Marketing, Sales, Capacity Planning, and Scaling Home Services with Ismael Valdez

One of the biggest mistakes that I see contractors do taught me and their tignations do and their project managers do is that they do the shopping for the client. You guys cannot ever, ever do the shopping for your client. That's not what you're there for. Welcome to the Home Service Expert where each week Tommy chats with world-class entrepreneurs and experts in various fields like marketing, sales, hiring and leadership to find out what's really behind their success in business. Now, your host, the Home Service Millionaire, Tommy Nello. Before we get started, I wanted to share two important things with you. First, I want you to implement what you learned today. To do that, you'll have to take a lot of notes, but I also want you to fully concentrate on the interview. So I asked the team to take notes for you. Just text notes, N-O-T-E-S, to 888-526-1299. That's 888-526-1299 and you'll receive a link to download the notes from today's episode. Also, if you haven't got your copy of my newest book, Elevate, please go check it out. I'll share with you how I attracted and developed a winning team that helped me build a $200 million company in 22 states. Just go to Elevate and win.com/podcast to get your copy. Now, let's go back into the interview. All right, guys. It's a special day. It is super bowl and I got my good buddy, Ishmael, here. Ishmael Valdas. He's an expert in business. Eric conditioning heating and plumbing. He's based out of Anaheim. Founder of Nuve and founder of NextGen. Ishmael is a founder of CO. He wasn't NextGen and now he's 100% in on Nuve. Yes, sir. Ben in the trades for almost 20 years. I just want to. That's just sounds old, man. Honestly, 20 years. Bro, so I started 17. Yes, so I'm going on 21 years now. I feel like dude. That's crazy. The overnight success, everybody talks about how long you've been on it, Tom? 20? Yeah. No, I was painting garage doors for, I guess, 2005. Yeah, so 21 years. Damn. So if you were to go on a company, let's call it a 20 million dollar company, what's the first thing you'd do? If you were, let's just say, call it a year and investor. You're buying 20%. Yep. What do you start? The top five people in the company, the CMO, hopefully they have one, the CO, the general manager for sure. So probably if they have a C suite or just a managed system in there, that's the first people I want to talk to. Without the owner being there. My first move is I would walk in, you know, I would say hi to people and you know, just see how the operation flows to me like energy inside the operation is super important. Like I've been to operations like even yours, you walk in and everybody's just like, yeah, everybody has their roles in their operations. So and then I would grab the C suite or the upper management and I would probably take them out to dinner and I would want to dig into them because they're the ones that, they're the ones running the business, you know this, right? And I'd probably spend a really, really good amount of time before making the investment. And then after I talk to them and figure out that, you know, we're on the same page, then I would go in there. But I would start with those, those, those people. Then I would walk into the, you know, show me your financials and all that. That's the thing as I think the data. I want to know how well do they have, whether it's service, tighten or house called. That was my second dial in the CRM. I need to see the numbers. Yeah. What do you think that, would you want to talk to the people first or would you want to, would you make your decision all based on data, meaning the PNL's, the balance, the service tighten set up, all that. I want to meet the people, but it's 20 million of revenue you're talking about. That's a good operation. Three million dollars of EBITDA. But for a hundred dollars. At 20 million dollars of revenue, there's something there. It's not like they're trying to figure it out, right? No, no. I would just say like, if I didn't feel good about the data in which they were managing, there's no point in to talk to the people. But then I say, could I make a ton of impact in this business because these people are capable of, of course, they've got the data to know. Well, they got it up to 20 million dollars, right? So there's something there. There's something to work there. Now, you tell me to walk into a five four five million dollar company. That's one man driving that whole business. Not fun. It's not fun. And there's more opportunities. You know, I'll say this about Ken Goodrich's because he'll say this to your face. No. He buys broken businesses and fixes all the time. But I don't want those. I don't have time. It's a lot of headache. I think there's a lot of money there. It's just like in real estate. You can go section eight housing. Exactly. And you're exactly how I look at it. It's a lot of work. I rather go and look at a 10 million dollar house that needs a little bit of work and, you know, put a little bit of investment behind it and make it be worth 15, 20 million dollars overnight. Then get a million dollar house and dump another million and still be two, three million. It's like, how much is your time worth? Exactly. You know, but Ken's done some cool stuff. I think we all got our little, I think we all got our little things that make us special to tell me. I think what I love being around you and AG and all these guys that everybody has their own little thing that we're all learning from. You know what I'm saying? I think you're good at your number one thing is recruiting. Yeah, bro. I'm relentless. I'm relentless. And really when you thought about it, you built it and you said this based on what Leeland did is you just take his top guys. You pluck them one by one. That's it. And then you built a good business offer that. One thing you did do as well with Andrew, is you spent money on leads. And so you were good at recruiting, but you had enough leads for them. You can't get great people. Victor Rancourt talks about this. He goes, I left service champions. I was promised equity. They gave me equity. They gave me way more money, better commission. But I didn't even know my stats. There was no team there. I was the guy. There was like three other dudes, but like there was no infrastructure. There was no meetings. There was no rar rar. There was no dealers coming and feeding you getting you excited. I can't. I don't care how profitable and how dope the operation is telling me. To me, there has to be some kind of like competitiveness inside the operation. That has to be some, you know, hey, bonuses. And just if you would see the way I drive these businesses from home comfort, next year to now, Nouveau, I drive them exactly the same way, bro. We are a sales driven organization. I don't care if it's an air conditioning or garage store, a thermostat or a toilet. Obviously, I've said it before. You cannot move from the most important thing, which is marketing. After you master marketing, marketing is the first step in the operation. After you master marketing, you can and you could lead generate on a snap of a finger. And you, you know, you got your message out there of who you are. After you do that, then you move on to the second step, which is the sales process. And you don't move on from the sales process to the operation process until you master the sales. And this is where all the $5 million operations get around. They think that they're working on something all the time. They're always working on something else, but they're not doing anything, though. They're busy, but they're not productive. They're busy, but they're not intentional. They're busy, but they're not, you know, moving the needle forward. And that's where I think they get it wrong. To me, it's, it's, hey, there's three different operations to growing any freaking business. I don't care what it is. There's three different departments. There's a marketing department. There's a sales department and there's operation department. The operation department is a customer fulfillment. What happens when the sale goes through to when we collect a check? That's what I call the operation, right? Anybody could, dude, you know what, you know what I found out? And all these 4, 5, 10, 15, 20 million to our guys are exceptional operators. They freaking suck at marketing and sales, bro. They suck at marketing and sales. That's all I live for. They're marketing sales. But I like that. Make the phones rain. Do you know what your super power is? What? I think you're probably one of the dopest marketers in the world. It's marketing. Get the phone or ring off the hook. We generate 34,000 a month. That's the month. That is insane, bro. Yeah. And I think I'm just getting started. And 34,000 leads in a month. Let me, let me put this into your eyes and into perspective. You guys are probably going to generate 34,000 leads in your whole lifetime. Tommy's doing that shit in a month just to give you guys the perspective of how, like his super power and correct me if I'm wrong. I know you're a super operational. You're super methodical with numbers. You know, you're very data driven. But I think you're super power and what most people under reach is you're a marketing genius, bro. That's what you are. You're a marketing genius from the way you carry A1 from the way you lead generate A1 from the way you present A1, right? I think you do okay in sales and operation and that's why you know, you have amazing people like Luke and all these guys behind you. Yeah. But I think your super power is, you can understand the funnel. Here's what I want people to think about. And this is where me and Luke, we got a healthy relationship that I could kind of combat with him a lot. Yep. And I said, Luke, let's just do some quick math here. We've worked really hard to get to 90% booking. 