What Roofing Looks Like in 2030 (You’re Not Ready for This) with Adam Sand

Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
SPEAKER_01 (00:00):
If you're just counting on banging on rules

(00:02):
when the storm comes, likedirectionally correct 2030.
That's probably not gonna be abusiness model you can count on.
You can still milk it for whatit's worth now, but if you're
not recycling that capital intobuilding the roofing company
that will be around 2030, youdon't deserve to be successful.
If you can find out how to makea 25% gross profit margin and

(00:26):
still make a 10% net profitmargin, the laws of capitalism
rule.
You you win.
Because everybody bought a roofor rather bought a boat.
Nobody cares that much about howgreat the sales guys' teeth
were.
It needs to be a better pathwayfor roofers to get that second
lease on life that doesn't flyin the face of the culture and

(00:49):
the vision and the equity thatthey've built in their team and
in their community.
It really sucks when your lastname is the name of the roofing
company, and now you kind ofcan't go to church because the
copy are squeezed, that they'redoing things differently,
they're not supporting the localcommunity the way they were
because that's just consideredfrivolous spending the sponsor

(01:10):
the baseball team.

SPEAKER_03 (01:11):
Welcome to the Roofing Success Podcast.
I'm Jim Aline, and I'm here tobring you insights from top
leaders in the roofing industryto help you grow and scale your
roofing business.
Adam Sain, good to have you.
Yeah, it's good to be here, man.
Thank you for the invite.
It's kind of crazy to me.
I mean, we've kind of we've Idon't know, I've known you in

(01:33):
the industry.
I think you've known me in theindustry for years, and we've
like have bumped into each otherat a couple of events, but we
never got a chance to sit down.
I'm I'm pushing 300 episodeshere, and you are one of the
people that that has had a greatvoice in the industry, and I
thought has a like it has reallyreally helped shape a lot of
people, a lot of theconversations that happen in the

(01:54):
industry from a technologyperspective, marketing
perspective, even up, you know,operations and things like that.
So glad to have you, man.

SPEAKER_01 (02:01):
I'm glad to be here, and I'm I'm excited to be uh
getting a chance to to speak tosome new people and hopefully
you know make some new friends.
That's the the whole idea isjust to connect more with the
industry that has been such abig part of my life.

SPEAKER_03 (02:15):
If anyone doesn't know you that listens to this
podcast, I think we have apretty shared audience, but
anyone that doesn't know AdamSand, who's Adam Sand?

SPEAKER_01 (02:25):
Well, yeah, so I try and keep it short.
Uh, I had a guy with a veryvaried career.
The roofing industry loves to belike, Are you a roofer?
You know what I mean?
Did you do you know did you doroofing?
And it and so the answer is yes.
I owned a roofing company, butit wasn't because I woke up one
day and thought of owning aroofing company, um, or that I
ended up a roofer per se.
I had a very varied past.

(02:45):
I built an app, I owned tenantslawns, sold vacuum cleaners door
to door, was a bodyguard, was inthe military, worked at oil
rigs, sold cars.
My buddy was a shingler, and hewas perpetually broke.
And I was like, wow, you know,you want to go do stuff.
You never had any money.
And I thought, why don't youstart your own roofing business?
And so I loaned him some moneyto get a business license and
buy some tools.
He got the tools stolen, so Iloaned him some more money.

(03:08):
And uh I figured out prettyquick that I wasn't gonna get my
money back if I didn't help him.
So I helped more because I atthe time I was a sales manager
at a car dealership, and I hadsold another business, and I
kind of got that entrepreneurialbug.
So I started a roofing businesswith him.
And back in like 2016, 2017,when I was helping him, I
thought, man, how do we getcustomers?
And you know, back then Facebookwas kind of new, you know, it

(03:32):
was not new, but it was new tolike nobody on home services was
really running ads.
Like today, you can't throw ashingle off a roof without
hitting five guys in the headthat are offering you Facebook
ads for roofers.
But back then, I tried hiringlike an agency, they told me
that was dumb.
I tried, I fired them, hiredanother agency.
They said that they did Facebookads, but then they told me that
was dumb.
So then I went off and searchedwith some kind of Joseph

(03:54):
Hughes-like character, right?
Somebody who could teach me,there was no one.
Then I was like, maybe it wassomebody who's home services,
there was no one.
Brick and mortar, there was noone.
And finally I found this guynamed Rick Mulready, who had a
podcast called The Art of PaidTraffic.
And I kind of came to thisconclusion that the easiest way
to make money online was to sellhow to make money online because
everybody was selling, and stilltoday, it seems like that's the

(04:15):
case.
Still today.
Still today.
I kind of like had a little spazsession in his online chat 20
minutes before cart close on hiscourse that he was selling.
I said, You guys don't know howto run ads for brick and mortar,
real home services businesses,and blah blah blah blah blah.
I'm just a hater, right?
And he's like, Well, you'reright, and I don't know how you
would do it in home servicesbecause there's no buy now

(04:35):
button and roofing, but I canteach you how Facebook ads work,
and if you want to buy it, buyit, but otherwise stop bugging
me.
So I bought uh and I learnedFacebook ads.
I spent a lot of money failingbefore they finally put like ads
in the news feed on mobile, andthat was kind of the first
trickle of success we had.
And then they got video and thenthey got live video, and we
started to get some success.

