Building a Seven-Figure Home Service Company with Digital Marketing Expert Phil Risher

There's a saying that up until $1 million, the once you hit a million dollars, the hustler has to die and the leader has to be born. And for me, when I hit a million dollars, I was pretty much, you know, the number one salesperson. I was the ops person. I was doing a lot of these roles in the business, but it was capping the potential for growth. And it's very risky or scary for a lot of people because imagine you're doing a million dollars and your profit is $200,000, 20%. Now you have to take that 20% profit and hire a bunch of people for 80, 100, $150,000 and the profit's gone poof. And hopefully this helps you grow your business. That was the biggest thing for me was getting over that hump so that way I could build out a team. And once I build out the team, my business doubled. And once I doubled, now I have the revenue coming in. So if the person's not the right person, at least I have the position and the allocated funds to bring someone else in. That would be the right fit for me. That was a big game changer. I would.

If you're a real estate investor and are wondering how to raise and leverage private money to make more profit on every deal, then you're in the right place. On raising private money. We'll speak with new and seasoned investors to dissect their deals and extract the best tips and strategies to help you get the money. Because the money comes first. Now, here's your host, Jay Connor.

Have you ever noticed how some businesses just print money while others can't stay busy for more than a week at a time? And here's the crazy part. Most of the time, it's not the product, it's not the people, it's the pipeline, it's the visibility, the conversions. It's the follow up. Well, today's guest has mastered all three. Let me ask you a question. What if you could take a small home service company, say H Vac Plumbing, duct cleaning, and make it so booked, so busy, so dialed in, so profitable that it becomes a seven figure asset someone would gladly pay five to ten times earnings for? Well, that's exactly what Phil Risher does. You see, Phil is the founder of Flash Consulting. He went from paying off $30,000 in student loans and stacking and saving up $60,000 by the time he was 25 years old to leaving Enterprise, Rent a Car, helping a local duck cleaning company triple their profit, and building a digital marketing firm that now drives millions in revenue for clients all across North America. Well, he's been featured in Forbes, cnbc, Business Insider, Yahoo Finance, and he is here on the show today to break down the exact systems behind scaling, selling and staying fully booked all the time. We're talking how to actually convert website leads into paying customers, the three growth levers every business has to pull, and the strategies home service companies are using right now to dominate their markets. So buckle up, because if you want to understand how real businesses scale, operate and exist and exit at massive multiples, Phil is the guy to listen to here on this show. Well, welcome to Raising Private Money, the only podcast for real estate investors who want to fund their deals without relying on banks, credit or using their own cash. I'm Jay Connor, the Private Money Authority, and I show you how to get private lenders begging to fund your next deal. Because every good deal starts with the money. You're going to meet Phil, my special guest, right after this. Phil, welcome to the show.

Yeah, Jay, thanks so much for having me. I'm really excited to talk about.

Yes, I'm excited to have you on. Well, you have helped and consulted with many, many businesses. One of which is an example. You've helped a duct cleaning company triple its profits before you even launched your consulting company, Flash. So my question is, what were the exact levers you pulled that made that kind of jump happen so fast for the duct cleaning company?

Yeah, I had to figure that out myself. And what ended up happening was I worked there for a year and they went from 3 million to $4 million in revenue, 300,000 in profit to 900,000 in profit. And we sat. He was getting pursued by private equity companies to purchase the company. And we went to lunch. Me, the owner and then search fund got guy who was trying to buy the company. And we went to lunch and he asked me three main questions and these are the three things that we did. First, he asked me, how do you get new customers coming in the door? Second, how do you convert the leads into actual customers? And then third, how do you retarget your past prospects and customers to bring them back into the funnel? So those are the three things that we did for that business. And after that we had another company, 3 million to 8 million and then sold to private equity. And now that's what we do for home service businesses all across the country.

Wow. Amazing. So the exact levers that you pulled and you helped increase again was the leads.

Lead conversion and then retargeting. So taking their past prospects and customers and Getting the most juice out of the squeeze. You can't get lifetime value without a lifetime relationship. So how do you continue getting that lifetime value? That's the third part.

So what's some advice that you can give on how do you establish that relationship and create and transform that relationship into a lifetime relationship?

