Full transcript10 chapters · 11,236 words
00:00From a paper mill to co-owning Dynamec 50-50 with Isaac
Austin Blanchard: One of our best electricians said two years ago he had no experience in the trade. We don’t hire for skill and we don’t poach from our competitors. We take green guys with the right character and we build them into the techs that we need ourself.
Austin Blanchard: People think it can’t work and it can work. It’s actually the whole reason that we grew.
Tyler Martin: Welcome to Profit and Grit with Tyler, where blue-collar owners and insiders spill the real story behind their hustle, building businesses that thrive through sweat and smarts. We’ll dig into their journeys from scaling chaos to growing the bottom line with lessons and grit that pay off big.
Tyler Martin: Here’s your host, the Blue Collar CFO, Tyler Martin. Growing a multi-trade company without acquisitions, outside investors, or a bench full of experienced technicians requires a very different approach to hiring, training, and leadership. In this episode, Austin Blanchard shares how Dynamec grew into a 20-person HVAC, plumbing, and electrical shop by building around clear partnership roles, hiring for character first, and developing technicians across multiple trades.
Tyler Martin: We also talk about separating service from project execution, measuring technician performance, protecting margins, and building custom systems that can support the company as it continues to scale. Let’s talk with Austin now. Hey, Austin, welcome to the Profit and Grit Show. How are you doing today?
Austin Blanchard: Hey, what’s up, Tyler? Good to talk to you.
Tyler Martin: Yeah, nice to see you again. I’m really excited for this conversation. I’d love to introduce you to the audience to start out here. Could you tell us a little bit about what you do professionally? And then I’d love to learn something about you personally.
Austin Blanchard: Yeah. So just I’ll give you a quick background. So my name is Austin. I grew up in Atlanta. Not going to go too deep into all of that. But I went to school. I got a traditional business degree. Had no clue what I wanted to do coming out of school.
Austin Blanchard: And long story short, I got connected with one of the major hiring companies over there, Georgia Pacific and ended up in a paper mill. I ended up in a paper mill and I actually lived in Alabama, but the mill was in Southwest Georgia. So I crossed the river every day, going back and
Austin Blanchard: forth to work, living in central time, working in Eastern time, super confusing. So did that, got a lot of really good experience, was around blue collar people. I’ve been around blue collar people my whole life, but for whatever reason, I’ve always just kind of gravitated as a
Austin Blanchard: supplemental role and not as an actual hands-on role where I’ve just said, hey, how can I help you do your job better. That’s kind of what that looks like. And just different skill set. I have more of an organizational brain, more of a, well, let’s basically, that’s the hill I want to climb.
Austin Blanchard: Let’s figure out how to get there together. You use your skill set. I’m going to use mine. And in a paper mill, right? I mean, you’ve got a lot of real deep, deep blue collar people, you know, multi-generational skill sets, their grandfathers started up the mill. And so it was
Austin Blanchard: just a really cool place. I moved up to Tennessee to work in a separate paper mill. I worked in operations, did large scale project management for that company for a couple of years. And then the start of dynamic, my business partner, Isaac actually started the LLC in 2022. And I met him
Austin Blanchard: at the church that we went to and dynamics first job was actually installing a mini split in my basement. Oh, wow. Yeah. And so I’m holding the head. I’m like, this is really cool. Like this guy seems like he knows what he’s doing. He’s a nice guy. And we’d been pretty good friends for
Austin Blanchard: about a year at that point. And when we’re holding ahead, he asked me, hey, do you want to be a business partner with me? Dynamic really had no revenue at that time. It was really just Isaac dreaming and kind of getting stuff started. So I co-owned Dynamic 50-50 with Isaac. I came on
Austin Blanchard: board full-time in January of 2023. And we are on a run rate to break past 5 million this year. and it’s been 100% organic growth. We’ve had no loans. We have had no institutional investors. We have acquired no businesses. Every bit of revenue has been pure organic growth.
Austin Blanchard: And there’s some larger projects that are thrown in there. We’re doing a large project this year in South Carolina, which is going to be a little bit atypical for our industry. But yeah, it’s been a blast. And I think last week we just hired our 20th full-time person.
Tyler Martin: Wow, that’s really cool. 20 people, that’s a nice size. So, okay, great. What about something on a personal note? Anything, any hobbies, anything you’re into?
Austin Blanchard: Oh, man. My stage of life right now is I have three things that I’m really interested in. My work, my family, and my church. Not in that order, right? You can kind of just say I’m all, they’re all similar priorities in my mind.
Austin Blanchard: Between me and my business partner, we have nine kids. Okay. So Isaac’s got six kids. I’ve got three kids. And we’re each, I mean, we’re each of our early 30s. And so we’ve been busy. We tried to get after it in our 20s.
Austin Blanchard: And so I have three girls. I have three daughters and my oldest is four.
Tyler Martin: You’ve got your hands full.
Austin Blanchard: Yeah, life right now is just, you know, trying to figure out how to be a girl dad, how to balance all of those things, how to be present when I’m home, which is super, super, super challenging. I’m just, you’re trying to run a business and your phone is being in all the time.
Austin Blanchard: And just, you know, when you’ve been in kind of the growth and the scale patterns that we’ve been in, I’ll just be your wife has to be 100%. Your partner, your spouse has to be 100% on board or it’s just not going to work.
Austin Blanchard: At least that’s my experience, you know. So, yeah.
Tyler Martin: So, let’s start with this partnership that you have with Isaac. Partnerships can be difficult. They’re very similar to marriages. How has it played out so far? How do you guys, at least so far in your relationship, how do you navigate through that? So there isn’t friction or you guys are, are you staying in your own lanes or what are you doing that’s making it effective?
06:02How they split opportunities and execution between them
Austin Blanchard: Yeah. So two things I think that we started out with that built the foundation for kind of where we’re at. So when we were going through this exercise, there was a three month period of time where I didn’t say yes. It was basically Isaac and I just sitting down and figuring out what is this going to look like?
Austin Blanchard: So when that three-month period happened, we basically said, Austin’s going to be responsible for opportunities. He’s going to be responsible for generating opportunities, for generating quotes, all of that stuff. And then Isaac is execution. So to this day, that is basically still how we function just on a much higher scale.