(04:56):
And back then, you know, rooferswould be like, You're stupid,
you don't advertise on Facebook,and like back then it was like
if it wasn't referrals, it wasdumb.
Um, but then because of theearly success, I got interviewed
on like 20 podcasts aboutFacebook ads, not really
roofing, but Facebook ads.
So like 2018, 2019, if youlooked up the words roofer and

(05:17):
Facebook ad and Google, therewas a lot of interviews in me.
So then all of a sudden, allthese American roofers started
reaching out, and I was like,Man, it'd be cool to have a
podcast.
And I was like, What do I callit?
I'll call it the roofingbusiness partner podcast because
I'm a partner of roofingbusiness, I'm not very creative.
But then uh we just next thingyou know, uh I I just started

(05:37):
like I started a course, youknow what I mean?
Because I thought, well, I paidfor a course, maybe someone else
would pay for it.
And then some like rich rooferssaid, I don't want to take your
stupid course.
Can you just run my ads?
And I said, Yeah, sure.
Then we started getting firedfor getting too many leads,
which I'm sure is like, how theheck does that happen?
Right.
And and it's not that I was someMaven.
Back then it was just easy,right?
Yeah, and uh, because nobody wasdoing it, you know, and so

(06:00):
people were just excited to seea local business on Facebook.
And uh and so when I asked themwhy they're firing me, well,
they would say, Oh, we put thewrong color on Mary's house and
we didn't get back to George andhe left us a one-star review.
And I was like, Well, how do youuse your CRM?
I said, Well, we go on Aculinx,we print off the screen, and
then we staple it to this folderand we put it on the wall, and
then we move it across the wall,and people take it out and put

(06:21):
stuff in, and then we're done.
We scan all the pages and uploadit to Aculinx.
And I was like, that's not how Iuse a CRM.
Let me show you how to so keeppaying me.
I'll show you how CRM works.
And you know, it just I keptbuilding, I kept helping in
CRMs, and I was building CRMs,and I was flying to roofing
companies and spending mywinters, you know, in Hawaii or
Texas or Florida or you know,Wichita.

(06:43):
And uh and I fell in love withAmerica.
I fell in love with with helpingpeople, and um, you know, I had
a roofing company in Canada,it's not a great opportunity,
and and America is just such aland of opportunity that I just
pursued this full time, left thebusiness.
And uh, and so yeah, now we'veworked with you know a couple
hundred roofing companies andbuilt you know 50, 60 CRMs, and

(07:04):
it's been it's been a journey.

SPEAKER_03 (07:07):
It's been a it's it's an amazing thing.
Like that's or you know, youknow, from the marketing agency
side, it it's crazy.
We ran into a lot of the samethings.
It's like, well, what do I donext?
Like, you know, well, this isn'tworking.
Well, you're not answering yourphone, and then you're not
answering your phone correctly,and then you're not setting the
appointment right, and then yoursalespeople are not trained
well, and then it's i i i i talkto agency owners all the time.

(07:30):
I'm like, how far do you want togo into people's businesses?
And so you went deep.
You before we carry on with theepisode, let's give a shout out
to one of our sponsors.
Roofers, let's get real.
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steady stream of leads?
That's where job nimbusmarketing comes in.

(07:51):
They know the roofing industryinside and out, and they'll help
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If you want more quality leads,more book jobs, and more growth,
visit the link in thedescription or the sponsors page
on the Roofing Success Podcastwebsite.
I talk to agency owners all thetime.

(08:12):
I'm like, how far do you want togo into people's businesses?
And so you went deep.
You got deep into my business.

SPEAKER_01 (08:19):
Because I I saw the writing on the wall.
Facebook like ads, man, likeback then, like Dimitri.
We all know Dimitri, like he wasreally like mark giving
marketers a bad rap, and and youknow, and you know, he's evolved
a bit in terms of his opinion,but back then it was just like,
and back then there was a lot ofscammy people, right?
I mean, yes, um, and there isstill today, but there's there

(08:40):
still is, yeah.
Yeah, so the so I just like Ididn't want to be lumped in with
this like scammy group, but whenyou could actually just say, all
right, well, you know, there'sthis great story that Steve Jobs
tells, and he says, Um, youknow, it was back when he was
trying to explain what acomputer was to people.
And he was like, Well, if youlook at this old like Scientific

(09:01):
American um magazine, it itbasically did a study on all
animals and which ones burnedthe least amount of energy, thus
were the most efficient totravel a distance of like a
hundred miles.
And he asked the reporter, Well,which one do you think is the
most efficient?
And people guess things like afish and a bird, and you know,
some people say human, but um,he said it was the condor, it

(09:24):
was a bird, right?
And then he says, Okay, well,where do you think humans are?
We're like in the bottom third,you know.
I mean, we're not very gutranking on efficiency.
Granted, we can't fly.
So then he said, but if you givethe human a bicycle, they become
twice as efficient as thecondor.
So this technology unlocks alevel of efficiency, and

(09:46):
computers are like a bicycle forthe mind.
And I and and that always stuckwith me because my parents were
really big, like my dad couldn'tread, you know, the Apple was
the Mac was dropped in 1984, theyear I was born.
And my dad just said he's got tolearn how to read good, and he's
gotta learn how to use acomputer, you know, and so
that's what my parents shoved inmy face was books and computers.

(10:08):
And so I kind of fell in lovewith them at an early age
because my dad held them in suchhigh regard.
And uh, and so when I sawproblems in businesses, it
always just became a naturalinclination to say, well, how do
we treat this like a bicycle forthe business?
Like, how do we just usetechnology as a lever?
And I fell in love with the ideaof like measuring success in

(10:31):
revenue per capita, a revenueper like 85,000 payroll, because
it was the only thing that waslike that's predictably valid
and true that like if you canincrease the revenue per
employee, right, then you haveless people to hire and manage
and you know deal with theemotions and recruit and be

(10:51):
betrayed by, but your revenuegoes up, and generally you're
taking away the mind-numbing,soul-sucking, unrewarding,
unfulfilling tasks, right?
Or removing the opportunity forfailure that leads to otherwise
good people, you know, beingwritten up or being fired or
just being ostracized for makinga mistake that costs the company

(11:11):
money.
And I couldn't do that with aFacebook ad, but I could by
getting into the operationalinfrastructure of the business.
And I just fell in love with thelevel of like, you know,
provable impact, right, that wecould have.

