248 - How to Close 3x More Sales and Build Your Own Drywall Empire with Jared Kotter

0:00You are going to hear how a middle school teacher went from no experience to$1.7 million in 10 months launching a drywall business. The goal is to do almost no labor. I'm not like with a drill gun like putting up. You can go to the city and just see what permits have been pulled. That's exactly what I do. The deal I have with the drywall companies that I keep 50 % of the net profit on every job that I sell. I knew nothing about drywall. Like when I started January 1, I literally didn't even know what direction the boards like went on the wall. If you don't have an unfair competitive advantage when you're getting into something, you should definitely rethink what you're getting into.

0:32You don't have to be an expert in anything. Just find a contractor that has this problem to be solved and you could sell for them.

0:41All right, welcome to Nickonomics. I am with Jared Cotter. And on today's episode, you are going to hear how a middle school teacher went from no experience to$1.7 million in 10 months launching a drywall business. in a space he had nothing to do with using kind of his secret method of closing at three times the average rate it's pretty incredible when i saw it on twitter i reached out to him and said i have to know the entire story and you're going to hear it today for the next 30 45 minutes so strap in so my first question jared to you is what the freak is your business what is a drywall business yeah so we do drywall for custom homes i mean we can do drywall anything you know finishing a basement or you have a whole mall or whatever, but like the golden sauce really is in, is in custom house.

1:26My business, I actually don't own the entire roll business. I just am a self-contracted salesman for another guy who owns the drywall business. And so I just go out and find new jobs and we can get the, kind of how I do that and then get a percentage of profit on every job I bring in. Okay. So a guy with zero experience, sales experience, other than being an LDS missionary, where did you get this idea from like how did this even pop into your head because you were a middle school teacher yeah well i'll be honest so my older brothers had done this same model previously for someone else and he'd done it for a few years had great success then different reasons broke up and started his own drywall business he'd kind of planted the idea in my head forever ago and then as middle school teacher i wanted really wanted to retire my wife and also on my schedule and so like how to do something had a bunch of different ideas and then this one that seemed like the, the highest probability chance of success in a relatively short amount of time.

2:25And so, yeah. Like, were you looking at a bunch of different businesses? Were you looking at like franchising or starting your own business, buying a business? What did that process look like for you? Yeah, a ton of different ideas. And I had actually dabbled in a couple others too. It's like first business I started was a, was a lacrosse training business. I played in college and did that. And that went, you know, relatively well, like made a few bucks here and there, but hard to scale and very seasonal stuff like that and so needed something that would you know retire my wife basically was the goal so yeah dabbled in a bunch of things and kind of like for a long time just had my feet in too many like dabbling too many things and then like just had to come to this moment like i need to pick one thing go all in and just assess like what has the greatest likelihood of success and felt like this was it so like you were launching a bunch of different things launching is like probably too generous it was just like a lot of like entrepreneur like just i'm going to research this forever and then not do anything about it or like do the first step okay you know and just that like analysis paralysis like oh not this and i'm gonna try this and didn't really ever commit to any one thing that makes total sense why this then was it because you'd seen your brothers do it and be successful yeah i'd seen it being done before and felt like it was the simple like one of if not the simplest of the options i was considering also just like the recipe for for success and doing it's just very very straightforward and i could see the math like you know if i contact this many people i'll close this many and then you know generate this this income so you know being a former athlete like the steps like it was very clear to me like if i do this work i will get this outcome you have two of like my five favorite attributes which are a college athlete and lds return missionary like there's something about college athletes because there's a lot of college athletes that don't go on to play professional sports but they were disciplined and they had to of course they were competitive but when you become a college athlete it's not just about your skill it's can you train can you be consistent can you eat right can you prep for those games can you be a team player i think there's just a lot of really good attributes that you develop as a as a college athlete and then obviously as an lds missionary you just told no over and over and over and so So you've got to figure out how to talk to people, how to sell people, how to actually communicate well.

4:47So it's good that you had that skill set, but you actually weren't using those. You're like, as a middle school teacher, I mean, maybe trying to convince kids to shut up so that they could listen to the lesson or something, but you weren't really using those skill sets. No, being a middle school teacher was awesome. I really meaningful, but yeah, it felt like there was, I could use my talents in other ways too. And especially for me, the number one thing is providing for my family. And so, you know, kind of said that like retiring my wife, you know, I have two young kids and like they deserve a full time mother, I think.

