July 4, 2024 • 37 mins
What does it take to turn a business struggling through a recession into a multi-million-dollar success story? On this episode of Roots of Success, Michael Hupf, CEO of Lifescape Colorado, reveals the blueprint behind growing his landscape company from the brink of collapse to earning $36 million in revenue. Get ready to explore the powerful impact of focusing on people, process, and product, and how a growth mindset can propel your business to new heights. Michael shares invaluable lessons on maintaining client loyalty, implementing effective sales and maintenance strategies, and the essential role of smart, ambitious team members. Tune in to learn how Lifescape pivoted from mere survival to exemplary excellence in the landscaping industry.
THE BIG IDEA:
Growth mindset and strategic planning ensure business resilience.
KEY MOMENTS:
[04:30] Invested in landscape business, sought opportunities in Colorado.
[08:57] Choose business over corporate career, achieve rapid growth.
[14:22] Discussing growth strategies with team
[17:35] Designer turned COO manages all aspects efficiently..
[21:42] Focus on service, drivers, and long-term growth.
[27:43] Healthy business needs profit for sustainability.
[31:27] Enhance client experience through efficiency and preparation.
QUESTIONS WE ANSWER
What are effective strategies for scaling a small business?
What are key metrics to track for business growth?
What are the best practices for managing cash flow during economic downturns?
How to improve client experience in service-based industries?
How to implement a growth mindset in business?
FOR SHOW NOTES & MORE, GO TO:
https://mcfarlinstanford.com/podcast/ep-032-growth-and-resilience-insights-from-lifescape-ceo-michael-hupf/
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
The Roots of Success podcast is
for the landscape professional
who's looking to up their game.
We've got a brain trust of experts to
help you nurture the roots of a successful
business and grow to the next level.
This is The Roots of Success.
Hi there.
Welcome to another episode of
Roots of Success podcast, and
I'm your host, Tommy Cole.
(00:21):
We have an awesome guest today, which
is our good friend and partner in
crime for a lot of reasons Michael
Huff from Denver, Colorado, and he's
the, CEO of Livescape Denver, Colorado.
Welcome, Michael.
How are you?
Great, Tommy.
Thank you for inviting me.
So you have been by far one of
(00:44):
the smartest persons I do know.
Let's talk about your
background just slightly.
you went to school at Creighton
University, got an accounting degree.
So you're the.
You're the numbers guru financial
guru, and then also a business
degree from, from Stanford.
And you spent some time as a senior
associate, but most importantly, you
also had a wine business, which you
probably learned a ton about that.
(01:06):
And then you purchased
Lifescape and Roughly what?
19, 20 years later, here we are.
Right?
That summarizes your whole career?
Basically, except you missed
the whole thing where I grew
up on a farm in Nebraska.
So that was basically, if you want
to know where it all started, it
was basically growing up on a farm,
Yeah,
helping dad with four
(01:26):
brothers, was also into 4 H.
So as the 4 H king and did,
you know, a bunch of gardening
and everything from there.
So I remember I was talking to my
mom and I'm going, I said, I don't
even know where this all started.
And she goes, well, I can tell you.
So just rely on your moms.
She'll remind you.
right?
But yeah, it, it did
(01:48):
start back in Nebraska.
And then like you said,
I went to Creighton.
I was actually a double major.
It wasn't just accounting,
it was biology as well.
So I was pre med.
And so I was looking at what path do I go?
Am I going to go medicine, go to medical
school, or am I going to go into business?
And I chose a business.
So I was with Deloitte for almost
four years as a CPA and then
(02:11):
went to Stanford business school.
And after that, I worked for
McKinsey, which is the world's
best consulting company.
And through that, I worked on a bunch of
public studies, which were kind of nice to
talk about one being Warner Brothers and,
Oh,
You know, it's working on
their whole integration.
One of the worst mergers in history
between AOL and Warner brothers.
(02:33):
But I was helping to clean that mess up.
And that's when, after that I
started had an opportunity and
started a wine company from scratch.
So it was a project we did at
Stanford and it was pretty cool.
Where did,
So how'd you get in the wine business?
Like what happened there?
And then what was that experience about?
it was, it started back at
Stanford business school.
It's like we had a wine club
(02:54):
and we did our own private label
for the class and then sold it.
As a fundraiser for the
university at the business school.
And so what did is that if we can
do that for one university, why
don't we take that nationwide?
And so that's where it started.
So we started doing wine for USC.
We did wine for UCLA university of
(03:16):
Nebraska, Colorado across the country,
and then also started doing IPO wine.
So we did.
Yahoo's IPO wine for celebrations.
We did web band.
So it was really a direct consumer
and direct to business model
and learned a lot about drinking
wine, which is a good thing.
(03:37):
But then also learned about the
basics of business, from, you
know, marketing to finance, to
fulfillment cashflow management
being probably the most important
thing I've learned coming from that.
And trust me, that came in very handy.
Once I got out of that business and,
went back to McKinsey went to the East
coast, started a shared service center
(03:57):
for Condé Nast it was their newspaper
group and was there for five years.
And quite frankly, it was
tired of flying across.
I lived in LA at the time and,
I worked in New York city.
And so I flew every single week, every
single Sunday night and back on Thursday.
And through that process, that's where.
Said I'm going to do something next.
And that's where the whole
(04:18):
landscaping thing started.
So because you had a 4 H background,
you said, man, I want to get my
hands dirty all over again and,
and get started in the landscaping.
Right?
Not necessarily.
I knew you were going to say that.
Not necessarily the hopes.
So, so tell me about the experience
of, of getting involved with Flyscape.
There's a lot of history there, right?
(04:40):
Prior to you.
And then you got involved in
and started kicking that off.
Tell me about that experience.
So I bought 35 percent of landscape in
2006, but in preparation to that, then you
have to get ready for something like that.
So I'm not coming in with, you know,
a ton of landscaping expertise.
It was.
(05:00):
Once I was on the East coast of working in
New York, and I was looking at alternative
things, that's when I said, okay, what
industry do I want to get involved with?
Because I wanted to get back involved with
a small company, basically back to where
things were like with the wine company.
And so I looked at industries, honed
(05:21):
in on the landscape industry, and
then I started looking at markets,
you know, love DC, Chicago, Dallas.
Yeah.
Los Angeles and Denver.
Those were the five markets I looked at
and then honed in on the opportunities
because they were, the other markets
were much further along in the
green industry than what Denver was.
(05:41):
And so there was a quite frankly, a
bigger opportunity in the Colorado market.
So that's where I did.
And then went through the research
and looked at the top five companies
and found out some good synergies
and somebody that was looking at.
Going to the next level.
And so Randy and I had a good
relationship and ended up, joining
(06:03):
him knowing it was going to be a
five year transition from 2006, 2011.
What we didn't plan on is
this little recession in 2000.
And what was that?
09, right?
Oops.
It was, it started.
And I looking backwards on the,
the books, It all started in 2007.
(06:25):
No one knew it that at the time it had,
but I started seeing then interest expense
starting to creep into our P and L.
And so I could see exactly when,
you know, our problems started
happening here in the market.
So what happened after that?
So you trans, you know, what, what year
or two into it, you started seeing this
transition, you know, this whole economic
(06:47):
sort of boss, this 07, 08, 09 transition.
You know, I was in that, that bubble
too, right here in Dallas, Texas.
And, and it was, it was tough.
It was scary.
It was.
All hands on deck to figure things out.
So what was that transition like
going through it and coming out
on top and then how's it going
(07:09):
past, you know, those sort of past
recession, times during a landscape
It was not easy at all.
