Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy where I interview entrepreneurs about how they built their businesses. Usually, my guests are like full-on tech entrepreneurs, got funding from Silicon Valley, built stuff that’s all in your phone or on your computer, or, frankly, on somebody’s server and you never get to interact with it.
Joining me today is an entrepreneur whose company is very much offline and has to be because your toilet is offline. His name is John Akhoian, and he is the founder of Rooter Hero. They are a plumbing service with multiple locations and good revenue. And what I wanted to do was bring him on for frankly, from variety. I want to understand how businesses like that work so that we could get ideas outside of our bubble.
You guys know if you’ve been watching, one of the things I’m doing this year is running a marathon on every continent. And as I fly all over the world, I’m bringing my tape recorder with me. I actually have this little recorder. I’m going old school. I’m setting it down. I’m putting lavalier mics on people. And I’m having these personal one-on-one conversations with entrepreneurs all over the world to broaden our understanding of entrepreneurship, to get ideas from outside. And we’re going to do that here in this interview.
What John has done with some of the offline ads with some of the hustle, I think it’s going to be inspiring and we’re going to learn from him and bring back his ideas for our businesses. And we could do it thanks to two phenomenal sponsors who will put up with the fact that I talk so fast that sometimes people can’t even hear their names when I do their ad spots.
So they are Toptal for hosting website . . . No. Toptal for hiring developers. HostGator for hosting websites. We’ll talk about them later. John, good to have you here.
John: Yeah. Good to be here, Andrew. Thank you.
Andrew: You’ve heard my interviews. Do I talk too fast? I feel like I do, but sometimes as a listener, it’s different.
John: Well, you know what? I like hearing the fast-talking because whenever I’m listening to audiobooks, I always speed it up a little bit.
Andrew: Me too. Me too. I always do it at 1.35. Go figure. Let’s talk revenue. Where were you last year, 2018?
John: We were just south of $50 million.
Andrew: This is your business?
John: This is my business, yeah.
Andrew: How much of it do you own completely?
John: Own almost 100% of it. We have one location where we have a minority partner, but for the most part, I own most of the business.
Andrew: I feel like it’s an intrusive question, but I’m going to ask it anyway because that’s my job. What kind of profits can you pull in when you’ve got a plumbing service like this?
John: Well, I mean, you look at a plumbing company, it’s not a sexy type of business. It’s just a traditional plumbing company. And I call ourselves like the ambulance service for homes. So people call us they’re like, “We need somebody to come out fast.” And we run a really good profit margin. I mean, we’ve been able to reinvest our own profits into the company to grow it so rapidly. And I can’t . . .
Andrew: You mean more locations and so on.
John: Right. More locations, more startups and . . .
Andrew: But fair to say you put in more than what? 10% into your pocket every year?
John: Yeah. It’s more than 10% for sure.
Andrew: How? These tech companies are listening in and probably going bonkers. You grew up in Hollywood. The reason that I don’t live in SoCal anymore is I said, “I’m going to have kids. My kids are going to look around, they’re going to see people who are like dazzling with the stuff they have and the big talk they have.” I can’t put up with that and compete with them because I can’t help them compete because I personally can’t stop trying to compete with them. As a guy who grew up in Hollywood, do you now look at your life and go, “I’m a plumber. I’m a little embarrassed to tell all these people. Do you feel that?”
John: Well, I mean, it’s . . . No. Not really. I’m really proud of what I do. I mean, I actually tell people I’m a plumber. I’ve been a plumber since I was 17 years old.
Andrew: How do you . . . I’m sorry to . . . How do you get past that? Because maybe it’s just me, but I definitely suffer from it. I watch all these people who talk big. I can’t compete with them, and I go . . . I can’t compete with their fakery, or I try to compete with their fakery and I can’t. What allows you to not get sucked up into that world?
John: Well, a lot of it is just staying humble and just using doing the process every single day, showing up to work and remembering where I came from.
Andrew: And where did you come from? What did your parents do?
John: Well, my dad was a truck driver. I got into plumbing . . .
Andrew: Tow truck driver.
John: He was a semi-truck driver. So he was loads up back and forth from San Francisco to LA. And he died when I was 17 years old, and I dropped out of high school and got into plumbing and I’ve been doing it ever since and it’s been really good for me. Even though it was plan B, it actually turned out to be one of the best things I’ve ever done.
Andrew: I heard that you used to go and put signs up on pay phones for him.
