We Bought A Franchise!

Aaron Harper’s Franchise Playbook: Why Niche Service Brands Beat Food in 2025

• Jack Johnson • Season 2 • Episode 19

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Looking for the real playbook behind franchise growth in a high-rate, AI-shaken market? We sat down with Aaron Harper—architect of Rolling Suds’ explosive rise—to unpack why niche, recurring service businesses are beating capital-heavy food brands and how honest expectations turn into better outcomes. From the Patch Boys turnaround during COVID to building the largest power washing brand by units nationwide, Aaron shares the decisions that mattered: targeting a service with commercial recurrence, claiming a category before an 800-pound gorilla forms, and funding support so franchisees can actually scale.

We get practical fast. Want to buy into an emerging brand? Ask about capitalization, headcount plans, field support ratios, and how much of your franchise fee funds support versus sales. 

Hear why “hire a GM and keep your day job” is usually fantasy, how W-2 versus 1099 labor shapes resale value, and why private equity favors operators with predictable, commercial contracts. 

We dig into fencing, roofing, and commercial cleaning as compelling categories, contrast execution advantage with first-mover advantage, and reveal the KPI mindset owners need to build real enterprise value.

There’s also a bridge for ETA searchers who’ve spent 12–18 months chasing unicorn acquisitions. High-quality franchises deliver speed to cash flow, proven systems, and full ownership without surrendering equity to a fund. The throughline is simple and strong: pick a focused niche, commit to active ownership early, and build recurring revenue that compounds. If you’re ready to stop hunting for “absentee” myths and start constructing a business worth buying—and one day, worth selling—this conversation lays out the path.

Enjoy the episode, then subscribe, share with a friend who’s exploring franchises, and leave a quick review so more builders can find this show.

Visit www.weboughtafranchise.com to subscribe.
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From your pals in franchise ownership, Jack and Jill Johnson.

SPEAKER_02:

Hi everyone, welcome back to the We Bought a Franchise podcast. I'm Jack Johnson. Joining us today, Aaron Harper, the CEO of Rolling Studs. We also have Catherine Allen, MVP of Soccer Stars franchise and one of our great franchise consultants. Brian Gross, who was the top performer of his system last year and also has a successful exit. And we also have David San Juan. David is number five in his pink Windows system. David continues to add units and do all kinds of crazy things in the entrepreneurial world. I think you guys are going to really enjoy this session today. Listen, there is no one better in the world of franchising at bringing the brutal truth of what business ownership is, the highs and lows, than Aaron Harper. So, Aaron, welcome to the show. Thanks for having me on. I'm really excited for this format. Yeah, Aaron, so you know, for you, you've had kind of a wild ride in franchising. I feel like we've worked together for a long time, starting back in maybe 2017. Um maybe, maybe share, if you wouldn't mind, a little bit about your journey and what brought you to Rolling Suds.

SPEAKER_04:

Sure. Um, so I've been in franchising um for a long time, uh, working predominantly on home or commercial service franchises. And specifically growing those commercial or home service franchises to become the largest brand in the world in that specific industry. So first it was carpet and floor cleaning, um, then it was uh drywall repair, um, and now uh decided to venture out on my own to become an entrepreneur and acquired a 35-year-old power washing brand that was non-franchised and turned it into um a franchise. And um, you know, it's it's we've now grown from a single-location power washing business in 2023 um to 326 units operating in 35 states across the country, um, becoming by by a wide margin the largest power washing brand in the world. And doing that through finding great franchise owners that believe in our mission um and building a team um that can uh build truly like a world crap world-class national organization that um you know predominantly does commercial power washing, but obviously we still do residential as well. Um and uh and then recently stepped into a chairman of the board position by hiring a professional CEO to run my company.

SPEAKER_02:

Aaron, that's an incredible story. But knowing you, I'm not at all surprised. Anywhere Aaron goes, franchises, I mean, let's be real. Aaron before Rolling Suds, and Rolling Suds is a great franchise, and and the the whole premise with the bigger trucks, doing the bigger jobs, getting in and out of jobs faster, um is excellent. Um, and it's it's a huge differentiation. But prior to that, Aaron was with a franchise called Patch Boys. Aaron, can we talk about this for a second? Yeah.

SPEAKER_04:

So Patch Boys was a wild ride too. Um, so that was uh that was bought by the company I was working for. Uh it was a 98-unit system. And when they bought it, there was one part-time employee that came with the acquisition. That was it. And they're like, here you go, Aaron, grow this thing. And I was like, Whoa, hold on. Let me figure out what's going on here. So I did a listening tour and identified that the franchisees needed a lot of help, and we needed to build something that actually was a system that was sustainable and able to be sold to prospective franchise owners, meaning that they could buy something that was a predictable ability to make money, and that's what a franchise should be, right? And um, and so we did this by going out and listening to our franchisees, hiring a brand president, building teams, building training systems, building a marketing and a tech stack, and then kind of going to market. And that's when you and I started working together, and basically I had identified that the brand um at the time, for a variety of reasons, no one wanted to work with the brand anymore. And I had to essentially turn sentiment around within the larger broker community, and I had never worked with brokers before. And it was the middle of COVID. So I was literally cold calling you guys until you either became my friend or told me to go away. Um, and uh, and we did that, I did that defensively because I don't like losing. Um, and what ended up happening is it became offensive. We didn't have any time to do any organic lead gen at all. Um, because we were able to build such great relationships predominantly within France here. And since then, I've been able to now grow. I mean, we grew that from 98 units, kind of a backward system to 323 units in two years.

