July 29, 2025 • 47 mins
Chloe Brown, founder of Wildest Dreams, discusses the importance of accurate job costing and financial tracking in construction. She highlights that many builders fail to recoup thousands to hundreds of thousands of dollars per job due to inadequate financial management. Brown emphasizes the value of using tools like Adaptive for better integration and efficiency, noting that Adaptive's user interface significantly outperforms QuickBooks. She also stresses the significance of optimizing the Accounts Receivable (AR) cycle to improve cash flow and financial health. Brown offers free consultations to help builders improve their financial operations.
https://www.thinkwildest.com
Show Notes:
Chloe Brown's Introduction and Background (0:00)
Chloe's Sales Consulting and Custom Solutions (1:45)
Transition from Custom Solutions to Adaptive (12:30)
Case Study: Uncovering Unbilled Costs (12:45)
Impact of Cost Codes and Financial Tracking (16:27)
Forensic Audits and Adaptive's Role (26:00)
Improving Cash Flow and AR Cycle (31:44)
Technology's Role in Construction (47:01)
Find Our Hosts:
Reece Barnes
Matt Calvano
Podcast Produced By:
Motif Media
Mark as Played
Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
(00:00):
Typically, what we find isanywhere from 1000s of dollars,
(00:03):
10s of 1000s, hundreds of 1000sof dollars on any given job that
was spent but not recouped.
I am so glad that you're onbecause I think you have a very
(00:24):
unique and a very valuableperspective, specifically,
obviously around, like,construction, accounting and
operations. Obviously, you'vebeen a partner of ours forever.
So I say we just talk about,like, what you're seeing in the
market, generally, that buildersstruggle with.
We can do some of like, theeasy, like basic fundamentals
that they need to have in place,but even talk about some of the
(00:47):
more strategic things thatyou're seeing the best builders
do. So that's what a lot of thisthreat will be. But for the
listeners, who is Chloe Brown?
Chloe Brown, well, I think it'sfun to say how we met, which
was, I was walking around aconstruction Conference, which
for any, any builders, any anypartners who have ever walked
(01:08):
around one of those. I don'tknow if you're like me, but
you're, you're pretty muchdodging every booth that's
trying to reel you in. And I'mlike a professional dodger. I'm
very good at that. And when Iwalked by adaptive, I could not
dodge you read like you pulledme in. So good. And we've been
Yeah, friends and peers sincethen.
(01:28):
Yes, I am a, I am a professionalattention getter. And okay, but
actually, what was it thatpulled you in? What's the
difference there? Pump my tiresa little bit. What worked? Well,
you I remember that you werejust, you were asking really
good questions, and it's a lotharder to just walk past someone
when they're asking really goodquestions than somebody who's
(01:49):
just kind of trying to pitch youthe product right away. So,
yeah, yeah, I guess we'll notthat. I'm a Sales Consultant,
but we can just slide a littlesales tip in there.
Yeah, exactly. Well, that's whatit's all about, right? It's
like, it's really hard to solvesomeone's problem if you don't
know what their problem is,right? So no, that's great,
yeah. And it's honestly, I thinkyou were using what air table
(02:11):
and like, kind of amalgamationof other tools and stuff like
that.
Yes, good memory. We were doingcustom solutions through air
table and some other lightweighttools. So I guess, introduce
myself. I'm not a salesconsultant. I am the founder of
wildest dreams where we reallyour core focus is helping
construction companies make moremoney on their jobs. That's
(02:33):
where we start with companies,because we really believe that
if your core product isn'tmaking money, if the financials
of that core product don't makesense then, like, it doesn't
really make sense to look atlike, can we grow the business,
or can we create leveragesomewhere so and the way that we
do that is through one, verymeticulous, job level, Job
(02:56):
Costing, job level financials,and two, through leveraging the
best kind of cutting edgetechnologies that the
construction industry has tooffer. So
totally I love it, and that's Iso I think, just like over the
years, because I've just beendoing this for almost 10 years
now, of talking to builders,processes, Business Solutions,
technology, you obviously, youtalk to people that impact you,
(03:20):
and you hear, you know, commentsthat they make and takeaways,
and I probably got it from youor less, we're just organically
that aligned. But point beingis, why in the hell would you
try and scale something if youdon't know it's making money,
right? Or even not even justmaking money, but you're making
what it should be making, right?
It's like any other widget. It'dbe insane for Apple to be
scaling iPhone building if theydidn't know they were going to
(03:43):
be netting X on each unit,right? So I think that
transferability into homebuilding is is easier said than
done, just considering all thenuance with an 18 month product
that you're building, right, ora 12 month, six month product
you're building, but also justwith the craziness and invoicing
and accounts payable,receivable, stuff like that. So
I probably got it from youbecause I pitched the same
(04:05):
thing. It's like, what? Why? Whyare we trying to, like, take on
more units when we don't knowwhat we're making
on our current units? Yeah,well, and an idea that's
definitely not new. And I think,you know, every anybody in
accounting and construction saysthis and beyond, I'm sure is a
lot of business owners will say,Well, I have money in my bank
account, and that's kind oftheir litmus test. So, so I must
(04:26):
be able to hire, so I must beable to grow. But what they
might not be thinking about ismaybe some of that money is a
customer deposit for a jobstarting in three months, or
maybe that's sales tax moneythat you need to pay out, or
business tax. There's so muchthat's wrapped up in that bank
account number that doesn'tactually tell you really
anything about whether or notthe business is performing well,
(04:46):
totally100% well. And so let's, like,
kind of thread into that. And Iam curious, from like, maybe a
more rudimentary standpoint, isthere's a lot of tech out there.
You guys are building customsolutions, leveraging,
leveraging products like air.
Airtable and other products.
What was the big like aha momentfor you to move off of building
those more custom solutions, airtable centric processes into
(05:09):
something like adaptive?
Yeah, so I will say we stillleverage those tools
extensively. So I My backgroundis in startup tech, my sort of
ethos that I'm that I'm bringingto our clients, is use the best
tools for the job that you needto get done, just like they
would do on the job site. So ifthere is a, you know, vendor,
(05:32):
documentation, compliance toolthere, which there are many out
there, if they're not hittingthe mark, we're going to still
kind of use our tools and do itthe way that we think is best
when, in terms of an aha momentor making the switch, is when
you do find that product that'sdoing not only what you had
custom built, but But 10 timesbetter than what you can do,
which you know not to make thisdo sales pitchy for adaptive,
(05:55):
but I mean definitely the case.
Adaptive does what we couldnever build, kind of custom in a
solution of ours so, and I thinkpart of that is integration with
your accounting software,integration with the general
ledger, and it's hard, it ishard to maintain the systems
that we build kind of in housefor clients. So it takes a
little more legwork.
(06:19):
Totally, totally Well, and,yeah, certainly not to keep this
as like a sales pitch, but I do,I think this is going to be like
a good segue into large like.
I'm wanting to, like, really getsome more context to the blog
that you did with us on I thinkit was like, you uncovered like,
5 million and unbilled costs.
And I think this would be a goodsegue so we don't have to worry
about this being like a salespitch for adaptive but for like,
(06:42):
the specifics you'd mentioned,like, integration, but like, was
there anything else that, like,really stood out to you? You
mentioned vendor compliancedocs, which we obviously do, I
don't know if you're using themwith your clients, but like,
what were some of the big piecesthat you could, like, even
advise builders to look at whenthey are evaluating tools, or
even looking at AdaptiveYeah, I think I mean being able
to really see the link betweenyour expenses and your draws and
(07:04):
and covering all of your tracks,knowing, if you're curious, oh,
shoot, did I bill out? You knowthat vendor charge? You can look
in your you can look at thatexpense specifically, and see
right there in the expense whatdraw it's tied to, plus all of
the reporting that you guysexecute too, through draws. I
mean, I think I could go on andon, but I off the top of my
(07:25):
head, those are a couple thingscoming to mind. Is just being
able to, sort of like, followthe thread of the expense to the
draw, which is so important fora builder. And then maybe the
second is the way that that allfeeds into the job budgets page,
so you know, you have thequestion about that expense, and
now you can compare it to yourbudget and see if that cost
code, so talking not even justabout job performance, but like
(07:51):
cost code level performancewithin that job
totally well. And I think that'sgreat, because, I mean, that's
really, I think when people lookat adaptive, or maybe even hear
about it is like, I think it'sreally easy for them to glom
onto, like, this time savingidea, which it does for sure.
But I think, like, what you'reoutlining is the more valuable
(08:11):
ROI, which is MIT, like,preventing those misses from
happening. It's a cash flowmanagement tool. It's a
financial operations tool,right? It highlights those big
misses that builders comeacross. I was just talking to
another builder out of StGeorge, Ron Jensen. Shout out,
Ron. We'll probably have him onthe podcast here soon. But point
(08:33):
being is, I was just like,talking to Ron organically,
naturally. And he was like, justtotally off the cuff, and he was
pitched on time savings when hebought and he's like, Reese,
we're actually seeing like, anuptick in profitability, because
there is not a single receiptthat leaves this business or
comes into this business thatisn't properly categorized,
(08:53):
right, that isn't late. We'reclosing books out on time. We're
making sure that we're hittingour profitability. We're making
sure that we have the income tocover those expenses and those
costs, right? So it's beautiful.
Yeah, go ahead. Oh, I was justgonna say, I think when you talk
about time saving versus value,I think any construction or like
skill, someone that started withskilled trade can appreciate
this comparison is you shouldn'treally get interested in doing
(09:17):
something faster until you'redoing it really, really well. So
we need to make sure we're doingsomething really, really well.
And then it's a it becomes aboutspeed.
Totally. What are some of thethings that you see builders
trying to do really fast, maybenot as much like an umbrella,
but like tactical that you seethat just like bites them, that
(09:37):
you're you and your team mightcome in and correct,
yeah, I think, I guess, to riffoff of Ron, who I also know. So
shout out to him. You know, Ron?
Love it. Love it. It is the job.
Job level financial coding, likethe job costing, where it's
like, okay, well, we'll just putthis in this job code, because I
don't remember, or I went toHome Depot. I don't even know
(09:59):
what job that. For. So let meforget about that. And our ethos
is really like, let's let'strack every dollar. Let's track
every dollar you're spending.