John: Yeah. I learned marketing when my dad had a tow truck company when I was 12 years old. So he went from tow truck to semi-truck eventually, but me and my brother used to do marketing for him. So back then there was no cell phones. It was all payphone. So our marketing strategy was to drive around everywhere in Hollywood, find a payphone, I’d jump out when my older brother was driving, I’d go to the payphone and I’d put one of his stickers on a payphone that had his beeper number on it.
Andrew: And it worked because when people were stuck, they’d go to a payphone. They’d try to figure out how do I get a tow truck and boom, they’d see him.
John: Yeah. I mean, it’s kind of crazy because my dad was in the emergency business as well because people were stuck, they needed somebody quick, and I was out there marketing for him. And I remember when I first started my plumbing company, I actually took my business card, had some coupons in the back and I’d leave it everywhere. And I’d leave it on phones, I’d leave it behind the escutcheons on urinals and bathrooms, public restrooms. I’d leave it pretty much everywhere. So marketing has always been something that’s been in our tradition for a while.
Andrew: What’s . . . You said the escutcheons?
John: Well, when you have the urinals, they have those flush valves, right? So they have a little chrome thing on the back. So usually I’d stick a business card right on the escutcheon between the . . . so when somebody is at the urinal using it, first thing they’re looking at is where they flush it. My business card would be right there.
Andrew: Did that work?
John: Oh, it worked great.
Andrew: Really?
John: I mean, we got so much business and we had our entire team that was doing that leaving business cards everywhere.
Andrew: Wow. I always wondered about that. And so at 17, you got into this. You partnered up with a guy named Arthur, right?
John: Yeah. I actually worked with Arthur for a while. He was sort of my mentor that taught me plumbing. And after a couple years, I really enjoyed and I advanced quite a bit in his company and I had to talk with him. I said, “Hey, you’re a single truck operation. Let’s grow this thing. I want to see it become 50 trucks, 100 trucks.” And he said, I remember this like yesterday, he’s like, “John, I’m comfortable with one truck. I don’t want the headache.” He said, “You’re very ambitious. Go out there and do it yourself.” So I said, “All right, great.” So two months later I was out there doing it myself. And that’s where it all started. I started my own company at 19 and eventually sold that company off when I was 22, started another one. And this is our third company. And this one’s been growing really fast.
Andrew: Why did you want to do more? I’m kind of fascinated, you might know this about me, about the motivation. What is it that drives us to work so hard when . . . You’re not driving a Lamborghini. You don’t need the extra money to buy better anything, right? Me too. Why are you doing it?
John: Well, I’m doing it because I feel like this is my calling. I mean, I’ve been doing plumbing since I was 17 years old, and there’s a shortage of plumbers. The need for plumbing is just growing rapidly. There’s more plumbers right now retiring than people going into the trades. So with that shortage, with that big need that’s out there, I feel like I can help fill the need. And we’ve done a lot of things in our company that’s helped kind of create and market and get people into the industry because it’s not a sexy industry. It’s not something people want to do. You don’t grow up going, “I want to grow up and be a plumber.” Grow up and you want to go into different stuff, but you have . . .
Andrew: Be an Instagram star.
John: Yeah. You fall into plumbing because of hardship, and that’s exactly what happened to me, but it’s a great place to be. We have guys that start with us, that work in our company and they go from six months ago when they didn’t know plumbing and now they know plumbing and making six digit incomes quickly with no school debt. So I really like seeing the stories and hearing the people that come in and figure out that they could make a lot money doing this.
Andrew: So you said, “I’m going to go off on my own.” You started a company. I got a sense of the way that you were getting clients, right? It was the kind of stuff that you mentioned before putting cards up everywhere. Was there anything else that I’m missing about that first business?
John: And I was pretty much grassroots, knocking on doors, putting up flyers, going and shaking hands, getting to know people. And back then there was no internet, so we were dealing with just the grassroots type of marketing face to face, word of mouth.
Andrew: And you just hired other plumbers, you started building it up. Why did you sell it at 23, which must have been four years after, right?
John: Yeah. While we were doing a lot of commercial work and I wanted to get into the residential plumbing. So back then I ended up buying a plumbing franchise and got into the residential plumbing end, which I really wanted to get into and sort of got . . . sold off the commercial plumbing business and really fast we grew that company, became franchise of the year and became sales leader of the year many years back to back.
Andrew: How? I heard that one of the reasons why you became a franchisee was you said, “They’re going to help me get customers.” And they didn’t. They’re going to do. They didn’t. What did they give you? And then what did you have to do to make up for what they didn’t give you?