SPEAKER_03 (11:22):
But yeah, yeah, that's awesome, man.
Kind of moving into the the thecore topic today.
In in in we wanted to talk totalk about what roofing looks
like in 2030.
One of the things that I've I Ihave this kind of thesis now or
hypotheses now around we're in awe are in the early stages of

(11:48):
labor arbitrage.
And it kind of goes along withwhat you were saying in in in
the butt with the bicycleanalogy and with what you helped
with with CRMs and things likethat, and help increase
efficiency that the revenue peremployee number.
I really feel I've had thisconversation with a lot of
people, I really feel like thereare technology creates arbitrage

(12:10):
especially for a certain amountof time, right?
I don't think that the CRM iscreating as much arbitrage as it
did back in 2016-17, right?
Like the the when when it wasmore pen and paper.
But when it was pen and paper,if you were using a CRM, my
goodness, the the the arbitrage,the efficiency that you could

(12:31):
create out of your team.
I feel like we're in the nextwave of arbitrage, the of labor
arbitrage through technologywith all of the implementation
of AI and all of the cool toolsand things that are that are
being developed, and who knowswhat they will become.
What are your thoughts on onthat?
I know you're enjoying theepisode, but let's give a shout

(12:53):
out to another one of oursponsors.
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(13:14):
And when change hits, they'rereacting instead of leading
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(13:34):
Success Podcast website on thesponsors page to start your
journey today.
The next wave of arbitrage, theof labor arbitrage through
technology with all of theimplementation of AI and all of
the cool tools and things thatare that are being developed,
and who knows what they willbecome.

(13:55):
What are your thoughts on onthat?

SPEAKER_01 (13:57):
I I like where you're you're taking this, and I
I agree with you in the sensethat um you know there's enough
conversation going on about thisthat we're even discussing like
post-labor economics, like notjust like labor arbitrage, but a
realistic post-labor economics,like how what's going to happen
when enough jobs get displacedthat like a 10% unemployment is

(14:22):
like people coming for people'sheads.
You know, there's fear amongstthe wealthy that like this could
create uh another like let themeat cake moment, you know, and
we don't really want that.
And so, I mean, to kind of zoomout, right, to to try and like
say what does a roofing companylook like in 2030, we have to

(14:42):
understand like what in my whatis my opinion based on?
It's based on um there's threetectonic shifts that are really
affecting the roofing industryspecifically.
Um, the one is the is thecapital markets, right?
Just the general flow of money,right?
Capital markets are constrained,interest rates are kind of
stubbornly high.
We're dealing with all these umall these disruptions in terms

(15:05):
of of uh of tariffs and and andyou know a reshaping of the
global you know economic model,right?
That is having kind of like thisthis it's again, it's it's not
something you feel walkingaround day to day, but the
tectonic plate is movingnonetheless, and there are
points where friction causesearthquakes in this whole

(15:26):
situation.
The second is um the privateequity disruption of our
industry and and just thegeneral nature uh of the
invisible hand of capitalism.
The problem with roofing, uhjust as a as a business model as
it relates to capitalism, isthat you have roughly 300

(15:50):
companies that are over 17million in revenue.
You have 60,000 between threeand eight million in revenue.
Those three to eight milliondollar roofing companies all
have a marketing agency they'repaying somewhere between$2,500
and$7,500 a month for.
They have a bookkeeper thatthey're paying$2,500 to$4,000 a
month for.
They have a receptionist they'repaying$2,500 a month for.

(16:11):
They have uh they're all payingfor the base level cost of
things like a CRM and asubscription to Hail Trace and
an Xactimate license and so onand so forth.
Um, and a lot of those, a lot ofthose things create this froth
in the market, and they'reselling the same shingles,
right?
They're buying the same six orseven, they're installing them

(16:32):
the same way because it'smanufacture spec to get your
master elite warranty, right?
You're using the same tools,everybody's got a metabo nail
gun in their hand.
It's the same group of sixHispanic dudes up on the roof or
Amish dudes, or we know the lastgreat white roofer retired a
long time ago.
So it's whatever, like they'repretty much nobody's putting
waitresses on the roof to createan experience, right?
They're installing it more orless the same out of time.

(16:54):
No one's found a way to do ittwice as fast, despite what
every proud roofer might want tosay.
Um, you're not, and you're andyou're doing it for more or less
the same price, right?
Like in the case of insurancefor the exact same price.
So, what makes these companiesdifferent?
They have to continually pay for$20,000 websites and and things
to try and stand out.
And the homeowner is left tolook at you know, 35 roofing

(17:17):
companies in Denver, Coloradothat have a 4.9 star rating or
better and 100 reviews or more.
Where do you what does theconsumer pick from that?
And so the operators that createefficiency will like will create
um the ability to drasticallyreduce the froth, the the extra
expenses that add to the grossprofit margin needed to operate

(17:40):
a roofing company.
As you consolidate that, therules of capitalism dictate that
there will there will be areduction in price.
And we need to save America, wekind of need some deflationary
pressures.
So, like that's going to comefrom the productivity per
capita, the GDP.
And this is what lends to thethird test tectonic plate, which
is the AI, right?

(18:02):
This concept that there's abillion PhDs that just came on
the labor market and they'rewilling to work in roofing for
pennies, and they'll do, and youcan pay for it in a results as a
service as opposed to softwareor access as a service.
So you can, you know, everybodyin their uncle right now has
some kind of voice receptionistagent thing that will answer the

(18:24):
phone.
And, you know, some of them arecoming to the conclusion that
rather than paying for minutesor monthly access, you can just
charge per appointment bookedand result-oriented.
We have one, you have one, sameday's got one, everybody's got
one, right?
Everybody's adding a sparklebutton to their software because
every CEO is having to answerthe question what is our AI,
what is our AI um motion, right,for our business?

