Newsletter #00067

Happy Sunday!

You’re gonna like this one. If you haven’t noticed already, I like to post about businesses that are approachable to almost anyone.

That’s what I talk about home service businesses so often. BTW, here is a TON of my original content about starting and growing a home service business, all in one place. If you don’t read the email below, you’ll get a crap ton of value from this link. Because hey, you might like the idea of home service businesses but hate the idea of a tree trimming business. If so, that link above is for you!

Also, here’s a link to my master toolkit of business ideas, plans and growth hacks if you lost it. Bookmark it!

But before I continue, can you tell me what kinds of businesses you’d like me to cover with 1 click below?

In 2019 I was building a software startup with my friend Jason. In the beginning, it was not going well and we were running out of cash, fast. We kept pivoting ideas and just couldn't find traction.

During that same time, Jason's brother Mike was starting a tree trimming business. His brother knew nothing about business, but he sure was a smooth talker, and could sell an oil change to a Tesla owner.

Jason started looping me in to help with marketing. Man, what a great business this was! We'd generate leads and at the end of the day Jason would text, "Mike closed 4 of our leads today for $7k! At 60% margins!"

Over and over we kept telling ourselves "What are we doing wasting our time with this startup...we need to start cutting down trees!"

(We were only half joking.)

‍As a recovering domain name addict, I started shopping around, just in case I might want to start a tree business one day. FastTreeCare.com was open for $10, so I bought it. What a strong name! I might name my next son that, actually...

So all you fellow domain name addicts out there, let me tell you, there is hope for you and that domain you keep renewing.

Our startup soon found traction and the tree biz idea was pushed to the back burner, but Mike kept running with it. He's still running it today, actually!‍

4 years later I happened to own a startup incubator/venture studio that has thousands of bright young applicants, hungry and eager to start a business, but without funding or tools.

One of the incubator applicants was James. James was about to graduate from Bowling Green and had a management trainee job waiting for him at Amazon, but he didn't want to take it. He wanted to work for himself. Once you taste that life, there's no going back.

How would you bet he made money in college? By flipping and fixing phones! We obviously became fast friends.

Being active on Twitter, and thinking back to those days of helping Mike launch his tree biz, I wrote a post about how to start a tree biz, and 241k people ended up reading it.

‍The flame became reignited, but I still didn't have the bandwidth to execute. Tons of people DMed me to partner on it, but it never felt right. But hey, maybe James would take a crack at it!

I told James that if he were to move to Dallas after graduation, I'd give him a truck, a big chunk of equity and $4k/month to start this business. I'd pay for his gas and all the funding the business needed, including (and especially) marketing costs. All he needed to pay for was rent, basically.

In addition, I'd be his playbook, his treasure map and his mentor. I'd show and tell him exactly how to start a successful tree trimming business and promised him that he'd be successful as long as he followed my instructions.‍

BUT, I wasn't going to be there with him in the truck every day. He'd be out there on his own.

We'd meet regularly and talk daily, but this was going to be his baby.

‍James saw this as an asymmetric bet. He'd be making half as much than he would be at Amazon, but would be working for himself and could potentially build a big, profitable business, and fast.

‍He was in.

Before committing, I flew him out to Dallas for tacos and he stayed in our guest bedroom to make sure we were a good fit for each other.

Like a glove, baby! Can you tell his dad played football for USC?

A couple months later he'd found an apartment and was driving all over the metroplex. Here are the key points to this whole business model:

1. We are a lead gen factory with a truck. Period. Marketing machine maniacs.

2. We need good tree crews to sub out the work to.

3. Sales are at the heart of what we do. If we're hopping in the truck to drive from Richardson to Frisco, you better believe Miss Margaret is going to let us cut down her trees and leave us a 5 star review.

4. We don't own any chainsaws, but we know how to talk the talk.

5. The crews need to wear our shirts and share our core values.

‍I could go on and on about the market size and opportunity, but you already know. People have trees, people love trees, and trees fall down and die, and they always will. It's a $37,000,000,000 recession-resistant industry with unsophisticated owners.

Perfect.

Also, like many home service verticals, it's the type of business that generally isn't constrained by lack of customers. It's constrained by labor.

Labor is a challenge and always will be, but it's a challenge I'd rather have than lack of customers.

Anyway, back to James. James packed up a trailer, moved to Dallas and was eager to get to work.

Here’s how the 2023 timeline of events went:

• Early June - James incorporates the biz and gets insurance in place.

• Late June - James moves to Dallas and finds an apartment.

• Late June - James’ roommate sucks and keeps his deposit, so he finds a better apartment with a better roommate.

• Early July - The biz is launched, but it’s going slowly. It takes about 2 weeks to find our footing and our first job. Yikes. The first job is always the hardest. We’re looking for crews and our first job at the same time. We’re building a plane as we’re falling from the sky. This feels familiar!

• Mid July - James is planting yard signs all over DFW and getting cussed out by HOAs. We finally find a couple crews but aren’t sure if they’re any good or not yet. The best crews are too busy and the worst crews don’t show up.

• Mid July - We get our first job! $200, lol. We'll take it! We’re stoked. Right now we're looking for traction and 5 star reviews, not profit.

• Mid - Late July - More jobs! We clock $3k in revenue the second half of July without really trying much online marketing yet whatsoever.

• August - We start finding our groove and learning which crews we can rely on and end up booking $17k in revenue, profitably.

• September - We really start ramping up some proprietary marketing methods (not just FB and Google) and now we are constrained by crews and not jobs. $33k in revenue at 30% net margins.

• October - More of the same, but on track to double again.

What now? Well, we’re content being a profitable tree trimming business.

We hosted a tree biz bootcamp a year ago and showed about 20 people how to do what we do:

1. Quote jobs in the field and over the phone

2. Get the right insurance

3. Find, interview and train crews

4. Marketing marketing marketing marketing

5. Partner with HOAs, landlords, realtors and companies

6. Anything else they need to know to be successful in this biz

We recorded the whole thing professionally so if you’re interested in that, just let me know right here and I’ll send you more info:

I hope you found this helpful, inspiring or interesting, and I'm always looking for feedback. Thanks for reading!

Chris Koerner
chrisjkoerner.com