John: Well, what they did is they gave us a business concept. They taught us things that I didn’t learn in school because I dropped out. They taught me how to read a financial statement, how to manage a balance sheet and do a lot of the business stuff. And after I got to know that, I mean, marketing part of it was something that they were going to help with but that really didn’t kick in. So we grew pretty fast. I mean, I’m happy that I got into the franchise, but I was also happy to get out to start this brand as well because I feel like now we could go nationwide.
Andrew: So you sold that business, the franchise?
John: Yeah. I sold it after doing two terms. I ended up selling it and started this brand here. And we grew this from one truck in Orange County to over 250 trucks right now, and we’re growing really rapidly.
Andrew: It’s called Rooter Hero. What is rooter?
John: Rooter is a old term for drain cleaning. So when people think about their drains backing up, they think about rootering. So it’s almost like Kleenex, they became a brand name. It’s actually a napkin, but people call it a Kleenex. Or a Googling. Rooter became that term in our business. So by using the rooter before the hero, it reminds people that we’re in the drain cleaning business and we also do plumbing as well.
Andrew: Yeah. And the problem with doing any search in this space, like I have ad blocking on to the hilt, John. And still, one of the few terms that if I type into Google, rooter, define rooter, I end up with the whole screen literally my whole screen right now is covered in ads. And if I keep scrolling, somewhere in there, I will see you. And then I’ll see a bunch of Yelp and stuff. It is just so competitive because that’s what people do there. When they’re searching, they’re not just browsing. At that point, they’re ready to sign up, right?
John: Yeah, yeah. Most people are searching because they have an emergency. And that’s typically when they’re looking for somebody to come in there. And for some people, I mean, if they have three toilets backed up, and one of them isn’t worth . . . If they have three toilets in the house and one of them is backed up, that’s an emergency for them. They don’t want to have that, so they’ll call us up and want us to go out at 2:00 in the morning to take care of that.
Andrew: And you’ll do that 2:00 in the morning? You’ve got somebody up.
John: We have somebody up at 2:00 in the morning.
Andrew: You told our producer, “My first customer it was from my neighbor.” But it wasn’t just like a person who said, “Hey, I need you to fix my toilet. I’ve got three toilets. One’s backed up.” The neighbor was in the business. What did your neighbor do?
John: He was an HVAC contractor, and he had a lot of commercial customers. So I networked with him. He introduced me to a lot of people that got me into a lot of management companies that got us a lot of work pretty fast.
Andrew: And why you? You were just getting started. I’m guessing you had a plumber or two who were working with you, right? A truck or two?
John: Yeah. It was me in a truck back then that was when I was 19. And it was me in a truck and I made a decision that I was going to grow my business and I was going to spend as much time as I could marketing. So I just networked with everybody I could get ahold of.
Andrew: Okay. So this was when you were 19. That’s how you got that first business.
John: Yeah.
Andrew: And he was just giving it to you, “Give it a shot, kid. See what you can do,” and you did well with it.
John: Yep, absolutely.
Andrew: You said, “Look, there were three things that I had to be great at,” to our producer. You need to do the plumbing, you need to do marketing, and what that meant a lot of door to door paying stuff up. And you needed to be prepared for the next step. Does that sound right?
John: Yeah. So I mean, there’s three things I focus on right now, Andrew, and mainly I try to fill my calendar with all three of those things. And the first thing is marketing. I feel like marketing is the most important thing when it comes to marketing our brand, marketing our mission, our vision, and getting it out there. And I wrote a couple of books that talk about what our mission is and talk about the industry, marketing even in the industry, you know, to get people into the industry.
And the next thing is growing our brand. So I focus on a lot of acquisitions right now, and I spend a lot of time looking at other businesses that will complement what we’re doing and tuck it in. And the next thing is supporting our sales team, making sure that they have all the needs they have. And I’ve got the sales team that I deal with on a day-to-day basis. And those are the three things I fill my calendar up with.
Andrew: When you say “Looking for companies that kind of tuck in well with your business,” what do you mean? What’s an example of that?
John: So one example is that when we were expanding south into San Diego, we found a company that was out there that was doing a really good job acquiring customers through online marketing and other things, but they did a really horrible job as far as when it came to servicing customers. So we approached that company, we ended up buying that company, and that helped us get into the San Diego market and helped us grow our brand in San Diego as well. So I look at, what are companies doing out there? What they’re doing really well. How do they fit into our culture? And can we actually take what they’re doing and 10X it and growth by 10 times?
Andrew: What’s the name of the company that you acquired? I want to . . .
John: I can’t share that company.
Andrew: Why is that? I sense that actually. Why?
John: Well, I don’t know if I’m able to because I’ve had a nondisclosure, non . . .
Andrew: Even on which business you acquired. That’s kind of interesting.
