Gary Findley: My biggest red flag could be two things, a person that's way too needy and a person that's not needy at all.
Paul Giannamore: Patrick, after a little bit of a summer hiatus, the Boardroom Buzz is back in full swing.
Patrick Baldwin: We're back, Paul.
Paul Giannamore: We are back and we're going to do something a little bit different. As many of you know, I've had the opportunity to get to know Seth Garber from Pest Daily. He was a guest on the Buzz. Patrick, one of the reasons why we're a little bit slow is we're in Q3 and I have been traveling a ton. I've had a lot of people down here in Puerto Rico. We had six private equity firms throughout the island. I haven't been able to make my recording sessions and I thought to myself, “I should phone a friend.” I did. I found Seth Garber and he accepted our invitation to join The Boardroom Buzz as a co-host. Welcome, Seth.
Seth Garber: Thanks a lot. I'm super excited to be doing this. It's going to be a blast.
Patrick Baldwin: Welcome, Seth. Setty G, can I do that? It’s like Kenny G.
Seth Garber: If we're going to start out with nicknames that quick, we might get back to Fat Pat.
Paul Giannamore: We had an interview, Seth, and I had a great time with it because our interview guest referred to Patrick as Fat Pat.
Patrick Baldwin: Where’s the love? Why do I succumb to this? I choose to be here.
Paul Giannamore: Seth, we're going to have a chit-chat about an interview that I could not attend. As a matter of fact, that's not true. I attended the first interview but we had tech complications. For the first time, not our fault. Patrick went ahead and did a one-on-one interview live in person. Let's talk about that a little bit, Patrick.
Patrick Baldwin: It was right here. It's convenient. Gary Findley. The biggest thing I can think of in his career is he built Curves. If you think back, the women's franchise, it's been around for a while. He was there in its heyday. When I think about franchising, he's definitely on the top of the list of people that have done well and know a lot about it. We hear franchising questions all the time, at least I do. Do you all here franchise this and franchise that?
Seth Garber: If I had to give the top ten things people talk about, it's probably in the top ten. This company has reached out and they want to franchise their brand. They have all these big ideas and big things they want to do. We hear about it a ton.
Patrick Baldwin: I heard there's a case study of franchising Fat Pest.
Paul Giannamore: It's going to happen. Somebody sent in a federal trademark application on Fat Pest. We've been monitoring that, Pat. Now that I call you Fat Pat, you've lost the rick at the end of your name. Now you're just pat.
Patrick Baldwin: We're going way back.
Paul Giannamore: I’d never do that to you. I'll say that in front of the audience. Never call him Pat. Fat Pat is okay, Patrick's preferred. Pat, no way. In the discussion with Gary, the franchising part was interesting to me but this guy's claim to fame is much more than just Curves, Patrick. He is a home services entrepreneur. What else has he got going on?
Patrick Baldwin: Stellar Brands was this service business that they built. It came out of Florida, down Seth Garber’s land. Restoration 1 business, of course. They also tapped into plumbing with bluefrog Plumbing. We'll get into as far as what took off there. They got into the service business. It was great to hear both his experience in the fitness industry he’s been in a long time and also now where real work happens.
Paul Giannamore: He also is an Undercover Boss, was he not?
Patrick Baldwin: He was on Undercover Boss. His book also came out, The Redneck CEO. I know Gary Findley. That's my claim to fame.
Seth Garber: I'm excited about hearing about the interview. A fun fact is that when I was a kid, the first gym I ever went to was at Curves. My mom was a Curves member and I snuck in with her. It made me get a little tear in my eye when I heard you say that. It reminded me of that day. Pretty funny stuff.
Patrick Baldwin: I got a tear in my eye too, Seth.
Paul Giannamore: Are you still going to Curves, Seth? You do talk about going to the gym. You never gave that up?
Seth Garber: If I told my wife I was going to go to Curves, I’d probably have to keep it secret. You’ll never know. She might not be super happy about that. I'm happy to go check out Curves.
Patrick Baldwin: I'm thinking about when we worked out with your trainer there in Tampa. That torturous morning, that was definitely not Curves.
Seth Garber: No. That was an interesting day there, Fat Pat. You got a chance to see what it looks like getting a workout at 5:30 or 6:00 AM down here.
Patrick Baldwin: I appreciate it. You're such a good host.
Seth Garber: We've been making those invites to everybody else that travels down here. You're 1 of only 2 people it's ever accepted.
Patrick Baldwin: I did not throw up so I'm proud. Seth, since you're the new host, I'll give you the honors. Why don't you cue us into this? Do your thing.
Seth Garber: Let's step into the Boardroom with Gary Findley. Let's go, Paul.
Paul Giannamore: Let's do this, Seth.
Patrick Baldwin: This is a treat. Gary Findley, we got you in the Boardroom. I'm excited. Paul and I have talked about this interview. This is a redo. If there’s such a thing as a small role, we've lived it when we first recorded this thing.
Gary Findley: It seems like we've been on the road going somewhere.
Patrick Baldwin: I'll tell you what, you put the redneck in The Redneck CEO. Your dial-up when you were at the trailer park recording our last episode, there must have been duct tape on that antenna.
Gary Findley: I needed to go out there and adjust the antennas. I got foil on the end of them. I told you, guys.
Patrick Baldwin: It was fun. We definitely need to redo this. Paul wishes he could be here. He's got a couple of closings. It’s exciting, at least for him. Firstly, about the small world, do you remember the day after we recorded that thing? I'm sitting down with Carrol Fitzgerald at Brown House Cafe.
Gary Findley: I walked in. I know him. You were doing the same thing.
Patrick Baldwin: I was like, “Is that Gary Findley?” We just met the day before. We lived in Waco since ‘05.
Gary Findley: Let's point out the most obvious, you live next door to my mom and dad. You and I have never met. We do the podcast. It doesn't work. I see you the next day at breakfast.
Patrick Baldwin: Now I get to hang out with your son a lot.
Gary Findley: My mom sits at that window. She probably saw me get out and come in here. She may be knocking on your door in a little bit.
Patrick Baldwin: We just moved in. This interview had already been in the works before then. Down the street, they said, “This is Mr. and Mrs. Findley’s house.” I was like, “No kidding.”
Gary Findley: If you recall, I told you that my dad walks up to me one day and goes, “The guy next door said he's going to be interviewing you.” I go, “The guy next door? Why would he be interviewing me? I don't think so.” He starts to give me the name and everything and he says, “I had your book in his hand and he said, “Are you Gary Findley’s dad? Have you read the book?” My dad looks at you and goes, “I didn't know he wrote a book.”
Patrick Baldwin: Surprise.
Gary Findley: You blew that one for me. It was going to be a birthday present.
Patrick Baldwin: You talk a lot about your dad in this book, which is heartwarming. You’ve done business together. We're going to talk about that. Let's talk about franchising because it's a hot topic. I hear it all the time, “I've got this up-and-coming pest control business. I know everything about pest control. I can take my brand and my systems. I'm going to take over the world because everyone's gonna fall in love with the XYZ brand. I'm going to show them how to do it.”
