Patrick Baldwin: We had David Billingsly way back in episode 24. Maybe a little bonus when I was with Shane Hoy.
Paul Giannamore: When we had David on is when we had to change the rating in the podcast on Apple.
Patrick Baldwin: A little extra explicit. I figure, why not throw him a couple of more softballs and get him his own episode? We brought him in for Bubble Trouble. David Billingsly, welcome to the San Juan border.
David Billingsly: Thanks for having me. This has been a fun trip.
Paul Giannamore: We keep upgrading the Boardroom.
David Billingsly: You guys are great hosts. The bar keeps rising. Happy to be here.
Patrick Baldwin: Last time I was in San Juan, you hung up a phone call and said, “David's for hire.” I’m like, “What are you talking about?” You said, “You got a new free agent on the market.”
David Billingsly: I’m trying to figure out what I want to do when I grow up. I'm entertaining a few things, but it's been a good couple of months off. I needed it. I was telling my wife, “If there was a way for me to take a few months off…” I took a few months off.
Patrick Baldwin: No AX gag order. He can say whatever he wants. He's his own HR department.
Paul Giannamore: Nothing stopped him before though. I never got the impression he was holding anything back.
David Billingsly: Wait till we're done with this episode. Strap it up. Here we go.
Paul Giannamore: What are we doing today, Patrick? What's on your mind?
Patrick Baldwin: Why not bring an expert in that's helped grow a few businesses. American and the western side of AX, you brought on a couple of great platforms while you're there but I've got a lot to learn still. You're a lot older than me.
David Billingsly: I am the elder statesman in the room.
Patrick Baldwin: Bare minimum, the elder.
David Billingsly: By the way, I'm a far cry from an expert so I appreciate that.
Patrick Baldwin: We’ll see. We’ll be the judge.
David Billingsly: Skeeter may disagree with that.
Patrick Baldwin: Cousin Skeeter.
David Billingsly: He’s always here. It's the drinking game, everybody. Every time I say Skeeter, you have to drink. Where are the drinks? It’s just water today.
Paul Giannamore: Would you care for a Macallan?
Patrick Baldwin: He's going to say no to that.
David Billingsly: I was going to say yes. It's 5:00 somewhere.
Paul Giannamore: We have some crystal-clear glasses over there.
David Billingsly: I am super excited about that. It’s a great idea.
Patrick Baldwin: Happy Cinco de Mayo.
Paul Giannamore: We should have brought the Mexican in today.
David Billingsly: It’s so much more peaceful today. I'm sure he still has those stupid swim trunks on.
Patrick Baldwin: I'm sure he does. We were chatting about leadership development. David, you've developed a few leaders. Your admin team, they're American. You had your platforms. Dena. You got to get Kevin a promotion. Shane Hoy.
David Billingsly: Kevin got himself for promotion. Kevin Poland is now the president at American. He started at American as a marketing intern there. He’s a college athlete. He came in as a young kid and was willing to listen and learn. Matt worked with him for years. One of my jobs Matt told me over the years was, “We want to develop this young guy to be a future leader for us.” For me, there's that proud papa moment. I'm so proud of him. It's a great opportunity for him. He's got a great team there. He needs to build that out. He's running a $50 million business.
Paul Giannamore: We'll tell you one thing. After the Mexican met him for the first time, this is before you left and went out to the West Coast, he identified and said, “That kid could be running this business.”
David Billingsly: He was right.
Paul Giannamore: He always says, “I can read people.” On occasion, he gets it right. He figured it out.
David Billingsly: A broken clock is right twice a day.
Patrick Baldwin: It sounds like it's almost this pay it forward though. Did Jay and Matt Nixon invest in you?
David Billingsly: I grew up in this bubble. I started at American in 2006. I started at the bottom, sales, and service. I had some leadership background. I ran stores for Brooks Brothers. I was a retail management guy. I did that for almost a decade. Matt was a huge Vistage guy. He quickly realized that to develop me, there was going to be a lot of polishing going on. He got me a business coach.
I took over the commercial operations around when we became Copesan partners in 2008 and 2009. He allowed me to attend the Associated meetings. We were part of Copasen at the time. I got a chance to be on some committees and meet some amazing people. Matt understood what it takes to develop your talent. He'd always wanted to grow the business.
Out of the gate, I was like, “This guy wants to grow all the time. What’s up with this?” He said, “If we're not going to grow the business, then how are we going to hold on to our talent long term?” Matt understood that. He developed me enough and pounded into my head enough that we needed to do those things. Most of my direct reports at American had some type of a business coach. Vistage has some emerging leader programs now for tier 3 and tier 4 team members. We put most of our branch managers through that.
Either through the Vistage network or other networking in the DC area, almost all my direct reports had some type of business coach. While that was part of my job, I also wanted to be able to support them and develop those habits and those traits they need to be successful. Our job as leaders is to make sure that we are equipping our team members with the right tools so they can be successful and do a good job.
Patrick Baldwin: It is a significant investment in the P&L.
David Billingsly: It's not for the faint of heart. Matt understood that. We even took it a step further in regards to developing a leadership training program there. We had one for emerging leaders, which was almost a feeder because you never know who's the future leader within the technician base, the administrative base, CSRs, and things like that. How are you identifying those folks?
We developed a plan. You had to apply for it and get two letters of recommendation either from your peers or elsewhere. We would do it twice a year. It was a three-month program. The leadership team would review the resumes and we would select 10 to 12 individuals. I just wanted to develop our team members. They could have been future leaders for us or they could have been future leaders for somebody else.
