#14 This Operator Bought a Plumbing Company for $1.9M (Here’s What Went Wrong)

📉 Lessons From the Trenches: The Real Cost of a $1.9M Plumbing Acquisition
 In this brutally honest episode of Owned and Operated, John sits down with Jameson Wildwood, who bought Sweetwater Plumbing in North Carolina for $1.9 million. Six months post-close, Jameson reveals what actually happened—from bad deals and cultural clashes to scaling a service division 5X in half a year. If you're eyeing a plumbing or trades acquisition, this one’s a must-watch.

💡 What You’ll Learn:

• The hidden overhead costs of running a new construction plumbing business
• Why service and construction are two separate businesses under one roof
• How culture clashes can sabotage post-acquisition transitions
• Jameson’s hard-earned lessons about brokers, sellers, and negotiation power
• What it really takes to build a profitable service division from scratch
• The role of marketing, CRMs, and quality-of-earnings in avoiding post-close regret

Jackquisitions Newsletter — Your favorite source for how to buy small businesses. Real insights, smart strategies, zero gurus.

🖊️ Sign up HERE for more insights

💼 Shoutout to Quick Staffers LLC
 Hire trained HVAC & plumbing CSRs at a fraction of the cost.
 🔥 $1,000 off your first placement

🎙️ Host:
Jack Carr

🎙️ Guest:
 Jameson Wildwood 

Jackquisitions Newsletter — Your favorite source for how to buy small businesses. Real insights, smart strategies, zero gurus.

🖊️ Sign up HERE for more insights


📢 Enjoyed the episode?
 ✅ Like, Comment & Subscribe for weekly insights on business acquisitions, deal flow, marketing, and growth strategies!

📌 Disclaimer: Some links may include UTM parameters or affiliate relationships, meaning we may earn a commission if you make a purchase. Episodes may feature sponsors, but all opinions expressed are our own.

Transcript

JackQuisitions Episode 14 Transcript

Jameson Wildwood: [00:00:00] I made an offer on this company for $1.9 million. That's a lot of money for a plumbing company. He was constantly trying to nickel and dime me for stuff. Surprise, surprise. The sell was not my friend. The broker was not my friend. You're 

Jack Carr: running a service business. And you're running a construction business.

What did you wish, you know when you were buying the business and acquiring it? 

Jameson Wildwood: I wish I understood exactly how much work it is to manage new construction. And how's that been going? It is hard though.

Jack Carr: Welcome back to Jack Acquisitions. I am super excited. I have a. I think I, I, I call his friends Jameson. I have friend, a friend Jameson, uh, who has acquired Sweetwater Plumbing about six months ago, and he has a really interesting story. We're really excited to, uh, well, interesting. For the listeners, maybe not so much for you Jameson, for anyone not watching.

He, he, uh, he gave us a smirk, um. But yeah, Jameson, tell us a little bit about yourself, the background, and then what got you into [00:01:00] acquiring businesses. If you like what you heard and want more content like this, head on over to jack acquisitions.com or click the link below to sign up for the weekly newsletter.

Jameson Wildwood: My name is Jameson Wildwood. I am your recent new owner of Sweetwater Plumbing and Apex, North Carolina. Um, about a year ago I started getting into this acquisition space. I listened to all the podcasts. Um, Jack Acquisitions was not online back then. Yeah. But, um, there were other ones to listen to. I wish, I wish You were, because, um, I would've learned more about sort of the plumbing and home service space and probably have done some things some differently and we'll, we'll cover those as we get there.

Um, specifically around new construction and service. So there's some lessons around there. Mm-hmm. But, um. I was a middle manager in it, uh, basically ran a company or ran a department of about 30 people and thought that those skills of management and everything else would probably do pretty well in the acquisition space.

I didn't want to go any farther up the corporate ladder and keep seeing like [00:02:00] 3% raises year over year and mm-hmm. More and more meetings, more and more disconnection from what's actually happening. Um, you know, into the sort of junior VP and middle VP and all that space. I just, I just got bored of it and yeah.

Um, I learned about this thing called acquiring a company and, um, I had some capital saved up from long years of slaving away in the corporate corporate space, and I thought that that could be an interesting way to reengage myself with work. And, um, make something that's really special and also just sort of secure financial freedom versus the sort of standard three, 4% raises and maybe I get a promotion if I'm a good person or, or whatever they, they justify promotions are in the big corporate companies.

Jack Carr: Yeah. You know, I think that a lot of people share that sentiment. It's, it's an interesting new wave of, of an ideology. What. Got to me as well was, you know, I was putting away a little bit here and there for retirement and just watching that account slowly grow and going, man, this just doesn't [00:03:00] feel like my 401k just doesn't feel like what I could actually utilize that money for.

Did you, did you get that feeling as well? 

Jameson Wildwood: Oh yeah. I mean, you know, I, I got bored and I dabbled and traded in stocks for a while and realized that that was mostly a terrible idea. Um, and I was just, it felt like. I was elbowing this, the glass ceiling, a glass cage of corporate culture. And like I could be so much bigger than this.

I could have so much more difference than in this corporate job. And, um, maybe many of you were feeling this, but in the tech world, about a year ago to about two, two years ago, to about a year ago, there was, um. Tech jobs were hard, like it was a hard space for tech. It was hard to find good tech jobs. Um, I was applying to other companies and finding only offers that were at or below.

My current sort of working salary and working level, and that was just not appealing at all. Um, and so that's kind of when I started to look for alternatives and found acquisition space and then really just dove in [00:04:00] head first and listened to all the podcasts, read the books. I read the, um, the Harvard book that they all talk about.

Jack Carr: Yep. 

Jameson Wildwood: Um, that sort of gave me the like, oh, this, I could do this thing. And started just reaching out to brokers, looking at offers. We looked. Um, probably at six or seven companies somewhat seriously before, uh, submitting an LOI for one, didn't get approved. And then I finally found Sweetwater Plumbing and submitted an LOI for that one.

And, uh, really started down the path of evaluating this company. It felt really good here. Just like, oh, it's a plumbing company, it's here, it's local. Um, the seller felt like a really honest guy. More about that later. Um, um, so yeah, just kind of went. Dove headfirst into this thing and kind of felt like Sweetwater was my one and I was, I was gonna make it work.