Gary Findley: Of course, everybody thinks that. I used to say that not every idea is a good franchise and not every franchise is a good idea. I have people all the time who still call me up, “I got this idea. Talk about coffee.” I got a kid in Stephenville who says, “We got this idea. We get this best coffee. How do we franchise that?”
For probably over 35 years now, I've perfected that somewhat. I've represented about a dozen brands, some of them are startups, some of them were up and going, and we help promote and build them from there. Anything from dog daycares to kids’ cooking schools to kids’ fitness centers to chocolate fondue from Brazil, it's been a little bit of everything. For me, it’s knowing what to look for, where you build from there, and what they need next. It's all about the systems and processes.
I started franchising in probably 1982, shortly after Kim and I got married. With Neighborly here in town, back then it was a Dwyer Group, I got my toes wet in the franchising world. My dad was an entrepreneur. Looking at how people take a business and open it without having to go through all the heartaches of trial and error, that's what a franchise is. That franchise gives you the playbook. That's great if you follow the playbook. Some people don't read directions well. The businesses, you have the good, the bad, and the ugly.
When somebody says, “I want to start something,” it's got to have something different that they can't get anywhere. A buddy of mine approached me about Curves in 1996. He came up and said, “I got an idea.” He and I had been acquaintances in the fitness industry for years prior. He said, “I got these two women's fitness centers open, one in Harlingen and one in McAllen.” He was down in south Texas.
He said, “They're a good idea. I know nothing about franchising.” Oddly enough, I had a background in both fitness and franchising. I went out and looked at him and said, “It's a good idea.” I come back home and tell Kim, “This guy wants me to help him. He's got no money. He can't pay me anything but it's a good idea.” 30 or 45 days earlier, we would file bankruptcy.
We lost my health club at Baylor due to Baylor opening their own facility. I bought that on sweat equity. When you don't have a pocket full of cash, it makes it tough. We had this niche in Small Town America, towns with 5,000 people in them. I started with him as a sales guy. I grew into the president after about a year and was president for the next seven years growing that from those two locations to over 8,000 locations in 30 countries. It was a whirlwind. Right place and the right time.
Patrick Baldwin: That's incredible. That was Gary Heavin. That was Curves. I'm pointing this way. It’s five minutes. It's the little city on the hill. You've been out of Curves for a bit now. It’s sold and all that.
Gary Findley: I've been at it long enough. We drive up the hill here and we have the headquarters. My emotions are good. I have great memories of it. Everybody gets to a place where they think, “I've done as much for this as I can do.” That's where I got that eighth year. With a close friend of mine, we designed and built that building. It was funny, I said, “Here are the plans. What do you think?” He says, “I got two things, pay cash for it and make sure my office is bigger than your office.” He didn't even have an office in our other office for the entire time we were growing, for the most part, maybe within the last year. He lived out of town.
He said, “This is yours to run. You run it.” Gary was involved in the back end of that, the building, the operational pieces, and brainstorming on new ideas and things. I finished that building. I finished the training center first. It was 16,000 square feet. I then finished the headquarters, 3 floors, 45,000 square feet, and beautiful conference rooms with big fireplaces. It's still the prettiest nice place in Waco. It has big decks around it.
One of the things was I could step out on the deck from my office and look down and see my house. My house, I'm building it in the back. It wasn't a front. I could see my house. When we were building it, I'm in there one day and I hear this noise. I look out there and Gary's landing on the tee box in his helicopter to get out and come see my house. I felt a lot of pride for it. We did some great things. They have been a little bit of a downslope for the last several years. Things change, time changes, and people change what they're looking for in a health club. I felt great pride in what we built there. One of the best jobs I've ever had, the best eight years of my life.
Patrick Baldwin: Going way back to 1982, you're working for the Dwyer Group. That would have been Don Dwyer Sr. I've heard Waco is referenced as the second mecca of franchising. We take it for granted. The first thing is Minneapolis if I'm not mistaken.
Gary Findley: Minneapolis is the first. People don't know in this town the things that have come out and the businesses are coming out here. Don started with SMI, which is Paul Myers’ company. He learned a lot of great things there and he took it and tweaked it and started Rainbow International, which is the first company. I was selling franchises there. I was 22 years old. By that time, we already had at least two kids.
He was a great mentor for a kid who was 22 years old. We'd work late at night and go up there and sit in his office at 9:00 PM and listen to him talk about franchising and how he got into it. He’d spend time with me to get me excited. He was a guy that was one of the best at what he did. It was a great experience that got me that start in franchising right here in Waco. I kept it in Waco. Even what I do today with Restoration 1, I moved the headquarters from Florida to here. Some other ones have started here but are always based out of here. This is my home.
Patrick Baldwin: It's something we do take for granted. This is a real treat to have this conversation. Reading The Redneck CEO, there’s a lot of Waco business history here. It put a lot of pieces together that I've heard over time. You've lived and experienced it.
Gary Findley: I lived here my whole life. I was born outside of Waco in a little town called Axtell. I had 23 people in my graduating class and I married one of them. On September 4th, 2022, we’d be 40 years. I started dating her in my junior year. I love this town, everything about it. It's exactly what you would think it would be. We've grown a lot since Chip and Joanna. I've seen gains in the last two years more than I've seen last twenty years.
Patrick Baldwin: Are you talking about property taxes?
Gary Findley: I'm talking about property values. One helps the other. There's a balance there. I loved everything about the little town I grew up in, Axtell. I knew everybody on every street. I was related to somebody on every street. Nowhere else in the world could you ride a horse to school. I worked on ranches and farms. My dad was a deacon in the church there. My dad was a trustee. My dad was on the school board. My dad was on the water board. He knew everything that was going on. He was well respected.
It's a great way to grow up. I was in a Christian home. I knew not just those values, the Christian values, but the moral values of the way that my mom and dad treated people. Axtell was a little bit of a poor town. A lot of working people are out of blue-collar. My dad coached baseball and he took a lot of time with the kids. It was a great place to be raised.
Patrick Baldwin: It’ll be a real treat when you tell Paul where you used to haunt growing up. Axtell formerly has a famous resident.
Gary Findley: Maybe he’s still there. Branch Davidians, David Koresh. Who knows with him? That was our unclaimed fame for years. Fortunately, Chip and Joanna came along and Curves. We took over the bad and replaced it with the good.
Patrick Baldwin: Thank goodness. Thank you.
Gary Findley: No kidding. Take a good time.
Patrick Baldwin: Franchising comes up a lot. If I remember right, there's licensing and franchising. Sometimes there's some confusion there. It's funny. Jeff Burchfield is someone we've talked about on the podcast before going way back. He helped us set up the franchise. He was the general counsel at Curves after your departure there.
Gary Findley: I know him.
Patrick Baldwin: A great guy. If I remember, there's a three-legged stool test when it comes to franchising. If someone's thinking about, “I want to do a franchise,” what is that one that says, “Is it better to go with licensing? Is it better to go with franchising? Maybe neither?”
Gary Findley: Licensing, in reality, all they're doing is, “Here's our name. Here's what we're about. Pay us a license fee and good luck.” It’s not the depth of the franchise. A franchise is an ongoing operational experience, guidance, support, and those things. You're paying a monthly royalty to do that. User licensing is a one-time fee.