Austin Blanchard: So opportunities are still in my world very much, and then execution is still Isaac. And even the way where we divide the company, we have a service and a project organization. So that was is critical. And me just going like, yeah, like I can do that. I can help you in that way. And our skill sets are mutually compatible. Right. And so what Isaac is strong in, I’m not strong in. Isaac is highly technical, highly talented in the field. And I’m not. You don’t want me working on your HVAC for a multitude of reasons. I can sell you a new system, but I can’t fix what you have that’s broken.
Austin Blanchard: and the areas that I’m strong in, Isaac, he maybe could be good in them, but he doesn’t want to be, right? And so that foundation was super, super good. We wrote out a business plan. We wrote out a partnership, kind of a draft where we each said,
Austin Blanchard: this is what we’re going to do. We each outlined our shares of the businesses. What happened if one of us died, right? Like all of those things we had lined out in those three months so that in January, all I did was just sign a piece of paper.
Austin Blanchard: So that foundation was really good. And then we also, I will say, we also share the same faith. So we are followers of Christ. And that to us is incredibly important because the way that we view the world and everything is going to be through what we would consider like a gospel-centered lens.
Austin Blanchard: And so that foundation for us is absolutely critical. Isaac and I live in the same neighborhood. So our lives are fully integrated. The only thing we don’t do that is shared would be we go to different churches. I see him all day at work and then our kids play together.
Austin Blanchard: Our wives are really good friends. And we are at this point kind of like family to each other. We are really honest. So we get into a lot of arguments. And you can’t, in my mind, you can’t function in this kind of an environment in a high pace, high grit top, if you’re not able to have really honest conversations with your business partner.
Austin Blanchard: But it’s kind of rooted on a foundation of, hey, I’m for you, I’m with you. we’re driving toward the same goal. We might not be aligned right now, but the only way to get us across the finish line is, is if we can have hard conversations. And so we don’t pull punches. I
08:52Why arguments default to whoever owns the outcome
Tyler Martin: mean, we go after, we go after it when we need to. So how do you deal with though, when like you’re having one of those arguments and you know, you have philosophically different views, how does that play out? Like who, who is there one of you that tends to get, like, since you’re more on like
Tyler Martin: the system side is generally, you’re going to be more gospel on the system side and maybe he’s going to be more gospel on the technical side or how do you balance that typically we will default
Austin Blanchard: to the other person’s realm of business so like technically got it right like i might have a different opinion in terms of how we should be training the guys or how we should be handling the projects division but at the end of the day isaac’s going to be responsible for that work
Austin Blanchard: so right really whoever is ultimately accountable right for that that’s going to be where the decision rights lie at the end of the day. And also, I don’t know, I think that each of us just, we each really trust the other person. And so in our arguments, both of us, I think,
Austin Blanchard: always take a stance of, I’m always willing to admit that I’m wrong. And sometimes I just need to argue with you to figure out that I’m wrong. And we don’t take arguments from the position of, I’m always right. It’s, I think I’m right. Help me understand if I’m not right. And I will say
Austin Blanchard: each of us, we try super hard to have a decent level of humility, recognizing that we might not
Tyler Martin: be right all the time. Sure, sure. Okay, so good stuff. Getting into, like you said, you’re roughly around 5 million is your pace right now, is that correct? Yeah, we’re pacing. If you look at this year, we are pacing for 5 million. Yeah. With you being more of like the systems guy, is there
Tyler Martin: something that in a non-technical, I’ll say maybe it’s a better way to say it, non-technical, where you’re not going out and doing the jobs, where did that force you in terms of what things did it force you to kind of focus on? Like, was it systems? Was it hiring design? Like,
Tyler Martin: what are your big things do you think that you’ve said, oh, okay, this is where I’m going to add
Austin Blanchard: value to the business and make a difference? Is that sales, really? Sales, yeah. I mean, Isaac is so talented in a lot of different ways. He’s actually a little bit more of a, we’re each systems guys. So we’re each actually, that’s our overlapping skillset is we can each
Austin Blanchard: get into systems really, really quickly. Okay. Isaac is going to think through him in terms of a technical perspective, like how can I accomplish technical work with these systems? And I’m going to think through the holistic organizational approach, right? Like, you know, I was the one
Austin Blanchard: that kind of created our organizational chart, our 2030 vision, what we call position contracts, where we outline clearly the expectations of each role. Isaac is going to be more nuts and bolts. How can I use systems to get jobs done? But for me, early on, man, Isaac didn’t want to sell.
Austin Blanchard: He just wanted to get work done. And so this has kind of come back to bite us a little bit over the past six months. But really, I just said, hey, I’m going to just sell. I’ve never sold in the home or commercially before.
Austin Blanchard: but I think a lot of it is just,
12:01Blurring the line they drew between service and sales
Austin Blanchard: you kind of have to have just clear communication and make sure that you know what you’re quoting. And so I just kind of figured out how to quote stuff, figured out how to quote it in all three trades. Cause I basically said, if Isaac can, can do it,
Austin Blanchard: then I’m going to just try to sell it. And so that’s how we did. That’s how we did it for the first two years.
Tyler Martin: When you said it’s kind of come up to bite you a little bit. What do you mean by that?
Austin Blanchard: We, I think unintentionally created this element of separating service from sales. Right. So we basically said like Austin’s world, these higher ticket items. Somehow we’re just able to kind of generate $10,000, $20,000 when Austin goes out and we’re going to call that sales. And then we’re going to call this service over here
Austin Blanchard: where service is like a service call. A technician goes out, he’s still quoting the customer, but that’s not sales necessarily. And so over the past three, four months, we’ve really just kind of found all of that pre-job execution. We’re going to just view what we call now as
Austin Blanchard: a service, right? It’s when you have to present a quote to a customer for work, which we do every time before we actually go forward and move forward with the project, it’s going to be service. So what I do at this point now is service. I’m providing a service for a customer in the form
Austin Blanchard: of a quote. They can choose to proceed with us or they can choose not to, but it’s still going to fall under a service category. And when I’m actually out in the field selling, I put myself under our service manager. And so there was a period of time where I think Isaac just kind of
Austin Blanchard: wanted the technical elements of the service department without the sales elements. And we’ve had to just kind of, that’s been what some of our heaviest arguments have been over, is trying to figure out how you blend those two where you’re still providing that technical
Austin Blanchard: experience, where we’re sending out guys that are not just salesmen, like some companies do, to fix a problem. These guys are actually trained. They’ve got their EPA certifications. they have their tools, they can fix the problem, but their primary job is to diagnose the issue and present options to the customer.