90%. Now, we're in 40 markets. True 90% by the way, not like you're fucking. Yeah, no, it's just 90%. But here's the problem. 14% cancellations. And that's just because, you know, we have 62 guys training, capacity planning. I think we could get that down to seven. But so, so I'm losing 10% out of the gate, right? Because I'm at 90. Yep. Then I'm losing 14. So I got 10. And those cancellations on the 14% is it because you can't get there fast enough because I've analyzed the hell out of it. How booked out do you stay before your answer? How booked out do you stay all year round? Oh, yeah, we don't have any seasons. So that's in the colder climates. install goes down quite a bit. I don't have a month that's ever gonna be less than the last month, unless it's all we do is say how many Monday through Fridays do we have. The month that we kill it, we've got 23. The month that we don't we got 19. Even though we're all but Saturdays and Sundays. Do you know what I would like to see you operate? Yeah. In our conditioning business. I'm telling you right now, dude. I would love to see, because look at the one thing you mastered is marketing, marketing operations, sales, all that, right? You're phenomenal. Seasonality, Tommy. Let me give you the influx of seasonality. How many times have you sold service agreements? 15 million dollars, this is a peak at next year, right? Yeah. We did 15.1 million dollars in our top month and our low month, we were like at 6.2. So that $9 million fluctuation is what drives people nuts. Why nobody can. And look, service agreements do how per lock? It's tough. It is tough. But the seasonality. So I asked Keegan, and I said, "You're the only guy I know that's run lots of millions of e-bidda through Grazdor's and lots of millions through an air conditioning company." I said, "Honest to God. I'm in his office. We're doing an interview. You are there." And I said, "H-Track or Grazdor's?" H-Track all day long. He goes, "Meaning tough? What's tougher?" No, he goes, "If I'm going to do something, my non-compete's over." He goes, "I'd rather do H-Track all day because it's such a big ticket." He goes, "I can get 20, 25 grand from a home. Grazdor's, I can get six or seven, and that's of a new sale." But look, you're not used to seasonality, and you're not. You want me to tell you what you're not used to though? One thing that you're not used to that you probably never thought about? What? Turn over. You're turnover rate on employee spucking skyrocketing seasonality. I'm at 35% turnover in your first year. No, I'm saying over. You're way lower than that. But check this out. So you're losing 10% so Luke, you're losing 10% in the call center. 14% cancelation rate, study the cancellation rate, and all these cancellations are due to one thing. Customers solve themself. Customers found somebody quicker. Nobody resulted themselves. They just called somebody quicker. So it's all about getting out there to these demand-driven. I go wait a minute. 10% plus 14% than conversion rate. That's when you're face to face. You're at blended 74%. So that means we're losing 26%. Let me ask you a question on that. Blended 74%. Do you include the $88 of complaining to you? Or whatever you guys charge? We don't consider a conversion unless it's $125. I would consider an HVAC guys. An HVAC plumbing and electrical. I would consider a true conversion 500 bucks enough. 500 bucks enough is a true conversion to me. Why? Because it already cost you two 300 bucks in there. It already cost you another two 300 bucks to get the labor behind all that. If you are not producing 500 bucks inside that house, I believe you're losing money on every single one. You do as we look at. My scorecards are really, really good. A good guy will do about $1,500 average tickets that's funded. I got guys that are doing 4 grand. But if I'm losing 10% plus 14% plus 26%, that's 50%. That's half of my leads. I'm not earning their business. So don't ever say it's a marketing problem. The transferation wants to go and say it's a marketing problem. And they're like, we need more leads. I'm like, well, let's get rid of these cancellations. Let's get rid of these people not booking because the worst one on lace that I see pop up is the service times didn't work. Like we did. You know, found some of the book stuff. Yeah, it's like. So you look at that. So I believe we could get to 94% from 50%. No, no, no, no, 94% from the context center. I believe we could get the cancellation rate down from 14 to 7. And I believe we could get our conversion rate from 73% to 80%. Do you think you're always going to be at 14% because. Hey, I'm going to add more stuff, but I'm going to increase marketing and then it's going to keep chasing your talent. Do you think you're going to. So here's what I'm trying to do. I'm trying to spend as much possible money as I possibly could and still have a staff to where I've got to do outbound that day. So 20% of my volume in that market will be on my list. So I can pick up the 20% but here's the deal. Same day call out. That's what I was going to say. I'm okay. Now I'm down. I only need to fill 10% of the board. I got a guy that his daughter just got sick. She needs to go pick her up. This shit happens. So it seems like something I always have. It's guy guy, a fender bender or something. I want to have all my inbound to where it's 80% certain markets, 90% certain markets depending. We're building out a whole tool. I've got a company building the most advanced capacity planning tool. Then you staff up and you over staff and then you got to do outbound. And that's the way you fix it. So you do outbound right now? We use a third party. We use Jack from Elite. For the H-track electrical plumbing, we live on our bomb. That's an important thing. And this is where some of these air conditioning guys miss it. Plumbing an electric guy's missing. You guys, when it's shoulder season and there's not enough leads on the board, you're freaking hammering your customer base all day long. You're hitting them with direct mail. You're hitting more of the email blast ring. It's voice no text messages. You're hitting them without this. This is one thing that Lee Lynn said that really stuck out. He goes, I start over today. The only thing I'm doing. He's focusing on service agreements. He goes service agreements is the life level and there's no weather. That's his, like no one's really, I don't know a lot of companies. So you pulled it off. And Lee Lynn's just every single year, 22%. I think I pulled it off because of my growth. If I would have had a slower growth, I would have lost more people and I wouldn't have done what we did. We were just growing so freaking fast, right? But you have said in things that very few companies will invest in. You guys did the baseball stadium. The billboards? And you did a lot of billboards and you kept it clean. And I remember showing up at your shop and you were laughing. You got like 18 guys doing the lettering on your trucks everywhere in your parking lot. You're like, I just added 20 trucks. Then you got two raptors sitting over there because I think you won something service tight. I give them to my general manager and my ops manager. So what did you get? What was the contest to ever get started the most client? I just kept giving them referrals. People kept coming up to me, touring my shop and I would show them how service time would benefit the business. And they just kept, they gave me a Corvette. They gave me three raptors. They gave me money. Like they just, they just want to bump in beyond for me. But honestly, I grabbed all that and I gave it away. I never really stayed with any of that. Let me go, let me ask you another question. This is something I've been studying a lot of. So you just sell next year. Today's the day the wire hits. I think this is important because a lot of people are probably going to exit in the next few years. Which I hope you guys do by the way. What's the best advice? I'll give you just a