Because if you know it's like,the way you do one thing is the
way you do everything. So ifyou're really loose about this
receipt, your team is going tosee that. They're going to be
loose about theirs. And then itjust all starts to fall apart
from there. And I think that'swhere dollars become 10s of
(10:21):
dollars or hundreds or 1000s ofdollars on a given
job totally well. And so I lovethat point of like, how you do
anything is how you doeverything. Like, so when you're
working with your customers, isthis like coaching them on how
to do it? Is it largely likecreating a process for them to
(10:43):
follow? What would you say youspend most of your time doing to
prevent those types of well,just throw it here, and we'll
deal with it later. Type, yeah,that's a good question. And
something we as a business haveevolved on a bit ourselves in in
the beginning, which is stillwhat we do, is we come in, we
assess just what are the currentoperations? We will do a process
flow, you know, map out everysingle step. I think that's, I
(11:05):
like to think that's somethingthat makes us different. Maybe
some from other firms peoplewill work with is that
operational piece. So, like, howdoes the guy get from the gas
station without the receipt backto the office? Like, all of
those details. And then we lookfor opportunities to really
optimize for the sake of dataand making sure that data gets
where it's going. So we do sortof that as maybe more like
(11:26):
process strategic consultingside. And then in some cases, if
there's a really sophisticated,you know, office manager or
somebody in the office, then wecan kind of train and implement
on some of the processes thatwe've seen create a lot of
success, but we have begun moreand more actually offering
monthly recurring accountingservices for our clients to then
(11:49):
support execution on thosebetter processes. And we have
found more success when we kindof like, stay involved on a
monthly basis.
Totally, totally. That makes aton of sense well. And like,
even, even when you've got,really, what I'm picking down
you mentioned, like, asophisticated office manager,
and also, like, providing theseservices, like, I think it
(12:10):
really has to do with, like,ownership and accuracy and like,
what's getting done. And I thinkthat's a good segue into, like,
I'm just dying, and here we are,like, 12 minutes, and I'm just
dying to know the details andlike, actually hear the story on
the builder that you ran thecase study with. You do not have
to share names, entities,anything like that. Like, I
(12:30):
would love to know how you metthem, what was their state when
you started working with them,getting to a point of
realization of what needs done.
Right? Execute, like, what wasthe story?
Yeah. So I think we can do this,like, you know, one of those
based on a true story, whereit's like, this is an
amalgamation of severaldifferent characters. Because
(12:50):
the reality is, this is the casewith every single client that
comes to us. That blog or casestudy was maybe the biggest,
sexiest number. Yeah, it's, it'sit's like that with every one of
our clients. And typically, thesort of like story that happens
is we start engaging with abuilder or GC. They know
something is falling through thecracks. They know they're not
(13:11):
making as much money on the jobas they should be. And when we
start digging into theoperations of, okay, well, how
are you tracking these things?
They're either tracking them inspreadsheets, or maybe
handwritten in some cases, orit's like three or four
different people that are allmanaging the data, trying to get
it into one place. All that tosay that when they really look
(13:32):
into it, they actually don'tknow where all of the
transactions are happening. Ifthey're doing cost plus they
they're pretty it's pretty clearthat they are not recouping for
all of those transactions. Sosure when, when we assess that
and we figure that out, we divein a little bit deeper, and
we've with the help of adaptivewhich has made made this process
(13:54):
significantly more efficient andmore accurate for us. We also
have kind of an in house systemthat we've developed to do a
very meticulous, detailedproject audit, where we
essentially, it's almost like aforensic job analysis, where we
go back through the whole lifeof the job, and we re we piece
together every transaction andevery draw and make sure that,
(14:16):
well, make sure and find all ofthe transactions that have not
been billed back to the client.
So in that process, typically,what we find is anywhere from
1000s of dollars, 10s of 1000s,hundreds of 1000s of dollars on
any given job that was spent butnot recouped. And for any
(14:39):
builder out there who is hearingthis and thinking, Oh, well, I
you know, that would neverhappen. I would never miss out
on hundreds of 1000s of dollarsof transactions on one job,
which was how we got to the 5million with that one client,
their high end custom homebuilder, several really big
jobs. And that is, that is wherewe got at the end of doing
project audits across. All theirjobs. Anyone listening that
(15:02):
thinks that that isn't happeningto them? I will. I would love to
take a look at your books,because I have not worked with
any anybody yet, from verysophisticated to, you know, our
more kind of, I'll say, like ajunior level owners who, who
doesn't have that problem.
I think that's like, what Ithink is super powerful, because
(15:29):
we see the same thing. And,like, it could be like, are we
just, like, building this echochamber? Is this problem, like,
actually that rampant in theindustry, right? You see it? And
I think that the conversation isless about hundreds of 1000s of
dollars, no way, or hundreds ofdollars. Who cares? Right?
Right? It goes back to thatconcept of, what are we trying
to scale if we don't know whatwe're scaling, right? It's like
(15:52):
it has nothing to do with are wemaking money. It has everything
to do with, are we making themoney that we should be and if
we have these opportunities,project over project, year over
year, that we're not capturingincome on. We're not getting the
money that we should be doing.
We're monetizing a hobby less,running a business
totally. And I love the way yousaid that, too, because even if
(16:15):
it is the guy that or thebusiness owner that's saying,
well, if it's a couple $100 hereor there, who cares? The
question back is, okay, how muchrevenue are you doing this year?
Oh, a million. Okay, what if inthree years, you're doing 5
million now? How many now? Wheredoes that $100 kind of land if
you're using those sameoperations, it that is scaling
your your success compounds andyour issues compound as well.
(16:39):
Totally fix, fix those issues,totally so for you mentioned
cost plus, I guess when you'rewhen you're looking at these
builders, and you're pullingback, you know, the curtain
really doing a deep dive, I dowant to touch on the forensic
side of things, maybe even,like, a little more tactical,
how are much willing to share ofthat process you actually get
(16:59):
into. But when it comes to thesebuilders, cost plus is like, I
think kind of the the posterchild for it, because they're
billing their customer directlyfor cost, with a markup,
including their margin, right?
But are you seeing, like, eventhis cash leakage or profit
erosion happening with fixedprice builders too? And what
does that look like for them?
Yeah,totally. So I think in the first
couple years that we wereworking, even with adaptive, you
(17:22):
guys even were like, well, we'rereally, you know, for cost plus,
not fixed price. And we weren'tworking too much at that time
with fixed price. And sincethen, we actually just did a
huge cleanup and onboarding withan owner who owns several
different construction companiesall fixed price billing, and
what I realized I was makingthat mistake early on. And I
(17:43):
think you guys were too to thinkthat there was no value, because
even if it's fixed price, theyhave to be coming up with that
price from somewhere. And ifthey can't look at their
historical jobs and get a reallyaccurate hold on how much did we
spend and how much did we make,it's the same problem is a cost
plus builder, like the data theyneed is the same. So, yeah, so
(18:03):
we just did a big implementationfor multi entity builder, and I
know he's thrilled because hewas tracking in spreadsheets. It
just lacked that accuracy thatnow he will have on the job to
moving forward so he can say,okay, you know, I thought I was
going to make 30% markup on thisjob, but it looks like it was 25
(18:24):
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(19:31):
Build better. Okay, so you'refinding for the fixed price
builders, big entity guy, he'ssuper stoked, I guess when it
comes to like, the differencehere, and you're talking about
the historic side, how I pitchedthis to builders is whether
you're if you're cost, plus youcan't, plus what you don't cost
(19:51):
if you're fixed price, it's arace to margin. You had
mentioned. It's more of like ahistorical benefit to know,
like, how are we actually doingon these jobs? Jobs. But do you
see any of these concepts inthis profit erosion happening in
real time for fixed pricebuilders during their jobs?
Yeah, definitelymean, because they're always
bidding that next job. So whenwe start putting those
financials together on a jobwhere it's fixed bid, the
(20:13):
contract is signed. No matterwhat we show them they're
spending. They are where theyare on their revenue. You know,
they're, they're continuing toput together estimates. So when
I say historical, you know, it'shistorical, but it is in real
time, because they can correctas they go. They don't have to
wait, you know, months or evenyears to sit down and look at
(20:33):
their data. They can just pullup the job budget right away and
see, oh, shoot. These last threejobs I bid are underperforming
by 5% I probably should bumpthis. This bid up 5%
Yeah, totally. Do you see itbeing more of an aggregate bump
for them? Are you a part ofthese conversations, like when
(20:54):
they're actually biddingtheir jobs? We don't get too
involved in the estimate sidefor us, it's more of a
conversation around because, Imean, we're not construction
experts, and we in terms ofdelivery, and we don't, you
know, claim to be sure, but weare able to make these, see
these kind of, like, trends,historical trends, and and
provide some guidance there,like exactly what I just said,
(21:15):
Hey, the last three jobs thatyou started, you're, you know,
25% of The way in, and this ishow it's trending. Let's talk
like, whatever you're biddingyou might want to think about
that totally, totally.
And I was just curious, becauseI like, I imagine it's more of
like, from a line item by lineitem basis, of like, when you're
going through and you're doingthese post mortems on jobs, and
(21:35):
you're like, there was a 5%bleed on this, and it was
largely because of these threelines, we need to take this in
consideration on a future job orwhatever.
Yeah, definitely. And we look, Imean, we've talked a lot about
just looking at the job budget,where we look at a range of
different data sets, we look atthat variance by vendor. So
which, which vendors did youthink were going to come out at
(21:56):
x that came out at Y? We look atthe cost code level to see, is
there just a consistent costcode problem? Is there, you
know, a certain like link tothat, whether it's a particular
project manager or team member,maybe it's a group of jobs
managed by a certain team. So welook at the data in all
different ways, not, not justright at face value,
(22:19):
totally. I You mentioned thecost code thing, and that's wild
to me, that it's still aconversation like truly again,
it could be like an echo chamberthing, right? Like I'm talking
to builders. Cost Codes arenormal, but when you get into,
like, the sales side ofadaptive, and us talking to
builders that are interestedenough to take a call or see a
(22:39):
demo, or they heard about us, sothey want to come in, you start
to peel the layer back. Like,how big of a problem do you
think cost code structures arefor builders?
Well, I mean, you're kind ofsaying it what you're you're
just as much. I mean, youprobably talk to more than I do.
Like, what do you what? Whattrend are you seeing is, is it
that there's too many is thatthat they don't know? How do you
like? What is the problem yousee,
(23:01):
I love that you're shooting thisback to me. I truly, I love it.
