In this episode of the M&A Launchpad Podcast, hosts Casey Minshew and Feras Moussa interview Alan Lockridge about his journey from tech consulting to purchasing and running ‘The Stoneman,’ a business specializing in hardscapes. The discussion covers Alan’s three-year search for the right business, which was affected by COVID-19, and his eventual acquisition strategy. He shares insights on the similarities between his tech-focused background and his new blue-collar business, the importance of structured deals, and the benefits of leveraging relationships in acquisitions. Alan explains how he successfully transitioned into this new industry, made incremental improvements, and maintained a steady business. Listeners are also given a glimpse into his future plans and key takeaways from his entrepreneurial journey.
In this podcast episode, we discuss:
- COVID Effect on ETA
- Acquisition & Operation Tips
- Learning a New Industry
Time stamp:
00:00 Introduction
2:10 Alan’s Background
05:24 Search for the Right Business
10:43 Acquiring & Financing The Stone Man
17:41 First 100 Days Post-Acquisition
23:11 Challenges and Future Plans
25:51 Future Plans and Tools
30:21 Rocket Round: Personal Insights
34:37 Conclusion and Contact Information
You can connect with Alan by email: alan@stonemanrocks.com
Additional Resources:
- Access our archive of video interviews on YouTube
- Checkout our upcoming Conference – https://malaunchpad.com/
- Get in touch with show hosts Casey Minshew and Feras Moussa at – info@equitylaunchpad.com
- Looking to invest in M&A opportunities or partner with an advisor to acquire, scale or sell your business? Visit Equity Launchpad
Transcript
00:00 all right on today’s episode we
00:01 interviewed Alan Lockridge where we
00:03 talked about moving from kind of working
00:05 in that Tech Consulting space and really
00:07 buying your own business and he did end
00:09 up buying a business called the Stoneman
00:11 which is focused on hardscapes and you
00:13 know kind of a more of a bluecollar
00:14 business and again you know he bought
00:16 the business right he structured it
00:18 right and he’s not having to do a lot
00:21 right and really being able to kind of
00:22 step in kind of calmly right and make
00:24 small incremental improvements continue
00:26 to grow the business and you know what
00:28 that has led to kind of in his life and
00:29 his business so Casey what was some of
01:31 your big takeaways yeah you know I mean
01:32 if you listen to podcast regularly
01:34 you’ve heard us talk about you know hey
01:35 don’t spend three four years searching
01:38 find a business buy a business well in
01:39 this case you know Allen took roughly
01:42 three years co co affected some of that
01:44 search but he really honed in on finding
01:47 the business that fits exactly what he
01:49 was really and it’s paid off right he
01:52 hasn’t had to come in and do a ton of
01:53 changes and do things and and he gets
01:54 really into that stuff but I mean that’s
01:56 ultimately what you’re trying to do
01:58 right I mean you talk about it if you
01:59 buy a company 3x multiple really that’s
01:02 like a 33% cap yeah I mean it’s it you
01:05 don’t have to do much this is not to buy
01:07 and change the world uh it’s to buy a
01:09 business get the cash flow coming in and
01:11 and maybe buy that second business or
01:13 third business let that debt burn down
01:14 right you don’t have this urgency to
01:15 grow Revenue you know 30 40% and so now
01:18 you know Allen’s sitting fairly
01:20 comfortably and can start to really kind
01:22 of Empire plan right figure out okay
01:23 what is that next acquisition you what
01:25 does that look like he’s not stressing
01:27 the day today and so so sometimes taking
01:29 that long road and focusing is just just
02:30 the fact of it is that we talk about is
02:32 is you got to make a commitment you got
02:33 to engage and when you find that deal
02:35 you got to be ready to move so he had
02:37 everything lined up and ready to move so
02:38 anyways I think it was an amazing
02:40 amazing podcast I thought it was really
02:42 good for what we covered all right let’s
02:43 get into
02:46 it welcome to the m&a Launchpad podcast
02:49 with your host Casey and Ferris with
02:51 Equity Launchpad on this podcast you
02:53 will gain insights on acquiring
02:54 investing in and selling profitable
02:55 businesses in the lower to Middle Market
02:57 whether you’re a business owner investor
02:59 or spying entrepreneur at Equity
02:00 Launchpad we will provide you with the
02:02 knowledge guidance and capital to
02:03 navigate the world of emergers and
02:06 Acquisitions hey everybody it’s fison
02:08 would love to see you at our upcoming
02:10 m&a Launchpad conference in Chicago
02:12 October 26 at a conference we talk about
02:14 what it looks like to value a business
02:16 how to buy a business how do you manage
02:18 a team right and ultimately we’re big
02:20 Believers in the buy then build concept
02:21 so we’re going to have one of our
02:22 friends Walker D the author of BU and
02:25 build there as well as one of our
02:26 Keynotes and many more so we love to see
02:27 you there to kind of get exposure to the
02:29 space and Network all right on today’s
03:31 episode we have Allan Allan welcome to
03:33 the show thanks guys appreciate you
03:35 being here great to have you have you so
03:37 Allan is with the stonean I love the
03:39 name but before we go into the name of
03:40 the business let’s talk a little bit
03:42 about you Allan and kind of what you did
03:43 prior sure uh prior to uh buying the
03:47 stonan about four years ago I had a
03:49 career in mostly consulting services but
03:52 generally always with small companies uh
03:55 along the way the companies I was with
03:57 ended up I had one that went IPO uh 20
03:00 some years ago and several of them have
03:02 been acquired by larger businesses the
03:04 the most recent one was acquired in 2015
03:07 that I was with uh I had a small Equity
03:10 stake i’ been there for about 10 years
03:11 and helped grow that business uh and
03:14 then once once the new uh firm took over
