Austin Gray: What's going on, everybody? It is Austin with the OWNR OPS Podcast. Welcome back to another episode. In this episode, I host Casey McDaniel, the pest control guy, once again.

We had him on the show earlier this year, and he talked about starting his pest control business. But Casey just bought his first pest control business as a strategic growth opportunity.

So, we dive into everything here. We talk about why he used acquisition as a growth strategy. We discuss deal structure, deal size, what SBA lender he used, and unexpected curveballs that were thrown during the acquisition process. I asked him about the first three things he did post-acquisition. We talk all about it, so if you are interested in acquisition as a growth strategy or if you have a current small business, listen to this full episode.

Casey just went through the whole acquisition process and has a lot to offer and share. I hope you enjoy it!

If you haven't already, would you mind leaving us a quick five-star review? We'd really appreciate it. Thanks again for listening, and let's jump into the show!

So, welcome back to the OWNR OPS Podcast. We’ve got Casey back on with King Pest Solutions. He just bought another pest control company. If you guys haven't listened to the first episode, you can go back and listen to it. It was one of the first episodes we ever recorded on this podcast regarding guest interviews.

You've been growing your own pest control company; you started from the ground up, and now you've bought your first pest control company as a strategic acquisition. So, welcome back to the show, Casey.

Casey McDaniel: Yeah, thanks! Good to be here. Hopefully, we can share some fun stuff. I've actually had a few people reach out to me that said they listen to your podcast, so it's been cool to make some connections through it. Glad to be back!

Austin Gray: Well, let's talk about acquisition. Tell me about how it went.

Casey McDaniel: Yeah, so, I mean, starting off with searching for it, it's not something that we weren't like the traditional searchers who have been looking for years and, you know, backed by investors and stuff. We were just running our company.

Last fall, we reached out to a bunch of local companies in our area asking if they would be willing to sell, and none of them were. We were looking at some other markets, thinking we were just going to open a new branch. Then, as we were kind of looking at some of that during the winter, on BizBuySell, there was a good opportunity that popped up in Colorado Springs. The numbers all looked good, so we started talking with a broker.

Yeah, we had an LOI signed in, I think, February, and we were hoping for a pretty quick close because it was a pretty small acquisition. However, one thing after another just kind of pushed it back, pushed it back. Finally, on July 12th, we got it all signed, and it's ours now. It took a little while, but it was good.

Austin Gray: That's great! I have so many questions about this process, all the way from your strategy behind acquisition as a growth model. I also have questions about the actual deal structure. Before we jump into those, feel free to decline any sort of question there to keep it private. But I am really interested in how you structured the deal. I know you tweeted about the SBA loan process, and something that I found to be really interesting was the fact that since it's an acquisition within your same industry, you were able to forgo the 10% down payment.

So, we'll get into all that, and I would love to understand what it's been like since you closed now taking on this new team.

Let’s start with strategy: Why acquisition as a growth strategy?

Casey McDaniel: Yeah, so it was something that we, from the beginning, had decided that if there was an opportunity, we would take it. But it's not our only growth strategy. If we couldn't source a deal, then our game plan was just to open a new branch, just like we opened our first one—just hire some sales reps, hire some technicians, and just start getting sales. We wanted to grow a second location more organically.

But this popped up, and we knew it was a good opportunity. If we could buy it and kind of use that as our base in this new location, then we could have sales reps run ads and then begin to build around it and add more route density. Our preference still would be to buy something in our local market just to add that density to where we're already at.

But this one popped up, so it's about four hours from our current location. We started in Grand Junction, Colorado; this one was in Colorado Springs. Overall, it was a good opportunity, a good price, and we kind of did it backward. We'll buy, and then we'll build and grow it there.

Currently, we've kind of got our hands full; we're not looking. We're not a big private equity platform who's just going to roll up a bunch of companies. We're out of funds now after this one, so this is our one acquisition. We’ll go ahead and grow this branch, and if we've got more cash in the future and another opportunity pops up, we wouldn't be opposed to buying again.

But right now, I'm not even going to be looking to buy or sell for a while. We're just kind of laying low and growing this branch.

Austin Gray: That's cool! So, let's talk deal structure: What was the total size of the deal?

Casey McDaniel: Yeah, so asking online, they were asking for $500,000. It looked good on paper. The only thing was they didn't have any company vehicles, and they were doing about $200K in earnings. So, they were asking about 2.5 times earnings. We came back and offered $445,000, and then they countered at $475,000. That's what we settled on, and we felt it was a fair price.

A lot of pest companies, I’m sure you’ve seen online, are going for crazy multiples right now—small companies for four, five, or six times earnings. There are some big ones going for, you know, 10 to 15 times, so we felt like we got a real fair deal.

As far as the structure, we knew we were going to need to buy some vehicles and invest a lot to get it up to our standards, so we wanted to keep as much cash on hand as possible. We did get an SBA loan, and there are two ways to get around putting down your 10%.