I used to own a powerhouse gym and that’s all it was. It was a license. They gave me a license. I could buy their products and those kinds of things. On an annual license fee, that's the extent of it. If they've got something going on good and people says, “I want to open one,” some people will start with a license and eventually turn it into a franchise. They usually know ahead of time. If you're collecting those royalties, you’re a franchise. You have a license.
Patrick Baldwin: In Undercover Boss, you wouldn't buy Bobby, my business partner in 855Bugs. Bobby and I franchised that business in 2015. We had Chuck Williams. He helped us franchise. You knew Chuck. He passed over two years ago now.
Gary Findley: My wife worked at SMI when we got married. I know all the guys that had been involved for years.
Patrick Baldwin: We franchised the pest control business. We got to ten units. We let it dwindle. A lot of it goes to support. The thing going into it being a pest control business and a pest control franchise is it's like a horse of a different color. It might be 5%. That whole business was pest control. When your franchisee calls and says, “I'm struggling with this bug,” or, “ I need help selling termites.” The rest of it is not pest control. When it comes to being a franchisor and making that decision, what does that business model look like?
Gary Findley: There is a point to where you're going to get it as a franchisor to where it's no longer about what that business offers. It is about being a franchise company and all the things that we talked about like the support and everything behind it. For me, the different thing is that I franchise. Once we had the steps down of what makes a successful franchise, there are a lot of things involved in that. All the little buckets, we knew what to do, we could roll that out, and then it's just changing. Whether it's pest, restoration, plumbing, or AC, you plug this into this whole package. That works over and over again.
Those are all the how-tos and how-not to do, what you should be doing and what you should not be doing. It's been about making sure that those things were done well. That firsthand 20 or 30 locations are dependent upon the franchisor. After that, it gets a growth. Now they've got a network of people they can talk to. You've been through so many things at that point that it becomes second nature. You're always learning but it becomes second nature at that point.
Patrick Baldwin: It's almost like plug and play. In some industries, there's no barrier to entry like Restoration. There's no licensing. There's equipment. You could open up a restoration business tomorrow.
Gary Findley: You need training and support. For our plumbing, bluefrog Plumbing, you have to have a license. It makes it a harder sell.
Patrick Baldwin: Tell me about that? That's what I want to know.
Gary Findley: Even in the state of Texas, you can't just go get a license. You're going to be in an apprenticeship for 1 or 2 years. It’s like a real estate lesson. We help them find a master licensee, a master plumber. They're going to work underneath them. Any barrier to that where you've got to have some certificate or some type of schooling slows the sales process down. If you go back and you look at the growth that I’ve had, that growth has been in something where there was no barrier. People will find out that it's worth the time and effort.
In the plumbing business, there are two things about it. There are three great margins. You're always going to need it. It didn't go anywhere during COVID and neither did Restoration. If your toilet backs up, if your house floods, it's got to be done. You can't wait. Those are getting into that great industry. That's why I love the service business. I've been in brick-and-mortar. In the service business, low barrier of entry, high margins, and no brick-and-mortar, which is one of my favorites, and having that low investment to get in. I like those things now. There was a day when brick-and-mortar was all I ever did.
Most of the time, you look at something under $100,000 to get started and it ramps up quick. In Restoration specifically, you don't necessarily have to hit first and be spending a lot of time in marketing to get your name out there because it doesn't happen all the time. It's not like you're going to have a flood in your house every day. It is providing good service and word of mouth. If you start looking at some of our big competitors, you'll see them on TV during hurricane season. That's all the large loss stuff. That's not your everyday. Your everyday stuff is what drives the business.
Patrick Baldwin: I look back and second guess. They were learning opportunities. They weren't mistakes. I’m now thinking about franchising. The listeners call and we’ll chat or email and all that. I talk to the listeners and they say, “I'm thinking about franchising.” I'm like, “Hold on. Let's talk through it. What are you looking to accomplish that way?”
Looking back, one of the difficulties was maybe who we targeted as far as prospects for franchising. We're going to talk a little about partnerships. I think about partnerships being almost like a marriage. That's a serious commitment. When it comes to franchising, I don't know if there's a good analogy there but who is a good franchisee both in terms of prospecting the future and the support?
Gary Findley: There is no perfect way of finding them. I have found that over 30 years, there's not. That perfect person is someone who has the drive to get out there and do the business. The main thing is that they're a good listener. They're going to listen to you because you've been there and done that. They're going to follow the support that you have. They're going to follow the plan that you have. There are people. Take the military. Military people are used to following that. They got a great hard work ethic. Those are great.
There's a little bit of difference. Our work is blue-collar. That's what you would think. You think, “I’m going to people to come out of blue-collar jobs.” Restoration 1 is a lot. It can be corporate executives. It can be people with professional backgrounds. The reason is that they know how to run a successful business. They know how to watch the margins. They know how to hire people. They know how to train people. They know how to follow a process because they came from a company that did that and they were successful. That's the success you find in our business today. It's funny, it is that.
When I went out with Undercover Boss, half of those were owned by veterans and you could see it, especially the one in Virginia, that franchise owner. You pull up and all their people are wearing their clothes. Their vans are clean. That's the model franchisee. They're not always that way. I would tell you, there's no perfect way to find them. If you figure that out, you've got it made. You don't ever have to work again.
There's a midpoint between slinging something against the wall and seeing what sticks. It's not always money. Sometimes the people with the most money, they got a lot of money so they can walk away easier. There's the guy who’s got enough money and getting it saved up in a 401. They don't want to lose that. They've got a great work ethic. They come from a company that has taught them how to build a business. That is for us. That's the best one. It wasn't the health club business. The worst owners I had came from the health club background. They’re like, “I don't do fitness that way. I do it this way.” The others come to learn and that's what you're looking for.
Patrick Baldwin: What red flags did you experience? Would you say, “This is not a good franchisee.” They might already be the system, “There's some things that I'm not so sure about this guy.”
Gary Findley: Conversions is what you alluded to earlier. If you're in a business like pest control, plumbing, or even restoration, you may go your way of building that business to be through acquisitions or conversions of getting some authority in that business to switch over. That one has its challenges. They're going to pay you for something that they've been doing they haven't had to pay and they go, “I've already got the experience. I know how to do it this way.”
My biggest red flag could be two things, a person that's way too needy and a person that's not needy at all. The person that is not needy is not calling you, not contacting you, not coming to the conferences, and not coming to conventions. They're doing it their own way. You're going to see that over time. Some of them can get successful with that but that's not what you're looking for. That person that's too needy and calls you about every single thing, a lot of times, they think they're buying a franchise for you to run the business for them. They think, “They're going to come and do this for me.” That's their expectation.
We do always make sure on the front end of that when people came in for training, no matter what company I had, here are the expectations. You talked about marriage a while ago. I've said this forever, franchising is like marriage. We're not always going to get along. We're not always going to be happy. At the end of the day, we're working together to resolve things and build a better future. It's not always rainbows and butterflies.
