Host: In 2020, today's guest and three other like minded entrepreneurs gathered to break bread and brainstorm around a common vision that there was tremendous opportunity in acquiring home services businesses. A business opportunity, yes, but also an opportunity to impact the lives of tradespeople. This impact is one that I hear a lot of my guests comment on. Some buy a blue collar business with the explicit goal of positively impacting the employees. Others only realize a year into their acquisition that this impact turned out to be the most meaningful part of their journey. In today's interview with Amir Habushe, we cover both of these opportunities, the economic and the human. And don't worry, we spend plenty of time on the economic one. As just one example, the first acquisition that Amir and his team made was an H Vac business in Arkansas doing about $10 million a year in sales. Less than three years later, that business is doing $20 million a year. We pick apart how they got from point A to B in such a short amount of time. Lots to learn in this conversation with Amir Habushe, CEO and Co Founder of Snowball Indust. Welcome to Acquiring Minds, a podcast about buying businesses. My name is Will Smith. Acquiring an existing business is an awesome opportunity for many entrepreneurs and on this podcast I talk to the people who do it. August Felker is a two time successful searcher, first with a traditional search fund. The second time around he did a self funded search. Today August runs Oberle Risk Strategies, an insurance firm with a dedicated practice group for searchers and acquisition entrepreneurs like you. If you've got a business under loi, Oberle will provide complimentary due diligence on that business's insurance and benefits program. A great no risk way to get to know August and team. They love helping searchers. They've worked with hundreds. Oberle is a specialty insurance brokerage for searchers by a former searcher. Check out oberle-risk.com O B E R L E Risk link in the show notes. Amir Habushe welcome to Acquiring Minds.

Guest: Thank you Will. Thank you for having me.

Host: Amir, you have acquired four businesses. Three in home services, one in digital marketing. And you are doing this under the banner Snowball Industries. So we're going to hear all about Snowball and what you've learned through these multiple acquisitions that can help other entrepreneurs who are looking to buy a business and maybe those who have already bought a business. But first, some background on you please Amir.

Guest: Yeah, I appreciate it. Well, and so you would know since since we last talk we actually closed on two more acquisitions so now it's now at six. All right, great. Yeah, we've been, we've been busy. I love it. So a little bit background about me. You know, I'm from L. A. I have my wife and daughter with me that actually live. My wife lives with me obviously and my daughter is like five, 10 minutes away. And we moved to Los Angeles or I moved to Los Angeles when I was 16 and fell in love with the town and pretty much stuck. Stuck there. My background is in CyberSecurity and Enterprise IT when I first started my career since then gravitated more into online businesses and digital marketing. That's actually how I fell into private equity buying and investing in small SaaS, E Commerce, D2C businesses. Over time gravitated, partnered with a family friend and since then with his background helping companies go public in the otcqb, partnered in doing a lot of advisory services where early stage companies that have some revenue looking for capital, our path is to guide them to go public and help facilitate that. And that's relevant to where we'll talk about snowball as well. But you know, doing that and helping helping early stage companies in their early stages including another private equity I was involved with called Kim makers in helping searchers finding a business, going through their due diligence process from pre loi connecting them with lenders, legal, the whole M and A process all the way to acquisition and post acquisition support was my role with my team. And that's pretty much has been a lot of my background in M and A and the trades themselves. Great.

[5:04] Host: Just want to circle back a little bit. So you were kind of more of a technology guy and your kind of early entrepreneurial dabblings were in buying digital businesses, small what SaaS businesses or content

Guest: businesses sort of thing, SaaS content, e commerce, also operating one within the banner of the private equity company that I was involved in.

Host: And so there are a lot of people out there, some of whom have been on the podcast, who make a career out of that and they stay in that digital world. Why did you not.

Guest: The multiples got out of hand and we were very dependent on different platforms. So if Google has an algorithm update or Facebook has a change in their policy, very frequently you're beholden to that platform. We realized early on that H vac, plumbing, electrical type businesses weren't in fact they were underinvested. And so the multiples as they were getting out of hand and the risk increasing made it unattractive for us to stay in that in that industry.

[6:15] Host: That's a strong Statement, Amir, that you left digital because basically you couldn't find a niche where there wasn't significant platform risk. But as I've looked at digital businesses and I'm not alone here, I tend to agree. It's really hard to find a business that a digital business whose sources of traffic or whatever it might be customers are diversified enough to not feel like there is enormous risk or that it's all kind of bound up in a single platform.

Guest: Yeah. And to add to that your competitors are global. You could have a business in L A and you're competing with someone in India versus if you have a plumbing company in, in, in Austin. All your competitors are just within that, that locality. And so it makes a lot more difficult. Anybody with Internet access and a laptop can start a content site, especially now with a lot of no code type software out there, can create an E commerce website, dropshipping and everything else. Competition made it a lot more difficult too.

Host: Yeah, right. Well it's often said that the magic of the Internet is that anybody can spin up a business and have a global audience instantaneously. And of course that works both ways that if you do that so too can everybody else. So the competition is the barriers to entry are low, which is good if you're on the outside and terrible if you're on the inside.

Guest: So the moat definitely eroded quite a bit over the past 10 years. So. Yeah, yeah, yeah.

Host: And not to mention Covid and just the desirability of having owning a remote business and just the lifestyle that it affords and so much kind of people chasing after that. You mentioned king makers which I believe today goes by acquirer. Same group, same folks that, so I, they haven't been mentioned I don't think on the pod maybe once or twice. But they're, they're a name in our, our world and they're sort of, I don't want to speak out of turn here, but sort of an educational business and also kind of co investing and, and helping the searchers that they educate then go off and do the thing and improve the businesses. They've got a whole model that they've, that they've worked on. So you were involved with them and then kind of learned a lot. You were one of the people helping the searchers that went through the kingmakers now acquire a program and chose to kind of do it yourself. Is that the evolution?

Guest: So the evolution is actually I was one of the founding team members. I was a director of M and A and the idea is exactly what you just said is Helping searchers actually own a significant higher equity in the business post acquisition, close to 70 to 80, 80%. And walking them through the whole process, including SBA, educating on them on that and really honing in on what their strengths are, doing a bit of a SWOT analysis on, on their weaknesses, their strength, their competitive advantage and everything else so that, you know, if, if H Vac is a background that they have, or if it's wireless companies or if it's granite, then we, we lean towards searching for businesses or you know, at the time that, that matches a bit of their background and that's important for, for SBA lending in general, for you to have some background in the business that you're acquiring,

[9:45] Host: although not always which we're going to get to when we talk about operators, which we will do deeply. So you strike out on your own. And what is the vision or at least what is the kind of the inception of Snowball? Because I know it iterated in the early days, so walk us through that quickly.

Guest: Sure. So it wasn't so much on the, on our own as we're searching and sourcing more businesses. We're finding businesses that are above the limit that SBA provides and SBA's is right around $5 million. There's obviously banks that would make an exception to that, but we were seeing businesses that are 10, $15 million. My co founder Devin Sony at the time met with my other co founder Xavier at, at a summit that an investor, one of our investors connected them with. And this is pretty much the origin of, of Snowball that I'm getting into, where they hit it off. They were talking about, you know, the trades, how they're recession resilient and, and pandemic resilient. A lot of people like to say the recession proof. But you know, there's, there's, there's more than anything else, there's a resiliency that is built into them with best practices. As soon as they met, the same mind connected. Well, Devin called me, hey, you gotta meet these guys. Xavier called his co founder Cieva and you got to meet these guys. And so the four of us, within a matter of a few days connected on a zoom call, got along so well, we decided to meet in person and come up with a joint venture where Snowball came into fruition. Xavier and Sieva and Devon flew down to la. The four of us at the time. I'm involved in a restaurant where I like to say I enjoy the fruits of other people's labor. It's not an Easy business. But but during COVID it was shut down so I had the privilege of using the facility and and the four of us pretty much mastermind snowball from 10am to to 10pm and broke bread and spent a good amount of time with each other really building and bonding and that was pretty much the right around say June July of of 2020 within within a four months period. Since then we identified a few businesses who wanted to acquire and really honed in on on on the H Vac and a plumbing company out in in Northwest Arkansas and the other one in Fairfax, Virginia.