I mean, when I bought
Lifescape, we were right at 3.
2 million and then we quickly grew it
in 2007 up to five and a half million.
But by 2008, the whole country
was in a firm recession.
(07:31):
So it went right back down to 3.
2 million.
And then no one could see the other
side because it, it didn't get
over until 2000 end of 2010 is when
it really started getting over.
And it took capital.
So it took the, cash management,
going back to the wine company
(07:52):
took the cash management expertise.
We were managing literally
every hundred dollars.
And so it was almost like I was doing
more cash management than I was any
selling, which was unfortunate, but it's
necessary way to keep a business together.
And I had to raise over 2 million
in friends and family capital
(08:13):
raise to keep the company alive.
I never wanted the thing where you
check the box that says, you know,
declared bank rate.
Yeah.
And I said, Nope.
And so that's it.
It literally was raising money,
working with your vendors, getting
together a plan because I knew we
were going to get out the other side.
We just didn't know when.
And so we did.
(08:34):
And so that was 2000 and the end of 2010.
So 2011, we started making money again.
And it, it took a while
to repay that debt.
And so what, what I did strategically.
In 2014 'cause it was a, it
was a painful experience.
Yes.
(08:54):
You're going through the recession.
That itself was from 2007 through
basically 2010, but then we were in
a dead zone period from 2011 to 2014.
And I just knew, you know, it's,
I could do what I wanted to do.
It's like, did I want to go back
to, you know, corporate America?
(09:15):
What did I want to do?
And I made the decision.
Nope.
I'm going to invest more in the business.
And what we did is that we grew, we had,
our specific strategy was just growth.
And so we had for the next, it was six
years, it was just nothing but growth,
(09:36):
you know, that lasted through 2019.
And then of course, we
develop our 10 year plan.
And I'm not kidding you.
The timing was we got signed up
with EOS, that entrepreneurial.
Operating system from the traction,
but we did that in December of 2019.
And that little thing of
(09:56):
cobit then happened in.
Early in the year,
Yeah,
but the good thing is, is that.
Our our 10 year plan was
then to get to 50M dollars.
In revenue, and we are 3
years ahead of schedule.
there you go.
So let's talk about real
quick, tons of growth.
(10:16):
You hit the nail on the head.
I mean, you've, you've seen
anything from starting at 3.
2 million, basically when you
were around and you're, you'll,
you'll get into what you are now.
Talk about the challenges of growing.
You grew so fast.
But talk about the challenges,
but also talk about the wins.
(10:37):
Why did you have so many wins to
grow that, but also talk about
the challenges during that period?
We went, since we went in with a
growth mindset that it was, our pure
strategy was growth just because
we were not a company of scale.
What you'll find is there are these
different levels in the landscape
(10:58):
industry and with inflation, the numbers
have gone up a little bit, but it's
really, it's like you're starting off.
And then, you know, one person
can probably do a half a
million dollars in revenue.
Now, then the next level, and
you're reinventing the company again
is a million dollars and then it
doubles to 2 million and now that
number is probably about 6 million.
(11:19):
And you're gonna find that people
are gonna stagnate right in that
$6 million level for a long time.
And lt, you reinvent yourself again.
And then once you get to that 6
million, now that number is probably
in that 10 to 12 million range and.
Then the next number is
right about 20 million.
And once you, once we hit 20 million, it
(11:41):
was like a completely different company.
So we went from that.
We hit three different levels within it
was five years, which is absolutely crazy.
And Every single time we hit the next
level, it was easier to run the business.
And it was that 20 million level.
That is that really paid off.
that's when people started paying
attention to us nationwide.
(12:02):
Right, right.
So tell me about real quick.
So from that sort of five to 20
million, what were some key metrics
or key things that like really
were successful for your team?
First of all, it's like we were a
hundred percent design build at the time.
So since we were a hundred percent design
build, what we were doing is that we've
always been a very competitive company.
(12:25):
And you know, us, we're
a competitive company.
We're fun.
We joke, but we want to win.
And so what we would do
is that we're tracking.
Basically metrics to know exactly
how we're doing on the selling front.
And so we look, you know, we
look at what have we invoiced?
Then what have we sold in our backlog?
And then we're looking at the
(12:45):
weighted average pipeline and we're
looking at that every single week.
It's not a monthly exercise.
And I work with our sales
people and designers that they
need to look at it every day.
You know, it's not there for a scorecard.
It's how do you manage your professional
life to make sure that you keep winning?
so it was literally focusing on that.
(13:08):
Just intently.
Yeah.
I love that.
You know, at the end of the day, you
want winners in your organization, right?
It's, it's no different
than a sport, right?
Like you want to win, but like, you're
going to have losses along the way, right?
You could take a loss, but like,
what are you going to do when you
do lose in that match or that game?
Right?
No different between the
(13:29):
week or the month, right?
You can have some tough years or
tough months, but like, what are you?
How's your team going to react and
what are you going to do about it?
Right?
We can sit here and go wah,
wah, wah all day long about not
winning, but I love the mentality.
You guys love to have
fun and you love to win.
And those two are like just an
(13:51):
amazing combination at the day.
And you study, what I like about it
is you study the backlog, you study
sales, you study your production, and
you're constantly looking at that every
single day and week, month, and year.
And you keep progressing
along the way, correct?
That's exactly right.
And yeah, that's like, we
went through even this year.
(14:12):
Now we went to push ourselves even further
to be a professional sales organization.
We went through the Sandler training.
Mm hmm.
There's numerous different training
out there for sales, but it's like
Sandler's recognizes one of the best.
And one of the key lessons I
learned from Sandler is that don't
be afraid to get a no upfront.
(14:34):
my gosh, isn't that so true?
Don't be scared to know.
Yep.
Yep.
and so that's, you know, that was
just really, and we have a sales
meeting every single Tuesday and
we have for the past 15 years.
Is that we talk about this
stuff every single week.
Now, in the middle of that growth
(14:55):
from 5 million to 20 million, we then
implemented what was really important.
We started the maintenance division.
Since we were a hundred percent design
build is that when you're looking
at you are only as good as what your
revenue is for that year, when you
wake up on January of the first,
Start all over.
what am I saying?
Waking up when you go to
(15:16):
bed on January, the first.
Totally.
At 1201, your revenue just
went to zero.
Yes.
Yeah.
And so that's, and I will give kudos to
Jim, Jason, you, and Chris from McFarland.
In really helping us launch
(15:36):
the maintenance division.
It was a combination of you and Bill
Arman that really got this off the ground.
So maintenance now.
If you look at our product mix
we, last year, we ended the year
as a 36Million dollar company.
And 39 percent of our revenue is
from, we're from recurring revenue.
(15:57):
Zero to 39 percent of your
business is maintenance.
And over those years, And you saw
the value of maintenance, right?
You put in some key pieces in your
organization between personnel,
teams, field teams, you put in a,
an account management system, right?
That says we're going to be at
your property every single week.
We're going to take care of the high
touches, the high properties, all the
(16:19):
details that go in, because what happens,
it's just reoccurring revenue every
single month, and not only that you get
enhancements, enhancements, enhancements.
So, so almost half your business.
reoccurring.
Yeah, we're my goal.
So this year will be in the low 40%.
So we'll go for 40%.
(16:39):
And within 5 years.
I would love it to be 60 percent
maintenance and 40 percent construction.
Love it.
Makes it makes the New
Year's Eve a lot better.
Yeah, you make it stay
out past 1201, right?
Exactly.
stuff.
Michael, talk about, talk about
the people in your organization.
