William Fry - Founder of Mainshares

In this debut episode of American Operator, JC sits down with William Fry, founder of Mainshares, to discuss the mission behind Mainshares and the Operator Network. They explore why keeping businesses in the hands of local owners benefits communities more than selling to large private equity firms, and they share insights into the future of American small businesses. Discover the power of local ownership and what it means for the next generation of American Operators. 

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Transcript

00:00:25:22 - 00:00:39:04
Speaker 1
All right, team. Welcome to the American Operator podcast. I'm Joseph Cabrera, your host. So it's kind of a this is a new concept. And before I introduce our really illustrious guests here today.

00:00:39:06 - 00:00:40:08
Speaker 2
To to the.

00:00:40:08 - 00:01:03:08
Speaker 1
Whole world, I want to give a little background with this American operator thing he's all about here at Maine. Cheers. The team here, we're focused day in and day out on not only helping small business owners find the next person to pass the torch to, but probably even more importantly, figuring out how operators or future owners get to the point where they can find that hunt to be successful in finding a business.

00:01:03:08 - 00:01:20:20
Speaker 1
But more importantly, probably getting to the point where they're running this thing in a way that they feel confident and can send this business into the next 30, 40, 50 years in a really good way. And so what we wanted to do here on the American operator is highlight all the things that you can't find in a book, or you can't study in an MBA class.

00:01:20:22 - 00:01:48:07
Speaker 1
And this map, my hope is it is it's more entertaining than it is educational, because the stories and the grit and the randomness that happens with running these small businesses are things that I don't think are talked about often. Usually it's the Amazons and the goldmans of the world. They get a lot of the street cred for doing really innovative things, but half our countries tightness in the fabric there is based on these small businesses in America really just helping their communities out and during the weird stuff that comes in between.

00:01:48:07 - 00:02:02:11
Speaker 1
So on the American operator, we're going to talk to really great people on the team owners out there in the field, folks that are up and coming in, than anybody just kind of related to it. And my hope is that you just get the human feeling behind what it takes to to be a part of and run these businesses.

00:02:02:11 - 00:02:10:06
Speaker 1
And so I couldn't think of a better way to kick off this podcast than with main shares founder William Frey. How are you, man? I'm.

00:02:10:06 - 00:02:14:16
Speaker 3
I'm well, but, lower your expectations, though. Only get better from here.

00:02:14:18 - 00:02:31:01
Speaker 1
Well, I can't think we're breaking it. So the other thing is, because we're breaking this in at our studio here at our new HQ here in Austin, Texas. If you ever want to go find it, can you tell folks at it like it was a day one. You basically go one, Bandera it up.

00:02:31:05 - 00:02:39:15
Speaker 3
Yeah. We got some flags out front. Yeah. American flag, Texas flag. Come and take it. Which we'll probably touch on later, but, yeah.

00:02:39:17 - 00:02:57:07
Speaker 1
It's, it's a cool spot. And for those are not probably familiar with Austin or if you are familiar with Austin, only probably through the radio waves and stuff like that, I think you'll realize very quickly that, this place has got its own, its own energy compared to the rest of Texas. It's nice to have just a bunch of red, white and blue hanging out here.

00:02:57:07 - 00:02:58:18
Speaker 1
Just a cool place to be, I think.

00:02:58:22 - 00:03:02:18
Speaker 3
Your friend said it was like the only, come and take it flag that I've seen.

00:03:02:20 - 00:03:03:10
Speaker 2
Yeah, they've.

00:03:03:10 - 00:03:05:08
Speaker 3
Seen downtown off.

00:03:05:10 - 00:03:05:21
Speaker 2
That's right.

00:03:05:21 - 00:03:16:05
Speaker 1
Man. Yeah. So, okay, let's I think probably a small history lesson is probably in order. Sure. Let's talk main cheers. But go far back as you want to give context to

00:03:16:05 - 00:03:21:14
Speaker 1
anybody who's tuning in right now, who goes, what the heck is main? Cheers. Yeah. How would you describe it?

00:03:21:16 - 00:03:47:05
Speaker 3
I would say our mission is to back, the next generation of owner operators, here, here in the US. We founded it actually, out of a, a business brokerage that we were running, called beacon and a beacon. Our job was to sell businesses for for owners who wanted to retire. And what we found was that owners were often forced to make this kind of trade off of.

00:03:47:05 - 00:04:08:17
Speaker 3
Do you sell to the person who has cash, who can secure the financing for the deal but probably isn't going to uphold your reputation the way you want? May not treat your employees the way you want them to be treated. May not even know the trade. Like you and your employees do. Or, on the other hand, you sell it to the person who may, in your words, deserve it.

00:04:08:17 - 00:04:33:15
Speaker 3
Or the the number two employee who's been there for years. The operator across town, the catch 22 there is they may not have the cash to actually pay you kind of fair market value. And so you're kind of in this really unfortunate trade off. And so what we do is we work with those really talented operators and we help them with financing, access to investors, community, training, you know, the whole whole nine yards.

00:04:33:17 - 00:04:52:03
Speaker 3
And the goal really is to keep these businesses locally owned. It's kind of an anti anti private equity model. So you know maybe a little bit controversial there. But but the goal is like if you keep this ownership local, you get a bunch of great outcomes from that. You have the wealth created locally.

00:04:52:03 - 00:05:15:03
Speaker 3
It stays local. What does that mean? Well, it means those businesses are sponsoring the little League. They're the ones, you know, backing Boy Scouts, the ones kind of investing more into the community. You're also keeping more jobs there. All of the studies on kind of transfers within an industry versus private equity. There's much more stability there. So we believe it's kind of our duty and, and, you know, if we are in a just for the money, that's probably easier ways to make money.

00:05:15:03 - 00:05:19:06
Speaker 3
And we'll get into some more stories. But yeah, in a nutshell, that's that's what we're about.

00:05:19:06 - 00:05:36:04
Speaker 1
Yeah, man. When you talked about the, the private equity thing, I know, I know, that's probably a little touchy, but I think it's probably where I know I like picking at that scab a little bit and actually being in the world I grew up before in this, in this kind of ecosystem, dealing with that, with that group of folks.

00:05:36:04 - 00:05:58:13
Speaker 1
And I don't think folks are inherently bad. There, but I do. What's Will Frye's $0.02 on if we don't keep business local, then from just like a little humanity functioning day to day, right. What happens like if it all just basically rolls up into some glorified spreadsheet for a big wig in Wall Street? What happens if that happens?

00:05:58:15 - 00:05:59:12
Speaker 1
What doesn't happen?

00:05:59:12 - 00:06:25:04
Speaker 3
I think there's like a few elements there. One is that, you know, you you could see some, doomsday scenario where, you know, all small businesses are owned by the same 30 private equity shops. And, and they're trying to do it in single family housing. And what that ultimately means is a few things, like one, if you think about the value of small businesses to a community.

00:06:25:04 - 00:06:51:02
Speaker 3
So like on any of the surveys, small businesses are the number one trusted institution in the US. I shared one and, yeah. And slack the other day, and it's above the U.S. military. It's above religious institutions, it's above hospitals, it's above educational, institutions, universities and whatnot. And if you think about like the reason for that, it's that it's kind of that last place where you see the humanity in each other.

00:06:51:04 - 00:07:08:17
Speaker 3
You know, you go to the coffee shop and you can see, let's go, Brandon, or Trans Lives Matter and, you know, you get your coffee now, you know that that person, regardless of what side you're on, you're like that person. You know, they treat me well. Coffee tastes great. Maybe I met a neighbor there. I saw someone who I see every time I go get coffee there.

00:07:08:17 - 00:07:41:01
Speaker 3
And it kind of, like, brings you back home. You don't have that experiment experience at Chick-Fil-A? Necessarily. You don't have that experience at target. You don't have that experience at companies that have, like a very corporate sense. There's higher turnover there. It's a less so for experience. So I think just from like the fabric of our country, when people are more divided than they probably been since the, you know, late 60s, early 70s, I think it's really important to keep this kind of like local ownership, populace, you know, sense amongst small businesses.

00:07:41:02 - 00:08:02:19
Speaker 3
I think that's, you know, aside from the economics, on on the wealth creation side, one of the, the great things about our country is how many smart people from around the world it attracts, and every not every most immigrants have that story of they came, to the shores of our country, and their parents started a pharmacy.