One, like you said, if it's an acquisition in your industry and within your same geography, then they can just consider it an expansion loan, and you can forego that 10%. The other way is if you get a seller financing note of 10%, and it's on standby for the first two years at least.

So, we tried to do both just to be sure. We told the bank, “Hey, this is an expansion,” but since it was four hours away, they weren’t sure if they would be able to swing that. We also convinced the sellers to do a two-year standby note, so they've got $50,000 that we don't have to make any payments on for the first two years.

And that’s what got us in with zero cash. On top of that, the bank approved $80,000 in working capital, so that gave us some extra reserves as well. We've got plenty of cash on hand right now to buy some vehicles, hire employees, move things around, do some marketing, and make sure that everything's good to go so we can service the loan and make some money.

The 10% is on standby for two years, and then after two years, we've got just normal seller note payments over the next five. That got us the deal, and we put zero dollars down, so it was pretty cool.

So, the purchase price was $475,000, with $50,000 on standby with the seller note that you don’t have to pay on in the first two years?

Austin Gray: Yeah, and then $80,000 of working capital, is that correct?

Casey McDaniel: Yeah, so you’re looking at a total loan of $505,000, and then they wrapped in their closing costs and, you know, their extra fees and whatnot, so I think the total loan was like $518,000 at the end of the day.

Austin Gray: Was that a surprise to you?

Casey McDaniel: It was a little bit because we didn’t know if we wanted that working capital or not. We figured, worst case, we’ll take it, we’ll hold on to it for a little bit, and we can just throw it right back at the loan.

Another cool thing we learned about SBA loans is that if you pay more than your minimum payment every quarter, they reamortize. It’s not like a mortgage on your home where it just takes years off the back end; they actually redo the numbers.

So, you still pay it till the end of the term, but your payment will go down. If we throw that $80,000 back at the loan next quarter, our payment will go down and down and down if we’re making extra payments.

So, it was a little surprising that they, one, approved us for that extra working capital and, two, that they just offered it willingly. It makes sense because they’re making money, but yeah, we took it, and it was a fine deal.

We ran all the numbers kind of based on worst-case scenario if we had to overpay for the business or things like that, and we could still make the numbers work. So, we were really happy with how the deal went.

Austin Gray: What bank did you use for financing?

Casey McDaniel: Yeah, so our broker connected us with a lender. It was First Bank of Indiana. I think they’re one of the bigger banks. When I look them up, they do quite a bit of SBA volume.

Austin Gray: And what were the terms of the loan?

Casey McDaniel: The terms, it’s a standard SBA loan. The rate was a little bit higher, but they told us that up front. They close most of their deals, and so it's a prime plus 2.75%. Currently, it's an 11.75% interest rate, and then that’s paid over 10 years.

Austin Gray: Okay, so can you break that down for us? You said that the business was doing roughly $200K in earnings. So, you acquire this business that says it’s making $200K to your bottom line. What do your monthly debt payments look like, and how does that play out regarding the cash flow?

Casey McDaniel: So, the monthly payments are about $7,200 a month, so that's going to eat up almost $100K just in debt service. That’s one reason they were able to get us approved.

Since we’re already taking a salary from our first branch, if this was the only company we bought, if this was our first time being business owners, and there was just me and my partner that had to live off this cash flow, they probably wouldn’t have said that it was enough because the cash flow based on the numbers we currently have is not super great.

So, we're buying it, pretty much servicing the debt. If we have a little bit left over, that's awesome. We're just going to use that to grow, pay off the loan quicker, and we’ve got sales reps already over in Colorado Springs. Since we closed, one sales rep has already put on 80 accounts, which is, you know, $50K in revenue, so we've already grown the company by 10% just in the last month. We’re not too worried about the payments or anything like that; we're mostly just using it as a platform so that as we have sales reps out there, we can add density around them and get those margins to increase.

Austin Gray: Was that a sales rep in the current business that you bought, or was that a sales rep you sent from your current team?

Casey McDaniel: Yeah, that was one from our current team. The company came with three technicians and one office person and just their equipment inventory. It did come with one vehicle, but it was mostly just a really expensive customer list.

One of our sales reps that we had been working with this summer—he's incredible—was a veteran. Grand Junction was just a little bit too small for him, so he was just chomping at the bit. As soon as we closed, he moved out there, and he’ll probably put on another $50K to $70K in revenue before the summer’s over.

So, we have three sales reps, one office person, and three technicians.

Austin Gray: So was the owner responsible for sales?

Casey McDaniel: Yeah, they had been around for 20 years. It was a couple that’s retiring. Their ad budget was pretty much zero; they had just grown super slowly. I mean, they’re obviously not a huge company after 20 years, but it was just a guy and his wife. They were making enough to be happy, they sold it, they retired, and they weren’t doing any advertising; they weren’t doing anything for sales. They had just grown by word of mouth for 20 years.