few things. Number one, buy a nice car. Yes. Buy your dream home. Want a dream vacation. Yep. But keep a lot. I didn't do the dream vacation. I did the car. Keep the money though for a while because there's a lot of opportunities day one. But if you wait for a year, it deals fine you. Like so many good opportunities. So what else would you say? Because then what is there for you on my day? I would say, look, when I had the wire come into me, I did something. That most people wouldn't have done. I had, I think I have like seven commercial buildings anywhere from 10,000 to 54,000 square feet that I least out back to wrench. So I had seven buildings. I had like nine houses that I had. So like when that money came in to me, I went and bought, you know, a watch and a car and like all the nonsense that I wanted to get off my chest. But then I paid down all my debt on my real estate. Which looking back was pretty dumb because I could have grabbed that money and I put it, you know, a stock sponsor and it would have created some pretty good returns. But I've sold, I've sold, I think two of my commercial real estate buildings and I made between just the two a little bit over 3.1 mil on them. And you know, and I only kept them a couple years. So I've done good in that and I shouldn't have paid down because now that I had, if I would have had that access to all that cash right now, then I could have bought a business here. I could have bought a business. I could have done the Tommy Mello. That's fucking owns. Well, the thing is for me is like you own half of the industry now, Tommy. I've earned a lot of, I've got all my sitting in the market and I'm just killing it. It's doing very, very well. And you know, Joe, Joe does good for me. He just got me the Amex. Thank you for him. By the way, he gave me the Amex Black card. He just got it. He figured it out. And I'm like, do you want to pay for this? It's the only five grand a year and you get all this access. What else was I going to tell you? Now that I answered that, I think I would have kept a little bit more cash, to have a little bit more liquidity to be able to step on these huge opportunities because I bought into some dope ass businesses. There's some deals. And that's one thing is on this next deal. You're on my list of just people I want to do business with because you're a hustler. Thank you. And I probably got a list like 25 people that like, I've got a plan to like really, really really. Business gets you excited. Besides day, I know you're going to say, what business? I like stuff for a lot because it's revenue. It's annual recurring revenue. And I like home service. And I'm starting to like home improvement, but the multiples aren't there because it's not demand driven. So the multiples are half of what they earn home service. So there's 20, like, roofing a lot. I like water restoration. A lot, a lot because I think I overdid it. I overdid amazing stuff, dude. I mean, those guys did well in California. I think are you guys going to get the 10 million EBITDA? Yeah. Are you guys going to turn this in? Oh, they're working on it. It's not my place, but they done it. Edgar and Edward did it exceptionally well. Well, but here's one thing that I am working on. On the next still, the PE company doesn't care at all about the real estate. In fact, the bigger PE companies, I'm gonna go tell them, I'm going to do by a building in every market that has substantial EBITDA. And it's gotta be 20, 20 plus buildings. And I'm gonna put 10 year leases minimum on them. - That's right. - And then you sell this portfolio, it's worth 50% with the 10 year lease. And it's not a triple net. And so let's say my average building, I go out and buy 20, it's $5 million. It's 100 million. It's worth 150 million. The day I put them all together. Then there's a PE company, not the PE companies we work with, they're real estate. All they're shooting for is 10, 12% return on investment. IRR internal rate of return. So they're happy. It's slow money, but the rent goes up every year. And we're happy, 'cause they're really good properties. And we do tend to improvements in everything. But you make 50% so just by doing that. - Just by stacking them up. - 50 million bucks. And I'm doing a favor for A1. 'Cause I'm getting the best locations. So. - And it's not like you're gonna take advantage of them on the lease, you're gonna give it to them at whatever. - No, you're giving it to them. - You're not gonna do this. - Great cost, they gotta sign off on this. But then stay one. And here's the cool thing. You might say, "Hey, he made 50% on 100 million." No, because there's hundreds of millions in the bank. I'm getting low 90 to 10. So I've literally spent $10 million, paid a little bit of interest along the way the first year. - And you could grab that million. - And you could grab that 90 back? - Yeah, so all the banks. - Because the banks, they look at this and they go, well, you've got hundreds and hundreds and hundreds over here. We're good. You're not gonna default. So they'll give me all the money I frickin' want for that. So that's the thing. - Where'd you learn this from? Cardone or the other paste guy? - Who? - You know what I'm like. - Paste more be a lot. - This guy, man. But I don't know who told me and they're like, but it needs to be a portfolio. So CBRE and then I started using CHEBT and they're like, if you could get 20 year leases. Now that you got 10 years. - Yeah, 10 years are great. - Yeah, I got 10 years. - I mean, it's very, very, very safe. That's what's so cool about real estate. Now paste is a genius. Cardone's really good too. I will say like, you got to respect all these people. - I do. You know what I've seen in the video when him and Cardone are talking about what? - Yeah, I've seen that video. - And he goes, - And he's just like, what the fuck? Like, I've been saying that to Matt and Jacob and Eric. And then I text paste in the text. And I said, I need you to give us just a one day class. He's like, dude, that was probably one of the dopest videos I've seen them do. Cardone was just like, what, I feel like I've been doing this year wrong my whole life. - Well, Anna told me that. - That's a smart girl too, bro. She's like, there's some laws passing that make it harder to do creative financing. So, but he's a very creative guy. - I know he is. - And me, I'm like, wait a minute. Like, what if we went to like the Brian Cohen's of the world, like all those bankers. We got to win an Eric and Rob. I say bring us deal flow. Like, there's a lot of deals that they're like, they're not even big enough. - You're about to open up the flood gates for you, huh? - Oh, you got to have a system. It's got to be, here's one thing that you should think about. Like, is it Linux? Is it good, man? And I know you might change depending on who it is. Who's the finance company? Service type, the exact same playbook, the data, the exact same APIs. You're gonna use Trip, you're gonna use Lace, you can use Avocat, like whatever you're using, bam, because all the companies you negotiate, that's the thing is you pay less. And that's what they can't, can't, can't, you know, I know this. - Neat, I'm talking. - I mean, these guys said, we're gonna start buying together. So Parker's gonna buy what they buy and on the land. And by buying together, they're gonna save like $40 million of you. - But trust me, I've been, I was the number one person knocking on Ken DeHane's door telling him, bro, we're not taking advantage of our size. You can go to Dijkin, you could go to Linux, you could go to all these finance companies, and leverage our size and put so much money on the bottom line just by leveraging it. - So much. - I know. - And then the way you buy insurance, the way you buy your trucks. - I know that's the way you do it, right? - Yeah, I buy the same trucks. - That's what I'm saying. - And everyone get the same exact tool. - Everything is the same throughout the whole company. I only need one CFO too. That's one thing, like I think Renshe's a genius company and they've done extremely, extremely well. And their answer was, well, we buy great companies to leave them like they are, and I'm like, but then you gotta CFO in every market. - Yeah. - I got one CFO. - And then all those CFOs, there's friction between them and-- - Like you get one CFO, one CFO. And one CFO could run a hundred markets. So I think Frank's doing a killer job. - Well, I think they're about to. - I've heard some rumblings. - Hopefully, hopefully there's a press release any day now. By the time this comes out, it might have already been announced. - Hopefully because we need these portfolios to start turning. You know what I do wanna talk to you about, tell me that I don't think a lot of people notice this and because they're EQs a little lower, they're just living, look, what happened at next year, bro, was the perfect timing to what's happening right now. So in 2018, 16, 17, 18, when