You've got some good ones.
(17:00):
Explain what it means.
We talk about people all the time
that they're probably your best and
most important asset in your business.
It's not the skid steer or the lawn mower.
It's the people in order
to do those activities.
Talk about that means to you in Lifescape.
To me, I mean, you, you need to, first
of all, set out what your goals are.
(17:22):
Like, what do you want to be?
it's best not to create
a company around people.
You basically have the structure, you
know, what your strategy is going to be.
And then you bring in great people
and you don't know what role
they're necessarily going to fill.
I mean, right now is the end,
you know, or quite well, she was
(17:44):
any LPs woman of the year 2023.
And she started as a designer with us.
She was the first person that I hired.
July of, 2006, and she's now
our chief operating officer.
So she now is running both the
design side design build side,
(18:07):
and also the maintenance side.
So she runs everything in the field and
the great, you know, partner with us.
So Then you take from the rest of
the operations folks, it's like
that have been underneath of her.
We've had designers that
have been with us for.
Going on 18 years.
So the key thing is that finding good
(18:28):
people, and they need to be smart.
Yeah.
want to win, want to have a good time.
That's the recipe for success.
That's great.
That's great.
You know, I love the part where
you say build a structure, right?
I got to build a structure.
I got to build a system that
produces, you know, Great landscape
and maintains the landscape.
And Oh, by the way, I'm going to find some
(18:49):
really good people and you're probably
going to hire some bad people, right?
That's, that's no big deal.
That's part of life.
We've all hired the bad ones.
We've all had to move on from the bad
ones, but the good ones stick around
for a very long time and they adapt to
your system and they can move within
an organization as Leanne has done It's
(19:10):
not been the perfect road, but it has
been one heck of a good ride so far.
And you then look at on our
production side, you have folks in
our organization that like Cody, he
started out as an assistant foreman.
So he's number two on a crew.
He then became foreman,
become senior foreman, and
(19:31):
now he's a production manager.
Wow.
know he's already looking at, he said,
okay, how do I become a branch manager?
Yeah.
how you want to be able to grow
your talent in the company.
Yeah.
Nothing's better than promoting within.
That's
an absolute game changer
for your organization.
I love it.
talk about maintaining landscapes
(19:51):
in the high end industry, right?
Sometimes people think it's a little
scary dealing with high end clientele
and budgets and that sort of thing, but
what's attractive about that pot spot?
I feel like during the recession, you're
probably want a decent spot because The
wealthy people love to spend money, right?
(20:12):
Rightfully so, dinner, recession.
But like, tell me how you guys
have been successful maintaining
high end residential clients.
I think it starts with
not calling them high end.
It's, it's that I really
believe that it's high touch.
So.
If you think of high end, I
mean, that is, yes, they do.
(20:33):
It's the luxury market.
They have money.
That's what defines that market.
But by focusing on high touch
instead of the high end, that service
is what people are looking for.
And so that I think is the key is you
focus on service, keep your prices
reasonable, you'll win day in and day out.
(20:55):
At the end of the day, you know,
you sell a service to the client.
That's it, right?
And can you perform that service
On time and on budget and then they
have a smile at the end of the job.
That's it the end of the day, right?
It's not complicated.
got to produce.
We just got when we say we're going
to do something to show up and do it
(21:15):
Yeah.
Our number one complaint.
Is communication that,
music
and it's, it is the entire.
reason that you're going to get fired
Yeah,
lack of communication, right?
Hundred
is exactly right.
And so when I think about service
is that we are far from perfect.
Everybody, you know, it's like,
(21:35):
and what you've got to do is
you've got to learn from things.
Well, it's like this morning we had two
complaints from clients about driving.
And so my thing is, is that we
need to take those complaints.
Just as seriously in follow up than if
we got a lead for a 15, 20 million home.
(21:56):
percent
And so if you focus on that service
aspect of things, that's, that's
what we'll, you know, do we have a
problem with our drivers evidently?
Because we had two complaints, you
know, so, you know, but those are the
things that we really want to focus
on for, you know, us in the longterm.
Now we've been, you know, this is now see
our, we're going, we are in our 49th year.
(22:18):
In business, the oldest, you
know, high touch landscape
company in the Colorado market.
And so, yes, we'll be
going in our 50th year
50 years next year.
I'm there in Denver to celebrate.
I will be there, to celebrate 50.
So you just tell me the
date and we'll be there.
Perfect.
So let's talk about something unique that
(22:40):
has happened to Lifescape early this year.
I don't, you, you, you tell us,
Yeah.
happened earlier this year to Lifescape?
Now you're making me nervous.
Yeah.
It was a big deal.
we decided to partner with Mariani.
And.
I am on day 115 of this, and I
(23:01):
will tell you 115 of 115 days.
It was absolutely the right decision.
It's the right decision for number
one, our team gives them opportunity
of doing, you know, it's like even
taking life scape to the next level,
taking their careers to the next level.
(23:21):
And it's the right thing for our clients.
And it was, it was a, a great strategy
for me, you know, as owner of Lifescape
to take chips off the table as well.
So, yeah, so it was Frank is a
dear friend of mine, Frank Mariani.
I met him 20 years ago when
I was looking at the market.
And when I was back in New York
city met a lot of great folks in
(23:43):
the industry and he was one of them.
And it was, we, we, as Mariani.
Are creating the best outdoor
living company in the world.
That's our vision statement
and it is what we're doing.
Yes, we're growing rapidly.
And for us, it's been a great experience.
And I had our town halls.
(24:04):
We always have two town halls a year,
of our folks and everybody has said
that it is, they have zero complaints.
That's great.
That's great.
That's awesome.
Well, first off, congratulations.
That's been a huge deal and I'm excited
and happy for the entire Lifescape team.
I've definitely spent some time up
(24:24):
there in Denver with you and your
team and, and we've definitely
spent some time together outside
of Denver, Colorado over the years.
And when I, when I heard the news, I
was extremely ecstatic for you guys.
There's one thing that's probably on
everyone's mind that's listening to
this right now and they go, Oh my gosh.
They partner up Mariani,
(24:44):
like I'm a 5 million company.
Now, listen to this, how do I get my
business to where it needs to be at
that level to be partners with somebody
now, whether it be now or I need to
get to that spot, but talk about some
things that you had to get the business
(25:05):
to, to be getting ready to that.
I would start with a great TV
show, is on CNBC is the profit.
I don't know if you've ever seen that
before, Tommy.
Yes.
And it's like, according
to him, it is so simple.
Break your business down.
It's the three P's.
It's number one.
It's people.
(25:26):
Two is process and three is the product.
If you do those three,
that results in profit.
And he did add a fourth P and
that fourth P was passion.
And I really believe in that simplicity.
And that's, I did not
plan on this happening.
It just came to be, I knew it
was going to eventually, but the
(25:47):
timing of it, it was so I did not
get the company ready to do this.
It just happened.
But it was because over the years we
had focused on those piece, you know,
it really was those five P's with
the fifth one being profit because
you have to have the right people.
You have to have those processes in place.
(26:09):
You need to make sure that you have
the, you're creating the right product.
And then if you're, if your team has that
passion in the product, that those are
the people, And companies that companies
are attracted and partnering with.
And I look at it as a partnership.
It is not just an acquisition.
It's a partnership and, it's great, but
(26:31):
yeah, that's, those are the things I
would focus on the basics of business.
Don't try to get cute and doctor
your books because trust me,
anybody would find that out.
So it's just getting your,
getting the basics done.
Totally.
You hit a, you hit a, a sensitive
subject, I think for a lot of
business owners and that is.