5:16And so I was like, all right, I need to buckle up and make that happen for them. Okay. So tell me, you were in the research phase. You were finally landed on this. Did you quit your job and go full time or was it kind of a side hustle until you realized, oh, shoot, I can quit? Yeah, the timing was funny because I quit. So I ended the school year, year and a half ago, and then I didn't go back. So I ended in May. Then I really launched drywall in the next January. So seven months later, whatever that is. And so kind of for that seven month period, like I'm just dabbling a bunch of stuff. I had some other stuff on the side, the rest of the thing too, but like not launching that.

5:55What was it? The private school that I thought it was only K through nine. So once you hit high school, you like aged out. And so a bunch of the kids that I had worked with were in high school. and so those families like hired me to like their private shooter i guess so that was kind of another business that i was doing also i was doing lacrosse coaching and did christmas lights last year too just a bunch of funny little things yeah yeah i did how did it go like it went well like i mean you've had some guys that have crushed it in christmas lights on here and so i was not anywhere in that stratosphere i mean they crushed it after like eight years but you know year one was all is always the smallest right so yeah you don't need to compare here one i did like just shy of i think just shy of 14 000 i think in revenue or something like that i started super late i started like mid-november so and essentially like six weeks did that are you doing it this year no i'm too busy now i've been in that it's like trying to decide if i'm going to do it but i'm just so busy with drywall to be honest like i have like 10 houses going right now and so i just don't have the bandwidth so i'm selling my list actually today and i finalized the sale of my list for like $2 ,000 just to pass up all my previous clients.

7:06Jake, for you. That's awesome, man. Tell us a little bit about the drywalling business because you're not actually outgoing putting up drywall. I am doing almost no labor. The goal is to do almost no labor. Physical manual labor. Yeah, yeah, yeah. Like I obviously work, but I'm not like with a drill gun like putting up the board. Every once in a while, I have to get my hands or you can help out, but pretty rare. Yeah, so like I said, we focus mostly on mostly high-end custom homes for a couple of reasons. One is because they just pay the best. It's like solve rich people's problems kind of thing.

7:40It's also funny enough, the paradox is they're probably the easiest client to land also. Some people think that you want to go after the big production builders who are doing a whole neighborhood and you get a contract with 50 houses at once or whatever. Those are the hardest houses to get into because they just have a long list that they blast out and it's a race to the bottom. They just go with the cheapest bidder. So it's the hardest to get into, but then they're also the lowest margin by far. And so, you know, I could do one neighborhood of 20 houses would probably do the same profit. It's just one big custom home.

8:16So my whole formula is just, it's pretty straightforward. I download a list of construction permits, the software construction monitor that gives you all of, you can go as far back as you want to pay for it basically, but gives you all the current construction permits have been pulled in your geographic area. The golden sauce is if I can drive, I kind of like filter out the projects based on the builders that I know that do high-end homes, kind of the areas that go and stuff like that. And the golden sauce, I can drive to all those houses and just like see where the build is at. Because if they're past dry, well, then like it doesn't make sense when you can check them, for example.

8:53You can go to the city and just see what permits have been pulled? well going to the city it depends on you're staying your county really what it depends on here in utah you have to pay for to pull permits if you're doing it to the government and like the data this isn't fantastic so i use this software called construction monitor and you just subscribe to it it's like you're only it's like 1500 bucks a year or something like that and it's unlimited downloads of the permits and you can filter by single family homes or basements whatever so so you can see okay these people have pulled a permit let me go see where they are in the process like there's no permit to just frame and drywall it's probably a permit to what like expand or redo the kitchen or and you can filter all of that yeah so it's just like a remodel that's a different permit than a new build so like i just download only the new build permits for single family homes because that's that's the category that like custom homes will fall under you have to clean up the data a lot because you know if i were to pull the permits just in my area today there's going to be like you know 2 000 permits or something we should have any custom homes like they're all the every like the production homes every one of those houses is a different permit so you have to filter quite a bit and then i'll get down to a list of you know i don't know 200 let's say depending on the time window i'm looking at yeah drive to the build just see what where the they're at in the process and if they don't have drywall already then i just call them so i will have the builder name and number.

10:19Most of the time, it will have the builder name and number. Not every city reports it the same way, but most cities will, in Utah, at least we'll have the builder name and number. So I just cold call them. They're like, that's in the area. I saw you were building the house at, you know, one, two, three Maple Street. The driver will end up on it already. It's not, can I give you a bid? Inevitably, they always ask the same exact question. Well, let's say one of two things. If they answer the phone, they'll say one of two things. They'll say, you know what? Thanks. I already have a guy that I'm loyal to, but good luck, whatever.