(18:47):
Because every CEO has got to getthat AI multiple for their VCs
and for their shareholders.
So, and there's probably abubble that's going to rear its
ugly head eventually aroundthat.
So those three tectonic shiftplate shifts.
So then now, and though thoseare ubiquitous across many
industries, you know, privateequity is especially in roofing,

(19:07):
more so than others, but butthose three tectonic shift
plates are the kind of the globethat we operate on.
And then we have to think likewhat are the buildings on top of
this foundation?
So, two particular buildingsthat I find interesting, I call
them Billionaire Tower A andBillionaire Tower B.
Okay.
And in Billionaire Tower A,you've got an insurance company,

(19:29):
right?
And they're making gazillions ofdollars in profit.
You know, there's this wholedebacle of the Veris Gask
acquisition, right?
They're making tons of profit,and they're sitting on the 80th
floor of Billionaire Tower A.
And every time a storm comesthrough, they got to pay out
some claims, and it's annoying,right?

(19:51):
But in Billionaire Tower B,right, they look up and they see
on the 82nd floor is a shinglemanufacturer.
Because every time a stormhappens, GAF or Owens Corning or
ICO, I'm not gonna, you know,nobody's better or worse in this
scenario.
But when a storm happens,they're smart enough to every

(20:12):
couple of years make theirshingle one millimeter smaller
and one millimeter taller, andnow long, it's no longer
matching, right?
And when they'll go and put awind warranty that's unlimited,
you know what I mean?
God himself for the first 15years could blow your roof off
and we would cover it.
But then the minute a windstormblows a bunch of roofs off in

(20:33):
Hawaii, the first thing they dois send out one of our roofing
industry's pundits about claimsmanagement and supplementing and
send them out, rent a hotelconference room and say, Have
you taught people about claims?
They're like, wait, but doesn'tmy customer get a warranty for
those shingles to blow off?
Ah, you don't want to do thatbecause then we're gonna look at
your roof.
And if your nail pattern'swrong, you might lose your

(20:54):
certification that says you'rethe best, and like you wouldn't
want to.
We don't want to like have Ihave have you met Becca?
She'll teach you all aboutinsurance claims, you know?
And so billionaire tower A guyslooking up being like, you
bastard.
Well, what do insurancecompanies usually have a pretty
close link to the financeindustry, right?

(21:15):
And where what do we know aboutprivate equity firms?
They're usually leveraged,right?
So where are they getting theirmoney?
The banks, who's in with thebanks, the insurance.
So this is a little bit of atinfoil hat moment, but I think
that what you're going to see,right, is large roofing
companies that are privateequity backed, then start to

(21:37):
decrease the nuclear arms racebetween the roofer and the
insurance company.
Because it's kind of ratchetedup.
It was like, oh, you gotta somedamage, call a roofer, get a
quote, we'll pay for it.
Oh, wait, you didn't actually doyour roof?
Okay, now we're gonna give youtwo checks.
One after you prove you did it.
Oh, the roofer said it'sdamaged, we don't believe it.
We're sending an adjuster.
Oh, the adjuster says it'sdamaged, but your roofer talked
about the policy.
Let's create a law that saysthey can't talk about the

(21:59):
policy.
Oh, so now they got a publicadjuster and the claims 25%
higher.
Well, we're gonna send, we don'tbelieve it should cost that
much.
Okay, well, now they hired anappraiser.
Well, now he agrees cost thatmuch, but now we're gonna fight
it in court.
And then, oh, and what's thisassignment of benefits thing?
Let's shut that down, right?
And so this arms race hasprogressively gotten higher.
What do we see?
It's it's hurting the policyholder, the customer of both of

(22:21):
these businesses is paying 3% ofthe home value of an inflated
home that's gone up 37% in fiveyears.
They're paying 3% of that realestate value to get the roof
insurance.
Like it's crazy.
And so, you know, insurancecompanies have the right to
waive a deductible.
And this is not some likemagical recipe.
We see this in healthcare, wesee it in cars, and like the

(22:43):
people who ran Boyd AutoCollision are running a roofing
company now.
So, like, this is not hard todraw the line between what is
the what is going to be theeventual outcome.
Um, I imagine a future where alarge private equity-backed
roofing company is going to justget 300 Xactimates sent over to
them from an insurance company,and they're gonna schedule a

(23:04):
drone pilot, not a salesperson,a drone pilot to go to the
house.
They're gonna fly it, they'regonna use a software like Level
and Innovations or Roofhawk orany of these other tools that
come out.
They're gonna use AI-poweredimage processing to create a
standard of measurement for whatis and is not damage.
That AI report is gonna say thisis damaged this much, and then

(23:25):
this is what it costs to fix it.
Both of them are gonna agree todo it.
And if you agree to let theinsurance company's preferred
vendor do the roof, you they'regonna waive the deductible and
squeeze all the competition outof the market.
And ultimately, they're gonna dothat because the goal of the
insurance company is to keep themonthly recurring revenue coming
in.
And there's a provable, there'sa provable KPI that after a

(23:48):
storm, depending on homeownersdon't change their homeowner
insurance until they have areason to change their homeowner
insurance that generally comesafter a storm, depending on
their own personal perception asto how the experience was.
They're gonna vote with theirwallet and they're gonna go from
state farm to all state and havethe same exact experience over
there, too.
But it was their way to say, Ididn't like the way you handled
that.
And when you ask a homeownerwhat do they want after an

(24:09):
insurance claim, they want nomoney out of pocket and they
want to get the roof fixedquickly and they want to be a
painless experience.
And the roofing company justwants the work, they want the
30%, 40% gross profits that andif they can do that by
eliminating the need foradjusters and salespeople and
public adjusters and appraisersand court cases and all this

(24:30):
stuff, one side's gonna give upa little bit of gross, right?
And what and and some of thesupplementing gain, right?
And the other side's gonna giveup a little bit of the maybe
approvals that they could haveavoided.
Both sides are gonna decreasethe people that they need
through this AI poweredtechnology lember that creates
uh labor arbitrage.