[12:23] Host: Great. And where I'm talking you to to you today you are in Northwest Arkansas in that acquisition and I am in Arlington, Virginia not far from Fairfax. Your other acquisition. For the listener paying close attention, the the Xavier in C that you refer to might be familiar names Enduring Ventures is their holdco. They are big on Twitter. If you were at SM Bash they were on stage at SM Bash and they're mentioned on my first million. I mean they're people who are who are known with Enduring Ventures. So just want to make sure that that's clear. And when you say you all kind of there was this chemistry between you cva, Xavier and Devin. It was personal. Well I assume it was personal chemistry but it was also around a vision I guess and just the appealing nature of kind of trades and how the appealing business characteristics of trades but I also assume kind of the untapped potential and the thing that a lot of people who are listening will know well which is that they're maybe not as digitally forward or they don't have the best practices and so there's a big opportunity there to professionalize which is really the name of the game for again a lot of the listeners.

Guest: Correct. And if and a few things the chemistry outside of the personal which you know it's to this day, you know when you we have the privilege to continue having that partnership with your co founders and and get along with them so well. It's it's remarkable but also our core values into value investing and seeing people like Warren Buffett and Charlie Munger and Berkshire Hathaway and how they operate over the decades and how they managed capital and the reputation of the businesses that they acquired and how important that is to them. Our approach was exactly the same way. The reason Snowball is called Snowball is a hat tip to Warren Buffett's autobiography by the name same name Snowball.

Host: Yeah yeah I've listened to that book. That's right.

Guest: We all grew up on Those values, we all read his books and we all wanted to do the right thing and show that we can have impact driven company while also doing good and providing growth and value to not only our investors, but all stakeholders, which includes our employees, our partners, our vendors and everybody else. And then the other leg to that is outside of the trades, being a good business to be in, it's also having impact on the most amount of people because you can't outsource, at least to this date, a plumber to come to your house and fix your toilet or an H vac technician to repair your air conditioning unit. So us having a path where providing people with the ownership in the business that they work in, which is the whole idea for us to go public is that equity component and being able for them to have their net worth tied into the business, that they provided the biggest value, you know, in their best years, for them to be able to continue enjoying that for years to come and pass it on to their next generation is. It was a big mission in Snowball's inception.

[15:41] Host: Listeners of Acquiring Minds know that for almost any business you acquire, its success comes down to the people and how you develop and manage them as their new leader. Thing is, in addition to management, there is also a lot of process and bureaucratic work when it comes to your new employees. Payroll, compliance, HR technology, hiring, to name but a few. These processes are crucial to get right, but at the same time distract from where you want to be putting your energy in leadership. So Aspen HR is an HR firm and PEO that takes this work off your plate and handles it with the care it demands. Aspen is owned and run by Mark Sinatra, himself a successful former searcher. So Aspen's own leadership understands the HR challenges that searchers have post acquisition. The firm is offering Acquiring Minds listeners a complimentary pre acquisition HR and PEO review for your target business. Check out aspenhr.com or contact Mark directly@markspenhr.com so you have, you've constructed the business entity such that providing employees all the way down and perhaps especially the field crews, the ability to buy equity into I assume the parent entity, Snowball. And that will be equity that we all hope snowballs into something significant. And, and so this of course is not something that your average plumber, plumber typically has access to. So, so it's, it's hopefully providing a great financial asset for his or her family. And how would you say, how would you differentiate that from a startup offering, you know, shares to early employee or to all employees in Silicon Valley?

Guest: So it's, it's, it's similar and the difference is that the trade's never been privileged to have that option. It's always was the Silicon Valley, the startups, the technology companies that had that as a path of ownership for their engineers, their marketers and every staff member that they have. The typical plumber never had access to own stocks in the company that they operate in. We have plumbers that have shares. It's literally part of our acquisition process to provide shares to, you know, the field staff and the general managers and whoever wants to participate. And it's not just acquiring into the, into Snowball, which many have, that they prefer owning shares in the company as opposed to getting a cash bonus and they want to get shares instead because they believe in the mission and the growth of the company. We also provide as a retention and recruitment and part of our acquisition and it's something that now people are asking for it on a regular basis. It's like, hey, how can I get more shares in a company? How do I, you know, you mentioned the fundraising you have. How can I buy more shares? I want to have more equity stake in Snowball. Just to tie in a little bit to what we were discussing earlier, one of the things that impressed on me and our co founders Too was the GEs and GMs of the 50s and 60s and where they provided that American dream where you can do good work and participate in the growth of the company you're working in through the retirement program that they provide. That's exactly how we wanted to, how we want to operate. We want to bring back good American manufacturing type values into the trades and

[19:28] Host: to again use the comparison or contrast it with Silicon Valley, the there it's a little bit more speculative obviously because the startup that you're working for, that stock isn't likely to be more worthwhile. I mean just looking at the raw P, raw percentages of the, of the chances there.

Guest: Yeah.

Host: In your case it's a different type of business. Yes, you want to snowball and yes you'd like to, you, you'd like for this to grow is very large. But it's, these are, these are linearly growing businesses, not, not potential, you know, unicorns. Although I'm not saying you couldn't get to a billion dollars. So, so anyway, you know, respond to that, that, that difference.

Guest: We purchased like you said, we've, we purchased not speculative businesses but cash flowing businesses. And lucky for us there's a lot of investors that are interested in, in cash flowing businesses and the valuation as soon as you, we acquire a business at whatever multiple, you know, four or five times their, their earnings. When, when you combine it under the snowball umbrella and you start consolidating those revenues under one one holding company, well there is an exponential effect in the multiple expansion. So now as a group, when you add a million dollar in EBITDA business to Snowball, well, you know, fast forward and we're doing 5 million, then 10 million, your multiples goes from 4 times earnings to 8 times to 15. And plus that's tangible and exactly what the market is currently pricing it at both of the private and public markets because we're tracking both. And that's something that even as we're doing our capital raises, there's an actual stock value to our shares. So they know exactly, hey, Snowball right now is valued at 46 million. It translates to 30 cents per share. And then when we do the next raise, know, because we closed on two more acquisitions, it added this much more to our revenue and our bottom line, our valuation is now pegged at 50 cents and so on. So they can see that growth year over year as each milestone that we hit until we actually go public and

[21:53] Host: so on the point of going public, that of course is when the, the true liquidity of the shares can occur. What does that look like? What are you telling your employees and the employees of your prospective acquisitions about that?

Guest: Yeah. So right now we're tracking for Q1, Q2 of 2025 to go public. Depending on how quickly we will finish our audits for 2024 will dictate when we go public in 2025. But that's pretty much the path that we're headed. At the size that we will be by that time. The New York Stock Exchange would make the most sense. We have discussed the Toronto Stock Exchange. If we go that path, it'll probably be sooner than 2025 regulation. And the cost of being public and staying public is significantly less at the tsx, including the type of audits you would do private versus public, it's not as stringent and just everything else that you would have to pay to continue being listed. But right now our track record is in two years. And the only way that it would be sooner is if we decide, hey, we want to go through the tsx and what would make that decision is if we pass the $100 million mark before 2025 and we are, we are under discussions with some companies that will bring us closer to 120 plus before end of the year.

