From $10M to $50M: Strategy and Clarity Behind Timberline One’s Growth | Ep 187

Want to grow your business? Download your free roadmap today: coltivar.com/growth 

Learn more about Timberline One: timberlineone.com 

Most landscape companies stall out at a few million in revenue. Timberline One didn’t. 

In less than a decade, they scaled from $10 million to $50 million, and they’re still growing. Steve talks with CEO Judd and Chief of Staff Stephanie about the choices, discipline, and clarity that fueled their rise. From messy beginnings to bold acquisitions, from aligning strategy with financial reality to keeping people engaged through rapid change, their story shows what it really takes to break through growth ceilings without losing control. 

_______________________________________

Disclaimer:
The views expressed here are those of the individual Coltivar Group, LLC (“Coltivar”) personnel quoted and are not the views of Coltivar or its affiliates. Certain information contained in here has been obtained from third-party sources. While taken from sources believed to be reliable, Coltivar has not independently verified such information and makes no representations about the enduring accuracy of the information or its appropriateness for a given situation.

This content is provided for informational purposes only, and should not be relied upon as legal, business, investment, or tax advice. You should consult your own advisers as to those matters. References to any securities or digital assets are for illustrative purposes only, and do not constitute an investment recommendation or offer to provide investment advisory services. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendations. The Company is not affiliated with, nor does it receive compensation from, any specific security. Please see https://www.coltivar.com/privacy-policy-and-terms-of-use for additional important information. 

LinkedIn | YouTube

coltivar.com

Transcript

When you first approach people and say, okay, we're going to make a strategic plan, we're going to execute on it. A lot of it can feel really overwhelming. Take it one step at a time, simplify it for people.

That has really helped our team to understand what the goals are as we figure out that bigger picture. Today I have two really important guests on the show and they are responsible for taking a company from $10 million in revenue to over $50 million in revenue in just eight years. I have Judd, he's the CEO of Timberline One and I have Stephanie and she's the chief of staff.

And my question to you that I want to kick things off with is a lot of companies stay stuck, especially in the landscape industry and they hover around, you know, one to maybe $3 million in revenue. What's allowed you to grow your business so rapidly where so many people, they don't grow like that and they just stay small businesses?

Steve, I think we're in a constant state of change here at Timberline. Nothing stays stagnant. If you don't like change, we're probably not the place to work at. So I think that's one of the things that's always helped us is we're always looking for what can we do to improve the lives of our employees? What can we do to expand our services? What can we do to really make it to our clients that call us for anything that they have going on outdoors? That's, I think, one of the biggest things that's made a difference for us.

And you really came from humble beginnings. In 1982, the company started out as tiny, right? You're just doing these small little jobs trying to survive just the economic condition of the 80s. And then over time, you were able to, you know, grow it to this $10 million mark and then accelerate really quickly.

But let's talk about the early days in business. What was it like? And what did that look like for Timberline? Did you guys already, like, always have your stuff together with systems and processes and just the way that you sold projects? Or was it kind of messy at first?

Yeah, no, we were a hot mess. We didn't have a lot of organization to begin with. It was a lot of estimates were done with using your thumb as a gauge and throwing a number out there and going and working and trying it. I started with the company in the early 90s and there was only four of us out there. So, you know, our owner, Tim, he was the one that was wearing all the different hats at the time and we were just field staff helping him out.

But it was a hot mess until we started to get organized and get bigger and Tim had a vision of hitting a million dollars. He said, you know, hey, we hit a million dollars. We're going to take you guys to Mexico for a week. All expenses paid and that for us, that was the catalyst to make us work harder and get to that point.

Once we did, then we started to notice we had to have systems in place. We had to have some structured estimating, structured office setup, structured people in their positions. Whereas before we all just kind of ran and did what we needed to do when it needed to be done.

And you've been in the industry for a long time, Judd, and you and I served on the ALCC's board. And so we've seen a lot of landscape companies come and go. You've also acquired a lot of smaller companies and wrapped them into the Timberline portfolio.

So I guess my question, it goes back to what I was asking before. Why do so many landscape companies stay small? Why do they stay stuck in your opinion?

I think they're scared to, they're scared to see what's on the other side, so to speak. You know, as a landscape company, you get to a certain point and you have to be willing to take that risk and that step to get over the hump to the next level. And that next level comes with a lot more responsibility and you have to, as the owner, the owner has to back out of wearing all the different hats. The owner has to be able to trust somebody or trust a group of people and spread the responsibilities out.

I think that's one of the biggest things is owners don't know how to do that or they're scared to do that. And they're scared to let go of what they have.