John: Well, I’ll tell you what that one was. It was called Option One.
Andrew: Option One. Okay. And what they did was . . . Option One, they were really good at online acquisition. I see them actually, but yeah, I see what you mean. The reviews are not very strong for them on Yelp. It seems like Yelp is a big source for you guys of online customers.
John: Yelp is not a big source. The biggest source is Google. And that’s sort of like the big gorilla, the one that we get most of our business from. But Yelp does play a game. Yelp is a little difficult because Yelp is more for restaurants I think and . . . When we, our online team looks at Yelp, they look at it like a love and hate relationship because they filter a lot of the good reviews out. So we have a lot of five-star reviews and a lot of great reviews and they’ll take them out. And they’re almost like the mob of the internet I guess.
Andrew: You know what? I’ve heard that. And it’s one thing to hear it from somebody who’s bigger, who maybe has like all kinds of issues going on with them and all kinds of reviews. It’s another one it was a friend of mine with, like, small office who stopped paying and then he found that they were filtering reviews or allowing other reviews. It’s just like this weirdo thing that they’re doing. The benefit that they have is it seems like if I Google, I end up with their search results because they’re so good at SEO.
John: Yeah.
Andrew: All right. Let me talk about my first sponsor and then come right back in here and we’ll continue with this story. The first sponsor is a company called HostGator. If you need your website hosted, if you have . . . Forget just websites for your business, John. Like, maybe you come up with an idea and you say, “You know what?” Your books have their own websites, John?
John: Our books actually go to our website. So we have a section on our website where we house the books.
Andrew: Oh, and the reason you’re probably doing that is because you want more SEO on the books. Am I right?
John: Yeah, we want to send people to our website. That’s . . .
Andrew: Got it. Yeah, I see. All right. Yeah, I’m looking to see what you’re doing. What it leads me to when I do a search for your name and books is the PR stories that you guys have written about it.
All right. For some people, they have a book, they’re not necessarily looking for SEO, what they want to do is just give it a home so that people who search for it can find it, have that one site and maybe it expands into something beyond. They go to HostGator, they create a Host . . . They quickly create a website to host it. Other people say, “You know what? We’ve got a challenge. We want to challenge people to do something.” I don’t know what it is. Maybe in your business, it might be, “We are challenging you to fix your . . . ” No. What’s a good . . . Is there a good home repair in the bathroom that people can do to keep their bathroom from needing repair?
John: Yeah. Like, maintaining your drains, making sure that you maintain them so they don’t back up.
Andrew: There you go. Imagine if you have a challenge, a one-day challenge that you can fix it yourself, you can actually maintain your own bathroom and save yourself some money. You create a website with this challenge, you start talking about how the guy who makes money by fixing your drains is actually going to show you how to fix it yourself so you don’t need him. People start talking about it, people start learning from it. And yeah, some of them will actually realize that they understand your business, they understand Rooter Hero and they say, “All right. Maybe when I have a problem, I’ll remember them. They’re the ones who taught me and I’ll go to them with the problems that I can’t fix myself.”
What I’m trying to say is these little campaigns that we have, if we give them their own websites become bigger things because when something has a website, people take it more seriously. And so that’s why I’m talking about HostGator. If you, John, or anyone who’s listening to me has a need for a website, either because they’ve got a brand new idea or because they hate their current hosting company, all you have to do is go to hostgator.com/mixergy and you know they’re going to give you a great price.
They’ll take especially good care of you because you come from me and they got all kinds of benefits that I’m not going to go into, but I will tell you they also have a money-back guarantee. So if you don’t love them as much as I’m telling you you’re going to love them, they will give you your money back. That’s hostgator.com/mixergy.
What were you going to do when you started this business? What did you have in mind for it and how did that change? What’s the plan that you had and what’s the reality that’s different from that plan?
John: Well, the plan we had and we still have is to become a nationwide brand. We’re in two states right now, and California is our primary state. And that’s still our mission. And we’re just going from one state to the next. And what’s changed is how quickly how we ran out of plumbers. Okay. So our product is fixing plumbing, right? But there isn’t enough people out there doing plumbing, and there’s more people going away from the industry than getting into it. So we learned quickly that we have to actually produce our own plumbers. So we created a university, and we have guys going through it. Within three months, we’re able to take a guy that’s mechanically inclined and turn them into a plumber. So we had to figure out how to have our own supply and demand.
Andrew: And give them work. Once they learn, you’re hiring them.
John: Absolutely. We’re paying them to go through training, and after that, we’re hiring them and we’re giving them the tools they need and we’re giving them the trucks and we’re giving them the jobs.
