Tommy Mello, founder of A1 Garage Door Service, shares his journey from massive debt to building a billion-dollar company. He discusses critical business lessons including the importance of systems, hiring for attitude over experience, and how he scaled from a local garage door business to a nationwide operation that sold for $570 million.
Create systems with multiple layers of checks and balances - most people create systems but never ensure they're being followed
Hire for attitude and hospitality first, then train technical skills - it's easier to teach someone who smiles to fix things than teach a mechanic to smile
Focus relentlessly on one core business before expanding - Tommy had to shut down 4 markets that were bleeding hundreds of thousands monthly
1:55:06Josh Stech, founder of LendingHome and Sundae, shares how he built a billion-dollar real estate lending company in just five years, scaling to 14% market share. He discusses the venture capital playbook, hiring at scale, maintaining culture with 500+ employees, and his transition to solving the property sourcing problem for investors through Sundae's marketplace model.
1:50:17Steve Trang interviews Damon Lyons of Sellers Advantage, who shares his journey from losing everything in the 2008 financial crisis to building a $30 million assignment fee business. Lyons discusses his evolution from loan officer to foreclosure auction specialist with Posted Properties, then to direct-to-consumer house buying, revealing the systems and massive marketing spend that enabled his California operation to dominate the market.
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Invest heavily in mentorship and consulting - Tommy paid $150,000 for Al Levy's guidance which transformed his $17M business into a systematic operation
Use equity incentive programs to retain top talent - Tommy gave $100M to 25 employees, creating 'golden handcuffs' that accelerated growth from $12M to $27.5M EBITDA
”“You are bleeding more than I've ever seen anybody bleed. You'll be at 18% of the bottom when you close as you close these four markets. You will be cash cow. Because you're leaking, there's some they're stealing from you. There's something bad going on. Close them down.”
”“Revenue is for vanity, profits for sanity. You think you're so good because you all this revenue, and you are probably one of the best firefighters I've ever met. But we're gonna need to sit down, and you're gonna need to shut up.”
”“I would have not listened to anybody, but this guy, the way he talked to me, the way he looked at me, the way he had the evidence, he goes, you are bleeding more than I've ever seen anybody bleed.”
”“Most people create a system, and they might have one checks and balances. I gotta check on top of that. Like, there is it's a business that runs straight off of systems, and I didn't have any of these.”
24191 words
Tommy Mello: Puts on his glasses and starts circling stuff. He's got a highlighter. He looks at me and he goes, you're three months from going out of business. He goes, look at me. You need to shut down these four markets today.
I'm telling you, I go, it's just a leadership issue, issue, dude. Like, I got this. We'll fix it. Shut them down today. I would have not listened to anybody, but this guy, the way he talked to me, the way he looked at me, the way he had the evidence, he goes, you are bleeding more than I've ever seen anybody bleed.
He goes, you'll be at 18% of the bond when you close as you close these four markets. You will be cash cow. Because you're leaking, there's some they're stealing from you. There's something bad going on. Close them down.
Steve Trang: Welcome, and thank you for joining us for today's episode of disruptors where millionaires are made. Today, we have Tommy Mello with a one garage doors, and Tommy is another Phoenix local. And today, he's here to share how he went from massive debt to building a billion dollar company, which is just crazy crazy to even say out loud. Guys, I wanna mention to create millionaires. The information on the show alone is enough to help you become a millionaire in the next five to seven years.
If you'll take consistent action, you'll become one. And before you jump in, if you wanna learn how real entrepreneurs, real entrepreneurs are building real empires, hit that subscribe button because every week we're dropping lessons that can help you create your first or your next million. And right now, you've got a 100,000 quarter mil, maybe even more sitting in your CRM right now, resurrect all your old and dead leads, with our objection proof AI calling agent text cash to the phone number 33777 to unlock the money that's just hanging out in your CRM. You ready? Yeah.
Let's rock. Man, so you've been on this complete rocket ship of a ride. I I can't remember. We met around '18 or '19.
Tommy: That is probably seven years ago. Yeah.
Steve: Yeah. Right? And we connected, I think, through, Danny and Jared. Yeah. We're both both in the show.
Danny Corral, Jared Vidalis is no longer Corral, but Jared and Danny. And I remember hearing about you. It's like, there's this guy we buy leads from. He's really good at leads. Yeah.
Right? And, and when I met you, it wasn't about the leads. It was like you had this garage thing.
Tommy: Yep.
Steve: But the craziest thing I remember the most from that was, like, let me show you, like, all these Christmas lights we have in the in this warehouse. Yeah.
Tommy: That's a funny story. Right?
Steve: And so what I'm thinking is, like, so what is this guy? Is he elites guy? Is he a Christmas lights guy? Is he a garage guy? And from that, like, experience to everything you've accomplished is just absolutely insane.
Let's talk about, like, what was your life like, right before you got into, like, entrepreneurship?
Tommy: Yeah. So, you know, my mom was a realtor. My dad owned a transmission shop. He didn't like to pay the IRS. So a lot of bills, a lot of arguments my mom and dad had when I was four years old.
I was standing on the toilet listening through the drywall, hearing them just arguing in their room about bills. And I just decided at four years old, I'm not gonna let this happen ever again to my future family. So they got a divorce when I was six, and, mom worked three jobs. And, I shovel snow and mowed lawns. We lived in Michigan, so I did whatever I could do.
By the time I was eight, I was just mowing lawns, shoveling snow, doing whatever I could.
Steve: On your on your own? This is just Yeah.
Tommy: Me and my buddy. My buddy, Elliot. We, Just eight year olds. We're just knocking on doors. Just if it snowed, we get $25.
We mow we shovel the snow, and then those snow customers became our lawn customers and vice versa. Yeah. And, I just remember back in the day when you used to have to pull off the printer, you know, they come out and they were all connected and you pull off. Mhmm. Like, we made flyers called, E and T lawn care and snow removal, and we passed them out.
And when I was 12, I got a job washing dishes a year before I was legally able to. $4.05 an hour. And that was, minimum wage back then, so I get paid under the table because you weren't able to work till you were 13. And I just had a really good work ethic. Like, I knew how to work hard.
If I wanted something, I hate asking mom. And so but, you know, at that point, 12 years old, starting to kinda hit puberty. My friends were starting to get into, like, marijuana. So when I was 16, I moved out to Phoenix. I finished up high school.
I was with my dad.
Steve: To get away from that?
Tommy: Kind of. You know, I knew I wanted that my sister was out here, my only sister. I wanted to go to ASU, and I just loved Arizona. I love visiting my dad. I needed a male figure.
He's a great dad. He went through his own trials, tribulations. But I was like, listen. The main thing for me was, like, survival. And then I was like, I'm gonna go to dental school.
And so I graduated a year early. I started it's kinda funny. I was bussing tables. When I was 16, my cousin, I got in his car, he goes, how much do you have in your Roth IRA? I go, dude, what's a Roth
Steve: IRA? 16.
Tommy: Yeah. I go, I don't know what that is. He goes, let's go start you one. He goes, how much can you afford to put into the to your month? I said, maybe a $100.
He goes, what would it take for you to get to $300? I go, I'd have to get a second job. So I got a lifeguarding job. So ever since I was 16, the minimum I put away was 300. By the time I was 20, I was maxing it out.
By the time I was 29, I made too much money to put any money in the Roth IRA. Now there is 900,000 in that Roth, which if nothing else went right, I still would have been a millionaire just based on the money I put in all of this. My cousin is a great guy. He's made a lot of money. He's a multi multimillionaire.
Steve: Old was he?
Tommy: He was ten years older than me, and he kinda laughs because he's like, when I told you to do that, I didn't even have a Roth IRA. So he got me set up. I trusted him. I looked up to him. Yeah.
And then, you know, I'm in my early twenties. I'm bartending. I'm buying and selling cars. And then all of a sudden, I'm watching TV and this Bowflex commercial comes on. And I'm like, I need to buy one of these.
This thing looks amazing. So I call up and they had low payments, but it was $2,400. Mhmm. So I go in the Arizona Republic, the newspaper, and I find a Bowflex. I call them up, and they were like, you're the twentieth person that called.
It's already sold. And my roommate's walking by at the time and goes, dude, have you ever heard of craigslist.com? And I go, Craigslist? No. So I go on Craigslist and I find some Bowflexes.
I go buy all of them. I bought five of them that day. And then I called Arizona Republic. I said, I wanna put an ad in. I'll buy two years.
And every day, I had an alert every time a Bowflex popped up. So I buy them for 3 to $5,700. I sell them for anywhere from 1,200 to 1,500 depending
Steve: on what flipping Bowflexes.
Tommy: So, yeah, I flip Bowflexes. I bought hundreds and hundreds and hundreds of Bowflexes. Wow. And then I found the total gym. I'm like, Bowflex sells itself.
They're doing all the marketing. Mhmm. I'm just an innocent bystander doing arbitrage, buying it here, selling it here. Mhmm. And then Chuck Norris was selling the the total gyms.
Mhmm. So I started making a ton of money doing that. Same thing with cars. I buy Honda Civics and g 20 Infiniti's. I bought 25 tires at a time for them.
First thing I do when I buy it, I detail it. I put new tires on it, change the oil. If there was any issues, my dad would help me fix it. I mean, these things look good when I was done. I mean, they were they were amazing.
And, I make $2 a car. And then at bartending, I made a lot of money. And at the same time, I used to do water conservation analysis. So I go to these massive commercial areas like the medical society, and I say, I could save you this much gallons of water per week, per month, per year. And I got all their accounts.
And so I'm bringing in, like, $50 a month in the landscape business. I'm bartending. I mean, I'm just the definition of a hustler. Yeah. And, my roommate at the time says, now I'm 23.
I'm doing all these things. By the way You're
Steve: 23 years old and you're doing all this?
Tommy: Yeah. And I'm that's and I'm going to school. And in the process of all that, I took anatomy, biology, biochemistry, organic chemistry, advanced calculus, pre dental. I enter in with a dentist. He goes, Tommy, he goes, I I'm 47 years old.
I owe $270,000, and I don't even own my own practice. He goes, I could see by the type of guy you are. I'd highly advise you go get the you go get your master's degree in business and learn business before you go into dental. Yeah. That was the best advice I ever got.
Steve: Incredible advice.
Tommy: And so I ended up getting an MBA that was later. But, my roommate was painting or he was a manager at a garage door company. And he goes, we can't find anybody responsible to paint garage doors. He goes, you do everything. He goes, you just figure shit out.
Steve: Literally. You're everything.
Tommy: Yeah. So he goes, would you be willing to paint our garage doors? I go, how many can you get me a week? He goes, five to seven. He goes, I can only get you a $100 a door.
And you gotta pay for the paint and the tape. So I I did some research. I went to Home Depot. I could buy Speedcoat. It's a Glidden product for $12.
The tape, the paint, and the, paper cost me roughly with gas to show up to the house about $20. So I hired this old man to teach me how to paint. I painted I paid him $300 to teach me per house. He taught me on 300.
Steve: You hired a mentor for painting.
Tommy: I hired a mentor. He taught me how to fan it on, showed me how to do everything, clean the painter. Went to Home Depot, bought a Magnum five painter. Every three months, I take that painter back and get a new one. And I went through the yellow book, and I went through a, b, c.
I called every single garage door company. I said, listen. I'm responsible. I'm a go getter. I warranty my work.
I'll never miss a project. I will take the time with the homeowner. You could count on me, and I'm only doing it for a $100. I'll supply out everything. And most garage door companies didn't have a good painter.
Like, they couldn't do colors like, if you're in an HOA, we'll match. Yeah. So I go pick up these they they grind out a little section, and I go do a paint match. And I got to the point where I was doing 10 door Saturday, 10 door Sunday, all my g 20 Infiniti. The magnum five fit right in the back, low gas.
I went on MapQuest, lined up all the jobs that I get at I go to Home Depot or Lowe's. They do a paint match. And, you know, I meet up with these technicians, and they back in 2005, you know, I met up with a guy. He's making $90 a year. And my other roommate ended up getting a job at this garage door company.
I'm talking to him every day. I'm like, let's go ahead and start a business. I'll handle the LLC. I could do the EIN number. 2007, we go start out.
They So you're you're
Steve: how many door you're calling all these companies? How many how many companies
Tommy: I picked up about 15 companies. One of them only gave me one job a month. Someone gave me a few jobs a week. Okay. And they were the big guys.