00:08:02:19 - 00:08:19:13
Speaker 3
Their parents started a dry cleaner, their their parents started a painting business. And I think that, culture of kind of being able to build the future that you want to live in is very much it's not actually driven by tech startups, like just past ten years. You know, those are the ones who get the glamor.

00:08:19:16 - 00:08:49:17
Speaker 3
Yeah, most of the time, those don't end well. And, you know, the past few years have shown all the flame out, but more than that, it's the small businesses that really create wealth and create opportunity, in our country. And it's a different than a lot of other countries out there. So I think it's really good from, you know, continuing to grow our population, continuing to attract really bright people to our country, people who share, ironically, probably more values with the Founding Fathers than some people in the States do these days, which is another topic.

00:08:49:19 - 00:09:09:14
Speaker 3
And so I think from like a wealth creation and attracting talent perspective, it's good for that. And I think the third piece is that, when you have local ownership, you typically have people who care more for their employees. And I think you could you can read that two ways. One is that because the control is there, you're able to actually provide to your employees.

00:09:09:14 - 00:09:26:10
Speaker 3
You're not a general manager of a private equity owned, pet store or something where you can't really make exceptions. If someone falls on hard times, you can't really make exceptions if they take a couple weeks out for it. The policies, the policy, they violated, the policy, they're out. So you just get a little bit more wiggle room there.

00:09:26:12 - 00:09:47:15
Speaker 3
And so I think even for people who aren't necessarily owners of small business as an employment function, it's really important. Like today, I think they employ like, at least 60 million Americans. Yeah. Chuck. So, yeah, I think there's a lot of benefits to, to small business ownership, both for like, society and our country, but then also to kind of the economy and economics out there.

00:09:47:17 - 00:10:04:10
Speaker 1
What do you think is a misnomer that or maybe a misunderstanding about what people think? Small businesses? I think you're right. You got coffee shops, you got the local pet store. But it does run the gamut, right? Like I think you're educating somebody about what is small businesses. It's kind of a bad word. We probably need to come up with a different way to describe it, right?

00:10:04:10 - 00:10:32:20
Speaker 3
Yeah. I mean, I think, the way that I think about is it typically means that you have, an owner operator who knows all the employees working there. It's kind of like my mental model for it, but you run the gamut. I mean, everything from the most white collar small business. So, you know, doctor, lawyer, office, whatever, all the way to, like, one of the businesses we dealt with in the early days is like crime scene cleanup business, and everything in between the trades, manufacture and distribution.

00:10:32:22 - 00:10:56:15
Speaker 3
So I think that there's a kind of a wide, wide variety in terms of what I think people misunderstand. It would probably be, maybe two things from the, corporate America refugee or kind of the white collar finance pro, for lack of a better word, who's thinking about like, oh, you know, small business, low more towards passive earnings or whatever.

00:10:56:17 - 00:11:17:07
Speaker 3
I think they misunderstand how much shit eating there is. And how if you're crudely gets a DUI and is in the drunk tank, you're plundering the toilets. You're not going to sit and work on your financial model. From the people who aren't necessarily looking at buying a business, but are more so, you know, and maybe corporate America and another walk of life.

00:11:17:07 - 00:11:41:20
Speaker 3
And they think about small business owners. I think they may be mis underestimate, or underestimate how short these guys are. And I think it's been humbling. And in my journey, the past four years, just like these are really salt of the earth people. They may not use the biggest words, but they're pretty fucking sharp. And they understand how the world works.

00:11:41:20 - 00:12:03:19
Speaker 3
They understand why things need to be done a certain way. They put in their hours, they put in the kind of grunt work. And I think that sometimes you come in and you're like, oh, you know, things could be done so much better here, or it should be done so much differently here. And then if you're a little bit more humble and you spend a little bit more time with them, you understand the way the world works and why it does.

00:12:03:19 - 00:12:05:09
Speaker 3
So I'd say that approach to things.

00:12:05:09 - 00:12:22:22
Speaker 1
Now, you made me think about these thing as a quick rabbit hole, but I think it is completely related. And if it's not, well, it's our show, so we can do what we want. But I think that if you if you ever went back and you talked about tech startups, I remember going to South by Southwest a few years back and just thinking to myself how the tune has changed.

00:12:22:22 - 00:12:41:14
Speaker 1
I think I went to I went one early, like five years back or so. Then I went one just a year ago, and it's like the whole tune is changed about like what's good investing stuff. And that's a whole different topic. But I wonder if you were to, like, go all the way back to 1978 or 1983, or some of these businesses were getting started by some of these owners.

00:12:41:16 - 00:13:01:05
Speaker 1
Do you think there are better entrepreneurs? Like they were just better at running? Like, do you feel like the hit rate of success, like they were better if you had 100 business, entrepreneurs that decided to start a business, that a higher ratio of them actually got to where they went past the ten year mark than today?

00:13:01:07 - 00:13:02:10
Speaker 3
Yeah, probably.

00:13:02:10 - 00:13:04:10
Speaker 1
Why do you think that is?

00:13:06:10 - 00:13:18:10
Speaker 1
Or what your gut say? And I'm alluding to the fact that, like, you and I had barbecue the other day with a couple guys in a dive. Yeah. And they just have a grit about them. That's different. Yeah.

00:13:18:12 - 00:13:39:05
Speaker 3
My gut would be that there are more owners today that have grit, and are sharp than there were back then. I think that's just population growth, though. I think what's changed is that more people are attracted into the space for the wrong reasons. So I think that that skewed the ratio. Interesting. What's the like on average?

00:13:39:05 - 00:13:57:16
Speaker 3
I'm probably more of an optimist. So, I would say that there are as many or more hardworking Americans with good character who care about their communities, who are driven to, to build businesses. And there's a variety of reasons for that. There's some that are passionate about the trade, some who need the money, some who frankly had no other options.

00:13:57:16 - 00:13:59:15
Speaker 3
Right. They got in trouble or something like.

00:13:59:16 - 00:14:00:13
Speaker 1
Backed into a corner.

00:14:00:13 - 00:14:19:09
Speaker 3
Yeah, into a corner. And I think that, by and large is true today. I think in addition to that, we have a cold, like, this whole internet culture kind of get rich quick, thing that that probably wasn't as true back then, like you had finance ripping in the late 80s. So everyone then wanted to go into Wall Street.

00:14:19:09 - 00:14:34:16
Speaker 3
And that was kind of first, like flash in the pan. Yeah, in a handful of decades. Like, I generally think the world kind of continues to operate the same way decade after decade. And, you know, you can say the same thing was true about gold in that in the 1800s. But I think it kind of maybe cooled out in the 50s, 60s.

00:14:34:16 - 00:14:53:00
Speaker 3
You had the Cold War, you had other kind of factors at play that, there was a lot of kind of flash in the pan, you know, gold rush type dynamic. But I think over the past maybe 40 years or so, there's been kind of if it wasn't finance, it was management consulting. If it wasn't management consulting, it was the internet dotcom era.

00:14:53:02 - 00:14:56:14
Speaker 3
Then you had, you know, crypto. And now I guess you have AI.

00:14:56:14 - 00:15:17:11
Speaker 1
So yeah. No, there's a lot of that. Yeah, there's, there's a lot to think about in that world of work where that it probably more added some duty or obligation. It almost from the beginning. If you talk to these owners, they weren't ever trying to be fancy about what they did. They ended up becoming these multi-millionaires seven, eight, nine figure business owners.

00:15:17:13 - 00:15:20:08
Speaker 1
Yeah, I won't say by accident, but almost unintentionally.

00:15:20:10 - 00:15:39:00
Speaker 3
Yeah, yeah. That's right. I mean, most of the kids I grew up with, grew up in eastern North Carolina, either work for a small business or now own a small business. And the ironic thing is, I then went to one of these kind of coastal elite schools, and now, yeah, the classmates they had, they're trying to get back to the same place that, you know, Dylan and Nick went to right after community college.

00:15:39:00 - 00:15:47:08
Speaker 3
So, and world is, ironic, Edu, is that you learn things like the most ironic outcome is the most probabilistically.