Andrew: Wow. And then what can a plumber make?
John: Well, we have guys that make anywhere from $55,000 to north of $100,000 as a plumber. And then there’s supervisors that are making anywhere from 150 to . . . I have one making over $600,000 a year.
Andrew: You know what? I heard James Dyson had a similar issue. We know James Dyson is a guy who creates a vacuum, but he actually created a bunch of products. Like if you go to a bathroom these days, you’re going to see his hand dryer in there. Women now they use the hair dryer that he makes. I’m hearing my wife talk about that a lot. They’ve got air purifiers, fans and all kinds of stuff. He’s actually creating an electric car to compete with Elon Musk and all these other guys who are doing it. And he said he couldn’t find the right engineers. And somebody said, “Well, if you think you could do better, why don’t you start your own school?” He did that. He did what you did. He said, “I have this way of thinking. Nobody is teaching it the way that I want. I can’t get enough engineers. I’m going to create them.”
John: Yes.
Andrew: It’s a thing. Okay. So that’s the big vision. Did you decide that you were going to own it all instead of franchising?
John: Well, I’ve been in the franchising world, and I’ve seen some of the challenges that happened in the franchising world. And I think we help people get into the business. We have some partnerships, like I mentioned I have a minority partner in one of our locations and I’m open to having partners within the business, but as far as franchising, you’re either the operator or the franchisor. You can’t do both things really, really well. So I’d rather be the operator because I understand the business really well.
Andrew: One of the things that you do that . . . There are two things that I’ve got here on my notes to ask you about that allows you to do this work at a low enough price that you can turn enough profit to allow you to keep growing. And there are two of them. One of them is Titan, that software that you and I talked about before we started, and the other is, you reduce the time and I think even people that go into a job. Which one should we start with? I want to understand how you got efficiencies.
John: Well, I mean, we could start with our software efficiency. So when we started the business, back in 2011, I came across a couple of really good software engineers that were just this quick startup that they started their business right out of college and we were their first customers. So when they came to us, they were like, “We will write the software to do whatever you need it to do.” I’m like, “Thank God there’s somebody out there that will write software to do whatever we want it to do.”
Andrew: This is Ara and Vahe?
John: Ara and Vahe, yeah.
Andrew: And Vahe. And what were they doing before that made them want to come and help you by creating software?
John: Well, both their dads were in the construction. Vahe’s dad was a plumber and he’s still a plumber. So from what I understand, Vahe wrote some software for his dad as a school project or he could probably tell that story better than I can.
Andrew: Yeah, I got to get him on here.
John: But they understand the whole concept of software and they understand our industry as well because their parents were both in the construction industry. Before that, we’ve approached so many software companies and couldn’t find anybody that would actually give us what we’re looking for, what . . .
Andrew: What were you looking for?
John: We were looking for automation. I mean, we were looking for anything that a human being is doing that the software could do better.
Andrew: For example?
John: For example, one simple thing was auto-reports. Okay. I had somebody sitting in my office every night preparing a report which was a dashboard to give me all of the functions of the business, all of our key performance indicators, send it out every evening so I could take a look at it so I could see what’s happening. So when I met Ara and Vahe, I said, “Guys, we need to automate this. I’ve got somebody sitting there for an hour and a half, two hours a day crunching numbers and they’re making mistakes as well because some of the numbers are not coming out right.”
Andrew: Reports like what? What kind of numbers were they putting together for you that you needed daily?
John: I just needed to know how many calls were coming in. I needed marketing reports that tell what was working, what wasn’t working to make quick and fast, easy decisions on moving the business in the right direction.
Andrew: By marketing reports you mean like all these Facebook, all these online ads that you’re buying, even the door tags that you were putting on people’s doors, were they working? That kind of thing?
John: Yeah, absolutely. Everything that we did, every marketing report. So one of the things that we asked them for, which they built early on, was a marketing efficiency report. So we wanted to get a cradle to grave report on where the customer was coming from and how much money they were spending.
Before that, we didn’t have that capability. There was nobody that was out there that would give you a full-on, hey, if the phone rang, and this number, this unique number that this person’s calling from call from this ad, okay, our agents used to go in there, ask them, “Hey, where did you find our number?” And they would say, “Well, I found it here and there.” And almost half the time it was wrong. Right? They would say I called from this ad and they would mark something else. I know they’re not marking the right stuff, so I don’t know what’s working.
So they just forced that right into the software, which gave me a revenue report, gave me an exact marketing report of how much we spent and what we got. So that was some of the early-on reports that we couldn’t get anybody else to perfect. And they worked really hard on it and got us everything we needed.