Austin Blanchard: And so that separation, we just had too much of, I think, for a little bit too long. And so we’ve corrected
Tyler Martin: that now, I think. Yeah, I was going to say, how do you correct that problem? How do you bring those together
14:12Splitting the company into service and project teams
Austin Blanchard: a little bit more? We split the company. So it sounds like a lot, but it was actually, we already have almost all the elements in place. So we basically just said, Hey, projects are going to roll up to a project manager. When a job is sold, when that quote’s approved, all of that now funnels under a project manager.
Austin Blanchard: And for service, pre-quote, from request to quote, that’s going to fall up under the service department. And actually, we now have it to where Isaac is kind of like a branch manager, where all of those people actually just report to him. because at the end of the day, it’s too difficult as you keep growing for those two organizations
Austin Blanchard: to roll up to different people. So Isaac at this point is like super crystal clear on what needs to be done. And so both of those roles now report to Isaac and he’s kind of operating in like a chief operations officer or something close to a branch manager level.
Tyler Martin: Interesting. So just from a mechanical standpoint, you get a service call, technician goes out there, what does that look like? I mean, if they’re operating kind of as different, I’m just trying to get my head around this. They’re operating as like kind of different
Tyler Martin: companies, so to speak. What does that, let’s say, let’s say it needs to be replaced or it’s even borderline. How does that get handled? Yeah. So three trades, right? So we need HVAC
Austin Blanchard: electric plumbing. Yeah. HVAC is the easiest to talk through in this example. Sometimes it can
Tyler Martin: get a little bit complex, but we basically roll guys. We roll our service guys in a light vehicle. It’s going to be a maverick or a ranger. And they’re going to have general tools that they need to fix the problem. The most commonly, the things that break the most commonly,
Tyler Martin: they’re going to have rescue motors, common unsafe pumps. They’re going to have capacitors, contactors, et cetera. They’re going to have refrigerant. They’ll have some refrigerant as well. But they’re not going to be in a transit. They’re not going to have $100,000 worth of inventory.
Austin Blanchard: Got it.
Tyler Martin: Because they are primarily there to just diagnose the problem. So they roll up. They go through their, what we call our service cycle, which we are still in the process of trying to figure that out. And they’re basically going to diagnose the system,
Tyler Martin: follow their checklist, and then come back to the customer and say, hey, this is what’s causing your issue. This is what you need to get it back up and running. And then these are the things I’m going to recommend. And so what we have found is that a lot of times
Tyler Martin: customers don’t necessarily want it fixed immediately. They just want to understand, well, when can you get it fixed? And so if it’s something small, right, and typically we say that between $500 and $1,000, our hope would be that we can fix that while we’re there.
Austin Blanchard: Sure.
Tyler Martin: If it’s a capacitor, right, which we always say it’s never just a capacitor, right? But we give customers the option to just replace the capacitor. If they do that, look, throw that bad boy in and move on to your next one. We’re trying to work on slowing down and diagnosing the whole system.
Tyler Martin: But a lot of times, if it is just something small between that $500 and $1,000, we’re going to say, hey, go ahead and knock this out while you’re there and we’ll readjust your schedule. until you get this done. But our hope would be that we are basically able to say, hey,
Tyler Martin: I need to get to my next call. Let me go ahead and get you on the schedule since you wanted to forward this work. So customer approves the quote. We have that service technician caller on call or on-site dispatch, which is currently Isaac right now. And Isaac will basically pull up the
Tyler Martin: project schedule and he’ll assign that to the project team. It could be as soon as an hour that somebody else is out there doing that work. And they’re going to roll up in a bigger vehicle in a transit or something like that. And their goal is literally just get the work done.
Tyler Martin: Get the work done. And what we have found is it’s just too hard as you are trying to do three trays, you’re trying to scale to combine both of those into one person. What we have seen and really looked at the best, the highest functioning companies,
Tyler Martin: almost all of them have separated the service and the projects division. And I will say like our service and our projects managers talk all the time. They’re constantly talking. They are in sync.
Austin Blanchard: with what needs to be done. But does that make sense? Yeah, totally. I mean, I feel like I could turn this conversation into an hour and a half. So I got to keep moving here. I’m probably not giving it justice, but I appreciate all that detail. Where I want to move into is you guys
Austin Blanchard: don’t hire technicians with more than a year of experience. And that sounds to me like when I
18:27Why they refuse to poach and train green guys instead
Austin Blanchard: first heard you say that to me for a small company. Now I get if you’re a $50 million company and you have a training academy, that wouldn’t sound that weird. But for a small company, I’m like, wow, that’s a lot. Because I think the amount of time it takes someone to get up to speed.
Austin Blanchard: So can you kind of walk me through what’s your reasoning for that? And how do you overcome the timeline that it takes for someone to actually become productive?
Tyler Martin: of. So, and I constantly just, that’s Isaac’s vision through and through. And so when we, when we were starting out, I’m like, do you think that you can actually do this? Like, we’re going to try to hire people without skills and you’re just going to train them.
Tyler Martin: And he’s like, yeah, that’s what I want to do. And so I think what we have found is we have, this is our third and a half year in businesses. Business is freaking hard. I mean, I would not tell most people to try to start a business unless you really just absolutely are so passionate about
Tyler Martin: what you’re doing. So what we have found is like money to us is it’s important. We want to provide a good income for our people and for our own families, but it’s not the primary reason that we’re in business. So one of the things that I derive no satisfaction from is getting to play
Tyler Martin: what we consider getting to play the game, right? With people that we like. And so the industry, I think, and I’m going to throw a little bit of shit on the industry, is it has always operated in just a historically, and it’s been changing.
Tyler Martin: But, you know, for the past 40 years, the industry has really produced a kind of person that, to be honest with you, I’m not sure if I would want in my home. And, you know, they’re talented technically. But at this point, technical, you can train technical.
Tyler Martin: And so Isaac just basically said, look, I love to teach. I love to train. Let me find guys and let me train them. And so that’s what he loved to do. And so our first, yeah, so our first two guys, one of them didn’t make it.