03:17 it’s kind of an international uh brand
03:20 uh just wasn’t good fit for me so I
03:21 decided it was time to to move on and
03:24 through uh through a couple
03:25 relationships got into business
03:27 acquisition opportunities and and kind
03:28 of came this route all right so really
04:30 quick so I mean I think you did
04:32 technology Consulting right because a
04:33 lot of listeners may be that similar but
04:35 what kind of you know what exactly were
04:36 you doing were you doing project
04:37 management were you doing development I
04:38 mean what that’s kind of a very broad
04:40 space but just so people can relate yeah
04:42 I mean over 20 years I did quite a bit
04:44 uh I did some technology back in the
04:46 early part of my career but really moved
04:48 into uh strategy development and then
04:51 worked with different cios and chief
04:54 scientists and and certain organizations
04:56 um and then also got into quite frankly
04:58 a lot of m&a work in financial services
04:60 got you were introduced to m&a through
04:02 your your your career yeah yeah so what
04:05 takes somebody that’s in technology and
04:07 then going hey I want to go to a boring
04:09 blue collar business so what what what’s
04:11 that
04:12 shift well I think yeah I have a
04:14 engineering background and so kind of
04:16 getting out of big corporate was really
04:17 the shift uh I think construction was
04:19 just the the right piece of it um
04:22 fundamentally though I I do think the
04:24 business models are quite similar in the
04:26 sense that uh in my prior career from a
04:28 from a sales perspective you know I
05:31 sold uh you know you know Human Services
05:35 right you know skilled capital and uh
05:38 you know before it might be doing
05:39 development or doing strategy or doing
05:40 project management and and now it’s
05:42 stone masonry and carpentry but
05:44 ultimately it’s it’s really you know
05:46 selling skilled labor and their talents
05:47 just a just a different type of skill
05:50 yeah so but really quick though so I
05:51 mean you know most people right 20 years
05:54 Corporate America you’ve had multiple
05:55 exits Etc they stay that right what
05:58 ultimately how what made you realize hey
05:01 maybe buying your own small business is
05:03 the path you wanted to do and you know
05:04 did you get exposure to it through a
05:05 friend did you happen to go into event a
05:07 lot of people kind of stumble into it at
05:09 first because they don’t realize that’s
05:10 an option right and so was there
05:12 something specific that you ran into
05:13 that helped kind of give you that
05:15 visibility yeah I I was never a Founder
05:17 on any of those prate companies you know
05:18 had got in some at early stage and and a
05:20 couple of them but never a Founder so
05:21 that was that was sort of the uh the
05:23 part of it wanting to wanting to kind of
05:25 Take the Lead there uh really found it
05:28 one morning I was I was out on a run
05:30 with a buddy who’s a a local banker and
06:33 we were chitchatting and he just said
06:35 why don’t you buy a company and at the
06:37 time I thought he was kind of crazy and
06:39 then I spent a few years kind of looking
06:40 into it and it was right fit for me got
06:43 it so then looking into it I mean what
06:45 so what did you start doing right to
06:46 start to kind of open up a pipeline get
06:48 educated in the space and ultimately
06:50 find what you found yeah I think you
06:52 know I did the the standard uh you know
06:55 buy and build and hbr guides and so
06:57 forth and kind of really understanding
06:58 the model uh met with a lot of the
06:00 brokers in the area looked at a lot of
06:02 businesses I did you know some Outreach
06:05 I did a lot of broker Outreach uh took
06:08 deals that I found online either through
06:09 Brokers or Biz by sell kind of reviewing
06:11 those you know kind of probably some
06:13 standard activities there uh for a while
06:16 I did hire a buy side broker uh that was
06:19 looking for some opportunities for us uh
06:21 for me uh and that worked pretty well
06:23 none of them really those deals panned
06:24 out but it wasn’t for you know lack of
06:26 finding other those opportunities just
06:28 as as Lois do they they sometimes don’t
06:30 don’t pan out exactly kind of kind of
07:33 took a slow turn during covid obviously
07:35 lots of things kind of shut down you a
07:37 deal that I was probably going to close
07:39 on had an Loi in January of that year Co
07:41 in in 2020 and then oh by by March it
07:44 was it was dead but I’m I’m happy it it
07:46 died you know before and then then after
07:49 and how long was the search how long was
07:50 your search what was the bu box uh so
07:55 the the search lasted you know going
07:56 through the co period about three years
07:59 so a little bit longer than I would have
07:00 anticipated I think like I said Co put a
07:03 stop to the to some of that uh buy box
07:06 you know i’ I’ve got two teenage
07:08 daughters so uh they were doing really
07:10 well in school I was really focused on
07:11 the Charlotte Market I wasn’t looking to
07:13 move uh so I was looking for something
07:15 in in Charlotte I was looking for
07:17 something that I could take down on my
07:19 own without investors certainly using an
07:21 SBA loan so um you know depending on the
07:24 deal I could have gone you know you know
07:26 up to four plus million uh on the
07:28 acquisition if it if it made sense and
08:31 you know I kind of knew what I didn’t
08:32 want I kept I kept the Spectrum pretty
08:34 wide on the things I would look at
08:36 knowing that I was focused really tight
08:38 on the Charlotte market and and what I
08:40 could really really do I I didn’t want
08:42 to get into restaurant retail and didn’t
08:44 want to get into you know on e-commerce
08:47 things like that that I felt like would
08:49 have a you know more of a global
08:50 competition oh that’s fair I mean yeah I
08:52 think early on WE ruled out restaurants
08:55 retail I mean there’s just you know you
08:56 have to you have to know those
08:57 businesses and you know they could be