Host: So that's the key milestone. $100 million in revenue, which in H Vac I would imagine equates to 10 to 20 million dollars in EBITDA.

Guest: Correct. We do have overhead as a consolidated company at Snowball, but it would equate to about 15 to 20 million in EBITDA at the portfolio levels.

Host: And can you say what you're at now?

Guest: Right now we're at tracking for 45 million in revenue. Especially with the new acquisitions we closed on recently, ebitda. We should be around three and a half million by end of the year consolidated.

[24:13] Host: Are you aware of anyone else pursuing this? I mean, is this, is this. There's probably private equity rolling up particular like trades and other sweaty businesses that I'm unaware of. And I assume they're the exit they're also looking for. Is, is, is an ipo. Are you similar, first of all, are they. I don't really know that. I'm just speculating. And are you all similar to, to that playbook? I guess the fact that you're offering equity to employees is different. But comment on that, please.

Guest: We don't know enough companies or not enough that many companies that are actually going public through the trades as a path for liquidity. There's a lot of private equity that have their second flip. That's usually the playbook that they're at. Eventually you get to a size that the second flip is to go public. We do know of three companies that, that's where, where they want to be headed and they're looking for the right timing for them. One of them shared with us that they're looking to do it in about eight years and another one is preparing for it now, which means it might be in also two to three years. And this takes time to get to that, to get listed. But for us, the reason that's important for it to be day one being a publicly traded company. And that was, you know, the whole idea of, of Snowball. Outside of obviously the equity stake for, for our employees. We've noticed with sellers, the, one of the biggest concern is, hey, if I sell my business to you, when is the next flip? I know you talk about legacy, I know you talk about culture. You're going to take care of my staff, but you're not going to be the one that's still owning the business in, in five years, in three years, who are you going to flip the next one? When is that happening? So for us, we're able to right away address that and say when you sell to Snowball, you Sell forever. Because our flip is to be listed, our liquidity event for investors is to be a publicly traded company. And at that point there is no second flip. All investors have an equity stake in the company, including yourself as a seller if you want to retain a portion of your exit into snowball shares and so you can participate with that growth and you can have that second bite of the apple with the rest of the investors that we have when we go public. And they like that quite a bit because then they know, hey, the people that they're talking to right now are the people that are going to continue taking care of their brand, their equity and their staff over, over the long time.

Host: Well, and to your point about what you just said about brand, this is a topic that we're going to hit directly. But you keep the brands of the businesses that you acquire, which is probably also appealing to the sellers. Interesting that the sellers. Maybe it's not interesting, maybe I'm underestimating them. But you know, for all of the talk about how a lot of these small local service home services businesses don't have the professionalization, sometimes the word used is sophistication. That they are sophisticated enough to understand the private equity model that you know, if a private equity buyer is talking to them, that private equity buyer has their own exit plans. So they're not. So they, they get that 100%.

[27:35] Guest: 100%. They're, they're very keen, extremely astute. It's a small community. They, they talk and they share what multiples they received, what multiples the other so and so did. And what do they need to actually prep in order to achieve that? There are coaching organizations and training organizations set up specifically to get you exit ready around that.

Host: Really?

Guest: Yeah, absolutely. Quite a few of them. And coach them even on, on the PNL side. Hey, all the trucks that you have that you own, lease them so that your overall numbers look better. Start bringing a management team because you'll be able to get a higher multiple if you show you actually have a management team as opposed to, you know, the owner operator is doing absolutely everything and anything. So. And it's a one year process, it's a two year process sometimes to be able to achieve that. But when you model it for them that you'll be able to get 1, 2, 3 turns higher in your multiples exit, it's attractive for them to start getting exit ready. Absolutely. If you could this within, within the community.

Host: And when you say the community, do you mean kind of all home services, all trades or specifically h vac all home services. Oh, okay.

Guest: The ones that I've been involved with because we go to trades events quite a bit surrounds pool service, garage doors, roofing, electrical, plumbing, landscaping. So all these trades know fumigation and so on.

Host: Well, I wonder if those, those businesses, the coaching businesses that are helping to get them exit ready are telling them about searchers. You have this other option where you could sell to an individual or if it's all just, you know, kind of thinking is private equity is the, is the target audience of the sale.

Guest: I think they definitely coach them towards private equity as the bigger exit. But they do talk about searches that you'll have different people and that will reach out to you. Usually private equity is the one that people know that they'll be able to negotiate the highest cash exit. Yeah, we've come across that ourselves quite a bit. Yeah, yeah. And we're not the biggest cash buyer because you know, part of our process is actually to disqualify businesses that the only thing they're looking for is like the highest exit. Usually there's, there's issues with that as well. If you just give me as much cash up front and I just want to, and I just want to leave the business and we're okay with that. But our approach is make sure like we're at the core values level and we're also in alignment that you care about the culture, you care about training and development and that breeds into your rank and file and we'll be able to flesh that out regardless. But that's one of our ways of disqualifying a deal.

[30:39] Host: Well, let's segue into when you're talking to sellers and you know who's operating these businesses when you acquire them and then who operates them after. What's your model there? Anybody doing this at any kind of scale, I. E. Anybody doing it more than being the owner operator themselves has to have a playbook or a preferred way of having these multiple entities operate. What is snowballs?

Guest: Snowballs? Ways to always identify a GM to operate a business post acquisition. That GM would be either from within the company or us recruiting from our network or start reaching outside of our network. It's really important for us to make sure that the business can be its own standalone without day to day management of the holding company. What that means. Let's also make sure that within the first 30 days of acquisition, have a workshop, identify who's the leadership team, empower them to start taking ownership in their own decisions. 100% okay. If you make mistakes, we Coach you through it. In fact, we expect mistakes because that's usually an indication that you're willing to think outside the box and push the envelope as opposed to just staying within lanes and not deviating from them. But that's really key to what we do. If we can't identify a general manager to run a business, even right now as we're discussing an acquisition in Washington State, if we can identify a general manager either from our own network or within the business itself, then it's not an attractive business for us. We'll wait until we have someone identified there. Or if the business is within half an hour or 40 minutes. Physical proximity to a business that we already have operating, then that's okay. If there is no management in place because then we can lean on the back office support and leadership of the business that we have within physical proximity.

Host: Yeah. And the GMs, if they come from internal or they come from your own network, is there, is it more commonly A versus B or so is there an expectation you have that they'll come from outside or that they'll come from within?

[33:04] Guest: So so far it's 50, 50. We start from within. We start identifying part of our due diligence in conversation with the seller, you know, who would be a gm. We get a chance to check their background, check their work history and interview them as well. If we, if we see that that skill isn't there and it's not something we can develop, we can develop it, but not, you know, from day one. It will be over time that they can be an operations manager and then the general manager. Then we want to bring someone with experience from outside the organization. And typically that would be someone that is working for a company that is at least doubled or tripled the size of the company that we've acquired. Because you want to buy where you want to be headed towards. So they know what that company looks like, what the organization makeup is, what is their DNA. It's $5 million business is very different than 10 and it's very different than 20. So if you're five or six or seven, you want to get to 20, hire someone that is already working in

Host: that environment and from the same industry.

Guest: Yes.