(24:51):
Um, and then that's gonna leavea lot of the market you know
unable to play the recipe thatthey did.
So, like in a in a 2030perspective, I think that we
would be directionally correctto assume that the escalation of
the arms race on the foundationof these three tectonic shifting

(25:11):
tectonic plates shifting, thatuh there will be a new way that
roofers who aren't a part of thelarge insurance restoration
pipeline are gonna have to makemoney.
And to kind of your point aboutthe the CRM and whatnot not
having the lever, I had thisI'll say this and then I'll I

(25:35):
would love to get your thoughtson what I said, but I just kind
of want to get this like wholecomplete thought.
Um the I had this idea that Iposted in Slack in this like
Adam's brain channel, it'sbasically where I just dump
ideas that I think about whenI'm half asleep in bed or
jumping out of the shower.
And I had this like idea of likethe things I have to do CRM.
It was like T I H D CRM.

(25:57):
And the the idea was that youknow, I saw when HubSpot
integrated with ChatGPT.
Basically, like in HubSpot, youcan just click connectors and
click HubSpot and sign in, andnow ChatGPT is like in your CRM.
So then you can go in there andjust ask it questions or make it
do things or send it, send anemail, or drop draft me an email

(26:17):
and then send it to these threepeople.
Like, you know, you could dothat.
And I thought there's the I'vegone on this this every time a
roofer asks what's the best CRMin the Facebook groups, which is
like every third day, I havethis like couple of different
responses that I have can that Ijust post because it's good for
business, and but it was alwaysfocused around this one cardinal

(26:39):
statement at the beginning thebest CRM is not is the one that
you use, and you know, that'sone thing that's cycled by
everybody at this point, and uhand I probably learned it from
somewhere else.
But the the new world is likethe best CRM might be the one
you don't have to use.
Yes, right?
If it used to be that my job asa person building a CRM, the

(27:01):
ultimate measure of like whatmade people happy was that if
they went and did a thing, theydidn't have to go on the CRM and
also say they did the thing,they could just do the thing and
the CRM knew that they did thething.
That just meant that like whenyou ordered the material order,
it moved to it checked a boxthat said material orders and
removed that tag off something,you know.
But now it's more like oh well,when jobs install date is seven

(27:27):
days out, it just orders thematerials.
It's a CRM you don't have touse.
And the when we look at thatearlier point of the froth in
the roofing industry, if you canfind out how to make a 25% gross
profit margin and still make a10% net profit margin, the laws

(27:49):
of capitalism rule you you winbecause everybody who bought a
roof would have rather bought aboat.
Nobody ever sinked.

SPEAKER_03 (28:04):
And the other side of that is from a business
perspective, especially a bigbusiness perspective, a PE
perspective, that temp they'rewilling to take that 10%.
They want that 10% over a largeamount, right?
Like they'll take 10% on a lotof a little bit of a lot, right?
They it's it, you know, the thegrocery store model, right?

(28:25):
There's a lot of products thatget sold in a grocery store, but
there's no margins in thosethings.
But the amount that gets sold,that's where the that that's
what they're looking to achieveis at that scale, it still
maintains that.
And I love where you're goingwith that.
So let's start, let's let's diginto that side a little bit.
Billionaire A and billionaire B,the insurance industry, the

(28:49):
manufacturers, eliminating theuh a lot of the roofing
companies.
It do you think hasn't hasn'tthis been tried a little bit
over time already?
The managed repair programs andthe and things like that, like
there's been instances whereit's been tried.
Where do you think that changeswith this?
Do you think that they just getinto bed together?

(29:10):
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There's been instances whereit's been tried.
Where do you think that changeswith this?
Do you think that they just getinto bed together?
Or what and that's thedifference?

(29:54):
What's the I think Acolynx andVerisk is a big one.

SPEAKER_01 (29:59):
I think that you're going.
See that be the preferredsoftware, kind of like how Dash
did it in water restorationmediation.
I think that you're gonna seethat.
I think you'll see it fromService Titan.
I think you'll see integratedplatforms, right?
Um, more of an API typeconnection or an MCP type
connection.
Yep.
Um, but the other piece of it islike you got to be able to get

(30:20):
the work done.
I have a client in Hawaii who'ssuccessfully been the exclusive
provider for island insurancefor like seven years, but that
it was because they have 130in-house installers and their
their entire market is you knowan island that's 42 miles
across.
So it's easy to solve theproblem because what they care
about is can you do the work?

(30:41):
Can you get the work done?
Well, as the labor market isgetting kind of like more
legitimate as as the as theimmigration problem, right, with
the fact that there's a lot ofundocumented workers, which
create carries a huge liability,is that kind of gets cleaned up,
you know, and large companiescan lobby for a temporary

(31:03):
foreign worker program or alabor market investigation study
that turns into some kind ofpipeline to solve the labor
problem because not a lot ofkids coming out of college want
to be roofers.
As I believe that again, beingdirectionally correct as robots
get on roofs, right?
That's right.
Um, I think that the can you getthe work done problem will be

(31:25):
solved, right?
And because previously that'smostly what the moat was around
the small roofing company wasthe sheer difficulty of hurting
the install capacity becauseyou're you're dealing with
America's forgotten sons, you'redealing with technology averse
communities like the Amish,right?

