There seems to be a lot of “yeah, sure”-ing going on in my circles of entrepreneurs these days.
Like, “did you hear about how well Sally’s company is doing right now during the pandemic?”
“Yeah, sure, she sells expensive wine to rich people;” or,
“Yeah sure, she works with law enforcement customers;” or,
“Yeah, sure, they already had that contract before the economy tanked.”
“Yeah, sure,” isn’t a business plan and it’s not a good look for entrepreneurs either.
When I interviewed Justin Smith of Brite Computers based in Victor, NY, he explained how, after getting whipped around by the post-9/11 economy in 2001, he began putting in place measures to immunize his company from future financial shock. He did this by strengthening the company’s balance sheet and diversifying its customer base between government agencies and private companies. Now, during this new “black swan” event, Brite is surviving just fine.
“I have never forgotten how difficult it was experiencing the burst of the dot com bubble and the tragic events of 9/11 with a fledgling company. As a result, many of the strategic decisions I’ve made since then have been designed to prepare us for the unexpected. These preparations paid off during the financial crisis of 2008 and once again during the most recent COVID-19 crisis.” said Smith.
Just as the tragedy of 9/11 and the subsequent demands for cybersecurity services led to the launch of Justin’s cybersecurity division, there will be many new opportunities to be found in the Post-Covid economy. Nothing stops any entrepreneur from being one of the companies others are saying “yeah, sure” about in the near future.
Here are 3 examples of businesses that have leveraged an entrepreneur’s greatest strength: knowing their customer’s needs. You can follow these templates whether you’re starting a business from scratch or reviving an existing one.
Right Place, Right Time for the Post-Covid Economy
Heritage Building Maintenance is a janitorial services company based in Des Moines, Iowa. Founded by Greg Theroux in 2011, Heritage Building Maintenance employs over 300 professionally trained cleaners to maintain buildings throughout Greater Des Moines. Greg has built a fantastic business but one that’s not easy to operate. With commoditized pricing and a transient workforce, the only way he’ll double his revenues in this business is by also doubling his headaches.
That’s why Greg began transforming his financial model. He wanted to turn his “money making” business into a “moonshot,” one that would be valued by the capital markets as a multiple of revenues reflecting the huge growth potential of his business, not as multiple of earnings which most commoditized businesses tend to be. To do this, he needed to find a market that would pay a premium for what he does and could scale a lot. That led him to discover a microbial cleaning solution. Then, he developed a specialized way to apply this viral disinfectant throughout a commercial space to ensure complete coverage and long-lasting protection.
Greg was already seeing an astounding 100% close rate before Coronavirus hit. Now he can’t keep up with demand. Greg recognized the limitations of his original business and went about changing it. His new business is on track to having its best year yet.
Leveraging the Post-Covid World
One would think that being in the Heating-Ventilation-Air-Conditioning (HVAC) business in Las Vegas would be a no-brainer. The city is built on top of a desert, after all. Looks can be deceiving. With 600 competitors in his market and a very low barrier to entry, Chris Roth’s Climate Control Experts climbed to the top of the heap of Las Vegas’ HVAC world through hard work and savvy marketing. However, his biggest dilemma wasn’t finding new customers (did I mention he’s in air conditioning and it’s a desert?), it was finding the talented technicians that he could hire to help him deliver on the company’s promises.
So Chris began developing a pipeline for new talent by teaching at the local college. This allowed him to spot young folks looking for a place in the industry and starting on the ground floor.
After a few years of teaching, Chris purchased his own struggling trade school. Using his marketing skills, the school has grown in enrollment tenfold. The next leap for Chris’s trade school: going digital. Bringing a hybrid digital-and-hands-on approach to training the next generation of HVAC technicians.
In a post-Covid world, Chris’s trade school has hit the trifecta and is on the path to surpassing the revenue of his HVAC business: he’s teaching a monetizable skill, he’s experiencing increased demand as the workforce looks for new opportunities and he’s teaching digitally so people can learn wherever they’re stuck quarantining.
Chris was pivoting into favorable long term trends but the Coronavirus will only accelerate his bold plans.
The “Uber” of Machine Shops
Machinists are artists in an engineer’s coveralls. That’s why Dave Dussault has always had such a soft spot for his 100+ team members at his company, P1 Industries, a high precision machine shop based in Schenectady, NY. Dussault knows that most machinists aren’t savvy business operators and marketers and aren’t likely to land GE, Ingersoll Rand and the other top tier clients that P1 has. Dussault wanted to create a marketplace where large clients can access the underused capacity of America’s often-idle machine shops. So he launched sP1ndle which, like Uber, pushes all demand through a central portal and allows individual machine shops to bid for the work, backed by P1’s vaunted reputation for quality control in every job.
As American industrial companies begin “re-shoring” their manufacturing (bringing manufacturing back to America), sP1indle can bring 100 times more throughput to P1 without investing in another machine. It’s an innovative approach for an antiquated industry.
These are just a few of the examples of businesses and entrepreneurs that have figured out how to make this economy work for them and are at the beginning of meteoric growth in the post-Covid economy. I’m sure we can find a “yeah, sure” about each of these businesses if we wanted to but why not just create our own “yeah, sure” businesses instead?
People and companies mentioned in this article:
Justin Smith of Brite Computers, Rochester, NY
Greg Theroux of Heritage Building Maintenance, Des Moines, IA
Chris Roth of National Technical Institute, Las Vegas, NV
David Dussault of P1 Industries, Schenectady, NY
(Disclosure: All of these entrepreneurs are past students of mine.)