Host: So, so if you have 10 million dollar h vac business that you're contemplating putting an offer on or closing on and it's doing, you know, 1.5 million, 2 million in EBITDA, you are going to go out there and you, somebody from the team, somebody internal, is not likely to be the gm. You are going to Go out and look for somebody currently running a 20 million or even 30 million dollar h vac business. And are there and do, do you have a roster of those people already? I mean given how active you've been in the industry or are you kind of having to, you know, not start from a standstill but you know, there are, you know, you might be reaching out to somebody for the first time with every, every new ac.

Guest: So we have a deep network at Snowball. One of the decisions we made is any person we hire is from the trades. So our COO is second generation H Vac tech. He worked in wholesale, has manufacturing relationships, has done consulting. Our VP of sales and our general manager now of our marketing company, same thing, 15 years from the wholesale side. They're all pretty networked. So if I'm looking for someone in Missoula, Montana to run an operation or plumbing operation and I don't have one identified there, chances are we can reach to our network maybe two or three degrees of separation and they're willing to relocate. So a lot of times they might not actually be within that location and they have some trades background. So if we have a plumbing company, it's okay for us to bring someone that has a background in H Vac or electrical as long as he's operates the business the way we operate the business, which is very retail minded with processes and systems and has a financial background not so much in running a P and L but at least managing a P and L and a budget and knows what good looks like. And I know that's a bit of an advantage for us compared to other searchers, but that was very purposeful for us to let's build our network, let's build our bench and let's make sure our bench itself has a good referral network for us to lean on.

[36:40] Host: Amir, you just said how you recognize that you all from, you know, the, the deep network and how active you are in the space, you have the luxury, for lack of a better word to. To be able to really, you know, find somebody to move to Missoula, Montana who's got a lot of experience and so on. And probably a lot of my listeners are not in such a position. That said, you and I in our pre call did discuss how you do pretty strenuously advocate for searchers if they're to buy a trades business that they bring in, do a similar model where they, they buy the business and they hire an operator to come in with them for the transition and beyond and not to so that the buyer the searcher can be hands off and just step away the buyer. The searcher needs to be active but not but. But the day to day of the business, the operations of the business, keeping the trains running on time. My, my phrase of choice that is something that, that you hire somebody else to do so that you can do the more strategic things from day one. I have referred back to this model now in multiple interviews and it was you who sort of crystallized it and really and really leaned on on that as something that you just fundamentally believe people should do. So I hope I haven't taken all the words out of your mouth. Please, please tell us in your own words and elaborate on. On why you. Not only why you. This model is good because it's kind of self evidently good but like sounds good but it also sounds a little too good to be true. Why do you believe it's actually so possible?

Guest: Okay, so 100% agree on that and I appreciate your continue to passing that word. It's actually really important in a lot of aspects. So let's touch on the first thing you said on us being in a lucky position because of our network. We created that luck. It was a very purposeful effect that hey, if we're going to continue doing acquisitions, we don't want to be in a situation where we don't have a gm, especially if it wasn't identified within. So what the playbook that I'm about to share is pretty much the playbook that I would do if I started from scratch if I were as a searcher myself and I wouldn't have experience in, in the trade that I'm about to do an acquisition. So first let's talk about the why. When you, when you buy a business, what's attractive about it? It's the cash flow. It's that consistent cash flow year over year for the past 10 years. And that cash flow has in it baked in many years of experience, many years of mistakes, many years of trial and error. Why would you like to reintroduce uncertainty to that cash flow when the whole reason that you bought it was because of its stability that it's been growing year over year. Especially when now you're putting your own personal guarantee and your home on the line on top of it. You should do everything you can to de risk that possibility. So that's on the why on the personal side from your end. On the why on the second side of it is on the employees that you bought, the business that they continue to operate in, they're afraid they're scared there's uncertainty on their end. They didn't want to sell the business. They didn't even know it was going for sale. So someone that is out of their industry getting introduced to run the business, are their jobs on the line? Are their paychecks in question? Are things going to change now? Because someone that doesn't have a background but just wanted to own a business is going to create instability for them, for their family, for their mortgages and for their rents. So that's the way and it should sit as a responsibility of the searcher. And then as far as the importance of hiring a GM and how to go about it, when you, when you hire a GM with experience, you bring with you that level of credibility, but also empathy and care that I care about this business to be successful. I want to take it to the next level. I brought someone that is from a business that is, you know, double the size, triple the size, has been doing this for 20 years. Here's his pedigree. I'm right along with them to be able to understand the business and, and help with any systems, implementations and anything that he's not within his strengths right alongside with them, whether it's leadership training, whether it's financial intelligence, whether it's marketing, whatever strengths that the searcher typically has that they can bring to the table. So my approach in doing that, if, let's say six months to a year from now, I'll be interested in buying a business and I start looking, is start getting involved in the community, go to trade events and join associations. There's every city and every state has one for contractors. Those associations are not tied to you actually having a contracting license. You can be a business advisor, you can be a financial advisor, you can be a marketing advisor, provide some value to join that association and start going to their events and networking. Not so much to hire the people that are within that association, but the chances are they know someone and they'll start sharing that, hey, I'm looking for a general manager. I'm acquiring a business in San Antonio, an H Vac company. Do you know any someone? Say, well, I know someone, but you know, they live in L A or you know, they live in Virginia and maybe for the right opportunity, they relocate. So you being part of the community and being value add will make a difference in how much they would want to help you in finding that. So that networking starts from day one of when you're ready to search to make your life easier. I would even encourage and this is where a Lot of searches, probably don't go this route but it's something that I would do especially if I'm going to risk my net worth on it is work for six months in a well run business. Find the best operator in your city that is doing 10 plus, has systems in place, has a good branding. Basically the outcome you want to achieve when you buy a smaller business, work at a discount. So if let's say you think you're worth 100 $200,000 a year, work for 50 to 60 anything that just pays your basic needs. Very frequently the smaller operation are their strengths is in accounting, their strengths is in marketing. So provide that service for them but in return ask it to be involved in the leadership discussions and running a H Vac service plumbing business. Say hey, I don't, I don't want to learn the business of fixing H Vacs but I want to learn the business of running an H Vac company. And for six months be very transparent about what you're trying to achieve. And it's a trade between the two of you in terms of you get, you know, high level services at a discount by providing additional value and learning. And just by doing that you understand more of the details of even negotiating with manufacturers, wholesalers, taking advantage of rebate programs that you would never be aware of being outside and can save you a ton on margins and programs that they have that a lot of trades people in the trades don't know. Working with a well run company, you'll be very much so exposed to it and knowing how to take advantage of that. So you have a bit of a leg up in other searches. When you buy a business that would be 100% my best approach, you want to go about it with the optics of de risking it. From day one the business never had to deal with debt. You're introducing debt. That business went through many years of seasonal ebbs and flow and economic recessions. They know how to navigate it very well. You've never been in that position. So bringing someone that has been there can be your right hand guy from day one. And that, that's, that's probably would be like my, my biggest advice to any searcher going in, in the acquisition path.