SPEAKER_02:

Okay, now hold on a second. So when I first saw Patch Boys, I looked at that and I said, I'm not touching that thing with a 10-foot pole, right? It's patching, it's logo with clip art. Like Jill and I looked at that and we're like, what franchise is this? And then here comes this guy calling me. Aaron Harper's calling me. And um, and like you said, at first, it's like, dude, come on. But what I liked about Aaron was this. Aaron has probably sold more franchises than 99% of the people on this planet. But Aaron doesn't try and sell a damn thing. If you if you get on a call with Aaron about any franchise he's representing, he's going to tell you the good, the bad, the ugly. And he's actually not going to try and sell you. In fact, he's probably gonna, it's almost like it's the opposite. Um, but by doing so, by telling people what it is like to be successful, what they need to do, um, and making sure they understand what's involved in business ownership inherently helped you find good owners. And actually, Catherine and I have a client who bought a Patch Boys from you, who is now looking to uh potentially diversify to his portfolio and who's doing really well. He told us a great story about how he always, you know, wanted he dreamt of having a certain kind of vehicle growing up, and he was finally able to buy it. And look, while some people may say buying cars is not the smartest thing you can do with your money, you know what, this is America. And if this is if that's what makes you more happy, exactly.

SPEAKER_01:

So also Jack won't say this, but he he exclaimed, Jack, you changed my life. You like hearing that on the call that we had together, just he's like, I love you, man. I love you. You know, you changed my life. You changed my life. Like that is the beauty of this all. And the beauty of us being franchise brokers, Jack being able to present him with different options that aligned with what he was looking for. And yeah, buying that car, that story was really cool.

SPEAKER_02:

So and it can, it can really change lives. So, okay, so this is a perfect the reason why I wanted to set all this up, Aaron. Let's get into now what are you seeing out there? You're a guy that's out there. You were recently at a conference with a lot of brands and things like that. Where do you see the franchise market right now? Like it statistically, if we looked at the last three months, here's how the sales break down 50% home services, 20% senior care, and the rest everything else. Yeah. What what what are you seeing? What are you what are your thoughts on the franchise market? What's heating, what's cooling? Like, what are your thoughts on where we are right now?

SPEAKER_04:

I thought, yeah, so I thought the residential commercial services would would really cool after a while since COVID. I don't know if you guys are seeing this, but it seems to like not be cooling at all. And in fact, there there seems to be even like more aggressive, more interesting, more niche service businesses going to market. You know, you've got the aircraft deal detailing concept, which is like super niche. And if you know anything about me, you know I love niche businesses. Um you're seeing like just like services making way more sense. Like if you think about, if you think about traditional franchising, right? People who are listening to this have maybe never heard about like they think it's McDonald's, they think it's Chick-fil-A, they think it's Wendy's, they think it's Taco Bell. You invest, let's just call it between 600 to 1.5 million dollars into one of those brands. You're gonna net best case scenario nine to eleven percent. So if you invest 1.2 million, you get that business up to 1.2 million, which by the way is not easy, um, your net on that's like$156,000,$7,000 or something like that. Whereas you could invest in a service business, maybe be like three to five hundred all in, and then net$150,000, let's just say$120 or$100,000 per unit. And so if you buy two, three, four, five units, and I'm just talking in generalities, right? Not specifically about any kind of brand, not about my brand, but like it just the economics make more sense. And in the in the market that we're in, there's a the lending environment has the highest interest rates we've had in recent history. Um, the SBA rates are now between like 10 and a half and 12.5%. Um home equity lines of credit are up. Like, so like if you think about the the opportunity relative to like how much the like the cost of capital, I think that's why so many people are are are trending towards services. And I don't want to mention the the brand, the the the portfolio specifically, because I don't know if this is um public, but there's about to be a huge transaction in our space. Um a portfolio is going to market uh and it's gonna probably be somewhere between a billion to a$1.3 billion transaction. And the last time that Residential Commercial Services has seen a transaction that large was neighborly. Um and when a transaction that large happens, you have significant institutional capital coming in and proving out this thesis that I originally had when I franchised Rolling Suns is that residential and commercial services are is the hot thing and will continue to be. And I think part of that has to do with like AI. Like you people are like CPAs, lawyers, like white-collar professionals are terrified right now. Marketing companies are terrified because they're gonna lose their job potentially in the next two to three years. We've already got coding that's basically gone. Um, you know what I mean? And so I don't think like robots are gonna start power washing houses anytime soon, or like fixing HVAC units, or like installing electrical. Now, maybe that's like way later down the line, but I think white collar is going faster than blue collar. And I think institutional capital is is seen.

SPEAKER_03:

Aaron, there's a lot to dig into with everything you just said there, but I want to go back where you started because you I think you have a different take than a lot of people looking for franchises, even in home services, where you said, I like a niche business, right? And what you founded here is a niche business. Um, you know, a lot of people like services, they like recession resistance, they're looking for these big core services, HVAC, roofing. Yeah, you know, but you have a business here that's kind of an afterthought, I think in a lot of businesses, right? It's a kind of a secondary service for a window cleaning business or other cleaning. So if you're an investor and you're looking at the franchise space and you really want to go big and you want to scale substantial business, why would you make the case for doing more of a niche service, say like power washing or you know, they don't have a power washing, but other more specialized services.

