John Wilson shares his journey of growing a small plumbing business to $26m, with plans for $100m. Topics include family business, acquisitions, ad spend during Covid, why he buys small businesses, installing an operator, and the challenges of scaling a business. He discusses the taxonomy of blue collar businesses and shares references for further learning.
Strategic acquisitions led to 26x revenue growth in 7 years.
Expansion into new markets provided access to larger customer base.
Rapid growth through multiple acquisitions quadrupled revenue in months.
Merger of acquired businesses streamlined operations and accelerated growth.
Success attributed to bold decisions, strategy, and relentless determination.
Deep dives
Strategic Growth through Acquisitions
John Wilson strategically grows his family's small plumbing business through a series of bold acquisitions. Starting from acquiring the business in a position of weakness, he sets out to turn it into the largest licensed home services company in Northeast Ohio. Each acquisition is meticulously planned, leading to a significant increase in revenue and team size within a short period of time.
Expansion into New Markets
Recognizing the limitations of the existing market, John Wilson expands his business into Cleveland, a larger market with more growth potential. Despite initial challenges and mishaps in launching the new location, the move provides access to a much larger customer base, setting the stage for significant revenue growth.
Phase of Rapid Growth and Integration
In 2021, John Wilson embarks on a phase of rapid growth through multiple strategic acquisitions. The acquisitions lead to a swift expansion in revenue and team size, quadrupling revenue and tripling headcount within a few short months. The integration process poses challenges, breaking existing processes and requiring a shift towards a more robust leadership structure.
Merging Operations for Efficiency and Growth
Following a period of digestion and operational restructuring, John Wilson consolidates all acquired businesses into a single, unified operation. This merger paves the way for streamlined operations, increased efficiency, and accelerated growth, marking a pivotal step towards maximizing synergies and further expanding the business.
Reflection on Success and Unconventional Growth
As John Wilson reflects on the unconventional path and remarkable success of his business, he acknowledges the blend of strategy, luck, and relentless determination that contributed to achieving his ambitious goals. Despite facing challenges, making mistakes, and feeling astonished by the journey, the business's growth and achievements stand as a testament to the power of bold decisions and calculated risks.
Tiered Structure in Home Services Business
The podcast discusses the tiered structure in home services businesses, ranging from high TAM businesses like HVAC and plumbing to low TAM businesses like pool service and garage door companies, highlighting the differences in labor pool, market size, and licensing requirements across these tiers.
Service vs. Install Business Model
The episode delves into the distinction between service-only and install-only business models, emphasizing the advantages of incorporating both services and installations for sustainable growth and a consistent revenue pipeline, contrasting with the challenges faced by businesses solely focusing on service or install aspects.
The Value Ladder Concept
The concept of a value ladder is explained, where businesses start with low-cost services and gradually upsell customers to higher-ticket items, creating a sustainable and scalable revenue stream, as opposed to businesses with one-off high-ticket services without recurrent customer engagement like window washing or foundation repair.
Challenges in Scaling Business
The challenges of scaling a business in the home services industry, including the need for thick skin, daily obstacles like theft, and unexpected hurdles such as mass layoffs, firing executives, project shutdowns, and dealing with recurring setbacks and risks associated with business ownership.