10:47If that's the case, I just say, well, I totally get that. Can I just give you my name and contact in case anything changes forever? That's one of two things we'll say. The second thing we'll say, if that's not the case, we'll say, well, I don't know. Who else do you work with? What other builders do you work with? In construction, it's all just about show me, don't tell me. The best way to do that is to say you might be built for these guys. and so you know lucky enough for me the drywall company i'm selling for has done work for some of the best custom home builders here in the area and so i can just even when i was first starting out even though i hadn't done any amount of houses yet it's the same crew so i can just say no we built for you know x y and z builders and you know those are you just named rock and we've worked with reputable enough builders that it gets put in the door for easy okay hold on so let me get this straight you have one drywall company or there's multiple drywall companies you have a relationship with yes you sell for one yeah and so you have a relationship with that one and what you do is you then go to all these builders who are midstream or mid mid project and you say hey do you have a drywall company and if they say no you say here's the company that i that i work with i just say i'm with i'm with canvas drywall can we give you bid and they're good and no one has any there's no brand recognition at all with construction companies like they don't care what we're called they just wanted who we worked for so i said yeah we worked for you know mcubin custom homes which is one of the biggest ones here in utah and they're like oh well if you work for them then yeah you can for sure give us a bid like they're great dude okay that's kind of blowing my mind i mean alex formosie talks about this that's one of his strategies where he's like yeah if i was starting over today what i would do is basically go to a company and say what do you charge for this great i'll go out and sell for you but i want x percentage is that essentially what you're doing like are you just exactly it is that's exactly what i do yeah the deal i have with the travel companies that i keep 50 of the net profit on every job that i sell so yeah that's the exact setup and and you trust them enough where you're like then they're not going to monkey around with the net profit they're not going to be like well actually this job did well i can see all of that because i in our setup like i order the materials i manage the job too so i'm not just the salesman i'm like an account manager so like i like if you were the custom home builder and i were selling to you like i'm going to work with you from a to z through the build and so i'm managing all expenses too so i'm incentivized to manage the job well but to make it profitable it's more profitable is more okay so you you go out you quote you do the bid you manage the materials you make sure that the crews lined up etc you're effectively just leveraging the team that they already have to go out and perform the drywall services and their capital too because like drywall is a cash flow heavy business and so you know we have to flip the bill on long labor and material long before we get paid because we get paid on like net 30 terms or longer sometimes and so you know if i were starting out on my own like the question is why just do around drywall business it's like well if i had you know two hundred thousand dollars to start the first house then maybe i would but you know it's a high bar to entry so we have a tree trimming business it's similar to this where when we started out all we did was generate leads so we'd go to thumbtack and angie's list and google lsa we generate leads we also did some proprietary like off-market lead sourcing and then we would go out and find the crews and the crews would actually do the fulfillment.

14:23Because if we had to buy all of the equipment necessary to go out and do these tree trimming jobs, that's a lot of money. But effectively, we were kind of just a lead gen company that would then project manage. Very similar to what you're doing. You're going out, you're generating leads, you're qualifying them, you're then managing the whole process, and then you're leveraging the infrastructure. Our plan and thesis had always been, there will come a day where we bring this in-house, right? Or it just generates enough cash for us and we decide to go and do something else. Are you thinking of bringing this in-house at some point, or are you like, no, I mean, this is just a good spot for me to be in from a cashflow perspective and then allow me to find my next business.

14:59Or how are you thinking about it? Yeah. Good question. I see this as a stepping stone to the next business. I think the main reason is that I don't think a drywall, I've never seen one at least, and maybe they exist, but in our area, you know, there's not hardly another drywall business bigger than like doing bigger, more reputable houses than what we're doing. There might be some that are bigger in terms of volume or whatever. But anyways, my point is, is like, I haven't seen a business, a drywall business this year that is a real, has any enterprise value to it. Like, I just don't think it's very sellable.