We talk about that a lot, but
(26:52):
that's that word called profit.
And let's just be real
honest with everyone.
If you're not making
money, that's an issue.
Um, with all the government money
that's over the past years, or you're
not watching your hours, or you're not
making money, or you don't know what
your billable rate is, or you don't
know, those types of things are hurting.
(27:13):
And I feel like our industry
suffers because we almost work
for free for sometimes, right?
And you've heard that across.
The entire country.
Well, the profits just not there.
The profits not there.
Well, at the end of the day, we
are for profit businesses, right?
We work way too hard in this industry.
Landscape business owners are some of the
(27:35):
best people out there in any industry.
I, and I'm willing to bet on that, but
you got to make money in this business.
And you guys have done it, for
the most part, pretty well.
Like, don't be ashamed of making
money at the end of the day.
Can you explain some of that?
Well, you, I mean, it needs to
(27:56):
start with that is that a healthy
business is a profitable business.
If you don't make money, you won't
have the resources to take care of
the two most important things, which
are your team and your clients,
because you will cut corners on both.
So you need to be profitable.
Now that profit comes in different stages.
When we were going through, I
(28:18):
mean, you have the externality of
the recession, that's different.
But then when we were in that period of
growth from 2015 to 2020, during that
period of growth, I mean, you're a five
year period and we were only making
between one and maybe two and a half
percent net income, which is not enough
(28:38):
to sustain where you need to be going.
But whenever you're growing
that fast, things happen.
And so we had a strategy of growth.
It wasn't the strategy of, you're
getting the most on the bottom line.
Now, once we got to scale, once we got,
you know, the processes that really
wanted people, and then we shifted,
(28:59):
our strategy is no longer growth.
Our strategy was excellence.
Once we did that, our profits tripled.
And so then, you know, the, the key is
getting your business to no less than
eight, but I would prefer that people
are striving for a 10 percent net income.
(29:20):
Year in and year out that way.
Some years, if you don't do as good as
you should have, you'll be at eight and
then your good years, you're at 12, 13.
So the key thing is focusing on that
double digit net income and you can do it.
And it's, it is not rocket science
Yeah, totally agree with you.
Talk about, sales, Like you're, you're
really involved in that, side of
(29:41):
the business of Lifescape and sales.
So I feel like this is the year
we're in 2024 where you're probably
experiencing this a little bit in your
business, but sales are not as easy.
As it has been right when, when
COVID was rampant and people were
sitting at home going, do whatever
it takes, I'll spend whatever.
(30:02):
Right.
And so the first.
This, this year has been
a little bit tricky.
And I think everyone can see it, but
what is Lifescape or what are you guys
learning in, in your markets of what you
should be doing and what's successful
right now, it's not easy, but like,
how are you overcoming that right now?
is you hit the nail on the head.
I'm, I'm part of our peer group, you
(30:23):
know, it's like we, and everybody, we
had 12 companies there, Tommy and 11
out of the 12, All had a softness in
the design build backlog and pipeline.
it's across the country.
And so you have to be better at sales.
And so what does that mean?
You've got an hours was, is
(30:43):
that we actually rethought
the whole lead intake process.
How do we provide a better experience
from that first moment that we have
contact with a potential client?
So we rethought that.
How can we have Give them more attention.
Then we went through the next one.
(31:04):
How can we shorten the production
process from creating a design and
getting that construction contract so
that people are out there because now
that they're, you know, everybody's
backlogs are a little leaner.
People can get a project done faster.
And that it's like the last part is that
working through the production making
sure that you are then transitioning that.
(31:27):
Over to the property care team.
So we get that full service of design
build, and then we maintain it.
I love it.
So it's all about the
client experience, right?
And can we take the experience?
And have the most greatest
experience for that client.
One, two, can we shorten it?
(31:48):
Right?
Can we get faster?
Can we get a quote out quicker?
Well, we got to have templates.
Well, in the intake form, we
got to ask more questions.
And out of those questions and
all that data, how do I get
it to the design sales team?
So they got more information before
they go to the on site visit.
Production wise, how do we do pre
planning and get ready for these
jobs and order materials in advance?
(32:08):
Construction schedules,
invoicing, all that.
And you kind of condense them
a little bit more and more.
At the end of the day, you got yourself,
set yourself apart from your competition.
And so it's show up on time,
look professional, speed kills.
Right?
Super.
Go fast.
(32:28):
Say what you're going to do.
Communicate along the way and
few things will set you apart.
But if you do it the exact same way
that you did it last year, you will fail
Totally.
can pretty much guarantee you
Yes.
it's a different market out there.
And I think it'll be this
way for the next 18 months.
Good stuff, Michael.
So, future plans for Lifescape.
(32:49):
What?
You've accomplished a lot in 20 years.
And you know, going from 3 to 36.
Partnership with Mariani.
But what's the future hold
with you and the team?
Is it, we're just going to continue
doing what we have been doing.
Which we are known as not just
local leaders were national leaders.
(33:10):
And now that we've joined forces with
Mariani, that's what we'll just do.
And so we're going to keep
pushing the industry forward.
And quite frankly, faster than
we could have by ourselves.
And so I'm looking forward to the future
and you know, the, you know, I look at
the background that you have, there is
a, the green industry is not going away.
(33:33):
And so we.
You know, it's like you could have as
much AI and everything you want, but
the green industry isn't going away
with the way that we are improving.
Both are the lives of our clients,
both residential and commercial.
So because that we really want to
be leaders in the forefront and give
our team the best opportunities of
(33:53):
leadership throughout the world.
Love it.
That's great.
So as we wrap up, Michael, any last
minute advice for anyone that's listening
out there that you've experienced
in your 20 years of landscaping,
years of 4 H farm, many years in the
wine industry, what's one takeaway
(34:13):
you can leave with our audience?
The most important thing
is be a good person.
Yes,
And it's like, I've had guard
managers say, what's the most
important quality you're looking at
when you're hiring a guard manager.
And so I can answer that question.
I don't care if I'm hiring a
guard manager, I'm hiring a
controller, I'm hiring a designer.
It really is be a good person, be
(34:36):
smart, make sure that you're prepared
for everything that you're doing.
And it's like, at the end of the day,
you'll get exactly what you put into it.
gets you far in life, right at the
end of the day, just be a good person.
the high road and go with it.
So Michael, I've got a few takeaways.
We call these the Tommy takeaways.
(34:57):
This is good information.
But I love the fact that,
watching sales backlog constantly.
What's coming down the pipe?
How much are we bidding?
What does the production look like?
Constantly reviewing that every single
day, week, and month managing growth.
You got to set goals.
(35:17):
Where are you going?
Where's this ship that you're
steering headed towards?
Is it just like in the middle of the ocean
kind of going in circles because there's
no goals and there's no people know?
I love the fact that you have a
winning culture because you need
to know if you're winning or not.
It's no different in football and
basketball and sports in life.
(35:39):
Like, are we winning or not?
Are we just coming in every day,
clocking in, do our job and we clock
out for no rhyme or reason and we go
home and there's no purpose in life.
In our industry or in life find good
people, put them into structure.
That's built the livescape
structure, the process, right?
(36:00):
I love the word high touch because your
industry considers a lot of touches.
Therefore relies a lot on communication.
You said the number one reason
why you get fired is what?
Communication.
Love it.
A huge partnership with Mariani
has probably taught you a ton, but
action today to get your business
ready to have a great partnership.
(36:21):
It's the people, it's the
process, it's the profit, it's
the product and it's the passion.
I love those.
Michael, it's been a pleasure.