Patrick Baldwin: I'm thinking about what you wrote in the book. I admire it. Back in the early days of Curves, you were pitching this trailer with equipment. The equipment arrives. It's all banged up on this beat-up old trailer. You got the spray paint out. That was determination. You turn around and you'd be selling franchises like memberships the next day.
Gary Findley: I would go out to town running ads. One time out of all the 50 times I did it, only once did I have two people answer the ad. Most of the time, one. I went and met with one person. I call it the rifle approach. In Texas, one riot and one ranger. It was that rifle approach. I got one person to meet with and I'm driving all the way to Durango, Colorado, Grand Junction, Rio Rancho, New Mexico, and making this little circle with my family in the car.
I went in and I got this two-page worst brochure you've ever seen in your life. I come up and I've got that brochure in my hand. We don't have any clubs open to speak of that they can go look at or talk to. It was 100% sales for the 50 that I sold, the first 50 before I took over as president. I would come back to Waco, drop the kids off, drive down south, which is another six hours and load up equipment.
You mentioned this raggedy trailer that I thought would never make it back to Colorado. I would come back, pick up the kids, go there, drop it off, set it up, and stay there. 100 memberships or breakeven. I had to stay there. It usually took me sometimes 2 or 4 days to get them to 100 members that would take off.
The next town has already run their ads. Now they're opening the same thing. I’m on my way back. I'd been running ads to sell another franchise. I would stop, meet with that next person, and sell that one. It's like a rat running on this wheel doing it. It worked over and over again. We had great franchises. We're in Small Town America. We didn't have any competitors.
Probably my most memorable trip, and I put it in the book, was early on, I was taking all these trips and not with the family. I was taking out equipment. It was Canyon City, Colorado. I got up that morning and had stomach flu. I can't make it a couple of minutes without running in the restroom. I’m sick to my stomach. This is Saturday afternoon and they're opening on Monday. It might have been Sunday morning but they're opening on Monday. They've already run their ad. They've already got members coming. The finished ad is ready. I called Gary and go, “I can't do this.” Gary said, “There is nobody. There's me and you.” I said, “Okay.”
I took off down the highway and 30 miles or something, I pulled out, got out, rest a little bit, get back in, and take off. Finally, about maybe 5 or 6 hours into the day, after doing this, I was exhausted like I've never been in my life. I pulled in and got a hotel. I slept for about three hours. I got up and did it all over again. I got there about before the sun came up. I took all the equipment out and set it on the front until they got there. I laid it up against one of them. I fell asleep. I woke up. I was looking at the mountains and wondering where I was.
Mid-day, I was fine. Everything's going. It's one of those building the business that you do what you have to do. That was the early days. I wouldn't exchange it for anything. I look at that as fun. Maybe at the moment, it didn't but that was the start of something big. It ended up being one of the fastest-growing franchises in the world. It was good times, good friends, great owners, and wonderful people.
Patrick Baldwin: What was that? You worked one by one. Maybe on a weekly basis, a new franchise, and a new club open. You get the 100 members and you're on to the next one. You're selling one. You got to 8,000 units. Was there a tipping point where it began to multiply beyond control almost?
Gary Findley: That first one was 100. When you get that first little 100, now you start getting a little bit of exposure. By the time we got there, I had probably thirteen sales guys, all commission-only. Eat-what-you-kill-guys, my dad being one of them.
Patrick Baldwin: Number one salesman next door.
Gary Findley: They got out and took the process. The same with franchising, which was running ads in a small town. Back then, everybody had a little small-town newspaper. They had different states. My dad covered Colorado, New Mexico, Oklahoma, and parts of Texas. They followed that process. By that time, I got thirteen guys doing this all the time. If you had 1,000 locations, you're up at the top of the lead at that point, especially in the early ‘90s.
Before we hit 5,000, we were one of those things where we're opening 300 a month. That one year, we opened over 3,000 locations. Well-oiled machine. We got a great guy to build our equipment and deliver the equipment. I was not involved on the operational side. We had people that were in that. We have about 300 mentors that we had across the country that would go out and do openings. We always had somebody there for an opening.
Patrick Baldwin: You're at the top of the franchise world. You're looking to the left and the right. You probably got McDonald's on one side and Subway on the other and Dwyer group. I can't think who else had that many units back then.
Gary Findley: Back then, the Dwyer Group wasn't that big. We did 1,000 locations with Rainbow. I'm guessing. If you took all of them together and that Neighborly Brand, I don't know what that number looks like. Back then, Curves was quite a bit way further than that. They might have been at a couple of 1,000 back at that time. McDonald's has been around a lot longer but there were some new startups and Curves would have been right in that mix.
Patrick Baldwin: You went from fitness even before franchising. You had a business with your dad, a fitness business. Was that the power?
Gary Findley: No. This was before that. It was an all men's health club here in Waco. That was the first one we did together. A swimming pool, running track, sauna, steam, the sides, laundry, and all men. It was a country club. The guy that started it had 4 or 5 of them across Texas. He lands his helicopter in the parking lot one day. That’s the first time I ever met him. He gets out and the guy is about 6’5”. At that point, I'm 19 years old. He ends up having to file for bankruptcy. He's spending way more than he's making.
I was going around Texas helping do openings and pre-sales for memberships. I ended up taking over managing that club. When he went bankrupt, my dad helped me buy that out of bankruptcy. That's how I got started. Oddly, that guy ended up being a billionaire. The last time I saw him, he was broke. He's almost like the made-off. He started a Ponzi. He was knighted over in Antigua. He had planes and helicopters. The American Greed. A guy named Allen Stanford. He was a big deal. He's still in prison now.
Patrick Baldwin: It all caught up to him. You saw the warning signs a long time ago.
Gary Findley: I knew how much money he was coming in even by watching it. You can take a guess, even at 19 years old, between Jaguars, helicopters, and planes, he wasn't going to last long. He wasn’t making that much money.
Patrick Baldwin: You end up in Curves and then the service industry. Is it very similar or not similar as far as the industry goes?
Gary Findley: Not even close. I spent five years in Minnesota as the COO of another fitness franchise. I came back and I started this niche for doing development for new concepts or emerging concepts. The fitness business is brick and mortar. Some of it is customer service maybe but the franchisee was different. Selling fitness is sexy. Selling plumbing and restoration, there's nothing sexy about it. Nobody wants to go home and tell their neighbor, “I bought a plumbing franchise.” What they don't know about it is the money that you can make in the plumbing and restoration business.
You asked about owners, those are the people that understand that. It's one of those things where it's not necessarily the avenue or the venue for what they want to do. They say it's a good business model. I did that. That was based in Florida. I moved the headquarters here and then started the headquarters. I hired Mike and my son and his best friend. They're the ones that built out the operations of the company.
I'm a developer. Matter of fact, I don't have the desire to be involved in operations. We brought twenty locations over. We were at a point where we needed to grow. They built it all. They put the systems, the processes, the training, and the software, and took that thing from 22 to close to 200 over the next 3.5 years.
Patrick Baldwin: Thinking back, you had the Findley Group at some point.
Gary Findley: It was after Curves and before the Minnesota trip.