That helped us be able to say, “We care about you guys. We want to give folks opportunities so you have this.” From there, we developed a larger plan which I called our Leadership Development Group, which I completely stole from NPMA. That was for all of our middle managers. We did it six times a year. Every other month, evens or odds, depending on who you were, we had about 30 managers inside of that. We do some excerpts of books or read a specific book. It's all about self-awareness, leadership training, how you treat people, and how you deal with something. We’re trying to give those folks the tools they need to do their jobs.
Paul Giannamore: Take me back. You were an angry young man and Matt Nixon got you a coach. What happened? You sit down with a coach, was it like being with a shrink?
David Billingsly: It's a little bit of therapy. Doug Groves, the business owner there in the DC area, owned a hard surface company. He did countertops and stuff like that. In 2008, when the housing bubble burst, not a spectacular business to be in. Doug was a Vistage guy as well and he started his own coaching company. Doug was a little older and wiser and here I am, this young, full of piss and vinegar, rough around the edges. I like to use the F word a lot.
For those that know me, I can be a little passionate about things. That passion didn't necessarily correlate well with a professional work environment. Thank God, Matt saw something in me and was willing to invest in that to have Doug come in and buff off some of those rough edges. Doug used to always say, “David, I've got a thought.” That was my opportunity to get my pencil out and write something down because he was about to smash me up against the side of the head with the 2x4. That usually resonates for me and gets the point across.
We would meet on a monthly basis, usually 2 or 3 hours, and then I'd have access to Doug throughout the month if I had something or a situation that maybe I felt a little more comfortable talking with him about versus talking to Matt about. I had the best of both worlds. I had Matt who was a great resource, a super-smart guy, a great business owner, and successful. He also had this other sounding board there that was part business coach and mostly therapist.
Paul Giannamore: Outside the business, so separately. Did you find value in the fact that he was not part of American and you were dealing with somebody separate from the company?
David Billingsly: Absolutely. You can tell your boss lots of things.
Paul Giannamore: But you can't tell your boss everything.
David Billingsly: I've got to have the occasional bitch session with Doug a little bit. I'd cry a little bit maybe, and then he'd break out the 2x4 and get me back into place. As I began to sit in Matt’s seat later on, there's no doubt that there was a tremendous amount of value that I didn't have to have some of those bid sessions with my direct reports. They could do those with those business coaches. It allowed me to reserve some of that emotional energy and place it in different places in the business, which I don't necessarily think everybody always thinks about.
Patrick Baldwin: Confidentiality is in my head. I've seen where the business coach comes in and he has the conversation with the second level, not the owner, and then he goes to the owner and says, “Here's what we talked about. Here's what you need to do. Here's everything that's wrong with the business.” You've been on both sides, between you and Matt and then between you and your future direct reports. Where does confidentiality play in with an outside coach?
David Billingsly: The Vistage role is like Fight Club. What happens in Vistage, stays in Vistage.
Patrick Baldwin: You said that about Puerto Rico.
David Billingsly: I did. Thanks for violating rule number one, and then rule thumb number two is don't talk about Fight Club. There's that level of confidentiality. Matt, my coach, Doug, and I all had that same agreement, “The conversations I have with David, they're between David and me. However, if David's embezzling money or David's doing something bad, Matt, I'll talk to you about that.”
On a yearly basis, Doug and Matt would meet outside of me and talk about, “How's David's development coming?” Feedback from that. “Matt, are you seeing value for what I'm doing to help David?” Then are there any goals or opportunities from the owner’s perspective that he wanted to see Doug help me with throughout the course of the year?
If you are going to engage in some type of coaching for your level 2s or 3s, you do still need to be involved with those. It's not just washing your hands with it and saying, “They're going to take care of this.” In some instances, that works. At least once a year or twice a year as an owner, you should be touching base with that coach to make sure how that person's development is going. “We wanted to work on these few goals and be intentional. Is that going the way we wanted it to go?” There's a lot of value in that. Confidentiality is important. I shared a lot of private stuff with Doug and that's where it stayed.
Paul Giannamore: How long did you do that for?
David Billingsly: Four years.
Paul Giannamore: If you look back now, what are the 1 or 2 most important benefits that you can remember having gotten from that?
David Billingsly: Matt used to always tell me this and Doug reinforced this. I'm a pretty fiery guy but never too high and never too low. Sales guys can be manic. Our highs are highs and our lows are lows. Jim Zorn said this when they were the Redskins. They're the commanders now. When he was the Redskins’ coach, he said, “I want us to practice being medium.” I used to always joke around, “Practice and be in medium.”
One of the reasons I went to American is so I could help coach some of Andrew’s soccer teams and do some of that stuff. The parents used to call me Maximum Dave because I'm on a soccer field with 8 years old and I'm screaming at the refs, “That’s a BS call.” I'm a football guy. I’m apparently not supposed to do that in soccer.
Paul Giannamore: Not with 8-year-olds.
David Billingsly: They called me Maximum Dave because when I invest in something and I'm passionate about something, I get pretty fired up about it. As the leader of an organization that I took over at American at $12 million, $13 million with 120 team members to fast forward, almost $50 million and 300, 400 team members, or whatever we have, you're not allowed to act that way anymore. I knew that I had to change if I ever wanted to get there.
That's the other part of this. You can get business coaches for your team members, but if they don't want to change and they are pretty set in their ways, then you're going to be throwing money away. You’ve got to have a person that is willing to want the change. I was scared to death that the business was going to leave me behind because that happens a lot. In high-growth businesses, you don't have the luxury of taking 2, 3, 4, or 5 years to develop somebody. When we doubled from $18 million to $35 million, some people got left behind. It sucks. It hurts. I didn't want to be that guy.
Patrick Baldwin: Above being afraid of being left behind, did you have to turn to self-development? Was it more than Doug or an outside coach to say, “I've got to keep up with this growing machine.”