Jack Carr: I love it. I, that's a very similar story to many people I talk to as well as myself, and I think that that's huge. Um. [00:05:00] Extremely interesting. And I think that that's where we try to differ a little bit on this podcast. Yeah. Uh, versus some of the other ones that you could find with like the Cody Sanchez is there's a lot of gurus out there talking about how great everything is and how easy this acquisition space is.

And you No. You know, you hire, you, you buy it, you put an operator and you start marketing. No, but like from what I, I've heard so far, like we are one of the only people that go through and, and we're like, Hey. Let's break down why these, this is bad. This is bad. This is bad. This is bad. And so, so you know, you laughed at, um, one of the things that I harp on, I harp on it with Chris Barr, I harp on it here.

It's like the owner is not your friend. No, he's not. They can be. But while you're in the acquisition process, you guys are directly. Adversarial in the sense that anything he misremembers or she misremembers, um, is going to [00:06:00] be significantly. Valuable to them. Meaningful, 

Jameson Wildwood: impactful. 

Jack Carr: Yeah. And, and, and hurts you personally.

Yes, it does. So let, let's start. Uh, I think there is, is, hey, so you laughed about that. Did what, what are some of the big lessons that you took from kind of that initial acquisition, specifically relating to like the owner relationship? 

Jameson Wildwood: Yeah, so I, I coined a term early on called Seller Scrooge syndrome where, uh, you know, I made an offer on this company for $1.9 million.

Right. That's a lot of money for a plumbing company. 

Jack Carr: Mm-hmm. 

Jameson Wildwood: Um, and yet through the deal process, he was constantly trying to nickel and dime me for stuff. Make me pay this little fee, make me pay his lawyer to do this little thing, which he was demanding and I didn't really need. There was, there was an escrow in there for some fee that he wanted me to pay his lawyer and then pay the lawyer's fee for that escrow.

And I'm like, dude, like this is 500 bucks and you're pushing me to get $500 outta a [00:07:00] $1.9 million deal. Really? And there was a number of these little scenarios where he was just trying to nickel and dime me and stick it to me every single time there was a negotiation. And, you know, one of the lessons I learned, in fact, I talked with the broker who helped, the seller's broker, who helped me through this deal after the deal, about three months after we closed, and this, the, the broker disclosed to me that the seller had disclosed to him that he was like, well, let me see how I can get, how much I can get out of this deal.

Right? And so the seller was really pushing hard to get like every little penny that he could. And even tell the broker that, and of course as you say, the sell was not my friend, the broker was not my friend. Mm-hmm. Right? They're just trying to get every little penny out of me as possible. And there was even a couple scenarios where the two brokers at the brokerage firm played a little good cop, bad cop on me.

Um, so you gotta watch out for that because there was a couple times when I was hemming and hawing over this like, [00:08:00] that doesn't make sense. Why are we negotiating this? Why is this taking a week to negotiate this stupid accounts receivable deal? Mm-hmm. And then the seller's broker, the other seller's brokers, because there's like two of them on the team there, kind of gave me the like, well, Jamison, come on.

It's time to step up to the plate. Let's go. And it was seriously high pressure to continue the negotiations, even though I was like, this doesn't 

Jack Carr: feel right. Did you feel during that process, like everybody was overly incentivized to get the deal done, not necessarily get the right deal done for you? 

Jameson Wildwood: Oh yeah.

Oh yeah. Totally. Like when I was in it, it felt like just this giant water slide heading towards the end. Mm-hmm. And there was definitely negotiations and bumps and turns in the road, but. Um, there was a lot of pressure to keep rolling, to keep going, and internal pressure too. I wanted to get the deal done.

Um, yeah, I didn't wanna wait too much longer, um, to, to get it done. And I thought that [00:09:00] getting it done sooner was potentially better for me because at the SDE that we're talking about, which we came to a SD, about 680 k outta everything, like if I wait two or three weeks. That's potential loss for me if I'm in the business and able to recoup those earnings.

Jack Carr: Yeah. 

Jameson Wildwood: Um, and that was pointed out to me by the broker too. They're like, well, you know, if you, if you keep going and we keep doing this, then you'll be there and you'll be able to make this STE. Right. 

Jack Carr: And it gets worse with seasonal businesses too, from what I found seasonal, if you have a seasonal business, the brokers will use that to push.

So there's lots of good brokers out there. I don't want to, to, and there's lots of good people in your corner when you, when you're on the buy side. Yeah. But. The reason that we push so hard on this show to like make sure that you have a good buy-side team. Yeah. Is for this exact reason we've, I had this as well.

I'm sure many people have this at some point in their journey. It's like a lot of people are trying to push you into a. Direction because a $2 million close to the SBA lender. Mm-hmm. And to the, to the broker. The the [00:10:00] broker. And to the, your attor, even your attorney and to the due diligence firm is all money, money, money, money, money.

Right. The only person that gets the downside to that is Jameson holding the pg. Right. Me holding the bag. Yeah, exactly. So having a good, like, honest team I is so important. Yeah. It's so 

Jameson Wildwood: crazy important. It is. And. One piece of the team that I was advised to do a couple times and I just didn't, for whatever reason, I felt like it wasn't a worthy use of my money, was a good, um, earnings, what is it called?

Earnings report. 

Jack Carr: Yeah. 

Jameson Wildwood: A quality of earnings. Quality of earnings. Qe. Thank you. Quality of earnings. Um. I'm pretty good at accounting. I have an MBA, I went through his books pretty carefully. Mm-hmm. Um, I didn't do a full on CPA quality of earnings report, but I felt pretty confident that he was at least telling the truth about his, his earnings.

Um, I look back in that and think I probably should have anyway. Mm-hmm. Even though I was feeling pretty [00:11:00] good about it. And I, you know, I, I think I could have seen a couple things and have been prepared for a couple of things once I took over. Had I had someone on that particular part of my team. 

Jack Carr: And you're referring to the due diligence process for Sweetwater specifically?