You're such a good friend of ours.
We've had tons of visits to Denver
and tons of memories and throughout
a ton of cities in the United States.
It's always been a pleasure having you on.
(36:42):
Thank you for coming on here.
Absolutely.
Thank you, Tommy, so much for everything
that you and McFarland do for us as well.
Absolutely.
We'll see you soon, buddy.
Thank you.
Thank you, Tommy.
Ready to take the next step?
Download our free Profitability Scorecard
to quickly create your own baseline
financial assessment and uncover the
fastest ways to improve your business.
(37:03):
Just go to McFarlinStanford.com/scorecard
to get yours today To learn more about
McFarlin Stanford our best in class
peer groups and other services go to
our website at McFarlinStanford.com
And don't forget to follow us on
LinkedIn, Facebook, and Instagram.
See you next time on the Roots of Success.
The Roots of Success podcast is
for the landscape professional
who's looking to up their game.
We've got a brain trust of experts to
help you nurture the roots of a successful
business and grow to the next level.
This is The Roots of Success.
Hi there.
Welcome to another episode of
Roots of Success podcast, and
I'm your host, Tommy Cole.
(00:21):
We have an awesome guest today, which
is our good friend and partner in
crime for a lot of reasons Michael
Huff from Denver, Colorado, and he's
the, CEO of Livescape Denver, Colorado.
Welcome, Michael.
How are you?
Great, Tommy.
Thank you for inviting me.
So you have been by far one of
(00:44):
the smartest persons I do know.
Let's talk about your
background just slightly.
you went to school at Creighton
University, got an accounting degree.
So you're the.
You're the numbers guru financial
guru, and then also a business
degree from, from Stanford.
And you spent some time as a senior
associate, but most importantly, you
also had a wine business, which you
probably learned a ton about that.
(01:06):
And then you purchased
Lifescape and Roughly what?
19, 20 years later, here we are.
Right?
That summarizes your whole career?
Basically, except you missed
the whole thing where I grew
up on a farm in Nebraska.
So that was basically, if you want
to know where it all started, it
was basically growing up on a farm,
Yeah,
helping dad with four
(01:26):
brothers, was also into 4 H.
So as the 4 H king and did,
you know, a bunch of gardening
and everything from there.
So I remember I was talking to my
mom and I'm going, I said, I don't
even know where this all started.
And she goes, well, I can tell you.
So just rely on your moms.
She'll remind you.
right?
But yeah, it, it did
(01:48):
start back in Nebraska.
And then like you said,
I went to Creighton.
I was actually a double major.
It wasn't just accounting,
it was biology as well.
So I was pre med.
And so I was looking at what path do I go?
Am I going to go medicine, go to medical
school, or am I going to go into business?
And I chose a business.
So I was with Deloitte for almost
four years as a CPA and then
(02:11):
went to Stanford business school.
And after that, I worked for
McKinsey, which is the world's
best consulting company.
And through that, I worked on a bunch of
public studies, which were kind of nice to
talk about one being Warner Brothers and,
Oh,
You know, it's working on
their whole integration.
One of the worst mergers in history
between AOL and Warner brothers.
(02:33):
But I was helping to clean that mess up.
And that's when, after that I
started had an opportunity and
started a wine company from scratch.
So it was a project we did at
Stanford and it was pretty cool.
Where did,
So how'd you get in the wine business?
Like what happened there?
And then what was that experience about?
it was, it started back at
Stanford business school.
It's like we had a wine club
(02:54):
and we did our own private label
for the class and then sold it.
As a fundraiser for the
university at the business school.
And so what did is that if we can
do that for one university, why
don't we take that nationwide?
And so that's where it started.
So we started doing wine for USC.
We did wine for UCLA university of
(03:16):
Nebraska, Colorado across the country,
and then also started doing IPO wine.
So we did.
Yahoo's IPO wine for celebrations.
We did web band.
So it was really a direct consumer
and direct to business model
and learned a lot about drinking
wine, which is a good thing.
(03:37):
But then also learned about the
basics of business, from, you
know, marketing to finance, to
fulfillment cashflow management
being probably the most important
thing I've learned coming from that.
And trust me, that came in very handy.
Once I got out of that business and,
went back to McKinsey went to the East
coast, started a shared service center
(03:57):
for Condé Nast it was their newspaper
group and was there for five years.
And quite frankly, it was
tired of flying across.
I lived in LA at the time and,
I worked in New York city.
And so I flew every single week, every
single Sunday night and back on Thursday.
And through that process, that's where.
Said I'm going to do something next.
And that's where the whole
(04:18):
landscaping thing started.
So because you had a 4 H background,
you said, man, I want to get my
hands dirty all over again and,
and get started in the landscaping.
Right?
Not necessarily.
I knew you were going to say that.
Not necessarily the hopes.
So, so tell me about the experience
of, of getting involved with Flyscape.
There's a lot of history there, right?
(04:40):
Prior to you.
And then you got involved in
and started kicking that off.
Tell me about that experience.
So I bought 35 percent of landscape in
2006, but in preparation to that, then you
have to get ready for something like that.
So I'm not coming in with, you know,
a ton of landscaping expertise.
It was.
(05:00):
Once I was on the East coast of working in
New York, and I was looking at alternative
things, that's when I said, okay, what
industry do I want to get involved with?
Because I wanted to get back involved with
a small company, basically back to where
things were like with the wine company.
And so I looked at industries, honed
(05:21):
in on the landscape industry, and
then I started looking at markets,
you know, love DC, Chicago, Dallas.
Yeah.
Los Angeles and Denver.
Those were the five markets I looked at
and then honed in on the opportunities
because they were, the other markets
were much further along in the
green industry than what Denver was.
(05:41):
And so there was a quite frankly, a
bigger opportunity in the Colorado market.
So that's where I did.
And then went through the research
and looked at the top five companies
and found out some good synergies
and somebody that was looking at.
Going to the next level.
And so Randy and I had a good
relationship and ended up, joining
(06:03):
him knowing it was going to be a
five year transition from 2006, 2011.
What we didn't plan on is
this little recession in 2000.
And what was that?
09, right?
Oops.
It was, it started.
And I looking backwards on the,
the books, It all started in 2007.
(06:25):
No one knew it that at the time it had,
but I started seeing then interest expense
starting to creep into our P and L.
And so I could see exactly when,
you know, our problems started
happening here in the market.
So what happened after that?
So you trans, you know, what, what year
or two into it, you started seeing this
transition, you know, this whole economic
(06:47):
sort of boss, this 07, 08, 09 transition.
You know, I was in that, that bubble
too, right here in Dallas, Texas.
And, and it was, it was tough.
It was scary.
It was.
All hands on deck to figure things out.
So what was that transition like
going through it and coming out
on top and then how's it going
(07:09):
past, you know, those sort of past
recession, times during a landscape
It was not easy at all.
I mean, when I bought
Lifescape, we were right at 3.
2 million and then we quickly grew it
in 2007 up to five and a half million.
But by 2008, the whole country
was in a firm recession.
(07:31):
So it went right back down to 3.
2 million.
And then no one could see the other
side because it, it didn't get
over until 2000 end of 2010 is when
it really started getting over.
And it took capital.
So it took the, cash management,
going back to the wine company
(07:52):
took the cash management expertise.
We were managing literally
every hundred dollars.
And so it was almost like I was doing
more cash management than I was any
selling, which was unfortunate, but it's
necessary way to keep a business together.
And I had to raise over 2 million
in friends and family capital
(08:13):
raise to keep the company alive.
I never wanted the thing where you
check the box that says, you know,
declared bank rate.