David Billingsly: I don't like reading but leaders are readers, so thank God for Audible. I've tried to listen to as many books as I can. Vistage was a good resource for me on that. You can get the shiny object squirrel disease like, “I read this book. We're changing everything.” There is some caution to that. The four books, The Energy Bus is a corny little stupid book but it's about being positive about things. Byron said, “You just got a smile and you're going to get through it every day,” in his last episode.
The Power of Positive Thinking. Good to Great is an amazing book. It's getting the right people on the bus. Measure What Matters is around OKRs but ultimately, what KPIs are you measuring in your business? The ultimate question is around NPS and being true to yourself. I give those four books to people because I'm like, “This is what I'm all about. You take these four books and blend them together. I think that you can be an effective leader off of those.” You should continue to read, develop, and be open-minded about things. In addition to the coach, you’ve got to be willing to do some work.
Paul Giannamore: What are you reading or listening to now?
David Billingsly: I'm listening to Servant Leadership. I've got queues in my Audible account of stuff that I've got teed up.
Paul Giannamore: Do you ever have so many books in your Audible that are unread and you feel like a loser and you're like, “I got this huge stack.” It’s peering back at you.
David Billingsly: All the time.
Patrick Baldwin: I thought it was just me.
David Billingsly: It's everyone.
Patrick Baldwin: The plane right here, I was like, “I've got three.” I rotate it between the three.
David Billingsly: Because you're running this business and you're on all the time, sometimes I like good Trainwreck TV or Real Housewives, whatever. Call me what you want to call me. I know the Mex is going to pounce all over this, but good Trainwreck TV occasionally to be able to turn your brain off.
Paul Giannamore: I'm watching Bridgerton.
David Billingsly: We love it.
Paul Giannamore: I like it a lot.
David Billingsly: That's quasi-healthy because of all the time that you're doing these things. You’ve got to work hard. I try to get up every morning. I've got a list of positive affirmations. I'm a big believer in self-talk.
Paul Giannamore: I know you're a believer in dirty talk, not a believer in self-talk. It works.
David Billingsly: Dirty talk, foul mouth. There's a difference.
Patrick Baldwin: You call them L2 and L3. You're more entry-level future leaders in the business. How do you figure out who they are?
David Billingsly: The CEO, president, main leader, and owner of a business would be your L1s. L2s report to that person. L3s, next level down. Depending on how many layers you have in the business, 5s, 6s, whatever that is. I want to focus on our direct reports. My direct reports are people who report directly to me and then those leaders from there.
How are you finding those additional leaders? I said this at Bubble Trouble, “Your best technician always makes your best next manager.” How many people have made that mistake? You figure you would do it once and never do it again. The problem is growth and capacity issues continue to force our hands as operators that you're like, “I got a guy that has twenty technicians and he's completely ineffective. Grab Sam and have him need 4 or 5 of these guys because he's a good technician.”
In order to begin to start looking at your bench and your depth on your bench, how are you identifying the people that are even interested? Getting a business coach is one thing, but that leader has to be willing to put in the work to change. Some technicians just want to be technicians for the rest of their lives. That's great. We need that as part of our business. There's nothing wrong with that.
You also have some folks that have additional ambition, whatever they want to be, but if they want more out of that, how do you give them an opportunity and a vehicle for them to stick their hand up? Because most are not going to walk into the CEO's office and say, “David, I want to be the next president here after I replace you.” Most people are not going to do that. How are you giving your team an opportunity to stick their hand up and say, “I'm interested in being developed in some way, shape, or form.” That's where that emerging leader's program came from.
Patrick Baldwin: I heard you say ambition. Maybe you have to dumb it down and simplify it for me. Is there a single character trait that you're looking for?
David Billingsly: Positive mental attitude. If somebody is positive and they're not coming in, and then they're not bitching and complaining all the time and they're positive about being at work and positive about interacting with their teammates, if you've got a positive attitude, there's hope with me. I will work my ass off to help that person get ahead. If you've got a shitty attitude, I'm going to work my ass off to publicly execute you as soon as possible.
Patrick Baldwin: I'm going to ask for free coaching or counseling right now. If you're not the majority shareholder, then there's always a threat of a future leader coming up and replacing you. Do you just have to deal with it and suck it up? How do you not overtrain your future replacement?
David Billingsly: Leaders that are scared of somebody replacing them, are you a leader? Some of the best coaches, if you look at Bill Belichick or Mike Holmgren or Vince Lombardi, take Bill Belichick, how many head coaches does he have in the league now?
Paul Giannamore: Five. That was a guess. I have no idea.
David Billingsly: I was impressed because that was a confident five.
David Billingsly: He has multiple head coaches and that's the holy grail for me. Kevin Poland earned that job at American. He did all the work for that. The fact that there was this young man that started at American and I somehow helped Kevin get there and he's there, that for me is the holy grail. If a leader within an organization is repressing people because they don't want them to pass them, you don't have a good leader in that place in my opinion.
Smaller businesses, $2 million, $3 million business, you've got the owner there and a few technicians. How do you deal with that? I don't know. If you want to continue to be at $2 million, then the owner probably needs some type of coaching in business training. All the other technicians well are just going to be technicians if that's the way you want to run that.
By the way, I've seen tons of $2 million businesses and I've seen the homes that these owners live in and the cash it throws off. What a great lifestyle business. Paul, you've seen this 1,000 times. If you're going to run a business like that, you have to understand what's going to happen from a technician standpoint. You're either going to have a decent amount of turnover so you need to be ready for that or what I found more often is the owners continue to overpay said technicians. Said technicians usually are not held accountable and are usually going to hold you hostage at some point in time. Generally speaking, once it gets to that point, they're picking up the phone and calling Paul saying, “I’m done. This sucks. I’ll sell my business.”
Patrick Baldwin: That was a tough question for me to ask and even stomach.