A lot of their customers are super solid and have been around for a long, long time, but they were not looking to grow the company. They didn't want any extra stress; they just wanted to manage it, cash flow a little bit, and then retire.

Austin Gray: So, what made you so compelled that this was the right acquisition from the standpoint of “Oh, they're not doing any ads, they're not doing any marketing?” Like, why were you so confident that this is a drop in the bucket? We should do this. I can grow this by doing what?

Casey McDaniel: Yeah, so with the way we grow door-to-door, you grow super, super fast, but you have a lot more attrition. Your cancellation rate is much higher; customers are not nearly as sticky. I mean, we do ethical door-to-door sales, but it is a pushier sale, and you’re going to have more people that have buyer’s remorse or decide later on they can’t afford it, and they end up cancelling.

Through any of the organic or normal ads we run, even like how this company has grown, those customers are much stickier. They’re only signing up if they call in and really need it; they’re not going to be doing it because the guy knocked on their door and, “Well, all the neighbors are doing it, so I better do it.”

So, with that, we knew their customer base was going to be as long as we can earn their loyalty; it should stick long-term with a much lower cancel rate. They were growing, even though very slowly, with no ads. So, we figured if we could just add a little bit of fuel to the fire, we could really grow it big.

If we come in and all these loyal customers for the last 20 years say, “Hey, our new company—they’re great; they’re doing things a lot differently; the service is way better,” and they tell some friends, then yeah, we’ve got a really good opportunity to grow it.

We're still in a pretty small market over there to where the competition isn't as bad as, you know, a bigger city like Denver, Salt Lake, or Boston.

Austin Gray: What type of ads are you running in Grand Junction?

Casey McDaniel: We’re running just Google LSA, Google Ads. We do a couple of Facebook ads a year using Angie leads—just, you know, fairly basic normal stuff. We tried the radio for a little bit, and it didn’t work out.

So, we’ll start dabbling. I heard a lot of people say Angie leads are horrible or to stay away from Thumbtack. In our market, sometimes those work really well. I hear a lot of guys that are just all over Facebook and have grown companies through Facebook, and we have not seen good success with Facebook at all.

So, we’ll get over there to Springs, and we’ll run a little bit of everything and see what’s working and what’s not, and then we’ll pour some money into what works. But, I mean, people ask all the time, like “Oh, what ads do I need to run? How does it work?” and it's like, play with it; see what works in your industry and your market, and dump money into it.

That’s what we’ll be doing.

Austin Gray: Have you found LSA to work the best in Grand Junction?

Casey McDaniel: Yeah, it works pretty well. We’ve got a pretty good closing rate on those, and our lead cost isn’t too bad. Again, I see on X all the time guys saying, “Oh, my cleaning company is too competitive; LSA ads went from $25 to 50 or 60 or 70 bucks.” Our costs are still under control, and there are not too many tire kickers, so it’s been working fairly well.

Austin Gray: It’s because everybody and their dog is starting a cleaning company, right?

Casey McDaniel: Right, you’ve picked a market that has not been blown up by X yet.

Austin Gray: Yeah, and it’s, you know, there’s a little barrier to entry. You’ve got to have a license, and you have to have a little bit more capital to hire W2 employees and vehicles and equipment and stuff. So, it’s not a horrible barrier to entry, but it's just enough to keep everybody from, you know, “Oh, I started a cleaning company for my mom, and now she’s making 10 grand a month,” and you don’t have that in pest control. So, it does keep it a little less competitive, which is nice.

Casey McDaniel: Yeah, definitely! I’m in 100% agreement there.

So, what do you do now? You closed, what did you say, July 14th?

Austin Gray: Yeah, so like my current schedule—what’s your strategy here? You had an office person, you had three technicians. What were the first three things you did post-acquisition?

Casey McDaniel: Yeah, so the very first thing we did was go down to the dealership and buy four new Ford Mavericks. We wanted to build some trust with the employees and bump morale up a little bit.

The couple was getting ready to retire, and the last year they had been super relaxed and just kind of let things start to fall apart. So, we came in, bought them some new trucks, and said, “Hey, we’re doing things different. We need you guys to stick around, but you're going to get treated a little better. Here are some perks,” so that was the first thing.

The next thing was just getting all of the information that I could that they wouldn’t give me during due diligence. I got all their old files, got access to their software, their website—just everything—so that I could actually see every little nook and cranny that they had been hiding.

Not necessarily hiding, but anything that I just wasn’t going to come across in due diligence. So, we got access to all that stuff, started looking at the customers, the revenue, everything that was going on.

After that, it was just kind of work as normal. We got our sales rep out there, so I went out for the first two weeks, and I was just spraying accounts, meeting the employees, meeting a few customers, and just kind of working as normal. It wasn’t anything too crazy—I was just out there knocking doors, spraying accounts, adding some revenue.