And then with strategy, let's talk about strategy and growing the business because I'm sure early on before you had Stephanie in this role, maybe strategy was a little bit more like haphazardly done. I mean, because I always say every company has a strategy, even companies that say they don't have a formal strategy, they're following some type of strategy, right?

So how did you guys decide to make that transition to thinking we need to have some type of approach or some type of process and then we need to put somebody in the position to really grow this thing?

Yeah, I think that's a pretty easy one to explain. The strategy behind all that was really year-round work to keep the employees that Timberline has and expand from there. Tim knew we needed to grow, knew he needed to give up some stuff and have us taking on some more responsibilities.

But you have to find out, you have to extend beyond your normal service offering to keep year-round business going. Whether it's, you know, we're in a snow removal now, we're into Christmas decor, you could be doing hard scapes in the wintertime, retaining walls, stuff like that.

So I think that was one of the things for us was just that the strategy came with trying to figure out how do we keep people going year-round without having to lay anybody off? And from there, you know, you start to think about it, it's pretty simple stuff. It's like, okay, okay, well, we're gonna keep people going year-round.

We need to have somebody who's looking out and estimating jobs and going and trying to find the work. We have to have somebody who can go manage the people and make sure that they're staying busy and productive and doing work efficiently. You have to have somebody who's managing the books and overseeing all the costs associated with doing business.

So I think those things kind of start to fall into place naturally as we decided we need to expand our service offerings and what we could do on a year-round basis.

Yeah, I love that and I agree. And with Stephanie, I mean, you're one of the most brilliant people when it comes to marketing, sales, branding, just positioning the company. And prior to moving into this chief of strategy role, you know, you played a big part of making sure that that story was told with Timberline through the photos, through just like the branding, the marketing, making everything consistent.

So I guess my question is like, how did that help you as you stepped into more of a strategic type role? And do you think somebody in a strategy type position needs to have that type of vision, that type of mindset, those types of skills to be successful?

I certainly think it doesn't hurt, but I don't think you necessarily need to have a marketing, branding background to successfully step into strategy roles. I think it was just as important that I spent time learning the landscape industry. And when I first started at Timberline, I was assisting our owner, Tim, with running a lot of the administration of our maintenance unit at the time.

So getting to take a peek into how are things operating and grow that understanding along with the marketing background that I had, kind of coupling those things together. And from what I've seen, we've spent a lot of time with our team teaching them that anyone can think strategically.

We all are able to think about how we can innovate and take next steps. And you just have to start to kind of get that understanding of what's the real difference between strategy and operations and the direction that we're going.

Certainly doesn't hurt to have a marketing background. I do think that that's helped us to a great extent. But I think also consultants over the years, your previous question about how Timberline managed strategy before, they worked with a lot of consultants before I arrived at the company. A lot of really brilliant people over the years.

And I think we've been great at choosing, selecting items from each of those people to be able to bring together now a plan to not just have kind of that strategic plan in place, but put action behind it.

Yeah, absolutely. Like piecing that together. And you bring up a really good point. I think having that experience like behind the scenes, learning the business, coupling that together with like, okay, how do we expand through marketing sales? Like how do we grow the business strategically? Like bringing all that together is really critical because I think a lot of people enter in the workforce, right, whatever job it is.

And they immediately think like, hey, I want to be a manager because I don't want to be out in the field. I don't want to do anything. I want to get my hands dirty, essentially, metaphorically speaking. But I think there's true value in people working their way up through the ranks.

So you learn the context behind the field, right? Because you can stand in front of a group and say, hey, our strategy is to do this and this and that. But if you understand the nuances, then when it comes to execution, it's really hard to roll a strategy out.

Because like if I was talking and said, hey, yeah, we're gonna double the size of our maintenance division. And you said, okay, well, what about enhancements, Steve? And I said, well, what are enhancements? And you're like, well, those are the add-ons on top of the basic maintenance contract. And I was like, oh, well, tell me more how that works.

Then all of a sudden, it's like you lose trust. The execution doesn't work. Then it gets all sloppy. So I think having that background knowledge has probably been really beneficial for you. And it's probably a really good thing to teach all generations, not just the young generation, but like, hey, you have to think strategically. You have to have experience and know how all parts of the business work and come together.

Mm-hmm, absolutely.

So what about like when it comes to strategy and talking to field operations? Because I know some people are like, ah, strategy, you know, it's just a bunch of garbage. You know, it's just get work, do work, get work, do work. It's as simple as that.

