I ended up digging into that. Found out about it, asked some questions. The, you know, the toxic one pointed the finger, and the rock star took full accountability and ended up giving him a promotion. We ended up selling enough recurring work to put him on as a solo mowing crew, and, uh, he was taking care of 30 lawns by himself. Unfortunately, he called me crying one day, got into a rough breakup, and, uh, we were booked out at the time for 2 months with just me and him. Him working by my side landscaping 3 days of the week, and then the other 3 days of the week he was working into Saturdays. He was mowing while I did projects, one-off maintenance and cleanups and all that kind of stuff. Now he's gone and we, we are trying to hire, but I guess my question in all this is how, given all my circumstances, given the messed up body and the inability to just Big in, um, what, what can I do to keep the ball rolling at this speed without going back into being a solo that's only working 4 to 6 hours a day for $120K a year?

Yeah, I think the biggest shift will be changing your identity. Like, what had got you from going from $3,000 a month to $40,000 a month in 12 months is you have done the work. Now, this is why I encourage people to not be solo operators in the long term, because eventually you do the work long enough and like you've experienced, you do burn out. Your shoulder gives out. You just run up against this thing called your body having a— having struggles. And so the identity that we will have to change for you to continue to be growing the business and being successful is you have to take less identity as a doer and start becoming a great teacher. And the reason most people will not do this is because it is hard. It is hard to change your identity and learn new skills. And so the same way that you learn how to do all the different services in your business, now doing those services will break you. What I want you to do is figure out how to teach those services and doing of the work to other people. And so when you hire them, you are not doing the work alongside them now. It is an expectation that you are going to teach them how to do their job You're going to have standards, you're going to have systems, you're going to have KPIs, you have scoreboards. And if you're like, well, we can't afford that. Great. We're buried in leads. So raise prices so that you feel confident enough to teach instead of do. And so if there's cash constraints in a business and you're buried in leads, you're growing fast, you have way more work than you can handle. Raise prices to give yourself the leeway to teach. I happen to believe that when you spend more of your time teaching instead of doing, hiring and retaining those employees and ensuring that they do good quality work, they don't become a cancer to the organization, that becomes easier. I should say, in the environment of a great teacher, great culture happens. In the culture In a business where the business operator is just doing the work all the time and their identity is wrapped in that and they don't teach their team well, they don't lead their team well, as the business grows, it stunts the growth of the business. My prediction, or what I would say, is you will stay at $40,000 to $50,000, maybe $60,000 a month in revenue until you figure out this skill. And so, the capacity Your personal capacity currently is limited at the ability to do the work and you do it well. That same skill will be the thing that prevents you from being a great teacher because you'll keep jumping in and doing the work. This is why most people stay solo. This is why most people do 2 or 3 employees and retreat back to being solo is because they never change their identity to become a teacher. And the reason they don't is because it requires humility to realize I don't have this skill and I'm going to do whatever it takes to learn this skill. And if that means raising prices while in the meantime, while I'm being patient, I'm trying to learn, I'm trying to grow my skills as a leader, I'm trying to figure out what my SOP is for training, I'm trying to figure out what my KPIs are to be able to make sure that my crew is doing a good job, I'm making sure I have pay for performance or a yellow slip system in place. While I'm doing those things and trying to become a better teacher that governs by metrics, KPIs, and systems instead of me doing the work next to them, I'm gonna raise my prices to afford myself the opportunity to get this education. And that education comes in the form of hiring someone, training them up correctly, figure out what didn't work 'cause they left. Why did we have yellow slips? Okay, should we cut those services? Should I create better training for those services? Should I create better KPIs? Should I implement pay for performance? These are all things we can do to become a better teacher. And most people will not do them 'cause they are hard. And we either deal with the fact that it is hard to gain these skills or we will deal with the hard reality that you will never grow the business. Which one do you want? And so that is the tough love I would give. And it is the exact thing that I would prescribe for anyone that's at $40,000, $50,000, $60,000 a month in revenue and they keep hitting their head up against it. Is we need to change our identity. And if you are buried in leads, which is a gift, raise your prices so you give yourself some cash room to make sense of the fact that you are not going to be doing the work anymore. And I have an honest conversation with my team and say, "Hey, look guys, physically I cannot do the work. And in the past, I have done that because I care about you guys. I care about this business. I care about the team, but it's killing me." And every time I get on those tools, is a bad thing for this business. Every time I get in those tools, I'm not gonna be able to create the space in this business, the size of this required to be able to allow you to move up inside the organization. I'm not gonna be able to grow. I'm not gonna be able to expand because I'm out here doing the work instead of teaching you all how to do it and becoming a better leader. And I'm trying to do that. And in your one-on-one meetings, that's how I focus on it. It's like, here's all the things, here's all the KPIs, here's how you're doing. Also, how can I as a leader become better? What can I do to support you better? I'm trying to move my identity from doing the work to helping you do the work. Because your whole why is to help others. Great. Teach other people how to be what you have done. You went from $3,000 a month in revenue to $40,000 a month. 'Cause you're really good at doing the work. The thing that takes you from $40,000 per month in revenue to $400,000 in monthly revenue is being able to teach and then lead other people. It just so happens, this is a really good thing, you want to help people and to do that, you will need to lead them well. And we will need to gain that skill and in the meantime, raise your prices to give yourself the financial leeway. All right. I appreciate everyone calling in for the confession booth. If you would like me to come out in person and do this, call this the Turnaround Show. There's a quick application, just takes a few minutes, but we fly around the country fixing struggling businesses. We've done dozens of different home services, and if you would like my help, it's completely free. Um, and I try to document it all to be able to help other people just like you that are struggling. So these are some of the videos we've gone to in the past year: lawn care, landscaping, fencing. We've done electrical, commercial, residential, a whole host of different services. So Feel free to scan the QR code down in the description. You can find the links to be able to apply. It takes like 5 minutes, and I would love to see you out in person, be able to document for the rest of the industry. I'm going to— I know the call queue is full, but I do have some meetings I need to get to. And so I just want to say thank you to everyone that called in, was so vulnerable. There are so many other people going through this. This is why we have the confession booth, is for you to realize you are not alone. And if you are struggling, if you're also like the caller today that was in the truck struggling mentally, breaking down, crying. You're not alone. And I want to make the confession booth as a way to show that, that this is not something that I am glad is part of the industry. I'm not trying to highlight it or admonish or elevate these low moments. I'm trying to show you that this happens to all of us. I have been in my truck and I just don't want to go out and do the estimate. I've been in my truck knowing we are 20, 40, 60, 80 hours behind schedule, that I have jobs that are going south, that I know I'm going to lose money on, that I know the whole weekend will just be spent doing paperwork and doing all the work that my crew didn't do well. And then I have 4 yellow slips and callbacks and customers are mad at me. I just got a bad online review. All of that piling up is what causes The mental breakdown. And so, if this show does anything, I hope it normalizes the fact that there are going to be low, low moments in your entrepreneurial journey. You will get through them. In those moments, the only way to quit, the only way to fail is to quit. And so avoiding quitting is the only thing I focus on. That's why I'm like, scale back, make profit, cut things out, stop projects, turn away new estimates, raise prices. That is all in the effort of ensuring you don't quit. So I love you all. I hope you all have a fantastic rest of your day. We will do the call-in show next week or the week after next week. We have Turnaround Show coming out next week. We have one, maybe two more spots in the entire year for the Turnaround Show. If you're considering it, I highly recommend applying. I'd love to see you in person. But until then,