Joseph Trave's Hardest Deal: Letting Go of His Own Business

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0:35Founders Forum is a radio show and podcast where entrepreneurs share their journeys, reveal the stories behind their successes, and the lessons they've learned. Join Mark and his guests for a mix of inspiration, valuable insights, and a bit of fun. Now, let's dive in. Good morning, America. How are you? Good to be here this morning on this sunny day in Philadelphia. So I'm here with my guest, Joe, who I'll formally introduce in a minute, as I always do. But Joe, topic of the day, I'm going to call this expansion towards exit. And it's a topic that I'm talking about almost every day now with business owners, because I deal with a lot of business owners in my business that are headed towards exits.

1:18And I know you're going through something with that, and it has to do with acquisition. So it's always, and I know that there's decisions involved in that. Very difficult ones. Yeah. So tell just the experience around it. We'll get more into your business, of course, later. You know, what you really struggle with as you grow a business is capacity constraints and where those constraints are in your business. And over the last couple of years post-COVID, we really ramped up our business and put on a proper sales team. And we expanded our current facility. We're at about 80 ,000 square feet, 125 people.

1:58By the way, on your website, you have a large leadership team. We have a large leadership team, yeah. So I could tell that you have... I'm thinking about all... I surround myself with a lot of people that are smarter than I am, and they've told me I need to surround myself with great leaders, right? And then trade. Well, you are smart because you're doing that. So I made it through high school, you know, we'll see. So what I've come to find is that, again, talking with other entrepreneurs that have scaled and exited, you know, there's a certain sequence and there's a way that these businesses are evaluated and, you know, obviously on multiples of EBITDA.

2:40And then there's growth constraint in manufacturing. So manufacturing has constraints based on manpower handpower and space and time, right? How many hours in the day? So like we've currently gone to a second shift and you're not gonna get what you get out of a first shift on a second shift. It's just, it's definitely reduced output. Human nature. Yeah, but so currently I am in the process of talking to several companies, isolated down to one or two that I believe would be good synergistic brands for us to continue to grow the business and then eventually exit at some point. So I'm not there yet, but I know my wife, who's been along with me all the way along this ride for 27 years, she'd like to see the end in sight at some point.

3:36So we have that conversation on a daily basis. So I mentioned to you, as we were talking about this topic before we got online, a little video I did yesterday about what does life after business look like? One of the most important pieces of advice I can give you is because you've been, as we're going to see, you're a hard driving business owner that's pretty much poured his whole life into this. Absolutely. So what happens after that to make your life the way it should be? And you don't have to answer that. It's just something you need to think about. It's a great question. Right, right. Something you need to think about.

4:10So my guest today is Joe Travi. And I do know how to say his last name correctly because I remember his family's restaurant, which is part of the story. And he is founder and CEO of Village Handcrafted Cabinetry in Lansdale, Pennsylvania. And Joe started, as you'll hear, as a small 400-square-foot woodshop in his parents' backyard. And he's grown it over how many years? 27 years? About 27 years. 27 years, yeah. into a world-class, highly custom cabinet manufacturer employing over 125 skilled craftspeople, which is amazing. Congratulations for where you are today. Thank you. So I know you're going to be hard on yourself, but I want to make sure.

4:50I don't dwell on all of those accolades. Helen and I, Helen's in the studio with us too, by the way, Helen Denise, and she's sitting in, maybe she'll contribute a word or two. But we were talking about how important it is to look back on your successes, look at where you are today, and then look forward, not just look forward while we're beating ourselves up with entrepreneurs tend to do. Yeah, most entrepreneurs really are tough on themselves, and that's how you get here. Right. So anyway, let's talk about from the beginning. Sure. So you grew up in the area, the Philadelphia area, and what did that look like?

5:24So I had the idyllic childhood of the 80s, riding my bike everywhere, and my mom would tell me to be home by dark, that kind of thing. I had great parents, both entrepreneurs. Um, and, uh, so yeah, my father lost his job at 50, uh, and started a restaurant business. Um, always wanted to get in the restaurant business as, as an old Italian guy. And so he opened, uh, uh, was he a cook? No, no. I mean, he enjoyed it, but, uh, you know, he just, um, yeah, it was, uh, so he bought a small diner in, in North Wales back in 87. And, uh, I was, I was a kid at the time. So I started bussing tables at 12 years old and washing dishes at 13.