08:59 tough so very tough so in your process
08:02 right so you started you’ve stayed in
08:04 this whole time you had a you had a job
08:07 so you kept did you keep working in the
08:09 three years or did you go yeah I took an
08:11 exit uh from the company after the
08:13 acquisition so I was I was full-time
08:15 searching for about a year and then um
08:19 an opportunity came up with a prior
08:21 colleague of mine that that kind of had
08:23 you know an easy fit in for me to go uh
08:26 take a a W2 employment and I did that uh
08:29 for about 18 months until I took till
09:32 this came up oh nice so it kind of
09:34 parlayed for you so you got a little you
09:35 got a little cash on the exit then you
09:37 you found an opportunity to sit down
09:39 with a buddy and maybe help him out for
09:40 18 months yeah I’m sure you probably
09:42 told him hey I’m searching and uh yeah I
09:45 mean I I you know we looked at
09:47 opportunities I mean I don’t think it
09:48 was uh I was that direct about it but
09:50 not knowing when it would happen you
09:51 know because I didn’t I didn’t want to
09:52 put a hard timeline on I could be gone
09:54 in five months I could be gone in you
09:55 know three two three years so um I
09:58 didn’t I didn’t put a fix time on worked
09:60 out in my favor because that’s you know
09:01 that’s the time when Co came through and
09:03 market for opportunities tried up a bit
09:05 so you know it it kind of kept me busy
09:09 so when you were going through your
09:10 search and then let’s talk like let’s go
09:12 search and then let’s go after post
09:13 close because I really want to talk
09:14 about like I I know we all talk about
09:16 search there’s the books there’s all
09:18 this stuff but man what happens like now
09:20 it’s closed right I mean that’s that’s
09:22 where the that’s where the fun Parts I
09:24 would agree yeah but uh but in that
09:26 process I’m sure you had to educate
09:27 yourself on the SBA loan um you educate
09:30 yourself on all of these different
10:31 mechanisms where did you find your
10:33 biggest challenge in the in that
10:34 threeyear
10:35 period gosh I mean I really just think
10:37 ultimately it was getting quality deal
10:39 flow and just trying to really you know
10:41 shake all the trees and get that I think
10:43 that you know some Brokers post on Biz
10:45 by cell some don’t uh most don’t have
10:48 you know a regular flow or email or or
10:50 or of new deals so it’s just really kind
10:52 of keeping up on that um I did talk to a
10:55 couple of business that are off market
10:57 and you know I know you get different
10:59 opinions on doing off-market deals uh my
10:02 struggle was that they were just
10:03 completely unprepared yeah um books were
10:07 a mess and you know that selling doesn’t
10:10 just happen right it’s it’s a process to
10:11 get prepared to sell and our first
10:13 acquisition together was a was a off
10:15 market and it took 11 months to close
10:17 because we had to clean the financials
10:19 up we had to get the QV I mean it was a
10:20 lot of work but I’ve done that in a
10:22 career path right so that I was okay
10:24 with all that yeah but if I was if I was
10:27 just straight searching no it’s yeah I
10:29 like like cas do that hard work you know
11:31 yeah you see thing if the books aren’t
11:34 clean and ready and they’re not you know
11:36 and and then you’re trying to go through
11:37 the loan process and the and the banker
11:39 asking for you know reports and the the
11:41 the seller is saying yeah I can get you
11:43 that in two weeks maybe and you’re like
11:44 I I just need a p&l from last month and
11:47 especi especially if it’s your first if
11:49 it’s your first alone too right like we
11:51 done we’ve collectively done a ton and
11:54 you know whenever A lender is asking a
11:55 question we typically know why what are
11:57 they looking for right so you can you
11:59 know Shine the best light on it and so
11:01 yeah it could be tough so then I guess
11:03 so how did you find the ston man and
11:04 ultimately was it you know from the
11:07 get-go you’re like this was the one or
11:09 you know was it something that you you
11:10 stumbled across you kind of shrugged it
11:12 off and looked back on I mean what’s
11:14 that how’d that come about so it it
11:15 popped up on the market through a local
11:17 broker uh here in Charlotte and I think
11:21 I I saw it on a Tuesday maybe first day
11:24 it was out there reached out to the
11:26 broker and uh set up a meeting we we did
11:29 a a zoom call and we’re about 45 minutes
12:32 into the zoom call and he’s kind of
12:34 working through it and I said yeah he
12:36 was he was uh not disclosing the name of
12:38 the company at the time he’s just sort
12:40 you know kind of revetting me although
12:41 I’ve talked to that that group before
12:43 and I said this is a stonem man and he
12:46 said yeah how how did you know that I
12:48 said well I know the owner and they put
12:51 in my pool and backyard three years ago
12:53 oh cool um so uh I had known George the
12:58 prior owner uh at that time probably for
12:00 about six or seven years and uh they
12:04 they had done some they had done a
12:05 project to my house so I was a customer
12:08 uh and I also threw some other
12:10 relationships uh knew one of the the
12:12 sales designers here knew the Project
12:14 Director so you know oh that helps L
12:18 that helps out a lot the relationship’s
12:20 like the hardest part right or one of
12:21 them one of the big things and The
12:22 credibility I mean you know do they do
12:24 good work or is it all smoking mirrors I
12:25 mean right so so I mean it kind of you
12:28 know it was it was a little bit luck he
12:30 was being discreet about selling it
13:31 because we had some mutual friends that
13:33 uh you know some knew that I was
13:34 searching but nobody knew he was selling
13:36 if if we would have both known that we
13:38 could of could have cut out the
13:39 middleman so to speak but uh but yeah
13:41 that was the that was it uh and then I
13:46 that was I think I met with them on I
13:47 met with the broker on Wednesday and put