Tyler Martin: He’s fine. He’s just working in a coffee shop now. That’s totally cool. But our other guy, he was working at the sandwich shop before we hired him. And it’s been two and a half years, I think. And he’s now what I would consider a master level electrician.
Austin Blanchard: That was your first electrician. That was your first electrician too, wasn’t it?
Tyler Martin: Yeah.
Austin Blanchard: Okay.
Tyler Martin: Yep.
Austin Blanchard: So he was our first, he’s our first electrician. He’s probably out there somewhere in our shop right now. He’s still with us. And electrically, I would consider him to be like a master electrician level. He can work commercial. He can work residential. We send him on industrial jobs every now and then.
Austin Blanchard: And so Isaac just really has an act for training people. And he has an act early on for finding people that we’re going to be training. So in terms of the sustainability of that, it was really hard for the first two years. And really, without Isaac, I would have never been interested in doing it because it was really just Isaac on the phone constantly, right?
Austin Blanchard: Just taking calls, walking guys through stuff. But now we have built a little bit of a buffer where we’ve kept the majority of the people that we’ve hired in those first two years. And so now as we bring guys in, those people that Isaac has trained are training our younger guys, our guys.
Austin Blanchard: So Isaac is not training those younger guys anymore. He’s still working through the top guys, making sure that they’re still at their kind of expert level. And those guys are through ride-alongs or through other areas. They’re training these younger guys. It is very challenging.
Austin Blanchard: And the reality is there are a lot of pros with it and a lot of cons. The cons are you’re going to get callbacks. you’re going to send 240 to a control board and blow it up. You’re going to leave disconnects off. I will say that Isaac has a higher
Austin Blanchard: tolerance for that kind of pain than what most people have. He’s just willing to endure it. Isaac is the highest level of tenant. We have 600-something five-star abuse. When we’ve made mistakes, we’ll just figure out a way to fix it. And there’s never been a mistake that we’ve made that somebody in our company has not been able to figure out a solution to.
Austin Blanchard: So that knowledge base and Isaac’s confidence in his own skill set has kind of enabled us to build that up. But the biggest thing is that the guys that we hire are like, we want to be winning and we want to be in this game with them.
Austin Blanchard: And so as long as they’re willing to work hard and as long as we have what’s called our internal guiding principles, it’s 10 principles. as long as they’re abiding by those 10 principles. Basically what we say is you get to work with us
Austin Blanchard: and we’re going to do what it takes to help you win. So I would not encourage most companies though to try to do this because without Isaac, it would just, it probably early on, right? Like, yeah, to your point, when you get to that 15 million range
Austin Blanchard: and you can develop a training academy, that’s awesome. I’m super jealous. But when you’re, but I will say we have so much competition in our area. we have there is so much competition we’re in east tennessee i mean you can throw a stick and
Austin Blanchard: hit 10 other hvac contractors around us and those companies have been established for years and so those companies have historically pulled the best technicians into there and they’ve been able to pay them and everything so it’s almost like to sometimes i do feel like we didn’t even have a
23:48What they screen for: ownership, positivity, we before me
Austin Blanchard: choice if we were going to try to grow like we’ve grown we we’ve had to to grow our talent in-house
Tyler Martin: Yeah, you would have to have real deep pockets to probably sway some journeymen or master skill set people over to your shop, which means you’d have to have funded it. Yeah, that’s interesting. Okay, so what do you look for? So the electrician, I believe, you pulled from a sandwood shop.
Tyler Martin: What are you seeing in this guy that said, hey, let’s give him a shot?
Austin Blanchard: So for the majority of the people that we hire, they’re basically going to go through three rounds of interviews. And I will say Indeed is a wonderful tool. I mean, we are constantly getting legitimate applications on Indeed. There’s a lot to go through and there’s a lot of pointless applications, but there’s
Austin Blanchard: realistically about 10% of those are going to be some gems that you’ve gotten there. So a lot of the things that we’re looking for, number one, is do you take ownership in your work? Are you willing to be held accountable when you’ve messed up?
Austin Blanchard: if you’re going to make excuses, this is not the place for you. We can’t, we don’t tolerate that kind of a behavior. The culture that we build here is very much own your mistakes, be willing to be held accountable by somebody else for your mistakes and just
Austin Blanchard: move on. It’s not a big deal if you make a mistake. So ownership, taking accountability, those are, those are huge things that we look for positivity. So that’s actually our first guiding principles and enthusiastic positivity. Super weird. We hired one guy, his name is Mitch.
Austin Blanchard: We literally hired him just for his attitude. And he’s incredible. He’s our shop and warehouse manager. He literally, he works his, I mean, he probably pulls 50 hour weeks. Nobody asks him to. He just takes a high level of ownership and he is a joy to be around.
Austin Blanchard: He’s always positive. Anything that gets thrown in his way, he’s able to come up with a solution. Positivity for us is probably a, it’s a huge thing that we have literally, we have let people go because they have been consistently so negative that it’s affected
Austin Blanchard: other areas of their performance. And then it’s other things like we have one selfless solidarity, we before me, where it’s just this simple concept of, do you view like it’s just you and you’re only concerned about yourself? Or can you expand your brain and think I’m part of the bigger
Austin Blanchard: picture? I’m part of the team. I’m working toward a goal, all that kind of stuff. I mean,
Tyler Martin: I can keep going. We have 10 principles that we like. Yeah, that’s good stuff. So your slogan kind of is character over skill on top of that, right? Like you kind of, it’s just about character first. You know, just going kind of back to this training methodology, do you guys have, what
Tyler Martin: does that look like? Like if you hired me tomorrow, a guy that’s literally the least handy person on the face of the earth, but hopefully has the right character.
26:39The 90-day probation and riding along with specialists
Tyler Martin: What timeline are, like, what are you doing? Am I riding along with Isaac for three weeks? At what point do you expect me to start making a little bit of money? What does that look like?
Austin Blanchard: Great question. And you’re catching us right in the middle of really trying to firm out these things. So it’s fun to have this conversation. It is. If you were to come aboard with Dynanek right now, we’re obviously going to be assessing that character on the front end through multiple interviews, right?
Austin Blanchard: When you join us, you’re going to hit a 90-day probationary period. Okay. This is for the technicians. And we basically say everybody that enters with us, because we’ve never really hired for experience, is going to enter as this junior-level technician. And you can accelerate out of that if you’re just killing it.