Have you run into any challenges with that, trying to bring kind of an academic framework to business to create like an approach that goes beyond just, hey, go out there and just like start building things?

I think it definitely takes time and you have to chip away at it and be willing to not give up. I feel like it took us to about the three-year mark of me in this position for everybody to realize that it was something we were going to continue.

It wasn't going to stop, that we were going to keep pushing forward, that we were going to continue to involve more and more people in the process. So I would say don't give up, be ready to stick in for the long haul.

When you first approach people and say, okay, we're going to make a strategic plan, we're going to execute on it, we have to figure out what our competitive advantages are, a lot of it can feel really overwhelming.

So as we have new people join the company who will be involved in strategic planning and execution, they spend a good couple hours with me just going through what does strategy mean to us and how do we break it into baby pieces and really take it kind of one step at a time, simplify it for people.

But we'll also commonly do short strategic exercises that help everybody to wrap their head around it. So it's as simple as doing a SWOT analysis, talking about the forces that affect our strategy and breaking those down into pieces.

Last year, we did one with three little pigs, what are your sticks, stone and straw, those things that you need to work on, what's going well, what's not. And doing those little exercises has really helped our team to understand what the goals are as we figure out that bigger picture.

I love that, that's great. So let me ask you this, Judd, as the CEO of the company, I know communicating strategy and just communicating direction, like the overall vision of the company can be so repetitive at times, but it's so necessary.

And what I mean by that is when I was a CFO, I remember rolling out the strategy to our company. We had three different offices and literally as I PowerPoint up on the screen, I'm talking, got people in person and I'm like, this is our strategic problem, here are our initiatives, these are our actions, this is what we're gonna be focusing on for the next 30, 90, 120 days.

And then I left and then I went to one of our offices just a few days later and I remember catching somebody in the elevator and I was like, hey, so what are our initiatives? And they said like totally random things. I'm like, oh my gosh, we just talked about this the other day.

So that's when I realized, you just have to like say it over and over and over again to make it stick. But what's been your experience trying to keep everybody aligned and moving in the same direction?

Yeah, I mean, you're right. It's you're constantly repeating yourself. You feel like you're a broken record sometimes, but at the same time, you're looking at it from different angles or approaching it from different angles with people.

We can talk about strategy and it might go right over one person's head, but when you start to bring in maybe the financial side of strategy and the results of what strategy does, they can see that and it can make a difference for them.

So hitting them from a different angle that might be more in line with how their thinking goes, I think is a big thing we try and do here. We're not always just talking from a strategy perspective. It's how does that strategy affect the different ends of the business and how does it affect you and your position or the person next to you who's in a different position?

So you can start to see that strategy means different things to different people depending on where they are and what they've got going on in the company and we can relate it in different ways.

Yeah, and I like that. I like making it relevant to the frontline worker all the way to the top. I think that's critical.

You touched on something that I want to dive deeper into, which is the financial side of strategy because I think a lot of companies, they have these retreats, they have these strategy plans that they put together and it doesn't tie back to the financial side of the business. And I think that's where a lot of companies, they just spin in circles.

I remember coming into the office back in the day when you guys were doing $10 million a year in revenue, you're in a much smaller location and I remember the financial side of the business is good. Like it was a lot better than most companies out there but you didn't have that same visibility that you have today. And I know you have a good CFO in place and a good finance team but how important is financial clarity as you've grown really rapidly over the years?

Yeah, financial clarity is extremely important. And that's one thing Tim has always done a good job of, is being transparent and pushing transparency. We look at our financials on a monthly basis. We look at it from each individual company, each individual business unit within those companies. So we really start to break it down and we've got KPIs that we're looking at.

We're looking at the balance sheets, the income statements. We're trying to remember the song that you taught us about the balance sheet. But those are things that we have to look at on a constant basis and people have to understand where they have an impact on it.

Are they out in the field? Are they part of the cost of goods sold? Are they in the overhead? And how do they impact it at the overhead level? I think when you came in to us, a lot of times you were looking at the top line. Oh, what's our top line growth every year? And that's good. And that's something that we always want to achieve towards but we now look at top line.

We look at gross margin. We look at the bottom line. Those are all important factors that have true bearing on whether we're successful or not.

So it's just more than the top line now. Everybody takes initiative on their business units. They're responsible too.

We spread the wealth as to who's responsible for the success of their business units and putting their budgets together and the financial results. Everybody plays a role in that.

Yeah, and you've diversified the business quite a bit. You have a bunch of different profit centers in the company like you alluded to earlier. So my question is when you're looking at financials and let's say you just have a dog, right? And you don't have to get into details and specifics but I know every company has a profit center that's not performing well. It's perhaps losing money.