Steve: So you went from painting a bunch of doors for a bunch of companies to
Tommy: And I still kept that painting going for the first two years because I was making $2 minus basically 1,600 on a weekend, and I was done before 4PM. I just I started early. And, dude, this is it's pretty soothing. You're by yourself. You go hook it up.
You're driving, and you're just man, it's it's kinda fun. Actually, one of the videos I'm gonna do is we're gonna go paint another garage door. Like, how like, the roots of how I got into the I'm gonna go buy a magnum five. I go paint a few. So we gotta make sure we line that up.
But, so we we started this business right as the market started to shift in Phoenix and Vegas in the housing crisis. So now it's survival. By the way, I was not a good technician. We didn't have formal training. So I went to all the garage manufacturers.
I made them train me. The problem is my partner, he liked the bomb. I mean, he smoked weed a lot. Yeah. And in 2010, I just I started thinking, man, I can make this into something big, but I can't do it with him.
So he's my best friend, my roommate, and my business partner. It was like a divorce. Yeah. And I had this meeting. I said, listen, dude.
We've got a lot of debt. We're making decent money. We've got six full time employees, a couple ten ninety nines. I'll give you the business. You take the debt.
I'll go do my own thing or vice versa. I'll take on the debt. He goes, I wanna move to Montana. I'm gonna do go into the insurance business. He goes, this has been fun.
We're still best friends. You take the business.
Steve: You didn't see vision.
Tommy: There was no vision. I mean, we were barely getting by. We were we kept taking debt. We were in the yellow book. We got out of that in 2009, but we still had debt.
And then we were in Valpak. It wasn't you know, in the garage door industry, if you make it to a million, million and a half, you're doing pretty good.
Steve: So it wasn't this glorious thing
Tommy: No.
Steve: At the time?
Tommy: It was nothing. I mean, it was not the industry to be in. But, 2010, what do you do when you got no money? You can't trust anybody. People are stealing you.
You call mom. Yeah. So I called my mom and I said, hey. I need you. I don't you know, her best year, she sold 53 houses.
I mean, she was a she'd go out there and she'd not gone for sale by owner. She did whatever she had to do to make it work for me and my sister. So I said, I can't pay you a lot. $15.16 bucks an hour. I need you to help with phones, and I need my stepdad to help with payroll.
He could do door estimates, and he could help keep track of inventory. I'm gonna build this into a monster. And she's I'm asking my mom to leave everything she knows. She knows nothing in Arizona. She's got no family.
She's leaving all of her friends. Everything she's done. And she took two weeks. She called me up. She goes, we're gonna sell our house.
We're gonna move out there. Yeah. Crazy. But now I had trust. Yeah.
And my mom answered the phones, and she smile. My mom was amazing. She'd laugh. She'd go, oh, honey. I am so sorry.
She set me up for so much success. She goes, we're gonna send out Tommy Mello. Tommy Mello, such a good looking kid. She never says she's my mom. I was like, mom, well, so you're my mom, and I'm never gonna say you're my mom.
Yeah. And so I show up to the house. The clients would hug me.
Steve: Uh-huh.
Tommy: And they'd have lunch waiting for me.
Steve: Yeah.
Tommy: So I I've learned booking the call is important, but how you book the call. Right. Show empathy, set me up for success. And then 2014 so we're we're grinding. We got to about 6,000,000.
6 and a it was $6.06 and a half million, and I found this integrator. He was a friend of a friend. He just took a buyout from US Airways or America. I forget what company, but they merged. And he's like, I'm interested.
And I lived in a pretty nice house. It's off McDonald, the Granite Reef. He was impressed considering we were just 30. I had already went through my MBA, and this guy was smart. He had a finance degree, and I said, you're gonna be the bad cop.
I don't like firing people. I don't like messing around with software building the CRM. I don't like dealing with lawyers. I'm sales. I'm marketing.
I'm the trainer. I'm the visionary Mhmm. And I'm the culture. You do everything else. And so he works great with my mom and Bill.
We start building this company. 2017 was a really hard conversation because I said, the CRM sucks. He goes, the software is not gonna change the outcome. I go, yes. It will.
So there's this company called ServiceTitan. And I was just Massive company. Obsessed with ServiceTitan. Well, it was small in 2017. Okay.
And but I it was only for HVAC plumbing and electrical.
Steve: Oh.
Tommy: So I call them up and they're like, let's sign you up. And then they go, what's your email? And I gave them the garage door email, and they go, oh, you're in garage doors. Like, we don't we don't take on any garage door clients. We're we don't take on roofing, gutters, flooring, nothing.
We're HVAC plumbing, electrical. And I got rejection after rejection. I called a different sales rep, tried to talk him into it. Got a hold of the founder.
Steve: What was the reason behind that?
Tommy: They're very focused. So I got a hold of the founder on LinkedIn. He called me, and I'm like, listen. I'm your guy. He goes, Tommy, I'd love to, but my dad and my other founder, HVAC Plumbing Electrical, we're focused.
We're we're working on, like, the one thing. This is our industry. We're gonna really dominate. This is the way bigger industries. We got so many more clients to get.
We don't wanna be we don't wanna get distracted. You can appreciate that. I said, absolutely. You don't need a bunch of garage door companies. You only need me.
I'm gonna take over the industry. Yeah. And we talked for an hour, and he goes, dude, he goes, I don't I I don't know what to do. He goes, you're pretty convincing. Mhmm.
He's like I go, you bet you bet on me, we'll change service time forever. And he goes, he says, I'm gonna take a flyer. Yes. We're doing it. He sent out 10 success managers.
They only sent one out to a big HR company. He sent out 10. They worked with Adam and myself. I'll never forget this. And we built the CRM to work on garage doors.
The same year, I started a podcast. And the coolest thing about the podcast is if I was having problems with payroll, I find the number one person on the planet with payroll, and I'd get them on. And I just I literally asked them all selfish questions for my own business. Yeah. And then if I was having problems with hiring or HR or pricing or how to get vehicles or accelerated depreciation, whatever it was, I find the person.
I get them on the podcast. So it was like school for me. It was like consulting. And that same year, after my second podcast, I found the number one mentor I've ever had in my life, minus Jesus and my parents. I found Al Levy.
And he came into my office and he said, show me your manuals. Show me your standing opportunities.
Steve: From the podcast?
Tommy: It came from the podcast, my second one. Okay. We met up. I handed him my book. We were at lunch in Scottsdale.
He flipped through the book that I before I published it, he goes, this is garbage. This is no good. You need to rewrite it. Within two minutes of flipping through it. And I said, okay.
I mean, the he he at that time, he was 60 probably 66 years old, getting ready to retire, and he goes, I wanna come see your office. And he just tore me a new asshole. I mean, he's telling me you don't have any systems. Nothing's written down. There's no checklist.
He goes, you got all the answers in your head, Tommy. Right. But nothing's written down.
Steve: It probably resonates with a lot of people that are listening.
Tommy: Oh, man. Like, no expected outcome. So we were at $17,000,000, which was a huge accomplishment, but we weren't really keeping much. And he said, listen, Tom. Probably
Steve: also resonates with all people listening.
Tommy: He goes, revenue is for vanity, profits for sanity. Yeah. He goes, you you think you're so good because you all this revenue, and you are probably one of the best firefighters I've ever met. But we're gonna need to sit down, and you're gonna need to shut up. Turn off your cell phone, and we're gonna build the manuals.
Steve: We're gonna build met him.
Tommy: Yeah. No. He goes and by the way, he goes, just to get started, it's gonna be a 150,000. By the way, I didn't even have this money. I had to take an equity line against my house to pay him.
That was the best thing because I better listen to him. I'm paying money that I'm borrowing against my house to pay a guy. And, I mean, it was rough. But, man, we got through it, and we started creating systems and standard operating procedures and really a formal training center. That's his biggest thing.
He goes, I want to teach you how to bring in smart, strong people, but don't have any experience. He goes, forget all the leftovers of other companies that that were the rejects. Take great human beings, teach them the trade, teach them your way. And, I mean, he wrote the seven power contractors. So it was a trifecta.
Started the podcast, getting all the help, got on the right CRM. And by the way, the first year was 2017. I went to this big event called Pantheon. It was their first year. And I'm not very shy.
I go meet every $100,000,000 HVAC shop. And I went up to them. I smiled. They said, I'm such a big fan. I read your book.
Is there any way I could fly out? I'll buy everybody lunch. I'll buy you guys dinner. I will do whatever it takes. I'll come out there.
I won't be a nuisance, and I always brought an empty notebook. Yeah. And they all invited me out. They're like, yeah, kid. You could come out.
They're like, no problem. You're in the garage door industry, they start laughing. They're like, no problem. And I went on a $100,000,000 shop tour. Every single week, I was going on visiting, taking notes, asking questions.
CMO, CRO, CFO, just learning, learning about service agreements and learning about all these different things and how to use financing, which you never call it financing. You call it promotions.
Steve: Mhmm. And
Tommy: so I went to the elite of the elite elite, and I called r and d, rip off and duplicate. So I came out back with all these notes. We're killing it. And then of all of a sudden, we got the brand right. 2018, Al Levy's.
And he goes, your brand sucks. He goes, look at your raps. They're garbage. He goes, you need to go to Dan Antonelli with KickCharge.
Steve: Was it the same company name?
Tommy: It was a one garage door service. I wasn't gonna change that. Bad name. There's a lot of a ones. It's all first in the phone book.
It's where I came from. So now
Steve: But just the first impression is what you guys are talking about.
Tommy: Well, what's the brand? Like, Nike's got a brand. Right? So what did my brand say? If you look so he took a picture of my truck, black and white.
He goes, springs, doors, cables, openers, new doors. It had triple a, BBB, Yelp, and Angie's List on it. It had a phone number and a website and a picture of a funky garage door and my face with
Steve: a Everything thrown on it.
Tommy: Yeah. And he goes, Tommy, I want you to call Dan Antonelli with KickCharge. He goes, he's the best branded guy in the world. Get on the phone with Dan Antonelli, and I'm trying to negotiate. And he goes, I don't negotiate.
He goes, it's $35,000. Like, $35,000? And what I realized was this is the future of the business. So I'm 30,000,000 now, and I'm about to rebrand. And we rebranded, and Dan and I worked, and every yard sign matched the truck.
My signature on my email matched. Every mailer matched. We had cohesiveness. We came with a black shirt. I used to have every color of the rainbow.
Now it's only black. It doesn't get dirty and grease on it. He's washed a million times. They stay the same color. No.
I
Steve: say it's the same one that
Tommy: I got. So this is it. So now I'm the right brand. Now I've got the right CRM. I got the right consultants.
Now I'm hiring consultants. Every 30 podcasts I do, I'm hiring one of the people. It just I didn't plan on that, but that's kind of the ratio. Now I'm at 500 on the home service expert podcast. And I still hiring from the podcast, and I'm getting great guests all
Steve: the time. Yeah.
Tommy: So I'm literally learning. I'm still speaking at events. I'm reading like crazy. In 2007, this guy handed me the CPA. He goes, as I'm just getting into business, he goes, I like you, kid.
He goes, I think you're gonna do well. I only work with $10,000,000 plus net worth. He goes, but I'm gonna coach you for free. He goes, what's the last book you read? I said, To Kill a Mockingbird.
He goes, what what else? I go, Lord of the Flies. He's like, so you haven't read since you got out of high school? I'm like, no. He's like, this is called the E Myth revisited.
This is the foundation. This is the franchise model. You you inspect what you expect, and you have the outcomes you want. I read that book. I came back in three days.
He says, read this book. It's called The Ultimate Sales Machine by Chet Holmes.
Steve: That's a good one.
Tommy: Read that in three days. Then I read the richest man of Babylon. By that time, I'm hooked. I became an avid reader.
Steve: Yeah.
Tommy: So I'm reading through the process. 20 now I got I got the right and then all of a sudden
Steve: Before you continue, what I'm hearing, like, over and over again is massive action, but also consistent. It's just consistently doing massive action.
Tommy: This is what I'm a decision and I ran and I failed. I we haven't even talked about the failures. But I'm talking there were so many days that I didn't know how I'm gonna pay my tax bill. There were times we got a bridge loan to move into a new building, and the SBA turned us down. And the bank was and I was like and I just remember this day that Adam looks at me and he goes, I don't know what we're gonna do, man.
And, like, I'm a fight or flight. Like, I run a failure. But what's really cool the best story is I got a guy named Jim Leslie who runs the Home Service Freedom Group. I got a guy named Dan Miller. Dan Miller brought on the right CFO.