Austin Blanchard: But you’re going to have a 90-day probationary period where everybody’s going to be watching what you do. And you’re going to be getting feedback 30, 60, 90 days. And in that probationary period, we probably should come up with a different name for it.
Austin Blanchard: But you’re not necessarily going to be eligible for PTO, for the benefits that we offer. That’s going to come after that 90-day period. So you’ll start. we do have a rough training that we have been putting a couple of people through like a three
Austin Blanchard: day training program put on by sam our project manager and then dustin our service manager but in all honesty we’re literally going to throw you in a truck and you’re going to ride along with somebody that is what’s called a service specialist or a project specialist and those
Austin Blanchard: people are going to be guys with the most experience here they’re going to have a really good technical depth. They’re still going to be on the phone with Sam, who’s our project manager. And then if they need to talk to Isaac, they’ll still be on the phone with him,
Austin Blanchard: but they’ll be responsible primarily for getting the work done. What we’re basically trying to look for at that time is two things. Does the character that we believe that you have, do we feel like it’s going to be able to be held up in really difficult
Austin Blanchard: situations and hot addicts, et cetera? Do we think that there’s a long-term place for you here at dynamic and the second thing is do you have a technical aptitude right so the project and the and the service guys are going to be giving feedback to our managers on the newer guys that
Austin Blanchard: we hire and we take that feedback super seriously because we know that they’re going to be having to work alongside those guys if they get out of their probationary period so we’ve got a couple guys in that probationary period right now one of them i don’t know there might be some guys that don’t
Austin Blanchard: make it kind of that probationary period and what we have learned is to be very critical with in that window so that if it doesn’t work out, there’s a, if we let it go too long, it just becomes more difficult to let that person go. So we don’t have necessarily like a perfect,
Austin Blanchard: a perfect path necessarily, but I can tell you this one, one guy we’ve hired, he’s been with us about six months and he’s got a aptitude for electrical. He’s just passed his, yeah. Yeah. He’s been out on this probationary period for a little bit and he’s, he’s running electrical calls
Austin Blanchard: on his own. Base level, we vet the call to make sure it’s going to be something that matches up to his skill set. And we send them out to the call. And if he gets stuck, he has people that he can call. So six months to a year. When you’re dispatching, are you kind of then going,
Austin Blanchard: oh yeah, this guy just got through his probationary period. He can only handle, I’ll make this up level one issues. Do you have, is that a sophisticated process or is it more like gut feel by whoever’s doing dispatching? Dispatching has always been handled by the project team for projects.
Austin Blanchard: And so they were hand-selecting the jobs that have been sold. They were reviewing the scopes and they’re saying, this is something that this person can handle. So we’re going to send out this guy. This is going to be more of a specialist level type of job.
Austin Blanchard: And the reality is, is, you know, a lot of our revenue comes from HVAC installations and an HVAC install. I mean, it’s kind of the same thing every time, more or less there’s going to be nuances but you can you can learn and scale hvac installs pretty
Austin Blanchard: quickly and so for our guys we just one of the benefits that we have said is while we’re in these early stages you’re really going to you’re going to have to go wherever we put you if you don’t like being in a crawl space if you don’t like being in a hot attic this is not the right
Austin Blanchard: company for you if you like only doing a certain kind of job or if you have in your head i just want to do HVAC. I just want to do this certain skill set. You can go to trade school. That’s cool. There’s no harm in that. It’s just not going to be the environment that we’re in.
Austin Blanchard: We look for guys that literally just love to get after it. And they’re more than willing to go wherever we send them. So most of our guys at this point have a decent amount of experience in HVAC and electrical or HVAC and plumbing. Okay. Which leads into my next topic I wanted
Austin Blanchard: to talk about. Someone comes aboard with you, you train them on how to do HVAC, you’re pretty much telling them early on, like, hey, pick another trade because we’re going to have some slow periods and you need to be doing something else. And you’ll train them, I believe, in that other trade.
Austin Blanchard: So what’s that look like? Because to me, that, I mean, like, honestly, that bends my mind a little bit because first we’re like training the people out of the gate, which I think is, Isaac is a saint, by the way, because training is tough. Like it is, especially when someone quits, man,
Austin Blanchard: And that’s like, you just feel like three months of your time or six months goes, you just threw it away. So tell me how that method, how that process works. Like, so, and how you maintain quality that you’re training someone on multi-trades. What’s that look like?
Austin Blanchard: What’s that conversation look like? And how do you execute on it? So early on, right, it was Isaac as the standard setting of expectations. when we were in the zero to $1 million range. And we just had a couple of guys. So Isaac was in the field,
Austin Blanchard: riding with those guys, training them and setting that expectation. Mitch is out of our first hires. We hired one, two, three, four, five guys and four of them are still with us. So that expectation and standard that Isaac set is now being set by those guys in the field.
Austin Blanchard: So Sam is our project manager. We’re just kind of a weird company. He lived in my basement for a year with his whole family and his brother-in-law. He was a teacher, but I’ve never seen anybody pick up a trade faster than him. He, within three months, legitimately could handle…
Austin Blanchard: I know it sounds crazy saying this because if people listen to this, they’re like, oh my gosh, how are these guys functioning as a company? But it actually really does work. You really just have to find the right people. That has been probably the hardest part of our business.
Austin Blanchard: and it’s always been what we’ve said, we’re going to grow at the pace that our employees allow us to grow. And that has been what we really have kind of done so far. But for these guys, Sam is now our project manager and he just sets a high standard of expectation for the guys.
Austin Blanchard: So he’s going to put his younger guys on opportunities and he’s going to give them hands-on experience. There’s going to be a lot of guys if they mess up. They’re going to be with people who do know what they’re doing and they’re going to be taught on the job.
Austin Blanchard: 90% of our training is on-the-job training in customers’ homes, in facilities. We don’t shy away from it. Hey, we’re going to have a young guy here. He’s going to be doing this. He’s going to be under the supervision of older guys. We’ve got that down.