Andrew: It looks like . . . I’m looking at one of their earlier reports that they had. They would even tell you, like if someone picked up the phone, how many calls did they take for the day? How many jobs did they close? What’s their percentage won? What’s the average sale? What’s the revenue? That kind of thing.
John: Yeah.
Andrew: From each person?
John: Each person, yeah.
Andrew: Because you would have to see people yourself manning the phones when someone would call up and say, “My toilet is broken.”
John: Exactly.
Andrew: Wow. Okay. And so the software is ServiceTitan for anyone who wants to go check it out, servicetitan.com. And so that helped you . . . How did it change your business once they gave you even the first version of it?
John: Well, I mean, it made us more efficient, and it gave us exactly what we needed to look at our business and make the quick changes we have to make in order to go in the right direction. We were growing really fast, and we really needed something that was going to give us all the information we needed to make quick decisions, all the data we needed without having to pour in tons of man-hour and resources in getting it. So by having them automate all of this stuff, it really gave us the chance to make faster, better decisions.
Andrew: I’m looking again at an early version of their site from 2013. There’s a quote from Rooter Hero, “I finally know which marketing campaigns bring me leads. I can finally monitor whether my call center is converting calls into booked appointments.” That quote came from Michael West. Who is Michael West?
John: Yeah. Michael West, a good friend of mine. I hired him as our president in the early days. And he’s retired now. He’s a three generation plumber. And he’s out doing a mission for his church. And he was the first guy that went to Orange County when we wanted to start this company and kind of put the flag in the ground and started the first location.
Andrew: I see. Yeah. Looks like he’s Mormon and he’s on a Mormon mission.
John: He is on a Mormon mission.
Andrew: I didn’t know you could do that later on. I thought that was just a thing that you do earlier in your life.
John: Well, I guess you could do a mission later in the life as well. I mean, I think they’re in charge of some of the missionaries that are out there.
Andrew: Right. Somebody’s got to be there to get them trained and oriented. What about the way that you were working with your people? I heard that there were jobs that used to take a long time and you dug into the process and you reduced the hours, you reduced the number of people who were unnecessary. How’d you do that?
John: Well, I mean, before we put the software in we had a lot of people doing a lot of stuff. So in my opinion, anything that had to be redone over and over again could have been automated. So I wanted to use our people’s time and resources on more proactive things than reactive things. So we started making a list of everything we needed the software to do that could automate things.
Andrew: And it was that. It wasn’t out in the field. It wasn’t somebody in their house who was being more efficient that was as efficient as possible. It’s the software that got them out there. That’s . . . Am I right?
John: Yeah, I’ll give you an example. I mean, one of the things that we used to do was we used to write invoices. I had a bunch of guys with pens and papers and snap packs and calculators who were out there writing invoices, and then they bring all of this back with checks and people over here would have to sit down and type everything that they wrote up into the software, and then they would have to process payment and get the money in the bank.
Today, all we do is everybody, all of our technicians have iPads. They’re all in the field with tablets. People sign with their pens or finger and email them all the paperwork. By the time they get to the office, the check is deposited immediately. They take a picture of the check, upload it, and it’s right in the bank. So we don’t have all of this delay time. We don’t have checks coming back with coffee stains or somebody’s window was open and it flew out of the window or something. So money is getting in the bank faster.
So all of these efficiencies helped us operate a lot quicker, and it helped us reduce the amount of people we needed to do a lot of data entry. So these were early versions of kind of what they automated for the industry, but believe it or not, I mean, the plumbing industry really didn’t have this happening back in 2011, ’12 and ’13. I mean, this was all stuff that was still pen and paper.
Andrew: Yeah, I do kind of believe it because I don’t see a lot of people here in San Francisco sitting in coffee shops saying, “You know what? We need a software for plumbers. I think that’s the answer.”
John: Yeah.
Andrew: It’s more like, “We need software for us. That’s the answer.” Let me talk about my second sponsor. And by the way, I’d love an intro to one of the founders of ServiceTitan to get them on here to do an interview about how they built this for you and for others.
John: Yeah, absolutely. I’ll help get that done.
Andrew: Thanks, John. The second sponsor is a company called Toptal. John, as a person who knows how hard it is to find good talent, you are going to appreciate this. A lot of people who are listening to me who need developers to do a specific thing to just code up one thing, maybe it’s internal, maybe it’s a new piece of their software, maybe they’ve got a client who has this need that they don’t have developers to do. In that case, the best thing to do is go to toptal.com/mixergy. John, at some point, you might need this too.