we were barely starting next year, the blue dots and all those guys and the ARS were coming into our industry and they were trying to, you know, do what they're doing right now. And they pissed off a lot of managers, bro. They pissed off a lot of C suites and high level managers, high level sales guys and everything. So I came in as a fresh phase into the industry with this, you know, next year and 49, 4,995 does it all and everybody was talking shit on me. How could it be selling systems for 5,000, your craze, you're gonna go out of business. All I was doing was stacking labor, bro, because labor, you can't do nothing without labor, right? So that happened in 2016, 17, around there, where everybody, dude, I had access to people because I was a fresh face and I was advertising, I was being aggressive with my recruitment. I had access to people that I would never have access to, every in my life, some of the, you know, $5 million guys and $3 million technicians and all these guys because PE was pissing them off. Well, the same thing's going on right now and this is why I tell all my $5 million companies, you guys are in the best place of your life right now. You guys are in the best, you guys are gonna have access to next year and people which, look, you know, unfortunately next year and you went backwards, right? And they let go of like six or seven of the highest drivers in there. Now they're starting their own-- - Daniel, so they're-- - Daniel. - No. So now they're starting their own little companies and they're starting, like, they're doing the only, look, so what I'm getting to you, if you're a $5 million our company, or you're a $10 million our company, you wanna get to $25, $30, $40, $50 people. The people that are gonna take you to those milestones, you have access to them right now. I promise you guys, if I was that next year and right now, you guys would have zero access to my people. They would laugh at you guys when you guys would try to give them more money or equity in your company or whatever it is. So take advantage of what it is. This is the greatest opportunity in home service industry. Not just because, look, and I call this the perfect timing, private equity, making mistakes, you have, the industry being discombobulated, this is the perfect fricking time to grab those people, put them in a team and let that, and then cruise into $25. - There's a lot of other things going on. People don't know this, a lot of people, but P. Barrel's money. And it's the coolest thing in the world, as you know, when I really run it. - That is what I need to learn from you, by the way. So I hope to have a good conversation with you later on. - This is crazy. Listen. The P company, Barrel's money against my EBITDA. Yes, they put in some hard money too. But they borrow the money that I'm responsible for the payments. Every time they fly out, who do you think's paying for their flights? What about their hotels? - You. - What about dinner? So although they're amazing and I made all the right moves, I remember when Ken Goodrich called me about, he goes, Tommy, you're probably one of the better guys I've ever seen at this trade, at just home service. He goes, but you don't know what they know. He goes, you learn how they raise capital. You learn about their LPs. You start going to their meetings. You understand exactly how the formula's working. Now I understand all this stuff. And I'm going, wait a minute. There's a great big company that went out of business. It was Renovvo. And Renovvo had all these home improvement kitchen remodel, bathroom models. They were making a ton of money, but guess what, their debt payments were too high. 'Cause they took six times leverage. So let's see your $30 million company. EBITDA. I could take on that $30 million. The bank will give me $6x. So I could borrow $180. But now that company that I bought into is responsible for the payments on $180 million. - Good, yeah. And the interest, too. - Well, the interest. - This will kill you, right? - So dude, that's what happened. It's black rock was their lender and they're like, they just shut down. So when you sell your business, be careful. - Of course. - Now debt is a great thing because debt, 'cause I wrote 50%. So the debt actually makes the numbers way better. If it's done right. But you gotta be able to grow, too. Those first couple of years are critical to get the massive growth. So this is the hardest thing about private equity. Is there gonna put debt on your business? So if me and you went to go buy businesses, I'll give you an example. We were at the suite yesterday. And it was on, might've been Friday. - Yeah, Friday. - And I look over and my buddy Tony's at the booth next to us. And he goes, yeah, I'm the president of this bank now. And Eric walks up and he goes, dude, you know that guy? I'm like, yeah, I've known him for 15 years. He goes, he'll loan us all day long at two X. So you go into a business that's two and five million of EBITDA. - I think you would tell him. - They'll give you a 10 out of the gate. But now this company, called ABC Hrat Company, is responsible for that debt. So that's how these multiples come up because they take on more debt. Is it always good to take on that much debt? Let me, I don't think so. I think what's a healthy debt that you wanna be when you're crying these businesses? That's it, they're doing $5 million of EBITDA? Well, well, the more EBITDA they're doing, the more debt you wanna take, because at a certain point, it's more expected like, if you looked at our financials, you'd understand that we've never had a down month or a down quarter. And what that tells you is, we don't really have a lot of, we don't have Home Depot. 'Cause if we lost Home Depot, let's say that was 20%, that's a big area of concern. Let's say we had a huge contract with Costco. Now, those are great contracts to have, but let's say Costco says, hey, what we're taking you out, we've got a better- - In your son, I know. - So that's why having a lot of different clients and a massive database and a lot of different markets. Let's say there's, right now in Florida, there's a massive crisis going on, that real estate's going backwards. And one of the biggest reasons too, is that the house are uninsurable. Our cocaine comes, like the insurance companies are charging so much frickin' money. And Keegan lives there, he's like, dude, this market's upside down right now. Well, I'm in Florida, but that's only one market. And we don't really feel it. You know, we're also in Detroit, we're also in Reno, we're in all over the place. - Is there a number that you look at? Tell me when you open up like a Florida location, right? And let's say you're gonna be, you have a three-year plan you wanna be at X amount on top and bottom. And this is good for your listeners because this is one big huge mistakes that I believe a lot of contractors do, is that they start their business, they get a four or five employees, they grow it, but they're not making money, they're not, and they're keep holding on for dear life. Is there a certain amount of threshold time that you go like, okay, cool. If in three years we're not at X on top and bottom, how long do you hold it before you go like, okay, we gotta shut that market down. - Well, my biggest thing is finding the right leader, but now we're a lot more at a little cool than to go into a market, but it takes bigger companies with bigger average tickets, could turn a company, could turn a group of people around six months to where it's profitable, takes us 18 months. But I don't wanna have a popsicle stand. So I'm putting in a lot of money into TV radio billboards. Which you don't see a return on that. - I know. - For over a year. I mean, Aaron's going through the same thing when he went into Cleveland. - He's an editor. - He's like, or Cincinnati, I'm gonna spend a fortune and I'm not gonna see an ROI for a long time. But then all of a sudden, it seems like you were there for 10 years. You're buying credibility. So, I mean, what's the threshold that you're looking for? Is it like a year? If you're not turning, if you don't hit your goal, I need to be able to hit. - I need to be able to hit a three to four million dollar even a company within three years. - And if you don't, how long do you hold it for? - Well, I guess the question is, did you go into the right markets? Because, well, let me give you a good example. I'm never gonna be able to get that much money out of a Tucson. - Maybe. - But it's so close to Phoenix. It's just like Northern Arizona. So, if I go into an Atlanta, it's a lot different than you go into Savannah, Georgia. Like Atlanta, Georgia is way bigger opportunity than Savannah. But Savannah's not that far away. So, I go to Savannah if I could get, so you gotta look at the demographic and Valpact, believe it or not, has some of the most data. No, Valpact's still doing good. - Okay, I don't know. The head guy there of all the