David Billingsly: You asked it pretty easily.
Patrick Baldwin: I only ask the hard questions. As you're identifying and you're equipping future leaders, does competition come along? Is that part of it also? “We're going to put these people against each other vying for the next position.”
David Billingsly: That probably naturally happens. I haven't ever thought about vying for two individuals. I'm not the kind of guy that invites two people to dinner and says, “Either of you two was going to get the job by the end of the night.” I have no idea who’d do something crazy like that.
Paul Giannamore: It was lunch.
David Billingsly: “This guy did it.”
Paul Giannamore: I did it. That's how I hired the Mexican. I narrowed it down to two people and then I independently invited them to lunch. When they sat down, I said, “One of you is getting this job. Go.”
Patrick Baldwin: You did okay?
David Billingsly: He's got the Mex.
Paul Giannamore: The Mex was a result of that experiment.
Patrick Baldwin: Do you have regrets?
Paul Giannamore: No.
David Billingsly: Have you ever seen an MTV Deathmatch? That's what Paul created.
Paul Giannamore: That's what it was. That's how we got the Mex.
David Billingsly: Patrick is like, “I learned something new today.”
Paul Giannamore: You wouldn't do that.
David Billingsly: I don't think on purpose. Naturally, you want to create some stuff. When you have openings, you're throwing out those openings within the organization or at least you probably should be, depending on your size. Inevitably, people are going to apply for it and you're going to do those interviews. Hopefully, you can select the best candidate. Inevitably, somebody's going to get their feelings hurt.
What I do think is a good idea though is, let's say you're going to hire a new service manager and three technicians apply for it, which is great. They're all great technicians. You end up hiring Sam. What do you do with the other two guys or gals? Do you just say, “You didn't get the job,” or do you bring them in and maybe spend 10 or 15 minutes saying, “I appreciate you coming in and interviewing for this. By the way, I know we went a different direction and you're probably disappointed you didn't get the gig.” Maybe they are and maybe they're not. Probably they’re like, “Thank God I didn't get the job.”
Paul Giannamore: “I was on probation. They made me do it.”
David Billingsly: “You should maybe work on these few things.” I'll throw a guy a book. “What can I work on, David?” “The first thing you can do is read this.”
Paul Giannamore: What book would you throw at him?
David Billingsly: One of those four books for sure. If you throw him a book and then they don't do anything with it, there's your answer. By showing people that you care, you're trying to create this culture. Lots of competition, huge wage inflation. I used to always tell our technicians, “If you want to make more money, you can go work for Terminix and Orkin in our market. You'll go make more money.” We at least care about you here. We're not perfect. We're going to screw stuff up, but if it's just about money, then you should go somewhere else.”
Patrick Baldwin: Did you ever think you're training your future competitor? It’s hard to compete against American.
David Billingsly: Impossible. We’re better than everybody else.
Patrick Baldwin: You're equipping them.
Paul Giannamore: It’s gotten easier over the years now that David's departed.
Patrick Baldwin: Did you equip your future? Were you not stigmatizing future competition?
David Billingsly: Have people leave and go to the competition?
Patrick Baldwin: Start their own business.
David Billingsly: If you want to start your own business and you think it's that easy, go ahead.
Patrick Baldwin: You've talked about staking.
Paul Giannamore: Let's say you got a great team member and the team member wants to go out and do it on his own. Instead of being a bastard about it, stake the guy, partner with them, and help them. At the end of the day, the way that I look at it is, there's so much business to go around. I feel like what I do over here, if I can bring the industry up, my M&A niche, then I'm benefiting everyone. I'm creating more value for everyone.
That same thing in any business. What you were talking about is a leader developing leaders. The greatest compliment a leader can get is a younger generation to surpass them. You've done what you're supposed to do. There are a lot of opportunities out there. I see a lot of successful business people not worrying about technicians, leaving, and starting their own businesses. In fact, supporting it.
Quite frankly, a lot of business owners worry about their technicians leaving and starting a business. Nine out of ten of these guys are going to fail because they don't realize what it's like to make payroll and seasonality. They see the owner who's got a big house, who's built this business, but they forget the 50 years of risks that were taken. I say have at it. Try it.
David Billingsly: “You want to start your business? Got it.”
Paul Giannamore: This is the United States of America.
David Billingsly: “Do it. Just don't mess with our customers for the first year. We have a set of standard non-solicitation. Leave my team members alone for the first year and then go. It’s good, healthy competition. If you think it's that easy, absolutely go ahead.” It isn’t easy.
Paul Giannamore: Everyone in the industry can relate to the guy that left, tried to start his own business, six months later calls up the boss and says, “Can I come back?”
David Billingsly: I've never been the owner. It's different. As an operator that has grown these businesses, I control what I can control. I choose to have the most positive attitude that I possibly can and not let some of this stuff get in the way. Because when you focus on that, that's when you take your eye off of what's the most important thing. What are the things that are the most important for your business? Focus on those things and ignore all the other minutia. If you focus on these things, people being one of them, you're going to win. People get distracted and go down these rabbit holes like, “I can't understand why I can't grow my business.”
Patrick Baldwin: On the P&L, how much did you see investing in your future leaders, like, “I'm going to put this much into this person and this much into this person.”
David Billingsly: I never so much looked at it that way. It's going to depend on how successful your business is. It takes money to be able to do these things so you've got to make sure that you're focusing on the right things. Maybe 0.5% of revenue. If you had a $3 million business and you paid somebody $1,000 a month to coach one of your service managers, that's $12,000 a year. Paul, you're the analytical guy. What percent of revenue is that? Half a percent?
Paul Giannamore: I can't do math.