The last couple of weeks, mostly what we’ve been working on is transitioning from their software, which they use, GorillaDesk, over to what we use, which is FieldRoutes, and making sure that's implemented. We’re pulling over all the customer info correctly, training technicians on how to get that going, and next week we should be fully moved over to FieldRoutes, which will be a lot better and allow for a more seamless transition.

We haven’t told any customers yet, so we’re going to let them know next week as well. Once we're on our software, I guess that's when the fun begins because they don’t even know what's happened yet.

Austin Gray: Hopefully they don’t get the email and call in to cancel.

Casey McDaniel: I don’t think they will, man. I mean, as long as you’re just going to bring better service or treat them well, I don’t think they really care.

So, man, I’ll just encourage you to push through that, you know what I mean? Because you're doing something really cool.

Austin Gray: And you and Nolan—do you follow Nolan Gore on X? You're all about the Ford Mavericks.

Casey McDaniel: Yeah! So, in the past, the companies we worked for and what we started on, we used the Nissan NV200s. They've also got like the Ford Transit, and every brand had their little Sprinter vans, but in 2021 every maker stopped making them, and we’ve got a couple in our fleet. But you can’t buy them new, and all the used ones are getting some mileage.

We also realized that we’re expanding to where we’re getting up into some mountain towns now, and it’s Colorado, and it’s snowy. We probably need something with all-wheel drive or four-wheel drive.

So, we looked around and decided the Ford Mavericks are super cheap, get great gas mileage, we can buy them brand new and get great warranties on them. They make a version with all-wheel drive, so we got some camper shells slapped on there.

No, they're going to be huge for us. It’s probably the vehicle that I think a lot of tradesmen will be using in the future.

Austin Gray: What’s the purchase price on those right now?

Casey McDaniel: They’re the cheapest version. I mean, we got ours for like $32,000 apiece, brand new.

Austin Gray: And then how do you purchase those? Did you use your working capital cash, or did you finance those?

Casey McDaniel: We financed them. We went in, and I told them, “Hey, I've got a working capital loan to cover these, but the interest rate's not great, so I need you to beat it, or else I’ll just pay cash.”

They worked a little bit, and at first, they came back, and the first phone call I got from finance said, “Hey, we got you approved for these, and here’s the payment,” and he started talking about payment.

I said, “What’s the interest rate?” He said, “Oh, I can get you warranties on these,” and he kept avoiding the interest rate. I was like, “Dude, you have to tell me what the rate is.”

He said, “Oh yeah, well, it's not that bad; it’s 13.3%,” and I was like, “Yeah, all right dude, get out of here.”

I said, “Try again.” He went and tried again, and he came back with like 10.65. I said, “I mean, that’s not great, but it beats our working capital loan.”

I was like, “Is there anyone else I can talk to, though? We’re buying four of these, and surely there’s got to be a special deal.”

So, I talked to the GM, and he said, “Yeah, I'll get you in at 8.75%,” and I said, “Yeah, I like that.”

I don’t know if it was a dishonest car dealership or if they were trying to take advantage of me because I’m a young guy, or if that’s honestly the best rate that the lower guy could do.

But yeah, I talked to the GM, and we got 8.75%, and we financed all four of them.

Austin Gray: People who are listening, please take notes on that because that's like a master class as to how to just go and buy either a new or used car. Never buy from the salesman right off the bat.

Casey McDaniel: Right, you don’t have to buy. I literally just did some fleet changing too, and I love it that you just told him to try again because, up, I was like, “Hey, yeah, we've bought two other vehicles earlier this year, both around 10%, so I need you to try again.”

He kind of fumbled around, and then he did. The other part of that story I think you need to realize is if I didn’t have working capital, if I was in a position where I needed those trucks bad, and they had to do whatever, I probably would have just been like, “Hey, I’m glad you got me approved. Let’s do it.”

So, you know, if you have the guy who needs it the least, he’s the one that wins the negotiations. Since I had the working capital, I could tell him, “I mean, keep coming back until you’re below that.”

Same thing with this business—like it’s not something that we needed to buy. So, we gave him a lowball offer. You know, we offered like 12% or 13% less than they were asking.

So, if it’s something you have to have, you’re probably going to get a bad deal. But if you’re looking to buy something and you’re not in the desperate need of it, you’ve got a lot better leverage, and you’re going to get a lot better deal.

Austin Gray: I love that mindset! I agree 100%.

And in this economy that we’re moving into, I’m starting to see equipment move at better prices. I’m starting to see better deals on trucks.

Like I just got a like a one-owner '05 Cummins diesel, which I’ve looked for for probably a decade now. That thing just wasn’t for sale for a normal price over the last bull run because people were paying stupid money for good vehicles like that.

I’m starting to see better deals on vehicles on Facebook Marketplace, things like that, but you’re so right—the one who does not have to have it is the one who wins in negotiation.

So, you finance all your vehicles. That’s something I’ve been interested in recently, is like, what’s the strategy whenever you have to have these either vehicles or equipment?