13:49 an offer in on Thursday and closed 60
13:51 days after two days later after they
13:53 listed essentially they had an offer
13:55 accepted yeah probably the fastest I’ve
13:57 seen a business you know you SE on the
13:59 commercial real estate side kind of but
13:01 not on the it was three years in the
13:02 making it was like all of a sudden
13:04 you’re like I know the guy I know the
13:06 business I know the quality work and I
13:08 guarantee I guess you guys came up to a
13:10 deal structure so did he sell or carry
13:13 anything deal and you know was it
13:15 contentious on pricing or was it
13:17 everybody kind of align on how to Value
13:18 it it wasn’t contentious on pricing you
13:20 know like I said doing this for three
13:22 years in the Charlotte Market I had a
13:23 pretty good feel for what things were
13:25 going for and what the opportunity was
13:27 um that doesn’t mean the seller has that
13:29 same that’s the problem he did not take
14:31 a seller note uh he he they said that
14:33 from the GetGo he wasn’t interested in a
14:34 seller note um and because because I
14:38 really knew him and we’ve got some a lot
14:40 of mutual friends I figured there’s a
14:41 little bit of Social Capital there to
14:43 kind of to go into that so I was willing
14:45 to to forgo that knowing a bit of a risk
14:47 certainly on my end but uh but yeah I
14:49 mean I put the offer in you know pretty
14:51 much right away on the on the base
14:53 numbers and the the broker said well you
14:55 haven’t seen all the the tax returns yet
14:57 and I said well I’ve seen the Sim so
14:59 either the tax returns match or you’re
14:01 not telling me the truth so we’ll figure
14:02 that out later yeah exactly it’s just
14:04 you’re putting the offer in to say hey I
14:05 want it off the market because this is
14:07 my this is the one I want yeah so if
14:09 what you’re telling me is the truth then
14:10 we’re good if if you’re telling me it’s
14:12 not the truth then we’ll deal with that
14:13 later yeah so what was the multiple and
14:15 then were you guys aligned on that or
14:16 was there a little bit of kind of tit
14:18 fortat to get you know obviously the the
14:20 the seller carry is one thing but at
14:22 least pricing was it pretty quick or
14:24 sometimes that can get complicated for a
14:26 lot of different reasons yeah the
14:27 pricing you know we we were were you
15:30 know at at a at a three-year average we
15:33 were about right at uh right at three
15:35 but on the on the prior year it was
15:37 probably about a 27 28 multiple nice
15:41 there’s not much to argue there you’re L
15:43 it right in the pocket yeah it was it
15:45 was a fair price uh he was comfortable
15:47 with it so that part of the negotiation
15:49 really you know that’s what the
15:50 middleman probably did you a favor on
15:52 right they they level set him I mean
15:53 sometimes you see where the broker
15:55 saying hey I can probably get you a four
15:56 and a half 5x and yeah you know then
15:59 it’s yeah you as a buyer have a much
15:01 bigger Gap to try to Bridge and reset so
15:03 that’s true you know if you would have
15:04 been direct with him he may he may not
15:06 have understood the multiples and that
15:07 means the broker did his job yeah and I
15:10 I mean I used uh Viking mergers which is
15:12 here based in Charlotte uh I think they
15:15 actually just open up a shop there in
15:16 Houston they’ve been kind of expanding
15:18 really uh and for for this Market uh I
15:20 mean they’re they’re the they’re the
15:22 largest around and they do a really good
15:23 job I would say they they had a really
15:25 good plan to get us from you know right
15:27 through closing and that’s that I mean
15:29 because of we could do it in 60 days
16:31 that’s outstanding awesome all right so
16:32 now we’ve closed
16:34 right yeah just really so you got you
16:36 basically no seller carry no seller uh
16:40 no no seller note no seller roll nothing
16:42 right you did a straight vanilla SBA yep
16:45 down the- middle deal right that’s right
16:48 how much you end up putting down 10
16:49 percentage I I put in 10 percent because
16:51 I hit this window that was part of the
16:53 cares act where uh SBA was back in 90%
16:56 of the loan so uh the bank for didn’t
16:60 really care much that’s the 10% so um I
16:03 took that I had more Capital than I
16:04 could have put in I but I I pow I put it
16:08 up so you know I know folks get nervous
16:09 about a 90% debt on something but me
16:13 personally I wasn’t at 90% debt the
16:15 business was but I had you know yeah the
16:17 thing that for people don’t realize
16:18 right again I come from kind of a
16:19 commercial background Acumen but like
16:21 whenever you buy something at a 3X
16:22 multiple right you’re really getting a
16:25 33x a 33 you know cap 33% you know of of
16:30 cash flow there right and so there’s
17:32 plenty to go around to be able to
17:33 service a note that’s also not that
17:34 expensive to begin with and so leverage
17:36 works out really well in your favor
17:38 whenever you’re in that high of a you
17:40 know margin cash flowing business sure
17:42 yeah until that SBA note goes to 11 in a
17:45 quarter and then you’re like come on
17:47 come on fed you gotta come down some bit
17:49 you know hopeful we get a little little
17:51 news here next month I yeah I have an
17:53 SBA load myself first I did a solo
17:56 acquisition in 19 and and I know I was
17:58 at six I went from closed at seven and a
17:01 quarter it went to
17:03 6.75 and then it just went right I
17:06 looked the other I was talking to my
17:08 loan officer there he’s like man you’re
17:09 at 11 and a half and I’m like this is
17:11 just he’s like you’ve literally your
17:13 mortgage you’ve doubled I’m like
17:15 unbelievable not to go off on a tangent
17:17 but maybe an interesting nugget for
17:18 listeners right maybe even you Ellen so
17:20 on the commercial real estate side A lot
17:22 of times the lenders Force us to buy a
17:23 cat right which is like insurance it’s
17:25 hedging on the upside and it’s not
17:27 really common in the business space but