Um, my perspective is, is, Ithink there's just like a true
gap in understanding theintention of cost codes. Agree,
I don't think that. I think theyknow what they are, but I don't
think they understand how theyshould be leveraged in the value
that they can pose at abusiness. And I say that
(23:24):
primarily there's there's onebuilder that comes to mind, and
they're like, we can't everstick to a set of cost codes,
because the owner always likesto add new cost codes. And it's
like, if that owner understoodthe intent of cost codes, they
wouldn't be adding cost codes,right, right? They would
understand that it's like, it'sabout consistency and building a
(23:48):
framework to where you canactually track your costs
consistently, month over month,year over year, yeah, and
understand the health of thebusiness. What's your take?
Yeah, no. I think that was wellsaid, and it's Yeah, because
every time you add a cost code,that new bucket has nothing to
back it up for, you know, untilyou build up all of the data
behind it. So I push back. Idon't, I wouldn't necessarily
(24:11):
say there's never a reason toadd. I think there are
situations where, for you know,there might be, like a bank
lending situation, wheresometimes the bank actually
requires certain line items tobe broken out of certain so
there are situations. I thinkeverything you just said, I
fully back up. I think what Iwould add on to that, that I see
that drives me crazy, it'sthere's something about the
(24:36):
industry that can be a littlebit of, like a little bit of
high school, where it's like,well, this person's doing this,
so maybe I need to do that. AndI that with cost codes, where
it's like, well, so and so. Andthis build, builder group, elite
builder group, I won't name, isusing these, you know. And so
what we do with builders a lot,there's certain things that can
be templatized, but there areother things where we really
(24:58):
need to talk about, how doesyour. Business operate. How does
your team think about thesetransactions, and how do you bid
the project? And let's make surethat the cost codes really fit
your job, rather than havinglike, 500 Cost Codes. That's a
list that you got offline or gotfrom a up here. Totally Yeah,
because then they implementthose and they don't understand
(25:20):
them, and then they don't usethem properly,
exactly, exactly, and that'swhere it even goes back to like,
the wrong story of like, like,you've got, you've got to
commit, right? I think you'vegot to commit. You've got to
know what you're committing to.
And if you can, that's whenyou're going to start to see
those benefits come through.
Definitely. Yeah, yeah. I have aclient we've worked with for a
(25:40):
really long time, who is veryself made, and his cost codes
are don't look like anybodyelse's. I'll put it that way.
And I think sometimes he hasthat sort of like imposter
syndrome, where he thinks theyshould be fancier or better or
have bigger words in them, andwe just his financials are
really strong, and we just talkabout how they're working for
him, and why they're working andfor their team, and that there
(26:03):
really is no need to changethem. Nobody's looking at them
besides us, right?
So, dude, I love it. I love it.
I am curious on you mentionedthe forensic side early on, and
I've heard this from several ofour partners, how they'll
leverage adaptive to justuncover these types of
nightmares, but also, like beable to execute on a forensic
(26:25):
deep dive much more quickly andthoroughly. What are how are you
leveraging adaptive for that?
Or, I guess, how do you run thatforensic side? And again, if
you've got the secret sauce, youdon't have to share everything,
but I'm curious, like, what youguys do there?
(26:45):
No, it's funny when you saidthat earlier, about, like, not
uncovering secrets, I'm I'mlike, I'm happy to to show
anybody what we do, because itis freaking hard, like, it's,
it's not easy, it's a lot ofwork, and it's a process that we
learn and we perfect every timethat we do it. So I welcome
anybody to to attempt this aswell, because I think it's very
(27:07):
specialty that we're evenwilling to do it. But so I think
I mentioned earlier. I mean,basically we are, it's like
forensic in the sense that we'relike rebuilding the whole crime
scene piece by piece and tryingto figure out where everything
goes. We have to work a lot withthe builder, obviously, to do
that, where adaptive comes intoplay is if they've already been
(27:28):
using it amazing. It gives us aton of visibility if they
haven't been using adaptivewhere it's really helpful, which
I don't know that this issomething you end up talking
about a lot with adaptive, butit's it's probably so overlooked
is the UI and the interface ofworking in adaptive supersedes
(27:48):
QuickBooks by a lot. So it maybe that there is a lot of this
work we could do in QuickBooks,but it would, and this is where
we get into time savings, itwould take us a lot longer and
it would just be a lot morepainful. So all of like the
filtering views, bulk editing oftransactions, being able to look
(28:09):
at transactions in differentreporting styles by really any
variable we want to look at,that helps us to do this
extremely tedious work. Doesthat answer your question? I
don't know if I like processnecessarily explain the process,
but no,this is, this is perfect,
because that's like, even how Iexplain it, like, there I will
there. You know, there'scertain, like, certain builders
(28:30):
that you never forget, um,especially like being in sales,
right? Like the experience of,like, you know, them starting
the conversation and thenstarting to see the light in the
conversation, and then gettinginto the product, right? And
then there might be, like, somefriction, or some like, oh shit
moments for him, right? Therewas one builder. It was in the
early days. This was like,probably, like, May of 2023, and
(28:54):
they were using another productthat was synced to QuickBooks,
and they were, like, skepticalof adaptive. They're like, we
think we're getting this done,but like, we're com, it's
compelling enough for us to try,like, we'll get into adaptive.
And they'd sync their QuickBooksto adaptive, and they like,
immediately shot back. Like,your product is trash. It's
showing our books are total, atotal mess. Like, there's no
(29:17):
like, how is it even suggestingthis stuff? And we're like,
obviously, six months into go tomarket, like, digging into it,
right? And we're like, let'slook at your quickbooks file,
and then we start to uncoverit's like, no, you actually do
have hundreds of bills that arestill open from 2017 Right?
Like, you do have dozens ofbills that hadn't been synced
(29:43):
properly with jobs, right? Andthen that was like, they're
still customers of ours today.
Like that was the like, you'rethe immediate enemy to the
you're the Savior that quickly.
And I think it goes into that,like, just my question
originally to was a forensicprocess, look like? You aced it
with the simple UI, right, andthe thoughtfulness of the
product, but it literally, forthis guy, was syncing QuickBooks
(30:05):
to adaptive and like gettingthis, like overwhelmed moment of
I've got a lot of stuff that'swrong in QuickBooks, and because
QuickBooks is so difficult tounderstand, and so few people at
an organization actuallyunderstand it to a level of it
being helpful. It creates thisdynamic where, like, business
(30:25):
owners will stick their head inthe sand saying, this is this
person's role. Everything'sgood. Did we make money this
year? Yes, good. On to the next.
Meanwhile, they've got thesecompounding issues that we've
already talked about in thebeginning of this episode that
are just like just hovering overthem until they get addressed
totally and you just nailed it.
It's like you said that sobeautifully. Is like they make
(30:47):
it one person's job because theyknow that diving into
QuickBooks, they can't evenbegin to wrap their minds around
that, which I totallyunderstand. And then the fact, I
mean, that's that's a ROI foryou right there on using
adaptive or a tool like it is,you plug it in, and in five
minutes, you can suddenly seeall of these things that we're
hiding in your QuickBooks thatyou never would have really been
(31:07):
able to see yourself and alsomaybe identify that this poor
person that you have made it tobe their job, perhaps that's not
fair to them and that theyreally need more support,
because I've had owners in thatsituation in the past, and
they'll kind of respond and I'llexplain the process of cleaning
up their QuickBooks so thatadaptive is accurate, they can
(31:31):
see the data, etc. And then theymight get overwhelmed and say,
Oh, well, whatever. Like, we'remaking money, it's fine. And
then if the explanation of,okay, well, that's your general
ledger. That's like, literally,the kidneys of your business, if
that's not correct, taxes,aren't, you know, and on and on.
So,yeah, totally, totally, no. And
I think that kind of to thepoint of the individuals. I
(31:53):
mean, there's, like, there'scertainly a lot of pride that
comes with the money side of anybusiness, right? Accounting,
Finance, bookkeeping,controlling stuff like that.
Rightfully so. There should bepride that maybe, maybe pride
motivated by fear, right? Andthey want that control over the
(32:13):
process. And it's kind of like alose, lose situation for them,
and in a manual world because ofthe reality of the volume. And
not even, like just the volumeand the quantity of the
invoices, receipts, A, P, A, R,it's the volume and the zeros
(32:35):
that come on these transactions,building these huge projects,
right? And it's like, if there'sjust a single, simple error, it
could be you hit the decimalinstead of the extra zero, and
it's throwing everything off,and it's impossible to go back
and find so again, I think, likewhen you're talking about this a
(32:55):
it's like, it's worth it, justto understand the the the the
health snapshot of your books.
But also, again, it'sleveraging, to your point of
what, while the stream is doingis like, leading, leveraging
leading edge technology toassist the process.
Yeah, yeah. I think it'stechnology. And it's also
(33:16):
finding, like, not to promote,but find, and truly finding the
right people to help you dothat, not not putting the weight
of your business, the financialburden of your business, on your
office manager, or, in somecases, it's people's moms or
brothers. It's it's unfair tothose people. It's unfair to you
as the owner. And there arepeople out there that are doing
(33:38):
this very well, that can helpyou. And I am, I think, with
what we're talking about, we're,like, ragging a little bit on
the business owner. That's, youknow, doing these things. But I
am seeing, in the years I'vebeen doing this a shift, like
there is a new wave happening, Ithink, in the industry, and a
turnover, case in point, thesuccess of adaptive, or the
success of wildest dreams. AndI'm curious, because you've been
(34:00):
doing this for a while too, evenbefore adaptive being with prior
construction software companies.
Like, what, what are you seeingas the change, like, in what
we're talking about? Like, doyou feel like the clouds are
parting?
Yeah. So I think so. My answeris largely gonna be around,
like, your comment towards,like, ragging on builders. I
don't, I don't think that it'sas much as ragging on builders
(34:24):
as there's been more discussionand conversation brought up
about the reality that they dealwith, right? And sometimes the
reality isn't pretty. And toanswer your immediate question
of like, how the market isshifting, is, I think that
builders, after 2008 recoveringfrom that, lot of businesses
(34:46):
were born. A lot of businesseswere failed there in
construction. Get over thathump, then we see covid 2020,
tons of supply chain issuesmatched with truly historical
low interest rates. And you'vegot. The supply chain dynamic
with the market gettingflooding, with clients wanting
to build, and a really hotmarket and a ton of
(35:06):
appreciation, right? There's alot of builders in 2020 that ran
out there and thought that theywere the best business people in
the world because they coulddouble, triple their top line
revenue in 1218, months, right?