SPEAKER_04:

So I'll talk specifically about power washing from the lens of why I chose it, and then I can talk about why a niche is, I think, better. So I chose it largely due to the fact that there's such a high commercial uh element to this. Like we're 60 to 70 percent of our business is commercial, which is generally recurring or recurring in nature and oftentimes contracted for multiple years. Um there's still a residential component, it's just about 30 to 40 percent of our business. So if you think about like how a business scales, at least in my my you residential pays a lot of the like covers a lot of the costs, and then when you get a large commercial job, you can buy more trucks or buy more territories or hire more people or those types of things. When you have an only residential service business, it can only grow so large. Whereas if you have a residential and a commercial business, your total addressable market is larger. I also chose it um because there at the time wasn't a national player in the space. So I was like, it's a lot easier to become the 800-pound gorilla than it is to steal market share from the 800-pound gorilla, right? Like, so um, if you think about like SurvePro before there was any restoration franchises, like they became a multi-billion dollar company. If you think about 1-800 got junk before there were any junk franchises, like they became a billion-dollar company, right? So, like, and they didn't have any proprietary way to clean junk or to pick up junk, like they just were first, right? And so those were some of the reasons why I chose uh power washing specifically, because franchise owners can can build a sizable company in their local markets by servicing both residential um and commercial demand. Now, why I like niche businesses specifically is it is a lot easier to stand out in the eyes of the consumers if you are known for one thing. So, like think of Kleenex, right? Like Kleenex became the it's synonymous with tissue, right? Like, let me grab a Kleenex. It's it's because Kleenex wasn't you know a wipe for like your you know your head or your arms. It wasn't also a wipe for like the counter, like it was specific to one thing. And so in the eyes of the consumer, that that one thing becomes synonymous with the thing.

SPEAKER_02:

And so Aaron, we're seeing it again now with Chat GPT. You know, you may use a different kind of AI, but you say, oh, throw it into Chat GPT, even though you might be using Gemini or Claude or something like that. If you're to market first and you can sort of claim that that sort of thing, and it's actually, and I'm sorry to jump in, but if I forget, you know what's so interesting about 800 got junk? They, I mean, that is a model, that is a huge model for success in in you know services franchising. And then they roll out Wow One Day Painting, which I would argue is actually a super brand. I mean, it's very smart, right? WoW One Day Painting, you mean I can get my house painted in one day? Well, turns out you call them and you tell them of the project it may not be able to be done in one day. Right. The brand was different, and then they come out with you move me, and and they also had another one. And so on its head, on the surface, WoW One Day Painting is a, in my opinion, and I love Resi Brands and I love that one painter. On it, on the surface, WoW One Day Painting is a stronger brand. But that one painter probably outsold it 10 to 1 and did it in a year versus, you know, WoW One Day painters just kind of you know going along. And again, this is not at all um throwing um, you know, mud at that company. They're a great company, but it's interesting to me that that one painter comes along and essentially blows the doors off of all these other painting companies in terms of sales. And how does that happen? You know, but what go ahead.

SPEAKER_04:

I think they execute better, right? So like they clearly were able to get units and get a national footprint quickly by finding great franchisees and getting them open. Um, but Wound One Day Painting is a perfect example of coming out and not being and having the first mover advantage, right? Because at that point there was already SergeiPro, there was already, you know, um a variety of other brands. So you're coming in and and and now you have to execute considerably better versus just being first to market and having to execute better than the local guy, right? So when I was looking at brands, like I looked at roofing and HVAC and plumbing and solar and lawn care, and like every brand that I looked at had either an 800-pound gorilla or five to ten other brands that were all capturing some some element of market share. It wasn't a hundred percent necessary for me. Like it was a nice to have to be first to market. It wasn't a need to have because like you don't you don't need to be first to market in order to be successful. Uh Pinks is a perfect example, that one painter is a perfect example, Voda is a perfect example. Like, none of those brands are first to market as the franchise first franchise or but they're executing better than the other.

SPEAKER_02:

Pink's just had something, and I'll never forget, you probably you guys have all heard my story on this, but you know, Jill and I are that we were gonna buy that one painter, and we're at the Discovery Day, and we see the Pink's logo, like they were saying we just brought this brand on. And I'm like, hold up, hold up, hold up. Tell me about that. Um, because Jill and I have always been big brand people. And I was like, you know what? And I saw Brandon and Carter with the hats. Um, and I'm like, I guarantee you I could put one of those pink hats on everyone in our in our town. Um, and and that kind of drew me in on that. And I think that's again, you're right, that's a perfect example of a brand. I think Rezi had this culture. Also, frankly, Kimber did exactly Kimber's one of their franchise development people. Kimber called me nonstop until I started showing. She's like, You got to talk to us, you got to meet Steven. So it's the same thing that you did, where you kind of just roll up your sleeves as a new franchise and you go to work and you start getting the brand out there. Um and now we have, and and bringing it full circle, guys. Now we have real clean, which is as David well knows, he he has a client that was recently looking at it and lost out on a territory. You can't get real clean in Florida, it's gone now. And it's selling out across the country. And it only started with like with one or two units. So it's not like they're sitting there saying, hey, we've got a hundred locations. People are buying it. Why? Is it because it's different and in the service industry?