Casey McDaniel: Yeah, so our first branch, I mean we’ve learned a ton. We started up in March 2022 and, two and a half years later, we first started off spraying out of our own personal vehicles. A few months later, we bought our first van, and it was a huge milestone. We were super pumped—we overpaid, got a bad interest rate. I mean, that was the worst thing we could have done, and we were pumped about it.

Since then, we’ve changed a lot of things. Our strategy now, now that we’ve got a little bit more money and more solid ground, is we just got these vehicles and we got the extended warranty: five, six years, 100,000 miles.

We’re going to drive these until the warranty is over, and then we’ll go ahead and trade them in. That way they’re always under warranty.

If we have to take them into the shop, we’ve got a backup vehicle we can get them in, but, you know, the shop shouldn’t cost us anything. The warranties were pretty cheap too, so that’s our game plan: just drive them under warranty.

As soon as we start to max those out, we trade them in, get some new ones, and just keep the ball rolling.

Have you looked into fleet leasing options?

Casey McDaniel: We haven’t, just because we’ve been small. But I’m learning a lot still, and I think that chatting with people is going to open a lot of doors to look into fleet leasing options.

When I was at the dealership, I asked, “Hey, we’re getting four; what’s the most you’ve ever sold?” He kind of, again, dodged around the question, and I said, “Well, it should be a number; you know, how many?” He said, “Well, usually if people are buying more than five or so, they can go directly to the manufacturer.”

I was like, “Hey, I’m going to cut you guys out next time.” I’d get a lot better deal if I don’t go through the dealership.

So, yeah, those are some options that if we are buying in bulk again, I’m really going to do some research, and I think we can get an even better deal going through a leasing program or Enterprise or directly through the manufacturer.

I’ve heard a couple of guys tell me to look into Enterprise Fleet Management. I just wanted to share this: I got off the phone with them, and we’re not big enough yet to leverage this, but at the point that you get to seven vehicles is when Enterprise Fleet will take you on.

So, anybody listening, it’s worth noting. I do know that several people—one specifically in the power washing industry, one specifically in the landscaping industry—like guys who grew really big businesses said, “Absolutely, no questions asked; that's the route we're going.”

So, like hearing that from those two guys made me look into it. Like I said, it doesn’t make sense for us right now, but I do believe it will be worth keeping a pulse on.

The first guy I worked for in pest control—that’s who they used; they went through Enterprise for fleet. So that’s always been in the back of my mind.

But yeah, we only had three vehicles until a couple weeks ago, so it’s like, ah, I mean we were just buying used vehicles and hoping for the best, so now that we’re getting a little bigger, we’ll look at the options.

But I have heard a lot of great things about the Enterprise Fleet program, so that’s something we’ll be looking into as things change. I mean, by the next time we’re going to trade these in, you know, that’s five years down the road; we could be in a totally different spot. Who knows what things will look like? Right now, I'm just trying to take it one day at a time.

Austin Gray: I hear you man! Well, keep me in the loop at the point that you all get to that point because I’m interested to know what kind of terms you’re getting.

Also, I think that’s like the beauty of this. You can build relationships with people in other industries and share sort of, you know, “Hey, here’s how they treated us in this industry; here’s what we’re paying on this type of truck.”

Ultimately, I think that’s how we all get better here, and that’s the power of this whole SMB network on X.

Casey McDaniel: Yeah, no, it’s cool. I just started tweeting last year just for fun, and I didn’t realize that my account would grow like it did or that I’d be having people DMing me, phone calling me saying, “Hey, I heard you on a podcast; hey, I saw you on a TikTok reel or Instagram, and you’re doing some really cool stuff. I’d like to chat.”

It’s opened a lot of doors with a lot of really cool people I’ve chatted with, so yeah, I think just like business—you know, just start doing it.

A lot of people are on the outside of Twitter and they’re like, “Oh, I don’t have anything to say, I don’t know what to tweet about,” and, “Oh, I want to start a business; I just don’t know what to do.”

Just start doing stuff! Just start doing stuff, and stuff will happen, and then you’ll learn, and you’ll get better at it, and then your Twitter account will grow; your business will grow. I mean, it’s just like anything else. If you’re just sitting on the sidelines, you’re just going to keep missing opportunities. If you get your feet wet, you’ll start to figure out the mistakes you’re making, and then you’ll do better.

It’s just cool when you’re doing stuff and growing; it’s super fun.

Austin Gray: Yeah, and it’s super fun to watch it too. I think a lot of people are starting to take notice. A couple of people have asked me about you.

It’s like, “Is pest control the best home service business model?” I mean, you know my answer; I obviously think it is, but I’m biased.

Casey McDaniel: Yes!

And I’m just excited to watch you grow this thing. It’s cool that you live in the same state that I live in, too.

Austin Gray: Yeah, it’s fun!