So I think, like, kind of thatperfect storm comes back into
this huge emphasis being placedon, okay, I've seen it all
right? I've you've got thebusiness owner that started in
early 2000s or 2008 and theyweathered the storm, and they
(35:30):
built something that wasconsistent, and they're making
money and building families andemploying people and impacting
community. And they saw a dip,and then they saw an explosion,
and then you start to get thesepeople that pull back. I think
the market is ripe and trulybegging for an easier way to
understand their businessthrough the lens of a business.
Am I making? What I should bemaking on these projects? I
(35:52):
think from a technologystandpoint, it's a super
interesting time to be inconstruction, because a you've
got a huge new wave, newgeneration wave coming into the
sector. Much more techinterested, tech forward, um,
and I think they, a lot of them.
(36:13):
I mean, as you know,construction is a generational
type business, right? Daughterbuying the business from mom,
dad, brothers, whoever right,and I think they saw those
trials and turbul, tribulation,tribulations, not tribulations,
turbulence. There wasturbulence. But they see those
situations, and they want tocome at it through a little bit
(36:33):
more strategic lens. And theopportunity that poses for
technology is to providelegitimate, automated,
compelling solution, not justwhat was typically bloating the
market. From an optionstandpoint, historically,
there's a ton of ton of productsentering the space. I think I
was talking to Nick Schiffer atthe contractor coalition Summit,
(36:54):
and he was saying there was like200 new software products or
something at the Internationalbuilder show, and it's like it's
just exploding, right? And Ithink again, you don't, you
don't stand up a software youdon't raise a ton of money, you
don't take a huge personalfinancial risk to build a
product, if everything was sogreat that was already being
(37:16):
presented, right? So I think,like, my answer long winded,
albeit, is kind of anaccumulation of all those
things. If you're a generalcontractor looking to scale your
construction business and you'reserious about treating it like a
business, then this one's foryou. The contractor coalition
Summit is a four day all in nobullshit experience, hosted by
(37:38):
Brad Levitt from aft andPhoenix, Nick Schiffer from NS
builders up in Boston,Massachusetts, also the co host
of the modern craftsman podcast.
Tyler grace from TRG homeconcepts, also a co host of the
modern craftsman podcast. Morganmolotar from construction to
style. And Mark Williams fromMark D Williams custom homes,
and the host of the curiousbuilder podcast. Now I give you
(37:59):
all that context because I wantto highlight that these are real
builders, sharing what actuallyworks, and they are massively
motivated to help the industrybetter as a whole. In this
event, you'll learn everythingfrom AIA documents, cost plus
contracts, org charts, brandpartnerships, how to position
(38:20):
your business to be as healthyas it possibly can, and when as
much work as Re is reasonablenow there will be high impact
strategy, real talk, great food,even better. People in
attendance, and if you want adiscount, hit me up at Reese at
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we've got a promo code. Thepromo code is adaptive 25 for a
(38:43):
20% discount. Space is limited.
Get in while you can. We'll seeyou in Chicago.
Yeah, no, I love that historylesson that was, I think you
said that really, really nicely,and it's a good way to sort of
think of the snapshot. And I'msure you just took some builders
back through, back through timeof their prior years too. I
(39:04):
think the only other thing Iwould say that is, one thing
that I see that is is reallycool, is whether it's the new
generation or people who havebeen doing this for for, you
know, decades. Is the way thatother technology they see, even
just in their personal life,gives them that aha moment of,
hmm, there must be a better wayto do this in my business. Like,
(39:28):
you know, whether it's theirtheir own personal banking apps,
I've had clients say that to mebefore, like when I'm in my
banking app, or when I'm doingmy my family's finances, I can
do this or that. I want to beable to do that in my business,
to which I respond, we candefinitely do that in your
business, and that's cool tosee. Then, what I've seen is
business owners starting to sortof bring those ideas from
(39:49):
totally unrelated areas of theirlife and look at their business
through that opportunity, whichis exciting, totally,
totally, I think, I thinkthere's just like generally,
there's just a lot more intenthappening. Me into construction
right now. And even, like, it'snot even just like the new wave,
that's certainly a biginfluence. You know, you get,
you get a lot of younger people,more tech forward. I mean,
(40:09):
they're hearing AI, they'recurious and how they apply it to
their business. But I'm serious.
I mean, we've, we've gotcustomers that are 6070, years
old. They've been in thebusiness for 50 years, and
they're even seeing it. They'relike, this is ridiculous. This
has always just been status quo.
It's always been it's a goodenough process. There's options
(40:33):
out here to make it better, andthey'll adopt very quickly, very
quickly. The problem resonateswith them. When you talk to
them, they say, who likestracking receipts? Yeah, like,
that's a no brainer, right? It'slike, the shoebox method. It's
like, okay, it's working, but itwhen you really break it down,
it's like, what is the time ittakes to process a receipt? And
(40:53):
you look at the dollar amount onthe receipt, and it's important
to track every dollar, butyou're like, it cost me more to
process and track this receiptthan it was actually worth,
right? That's when you start tolike, see those guys start
scratching their head. They'relike, let's talk. Yeah, yeah.
I love it. Anything else thatyou think is tactical that you
(41:15):
could share with builders, Ithought this was great from a
forensic standpoint, how to viewyour business, but anything else
tactical that you would want toleave the listeners with?
Yeah, I think something that'sbeen very top of mind for me
recently, that we didn'tdiscuss, that it definitely is
an aspect, a huge aspect, ofadaptive and and I think a
(41:36):
problem that I don't necessarilyget to with my clients until we
sort of put the fires out, istheir AR cycle, which, for those
listening, is how fast you aremaking that turnaround on
creating an invoice, and thenhow quickly your client pays
that invoice. I don't thinkenough owners are really
thinking about that and also howthat feeds into bill pay and the
(42:00):
timing of how long does it takemy client to pay me? When am I
paying my vendor and how long amI just out that cash? So I don't
necessarily have tips there, butit's definitely something I'm
thinking about a lot, andencouraging all of our clients
to also think about more and seehow we can tighten up that part
of the financials. Totally.
(42:21):
I love that you brought that up.
Happenstance, another builder.
It was, he was actually out ofAustin. Same conversation, he's
in there. He's like, I'm gettingready to do this big project at
the development dozens of units.
He was like, I used to be ableto float AP at a much smaller
level of business floating APfor the listeners is you get 15,
(42:42):
$20,000 in invoices. You canbasically carry that as the
lender to get your subs paid,waiting for you to receive the
money into your business tocover those costs.
Yes, it's basically lendingyourself, lending yourself
money. Essentiallyyou're a banker, not a builder
at that point, right? And pointbeing is the conversation. There
(43:04):
was, he was like, we've got tofigure out how to speed this up.
And like, the immediate side ofthat was, was like, quicker
payments to the subs. But thenthere was, like, it takes us a
week to get our draws together,and then it takes so the bank 10
days, and sometimes they gottasend someone out to inspect it,
and then we've gotta get themoney to the subs. And like,
(43:26):
you're looking at like, it'salmost like a 20 business day
process, and you're like, thisis absolutely insane. And that's
where it's like, it's more aboutthat immediacy and
understanding. It's like, okay,here's all of my costs that I
have coming in the pipeline, Ican see a real time view of what
my cash flow position actuallyis and what projects I need to
be collecting from, and then howquickly can I get that invoice
(43:48):
out to the customer or to thebank so that then they can fund
confidently the cash that Ineeded to pay the cost that I
have coming down the pipeline?
Yeah, and then it's when youthere's the the worst case
scenario where someone is 234,months behind on invoicing their
clients at all. And that's like,it hurts my heart because they
(44:11):
there are, they're funding theirclients projects. And then when
you get caught up, and we're inthis great place, okay, now
we're invoicing every singlemonth at the exact same time,
awesome. Then becomes this fungame of like, how can we get
that tighter and tighter andtighter so that you as the
business owner are holding ontoyour cash for as long as
possible, which you can thenleverage in a variety of ways?
(44:33):
So totally, no, I think that'sgreat. I think that's like, the
general theme wrapped up nicelyin this conversation is like,
you really can't get to thatpoint until you've made a lot of
the checkpoints that we hadtalked about right accounting
operations. Chloe Brown,everybody you talked about not
wanting to plug yourself. Butlet's just end on, like a little
(44:54):
plug for wildest dreams, howthey can get in touch with you
where this process typicallystarts. What sweetest? Services
do you typically provide?
Yeah, you can find me at Chloe,C, H, l, o, e, at think
wildest.com Our website is,think wildest.com and I truly I
mean this so much. I lovetalking to business owners, and
(45:18):
I would be happy to usually,I'll schedule a 30 minute call.
We go an hour and I I just enjoyhaving those conversations, and
even if we don't end up workingtogether, just being able to
shed some light. I do thisbecause I love supporting small
business owners that are feedingtheir families and feeding their
team's families, and I'm superpassionate about helping those
(45:41):
business owners be moresuccessful. So I would love to
chat.
Love it. Love it. I think that'sgreat. And I think even just
like to the early remark of thesales consulting pro bono that
you provided, it's all aboutlearning about the problem.
Right to Chloe's point, sheloves having conversations with
builders, understanding theproblems and situations you guys
are in. She has, she's, we've,literally, we've had her bring
(46:02):
us customers. We've sent hercustomers for the last two,
three years, and they all havegreat experiences. Um, so hit
Chloe up if you're wanting to dothese deep dives and just get a
little bit better financialpulse on your business. But, um,
Chloe, this was great. Youcrushed your first Was this your
first podcast? This is yourfirst podcast.
I don't think it's like my firstfirst, but it's Yeah, first,
(46:23):
maybe in a long time, it's I'mnot, I don't think I was born
for the stage. So youwere great. You were great.
Yeah, you were nervous aboutdoing this. You you absolutely
crushed. This was awesome. Itwas a good conversation. I love
that you asked me questions.
Normally, I'm the one justasking questions. This was good.
It was a good dialog.
Good. Well, that's what, yeah, Ithink with like, the sales
process, especially, I alwayssay I'm terrible at sales, but I
(46:44):
make a lot of sales because I'mgenuinely, like, very curious.
And I think that's like, justthe way like to sell, because if
you're genuinely curious, youhave a stimulating conversation
with the person about the thingsthey care about. And so I'm glad
that that came across a littlebit. You
did great. You did great. Well,I'll let you get back to it and
(47:06):
wait. Are you gonna be in someyou're not gonna be a sun Bell.