Austin Blanchard: We’ve literally never had an issue. And I guess, I’ll knock on wood, but in three or four years, we take a tremendous amount of pictures through company count. So on average, we’re probably taking about 1,000 pictures a day. And we have video monitoring just through,
Austin Blanchard: through company cam where before we leave a project or a job, there has to be documentation about what was done. We’ve got multiple people, Dustin, Sam, Isaac, everybody’s monitoring company cam to make sure that stuff is looking right. It slows down our, it slows down the work for sure. Sure. Sure. But it’s,
Austin Blanchard: it’s just, we’ve done it since day one. I mean, we, we, I could probably look and see how much we’ve probably taken close to at this point, we’ve probably taken close to 1500 pictures already today because we’ve got probably 10 or 15 jobs going on right now. That’s crazy. And that’s a huge way where we do monitor quality.
Austin Blanchard: So it’s interesting, something you said to me, because I was originally thinking, and you said something opposite of what I was thinking. I was thinking, oh, wow, if you can train your own people, you guys really can write your own ticket because there’s a
Austin Blanchard: perception of that a little bit when you can train your own people that it’s really just a matter of, Because one of the biggest barriers is being able to find qualified technical people. I mean, for most of the clients, at least I work with.
Austin Blanchard: But you’re saying it is hard to find high character people. You’re still challenged by finding the people that you want to invest in. Is that correct? Yeah. Wow. And I mean, it’s not like we’re paying people a ton of money.
Tyler Martin: Sure, sure, sure.
Austin Blanchard: Yeah, it is definitely. And we have high standards. A lot of the people that we have working for us, we have found within our own personal networks. And so like Mitch Personal Network, Sam Personal Network, Dusty, our service manager, Gina, all of that is personal.
Austin Blanchard: So probably about at this point, 50% of our company has come from individuals that we knew pre-Dynamec and that we felt like would be a good skill set within. We’ve also, so take Marco. Marco found us online when he was in, I don’t think he’ll have an issue of this. He found us online when he was in Minnesota and found our website, applied to a job, and he was planning to move down here anyways.
Austin Blanchard: And he just basically, on his way down to Tennessee, interviewed with us, and he’s been working with us for six months. So we also have people that have just really fallen into our lap. And when you are young and when you are growing as a company, you have to try to use that excitement to attract people into your company and get them caught up in that vision.
Austin Blanchard: And I do think that we try to do a really good job of that. And I think that that has helped us pull people in. It is still very challenging. And I think at this point, we reject probably 90% of applicants that we see come through Indy.
Austin Blanchard: It is hard and it is challenging. And it is something that will, as we keep growing, it will probably be the number one limiter of our growth.
Tyler Martin: Sounds like it. Okay, I want to spend time in a couple other areas. And I appreciate, you know, just your candor and transparency. I want to talk about, I have a segment called The Number. and I like to just pull out one or two numbers
Tyler Martin: that are important to you as a company. They don’t have to be your exact company numbers. They could be benchmarks or ranges. So I’d love to know if, you know, maybe it’s revenue per tech or something along those lines. Are there a couple numbers that kind of stand out to you,
Tyler Martin: one or a couple, that you guys kind of drive the business by?
Austin Blanchard: Yeah. So let me pull up some stuff right here.
37:32Merit-based pay and the gap against hourly wages
Austin Blanchard: so we’ve got we have a lot of metrics that we have really just started to to track so on our service dashboard we we are tracking the typical things that i think that our industry tracks we’re tracking average ticket we’re tracking win percentage by value basically the
Austin Blanchard: total total opportunities you have divided by the percentages that you want that is a sobering metric is, yeah, you really, yeah, that’s been interesting for us to kind of watch that. So on that side, we definitely have a lot of visibility per technician into the dollar
Austin Blanchard: amount that they generate for us. And over the past 90 days, we have created something called merit-based pay, which, I mean, it’s not native to the industry, but it is very custom tailored specifically to how your presence in our company either helps generate revenue or helps to execute revenue.
Austin Blanchard: And, um, one of the things that we basically look for is we pay all of our guys at base, a base hourly rate. So, and we’ve to this day, if a guy has worked 40 hours, we’ve always given guys the opportunities. We’ve always given guys the opportunity to work 40 hours since our company has started.
Austin Blanchard: And we have basically said that the number one metric we’re looking at right now is the gap between your merit-based pay. And then your hourly, because we pay whatever is greater. so let’s say that uh you know and there’s a calculation for merit-based pay that we have
Austin Blanchard: on our service guys and our project guys so let’s say that you’re making 25 an hour right whatever that bi-weekly pay is if you’ve worked overtime or whatever your payout let’s just say it’s 2500 bucks okay if your merit-based pay is under that 2500 what that tells me is the dollar amount that
Austin Blanchard: we paid you, you did not earn back to the company. So the company was at a loss during that period. If you are exceeding your hourly pay by your merit-based pay, then what that tells me is you are firing on all cylinders and the company is paying you the maximum amount that they can pay
Austin Blanchard: you for the value that you’re creating for the company. Because we basically just divided up 10% of the project, 10% of the cost of the project goes to our service side, and then 10% goes to the project side. So, you know, just say theoretically, somebody sells a project for
Austin Blanchard: $10,000, $1,000 is going to go to the service bucket in the merit-based pay, and then $1,000 is going to be eligible for the project team when they complete the work. And there’s a lot of other nuances with that. It’s not that simple. So, it’s basically if an inside salesperson steals it,
Austin Blanchard: Or if you need to call technical support while you’re on site, there’s some other things there that we factor into play. That’s basically the number one thing we’re looking at right now because it’s very new to us. And so we’re trying to understand for the guys that are way under.
Austin Blanchard: So they’re clocking hours, they’re clocking overtime, we’re paying them a good strong wage, but their merit-based pay is way under that. There’s a gap there between what we’re paying them and the revenue they’re generating for the company.
Tyler Martin: So, yeah, that’s great. I mean, without getting too deep in the weeds of the numbers, though, if they’re falling under, if their merit-based pay is under that hourly wage, what’s that looking like? Are you having a conversation with them? Are you, Isaac, collaborating over this first before you go and talk with them? Or what’s that look like?
Austin Blanchard: So service is going to roll up to the service manager, Dustin. And so Dustin is their direct supervisor. This is super new to our company within the past 90 days. And I think it’s just been really eye-opening to us to see some of the gaps and to see, hey, this guy is looking like he is super busy.
Austin Blanchard: Right? But why is the revenue generation tied so much more to this other person? it’s really given us a lot of clarity just in terms of who we need to focus on and then what we need to focus on. And so, yeah, if, if some of our, if, if that gap does not shrink, there’s
Austin Blanchard: going to have to be not hard conversations, but just trying to understand why, what is it about this gap that isn’t making sense? Because what we basically say is you take your salary, right? You take your hourly rate, times it by 36 or whatever it is.