Yes. For Sweetwater, yeah. Yep. Which I, yeah, I mean, I always recommend it, at least the quality earnings light. So there's a lot of people who are, you know, like, like yourself, that are good with that. Right. Did, did you recreate, 'cause essentially what they do right, is they, they take all the data and they just recreate the books for the year.

Mm-hmm. Is, is that what you did or what was your strategy behind doing it yourself? 

Jameson Wildwood: Um, I took a few months of the p and l mm-hmm. And, um, really looked at a few months of bank statements and sort of the ins and outs of the bank statements. And they came pretty close. 

Jack Carr: Yeah. 

Jameson Wildwood: Um, to, and he was also cash accounting and so he was very much doing cash accounting.

His, his p and ls came pretty close to matching what the bank statements was for the ins and the outs. And I just kind of did a pretty general, here's the incomes coming in, [00:12:00] here's the expenses going out. Um. One thing that really changed, really differed between the way I would account or I am accounting now, and the way he was accounting was he didn't have his, um, direct workers pay in gross.

Mm-hmm. In gross earnings. They were all in the um, operation, operating account earnings. Yeah. 

Jack Carr: They're all operating expenses, even though they should have been a gross, you know, in the part of the gross margin. Yep. Because that, yeah, I mean, that's a great example of something to do to make sure that you can compare apples to apples.

Right? It's the best apples to apples comparison you can get while doing your dd. And so Jameson, you, you mentioned at the beginning of this, the podcast where maybe right before, um, when you bought Sweetwater mm-hmm. You didn't necessarily understand. Um, which in, in your defense, I actually didn't understand when I bought our first plumbing company as well, kind of the line and the differentiation between construction [00:13:00] Yes.

Remodel, um, and then actual home service. Right. Um, can you talk a little bit about what Sweetwater's breakdown is and like what your expectations were from the CIM going into it and then how it differed? 

Jameson Wildwood: So, I knew going in that Sweetwater was a new construction. Company like they did when I bought it, it was like 90, 95% new construction work.

Jack Carr: Oh wow. Yeah. 

Jameson Wildwood: Um, and so it was a new construction, plumbing company. Now here in Apex, North Carolina, there's houses going up in every single corner. So I wasn't so worried about the like real estate issue, so much of new construction. Um, I think what I underestimated was how hard new construction actually is to operate.

And that's the one that's really surprised me is how difficult new construction is to operate and how much overhead you actually have to have in the new construction space just to keep things going smoothly. Um, and one of the [00:14:00] points I wanted to to to point out was like once about a month into this as the new operator I was having, these just freak out moments of all the things I was realizing that the seller was doing.

In his spreadsheets and his project management. And it was basically all spreadsheets in Google Calendar, right? There was no CRM, there was no, mm-hmm. Other type of project management software. It was basically Sheets, or sorry, Excel and Google Calendar, um, with some emailing back and forth. So all the stuff that he was doing.

Ended up being really complicated. And he'd been doing this for, of course, like 11 years. So he was like, oh, whatever. It's easy. Just like, write an estimate and then you do the thing and then do the thing. And I'm like, hold on. What 

Jack Carr: his process in his head, that lives in his head and yeah. It's There's not a single SOP around 

Jameson Wildwood: it.

No, there was not a single SOP. And it asked about how, how he, how he, how is plumbing going? Oh, well it comes and it goes. Yep, yep. You know, uh, well, do you project forward for the jobs you're doing? No. Well, we're just always kind of busy. 

Jack Carr: Yeah. 

Jameson Wildwood: And, uh, that should [00:15:00] have been a red flag or maybe mean, maybe a yellow flag, at least, um, about how complicated this stuff is.

And the cash cycle of new construction is really rough. 

Jack Carr: Yeah. 

Jameson Wildwood: Um, just gonna detail that for a second. So, 

Jack Carr: yeah, I, that's, I, I do actually wanna dig in on that. That's super interesting. 

Jameson Wildwood: Um, so the cash flag, new construction is long and particular, the estimate to work. And then in new construction, plumbing, there's several phases.

So there's a, a ground phase where you're putting the pipes from the utility company or the city into the ground, under the house and bringing them up into the, um, the crawl space here or else the slab. Yeah. And then we go away for like a month. 

Jack Carr: Right stub outs. Right stub up. 

Jameson Wildwood: Yeah. Stubs, stouts, um, everything else.

Yeah. So the crawl space is usually just the sewer and water. We just pop it into the area. Mm-hmm. On a slab we have to actually bring with a measure and put 'em in the right spot. And, um, we get the measuring about 95% Right. And the 5% gets interesting. 

Jack Carr: Yeah. Right. [00:16:00] 

Jameson Wildwood: Um, but then we go away for a month and maybe we get paid and maybe we don't for that particular part of the job.

And it depends on what the negotiation was with that particular customer. If we get paid for that work. Yeah. 

Jack Carr: Are you working directly with customers or you, you mean you're working generally with the GC though? Oh, yeah. The 

Jameson Wildwood: customers of the GC in this case. Right. Okay. So Toll Brothers homes, or even these smaller 

Jack Carr: builders.

And so are you to, to really dig in a little bit on this. Yeah. Are you working, you're working with, um, individual like custom homes or are these track homes? All of the above. Okay. 

Jameson Wildwood: So we have customers that, that run the gamut from $10 million custom homes with nine bathrooms and 40 plumbing fixtures, which is just insane.

Yeah. Um, to Tracted homes where there are five town home blocks and it's a, you know, two, two and a half bath house in a little three story post stamp kind of way. So we have, we run the gamut. 

Jack Carr: Okay. And, and with that, so you mentioned. Like, so yeah. A lot [00:17:00] of people, they take draws and mm-hmm. But with that, what is your average, just in curiosity, what, what's your average, uh, net, like net 30, net 60?

What, what are you trying to get paid on and then what's the reality of that? Yeah. Payment come in. 

Jameson Wildwood: Yeah. Good question. So we, we try to go at 30, um, some builders will take issue the payment at 30 mm-hmm. As that. So then we get paid at about 45. 

Jack Carr: Yeah. 