No, I'm going to thatconstruction accounting, or
accounting with Hector Garcia.
It's like a small, small groupdoing, like a technology and
construction Think Tank thing.
So I will, I will talk aboutadaptive, I'm sure, yeah, yeah,
well, whatever. Well, enjoy, andI guess, yeah, we'll, we'll see
(47:27):
you when we see you. Okay, thankyou so much. Appreciate you.
Typically, what we find isanywhere from 1000s of dollars,
(00:03):
10s of 1000s, hundreds of 1000sof dollars on any given job that
was spent but not recouped.
I am so glad that you're onbecause I think you have a very
(00:24):
unique and a very valuableperspective, specifically,
obviously around, like,construction, accounting and
operations. Obviously, you'vebeen a partner of ours forever.
So I say we just talk about,like, what you're seeing in the
market, generally, that buildersstruggle with.
We can do some of like, theeasy, like basic fundamentals
that they need to have in place,but even talk about some of the
(00:47):
more strategic things thatyou're seeing the best builders
do. So that's what a lot of thisthreat will be. But for the
listeners, who is Chloe Brown?
Chloe Brown, well, I think it'sfun to say how we met, which
was, I was walking around aconstruction Conference, which
for any, any builders, any anypartners who have ever walked
(01:08):
around one of those. I don'tknow if you're like me, but
you're, you're pretty muchdodging every booth that's
trying to reel you in. And I'mlike a professional dodger. I'm
very good at that. And when Iwalked by adaptive, I could not
dodge you read like you pulledme in. So good. And we've been
Yeah, friends and peers sincethen.
(01:28):
Yes, I am a, I am a professionalattention getter. And okay, but
actually, what was it thatpulled you in? What's the
difference there? Pump my tiresa little bit. What worked? Well,
you I remember that you werejust, you were asking really
good questions, and it's a lotharder to just walk past someone
when they're asking really goodquestions than somebody who's
(01:49):
just kind of trying to pitch youthe product right away. So,
yeah, yeah, I guess we'll notthat. I'm a Sales Consultant,
but we can just slide a littlesales tip in there.
Yeah, exactly. Well, that's whatit's all about, right? It's
like, it's really hard to solvesomeone's problem if you don't
know what their problem is,right? So no, that's great,
yeah. And it's honestly, I thinkyou were using what air table
(02:11):
and like, kind of amalgamationof other tools and stuff like
that.
Yes, good memory. We were doingcustom solutions through air
table and some other lightweighttools. So I guess, introduce
myself. I'm not a salesconsultant. I am the founder of
wildest dreams where we reallyour core focus is helping
construction companies make moremoney on their jobs. That's
(02:33):
where we start with companies,because we really believe that
if your core product isn'tmaking money, if the financials
of that core product don't makesense then, like, it doesn't
really make sense to look atlike, can we grow the business,
or can we create leveragesomewhere so and the way that we
do that is through one, verymeticulous, job level, Job
(02:56):
Costing, job level financials,and two, through leveraging the
best kind of cutting edgetechnologies that the
construction industry has tooffer. So
totally I love it, and that's Iso I think, just like over the
years, because I've just beendoing this for almost 10 years
now, of talking to builders,processes, Business Solutions,
technology, you obviously, youtalk to people that impact you,
(03:20):
and you hear, you know, commentsthat they make and takeaways,
and I probably got it from youor less, we're just organically
that aligned. But point beingis, why in the hell would you
try and scale something if youdon't know it's making money,
right? Or even not even justmaking money, but you're making
what it should be making, right?
It's like any other widget. It'dbe insane for Apple to be
scaling iPhone building if theydidn't know they were going to
(03:43):
be netting X on each unit,right? So I think that
transferability into homebuilding is is easier said than
done, just considering all thenuance with an 18 month product
that you're building, right, ora 12 month, six month product
you're building, but also justwith the craziness and invoicing
and accounts payable,receivable, stuff like that. So
I probably got it from youbecause I pitched the same
(04:05):
thing. It's like, what? Why? Whyare we trying to, like, take on
more units when we don't knowwhat we're making
on our current units? Yeah,well, and an idea that's
definitely not new. And I think,you know, every anybody in
accounting and construction saysthis and beyond, I'm sure is a
lot of business owners will say,Well, I have money in my bank
account, and that's kind oftheir litmus test. So, so I must
(04:26):
be able to hire, so I must beable to grow. But what they
might not be thinking about ismaybe some of that money is a
customer deposit for a jobstarting in three months, or
maybe that's sales tax moneythat you need to pay out, or
business tax. There's so muchthat's wrapped up in that bank
account number that doesn'tactually tell you really
anything about whether or notthe business is performing well,
(04:46):
totally100% well. And so let's, like,
kind of thread into that. And Iam curious, from like, maybe a
more rudimentary standpoint, isthere's a lot of tech out there.
You guys are building customsolutions, leveraging,
leveraging products like air.
Airtable and other products.
What was the big like aha momentfor you to move off of building
those more custom solutions, airtable centric processes into
(05:09):
something like adaptive?
Yeah, so I will say we stillleverage those tools
extensively. So I My backgroundis in startup tech, my sort of
ethos that I'm that I'm bringingto our clients, is use the best
tools for the job that you needto get done, just like they
would do on the job site. So ifthere is a, you know, vendor,
(05:32):
documentation, compliance toolthere, which there are many out
there, if they're not hittingthe mark, we're going to still
kind of use our tools and do itthe way that we think is best
when, in terms of an aha momentor making the switch, is when
you do find that product that'sdoing not only what you had
custom built, but But 10 timesbetter than what you can do,
which you know not to make thisdo sales pitchy for adaptive,
(05:55):
but I mean definitely the case.
Adaptive does what we couldnever build, kind of custom in a
solution of ours so, and I thinkpart of that is integration with
your accounting software,integration with the general
ledger, and it's hard, it ishard to maintain the systems
that we build kind of in housefor clients. So it takes a
little more legwork.
(06:19):
Totally, totally Well, and,yeah, certainly not to keep this
as like a sales pitch, but I do,I think this is going to be like
a good segue into large like.
I'm wanting to, like, really getsome more context to the blog
that you did with us on I thinkit was like, you uncovered like,
5 million and unbilled costs.
And I think this would be a goodsegue so we don't have to worry
about this being like a salespitch for adaptive but for like,
(06:42):
the specifics you'd mentioned,like, integration, but like, was
there anything else that, like,really stood out to you? You
mentioned vendor compliancedocs, which we obviously do, I
don't know if you're using themwith your clients, but like,
what were some of the big piecesthat you could, like, even
advise builders to look at whenthey are evaluating tools, or
even looking at AdaptiveYeah, I think I mean being able
to really see the link betweenyour expenses and your draws and
(07:04):
and covering all of your tracks,knowing, if you're curious, oh,
shoot, did I bill out? You knowthat vendor charge? You can look
in your you can look at thatexpense specifically, and see
right there in the expense whatdraw it's tied to, plus all of
the reporting that you guysexecute too, through draws. I
mean, I think I could go on andon, but I off the top of my
(07:25):
head, those are a couple thingscoming to mind. Is just being
able to, sort of like, followthe thread of the expense to the
draw, which is so important fora builder. And then maybe the
second is the way that that allfeeds into the job budgets page,
so you know, you have thequestion about that expense, and
now you can compare it to yourbudget and see if that cost
code, so talking not even justabout job performance, but like
(07:51):
cost code level performancewithin that job
totally well. And I think that'sgreat, because, I mean, that's
really, I think when people lookat adaptive, or maybe even hear
about it is like, I think it'sreally easy for them to glom
onto, like, this time savingidea, which it does for sure.
But I think, like, what you'reoutlining is the more valuable
(08:11):
ROI, which is MIT, like,preventing those misses from
happening. It's a cash flowmanagement tool. It's a
financial operations tool,right? It highlights those big
misses that builders comeacross. I was just talking to
another builder out of StGeorge, Ron Jensen. Shout out,
Ron. We'll probably have him onthe podcast here soon. But point
(08:33):
being is, I was just like,talking to Ron organically,
naturally. And he was like, justtotally off the cuff, and he was
pitched on time savings when hebought and he's like, Reese,
we're actually seeing like, anuptick in profitability, because
there is not a single receiptthat leaves this business or
comes into this business thatisn't properly categorized,
(08:53):
right, that isn't late. We'reclosing books out on time. We're
making sure that we're hittingour profitability. We're making
sure that we have the income tocover those expenses and those
costs, right? So it's beautiful.
Yeah, go ahead. Oh, I was justgonna say, I think when you talk
about time saving versus value,I think any construction or like
skill, someone that started withskilled trade can appreciate
this comparison is you shouldn'treally get interested in doing
(09:17):
something faster until you'redoing it really, really well. So
we need to make sure we're doingsomething really, really well.
And then it's a it becomes aboutspeed.
Totally. What are some of thethings that you see builders
trying to do really fast, maybenot as much like an umbrella,
but like tactical that you seethat just like bites them, that
(09:37):
you're you and your team mightcome in and correct,
yeah, I think, I guess, to riffoff of Ron, who I also know. So
shout out to him. You know, Ron?
Love it. Love it. It is the job.
Job level financial coding, likethe job costing, where it's
like, okay, well, we'll just putthis in this job code, because I
don't remember, or I went toHome Depot. I don't even know
(09:59):
what job that. For. So let meforget about that. And our ethos
is really like, let's let'strack every dollar. Let's track
every dollar you're spending.
Because if you know it's like,the way you do one thing is the
way you do everything. So ifyou're really loose about this
receipt, your team is going tosee that. They're going to be
loose about theirs. And then itjust all starts to fall apart
from there. And I think that'swhere dollars become 10s of
(10:21):
dollars or hundreds or 1000s ofdollars on a given
job totally well. And so I lovethat point of like, how you do
anything is how you doeverything. Like, so when you're
working with your customers, isthis like coaching them on how
to do it? Is it largely likecreating a process for them to
(10:43):
follow? What would you say youspend most of your time doing to
prevent those types of well,just throw it here, and we'll
deal with it later. Type, yeah,that's a good question. And
something we as a business haveevolved on a bit ourselves in in
the beginning, which is stillwhat we do, is we come in, we
assess just what are the currentoperations? We will do a process
flow, you know, map out everysingle step. I think that's, I
(11:05):
like to think that's somethingthat makes us different. Maybe
some from other firms peoplewill work with is that
operational piece. So, like, howdoes the guy get from the gas
station without the receipt backto the office? Like, all of
those details. And then we lookfor opportunities to really
optimize for the sake of dataand making sure that data gets
where it's going. So we do sortof that as maybe more like
(11:26):
process strategic consultingside. And then in some cases, if
there's a really sophisticated,you know, office manager or
somebody in the office, then wecan kind of train and implement
on some of the processes thatwe've seen create a lot of
success, but we have begun moreand more actually offering
monthly recurring accountingservices for our clients to then
(11:49):
support execution on thosebetter processes. And we have
found more success when we kindof like, stay involved on a
monthly basis.