00:15:47:09 - 00:15:49:05
Speaker 2
Yeah. No, that's,

00:15:49:07 - 00:16:04:23
Speaker 1
Well, we're let's go back to that barbecue gumbo. The other day, we, you and I were hanging out. I think we were meeting these. We were. We were meeting these two owners in a, a non hipster barbecue joint. Yeah. Where you can still get brisket and ribs and all the fixings for, like, was ten bucks, you.

00:16:04:23 - 00:16:05:15
Speaker 3
Know, ten bucks.

00:16:05:21 - 00:16:10:11
Speaker 1
Cheaper than. I mean, right now, I feel like two slices in Austin is, 20 bucks. They give.

00:16:10:11 - 00:16:11:20
Speaker 3
A shit for it at the.

00:16:11:22 - 00:16:13:03
Speaker 1
Register. And there's. Yeah.

00:16:13:05 - 00:16:14:17
Speaker 2
That's exactly right. I mean.

00:16:14:19 - 00:16:32:14
Speaker 1
So we're hanging out, and I remember those guys, we were talking to them, and there's just like, there's a bit of a, there's a, there's a bit of a hardness. They have now granted they were, they were in a particular industry. They kind of mentioned that. But a lot of the, a lot of the owners we talk to, you have this kind of non gloating way of talking about those things.

00:16:32:14 - 00:16:43:21
Speaker 1
Yeah. Was that at all what attracted you in the early days to kind of be coming into this space and helping out? I mean, you, you talk about running around and talking to automotive, you know. Yeah. Companies.

00:16:43:23 - 00:17:04:02
Speaker 3
I don't know if it was specifically like the the goodness of the rough around the edges piece. I think it was more so like going back to to Nick and Dylan after this, to another, outing them on a podcast. They were our next door neighbors growing up, the seeds. And so I knew that, like, I wanted to build something that seeds would use in some way, shape or form, whether it's their personal lives, of their professional lives.

00:17:04:04 - 00:17:23:17
Speaker 3
And I think like by nature of growing up in a small town in eastern North Carolina, I was kind of used to those folks, those less so that I was attracted to, kind of like the, the ruggedness, necessarily. Then I was like, these are the people who, I believe are like most emblematic of the US and what we have to offer.

00:17:23:17 - 00:17:51:02
Speaker 3
And, those are the people that it's really rewarding to build for, to serve. In, in business. I had spent a handful of years in a different space and, one in kind of hedge funds and one in more in the political arena, and you feel just kind of disconnected from how the world turns. And the cool thing that we've jammed on before is like, you know, I hope Joe isn't listening to this, but like, let's say this shit hits the fan tomorrow and the business goes completely belly up.

00:17:51:08 - 00:18:13:08
Speaker 3
We've helped so many people create wealth, retire from, you know, 40 years of a career and the automotive industry and Hvac and electric and whatever. And I think that those wins along the way are like, so, personally fulfilling. And I think that helps you continue to eat shit on a daily basis because it's kind of a crazy space.

00:18:13:10 - 00:18:30:18
Speaker 1
It is. It's wild West, for sure. When I think about the the for those that are out there right now, they think that when you when it comes to even like how how a business gets past one or the other, I think you think really sophisticated investment banking or you think like real estate agents selling a house. Right.

00:18:30:18 - 00:18:39:08
Speaker 1
And it could be it's like the furthest from the other two. There's some, there's some like seasonings. Yeah. But otherwise there's no real playbook for it.

00:18:39:10 - 00:18:51:10
Speaker 3
No. Yeah. There's no there's no regulation for it. Which explains some of it. But yeah, it's you know, wow, this is a great way for the what?

00:18:51:11 - 00:19:09:11
Speaker 1
Before we kind of go into some, I want to dive into just your personal experience with a lot of these operators, a lot of these owners. I know you've had just a really cool, intimate experience with a lot of them in the early days and still do. And some of the ones that we've, you've shared with me just in our travels instead of just kind of makes you laugh so hard.

00:19:09:13 - 00:19:30:04
Speaker 1
But before we go there, let's talk about kind of the the the operator word of American. Operator. Yeah. And where this idea comes from with setting up, you know, you got main cheers, which is really like mothership. Yeah, it does a lot of things, but the operator network just from, well, fries brain. You know, why is that important and what do you feel hopeful about that.

00:19:30:05 - 00:19:49:23
Speaker 3
I think like kind of the word that we throw around a lot here, I mean, chairs is like owner operator. And if you think about what's the harder piece and what scares, it's the operator. That and that means that you're in the business working on the business. In the business, you're dealing with employees, you're dealing with the customers.

00:19:50:01 - 00:20:09:19
Speaker 3
Oftentimes you have no playbook. You may not have a great support system. And if you do, it's probably other guys winging it just as well. And it's that operator kind of class in America, or what? Like Benjamin Franklin called, like the tradesmen or the, the leather aprons. Those are the people that kind of keep the lights on around here.

00:20:09:19 - 00:20:33:16
Speaker 3
It's not kind of the owner class. It's not the investors. It's the people actually run the business on a day to day basis. So I think from, from our perspective, we wanted to build a home to help forge, really, really great operators. And I think today, the way that we kind of help them move into the owner is operators is through acquiring businesses from retiring owners.

00:20:33:18 - 00:20:57:17
Speaker 3
But that's not where our ambitions stop, stops or, you know, where we see the story ending. We would love in a handful years to help them start new businesses. Help them buy franchise territories, like, whatever they, however, they want to kind of, like, realize their dreams and their goals. And from from our vantage point, if you look at the best operators, they care least about buying a business, right?

00:20:57:21 - 00:21:27:04
Speaker 3
They care about being a really good manager, being really good at their trade, being a good owner, providing for their family, providing for their communities, buying may just be a hassle. And so whereas there are some other options out there for folks who just want to look at buying a business, we wanted to be really intentional about building a home for people who were really passionate about being great operators and help turn them into owners, you know, regardless of how they see, you know, the best journey to get there.

00:21:27:06 - 00:21:30:21
Speaker 3
So that's kind of like our, our mantra. And what drives us.

00:21:31:00 - 00:21:33:08
Speaker 1
Yeah. Has how do you feel it's going.

00:21:33:10 - 00:22:05:05
Speaker 3
Really well. Really well, I mean, I love it, like it. The people are interesting. Their characters, they all have their own, ways of kind of going about life. But they share, they share a really, great work ethic. They share a love for the country. They share a curiosity about how to, improve as as individuals, as business people, as tradesmen and women.

00:22:05:07 - 00:22:07:17
Speaker 3
So it's really rewarding. For sure.

00:22:07:17 - 00:22:25:23
Speaker 1
Do you have any, any, on the operator front, do you have any folks that kind of stick out to you, just folks that you have ingrained into your brain or into your soul just because of who they are? And because I'm thinking most folks out there probably have some probably trying to get their head around, like, who's this person he's talking about?

00:22:25:23 - 00:22:40:17
Speaker 3
Yeah, I mean, yeah, a ton. There's, there's one great operator, down in Minneapolis who runs that crime scene business. And he is just like to a tee who needs to be running that business.

00:22:40:17 - 00:22:42:11
Speaker 2
Tell me about this guy.

00:22:42:13 - 00:23:04:17
Speaker 3
So he his story is he in the 90s, he was a paramedic, and he realized that, when you leave the scene of trauma, the paramedics are normally the last people who treat you with professionalism. And then whoever's left at the scene is kind of left picking up the pieces. And so he built a crime scene cleanup business.

00:23:04:17 - 00:23:26:19
Speaker 3
The technical term is biohazard remediation. That would come in and just help, you know, make things right and make things closer to how they were before, whatever incident happened. And my first question was like, Nate, who the hell do you hire to work in this business? This seems terrible. And he was like, no, well, you have backwards.

00:23:27:01 - 00:23:40:21
Speaker 3
I hire all my buddies who work in EMS, work as firefighters, workers, policemen who are underpaid by the government. They moonlight here and they also send me business. I was like, oh, this is genius. They believe in the police.

00:23:40:23 - 00:23:43:20
Speaker 2
They come back, change uniform.

00:23:43:22 - 00:24:09:16
Speaker 3
And then after growing that business, he realized that, while they were, you know, remediating whatever was at the scene, oftentimes they made damaged, materials in the home or the apartment or whatever, except to use pretty corrosive chemicals. So he built a, restoration company that would like, restore the business to, to or the home, and then bill insurance for it.