6:06By the way, what was your mom? What kind of entrepreneur was your mom? She owned a very successful medical auditing business for insurance companies and doctors. So she had a great career and ran a very successful business with a partner for many years. And so they were both, and they had several businesses at that time. They owned a little Catholic gift store. We ran a little pool stand at the local pool. So my parents were always in business. And so I saw that growing up. And my father, I think after he, so he worked at a very large manufacturer in Plymouth Meeting from the time he'd left the service until around 47 or 50.

6:46What company was that? It was called Kaiser Aluminum. So yeah, it was where the Metroplex is. And he almost bought the company and it didn't work out. Chemical Road, right? Yeah. So he kind of ingrained in me early, hey, don't put your life in some company's hands. Go make your own way. And so I got that bug pretty early and started the restaurant business and ran that course for about five years in high school thinking, okay, I want to open my own restaurant. And I did at one point with my father and some of my family. Is that right? A different restaurant? Yeah, we had an Italian restaurant in Lansdale.

7:26I opened that and did that through college. But simultaneously, I went to trade school during high school and always loved carpentry. And I was obsessed with carpentry. And I watched New Yankee Workshop and This Old House religiously. So I'd VHS tape and rewind it and just watch it religiously. So I was a little obsessive about woodworking. My father would like to woodwork. And so we built this little shop in the backyard when I was 18 or 19. and he was good enough to do it. And it was like a father-son thing. Hey, we're gonna have a little wood shop. And quickly I realized I couldn't stay in the restaurant business my whole life.

8:06The nights and the weekends and just staffing issues, really, really challenging business. Still, I understand that business well today. My brother-in-law still owns one. And so I decided around, I'd say 22, 23 years old that I was gonna leave the business and give woodworking a shot. And so... By the way, you told me your dad really encouraged that. He did. So I was just married at the time and my wife had a great job in software world. Prior to Y2K, she was programming ones and zeros to make sure the world didn't collapse in year 2000. So she had a great job. Remember that? Had benefits, right?

8:45So I needed benefits. And she supported me as well. She was just very supportive of me and said, hey, let's give this a shot. She built me my first website when like, I mean, websites were, yeah, this was 98. And so we grew this, you know, little business in my father's backyard. And he actually got cancer at the time. And so I got to spend that last year with him. Almost every day he sat there and he went downhill very fast through chemo. But I got to spend that year with him and grow this little business. I have often said I would print up loose leaf and put my number at the bottom and slice the numbers and put it at Wawa.

9:28And that's how I got work, right? So I made business cards, little trifolds, and put signs out out front in people's homes. And basically, I'd do anything, right? You want crown molding? You want a mantel? I would do it. And it would work, basically. And it would work. And I'd figure it out. And people would say, I've told this story before. very, very good clients of mine locally, a great large business, a large family business. Hey, Joe, can you make baby gates? And I said, I make them all the time. And I get home and I said to my wife, I'm like, how the hell do you make a baby gate? So quickly you figure it out, right?

10:02So

10:05you're scrappy, you're entrepreneurial, and you got to somehow keep a roof over your head, right? So I had a wife, my daughter was shortly born after that. So all of a sudden I have a family of three of us that I'm concerned about. And I knew I wanted to grow the business. So my father had passed. I spent a year there. I was the youngest of four. So my mom was still there in the home, our family home. So it was a good time for me to transition there. So she was going through, just losing my dad. And so I spent every day with her. I'd have lunch with her. I'd go back into the shop. you know she'd call me hey joe it's lunchtime you know like how great is that you know where were you in the birth order here i was the youngest of four yes three older sisters so always around women um so and i sell to mostly women so i'm i'm i can you know my wife gives me a hard time oh joe and his women you know the charmer yeah yeah so you get used to that um so my older sisters always had their friends around and i would try to i try to charm them and I was 10 years old and they were 20, you know?