(31:47):
That they're not allowed to havea phone, you know what I mean?
So someone else has to handlethe logistics.
Um, or you're dealing with theyou know, undocumented or
Hispanic, or even just themigrant community that is
looking for the opportunity, andwhatever pipeline of those is
coming into the country andfalls into the roofing trade.
That has been that that is alogistical nightmare.

(32:08):
And it previously the only wayto do that was you had to have a
lot more people to throw at thelogistics of running that.
But like trucking, right?
They you know I get that like alot of people don't love the
fact that like we're bringing inpeople from other countries that
don't know how to drive andgiving them trucking jobs.
But the fact remains that thetrucks will soon drive
themselves, and this is just themiddle stop, right?

(32:30):
Which is a flood of immigranttruck drivers to create these
massive logistics and shippingfirms, and eventually the trucks
will just drive themselves.
Yeah, and the rules are that'swhat I see a lot.

SPEAKER_03 (32:44):
That that that's what I that's where I see it a
lot too, and and that could be2030.
Like there there is some thereis an argument to be made that
it's already there in 2030.
Like Elon gets that hand figuredout on on his bot, you know what
I mean?
Like, that's what he like boy,it's there's going to be the the
the labor gets the the labor cango away.

(33:06):
And I love uh the way you putthat.
What happens?
This is the insurance market,right?
So what percentage of I've neveractually looked at this set,
what percentage of roofsreplaced in the United States or
in Canada or north, you know,maybe the two of them or
whatever, how let's just call itthe United States, maybe
wherever you find a stat onthere, no a stat on it.

(33:29):
What percentage of roofsreplaced every year are replaced
through an insurance claim orthrough a retail transaction?

SPEAKER_01 (33:36):
Well, it it changes every year.
So sometimes it's 40%, sometimesit's 70%, because sometimes,
like, you know, you pull timeand money forward.
I I just spoke with a guy, umBrian Ward from Quality Roofing
Solutions, and he kind of said,Look, you know, this year is
kind of a down year.
We're up on market share, butwe're down in total volume.
But the the uh, you know, weprobably pulled a lot of roofs

(33:58):
forward with the storms thathappened in not common storm
areas, like Tampa, which doesn'tfrequently get hit by storms,
did last year.
And so Tampa's market isprobably down this year overall.
So it is the number fluctuates,and those fluctuations are
something that that can bemanaged, um, larger when you

(34:19):
have a large roofing companythat can move labor force around
and and kind of respond, likekind of like FEMA, right?
Like, why do you have to haveFEMA?
Because sometimes one stateneeds help and another state is
just fine, so you gotta be ableto send them to California for a
fire, and then you gotta be ableto send them to New Orleans for
a flood, and then you gotta sendthem to Texas because they got
snow for the first time in 10years, yeah.

(34:41):
So, you know, the same willexist where the means of
production will kind of flow tothe larger companies.
And this is, you know, to speakto the Elon thing, like there's
a company by Brett Adcock calledUm Figure, which is like
arguably further ahead than him.
Than him, yep.
Um, you're seeing like in largeindustrial machines, the yellow

(35:04):
iron, you're seeing anothermassive tech company that is
basically wiring in machinelearning and AI and algorithm
sensors, all this kind of stuff.
The biggest thing is thesensors.
You have to create the sensors.
That's what allowed the militaryto get ahead.
That's where Palantir came from,is because that's where um
scale.ai got big was the in thethe photos that they could take

(35:25):
and the image processing thatthey could do and how that
impacted manufacturing.
The sensors are the biggest, thebiggest way to measure like
where something is going is ifthere's sensors being applied to
a particular mode of work, thenyou will see uh an eventual
disruption.
And so the sensors aren't reallyin roofing yet.

(35:46):
You got some guys trying to makea little robot that crawls
across a roof and install theshingles, but they don't have
sensors, they're just trying tomimic the work.
But when you can sense it, andthat's where the humanoid robot
thing comes in, because now thethe the sensor is kind of
applicable to anything that ahuman can do because the whole

(36:06):
world is designed around humans.
Designed around humans as wideas a car is a car is as wide as
a car is because a train wastires were wheels were that
wide, and that's why roadsbecame what they were.
And so they could just there'sthese uniform measurements that
start to that start to make iteasier to apply the next thing.
I think an interesting conceptmight be to see where warranty

(36:29):
claims come in.
Because if an insurance if aroofing company was to take the
approach of, like, you knowwhat, maybe we're not gonna go
get in bed with the insurancecompany.
Maybe we're going to have awarranty department.
And if those shinglemanufacturers want to offer
these unlimited win warrantiesand make these bold claims,

(36:49):
we're gonna hold them to thatinstead of having to fight the
insurance company becauseinsurance, finance, finance,
private equity, private equity,roofing.
Maybe they say, you know what,we're gonna start holding the
manufacturer to their claims,and we're gonna create a
warranty department rather thantrying to get a customer to pay
a$3,000 deductible, we're justgonna get the roof covered under

(37:09):
warranty, right?
And we're gonna have a warrantydepartment, kind of like how the
manufacturers have dealershipsand those dealerships call
warranties and they navigatethat process.
Um but it can you know it allcomes back to, you know, well
then what can you do as a roof?

SPEAKER_03 (37:26):
What what can that's what I was thinking?
Like now you the if theinsurance game gets played in a
different way, right?
Which it which it already keepsevolving into and it will
continue to evolve in a way thatprobably won't benefit the
average roofing contractor.
How do you how do you maintainthat?
What do you what do you do?
Yeah, that's where I was gothat's what exactly where I was

(37:48):
thinking.
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Your full AI team is ready.
How do you how do you maintainthat?
What do you what do you do?
Yeah, that's where I was go.
That's what exactly where I wasthinking.