00:24:09:18 - 00:24:20:22
Speaker 3
And then he realized that, sometimes people are so traumatized that they didn't want anything to do the house. So he bought it, or he started to fix and flip business to get out of here. So the only thing he doesn't do is, commit to.

00:24:20:22 - 00:24:25:11
Speaker 1
Commit the crime, which I think he would go that. Yeah, that's extremely vertically integrated.

00:24:25:13 - 00:24:48:13
Speaker 3
And and that my wife at the time was, was going to business school, and I was like, you guys are missing the number one case study in synergy of all time. You you MBA it did. But, he was just like the most blunt guy. Really? Matter of fact, rough around the edges. But then once you kind of earned his respect, he'd do anything, anything for you.

00:24:48:13 - 00:24:58:14
Speaker 3
And it was a joy to work with. And I think that, has just kind of repeat itself with most of the owners we've worked with where, they're all characters and some shape or fashion.

00:24:58:14 - 00:25:01:06
Speaker 3
But they're great people, and, you know, they keep the lights on here.

00:25:01:09 - 00:25:07:16
Speaker 1
Yeah. There. So, yeah, they're, you're right, salt of the earth. But they got, they kind of had not going to give you respect easily you know. Yeah.

00:25:07:17 - 00:25:10:19
Speaker 3
You got to earn it. You gotta be on a default. Not trusting.

00:25:10:21 - 00:25:16:01
Speaker 1
Yeah. Yeah I know that's right. For a lot of different reasons I'm sure very tax averse. Yeah.

00:25:16:05 - 00:25:17:13
Speaker 3
Yeah. Right.

00:25:17:15 - 00:25:18:16
Speaker 2
Every time.

00:25:18:18 - 00:25:21:21
Speaker 3
I'd rather blow it all on a Lambo then give it to the federal government.

00:25:21:21 - 00:25:25:00
Speaker 2
Yeah. Oh, my God, you're saying that for sure. The amount of business owners.

00:25:25:00 - 00:25:34:12
Speaker 1
I go talk to that are like, hey, man, you have like three brand new silverados back there. Yeah. You got new employees? No. Like, why'd you buy that? I ain't paying the government yet.

00:25:34:12 - 00:25:36:19
Speaker 2
You know, it's really Joe. What? Literally.

00:25:36:20 - 00:25:47:12
Speaker 3
It's crazy. And then, you know, if you're buying the business or selling, you're trying to back into, like. All right. So which. So Silverado is actually used for the business or not. It's not, not so clear, but, yeah.

00:25:47:12 - 00:25:54:18
Speaker 1
Yeah. Wild West man okay. So going back to that, going back to Nate there, is he he's still running or did you, did you actually help him?

00:25:54:20 - 00:26:01:04
Speaker 3
No, he's still running it. I think he'll probably run it for another year or two. And then probably try to sell it to one of his employees.

00:26:01:06 - 00:26:01:20
Speaker 1
Okay. Yeah. So

00:26:01:20 - 00:26:16:02
Speaker 1
let's talk about that first, because I think that's interesting. I think when folks go like, who the heck is going to buy this thing? Like, I don't want it. Yeah, right. That just sounds like, a horror movie every single day of the week. Yeah. Employee makes a ton of sense. Why?

00:26:16:04 - 00:26:41:08
Speaker 3
They a few reasons. One, they know the business already. They know the processes. They know why things are the way they are. And so they're less likely to kind of upset the applecart, for, for an unneeded reason, like. Well, what we see a lot of times is a more white collar buyer comes in and just starts kind of doing open heart surgery just because it looks like it shouldn't be done that way.

00:26:41:08 - 00:27:09:23
Speaker 3
And there's like, well, there's a reason it's done that way. Yeah. I think employees less less likely to do that. The other piece is they're already in the industry. So like a big issue here is you need to earn the respect of the existing employees at the business. And if you've never operated a business before or you've never operated in that industry before, the only way you earn the respect is by them coming to you after you close the deal and demanding raise and you giving it to them, then I don't even know if that's called respect.

00:27:09:23 - 00:27:32:06
Speaker 3
I think that's the more they have you kind of on the ground with their foot on your neck. And I think employees typically already have that, they've, they've spent time and then she didn't know what's going on. And I would say the third piece is it's just a less fraught transaction, like, because they already know the business and there's already, kind of basis of trust there with the owner.

00:27:32:08 - 00:27:47:21
Speaker 3
The negotiations are less intense. The owner cares about them, so they don't want to ask for such a ridiculous price that the that the employees kind of burdened by huge debt payments on a monthly basis after the deal closes. So I, I was it doesn't the top three reasons that are great regressors.

00:27:48:05 - 00:27:57:16
Speaker 1
When you have what are the things that make it tough for for someone who is an employee who's taking over, trying to get into that seat.

00:27:57:18 - 00:28:25:16
Speaker 3
There's a ton of fear. Like, in their heart. They're hard core, but they'll tell you, they're scared. You're taking on a decent amount of debt if you're if you kind of go on the SBA route. Normally they they'll have kids, too, and a spouse. So they're going home and convincing their spouse that you put a lien on the house and take out a massive personal guaranteed loan that could kind of sink the whole family's personal finances, for them to become the owner of the business.

00:28:25:16 - 00:28:53:10
Speaker 3
So I think that's that that's tough. I think a kind of another element is that they're forced to go through this crazy crash course on finance and deal making. You know, you're you're average number two, you know, general manager. Maybe they do a little bit with a pal, but a lot of it is kind of managing the crews, managing the vehicles, managing invoicing.

00:28:53:12 - 00:29:15:20
Speaker 3
That's not necessarily the same as understanding. Okay. How much should we budget to do maintenance on the vehicles? How much should we budget for bonuses this year? How are we going to deal with rising interest rates if we're in a business like, let's say, you know, property inspections where you're kind of exposed to to the real estate market?

00:29:15:22 - 00:29:34:18
Speaker 3
So they have to come up to speed on that and at the same time, understand, okay, what the hell goes into buying this business? I need an attorney. Oh, shit. The divorce attorney who lives across the street isn't going to be much help. And you put together an ally, and you deal with this bank loan. I've never done a business loan before, so it's just, like, a lot to to take on at once.

00:29:34:20 - 00:29:50:03
Speaker 3
I'll say probably that that's kind of like the second thing that that holds them back. And then the third is access to capital, which which obviously we help with. That's why I think stuff like the operator network is so important, because the best time for them to come up to speed is probably not, you know, in the 90 days they're trying to close the deal.

00:29:50:03 - 00:29:51:11
Speaker 3
It's the year or two prior.

00:29:51:13 - 00:30:07:20
Speaker 1
Yeah, I know it's getting into the system and getting comfortable and getting an idea. It's a weird you and I've talked to a couple of these second in command, I call them are like these, like elite employees. They can take it over. And oddly enough, there's like 50% of them seem to have this, like, oh, yeah, I've always thought about that.

00:30:07:20 - 00:30:23:05
Speaker 1
And then the other 50% are like, never thought about that. Actually. Didn't even know that was possible. Yeah. Do you think that's because the way these small businesses kind of run, it is typically very like founder heavy, if you will.

00:30:23:07 - 00:30:46:00
Speaker 3
I think that's part of it. I think like a lot of the businesses that we deal with, the owners have been owning them for much more than a decade. And so when you've owned the business for 20 or 30 years, your employees probably aren't thinking about you retiring anytime soon. Yeah. This is your identity. A lot of them will joke that, like, it's part of the reason they've been married for 30 or 40 years.

00:30:46:00 - 00:31:06:03
Speaker 3
They work 60 hours a week. So I think that there's some amount of that. I think there's some amount of, they're not necessarily being a playbook or an example of what they want to do. Like if you wanted to go start a technology startup, you have all of these kind of icons to look up to, for better or worse.

00:31:06:05 - 00:31:25:11
Speaker 3
If you're a number two wanting to buy out the the owner, you probably don't know that many other folks have done that. Like it happens a ton, but they're not publicized. There's no spotlight shown on them. So I don't think you have that kind of confidence that comes from looking to other people and aspiring to achieve what they've achieved.