15:31It's just all key man risk, right? Like the builders don't care about the name on the shirt or whatever. They just care about who they're working with. You know, let's say I were even to like take over the drywall business myself for now. there's a lot of female risk and the owner of that business leaving you know all of his accounts you know might not want me or whatever so anyways I see this is stepping stone to the next thing I think it's like I've learned a lot just about business in general and how to manage and sell better so I think something analogous might be down the path like maybe a painting business or something like that but let's go back to the beginning May of 2024 school year let's out was your plan at that point like i'm not going back to teaching yeah it was like i got to retire my wife so as you're going through that process when did you decide on all right i'm gonna do drywall and i'm gonna do it in this creative way where i don't have to get the capital to start a drywall company i'm gonna go find a reputable company like when did that idea kind of come to fruition i decided in october and then started in january so from october to january just kind of like nailing down what the deal would be with and getting all the logistics in place.

16:40And part of that was because the drywall business is going to sell for wanted to wait until like the new fiscal year for whatever their stuff. Why did you pick that company in particular? Oh, I guess I forgot to mention this. This is a little bit of a cheat code that I had was that I mentioned my brother did drywall forever and he started his own. So he's long for, I'm the youngest by a lot of years. So he's like 18 years older than me. So I sell for my brother's travel business so a little bit of a cheekbone that i have like i didn't mean to do that no you're good and so it's for him now i know a lot of people who do it not they're like this exact model not sure brother like i have a buddy who does it for roofing for a surround guy so for me it was i kind of have my foot in the door easy now for to do it just for him so i actually love that because when i'm talking to people about getting into entrepreneurship i'm always like what's your unfair advantage.

17:27That is an unfair advantage. Not everybody has a brother who owns a drywalling company that they can go and start a business with. And sometimes we kind of feel sheepish about it where you're like, well, I kind of cheated a little bit. But the truth is when you cheat like that, you're not actually cheating, but when you use that unfair advantage, it just increases the likelihood that you're going to be successful. So it's not a bad thing, dude. Like you looked around, you're trying to find your opportunity. You're not going back to the middle school, you needed to find something where, okay, where can I compete in a way that is unfair relative to other people?

18:00And obviously this, this is the space. Hey, I don't know if you remember this, but when we started this podcast, we entered into a social contract. I would spend time, energy and money producing this podcast, interviewing these individuals and giving you insights into how to build, buy, start, grow your business. And you would like subscribe and leave me five-star review. Now, out of that, we both get to talk to really cool people and hear really cool insights. We both get a ton of value. But I just want to help you keep your word. So would you do me a favor? Will you go leave a five-star review for me on Apple or Spotify?

18:33It would really help. And if you want, even share this with a friend. Is that 50 % split normal? When did you guys start talking about that split? I don't know, all the other arrangements. That was the arrangement that he had when he was doing it for another drywall business 10 years ago. And so we just kind of brought over like, well, this is how he did it there. And I think it partly depends on just what the margins are. Like my buddy does this for roofing. Margins are roofing a lot different. So I don't know that 50 % spread. He doesn't get 50 % and I don't think it probably makes sense on roofing, but you know, for drywall, we try and run like 20 % margins on every job site.

19:10There's enough to split it and be meaningful for both parties. or if you've done 1.7 million in the first 10 months and you're at 20 % margins, 340. So let's just call it$340 ,000 net margins. And you're splitting 50%. You're somewhere in the ballpark of having made 150 to$170 ,000 in the last 10 months. It's like almost exactly 170 ,000. Yes. Dude, that's amazing. That's incredible. Okay. So in October, when you're thinking about doing this and you penciled it out, is this where you thought it would be? Or like, what were you thinking it might look like? My goal for year one was 150. Wow. Okay.