17:29 there’s a world where if I like my 5% I
18:31 want my business to be safe you spend
18:34 probably 20 grand and you will reduce
18:36 any upside risk for the next five years
18:38 yeah so I mean that’s not a thing in
18:40 kind of the m&a space but I’m I’m sure
18:43 Chatham is kind of one of the big ones
18:44 I’m sure they will sell a cap to help
18:46 reduce that exposure so anyways well
18:48 that would have been good information
18:49 three years
18:51 ago right now I don’t need it right now
18:53 I don’t need years right now you’re
18:54 betting on it going down right but it’s
18:56 also that’s whenever they’re the
18:57 cheapest so
18:59 oh what a all right so we’ve closed
18:01 you’ve got your financing you’ve got all
18:03 your stuff done so how did that first
18:04 100 days look are you one of those guys
18:06 that you know I’m a big 100 day game
18:08 plan guy that’s I’ve just been like that
18:10 through the last two Acquisitions even
18:12 when we did the startup it was all about
18:14 man we got the capital in how are we
18:16 goingon to execute the next 100 days
18:18 what was your strategy yeah I had about
18:21 uh I had about 78 days with the seller
18:25 uh before he was going to head out on
18:26 vacation and we agreed that he could
18:28 come in and advise you know the rest of
18:29 the year as necessary but uh you know it
19:33 was really about getting you know
19:35 engaged getting understanding the
19:36 systems understanding the people
19:38 understanding the projects I mean it was
19:39 it was definitely a uh you know a lot of
19:43 just absorbing it you know I wasn’t
19:45 coming in you know with a with a ton of
19:47 experience directly in this space so it
19:49 took quite a bit you know had a few
19:51 hiccups along the way um but you know
19:54 really by the time he he headed out
19:55 about 70 days after closeth uh I felt
19:59 like had a pretty good handle on things
19:00 as as good as it was going to get at the
19:02 time uh you know we do about 80 projects
19:04 a year so at some point I had seen the
19:07 beginning the middle and the end of of a
19:09 project not all the same project but you
19:12 know probably have 15 going on at any
19:13 given time right right so how many
19:16 employees I’ve only got 12 12 got it
19:19 executing 80 projects a year yeah I’ve
19:22 got uh impressive I’m guessing a lot of
19:24 it subbed out right they’re we’re doing
19:26 more the project management and the
19:27 quality of we do the sales the project
19:29 management the quality yeah and the rest
20:30 of it sub down but we have a really
20:32 close relationship uh a lot of the sub
20:35 teams you know they’ve been with us for
20:36 more than a decade uh and you know they
20:39 just they just keep kind of keep rolling
20:41 with them and they they provide great
20:42 service they understand how we work and
20:45 how we operate and how we you know we
20:46 pay them fairly you know and one thing
20:48 we do as the small business is I I write
20:50 them a check every week and uh for what
20:52 they work the last week so um they know
20:55 that if they come work for us they’re
20:57 going to get paid we’re not going to
20:58 drag them out 30 days or 60 days and um
20:00 for those guys it’s meaningful no
20:02 absolutely significant no the company
20:04 H&M plating um one of the things the
20:06 owner that we had that he said do not
20:08 change our payroll we do a weekly
20:10 payroll yeah he was like I know it’s
20:12 it’s a lot of it’s extra work it’s all
20:14 this stuff he’s like but man he’s like
20:16 that having a check every week for our
20:18 guys is critical yeah and he had gone
20:20 from bi-weekly you know 10 years ago to
20:23 weekly and he said morale just shifted
20:25 it was like it so pretty pretty pretty
20:27 incredible pay weekly so a lot of the
20:29 subs and people I’m sure you get a lot
21:32 of commitment a lot of Engagement yeah I
21:33 mean they they they’re they’re really
21:35 good they’re always willing to help us
21:36 out and uh and we you know we we try our
21:39 best to take care of them and you know
21:41 some some customers will say well could
21:42 you get somebody cheaper and I said
21:44 maybe but these are guys I know who are
21:45 going to do good work and and we can
21:47 trust so did this company going in did
21:50 he have uh so they they’ve been in
21:52 business for how long you said 20 years
21:54 about 20 years so he had a he had did he
21:57 have like a leadership plan some core
21:59 people like did he did you have like a
21:02 this is how my business works like a
21:04 system or did you have to kind of pick
21:07 it out of his head and start developing
21:08 it yourself now he had a pretty good
21:10 system although I would say it was
21:11 mostly uh mostly paper based and you
21:14 know email-based and kind of kind of uh
21:17 but they had a pretty good process to go
21:19 from sale through uh estimating and and
21:22 into production um we’ve got a project
21:25 director who’s been with us for over a
21:26 decade who’s who’s fantastic uh and a
21:29 couple other project managers the sales
22:31 team is probably the newest and the
22:33 prior owner was really for a long time
22:35 the only or the primary sales guy I
22:38 think that’s really what was kind of
22:40 driving some of the exhaustion yeah from
22:43 because it was just all on him um so we
22:45 when I came in we had one of the sales
22:47 designers had been here about three
22:48 years U another one was relatively new
22:50 although she had been in this market for
22:52 a long time so she was you know pretty
22:54 good to get up to speed and a great
22:56 designer so um you know so I’ve I’ve
22:59 tried to position myself where uh the
22:03 sales team does all the sales uh I tell
22:05 them I only pick up things that that
22:07 come in that are out of the norm for us
22:10 or maybe they’re technically complex or
22:11 something like that that I’ll I’ll kind
22:13 of jump in or person relationship you
22:14 know I’ll jump in on so I mean so did
22:16 you step into buying it initially saying
22:19 hey there’s deficiencies in these areas