That was me as a CFO. We had a couple of dogs and we constantly had these discussions like, do we kill it? Do we kill this profit center? Do we divest it? Do we try to sell it? Do we just like, do we pivot it? What do we do? How do you look at that when you have a company within the company or a profit center that's underperforming?

Well, I guess on the top of my head is that's the reason we diversified is because not every section of the business, not every profit center is going to be profitable depending on all the external factors, you know, the economy, the weather in our industry plays a huge factor in things. So part of our diversification was knowing that some business units were going to have good years, some business units weren't going to have good years.

By season, we're going to have some business units are going to do great in the wintertime versus summertime. So the other portion with that is when we see a business unit that's struggling, we can rally the troops around that though. And we can feed off of the successes and what other business units are doing that are successful and try and take some of those traits and migrate those into that business unit that may be struggling a little bit.

Yeah, that makes sense. And what about you, Stephanie? Like when it comes to trying to cast this vision of the strategy and making sure everybody's aligned with the strategy and then the financial results, how do you think about these two playing together?

Oh, it's incredibly important. I spend a good amount of time talking with our CFO and making sure that the KPIs that he's measuring are in alignment with what we're measuring for our strategic goals as well. A lot of them really mirror each other or piggyback off each other. I might be breaking things down a little bit smaller than he does, but they tie hand in hand.

And when it comes to communicating things out, as Judd said, it's that repetition. We meet with every business unit or profit center every month to ensure that their strategic plan is still going the direction that it needs to, that they're making good progress towards those goals. And over the last two years, we've also started doing grit training with our entire workforce.

It's a once a month training about how their attitude, performance, how making little changes can make a difference. It's reminding them what our vision is. Sometimes people get hung up on mission, vision, values. Like it's so much when you're dealing with six companies at this point, it's not seven.

Anytime I can simplify it and take it back to our core values really helps people to look at just kind of those little simple pieces that they can latch on to.

Yeah, that's super helpful. So let me ask you this, as you guys grew from $10 million in revenue to 50, were there some things like along the line where you're like, wow, we really had to navigate this to not get killed in the process.

So in other words, if you're giving somebody advice, say I'm at $10 million a year in revenue and I'm like, I want to grow to 50. What would you say to me to like look out for, or like big lessons that you learned along the way?

I would say acquisitions have been a great part of how we've grown. And some of them were more successful than others. We definitely learned a lot through each one. They were all each a little bit different as well. Some of them were smaller companies and smaller customer lists that we were purchasing and taking over.

Our most recent one was quite large where we were really taking two teams and bringing them together. It was our first acquisition at an offsite location that we were going to keep. So now we have teams working in two separate spots.

I think you have to make sure that if you're considering that, that you're really not only vetting out, is this going to be financially successful, but are these a good cultural fit for our companies to kind of come together and continue to work together into the future?

Aside from that acquisition piece, I would say we've definitely grown quickly. And you have to make sure that you're just always keeping a pulse on our things moving too quickly. Where do we need to potentially slow our role a little bit to make sure we're not overwhelming people and keeping an eye on that customer base the entire time?

Whether you're growing organically or via acquisition, keeping them at the front of your mind. Your team, your customers, taking care of people and ensuring that you're retaining those teammates and that customer base at the same time for it to be successful.

Do you ever look back and think, ah, the good old days when we were smaller in the smaller office, I wish we could go back. Or do you feel like, sure, there may be some more problems, more headache with the scale, but you're glad that you did grow the company like this?

I think we're having fun. We can go back. I think we've got too much momentum. We've created a lot of momentum where the forward thrust is what we thrive on versus looking back and saying, oh, it was nice back then.

Yeah, we had a great time back when we were small. There's no doubt about it. But I think we're having a better time now.

Yeah, that makes sense. I would still like to go to Mexico. When you get to the $100 million mark, Stephanie, you'll get half your trip paid for.

No, that's great. Okay, let me ask you this. What is the number one problem you're dealing with from a global perspective in your business? And how has that shifted from the number one problem that you're dealing with when you were smaller at 10 million? Or is it the same stuff?

From my perspective, the number one problem is always going to be people. Finding the right people to sit on the bus at the right time in the right location. We had that problem back when we were a $10 million company. We have that problem now.

It's still a problem. It's going to be one of our highest things we're always looking out for. But at the same time, we've learned through our grit and tenacity that even when we don't have the right people or in place or the bus isn't going the right direction that we can rein it back in and we can figure it out.

