Jeremy Weisz 20:56
What’s the, when they are hired to when they’re out in the field by themselves. Like, how long is the training process and kind of, what does the timeline look like typically?
Tommy Mello 21:07
Yeah, so you’re training for two months, and then you’re getting a lot more training. We call it polishing, for another month, and then there’s still meetings every day that you’re training. We got a mojo call. We’ve got a one-hour meeting Thursdays, and we’re getting a mojo Call. Talk about that. Yeah. So 15 minutes, we talk about the big wins from yesterday. Any updates? So hey guys, welcome back to the Mojo call. Let’s talk about some big wins. We go over the numbers from the day. We go over the great reviews, we talk about the big wins, and I’m prepped to call on one person in that market to say something, something happened. You had a mental breakthrough. It’s always positive news. It’s never we got to do better. You guys suck. You’re not cutting.
They were not setting the record. Whatever it is. It’s never pessimistic. So we’re going to talk about what’s the big win and what happened? How did you do that? How did you sell a service agreement at every job? How did you get not only one five-star review, but you got three from every client? Because success leaves clues, and we like to share those. So we got this environment of sharing, and when they hear it from their brothers and sisters, it’s real. They can hear it from me and the other leaders all day. And sometimes I say, how was your paycheck this week? Because I saw you set a record. What is that going to do for you and your family?
Jeremy Weisz 21:08
So Mojo call, keep going. You said there’s other other calls.
Tommy Mello 22:37
Thursdays, we train for an hour where everybody comes in across the country. We do ride-alongs. We’ve got a market acceleration technician training team that flies to markets. We’ve got virtual product specialists. We’ve got 16 of them that handle calls when you’re going to sell a door, the client’s interested in a new door rather than fixing their old beat-up door. We got one of those calls on Wednesdays. I interview two technicians a week that are killing it. That goes out to every market. It’s a 20-minute call at the end of their one-hour training. Luke does a podcast internally with two top guys, and that comes out each week. And then we’re actually adding if you’re not hitting a threshold, and by the way, the threshold is built on your dreams, not our goals. So if you’re not hitting your expectations of yourself and dreaming bigger, we’re not going to reprimand you.
We’re just going to remind you of why you’re doing this, the things that you picked. And we peel back that onion and we’re going to force it, and you’re going to be forced to train more. And people might say, well, they don’t want to train Well, listen, they’re accountable to their own goals and their own dreams. Or maybe we didn’t unpack that enough to figure out what’s going to make them go more. But maybe they got to pick up an extra shift, a night shift. Maybe they got to, whatever it is. If they got to take dad camping and he’s on his last leg and they wanna have one last fishing trip, we’re gonna bring that up and we’re gonna show him or her how to get there. And there’s a lot more going on. But the idea is, training is not something you do, it’s something that’s always done. It’s not like, hey, we’re going to train this week. It’s like, it’s a culture of always improving. In fact, I don’t know if you can read that, but I’m wearing the bracelet, one of our core values always improving.
Jeremy Weisz 24:35
Before we hit record, we were talking about health. And it reminds me of that. It’s like, you’re in shape. You can’t just like, okay, I’m in shape now. I’m going to stop working out, stop eating, right? It’s a continual process to stay in shape.
Tommy Mello 24:50
Yeah? Do realtors stop learning about real estate? Do doctors stop learning about new medicine? I mean, every other profession, well, I used to do two a days and football, right? We practice 10 times a week to play one game, but in home service or some businesses, we say, Hey, you made it through training. You’re done forever. And we expect people to be great, I mean, and a lot of it is just understanding EQ, right? Like, think through their eyes. Talk to them like they’re your mom. Watch your mannerisms. Say thank you. Make sure your breath smells good when you pull. We don’t teach sales. We teach how to be a better human.
Jeremy Weisz 25:34
Talk about a key hire, obviously, starting from scratch, growing this company, what is maybe a key hire throughout your journey that you remember was pivotal for you.