Dan became the president. We built the HR team. We built the finance team, the FP and A team, the stuff I knew nothing about. Most home service and improvement companies, they like, now we got a perfect balance sheet. We got the accounts receivable down to nothing.
We collect on demand. We figured out all these little things that they brought. We understand what arbitrage meant. We understand what the the North Star what
Steve: what was the reason. Doing when you're doing both Lexus. You were just arbitraging.
Tommy: But I didn't know you could buy a company for 5 x and sell it for 17 if you bring it in. Like, I didn't understand those things.
Steve: Right.
Tommy: So when you put systems and you make a large bottom line EBITDA ratio and so 2022, we decided we're gonna sell the business. I sold half of the business. We ended up selling for 570,000,000, and I rolled half of it. A 100,000,000 went to 25 people. They had equity incentive.
So they had Phantom Equity. Mhmm. So a 100,000,000 went to them. I got a couple 100,000,000. The rest of it, I rolled.
So I own 48%.
Steve: And then we're 20 '2.
Tommy: That's the 2022. Last year, we did 315,000,000. We did north of 80.
Steve: So bottom. This, lot of incredible stuff here. One thing I wanna dive deeper real quick is, was it Al Levy, you said?
Tommy: Al Levy.
Steve: Al Levy. He said, we're gonna build a training center so good people can come through. So you don't have to settle for who you got. Only quality people come in.
Tommy: You train them from the foundation. You hire on attitude. I want them to smile, shake your hand, look in your eyes. Now my role is I work for you. I buy from you.
My grandma would buy from you. Mhmm. And I go have a beer with you because you're interesting, you're funny, and you keep a cover you could tell a great story.
Steve: Right.
Tommy: So it's the who not how, getting the right people on the bus. Now I spend way more time marketing than the people I want on my team than they do with clients. My top producer will do 2,000,000. My bottom guy will do 500,000. Take more time, then you get way more $2,000,000 people.
Steve: So I guess the first thing, we'll talk about how you bring them in. And then next, we'll talk about, like, the actual training protocol. So what are you doing right now to attract? Because, like, obviously, now now that you're at this level, it's probably a lot easier to attract quality talent. But when you were hustling, weren't sure when you were gonna be able to make payroll by a different, attraction of who you could bring in.
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Tommy: Yeah. So in the early days, I mean, it was not good. I mean, there there was some times where if you had a, if you could fog a mirror, you were hired.
Steve: Right.
Tommy: If you would just show up the first day. And then I as the company started growing, I started to have a really, really high expectation Mhmm. Of who came in. And right now, if you go on Glassdoor, I'm the only CEO with a higher rating than the CEO of Glassdoor. That's incredible.
So Glassdoor, there's ZipRecruiter. There's all these different places. And now my social media is not great. I got a 140 some odd thousand on Instagram. But I've I I spent a lot of time building my personal brand because they're coming to work with me.
Right. So the founder it's more important for the founder to market themselves than it is for the company because they're just saying I wanna work with Tommy Mello. Yeah. So we we put out a lot of ads. We put out a lot of TV radio, but we make a recruiting ad that it sounds great to the client as well.
Like, you know, we're looking for great human beings with a lot of manners that wanna do well in life. We give all the benefits because we're gonna treat our clients right. You know, if you're looking and you you like to talk to people, like to fix stuff, and what we changed in the last two years instead of going after somebody that's like a mechanic and fixes stuff, we go after somebody from hospitality and teach them how to be a mechanic. We used to find the mechanic and try to teach them hospitality. Big mistake.
Find somebody that already smiles, like a shoot the shit that literally asks great questions, and then you could teach them. The garage doors aren't super complicated. It's not like rebuilding an engine. So that was a big But that makes total sense, though.
Steve: Like, when you're hustling and grinding on the way up, it makes sense to hire someone that has the skills and, like, hey. Can you just smile when you talk to them?
Tommy: Yeah. But they don't like to smile. They're like, I just like to fix stuff. Well, half the battle is you're going out there meeting a client at their home. You gotta play with the dog.
You gotta ask great questions. You gotta well, manners. You gotta diagnose the person before the problem. I mean, I've read over 500 sales books. Like, this is what I do.
I give options to my clients. So I say, Steven, here's the thing. Here's what we could do, and you go, Tommy, that's more than I wanna spend. Well, let's just choose another option. I got five options for you.
Let's see something that fits for you and your family. And I'm here to earn your business. I want you to be a client for life. I want you to store my number. And if you ever need anything, I'm gonna be out of here for you.
Yeah. My dad taught me you can do three things in business. You can do the best quality, best technicians, best warranty. You could do it on their schedule. You need me today, I'll be out there today.
Or you could be the cheapest. You pick two out of the three years that you get. You'll never be all three. And I'm not saying I don't have affordable pricing because I do. I have contractor pricing.
I got what any other garage door could do company. I'll give you the same thing for a better price, but I also got far better value. We've got trademark parts. Our springs are 80,000 cycles. The average company has 10,000 cycle.
So we trademarked our parts, not meaning that other people could get similar parts. But I wanted to sell oranges when everybody's selling apples.
Steve: Yeah. So talk to me about, this machine. Like, this it's not a school. It was it sounds like a factory. Like, so you take people in, put the right people in.
What do you do and to train them properly? Because the that's I think, people is the hardest part to get right. Finding them, getting them skilled up. So what are you doing to ensure you got this, what's the word I'm looking for?
Tommy: It's, Expected outcome of performance?
Steve: Yeah. It's, conveyor belt. You got this conveyor belt putting putting quality people in, and then now you got trained quality people coming out.
Tommy: Well, okay. So there's three things we train on. Technical, operational, and sales. Yeah. By the way, to sell as human.
Daniel Pink wrote a book. Be a good human being, smile more. The the if you go to church, the pastor's selling you to give tithing of 10% of what you make. Right. Like, everybody's in sales whether you like it or not.
Yeah. The day you meet your future wife or husband, you're in sales. You're smiling. You're opening the door. You're giving her flowers.
Like, sales is a part of every day. If you get your son to make his bed, a few weeks up that sales. So people just look at sales as this negative thing, so you gotta you gotta explain it a little bit differently. We're just trying to do the right thing for the client. Yeah.
And so sales is probably the hardest part of this, but we've got 20 training doors. We take them apart. We put them back together. We've got service tied. We've got we live in this, like a it's not the cert so so they could play around with it.
It's a dev environment where they could go play around and build tickets.
Steve: Yeah.
Tommy: We've got quizzes, and they've gotta put stuff up. And a lot of it's role play. So we got a kitchen and a living room. Because that's the best place. Is there a spot where you can go sit down, go over some options?
I wanna be in your house. I wanna be comfortable. I don't wanna be in a 130 degree garage. Yeah. And then we got scorecards for every department.
And the scorecards turn into the one on ones. And the one on ones, we're just trying to make you change one thing. Then it's a will or skill. We record every conversation. We've got a software in the garage that records all of our conversations.
It tells me that I say the same amount of words per per minute as you did Mhmm. That I match your tone, that I shut up after I ask you a question. We got an eight step process, and it's a machine. And if you do it right, then we offer coffee on the way. Yeah.
I we've got all these things so I could listen to the call, the whole sales call. And right now, we're building this unbelievable system that the software inspects five of the calls. And next week on your one on one, we say, did you get the thing done we needed to do? And if you listen and you do everything we do within ninety days, you'll be a million dollar producer. But you gotta have the will.
You gotta want it. You gotta be able to smile and say, I believe this is the best thing for me and my family. So instead of saying you make more revenue for the company, we talk about what are your goals, what are your dreams. I need to understand what you want in life. Then I say, listen.
You wanted to buy a house in two years. If you do what I tell you, you could buy it in fourteen months. What's in it for you? Right. So we gotta really figure out.
And if you don't dream big, you're not gonna be on our team.
Steve: So I love that point, because, like, one of the, the founders of, Priceline, that's one of his things. Like, he only had one interview question. What's your epic life goal? If you don't have one, then he doesn't want you at the company. Right?
Like, if you don't have a big dream, like, forget it. This is not the company for you.
Tommy: A lot of people are like, man, if I got a roof over my head and a warm plate of food, I'm good. That's you know? Because you're gonna make great money when you work for us, and You're gonna get raving fans. And customers are gonna hug you, and they're gonna say no other company we've ever had our home treated with this kind of respect. They took care of it.
They were comprehensive. They gave us options. They cleaned up after themselves. We're gonna take out the garbage. We might even mow your lawn.
A guy mowed the lawn the other day. We wanna go above and beyond. One thing that's, like, way out of our hemisphere to go above and beyond for our clients. Not to mention, Robert Chedini is a buddy of mine, wrote wrote the book influence. He's like, offer something on the way.
Pick him up a cup of coffee. Yeah. Reciprocity. And there's seven rules of influence, and we're trying to focus on all seven of those in the process.
Steve: Yeah. So, this is all, again, the last few years. And I was just bringing back earlier, you know, like, when we met, you were kinda, like, doing a little bit of everything. The hustle. The hustle.
So this is before Al Levy then.
Tommy: Al Levy was working with me. So what happened was as we're selling the real estate leads, like, if there's one thing I know how to do is market and get clients. And then when I applied that towards getting great people on the team, that's when everything changed. But, my buddy, Dustin, is like the SEO guru of the century. Like, there's nobody that could outdo him when it comes to ranking on Google.
And, I asked him, hey. Do you wanna go to China with me? We're gonna go to Hong Kong, Macau, Shenzhen, and and one other place I forget the name of. And he's like, yeah. I'll go.
And my other buddy just started a Christmas business, Christmas lights. Mhmm. So we went there, and the guy that owns the garage door manufacturing plant, his best friend owns the largest Christmas light distribute distribution center in the world. And we're buying these things for three boxes set. I mean, that we're selling for 20.
So we bought, like, $200,000 of Christmas lights. The problem was they weren't the ones that are gonna last forever. They were like we didn't know it at the time, but they're not made to be used every single year on houses. And so we started this business. That business today, I got out of it because I felt like we were gonna get sued.
We were doing stuff OSHA violations. Violations. We weren't all insured properly. I'm like, I'm a target for you guys. Give me back the money I invested.
They're bringing in $500,000 each a year. It's very seasonal. They're very successful, and the business is worth a lot of money now. So that that business is doing amazing. But that was just a distraction.
One of the things, Gary Keller wrote, the one thing, is if you could really I wrote a book called the first book was the home service millionaire, and I'm talking to my buddy Dave. And I go, I like to put my eggs in a lot of baskets. Like, dude, what if a basket falls? Like, I still got backups. Like, I I could earn income from all these different things.
He goes, what if you put all your eggs in one basket? It would fill up. It would grow abundant. So now after I got a couple $100,000,000, I started a family office. Now we're making investments, but I don't run any of them.
I hire great people to run those other businesses and great investments and do the quality of earnings and really know I mean, every one of the investments I think there's one that didn't go well. But out of the 25 things we invested in, they're all shooting up. And a one I mean, look. A one's tripled since the day we sold it. Yeah.
It's more I
Steve: wanna I'll so we'll continue that part later on. We talked about, like, you know, all the wins. And, again, like, the thing that I I hear is just this drive, and I'm I'm gonna go for it. There's a dog in you, and it's not gonna stop.
Tommy: Never stops. I'm driven.
Steve: I mean,
Tommy: it doesn't stop. You might think that you you you reached the finish line and you made all this money. It doesn't stop. It's almost like there's something and it's not something I'm proud of, but the goal the goal post moves. All of a sudden, like, you could tell me I'm worth 10,000,000,000.
And I'd say, okay. That's great. What do we do tomorrow? Right. Like, I'm never satisfied like, I'll say this.
When we accomplish a huge goal, I'm proud of my team, but I'm never satisfied. Yeah. And, that that's it's not a good thing because it's not easy to work around a guy like me.
Steve: Well, the way I've described this before is, like, people are very driven. I kinda put myself as categories. Right? It's like Bill Belichick. Right?
You win
Tommy: the Super Bowl, you crack
Steve: a smile, and then tomorrow you're right back at it. Right? Or Michael Jordan is like, what time are we working out tomorrow? Right?
Tommy: Yeah. So Tom Brady.
Steve: So where I wanna go with this is lot of success. It seemed like overnight, but that's just on the outside looking in. But clearly, there was a lot of going into it. Let's talk about, like, those few times where, you know, you almost burned a company down. What are some what are some of the craziest things or some some of the things you did is, like, I can't believe I put us in this situation.