David Billingsly: In the long scheme of things, if you've got a leader that is interested in getting better, you’ve got to want to. It's like a marriage. You guys both need to work at it and want to be married. It's with that. It can be a minor investment. There are guys out there, people, folks that do these things. There are tons of consultants out there as well that do those things.
Paul Giannamore: It's 100% on the desire part. In our internal meeting here with Ericka and her team, one of the discussions we had was that they wanted to do some development, not only for their career but leadership and all sorts of things. They said, “What can we do?” I said, “Tell me exactly what you want to do. Go out and do research for external resources that can help you accomplish your goals, lay it all out, and come to me and say, “We want you to write a check for this. This is what we want to do and why we want to do it.” I write the check. It took a month or two. They went out to research stuff and that was it. They came to me and said, “This is our proposal.” Now they own it.
David Billingsly: We would do Excel training for folks and we got something out of it.
Paul Giannamore: Ricky Bobby did Excel training. I remember he was so excited about that.
David Billingsly: Number one, I had Jen Blondo that for her, it was like, “I get to do Excel training.” You need a special person to do Excel training. You didn't have to do it. You take Jolene who is my executive assistant at American. She started in the call center and then was brave enough to come work with me and help me. What a saint. She's an amazing person.
Paul Giannamore: Quite fun for her.
David Billingsly: To have to deal with me. She wanted to be more than just the “secretary”.
Paul Giannamore: Didn’t the Mexican a collar secretary and you slugged him in the face?
David Billingsly: Yeah, because she’s not. Jolene was part of our leadership team in American. I made it the point, like, “She's not here to take your coffee orders. She's here because she has a voice.” Number one, by edifying her in front of the entire leadership team and letting everybody know that I have her back. The other part of that is she also took the initiative on her own to follow up with Jen, like, “I need a little bit more help here,” or she would go online and she'd take an online course around PowerPoint or whatever.
That's the kind of stuff. You ask, “What are you looking for?” What's ambition look like? Ambition looks like, “It's not just my job to be able to do some of these things.” What else are you doing outside of your time with me to develop yourself if you're serious about it? When you start finding those people that are taking classes on the side and they're paying for them out of their own pocket because they don't want Sam to get the job. They want the job next time because you gave them that feedback. Can you imagine having 100 of those on your team?
Paul Giannamore: No, I can't.
Patrick Baldwin: Where did you go from just one-on-one Doug coaching you? It sounds like you've ended up developing your own in-house training. Was that a certain revenue, a certain number of employees are like, “We need to do this on a massive scale.”
David Billingsly: When I got the keys of the kingdom in 2017 at American, Doug quickly kicked me out of the nest and said, “It's time for you to go to full-blown CEO, Vistage,” which I did. It was through that more so seeing some of what my peers were doing within their group, then bringing in a few speakers, Alex being one of them. Once a month, he and I get together over a glass of wine. He owned his own wine distributing business for a while. It was cool. We go break bread and have a bottle of wine and BS about stuff.
As we began to talk more about things, that's when he and I put our heads together and we're like, “We can do more.” At the time, I had my senior leadership team, which were most of my direct reports. We formed this thing called a Greater Team. The Greater Team was all the other managers. It was the senior leadership team and all the managers. When we formed it, there were 30-ish of those managers. Quarterly basis, we'd get together. Usually, we would do it at the office. We'd bring food in. I would do a quarterly state of the company with all of our managers saying, “This is what's going on. Here are our initiatives. Here's what we're working on. By the way, what questions do you have for me?”
We’re getting feedback quarterly, by the way, pulse surveys. We do these surveys on a regular basis and getting feedback from our team members. We realized, “If we're going to continue to grow at the rate we're going to, we don't have the time to develop team members in a slower fashion. How can we speed this up?” We developed a formal program with a curriculum that we could roll out. Year after year, we keep pounding through that to identify new leaders, emerging leaders, and then to continue to develop existing leaders and give them the necessary tools for them to be successful.
Patrick Baldwin: You've had the ability to peek into a lot of other businesses, at least the Anticimex, the whole East Coast. Did you ever look at a business that had something built on an American?
David Billingsly: No.
Patrick Baldwin: I’m not trying to toot your own horn.
David Billingsly: I appreciate that. Not that I have had the peek inside of the Sprague business but I've known the Sprague guys for a long time through Copesan and the new head guy there, Ross. Years ago, Sprague developed a program where they got serious and spent some money on a leadership development program. In my opinion, Sprague was probably the best in class and they still are. It's almost like Sprague University. You have to apply for it. They go through.
Sprague has done an amazing job with that. I know Ross. He's a good friend. There's not a ton out there. I've peeked out a lot of businesses over the last few years. I said it on Bubble Trouble and I’ll say it again. There is a significant void in our industry for mid-level management training. For whatever reason, we seem to have blinders on. What's the definition of insanity?
Patrick Baldwin: Keep doing the same thing.
David Billingsly: Over and over again and expecting different results. For some reason within the industry, we keep doing the same thing over and over again, expecting different results. There's a significant opportunity to do some of these things with mid-level management.
Patrick Baldwin: I love the idea and stuck with me, that $0.50 or that $1 an hour where someone's leaving you over such a minimal difference in pay and that you have the ability to come in and develop them as a person and develop your culture, the camaraderie, and the future business.
David Billingsly: In DC, the government area, you'd have people apply for government jobs. They'd come in and I'd be like, “I'd love to keep you but I also understand there's not a whole lot I can do. I'm not going to pay you $25 an hour.” Now, that's a regular wage. At the time, my tech was making $15 or $16 an hour and he'd be like, “I'll stay if you can give me $25.” I'd be like, “You need to go. This is an amazing opportunity.” If folks are leaving you for $0.50 or $1, you need to have a long, hard look in the mirror. People have left me for $0.50 or $1, so I've had some long, hard looks in the mirror. What are you going to do about it?