Tommy Mello 25:47
The first one was my mom, 2010, I got her to move. One of the reasons was I realized really quickly I couldn’t trust people, and that was partly because I couldn’t pay a lot and I didn’t know how to hire. I didn’t understand how to interview, so I needed somebody I could trust, and my mom and stepdad filled in the blank. They did the stuff I didn’t want to do, and my mom was so nice and empathetic on the phones. A few years later, we hired a guy named Adam Cronenberg. He was like a general manager at the time. I didn’t even know what I was going to pay him. I give him a check, whatever I could. I just told him, what’s your number at the end of this?
And he said, If you could give me 5 million, I’ll come murder it for you, and I’ll step in where you don’t want to. And he did everything he said he was going to do. And I did everything. I gave him three he earned. I didn’t give him anything. He ended up getting three times that, but he was an integrator. I didn’t know it at the time till I’m Red Rocket Fueled by Mark Winters and Gino Wickman, but I didn’t realize ROY WILLIAMS ran Walt Disney’s dream, and a lot of people think they’re both. But the visionary needs to maintain the vision. The integrator figures out how to get to that vision, and they work together. And there’s not a lot of visionaries. A lot of people want stuff, but they don’t even have an idea on how to get there, what it looks like and what the company should be, and what the core values of mission, vision and how it’s going to grow. And I’m a marketing guy.
I’m a culture guy. I love sales, but I don’t like a lot of operations. I’m not a good finance guy. I’ve had to learn those things and be a little bit rounded about it, but I don’t ever go to work. I’m here at work right now. But if this is work, I love what I do, that’s why it’s like, Man, when are you going to be done? I don’t think I’ll ever be done, because I built the dream life.
Jeremy Weisz 27:48
So for you, I mean your mom. But also a big one was an integrator that could basically do everything, be operations and help, execute the vision.
Tommy Mello 28:01
100% Yep.
Jeremy Weisz 28:03
I know a big part of your journey is mentors. Yeah, and you talk a lot about the mentors in your book, and, you know, again, full disclosure, I was listening two and a half times speed, but I think you said Al Levi was one of the big mentors, I’m not sure if I’m pronouncing it right.
Tommy Mello 28:24
Al Levi, I think it was episode two or three of my podcasts that I started in 2017 and he lived in Scottsdale. So he said, well, I don’t mean you do lunch. I want to learn more about your business. I’ve seen you around town. So we went to lunch, and he wrote the book The Seven Power Contractor, like I said, and he said, can I go back to your shop and learn more about your business? I said, I love that. The one thing he was really surprised is how well I listened and how I took notes. And he said, hey, and he criticized my business pretty hard. He really made me feel bad, but he offered a solution, and I don’t think he was just trying to sell me, because I now know Al Levi very, very well.
He’s like a second dad. And he said, If I work with you, your business is going to become way too easy, and you’re going to probably grow very, very fast, because right now, you’re the biggest firefighter I’ve ever, you’re so good at you handle all the bad reviews, you handle the payroll discrepancy like you’re so good. He goes, but you need manual, standard operating procedures, systems and checklists. You need a really good org chart. You need a depth chart when you need to understand the steps of delegation and the triangle of communication.
And so we hired him, and it wasn’t cheap, and he said, Tommy, you’re so good at generating revenue, we’re going to help you figure out how to build profit. And he hired a couple people underneath him to teach me other stuff that he was not the best at, but he knew who to bring in. And he used to always tell me, like he told me this twice, I might have to fire you as a client because you’re too busy listen to every book and every idea. If it’s not EOS, it’s this, it’s this, it’s this. Like, just listen to what I tell you and stop learning until you get these fundamentals down. Because you’re looking for the answers in every direction. And I’ve got the answers, I’ve tried, and I’m true, and I’m trying to help you. So I had to kind of stop with the ideas. I still made a list. He taught me how to make my top 100, top 30, top five, and you cannot kill my dreams. You can’t just say you’re not going to be able to do anything or think anymore. But he said, we’ve got a list for this.