When you go to toptal.com/mixergy, you’re going to hit that big button, you’re going to talk to a matcher, tell him what you need, talk about the type of work that you’re looking for, how you guys work, what your quirks are, and they will go to their network and find the right person for you to work with or people or team of people, whatever it is that you need. And if you use a special URL after you pay for your first 80 hours, they’re going to give you your next 80 hours for free. It’s toptal.com/mixergy. Top as in top . . . Of course, top as in top. Top of the mountain, I should say. Top as in top of the mountain, tal as in talent, toptal.com/mixergy. Longtime sponsors here.
Let’s talk a little bit about some of the other skills involved. I don’t see it here in my notes, but I could have sworn that you talked about how this is really a very much a people skills business. Am I right about that?
John: Yeah, absolutely. I mean, we deal with homeowners and we’re in and out of people’s castles every single day. So you have to definitely know how to treat homeowners. You have to definitely know that they’re the king and the queen of the palace and . . .
Andrew: How do you do that?
John: And we do it through our relationship-building process we have here at Rooter Hero. So we put every person through what we call a Pep TMT and a boot camp. And it all talks about how we go in, how we knock on the door. I mean, everything from knocking on the door to where we parked the truck to how we walk into the house, to what we say to customers. All of this is stuff that we train everybody on how to do. And this all goes back to just being . . . just knowing what to say and what to do and . . .
Andrew: What do you say that makes people feel good? How do you walk in that makes people feel comfortable about working with you guys?
John: Well, first thing we do is, I don’t know if you’ve ever had a service person at your house. But when somebody pulls up, you’re always wondering, “Are they leaking oil on my driveway? Why is the guy parked there? What if I need to get my car out and my wife needs to go somewhere?” So we always talk about just park on the curb. Don’t take people’s space, right? And when you go to the door, when you’re knocking on somebody’s door, a lot of times our guys are big, they’re big plumbers. And we tell them not to crowd the person’s door. Just knock on the door, don’t ring the doorbell. The kid might be asleep or something. Knock on the door because that’s what friends do, take a step back, give them space, right?
Andrew: Yeah.
John: So when they open the door your face is not . . . you’re not like right there at the edge, right? So ask for permission when you walk in. Can you show me? We put shoe covers on. So we actually have these boot covers that we put on so we don’t attract any dirt into somebody’s house. So it’s just a lot of little things that we do that just show that, “Hey, you know what? We care about you, we care about your house, and we’re here to fix the problem.” We go straight to the problem. We talk about getting to work. And starting to diagnose and figuring out what the client needs and getting their problem fixed as quickly as possible because they really don’t want us there. Right? When they’re calling us, they’re not calling us because they want us there, they’re calling us because they have a problem. They want you to go in and get something fixed and get that done.
Andrew: How do you know that they’re doing this?
John: Well, we’re training it and we’re monitoring it.
Andrew: How do you monitor?
John: The way we monitor mainly is through our reviews, but we also call back every customer and we ask them how the service was. So we monitor it by calling back, by doing surveys, by looking at reviews, and by making sure that everybody goes through the process. And we retrain it every single week. So although people go through a three, four-day training on how we do things, on top of that on a weekly basis they get training, and on a monthly basis, they come back if we feel like they need it.
Andrew: Let’s talk about systems. It feels like this is a very systems-oriented business. How do you keep track of the systems? How do you improve them?
John: So the way we keep track of systems, and that’s a great question because it is a systems-oriented business. And a lot of times, it’s all monitored through our people here. Just looking at the process of how everything is going. If there’s something that’s not working, we have people that are looking at it and they’re really . . . They will tell us what’s not working.
So for example, in our call center, if we have something that’s not working in our call center, our call center managers constantly monitoring and listening to customers. And when they feel like there’s something that’s not working, they’ll take it directly to my Chief Operating Officer and he’ll make sure he nips it in the bud right away.
Andrew: And when you create systems, do you have . . . is the software allowing you to manage it? Or what are you using to make sure that people are doing it? I remember talking to this one guy who had a pizza place. Just give me an example of what I’m looking for. He said, “People weren’t following our systems. So what I did was I gave them these disks at the end of the day, once they did their thing, they’re supposed to put a disk on a table. And I understood the disks are there. We can all see very clearly that things are done.”
I think about that a lot. A lot of times I want my systems to be in a computer and I realize, “No, it should be part of what we’re doing so that it’s visual and we can see that we’ve done it.” Do you have something like that that you’re doing?