Patrick Baldwin: What did you do?
David Billingsly: We adapted, we changed, we listened to our team members, and we developed programs to let them know that we care about them. It doesn't always work. The ones that leave when you're providing that, I don't want them on my team anyways. What I want to do is have positive-mental-attitude people with can-do attitudes that wanted to be there and were teachable and trainable.
Those people that love the service business, that wanted to take great care of our clients, and were great team members and cared about their team members are the ones that I wanted there. The other ones, let them go. Next. It's tough to do that today, by the way. It's easy for me to say that. I'm unemployed, everybody. You have to go out there and execute now. I am very passionate about that. I’m super opinionated about it. I can be right or wrong. It was wrong once then I realized I was right.
Paul Giannamore: What's your pant leg length?
David Billingsly: On a good day, 28.5 or maybe 29 inches. If I got my boots on, maybe it's a little longer.
Paul Giannamore: The pickings are slim at the old rack.
David Billingsly: Lululemon is a little expensive. My wife would laugh about this. At Brooks Brothers, quick story. Tailored clothing, men's suits, all that stuff. Back in the day, you could find nothing with less than a 30-inch inseam. I'm not a 30-inch inseam. Maybe 31, but 30, 32, 33, 34. They got a new collection of pants. She was not my wife at the time. Just good friends. She's in another store in downtown DC. She and one of our other good friends called me up laughing because they got pants that was a 29-inch inseam and they were going to call it the David Billingsly collection. When you're a little person or an Oompa Loompa or whatever you want to call little people like me, the struggle is real. Lululemon has 28s, which was a little bit short on me. At 29, it's right on the money.
Paul Giannamore: What you were talking about on Jarl’s episode when you were in Stockholm, those guys are tall.
David Billingsly: They're tall and thin. That was funny. I love clothing. I love fabrics. I love to go into haberdasheries wherever I'm at and touch and feel the material. My wife and I are walking the streets of Stockholm and we see a few of these haberdasheries. We go in and my wife's like, “You should try something on.” I was probably a 44 reg at the time or whatever. I grabbed the equivalent, which is about 56 European centimeters. I tried to put it on. It was like Chris Farley trying to fit into a jacket. The armholes are super slim. It was ridiculous. The saleslady came over and she said, “Too much lasagna.” I bought the only thing I could there. I bought three pairs of socks. You’d be a good fit for that stuff.
Paul Giannamore: I hit 50 and I'm staying right at 50. I'm not going 49. I’m not going to 52.
David Billingsly: You're right that 40-ish reg.
Paul Giannamore: I don't know what it is in the US. Probably something around there.
David Billingsly: You look good. You've lost some weight.
Paul Giannamore: I’m staying at 50.
David Billingsly: Patrick, maybe not so much. I thought you were done. I retired and dumbed down fifteen pounds. I’m super focused on getting out.
Patrick Baldwin: It was steroids that got me here.
Paul Giannamore: I've done the whole tailored suit thing but now I'm trying to get the perfect weight for me and doing everything I can to stay there. I can't eat the last fry because it's going to tip me over the edge. I’m cutting it off.
David Billingsly: Made-to-measure. I'm in Vegas now so there's some super good stuff. You had a good year in 2021 so you could afford it. You can go into Zegna inevitably. There's probably Loro Piana.
Paul Giannamore: That's my shoes.
David Billingsly: Loro Piana makes some great fabrications. I worked for a brief little stint called Tom James for almost a year. I would go to your office. You would be my perfect client.
Paul Giannamore: You want lazy?
David Billingsly: You're a busy professional. I'd come to the office and I'd take your measurements. I'd have a bunch of fabrics and you'd pick from them. I'd be like, “Paul, what do you like? Do you like a three-button? Do you like a two-button?” My favorite is a two-button, peak lapel, side-meant ticket pocket jacket. It's a freaking beautiful jacket. We'd make that up for you.
I'd sell you some shirts and then I'd bring them to the office. You try a few things on and we’d do another fitting. Make sure everything's perfect. You want functional buttonholes where they button and we put your name in it, big swinging Paul Giannamore in his jacket. You bring that in. If I do a good job, number one, twice a year you're going to invite me back because I'm going to call you and tell you I got new stuff.
The other is you're going to tell all the partners in your office because they're going to be like, “Paul, that's a smoking suit,” and you're going to be like, “This guy Billingsly came in.” All of a sudden, you get into a law firm, or PriceCoopers was downtown at the time, huge clients, and now you're in. Tom James is still around. I know you like Singapore. You can go there and you're going to have a suit made in two days.
Paul Giannamore: Do you still spend a lot of time toiling around the clothing industry? Is that still an interest of yours?
David Billingsly: Does it look like I spend much time? The pink jacket killed.
Paul Giannamore: You’ve been pink-themed. Was Jim saying you guys look at Easter eggs?
David Billingsly: I was channeling my inner Glenn Matthews, a good friend of mine, Modern pest control. Shout out, South Carolina.
Paul Giannamore: He's pretty in pink or what?
David Billingsly: Glenn wears some crazy crap but he looks good. Phil Gregory, best dressed man in pest control. Every time you see Phil dressed to the nine, I would always go up and pat him on the back, not because I wanted to pat him on the back but because I want to feel the fabric.
Paul Giannamore: You touched his material.
David Billingsly: He knew I came from the business. We used to always talk about clothes.
Paul Giannamore: Was it always the jacket or shirt?
David Billingsly: It was always the shoulder of the jacket, Paul.
Paul Giannamore: Just making sure.
David Billingsly: It's like the Friends episode, “What do you mean that's how they measure you? My tailor always measured me for that.” Completely feeling violated.
Patrick Baldwin: I've never heard someone, other than Kevin Byrne, said he was the best-dressed man in pest control.