[45:12] Host: Yeah, well Amir, that does sound great and quite convincing. It does have the prerequisite prerequisite however that the searcher is committed to a home services acquisition or, or if you use this playbook for some other industry that they need to want to know the industry that they're going to buy a business in. And many Searchers do, but many don't. Many are ultimately just driven by the deal that they can get. Really. So, so I just, that that needs to be, that caveat needs to be pointed out. But yes, how strong to buy an H VAC business after you've worked in another one? Well, run one for six months and really got your hands dirty. And no, you know, understood what it looks like and then, you know, built a network and found an operator to come with you to buy that business. The operator is more experienced than you, but at least you have six months of experience, which helps your own true capabilities, but also your credibility with both your operator and your new employees. So it's a, it's a, it sounds like a great recipe. Great. Amir. And, and to the point about, oh, how do you incentivize operators? So I know this is a topic unto itself, probably for HR specialists, but give us just some bullet points a minute on if you were buying an H VAC business in Missoula, Montana, you know, what are the broad strokes of a compensation package you would offer to an operator to have them go move there and run that business?

Guest: Yeah, as, as a, as a searcher will be slightly, you're a bit more limited as opposed to a Snowball because we have the equity component we talked about and, and a few other incentives that we can provide. But as a searcher, I would absolutely tie them into the, for the GM position to ebitda and, and by saying that you can just have a baseline that this company is doing 1 million, let's say anything above 900,000 or you can be even a million, whatever economics that you want to incentivize them over time, they get 10% of that profit share. Building a budget with them that, hey, you can participate in this, in this 10% or if it's based on growth that you want to motivate them while maintaining gross margins, then you can provide a budget where, hey, if we hit these milestones every month or every quarter, you get paid where you hit these revenue and thresholds while maintaining this margin. So if you want to optimize for growth, then we will base it on gross margin within the budget. If you want to optimize for the bottom line and stability, then you say anything above X in on, on EBITDA and you'll get a percentage of it. And that would be the two approaches on what am I trying to achieve. At Snowball, we have a little bit more flexibility. We can dial it in based on position, whether it's the service manager, the construction manager or the general manager. And so divisionally will will adapt and they'll have their own budgets that rolls up into the full end to the complete entity at the top and add to it also stocks and equity. I would encourage searchers to think with ownership in mind for the GMs, especially if they want to have a long term engagement. They can have a vesting period on that equity portion with them with a one year hurdle. But a lot of searchers might not be interested in that path.

[49:09] Host: They might not be interested. Why? Because they want to keep as much of the economics as much as the equity as possible.

Guest: Exactly.

Host: And one other question, Amir, just on, on kind of the two models that you spelled out of how to structure a profit share either growth of revenue while maintaining gross margins if you wanted to be kind of more growth oriented, or growth of EBITDA or growth of EBITDA while maintaining gross margins percentage of ebitda.

Guest: So let's say you just care that the business is doing, you know, 10% EBITDA or 15% EBITDA. And right now when you bought it, it was doing 1 million. As long as anything above continuing to keeping that status quo. Anything above that, you don't care how it's achieved. 10% of that will go to the GM. So if you grows it to 1.2 million out of that 1.2 million, the delta is 200,000 to when you bought it in the baseline of the million. So 20,000 will go to the general manager. And you can create, if you want to make sure that the EBITDA margins are not eroding and they're not going below 10%, then you can just say at the minimum it has to be 10% of EBITDA. Otherwise even if you grow it, then you won't achieve that milestone. It has to be above 15. And you can even create ladders that if it's above 15% EBITDA margin while also growing it, then you get 15% of the EBITDA difference or if it goes closer to below that, then it will be 10%. So you give them additional motivation and incentive to keep the margins above 15%.

[51:09] Host: Amir, is there some sort of

Guest: book

Host: or a reading material on structuring these incentive packages? Or is this because it, you know, there's so many little tactics and levers to pull and for somebody to get a primer on it I'm sure would be helpful rather than just being able to listen to it on a podcast. Is there some thing you point people to or have you just Accumulated this knowledge piece by piece over the years.

Guest: So I've been lucky enough to be surrounded by extremely talented people. So let's talk about that for a second. Every person within the Snowball organization is better than me and what they do. And that's been on purpose. I want people that are better than me. I know what my strengths are and my strength is more on the people side and leadership and vision versus my COO or operation and leadership and leadership training is more his strengths. And we have a coach director of education that we have. His background spans over many decades and he's been from the coaching industry and he's run companies and he consulted and his talents helps us become better as a team. So talking to them regularly, learning from them, as far as different incentive packages for the trade specifically that are based on a budget, tried in different scenarios and different trades and different moments of the company is what, what matters. If it's a turnaround, if it's a growth, if it's trying to stabilize it, then you, you adjust the compensation package based on that. I could ask them if there's a specific book, but I could tell you right now what they would say is we're building a university within Snowball. It's called Snowball University. Part of that is exactly what I just mentioned, where we'll have management training and leadership training. And this is how you set up a compensation, this is how you do a budget, this is how you can incentivize your GM and your service manager and your operations manager. And this is what that would usually result in based on these incentives. With that also comes financial training, comes best practices for call taking and sales process and technician process. And that's part of what we do and make sure accumulate all this knowledge into one online training program that over time as it gets flushed out and we finish all the master courses in it shared with outside businesses from Snowball. Wow.

[54:00] Host: Sounds like a really powerful corpus of knowledge that you guys are building.

Guest: Yeah,

Host: I want to go back to kind of tying in the. The operator, hiring an operator in your acquisition for a searcher. One of the things that you said offline to me was how you made a great point that $500,000 of SDE is kind of maybe a little low for what a self funded searcher might consider the best practice band, which might be more like 700 to a million and about whatever you can get before you start competing with private equity. Let's call it 750 to 1.25 million. But you pointed out that 500,000 SDE might mean that there's actually an operator there or some sort of management layer. Whereas a $900,000 SDE business might be $900,000 because the owner operators doing everything. And so they're effectively the same business. The same, the same. Like the profitability of these two businesses is effectively the same. One has just, you know, put money out to hire an operator or a manager or two and the other hasn't. Maybe, maybe that $400,000 difference is a little wide of a band. But the point remains. Don't, you're, you would say don't run away from a $500,000 SDE business. Don't have that be your filter because you should look at those businesses. You can quickly find out if the reason that the number is there is because there's management in place. Do you want to elaborate on that?

Guest: Absolutely. So it comes down to the quality of that SD and the quality of that earning. We've seen quite a few businesses that it's making, you know, 500,000, 500, 450. And normally you're like, oh, this is too small. But then you see the number of trucks they have. You see the management team, you ask for the org chart, you see there's a sales manager, service manager, see there's a warehouse manager. It's like, okay, this is not a owner ran business, this is a management run business. Now it's attractive. Now in that scenario you don't have to get a gm. They want G. Chances are between that group of three, four people you can provide your expertise because there's a management team in place and there is real infrastructure and bonds to the business that now you can build on. We've seen companies doing above 1 million in net income off of 9 individuals total. That indicates to us that the owner is doing absolutely everything and that if that business wasn't within half an hour drive from one of our companies that actually has a leadership and back office support, we would not be interested in it. Or if we are, we're going to pretty much backtrack and say, hey, what would it look like for us to stabilize that business? Well now it's looking closer to 750,000. Okay, so let's base our acquisition price as if it was a 750 business as opposed to a million dollar business. And that's part of the whole add back. But a lot of owners will struggle in seeing that as well. So yeah, I absolutely would not just walk away from something that is below 500 at the very Least it's worth looking one layer deeper. I would say even a third layer similar to buying houses. Start comparing the P and L and the prospectuses and the simulation to the actual physical business. Take a look at the warehouse, take a look at the shop and how they're describing it on paper might be very different. Walking into it, they might have a reception, they might actually have well run cubicles and service Titan implemented or service fusion or any software. They might have good clear organization in place, no need to discard it. Until you start connecting PNL sims to physical brick and mortar. Order walkthrough and then vice versa. You might see really great businesses on paper. You go visit them and it's basically, you know, running off of a Conex box just as a storage. And we've seen that sometimes maybe two Conex boxes, but they absolutely exist. So that's what I start building that muscle between tying in the online representation of it, the financial representation and the actual physical brick and mortar.