Patrick Baldwin: It was almost an incubator of sorts, wasn't it? You could take a concept and see if it had some traction.
Gary Findley: Our buddy would come to me. In that case, a friend of mine came and knew about Young Chefs. Facelogic was one that was birthed by 2 or 3 ladies that were Curves franchisees. There were some that we helped develop that are local here. Dogtopia, I worked with the owners of that and building that. I worked for a short time with Bahama Buck’s. We took a chocolate fondue called Showcolate from Brazil. They were very successful. It’s a little taco kiosk. It goes in malls. We have launched them. We had stuff that we helped launch. I helped the guy do a kid's fitness center called Young Champions. A lot of different stuff.
Patrick Baldwin: If someone comes to you with a concept today, “Gary, I want to start this business.” What questions are running through your head as they approach you with a new idea?
Gary Findley: It needs to be a proven concept. A proven concept doesn't necessarily mean you went down Yelp, a hamburger joint down the road, and everybody loves it. We have one up the road up here in a gas station.
Patrick Baldwin: Harris Creek Burgers.
Gary Findley: Great and wonderful burgers. That doesn't mean it's a proven concept. Proven means that after you've built it and you've done well, you then have to put the processes, you've reinvented it, and you put it somewhere else. I like to see a few locations and not all in the same city. Sometimes it's just a fluke. Sometimes it is geographical. Showcolate was a great example. That was chocolate and that was fruit. Chocolate fondue put on fruit. It went gangbusters in Brazil. In Brazil, people go to malls. That's what they do, they eat healthier. They do eat a lot of fruit.
As Americans, when we go to malls, we’re looking for a pretzel, cookies, or comfort food. You're not even thinking about health, like, “I can get some fruit and put some chocolate on it.” A geographical thing. For me, can you do it? They don't have to have $1 million but they have to be funded enough to build a business. The last thing you want to do is go out and build something and sell 10 franchises and not be able to support them. That's the problem.
Patrick Baldwin: Is the concept itself further down on that ladder? You're looking at the founder of financing.
Gary Findley: I think so. It'd be hard today to find a concept that's different than anything else. There's home insulation. There’s probably a commercial too that started up. He's doing well but that's not the first one. In this case, yes. To me, the concept comes later.
Patrick Baldwin: You've had a series of ups and downs and highs and lows. Are there certain mantras? It’s the character your mom and dad instilled in you. The work ethic and grit, you had even in high school. I'd read about it. Curves, high. Minnesota is not so high. What gets you through that?
Gary Findley: The only thing that gets you through that stuff is faith. My Christian faith got me through that. I don't think about it. I go, “That one didn't work. Let's go to the next one.” For me, it’s that trust that God's got a plan. Keep following it and keep your eyes looking forward to that and the next thing will be there. Those times have happened. My kids are smart. They have time to sit around and dwell on it and think about it. There's a reason for that season in your life and you don't know what it is.
My dad was never down. I never saw my dad mumble about business being bad or when it didn't work out. He got beat up on some things as well, business partnerships, but I never saw him dwell on it. He did the next thing. Whether it was to have a candy route and go out and fill grocery stores or convenience stores with peanut patties, pralines, or pickles, that's what he did. He was always scrambling to make money.
Patrick Baldwin: You mentioned partnerships. Bobby was my partner at Bugs. We’re about to start a new business. I have a partner getting into that business. What advice do you have when it comes to partnerships? What to look for in a partner? Should you get a partner?
Gary Findley: I've seen very few of them work. I've seen a few work less when it comes to family partnerships. If you put family or longtime friends, it puts a strain on everything. I'm having this conversation driving in with a guy. He was talking about this guy who runs a store. He’s got a coffee shop. His in-laws own it and they were going to sell it. They said, “You got to work and eventually, we'll sell it to you.” It then became very successful. Now they're trying to figure that out.
I said, “The only way you can do that is a very clear and precise plan. This is what's going to happen. If this happens, this is how we're going to handle it. You’ll never vary from that.” Clarity going into it. That's what happens with a lot of partnerships. People know each other and go, “We're best friends. This is going to work just fine.” They don't bring that up. In reality, the more money you make, the worse the problem becomes. If you’re losing any money, there's not.
Patrick Baldwin: The irony. You and Gary Heavin, though. That's one that you look back on. You'd do it all over again.
Gary Findley: Gary was not always about money. Gary said, “Instead of giving away 10%, I'm going to do this backward. I'm giving away 90% and live on 10%.” He did that a long time. Gary didn't have any big needs. He loved airplanes. He's a pilot. That's his hobby. He's been blessed with the opportunity to do that.
Gary lived life to the fullest and still does. It wasn't about the money to him. He made a commitment to me sitting on the floor of the garage putting machines together when we started Curves and said, “If you do this and you get ready to leave one day, I'll give you 10% of the value of the company.” I don't think we shook hands. I shooked my head. We didn't shake hands. We just kept going and thinking, “If it's good, it's good. If it didn’t work, no big deal.” It just blew up.
The way Gary had my salary set up, it became an obscene amount of money, yearly what I was making. Never in any time did Gary ever look at that and say, “Let's cut this back. Let's do that.” When I got ready to leave, I walked in, sat in his house in the living room with him and Diane, and said, “It's time. The company is worth this. I’ll write you a check for this.” It wasn't a small number. It’s $10 million.
He said, “That's what we need to discuss.” I didn't think twice. It's exactly what you told me. A man of honor. I’d do that all over. Not everyone is that way. If I had experienced it in another way that had it all in writing and a deal and took five years and moved to Minnesota, that did not come out the way it's supposed to be.
Patrick Baldwin: M&A and franchising, I want to hit both aspects real quick. M&A, as a franchisor, what exit opportunities are there? If someone ends up growing this, is there a certain number of units that they need to build to or certain revenue before the interest comes from private equity or strategic buyers? Neighborly comes knocking and says, “We want to add this concept.” What does that look like for a franchisor?
Gary Findley: Back in the day, I knew nothing about private equity, nothing about these acquisitions, and nothing about M&A. I hadn't heard it till I got into the company in Minnesota. What happened was, when I had Findley Group, I was on the cover of a magazine called Franchise Times. This is the oversized magazine if you're in franchising. I'm on the cover there. I got a picture of me and my horse. The inside was a spread. This thing covered 2 or 3 pages. No one was doing that at that time, which was representing multiple brands. It was a new phenomenon. I did that.
Within two weeks, I got a call from half a dozen large PE companies and said, “We want to get into franchising. We want you to help us do it.” I flew out and met with all of them. I met one in California that went on to buy Planet Fitness. They were a large company. They got along well, those guys. They said, “Go find us something.” I made a few calls and ended up finding this company in Minnesota that was going on the market at that moment.
We went out and Matt did the pitch. They did not get the deal but one of the other large PE companies did get it. When I got back home, the owner of the company called me and said, “It was great meeting you. I took this deal with Summit partners but I'd like you to be on my new board.” I went out for that board meeting. He decided he wanted to take to it internationally. He needed help. He needed franchise experience so I went on board to do that.