data was just my office last week. The shit that they are able to do. - Got it. - I gotta show you because you can take your whole database and upload it into there. Thing it'll tell you exactly who your ideal client is and how often to hit them. - Do you prefer Valpact over Dreck Mountain? Or do you think both of them do well? But my Valpact, so every single month, I have a meeting with all of our vendors for marketing. And it's the same deck and I give them all the data and it's green red, green yellow red, or purple's really bad. But how's our mailer doing? If they're in the green, I go, what other, can we put a double insert in? Is there more people we could hit here? - Or just keep it right. - And since I started doing these meetings, I mean, we've gone from 17% of revenue to 15% to 10, like Valpact's killing it for us. But in certain markets, I'm not even hitting half the homes because guess what? I don't have the technicians writing the tickets there. A conversion rate's not good yet. So I tell the guys, listen, I'm not gonna be able to get you a lot of leads until, I tell the managers all the time, I can't get you leads until you get the average ticket to this and the conversion rate to this. And it's true. And I tell these guys, don't ever complain to me until you get the performance better. You gotta have stronger one-on-ones, do more training, you gotta recruit better. 'Cause your market, I can get more leads, 'cause it's a return on ads back. - Let me do another question back to back to, before you go do Valpact magazine's Drag Mail, what else is there? I call this the TVC, LSA. - That's the TVC, LSA. - No, I'm saying hard print. So magazines of Valpact and Drag Mail are like the trio of print, right? So before you do that, and this is for your listeners too, do you, is there a certain amount of reviews, their GMB, their Yelp, their, yeah, so what we do is we do friends and family, for free for the first two weeks. Like we just opened up St. Louis. Day one before we got there, 'cause we did friends and family, we already got 65 reviews. - Okay. - When do you start dumping into Google? - I see you start Google right away. - Okay. - And even though they don't have that many reviews. - So here's what I did. I did exactly what you would think what I thought to do, is going super light, just focus on reviews, spend the first year, and then hit all the other stuff. Then I found out from like a company like Groundworks, Matt and Malone, they're doing like 280 million of EBITDA. He goes in four months before they're even in that market, it starts doing one ads. So people are hearing your name every day. A one is hiring great people, and you just make it, just for crew. - It's all, but people are hearing your name A one. - Of course, of course, of course. - A one, A one. And that's a lot of money to think about. You're spending four months worth of endorsements and radio and TV, and you're not making it at that, and you can't even run a call. But that's what it's gonna cost, 'cause people will remember you. And be like, who's that company all the time? It's hiring those awesome technicians. But this is the biggest thing. The next company that's looking at us is gonna say, how good are they at Greenfields? How quick can they go take market share? And if you build that playbook, that's worth more than gold. Because an acquisition is like, I might be able to get a good acquisition. - True. - But I can't plan it. - You're gambling? - Maybe. What I found though, when you go into a market like St. Louis and you're spending 300 grand a month, now everybody's calling you, St. Louis, and you want to sell, because you're gonna freaking, it's already expensive to market here, and now you're spending this much. I see you on the bus stops. I hear your name every morning. Like, we don't want to go. So now they're like, how do we do a deal? - Yep. And you're competitors see you as like, "Hey, my employees are gonna want to go work for you because you have. " - Well, hopefully they understand that I'm willing to lose money for the first 18 months. - Not only will you, you can too. (laughing) - Well, think about this. - You know, just like A-Track, the multiples are going up. So my question is, you get a million dollar of EBITDA company. What are you gonna pick up? What's the fair price for a million dollars of EBITDA? I know what they're getting in A-Track. - Six to eight maybe. - Some people are paying 10. - Yeah. - So the question is, on $8 million for that million dollars of EBITDA, you're paying eight. - Yep. - Could I go into there and spend $8 million? If I could spend five and get the same reaction. - You're right. - I'm way better off. - Yep. - Because now I'm building it with my same culture. And then you, here's the other trick. Pay your top guys 150 grand of move. Get them to move. You gotta get your top guys to move to a market. - Do you get that's an add back? - No, all the things you've been through right now, right? You, the green feeling, the acquisitions 'cause you're doing both. What do you enjoy the most and which ones giving you the best return? - Yeah, green feels been difficult, but it gets better and better and better. - To enjoy the green feel. - I would, dude, I would, I love to start from nothing and go on, you know. - You know, I bought some really cool companies, like Cody Johnson, you know Cody. - Yeah, Cody Johnson. - That guy's the hardest worker. I'm in his brother Ryan. You're never, like I've never seen that because they're just great and then Don's. The guy had been marketing there for 32 years on the radio. But they had an average ticket of like $400. So we go in there and this is what's so cool about knowing your numbers. As I'm like, well, they're booking rates 78%, we're 90. So you just pick them 12% there. The conversion rate, they're not working nights or weekends. They're running four calls, they're running like seven calls a day. I'm running three a day. So I cut their jobs in half, so now they can take the time. So my conversion rate's up, my average ticket goes up. So let's say you paid eight extra them, the effect of multiples two by time you fix these things. People don't realize that. I'm like, all that I care about is these numbers. - Okay, we slow it down for them because I want them to really get that substance that you just said, look at, you're running six to seven calls a day and then you're wondering why your ticket is $300 to $400. - Yeah, it's Wambam. Thank you, man. They're waiting for that easy customer. They're waiting for the easy one. The best guys I know they go to those hard clients and they take the time. And I say this, if your average job's an hour and a half, I'd like you to get to three and a half hours. - Yes. - It's just the time, I don't know. The people are spending the money when you're there for four hours with them. - Yes, look at people ask us how we were carrying a $21,000 average ticket at rent. We go in there for three hours with a certified technician, good looking, knows how to communicate, knows how to work on those units. He's in there for three hours, okay? Project manager, a company advisor will go in there for another three to four hours. - Yep. - Another three to four hours to educate client on different options of why they should replace their systems and you know make all these headaches will go in. And I get to know the clients they see who's sleeping in the rooms they look for inhalers they look for air quality they're looking at every they got to get to know the people diagnosed the person before the problem. Five six hours were inside that home and we come out with 20 25 thousand art tickets you guys I've mentored hundreds and hundreds of you guys and the first thing I ask you tell me what the technicians do every day. Oh you know we got a cause when it gets busy as you're running seven eight nine ten calls or running Saturdays and Sundays and I'm like so how do you expect to build any kind of trust any kind of value when you present a 20 30 thousand dollar average ticket when you've been there for 45 minutes. The other thing is that I look at is how long it'll take you to start that first estimate. So I do garage doors are a lot different because a lot of my revenue comes from straight repair. Okay I don't need I would be great to get a million turnovers but our gross profit on services way higher the the dollar amounts are not enough but just because the entire. And I had all these technicians a couple weeks ago they're like all we do is talk about turnovers now and I'm like they're like we used to be a service company now you just want to sell the doors and I said well I was a technician for a long time I run a lot of calls personally in the clients home. Do you think it's not right to mention it when it's a 20-year-old door and it's falling apart and the styles are coming undone it's not insulated the paints oxidize the trims messed up you're going to make a lot of money