[58:44] Host: That's great advice, Amir. This is going to be a, a question whose answer is of course it depends. But if you have, if I pushed you to generalize for the searcher, listening is, is which is more appealing, the business that has less SCE because there's some management there already, some structure, some professionalization or the raw business with a lot more SDE but you know, a lot less mature in terms of professionalization and management because you know the, the raw business, like that as as many searchers will, will feel and will say like that's the opportunity, that's my opportunity to be the one to professionalize it. So do you have, you know, a go to answer on, on, on this, this fork in the road between these two options.

Guest: As the first business, I would say the one that is a little bit more structured, the messy one, the one that the opportunity lies, that should be your second business or the second acquisition because now you know what you can do with that mess. Now you can see the opportunity that from the outside you wouldn't recognize. And some of that opportunity might actually be in lower margins and the company's not doing well. And you can identify that this 300,000 EBITDA business, it's actually 600 to 700,000 because they're not doing X, Y and Z that we now are doing on this company. You wouldn't know that until you actually are at least six months to nine months in that business. Your optics will change as far as what even an opportunity means and what a mess means and where that lies at Least the first business get something that is well run that you can start scaling and growing. Second, third, have at it. Great.

[1:00:38] Host: I love that you had a very clear answer.

Guest: Yeah.

Host: Amir, you as we said at the outset, you are sitting in one of your acquisitions. Anderson is the name of the business.

Guest: Yes.

Host: There's a big beautiful A over your shoulder. The logo of the business. That does look like a spiffy modern logo for, for a home, home services business. I don't know if that's your influence or if they, if they had that logo before, but it looks, it looks slick. Why don't you give us quickly the story of that acquisition, your first and then I want to ask about keeping the brand of your acquisitions.

Guest: I'll.

Host: I'll ask it again. So give us a story please.

Guest: Sure. Absolutely. So Anderson Air didn't have a website when we acquired it. So so this is, this is a company that is doing. That was doing 10 million plus in revenue with no website and no marketing. Everything is just was relationship based over three generations. From the grandfather of the current GM which that's its own success story of the GM is the son of the owner that we bought the business. We identified that he has all the leadership traits that we're looking for that is empathy driven, kind, respectful and very much so about keeping the reputation and leading his team that way with great temperament to boot. And that's really important when you're scaling and growing company challenges will happen all the time. You need someone that has good temperament. But segueing on the actual first acquisition. So Anderson being the first acquisition for us, we saw the opportunity right away in the people. I think one of our due diligence was when we came and saw the operation. You can see that when you walk into their offices they treat you like family. The sudden hospitality, it's not just a buzzword, it's not just what people talk about. You feel it walking into it and they treat you like that. You want to know whose family because everybody is treated equally in that sense. That made an impression on us and something that we absolutely wanted to continue building on. So after doing our due diligence and saying that a lot of the partners that they work with, a lot of the builders within the community, it's a very close community that we can see there's longevity we can build on. Northwest Arkansas in general is growing at a very rapid clip in terms of population growth and investment. A lot of that is driven by the Walton family, the JP Hans and the Tyson family. They're investing quite A bit into this corner that's helping new construction. So we can see that Anderson can have a good 3, 4, 5, 10 years ahead of it in building as part of that community. So with our due diligence on that and talking to the sons that were at the time service technicians for the owners, which was their fathers because it was three brothers, we wanted to give them the opportunity to be in management positions. We see the importance of continuing their legacy through the generation. John Anderson is the son of Mike Anderson and he was the primary GM and the primary owner of the business. We talked to him about being the GM and then he stepped up and he's been the general manager from day one. Over the past two and a half years now, he's grown the company from 10 million to 20 million plus. That's where we track three years in two and a half. In two and a half years it would be three years in December and that's when they will hit 21 million in revenue. Yeah, impressive from 30 personnel to 70 plus. That's not easy to manage 70 plus workforce. So we help them through collaborative workshops and leadership workshops that we do to build his leadership team. He has a great people and culture person that is his right hand. Well, not right hand man, but right hand woman. She's fantastic. She's more than anything else, she's more like a people operations person. We have a great service manager that recently joined us about six months ago and a pre construction manager that joined us about two months ago. It took two years to actually build a leadership team in those positions. Prior to that, there was the, the other two cousins in the business. One is Jason Anderson and the other one is Derek Anderson. Derek is now the lead estimator, the senior estimator. That's what he enjoys doing. A lot of the relationships that he has with the builders, it's, you know, something that he continues to build on. And we have Jason Anderson that he's our comfort advisor. Last year he did 2 million in sales. This year we're not even six months into the year, he's already done 1 million and the season hasn't even started. So we're, we're projecting that he'll do close to 2 and a half to 3 million in sales all by himself. So. And by himself, you know, there's a whole team behind them. But as a salesperson, so that's exciting for us. This is a team that three years ago was getting paid $19 an hour, $20 an hour, and now they're doing north of six figures something that they're proud of.

[1:06:50] Host: That's really quite a success story. Amir, congratulations.

Guest: Yeah, thank you. And the team just started. Now we have the leadership team in place that we can see just continue having that, that successive growth year over year.

Host: And what unlocked the 10 to 20 million dollars growth in, in less than three years, in whatever two and a half or three years. What was it your big brains coming in or was it giving, was it giving the, these guys kind of a longer leash? What, what, what was the magic there? I mean that's, that's impressive.

Guest: Um, definitely wasn't my big brains and definitely not. The issue was providing them autonomy and coaching them and really investing in leadership and, and, and training. I would say the, the pivotal moment was bringing our CEO Matt Ballard to the team and him his experience in running their, we call it EOS Lite workshops where it's a very soft touch approach and a very collaborative approach in building the leadership team. And it's going to be messy and it's going to have a few false starts. The leadership team that was in place two years ago, it is not the same leadership that is in place today. So it came with let's invest into the leadership team. Let's focus on the GM and his support staff and it's empowered them to make decisions, let's empower them to make mistakes and allow them to grow with it and us coaching them side by side. Whether it's weekly, one on ones, quarterly workshops, however that is, let's walk them through it. Our, our general way that we engage with operating companies is very consultative. It's pretty much falls into three buckets. Either collaborative, which is where we prefer, and we see the highest growth when we have that type of relationship. Helping hands is when we actually take on some fractional role within the company. That's not where we would like to be and it's a bit of a stop gap until we identify the right person to take that on. And the last one is prescriptive. So if they specifically just need help with X, you know, come down, work with us. As far as the add on sales or financial intelligence or building a budget, it's very specific. We come down for like a day or two or help with one specific task, negotiating with a vendor, whatever that is. Where we like to be is, is collaborative and it shows the testament with Anderson what we accomplish when you have a collaborative approach with the operating company, the growth that you can achieve by doing that.

[1:09:34] Host: So Amir, you, you training is clearly a big part of the success of Anderson of the growth of Andersen. But it's also something you're baking into the overall snowball playbook and, and family and mission. I heard you say Eos, EOS Light. What can the audience, what can searchers, people looking to buy one business or maybe you've already bought one business learn from you? Is EOS really a panacea? I mean is it really just like here retraction and, and please tell people what EOS is.