Tommy: Yeah. So I started to get a little overzealous, and I started to pop up new markets. Dallas, Houston, Atlanta, Tampa. And I still had Detroit, Milwaukee, Vegas, Albuquerque, Portland. I mean, I was everywhere.
And I'm going bam bam bam bam.
Steve: So you like, I I figured it out in Phoenix. I can do this anywhere.
Tommy: And Tucson was easy. Two hours away. It was hard to go to Tucson, and then I went to Milwaukee because that's where my sister lives. I spent a lot of time there. And I had a lot of success, then I went to Vegas, had a lot of success there.
Really good hiring. And that that was just luck of the draw. That was like rolling the dice and I landed on a good person. Well, I have a really smart buddy. He was doing over well over 100,000,000.
He comes into town, and he I lay out my financials. And he's, like, brilliant when it comes to p and l balance sheet income statement. And he puts on his glasses. He starts circling stuff. He's got a highlighter, and he looks at me, and he goes, you're three months from going out of business.
He goes, look at me. You need to shut down these four markets today. And I'm telling you, I go, it's just a leadership issue, dude. Like, I got this. We'll fix it.
He goes, shut them down today. And I'm telling you, other than JC coming down, I would have not listened to anybody. But this guy, the way he talked to me, the way he looked at me, the way he had the evidence, he goes, you are bleeding more than I've ever seen anybody bleed. Because you'll be at 18% of the bottom if you close these four markets. You will be a cash cow.
He goes, you're leaking. There's some they're stealing from you. There's something bad going on. Offer a relocation package for the technicians of those markets and close them down. The next day, they were closed.
Steve: So how many markets were you in at this this moment? I think I was in
Tommy: probably 14. We're in 37 now. I had to close four of those.
Steve: So four of them. Which markets?
Tommy: Atlanta, Houston, Dallas, and Tampa.
Steve: Okay. A little overzealous. And you said that did you figure out what happened?
Tommy: Well, there's a stripper living at the Dallas, location, really bad manager.
Steve: She was the manager? No.
Tommy: No. No. She was talking to the manager I had had. I didn't have checks and balances. The systems we have today, I've been to hundreds and hundreds of home service companies.
The data controls the checks and balances. We check the system with checks. Like, most people create a system, and they might have one checks and balances. I gotta check on top of that. Like, there is it's a business that runs straight off of systems, and I didn't have any of these.
I was running in the dark expecting people to do the right thing. And not to mention, those markets are like, if you think about it, Houston's a really so I was gonna take out of Houston. Yeah. I should have been able to take on a little piece of Houston, like the North Part of Houston or even, like, a tinier part of that. I was like, dude, my shit doesn't stink.
We're We're going over taking all of Houston. We're taking all of Dallas. So I'm spraying and praying because it worked in Detroit. It worked in Milwaukee. It worked in Vegas, but it took years to get there.
I tried to do everything in a year that took me five years in these other markets.
Steve: When was this?
Tommy: When I had to close them down, it was, like, 2018.
Steve: 2018. Okay. And then, like, 2017, you opened them?
Tommy: It was, like, a year, year and a half depending on the market.
Steve: Alright. So your buddy says, Tommy, like, now now is the time. Not end of the year No.
Tommy: You said, dude, you do this, like and he he the way he looked at me, the way he talked to me,
Steve: it was like Was life or death?
Tommy: Yeah. That feeling. And I was like, I swear. I'm talking even if Val Levy would have said to do it, I would have said no. Yeah.
But the way he looked at me, the way he talked to me, I mean, it was like a divine thing because I was like, alright. Alright.
Steve: So you go. You you let them all know, hey. This is shutting down. Whoever wants to reload. How was that?
Did you have those conversations? Because you were saying you had you hired a bad guy.
Tommy: Yeah. No. We we all did. I mean, I had to own that one. And I said, guys, we're we're literally losing so much money.
I'll pay you guys. And at the time, it wasn't enough money. I think I gave him $7,500 to relocate. I think I had about five guys relocate to other markets.
Steve: How many people did you have to let go?
Tommy: So the you know, they they weren't really big markets, so there was about 30 people total.
Steve: So, but the next day, just ripped the Band
Tommy: Aid off. Ripped it off, closed the doors. I mean, it wasn't easy. I sold some of the phone numbers, didn't come out ahead much. But the good news is
Steve: Do you have to guarantee any of those, like, leases? Or
Tommy: Unfortunately, those leases were back then, it was easy to get a year lease. So, yeah, I was still paying, but I I was pretty good about getting no more than a $2,000 lease. They weren't massive buildings. Right. So there were some things that I had to fulfill, but, we started to wrap that up, and all of a sudden, man, I looked at the bank account.
It's, like, jumping.
Steve: How much were you losing in those four month four markets?
Tommy: I mean, it was hundreds of thousands of dollars a month. Hundreds? Yeah. Well, you gotta think the marketing, and then I'm paying workers' comp. I'm paying for rents.
I'm buying trucks. I needed insurance for these people. Like, you gotta a lot of people think, man, if you're a technician, you say, these are the parts. Here's what we charge the customer. What's the difference?
Yeah. They don't see all these other things, the lawyers you gotta hire, the e mod score, the workers' comp, the truck payments, the insurance. We're running 22 different softwares today. They each cost money. I mean, I got cameras in every vehicle.
I know if you go for a cigarette. I know if you get on a cell phone. I know if you roll through a stop sign. I mean, I know everything. Mhmm.
I mean, because the software the service type did along with all these other softwares is they allowed me to scale without being there. Yeah. Because now I I've got and by the way, I don't try to, like, catch people doing something wrong. I try to make it sure they're safe for themselves and everybody around them. Yeah.
And the systems like McDonald's has you hit these five digits, a little bit of soap comes out. Mhmm. That's your employee number. They make sure you wash your hands each hour. Yeah.
It's not like they're they're assholes. They're just trying to make sure the food is clean and that you're cleaning your hands.
Steve: Yeah. There's a point. I don't know exactly when in my company. We went from like, hey. I need you to do this, to, like, hey.
The company needs this. Because if you don't do this, you're actually jeopardizing everyone else at the company. Right.
Tommy: I don't
Steve: know exactly when that happened, but I know we have that conversation now versus before Tommy, I need you to do this. I was like, hey, Tommy. Like, if you don't do this, like, you're not thinking about everyone else at the company here.
Tommy: Yeah. You're only as strong as your weakest link. So the job for me now is I sit I I would say I live on Mars, and I'm looking at Earth, which is the company. I'm looking for volcanoes and earthquakes and just thunderstorms, and and my job is to swoop in. But I'm also creating the vision of what this company looks like in three years.
Yeah. And I'm also setting the stage for the culture, and I'm also the CMO. So everything in marketing reports up to me. Everything in recruiting is up to me. And I'm also involved heavily my COO was a genius.
My CFO was, like, amazing. My FP and A person, like, we've got an amazing team. Way smarter than I am at their exact like, they're they came in to do this specialty, and they're the best at it. And we pay for the best. They all have equity.
They all are sprinting towards the finish line. And, you know, my job is to dream this thing huge. And private equity, it's not it's not an easy game. You can't just sell your business and expect to work less. They expect you to work more.
Yeah. They expect to get results. They got limited partners, teachers, unions. They got, you you know, the fire department, all these different people that invested in their fund. So they're they're on every week, they're under a lot of scrutiny to get results too.
Don't just think, like, the private equity is a bunch of rich guys trying to get rich. They take in on investments from people that depend on them. Right. Well
Steve: and then, well, I definitely wanna talk about this some more later on. I but, like, you bring up a good point here because, like, there's a lot of, like, right now hate on these, VC firms, these private equity that are buying all these houses. And they hate it. Like, all these rich people are buying houses, but, like, all these rich people are buying houses are teachers' unions. Yeah.
Or they're employee unions. So it's like, are you sure you're hating the right person? Because it's teachers that are investing in these in these companies.
Tommy: Well, they you know, what it is is victim mentality. They can't keep up. They're gonna say they're gonna outpay me. They're gonna get more rent. They're gonna they're willing to lose money.
The fact is you just can't compete. You got every reason in the world to think about how you're gonna fail. The thing is it's gonna raise your standard and you're not capable. You know, a lot of people say, I wish I had your life. My answer to that is you would have quit a long time ago.
You wouldn't I see you. There's no chance you could've made it through. Yeah. The hard times are what, you know, forged what we have today. And I see these people.
All they do online, they have nothing to be satisfied for. I live in The United States Of America. I have no pain in my body. My parents are still doing great. There are 7.8, probably, right around 8,000,000,000 people that would trade for me.
Yeah. Like and by the way, I didn't choose to get born in The United States, but I got freedom. Like and these people find a reason. You know what's going on? And all I hear is these politics in Minnesota, what's going on now in Ukraine, and and everything going on in Trump or whatever Biden.
And I'm like, what if what if he just focused on what you had control of? Like, can you go work out? Can you go for a walk? Can you not eat that that that bread sandwich? Can you stop drinking a 12 pack a night?
Could you literally, like, smile and tell people how much you appreciate them? Like, I see these people go through life. They're never gonna be happy. They'll find the worst in any situation.
Steve: Yeah.
Tommy: And those are people I don't even wanna be around. And by by the way, I hang out with people I have a common future with instead of a common past. Yeah.
Steve: I wanna go back to the checks for the checks. Right? Like, you know, when you were saying this, I I kinda go back to, like, I think it was, like, Buster Rams. You know? So I would just basically I got lawyers.
I got lawyers. I oversee those lawyers. Yeah. Right? Like, you tell them the checks and then the checks on top of that.
Explain to me what that is, like, the checks and balance and then the additional layer of checks and balance.
Tommy: So I'll give you an example. My FP and a team and finance team controller, the the CFO checks their work. Mhmm. Then we got a big four auditor that checks their work. And the auditor, we've got bankers that look to make sure there that everything's on point.
So there's, like, always a layer, and it's always an independent layer. Mhmm. Inventory, a third party checks everything. That that's what's really really important is is the checker of the checker. And like I said, I think one of my biggest things is, remember, most people don't even create a system.
A lot of people work on creating a system, but they actually created the wrong system. And the third one's the big one. They created a really great system, but the system's never being followed. Right. And there's no way to know it's being followed.
If I wanted to put out an a frame, which is just a big sign in the road when we're working on a job, Little bit not in the middle of the road, but you see that we're working there. Yeah. How could I ensure that every technician did it? They gotta take a picture in front of the house and it's geo. It's, you know, basically,
Steve: geotagged,
Tommy: geotagged that I know that it was at that property. Mhmm. You know, we take pictures of every sticker. And what I realized when I called service time in 2019, I said, you guys allow my technicians to upload a sticker. I found a technician with the five same pictures.
It's the same exact but he put one on one house and kept uploading the picture. So I said, eliminate the bill ability to upload.
Steve: So these are the kind
Tommy: of things I'm thinking through. I'm always looking to say what's wrong with this system. Mhmm. What's broken, and how are we not making sure it's being performed? I'm working on something that, actually, Cameron Harrell talks a lot about.
Yeah. It's parking. Like, I got these massive vans, these driving billboards. Find the best area we get the most work from. And when the guys have two days off, park them at the Costco and the Home Depot where it's lit up and there's a lot of foot traffic.
Mhmm. Well, there's a lot of things. You could get the catalytic converter stolen. You get it broken into as your insurance set up for that. So what does my team do?
They came up for every reason why we can't. Mhmm. And I'm like, let's talk about every reason we should. Let's at least try it in a market for three months. And these are the kind of things, like and it's hard now because we're a big company.
We got lawyers. My CFO is very, very precautious. He wants to make sure we're never gonna do anything. We got all this stuff now with, you know, data integrity and and compliance and information. So, I mean, you should see to come out as a vendor for me, you go better like, your people have to have background check.
Like, all these things. And here's what I hate about it is I realize it's for a good purpose. Like, if if they were to hack my system and shut us down for two days, we lose 2 and a half million dollars. Yeah. So you gotta, like, cross your t's dot your i's.
But, man, when I was a speedboat, I could run, I think, so much quicker. So that's what makes it that's why the small guy could catch up to the bigger guys because you're working on compliance and talking to lawyers for three months, and the other guys already did it, and they're they're speeding past you.
Steve: And they're they're you're in the rearview mirror.
Tommy: That's it.
Steve: Yeah. Alright. So let's talk about, were there other instances where, like, you got you put the company into a mess because, like, you're a hard charger. Right? Any other things you've done, like, why did we do this?