on a service call but it's the right if it were your mother would you at least say have you ever thought about a new door. Well one of the biggest mistakes that I see contractors do taught me and their technicians do and their project managers do is that they do the shopping for the client they do the shopping for the client they get in there like oh the capacitor is $390 for us to and I'll get you to see it's like okay did you guys give them options on replacing the a hard start kid a capacitor sequence a coil cleaning something like you guys cannot listen to me you guys cannot ever ever do the the shopping for your client that's not what you're there for your job as a technician or a project manager is to present three to four different options to make sure that you educate them and and let them let them mantle we just started with mantle and it's this thing that basically it's software that allows the client to kind of do their own shopping they scroll through that and this guy called me one of my product specialists is like dude he's like there was no way I was selling a three-star they saw the difference of the price because they went with the five-star and then they added windows and the crazy thing is with mantle just starting out with it a call presentation is that what it is a sales presentation tool so the first page it shows you all the work we've done in that neighborhood like and it shows you little Tommy characters so you see like this we've done a work for all your neighbors okay then the next page is a video from me and the next page it shows you what you need and then you get to add subtract but here's the cool thing mantle adds in my dealer fees do you own mantle by the way no okay guys we're gonna draw a bit because you should see how many freaking links we get on our group of like what's our friends in japan why service time stocks and that let's just say I think mantle is great for ten million dollar plus companies that's the and what I got to tell you guys is my conversion rate went from 55% on turnovers to 68 and a half percent and the average tickets up $1,500 but now it's the actual beast and and Aaron brought them to me and they were like we didn't make this for garage doors and he for 90 days made it I'm gonna person on my group because that's a what you'll dig this dude and sex is a really smart guy I mean these guys like it made a large impact in my company and now we're rolling it out to dawns a garage door doctor and the company's underneath and I'm like man this alone whoa increase that alone could bring in an extra 20 million dollars of EBITDA because here's the deal it's eating my dealer fees so now I can start marketing paying nothing till 2029 but the the clients paying the fee for the the dealer fee of course it's built into it and it's legal you got to show them a save you want this one but it's just a small monthly number so now like the cool thing about a garage door is I could do it for 20 years 20 years is that one thing that you wish the your team and your and your and just your industry in general did better better the financing I know I do not we're not good as a company I mean look right now last year we're 17% of our revenue came from financing I like this year Luke's goal is 30 to 35% I think we're 64% yeah that's a route that's probably the right number 64% was that next year and these bigger tickets people want to use the finance yeah so well could you imagine what it would do if you finance half of your and this is for your garage or people because garage or people in electricians Tommy sock at financing they don't they don't even sock at financing is if you just show them the price like yeah just talking 20 is stop talking 510 15000 and start talking for as low as 80 for as low as 90 for as low as a hundred dollars we could replace your garage or and guess what you you you it brings this warranty and peace of mind and and you never have to worry about it so yeah I like the idea so my buddy Rob that was just how he goes you're gonna spend the money anyway there anyway dollars uh right now you know how much air conditioning you're losing in the summer just out of this garage I believe you and if you add in the inflation 20% just say it's 30% your bills 300 bucks that's a hundred bucks a month the same monthly payment of what we're gonna save by the way the garage door seven years in a row remodel magazine the number one so you'd never say the cost you say this is the investment and then I show them right now we're building this health monitor it basically is like it's not your it's not new way it's we go through all these questions and it says you've got two more years left on the store the lifetime so it's like your tires on your car we've learned from discount tire that's so you could we could band a this and make it work for the next couple years and then it shows you your zillow price of your home today what it would interest after that door can let me ask you a question um and I don't want to miss this one do you you said something about uh repairs right now I don't want to miss I don't want to miss it um oh do you credit then this is what we do yeah no so I'll give you so here's the deal you get it up to a thousand dollars most of the time we'll say we give six months what now what I'll do is I'll say because I want to build urgency I want to say today and today only either we're gonna brace it or replace it I'm working on your door mr. Ishmael okay you want me to fix this thing a hundred percent okay what if I took the money we just spent and I'm able to work with my product specialists and apply some of this towards a new door well what we doing then and I I agree with how you're doing it so build the urgency well we doing the lecture and and this is for you the listeners to because most of you guys aren't doing this and then you guys are wondering why there's no urgency behind your calls so I think we give a three month or six month and we used to give it but I'm I'm sure they still do so hey as long as you know in the next six months you call us back and I know you're about to invest fifteen hundred dollars into this air condition and we you know we we smart we always tell if in the six if in the next six months you change your mind and you say hey you know what is you know I've been thinking about it you know those fifteen hundred dollars it's a seven year old unit I know I could still go on with it with this for three four five and more years I thought about it yeah let's go ahead and do it come back I want a new air conditioning so I could get those fifteen hundred dollars always offer and and and and the the don't go a year don't go four years don't go five years don't do that shit it should be three to six months you can always call back and get your money back applied to a purchase of a replacement system or in plumbing to a replacement of a repipe a tankless water heater water filtration electricians to your you know your panels and all that you're you're replacing breakers inside those panels and you're charging the customer four five hundred dollars hey by the way what really needs to happen here is this electrical panel needs to be upgraded and you really need to you know get it permanent all that yeah I think I think if you had a great mailer that went out let's call it amen there you go three and six months to say final offer yep and we just got this new program through our finance company and you offer the best one if you could do a handwritten letter that they open up with the hand because that we know gets open yeah I can get those now for like a buck 50 so it's a handwritten card same and it says we could take the fifteen hundred dollars off of your repair and you could programmatically build this within eight days so it's not a human being yes you can and it's a novellot but shows up you know it's gonna get read yes it's got a normal stamp on it it's got a return address on it it's got handwriting and it gets opened up and it says we got this program we could do this by the way it's 268% return on investment I'd bet you 30% of the people would do it all day long but the problem is our our contractors aren't you know really good at direct mail or follow up or putting these little implementations inside your operation like the buyback program or incentivizing the technicians to always bring that up inside the operation like all those little things guys is what you guys are missing and what's keeping you you know under the ten million dollar mark well let's talk about a couple more things here so personal brand you're you're one of the biggest things I think with this AI world is just build your personal brand I've been going so hard and you're but but it's so important it is I mean Rayna PayPal came out and said the personal brand of the CEO is important to the company itself yep for talent recruitment for clientele everyone should be so everyone I'm working with a coach right