Jameson Wildwood: Um, now most the big builders have good automated systems.

As soon as the supervisor goes and checks the box that yes, we're done, it'll go into the payment cycle and we get paid two to three weeks later. Um, okay, that's, those are the good ones. Um, the bad ones we have to invoice and then remind them. And then, you know, 45 days after we've done the work, we will get paid for it.

Now the problem with that is we've had to buy all the plumbing in the house. Right. So that's two or $3,000 of pipes and fittings and PECS and [00:18:00] PVC and all that stuff. I've had to pay my guys 'cause they wanna get paid on Friday, every Friday like clockwork please. Thank you. Um, and then I get paid a month afterwards, 

Jack Carr: so.

Well you also paid out gas, insurance, rent. Yes. Yeah, I'm with you on that one. All that uhhuh. 

Jameson Wildwood: Um, yeah, so my accounts receivable is, runs about. Uh, 10% of my annual revenue on any one particular day. Um, now in service that's way different. So I, I obviously hope 

Jack Carr: with that being said, right to, to continue before I rudely went off on a diatribe here.

So you do the stub out and then the second phase is like rough in, rough in, and then third phase is finish. Yep. And then you get your final payment. Usually it's like what, 25%? 25? 25. 25? Or some, some kind like that. Yeah. What we 

Jameson Wildwood: usually ask for is 20 50, 30. Perfect. So 20% after ground, uh, 50% after rough, and then 30% after trim.

Jack Carr: [00:19:00] And so now that you, you've, you've taken over the business mm-hmm. You're running new construction? Yes. Have you tried? 'cause because here's what I always hear. Is, Hey, I'm just gonna buy, this company does $2 million in your new construction. That's an easy way to break into the service market. I'm just gonna sticker all the, the water heaters and sticker all the, uh, garbage disposals and we will start doing service work.

Yes. So we have, 

Jameson Wildwood: um mm-hmm. 

Jack Carr: And, 

Jameson Wildwood: and how's that been going? Okay. Actually. Mm-hmm. Um, it is hard though, but it's been going okay. Um, so when I got to the company, the phone was already ringing for people asking for service. Um, okay. And a lot of times, Jack, you mentioned just pick up the phone, right? Yeah, well, I did that.

I sent, I got a couple CSRs, in fact, one from Quick Staffers. Thank you Jack. Awesome. For who Pick up the phone and answer that call. We also put in place, um, a CRM system, a dispatching CRM system as well to handle that and give the techs iPads, et [00:20:00] cetera. So I, I brought that in very early on into the acquisition process.

I knew going in. I wanted to pick up the phone. Mm-hmm. I wanted to put in a CRM dispatching system and get people invoicing and taking credit cards at the site of service. 

Jack Carr: All good, all good initial things. Yep. With that, with that being said though, you, you mentioned an interesting word you said with the texts.

Yes. So do you have a distinction then, now, did you have to hire techs? Yes. And are this techs different than your install? Cruise. Totally. 

Jameson Wildwood: Very different. Yeah. So the install, um, construction crews are nearly universally, universally Latinos. Mm-hmm. Um, as is almost all of new construction these days. And, um, half of them barely speak English, and most of them make up of two man crews.

One is like. The cousin or the nephew of the older guy. The older guy is the main plumber, and then the nephew is the younger guy. The younger guy who speak English. The older guy does not generally speaking. Yeah. Um, and so those, those don't make [00:21:00] good service decks. 

Jack Carr: Yeah. So that, that's like the big one. I see.

And you actually, I think that that distinction is actually really lucky in the fact that you didn't even have the crush. Crutch, I didn't even try. So we had the crutch. So when we bought our plumbing company, it was like three installers, one kind of warranty service guy and one service guy. Mm-hmm. But like we had the crutch, we could pull the installers to technically do service because they spoke English.

But they gave you some hope, eh? Uh, yeah. They gave me too much hope. 'cause they were absolutely terrible. Yeah. Terrible. Ter like installers, like you said, are, they're good at installing. That's what they're good at. Yep. And I think that that's lost on a lot of, um, people initially. And so I try to extrapolate that for everything, like for roofing, for fencing.

Like, whenever you're dealing with people who do something really specialty, right? Tr like look at their trucks. Look at what they're doing in construction versus service. Right? Are the vehicles wrapped? Are they dress nicely? Right? Do they have the, you know, the, the [00:22:00] sales pitch down? Because all those are items that are needed for like, you know, you're running two businesses, it's Right.

You're running a service business. I'm two businesses. Yep. And you're running a construction business, correct. Under the 

Jameson Wildwood: same name, but they're two separate businesses, two businesses, and it run very differently. Um, I do not use the CRM for new construction. We still use Google Calendar. We're implementing a new project management system for construction, but it is a totally separate system from we run in service.

Jack Carr: So how much in the last six months then, how much growth have you been able to develop from that service market? Five x. Oh my gosh. I love that. So this is amazing, by the way, Jameson, I don't think you realize how many people I talk to have tried this. Mm-hmm. I like probably 20 or 30. Yeah. And there's only, there's less than five that have been able to even come success to become successful or even like relatively close.

Yeah. So, and making it work. 

Jameson Wildwood: Yeah. So I came into the business, we're running about 18 K of service with one service warranty guy. A 18 K was questionable too when Australia [00:23:00] started looking at the invoicing. Yeah. Some of the renovation work was called service work. It's not, it's different. Yep. Um, so whatever 18 KA month, um, we're, we were on set to break a hundred K this month of service.

Um, we had a slow week the first half of this week, just phones weren't ringing for whatever reason that happens sometimes. 

Jack Carr: Yeah. 

Jameson Wildwood: Um, so we probably missed a hundred K, but we're probably gonna come in the low nineties this month on our service. 

Jack Carr: I mean, that's incredible. I mean, that, that's a hu in six months to drive a hundred thousand, that's a million dollar a year division.

Yes. Like, that's, that's incredible. And going back specifically on this topic, what did you wish, you know, when you were buying the business and acquiring it about kind of construction versus service and, um. Yeah. E essentially like the split in how much work it was gonna be. What did, what did you wish you knew?