19:51And that was, would be by the end of like this calendar year of 2025. So, you know, hopefully I think by the end of 2025, we'll be closer to, you know, I think I would have brought in closer to probably 185, 200. part of it is like anyways is what her time was like deal slow a little bit just slow down yeah when did you tell your wife you're doing this did she know in may was she like okay yep we're quitting what's the plan or were you like august rolls around you're like so i'm actually not going back to school yeah we decided before this we were ended we decided like march april and so we it had been kind of like a slow build to this and lucky enough she's had a job that like yeah i had my own stuff and making money but very up and down and and very grateful for my wife she's had a very stable job that you know for those first few months and frankly even the first part of 2025 has loaded us because it takes a long time for me to get paid so i haven't in full transfer i said about 170 000 that i have like an account for sewell's i've not yet like it's not hit my bank account yet because of the payment terms of of how construction flows oh that makes sense for example like i sold a house in march that we are barely halfway through on right now and then you know we'll invoice once we're done and we don't get paid for 30 days after that so it's like it takes a long time for the the checks actually start coming in which luckily luckily enough now we're rolling but you know for the first five or six months so even 2025 it's like well i've sold this much and like i know i'm gonna get as much but it's not in our bank now yet and so no lucky enough my wife's been awesome and email flow to seller i love the fact that you identified the business you knew what you're going to go and do you identified the unfair committed advantage in your brother which is rad between october though in january was still two months and i'm sure your wife was you and your wife were both like all right this is seven months without income what are we doing what did you do between october and january were you like prepping to hit the ground running in january did you already start pulling those reports and start looking at at bidding jobs or did you wait all the way until january to start looking at reports like what did january look like did you have revenue in january well that's kind of actually why the christmas lights like october to january because i basically had yeah i was like well i have a couple months to kill like they don't want me to start until january 1 i'm not gonna start another business for two months or ever so yeah and talk about unfair advantage have a buddy does christmas lights in florida and his crush shit so i just called him it's like hey how do i do this in six weeks and and make at least a little bit of a little bit of change that's right the goal the goal was the one thing like capital expenditure i needed for drywall was you need to have a truck just to to build haul material as needed and stuff and so i was like all right let's make enough in christmas lights to pay for the truck and lucky enough that's what we did.

22:46So the, that and the January one was like, January was just kind of a slog. And then first sale was like February 1st or something like that. So, okay. So January, no revenue, no revenue, no revenue in January. This is where we now get to talk about your secret sauce, how you close three times more sales. Did you already know kind of what the process was? Like, did you know how to generate the leads, what the sales cycle would look like, how to close them? Or were you learning like, was January your learning month basically? well again going back to like cheating out for my brother he took me he drove me around for like one or two days and was like okay this is how i do it and then just kind of gave me like a rough place to start and then i kind of took it from there and and used a lot of his like his methods and then added on like my own so fees and stuff that way to to boost inversions on things i've got but you were training you're eating up to speed probably i'm assuming in january you started pulling those permits and were reaching out to contractors.

23:44So you probably had leads in the pipeline that you were starting to work. Yeah. Cause it will take, you know, from contact to like the sale closes sometimes can take several weeks because they're getting other bids, they're trying to decide or, or whatever. And so it's almost always like whatever sale I make this month, I generated those leads the month prior. Was that your only lead source is going through, what was the name of that website? Construction monitor. Is that your only lead source construction monitor that or if you're in an area that's building a lot of houses and they happen to have a sign in front of the house that has the name and builder number you can do that only certain neighborhood certain neighborhoods require that more than others and so you know let's say for example i download the permits and it takes me to you know whatever heber city and i drive to that house and there's a house next door with the sign up with the builder's name i'm going to call both of them but yeah i mean essentially the only starting place with leads is just the that i'd use it's just the construction permits yeah that's interesting because you could go and drive around you could go and see who's working construction but you don't necessarily know who the builder is then it's not like they're publicly advertised most of the time they're not publicly advertising like this is johnson building company or i don't i don't even know what what's the name of your brother's company canvas drywall but you know if it's canvas drywall but they wouldn't even be like it would be the builder who's subbing out to canvas drywall yeah okay so it's like so yeah yeah johnson building cow or whatever it would be the name of the backfield builder how did you like track leads did you have a crm did you use google sheets were you just like writing on every sticky note around the house was your wife helping you like what did that product because that's kind of the engine that gets everything else going you're not doing anything else until you get some sick some leads in so just download all the permits put them in a spreadsheet and then And I just kind of built my own CRM and Google Sheets and kind of had like a column of like, okay, contacted them.

25:37They didn't answer, did or whatever. And then I tracked like different. So like about 50 % of the houses you call, the builder will not answer the phone, which is crazy. But that's also an unfair advantage. Like if I just answer my phone and people call because most construction people just don't. Anyways, so 50 % of the builders just won't answer the phone. So leave a voicemail or leave a text, whatever. And so I would even track like what text did I leave or what voicemail did I leave like the script? And I would track like, okay, these are converting better than others or whatever. Just in Google Sheets.

26:08Just in Google Sheets. Yeah. You weren't using like Go High Level. You weren't using like Outscraper. You weren't using Klaviyo or like any other texting or automation software. You were just using Google Sheets. To start just Google Sheets. Now where I'm actually trying to implement some like Go High Level automation, like lead nurture follow-up stuff automated. because honestly, that's where I probably lose the most deals is just, it's not that I don't have enough leads. It's that I just can't follow up with enough of them because it probably takes, if I don't get the person on the phone that first call, it's going to take five to 10 follow-ups before I can get them on the line.