And it was a Trello board back then. And he used to tell me, just stop and listen, and we’re going to get this done, right? We’re going to get to the finish line on this manual, then we’re going to do this manual. They’re going to read them out loud, and you’re going to make sure you’ve got a data integrity team to make sure the reporting is correct. And he was right. I met him at 17 million. I bounced to 40 in no time. And then he said, I think you need to rebrand because your raps suck and there’s nothing kind of your yard signs don’t look like your Val pack coupons don’t look like your signature on your email. And so he said, Go to Dan Antonelli with kick charge. And Dan gave me a price, and it was more than I wanted to spend. But I trusted Al Levi. I did it. Man, we shot up to 80 million, and people wanted to work here. When the brand was right, I didn’t understand how important this brand was. And I’m like, I still go to L for L, and he centers me.
I took Al’s stuff and took it to more technology. We got out of Dropbox and off of Word docs, but Al is, he’s 71 and he’s, the best mentor I’ve ever had, and I recommend Seven Power Contractor. He’s got the program I paid him several 100 grand for like, I don’t know, eight or 10,000 or something, but changed my life and a lot of people will never have a chance to work one-on-one with him. He still does phone calls, like 30-minute sessions. But if you could implement the things that he considers to be vanilla and they’re not fun, and building systems and building scorecards and making sure that the people are winning, it’ll rocket their business into a new orbit.
Jeremy Weisz 32:21
Talk about the scorecards for a second.
Tommy Mello 32:25
Yeah. So a scorecard like when I was a kid, we had a report card that told when I was absent, when I was late or tardy. It told what I was doing in each aspect, Social Studies and English and math. So we decided, just like Jack Welch, people should know where they stand. They should know who’s winning. They should know who to ask if they want to get better at who’s getting the most reviews, the most five star reviews, who’s getting the best conversion rate, who’s getting the best, highest average ticket, and how are they doing it, and there’s a lot more to it, but these are really, really, really accurate numbers. That’s the problem with most scorecards, is the data is not right, and the minute you’re wrong on the data, as somebody figures it out, they don’t trust you, and they think you’re lying and cheating from them.
So it’s not easy, but you could just take, like, what’s in it for them? How can they win? So if you’re paying somebody $15 an hour, and they’re booking 65% of the calls, and you take the historical data and you say, what happens if they get to 85% what does that mean to the company? It’s just a little bit of math. You do it on an Excel. You could do it on a calculator, on a phone calculator, and you could almost play with the numbers to say, I could actually pay them $9 a phone call. And they can make an extra, go from 15 to 22 but the company makes an extra $2,000 so we’d be happy to pay them 22 and they can make it to $29 an hour, and now you got a player’s retention. You’re changing their lives. I’m not saying $29 is changing people’s lives, but I don’t like to put a limit on it. I like to say, listen, if you recruit somebody, you can get $1,500 unlimited. Hey, if you sell a service screaming or the phone, you can make money on that. Hey, if you really want to grow into this position, just tell us, we have another position that you move up.
There’s starter roles. I don’t think somebody, somebody that’s listening might say, Oh, how somebody’s supposed to live at $22 an hour? Well, how’s somebody supposed to live making minimum wage at a shopping center bagging groceries, they move up in a different positions. But I like people to be able to make a lot of money, and I love paying a lot, because when they’re getting paid, I know we’re winning too, and we can celebrate not have animosity that this person’s making too much money. I love performance Bay.
Jeremy Weisz 35:01
You’ve professionalized over the years, and really al helped you do that. And you talk a lot in the book about service Titan, what are some of the software and tools you use as a business that helped your growth?