Guest: Oh, EOS is entrepreneurial operating system. Operating system, yeah, I call it Eos and then it's, you know, a lot of people call it eos. But what it is is it really gives you a bit of a framework to work under because it gives you an opportunity to zoom out a little bit, a lot of it and not get lost into the, into the weeds of the business and into the day to day. So you know, you purposefully take a day out of, out of your, out of a quarter to really discuss. At least the way we go about it is to, and this is the light version is to discuss issues of the business. And you have a platform that the reason you have those issues for like in a very constructive time for about an hour is so that any venting that you want to do on every meeting that you will have people, people want to vent, people want to talk about all the issues. So let's just have it in a constructive way, put it all on the board, but let's have a bit of a time limit on it so it doesn't take up all of our day. And when you put all those issues on the wall, people feel at the very least that they, that they hurt, that they're heard. And there's a real practical reason that I'll get into in a second why you want to actually write it down on the board. And, and it pretty much leans into the next step. And the next step is really identifying over the past 90 days, what are the things that you liked, what are the things that were done right, what are the things that you enjoyed that you were part of, whatever that is, whether it was a new hire, whether it was a new technology, whether it was a birthday event or an outing. You want to talk about the positives. We also want to talk about the things that you were longed for, things that you wished that we had that we didn't. And then the last two is lacked and then the other one, we call it the four Ls and sometimes it can get a little bit forgetful about it. So liked, longed for, learned and lacked. The reason you put all these things on the board, including the issues, is one you want to see patterns, especially on the weaknesses side. Those repeating issues, those repeating items that you can actually take action on and have traction with are the ones that you start building your next 90 day plan. This is when you create your one page action plan where depending on the leadership team that is within the room with you, which one of those falls under their preview that they'll take an action to address that. And you keep it to no more than three items. So one, two or three max. Really making sure that it's a smart action item with real timely deliverables around it and well defined. And you start working on issues that you guys have and you want to make sure that there's real accountability and ownership on that as part of your leadership team so that you're not lost in that weeds and the business doesn't always fall under just putting out fires. There's somebody that actually start building the sprinkle system and building the safety precautions so that we don't get into those situations in the future.

[1:13:40] Host: That was great. Well, EOS is a vast topic and we could spend a whole episode or probably multiple on on it. So we'll. I'm going to just going to put it, leave it there. But Traction is the book where it, it was, it came from.

Guest: Right? Yeah.

Host: So but now I assume they're behind you there.

Guest: Yeah.

Host: So if people want to deep dive, first step is to read Traction. I assume there have been many other books now written about EOS and how to do it and so on. And there's people, there's consultants who, who are EOS consultants.

Guest: Right.

Host: I mean there's a whole little cottage industry around EOS now.

Guest: So I would add on top of Traction to read Get a grip. It's the book that came after Traction that actually shows examples of how Traction was implemented and how it was benefited an organization. These are stories based on, on real life examples of the consultants that they're being shared and gives you a little bit more of a practical knowledge or experience that you can read of like how it was applied and how it benefited an organization. So then when you go back to the actual Traction and review it as your workbook to achieve the same results and really explains the why behind a lot of things.

[1:15:01] Host: Great, thank you. I was going to circle back and ask you, Amir, about maintaining brand at the businesses that you acquire. You've kept the name of Anderson, but you actually also kind of created a logo at the very least yeah. And so, so talk. Talk us through that. Talk us through what you would prescribe to searchers and this probably is also an opportunity to tie in your digital marketing business acquisition. So all of the above, please.

Guest: Absolutely. We're big believers in retaining the brand and the brand equity that the company pretty much built over decades. Anderson is a perfect example of that. For 60 plus years. People are familiar with Anderson and Anderson Air. Last thing you want to do is tarnish that name and rewrap it with the holding company and wanting to build that. Snowball is a company that has only been two years old. Nobody knows of. Snowball will not land well, especially replacing an organization that has deep roots within the community. And Anderson is not the exception. Diamondback is the same over 30 years plus they built a reputation and same thing with, with Clover out of Fairfax, Virginia and Ashburn. So you want to build on that. Since Anderson didn't have quite an online presence and didn't have. They did have a logo but it was mainly just a font script that was, that was written. We decided let's do a refresh on it while keeping sure that we are true to their roots, which is not to be too creative on the marketing side of it, to be respectful to the business itself. So when we did the truck wraps, we wanted to make sure that it's low key but it stands out. And probably if you go to their website, you could see andersonair.com, you could see some of the truck wraps we did. And the color that we chose actually worked out well. It wasn't just purposefully blue, but because Walmart is. So you put this here. That blue also worked well within the community and it's not Walmart blue, but it's close to it. And that was.

Host: You want your business to survive.

Guest: Yeah.

Host: Sue it out of existence. Yeah.

Guest: So. So we stayed away from that. But it was, it was a sheer luck on that one. So we absolutely big believers in retaining the brands.

Host: Well, I was just gonna, I just wanted to.

Guest: To.

Host: To emphasize what you had told me in our pre call that that not, not just for the market awareness of the brand, but be just this point about employees really associating with the brand. You know, I'm, I'm an Anderson Air guy. I'm an Anderson Air gal guy or gal. So there's a real connection that employees feel to their brands and you don't want to disrupt or jeopardize that.

[1:18:11] Guest: Right. It's their tribe. You know, it's like in the military. You know, you have The Marines, you have the Navy, you have the Army. They're proud being in the military. They're proud being part of Snowball. But their tribe is the Marines. The pride is the Navy Seals. Their pride is being. And there's subset of that tribe because you'll have the service department and you'll have the new construction department. And they understand that they're part of the bigger tribe that is Anderson Air. And Anderson Air employees know that they're part of a bigger organization that is in Snowball. But being respectful to that levels, that they have that ownership and the badge of honor that they wear with it every single day and every time that they pick up the call and say welcome to Anderson Air, you can feel it, you can feel it in their chest bumping up and the walk and saying that, hey, I work for Anderson Air. And then they can talk about the benefits that they get as part of being that tribe. So that's important to us.

Host: Yeah, no, it's, it's a, it's a great point and kind of as you articulated it, it seems obvious, but so often we, we think about brand in terms of how brands hit the consumer and how it, what the brand means to the consumer and to the public. But the brand has almost certainly much stronger meaning to those internal to the organization. So treat it, treat it like the sacred thing that it is.

Guest: And to your point, the customer feels that, you know, how pride, how much of a pride does the customer service rep carries themselves when they talk about Anderson? How much of a pride the service tech talks about when they walk into someone's house? They feel the pride when they roll with a brand new truck, wrapped clean and everything in between in that customer engagement experience, the customer feels good that they're working and engaging with this brand.

Host: Thank you, Amir. On that point, let's circle back around as a final question to improving the lives of employees, particularly people in the trades. So this was something that was a shared vision between you and your early co founders. You've given us an example about how the sons of the sellers who were technicians are now are now management, earning six figures, growing the business. Also, I'll just say as an aside, many of my or a number of my guests have said that even if they didn't set out to buy a small business for this reason, maybe they like the, the adventure of being. They wanted to be an entrepreneur. They like the adventure. They, the economics were compelling. They have found that improving the lives of their employees, helping their employees grow has been this incredible, this incredible benefit value that they've experienced which they underestimated going into it. Some people go into it with, with that explicit goal, but many it, it surprises them. But pleasantly like extremely pleasantly like wow, this is so, has been so valuable to me personally for this reason for helping my, my employees be their, you know, be their best selves. So what can the audience learn from what you are doing there at Snowball with that explicit mission?