now and you know much Alex Ramose spent on his book lunch no eight million cheese so I'm looking at how could I do that maybe ten million on my book lunch all I want to do is get my money back I don't want to make money I don't want to make money in the book lunch I I want to grow a personal brand. - Personal. - Look, I saw it's this thick on also that said, your personal brand is 20 times more effective than your company brand. Your personal brand is 20 times more effective than your company brand. And look at just to give you guys a, why it resonated with me. My following on new pages like, you know, I don't know like 5,000 people. My following on my Instagram and Facebook pages like over 250,000 people now, like your personal brand is way more powerful. And everybody in the home service industry listened to me because I told this to you too. I told this to you. I told this to Chad to AG which he still hasn't gone his ass in there. But you guys for the next three years, it's all put a freaking camera in front of you guys. And just pretend it's not there because you will catch the most dopest moments in the best of years. - Yeah, yeah, if you get it over, at work, I mean, that's what these guys are working on is like in your natural habitat. And I think it's super important. And I think certain PE companies probably are like, that's a waste. - Yep, no. - You understand the deal flow, the connections, the learning that happens. And this is where you connect the dots back to the company. Every single video that I post, what am I rocking? My new Vihat, my new Vihat. - It's a little learned up. - I'll tell you this, I just had a really good meeting with a guy who's got tons and tons of tons of followers, like 700,000. And I said, "Do you ever get caught up in the vanity metrics?" And he says, "All the time." And Rob Williams would say, "Roy Williams would say, "Hey, you want to just get as many people as possible "because they all have friends." But I know this girl, she's making 200K a year. She's got 900 followers. And it's all sold to those 900 people. Is that what the right followers that trust me and know I'm giving them good answers? - How I measure my personal branding, affecting my business by the revenue spike when I'm putting a content on. So meaning, if I didn't have, if I had all these followers, 250,000 plus followers, if I had all those followers, and Nouveau wasn't doing shit, and we weren't closing deals, and we weren't increasing our MRR, we weren't selling, we sold 14.2 million dollars of fucking thermosets in our first year. If that wasn't happening, then I would stop the personal brand. But because I know how much it's affecting my actual baby, Nouveau, that's why I keep going so hard on it. That's why you always see me with my Nouveau hats. That's why you always see me talking about it because the personal brand is feeding it. You said it best, and this is one thing I'll never forget. You told me, you marketed for A1, how'd you say? - Yeah, so basically A1 built my reputation. - That's what you said. - And then I'm rebuilt, and now I'm doing it back to favors. - Amen. - And A1's a beast. - Bro. - And that's why people are like, "Man, if A1's on this, it's gotta be good." Even the way at least the vehicles are the finance companies. So now I'm able to negotiate for them because of how quick big we've got, but they're like, "Dude, you've been podcasting for a decade. "You're writing books, you're talking on stages. "You start doing that, get comfortable with that. "You become a secret weapon." I mean, if we put our name on something that we believe it's gonna do well because I've never really did anybody wrong. I just, I talk about mantle. I'm like, it's a great software for the right person. But I don't have secrets. That's why when people come to my shop, I'm like, "This is everything we're doing." - I think that's one of the, that's one of the things that nobody really gives you enough credit for Tom. How many people have been through your shop? When I was at an action, we had hundreds of contractors there. Every Thursday we would have people come in and just tour the shop around for a day. And that's one thing you do for our industry. And I think that industry's always gonna pay you back for that. - They do. - And that's why, you know guys, I guarantee told me try this, do this. Half the stuff he tells me, I don't do it because we look at it and say we've already got some for doing this. But every once in a while, it doesn't need to be airing. It could be somebody and I'll go, "Anybody." - I just told you, 15% higher conversion rate, $1,500 more per ticket. Because somebody was willing to call me and say, "You've helped me out enough. I'm gonna repay you the favor." You know what I think people do really wrong time that they need to do a little bit better. They need to start paying attention to those little golden nuggets that people drop because look, I'll give you one example. When I was growing my social media following, I was just doing 30 second, 30 second, 90s, quick. And then I had a meeting with Ty Lopez and he's like, "No, no, no, no, you're doing it wrong. You're doing it wrong. You got to fucking start putting two, three minute content and I just saw the fucking. - Okay, good. - Spiked up. - Yeah, you gotta listen to people you don't. - Yeah, that's why I got. - One of my lets work with me is like, dude, he's like, "This is gonna be fun." And they're like, "You're doing it wrong." And so I'm just listening to the playbook, hiring the right people. And then we're gonna start treating the content like we do the business where how many people watch this video. And then you change it. And you like, I must say, we haven't been running the social media like a business. And now we are. - Good. - So what's up, a new way? - Good man. So, you know, first year, 14.2 million dollars ended it. I'm super proud of our team. - I'm gonna demo you guys doing a day. - Bro, on a slow day, we're doing, and look, it goes back to how sales oriented I am. Okay, and how sales driven I am. We're probably doing six days demos a day. Right now, for the last 45 days, knock on what please keep letting it go through. We're closing about two to three deals every single day. But the one thing that we are is a fucking sales machine ton. Like we have 20, some of these SS companies that I talked to, and I'm like, okay, how many STRs do you have, which, you know, are leadsetters or how many AE's, which are sales guys? Well, it's the same thing to contract them. And I always ask them and it's like, oh yeah, I got two STRs and I got a couple AE's. It's like, no wonder you're stuck with your hat. Like you need to turn on the fucking gas, bro. My goal is to have 50 STRs, listen to me, 50 STRs by Q2 of this year. And I wanna have 15 AE's running to appointments every single day. If I get there, it took service time 14 years or 12 years to get there. I'm gonna do that shit out there. - So are they just doing outbound? - Outbounding, yeah. Outbounding trade shows. So I'll try to bring around the trade shows just so people could put a face on it. You know what's the one thing that's funny to me? When contractors see us at a home show, at a freedom event or at a pantheon, the first thing that they come up to me and they say, "Each man, your people will not stop calling me." Yeah, you know why? Because they're incentivized. They're incentivized to call you. - Let me ask you something. So a stat that I'm really would be interested in, if I'm you, running new day, is I be looking at a graph of purchases by a company. I expect those purchases to go up. Because what I find the biggest mistake is people chasing people coming in the front door but don't realize the back door. 