Totally, totally. That makes aton of sense well. And like,
even, even when you've got,really, what I'm picking down
you mentioned, like, asophisticated office manager,
and also, like, providing theseservices, like, I think it
(12:10):
really has to do with, like,ownership and accuracy and like,
what's getting done. And I thinkthat's a good segue into, like,
I'm just dying, and here we are,like, 12 minutes, and I'm just
dying to know the details andlike, actually hear the story on
the builder that you ran thecase study with. You do not have
to share names, entities,anything like that. Like, I
(12:30):
would love to know how you metthem, what was their state when
you started working with them,getting to a point of
realization of what needs done.
Right? Execute, like, what wasthe story?
Yeah. So I think we can do this,like, you know, one of those
based on a true story, whereit's like, this is an
amalgamation of severaldifferent characters. Because
(12:50):
the reality is, this is the casewith every single client that
comes to us. That blog or casestudy was maybe the biggest,
sexiest number. Yeah, it's, it'sit's like that with every one of
our clients. And typically, thesort of like story that happens
is we start engaging with abuilder or GC. They know
something is falling through thecracks. They know they're not
(13:11):
making as much money on the jobas they should be. And when we
start digging into theoperations of, okay, well, how
are you tracking these things?
They're either tracking them inspreadsheets, or maybe
handwritten in some cases, orit's like three or four
different people that are allmanaging the data, trying to get
it into one place. All that tosay that when they really look
(13:32):
into it, they actually don'tknow where all of the
transactions are happening. Ifthey're doing cost plus they
they're pretty it's pretty clearthat they are not recouping for
all of those transactions. Sosure when, when we assess that
and we figure that out, we divein a little bit deeper, and
we've with the help of adaptivewhich has made made this process
(13:54):
significantly more efficient andmore accurate for us. We also
have kind of an in house systemthat we've developed to do a
very meticulous, detailedproject audit, where we
essentially, it's almost like aforensic job analysis, where we
go back through the whole lifeof the job, and we re we piece
together every transaction andevery draw and make sure that,
(14:16):
well, make sure and find all ofthe transactions that have not
been billed back to the client.
So in that process, typically,what we find is anywhere from
1000s of dollars, 10s of 1000s,hundreds of 1000s of dollars on
any given job that was spent butnot recouped. And for any
(14:39):
builder out there who is hearingthis and thinking, Oh, well, I
you know, that would neverhappen. I would never miss out
on hundreds of 1000s of dollarsof transactions on one job,
which was how we got to the 5million with that one client,
their high end custom homebuilder, several really big
jobs. And that is, that is wherewe got at the end of doing
project audits across. All theirjobs. Anyone listening that
(15:02):
thinks that that isn't happeningto them? I will. I would love to
take a look at your books,because I have not worked with
any anybody yet, from verysophisticated to, you know, our
more kind of, I'll say, like ajunior level owners who, who
doesn't have that problem.
I think that's like, what Ithink is super powerful, because
(15:29):
we see the same thing. And,like, it could be like, are we
just, like, building this echochamber? Is this problem, like,
actually that rampant in theindustry, right? You see it? And
I think that the conversation isless about hundreds of 1000s of
dollars, no way, or hundreds ofdollars. Who cares? Right?
Right? It goes back to thatconcept of, what are we trying
to scale if we don't know whatwe're scaling, right? It's like
(15:52):
it has nothing to do with are wemaking money. It has everything
to do with, are we making themoney that we should be and if
we have these opportunities,project over project, year over
year, that we're not capturingincome on. We're not getting the
money that we should be doing.
We're monetizing a hobby less,running a business
totally. And I love the way yousaid that, too, because even if
(16:15):
it is the guy that or thebusiness owner that's saying,
well, if it's a couple $100 hereor there, who cares? The
question back is, okay, how muchrevenue are you doing this year?
Oh, a million. Okay, what if inthree years, you're doing 5
million now? How many now? Wheredoes that $100 kind of land if
you're using those sameoperations, it that is scaling
your your success compounds andyour issues compound as well.
(16:39):
Totally fix, fix those issues,totally so for you mentioned
cost plus, I guess when you'rewhen you're looking at these
builders, and you're pullingback, you know, the curtain
really doing a deep dive, I dowant to touch on the forensic
side of things, maybe even,like, a little more tactical,
how are much willing to share ofthat process you actually get
(16:59):
into. But when it comes to thesebuilders, cost plus is like, I
think kind of the the posterchild for it, because they're
billing their customer directlyfor cost, with a markup,
including their margin, right?
But are you seeing, like, eventhis cash leakage or profit
erosion happening with fixedprice builders too? And what
does that look like for them?
Yeah,totally. So I think in the first
couple years that we wereworking, even with adaptive, you
(17:22):
guys even were like, well, we'rereally, you know, for cost plus,
not fixed price. And we weren'tworking too much at that time
with fixed price. And sincethen, we actually just did a
huge cleanup and onboarding withan owner who owns several
different construction companiesall fixed price billing, and
what I realized I was makingthat mistake early on. And I
(17:43):
think you guys were too to thinkthat there was no value, because
even if it's fixed price, theyhave to be coming up with that
price from somewhere. And ifthey can't look at their
historical jobs and get a reallyaccurate hold on how much did we
spend and how much did we make,it's the same problem is a cost
plus builder, like the data theyneed is the same. So, yeah, so
(18:03):
we just did a big implementationfor multi entity builder, and I
know he's thrilled because hewas tracking in spreadsheets. It
just lacked that accuracy thatnow he will have on the job to
moving forward so he can say,okay, you know, I thought I was
going to make 30% markup on thisjob, but it looks like it was 25
(18:24):
and how do we tweak ourestimates?
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(18:44):
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(19:06):
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(19:31):
Build better. Okay, so you'refinding for the fixed price
builders, big entity guy, he'ssuper stoked, I guess when it
comes to like, the differencehere, and you're talking about
the historic side, how I pitchedthis to builders is whether
you're if you're cost, plus youcan't, plus what you don't cost
(19:51):
if you're fixed price, it's arace to margin. You had
mentioned. It's more of like ahistorical benefit to know,
like, how are we actually doingon these jobs? Jobs. But do you
see any of these concepts inthis profit erosion happening in
real time for fixed pricebuilders during their jobs?
Yeah, definitelymean, because they're always
bidding that next job. So whenwe start putting those
financials together on a jobwhere it's fixed bid, the
(20:13):
contract is signed. No matterwhat we show them they're
spending. They are where theyare on their revenue. You know,
they're, they're continuing toput together estimates. So when
I say historical, you know, it'shistorical, but it is in real
time, because they can correctas they go. They don't have to
wait, you know, months or evenyears to sit down and look at
(20:33):
their data. They can just pullup the job budget right away and
see, oh, shoot. These last threejobs I bid are underperforming
by 5% I probably should bumpthis. This bid up 5%
Yeah, totally. Do you see itbeing more of an aggregate bump
for them? Are you a part ofthese conversations, like when
(20:54):
they're actually biddingtheir jobs? We don't get too
involved in the estimate sidefor us, it's more of a
conversation around because, Imean, we're not construction
experts, and we in terms ofdelivery, and we don't, you
know, claim to be sure, but weare able to make these, see
these kind of, like, trends,historical trends, and and
provide some guidance there,like exactly what I just said,
(21:15):
Hey, the last three jobs thatyou started, you're, you know,
25% of The way in, and this ishow it's trending. Let's talk
like, whatever you're biddingyou might want to think about
that totally, totally.
And I was just curious, becauseI like, I imagine it's more of
like, from a line item by lineitem basis, of like, when you're
going through and you're doingthese post mortems on jobs, and
(21:35):
you're like, there was a 5%bleed on this, and it was
largely because of these threelines, we need to take this in
consideration on a future job orwhatever.
Yeah, definitely. And we look, Imean, we've talked a lot about
just looking at the job budget,where we look at a range of
different data sets, we look atthat variance by vendor. So
which, which vendors did youthink were going to come out at
(21:56):
x that came out at Y? We look atthe cost code level to see, is
there just a consistent costcode problem? Is there, you
know, a certain like link tothat, whether it's a particular
project manager or team member,maybe it's a group of jobs
managed by a certain team. So welook at the data in all
different ways, not, not justright at face value,
(22:19):
totally. I You mentioned thecost code thing, and that's wild
to me, that it's still aconversation like truly again,
it could be like an echo chamberthing, right? Like I'm talking
to builders. Cost Codes arenormal, but when you get into,
like, the sales side ofadaptive, and us talking to
builders that are interestedenough to take a call or see a
(22:39):
demo, or they heard about us, sothey want to come in, you start
to peel the layer back. Like,how big of a problem do you
think cost code structures arefor builders?
Well, I mean, you're kind ofsaying it what you're you're
just as much. I mean, youprobably talk to more than I do.
Like, what do you what? Whattrend are you seeing is, is it
that there's too many is thatthat they don't know? How do you
like? What is the problem yousee,
(23:01):
I love that you're shooting thisback to me. I truly, I love it.
Um, my perspective is, is, Ithink there's just like a true
gap in understanding theintention of cost codes. Agree,
I don't think that. I think theyknow what they are, but I don't
think they understand how theyshould be leveraged in the value
that they can pose at abusiness. And I say that
(23:24):
primarily there's there's onebuilder that comes to mind, and
they're like, we can't everstick to a set of cost codes,
because the owner always likesto add new cost codes. And it's
like, if that owner understoodthe intent of cost codes, they
wouldn't be adding cost codes,right, right? They would
understand that it's like, it'sabout consistency and building a
(23:48):
framework to where you canactually track your costs
consistently, month over month,year over year, yeah, and
understand the health of thebusiness. What's your take?