26:42I just, it'll always happen to me. I can't follow up that many times to follow them manually at least. And so whether that's getting a DA or probably just maybe I can go hell or something. That's kind of like next stage for me that I'm working on right now. But I wouldn't think in your geography, there's that many builders. Is it like, I would think maybe 20, but there's, there's that many builders that it's just really, I mean, we go all over, like all over Northern Utah, essentially. And so, you know, it's probably like a two hour radius or something that we work in. So there's a lot of construction.

27:14I mean, I actually just did the other day, like hatch hatch, do some deep research on like what safe codes are doing the most. high-end custom home builds in the united states and this area of utah is like top three so there's a lot going on and the others actually have by you in boise so it's like boise austin and utah so when you were getting them on the phone like we talked about earlier you have a you close at a 3x higher rate what's your secret like how are you closing these sales how did you get that first sale closed yeah you don't close on the phone so the the phone pitch is just like let me give you a bid.

27:49Like, just let me send you numbers. And then from there, you can tell me not. It's funny that anyone would say no to that to me because there's no, like if you're the home builder, there's no risk to you in getting numbers from me. It's no downside. And there's all the downside for me. Cause it's going to take me, you know, four to five hours to put together a good bid for you. So I have to go to the house. And so this is actually the secret sauce is I go to the house that after you tell me, yes, you want to bid, I go to the house and physically measure it. Like I'm pulling out a tape measure and measuring every wall for drywall.

28:20Now there's softwares you could do stuff like that. They do it faster, but this is kind of the secret sauce of how I close three times more is that like I could bid a project just off of the construction plans, let's say, but when I can get in person and measure the house, you know, I'll be at the house for two to three hours. And inevitably what happens when I'm there for that long is that more often than not, I'm going to run into either the home owner or the home builder. And if I can meet either of those two people, that's when my close rate just skyrockets three decks, because like, I like to think I'm fairly likable dude and personal.

28:56And so many subcontractors and construction aren't that way, to be honest. And so if you just have any level of people skills in this industry, you can just crush it. And so like the other day, I went to measure this really small house. So like, I probably could have done it off of plans in 20 minutes, but instead I drive an hour there. I spend two hours there just measuring it. But in that time, I met both the homeowner and the home builder. And then the next day, home builder texts me. He's like, hey, we really like you. We want to go with you. So it's like, man, if I can meet you, then hook, line, sinker, deal's done pretty much.

29:31Well, okay, that's cool that you close them. But when I hear you driving one hour each way, I'm like, what a waste of time. But I have no idea how much a job like that could be like how much would that job be so that job is actually pretty small so like my cut and commission like my commission will probably be at two thousand dollars but to put this in perspective like today how my house going also the same exact process nothing different that my commission on that house will be twenty five thousand dollars oh my gosh what so yeah wait wait wait i'm just 25, 50 ,000, 20%. So you're talking about a$200 ,000 drywall job?

30:16Yeah. Our margin on this house is actually a little bit better just because there's a lot of detail. So I think our, I think their revenue on this job will end up being, and it's still actually going up because they keep adding changes and stuff. Okay. I think we'll round out probably around 170 ,000 was going to be our final. Wow. Like gross. I mean, that just seems for drywalling, like, cause you're not framing, you're just drywalling. It's a massive. i mean that's a very large house that's like abnormally huge but yeah oh my gosh are you framing out the united center like it's freaking massive like a temple basketball yeah basically they like a full basketball for work like yeah no it's a big house for sure and that's that's abnormal right like that's there's not many of those houses being built but my point is is like that house was literally the exact same process as the small two thousand dollar like not anything different and it takes a little bit more time to measure it but like there's nothing more so it's like how'd you get this like how'd you get this builder it's like the exact same process as i got joe down the street you know it's just cold call show up you don't be likable is the whole formula really month one nothing month two you close your first job has there been any like flywheel happening at this point are there like word of mouth like oh yeah now i work with this builder.