Casey McDaniel: So, one big wrench that we had—everything made sense, and we had asked how many recurring customers they have and, you know, their revenue, their average cost per contract, a lot of that sort of stuff.

We had assumed that all of them were on auto-pay. In reality, not as many were on credit card as we thought, and none of them were on auto-pay. They’ve got Gorilla, so they were having technicians go out and like strike using Square or PayPal in the field every single time, and they had PayPal and Square—not just one, not bringing over any payment information.

We’ve got all these customers, but we’re just going to hope that we can collect payments. So far, we haven’t had any issues, but a lot of them are using checks, and that was kind of mind-boggling.

That’s been the biggest surprise so far, and we were like, “How?”

It’s been hard work getting all of the credit cards from people, getting them to allow us to store them on file, be on auto-pay, and to be a smooth run. Otherwise, we’re going to start running into problems.

Austin Gray: Yeah, man, that’s a blindside for sure.

Casey McDaniel: Well, good luck with that one. You said one day at a time, right? Just keep eating the next problem.

What was something else that surprised you? They had been with the company for a long time, and so we figured they would be super buttoned up, really well-trained, really good at what they do.

When we showed up, they weren't trained very well, and it was just kind of an “everyone runs their own show” type deal. They were all using different products; they were all just kind of doing what they felt was best.

We ordered a bunch of inventory and put it in the office, and the guys were like, “Well, what’s this stuff? I don’t want to use that.”

We’re like, “Well, no, no, we have processes and procedures; you have to follow what we’re doing.” You can’t just go down and buy whatever product you want and then send me a receipt and we reimburse you.

We have inventory; you take it from the inventory room, and we pay for that.

It was a lot of just kind of doing whatever, and the first few days, these guys were just like, “Hey, here’s my Home Depot receipt. I need reimbursement,” and I was like, “I’ll do it this time, but don’t go back there. We don’t get stuff from there; we’ve got a supplier.”

So, yeah, it was them all kind of running their own show and not super buttoned up. The technicians do know a lot about the industry and how to get stuff done, but they were all kind of just completely doing it their own way, and there was no consistency and no procedures.

So, we had to kind of get them all in-house and say, “Hey, here are our employee handbooks, read it, follow it; this is how we do things.”

Austin Gray: Was there any pushback with that?

Casey McDaniel: Not so much pushback, but there was almost a sense of, like, “Should we trust you?” You know, I’ve been doing stuff my own way for several years; who are you to come in and just change it? So again, you know, getting the Mavericks and some perks, and saying, “Hey, here's some trust-building exercises. You guys need to trust us on this; we've been doing this for a while. These are the things that we need to use, and here’s how we’re going to do them.”

We didn’t have a ton of pushback, but I could kind of see them moving slowly. They didn’t just jump in to implement these new things.

So, it almost seemed like a little bit of distrust. Like, “I don’t know about this new equipment; I don’t know about these new products; are they really going to be as effective as what I’ve been doing?”

So, we’re really two weeks in, but they’re going to have to adapt; they don’t have a choice. They will either use what we do, or if they keep trying to submit receipts to Home Depot, we’re gonna have to sit them down and say, “Hey, we’re going to have to find someone else that does follow the rules.”

You know, it’s a highly regulated industry; the label is the law. If you’re not spraying according to what the label says, it’s a federal offense; we have to follow certain standards, and if they’re not doing those, then I can’t keep a guy around on my team that’s not following them.

Austin Gray: What is your plan with the office person who came along with that? Because don't you guys already have all your back office in-house?

Casey McDaniel: Yeah, so with the acquisition, we’ve got one person in Grand Junction who’s been with us. We need two, so we’re going to test it out and see how it goes having one person in each location.

Honestly, we’ve been upfront and transparent. We’re not sure if we’re going to be able to keep her around. We may have to let her go and get somebody in Grand Junction. That way, her whole office staff is together under one roof.

But if it works out and it is convenient to have one in each location just to handle some of that paperwork when checks come in and stuff like that, then we’ll go with it.

We told her up front, “Hey, we’re not quite sure how this is all going to work out. We’ll keep you on for as long as we can, and that might be forever, but it might end pretty shortly.”

We’re doing our best, and she’s still with us, but I told her I can’t guarantee that she always will be. We’re just trying to treat her fairly and let her know as soon as we can if it doesn’t work out.

But, yeah, once we get everything switched over to the software that we're on next week and we’re full steam ahead, then we will start looking at what actually makes sense.

Austin Gray: What does your office admin currently handle? What roles and responsibilities will those two people handle?

Casey McDaniel: They really run pretty much everything—answering any incoming calls for recurring customers that have problems; need to update their credit cards, need to reschedule; they take sales calls, anybody calling into the office that needs to get set up. They handle that, they run the billing for the day, they do the scheduling—pretty much anything that can be done on our software, they handle.

Austin Gray: Sweet! Well, this has been fun, Casey. Is there anything else that you’d like to share for people who are looking?