11:10You probably did pretty well. They thought I was very cute. They're like, get out of here. I'm sure, I'm sure. So anyway, so the business took, you know, gradually took off. And so eventually I needed more space. I was spraying outside. The flies were getting into my freshly finished furniture and whatnot. So I found a gentleman in Quakertown and he was looking to retire. So I bought the assets of his business, very small. I was doing maybe 200 ,000 at the time, but I was doing 100 ,000 at the time. So quickly, I'm growing. You went to his location? Yeah. So I moved to Quakertown, about 4 ,000 square feet.

11:47And it was a great foray into the kitchen business. So he taught me the kitchen business, and he became a mentor of mine. He was my father's age, so it was good timing. Kitchen meaning cabinets, probably? Kitchen cabinets, yeah. And so I didn't know what I didn't know. I was building wall units at the time with big screen TVs back in the day. You know, everybody had a big screen TV, so we'd build it into some big wall unit. Right, sure. And then I really, but the kitchen business is where, you know, in the cabinet industry, the kitchen is the heart of the home, right? Yeah. So it's very. That's the heart of the business.

12:19Exactly. So he taught me the business. He stayed on. I paid him, you know, to stay on. And he stayed on with me for five to seven years and really was a great relationship. And then my family joined my wife. So by the way, that sounds like it's your first experience of kind of hiring a mentor in a way, right? Exactly. Yeah. And it's funny. This concept will come full circle to where I'm at now. But so, yeah, we grew the business. My wife joined. She lost her job during the dot-com bust in 2001. Okay. Right. And so she was part-time. We had two kids at the time. And so she took the package and she came to work in the business and started marketing, right?

13:03Starting cold calling builders. Is that what she still does in the business? She's a director of marketing in the company. Yeah. And my sister joined and my brother-in-law who left the restaurant business with a couple of years after I did. And I was looking to grow and they were looking for a change. So they joined and we spent 18, 20 years together, right? As owners, four of us. And, you know, for the most part, it was a very good relationship. So they were all owners in the business? Yeah, we were 25 % owners. And, you know, established some challenges here and there, you know, between, you know, as family, business can be.

13:40Sure. So we moved to Lansdale in 2006, bought 25 ,000 square feet of space. Was there eventually a buyout of the other owners? Yeah, about less than a year ago. Yeah. So my sister and brother-in-law retired just recently. It all worked out well. Worked out really well. They love retirement. And I like being the sole owner. You know, my wife and I are 50-50, but we own the business now. And so, yeah, we scaled the business. Real tough time was 2010, you know, 2009, 2010 during the downturn. That was, that's kind of a, you know, that four years for me is like, I have a lot of PTSD from that time.

14:22Your timing is impeccable because we have to take a break, but I want to come back. I was going to ask you about challenges, so that's a great place to begin. So we'll be right back on Founders Forum. Establishing a self-directed Roth IRA or other self-directed retirement plan offers access to investment options usually only available to well-connected or wealthy individuals. Anyone can build wealth and achieve tax-free income for life and financial freedom without the inordinate risk of speculative investing, securities, trading exotic financial instruments, or hoping for the best from the stock market.

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15:34We're back on founders forum with my guest, Joe Travi, and we have Helen Denise here in the studio with us. And Joe, so we're talking about COVID. You know, obviously that affected your business. I'm guessing it probably was very tough at first, but it also might've presented some opportunities. But what did that look like? Tough, obviously for four to six weeks, right? We were closed down. But it was really nothing compared to the Great Recession in my mind, right? So COVID exploded our business in 2021. Because people were staying home. And they were given a lot of free money. The government just doled out.

16:12So they were spending money left and right. So it was almost like a feeding frenzy of sorts. But looking back to 2010, 2009, 10, 11, 12, that really is the PTSD that I struggle with because the housing industry was decimated, just decimated. And all my friends that were in other businesses, Big Pharma or whatever, they're like, the economy is great. And I'm like, what? We were living in the same world. I wasn't even living in the same world. I thought they were repelling my cars, right? I mean, the bank was calling my notes. I mean, it was bad. And so we really struggled. I didn't know how I was going to pay the bills, right, on a daily basis.

16:59And so it creates like kind of a wound that you're always fearful of now, right? So I still have PTSD. Like COVID for me was just like a blip, you know? It's like, yeah, a couple months, right? By the way, anyone who's been in business during those two periods, and I even go back to before 87 when there was a big correction in the market and all that. It was very early in my career. But anybody who's been through those has some lessons and has some natural shell shock that accompanies that, that you always have to be careful. So like my VP of finance, she's always like, ah, our cash position's fine.