SPEAKER_01 (38:48):
I think that the cool thing about AI is that as
it re redefines, like as AIbecomes better at most human
things than humans, it redefineswhat it means to be human.
And where the moat is for thesmaller contractor is going to
be things that are not like thethings that by definition do not

(39:11):
scale, right?
So specialty materials,commercial roofing, you know,
um, specialty, like specialtyprojects, you know, like hockey
stadiums and historicalbuildings and stuff like that.
The beautiful part about ourindustry is that no matter how
much AI comes out, no matter howmany robots come out, we're

(39:31):
still gonna want to sleepundercover.
You know, we're still gonna wanta roof above our head.
Um, so there's a certainly amoat in going to the things that
are not attractive to theinvisible hand of capitalism's
desire to consolidate and makeefficient, because there are
things that just can't be madeefficient.
Um, the other thing that if if Iwas a roofer today, and by the

(39:55):
time this comes out, this mightactually be public.
Um, but like my thing has beenfor years, I've kind of looked
at what I do.
And I work with these roofingcompanies, I come in, I do this,
like changing your CRM whenyou're doing 20 million a year,
let's just say, it's likechange, like it's trying to do

(40:15):
open heart surgery on a footballteam while they're trying to win
the Super Bowl.
Like if you had a donut shop andyou were like, you know, you had
Jim's donuts, and you saw, youknow, half a mile up the street,
a Dunkin' Donuts is lined up forbreakfast, it's lined up for
lunch, it's got a fullrestaurant, and then supper,
everybody's driving home, andstill got some people trickling
in at nine o'clock, and you'relike dead most of the time.

(40:36):
You know, you get a lunch rush,right?
Uh, people come to you becauseyou put more meat in a sandwich
and for the lower price, you'remaking your costs are higher and
your rice prices lower, and thatsucks.
So you go to Dunkin' Donuts,you're like, hey, can I be a
Dunkin' Donuts?
And they're like, Yeah, sure.
But this one register needs tobe two.
You need to have a clear donutcase in the middle.
You got to make some room on acounter for a slushy drink.

(40:58):
You need an oven that makes themtwice as fast and it's twice as
big.
So you're gonna knock that wallout, put that in.
You need a drive-thru.
So we're gonna knock that wallout, and we're gonna put a pylon
sign up front and a microphone.
You need a better point of salesystem, you need a baker, you
need a sandwich station, and youhave tables of six, you need
tables of two and tables offour, and you need a bar along
the window because then you canstuff twice as many people in
here, and you need to use theserecipes.

(41:20):
If you don't do that, it's gonnatake you six months.
You're gonna shut down yourdonut shop and be under
construction for six months.
You talk to a roofer aboutchanging the CRM.
They're like, So you mean Ican't just like install the CRM,
turn it on, and the next day mybusiness grows?
It's like, no, James, you'regonna have to like do some major
change management and like,yeah, it's gonna be a bicycle
for the mind, but you're gonnabe it's and it's very

(41:41):
unreasonable.
So I quit changing CRMs to likeyou're changing out the central
nervous system of your company.
The risks are super high.
If you wanted to, the amount oftimes that I've taken a 10, 12,
whatever, 50, 100 million dollarcompany through this change,
it's like climbing Mount Everestand coming back down.
Someone's like, I want to go upEverest and get some pictures
from my Instagram.

(42:01):
You're like, sure, no problem.
And you get them down, you talkto them like a year later, and
they got the pictures, butthey're like, Yeah, you know, it
wasn't it wasn't great.
It wasn't funny.
Like they would like notnecessarily relate to the
experience to something theywould tell other roofers to go
through because climbing MountEverest sucks.
And you don't they don'tnecessarily realize the amount
of life-saving measures that wetook to keep them alive.

(42:24):
They'll complain that like theygot frostbite on their nose and
they didn't get the sandwichthey wanted on the second day of
the trip, you know?
So this process of of goingthrough change, right, is
difficult for a roofingbusiness, but we have to be we

(42:44):
have to be kind of prepared forit.
So I I've done this all thesetimes, and it's kind of a
thankless job.
And I thought, you know, if Imade one percent of my clients
revenue, I would have made moremoney than I've made today.
And that kind of like sits thereand doesn't sit super well with
me because again, I got peopleup to Everest, took their
pictures, and then they're onstage being once corning
contractor of the year becausethey doubled revenue and they

(43:06):
look fantastic.
And I'm like the unkept secretin the back, and like I've kind
of always said that's okay.
So what I'm seeing, you know, Italk to a lot of these guys
who've been bought by privateequity.
We all do, you know, we knowthem.
They're our social mediadarlings, right?
They're the people thateverybody wants to know, and
half of them are coaches now,right?

(43:26):
And uh, and so we talk, and Isee like a situation where one
of our social media darlings,his like how do I say it, his uh
sidekick, right?
Right, quit the company, and allthe salespeople quit the
company, and his sidekick starta new company, and then he gets

(43:46):
to like a position where hedoesn't have to be with the firm
anymore, so he leaves, right?
And there's this concern thatlike the culture is gone, right?
And the problem I see in privateequity is that it's what private
equity always does.
It buys the company, culturesget squeezed, there's there's a
desire to always hedge the betthat they need to be able to
flip this thing at any givenpoint in time.

(44:08):
So there's this EBITDA pressureand this multiple arbitrage.
And I thought, is there a betterway?
And about a year ago, I wascomplaining about this to uh a
person who worked for me who wemet through a business broker
that was doing a deal with oneof our clients, and that
business broker introduced me tothis really smart kid who had a

(44:29):
lot of bright ideas, a littlerough rod, but you know, bright
ideas.
And I kind of just told himabout like this one percent
problem.
And he said, Why don't you takea stake in the roofing
companies?
I was like, I wouldn't know thefirst thing how to do that, you
know.
And we're putting together thisthing called a special purpose
vehicle, and essentially it'sjust a legal structure, right?
A vehicle, right?