22:21 maybe sales is one of them and these are
22:23 the improvements I’m going to make or
22:24 was it more so you know you just knew it
22:25 was kind of ho home and if you left it
22:27 as is for the first year that’s not a
22:29 problem right he didn’t feel the need to
23:30 go make big changes no you just slowly
23:33 iterated I what’s been your approach
23:35 yeah I really didn’t I didn’t come in
23:36 feeling like I needed to make wholesale
23:38 changes to be honest with you I mean
23:39 there was some you know having a
23:40 technology background understanding that
23:41 there was some things I wanted to
23:42 convert I knew I knew the marketing in
23:45 the I knew the brand was strong in the
23:46 market but I know the marketing was
23:47 really not robust um so I’ve kind of
23:51 been focused on that kind of Drive brand
23:53 presence and and and and continuing to
23:55 build out our marketing you know Google
23:57 reviews and so forth
23:59 uh to kind of build that up um but but
23:02 ultimately no it wasn’t really about I
23:04 need to kind of wholesale change what’s
23:06 going on here I believed in what the
23:07 team had and what they’re working on um
23:09 we have since brought in some tools and
23:11 some Automation and and you know some
23:13 other things to to make things better
23:16 but you know the fundamental core of the
23:19 process he had in place still exist and
23:21 how we get from sale through through
23:22 production that’s pretty fantastic
23:24 because I’ll tell you that that means
23:25 you found the right business you bought
23:27 it at the right price so that’s a great
23:29 story to hear yeah what are the
24:31 challenges you faced what do you what do
24:32 you feel like now that you’re you’re the
24:34 uh the owner you’re running your own
24:36 show what are those things where you’re
24:37 like ah man this is tough or has it just
24:40 been been pretty good for you stone is a
24:43 very hard surface so it’s very tough it
24:45 sounds is the true St yeah you know I
24:48 think there’s there’s just you know
24:50 evolution in in some of the design
24:52 features and things like that we were we
24:54 are are really skilled in Natural Stone
24:57 uh probably one of only you know two or
24:59 three uh companies in the market that
24:02 can do some of the Natural Stone work
24:04 that we do uh but but not every customer
24:07 wants Natural Stone so there’s some
24:08 other Alternatives with with brick and
24:10 stucco and and some manufactured Stone
24:12 Products and things like that that are a
24:14 little bit more Sleek a little bit more
24:15 modern that that folks want so it’s kind
24:16 of the evolution in to be able to do
24:18 those things and and kind of build it
24:19 was a product Evolution for you it was
24:20 more product because the business is
24:22 working it’s churning it’s he’s got a
24:24 good system right that’s fantastic did
24:27 you do anything for the employees did
24:28 you do like did you did you have to come
25:30 in and say hey I’m going to give these
25:32 guy give any one person incentive profit
25:34 sharing did did anything shift like that
25:37 for you not immediately uh in that sense
25:40 I’m I’m a you know kind of like your
25:41 your point about you know paying weekly
25:43 I’m a I’m a big Advocate that the one
25:47 thing that will frustrate people the
25:48 fastest is if you start messing with
25:49 their money 100 per. and uh and so I
25:53 really kind of kept that the same um I
25:55 did do some Evolution uh I wouldn’t say
25:58 it was massive changes but some
25:59 Evolution on on how some of the the
25:02 bonus comp plans were done uh but I
25:04 think I think a big part was I brought
25:06 in healthcare uh they didn’t have they
25:09 didn’t have health care uh at all and I
25:11 noticed when I was trying to trying to
25:13 hire it was definitely an inhibitor to
25:14 hiring I had to find the right person
25:16 who you know maybe married or otherwise
25:18 had had health care so I was able to
25:20 bring that in and get that in for the
25:21 guys at at a good price I mean I think I
25:23 I think I started out they were paying
25:26 um 35 bucks every two weeks for full
25:29 medical dental and vision nice and so uh
26:33 got a lot more expensive the past year
26:34 though it has but you know it’s a small
26:36 team and so we’re able to kind of make
26:38 it work uh because you’re investing in
26:41 your people yeah yeah I mean you know
26:43 trying to get them to that this can be a
26:45 place they can stay and and quite
26:47 frankly you know it creates
26:48 opportunities you know for some of those
26:49 who maybe their spouse was the provider
26:51 of of insurance well now spouse has some
26:53 flexibility on whether they change jobs
26:55 or do something different so uh you know
26:57 and and frankly it’s it’s a recruiting
26:59 perspective it just I had to do it
26:01 because I was i’ probably lose 75% of my
26:03 potential recruits just not having
26:04 health insurance yeah know I totally
26:06 understand I mean yeah it’s you have to
26:07 be competitive out there and you know
26:09 benefits are a big part of it yeah so
26:11 are you so are you working with your
26:12 team like are you guys are y’all doing
26:14 three here’s where we want to be in
26:16 three years five years are you using any
26:18 like uh traction EOS anything like that
26:21 or is it all just kind of how you would
26:22 build your own business like like you’ve
26:24 kind of come up with your plan yeah they
26:26 they had some models in place they used
26:28 uh
26:29 uh Rhythm systems was a prior vendor
27:31 they used to kind of develop some early
27:33 uh processes and goals uh so we’ve kind
27:35 of taken that taken elements of EOS and
27:37 kind of push them together into some of
27:39 those goals uh and are trying to drive
27:41 through some of that so you know what I
27:44 say we’re following EOS to uh to a t no
27:46 not even not even close really um but
27:49 but the general principles are there and
27:50 and we have a lot of processes in place
27:53 already so it wasn’t I wasn’t coming in
27:54 cold on some of that stuff to kind of