Yeah, for sure. So out of those three levers, the retargeting one is very important. And when we talk, we work with private equity companies and we work with normal mom and pop owners. The number one value in a business is the number of customers you have in your database. And if you have memberships, great. But the customers in your database, because they already know, like and trust you. So what we recommend is two things. One, you need to be sending out an email newsletter every single month. And we have this playbook, it's called a two step revenue email playbook. So you send out an email newsletter based off of a content calendar. So if you're an H Vac, for example, in the spring, you would say, now is the time to get your spring tune up. Then after that first email goes out, anyone that opened that email, you want to send them a second email that says, we're going to be in your area. This is the two step revenue system. You don't just send out one email and then see what comes in. You send them a second email that says, hey, we're going to be in your area and do you want us to come by and do this? The second way to get retargeting coming in is through text message marketing. Text Message marketing gets 95% open rates, which is why you want to text your customers different offers throughout the year. Obviously don't be annoying, but like once or twice a year with some type of an offer to bring people back in. We had an H Vac contractor, they were $1.5 million business. In the first year, we sent out 12 emails, one every single month. And they generated $257,000 in additional revenue just by sending out those emails. This is one of the honey holes for most businesses that everyone misses out on.

Wow. Do you help your clients actually like create or write those emails?

Yep. So we're actually a done for you model. So we get bolted onto businesses. So what we found is that specifically between 1 million and $10 million home service business, they can't fully hire a chief marketing officer, they can't hire a copywriter. They can usually hire like a marketing person for like 50, $60,000, but they don't really know what they're doing. So what we do is we have, we have 18 people on the team, three consultants and then a back end pod team. We get bolted into their business and we execute all these things as experts inside of their business. So ours is completely done for you and it's a win win for everyone.

Wow, that's amazing. So you focus on consulting with home service businesses. H vac, plumbing, electrical. What would you say are some of the biggest marketing mistakes that you see that keep these businesses from staying fully booked and really maximizing revenue?

Yeah, there's two big ones. The first one is that they're spending money on ads, but they don't know the return on ad spend. So they're just praying to the Google gods that they send them leads and just giving money to them and they don't know if it's actually turning into revenue. So at my home service business when I was working there, we were spending about $10,000 a month on ads. Yelp, Google search ads, Google local service ads, Angie. And we didn't know if that ten thousand dollars was turning into a hundred thousand dollars or zero dollars. And most home service businesses just fly blind and just go off gut feeling. They don't have all the data dialed all the way through. And unfortunately most marketing companies don't go into their CRM and pull out the data. So everyone's just kind of flying blind with numbers, but they don't have the full scope. So the first thing is a big mistake is you're spending money on ads but you don't know if it's actually working. The second thing is not focusing on that conversion funnel, which is the second pillar that I mentioned at my home service business. We would get a lot of leads coming in, you know, 800 some leads every single month. But we weren't tracking our booking rate. So we didn't know that we got 800 leads and we booked 60 jobs or whatever it was, or 600 jobs. And we didn't know if we sent out this many estimates how many you actually closed. So what we usually recommend doing is setting up a lead nurture sequence and an estimate nurture sequence to nurture your leads to help convert more jobs. One company, we set up a lead nurture sequence for a lead comes in and then they have texts and emails that goes out to get people to book. They went from a 41% booking rate to a 62% booking rate just by setting up a lead nurture sequence. So those are the big two mistakes that we see a lot of times.

That makes sense well, most business owners, I believe, think they have a lead problem. But really what I've observed, I think you will agree based on what you've said so far, they really have a follow up problem or don't actually even have a follow up strategy or process in place. So what are some more of the ways or the right ways to convert website leads into paying customers? You talked about retargeting, the emailing, the texting. What are some other ways to convert those website leads?

Yeah, I'll give you the secret sauce. So first, most companies don't have a lead problem, they have a lead management problem. They get leads that come in and they're one and done companies. One night stands, basically, they get one call, one shot at it and then it's gone forever. So here's how we help businesses and if you're listening to this, this is what you should do. When someone goes to your website and fills out a form to work with you, you need to text them and email them right away. Because when you call them at 10am on Monday morning and they don't answer the leads, poof, gone forever. And you just paid money for this. When you text them and email them right away, you can ask for a picture. So you text them and say, hey, we'd love to start working on your gutter cleaning or your duct cleaning or get you scheduled for an H vac repair. Can you send over a picture to let us know what's going on? This instantly moves the ball forward for people and it moves you closer to working with them. So that's the first thing is get the text and the email set up right away. Then this was a big issue that I faced is my company did duct cleaning and a lot of times it was just price shopping. So how much does it cost to do this? Our customer service representatives would get one shot at articulating the price and then the lead was gone forever. So if you experience this, what you should be doing is having a lead nurture sequence. So that way when you talk to someone and they say, how much does it cost? And you say, hey, I'll be happy to give you the price. We also put together a complete pricing guide. I can email that over to you. What's the best email to send it to before I give you the price? Then you get their email information and you send them an email. And now you can set up an email nurture sequence to be following up with them. It sounds basic for people that do like online businesses, but in the home service space it's pretty foreign because it's so like call something, schedule it, book it. It's not as much of a nurture sequence. This alone, if you fix this in your business, can generate millions of dollars because you don't even have to spend any more on ads. All you have to do is just tighten up the bucket. So if you're putting water into a bucket and you have holes all over the place, fill the holes before you put more water in and you're going to get more return.