'Cause what if you could get every single company to say, "I'm gonna start including these and every service call." Or I'm gonna start including these and all my never membership and all my goals. - My goal, Tom, and we're almost there. In the next 90 days, we're gonna release our third version of version one, which is knock on wood, we're gonna be able to sell thermos that's for $99, which would frickin open up the floodgates to-- - That's really common. - That's what me and you talked about. - I said, "Figure our way to give that one." - Do that one. - Ever since you told me that, that $99 thing has stuck to me, contractors will give a $99 thermos that wither logo and all the technology behind it to every single customer if I could give it to a $99. You know what it's gonna do to a money world and all those guys? - I told you. - Forget about the EBITDA game. - Oh, play the ARR game. - I am. - Because that's such a better deal that you've got the ability to play both. - So if you're not playing the EBITDA game in the beginning, it's a crushy because it costs a lot of money 'cause you gotta wait for the membership. - Exactly. - That's where you said. - So now that I picked up the memberships, now I could decrease the-- - Yeah, because now you've got this money coming in there. - Of course. - So now it's kind of self-fulfilling. - The next six months for NUVA, Tommy, are probably gonna be the most insane months. My goal is to take NUVA IPO by the end of next year. I'm hired a bad ass here for, I have my suit, my suit. - Where do you wanna be an ARR? - By the end of this year, I'll probably be 24, 26 ARR. - This year, the WRIPO, what do you wanna get like 50? - 48 to 50. - 48 to 50. Mill of ARR and I think-- - What do you think it's worth? - Multiple wise, have you talked to anybody? - 48 to 50 million dollars of ARR, you're probably close to 800, 750. Because we also pick up on the thermostat, Tom. - So you're like 20 acts, you think? - Probably lower than that, but we also make a ton of money on the thermostat, too. So we would, I talked to Tom Howard, and he's the one that told me this. We're running 39% gross profit right now with our thermostat. Sophia, which is our version two with voice and monitoring and it's just a sleek, round, beautiful thermostat. We're gonna sell it for 289 as a premium thermostat, and it's gonna pick up about 11 points, 10 to 11 points of gross profit, my CF already calculated it. So we're probably gonna be running about 50% gross profit on our thermostats. - When you run a $99, is this gonna blow? - Oh my God, bro. Because look, I'm covering both bases. I have a $99 thermostat. - Maybe you didn't. - I'm not gonna trade. - And $99 thermostat, and then I have a $289 thermostat. One is meant to give away the other ones for memberships and the other ones for new installs. Those are the three tiers I'm trying to give. Once we open up the floodgates to that, bro, well, let me tell you how exciting our version to is. We have almost $500,000 of pre-orders paid for already of people waiting for a much thermostat. $500,000, $520,000 of pre-order thermostats of people waiting for that thermostat. - Here's something I think about. What if you did mailers? - And you said-- - I did. - No, you did them for you. - Yeah, for Nube. and you see. So for $99 will come to go to a tune up. And then for every one of those you said, if you sell, if you, I'm just thinking it would cost you money, let's say it cost you $50. And you just say, hey, I'll ask him for, I got you a tune up. - Do you need to be in the inventory for them? - I got you a tune up. - Okay. - You got a putter mustad. - Yep, you got the putter lead. - It's $99 bucks including the thermostat. - Well. - But now you're in the door. And all you gotta do is you gotta pay me $100 'cause I just, like, you do all the marketing. - That would even aid you to. - But then you're actually in control of your own destiny. - Of course. Right now we're waiting for them to. - We're waiting for them to sell 'em. - Yeah. - So now you say, I'm gonna give you these leads, you gotta sell them. - Hey, you know what would be better? If for X amount of thermostats, I'm gonna dump X amount of money into your marketing budget and direct mail for free thermostats or for free tune ups or whatever. If you sell 100 thermostats, we'll dump whatever. $5,000 or if you-- - But whatever you could generate $5,000 leads per market. - Oh my God, bro. - That's $5,000 in the thermostat. - These contracts are for them, bro. These contractors would be loyal to our brand. - Oh yeah. - Because this is what I've told you since the beginning. We're not a thermostat company. - Nobody's outfiring that. - No. - 99 bucks with a new thermostat. - No. - And I control from my phone. - No. - So you drew up the right ad. You could even do social media ads. And if you could generate-- - For cheaper-- - If you can figure out that it costs you $50. But you're getting, I didn't have to look. I mean, you're see if I could figure out how this could scale, 'cause obviously the more homes you're in. - Yep. - How many of you guys in right now? - 34,000 active units. We deployed about 78,000 units already, our first year. We have a company called Top Line, here in their connection in Pennsylvania. - Good guy. - And really, really good fucking all social media ads. They were running two-nup ad, I mean, they were running free estimate ads. And they were getting the regular conversion 15, 20% on social media. And then they started putting a free thermostat on their ads in a spite, like their conversion, like 15, 20%. - Well, now they're not as thermostat, especially if you could say it's a smart thermostat. - It's a smart thermostat. - So it's gonna lower, it's not gonna be, like if you could prove that it saves a few hundred bucks a year. - This is the one proud statistic that I'm most proud of NUBE, and the technology that we have behind it. We are generating between 6,800 to 7,000 logo clicks a month for our contractors. Meaning, listen to me, meaning, those people would have been searching for you online. - Because-- - Yeah, so they're clicks to book. - Yes. - 6,800 to 7,000 on these 34,000 units that are active right now. So we could already predict what happens at 340, at 3,000-- - That's all thing that NUBE does. - NUBE does. - We keep people away from Google. We keep people away from Google and online. - We can book the call through the app. - Through the app and the thermostat. - And the thermostat. - We just finalize our deal with service titan. They're gonna be able to dispatch a technician from the thermostat and that, meaning, Hey, Sophia, my water heater's not working. Can you send me a technician? It'll dispatch a technician from your voice all the way to your dispatch work without talking to a CSR. Hey, Sophia, can you turn on my AC to 72 degrees? Hey, Sophia, my AC doesn't seem to cool off. Can you send a technician? And it will give you the slots of, hey, today at 1 PM, tomorrow at 3 PM, and you click confirm, dispatches the technician without ever talking to a technician. That is one technology that I'm super proud of. - You can get that fucker and not. - Oh, we're done. - Million houses. - Oh, it's done. - I'm gonna be right back. - California compliant, meaning you're fucking compliant in the world. - Yeah. - We have customer satisfaction sheets. We have everything on NCU. I wanna build the first digital university for contractors where they could actually get educated. Because I know how bad it feels and I know how bad it is to run an unprofitable business. - I think the biggest problem with most companies is they're the bottleneck. They don't have the talent. - All they know. - And they're the data. - All they know. - All they know. - You know, they know just enough about the trade, but they don't know anything about the money. - They're great operators. Most of them are mediocre. Sorry, they're okay operators. They're missing the most important thing which is the marketing themselves, man. Marketing themselves is where the money's at. Marketing themselves is where the gold is at. - Yeah, dude, you drive the right leads, but by the way, sales come from marketing to the right people. People always ask me, "How do you get clients pay that?" Like I'm very careful on who I market to. - Of course. - And I'm not trying to be discount city. You know, I don't wanna attract those type of clients. - Amen. - Close us out, brother. Any final thoughts? - Bro, thank you for always having me on Tom. We have a badass group of people meet between me, UAG, Travis, Tom. You know, what we call ourselves LSD. Like I believe we are probably one of the most impactful people inside our industry. And the best part about it all is that we're just willing to give it all for free to our contractors. - That's good, man, because I think half-men will do a deal here in the next year and a half. - Peter, man. - Peter, man, Zilla, A.G. - So at that point, we've got like seven of us that have all done deals. - Yep. - And that's what happens after that. That's gonna be the interesting one. - We're gonna do more deals together, but like, it's billions and billions of dollars just between that small group. - I know. No, so I think we work with you, brother. I wanna do a lot more with you in the future, but we'll go out here and enjoy the party. - All right, let's go. - Thanks, brother. - I appreciate it. - Hey there, thanks for tuning into the podcast today. Before I let you go, I wanna let everybody know that Elevate is out and ready to buy. I can share with you how I attracted a winning team of over 700 employees in over 20 states. The insights in this book are powerful and can be applied to any business or organization. It's a real game changer for anyone looking to build and develop a high performing team like over here at A1 Grasdorah Service. So if you wanna learn the secrets, so how may transform my team from stealing the toilet paper to a group of 700 plus employees growing in the same direction, head over to Elevate and win.com, for slash podcast and grab a copy of the book. Thanks again for listening and we'll catch up with you next time on the podcast.