00:31:25:13 - 00:31:47:08
Speaker 3
But then I think, third, and I think this is like a common theme through our internal culture, is that some of them shouldn't do it. Like some of them took a job, took a W-2 job, and they did it because they don't want to care about some of the things you need to do as an owner. They don't want to have the tough conversations with other employees and let them go.

00:31:47:10 - 00:32:04:15
Speaker 3
They want to be able to kind of like do quality work, count on the paycheck, and then spend time with the family or focus on faith or whatever else is in their life. And I think we are like very eyes wide open, both with the owners who we work with and, you know, operators of like, this is hard.

00:32:04:17 - 00:32:29:06
Speaker 3
A lot of suck. If you don't love the suck, don't do this. Like you're not doing us any favors. You're not doing the investors on our platform any favors. You're definitely not doing yourself for your family any favors. So I think there's some people who who are employees who haven't thought about it before. They may hear something about it, but, like, my encouragement would be, like, really think long and hard about whether you want to do it.

00:32:29:08 - 00:32:44:05
Speaker 3
It's not, you know, contrary to some of the charlatans out there nowadays, it's not easy. People do go bankrupt. People do struggle. And, and there's a lot of suck involved in, you know, being an owner operator. So.

00:32:44:07 - 00:32:47:09
Speaker 1
Yeah, not. Well, then on that note, come join the operator.

00:32:47:09 - 00:32:50:10
Speaker 2
Yeah. What exactly? If you love the suck. Yeah. No, but.

00:32:50:10 - 00:33:03:08
Speaker 1
I think that there are I mean, I mean, in a lot of these folks, I mean, a lot of folks I talk to every single day here. I mean, the team we kind of like, we all talk to them. They're like, no, man, the ground's not the problem. It's where I'm grinding. That's the problem. You know? It's not like I.

00:33:03:13 - 00:33:25:03
Speaker 1
I'm a working breed, you know? I just don't have any more patience for doing it for somebody else. Yeah. You know, or not being able to, had a teammate come in, and I can tell they can't afford their medical bills. Yeah, I'd love to front them, like next month's paycheck. I can't do that because I have like 12 series of red tape to get through.

00:33:25:03 - 00:33:28:21
Speaker 1
Yeah. So you're right. It's not the lack of grind. And there's a lot of folks who want.

00:33:28:21 - 00:33:58:11
Speaker 3
To do it, like, we're in Florida. What, a month ago? And like, Gary's son, who, moved down to Florida during Covid runs a really big plumbing business in the DC, region, started an epoxy flooring business in Florida. His number two guy that he hired down there, near Naples. One day his car wouldn't start and so he drove to pick him up and take him to the shop.

00:33:58:12 - 00:34:14:01
Speaker 3
And when he drove to pick him up, he's like, Holy shit. Like, you live in essentially a ghetto, and you have, like, a family with two kids. You've been a super loyal employee, like, screw this, you're going to move to this like fix and flip that I bought and that I was going to rent out. And I'll give you below market rent.

00:34:14:04 - 00:34:25:05
Speaker 3
So it's like that sort of stuff that you can do, if you're the owner of the business that, that maybe you can't do if you're, you know, the number two and definitely not if you're the number two of, you know, some PE backed business.

00:34:25:08 - 00:34:28:19
Speaker 1
Yeah. No doubt me. I know they don't even know how to categorize that on the right.

00:34:28:19 - 00:34:33:00
Speaker 2
Yeah. Like where is that no discretionary side. Yeah. Where does that freaking.

00:34:33:00 - 00:34:52:23
Speaker 1
Money go man. Now speaking of Gary. Like tell me there's I know you shared a few stories with me on our on our last trip to, on our trip to El Paso, just about some of the, some of the characters that are out there. Yeah. But also just what makes our country so daggone interesting, man. Like in the, in the, in the middle parts of between Technology and Wall Street.

00:34:52:23 - 00:34:55:15
Speaker 1
Right. Any of them favorites come to man?

00:34:55:17 - 00:35:13:13
Speaker 3
I mean, I think, I think the common theme that I found is right now buying a business is kind of a meme, like a bunch of people want to do it. You probably shouldn't want to do it. What that means is all these people are trying to get in contact with owners, and it's hard to get in contact with, with, with owners, much less the ones that have good businesses and at first over a buffet.

00:35:13:13 - 00:35:34:19
Speaker 3
But if you earn their respect, they won't let go of you. So like, for instance, Mark Martin, there is another one of our clients. There's a ton of stories about him. One of one of the ones I'll share is, after he sold his business and, his wife, and he were going on, like, cross-country trips, and he knew that I used to live in New York.

00:35:34:21 - 00:35:38:18
Speaker 3
So one day I get, like, two missed calls from Martin. I'm like, what the hell does he like.

00:35:38:20 - 00:35:39:19
Speaker 1
Then go to he's.

00:35:39:21 - 00:35:40:04
Speaker 2
Supposed.

00:35:40:04 - 00:35:58:04
Speaker 3
To be here, retired, answer the phone and say, well, and like, yeah. Martin. He's like, I need your help. I'm sorry. What do you want? He's like, I'm in. I'm in downtown Manhattan driving the F-350 super cab. And where the hell do I park this thing? I was like, dude, I don't know, like Google Maps. I don't like tri port authority.

00:35:58:06 - 00:36:00:18
Speaker 2
You're the only one in town with one of these right now. Yeah, it's.

00:36:00:18 - 00:36:19:04
Speaker 3
Seriously, and so you're just kind of like, once you become friends with them is what really happened. When once you work with them and you gain their trust. And Gary is definitely one of those people as well where, you know, chat with him a good bit. Saw him down. We went down to Florida, which is great.

00:36:19:06 - 00:36:31:15
Speaker 3
And now his son, he's now advising operators to the operator network. His son is thinking about transitioning his business to be owned by an operator, probably through our network, which is really cool to see. It's kind of full circle.

00:36:31:15 - 00:36:33:05
Speaker 1
Yeah, man.

00:36:33:07 - 00:36:57:21
Speaker 3
So it's just nice to kind of hear their hear their stories and stay with stay in touch with them over the years. And, they, they keep text in you and whatnot. So, I mean that the, the internal, main share stories go on. But I'm trying to think, you know, the ones we can share. One was of one of our colleagues, his, high school son went down to, port A, which is the beach down in Texas, and gotten a little bit of trouble with the cops.

00:36:57:21 - 00:37:18:10
Speaker 3
He was underage. And, sure enough, our team, they didn't call a personal friend down there. They called a client and said, do you know who the hell can bail my stepson out of jail? And, you know, they delivered, so, you know. Yeah. You, they stick by you once, once you, kind of break through that, steely, steely eyes.

00:37:18:12 - 00:37:36:03
Speaker 1
It's total, rather die mentality, which I think is, is it takes a bit to get there. But what makes this job so, so fun and what makes it so hard for folks that I probably get every third conversation, every second conversation? I'm sure you do too. Well, where is they go? How do you even get a hold of these owners?

00:37:36:03 - 00:37:40:11
Speaker 1
Yeah. And when I get Ahold of them, like I can't keep them on the line for more than a minute or two.

00:37:40:11 - 00:37:41:01
Speaker 3
Yeah.

00:37:41:03 - 00:38:07:05
Speaker 1
And you recognize it? It's got to be like they don't see anything you're talking about as, like a as a sales thing or an opportunity to whatever it might be. I was actually thinking about it the other day, too. If you meet most of these business owners, most of them that have been around for a long period of time, in a weird way, they're not they're almost not even trying to get the highest dollar or any dollar for their business sometimes because, like, they've been pretty good savers, they figured out how to like, deal with their cash.

00:38:07:05 - 00:38:15:02
Speaker 1
In a lot of ways, they've kind of just had it set. So it's really gotta be the right dude or dude that comes through the door that makes him go like, okay.

00:38:15:04 - 00:38:26:00
Speaker 3
Yeah, yeah, I think that's true. I think also like they want a fair price if, if they're selling to like a great operator, they just want a fair price. Yeah. If they're selling private equity, they're like, fuck you.

00:38:26:00 - 00:38:27:22
Speaker 1
Like Jack and everything.

