Is There Something to This Theory?

There are tons of people out on social media giving business advice. Some of it is good advice, but most of it isn’t good. In this new series watch CapForge’s owner react to different advice videos. He’s an expert in all things business and has 20+ years of experience under his belt. Some of the things he reacts to might even surprise you!

CapForge Founder and Owner Matt Remuzzi reacts to this theory about scaling and growing a business. 

Video Transcript: 

Business Advice Video: 

Let me just give you a little theory about growing and scaling, and it’s the theory of the plumber. I had a toilet break and I needed a plumber. So I go next door and the guy says “Call Ronnie Boone. He fixes everyone’s, he’s the best plumber.” So I call Ronnie Boone up. Ronnie Boone shows up that night, fixes my toilet. Cheap, efficient, it was good. And every time you needed him, he was there for you on the spot. He just kept getting busier and busier and busier. As he got busier and busier, busier, now instead of calling him up he’d be there that afternoon, “Oh, Jeff, I can get there…” like you know I called mine on Monday, “I get there before the weekend cause I’m you know doing this install. I can get there Thursday.” Alright maybe I can wait but he got busier and busier. 

So finally he’s like man “I got a scale and I gotta grow”. So, he gets an apprentice. Now he has a second truck. So now he’s got 2 trucks. He’s doing half the plumbing. I might be able to get him instead of Thursday, like in 2 days. He’s getting a little bit better service, but he still staying busy

because he built such a great reputation as a plumber. So now he has 3, 4 trucks okay, but got to grow, got to grow.

I don’t see Ronnie for like couple years. I run into him sitting at Pete’s Dancing Marlon bar. He’s having a burger and a beer and I said, “Ronnie Boone, I haven’t seen you in a while”. He goes, “Man, life sucks”. And I go “What do you mean? I see your trucks all over town.” He goes “I don’t fish anymore. I don’t see my family. All I do is like putting out fire’s here. This guy doesn’t show up. I got to manage this. This truck’s broken down. I’m sitting in an office all day because I don’t even plumb anymore.” “Like Ronnie what are you gonna do?” “Because I should go back to just having one truck and plumbing because that’s when I go fishing on weekends. I enjoyed life. I saw my family and everything.”

Matt’s Review: 

Okay, well I mean that’s a pretty classic entrepreneur story of growth. But Ronnie’s problem is not that he should go back to having one truck and doing it all himself. He could, but the problem with that is when you wanna take a vacation, well guess what, you’re still – your customers are still having to wait a week or more for you to get there, they’re gonna call someone else in the meantime. And maybe that’s okay but then you get sick for a couple weeks or a month, now you’re not making any income and life gets pretty stressful at that point. You never really get to take any time off. You never get to relax. You never get to save for retirement. You’re always just grinding away, doing those – you’re putting out the same daily fires that you are when you’re managing people. It’s just different fires, right? Your truck breaks down, you get a tough job, you get an angry customer, you’re dealing with 100% of everything. So when you’re managing four or five trucks or half a dozen people or a dozen people it might seem like going back to that one-man shop is a lot less stressful. You remember the old days, “we didn’t have to deal with all that stuff.” But you forget the old days where you were stressed out about not having enough jobs to pay the bills or having too many jobs that you couldn’t get to and working 12 16 hours a day to try to get to everything and keep people happy. And then wanting to take time off but never being able to because there was always something else to do. 

So the real answer here is not to stay a one-man business, um it’s really to put systems in place. To put operations in place so you’re not still the key piece of the business but now instead of just you it’s 10 or 12 or 15 people. So Ronnie’s problem, Ronnie’s solution, the solution to Ronnie’s problem is not to go backwards, is to figure out where those bottlenecks are, figure out what those things are that he shouldn’t have to be dealing with, that there’s better ways to deal with and put solutions and processes in place. And then Ronnie can go back to fishing, he can spend more time with his family, but he can still be making two or three or four times what he was making when he was by himself. And if something happens where he’s can’t work for a week or a month or something else his income doesn’t stop and the business doesn’t fall apart and everything doesn’t hinge on him. So it’s sort of a false fallacy, that the one-man business is somehow this Utopia situation, and as soon as you have employees and you grow it becomes hard and stressful and that’s where things all fall apart. It can happen that way, but that’s a decision you’ve made or failed to make. And it definitely doesn’t have to happen that way.