Jameson Wildwood: Yeah, I mean, a couple things. Um, I wish I understood exactly how much work it is [00:24:00] to manage new construction. Um, like I said, the cash cycle, just managing the customers, in this case, the general contractors, all of their wants and desires and pushings for this date or that date, or can you show up and all the little go backs you have to do for new construction.

Mm-hmm. You know, you have an install crew and they did an entire house, but they missed one scut, right? And so now we gotta go back there and spend two hours, essentially the day to install one escu on the wall that we missed. And that happens. Little stuff like that, um, happens with more frequency than I'd like.

Um, and that's cost. That costs money and time. And, and those are the things I think also well in capacity. Right. In capacity. Totally. 

Jack Carr: That was, that was the killer was for us, was trying to manage both of 'em. And then that capacity constraint of like the, the, the GC needs you back today or tomorrow to today, and you're like, uh, that guy's installing like two ruffins today.

Like. He's can't come back today. He's like, well, I need you today. Yeah. Because we are [00:25:00] missing inspection and you're putting us behind date. Right. And so it's just, it's wild on the capacity side, like those little misses in new construction. Mm-hmm. How much it can push an entire project and how important it is.

To be able to to continue. It's no secret that my office here in Nashville is almost completely empty. So how do I support my team as well as have great growth metrics? Well, the answer is international contractors with quick staffers. So Quick Staffers is a premier staffing agency, which will place top tier talent in your business, built by the trades for the trades.

So if you need a CSR. They'll be placing a CSR that is highly trained in your business that knows ServiceTitan and can book calls effectively. Day one. Call one. Affordable, reliable, and trained in all of the industry best practices. Quick staffers can help you cut that overhead, boost conversions, and scale your business fast.

So don't waste another lead. Visit quick staffers.com and transform your business [00:26:00] today. 

Jameson Wildwood: I basically had to hire a guy to do that. I hired a supervisor. Mm-hmm. He's fantastic. He's a total wizard with some of the stuff, but he's the guy that does all a lot of little stuff here and there throughout the day.

Um, goes, fixes this, goes and does inspection, free checks, um, you know, fills the water lines up for rough inspections and, and a whole bunch of other stuff, and talks with the builders about what's going on. Does walkthroughs, does punch lists. That's all he does. And he's pure overhead. Yeah, because, um. You know, he's just going back and making sure all these houses are are available.

Um, there's one other thing I wanted to mention, which is culture, right? So when I came into the business, it was a new construction business, right? And I'm like, yes, and we're getting all these service calls and let's start ticking them. And the main, um, main guy who was, uh, ostensibly the chief of operations, um, really had a major cultural problem with that.

And he [00:27:00] is like, we're a new construction company. This Jameson's guy is all about service and he doesn't care about new construction, blah, blah, blah, blah, blah. And I'm like, no dude, actually you're doing fine in new construction. I wanna let you continue to operate new construction. Exactly how you're operating it.

I'm gonna try not to get in your way, you keep going. I'm gonna go work on some service stuff and get that spun up and um, just kind of check in with you here and there about how things are going. And he, he just did not like that. He was really, had a hard time with understanding that I'm trying to give him management responsibility as the seller said he could later come to handle that.

He just, he just wasn't up for it. Yeah. And I think, I think the seller actually knew that. Um, and in fact later I, I found out that the seller had, in fact, previous to the acquisition promised number two, that he might even be able to take over the business. Um, and then I was slid in like, Hey, here's the new owner and the guy's like WTF.

Jack Carr: Yeah. 

Jameson Wildwood: And he eventually left instant, [00:28:00] instantaneous 

Jack Carr: culture. Uh, headbutt. 

Jameson Wildwood: Yeah, total headbutt. We were butting heads around every single corner. Um, and he eventually gave his two weeks notice and left and sort of his own plumbing company measly enough. Um, and apparently what I've heard is he's basically just running his own single truck and that's what he's doing.

Yeah. Surprise, surprise. It's, yeah, it's one those cases where I, about two months in, I figured out that he and I were probably not gonna work. Mm-hmm. But I was too scared at that point and too like head spinning, busy to just do what I kind of knew needed to happen. Which is just let him go. Right? Yeah.

Let him find success elsewhere. 'cause he and I are never gonna get along. Um, and he even said that giving us two weeks, he's just like, you know, I think you and I know that this is just not working. Um, I'm trying to keep this professional, but I'm just, I'm having a hard time and you know, I need to, I need to leave.

And I'm like, cool, thank you. Um, transition and go. Right. You know, he was [00:29:00] expensive because, uh. The way it was, it was structured. Um, he was an expensive overhead item as well. He wasn't working a whole lot. Um, there was a bunch of issues there with that, but as soon as he left, about two weeks later, once we kind of got a handle on what he was actually doing, and I figured out how to align those tasks to other people in the group.

Um, the company's been a hundred percent smoother. It's been, it's actually been really nice since he's gone. Um, clear that out. I think that's a clear, that a good key 

Jack Carr: takeaway by the way, is, uh, so, you know, I'm entrenched in the space. Yeah. Uh. And so I'm in three different mastermind groups which meets, and we, you know, I do these podcasts and everything.

The, one of the big, um, themes that we continue, I continue to see yeah, is the knowing that somebody's not a good fit, but we hold onto them just because of x excuse or y excuse. But I have never heard of that ever working out. 

Mm-hmm. 

We, we talked about it last week in a different group, and it was the same thing.

Same story. [00:30:00] And I've run into the same story. It's, Hey, this, you want this person to work so bad because they're there and they know Right. And you leave them in. But it's almost better. 10 outta 10 times to, to get the move on. Right. And then deal with the two weeks of pain and then start over again. Start over.

Right. Um, yeah, and I don't wanna put words in your mouth, but that's how it, that's how it felt for me. That's how I, I keep seeing it. 

Jameson Wildwood: No, it's, it's exactly the way it was. Like, I, I kept him there for longer than I should have because he had tenure, he'd been there for like 10 years. The seller had told, talked all about how, oh, how John is really great and he can, um.