Tommy: You know, there was there was a lot of things I did. I thought I could just whip up into another industry, like like garage storage or garage flooring. And this is before what you need is you need to hire somebody that understands how to run that industry. You don't need good workers. They know how to apply garage epoxy or polyaspartic.
You need somebody that knows how to run that business. And so at least I learned to try things in one market, but we've tried a lot of things and it just ended up being a waste of time. Yeah. In the future, I'm just gonna buy a really big company that's doing, like, 3,000,000 of EBITDA, 4,000,000 in the market. I wanna make sure they got the systems.
They're killing it in one market, and I wanna say, we run 25,000 new houses a month fulfilled. That's not leads. That's ran jobs. Mhmm. We have one thing.
It doubles our EBITDA. So the future of this business is to find out more things to fulfill. But yeah, man. Look. I'll tell you this.
If you talk to the main people, the c suite, the leaders at our company, they'd be like, we fail. We run towards failure. They'll be like, man, we fall down all the time. Yeah. Tommy asked us to try things that'll never work.
But at least we try it. We learn from it. We go try it again. And sometimes we're like, Edison, it took us a 100 tries and now we got it. But at least we took the shot.
Everyone else is, like, sitting there, like, in procrastination and indecision, and they they're like, well, we're just not ready. And I'm like, guys, what would it take for us to be ready next week? Do you need a million dollars? Do you need to hire more people? Like, never come to me with a no.
So, I mean, look. I've made a lot of mistakes. I don't think there's a whole lot that almost put put the company out of business because we started making great money. But I'll tell you, like, I think just the ability to stay focused. You know, race horses wear blinders Mhmm.
So they could focus on winning the race. Yeah. I was looking every which way but forward. I was like, where are all the answers and I would the ADHD would kick in. So now I'm just like, this is working.
And the private equity company has taught me a lot about discipline. Yeah. Don't buy new construction companies, garage door companies. Don't buy if they do Home Depot, Lowe's, and Costco. Don't buy, commercial where they do docks, levers, rolling still.
You are a pit bull at this. Keep going. And so, yeah, they've taught me a lot.
Steve: So, we got to catch up your event in Vegas. Yeah. Right? And, while we were there, first, I gotta say, the fact that you had, Flo Rida just do your show was absolutely insane. Yeah.
Like, I thought this was gonna be like, okay. Like, you know, Tommy paid for this guy. He's gonna come out and say hello. I was like, you legit had a concert. Yeah.
It was insane. That's fun. Yeah. But the other thing too was, I got a chance, you know, we're as we're hanging out, overheard you talk to someone else. And there was like, hey, Tommy.
I've got this idea. You know, I've got this, you know, we we we install florist, but, like, we're gonna do this other thing also. And you just nipped it in the butt. You're like, no. You're not doing any other things.
Like, this is what you guys are doing good at. You guys started last year. You're doing 1,000,000 a a month already in revenue. What the hell are you talking about?
Tommy: It's the average entrepreneur that just thinks we're gonna just and the problem is the guys in flooring, they say we're gonna open up a showroom. We're gonna start doing commercial. We're gonna start wholesaling. And then I would ask them, I know which guys you're talking about, and I'd ask them, show me the p and l. Where's the profit coming from?
They still can't give you the answers. And they wonder where the money goes. It's like somebody's they almost think like but they don't understand the systems. And when you get good at one thing, the the greatest news is when something goes so well and you really are patient, you take two steps back to take three steps forward. You do this correctly.
Eventually, you've got the team. Let me tell you the best thing I've ever heard. Steve Bezos early on at Amazon. This is probably the best lesson anybody needs to learn is he hired these amazing consultants that came on Amazon. And he Jeff goes, I wanna go whiteboard a few ideas.
And the guy looks at me, he goes, Jeff, if you whiteboard for thirty minutes, you put this company into bankruptcy. We're not ready for those ideas. So here's what you're gonna do, Jeff. I want you to put every idea in a filing system, and I want you to give us the ideas as a level of importance when we're ready. And I want you to think about building a company that you could give every idea you think of because the company could handle it.
The infrastructure is there. And when I heard that, I'm like, that's me. You go through my if I showed you my cell phone or different files of the things, and that's why my team gets, they're like, we're not ready for that. And a lot of times I push, but now we're we're ruthlessly prioritized. We got our big 10.
We're like, what's gonna be the best way to do this? But there's small things in the process, and I always go, could I hire somebody as a $10.99 consultant to handle this? Yeah. Because then it's outside of our scope a little bit more.
Steve: Well, you bring that up. It's so I just had our annual planning. Right? My coach was here, like, Friday last week, so five days ago. And we gave her, like, here are all the things that we wanna do in 2026.
And she's like, well, you can't do all of them. So which we're gonna do? It's like, I wanna do all of them. And it was painful. But at the end, we all agreed that I had to take these things off.
It was very painful.
Tommy: It's the hardest thing for guys like us and women like us that literally have these massive dreams. But I don't ever wanna lose the ability to dream big and wanna do a lot. It's just we need people around us to question us and say Right. What's more important? Mhmm.
And I mean, I've got this three times this week. Today's a Friday. Three different people have asked me which one of these do you want us to slow down on if you want this. Three different people. And they've learned and by the way, I'm so glad they learned to ask that question.
Mhmm. Because I need to hear that. I need to hear look. We're only it's a big team, but but do you want us to slow down on this and shift our focus? Because the owner and the founder are usually the ones that become the bottleneck of the company.
So I try to stay the hell out of their way.
Steve: It's such a good question. So, like, is I I've taught this to everyone that works with me. It's that alright. Everyone's got three priorities. Anytime I ask you something and you don't see how it works, you say, okay.
Which of these three properties priorities would you like me to start working on? And at this point, you you didn't say no. Yeah. You put the decision back on me.
Tommy: Yeah. No. That's that's great.
Steve: It's like, okay. Well, shoot. Alright. Well, no. Those three are more important.
This idea that I was really excited about, like, I had while we're, you know, having lunch, that's not as important. Those are the other three things that we agreed was more important.
Tommy: But here's a little secret that you need to understand. I started working with Dan Martel. And he got on the call with my team, and he said, what what what you need to know about Tommy is he needs to feel heard. It needs to be written down, and it needs to make it onto the calendar. Doesn't mean you have to hit that.
You can't just say we're not gonna think about it. It doesn't get stuck. Like, he just needs to know he's appreciated. It got written down. It went on to the project board, and you guys see the value, and you talk through it with them.
Mhmm. And there might be 80 things a week most likely, not that many because there could be. Mhmm. But there just needs to be a process to work through these things. Yeah.
And the quicker you can work through those things but I'll wake up in the middle of the night and go, I asked about that three months ago. I still don't have it. Did they forget about me? Now my personnel is way different than most of theirs. They think I forget.
Like, that's the thing is, like, it just comes back like, where is that? What's that?
Steve: Happened to that thing? Yeah.
Tommy: And that's what we are. That that's who we are, and I've had to submit. I've had to submit because I've had to say we're gonna move a little slower, a little more calculated than I'd like to. Right.
Steve: But we're still gonna get there. The other thing too so we had Dan. Actually, he came out of my office about a year ago and, like, had a great session. We talked a lot of different things. Gave some wonderful advice.
And now, we're probably gonna be signing up for his, software as a science, program, SAS Academy, because we transitioned from, like, a sales training organization to basically AI sales organization. Deliver software now. Completely different company. Right? Because, like, in coaching, it's like, alright.
You paid. Make sure you're here on Tuesday and Wednesday next week.
Tommy: Yep.
Steve: Now it's like you paid. Great. How do I make sure you're happy for the rest of your life? Right?
Tommy: Right. It's a
Steve: completely different model. So we're gonna be, signing up for his coaching program. So going back to now, you sold you said in '22, half your company.
Tommy: Mhmm.
Steve: Right? And you said for how much? It's 540. 140. Took a 100 and divvy it up with 25 people in your company.
Absolutely amazing. I mean, how did that feel? That's gotta be
Tommy: Well, let let me tell you the the the the preface of this. When I found out how equity incentive programs work, I was 12,000,000 of EBITDA. Within nineteen months of dishing all these out, we got the right people on the bus that attracted them, created what they call golden handcuffs. They had a stake in the outcome, and we ran in nineteen months to 27 and a half million. So I've done the whiteboard.
I've done the math. I would have been on a mountain by myself with 15,000,000 sold. I put a opened a bottle of Magna by myself and poured myself, and everybody would have quit. Now I got lifelong partners. Yeah.
We've changed their life. They work for this. By the way, I didn't give it to them. They they've earned it. Yeah.
And I got to see people living their dreams, going on dream vacations, watching them buy their first house or a nice house, and invite me and say, hey. We did this together. And now I get to see it again. Now I got technicians with equity and installers with equity. So it's the best thing on the planet.
And once you do it, you're like, how do we do more of this? And by the way, the most important thing is you'll get you to go way faster. So you might say, I don't you you don't wanna be like this, like like in dumb and dumber. There you go. There you go.
Like equity. You wanna be very careful. And it's the way that equity works is there's two triggers, time over vesting Mhmm. Or it could be performance. Usually, it's a five year vesting period.
What's cool about it is, let's say, you're worth 10,000,000 today Mhmm. And you wanna give your CFO 2%. You get to a 100,000,000 valuation. So you got 90,000,000 variance. They're only making money on that 90.
They're getting the 1,800,000.0 on the 90. That when they come in, they get nothing from what's got done in the past. It's only future. Mhmm. So it's not like they gotta work for it, and they still got a vest.
So it's a pretty plus, they're not doing profit units. They you know, there's not a formal k one they get issued. Like, they they don't get any operating decisions. The change of controls when they get paid. Right.
But the most important thing if you're gonna dish out equity or phantom equity or EIP, your profit units, is you better have a target. Because if you came and work for me and I said, hey. You're gonna be my COO. I wanna get you 2%. You say, okay.
When do what is this? When do we go? Like, what's our target? And I'll say no. Don't worry about that.
Never. As long as I'm getting paid, we're good. You know? If you show up, you work hard. You know?
You saw my Ferrari out there. Maybe I'll buy a new one next year. So you gotta have a target of where you're going.
Steve: Yeah. That makes a little sense. But going back to the question, what was it like when you saw like, when you were able to wire
Tommy: I don't know. I'll tell you this. They didn't believe it. I mean, you when I had over $200,000,000 show up in my Goldman account, it was on Christmas Eve. And because they have to wait a month, anything over a $100,000,000 takes thirty days.
It goes through, like, this federal thing. Yeah. And the money showed up. And I called my guy Goldman, and I go, I can never spend this much money. He goes, oh, you will.
He goes, I know you. And he doesn't know I'm gonna go blow it in Vegas or something. He goes, I know you're like, he goes, you you'll figure out a way. And he's right. And these people, they're like are telling you, like, the tears and just but, man, if you haven't been through a process of that size, they do background checks.
They go on and see how many bank accounts you have. They call every ex employee. I mean, I lost some of my hair. I got alopecia through the process because it's like you're under a they're talking about, like, what happened when you were 16. You know?
You got in a fight. Like, they're going into, like they're checking everything. They're looking for high school records.
Steve: What?
Tommy: Like, they're just trying to see your character. Like, what's gonna happen? Are you a man of of integrity or woman of integrity? Like, they're going they we spent $600,000 just to do a study about our industry. So, like, if you're gonna plan on doing that, just, like, you you wanna come up for air, and then you're, like, you're going back into the game now with this new now you gotta get not not expect to come back in, not clock in, but, like, now we gotta figure out how we're gonna work together on the next deal.
Mhmm. And that's usually six months. And then it's like, now you gotta sprint again. And the minute you do not perform to your expectations of the budget you put out, you're giving them control to come in and ask a million questions. And now they're gonna start to say, are you a good leader?
But and if you say, listen. I'm gonna get us out of this. They'll probably give you ninety days. And then they're saying because they're under scrutiny every week by their LPs. What's going on?
So you gotta understand where it's coming from. But it's, luckily, we've been on a tear. I think we've got just an amazing team, and we've never had a down week, down month, down quarter.
Steve: You were saying earlier, you learn a lot of lessons private equity. What were some of the biggest lessons that you
Tommy: if you if you wanna try something, try it in one market, prove it out for three months, and then we'll try it in three before you go company wide. What they did is they handed us about 40 different financial metrics they want. And they said you 40. 40 pages worth. And they said, we want you to recreate this within the company.