Well, that's just so smart when it comes to marketing is getting the contact information so you can start to build that relationship.

Exactly.

And you know, since I am a coach consultant to real estate investors, it's easy for us to think, well, this is like, who wouldn't know this? But I understand what you're saying. In the home service business, I guess most of their experience and world of communication is just picking up the phone and calling people.

Exactly. It's much different. What I would say for real estate investors, any business in general, like my business too is you have different tiers of leads that come in. So a high value content offer or some type of a giveaway or some type of value or, or someone exchanges their email address for that information, that's going to be a much colder lead than someone just booking on your calendly link. And a lot of times in home service businesses they're just like, schedule now and just book my thing. But there's a little bit more song and dance that has to go into it and you have to work your way through this funnel of cold lead into automatic warm lead.

Exactly. And I love the idea you just shared a minute ago about immediately right after the lead coming in, they get a text, they get an email and you're asking that lead to do something. Take a picture, send us, text us back the picture of what you got going on. So now you actually have that lead taking action, getting engaged, and you're already training them to follow instructions and to do what you tell them to do, right?

Exactly. It's you're training them to do what you ask them to do. But also they're moving the ball down the field and giving you more ammunition. So that way when you go to clothes, you have pictures and all this stuff. I think regardless if you're home service or not, if you do not have a system in place to get the ball moving forward without a manual process, then you're hindering your growth because you need to. It's not even AI, it's Just automations inside of your process.

Yeah, that makes a lot of sense. So you have helped companies, you've consulted with companies to actually get them to a point to where their company is sellable. I'm thinking a lot of home service providers maybe don't even think about. They don't even think about them having a company that is sellable. Like this is what I do. I'm going to do it until I don't work anymore and then you know, the, the show is over. So you've helped, you've helped companies grow enough to like sell at 5-10x multiples?

Yep.

Of what the revenue is. So from a sales and marketing standpoint, what would you say a business needs in place for that business to actually become sellable at that level or at some time?

Yeah, for sure. So what we found is that between the 1 to 10 million dollar home service businesses, what we serve, there's three main sections, there's 1 to 3 million, 3 to 5 and 5 to 10. These are the main sections that people fall into. So in 1 to 3 million usually the owner is the number one salesperson. They can go out and sell any job. They're also probably like the lead tech or project manager that can go out and solve all the problems. This is a big bottleneck and it also gives you key man risk. So it's harder to sell your business if you're the number one salesperson. The three questions that the private equity company asked me when we went to lunch was how do you get customers coming in the door, how do you sell them and how do you retarget them? What they want to hear is that you have a system for each one of those. Not oh me, the owner has to go out and do X, Y and Z. It's here's our system and playbook for this, here's for this, here's for this. So the first thing is like if you're 1 to 3 million you got to buy back your time. And Dan Martell has a really good book on this called buy back your time and he has a five rung replacement ladder. First is admin. So you need to have a CSR customer service representative, admin office manager. Second, you need to have a delivery point person. So you need to have technicians out in the field and also some type of a project manager or operations manager. Third you, you need to have a marketing taken. This is where my company fits in. Marketing that's outsourced, that's not you the brainchild but someone executing marketing to Generate leads for the business. Fourth is sales. So you have to have a sales system in your business, usually around $3 million. This kind of caps out at the sales, and then fifth is management. And that's the system that you need to get you to like, 3 or 4 million. Now to go to like, 4 to 5 million, you have to have good data. And this is what I did in the business was I was able to take all the data and make the best decisions. So that way, when we sit down with private equity, they're like, what are you doing for this? And it's like, here's all the data we have, here's all the systems that we put in place, and here's what's working, here's what's not. Here's where you could probably come in and help fix these things. And the company that I worked at was doing 5 million top line, and EBITDA was around 1.5 million. And he sold for multiple more than 5x because we had all this data dialed in and all of these people in place for the business. So he could literally just step out, someone else step in, execute a little bit better, and refine the process, and then grow the business. So those would be the main things that I would see specifically in like, the one to $10 million range is having those parts fixed.