00:38:27:22 - 00:38:50:17
Speaker 3
You I mean, we had this one guy who had a big commercial cleaning business. They did a bunch of contracts in Vegas. SeaWorld, and I remember he he he started his private company shop. Hopefully, I'll say vague enough. And, they, they didn't treat him very well after the sale, but as soon as the sale closed, he went and just bought it.

00:38:50:17 - 00:39:10:22
Speaker 3
Rolls. I was like, all right, dude, whatever the fuck you want to do, that's what you want to do. And the the funniest part to me of the whole transaction was these guys were trying to do a shitty, like a quality of earnings where you try to verify, you know, how legit are the earnings and they got on the phone with his accountant, and I was on the line at the time as well.

00:39:11:00 - 00:39:31:22
Speaker 3
And it was this Jewish accountant out of Vegas. Go must been like 70 years old and his name was Sandy. And they're like, so like, how do you allocate the operational expenses? And like, no, the Cogs are legit, blah blah. It's like, well, he comes in every year with, you know, eight and a half by 11, sheet of paper writes down his op x, I enter him in the tax returns and we call it.

00:39:32:00 - 00:39:46:14
Speaker 3
And these guys were like, well, wait, this business is worth $12 million. And that's how you file your taxes. And sure enough, it was. And then the question is like, are you going to buy the business or not? And they ultimately did, and they made a great return. They didn't treat, the owner too well during the earnout period.

00:39:46:14 - 00:39:50:06
Speaker 3
But, you know, that's the, private equity story.

00:39:50:08 - 00:40:07:23
Speaker 1
It's kind of why we want to keep these things local if you can, man. For sure. When you think about, I want to hop back a little bit into kind of small business America. But before we go there, like, speaking of, we've kind of mentioned it a few times on the on the money side of things. Yeah, you kind of think about it from the context of a mortgage or something.

00:40:07:23 - 00:40:29:19
Speaker 1
Folks go, yeah, I'm going to have if I ever wanted to do this, probably have to have some money down to be able to go do this. And quite frankly, I don't know, like if that business is worth 5 million bucks, I'm never going to be able to save a million bucks for that to happen. What some of the things you can kind of break people's minds on like, hey, like if you ever thought about considering this and being an owner operator, here's some things, not here's some new things to take with you.

00:40:29:20 - 00:40:30:14
Speaker 1
Nuggets. Why?

00:40:30:14 - 00:40:57:23
Speaker 3
Yeah, well, we've helped people buy businesses of 15 K to their name. So, I don't think that, money should be the issue. I think there are a lot of investors out there who are who believe in small businesses as an asset class, who see the opportunity to invest in and are excited and who are patriots. I think they they are willing to back, hard working, you know, folks and and bet on them.

00:40:58:01 - 00:41:16:20
Speaker 3
So I don't think that that the absolute dollars are should be the barrier. You need to have some money because you need to essentially tee up the deal to happen. Meaning like if you need an attorney, you got to pay the attorney's retainer, you got to pay the, you know, loan application fee. You can't be raising money for that piece.

00:41:16:22 - 00:41:39:09
Speaker 3
If you are the investors take will be like, hey, if you don't have 15 K to put behind this thing, are you great at managing your money? Should I trust you with corporate finances? Which may be right or wrong? But but that's definitely how they, they look at it. So I would say like, you know, you can go and get a $5 million SBA loan with, no personal net worth behind it.

00:41:39:09 - 00:41:53:06
Speaker 3
If you have. Good figure. You need other pieces, right? You probably then need a seller of a business who's willing to sell or finance a good piece and put it on standby during the life of the loan. I know these are technical terms, but luckily Jax operator Network.

00:41:53:06 - 00:41:55:04
Speaker 2
Will explain them all.

00:41:55:06 - 00:42:16:02
Speaker 3
So you need kind of the seller to play ball with you, or you need investors to play ball with you. Or ideally, in our view, kind of both is probably the right mix. But, you know, money isn't the barrier. I think the barrier is someone who understands what they're getting themselves into, who's high character or who is committed to, like, compounding themselves as an individual.

00:42:16:04 - 00:42:35:16
Speaker 3
You know, we look for folks who have read five books in the past six months, related to what they're interested in. That's a great proxy for someone who invests in themselves, because, you know, time is the, is a scarce commodity. So I'd say, from that perspective, there's a lot of different financing resources out there for, for great operators.

00:42:35:20 - 00:42:53:02
Speaker 1
Yeah, that's something that don't they don't talk a heck out. I don't remember a single class on like grit and character. And it's funny how much we talk about that here in this office. I was up in Waco with Chris, one of our, advisors. We're going through the whole stack about, you know, things he can advise on, kind of his masterclass, kind of.

00:42:53:02 - 00:43:12:15
Speaker 1
So to speak. And I remember, we grabbed grabbed a bite to eat afterwards, and he goes, dude, look, man, like, make sure they got a baseline business acumen. But at the end of the day, like, whatever it takes, figure out how you determine grit and character. Yeah. And his exact words were make them tell you something really freaking hard.

00:43:12:15 - 00:43:28:13
Speaker 1
They've done like really hard. Yeah. It goes. And then I'll talk to them. Yeah. And I it gives if I believe that it actually was tough and they actually had to like scoop out of that thing. Sure. Why do you think that's just such a common drumbeat? And we say it and I think people listening in right now might go like, okay, yeah, yeah, cool, cool cool, nice to have.

00:43:28:13 - 00:43:35:19
Speaker 1
And they go right back to the numbers. Yeah. When if anything, you just finish saying numbers don't really matter that much. Is all this other stuff.

00:43:35:19 - 00:43:51:17
Speaker 3
Yeah. I think like the cliches saying is like change is the only constant thing in small business. It's like, shit show is the only constant, things just always go wrong. Like they're always going to go wrong. And.

00:43:51:19 - 00:43:52:12
Speaker 1
You can't hide.

00:43:52:17 - 00:44:19:00
Speaker 3
You can't hide and you want someone who is capable of just pushing through. And you want someone who doesn't get, like, demoralized by it. They're just kind of like, all right, this is what I signed up for. Let's let's go. So I think that that's one piece. I think the other piece also, that's not necessarily great, but more on the character pieces, frankly, in small businesses, a lot of opportunity to do things the wrong way.

00:44:19:02 - 00:44:37:10
Speaker 3
You're small enough business that the regulators, the power that be, they're not necessarily looking at your business, whether that means auditing your taxes or if you're in an industry, you know that, the state agency looking into whether you're doing things, the code, whatever it is, and you want people who are going to do it the right way.

00:44:37:12 - 00:44:58:01
Speaker 3
And you want people who, when no one else is watching, they're doing the right thing because, frankly, you are putting a decent amount of trust in them. If they wanted to defraud their customers, their investors, by law, there's going to be opportunities to do that. And you want people who, have a good moral code who think long term, you know, that's not that's not in their DNA.

00:44:58:03 - 00:45:13:01
Speaker 3
So I think that's another piece. And, and, and I would say the last is it more than like, let's fast forward for 15, 20 years and say the eye takes over the world. Most of these trades businesses are still going to be there, and they're going to be there because they require humans and it's a people business.

00:45:13:01 - 00:45:31:12
Speaker 3
And, when it's a people business, your character matters a lot more. And how you interact with people and how you present yourself and how you're empathetic, like Patrick, another, advisor in the network went so far as to set up a school, not to teach people how to be Hvac techs, but to teach them how to deal with customers.

00:45:31:14 - 00:45:49:01
Speaker 3
And like, that's like, so on the money. Yeah. And so I'd say from from even just like being a good business owner, let's say that you're ethical and you have hard, hard, work ethic and, and whatnot and grit, you still got to be able to, you know, delight your customers and, you know, make them want to come back for more.

00:45:49:06 - 00:46:01:22
Speaker 1
Yeah. It's such a hard thing for us to not prioritize in our day to day. But then you think about if we can all, like, personalize it and go. My wife had to wait at the house this morning for someone to show up.

00:46:01:22 - 00:46:02:12
Speaker 3
Yeah.

00:46:02:14 - 00:46:19:08
Speaker 1
And if that if she was, if she's smiling when I get back home because she had a really pleasant experience with, like, a really professional individual who try to respect and whatever. Yeah. Do we're not hiring anybody else. Totally. That person comes every time now. Yeah. Right. And I think it's those things that, you know, we spend a lot of time on, like new customer growth.