That was the FP and A. There was some operations. There was some in the call center, some in the dispatch, but they said, we're giving you this because this is what we're used to looking at. Every single company they invest in, instead of making it, like, it's it's all the same, so they could go through it. These guys are magicians.
They go through here, they circle stuff, and they ask for four hours a month. They ask amazing questions. They try to figure out, well, why this? And have you guys thought about this? They don't tell us what to do.
They're not operators. And our deck now is a 170 pages, and they never told us to add one. We add to it and say, we wanna keep an eye on this. We're gonna put this into the deck. Sometimes I'm like, let's not add it to the deck because it's not where it needs to be, and they're just gonna scrutinize it.
But but also we're very transparent. I call them for every major decision. But what I loved about it, they said, hey. They sat down with the whole team, and they said, Tommy Mello is the only one that calls the shots. We don't call the shots.
If you ever come to us or try to go behind his back, the answer is no. If you want a major decision, a hiring decision, or go into a market or a price decision, Tommy is the one that you're gonna go to. And I love that. They didn't try to like, that was, like, the most important thing, and I felt like I had more control than I had ever in the business. And they tried.
Like, there's certain guys that went around my back and that would call me up and go, we told them to ask you. That's never gonna happen. It's all gonna be through you. By the way, what does that mean for them? That I have complete accountability.
That I could never say, well, like, they made sure that if we were winning or losing or indifferent or breaking even, it was gonna be on my shoulders, which I loved it. But other people would be like, well, the team no. No. No. It's all through me.
Like, I'm making the big calls. Yeah.
Steve: One thing that you were saying earlier is that you're really good at generating leads, really good at marketing, and then the the switch flipped. You're good at marketing to people. Yep. So talk talk more about how you're marketing.
Tommy: So one of the biggest things was getting the brand right, getting influencers, showcasing. We started interviewing wives. Like, let me give you a good example. Like, one of my top technicians, his wife said, when Justin started at a one I'm just gonna be candid. He wasn't a great father before.
He wasn't showing up for our family. We didn't own a home. We lived in an apartment. We didn't get to go on any vacations. We've got full insurance.
I always knew my husband was capable. They pulled it out of him. We live in a beautiful house. Here's our Can Am. These are my kids.
He's their soccer coach now. A one gave us an opportunity. Now my husband worked hard, and he's a good guy. But he had a dead end job, and he didn't see it, and I helped pull him out of this. Well, how many women do you think out there their husbands are awesome, but they're loyal to their and they don't know there's anything else out there better.
Because if you're on the unemployment line, well, it's not you're not great unless you're moving there. So my job is to find people that already have a great job, that are already great people to see a better position within us. The other thing is endorsements. Like, did you hear you can make 6 figures your first year working at day one? These guys, they treat you right.
You you you gotta go influence your marketing. Like, you got everything half of your brain needs to go towards how do I market to the perfect avatar of where I'm going? So who first of all, you gotta define your avatar. Like, if you're in real estate, you're saying I'm gonna go after Paradise Valley, Gilbert, Chandler, and Sun City. Like, no.
You wanna pick if you're going after the ultimate affluent client, you gotta know how to deal with those clients. Mhmm. You're gonna go after Sun City, they get old people. They deal differently. You know?
They're probably still answering their phone. They might even get a text message or an email. You know? There there there's you gotta understand what an a player looks like. You gotta reverse engineer what they're interested in.
Like, what are they listening to? My guys are listening to AM Sports. Mhmm. So if you're gonna do ads, you wanna figure out what are the music they listen to? What are they interested in?
And if you understand that, like, you've heard of bottle blonde. Like, I walked into my my buddy Charlie runs bottle blonde. It's like, how could I get the girls that work there that are their influencers, they're, like, pretty girls. I gotta get them to post. Like, say, listen.
I know a guy that's making this much money. You know, the 25 to 35 year olds are watch like, they are watching. They're locked into her. Yeah. And they're going, yeah.
Like, those are the ideas that I keep. Like, it's my guys go to Topgolf. Like, that's where they're gonna be at. I'm on the displays. Like, how do you do stuff like that?
Constantly getting in front of them. But the displays, they're also seeing impression of a one so they become clients too. It's not like it's not bad for my clients. It's also showing up. Yeah.
Movie theaters. Is it the right movie that I get in a theater of, like, what is my avatar going to watch move like, they're not going to watch, you know, Forrest Gump probably. I couldn't think of any new move new release, but but they're they're gonna be watched, like, every 25 to 35 year old. Now will I take a 45 year old? Absolutely.
Will I take a they gotta have insurance for three years and drive for three years. I tend to want them to already be over drinking age because we all know when you're 21, things change a little bit. Mhmm. And, you know, you think about this, the average plumber is 47 years old right now. So I'm trying to bring any you know, get them and create them lifelong to where they wanna work for us for a long time.
Plus, I got a path to get them out of the truck.
Steve: You talked a lot about investing in mentoring, personal development.
Tommy: Oh, all the time. Lots and lots of money. More money than most people make in their lifetime.
Steve: I was gonna that was gonna be my question. You had to estimate how much you put into personal development, or would you or would you, peg it out?
Tommy: Well, this year is 2,000,000.
Steve: This year? Yeah.
Tommy: Already. Like, it's it's going budget. The payments for yeah.
Steve: It's budget.
Tommy: Yeah. 2,000,000 this year. Wow. I probably you know, you know, it goes more every year. Probably 6,000,000 so far, and I'd I'd probably say I will never not be working with two to three coaches at a time, but I tend to try to extract in six months to a year 80% of it Mhmm.
And then move on. Unless I'm just there's magic. But like I said, I'm there. I go to certain coaches knowing exactly what I want. I'm more with Ed and my lead, and we're doing great things.
We're working on, like, how he's like, you don't need to be out on a 100 podcast for your book. You need to be on 12. I'm gonna help you with this, this, this. And he goes, if you love what I do but what I love about him is he goes, dude, you got everything. Like, you work out.
You've made your money. You're a success. He goes, most of the people I work with, they're trying to become somebody. You're just frightened about what you did. He's like, this is gonna be fun because he goes, I work with Alex Schmose.
He wears a Band Aid over his nose and shows up in, you know, t shirts and tank tops. He's like, you speak okay. You know? He goes, but Alex makes way more content. He's like, so there's some things we're gonna have to do, but he's like, this is gonna be fun.
Mhmm. So, like like, you know, Patrick with David, you know, I try to work with the best of the best, and I'm always going after one thing. Like, it's not just like, hey. Here's my blank slate. Where do you wanna take me?
It's like, this is the next step. But I do think your personal brand matters because you can't you you don't sell that. Like, Tiger Woods sold his golf likeness to Nike, but he didn't sell who he was. He still came out with other things. You know what I mean?
Yeah.
Steve: So you said you was it you tripled? So you you you've, when you sold in '22 to where you are today, how much have you grown?
Tommy: 27 times three is it. Yeah. Just just over three x.
Steve: So you're already doing a lot. And, like, it's easier to go from, like, one to 10. Right? Or or, you know, like, 10 to to 30. But to go to where you to a 100 to 300, like Yeah.
You have to make big changes. It's not like, hey. Let's make this little shift here. Let's make those like, what are some of the things that have helped propel you?
Tommy: Well, we started using Power BI and started building data lakes and started bringing in AI. They started using AI call center software. Like I said, we're we're a software company that does garage doors now. I plus I got buying power. Mhmm.
So I was able to renegotiate with every one of my vendors. And I got I'm gonna spend $80,000,000 in garage doors this year. That's my cost.
Steve: $160,000,000.
Tommy: So they treat me with a lot of respect. Like, I'm very important. Like, they're not gonna have their bonus when they lose us. Like, we're a massive client, and I've always got two vendors. I always want two doing the same thing that I could kinda like, who's gonna treat me better?
And there's, plus after what COVID happened, somebody has something, somebody doesn't. So I'm I'm kind of making sure that I'm keeping them honest. But, you know, it's probably gonna be easier for me to go from 300,000,000 to a billion than it is for most people to go from 10 to 30. Why? Because now I go into a new market.
I got 40 page greenfield plan. I mean, going into a new market. Like, every single time I go to a new market, I learn, like, 10 things. And so we're going into three new markets this year. By next year, we'll go into a new market every month.
And not to mention, we're taking right now a $3,000,000 EBITDA market, and we're gonna make it five. So all the other markets are growing. And when if I'm in your house, right now, we're at 70% of our jobs are through finance. This year, we're shooting for 35%. We've got tools to make it more convincing to wanna use financing.
And when you qualify and I say, Steve, you got $35,000 here. The garage door is gonna run you, we'll just say $6 or whatever, how much per month. Would you like us to take care of the floors and the mini split? That way you could set up a gym in here. So we're we're about ready next year to start introducing, like I said, only one market.
Mhmm. Flush it out. Make sure it's dialed in. Create all the systems. And the model that we set up is I only got 21 guys that could sell doors.
They all work from their house. They got three computers. So we turn it over to these guys. These are like the magicians of garage doors. They're the gods of garage doors.
Like, you can see what's in stock. They could build a house before and after. You know, every finance promotion we got going on. So we turn it over. So these guys I only gotta train 21 guys how to sell the new product.
We all we gotta do is turn it over.
Steve: 21 guys is 300,000,000.
Tommy: So these guys are only selling doors. Doors are 40%. So they do 40% of 300 they do about a 125,000,000
Steve: just to those 20 guys. Still crazy numbers.
Tommy: It is. My top guy did 8,000,000 last year as a product specialist.
Steve: So you're saying it's easier to just go in, because you're coming in with everything ready to go. You're you're you're you're the big dog the moment you walk into that town.
Tommy: Well, no. It takes about a year of branding. I mean, you gotta spend a lot of money, TV, radio, billboards. You gotta spend a lot of money. You gotta make it look like that you've been there for ten years.
Well, if you go in there with guns blazing like I do, all of a sudden, a lot of the small guys wanna sell to you because they're like, we don't wanna mess with you. Well, that was my best choice. Companies. You're doing add ons and bolt ons in there as well. Yeah.
And that's one thing is, like, on this next deal that I go into, I wanna be like, we spent a lot of money. I wanna double it. The easiest way to double it is just to double my average ticket and double my profit because that cuts my common half. Spend the same amount of money. So if I added one thing, it was able to double my average ticket, double my profitability.
My comm, let's just say, aggressively is 14% I wanna spend of revenue. If I double my tickets, keep it at 14%, I'll go in there and own the mark. Like, I'm on every single geofence, like, every single programmatic, like, you you like, every single flyer you get, I'm at every event. And I by the way, I'm learning a lot from the home improvement space, like Anderson Renewal. Like, I studied those guys.
Steve: So at which point, I know you were, acquired, like, a PE firm you're working with. Are you basically, like, some sort of hybrid? Like, you're well, you're a software company, you're a garage company, and then you're also, like, a PE firm. You're just acquiring other companies too.
Tommy: So they own my garage door likeness. I buy a lot of companies that are garage doors under a one, and then I got the family office that invests in other things. Mhmm. And the way I worked it out with the guys is if I create a software, a one gets it for free forever. Yeah.
Now if I go send in a bunch of clients, a one benefits because most of the money I get goes into for development. They're like, sure. That's fine. Now if you wanna know where I'm at, almost all the time is a one. You You wanna know why I create the software so a one wins.
Steve: Mhmm.
Tommy: So, like, if it doesn't exist, I'm like, let's go build it. And I'm like, by the way, once we build it I mean, we've got the number one podcast of all of home service home improvement. I'll tell people this is what I made to make my company better. I'll show it to them. I'll I'll I'll guarantee them it works because that's how a one shows the results.
They come do shop tours and everything. I don't I don't build these Look. Obviously, my main goal is to grow a one. And the byproduct, if I get to 10,000,000 ARR or another thing, and it's got a 10 x, great. It's a $100,000,000.
But if you think about how much I got in a one right now, you do some quick math. I mean, it's worth $1,700,000,000. Yeah. So I'm not gonna rob Peter to pay Paul. I'm gonna build this to make this machine work better.
And then I got a team that could go do that and we'll do fine, and we'll four develop the product which makes a one even stronger. And it's important that people understand that. Like, I made a commitment to the private equity partners and the companies that invested in them that I'm gonna do right by them. And that's important that I put everything I got into this, but it doesn't mean that I can't hire great people like my brother-in-law, like, was a CIO at GE to be a family office guy.
Steve: Do you see, is there, like, a a date where you see, like, okay. We're out of this?