You know, he can do all the things in the company. Mm-hmm. And that probably was true under the seller, given their culture and the way that they're working together. It was not true under me. And, and, you know, respect to him, and I'm sure he was doing a great job, but he and I were just not a fit for Yeah.

What, what we were doing and what I was trying to do with the company. 

Jack Carr: And so with this, do you have, were, were there any other like, just massive takeaways in the entire process [00:31:00] starting from, you know, leaving it to. You know, now running the business six months later. Yeah. Like what are some of the, the giant takeaways that like you get on your soapbox and, and talk about at any point in time?

Jameson Wildwood: Yeah. One, one thing I, I would like to say is I think I had way more negotiating power near the end of the deal process than I thought I did. 

Jack Carr: Mm-hmm. 

Jameson Wildwood: And the seller was just as bought into this deal going through as I was, and he was just pushing because he thought he could push. And the broker was just pushing 'cause they thought they could push.

Whereas I think if I had slowed down a little bit and be like, hold on, let's really talk about this. This is not what I want in this deal. I would have been able to get more concessions because they were just as bought into this deal going through as I was. 

Jack Carr: And were you, yeah. Were you looking for concessions because of issues with that due diligence where you found out, you know, these giant red [00:32:00] flags?

Or were they more concessions like, Hey, we, I don't even know there's this fee or this processing or like changing this vendor cost this much, right? Like where, where were, where were the concession concessions you were looking for? 

Jameson Wildwood: Yeah, there was a couple opportunities for some concessions that I missed.

One of which is when we had to switch from an asset sale to a stock sale. And that was mostly, 

Jack Carr: that's a one. Hmm. That's a big one. 

Jameson Wildwood: Yeah. Yeah. Um, and that was mostly due to licensing issues that we're having with the state. The seller was the license holder. Mm-hmm. And, um, the bank and the SBA, these are SBA rules required me to give.

The seller, some equity in the company. Now I, I'm pretty sure that's not true anymore. I think they've changed that. But, um, at least back when I did this, I, I needed to give 5% equity to the seller. Mm-hmm. And switch over to a stock sale Now, um, I tried to re renegotiate the price at that point, and I gave him the 5% off of the original.

[00:33:00] So from a $2 million deal to $1.9 million deal, which is basically just 5% less. Um, I think at that point I could have negotiated a better deal saying, Hey, there's reasons for this. Um, I think it's actually worth this due my due diligence. And, um, pushed harder for a lower number or more working capital perhaps, um, in that stayed with the business versus basically none.

Um, and that was a point where I just kind of wanted to go to, to. Uh, go through it and I should have slowed down and really try to re renegotiate what that meant as far as the deal goes. 

Jack Carr: And so you, you, Jameson, you're breaking all the rules here. You're breaking all my rules. When you bought this business, um, a stock sale on a construction company is a wild thing to do.

What's, what's the warranty on his, on like any new construction work? Mostly a year. Mo It's a year. Yeah, it's a year. Okay, so that's not that bad. No, we've had a few, 

Jameson Wildwood: but it's little with [00:34:00] little niggles and stuff. Oh, the hose bib outside leaks. Okay, fine. Send a tech, you'll fix it in five minutes. 

Jack Carr: Yeah. 

Jameson Wildwood: Um, so we have not had any major things that weren't known about at the sale.

There was one issue that, um, was known about the sale. There was a leak that happened in some hardwood floors that got destroyed as part of one of the houses, but we knew about that, the sale, and he gave me a. He knew about the back charge from the builder. That's when the builder charges you money for the the job.

Um, for, for working for them for work. Yeah. Charges you money to work for them. Exactly. Um, uh, we knew about that, so we credited that as part of it. Um, but we also had a negotiation around accounts receivable. Um, originally in the asset sale, he would take accounts receivable, right? Yeah. So I would come with a clean slate, bring all my own working capital to the company.

He would have accounts receivable and I would just have all the new billing that came in. 

Jack Carr: Yeah. 

Jameson Wildwood: As part of the stock sale, we switched that and I bought accounts [00:35:00] receivable from him. Now that changed the, the bank deal structure. And again, I should have slowed down and really negotiated this more, but what that ended up meaning is I had to bring more capital to the table because the bank had already set their maximum loan based on an asset sale with, with a working capital and a line of credit, not buying $300,000 of accounts receivable.

Did you also buy that at full price? I did. I tried. I, I see this is one of those cases where I should, I should have known I had more. Power than I did. Um, I tried to discount it to like 80% and he just wouldn't go for it. The, the, this is one of those good cop, bad cop things that the seller's agent played on me.

Like, okay, come on Jameson, this, this seller is reasonable. This is, this is fine. You should just buy it. What, what's being offered? And I'm, 

Jack Carr: yeah, that's not reasonable. A hundred percent. Right. So I mean, at any point in time you have bad debt for everyone listening. And so there is not to mention, there is a, um.

There is [00:36:00] money that you're gonna have to sink in to get that money out, whether that's hiring somebody to email and to follow up. So there's a, there's, there's a, a value to your time in collections. Right. And there's a risk to those collections, which is worth something. And normally we see somewhere about the Yeah.

20 to 30% discount, right. Depending on how long it's, it's backlogged and how, you know. Right. So like 90 plus we're, we're, we're discounting that shit to like thir 30%. Totally. 'cause there's very little chance that we're ever gonna collect on that money if it's already over 90. 

Jameson Wildwood: Right. So, um, that's one place where I really should have negotiated harder for a discount.

Um, and, you know, whatever was 80%, 90%, something like that, we only, I only was not able to collect about $5,000 of that 330, which is great. But as you said, it took me time. Yeah. And I had to. Work pretty hard to collect all those debts from the previous. I had to introduce myself, Hey, I'm the new owner. Um, you know, there was this, this, uh, [00:37:00] invoice that we sent out back in December has, you know, can we get that paid?

And so that took a lot of time and effort and, and somewhat stress to get all these things through. And now we did have a seller's note and I was, I did put in the seller's in the, the final contract that anything I couldn't collect on AR goes against the seller's note. 

Jack Carr: That's smart. Um, 

Jameson Wildwood: yeah. So at least I had that recourse Yeah.