SPEAKER_04:

Um, I think it's because it's niche. I think that um, I think that's a big piece of it. I think it's also first to market. It really highlights a couple of the things that I liked about my brand um and just like about businesses in general. Um it's a lot easier to capture market share when you're not competing against anyone other than local guys, right? Um, and that's exactly where they're at. Um, I think that's part of it. I think, you know, obviously they're with franchise fast lane, they know how to move units. Um, I just read franchise sidekicks like franchise report based on like 73,000 leads. And they said 60% of the deals that are done in the broker community are from uh franchise development organizations. I believe that. Which is wild. And then 20% are done from like neighborly's authority brands, you know, home front brands, like these kind of portfolios. So that basically means for brands like mine, there's only 20% of the market share that we're capturing in terms of deal flow. I think one of my biggest concerns um about franchising currently, if we want to talk about hot takes, yeah, is when a brand when a brand goes to market, right, and they have one to two units, they will go to market generally in the broker community. It's very hard to become a large emerging brand in the broker community, or excuse me, a large emerging brand without going to the broker community, right? Like I don't I mean it's possible, but it's it's difficult.

SPEAKER_02:

It's hard. And you know, you can't like I fought it too, and and it when I was at home care assistance for years, we didn't want to pay the commission, right? We were like, no, no, no. And and then eventually it's like we were getting lapped by Bright Star, and it was like, okay, we gotta do it. And so we hired someone um who had broker connections and we joined all the broker networks and boom, a hundred franchises.

SPEAKER_04:

Yeah. And and I I don't inherently have any issues with franchise development organizations going to market, bringing a brand to market. Like I think that without that, a lot of these brands aren't aren't going to um aren't going to work. My problem and my concern is that a lot of these franchisors are going to market and doing that, and they don't have the money to do it. And so, like, I was talking to a um uh a brand that like because when I go to these events, like people follow me online, they're franchise ours, they want to do something similar to what Rolling Suds does, and they're like, How do you do it? Right. And so this woman's like, I am being pursued by every single franchise development company out there, and I heard you don't like franchise development companies, and I need to know why. And I'm like, I don't not like franchise development companies, but before we talk about that, how much money do you have to go towards franchising? She literally says, None. She says, none. Like it's not like I have 10 grand or I have a hundred grand, like the answer is none. So I'm like, okay, that's the problem. You're being pursued and you have no money. So like it's just with the diligence process. Like, so when she's like, Well, how much money do I need? I was like, at least five to seven hundred thousand dollars on the high end two million. And she's like, What? I was like, that's how much it costs. And if you go with a franchise development organization, you will have 10% of the franchise fee left over. And that's not enough to open the amount of units that they will inevitably sell.

SPEAKER_02:

But Aaron, don't you think honestly, this is the crazy thing, by the way, is that is I spend more time working with funds and private equity. This you think honestly, if you have a good concept, raising money for it should not be hard. It really shouldn't be hard. But they need to know that.

SPEAKER_05:

Yeah.

SPEAKER_04:

And someone needs to tell them that. And it might not be in their best interest to tell them that because then they might not sign them up as a brand. Sure. And that's my concern.

SPEAKER_02:

Well, isn't that how you did it?

SPEAKER_04:

You for with Rolling Century, you raised money. I raised capital and we did development in-house. So we were able to keep a larger portion of the franchise fee than if we outsourced it. And I still raise capital. And I have the experience in how to franchise a business. And the less experience you have, the more capital you're going to need because you're going to burn cash without experience. So that's my concern is we have franchise owners going to market, selling a bunch of units, being told that they're going to be able to sell to private equity if a bunch of units are sold, but there's no diligence, at least seemingly, on like, do you have the money to support franchise owners? And I think that without the necessary diligence on that, we're going to keep facing issues where franchise owners can't support franchisees because they don't have the money or the infrastructure to do it. And it was just her.

SPEAKER_03:

Okay, we don't we talk about this from like the viewpoint of a potential franchisee, right? Especially the one that says, you know what, I get the risk, right? But personally, how it's franchisee number three in a system, right? And so you have to know there's extra risk going into that. You know, you don't have the validation, you don't have the current financials across you know, across the country. So with these top brands that are taking off just like you mentioned, they're getting 60% of deal flow, right? They're growing from two and three units to 60, 100 units in the course of a year. What should a franchisee be asking? Like from your viewpoint, what should they be thinking about to mitigate that risk?

SPEAKER_04:

I'm gonna give more hot takes. You guys ready? Oh, yeah, come on. If that brand is saying, hey, I know we we have two units, we're gonna grow nationally, and I'm gonna tell you exactly that you can hire a general manager to run this thing and you can pay him 80 grand and he'll run it and you can keep your job full time. What I would ask if I were a franchisee is I would say, why don't you do it? Why haven't you done it if it's that easy? And if the brand is like, uh uh uh uh uh uh uh the answer is it's not that easy. Because if it was that easy, guys, let's just be real. I wouldn't franchise my business. Instead of taking 8%, I'd keep the entire economic benefit of the business. And I know that that's probably not what people want to hear, but if I were a franchisee, I would say, why don't you do it? If it's that easy.

SPEAKER_02:

Yeah, no, I I think Aaron, you're right. And that's you know, that's the whole premise of our company now with franchise owners helping future franchise owners, is that when people ask these questions, you know, you go to hire a GM, 80,000, 60,000, 100,000. Think of it this way: could you imagine saying to someone, hey, I've got a great idea. We're gonna build a million-dollar company. All we need to do is hire this guy for 60 grand and tell him what he needs to do, and that's it, million-dollar company. Um, that's exactly the thinking here. So now the the the line we walk is finding a way. When franchise owners make franchises special. Take Catherine, for example. We were having a conversation right before the podcast, and Catherine just met with her CPA who shared, and I'm not going to say the exact number because you know we don't want to make any earnings claims here, but Catherine's margins are fabulous. They are better than anything I ever accomplished as a franchise owner. Um, but that's not system-wide, I guarantee you. Um Catherine is an excellent owner and she's managing her margins well. And that's where I think the point of all this is. And if you go onto our website, you'll see this on our homepage. It's not about finding the perfect franchise because that doesn't exist. It's about becoming as close to perfect a franchise owner as you can. And what is that? That means understanding what's involved. I've always compared it to the first year of a franchise is like the first year of a new baby. You really have to put a lot of attention and care and effort into that new baby.