That makes a lot of sense. Now, your actual business, Flash consulting, your business has scaled to seven figures, serving clients all over North America. So from your perspective, your experience, what systems and processes did you put in place that allowed you to make that kind of big leap without everything falling apart?

Yeah, for sure. So there's a saying that up until $1 million, the. Once you hit a million dollars, the hustler has to die and the leader has to be born. And for me, when I hit a million dollars, I was pretty much, you know, the number one salesperson. I was the ops person. I was doing a lot of these roles in the business, but it was capping the potential for growth. And it's very risky or scary for a lot of people because imagine you're doing a million dollars and your profit is $200,000, 20%. Now you have to take that 20% profit and hire a bunch of people for 80, 100, $150,000, and the profit's gone poof. And hopefully this helps you grow your business. That was the biggest thing for me, was getting over that hump. So that way I could build out a team. And once I build out the team, my business doubled. And once I Doubled. Now I have the revenue coming in. So if the person's not the right person, at least I have the position and the allocated funds to bring someone else in. That would be the right fit for me. That was a big game changer, I would say. The other thing would be those three levers in my business, which is how do I get leads coming in? For me, it's a lot about content. And then the second part of the conversion is our sales process. So like we, we have a weekly email newsletter that goes out that gets 50% open rates because it's just tons of value. And then inside of our conversion process, what does our sales system look like? So it's basically like those three things inside of your business. It's a little different between B2B and B2C, B2B. But it all is the same principles. You get leads coming in, you convert them through a sales process, and then you keep retargeting them and bring them back into the funnel.

Excellent advice, Excellent advice. Now, let's, let's say, let's assume that you have a new client that comes on business owner, service company, and let's say their primary goal is to double their sales in the next 12 months. Given your experience working with all these clients, where would you tell them to focus first and why?

Yep, there's four numbers that they need to track. That's it. There's a million distractions, but there's only four numbers. First is your booking rate. Booking rate means you got this many leads and you converted them into this many jobs. And for any other business out there, you got this many leads and you converted them into this many sales opportunities. So a booking rate number two is your close rate. You did this many estimates and you closed this many. This many estimates, you close this many. Third, average ticket, your average ticket is $2,000 or your average transaction value is whatever. Fourth is customer acquisition cost. How much does it actually cost to get a customer? Those four numbers, that's all you have to focus on everything else. When you have the people in place. If you just focus on those numbers, you're going to grow your business. For example, your booking rate should be in home service. It's the average is 42%. The good people do 62%. So if you don't get any more leads, but you just increase your booking rate by 10%, you just increase everything else by 10%. Then if you increase your conversion rate by another 10%, you get more returns and you don't even get any more leads, then you Increase your average ticket from a thousand dollars to $2,000, you just doubled your, your revenue. So those four numbers will drive extreme growth if you focus on them. And what I recommend doing is every month, pick one of the four and every month is just how can I get my customer acquisition cost to be better? How can I get my average ticket up? How can I get my booking rate up? And it comes down to knowing those four numbers and then getting better and better every single month at those numbers.

So when you work with your clients, in what kind of way do you coach them on? Well, how, how do I, how do I increase my conversions? Right. You know, like I get my booking, but how do I, how do I increase the bookings, how do I increase the conversions? Do you work with them in detail on that?

Yeah, great question. This was my biggest heartburn was there's digital marketing companies floating out here, then there's your CRM data in here and then there's automations over here. And most companies want all three to be talking and working together. So what we do is we actually go into their CRM, their client relationship manager, like a HubSpot or whatever, but for home service businesses it's Service Titan, Jobber or Housecall Pro, the main ones. And we actually pull that data out every single month because as a marketing company we could get you a bunch of leads, but if you don't turn them into quotes or you get a bunch of quotes and you don't turn them into sales, well then we need to fix your sales process by either helping with automations, creating content, telling you don't spend any more on ads until you fix this thing, but it's all about growing the business, not just getting more leads coming into the funnel.

That makes a lot of sense as well. So I'm sure we got some small business owners here that are tuning into the show and some of them are feeling stuck. They like feel stuck. They got maybe decent revenue, but they really don't have any kind of growth going on. When you diagnose a company or a business owner, what's like the first diagnostic step you or your team does to figure out what's really truly holding them back?