That if it really fell through. Um, so about a few months ago when, when the 120 days happened after sale and I said, Hey, here's these two invoices we could not collect. Um, the, the seller made such a big stink about it that I just let it go. Right, because like it's, you're so nice, Jameson. 

Jack Carr: Sorry, I'm thinking over here.

You know, the other side of me is thinking like, man, if you had that clause, I, I would just like send the emails and then forget about it, man, seller note's gonna go from three, 400,000 down to zero pretty quickly there. Right. Um, because it's [00:38:00] not my problem if that, if I don't collect. And then, but yeah, I mean also that's me being an asshole.

Jameson Wildwood: I, I definitely learned, I mean, probably the right thing. I've definitely learned and, and, um, have gotten stronger in my will around some of these things in the last few months. Um, but mostly it was like, it was a time thing. Like, I'm gonna have to go talk to a lawyer. The lawyer's gonna charge me money.

We're gonna, we're gonna have to just, this, this is gonna be a lot of hassle for $5,000. Yeah, true. And in, in a 2 million business, it's not that big a deal. Um, so I just, I just dropped it. 'cause if it was like $30,000, I would go, I would go through that process. 

Jack Carr: Yeah. 

Jameson Wildwood: Um, but for five I was just like, you know what?

I have enough things to worry about. This is just not worth it to me. 'cause it's gonna be hard. It's gonna be a pain in the butt. 

Jack Carr: And a lot of times you can also buy those seller's notes out for cheaper than, than there are. So if you have a hundred thousand, I've seen people buy seller's notes out for 30%.

Wow. So they buy 'em out for $30,000 cash today, no more seller's note. Mm-hmm. [00:39:00] But I mean, some, some seller's notes are pushed out, what, 10 years with the SBA, so I can kind of get it if you needed the money now it's a really quick way to get it. 

Yeah. 

Um, and then. If you used up all that as well. Um, 'cause my worry with, with construction business also is Right, that's where they take the money from.

If you run into issues mm-hmm. Uh, on, uh, like, uh, stock sale issues, like that's the first place they go is they say, Hey, you ruin this a year ago. We have this huge bill from it. Here's my protection clause against that. And then we're gonna take it out of your. Um 

mm-hmm. 

We're gonna take it out of your seller's note, 

right?

Because it's rather than going back to the seller and saying, Hey, I need $30,000 'cause you messed this job up, right? It's easier to say, Hey, I don't owe you a hundred, I owe U 70 now, right? 

Jameson Wildwood: Yeah. And that's, that's kind of why I put it in there. My lawyer suggested, um, that that was part of the, part of the deal.

And so we, we put those in there for that exact reason that I had a, I had a way to go back to it. Um, I think I should have put more [00:40:00] ways of going back to it. Then I did. It was really only AR was a way to go back against mm-hmm. The seller's note. Mm-hmm. Um, there's probably other things and I've kind of just forgotten now 'cause I'm just like, whatever that was six months ago and yeah.

And we're here now we're operating, so it's fine. Um, and it's on, it's on at least a two year payment, standby with a think a five year amortization after that two year standby. 

Jack Carr: So, yeah, 'cause there's lots of things that you can do that with. You can do that with, Hey, we expected the quality of these trucks to be working day one at a functioning way, trucks and in new construction trucks, the trucks tend to be older and break down really a lot and are rough.

And so if they promise that, then you can actually go back to the seller and say, Hey, we have to do two transmissions. You said this would be running day one. Three transmissions is what? Jameson's holding his fingers up day one, three or week one, or month One month, yeah. Month two, basically. Yeah. Yeah.

Month two. You promised me these vehicles are working month two. They're not like, they're not the [00:41:00] quality that you, you said they were, which is a completely legal and reasonable thing to do. 

Jameson Wildwood: Yeah. 

Jack Carr: Hey, we're gonna actually charge that back to your, um, your seller's note. 

Jameson Wildwood: Right. Obviously that would actually be a fantastic.

Um, lesson learned is that have more of the company's assets potentially chargeable against the seller's note, including the trucks if you're getting trucks or inventory. Mm-hmm. Um, if there isn't the stated amount of inventory that was included, have that chargeable back to the seller's note. If the trucks were in entail condition, have that chargeable back to the, the seller's note.

Jack Carr: Yeah, I think they're called, uh, uh, I'm sorry. I'm not a lawyer, everybody, but it's an indemnity clause. Mm-hmm. Is, is what I, I believe indemnity pro protections get a good m and a lawyer. Small business lawyer, they should know this, they should be able to walk you through it. Most do. Um, some don't, some do go really light on 'em.

I prefer a more heavier hand. Yeah. Just because obviously you're hearing from Jameson exactly how it goes. 

Jameson Wildwood: Yep. We had three transmissions in the first two months [00:42:00] and two beaters that I'm just like, I should just sell these and get rid of them and we'll get some new Ford transits. Um, and so we got, part of my, my transition of service was I got five new high top transits.

Um, we got wraps done. They look really nice. And, um, that's been one of the big costs in starting up service. Yeah. Like those are expensive. Yep. Um, and there are loans which, and the loan's a pretty good deal, but still the wraps cost money. The design on the wraps cost, money, um, hiring. We, and we hire, we've three new hire technicians at this point.

Um, and getting them trained, um, getting 'em up and rolling and all that takes money. 

Jack Carr: The CRM, the iPad. Yes. The iPad that talks to the cellular system. Yep. The uniform if you have 'em in uniforms. Uniforms, absolutely. It's, it's a, it's an entire business that you're starting up inside your business. 

Jameson Wildwood: Totally.

And I think at the bottom of the J curve, thank goodness. Um, at least that was the bottom last month. I think we're slowly working our way back up from the bottom of the J curve. [00:43:00] Um. And the J curve is real, by the way. I, I had this grand vision that, oh, the J curve won't, won't apply to me. I'll be fine.

Yeah. Wrong. 

Jack Carr: So I mean, most people like the J curve, right? You're talking about like business J curve? Yeah. Where, or like cost J curve. 

Jameson Wildwood: The cost J curve. 

Jack Carr: Yeah. 