Yeah, no. I think that was wellsaid, and it's Yeah, because
every time you add a cost code,that new bucket has nothing to
back it up for, you know, untilyou build up all of the data
behind it. So I push back. Idon't, I wouldn't necessarily
(24:11):
say there's never a reason toadd. I think there are
situations where, for you know,there might be, like a bank
lending situation, wheresometimes the bank actually
requires certain line items tobe broken out of certain so
there are situations. I thinkeverything you just said, I
fully back up. I think what Iwould add on to that, that I see
that drives me crazy, it'sthere's something about the
(24:36):
industry that can be a littlebit of, like a little bit of
high school, where it's like,well, this person's doing this,
so maybe I need to do that. AndI that with cost codes, where
it's like, well, so and so. Andthis build, builder group, elite
builder group, I won't name, isusing these, you know. And so
what we do with builders a lot,there's certain things that can
be templatized, but there areother things where we really
(24:58):
need to talk about, how doesyour. Business operate. How does
your team think about thesetransactions, and how do you bid
the project? And let's make surethat the cost codes really fit
your job, rather than havinglike, 500 Cost Codes. That's a
list that you got offline or gotfrom a up here. Totally Yeah,
because then they implementthose and they don't understand
(25:20):
them, and then they don't usethem properly,
exactly, exactly, and that'swhere it even goes back to like,
the wrong story of like, like,you've got, you've got to
commit, right? I think you'vegot to commit. You've got to
know what you're committing to.
And if you can, that's whenyou're going to start to see
those benefits come through.
Definitely. Yeah, yeah. I have aclient we've worked with for a
(25:40):
really long time, who is veryself made, and his cost codes
are don't look like anybodyelse's. I'll put it that way.
And I think sometimes he hasthat sort of like imposter
syndrome, where he thinks theyshould be fancier or better or
have bigger words in them, andwe just his financials are
really strong, and we just talkabout how they're working for
him, and why they're working andfor their team, and that there
(26:03):
really is no need to changethem. Nobody's looking at them
besides us, right?
So, dude, I love it. I love it.
I am curious on you mentionedthe forensic side early on, and
I've heard this from several ofour partners, how they'll
leverage adaptive to justuncover these types of
nightmares, but also, like beable to execute on a forensic
(26:25):
deep dive much more quickly andthoroughly. What are how are you
leveraging adaptive for that?
Or, I guess, how do you run thatforensic side? And again, if
you've got the secret sauce, youdon't have to share everything,
but I'm curious, like, what youguys do there?
(26:45):
No, it's funny when you saidthat earlier, about, like, not
uncovering secrets, I'm I'mlike, I'm happy to to show
anybody what we do, because itis freaking hard, like, it's,
it's not easy, it's a lot ofwork, and it's a process that we
learn and we perfect every timethat we do it. So I welcome
anybody to to attempt this aswell, because I think it's very
(27:07):
specialty that we're evenwilling to do it. But so I think
I mentioned earlier. I mean,basically we are, it's like
forensic in the sense that we'relike rebuilding the whole crime
scene piece by piece and tryingto figure out where everything
goes. We have to work a lot withthe builder, obviously, to do
that, where adaptive comes intoplay is if they've already been
(27:28):
using it amazing. It gives us aton of visibility if they
haven't been using adaptivewhere it's really helpful, which
I don't know that this issomething you end up talking
about a lot with adaptive, butit's it's probably so overlooked
is the UI and the interface ofworking in adaptive supersedes
(27:48):
QuickBooks by a lot. So it maybe that there is a lot of this
work we could do in QuickBooks,but it would, and this is where
we get into time savings, itwould take us a lot longer and
it would just be a lot morepainful. So all of like the
filtering views, bulk editing oftransactions, being able to look
(28:09):
at transactions in differentreporting styles by really any
variable we want to look at,that helps us to do this
extremely tedious work. Doesthat answer your question? I
don't know if I like processnecessarily explain the process,
but no,this is, this is perfect,
because that's like, even how Iexplain it, like, there I will
there. You know, there'scertain, like, certain builders
(28:30):
that you never forget, um,especially like being in sales,
right? Like the experience of,like, you know, them starting
the conversation and thenstarting to see the light in the
conversation, and then gettinginto the product, right? And
then there might be, like, somefriction, or some like, oh shit
moments for him, right? Therewas one builder. It was in the
early days. This was like,probably, like, May of 2023, and
(28:54):
they were using another productthat was synced to QuickBooks,
and they were, like, skepticalof adaptive. They're like, we
think we're getting this done,but like, we're com, it's
compelling enough for us to try,like, we'll get into adaptive.
And they'd sync their QuickBooksto adaptive, and they like,
immediately shot back. Like,your product is trash. It's
showing our books are total, atotal mess. Like, there's no
(29:17):
like, how is it even suggestingthis stuff? And we're like,
obviously, six months into go tomarket, like, digging into it,
right? And we're like, let'slook at your quickbooks file,
and then we start to uncoverit's like, no, you actually do
have hundreds of bills that arestill open from 2017 Right?
Like, you do have dozens ofbills that hadn't been synced
(29:43):
properly with jobs, right? Andthen that was like, they're
still customers of ours today.
Like that was the like, you'rethe immediate enemy to the
you're the Savior that quickly.
And I think it goes into that,like, just my question
originally to was a forensicprocess, look like? You aced it
with the simple UI, right, andthe thoughtfulness of the
product, but it literally, forthis guy, was syncing QuickBooks
(30:05):
to adaptive and like gettingthis, like overwhelmed moment of
I've got a lot of stuff that'swrong in QuickBooks, and because
QuickBooks is so difficult tounderstand, and so few people at
an organization actuallyunderstand it to a level of it
being helpful. It creates thisdynamic where, like, business
(30:25):
owners will stick their head inthe sand saying, this is this
person's role. Everything'sgood. Did we make money this
year? Yes, good. On to the next.
Meanwhile, they've got thesecompounding issues that we've
already talked about in thebeginning of this episode that
are just like just hovering overthem until they get addressed
totally and you just nailed it.
It's like you said that sobeautifully. Is like they make
(30:47):
it one person's job because theyknow that diving into
QuickBooks, they can't evenbegin to wrap their minds around
that, which I totallyunderstand. And then the fact, I
mean, that's that's a ROI foryou right there on using
adaptive or a tool like it is,you plug it in, and in five
minutes, you can suddenly seeall of these things that we're
hiding in your QuickBooks thatyou never would have really been
(31:07):
able to see yourself and alsomaybe identify that this poor
person that you have made it tobe their job, perhaps that's not
fair to them and that theyreally need more support,
because I've had owners in thatsituation in the past, and
they'll kind of respond and I'llexplain the process of cleaning
up their QuickBooks so thatadaptive is accurate, they can
(31:31):
see the data, etc. And then theymight get overwhelmed and say,
Oh, well, whatever. Like, we'remaking money, it's fine. And
then if the explanation of,okay, well, that's your general
ledger. That's like, literally,the kidneys of your business, if
that's not correct, taxes,aren't, you know, and on and on.
So,yeah, totally, totally, no. And
I think that kind of to thepoint of the individuals. I
(31:53):
mean, there's, like, there'scertainly a lot of pride that
comes with the money side of anybusiness, right? Accounting,
Finance, bookkeeping,controlling stuff like that.
Rightfully so. There should bepride that maybe, maybe pride
motivated by fear, right? Andthey want that control over the
(32:13):
process. And it's kind of like alose, lose situation for them,
and in a manual world because ofthe reality of the volume. And
not even, like just the volumeand the quantity of the
invoices, receipts, A, P, A, R,it's the volume and the zeros
(32:35):
that come on these transactions,building these huge projects,
right? And it's like, if there'sjust a single, simple error, it
could be you hit the decimalinstead of the extra zero, and
it's throwing everything off,and it's impossible to go back
and find so again, I think, likewhen you're talking about this a
(32:55):
it's like, it's worth it, justto understand the the the the
health snapshot of your books.
But also, again, it'sleveraging, to your point of
what, while the stream is doingis like, leading, leveraging
leading edge technology toassist the process.
Yeah, yeah. I think it'stechnology. And it's also
(33:16):
finding, like, not to promote,but find, and truly finding the
right people to help you dothat, not not putting the weight
of your business, the financialburden of your business, on your
office manager, or, in somecases, it's people's moms or
brothers. It's it's unfair tothose people. It's unfair to you
as the owner. And there arepeople out there that are doing
(33:38):
this very well, that can helpyou. And I am, I think, with
what we're talking about, we're,like, ragging a little bit on
the business owner. That's, youknow, doing these things. But I
am seeing, in the years I'vebeen doing this a shift, like
there is a new wave happening, Ithink, in the industry, and a
turnover, case in point, thesuccess of adaptive, or the
success of wildest dreams. AndI'm curious, because you've been
(34:00):
doing this for a while too, evenbefore adaptive being with prior
construction software companies.
Like, what, what are you seeingas the change, like, in what
we're talking about? Like, doyou feel like the clouds are
parting?
Yeah. So I think so. My answeris largely gonna be around,
like, your comment towards,like, ragging on builders. I
don't, I don't think that it'sas much as ragging on builders
(34:24):
as there's been more discussionand conversation brought up
about the reality that they dealwith, right? And sometimes the
reality isn't pretty. And toanswer your immediate question
of like, how the market isshifting, is, I think that
builders, after 2008 recoveringfrom that, lot of businesses
(34:46):
were born. A lot of businesseswere failed there in
construction. Get over thathump, then we see covid 2020,
tons of supply chain issuesmatched with truly historical
low interest rates. And you'vegot. The supply chain dynamic
with the market gettingflooding, with clients wanting
to build, and a really hotmarket and a ton of
(35:06):
appreciation, right? There's alot of builders in 2020 that ran
out there and thought that theywere the best business people in
the world because they coulddouble, triple their top line
revenue in 1218, months, right?
So I think, like, kind of thatperfect storm comes back into
this huge emphasis being placedon, okay, I've seen it all
right? I've you've got thebusiness owner that started in
early 2000s or 2008 and theyweathered the storm, and they
(35:30):
built something that wasconsistent, and they're making
money and building families andemploying people and impacting
community. And they saw a dip,and then they saw an explosion,
and then you start to get thesepeople that pull back. I think
the market is ripe and trulybegging for an easier way to
understand their businessthrough the lens of a business.