Tommy: Well, you know, the future listen. Every realtor, every developer I know is trying to get a known service because it's it's not 100% AI proof, but, like, they're not gonna be fixing toilets with the machine anytime soon. Right? So I know so many people. I mean, Cody Sperber is going into flooring.
Like, you see all these people running at home improvement and home service. So what I see is we'll probably trade again, and then we'll be planning the the numbers get so big you gotta go public. And when you go public, if I'm a CEO, I can't just sell my like, there's what's called a, number one, there's a six month period where you can't sell. It's a holding period. Mhmm.
And then you could only sell a certain amount at at a time. But what's really cool about when we go public is I could borrow against my stock tax free. So I don't see necessarily a everyone always asked me. They go, I'm going where you're going. You want us to go dump garbage cans?
We will. They're like, we're we're we're we work for you. And I'm like, no. You work for the company. Like, I know but they know how well I try to make sure they're winning.
So I think I can't leave because the company and by the way, I don't have any ego. Like, I I wanna make sure that people understand, like, if you read the book built to last, a lot of bad CEOs say when I leave, the company's gonna fall apart. I wanted to say when I leave, I was just gone to Costa Rica for ten days. The company runs perfectly. I my ego, I want the company and the people I love the most, which a lot of them work there, is it to thrive without me.
But I still think, like, you get somebody that doesn't have as much of a heart that's worried more about profit than people, you'll watch that company fall apart. I'm just afraid because I've seen people come in that say, let's cut the meetings. Let's cut this. Let's cut that. Let's do this.
And I'm like, no. No. No. No. No.
No. No. This is important to our people.
Steve: Yeah. I was you know, when I was at the home services, you know, Cody was pointing out that, hey. That guy is worth this. This guy sold his company for that. Right?
I'm looking around. And then I was telling my wife, like, I'm having a lunch because you guys had the sponsored lunches. I'm sitting and talking to these guys, like, you know, what do you do? What do you what kind of revenue you guys bringing in? And they're talking about how much money they're making.
I I I'm just And as as lunch progresses, like, they're asking me more questions than I'm asking. I was like, no. No. I came here to, like, learn from you guys. Right?
And I was saying to my saying to my wife, like, man, like, what have we just done HVAC for the last twenty years inside of real estate?
Tommy: No. Right? Well, listen. Right place, right time. Listen.
COVID happened. You think every movie theater, every bowling alley, every nail salon, every v bar VRBO basically went bankrupt. There there there was no business, and they got the PPP money. What's the one thing private equity, venture capitalist, hedge funds looked at? You know, these guys, everyone's fixing their house.
Even we're fixing our house. We're putting in mini splits. We've got a dog now, you know. And they go, wait a so all of a sudden, COVID changed everything. Yeah.
I mean, right place, right time. I mean, a lot of it's divine, but I mean, I'm the luckiest SOB there's ever been. I'm always at the right place, right time. I get in a lot of the right positions and the right doors open. Right.
And I asked to get into some of those, but, man, I didn't ask for COVID. And I'm not excited about COVID, but what it did to our industry and, like, people used to when I was getting my MBA and even Danny and Jared, I'd show up, same black shirt. I showed up with Greece. I was, like, putting out fires. I was working in the warehouse.
And I won't say they did this, but a lot of people looked down. They were like this blue collar. This is like blue collar time to shine. Like, everyone wants to get and the problem is these white collar people that are good at not you, but a lot of people that are great at real estate. And they they they were a COO of a company, and they walk in and they're like, we're we know how all this works.
We're gonna go into home service. You gotta know how to talk to somebody that didn't have a data figure. You need to know how to talk to somebody that doesn't know about, you know, how to run a check a balance checkbook or has credit debt. You gotta understand, like, to get people to show up, fix stuff, drive great, like, use a CRM, no inventory. Like, white collar, in my opinion, is way easier.
And then if I'm gonna run a dentist off, it happens within four walls. Do you know how much we gotta worry about? I'm working on 25,000 different jobs. Yeah. Leaving reviews, Like, guys don't show up.
I had eight workers' comp claims last month. I had three cars get in accidents. And we do everything we can. We got a whole safety department, but and everybody's like, man, yeah, we we know how to run a business. We work at this company.
We work at this company. That's fine. But I very rarely see someone come into this industry and just, like, thrive.
Steve: Well, what I said to my wife afterwards, like, let's be honest. Like, these hands were never gonna build in HVAC. Like, I was not gonna be crawling in an attic. I'm not gonna
Tommy: be able to work. You would figure it out, though. You know, most of the best people I know some of the best companies I know, the founder didn't have to do the work. Yeah. He got great people.
So, look, if someone's got the ability to keep going, but I like I always tell people, the first ten years were practice. Mhmm. And that first ten years is what made me. Yeah. The last nine years have been great.
The last four years have been exceptionally great. And it continues to move up levels. And I've got the playbook that I could apply it to anything. That's why we started the Home Service Freedom Group. Mhmm.
Most companies that go into there, they double their profit the first year. Yeah. And it's just because I know the order of operations. Mhmm. Like, there's always something on fire.
By the way, me, you went to the doctor. We probably need a different prescription. I doubt it's the exact same thing. Right. So you gotta really understand the business and understand these things need to be like, if you don't have a p and l that's dialed in on your in a balance and income statement by the tenth of next month Mhmm.
We need to figure out that piece first. If you don't know your booking rate, your conversion rate, your average ticket, or your cost per lead, let's work on data integrity and get those numbers dialed in. Yeah. Like, I cannot help you go anywhere until I know the facts. Right.
Steve: And what's, like, the the blood pressure? Right?
Tommy: Yeah.
Steve: Yeah. You you measure the pulse. There's other things too. You your six steps. There's, looking here, there's, fitness, family, faith.
So you wanna talk about your your six steps?
Tommy: Yeah. So the deal is listen. When you're setting goals, number one, you gotta write them down. Don't put them on a don't put them on a Google Doc. I want you to do six things.
Family and friends are one. Faith is number two, and this could go in any order. Fitness is number three. Finance is number four. Future self is number five, and fun is number six.
And then I want you to buy Jesse answers big ass calendar. And I want you to put the nonnegotiables with family, friends, and and if you believe in Jesus or whatever you believe in, that Sundays, whatever you're gonna block out, maybe there's a retreat. But I want you to really work on the calendar, and then I wanna know I want you to go down to this month. If you're doing fitness, how many steps are you taking per day? I want you to figure out what's your back rows are gonna be.
Once and then once you get and then I wanna know why. I wanna understand your big why behind it. And the last thing, I need you to keep your commitments. That's what this wristband says. Who are your accountability partners?
Now the faith ones for me are way different than the ones of future self that read with me Mhmm. And go to events. Are way different than the ones that are fitness. So not there's no one accountability partner, but I want several accountability partners per zone there.
Steve: Yeah.
Tommy: Fun is just, I'm gonna have fun too. That's who I am. So I don't need any partners for that one. And then you guys meet up week every weekend for thirty minutes, I'm meeting up with accountability partners. Mhmm.
And guess what? I'm a prick. Like, you told me you were gonna do this. You told me why you wanted to do it. And if you freaking tell me because of your kids or your wife, I'm gonna kick your ass because I want you to do it because of you.
Right. Like, you should love yourself enough. And if you don't, I'm gonna help you tell you that you're a great person. You should want this. I know you love your kids.
I know you love your wife. I know you love your husband. What if I said you deserve this? It's okay for you to want this. It's okay for you to wanna live longer and have longevity.
So with you know, it's a lot of different things. There's this Robert Choudini, Simon Sinek. There's Harvard studies about writing stuff down. Yeah. I want you to put it in your shower.
Handwritten sign up on the bottom. I want it to be in your truck, on your refrigerator, on your desk for the month. And then each week, you're meeting with your accountability partners, and they better be assholes. And if you get that right and you got a big why behind it, you you will watch in eighteen months, you're a whole new you. And the other thing that I'll just say is I want you to go through your friends that you hang out with the most and say do they add value.
And this is the hardest thing but becoming the circles that I've been able to get into if I were to go golfing for one year, three times a week with scratch golfers or guys that golfed under par, you better believe I'd be a hell of a lot better by the end of the year, like light years. If we went to the driving range, they tell me what they know. Mhmm. And the fact is, most people, they just the thing holding them back is they're hanging out with the same They're they're on the same things that people dream smaller. The victim mentalities, they never push for the next level.
Like, I think I deserve to be on the same room with Elon Musk. Am I there yet? No. But if he could do it, why can't I? Now I'm not a rocket scientist, but I think I'm I'm worth it.
Steve: Right.
Tommy: And most people don't. And it's this it's this literally, it's what you're bread with in bread with when you were a kid and what your self belief was when you were a child. And if you could break those ties, you could cut the generational curses. Like, everything changes. The thing
Steve: you're saying here about, like, what's your goal and your why. You said, like, it's not about your why. It's not about your kids. It's about you. Are you worth it?
Oh, you gotta you're worth it. You gotta love yourself enough to do it. That is a message most people aren't ready to right? I mean, I imagine you say that quite a bit, and people are like, what are you talking about?
Tommy: Well, I hear everybody that comes in for the orientation. Like, I'm doing this for my wife and my kids. I'm like, well, you've been saying that for the last decade. You must hate them. I'm like, it's not working.
Yeah. What about you? You work hard for your wife and your kids, but I'm telling you, you're not where your feet are at. Every time you're at work, you're thinking about your kids, and every time you're at home, you're thinking about work. Yeah.
So let's be honest with each other. Let's cut the BS. And that my job is to literally like, I'm not firing you, but I'm gonna ask you to come up. I'm gonna I'm not gonna call you out. I'm gonna call you up to the next level.
And if you're not ready for that, I'll glad you write you nice recommendation to go work for one of my competitors. There's,
Steve: the greatest showman. Right? Hugh Jackman. And there was a scene where, you know, like his wife's like, why are you doing this? Like, I'm doing it for the kids.
I I gotta go do the tour with the opera girl, right, for the kids. And, I remember during that scene, I was talking to my my daughter, and I was like, Swainder is like he says he's doing it for his wife. He says he's doing it for his kids. They're telling him not to go. He's not doing it for them.
No. He's doing it for himself. Right? But the part about permission to chase your dreams, the permission to get more for you, again, I think, like, you know, the the mindset, the the willingness to hear that, I don't think a lot of people are ready for it. There's something that says you're not allowed to to break out of the herd, go get more for yourself.
Tommy: I know a lot of people I want you to think about this little fiction story with me. Yeah. A guy works twelve hour days, six days a week. Mhmm. He's got his kids.
He tries to show up for the major ball games and the plays and, you know, the recitals. You know, still shows up for some dinners. And, they're 66 years old now. The kids are grown up a little bit. And, his wife looks at him and says, so what do you think?
And he goes, well, we live in a nice house. Kids turned out pretty good. You know, I did this for you guys. She goes, we just wanted you. We wanted you around.
We were finding that smaller house. We didn't need those nice cars. Yeah. The vacations were always great, but we were fine just going fishing. Yeah.
You did this for you. Mhmm. And we went along with it. And I think that a lot of people like to convince themselves everything they do is for other people. I mean, maybe you should go to see Tony Robbins or get into your inner head because the fact is, I don't think it's selfish to wanna do something great for yourself and to wanna make that next level job.
And if you look at those six f's, that's just my framework. Doesn't mean it's the best one.
Steve: Well, I like it. That's what I'm saying. Like, the fact that you're saying, like, no. I don't wanna hear about what you know, if your wife is like, let's figure out why it is important to you because people don't wanna have that conversation.
Tommy: By the way, if you told me what you want and why you're doing it for you, I'd go, well, what is the I'm gonna peel the onion back then go, but why? Then you're gonna sell me that, but why do you want that? Yeah. But why? And then eventually, you wanna get to the center of that onion and get to the root cause.
And by the way, you probably you gotta talk to somebody like a psychologist that you feel comfortable with because it's not something when you do this exercise, you continue to feel well, I just wanna make sure they grow up right, but why? And you start going back to usually comes back to when you were a kid and somebody told you you couldn't do it or you just, you know, shat on.
Steve: Well, you know, you're talking about your story about, you you listening to your parents. Are you on the other side? Right? Yeah. Well, and, like, that story comes up quite a bit for a lot of people that have a lot
Tommy: of success. Right? Yeah. Some something was broken. Yeah.
Somebody told them they couldn't. Something bad happened.