John: I mean, there is . . . We do have people that are monitoring all the invoices. So for example, one of the systems we have is to make sure that we have pictures for every job. So we have somebody that’s in there going through everybody’s file, and ServiceTitan has made it so simple, everything in one place, right? So when we go to the customer’s file, we have their invoices, we have their pictures before and after of what we fix. We have videos. We have pretty much everything that’s stored in the cloud that’s easy to access. So somebody goes in there and just has to check mark.
So we typically go through and make sure that everything that we need for that customer’s file is there both for compliance purposes, but also to make sure that everybody’s doing what we expect them to do. But it makes it a lot easier because everything is stored in one place and we could monitor it from home if we have to.
Andrew: Yeah, I’m looking at their software. You can even within their software buy something that you needed. Like if you needed to buy an air conditioning unit within the device that you send people out, the iPad that you send them out with, there’s a button you press and you get it, right?
John: Yeah, yeah. A button you press you get financing, a button you press . . .
Andrew: Yeah.
John: Everything is a button.
Andrew: It’s fantastic this software. So far we talked a lot about all the wins. It seems like there’s just a lot of progress. Three businesses, all three have done well, the biggest challenge that you told our producer was finding people and you decided, “All right, we’re just going to train our own people.” Was there another one? Was there one that you felt like, “Maybe I can’t get through this”?
John: Well, I mean . . . I’ll tell you. Some of the things that have changed is that we would . . . Because I’ve been in the industry for so long, marketing has changed quite a bit, right? So we went from people had big Yellow Page books to now everybody’s online. All of the information is on the fingertips. So one of the things that we had to do is our marketing department, which is run by somebody that’s really good online, we had to bring on some marketing talent. Marketing back then was once a year. All I had to do is meet up with the big Yellow Page companies once a year and sign a contract and then forget about it until the next year. But now we got to monitor it on a daily basis.
Andrew: And that means all these ads that you’re doing . . . I know that we met you through Riley PR. So you’re hiring a PR agent, which wouldn’t have been done before in the old Yellow Pages days. What else are you doing that’s different and creative?
John: Well, we’re doing like when it comes to training people, we have a lot of online videos that we have our own university site where we have people going in there so we can train people on how to fix stuff, we could train people on our relationship building process and everything right from their iPads, right from their own computer. So a lot of times when we hire somebody, we pre-train them. We have them go watch all of our videos. And if they ever need to go back, we could monitor it and make sure that they’re going back and looking at the videos that we need them to look at.
Andrew: To know that they’ve gone through it.
John: Yeah.
Andrew: Yeah. Yeah, I’m looking at your SimilarWeb to see where your traffic is coming from. They’re saying the top places are organic search and paid search. Organic search, something like this is going to help out with. You guys don’t do a lot of content, I don’t think. All right, let me see. Rooter Hero. And then paid. You’re buying a ton of ads.
John: Yeah. We do a lot of paid . . . We do some organic as well but we do a lot of paid.
Andrew: Yeah. Here, Rooter Hero in Action blog. It’s not huge. It’s not the big thing that’s bringing people over. Springtime plumbing tips. Oh, yeah. You guys do stuff like that. And then I was looking to see what else are you buying? Where else? There’s not much YouTube. It’s not much Facebook. It’s just those tools right now. And as I said, I still see some from Yelp. It’s like 23% of referring traffic is coming from Yelp.
There’s something called mgclicks.net which I clicked on. I said, “What is mgclicks.net? Why are they sending them so much traffic?” And so I went to mgclicks.net and the site says, “What is mgclicks.net? This is an advertising technology tracking domain. Before traffic is delivered to the advertisers landing page, Mgclicks is used to identify and qualify traffic to prevent fraudulent practices.” So you guys are doing some kind of pay-per-click and this is your way of making sure that you’re not being ripped off by the publishers.
John: Yeah.
Andrew: All right. Anything I missed?
John: No, I think you . . .
Andrew: We got it. All right. The website is Rooter Hero. It is amazing how big you’ve grown this business. I really am fascinated by businesses that are old school that are being modernized and are more competitive because they are. It looks like you’re one of the first to have done it. I’m excited to hear the story.
I want to thank the two sponsors who made this interview happen. The first will host your website right, it’s called HostGator. Check them out at hostgator.com/mixergy. The second . . . Well, I do talk fast through their ads. The second is the company that will help you hire developers, it’s called Toptal. Check them out at toptal.com/mixergy. And finally, looking for more feedback from you, so email us. Email the whole team contact@mixergy.com. Email me directly andrew@mixergy.com. Or I’ve been using Twitter a lot more lately, so tweet at me @andrewwarner. John, thanks so much for doing this.
John: Thank you, Andrew. I appreciate it.
Andrew: You bet. Bye. Bye, everyone.