27:56 reinvent that that’s awesome so you’re
27:58 you’re coming up on three years right is
27:59 that right that’s right and so you know
27:02 three years into it how much have you
27:03 grown revenue and overall been have you
27:05 been happy with the with the yeah the
27:07 acquisition or any you know you’re like
27:09 man it’s been not what I expected but
27:12 it’s been a kind of where you’re at
27:15 growth has been you know it’s been
27:16 pretty flat um but I I’ll be honest I
27:19 and I knew this going into it uh there
27:21 was a big Co bump right uh and and there
27:24 was a lot of leads coming in early covid
27:27 and uh the prior team that was here said
28:30 you know they they they went through
28:32 that that sort of window of okay it’s co
28:34 we’re shutting down we can’t work to
28:36 okay the construction is considered a a
28:40 you know Cal business essential business
28:42 yeah and they’ll stay open and they said
28:44 it was kind of quiet and all of a sudden
28:46 one day the phone rang and this woman uh
28:49 had clearly spent a lot of time on her
28:51 back patio with her friends drinking
28:52 wine and she said if we’re going to have
28:54 to be six feet apart I’m going to need a
28:55 bigger patio and uh and so uh that that
28:60 kind of was just the start of just just
28:02 kind of gang busters through that time
28:03 so there was a lot of pull through right
28:05 people who were going to build pools in
28:07 outdoor spaces in a year or two years or
28:09 three years probably pulled them
28:11 early uh so I think we’ve done pretty
28:13 well to to hang flat uh right now
28:15 especially this year um I know we
28:18 partner with a lot of pool builders uh I
28:20 think pool building’s been cut in half
28:22 um uh we’re seeing other vendors go out
28:24 so we’re we’re St interest rates are you
28:26 feeling it it’s it’s an interest rate
28:27 thing because I know that the the home
28:29 equity line of credit everything it’s
29:31 all relatively I think you you kind of
29:33 got a little bit of interest rates are
29:35 certainly part of it I think that uh um
29:39 you know some of the pull through so
29:40 some of the projects have been done
29:41 earlier and people have already
29:42 completed I think that you’re not
29:44 getting a lot of movement in real estate
29:46 and so people who might be moving in and
29:48 then doing something new to their
29:49 backyard aren’t really moving that much
29:50 so you get some stagnation there and
29:53 then the other part is just you know
29:54 frankly the election I think some people
29:56 say I just want to wait till the end of
29:58 the election
29:59 I kind of argue I’m like you know
29:01 whoever wins does that really matter
29:02 whether
29:03 you just like what we were talking about
29:05 it yesterday I got an email from a guy
29:07 I’ve been talking to about his company
29:08 for you know probably about a year and
29:10 he was like let’s talk after the
29:12 election and then he gave me like seven
29:14 like little dot dot dot dot dot dot dot
29:16 yeah I don’t know what that meant I
29:17 didn’t know how to call him and be like
29:18 what does that mean but it just me gave
29:20 you seven so that’s an odd number
29:22 right the dots I always do yeah so I
29:26 don’t know I mean I don’t know why I
29:27 think people just feel a sense of
29:29 uneasiness for whichever direction
30:31 things may go and they just want that to
30:33 settle out and and so we we’ll kind of
30:36 we’ll pick back up here and I expect you
30:38 know a much better year next year I
30:39 think once things settle out in that
30:40 direction and you hopefully we see a
30:41 little bit of forgiveness and interest
30:43 rates and you know a little bit more
30:44 movement in the market yeah I just I
30:46 just got off I’m a I’m a follow of a
30:48 group called ITR economics and uh just
30:50 got off one of their webinars they had a
30:52 good twoh hour kind of like you pay 300
30:55 bucks get to watch the presentation very
30:57 bullish on and 26 and 27 just in in
30:00 these you know very bullish on the
30:02 economy no matter not not even about who
30:04 the president is so we’ll see if they’re
30:05 right but they they they report like a
30:07 95% accuracy in in one year of their
30:10 economics they’ve been in business since
30:12 the 40s so I was like man I’ve been
30:14 following these guys I’m like wow let’s
30:16 just see I’m hoping let’s go yeah I’m
30:17 hopeful so I we’re we’re in we’re in a
30:19 spot where I kind of estimated we’d be
30:20 in this year but the first half of the
30:22 year was great we crushed it second half
30:23 will be a little bit flat but uh you
30:25 know forecasted that and you know I
30:28 think you’re Point FIS about just the
30:29 you know buying in at the right multiple
31:31 and kind of keeping things steady you
31:32 know you don’t have to blow it out of
31:34 the water so that’s awesome if you buy
31:36 it right Life’s a lot easier so it makes
31:39 a big difference awesome all right well
31:42 let’s go ahead and get on to our rocket
31:43 rounds so this is where we ask the Audi
31:46 the the speakers three of the same
31:48 questions so Casey all right off so Alan
31:51 what do you like to do in your free time
31:53 uh I do a lot of running uh with with uh
31:56 some of my friends and we we typically
31:58 longdistance relays I’ve got one coming
31:60 up next week uh the Blue Ridge Relay
31:02 it’s a it’s a 210 mile 30 hour Adventure
31:06 uh we’re gonna run through the mountains
31:08 and so you’re an ultra guy well I’m not
31:11 well my net will be about 25 miles over
31:13 four runs during the weekend so we we
31:15 kind of run in uh in succession uh
31:18 there’ll be nine of us we just kind of
31:19 rotate through and we we start Friday
31:21 morning and we keep running through the
31:22 night yeah see give me and Casey a
31:24 mountain we’ll climb up and up mountains
31:26 but running is a whole I don’t know I
31:28 just it’s it’s it’s kind of a blast of a
31:30 weekend it’s I mean it’s really it’s
32:31 challenging uh but this will be on this
32:34 course this will be my eighth running