17:33I'm like, no, no, no. Like we need more cash just in case, you know? So, you know, our line of credit, don't touch our line, you know, that kind of thing. So I wanted to go back to something else. I want to ask you about your company culture. Sure. Because I know you built a good one. And I mentioned that it started, it was just an observation on my part, that you learned a lot from the fellow that you acquired a business from. And I know offline we've talked about the fact that you've hired other leaders that support you and help you. So let's talk about that, your philosophy about that, and what your company culture looks like today.

18:05So you learn from everybody you surround yourself with. And about 10 years ago, a former client from many years ago who scaled his business in my town and exited very successfully, I did another project for him. And he started becoming a mentor of mine. And he said, hey, I just want to see you succeed, right? So he said, I think you need to build a really strong leadership team. You need to build strong people around you. and this is how you're going to get there. So we put in place an executive leadership team of six and then we have a broader leadership team of about 12 that help run the business.

18:48So the goal is that I don't have to be there 24 hours a day and we're getting there, right? We're putting in leadership training. Culture is everything. I have an amazing director of HR and she is really taking the business to another level of how to engage people. I think I was telling you off mic about a Gallup survey we're doing right now to try to get a baseline of where our team is and how engaged they are. So then we can try to ascertain how do we grow engagement, right? So we're all pushing forward in the same direction. It's really hard when you feel like you're driving a bus and everybody's on the bus just as a passenger.

19:33We need everybody in a boat rowing in the same direction, right? Now, by the way, so that's your leadership team, but then you have 125 or so employees, 130. Correct. So what's the culture like with the whole company? I would say it's a very busy place, right? So you could see stress on a lot of people's faces, right? Because we provide an extremely high-end product that has to be perfect. Not kind of perfect, it has to be perfect. By the way, I should mention you've evolved to its high-end cabinet. of all kinds. So we sell high-end custom cabinetry for the whole home, really up and down the East Coast.

20:08And we'll go out West as well. So, I mean, we do large projects all over the country. So, yeah, so the level of work is very hard. It's hard work, but the best cabinet makers and finishers and designers want to work for companies like ours where they get to be challenged. We're not building just, we're not stamping out boxes all day that hang on a wall, right? These are very, I mean, we'll build a bunk bed, a set of bunk beds that are$100 ,000. So these are extremely complex projects for affluent clients that demand extremely high level of work. So culture is a challenge. By the way, I looked at your jobs that you're posting and what you're acquiring of those people.

20:50You're looking for high-end people that like challenges. So we say we have the best team in the country. right we are building the best cabinetry in the country i need the best team and i continue to tell the team like you're like you guys are the best right right like if you're not gonna not everybody makes it here so it it whittles down people fairly fast if you're not up to up to snuff so they and they recognize that amongst them there's got to be a feeling of accomplishment i would like to think so and you know when i walk the floor every day and i say good morning hey bob hey Tom, hey Pat, you know, I get a lot of, we try to be a high five culture, you know, a lot of fist bumps, hey, look at that, what are you, oh, that's so cool.

21:33By the way, for a company that size, it sounds like you know all your employees. I try to, yeah, yeah, and because I'm one of them, I mean, I tell them, hey, if the toilet needs cleaning, I'm cleaning the toilet, right, that we're all, you walk, if you see it, you own it, right. And you've walked the walk, you've done that work. Right, and I can still do it if need be, you know, and I say, hey, And if you don't show up, I might be on the bench building that cabinet, right? Right. Interesting. Yeah. So let me ask you this. I just want to check something really quick. Yeah. So if this were three years from today, Joe.

22:05Yeah. Because we've talked about a lot of things are going on. And you look back on the last three years. What would have to happen in your business, in your life, for you to feel like that was a successful period? You know, one of the things that I continue to be challenged with is time, right? So I've traded time for money. So maybe I've done well, so I've got some money, but I don't have a lot of time. And my wife really and I are talking a lot about, and my children, about, hey, when I have grandkids, I want to be around. I was not around when my kids were in sports. I was always working. How old are your kids now?