Yeah.
And I said, Nope.
And so that's it.
It literally was raising money,
working with your vendors, getting
together a plan because I knew we
were going to get out the other side.
We just didn't know when.
And so we did.
(08:34):
And so that was 2000 and the end of 2010.
So 2011, we started making money again.
And it, it took a while
to repay that debt.
And so what, what I did strategically.
In 2014 'cause it was a, it
was a painful experience.
Yes.
(08:54):
You're going through the recession.
That itself was from 2007 through
basically 2010, but then we were in
a dead zone period from 2011 to 2014.
And I just knew, you know, it's,
I could do what I wanted to do.
It's like, did I want to go back
to, you know, corporate America?
(09:15):
What did I want to do?
And I made the decision.
Nope.
I'm going to invest more in the business.
And what we did is that we grew, we had,
our specific strategy was just growth.
And so we had for the next, it was six
years, it was just nothing but growth,
(09:36):
you know, that lasted through 2019.
And then of course, we
develop our 10 year plan.
And I'm not kidding you.
The timing was we got signed up
with EOS, that entrepreneurial.
Operating system from the traction,
but we did that in December of 2019.
And that little thing of
(09:56):
cobit then happened in.
Early in the year,
Yeah,
but the good thing is, is that.
Our our 10 year plan was
then to get to 50M dollars.
In revenue, and we are 3
years ahead of schedule.
there you go.
So let's talk about real
quick, tons of growth.
(10:16):
You hit the nail on the head.
I mean, you've, you've seen
anything from starting at 3.
2 million, basically when you
were around and you're, you'll,
you'll get into what you are now.
Talk about the challenges of growing.
You grew so fast.
But talk about the challenges,
but also talk about the wins.
(10:37):
Why did you have so many wins to
grow that, but also talk about
the challenges during that period?
We went, since we went in with a
growth mindset that it was, our pure
strategy was growth just because
we were not a company of scale.
What you'll find is there are these
different levels in the landscape
(10:58):
industry and with inflation, the numbers
have gone up a little bit, but it's
really, it's like you're starting off.
And then, you know, one person
can probably do a half a
million dollars in revenue.
Now, then the next level, and
you're reinventing the company again
is a million dollars and then it
doubles to 2 million and now that
number is probably about 6 million.
(11:19):
And you're gonna find that people
are gonna stagnate right in that
$6 million level for a long time.
And lt, you reinvent yourself again.
And then once you get to that 6
million, now that number is probably
in that 10 to 12 million range and.
Then the next number is
right about 20 million.
And once you, once we hit 20 million, it
(11:41):
was like a completely different company.
So we went from that.
We hit three different levels within it
was five years, which is absolutely crazy.
And Every single time we hit the next
level, it was easier to run the business.
And it was that 20 million level.
That is that really paid off.
that's when people started paying
attention to us nationwide.
(12:02):
Right, right.
So tell me about real quick.
So from that sort of five to 20
million, what were some key metrics
or key things that like really
were successful for your team?
First of all, it's like we were a
hundred percent design build at the time.
So since we were a hundred percent design
build, what we were doing is that we've
always been a very competitive company.
(12:25):
And you know, us, we're
a competitive company.
We're fun.
We joke, but we want to win.
And so what we would do
is that we're tracking.
Basically metrics to know exactly
how we're doing on the selling front.
And so we look, you know, we
look at what have we invoiced?
Then what have we sold in our backlog?
And then we're looking at the
(12:45):
weighted average pipeline and we're
looking at that every single week.
It's not a monthly exercise.
And I work with our sales
people and designers that they
need to look at it every day.
You know, it's not there for a scorecard.
It's how do you manage your professional
life to make sure that you keep winning?
so it was literally focusing on that.
(13:08):
Just intently.
Yeah.
I love that.
You know, at the end of the day, you
want winners in your organization, right?
It's, it's no different
than a sport, right?
Like you want to win, but like, you're
going to have losses along the way, right?
You could take a loss, but like,
what are you going to do when you
do lose in that match or that game?
Right?
No different between the
(13:29):
week or the month, right?
You can have some tough years or
tough months, but like, what are you?
How's your team going to react and
what are you going to do about it?
Right?
We can sit here and go wah,
wah, wah all day long about not
winning, but I love the mentality.
You guys love to have
fun and you love to win.
And those two are like just an
(13:51):
amazing combination at the day.
And you study, what I like about it
is you study the backlog, you study
sales, you study your production, and
you're constantly looking at that every
single day and week, month, and year.
And you keep progressing
along the way, correct?
That's exactly right.
And yeah, that's like, we
went through even this year.
(14:12):
Now we went to push ourselves even further
to be a professional sales organization.
We went through the Sandler training.
Mm hmm.
There's numerous different training
out there for sales, but it's like
Sandler's recognizes one of the best.
And one of the key lessons I
learned from Sandler is that don't
be afraid to get a no upfront.
(14:34):
my gosh, isn't that so true?
Don't be scared to know.
Yep.
Yep.
and so that's, you know, that was
just really, and we have a sales
meeting every single Tuesday and
we have for the past 15 years.
Is that we talk about this
stuff every single week.
Now, in the middle of that growth
(14:55):
from 5 million to 20 million, we then
implemented what was really important.
We started the maintenance division.
Since we were a hundred percent design
build is that when you're looking
at you are only as good as what your
revenue is for that year, when you
wake up on January of the first,
Start all over.
what am I saying?
Waking up when you go to
(15:16):
bed on January, the first.
Totally.
At 1201, your revenue just
went to zero.
Yes.
Yeah.
And so that's, and I will give kudos to
Jim, Jason, you, and Chris from McFarland.
In really helping us launch
(15:36):
the maintenance division.
It was a combination of you and Bill
Arman that really got this off the ground.
So maintenance now.
If you look at our product mix
we, last year, we ended the year
as a 36Million dollar company.
And 39 percent of our revenue is
from, we're from recurring revenue.
(15:57):
Zero to 39 percent of your
business is maintenance.
And over those years, And you saw
the value of maintenance, right?
You put in some key pieces in your
organization between personnel,
teams, field teams, you put in a,
an account management system, right?
That says we're going to be at
your property every single week.
We're going to take care of the high
touches, the high properties, all the
(16:19):
details that go in, because what happens,
it's just reoccurring revenue every
single month, and not only that you get
enhancements, enhancements, enhancements.
So, so almost half your business.
reoccurring.
Yeah, we're my goal.
So this year will be in the low 40%.
So we'll go for 40%.
(16:39):
And within 5 years.
I would love it to be 60 percent
maintenance and 40 percent construction.
Love it.
Makes it makes the New
Year's Eve a lot better.
Yeah, you make it stay
out past 1201, right?
Exactly.
stuff.
Michael, talk about, talk about
the people in your organization.
You've got some good ones.
(17:00):
Explain what it means.
We talk about people all the time
that they're probably your best and
most important asset in your business.
It's not the skid steer or the lawn mower.
It's the people in order
to do those activities.
Talk about that means to you in Lifescape.
To me, I mean, you, you need to, first
of all, set out what your goals are.
(17:22):
Like, what do you want to be?
it's best not to create
a company around people.
You basically have the structure, you
know, what your strategy is going to be.
And then you bring in great people
and you don't know what role
they're necessarily going to fill.
I mean, right now is the end,
you know, or quite well, she was
(17:44):
any LPs woman of the year 2023.
And she started as a designer with us.
She was the first person that I hired.
July of, 2006, and she's now
our chief operating officer.