Tommy Mello 35:15
Oh, man, so Chirp is this automation tool that Ryan Fenn presented at one of my conferences, and I went to my CTO Jim Leslie, and I said, could this work for us? So we talked to their developers, and they needed to develop, they needed to afford, develop the product for the company size we were, and the API polls we needed. And man, I white border for days, and I figured out ways to build automations for if you didn’t sell a customer, if you didn’t book a phone call, if you had a cancelation, or you had a service agreement or you needed to get the extended warranty processed. And man, we started adding several hundreds of thousands of dollars of profit a month because of this technology. Service Titans, amazing, intact, amazing.
You look at real voice is an AI tool that allows us to hear the conversations. When you’re at a house, you only need one person consent, so it’s easy to make sure they’re following the script, and then make sure they treated our customers with respect. You’ve got rapid hire is who Jody Utter Hill, I use them to recruit for me. I’ve got 50 new guys that started about 13 days ago, just this month and next month, our class is over 40, and they have these job fairs that we invite everybody too. We feed them, and they market on social media for us, and they’re a big piece of how we hire. I’ve had so we use Power BI to actually statistical analysis to tell us the data and to tell us the right moves and marketing. And we can pull in significant data.
We use this thing called Dispatch Pro, Owner, Service Titan, that takes statistical evidence based on, it’s not AI, but it’s machine learning to tell us who’s the best person to go to this job based on previous experience. And we’re a technology company that does garage doors. I mean, if I was to be real, I’d have had a lot on technology for the way I make decisions now.
Jeremy Weisz 37:30
I’m curious, you eventually went the private equity route, right? Talk about that process and what made you decide to go that route.
Tommy Mello 37:46
So I pretty much know all the big hitters that got on the service side. It’s the who’s who, it’s the biggest empire. There’s not a massive company in-home service, especially in a check, plumbing, electrical, garage now, roofing, gutters, paint that are not on service Titan. So I got introduced to all these guys, and I spent a lot of time with them, and I started learning about private equity, and I had a board, a board of advisors. Each month we meet up, and Tom Howard, one of my buddies, said, never sell this company like it’s a cash cow, and all of a sudden that darn virus happened, COVID, and it just skyrocketed the business. I mean, we were hiring training, we had more leads than we knew what to do with and the multiples.
So it’s like, you take your profit and there’s multiples went higher and higher because movie theaters were closing down, hotels, supermarkets, nail salons, we were, like, deemed essential, and the writing was on the wall, and Tom flew out and said, dude, he goes, how many opportunities do you have right now to buy companies? I said, endless. He goes, how? How could you buy them? I said, Well, we got 12 million in the bank. I got a delayed draw term on for 25 million, but it’s a seasoning period of three months. And we started doing math on the whiteboard. We watched The Big Short I was at the apartments, and like the deal was, is I had given 25 people a form of equity called an equity incentive program. And if I never sold, they would never get the big event, and we did. We decided to do a formal process. We had the team in place to do it.
We had kind of all of our T’s crossed and I’s dotted, and the business got valued, right at under 600 million. And a deal got struck, and I still retained just under half of the business. And we decided we were much stronger. With the company we’re with, because they had Ken Good Earth with ghetto called me and said, dude, you’re about to get an education like you’ve never seen. You’re going to understand financial engineering and how to use debt and exactly what needs to happen to raise capital, and what these guys understand at Wall Street and combined with your knowledge of the home service space. When you learn that side of it, how money works and trades hands, he goes, you’re going to be freaking deadly. And I’ve been a sponge man.
I’ve been learning so much. The team we’re with is called Cortech, and these guys are so freaking smart and they’re so available for me, I don’t think they’ve ever dealt with somebody that like calls them more than they call us. That I’m overly communicating. And I said, give me your biggest, best company you’ve ever worked with. I’m going to make them look like a tiny little ant. And I set big goals, and they go, dude, that’s not possible. And I go, we’ll see.