I spent time learning more about how this works. There are lots of opportunities but I have found there's private equity, which could be institutional money. There is family money, which is what we've done today, your family, friends, and private investors. I like that. There's not as much monitoring and they trust you to run the business. You're not always sitting around filling out reports. It's not 100% true. They do give you a little more latitude to that.
For me, I was going to say services but I've seen a lot of things happening in the fitness industry. Since I've done this, even understanding private equity, starting in ’08, I’ve never seen the opportunities there are now today. You'll get their attention when you've got 50 or 60 locations. That's when they'll start looking. At the end of the day, you have ten locations and it makes twice as much money as somebody with 50. It is the industry.
Service is the hottest industry out there today because that COVID brought them to it. You’ll notice that the service industry didn't shut down. There are lots and lots of opportunities. I’ve probably been contacted by a dozen. We weren't even for sale when we sold. The same thing, I started having calls and ended up getting four people that are interested in it. We sat down, talked with them, and ended up selecting NPK. To me, one of the best opportunities I've seen in my career has been what's going on today.
Patrick Baldwin: What about in terms of the franchisee? If I'm going to get into business, what's my exit? What's that asset I'm building over time? It's funny. When I flew out to Florida, I was sitting next to a State Farm rep and he was talking about when State Farm owned that book of business. They don't own that asset. With an all-state rep, they're like, “You’d grow that book of business as an asset. You own that.” I'm like, “These are two very different business models.” In franchising, what does that look like? Who owns those customers in the franchises that you've been involved in?
Gary Findley: As a franchisee, their only real exit is to sell their business. That's it. They can't wake up one day, five years in. I had somebody try it, “We built this business. It's all of our hard work. We don't need you anymore.” They forget that they didn't know anything about what they were doing when they came in. It should be your hard work. I brought the concept, the idea, the experience, and the system. You bring your hard work and money to invest. We're going to do this together. We're partners.
People that want to get out of it, other than selling, there's no other way to get out of it other than, “I'm not happy anymore.” At least in my career, most of those have been other franchisees that ended up buying a location because they're looking to expand. It’s not an option to wake up and decide you don't want to do it anymore.
There are terms on the agreement, some are 5, 10, or 20. At the end of that, you can get out. You can say, “I don't want to do this anymore,” but you're still going to be bound to non-compete for a couple of years. I spent all this time teaching you how to run this business so I don't want you to wake up one morning and decide you don't want to do it. Now you go take all the ideas I gave you and went and did it yourself.
Patrick Baldwin: If I understand it right, the franchisee has the ability to go and find someone else to take over their territory, take over their book of business. There should be some value there assuming they're running a profitable business. They might pay the franchisor some transfer fee or something small like $500,000. You've got some paperwork on your end to get with the new franchisee and then they can walk away with some non-compete. At least there's an exit. Is that a good conversation to have up front as a potential franchisee comes to you as the franchisor and says, “What happens in 5, 10, or 15 years when I want to go do something different or exit?”
Gary Findley: You have that but not a lot. Franchising has been around so long. They understand it's not something somebody can teach you. With the company that we have now, that conversation does come up because they're doing well. Those who are, are the ones who typically don't put the effort into it. That's not something that comes up, at least not on my career.
Patrick Baldwin: What is next for Gary? You sold Stellar Brands to NBK, that family-friendly, private equity-ish. I know the P stands for Pro. There's money there.
Gary Findley: I continue to help as I can. I moved as chairman of the board. I don't have any day-to-day operations anymore, which is exactly the way. That's where I wanted to be. That gives me time like I had yesterday day to go take my grandson and go caddy for him in a golf tournament and spend time with the ranch, which we sold. What's next? I’m still getting calls from people if I can help. I don't necessarily need to help things to build another company but to advise as I can. Probably it’s my family and to find the ministry that I'm passionate about and get involved in headfirst. That's my plan.
Patrick Baldwin: $1 million question, is there more franchising in the future for Gary Findley?
Gary Findley: No. Probably for helping my kids or helping others but not for me personally.
Patrick Baldwin: I'll hold you to it. I'll be watching.
Gary Findley: You won't see my name as an owner.
Patrick Baldwin: Now the CBS star of Undercover Boss, author of The Redneck CEO, and a successful business person. I feel like I've met a new friend. Gary, thanks for coming to The Boardroom Buzz.
Gary Findley: You bet. I'm glad we're able to do this in your studio and not have to chase down a signal. This will come out better. I appreciate the opportunity. You weren't hard to find. I can't leave here without going next door and seeing my mom. I know she saw me come in here and she’s going to see me come out. Thanks a lot. I appreciate it. Thanks for the time.
Patrick Baldwin: Thanks, Gary.
Patrick Baldwin: I was glad to have Gary step into the real, in-person, and one on one Boardroom. I was like, “I've only had one person come into my home office here and it happen to be Gary.” Seth, when we were talking about this interview, one of the things that you said stuck out to you was franchising and licensing. I still can't wrap around my head all the ins and outs of what's the difference but it's something that you get hit up with.
Seth Garber: I found Gary's perspective interesting. One of the things that we're constantly hearing is, “I want to franchise my business.” Gary hit the nail on the head when he talked about the idea of what's the difference between licensing and franchise. A lot of the guys that are thinking they want to be a franchise is that they want to be licensing companies in our industry.
I get a chance to work with a lot of the large franchise companies in the industry. The reality is there's a lot of work that goes on on the back end and a lot of support that these guys have to do. For some of the companies that we talk with, it seems like licensing might be a better way to go than franchising for a lot of them, Patrick.
Patrick Baldwin: I hear you. I'm thinking way back. Selling chemical products requiring that of a franchisee was one thing as far as passing the test. In pest control, I don’t think that's a necessity to do. The margins are so small as it is. It's very small. Can either of you think of a properly licensed company that operates that's not a franchise?
Seth Garber: What a great question.
Paul Giannamore: What do you mean by a properly licensed company?
Patrick Baldwin: Is there a pest control company that operates through licensing? Here's my brand but you're not necessarily a franchisee.
Paul Giannamore: Yes.
Patrick Baldwin: There are a lot of hoops to go through franchising.
Paul Giannamore: Let's use Fat Pat’s Pest Control. Pat is down in Texas. As Fat Pat, you're running a Waco business. Let's say that I'm in Missouri and instead of franchising it to me, you can license the name and you can license various processes. We see it a lot in door-to-door, by the way. There are a lot of key sales guys that’ll steak some money and allow them to license the service mark, trademarks, and those things. We do see that. It's not extremely prolific but I see it from time to time.
Seth Garber: I was trying to think of some examples. Paul, I agree with you. The only place I see it is the door-to-door space. I was trying to think back to other companies. I've seen companies attempt it where they have done a good job of branding and then they'll sell a license to another company in a different market in the same state. You see that a lot in Florida but it tends to not work out. Gary even touched on it within the podcast. Interesting.
Paul Giannamore: We've done that, by the way. We've sold businesses before to some of the large players and they have licensed certain aspects of the business. We have done that. There are some pest control businesses out there in the wild that are owned by 1 of the big 3 that are licensed situations.
Patrick Baldwin: I want to ask you, Paul. What complications are there whether it's licensing or franchising? When it comes time to sell, how does that affect the process?