Am I making? What I should bemaking on these projects? I
(35:52):
think from a technologystandpoint, it's a super
interesting time to be inconstruction, because a you've
got a huge new wave, newgeneration wave coming into the
sector. Much more techinterested, tech forward, um,
and I think they, a lot of them.
(36:13):
I mean, as you know,construction is a generational
type business, right? Daughterbuying the business from mom,
dad, brothers, whoever right,and I think they saw those
trials and turbul, tribulation,tribulations, not tribulations,
turbulence. There wasturbulence. But they see those
situations, and they want tocome at it through a little bit
(36:33):
more strategic lens. And theopportunity that poses for
technology is to providelegitimate, automated,
compelling solution, not justwhat was typically bloating the
market. From an optionstandpoint, historically,
there's a ton of ton of productsentering the space. I think I
was talking to Nick Schiffer atthe contractor coalition Summit,
(36:54):
and he was saying there was like200 new software products or
something at the Internationalbuilder show, and it's like it's
just exploding, right? And Ithink again, you don't, you
don't stand up a software youdon't raise a ton of money, you
don't take a huge personalfinancial risk to build a
product, if everything was sogreat that was already being
(37:16):
presented, right? So I think,like, my answer long winded,
albeit, is kind of anaccumulation of all those
things. If you're a generalcontractor looking to scale your
construction business and you'reserious about treating it like a
business, then this one's foryou. The contractor coalition
Summit is a four day all in nobullshit experience, hosted by
(37:38):
Brad Levitt from aft andPhoenix, Nick Schiffer from NS
builders up in Boston,Massachusetts, also the co host
of the modern craftsman podcast.
Tyler grace from TRG homeconcepts, also a co host of the
modern craftsman podcast. Morganmolotar from construction to
style. And Mark Williams fromMark D Williams custom homes,
and the host of the curiousbuilder podcast. Now I give you
(37:59):
all that context because I wantto highlight that these are real
builders, sharing what actuallyworks, and they are massively
motivated to help the industrybetter as a whole. In this
event, you'll learn everythingfrom AIA documents, cost plus
contracts, org charts, brandpartnerships, how to position
(38:20):
your business to be as healthyas it possibly can, and when as
much work as Re is reasonablenow there will be high impact
strategy, real talk, great food,even better. People in
attendance, and if you want adiscount, hit me up at Reese at
adaptive, dot build or go to myInstagram at Adaptive Reese, and
we've got a promo code. Thepromo code is adaptive 25 for a
(38:43):
20% discount. Space is limited.
Get in while you can. We'll seeyou in Chicago.
Yeah, no, I love that historylesson that was, I think you
said that really, really nicely,and it's a good way to sort of
think of the snapshot. And I'msure you just took some builders
back through, back through timeof their prior years too. I
(39:04):
think the only other thing Iwould say that is, one thing
that I see that is is reallycool, is whether it's the new
generation or people who havebeen doing this for for, you
know, decades. Is the way thatother technology they see, even
just in their personal life,gives them that aha moment of,
hmm, there must be a better wayto do this in my business. Like,
(39:28):
you know, whether it's theirtheir own personal banking apps,
I've had clients say that to mebefore, like when I'm in my
banking app, or when I'm doingmy my family's finances, I can
do this or that. I want to beable to do that in my business,
to which I respond, we candefinitely do that in your
business, and that's cool tosee. Then, what I've seen is
business owners starting to sortof bring those ideas from
(39:49):
totally unrelated areas of theirlife and look at their business
through that opportunity, whichis exciting, totally,
totally, I think, I thinkthere's just like generally,
there's just a lot more intenthappening. Me into construction
right now. And even, like, it'snot even just like the new wave,
that's certainly a biginfluence. You know, you get,
you get a lot of younger people,more tech forward. I mean,
(40:09):
they're hearing AI, they'recurious and how they apply it to
their business. But I'm serious.
I mean, we've, we've gotcustomers that are 6070, years
old. They've been in thebusiness for 50 years, and
they're even seeing it. They'relike, this is ridiculous. This
has always just been status quo.
It's always been it's a goodenough process. There's options
(40:33):
out here to make it better, andthey'll adopt very quickly, very
quickly. The problem resonateswith them. When you talk to
them, they say, who likestracking receipts? Yeah, like,
that's a no brainer, right? It'slike, the shoebox method. It's
like, okay, it's working, but itwhen you really break it down,
it's like, what is the time ittakes to process a receipt? And
(40:53):
you look at the dollar amount onthe receipt, and it's important
to track every dollar, butyou're like, it cost me more to
process and track this receiptthan it was actually worth,
right? That's when you start tolike, see those guys start
scratching their head. They'relike, let's talk. Yeah, yeah.
I love it. Anything else thatyou think is tactical that you
(41:15):
could share with builders, Ithought this was great from a
forensic standpoint, how to viewyour business, but anything else
tactical that you would want toleave the listeners with?
Yeah, I think something that'sbeen very top of mind for me
recently, that we didn'tdiscuss, that it definitely is
an aspect, a huge aspect, ofadaptive and and I think a
(41:36):
problem that I don't necessarilyget to with my clients until we
sort of put the fires out, istheir AR cycle, which, for those
listening, is how fast you aremaking that turnaround on
creating an invoice, and thenhow quickly your client pays
that invoice. I don't thinkenough owners are really
thinking about that and also howthat feeds into bill pay and the
(42:00):
timing of how long does it takemy client to pay me? When am I
paying my vendor and how long amI just out that cash? So I don't
necessarily have tips there, butit's definitely something I'm
thinking about a lot, andencouraging all of our clients
to also think about more and seehow we can tighten up that part
of the financials. Totally.
(42:21):
I love that you brought that up.
Happenstance, another builder.
It was, he was actually out ofAustin. Same conversation, he's
in there. He's like, I'm gettingready to do this big project at
the development dozens of units.
He was like, I used to be ableto float AP at a much smaller
level of business floating APfor the listeners is you get 15,
(42:42):
$20,000 in invoices. You canbasically carry that as the
lender to get your subs paid,waiting for you to receive the
money into your business tocover those costs.
Yes, it's basically lendingyourself, lending yourself
money. Essentiallyyou're a banker, not a builder
at that point, right? And pointbeing is the conversation. There
(43:04):
was, he was like, we've got tofigure out how to speed this up.
And like, the immediate side ofthat was, was like, quicker
payments to the subs. But thenthere was, like, it takes us a
week to get our draws together,and then it takes so the bank 10
days, and sometimes they gottasend someone out to inspect it,
and then we've gotta get themoney to the subs. And like,
(43:26):
you're looking at like, it'salmost like a 20 business day
process, and you're like, thisis absolutely insane. And that's
where it's like, it's more aboutthat immediacy and
understanding. It's like, okay,here's all of my costs that I
have coming in the pipeline, Ican see a real time view of what
my cash flow position actuallyis and what projects I need to
be collecting from, and then howquickly can I get that invoice
(43:48):
out to the customer or to thebank so that then they can fund
confidently the cash that Ineeded to pay the cost that I
have coming down the pipeline?
Yeah, and then it's when youthere's the the worst case
scenario where someone is 234,months behind on invoicing their
clients at all. And that's like,it hurts my heart because they
(44:11):
there are, they're funding theirclients projects. And then when
you get caught up, and we're inthis great place, okay, now
we're invoicing every singlemonth at the exact same time,
awesome. Then becomes this fungame of like, how can we get
that tighter and tighter andtighter so that you as the
business owner are holding ontoyour cash for as long as
possible, which you can thenleverage in a variety of ways?
(44:33):
So totally, no, I think that'sgreat. I think that's like, the
general theme wrapped up nicelyin this conversation is like,
you really can't get to thatpoint until you've made a lot of
the checkpoints that we hadtalked about right accounting
operations. Chloe Brown,everybody you talked about not
wanting to plug yourself. Butlet's just end on, like a little
(44:54):
plug for wildest dreams, howthey can get in touch with you
where this process typicallystarts. What sweetest? Services
do you typically provide?
Yeah, you can find me at Chloe,C, H, l, o, e, at think
wildest.com Our website is,think wildest.com and I truly I
mean this so much. I lovetalking to business owners, and
(45:18):
I would be happy to usually,I'll schedule a 30 minute call.
We go an hour and I I just enjoyhaving those conversations, and
even if we don't end up workingtogether, just being able to
shed some light. I do thisbecause I love supporting small
business owners that are feedingtheir families and feeding their
team's families, and I'm superpassionate about helping those
(45:41):
business owners be moresuccessful. So I would love to
chat.
Love it. Love it. I think that'sgreat. And I think even just
like to the early remark of thesales consulting pro bono that
you provided, it's all aboutlearning about the problem.
Right to Chloe's point, sheloves having conversations with
builders, understanding theproblems and situations you guys
are in. She has, she's, we've,literally, we've had her bring
(46:02):
us customers. We've sent hercustomers for the last two,
three years, and they all havegreat experiences. Um, so hit
Chloe up if you're wanting to dothese deep dives and just get a
little bit better financialpulse on your business. But, um,
Chloe, this was great. Youcrushed your first Was this your
first podcast? This is yourfirst podcast.
I don't think it's like my firstfirst, but it's Yeah, first,
(46:23):
maybe in a long time, it's I'mnot, I don't think I was born
for the stage. So youwere great. You were great.
Yeah, you were nervous aboutdoing this. You you absolutely
crushed. This was awesome. Itwas a good conversation. I love
that you asked me questions.
Normally, I'm the one justasking questions. This was good.
It was a good dialog.
Good. Well, that's what, yeah, Ithink with like, the sales
process, especially, I alwayssay I'm terrible at sales, but I
(46:44):
make a lot of sales because I'mgenuinely, like, very curious.
And I think that's like, justthe way like to sell, because if
you're genuinely curious, youhave a stimulating conversation
with the person about the thingsthey care about. And so I'm glad
that that came across a littlebit. You
did great. You did great. Well,I'll let you get back to it and
(47:06):
wait. Are you gonna be in someyou're not gonna be a sun Bell.
No, I'm going to thatconstruction accounting, or
accounting with Hector Garcia.
It's like a small, small groupdoing, like a technology and
construction Think Tank thing.
So I will, I will talk aboutadaptive, I'm sure, yeah, yeah,
well, whatever. Well, enjoy, andI guess, yeah, we'll, we'll see
(47:27):
you when we see you. Okay, thankyou so much. Appreciate you.
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