And they invited me to speak, the only founder they invited to speak in New York in front of all their investors, and I say, I have zero regrets, zero regrets, because we’re going to have another deal the next two years, 100 other millionaires are going to come out of it. And I’ve learned how this works, and it doesn’t seem legal, because there’s so much money to be made, but also, how many lives are we changing? How many homeowners come out of this? How many people have set up 401Ks when people now have insurance and they’re driving new trucks and they’re showing up to church and showing up to dinner with their families? There’s all kinds of great things that came out of this that there was unintended things that ended up being great that I didn’t even think about.
Jeremy Weisz 41:42
Goals wise. One of your focuses on purchasing other companies right now?
Tommy Mello 41:49
Yeah. So there’s a few ways to grow. You can grow organically, expand your market. You could go green, fill which open up new market from scratch. You could buy it’s called mergers and acquisitions, typically acquisitions under the platform company, or you could add services, which is another way of growing organically. And we’re doing all those things, it’s hard to be good at all of them. The easy way is just to buy companies, but that way is a lot harder than people think, because you’re taking a different culture and you’re trying to blend them. And we’ve learned a lot of lessons. Man, it’s been a fun experience to learn.
We make mistakes all the time, but we remember, and then we build some type of checklist or SOP around it, and it gets easier and easier, and you start to really identify not everybody is a good acquisition. Like, there’s a lot of people that are not disciplined. They used to be, if you bought five companies in one trade, made them report through a CRM in the same financial it could be QuickBooks or intact, that you could sell that as one. Now, these companies, these private equity or investment committees, they’re getting really, really smart, and they’re doing better diligence, and they’re realizing that it’s got to be one culture. It’s got to be tied together, and typically, you want that platform to stay founder-based. But they’ll also buy companies, but they won’t get the multiple.
Jeremy Weisz 43:17
I’m curious, Tommy, when you’re looking to buy these companies, is it specific? Because you mentioned obviously other services as well. Is it specific? Okay, we’re looking to acquire other garage door companies or maybe other companies that are serve, like Pest Control, obviously, with Austin Clark is awesome, mutual friend and other types of businesses, are you focused on the same niche or adding services?
Tommy Mello 43:47
My particular case, we’ve taken the number one spot in garage doors. We know how to do retrofit residential garage doors. So that’s where we’ve mastered, not with this investment with the partners I have now, I could guarantee you, in the future, we’re going to say, what else can we serve the clients we serve in another industry, and get a master of that and blend us. But right now, there’s so much space to expand. We share a lot, too, with other garage door companies. Because we need to make the industry come up. We need to change the mind of, the old way of thinking is just, you’re taking advantage, you’re charging too much, or you’re just, you hire salespeople. But the way I look at it is, you watch these guys that make $40,000 a year.
They work 12-hour days, five days a week. They drive an old, beat-up trucks. The garage door breaks every one year. They’re not offering anything above and beyond, like my queue for their garage door, a video keypad or a bottom rubber to keep the bugs out. They don’t even mention it, even though it’s shot. They go in there and fix it’s like saying, hey, you got a ball tire that just went flat. I’m going to fix that one tire. And every time your next tire comes back, I’ll just fix them one at a time. Oh, and I won’t even look at your brakes. It just doesn’t make any sense. So the old baby boomer mentality of we’re just going to get by. We’re not going to give options. We’re going to give ultimatums. You either say yes or no, we’re not going to create a relationship, we’re not going to make sure you got a great experience. We’re not going to go above and beyond.
That’s not who we are. I’m not saying we’re the only way of doing things, but if you’re not giving options, you’re giving ultimatums. And it’s not right for me to pick the solution for the client. It’s okay to let them pick what’s going to be right for them and their family.
Jeremy Weisz 45:46
Throughout the years, Tommy, you’ve rolled up your sleeves a lot, and specifically with Mad customers. And I love some of your stories around what you’ve done in the extreme cases, with some mad customers. What are some of your favorite stories of what you’ve done?