32:35 and we’ve done a couple other ones uh
32:37 Hood to Coast out in Portland a couple
32:38 years ago so they’re called relays huh
32:40 yeah it’s a relay so we it’s you just
32:42 take a van and you let one guy start
32:44 running and you Leap Frog and you you
32:46 get up there when he’s done his leg you
32:47 he hops in the van the next guy moves on
32:50 so see but they do in the mountains and
32:52 so he’s looking at what other Stone
32:54 options are out there so it’s all a
32:55 business suspense at the end of the day
32:57 you know sometimes you get the downhill
32:58 sometimes you get the uphill yeah all
32:01 right next question uh what’s been your
32:03 most memorable moment in your business
32:04 Journey most memorable moment you know I
32:07 think that first day was was was uh one
32:11 thing that that really hits me the the
32:13 seller met with the team uh on their
32:15 standard Monday morning meeting and kind
32:16 of gave him the the uh update that he
32:19 had sold the business and then I came in
32:21 with my wife about 30 minutes later and
32:23 you’re just kind of standing in front of
32:24 this group and they’re a little bit
32:26 shell shocked and you’re a little bit
32:27 nervous and uh you know you’re just just
33:31 trying to get through that but uh the
33:32 team’s been just been fantastic so
33:35 that’s awesome it worked out all right
33:37 last question so what’s your favorite
33:39 tool or resource well tool I know we’ve
33:41 got a lot of bobcats so uh you know not
33:44 that it it helps the business uh you
33:46 know running the business every day but
33:47 it’s fun to get on the excavator if we
33:48 need to kind of clean some stuff up uh
33:50 so we we do have we do some toys back
33:53 there but um man I tell you so simple uh
33:58 I’ve got this uh high-speed scanner and
33:01 this place used to run on all paper I
33:02 got boxes and boxes of paper from years
33:04 ago in the attic and now the team just
33:06 blasts everything through the highspeed
33:07 scanner it automatically goes into
33:09 Dropbox my my office manager kind of
33:12 repurposes everything gets into
33:13 QuickBooks and and it’s it’s the
33:15 simplest little tool but cleans up the
33:17 place really nice oh yeah no being
33:19 digital I me like I said I we have one
33:21 printer in in the entire office and it’s
33:23 a pretty big office and yeah telling
33:25 people I’m going to throw that away one
33:26 day we’re going to get them fully it’s
33:27 really the account team that likes to
33:29 print stuff so they can look at numbers
34:30 you know that’s that’s the problem I
34:31 have so well I mean that the challenge
34:33 is we’ve got guys in the field and
34:35 they’re you know each of my PMS is
34:36 running multiple projects so they kind
34:37 of keep a folder with with drawings and
34:40 and estimates and and all that kind of
34:41 stuff so we we kind of need to have some
34:43 paper but uh you know at the end of it
34:45 all it just all gets it gets all filed
34:47 electronically and it’s just great
34:48 because now they’ve got ability to go
34:50 back on Old projects and review photos
34:52 and estimates and and all kinds of stuff
34:54 together so docy scan I think docy scan
34:57 that’s that’s the we used over at H&M
34:59 docy scan no uh this this just it files
34:03 it right into Dropbox and then it sorts
34:05 outter where it’ll just drop it in yeah
34:08 and then it but you can set which folder
34:09 it goes into and so depending on where
34:11 it ends up office manager can kind of
34:13 take that and and migrate around as we
34:15 need to um you know whether it’s going
34:17 into the accounting system or whether
34:20 it’s going to go into the customer file
34:21 that kind of stuff badass right there we
34:24 have itan it’s it’s pretty simple but
34:26 it’s best 400 bucks you can spend hey
34:28 money well spent sometimes it’s those
34:30 simple things people don’t realize but
35:31 the problem is that buying it is easy
35:32 it’s forcing people to build a habit
35:34 after that so yeah they’re pretty used
35:36 to me now that I I don’t I don’t keep
35:38 much paper around I mean I’ll use it and
35:40 then scan it or toss it but uh yeah so
35:43 we’re we’re we’re now almost four years
35:45 worth of completely paperless at the end
35:47 versus the uh the old file cabinets this
35:49 used to sit around and then when you get
35:50 bored you go out and you run around on
35:52 the Bobcat so I don’t blame you we we do
35:54 that sometimes too all right perfect
35:57 well I don’t know definitely enjoyed it
35:59 them how can listeners get a hold of you
35:00 sure they can reach out to me uh right
35:03 at my Stow man account it’s Allan Al an
35:07 Stoneman rocks.com s t o n m an r o c KS
35:12 I love it perfect I haven’t been able to
35:14 buy the the the Stoneman uh URL I’ve
35:17 tried to reach out to that guy a couple
35:18 times to buy it but he won’t
35:21 respond he’s going to keep it for a
35:23 while I used to do a bunch of domain
35:24 flipping back in high school so I it’s
35:26 underutilized itates even he’s not even
35:29 using it and his brand name is different
36:30 anyway so czy fun times cool all right
36:34 well we’ll call it a wrap Allan thank
36:35 you very much really appreciate it and
36:38 listeners you know sure there’s tons of
36:39 information sure thanks guys appreciate
36:41 it thank you for listening to the m&a
36:43 Launchpad podcast if you’ve enjoyed
36:45 today’s podcast and would like to
36:46 support us please leave us a rating and
36:48 a review after you listen if you’re
36:49 looking for guidance on your next
36:51 business acquisition or sale Capital to
36:53 support your next business transaction
36:55 or to invest in a private Equity
36:57 opportunity visit Equity launchpad.com
36:59 to learn more and to connect with our
36:01 team if you know of an individual who
36:03 would be a great guest for the show head
36:04 over to equity launchpad.com
36:07 nominate where you’ll have the chance to
36:09 refer yourself or someone else to be a
36:11 guest on our show I’m Casey muu and I
36:13 look forward to talking with you next
36:14 week