[1:21:33] Guest: And so yeah, I love one of my favorite topics is impacting people. And no other industry can you have that privilege to impact as many people as the trades getting into it. All of us, you know, we happen to have that in mind from day one. How can we make their lives better? Not just financially, not just through ownership in the company and their own net worth, but also the quality of the life that they live. That also comes from the benefits package that we provide. You know, we have the same benefits package that you would get at a startup or Silicon Valley type business. The same benefits package that I have as an executive at Snowball, the same a benefits package as the CSR or helper or a rough in construction person have. Whether it's health insurance, life Insurance, Vision, Dental, 80% or 85% coverage for your whole family, not just yourself. Want to make sure that when you are working at 100 degrees, 100 humidity or installing H vac system or 3am Fixing a sewer line, if there's a, you get a text from your wife that you know your daughter or your son is sick, you're not worried about can I afford the co pay, can I afford the medical bill that comes with it? And you can continue focusing with clarity on the job at hand because it's a very dangerous job. It's one of the top 10 dangerous jobs is the construction more than you know, firefighters and the police. So why don't we extend the same executive package through and through within the whole organization. So it's a privilege for us at Snowball to have that responsibility of 150 plus families and we take that to heart and we continue making sure that any decision we make, we understand the impact is significantly more than just us and continue working in that lens. It's something that it's every single person within the organization has and Amir to,

Host: to really crystallize this for the audience as a takeaway, is there a particular concrete way that they can benefit employees when they, when they buy a blue collar business? Is it, I mean I heard, I hear you talking a lot about the benefits. Is it basically like would that be a good Place to start. Look at the, the existing benefits package to the extent it even exists and do what you can to improve and provide a really generous benefits package. Or is it not quite so tactical and simple?

[1:24:11] Guest: It's simple for us because we have the benefits of scale. It will be beneficial for them to look into it, to look at it, to see where they can improve and at least make some improvements from day one. But really what you want to start drumming is that you're not important as a, as the searcher. They are, they're the revenue generation. They're the guys that are working in the business and you're going to start implementing and actually be true to your word and follow up training, setting up development programs, giving them career mobility, anything that you can show that you want to improve their lives. Because some of them might have already really good benefits packages from their partner, some of them already might have that implemented from the owner. Some of them might have a profit share program and some don't. See what's missing. See how you can add value. See what it will take to get there. Maybe it won't be day one, maybe it's year one. Be transparent and share that with the team so that they know, hey, if we achieve this, we can make these changes. It doesn't have to be with the whole company. Could be at least with your leadership team and then work with them as far as like hey, if we achieve this, we can, we're able to provide this benefits. Let's get there. And so you have a bit of a unified mission and vision with it really changing your mindset that this isn't a watershed event for you to, to change from having a 100, $200,000 salary career into all of a sudden having a business that is cash flowing 700,000 or million. This is more than anything else the path for you to impact a significant amount of lives outside of yours.

Host: Very well put. I'm going to end my questions there. Amir, is there any topic that you wanted to air that I didn't ask you about?

Guest: Let me just share a couple of things as far as where we headed. So you mentioned marketing company that we have that we acquired. One of the reasons we acquired that companies. We noticed a lot of companies don't do well in, in SEO, especially when it comes to, to the trades. It has a bad reputation. Quite a few. I don't even know what's involved in getting that done. It's not just writing articles online and significantly more involved in that. Us having that digital background that I mentioned earlier and identifying a business through our own network that they, they do, I would say easily one of the top 1% in SEO out there that just have really good operational systems around that. And we have Anderson Air for example's traffic is close to 50,000 plus visitors a month. That's unheard of for H Vac Co. In a city that is surrounded by about 300 to 500,000 population.

[1:27:09] Host: Especially when it didn't have a website.

Guest: Especially when it didn't have a website.

Host: Wow.

Guest: Two years ago. So less than two years ago.

Host: I'll take 50,000 visitors to the Acquired Minds website please.

Guest: Yeah, so and that's what's unique about them and that's what's unique about the content strategy or SEO strategy for us that now that we have this base that online brand is increasing. Yeah, they have an offline brand, they have a community brand within where they've been operating for 60 years, but they had none online. We can start leveraging that and go outside northwest Arkansas, we can go work in having a set up shop in Little Rock a little bit more central because we get a lot of traffic from there as well. Content marketing, as much as you try to be localized, you will get a ton of outside traffic from areas that you don't anticipate. So you can start leveraging that. So that's been a bit of our secret sauce in terms of the demand generation and generating leads for our organizations that we acquire is marketing. We have pretty much down pat and we openly provide that service to other companies that are interested. So once we solve for the supply side of the equation by better training for the technicians and recruiting and development, the other side of it is the demand generation. Because no matter what, doesn't matter how good your culture is, doesn't matter and how well you pay if you don't have, if the phones are not ringing, if you're not generating the leads, you're going to, you're not going to keep the technician's job full and you're going to lose them. And when the phones are ringing, you're a winning team. And technicians want to work in winning teams. Everybody wants to work in winning teams. So being able to always conscience on both sides of that equation is something that is quite unique to us.

Host: And so just to be absolutely clear, the digital marketing firm that you acquired, it still takes outside clients.

Guest: Yeah.

Host: So listeners, if they have already purchased their business, they could, they could reach out to you guys in the name of the firm is the design firm

Guest: is digitally savvy Digitally Savvy.

Host: I don't know if you can answer this off the cuff, but while I have you, Amir, what is it? What is roughly the monthly outlay to Digitally Savvy for like a comprehensive SEO package for a local home services business who wants to get to 50,000 visitors? Yes, I know that there's no guarantees, of course. SEO, Google, it's all a bit of a black box. But if somebody likes the sound of that and they want to shoot for it, what can they expect to to pay about 6,500amonth. Okay, great.

[1:30:00] Guest: And it is premium, but it's because they provide a premium experience.

Host: Okay, what is the best way? How do you prefer people reach out to you?

Guest: If they have questions, they could reach out to me on on Twitter or LinkedIn. My handle is my last name at Habuche and same thing with LinkedIn. If you look for Amir Habusha, you'll find us. I know one of the things you mentioned that we're talking about is also our capital raise and our crowdfunding that we do. If people are interested and they want to be notified whenever we do have opportunities to take on new investors and could be $500 to 500,000. That's the beauty of heading towards public traded company and doing the crowdfunding route. To achieve that, you can just sign up to our newsletter and we'll notify them.

Host: So to be clear, anybody can become an investor now and participate in this predicted IPO in a couple of years.

Guest: Exactly. And with that there's milestones that we're achieving and crowdfunding is the path. We finished the round that we wanted to raise right now and we're planning on opening it again. And when it's open, and that should be in anywhere from 30 days from now or even sooner. And if you go to our website and you'll see invest in Snowball and you'll be able to either invest directly or get notified if you subscribe to our newsletter.

Host: Okay, well, great. I know so little about crowdfunding from the perspective of an actual operating business like yours that I don't even know what to ask as a follow up. But interested people will. We'll go to your website and look into it.

Guest: I would love that.

Host: And we are at time, sir, so I'm going to let you go. This was a comprehensive and really interesting conversation. Amir. Really neat what you're doing with Snowball. And I think, I mean as you could feel throughout the course of the interview you've done, you've gotten so much experience across these now five home services acquisitions that I know the audience who have yet to do their first acquisition have a lot to learn from you. And so I. I think we drew got squeezed you for a lot of information. It's been really valuable. So thank you, sir.

Guest: I love the opportunity, Will. So I really appreciate you having me. Ra.