SPEAKER_04:

You can't even hold it to losing sleep and you're waking up multiple times in the night, just like you have a new baby. I've got a three and a half month old. It's no different. You're like waking up in a panic because the business is crying and you need to give the business a bottle, which is money that you didn't want to give it originally. I mean, I could go all day on this metaphor, guys.

SPEAKER_00:

Yeah. That's where I'm at right now, even with a top five franchisee. You know, my GM went down for a little while, and I had to step up, go down there and deal with up car accidents and and and just kept me up all night for for weeks, keeping me up, trying to figure out what am I going to do next.

SPEAKER_04:

And if you didn't if you had a full-time job that you weren't able to leave the office from in that instance, you'd have to quit your job or lose all your money. And um, and I just don't, I just want people to have success in franchising so that all of us on this this call have an industry to invest our time and money into for 20 years from now.

SPEAKER_01:

When I so I was still at my old company when I uh bought soccer stars, and I um was was like, you know, I came from franchising. So I knew exactly what I was getting into. And I was, but I was nervous, right? I was really nervous financially. My kids are in private school. Uh we have a mortgage, like we have all these bills, right? Like we need my income. And um I was at training in New York at the soccer stars headquarter, and I got laid off uh at their headquarters. I walk out, and there's Morgan, my best friend, who's also a you know, a soccer stars owner and a franchise insider. And they're like, okay, time to get officially known, and we're doing our ceremony. And sometimes God does for us what we can't do for ourselves. And so I was like, there you go. And I jumped right in immediately because I knew if I left training and I didn't jump in and hit the ground running, I needed that momentum to get going and I didn't stop. And my whole thing with owning a business was you need to. Lead by example. And I need to understand every damn aspect of this business in order to hire a manager to train to hire coaches to train to hold accountable. Like if you bring a manager in from day one, a general like this is just my opinion. Uh, how do you train them? How do you hold them accountable? How do you build a culture if you are not completely involved? I was coaching classes a week. I was doing sales, I was doing HR, I was doing everything. And did I burn myself out? Well, but yeah. But then, you know, I brought in a manager and I'm still uh working every day of the week, uh, every minute I can, but but less less, but less and able to focus on other things.

SPEAKER_04:

Because you've earned the right to do that right by building a great business.

SPEAKER_01:

And so, yeah, so my revenue I am at the top, and I do have the best profitability, but that's that's why.

SPEAKER_02:

So people say, they say to us, gosh, you know, when you tell us about the realities of this, why why would I do this? Why would I go through this hard time?

SPEAKER_01:

Why because and I'll again it's on our time.

SPEAKER_02:

Yes, you control your time. You're building it's like, you know what it is? It's like when you when you you know you want to rebuild your your kitchen and your closet in your home, and you go through that six months of rebuilding the kitchen into the beautiful thing that that you want it to be. And it sucks while you're doing it, but when it's done and your home now, you know, if you need to sell that house and you got the best kitchen in the neighborhood, you're gonna sell fast. And so the point of all this is that putting in the work and building the business, you ultimately, as the franchise owner, you're going to be the one that makes the business special. There's a reason why a couple of years ago, the crumble item 19 showed average franchisees netting like 250, but the median netting at 85. Um, because some people are better at running crumbles than others. And yeah, and what's great about franchising is that ultimately the more successful franchise owners will buy the less successful franchise owners. So you have built-in acquisition and exit. So for all of you out there who are sitting there who, you know, you say, Oh, I don't want a franchise, I want a mom and pop business because Cody Sanchez, and we love Cody Sanchez, but Cody Sanchez says, buy the old couple at the laundromat, and then the SBA is gonna pay for all of it. No, that's not gonna happen. Also, when you when you invest in a franchise, you get all the support, you get all the infrastructure, you get all these things to help you grow the business that inherently makes it so much more valuable.

SPEAKER_04:

Yeah, it makes it more valuable and you get speed to scale much quicker. And I want to be clear, like, it's not impossible to hire someone like David, you did it. And you know what I mean? So, like, I think that's where this gray area is is like, yeah, it's possible. Someone could do it. But like a franchise is built for an average person. David Barr says this, an average person on an average day with average skill set, with average market conditions, like it has to be built for the average. And the reality is that the average person who's been working at Oracle for 15 years as a VP of sales that has never opened a business before, doesn't know the stress of carrying payroll, doesn't know how to operationalize and improve profit margins, doesn't know, and and and and most managers aren't business owners. And in order to get something off the ground, you need the stomach of a business owner, right? And and so another trend I'm seeing, which is this is I'm really excited about this one, is because of this interest, this renewed kind of like almost renaissance of interest in business ownership. I think a lot of it has to do with like people like Cody Sanchez, uh, people like Alex Hermozzi who are talking about like, hey, build something. Like we're this is a this is a generation of builders. And then you have the generation under us that is like does not want to go to college and like doesn't want to work for someone, and they're starting businesses in college. And then you've got people that are Gen X and millennials who are like, wait, I've worked for someone else for 12 years now. I'm gonna go try to acquire an existing business, and that's this whole kind of like entrepreneurship through acquisition space, or it's been called ETA. What happens is a lot of these people who look for this unicorn of a business for 18 months that's doing a million in EBITDA and it doesn't have a fax machine, and there's just an old guy that's just waiting for someone to just take their business from them. Like, all of a sudden, people are like, wait a minute, I've wasted a year and a half of my life, and I'm taking on a search fund. So now I'm not even gonna own 100% of this business. I'm actually gonna be a minority owner, and I can't find anything, and now I've wasted a year and a half of my life. Those people are now coming to franchise ownership because they're like, wait, the exact reasons that I would buy an existing business, existing processes, quicker cash flow, a team in place, like all of the things that are in an existing business can be produced quite quickly with the right franchise brand. And so part of my goal as I continue to grow my franchise is to merge the franchise industry or help merge the franchise industry to this like ETA Hold Co kind of like that kind of niche community of like searchers. And so I'm going to an event called Main Street Summit in Columbia, Missouri, in November. Any of you guys should come. Um, last year I spoke at it. I was part of the only franchise panel at the conference. It's all about capital allocation, searching for a business, which one to buy, and about a thousand people go. And that panel went so well that they have an entire franchise track this year.

SPEAKER_02:

I love that. Well, Aaron, here's a quick, here's a quick little tidbit. And I know the team wants to chime in on this, but to your point. So if you spend an entire year and a half searching for that perfect business versus just getting started with the franchise, let me let me tell you what can happen in the meantime. Uh just last month, our clients Kevin and and um Kathy, who will be in our podcast next week, um, they invested in an Action Exteriors franchise, which is one of Resi Brand's newer franchise concepts. Um their business took off so fast, Cody Sanchez flew up to meet with them. Um they're in Tulsa, Oklahoma. Uh they a year ago at this time, they they called me because they couldn't buy Pinks. Pinks was sold out in their market. So we had to find them something else. And I shared with them the story of our client Harrison, who had bought a roofing franchise. And um Harrison's story is great because he's 29. He got an inheritance of like 300 grand. Um he buys two roofing units and two years later flips them for like six million dollars. Um that, that now that doesn't happen. Full disclaimer, it's not going to happen to you, but it's like these sorts of things happen. Um, and so now here's Kathy and Kevin. In less than 12 months, they built a business that is making good money. They're on being interviewed by Cody Sanchez, where they could have been doing exactly what you said, still searching on Biz by Sell for the perfect business.

SPEAKER_04:

Yeah. Bringing it all full circle, my concern is that there's the stigma for franchising in that community. Like, oh, I people don't know that they own 100% of the business. They hear the stories like Quizno and Subway and um anchored tiny homes and uh premier martial arts and these things, and then they're like, oh no, no, no. Like there was a post John Wilson from the Wilson Company, uh, he has a$32 million HVAC business. And he posted a thing that said, Would you rather take on a minority partner and minority capital or be a franchisee? And like the posts underneath were like minority partner, cap like blah, like, and it was just like it sucked because I know, and you guys know, and hopefully the people who listen to this know that franchising is a great way to build wealth if you find the right brand. And so my concern is that like if franchisers are coming to market without the money, they're overselling territories, they're not getting fully involved franchise owners, like they my concern is that that stigma doesn't change. And um, and I think it's our duty to change the stigma. Like, we're gonna we gotta take care of this industry, we're gonna be here 20 years later. Like, boomers aren't. Like they're retiring, they can maybe keep doing what they've done for the last 40 years. Like, we can't.

SPEAKER_02:

Well, and and let's be real, and this is the thing everybody needs to accept nothing's promised with business ownership. Okay, if you're going to take that chance, as all of us have, it you know, you have to understand it does fall on your shoulders. 100%. Um, and you have to make the business go. The franchise or is there to help you to provide support, but you have to be the one like Brian, like Catherine, like David, like you, Aaron, who got up, went to work, and built the system, and didn't, and there's still it amazes me, there's still people to call me and say, you know, I want one of those absentee franchises, you know, where they run the whole thing for me. And I say it's you're not gonna find it in franchising. You've tried. People try.

SPEAKER_04:

Yeah, it doesn't work. I joke, I sell people when they get on the phone with me, yeah, I've got$250,000. I've got about three hours a week to dedicate to the business, and I really want to build a multi-million dollar enterprise. What do you got? And I'm like, hey, um I'm in franchising. All my friends and I know all the brands, right? So we're we're got it the inside scoop. We're the franchise insiders. Like, we know what's going on. There was a brand where we could deploy$250,000 and work three hours a week. You wouldn't know about it because all my friends and I would have bought all the territories. Like we would own them all. We would just own them. We'd just it'd be a mutual fund. We'd all just be collecting cash. We wouldn't, it wouldn't even come to market because we would all know. And then they laugh and they're like, Oh, okay. Maybe I shouldn't buy a franchise. No, correct. You absolutely should not.

SPEAKER_00:

Well that leads me right to my question because that was one of the questions I'd written down. If you had 250k outside of your brand, where would you put it?

SPEAKER_04:

Um in a mutual fund if I had no time.

SPEAKER_00:

Okay.

SPEAKER_02:

Come on, Aaron. We're all in on Bitcoin now. Let's go.

SPEAKER_04:

Doge. I put it into Doge.