2020 COVID taught us a lot about ourselves and what to do when things don't go right with personnel. And I think that's helped us out. But I think that's always going to be our issue because our industry, our profit centers are all driven around people.

AI doesn't help us a lot. Autonomous equipment helps a little bit but not a ton just yet. So we're still very, very human driven.

Is it easier to attract better talent with your size compared to when you're a smaller?

I think so. I think size will definitely have an impact on that. Steve, I think it's reputation. I think we built up a good reputation within our city, within our state and within our industry around the nation where people know us. They know who we are and they know what kind of operation we run. And I think that's helped tremendously in our recruiting.

So we live in this world where the cost of developing has actually dropped significantly. In other words, with technology, for example, like if I wanted to create a software platform, pretty easy for me to do. If I wanted to copy Facebook, I can probably do some low code website, make it look like Facebook.

But the real cost is in attracting the audience, the attention, the leads. So if somebody's listening to this and they're like, yeah, that's great. I'm at 10 million, but I do want to grow too.

But I'm just having a really hard time doing that organically, getting the leads, getting the business. What advice would you give to them if they're just struggling to grow their business that way?

I would say consider looking outside of your company, look for good quality consultants and find somebody that's going to be open and honest with you. When they come and take a peek behind the curtain, they're not going to sugar coat things. They're really going to help you look for those important things to get to the next step.

I think practicing essentialism is incredibly important at any size, but especially when you're smaller and potentially wearing more hats and carrying out more job duties, making sure that you're doing the most impactful thing every day. And sometimes that's hard to figure out what it is and you need somebody else to come in and take a look to help you find that direction.

And if you can't swing doing something with a consultant, most of them have really excellent books and content out there available to soak in and learn that way.

Yeah, that's a good starting point. Yeah, I like that.

Okay, so final question for both of you. In this world where there's so many distractions, so many shining objects, right? And I know AI hasn't like hit your industry like other industries, but still there's a lot of things where it's like, okay, you could do this acquisition. You can start this business. Oh, we should start self-performing this. Let's get into construction. I mean, there's so many different things you could do, right?

And I'm going to ask you, it's the same question for both of you. How do you stay focused on the most important things? Stephanie, you just alluded to essentialism. So I'm going to have you start first, but how do you avoid the trap of the new shiny object and going down that path, whether it's a new framework, a new approach, or I read this book, so let's try this. Just creating a lot of distraction and noise in your business.

It's hard because at the same time, while we want to be essential, you do have to evaluate some of those new shiny things because some of them can make an incredible difference for your company. I think you have to look at splitting that load a little bit and having teammates that are looking forward and evaluating those shiny things, teammates that are living in the present and making sure that you're operating efficiently, people that are looking backwards and reviewing your numbers and seeing where we've missed versus where we've won, what we need to adjust. So keeping people kind of in all of those seats.

I think you have to be ruthless with your to-do list and that's something that helps to sit and evaluate with someone else. I meet with Judd every couple of weeks, sit down. We look at what I have going, what we have going strategically for the whole company, and we're evaluating together what is the most important thing.

What have we potentially thought was important that we've started working on and we've realized that things have changed in the last couple of weeks. That's no longer the most important thing. You have to really look at and vet those things out together.

I think we're always going back to just asking ourselves, does this align with our vision for the company? If not, let it go. Does this matter to our customers? If not, let it go.

Love it. Judd, what's your take on it?

Very close, very similar intake. Our C-suite I think has made the difference. You helped us create a C-suite years ago and we've got some really great people on that team that we don't all think alike. We have very different thoughts on things and we've been able to create consistent meetings every bi-weekly before we get together. We'll talk strategy. We'll talk about the new shiny objects, whatever it might bring up.

During those meetings, you get a lot of level-headed thinking from others about, oh yeah, well, have you thought about this or looked at that? I think that's been a tremendous help for us.

I've noticed in my role itself, Steve, I feel like there's so much I'm just, I'm an evaluator a lot of the times. I'm always just thinking and looking at, okay, does this structure of people work? Does this equipment still work for us? What about this business line? Can we add on this other business line?

We talk with other people out there, other businesses, and you're always thinking about how another business or offering equipment, people, whatever it is, how do they affect what we're doing as a company where can those pieces fit best together as you move forward?

Yep, absolutely.

Well, this has been an incredible conversation. Be sure to check the show notes down below. We'll have a link to Timberline One. You definitely want to check out their company. They do such an incredible job.

Congratulations on all your success over the years.

Thanks, Steve.

You touched on something. Hold on one second.

Pen. Cut that. Okay, here we go again.

And action.