David Billingsly: Phil Gregory. I still love clothes.
Paul Giannamore: If we know who the best is, we must know who the worst is.
David Billingsly: For clothes in the industry? There are so many of those.
Paul Giannamore: There are a lot of people fighting for that title.
David Billingsly: I feel like I'm in the South. It's like, “Bless your heart.” Belt with suspenders, don't be that guy.
Paul Giannamore: I was in PestEx in London and of course, everyone's there in suits and stuff, then you go to an NPMA event and it's like, “Holy crap.”
David Billingsly: People were like, “Brooks Brothers? Pest control?” Bottom line is that it's a service business. It’s people.
Paul Giannamore: There have been a lot of changes all around here in the industry. We have the Rentokil-Terminix pending merger. I was surprised when Jarl stepped down as CEO. I was shocked at that announcement. I was shocked when you called me and said, “I'm going to be out at AX.” Then I was further shocked when Brian Alexson said he's moved on to be the CEO of another business outside of pest control. What are your thoughts on some of the commotions?
David Billingsly: The Jarl transitioning from him being the CEO to chairman of the board.
Paul Giannamore: I forgot to mention Ola.
David Billingsly: Ola’s last day was the 28th.
Paul Giannamore: Same as yours.
David Billingsly: We had the exit. The recap from fund six into this long-haul fund, there's no doubt that some of us did okay. Like any other transition, it's probably going to slow things down a little bit. You've got new leadership. We had Vinje who crushed it here for five years, and then you bring in a new leader with Brian. Brian's not Mikael, not worse, not better, not whatever. It's just different. As leaders, you've got to adjust for that.
There was some adjustment time for that. Now that Brian has stepped away, we'll see what happens here. At the same time, you've got one of the most important areas for Anticimex, which is the US. You've got a new CEO who I have not met. He came from Ericsson and he’s a Swede. You've got new leadership at Anticimex, which is all I've ever known is the blond beast.
You've got Staffan. He's there. You're going to have new leadership here in the US. I'm not sure what that looks like. You've got new leadership out west. The bottom line is, whenever you have leadership changes, it's not necessarily a bad thing but there's going to be some type of transition and the train has to slow. It will slow things down.
Paul Giannamore: I've had two conversations with the new CEO, Staffan, since he's joined. He comes from Ericsson. The conversations that I had with him were very technical. He's into the whole electronic digital smart thing. We’re probably going to see a lot of focus put on that. Talent is interim now. Is there a chance we could do a cage match to see who ultimately becomes president? Put Fat Jim in the ring with somebody.
David Billingsly: I spent a few days with Jim and my money's on Jimmy. He's a New Yorker. He's not going to fight fair. “That's not a fair fight.” There's no such thing as a fair fight. It's going to be different. I love Bill Talon. He’s a great leader and so is the interim. I told Bill this a while ago, I was like, “I'd follow you in a battle all day long.” We'll see what that looks like over here.
Paul Giannamore: I think very highly of Bill Talon. He's demonstrated he's got the metal. At least the announcement that I saw, it's interim. It's like, “Brian's gone. We need to put somebody in place.” Bill clearly made sense for that. The question now is if it'll stick.
David Billingsly: What's next? They're going to have to figure that out. The nice thing about Anticimex is it’s a global organization. Australia's cranking finally again. You got Singapore and it's doing well. The leader in Europe has done a good job, Thomas Hilde, stabilizing the European platforms and getting those profitable. That one first deal was ISS. They've done good with that. The Nordic businesses are doing fine.
If the US slows down a little bit, you've got the rest of the world that's still cranking pretty decently. As a grand scheme of things for Anticimex, I don't see it affecting things a whole lot. The US is probably going to be a little bit of an anchor until we get this figured out. We had rapid growth. Vinje was the leader for five years. You guys know Vinje. All the other brokers knew Vinje. Everybody knew what to expect from that organization because we take on that characteristic.
We were going more centralized and now it's more decentralized. Whenever that happens, it's going to slow things down. My feeling is things are going to slow down a little bit, which isn't necessarily a bad thing. They've got some pretty aggressive five-year goals that they've got to meet. The wise man said, “We'll see.”
Paul Giannamore: Now that you're out, I know that we have some mutual clients. You're doing some fantastic consulting work for folks. Companies are calling you to sit you down for interviews. If you push all that noise aside and say what David Billingsly, the man, sees for the next conceivably twenty years of your working life, what excites you? Is it owning a business? Is it building a consulting business? Is it joining a private equity firm? There are a million things you could do. Do you have any ideas?
David Billingsly: I've been doing a lot of thinking about that. I've been an employee for over 35 years. I started working when I was 13.
Paul Giannamore: Not always a good one either.
David Billingsly: I got some other stories we can share on the X-rated Buzz.
Paul Giannamore: What else will we have on the X-rated Buzz?
David Billingsly: What's on the horizon for David? I've told Karen and we agreed, “For 60 or 90 days, we're not going to make a whole ton of decisions.” I needed to take some time off, which I'm doing well needed. That being said, if there was ever a time for David Billingsly to do something for David Billingsly, now would probably be the best time in my life to ever do it. I still have a bunch of gas in the tank, but I also don't want to work for the rest of my life.
My son is back in the Virginia Beach area. He's an accountant and he's well on his way. His girlfriend, probably soon to be fiancé, is in medical school. I check the box on that. He's killing life right now so I couldn't be more proud of him. I've worked my ass off. Let's face it, when you work hard, you have a high-stress job, which I was in, there's no doubt that I trimmed some years off of my life. I was okay doing that because it was my responsibility to take care of Karen, Andrew, and my family. I gladly traded those years.