SPEAKER_02:

I'm just throwing on black at the You know, I just got this Gemini card, and I do want you to answer that question, but this this, and this is not a promotion, but it's so cool. It's like everything you spend, it immediately invests in the bit in the Bitcoin of your choice. So, like you're out to dinner and all of a sudden you get the instead of you know getting airline points, it goes into Bitcoin. I thought it was so cool.

SPEAKER_04:

I saw that I need to do that.

SPEAKER_02:

Yeah, it's the Gemini. I was I've seen the Gemini boys being interviewed, and I was like, dude, that's a great idea. I'm doing that. Um instead of getting points or like cash back or whatever, it just goes straight into Bitcoin. It goes right into crypto, and you can choose which which Bitcoin, which crypto you want. And you see it, and it's cool. Like, I have to admit, ignorance, I'm kind of late to the party on on Bitcoin and crypto, but it moves so much faster than the stock market. Like the the the swings that you see on it, it's really entertaining. But yeah, so everything you spend on it, uh Gemini card, if you're listening, I'll look for my royalty check. Um immediately gets invested, which is like to me, was so fun. So it's like you go out to dinner, you spend your 150 bucks, boom, your portfolio just got bigger. Okay, Aaron, outside of rolling suds, if you had 250k to invest in a category, not a brand. Yeah, where where would you go? Outside of services or outside of the thing. No, in services. That's any, you know, it could be painting, could be power washing, or not power washing, but outside of those.

SPEAKER_04:

Yeah, so I think um roofing is really interesting. Um I think fencing is really interesting. Um I think commercial cleaning is interesting.

SPEAKER_02:

Um Brian and I were talking about fencing the other day. Uh here's what's interesting about fencing. When we've got a client with top rail that is like blowing the doors off of it, fencing's really interesting to me across the three major brands. Their averages are insane.

SPEAKER_04:

Their averages are insane. Here's what I would do differently than what a lot of those brands are doing, though. Bring it. I would have all the employees be W-2 employees and not 1099. I think the challenge with 1099 employees, and you guys might have more experience than I do, is if you go to sell the company, you don't have anything. You have a sales and marketing person who's just contracting out stuff. Yeah. So it's like ultimately, like, we're all if you buy a business, like your goals, you should be thinking about like when are you gonna sell, like what's the end game, right? And so if you you have 1099 employees and you don't have any materials, like what do you have? You have a few sales guys and some marketing dollars, right? And um, and I think it's really important to set up an internal engine, a lead gen engine, a delivery engine that's predictable.

SPEAKER_02:

Um you think that's why certain so painting is is heavy uh subcontractor, but its resale value is like there's a there's right now on Biz by Sell a painting uh franchise in Florida that's doing a million seven and it's for sale for 200 grand. I mean, a business doing a million seven should be selling for a million bucks at least. That's exactly why.

SPEAKER_04:

There's no predictability. Like if you think about what like so you've got you've got great tick average ticket on painting, but once you've once you've done the job, they're probably not gonna call you again. So like exactly Hermosy says you either have a business where customers never stop buying for you, or you have sellers that never stop selling for you, right? Like those are the two, those are the two kind of things. And ideally, a business has both of those things, right?

SPEAKER_02:

Well, and if we look at what the funds want, what private equity when they're looking for franchisees to to recapitalize, and that's the other thing that does it does provide hope for people who who want to live this sort of lifestyle of of running a business where they're you know running it semi-involved. Here's how it can here's what private equity does. They look for really strong operators within a system, right? And they look for at least a million to three million EBITDA, and they say, let's recap that star franchise owner. And then Aaron, and and certain systems really embrace it and certain and others don't. But they come to Aaron and they say, Look, Aaron, your top franchisee, they're their EBITDA's three million. We're gonna we're gonna recap them, we're gonna put four times in their pocket, and then we want to deploy another 20 into your system and basically have them go quarterback 20 more units because they frankly they know what they're doing. Yeah. Um so you're right to, but what they want, they don't want those, even though again you could show them, hey, here's this painting franchise that did a million seven. Well, yeah, but they did this 50k here, 50k there. Whereas, like, you know, Catherine, recurring revenue, you've got recurring clients, David, you've got recurring clients. They want predictable recurring revenue. Um, and so for all of you guys thinking about a business, that's really, and I think Aaron brings up a great point. If you're gonna put in all this work and you're gonna build something, build to where you can have the kind of exit that will allow you to change your life. And I and I don't, you know, I'll tell you guys, my my father at 62 years old, um, coming out of a uh BK, had to start all over and had no money and had to start a franchise, had to start, he got turned down for a visiting angels franchise. Catherine, I don't know if you know this. Um so he had to start home care assistance. Um, and so but the point is here he was 62 years old, three kids in college, and he starts this business with 300k in his pocket. Um, so that's the beauty of why. And it was hard, hard, hard work. He's in an office all by himself, everyone in the family doubting him, saying, Why on earth would you want to do this senior care business? And then two years later, all of us begging him for a job. Um, and it turned into this wonderful company. So, but the point of all this is, and you guys, you guys on this listening to the podcast are hearing a lot of the battle scars. But the point is, is that they're worth it if you can build, you've got to have an end goal. You can't just go on aimlessly and say, well, I don't want any employees and I don't want to do work. But I think it'd be cool to tell people I own a business. If that's you, don't do it.