22:4325 and 23. So you could start thinking about it. Yeah, I really am. and my wife's like, hey, how do we start to evolve? And I think part of that is this acquisition to continue to grow the business to eventually hopefully exit the business, right? And whether that's an ESOP, whether that's private equity, whether it's a strategic buyer, that's my daily thought process. Let me ask you this. But is that the solution, the exit? Or do you want to start making more of that time evolving towards that? Building this leadership team, there is some thoughts behind, could I run the business with a leadership team and not be as involved on a daily basis?

23:29My personality, I struggle. I'm an all-in guy, right? So if I'm in, I'm in, right? I was going to say before, when you're talking about the leadership team and what you're doing with them, the next step is you have to let go a little bit. I really struggle with letting go, right? So when I come into a meeting, somehow I take over the meeting and I struggle taking a backseat. And my wife will call me out. She's like, you're doing it. You're doing it. So there's some work to be done there. I have a lot of work to do on myself now. Well, look, that's part of growth. That's part of evolution, right?

24:03Yeah. So I was going to ask you, what challenges are standing in the way? So one of the things is obviously you want to move towards being built for some kind of exit strategy. Yeah. What else is part of that vision? My vision is eventually to have the time to enjoy life a little bit more. And that's, you know, and that I think you get accustomed to a certain lifestyle, right? Right. So now the lifestyle predicates the time. And so you just continue to trade that. I'd love to have more of a balance. And I hate that term because in business. But you almost imply that if you step back, you won't make as much money.

24:41Well, yeah. Which probably isn't reality. I know, I know. And we talked about that earlier. Maybe if I let go, I'd, you know. And it's not really the money so much as I want to see this business grow and I want to see it be the best out there in the country, right? And, you know, internally in my industry, I have people from the West Coast say, who is this company Village in Lansdale, Pennsylvania? I mean, who are these people? And they hear this from Seattle, Washington. So it's pretty cool that we're getting that kind of recognition nationally. By the way, my mind was blown after you and I spoke because I drive by there.

25:17I told you I go to a car wash right down the street. Yeah, sure. And I never noticed it. Yeah. Now, my son, who you're going to meet, he said, oh, I know that place. Like, you drive because it's very impressive where it is. Well, cool story about that building. There was cannonballs produced in there for the Revolutionary War. I read about that, yeah. So, I mean, the fact that we're building some of the best cabinetry in the country right there in Lansdale and that old cannon factory, it's pretty cool. Pretty amazing. Yeah. So what, quickly, what challenges do you have in terms of that vision of like getting more free time and building towards that exit?

25:50I know one of the challenges is yourself. I think, yeah, that is one of the challenges, again, making sure that I have the right team around me, right? And making sure that everybody is in the right seat on the bus, right? Because you could have the right person, wrong seat or, you know, or vice versa. So, you know, looking at the acquisition that I'm targeting right now, I think the synergies are there, right? It could really help us scale our business. Will that bring on some people to help supplement you and your team as well? We would, you know, there's synergies between the two companies and different markets.

26:21Right. And that helps us expand rapidly, right? So, I mean, we could do a 50 % growth in a year here. So, you know, but that's risky. So, I understand the risks as well. I have one last question for you. If you were speaking to your younger self today, what advice would you give you? Stop and enjoy, stop and smell the roses a little bit more. Yeah, I haven't really done that a whole lot. And that's one thing I'm challenged with. I know you're a lifelong learner. Do you read? Are you a reader? I'm more of a podcaster. Podcaster, okay. Yeah. Oh, well, welcome. Yeah. ADHD, it prevents me from reading too much.

27:02Well, that's why we do a 28-minute show here because it's for entrepreneurs, right? You can absorb that, right? 28 minutes, unlike Rogan at two and a half hours. Yeah. See, I hardly ever listen to that. It's too much for me. Yeah, it takes me a week to get through one. I know, same with me. Well, listen, thanks so much for being here, Joe. Thanks, Mark. I appreciate you having me. Time flies, you know, as we're having fun. We thank all of you for being here on Founders Forum today. And thank you, Helen, for sitting in with us again. And we'll see you next week on Founders Forum. Founders Forum was brought to you in part by March Forward LLC.

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