So she now is running both the
design side design build side,
(18:07):
and also the maintenance side.
So she runs everything in the field and
the great, you know, partner with us.
So Then you take from the rest of
the operations folks, it's like
that have been underneath of her.
We've had designers that
have been with us for.
Going on 18 years.
So the key thing is that finding good
(18:28):
people, and they need to be smart.
Yeah.
want to win, want to have a good time.
That's the recipe for success.
That's great.
That's great.
You know, I love the part where
you say build a structure, right?
I got to build a structure.
I got to build a system that
produces, you know, Great landscape
and maintains the landscape.
And Oh, by the way, I'm going to find some
(18:49):
really good people and you're probably
going to hire some bad people, right?
That's, that's no big deal.
That's part of life.
We've all hired the bad ones.
We've all had to move on from the bad
ones, but the good ones stick around
for a very long time and they adapt to
your system and they can move within
an organization as Leanne has done It's
(19:10):
not been the perfect road, but it has
been one heck of a good ride so far.
And you then look at on our
production side, you have folks in
our organization that like Cody, he
started out as an assistant foreman.
So he's number two on a crew.
He then became foreman,
become senior foreman, and
(19:31):
now he's a production manager.
Wow.
know he's already looking at, he said,
okay, how do I become a branch manager?
Yeah.
how you want to be able to grow
your talent in the company.
Yeah.
Nothing's better than promoting within.
That's
an absolute game changer
for your organization.
I love it.
talk about maintaining landscapes
(19:51):
in the high end industry, right?
Sometimes people think it's a little
scary dealing with high end clientele
and budgets and that sort of thing, but
what's attractive about that pot spot?
I feel like during the recession, you're
probably want a decent spot because The
wealthy people love to spend money, right?
(20:12):
Rightfully so, dinner, recession.
But like, tell me how you guys
have been successful maintaining
high end residential clients.
I think it starts with
not calling them high end.
It's, it's that I really
believe that it's high touch.
So.
If you think of high end, I
mean, that is, yes, they do.
(20:33):
It's the luxury market.
They have money.
That's what defines that market.
But by focusing on high touch
instead of the high end, that service
is what people are looking for.
And so that I think is the key is you
focus on service, keep your prices
reasonable, you'll win day in and day out.
(20:55):
At the end of the day, you know,
you sell a service to the client.
That's it, right?
And can you perform that service
On time and on budget and then they
have a smile at the end of the job.
That's it the end of the day, right?
It's not complicated.
got to produce.
We just got when we say we're going
to do something to show up and do it
(21:15):
Yeah.
Our number one complaint.
Is communication that,
music
and it's, it is the entire.
reason that you're going to get fired
Yeah,
lack of communication, right?
Hundred
is exactly right.
And so when I think about service
is that we are far from perfect.
Everybody, you know, it's like,
(21:35):
and what you've got to do is
you've got to learn from things.
Well, it's like this morning we had two
complaints from clients about driving.
And so my thing is, is that we
need to take those complaints.
Just as seriously in follow up than if
we got a lead for a 15, 20 million home.
(21:56):
percent
And so if you focus on that service
aspect of things, that's, that's
what we'll, you know, do we have a
problem with our drivers evidently?
Because we had two complaints, you
know, so, you know, but those are the
things that we really want to focus
on for, you know, us in the longterm.
Now we've been, you know, this is now see
our, we're going, we are in our 49th year.
(22:18):
In business, the oldest, you
know, high touch landscape
company in the Colorado market.
And so, yes, we'll be
going in our 50th year
50 years next year.
I'm there in Denver to celebrate.
I will be there, to celebrate 50.
So you just tell me the
date and we'll be there.
Perfect.
So let's talk about something unique that
(22:40):
has happened to Lifescape early this year.
I don't, you, you, you tell us,
Yeah.
happened earlier this year to Lifescape?
Now you're making me nervous.
Yeah.
It was a big deal.
we decided to partner with Mariani.
And.
I am on day 115 of this, and I
(23:01):
will tell you 115 of 115 days.
It was absolutely the right decision.
It's the right decision for number
one, our team gives them opportunity
of doing, you know, it's like even
taking life scape to the next level,
taking their careers to the next level.
(23:21):
And it's the right thing for our clients.
And it was, it was a, a great strategy
for me, you know, as owner of Lifescape
to take chips off the table as well.
So, yeah, so it was Frank is a
dear friend of mine, Frank Mariani.
I met him 20 years ago when
I was looking at the market.
And when I was back in New York
city met a lot of great folks in
(23:43):
the industry and he was one of them.
And it was, we, we, as Mariani.
Are creating the best outdoor
living company in the world.
That's our vision statement
and it is what we're doing.
Yes, we're growing rapidly.
And for us, it's been a great experience.
And I had our town halls.
(24:04):
We always have two town halls a year,
of our folks and everybody has said
that it is, they have zero complaints.
That's great.
That's great.
That's awesome.
Well, first off, congratulations.
That's been a huge deal and I'm excited
and happy for the entire Lifescape team.
I've definitely spent some time up
(24:24):
there in Denver with you and your
team and, and we've definitely
spent some time together outside
of Denver, Colorado over the years.
And when I, when I heard the news, I
was extremely ecstatic for you guys.
There's one thing that's probably on
everyone's mind that's listening to
this right now and they go, Oh my gosh.
They partner up Mariani,
(24:44):
like I'm a 5 million company.
Now, listen to this, how do I get my
business to where it needs to be at
that level to be partners with somebody
now, whether it be now or I need to
get to that spot, but talk about some
things that you had to get the business
(25:05):
to, to be getting ready to that.
I would start with a great TV
show, is on CNBC is the profit.
I don't know if you've ever seen that
before, Tommy.
Yes.
And it's like, according
to him, it is so simple.
Break your business down.
It's the three P's.
It's number one.
It's people.
(25:26):
Two is process and three is the product.
If you do those three,
that results in profit.
And he did add a fourth P and
that fourth P was passion.
And I really believe in that simplicity.
And that's, I did not
plan on this happening.
It just came to be, I knew it
was going to eventually, but the
(25:47):
timing of it, it was so I did not
get the company ready to do this.
It just happened.
But it was because over the years we
had focused on those piece, you know,
it really was those five P's with
the fifth one being profit because
you have to have the right people.
You have to have those processes in place.
(26:09):
You need to make sure that you have
the, you're creating the right product.
And then if you're, if your team has that
passion in the product, that those are
the people, And companies that companies
are attracted and partnering with.
And I look at it as a partnership.
It is not just an acquisition.
It's a partnership and, it's great, but
(26:31):
yeah, that's, those are the things I
would focus on the basics of business.
Don't try to get cute and doctor
your books because trust me,
anybody would find that out.
So it's just getting your,
getting the basics done.
Totally.
You hit a, you hit a, a sensitive
subject, I think for a lot of
business owners and that is.
We talk about that a lot, but
(26:52):
that's that word called profit.
And let's just be real
honest with everyone.
If you're not making
money, that's an issue.
Um, with all the government money
that's over the past years, or you're
not watching your hours, or you're not
making money, or you don't know what
your billable rate is, or you don't
know, those types of things are hurting.
(27:13):
And I feel like our industry
suffers because we almost work
for free for sometimes, right?
And you've heard that across.
The entire country.
Well, the profits just not there.
The profits not there.
Well, at the end of the day, we
are for profit businesses, right?
We work way too hard in this industry.
Landscape business owners are some of the
(27:35):
best people out there in any industry.
I, and I'm willing to bet on that, but
you got to make money in this business.
And you guys have done it, for
the most part, pretty well.