00:46:19:08 - 00:46:29:06
Speaker 1
These business owners are getting a lot of the MBAs come down and go like growth strategies. And they almost forget like what about retention strategy. Right? Right. That's super. Especially with these businesses that are just humming cash.

00:46:29:06 - 00:46:50:14
Speaker 3
Yeah. Or the ones who, you know, focus on growth. It's all marketing and fancy CRMs and automations. It's like, no, dude, the business hasn't called, it hasn't done cold calling ever. Maybe start by getting, you know, a nice young college grad to call around and see if they can get some more customers. That's probably number one. Not yeah.

00:46:50:18 - 00:46:53:20
Speaker 3
You know, installing your, you know, fancy software.

00:46:53:20 - 00:47:17:05
Speaker 1
So yeah. No I'd I'll give you a scrappy one that one of our advisors was actually Patrick. He So Patrick, if you're listening in, man, I'm giving one of your secrets away here. But he was like, look, man, you know how I grow my business. I go out, he goes, I look at he looks at, anytime he's about to make a new acquisition, he looks at voicemails unanswered, like that's a metric he looks at.

00:47:17:05 - 00:47:31:05
Speaker 1
And you go like, I bet, you know, private equity KPI anywhere, any out there looking at voicemails unanswered and he goes, it's easy. Just look at call logs and you just like, literally he goes, even if you get a man, you made it. You look at a small shop and you go, okay, on average, 15 calls a day unanswered.

00:47:31:07 - 00:47:48:05
Speaker 1
Yeah. And so he literally adds a metric to that. And he goes, my growth strategy next year is literally just answer all those calls. Yeah. And it's just a it's that kind of stuff that makes someone successful in this game versus someone who's just thinking about, like, if they use the words I or paid app marketing or Google ads.

00:47:48:05 - 00:47:50:05
Speaker 1
Yeah, it's just a little bit like, good luck, man.

00:47:50:05 - 00:48:09:18
Speaker 3
Yeah, totally. Yeah. I think there are a bunch of those type of like hidden secrets that from the outside looking in, people don't pick up on, like one of the ones that we found, specifically in the trades, is that the best companies that owners invest in really nice trucks for their crews.

00:48:09:20 - 00:48:10:12
Speaker 1
Oh, interesting.

00:48:10:13 - 00:48:30:14
Speaker 3
And they're like, look, these guys are spending eight, nine, ten hours a day in them. Oftentimes they're taking them home. They're not leading them on the company a lot. Like make them proud. If you make them proud, they're going to do great work. And I think that's, like, entirely true that, you know, we've I've yet to see a I'm sure one exist, but I've yet to see a shitty business who hasn't invested.

00:48:30:16 - 00:48:34:18
Speaker 3
Well and, you know, and their in their equipment.

00:48:34:20 - 00:48:39:06
Speaker 1
And you found most of them are letting them use it for personal stuff, too. They need to,

00:48:39:08 - 00:48:59:19
Speaker 3
They have to pay for their own gas if they're using it. I don't think necessarily that they're using it a ton for personal, but I think it's more so like you want to feel proud of the of the business that you work for. And if I give you, you know, a new upgraded truck every 3 or 4 years and, it's not scratch, it's not dented.

00:48:59:19 - 00:49:20:11
Speaker 3
It's not like old tech inside the car. You're going to be, more satisfied. Like I Google, they let you do a scooter around the office and get, you know, free mojo or whatever, but for for for these businesses, it's like, let's get a really nice truck that this guy is going to spend, you know, hundreds or thousands of hours in a year, make him feel comfortable, make him feel proud.

00:49:20:13 - 00:49:38:07
Speaker 3
Give him the latest kind of gizmo, and he's going to go do great work, and he's going to be, you know, in a good mood when he gets in in the morning. I think that's really true. And I think the other thing that we've also noticed is probably more recent is, we've been hanging out with a bunch of owners and, and person all across the state.

00:49:38:08 - 00:50:00:06
Speaker 3
The companies that have swag. We were down in, an a different trip to Florida. It's a really cool electrical company. And they have these, like, neon green, like really cool designed, polos, like golf shirts, that they all wore. And then every couple weeks, they'll go out, for fishing trips that the owner said was mainly boozing trips.

00:50:00:06 - 00:50:17:23
Speaker 3
But, they allegedly did some fishing. I do think it's just that type of like culture that also gets back to why keeping them locally owned and operated so important, like you're not going to get that, in these businesses that are kind of owned by big conglomerates and whatnot, there's just not that level of of it caring about the other people on the team.

00:50:18:05 - 00:50:32:09
Speaker 1
Yeah. No, it's and if you haven't experienced it, I think it I mean, that's a good thought here. Like if you haven't experienced that feeling because for some folks brought ten and in right now they're going like, yeah, I don't know if I want that or not. The funny thing is I will I guarantee you, you want that.

00:50:32:09 - 00:50:51:17
Speaker 1
I feel that way here all the time with the team. What do you any advice you'd give to somebody who goes like, look, if you if you don't know what I'm talking about, do this before becoming even an owner and see if you can get some exposure to, like, the way that feels, because it's like family meets locker room meets something, something special going on that you're describing.

00:50:51:23 - 00:51:07:08
Speaker 3
I mean, I think the, the easiest one is when you go drop your car off to get worked on, just stay in the shop for an extra 15 minutes. Yeah. And just see how those guys talk shit to each other and care about each other. Ask about their family lives, but still talk shit to each other.

00:51:07:09 - 00:51:21:11
Speaker 3
Yeah. I think that's probably the most, accessible way to kind of see how these businesses operate under the hood. Yeah. And it's just, like, cool to see they care. They care about each other, you know?

00:51:21:13 - 00:51:40:19
Speaker 1
Yeah. It's, Yeah, there's some you can tell there's like a, like a blood bond. Yeah. That happened. Yeah. And I think the right owner or new owner coming in can like, be really cool. Like older brother, older sister figure. Yeah. To these folks. And I don't know that we always value how good that can feel. Totally.

00:51:40:21 - 00:51:59:15
Speaker 3
And like one of the strategies I've seen, on the for new owners of a business is to send around a survey after the deal closes of like, what are the three things that you wish were different about the company?

00:51:59:17 - 00:52:21:10
Speaker 3
Oftentimes they had respect for the old owner, but they were probably a little stubborn. And there's some really simple things that can make their lives better. So like one of the examples of, of a buyer that we worked with, sent around a similar survey, got answers back from the employees that it was all about when they sent the schedules out for the next day.

00:52:21:12 - 00:52:41:19
Speaker 3
So previously, the old owner would, you know, get back from working around 6:00, 7:00, have dinner, watch an hour of TV, with his wife, and then do all, like, the route planning of, like, who's going where tomorrow. And so what that meant for the employees is like, oftentimes it was sent out at probably like 11:00 midnight. They would already be asleep.

00:52:41:19 - 00:52:57:16
Speaker 3
They'd open it first thing in the morning and they'd be like, shit, I need to like, change my childcare because I got to leave 30 minutes early or something like that. And all they wanted was like, hey, man, when you get home, can you please just spend 30 minutes and do this before you eat dinner? And he did it and they were thrilled.

00:52:57:18 - 00:53:14:13
Speaker 3
There was another thing that the owner did in that transaction, that originally the buyer was going to change and realize that, was on purpose, which was that every two weeks he would have everyone come over to his house to get their pay stubs, to get their checks. And at first he's like, what the hell are they doing this?

00:53:14:13 - 00:53:31:08
Speaker 3
Like, just put this on like an internet platform where we can manage payroll automatically. Like, this is super, silly. What? It turned out what happened is everyone show up at the same time, have 2 or 3 beers together. And it was kind of their way of, like, blowing off some steam and hanging out every two weeks.

00:53:31:10 - 00:53:40:01
Speaker 3
And so some of those rituals that, like, from the outside looking in, it's like, oh, this is kind of the old school non-tech way to do it. It's like, well, maybe there's another reason that they do it that way.

00:53:40:04 - 00:53:58:21
Speaker 1
Yeah, there's something you can that's something you don't find, in a corporate setting very much. Have you ever thought about that? Like when you leave, let's just use Apple. If you were working at Apple and then you leave, you have zero relationship with that individual. It's why I think actually former military makes really good operator candidates as well.