Jameson Wildwood: Where, where the first six months of the business, uh, you aren't making anywhere close to the amount of money Yeah. That the seller was making. Um, for a variety of reasons, whether you're pissing off customers 'cause you don't know what you're doing, which part of this, um, or, you know, I, like I said in the beginning, I had to hire more overhead to compensate for his 11 years of experience in this company.

Um, I hired an estimator. I had to hire a, um, a new supervisor. I had to hire an accountant. Um, and we had an office manager for a little while as well. Um, so there was a lot of extra people I had to add on just to manage data to operations that he was doing [00:44:00] from home because he had 11 years experience and it's just easy for him that I just couldn't.

Um, and so in, in that J curve like that, that overhead blossomed really big in March, April and May. Um, and I've, I've got it better, better under control now, but, um, it was, it was hard. 

Jack Carr: Yeah, and then it, the, the nice part too though, some of that is, hey, when you come into a business. Yeah. Some of it's like emergency expense like you're referring to, but also some of it is, hey, we started doing marketing.

Mm-hmm. We built a website, we wrapped trucks. Yes, yes. We bought new trucks. Yes. Like it's all investments into growth. Yep. And so what was nice about that is I felt it too. I think most people feel it, hence why it's a terminology. Um, but like as you round out that year, mark. Like you start to see the fruits of that labor and then instantaneously you're like, oh, wow.

Like we have the infrastructure now we're taking off. Yes. So five XI hope you, yeah, five x is huge. So I hope you get to see that here pretty, uh, pretty [00:45:00] soon. Yeah. And um, I. I, I mean, awesome Jameson. This is some great stuff. I, I love these conversations. Not because, I mean, you're still here, so you're still here in truck and stuff.

I'm still here. Like the bad stuff sucks. Um, you know, they're, we're trying to create the content around exactly what you, you went through to Yeah. To help push this through. And so I'm, I'm glad you know, it's, it's validating to some extent. Um. 

Jameson Wildwood: There's one more, there's one more. You, you ran a, uh, I think it was the Jack Acquisitions podcast actually, where you're like, just add marketing.

Right. And you mentioned it's, it's not that simple. Um, I'm basically the CMO for the company, like the chief marketing officer of the company. Me as well. Yeah. And, um, I've had to learn how Google ads words work. Mm-hmm. I've had to learn not how to burn thousands of dollars on Google AdWords. I've had to learn how to do LSA.

I've had to learn how to do, um, direct mail, how to interact with that. Um, there's been so graphic 

Jack Carr: design, uh, so 

Jameson Wildwood: much, yeah. Marketing stuff I've had to [00:46:00] learn and do from scratch, and it takes up a lot of my time and energy. Um, thankfully I've got a great service manager who's dealing with the like day to day call to call kind of dispatching stuff and he's fantastic.

Um, but that learning how to market, how do I fill three technicians calendars every day? Yeah, right. That was hard. Going from one technician kind of halftime back in January to three full-time technicians and filling their calendars every day with marketing, with dispatch, with call booking has been hard.

Um, you know, that was, that was 60 hour work weeks for the first few months. Um, and I thought I could do it, but, but man, it was, do not underestimate how much work it is to start up, uh, service. 

Jack Carr: Well, I'm, that's also validating. Thank you. I'm not the only one going through it. I mean, we, I've been doing that for three, four years now because of it.

And, and you try to give it to a, uh, you know, a third party company Yeah. And it doesn't always work. And you end up burning more thousands and more, thousands and more thousands of valuable dollars. 

Jameson Wildwood: [00:47:00] Yeah. So I, I am working with a company right now, um, service lifters. Mm-hmm. And they're really just doing website, SEO, Google Ads and LSA for me.

Um, and, uh, so far I've only worked for about a month so far. They're great. Um, I'm really happy to have a partner that kind of knows that stuff and is able to help me, uh, do some of those things that I can now go back into more of the CEO role versus the CMO role. Um, but so far that's, that's been nice.

Um, we looked at a couple different companies that kind of hit the whole package. Um. But, but getting Google ads working, getting Google ads optimized, Google Tag Manager getting the, uh, website, SEO optimized, like it's 

Jack Carr: negative keywords and Yeah. Yeah. No, I'm, I'm with you on that one. It is, it is a lot. And then it's continuous.

Like it doesn't ever stop. It's turning things on. It's turning them off. And so at the end of the day, if you can buy, buy that, and it already has Yeah. The dials, if it already has weavers and dials, if, yeah. You know, John John's a. [00:48:00] Company stole that from me and now Oh, did he use it? Yeah. Now they're using it internally.

Yeah. Levers versus dials. 

Jameson Wildwood: Yeah. We just pulled the direct mail lever for, for this week. We've got a big mailing going out to our little local area. Um, for the first time ever, and I'm gonna see how it works. We'll see what happens. 

Jack Carr: Yeah. You should text me on, uh, if that actually works. We've tried it three times.

Yeah. And zero. Yeah. Like almost no ROI. Okay. And so I, we've tried, like, I don't, I I don't think it's a volume thing. We have too much in our area. Mm-hmm. So I'm always curious of like, what's the design that gets other people's to work? 'cause maybe it's design versus function. Yeah. We'll see. Right. We'll see.

You just 

Jameson Wildwood: gotta try it and see. 

Jack Carr: Right. So if you're able to buy that, the key that we're getting at here, both of us agree, is if you're able to buy those systems right out the gate where they've already designed, they're already working with somebody, they have ROI. Yes. It is immensely easier Yep. Than having to take six months and learn yourself.

Yes. So. Uh, lots of learning. Lots of learning. Awesome. Guys, if you like what you heard, like, subscribe, uh, let us know in the [00:49:00] comments what you want us to talk about. Industries, areas, expertise, levers, dials, whatever you want. And Jameson, if people want to hear more about your story or connect with you directly, how do they reach you?

LinkedIn, I'm on LinkedIn, 

Jameson Wildwood: can find me, Jameson Wilder, LinkedIn, or Sweetwater Plumbing. Jameson Wildwood, 

Jack Carr: what a name. Alright, thanks Jameson. I appreciate it. Bye bye.