31:33And so I'm going to send Jared more business. Like, is that starting to happen yet? Or is that just not a thing in this industry? I kind of already started with the flywheel of like word of mouth, because I could piggyback off of the builders that like my brother had already been working with. Right. And so I was kind of like my cheat code of how, if I had started, like, let's imagine January when I started my own drywall business, even if I had the capital to do it, like I wouldn't have had any reputation. the flywheel for me though has been like recurring revenue because the same builder will build multiple houses and at this point like certain builders will make you compete but most of them they just like send it to your email and it's like hey here's our next one go and so you have one builder this year like i'm on house number eight with or something like that you know like the deal that you have is okay any any business that comes from that builder now that i brought on i'm getting that 50 split yeah to that so in year one you're doing you're going to do 150 170 years two three four and five just you could just have a solid base obviously as long as the company that you're partnering with to do the fulfillment is doing a good job that's as borat would say a very nice great success dude yeah so i don't have to prospect that much anymore like i don't like i still will if i'm a little slow like i'll still pull the permits but now like i'm staying honestly pretty busy just with the recurring stuff but you could theoretically hire somebody you could bring on a guy who's just like i need you to go measure and just like you no experience but you know they're going to do be good at sales so that they're there at the right time talk to the homeowner talk to the builder and then you start kind of branching out is that the roadmap for you i've experimented with it a little bit like i have this college kid that that i'd use as like an sdr to do like pull permits and go drive someone can you define what sdr is sales development ref is that i never actually worked yeah i think i actually worked at sales i think that's what it is but he's just like basically booking like he's worked acting like the sdr i'm the account manager so it's like just book me like measurements essentially and i pay him like 100 bucks per like booked measurement and then on the back end i'll give him like a piece of the commission too so it's a no-brainer for him it's like in one call if they say yes they're getting a bid, then it's a hundred bucks for him.

33:52And for me, like a hundred dollars per lead is, you know, if I'm going to make$20 ,000 one house, like a hundred bucks is, or yeah, 2000, like a hundred bucks is, is easy. So then a little bit, to be honest, we got really just like our fulfillment capacity was kind of maxed out, especially like mid to end of summer. So I kind of actually had to like pump the brakes a little bit on, on selling because we, we can keep And I always say, my biggest philosophy in all this is the best sales is just good fulfillment because that's when you get the recurring stuff. And so if we are so bummed, I say I do a good job on what I already have, I'm going to lose more sales by bringing on too much than I would not prospecting, if that makes sense.

34:34Yeah, that's a great point. Anyways, it's kind of like a, I think in any service business, you have to gauge the production with the sales and balance it, right? Yeah. Yeah. I mean, any business, especially as you're growing, there's always this tension between fulfillment and sales, fulfillment and sales. The ops team is like, well, we're at capacity. And the sales team is like, we can't say no, otherwise we're going to lose business. It's just, there's always that kind of tension. I do love the way that you're thinking about it, though. It's like, all right, I'll bring on another guy, and then I'll give them a percentage.

35:04And we're kind of growing that way. It's like you've got your downline, and you're doing the most Utah Mormon thing ever, which is like, all right, we got our MLM structure, and we're just freaking cranking, dude. Smell a Luca. I'm just kidding. Pretty much. Yeah, pretty much. What did your brother think? What did the builder think? Or the drywall company think? Are they stoked? are they like dude 1.8 million dollars in sales the year's not even done yet this is amazing or is it like uh it's cool a little like i have no idea no context yeah no i mean for them it's sweet because like if i'm bringing home let's say 180 by the end of the year like that's 180 net profit for them too that they get to take home you know it's like i think that it's a win with it has to win for bull hardies obviously and and like even though i mean is that significant for them like I guess the question is like, it is okay.

35:56It like not, yeah, I probably didn't double their business, but you know, probably just shy of doubling it or something. It's like, yeah, it's mean, it's definitely meaningful and you come for them too. Dude, that is freaking, that's so cool. That is so cool. I just love businesses like this where you effectively become a lead gen company. And so you, you play middleman, you get the leads, you generate the leads, you can go out, you bid the business. And then you find the subcontractors to launch the business. I think that's probably one of the best ways to get into home services because you don't have to buy the equipment.

36:31You don't have to get the crew and worry about all the logistics and the fulfillment side of things. You can just start running and gunning. And then later, if you're generating that much, you can make kind of make a decision like, okay, cool. I actually want to start this business. I'll bring it in house, but you don't even need to borrow that problem right now. So that's number one. I love this like lead gen fulfillment relationship in home services. Number two, if you're going to do it, find someone who already does the fulfillment well and has some relationships that you can learn with. Don't necessarily go out just cold and try to figure it out.