Austin Blanchard: And then that’s basically what you need as a service person, the dollar amount of quotes you need to be responsible for per month. So let’s say that somebody has the hourly rate that equals out to about $50,000 a year. Okay, well, you need to be selling about $5,000 a month or $50,000 a month.
Austin Blanchard: So that dollar amount is a huge guiding light for us as we continue to work through standardization. And it has been something that has been tricky for us to really kind of have our guys wrap our heads around because we have never been overly focused on money.
Austin Blanchard: We have always been focused on this service-first mentality. We are not interested in high-pressure sales. There’s too much of that already in our industry. But the reality is the better you are at diagnosing, the better you are at presenting options to the customer,
Austin Blanchard: you are going to see a revenue association. next to your name. And that’s not a bad thing, right? We need that to stay in business and
Tyler Martin: continue to exist as a company. So it’s a good topic. It’s interesting. I mean, I think we could dig even more because at some point you do have to look at your rate of return on a per technician level. And it comes down to, you know, it sounds like you guys are still
Tyler Martin: growing and evolving in terms of how you handle that, but that’s the reality of business really. And do you guys, I know you’re not necessarily, you’re thinking service first and then profit, of course. Do you have a target where you go, hey, we want to be at 10% net profit or we want to be at 15% net profit?
Tyler Martin: Do you have anything that you guys necessarily look at and think, focus around?
Austin Blanchard: So 10% profit would be the minimum that we would target. And what I would say, like, we would say the minimum would be the NIAT, net income after tax would be 10%. That would be the minimum. EBITDA would be higher on that. Historically, we have operated, and this is, we’ve historically operated over a 20% EBITDA.
Austin Blanchard: And that number, if you actually delve into our books, there would be multiple reasons for that number that would not necessarily be related to operational efficiency, but more of just some of the benefits of being a smaller company. Like we have, we bought a shop in five acres and we put that through a different company
Austin Blanchard: that we own. And the rent that we pay is super, super cheap. And Isaac and I salaries, we, we pull very little from the business. Yeah. Very little in proportion to the revenue that we generate. And so there’s going to be manipulations that make that number higher.
Austin Blanchard: But as we kind of continue to work this out, Our goal would be 15% EBITDA, 10% NIAT, somewhere around there. And then if we could get closer to 20%, you know, I mean, that would be awesome. But we have a long way to go before I think we get there.
Tyler Martin: It’s impressive. You know, one thing I love you just brought up, and it’s just so important for folks in the audience when they’re hearing numbers to just consider these facts. Because we hear so many things on the internet. And you could have easily said, hey, my bottom line is 20%.
Tyler Martin: And you could have left it at that. and you said, hey, you know, we as owners, the company might be a little undercompensated for what work value we’re creating. You know, we bought some property and we’re running, we got a substantially lower lease than we might have to. If you don’t bring that all up and you
Tyler Martin: just say 20%, people are sitting out there in the audience and go, wow, why am I only 11%? Why am I only 13%? And they’re getting frustrated. And there’s so many devil in the details with the
Austin Blanchard: numbers that I appreciate you bringing that up. Yeah. I mean, you can kind of make the numbers saying what they really wanted to say. A private equity company would probably not be interested in our business right now because if they really dove into our numbers, they would probably
Austin Blanchard: maybe, I don’t know, maybe they would be, but if you really looked into our numbers, you’d be able to say, well, he is probably way under market value of what you would expect, or are you really only paying your technicians this amount? Like, you know, we know the industry standards of, you know, we want to have about 20% direct input for the cost of labor and the job.
Austin Blanchard: We want to have about 30% of the cost of materials and target that 50% gross profit margin. We actually have a bonus for what we call our core team, where their bonus is tied to the gross profit margin of the company. and that is the number that we’ve kind of tried to hit because Isaac and I still,
Austin Blanchard: we influence way too much the number below gross profit margin. And obviously between gross profit and EBITDA, you as the owner, if you have a lot of flexibility in your business financially, right? If you want a nice cup of coffee, right? Make sure it’s a business expense, but you can,
Austin Blanchard: you can do a lot of things where you are influencing the bottom line without even realizing it.
Tyler Martin: Yeah, that’s a great point.
Austin Blanchard: You know, we know how we’re influencing it. It’s just, it’s going to be one of those, you could look at it either way, probably work on of being a small business center.
Tyler Martin: Yeah. Okay. I got one more topic, just a few minutes here left, unfortunately, because I started late, so I apologize. But I want to spend just a few minutes talking about service titan tends to be thought of
47:16Building a custom back end on Jobber, not Service Titan
Tyler Martin: as the holy grail when you’re thinking about scaling a company and becoming a $10 million plus company. you and I in our pre-call we talked about and you were kind enough to show me you’ve built a back end to jobber is the tool that you’re using and you’ve got some beautiful you’ve got a three-day
Tyler Martin: call board you had a project schedules warehouse credits all it’s all feeding into jobber and you guys have made a conscious decision that you believe jobber can take you to 10 million 12 million you know which is interesting because generally when I think of jobber and I’ve used
Tyler Martin: it and I’ve used other products, similar, Housecall Pro and things like that, you kind of start to, there’s a lot of moving parts, 5 million. I’m not saying it can’t be done more than that, but I’m not sure I would necessarily advise it. Talk to me a little bit about your conscious decision to
Tyler Martin: say, hey, Jobber can get us up to 10, 12 million. We’re going to invest in the backend, which are really cool, by the way. Let’s talk through that for just a few minutes. I’d love to know your
Austin Blanchard: thought process. Yeah. So I’ve never actually looked into Service Titan. I just know that it is a very robust program that a contractor of our size is never going to necessarily get the support that we get as we’re trying to do things. We are a very flexible company and we
Austin Blanchard: move really quick. So a lot of the stuff that we’ve kind of gone over that three-day call for the project schedule, Isaac, I don’t know how long it took him. He might have just stayed up all night and just created it. And a smaller software-like jobber allows you a ton of flexibility if you
Austin Blanchard: know how to use those APIs. And what’s crazy, the pace that the world is evolving is just ridiculous. I mean, you can literally code in Claude, double check it in chat, and it might actually work. And you just have to understand really at this point, how do you code in English
Austin Blanchard: and how do you fix stuff when it breaks it. You can get yourself in trouble. You can create things that just break constantly and you’re spending more time trying to fix them than not. But jobber simplicity with how you can customize it on the back end,
Austin Blanchard: I don’t think that it’s going to, it would ever be something that like a 50 million contractor is going to use. But what we have found is from a customer interface, user experience, jobbers are world-class. They keep things simple, request, quote, job, invoice.