So let’s say another owner-operator has started a business in a specific industry. What would you like to share with them about acquisition as a growth strategy?

Casey McDaniel: Make sure you’re ready for it. Make sure that it really makes sense. I’m lucky I’ve got a great business partner who’s also active and involved. With this being in a separate location, one of us has to leave our family and go be there at times.

So, we’ve been kind of taking turns. If you’re a one-man show and you’re buying something somewhere else that can’t really be run remotely—or even if it can be—you’re going to be spending a lot of time there, and it’s a huge time commitment away from your family and stuff.

So just be sure you’re ready for that and that it’s really what you want to do. Acquisition is not something you have to do, and it’s really stressful taking on a personally guaranteed loan, having all this debt.

I’m not used to having debt. You know, a few years ago I didn’t have any, then I bought a house, and I was okay with that. Then we started financing a few vehicles and now we’ve got a bunch of vehicles and this loan.

So, it’s not something I’m used to; it’s really stressful. But if it is something that you’re ready for and you want to do, it makes sense, and the numbers are good, then absolutely do it.

Just take it one day at a time. You’re going to write down your to-do list—and I’ve got it over here, I’ve got 50 things that need to be done today, and there’s no way I get to them all.

So, I’ll just take it one thing at a time, bite it off into small chunks; do what I can do today, and then tomorrow I’ll do what I can do tomorrow. Don’t get overwhelmed. If it’s something that makes sense for you, just work as hard as you can, and it’ll be alright—the stress will go away.

Austin Gray: That’s awesome! Well, thanks for being on again, Casey, to share.

Casey McDaniel: Yeah, it was a pleasure! It’s always fun to get up early, do a little podcast, and share what I can. Sometimes, I mean, this is just what I’m doing every day, so a lot of it seems pretty mundane and boring.

I’m sure you would probably feel the same way about your business where you’re like “Oh yeah, I get up, I go to work, I come home; it’s not that big a deal.” But for a lot of people listening or reading tweets and stuff, they’re just eating it up.

This is the coolest thing that's ever happened, so I like to just get on and share my story as much as I can. Hopefully, it motivates someone to do something with their lives. That’s all I can really do.

Austin Gray: And you bring such a good perspective! I saw one of your posts the other day where you were like—along the lines of deep work or something like that—you were like, “Man, in the beginning of growing that company, like if you start from the ground up, there is no deep work.”

You just need to get out there, be with your team, earn their trust, do the things with them, and then just bite off the small tasks and do that day in and day out.

Casey McDaniel: Yeah, I mean, that’s my number one frustration with all these guys on X that are just like, “Oh, you know, start a company, hire a VA, hire someone to do the work, and then you can just work on the business and not in the business, and you can just get into your deep work zones.”

You can do all these higher-level tasks; the low-level tasks are for your wages and stuff, and I'm like, “Dude, when you start off, if you’re doing $200K in revenue your first year, there are no high-level tasks. Taking checks to the bank is not a high-level task, my guy!

Getting on QuickBooks and pretending like you’re doing anything there—that’s not high level—just wake up, work hard, go knock doors, go service accounts, go do what you need to do, and work hard alongside your team.

There’s no “Oh, I’ve got to get up at 4:30 and hit my cold plunge and then my sauna, and then I put on my headphones and that’s deep work time.” Like, what deep work—getting on your Wix website and uploading some different pictures?

That’s just go out and work hard; don’t be weird!

Austin Gray: I love it, man! I love it so much because, well, it’s just like—and I think that was the whole reason why I started this podcast—like one of the big reasons because I was just so frustrated seeing—and look, you know, there are plenty of people on here, whatever; I’ll say it because I’m not here to please everybody.

This is the OWNR OPS Podcast. It’s why I like hosting people like you because you’ve started from the ground up just like I have. We have that in common, and you know as well as I do—like in the early days, you literally just—it’s like, “Okay, I have this idea to start this business; what do I need to do?”

Well, I need customers, and why do I need customers? Because I need cash in the bank. How do you do that? You just go knock doors, right? You just go get your first job and do that!

But I just see this trend; it’s like—it's the same trend that I've seen in the past of like people convincing people that like, “Oh, you should start a software business” or “You should start a digital marketing agency” and you can work four hours.

I think that whole 4-Hour Work Week culture like ruined a whole generation of could-be entrepreneurs, and the reality is—like, I—like you are doing what is needed to go start any business, and I think we've lost that as a generation.

And so that was like the whole mission behind this podcast was to like share that if you want to start a business, especially at the local level, you just need to go do what Casey is doing.

Casey McDaniel: Yeah, no 100%! I mean, I watched my dad work 60 hours a week, 70 hours a week growing up, starting different businesses, and he’s finally at the point—he’s like 50 now, and he’s hands-off; he can work if he wants, and he likes to work, so that’s what he does, but he doesn’t have to.