00:53:59:00 - 00:54:17:00
Speaker 1
Yeah, because they're used to being like my friend group is also my work group and my families are my wives and husband. Everybody hangs out together. All the kids go to school together and everything else. And that's like how these businesses are totally. Everybody just knows each other. What are you doing Saturday? Yeah, technically, coming back to work because we're going to a barbecue.

00:54:17:05 - 00:54:28:17
Speaker 3
Yep. Yeah, totally. I think it's it's uncommon to find in kind of typical corporate America. I think there's some, some companies out there who pull it off. But but most of them don't.

00:54:28:19 - 00:54:49:13
Speaker 1
Yeah. Give me I know a random bases here. So in that day on our own went by fast and, it always does. Just the optimist in you looking at small business in America. Yeah. You know, where there's a lot of talk of a lot of the things we kind of cover this at the beginning. But what what makes you hopeful just about what the future holds?

00:54:49:13 - 00:55:01:18
Speaker 1
Even though I know we're all trying to do our best to get more operators and to be encouraged to become future owners, whether it's the talent or whether it's just where economically things are headed or whatever. Like what are the things that keep you hopeful?

00:55:01:20 - 00:55:24:05
Speaker 3
I mean, I think the like, general spirit of Americans is still there. And like, my kind of like personal memo is either like fight for the future you want or shut up, you know? So like, I think I'm by and large, my take is there are just as many hardworking, high quality Americans out there today as there have been in the past, or probably more.

00:55:24:07 - 00:55:45:18
Speaker 3
There are also some absolute crazies out there, and you can either do nothing and complain about them, and let them kind of soak up the airways and, and kind of with the country into the version of the world that they want it to be. Or you can go out there and, and fight for the future you want until like, for me, I think small businesses is like the best way to do that.

00:55:45:20 - 00:56:08:09
Speaker 3
I think that, you know, your average small business owner is a realist. They're a character. They care about the people around them. And, you know, creating more small business owners and more success stories and kind of middle America is how we kind of keep this company or this country rather. Both. Yeah, both going in the right direction.

00:56:08:11 - 00:56:28:10
Speaker 3
So like, that would be my take, I think, like, you can make some interesting arguments that like probably the last shoe to drop if these I overlords take over is, you know, small service businesses. So it's kind of like there's a world in which the engineer gets automated before the plumber does. And I think that'd be pretty ironic and pretty hilarious.

00:56:28:12 - 00:56:52:22
Speaker 3
But I mean, some people, think that kind of the days of these businesses are coming to an end, and I think, like, they will never come to an end until the spirit comes to an end, which sounds kind of like, you know, fluffy and silly, they say. But a lot of the reason these businesses were started is that someone had a work ethic and a streak of independence and a streak of like, I'm going to do things my way.

00:56:53:00 - 00:57:17:20
Speaker 3
So they started a business and that's how they express it. And I think as long as we nurture that kind of fire, small businesses will be thriving and there'll be more and more each year. And it dates, like all the way back to, the country's founding. Most of the signers to both the Declaration of Independence and, the Constitution were small business owners or sons and daughters, actually, no daughters, sons of small business owners.

00:57:17:20 - 00:57:32:07
Speaker 3
So, I think that that streak, I think will keep alive. And the funny thing is that the more immigrants that come here, the more it helps our case, because they're typically, you know, starting small businesses and they get here.

00:57:32:07 - 00:57:34:12
Speaker 1
Yeah. I'm really daggone good at it, man. Yeah.

00:57:34:12 - 00:57:35:21
Speaker 3
They grind, they grind.

00:57:35:21 - 00:57:44:15
Speaker 1
It's a humility to you, right? Like, that's the thing that's hard to teach. I think it's just like not being, not title chasing.

00:57:44:17 - 00:58:07:04
Speaker 3
Yeah, not title chasing. And like, I think that a lot of Americans are that way too. I just think that kind of the internet and media and whatnot is taken up by people who are a bit bit crazy and, you know, have lost touch with reality. But like when I go back home, most of, my friends are, as I said, kind of involved in small businesses.

00:58:07:04 - 00:58:15:23
Speaker 3
And they're all very reasonable human beings. And Greenville, North Carolina isn't the coolest city on, planet Earth. And there are a lot of, cities that look exactly like it.

00:58:15:23 - 00:58:43:06
Speaker 1
So before we leave, and what if anybody listening in right now tuning in, and I'm hoping it's I'm hoping it's everybody. I mean, just people who want to, like, nerd out about what's going on in the world. But for somebody going like, man, okay, I never thought about owning a business like. Who do you think is probably the right candidate out there for business ownership in the newer generation, so to speak?

00:58:43:08 - 00:59:01:03
Speaker 1
Millennial X and millennial x X, millennial Z. Yeah, that ought to consider it. But right now I probably haven't even consider like, do you think about certain? Do you think about certain groups of folks that you go, I bet you they're not even thinking about it. But if they had. Yeah, let's get them in.

00:59:01:05 - 00:59:20:02
Speaker 3
I think they're definitely like patterns. I would say like folks who are athletes before even in high school, like you've gone through a bunch of pain repeatedly, you're probably going to be pretty good at, you know, operating a small business. You probably have some amount of leadership and if not leadership, at least teammates skills. Yeah. Armed services for sure.

00:59:20:02 - 00:59:47:05
Speaker 3
I think that's another one. But but I don't think I think there are a lot of people out there, who may not fit a specific mold. They're not like the corporate refugee or the person leaving NBA or the person leaving the service or whatever it may be. I think, like, generally speaking, someone who has who's like more of an endurance athlete than a sprinter who's in it either for the freedom or the long term wealth, but has some mechanism like delayed payoff.

00:59:47:10 - 01:00:06:00
Speaker 3
Yeah. And then I think it's someone who's somewhat curious as well. Like always kind of curious about how things work, how I can be better. It's kind of relentlessly self-improving. I think if you have those three things, everything else, you know, takes care of itself. And we can we can help with a bunch of it, too.

01:00:06:02 - 01:00:21:02
Speaker 1
Yeah. No, we can't, man, is. Yeah. You kind of. There's a there's a, like, a, a mindset. You might be like, if you find yourself kind of being slightly the awkward person at the group combo because you just kind of think about things differently than everybody else. Yeah. Yeah. We probably want to talk to you. Yeah. Yeah.

01:00:21:04 - 01:00:33:14
Speaker 1
Well, man, so good to have you on me. And I know we will have many more of these in addition to all these great guests that we're going to have and just things, I think for folks to stay tuned. There's some really good characters in this company, and just being able to riff.

01:00:33:15 - 01:00:36:00
Speaker 3
I mean, you know, it will only get better than this episode.

01:00:36:00 - 01:00:39:11
Speaker 2
So I think everyone here will think.

01:00:39:12 - 01:00:45:00
Speaker 1
We set the bar low. I think we set the bar fairly high. It means that we only have good staff. Well be. I appreciate the time.

01:00:45:00 - 01:00:46:11
Speaker 3
Lucky to have you here too, Jesse.

01:00:46:11 - 01:01:02:12
Speaker 1
We're. Oh, I'm stoked to be here, man, I couldn't I mean, this is it's not even a job. I don't even know what to call it. It's definitely a calling. And I think beyond calling, I just like, if you're like, I'll put this out there if you're in Austin, Texas. Yeah. Look for the flags.

01:01:02:14 - 01:01:04:04
Speaker 3
Come see us, come see us.

01:01:04:04 - 01:01:05:15
Speaker 1
There's an energy in this place right here.

01:01:05:15 - 01:01:06:13
Speaker 3
We had bourbon for you.

01:01:06:13 - 01:01:11:22
Speaker 1
Yeah, that's exactly right. Yeah, we we have it delivered by whoever delivers every.

01:01:11:23 - 01:01:12:21
Speaker 2
Oh, is that right?

01:01:12:23 - 01:01:15:02
Speaker 1
Okay. Now you know, man there, you know. Well.

01:01:15:02 - 01:01:17:20
Speaker 3
Thanks, man. Yeah. Thank you. Anytime. Oh,

01:01:17:20 - 01:01:43:18
Unknown
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