Paul Giannamore: It's interesting, Patrick. Before the three of us got on here, I was talking to somebody who's a mutual client of Seth’s firm as well as ours. We were having discussions about licensing, about where intellectual property should be held, and about how the agreement should be drafted. I'm not an attorney but I was walking through some of the layman considerations that you would have ultimately when you try to sell it. Of course, I got him connected with Mike Stanczyk to think about shareholder agreements and license agreements.
Licensing is flexible. We'll go back to Fat Pat. You're in Texas. Let's say that you've got a colleague who runs a business in Maryland and he wants to be able to leverage the name. Let's say you've got a wicked cool design. You've got a great website. He wants to be able to utilize some of the capabilities that you have, maybe to the extent of using back office functions. Maybe using a call center. It becomes a licensed relationship. You could do a joint venture company. You could do shared ownership of an LLC, for example. You could skip all that and sign a license agreement.
Where it becomes an issue is that a lot of times, like everything in life, when people set up partnerships, sometimes they don't document ownership. They don’t document all these sorts of things. It’s the same thing with licensing. If you're going to allow somebody else to use your trademarks, your operating procedures, and all of these things, a proper license agreement should be drafted so that the property owner has property rights in that.
One of the big problems that folks have both on the franchise as well as the licensing side is you run a business, it's a licensed name. Now you want to sell it. Rentokil is going to buy it from you. The use of that name is terminated immediately. I've seen that, for example, with Truly Nolen. All of a sudden, you can't use the name Truly Nolen. The customers have to be switched over almost immediately, which could impair the value of the business. There are some complicated issues involving that and some complexities that need to be negotiated upfront. You shouldn't wait until the end when you're trying to affect a transaction to do that.
Patrick Baldwin: Seth and I were chatting about franchising in M&A as far as his experience. One of the things that came up was the first right of refusal with that particular concept. How does that impact the process that you would take someone through if there's a first right of refusal in their franchise agreement?
Paul Giannamore: Most franchise agreements do have that right of first refusal. There are some interesting case studies in pest and lawn for ROFRs, right of first refusals, in franchise agreements. One of the problems with franchising is you go out and build up a business. I've seen this with things like Mosquito Squad. Somebody will build a $10 million franchise.
When it comes time to exit, you've invested all this money, time, effort, and years to build up this franchise. You can't turn around and sell that to Terminix. You have to sell it to an individual, for example. An individual has neither the capacity to pay like Terminix does nor can they create as much value as a big strategic acquirer. You're limiting your acquisition universe when you franchise.
Franchisors will put in a right of first refusal. Irrespective of who the buyer is, the franchisor will say, “Within X number of days of accepting an offer, you have to come to us.” Typically, we see a 30 to 60-day period. They have 30 to 60 days to match that offer. Otherwise, they can affirmatively decline it and say, “Go ahead with the sale.” Depending on how the franchising agreements are structured, I've seen franchise agreements where the franchisor owns the rights to those customers. The franchisee doesn't even own that. There are just a lot of complications.
One of the Terminix franchisees, over 30 some odd years ago, edited the right of first refusal within the license agreement. Terminex has big franchises. There are three of them in the Carolinas doing roughly 300 million in customer revenue. There's a big one down in Louisiana and there are 25 other ones in the country. Terminix refers to those as license agreements as opposed to franchises. In effect, they are franchises.
Over 35 years ago, one of the shareholders of one of the franchisees was renewing the franchise agreement. He put a clause in there that said, “Terminix, you can have the right of first refusal. If you end up trumping an offer that I have, if you end up exercising your right of first refusal, you have to pay the offerer a breakup fee,” or what was referred to as a termination fee.
How this works in practice is, Patrick, you want to buy one of these franchises. You've done a lot of work. Let's say it's a $50 million deal. You're about to write a check for $50 million. You don't want to do a ton of work if a franchisor has a right of first refusal. Most likely, Terminix is not going to let you buy it. Within that agreement, if Terminix does affirmatively execute the right of first refusal, they have to turn around and pay you a fee and the fee has to be large enough to make it worth your trouble.
I have seen that and that's a way for a franchisee to put himself in a position where he makes it worth the while for competitive buyers to come in if for no other purpose to have Terminix or the franchisor or make a payment. There are a lot of things that you could do. I am by no means a franchise or license expert in any way, shape, or form. As we know, I only play the lawyer on the Boardroom Buzz. It is a very complicated area of law. Of course, as we know, there are standard national things in the United States but there are also a lot of state law concepts. Should you go down that path, I highly recommend that you talk to an extremely experienced and skilled attorney,
Patrick Baldwin: A specialized attorney. Not just any attorney but a franchise attorney. I love what he said about, what's a good franchisee look like? It's a spectrum of fitness franchising and service business franchising. It had to do without questions. Did you all pick up on that?
Seth Garber: Yeah. One of the things that stood out to me that’s part of the interview is when they talked about what makes a good franchise owner. The interesting thing that I thought is that he started out by saying the concept of somebody who wasn't from the industry but had run a business before was usually the best one. He went further on to talk about the fact that the ones that are the best are the ones that ask the most questions that are highly engaged in learning. The ones that tend to fail are the ones that know it all right.
Patrick, in our little world that we participate in, it's probably the same thing. The people that ask questions, dive in, and focus on learning are the ones that win the biggest. I thought it was interesting to hear that as a whole. I went through and listened to it a couple of times afterward. I started thinking about the different profiles of these guys that have taken these growing pest control companies and made them huge. Every one of them has this learning mindset. Gary nailed it when he talked through that. I'm sure you guys are seeing the same thing.
Patrick Baldwin: I thought about employees. The question is that if someone from Orkin, Terminix, or whoever comes in and applies for a job, how do you approach that person? Typically, they have a process. It's ingrained in them. They took that from the old business and they're going to bring it to the new business because they don't know any other way. Is it easier or harder to untrain and retrain or to take someone straight off the street? How do you even ask questions in an interview of an employee where that applies to figure out how they're going to be moldable and shapeable?
Seth Garber: That's an interesting point. If I went through the different roles in some of the companies that we all deal with, I've always found that on the technician side, when they come to work for a company, the company always says, “Whoever we hired them from, they didn't do this right. They didn't do that right.” It's always a common thing. They always go, “We do this better.”
The reality is a lot of the services that companies do are similar. From a technician’s standpoint, it could make logical sense to bring people in with that high level of education and teach them what your standard is within your organization. At the end of the day, the practical application when they get out there in front of the customer is they've got to do what's necessary. It's probably one thing on the technician side.
I will tell you as you shift over to the sales function, arguably the most successful sales reps that we're fortunate to work with and train in different things don't come from the industry. Historically, for small to medium-sized companies, if we bring in people that are not from the industry and we teach that and they have a good concept of the sales process and we can teach them the service side of pest control, they have remarkably higher results. The top guys that we work with in the country that puts up millions and millions of dollars in sales a year, that's where they came from.