If you’re trying to do this 4-hour work week, it’s no wonder your business isn’t successful! You’re never going to get there. You have to put in the work first, and then when you’re older, you can relax, work on those higher-level tasks, retire, do that stuff, but you’re 22 years old, dude.

You’re not going to make $250K from your computer and not ever work and have this business. That’s all mental masturbation. All of that sort of, you know, “Oh, if I just do this, then I’ll make all this money.”

You’re going to be in the weeds if you’re starting a business; you’re going to be out there probably not even with employees. You’re going to be the only guy doing it for a while. You’re going to be so lonely and so by yourself, and it’s just going to be hard work.

You don’t know if it’s going to pay off or not, and then finally, if you’re doing it right and working hard enough, it will start to pay off a little bit, then you can hire some people. But you’re still going to be in the weeds with them until you have several employees, and then you can kind of get yourself out of that.

But it’s not like you just hire one or two people, and then you’re just the big CEO of your company!

Austin Gray: Oh yeah, that drives me crazy! I’ll end my rant there.

Casey McDaniel: No, it’s fine! I like this rant; it literally gets behind the mission of this podcast.

And another thing that drives me crazy is don't use founder and CEO in your email title when you're starting a business, because you—like there’s no work for a CEO. You are literally, like, in the beginning, you’re like general laborer, you are salesman or saleswoman, and you are lead estimator, right? Like you’re all those things, but you’re not the CEO!

Casey McDaniel: Right, and I think that it’s an interesting perspective change. The super successful people—I’ve met a lot of really successful people that own their businesses or have done really really well in some of those sorts of things and you ask, “Oh hey, what do you do for work?”

Those guys that have actually made it, a lot of times they’re just like, “Oh, I’m you know, I’m an engineer,” or “I do landscaping,” and you’re like, “Okay.”

And you’re kind of like, “I’d like to dig deeper; what’s going on here?” And then you realize, “Oh, he’s the CEO of the largest engineering firm in Colorado,” or “Oh that guy has a $122 million landscaping company.”

Or sometimes you ask someone, “Hey what do you do?” “Oh, I own a pest control company,” and they want to act like a big shot, and I was like, “Oh, how’s that going?” “Oh, pretty good; it’s just me and my cousin.”

You’re like, “Oh, okay.” It seems like the better people do, the more humble they become, and their title goes all the way down to general laborer.

But the kid who just started up and is super cocky—he’s always like, “Oh, I founded this pressure washing company.”

You founded it? Like it’s just you; you started last week!

So, yeah, I think that the people that are the most humble and remove that title, oftentimes, are the ones that rise to the top, which is an interesting thing to look at.

Austin Gray: Man, it’s so true! It’s something I did want to address especially at the end of this podcast. It’s like Casey got to where he is right now because Casey literally was not too big or too good to go out and knock doors.

You started your business by knocking doors, and so I see so many people right now to your point it’s like—it’s just that mental masturbation; it’s just—it’s terrible! It's like people are literally just consuming this content of like, “Oh, I want to go buy this business.” Why? Because they think that it’s going to be this easy thing.

Like, “Oh yeah, I’m just going to go get an SBA loan, and I’m going to buy the business, and I’m going to have a GM in place, and they’re going to run the business, and yeah, I get the four-hour work week.”

It’s like—it’s no different than this whole entrepreneurship through acquisition movement on Twitter unless you’re like an experienced PE guy. There are people who have done it really, really well, but they have gone in with the same mindset: even if they’re going in to buy a business, like they go in to work in the business.

Like they are boots on the ground to grow it, and I just wanted to bring that up because I think it’s all about the mindset.

It’s like whether you start or whether you buy first, if your mindset is like, “I’m just going to be hands-off and pay somebody else to run this,” your chances of succeeding go way down. That thing is likely going to fail.

But if you go in with the mindset of, “I’m going to start this, and there is no failing,” or “I’m going to buy this, and I’m going to grow this thing,” then your chances of succeeding radically go up.

Once again, I love bringing you on because I think you're such a good example of what it’s like to do both, and it comes from the mindset behind it.

Casey McDaniel: Yeah, I’ve found hard work is the cure for a lot of business illnesses. I think you can cure a lot of stuff with just boots on the ground hard work.

So, that’s been our mentality, and that’s going to be our mentality till we’re done here.

Austin Gray: I love it! Well, thanks again for being on the OWNR OPS Podcast. And listeners, thanks again for listening!

If you are enjoying these episodes, please like and follow on Spotify and Apple. If you’re listening on YouTube, we’d love a like and subscribe.

And then just like building a service business, I can’t encourage this enough. If you’re building a local service business, go ask your customers for five-star Google reviews.

Just like doing that, I’m going to ask you guys if you haven’t left a review yet for the podcast—please take like 30 seconds and leave a five-star review if you are enjoying it.

Thanks again for listening! Don’t forget: work hard, do your best, never settle for less. We’ll see you guys in the next one!

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