Like, don't be ashamed of making
money at the end of the day.
Can you explain some of that?
Well, you, I mean, it needs to
(27:56):
start with that is that a healthy
business is a profitable business.
If you don't make money, you won't
have the resources to take care of
the two most important things, which
are your team and your clients,
because you will cut corners on both.
So you need to be profitable.
Now that profit comes in different stages.
When we were going through, I
(28:18):
mean, you have the externality of
the recession, that's different.
But then when we were in that period of
growth from 2015 to 2020, during that
period of growth, I mean, you're a five
year period and we were only making
between one and maybe two and a half
percent net income, which is not enough
(28:38):
to sustain where you need to be going.
But whenever you're growing
that fast, things happen.
And so we had a strategy of growth.
It wasn't the strategy of, you're
getting the most on the bottom line.
Now, once we got to scale, once we got,
you know, the processes that really
wanted people, and then we shifted,
(28:59):
our strategy is no longer growth.
Our strategy was excellence.
Once we did that, our profits tripled.
And so then, you know, the, the key is
getting your business to no less than
eight, but I would prefer that people
are striving for a 10 percent net income.
(29:20):
Year in and year out that way.
Some years, if you don't do as good as
you should have, you'll be at eight and
then your good years, you're at 12, 13.
So the key thing is focusing on that
double digit net income and you can do it.
And it's, it is not rocket science
Yeah, totally agree with you.
Talk about, sales, Like you're, you're
really involved in that, side of
(29:41):
the business of Lifescape and sales.
So I feel like this is the year
we're in 2024 where you're probably
experiencing this a little bit in your
business, but sales are not as easy.
As it has been right when, when
COVID was rampant and people were
sitting at home going, do whatever
it takes, I'll spend whatever.
(30:02):
Right.
And so the first.
This, this year has been
a little bit tricky.
And I think everyone can see it, but
what is Lifescape or what are you guys
learning in, in your markets of what you
should be doing and what's successful
right now, it's not easy, but like,
how are you overcoming that right now?
is you hit the nail on the head.
I'm, I'm part of our peer group, you
(30:23):
know, it's like we, and everybody, we
had 12 companies there, Tommy and 11
out of the 12, All had a softness in
the design build backlog and pipeline.
it's across the country.
And so you have to be better at sales.
And so what does that mean?
You've got an hours was, is
(30:43):
that we actually rethought
the whole lead intake process.
How do we provide a better experience
from that first moment that we have
contact with a potential client?
So we rethought that.
How can we have Give them more attention.
Then we went through the next one.
(31:04):
How can we shorten the production
process from creating a design and
getting that construction contract so
that people are out there because now
that they're, you know, everybody's
backlogs are a little leaner.
People can get a project done faster.
And that it's like the last part is that
working through the production making
sure that you are then transitioning that.
(31:27):
Over to the property care team.
So we get that full service of design
build, and then we maintain it.
I love it.
So it's all about the
client experience, right?
And can we take the experience?
And have the most greatest
experience for that client.
One, two, can we shorten it?
(31:48):
Right?
Can we get faster?
Can we get a quote out quicker?
Well, we got to have templates.
Well, in the intake form, we
got to ask more questions.
And out of those questions and
all that data, how do I get
it to the design sales team?
So they got more information before
they go to the on site visit.
Production wise, how do we do pre
planning and get ready for these
jobs and order materials in advance?
(32:08):
Construction schedules,
invoicing, all that.
And you kind of condense them
a little bit more and more.
At the end of the day, you got yourself,
set yourself apart from your competition.
And so it's show up on time,
look professional, speed kills.
Right?
Super.
Go fast.
(32:28):
Say what you're going to do.
Communicate along the way and
few things will set you apart.
But if you do it the exact same way
that you did it last year, you will fail
Totally.
can pretty much guarantee you
Yes.
it's a different market out there.
And I think it'll be this
way for the next 18 months.
Good stuff, Michael.
So, future plans for Lifescape.
(32:49):
What?
You've accomplished a lot in 20 years.
And you know, going from 3 to 36.
Partnership with Mariani.
But what's the future hold
with you and the team?
Is it, we're just going to continue
doing what we have been doing.
Which we are known as not just
local leaders were national leaders.
(33:10):
And now that we've joined forces with
Mariani, that's what we'll just do.
And so we're going to keep
pushing the industry forward.
And quite frankly, faster than
we could have by ourselves.
And so I'm looking forward to the future
and you know, the, you know, I look at
the background that you have, there is
a, the green industry is not going away.
(33:33):
And so we.
You know, it's like you could have as
much AI and everything you want, but
the green industry isn't going away
with the way that we are improving.
Both are the lives of our clients,
both residential and commercial.
So because that we really want to
be leaders in the forefront and give
our team the best opportunities of
(33:53):
leadership throughout the world.
Love it.
That's great.
So as we wrap up, Michael, any last
minute advice for anyone that's listening
out there that you've experienced
in your 20 years of landscaping,
years of 4 H farm, many years in the
wine industry, what's one takeaway
(34:13):
you can leave with our audience?
The most important thing
is be a good person.
Yes,
And it's like, I've had guard
managers say, what's the most
important quality you're looking at
when you're hiring a guard manager.
And so I can answer that question.
I don't care if I'm hiring a
guard manager, I'm hiring a
controller, I'm hiring a designer.
It really is be a good person, be
(34:36):
smart, make sure that you're prepared
for everything that you're doing.
And it's like, at the end of the day,
you'll get exactly what you put into it.
gets you far in life, right at the
end of the day, just be a good person.
the high road and go with it.
So Michael, I've got a few takeaways.
We call these the Tommy takeaways.
(34:57):
This is good information.
But I love the fact that,
watching sales backlog constantly.
What's coming down the pipe?
How much are we bidding?
What does the production look like?
Constantly reviewing that every single
day, week, and month managing growth.
You got to set goals.
(35:17):
Where are you going?
Where's this ship that you're
steering headed towards?
Is it just like in the middle of the ocean
kind of going in circles because there's
no goals and there's no people know?
I love the fact that you have a
winning culture because you need
to know if you're winning or not.
It's no different in football and
basketball and sports in life.
(35:39):
Like, are we winning or not?
Are we just coming in every day,
clocking in, do our job and we clock
out for no rhyme or reason and we go
home and there's no purpose in life.
In our industry or in life find good
people, put them into structure.
That's built the livescape
structure, the process, right?
(36:00):
I love the word high touch because your
industry considers a lot of touches.
Therefore relies a lot on communication.
You said the number one reason
why you get fired is what?
Communication.
Love it.
A huge partnership with Mariani
has probably taught you a ton, but
action today to get your business
ready to have a great partnership.
(36:21):
It's the people, it's the
process, it's the profit, it's
the product and it's the passion.
I love those.
Michael, it's been a pleasure.
You're such a good friend of ours.
We've had tons of visits to Denver
and tons of memories and throughout
a ton of cities in the United States.
It's always been a pleasure having you on.
(36:42):
Thank you for coming on here.
Absolutely.
Thank you, Tommy, so much for everything
that you and McFarland do for us as well.
Absolutely.
We'll see you soon, buddy.
Thank you.
Thank you, Tommy.
Ready to take the next step?
Download our free Profitability Scorecard
to quickly create your own baseline
financial assessment and uncover the
fastest ways to improve your business.
(37:03):
Just go to McFarlinStanford.com/scorecard
to get yours today To learn more about
McFarlin Stanford our best in class
peer groups and other services go to
our website at McFarlinStanford.com
And don't forget to follow us on
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