Austin Blanchard: I am not sponsored by Jobber, to be clear. I just personally think that the platform is robust enough and customizable enough that I firmly believe that we could get to $10 million, $12 million without breaking anything. And if a larger contractor was interested in us or something like that, it would probably be a downside to them that we had Jobber if everybody in that space has Service Titan.
Austin Blanchard: We know that. We’re aware of it. But I do think that there is going to be a time where with how much power people who understand how to just be somewhat tech savvy, how much they have in their disposal now, I do think that you’re going to see smaller software companies who can customize their programs and give their clients kind of a white glove experience.
Austin Blanchard: I think that they are going to compete with Service Titan at a pretty competitive level. Because when you’re smaller, that’s just the benefit. You can be more nimble. There’s definitely going to be a blurring of lines.
Tyler Martin: I agree with you because it’s too accessible now. I’ve got within my own client base myself, we’re doing these little applications and stuff to automate and speed up things. Well, think of what a team of engineers can do.
Austin Blanchard: Yeah.
Tyler Martin: Yeah. So at this point with how much is changing, I’m kind of just along for the ride. I’m just interested to kind of see what happens. But we’ve been with Jobber since day one. So there is this reality and we probably have a little bit of emotional loyalty in there that
Tyler Martin: might not be helpful in decision making. But I mean, when you look at it from a cost perspective, which you don’t really want to make software decisions necessarily based on cost, Jobber is going to run you like maybe 25% of what Service Titan is going to run you.
Tyler Martin: and if you can actually take some time to customize your reports and how you want to see things. If you’re under $5 million, in my mind, I think it’s a really easy decision. If you get to the, maybe we’ll talk again in a couple of years at $10 million or something,
Tyler Martin: and I go, oh my gosh, yeah, I was wrong. We needed Titan way back then.
Austin Blanchard: I think the big point is that back end you guys have created, Isaac, and his decided to give up a nice sleep or something or maybe a week of sleep. is really cool. That three-day call board is awesome. Like, I mean, it’s as good as what
Austin Blanchard: Service Titan has as far as their call board, what you can see. I mean, it’s awesome. And then you showed me a couple other things. So that’s really cool. I mean, I think you guys have made it so it does function like a bigger package because of the stuff that you’ve done. Okay, well, cool.
Austin Blanchard: I’m going to wrap this up. I think, man, you just, a lot of wisdom that you shared, very candid, very transparent. Austin, I can’t thank you enough. I feel like there’s a lot of good stuff here and definitely is going to be a part two as you guys scale a little more.
Austin Blanchard: I think there’ll be some new topics we can pick up on.
Tyler Martin: Yeah, man. I mean, I appreciate your time. I think it’s always, you know, I don’t do stuff like this a lot. So it’s fun for me to even just kind of think through like, oh, this is what we’re doing. And I was in the field most of the day.
Tyler Martin: So it’s fun to come back here and just kind of think through, okay, like, cool, we’re actually doing this. And, you know, I would encourage, There’s a ton of opportunity out there in the blue collar area. You know, if you can find somebody in white collar and blue collar, if you can find a partnership, I think that our part is a good partnership is a is the number one competitive advantage we have right now in our industry.
Tyler Martin: We are just very much on the same page. We’re driving toward the same goal. We we care about each other. We want our people to succeed and win. And we don’t have a ton of, we don’t have shareholders to place, you know, it’s just us.
Tyler Martin: And so it’s fun. We have a really, really good time.
Austin Blanchard: So two cool guys in Tennessee, it sounds like is what I’m hearing. Okay, awesome. So I, your, your website, if people want to check it out, you guys got a nice website. It’s Dina call Dina Mac, call Dina Mac.com. Check it out. And then I’ll put your, your LinkedIn.
Tyler Martin: We have a Facebook, Instagram, YouTube, a whole bunch of other sites. I’ll put them in the show notes.
Austin Blanchard: People want to reach out to you and just kind of network or collaborate.
Tyler Martin: Yeah, man, please feel free. If anybody listens to this and wants to reach out to me, we’re, we’re, we’re, we try to be as open as we can. We do want to help. We feel like we have a lot more to learn from other people than we have to give.
Tyler Martin: But if anybody’s in the Chattanooga, Cleveland, Tennessee area, swing by our shop, come say hey. And yeah, love to connect.
Austin Blanchard: Thanks, man. It was great chatting with you.
Tyler Martin: All right, Tyler, you take care.
Austin Blanchard: My conversation with Austin gave me a better appreciation for how intentional the company has to be when it chooses to develop talent instead of buying experience. They’re accepting the extra training time, the mistakes, the callbacks, and the leadership pressure that comes with hiring for character because they believe the long-term result is a stronger team and culture.
Austin Blanchard: But they’re not relying on good intentions alone. They’re building clear roles, documenting the work, tracking individual performance, and using the numbers to understand whether the model is actually working. That is a lesson that I’m taking from this episode. A different growth strategy can work, but only when the systems, accountability, margins,
Austin Blanchard: and cash flow are strong enough to support it. Hey, these are some of the things that we help home service business owners build through at Profit and Grit CFOs. Go check out our webpage, ProfitAndGrit.com. There’s a free cashflow scorecard that you can fill out,
Austin Blanchard: or you’re welcome to book a free intro meeting, which is either on the webpage or you could go straight to CFOIntroCall.com. As always, I so appreciate you listening and watching the episode. I will catch you on the next one.
Related Episodes
- Nobody Talks About This in Home Services – Ashley Stroud
- How a Blind Plumber Built a 40-Truck Business – Bob Beall
- Your HVAC Business Shouldn’t Depend on the Weather – Keith Flores
- Thinking Too Small Is Costing You Millions – Alyssa Rogers
Tyler Martin works with owners on the numbers behind these stories: HVAC business coach.