Steve: Yeah. Another thing too that I was surprised to hear at check, which I think is absolutely insane, is that you just have, like, weekly shop events. Like, you just have people just check out what you do. Talk about this because I think it's crazy how much you, like, just give all your secrets. You know secrets, your keys.
Tommy: Well, the the the funny thing is is, if I told you how to get a six pack, it's all over the Internet. There's a million books written on it. Mhmm. Only 1% of the people are gonna Mhmm. And by the way, I wanna see who those 1% are, and I wanna get to know them.
Sometimes I get people enough information to sink them to the bottom of the ocean. It's too much. But, so many people, hundreds of people open their door. They let me come to their shop. They they they took me into their home and let me sleep at their house with nothing in return.
And I said, that changed everything for me. So when they come out and see the shop, I'm like, I spent a couple hours with them. I show them our training center. I answer all their questions. I whiteboard.
I tell them the biggest lessons I've learned. What not to do, what to do right away, what to think about. And, you you know, there's certain people that have messaged me and said and said I was gonna commit suicide or I was in the middle of a divorce or my kids will go like, the craziest thing comes out of these things because what am I I think what I've become for a lot of people is hope. And that's a bigger calling than anything. Yeah.
So I like to just do it, and there's no expectations. And I've had a lot of people come back five times because everyone's a little different. I would love to see there's no exact system for these because people it depends on the audience, what industries they're in, what kind of mood I'm in, and, you know, but I love sharing. And it's one of the one of the things I look forward to.
Steve: And then I was at your freedom event last year. I don't remember what month it was. I wanna say maybe it was September. I because I was actually supposed to be at a different event. Right?
Like, I canceled that event. I canceled that flight. Because Bryant Yeah. Like, I was talking to Bryant, and I was like, hey. Look.
I've got this AI software. You know? I think, I'm I'm interested in the home service space, see if there's, you know, any interest in that in that space. I'm just gonna go, and I'm just gonna learn. I'm gonna see, like, what are the home service people like?
What are the, vendors like over there? I'm just gonna I'm gonna listen. And I think over the course of two, maybe three days, you guys just gave, like, crazy value from the stage. You had, like, I don't know. It was thousands, but there were a lot of people.
Tommy: That's 1,500. Yeah. 1,500 contractors.
Steve: And there's a lot of people. I mean, it went all the way to the back. I mean, it it went back enough where, like, I couldn't I could barely make out the guy on stage. Right? So it was a crazy, crazy event.
So, like, I guess if someone's interested in, like, the the shop shop tour, someone's interested in in in your next event, like, how can they find out more about that?
Tommy: I appreciate that. So Tommy Mello, there's no w in my name, t o m n y m e l l o.
Steve: That's good because
Tommy: Not so Mello. Yeah. And, tommymello.com is on my social. You can find my podcast and stuff. And then if you go to tommellow.com/shop, you can see the dates I do the shop tours.
Sign up. Bring anybody you want. Bring your team. Bring your family. Doesn't matter to me.
We'll have waters and food there. And then if you wanna come to the event, this event's gonna be really special. It's called freedomevent.com. It's gonna be October 26 through the twenty eighth. It's gonna be in Vegas.
And we're getting I'm not even gonna tell you because we're not a 100% sure, but maybe the richest man in the world might be there. We're still working on it. But, but we're, this year's gonna be some huge announcements. And if you're in the home service space, thinking about getting the home service space in the home improvement space, and you just the biggest thing that I could ever tell you is it's not the content, it's the people you're gonna meet. It's the shaking the hands.
And the the when I used to go to these events, Steve, we used to I used to go alone or bring Adam with me. And when I go to, like, service times events, I bring 30 people with me now because I need them to believe in the dream. I need them to get excited. So I bring more than anybody. If you go to Pantheon, you'll see one of our guys almost anywhere.
But just bring a few key players with you because they need to know where what what's why you came back excited. It's like, you know, the CEO or the founder that reads the book or goes to a clinic or hires a consultant, he goes in and they're like, great. What did he read this month? What are we gonna have to change this month? It's like if they buy into the dream Yeah.
Then it's all good. And by the way, we're not there. You've been to those events where it's a sales it's continuous sales pitch.
Steve: Yeah. It's not that.
Tommy: What we're doing at all.
Steve: Yeah. No. I I've I've been to those events, and those event those events are awful. Yeah. No.
This is definitely not a pitch fest. No. It's value. Like, what, you know, just, again, watching people go, speaker after speaker after speaker, sharing what works. Yeah.
And I think that's key because, like, even though I wasn't the avatar, I could see how someone that's in the business would benefit, immediately, from the information. Because you got your people, like, people that work at your company sharing here's what's working inside our business. Yeah.
Tommy: Yeah. No. We we we are an open book, man, and almost to a fault, but I'm like, worst case scenario, they figure it out. But by the time they figure it out, they're not gonna figure it out day one. I mean, we're figuring out what worked last year.
We're talking about the history. We're not talking about what we're doing tomorrow. Right.
Steve: And by
Tommy: the way, what we're doing tomorrow is building off what we did yesterday. So it's not like but it's easier to catch up when you know it at all. Don't get me wrong. But Oh,
Steve: you got the blueprint.
Tommy: I know. I like sharing. And the more I share, you know, Zig Ziglar said you could have anything you want in life if you help it out, people get what they want. Mhmm. And the people that I've seen their businesses flourish even in our industry, they call me up.
I'm talking to this guy one day for an hour and a half, and I'm telling him everything I know about the garage industry. He goes, Tommy, I only have five technicians. Why didn't you just spend ninety minutes with me? I go, because I had people when I was smaller than you doing the same thing with me. And he goes, well, can I give you a tip?
I go, I'd love one. He goes, on the Chamberlain page, LiftMaster for openers, we're number one in this dealer locator because we sell a lot in our small market. He goes, if you ask them to put you number one, you you buy more than I do. I was like, thank you. So I called them up, and I'm like, you guys gotta fix this.
35 new calls per day from that. Right? But but I didn't ask him for anything. He just told me. And it's funny how when you share enough with, people, they they they they feel and I don't ask them.
I'm like, hey. I'm not like the godfather. Hey. One day, I'm gonna call you. You know, you pick up.
But, you know, they rest of product comes back in full circle.
Steve: Yeah. So, obviously, you're driven. But, you know, looking back a hundred years from now, eighty years, because we're probably gonna live forever
Tommy: at this point.
Steve: Yeah. I agree.
Tommy: What
Steve: do you wanna be remembered?
Tommy: Three things. I'm getting married in January 1. Very excited. Never been married. No kids.
The most important thing is, best dad in the world. Yeah. That's the most important thing. I don't care about money or industry or home service. The next thing is that Tommy guy, man.
He was probably the most curious person. And third, even though God was good, he had nice houses. He lived the best life. He was super humble. He still was the guy you would have met at 10, 20, 30, 50 years old.
Nothing changed. He still looked you in the eye, respected you. If you're on the street, he'd help you out. Yeah. And that's important to me.
I never wanna act like I'm too good or I've moved above that. So if I could be those three things, obviously, good husband's up there too. Mhmm. But, I I wanna be very good because, you know, I'm I'm really excited for that chapter. Well, I
Steve: can definitely attest. Right? Like I said, we met each other so many years ago. Same guy. And, like, you don't know who I was.
I was just an introduction from Jared. You know, like, let me just show you my garage, and then we just walked around the building. You just told me everything you were doing. Yeah. Right?
And you were we were talking about, like, how you were generating leads. Like, that was the thing. Like, you know, let me tell you how we're generating leads, and we just, like, walked around the building.
Tommy: Yeah. You know, it's funny. In, 02/1989, I came out of this program called clad genius. And instead of a cable router, you needed a dial up. And you buy these tokens and you could post ads on Craigslist automatic.
The mouse used to move Mhmm. And it would post. And I ran three different ads to my stepdad, four different ads to me, and then two different guys that work for me and one to my mom. And we post 500 ads a day, and we booked 25 calls off of Craigslist. And that's how we basically turned into the lead gen back then.
And if it weren't for Craigslist, I probably wouldn't be here today. If it weren't for painting garage doors, my roommate, like, it's just kinda funny. So now I look for those easy wins. I had a company out two days ago. These guys are doing 10,000,000 of EBITDA.
He goes, Tommy, we've got an AI machine that puts out two 10 new ads a day on Facebook, Instagram, TikTok, and YouTube. And they gave me everything. And I'm like, 10,000,000 in EBITDA? You you didn't even claim your profile. You don't know PPC.
You don't even know how to do mailers. You don't know how to get reviews. You don't do Angie's List. You don't do anything. This is all you do?
And I'm going, but those are the unlocks. And by the way, if I can help them, triple, you think they'd give me that? Yeah. Yeah. In a heartbeat.
Absolutely. That's that's the power of working with people and opening the doors and sharing.
Steve: So last event and, again, I think it was in September. You guys ran out of VIPs. Because I tried to get in a VIP, and I was locked out.
Tommy: Yeah. That's
Steve: So if you guys get the richest man in the world, like, you gotta promise me
Tommy: alright, I
Steve: can buy a VIP ticket. I'm not even asking for a free one. Just let me buy one because you guys were locked out last year. The fire marshal was not so kind.
Tommy: Yeah. That you you know what happened is, we ran out of seats, and about 20 people showed up, and they said, we'll we'll pay whatever it costs. They were like, you don't understand. Like, I felt like a douche. I was like, I thought I told but here's the thing.
We got a whole team. There's, like, 20 people on the team. All of a sudden, the last week, my phone and some of the guys have been every year and they're like and I'm like and I'm and, like, I mean, I I'm like, let me call the fire marshal, Jim. I'm like, let's figure this out. And, like, we we were able to squeeze a few more.
Like, it was just so this year, we're anticipating 3,000.
Steve: Yeah.
Tommy: And we've actually like, I don't wanna run out. And that was it's very rare to be in an event and, like, a lot of times it's kind of a lie. Like, yeah, we sold out and they like to say they sold out. Like, we literally like, you would have paid four times to get the v we ran out. We couldn't do it.
Steve: Well, I know you sold out because I was talking to people as I'm walking up, and it felt like it was like a a sporting event. Like, do you have any extra tickets? It was like right? Like, they're like, yeah. I'm just waiting for them to say, like, there's more spots because, like Yeah.
No. There's no more spots. Like, you know, like, did you have an extra ticket? I was like, this is, like, a weird like, I've never gone to a vet where it's like, do you have any extra tickets?
Tommy: That's so funny. I didn't know that.
Steve: So alright. Wrapping up here, what are what what is something you wanna leave all the the listeners with? What message would you like nothing else, like, took away from us?
Tommy: Dream big. I I always I I think I came up with this. I might have read it, but I I I think I came up with this myself. I always say it. I'm the best I ever been, but the worst I'll ever be because tomorrow I'm gonna be a little bit better.
My life is on purpose. It's not by chance. It's been manifested. I know what's coming. I've got a strong plan.
I've got contingency plans. And I wanna have fun, man. I wanna have the right relationships. You don't need to read 500 books. You need to read five books a 100 times.
You don't need to hang out with a 100 successful people. Hang out with 10 and get to know them and build relationships. And shoot for the moon and the work or shoot for the stars, and if you land on the moon, you're doing good and just just concentrate. Like, the power of no is so real. It's so easy to say yes.
It's so easy to to wanna do all these things and conquer the world. But if you if you think about this, then I'll just final finish with this. Most people overestimate what they could do in one year and underestimate what they could do in five to ten. And so many people are looking for just this this overnight success story, this Bitcoin that just did this. And the the reason it works slower is you're learning lessons along the way.
If I were to give you when you won the lottery, you lose it because your thermostat is not set right. Yeah. It doesn't deserve that. Now when you work up to it I mean, I am building the perfect life. We're building a place in Idaho.
We're building a house in PV. We bought we won the award for the most expensive five acres ever sold in Arizona. And we're building our dream homes. And I'm not building these to say, look at us. We're gonna share so many memories.
That's where we build relationships. Yeah. And the best relationships will come out of those. So I had a blast today. I really appreciate it.
I had a lot of fun. I wanna learn all about your AI agents that you're running because, I think we could use that. And I think anybody that's listening should definitely reach out because I know you guys are booking booking, sale by owner type stuff all day long. I follow you. So it's good stuff.
Steve: Alright. Thank you so much for coming. I absolutely
Tommy: appreciate it. Appreciate you. Yeah. Thanks. Thank you
Steve: guys for watching. We'll see you guys next time.
Tommy: Shout out to Steve train. Jump on the Steve train. Disrupt us.