Yeah. So if someone's feeling stuck, usually they feel like they're stuck with leads. So I'm just going to speak directly to that one is like, how do I get more leads for my business? And there's a million things that we could talk about or ask them questions on, but let's just focus on leads because probably that's what people want to hear. So what we recommend and I'll speak to home service and just general businesses like my business as well. Home service, 80% of people are going to Google and searching H Vac Repair near me. So if we know that 80% of people are going there, then we need to show up there in the four different areas. So that's what we do for home service businesses is first, are you in those four areas? And then how can we make sure that you're in those areas and grow your business? For general people listening to this, even if you're not a home service business owner, it's like, where do your target audience hang out? Are they on LinkedIn? Are they on YouTube? Are they on podcasts? Do they read books? I'm sure you're saying yes, yes, yes, yes. So naturally, you should do everything that you can to show up in those places effectively as much as possible so that way they can see you. So what does this mean? Creating content, more, better, different content in that order.

That is really good advice, Phil. So I tell you, Phil, you've got a really unique background. You paid off debt at a young age. That's like unheard of. Then you say you saved a lot of money, like very aggressively by the time you were 25 years old. And then you jumped from enterprise rental cards into entrepreneurship. My question is, how did that mindset shape the way you scale companies today, if at all?

It did, yeah, for sure. I think for me, a lot of it came with like, I'm a winner and my team's winners and I kept stacking wins. So when we work with businesses, a lot of times they're frustrated with marketing companies because they, they're just doing one thing and they feel like they don't have a winning game plan. It's more of like a, it's, it's just a win for the, for the marketing company because they're spending money and they're getting leads. But it's not a win, win, win situation because they're not actually looking at your data. They're just driving leads for you. So for me, when I look at situations like how can we stack more wins and get wins, wins, wins, that's the first part. The other part is more of a philosophical thing, is that personally, I'm very fortunate that I'm debt free. I can come and show up from an abundance mindset. I can show up to give and not need anything in return. Maybe something comes of it. But me and my team, we can show up and Give as much as possible. And I think that that's a unique way of doing business. I'm not just, I don't need to take, I can just give. And it's just something that's a core at my principles, like how can I show up from an abundance mindset and just give. And if it makes sense to work together, great. If not, hopefully I gave you the recipe and sell the cookie.

Well, Phil, you have dropped a lot of nuggets here in a short period of time. And I know we got business owners, service providers, actually any, any business owner that would be interested in reaching out to you, how can they get up with you?

Yeah. So if you're a home service business doing between 1 million and $10 million a year, we do marketing audits. We can hop on a call, show you all the stuff, show you the recipe. If it makes sense, work together, great. And you can go to flash consulting.com p h l a s h consulting.com and if you're like, hey Phil, you seem like a cool guy. I hang out on LinkedIn and Instagram. That's the two places that you can hang out with me. Yep. Phil richer on LinkedIn and phil richer on Instagram as well.

All right, that URL again is www.flash consulting.com spelled P H L A S H consulting.com and of course, all these links will be in the show notes as well. Bill, thank you so much for joining me here on Raising Private Money.

Yeah, thanks so much for having me. I appreciate you.

All right everybody, that's a wrap for today's episode. Huge shout out to Phil Richer for dropping absolute gold on how to scale, systemize and actually make your business worth something when it comes time to sell the business. So if you're a home service business owner or honestly, as we were just talking about any business owner and you're tired of guessing, tired of hoping that your phone is going to ring, tired of paying for marketing that really doesn't do anything or move the needle. Go back and re listen to this 30 minute episode. Phil has laid out the blueprint. Visibility, conversions and retargeting. That's the game that he knows inside and out. So if you want help executing it, check out what Phil and his team at Flash Consulting are doing. As you just heard, this is not theory. These are his exact strategies behind 7 figure companies with 5 to 10x exits. If you got value from this episode, share it with someone who needs to hear it. And as always, thank you for listening to Raising private money. Be sure to, like, share and subscribe. I'm Jay Connor, the private money authority, and I'll see you right here on the next episode of Raising Private Money.

Are you feeling inspired by the knowledge you gained in this episode? Then head over to jconnner.com moneyguide that's J C O N nner.com moneyguide and download your free guide that shares seven reasons why private money will skyrocket your real estate investing business. Right now. Again, that's jconnor.com moneyguide to get your free guide. We'll see you next time on Raising Private Money with Jay Connor.