I find that interesting. If we bring somebody over from another company and we put them in place, it's that factor of, “We know it all.” We see the underperforming sales reps, which is an interesting thing. I think about it from the day-to-day operations of pest control companies. I'd be curious, using the same logic, on the M&A side, the customers that are coming over to Potomac that are engaged in the process and ask tons of questions, is that a much more successful process for them than the ones that come in and hand you their books and say, “What are we worth?”
Paul Giannamore: I don't know if I would say that the process is any more or less successful to these folks, Seth. For me, it's more enjoyable to work with clients that are actively interested in the process and want to learn about it. I love that. Over the years, I also have come to appreciate the guys who say, “You guys are the experts. I have you for a reason. I'm going to sit back and relax. Tell me specifically what it is that I need to do.”
The worst type of client is the one who knows more than you and everyone else in the room. We run into that a lot in pest. Many things have changed. The markets have been so dynamic. The valuations have swung dramatically. A lot of these old timers in particular are stuck in the past. They think about the ways things were done 10 or 15 years ago, which is not the case right now. Those guys are usually their own worst enemies.
Seth Garber: That resonates with what Gary had mentioned. It’s the same scenario that Gary was talking about during the podcast, Patrick.
Patrick Baldwin: I’m going to think about other franchise concepts you come across. Mosquito is new to the industry. Neighborly has one of those brands. Have you all seen any Dallas else pop up?
Seth Garber: We're seeing the companies that are trying to sell organic fertilizers. That's a new thing down here.
Patrick Baldwin: Organic fertilizer. Can we call it what it is?
Seth Garber: It's poop.
Patrick Baldwin: There we go. Thank you.
Seth Garber: I'm trying to think what other ones we've seen. I haven't seen anything odd. There were the sanitation ones that have come out trying to sell sanitation services. The Mosquito has been the largest. The other one that we're seeing a lot of is the dog cleanup companies.
Patrick Baldwin: Pooper-scooper? They're cleaning up the organic fertilizer and then selling it.
Seth Garber: That's been a big one. I don't know how much you guys are seeing that. We're seeing that in a lot of markets.
Paul Giannamore: Patrick, you remember meeting Matt Brill down in Atlanta. They owned Mr. Mister. They sold it to Terminix. We talked to Cassie about that. They also owned a company called Ruff Stuff. That was one of those pet disposal-type companies. Interestingly enough, I was on a plane. Seth, you mentioned these poop companies or this organic fertilizer. I was reading a tale. This probably took place years ago. There was a big zoo somewhere in the United States that was disposing of animal waste. If you could think about the thousands and thousands of pounds of giraffe doo-doo and all this stuff. They were paying a lot of money to dispose of this stuff.
They ended up getting into some dispute with a waste disposal company that was raising their rates. One of the guys that was working at the zoo goes, “Instead of paying the waste disposal company, why don't we put up a big sign and charge people to come and take it away? They can use it as fertilizer. We're paying to get rid of it. Let's sell this stuff.” They put up a sign. They turned from spending hundreds of thousands of dollars a year to get this stuff disposed of to making hundreds of thousands a year because people were coming and picking up giraffe poop or whatever it is.
Patrick Baldwin: That's cool.
Paul Giannamore: I don't know if that adds any value to our episode whatsoever but I happened to read that.
Seth Garber: You guys got me saying poop. I don't even like the word poop.
Patrick Baldwin: I don't know what other term there is. Do you go organic fertilizer in the toilet? Is that what you call it?
Seth Garber: All I know is I don't like the organic dog pickup waste companies. I don't like those operations at all. I don't like the business model.
Paul Giannamore: Patrick, I appreciate you doing the interview with Gary. I thought it was fantastic. Thanks for taking that one for us. Seth, what's going on in the Pest Daily world? What are you up to? It's the middle of August 2022. You got five months left before the end of the year. What's the latest and greatest with you?
Seth Garber: Pest Daily, we've got a lot going on. We hit a couple of pretty big milestones, which was pretty exciting. We crossed the 800-user mark, which was pretty neat. 50,000 enrollments, we crossed that mark as well. Actual courses are taken. That was exciting stuff that's happened. Coming up, we've got a bunch of new content coming on insurance. We've got several new hires coming on board. We're greatly increasing our presence with the company. It looks like there's some neat stuff coming to the end of the year, which we will be able to talk about at some point in the future. Everything's going well overall.
Paul Giannamore: Seth, that's outstanding work on Pest Daily. I've loved watching how you've developed that, you and your team, over the last couple of years. In addition to Pest Daily, I know that you've got a vibrant consulting practice over there. I know that because some of our best clients have been clients of Seth Garber. We've sent some folks over to you and it seems like you've got somewhat of a wait list going on, do you not?
Seth Garber: The consulting side of our business, I've been doing it since 2017. The results have been great for the clients. The thing about it is it's another one of these things I love to do. In the consulting world, it's difficult to scale up. I did it in the healthcare sector years ago. The reality is that the human touch is important in that connection. I limit the business. In today's world, we have 30 clients. That's about as many as we can take on. we keep a waitlist. It's one of my favorite things to do. The company, the results are there. I'm happy to do it and I love it.
Patrick Baldwin: Paul, you enjoyed what we've got coming in the pipe, episode 100. I tracked down one of your old professors maybe. You were part of his big study.
Paul Giannamore: Patrick, you did a phenomenal job tracking down Professor David Dunning of Cornell University. That's true, I was in a lot of psychological experiments but I was in one back in the late ‘90s at Cornell, which spawned the Dunning-Kruger effect. For me, it was a fascinating discussion. Patrick, that’s one I wish we could have done in person. I wish we were sitting there with David. The Dunning-Kruger effect is now a part of popular culture but we're going to be chatting about that next episode.
Patrick Baldwin: The third most downloaded episode yet is with Seth Garber. He's big on this.
Paul Giannamore: What was the number 1 and 2?
Patrick Baldwin: Number one is Tim Mulrooney’s Terminix Rentokil discussion.
Paul Giannamore: That makes sense.
Patrick Baldwin: Number two, we got Mr. Jarl Dahlfors. Number three is Seth Garber. He's in good company. It’s quite a feat.
Seth Garber: Let's be honest, Paul. I've been asking Patrick about it for months. When he told me it was number three, I was super pissed off. I then realized it was between those guys and I was like, “Sounds good.” We'll get the minions out there to get a bunch of downloads.
Patrick Baldwin: I didn't know number three was good enough for you, Seth.
Seth Garber: Don't get me wrong, I'm pissed about it. Those guys are awesome. Those interviews are awesome.
Patrick Baldwin: Glad to have you part of this.
Seth Garber: I'm excited about it. Thanks for the surprise.
Patrick Baldwin: See you guys next episode.
Paul Giannamore: Till next episode.
Seth Garber: See you, guys.
Dylan Seals: I want to remind you to go ahead and subscribe to The Boardroom Buzz. We have got some incredible episodes coming up that you're not going to want to miss. Also, if you've enjoyed the podcast, please go to the Apple Podcasts app and leave us a short review. We'd love to hear from you. Thanks so much again for reading and we'll see you next episode.
Seth Garber – past episode
The Redneck CEO
Tim Mulrooney – past episode
Jarl Dahlfors – past episode