If there's a way for me to get some of that back, life's short. You never know what's going to be around the corner. I probably want to stick my head up and smell the roses a little bit. I still have a lot to offer to the industry. I feel like I could bring a lot of value to folks. I'll probably go down the consulting gig for a little while and stay relevant and see what I can do to help people. I’m a big sports guy. I had always wanted to coach. I'm not going to coach football or sports anymore. I feel like I can bring the same energy and passion to be a coach in business and be able to help people, and take those experiences that I've had. I got a PhD with Anticimex.
Paul Giannamore: At least the University of Stockholm.
David Billingsly: I think that I can bring a lot of value. I don't know where that leads. If I find the right situation to be working with somebody that I want to work with, I could see that but it's going to have to be the right situation.
Paul Giannamore: What's the characteristic of a business that you could provide value to or that would benefit from what it is that you bring to the table?
David Billingsly: First and foremost, you’ve got to want to. You either have to be an owner that's open-minded to take advice from somebody else. If you're looking at the L2s, level 2s, level 3s, and mid-level management, do you have folks that want to get better? A few years ago, when you asked me this, I'd be like, “I was at American when we were $4 million and I'm here to $13 million, $15 million. I know how to go on that journey. I've done that.” It's like this business degree.
All of a sudden, I've been part of something in a rapidly growing environment and saw what kind of turmoil that can cause. I've stepped on the landmines there. I know some of the things that are going to blow things up. I know some of the things that I look back on and say, “We should have done this differently.”
Part of that is leadership development that I'm talking about. I wish we would have done that sooner. We were doing something about it. Whether you're $1 million or $2 million, you've got a business that’s a lifestyle business but maybe you want to step away and turn it over to somebody else, I could certainly help in that area. Whether you're a $100 million business and you want a fresh eye for somebody to come in for a few days and maybe poke holes in some of the things you’re doing. A lot of owners aren't open-minded to that. They don't want somebody coming in sniffing around and telling them what they're doing wrong.
Paul Giannamore: The problem with almost all small businesses around the world is that 99% of the time, the actual owner shouldn't be running the business. When I look across the pest control industry, if I pick 100 companies, at least 95 of those owners should not be running their business if their goal is to create value and grow a big business. It’s not suited. They don't have the experience and the background expertise, education, and so on.
The majority of them don't realize that. Some of them do and some of them call up and say, “I've had this discussion. I shouldn't be running this. I want to have a lot of money. I know I'm not the quickest way to get there.” What would you say to somebody, if I called you up and I said, “David, I got a $5 million business. I'm doing everything. I've got a bench here but I need your help. I don't know where to go. I don't know what to do. I don't know how to grow this anymore.” What would that look like? Will you come in and sit down with me? Do you start with my aspirations?
David Billingsly: I probably come in and want to get to know you and get to know more about the business a little bit. I'm going to want to take a look at the financials. What's the financial health of the business? What do gross margins look like? How are you doing routing? What are you doing about employee appreciation? What are you doing about leadership development? All of those things.
From there, what do you want? Do you want to be able to step away and have somebody else take it over? Do you want to stay super involved in this? It's going to depend. It's almost like deals. There's not going to be any cookie-cutter way to do this. It's going to depend on that owner on exactly what his aspirations are.
“I want to take this thing from $5 million to $10 million next year so I can sell it.” “Let's talk about that a little bit. You got 100% growth on $5 million. Great. What do you have in place?” “I've got some residential sales inspectors.” “We're probably not going to do $10 million in the first year. Let's talk about getting some things in place so we can accelerate growth. What are those expectations?” “It's got to be $10 million.” “You should probably call somebody else because I'm probably not your guy.”
Paul Giannamore: Let's say I own a $3 million pest control business. Let's say it's a quality business. I'm half-decent at my job, but I don't want to toil in the pest control vineyards every day. How realistic is it for me, the owner, to find somebody else that could be the CEO and manage that business? Am I too small to find somebody that could be a good steward of that business?
David Billingsly: Depends on what you want to spend. I've been blown away by some of these smaller businesses on these kinds of second lieutenant guys that have run this business, good quality operators, but they're going to command a good chunk of change. It depends. Can you find folks? They are out there. Guys like Kevin Poland, David Billingsly, and the Paul Bergmanns of the world, there are folks out there that are amazing operators and good leaders that want to do a good job and help business.
Paul Giannamore: They're running bigger businesses. Kevin's running American. I’m just saying to get somebody to come into a $3 million business. Have you seen that?
David Billingsly: Yeah. We've acquired a few businesses. It's crazy what these guys were paying these guys. It'll cost you but if you can hold my calls and send my check, the challenge is most owners that own a $3 million business probably aren't going to just hire a guy like David Billingsly out of the blue, with no background and give you the keys to their business and walk away from it. Matt and I had years together.
Paul Giannamore: You grew up in the business, so to speak.
David Billingsly: It's not impossible. It's a tough task. If that's what you want to do, it doesn't mean you can't do it. It's a little harder to find. Unicorns do exist. They're just hard to find.
Paul Giannamore: After a couple of more years, we might see some. David, it’s awesome having you down here this week. For everyone out there, we're going to have the biocide of M&A series kickoff. You're the inaugural episode so I appreciate that. David will give us a very high-level look at strategy and operations when you start thinking about doing biocide M&A.
David Billingsly: Thanks for having me out, guys. Anytime, I’m always willing to come to Puerto Rico.
David Billingsly - LinkedIn
episode 24 - Stockholm Sessions 2: Anticimex President & CEO Jarl Dahlfors
Bubble Trouble – past episode
American
Vistage
Copesan
NPMA
The Energy Bus
The Power of Positive Thinking
Good to Great
Measure What Matters
Servant Leadership
Anticimex
Sprague
Loro Piana
Modern
PestEx