Tommy Mello 46:10
Well, I built a team that handles this, but they always give the calls throughout the years. They give me the hardest one. They see this person needs to talk to the owner. And there’s so many stories. I mean, I brought a lady flowers, and I fixed it myself, and I apologize profusely and I didn’t plan on it, but I made it into the newspaper because she couldn’t believe that I would do that. And we brought people cider and donuts, just because we knew that their kids loved it. And to make up. I’ve written checks back for the whole service because I was embarrassed at the manufacturer. We made a mistake. But I love it when an impossible customer calls up and all I do is say I’ve heard that we really dropped the ball. Can you tell me everything so I could take notes and make sure this never happens again. I’m embarrassed.
When I started this company was me running every call I got my mom and stepdad to move here from Michigan, and I can’t believe we let this happen, and I will make sure this never happens again. Tell me everything. And sometimes these calls are 40 minutes and I don’t get a word in, but they just want to feel heard. They want to know that someone’s taking notes and actually going to create a system. Shit happens. We know that, and I can’t help it if a guy broke down, I got a flat tire, I can’t help it if the manufacturer didn’t get the parts in in time. I can’t help it if a CSR got the wrong address. And there’s a million things that could go wrong, our guy smells really bad because he’s in 140 degrees for eight hours and he was soaking at the last job. I mean, that’s embarrassing, but people want to feel heard, and I think I do a pretty good job of that.
Jeremy Weisz 47:55
That’s golden. Tommy I appreciate you sharing that. I have one last question, before I ask it, I want to point people to check out homeserviceexpert.com, Tommy, they have a great podcast. There great guests. Also freedomevent.com, for the next upcoming event, and then obviously a1garage.com, maybe they’re in your area. It’s funny, because I was at my in-laws in Scottsdale, and both a1garage is their vendor, and also Austin Clark’s pest control is their vendor. So yeah, last question is shop tours? All right, I’d love to hear about how the shop tours work and why you even decided to do shop tours.
Tommy Mello 48:47
So I learned a hack, and it’s the number one hack in the planet. Get yourself out of your comfort zone and go visit a company you want to become. That success leaves clues, and when you hear about the culture and people love to work at this company, they’re extra profitable in their culture. Their clients are raving fans with the air is different, like, the hustle is different inside of that building, like, the systems are amazing. So everybody opened their door to me, it’s like they said, you’re a garage door guy, you’re a kid. Come on in. And they couldn’t believe it. I’d show up with pizza. I’d show up. I’d have their books for them to sign. I’d have it all highlighted. I literally take notes, and I was very respectful. But here’s what they appreciated the most, is I listened and I implemented and so my thought was, people ask, hey, could I come do this? Can I see this?
And if I could give people, it’s not necessarily about seeing our success, but it’s about hearing our failures, because if I could help somebody avoid what I went through, then they’re winning. And because so many people open their doors and mentored me, and people are afraid to ask, so I’d say is, get out of your comfort zone. It doesn’t need to be if you’re in Phoenix, come but if you’re out of Phoenix, get out of your comfort zone. Get away from the noise and come in with some good questions, and I’ll answer everything, and you’ll meet my team. And it’s my way of giving back. It’s a way, because we keep the place clean, it’s waiting for me to brag on my team. It’s a way for me that if you call me a year later, which just happens a lot, and says, I’m a better father, I’m a better leader, I’m a better husband, and you had a part of changing my life, there’s nothing that comes close to that I don’t care about. All the money in the world or whatever’s going on with someone says that everything changed. Like, the way I feel is just, it’s like, amazing.
Jeremy Weisz 50:47
Tommy, I want to be the first one to thank you. Everyone check out homeserviceexpert.com and the other websites and podcasts. Tommy, thanks so much.
Tommy Mello 50:57
Thanks Jeremy, great job.