SPEAKER_04:

I I mean, I I think we should make active income cool again. Let's make let's make active income cool again. I mean, like every single person like has that has ever built any meaningful level of wealth went all in on something for like a serious like amount of time and then diversified. Like diversification is pro is a problem for future you. Like if you have a job right now and you're looking for like that's diversification, seven streams of income, like that's a problem for future you to figure out. And um, like I I have 24 team members. I stepped into a chairman of the board position three months ago. And I'm six weeks into the pos into like chairman of the board, you know, high-level content creation, broker strategy relationships, like that, very high level and a department in my company, as you guys know, needed attention. And so I step back in. So I have 24 team members and I'm not semi-absentee. So like I would say that the business that that someone's considering buying should be worth not only your time, but constant reinvestment of time and capital. Right. So like if you buy a franchise, you should see a path to two, three, four, five million plus. Like, and and then what do we have to do to get there? If it's a B2B service business, if it's a staffing and recruiting business, like a cleaning business would be basically a staffing and recruiting business, right? Like a B2B business is a sales business. Like, what do you like doing in your normal life? And typically, like if you're good at sales and someone's paying you$150,000 to$200,000 to do sales for their company, you don't own anything of that company. What if you put that effort towards your own business? You would create enterprise value and then you'd be able to change your life. Um, so I would I would urge people to do that when they're thinking about a business.

SPEAKER_02:

I think something everybody on this podcast does really well. Um, Catherine, Brian, David, Aaron, you guys are all excellent at selling without selling. Meaning that you guys aren't trying to sell. Personally, I think the day of like the slick sales guy is done. Nobody wants it anymore. People want realness. People want, I'm gonna go on, I want to listen to people, I want to hear real experiences. And I think you guys are all great at that. You're not trying to sell anyone anything, but you're by your sheer energy and honesty and and just real experiences, um, that draws people to you and wanting to work with you. Thank you.

SPEAKER_01:

I just want to help help people. I mean, that's my approach. Like I've been meeting with different local businesses for soccer stars, uh, like that have similar, you know, that have young kids. And it's like, how can I help you? You know, how can I help grow your ballet business? Like, is there anything I can do? And they're like, Well, how can I help you? It's just coming at it with um, I don't know, just the reciprocity kind of approach of building business and just being a connector, right? Like Francesca did that so well, Jack. She was one of our top salespeople at our old company. And she just comes from a place of heart. And I think that's what we we all come from, a place of heart, and just wanting to make the world a better place and to help people, whether it's our our end user or our employees, and like that's authentic, and like that is what sets that intention and like grows a really powerful and successful company.

SPEAKER_02:

I love it. Last last thoughts because Aaron, I know we're against it. Brian, uh, David, you guys want to share some some last takes, questions?

SPEAKER_00:

You know, um, I came from law enforcement and my whole my whole life was just trying to help people, and I'm out of everybody on this panel right now. I know I'm you know still at the bottom working my way up, learning, and I'm just grateful that I've given this opportunity. But you know, all this well going full circle, it's just because I'm here just to help people. Um, and that's that's my story, and that's why I'm you know became an insider. Love it.

SPEAKER_03:

I think uh I'll just highlight something that Aaron said, and I think again, it's just so important to be very real when you're in your due diligence, you're looking, listening to podcasts, doing your search. You know, when you're building something the way Aaron's building it, or the way David's building or the way Catherine's building, it's all in, right? These are not part-time gigs, this is not a side hustle. Um, you know, so you know the level of effort directly correlates to to the size of business you build. So I think you know, I just appreciate Aaron coming in being very honest about what it takes to build a million-dollar business.

SPEAKER_04:

Thanks guys for having me. It's been awesome.

SPEAKER_02:

Aaron, we're gonna have Josh York on next week. Have you ever met Josh from Gym Guys? Yeah, I have. He's a cool dude. You guys will get along, I feel like. Yeah, yeah, yeah. We haven't talked uh at length, but yeah. Yeah, he's it's the same sort of thing. So, but no, I mean, I shouldn't say it like that. Aaron, there's no one like you. You're you're and you're you knew you would be a perfect guest for our podcast because you say it how it is, you want to help people, you truly do. You come at this from the right place. Um, so all for all of you listening, I think you just got a gold mine worth. I mean, we had a whole agenda, we didn't even get to like even half of it because there was so much good stuff. Um, Aaron, anything that we've left unsaid? Anything you want to just uh finish up the podcast with?

SPEAKER_04:

No, I think I think come to franchising as a franchisee for the right reasons to build something meaningful. Um, as much as it's on us to help as a franchise or to help you build your business, I've put everything on the line to build a great brand. This is my everything. And so I expect great franchisees to come in and give their all to build a location. And I can't do that without without franchisees putting their effort towards it. And um that's not just money, it's time, it's effort, it's attention, it's care. Um and uh and and you can't build a great franchise brand without franchisees putting their all into it. And so it's both, there's both sides to this. The franchisees and the franchise or have to work together. Um, it's a partnership.

SPEAKER_02:

I think that's great. Uh, Aaron, thank you so much for being our guest today. This has been fabulous for all of you listening. Um, if you'd like to have a conversation about franchising, you want to speak to a real franchise owner, go to thefranchisinsiders.com. I urge you to go to our team section, read the bios on Catherine, on Morgan, on Brian, on David, on Jill, and myself. Um, any of us would be delighted to help you with your franchise search to get you in contact with franchise oars, great franchise oars like Rolling Suds and Aaron Harper. Uh, so again, visit thefranchiseinsiders.com. And for all of you listening, we appreciate you greatly, and we'll talk to you next time.