(44:50):
And my contention is that abetter way to row in the
direction that the water isflowing, which is that
consolidation is gonna happen,right?
And that the invisible hand ofcapitalism wants that to be.
But how do you but eventuallywho it's like the US national

(45:11):
debt when it comes to this likemultiple arbitrage?
Like, who do we owe this moneyto?
Like the Decepticons?
Like, where are we gonna who dowe owe$30 trillion to kind of
thing?
Well, if you keep buyingcompanies for 3x and flipping
them for 10, and then someonebuys them for 10 and is gonna
throw somewhere in and sell itfor 13, like how many years of
net profit are you gonna buyroofing companies before before
the like it stops making sense?

(45:32):
Yeah, and I thought eventuallysomeone has to have a
hundred-year roofing mindset,like a Ford Dodge and Chevy of
roofing, like a Delta andUnited, or a Verizon and a
T-Mobile, or a Chase and a JP,uh, an American what you have um
USA Banking America Bank ofAmerica, right?

(45:54):
Um yeah, like when like when doyou have a hundred-year minds
around roofing?
Because it's a hundred-yearindustry, right?
And so this special purposevehicle, like we're taking
approach where we're going topartner with roofing companies,
and I've put together a board.
I'm not the mastermind here.

(46:15):
I was just lucky enough thatwhat I realized is smart, like
dumb money looks for smartideas, and then there are so I
had a couple of people whounderstood maybe a smart idea,
and then we've we're raisingmoney in Austin right now.
Um, but there's this conceptthat we're gonna partner with
roofing companies and we'regonna do an IPO.
We're gonna get publicly listedroofing companies.

(46:36):
So you can keep your shares andleave, you can sell your shares
and stay, you can sell some ofyour shares, the employees can
buy shares, the public can buyshares, but then you trade at
the true multiple of what thecompany is worth, not what one
private equity company iswilling to pay to acquire the
platform and what what theythink they can do with the

(46:57):
EBITDA in the next two to fouryears, because private equity's
design is to use their equity tomake their money worth more and
then liquidate it, right?
That's the job.
But I don't plan on leaving thisindustry, so how do I have a
hundred-year mindset?
And I thought, you know, I'vebeen playing in this like
service business thing for areally long time, and it's a bit

(47:18):
of a slog, you know, and I'vebeen taking a level of almost
ownership mentality over myclients' businesses and problems
without the benefits ofownership.
And so we've created a structurein which I can finally do that,
and we're literally meeting thelike the main the main partner,
like the main, the the primaryinvestor.

(47:39):
Uh, the two people on the boardare down there in Austin, Texas,
just basically finishing that uptoday as we speak.
Um and then the idea is thatwe're gonna then go and join a
bunch of RBP clients together,and then we're gonna go for a
public listing and then use thatto bring more into this
partnership.
But then we don't have to tryand squeeze the multiple for the

(48:00):
sake of a of a set date that weplan to sell the platform.
It's selling and being boughtevery single day on a on a on a
public market, and I think we'llend up buying another private
equity platform, but again, witha hundred-year mindset.

SPEAKER_03 (48:15):
And that's what there's a couple of private
equity firms that I've uh in inin seeing the you know a couple
hundred private equity firmsthat are in roofing now and
talking to some of them.
Like, yeah, it's crazy.
Um I've seen a couple that dohave a long-term mindset.
Now I've seen them execute andnot execute the way I along with

(48:39):
that vision, you know, both bothsides of the coin.
I'm like questioning some ofthem, yeah.
That's right.

SPEAKER_01 (48:45):
They're made on capital deployed, and then and
then they're left, they'releveraged to act to pay that
leverage off.
So there's a sales pitch, right?
Something you put on themasthead, but the org structure
and the capital structure couldflies in the face of whatever
the messaging is.

SPEAKER_03 (49:02):
And so and the and in the way like what you're
talking about for people thatare listening that don't
understand the private equitycycle or or or the cycle is you
know, you start withconsolidating some smaller
businesses at a lower multipleof EBITDA, and then once you
have a higher EBITDA range, thenyou're able to get a higher
valuation for that.
So you said, you know, 3x andmaybe 6x.

(49:25):
Now this company's flipping itfor 10 and maybe 15 and what
however it goes down the road.
So you're paying for 15 years ofnet profit.

SPEAKER_01 (49:33):
That's right.
At what point that's right, isthat a gamble?
At what point can you borrowenough money that you can say,
I'm gonna buy this package ofcompanies for the next 15 years
of net profit?
Like that's like the HulinxVerisk thing.
Like ICU Links has not innovateda whole lot, it traded for 34
times the net profit the next 34years.

SPEAKER_03 (49:56):
It does.
That's the same thing.
So here's the the end goalthough ends up being to go
public, and the the highestmultiples are achieved on the
public market.
So that's where that's where youknow, if you look at, I mean,
some of them are outrageous,right?
Like I don't know, I couldprobably pull up a list of like

(50:17):
the PE ratios of you know, orthe the ratios of companies that
are traded, but you know, youthink of like a Palantir that's
trading on some outrageousmultiple right now, right?
Nvidia, because they're peopleare betting on the future of the
industry in a more standard way.
You're but let's say you get toa 25 multiple, 25, 25 times

(50:38):
multiple.
That's what it's publicly tradedat.
So what what I heat what I'mhearing from you is that the
idea is, hey, let's get it tothat publicly traded type of
multiple as fast as possible.
And then as we grow it and addto it, it will just maintain
that, maintain that multiple, orwe'll we'll already be in the
best place to achieve thatmultiple.

(50:58):
Or it's I know you're enjoyingthe episode, but let's give a
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SPEAKER_03 (51:31):
So, what what I keep what I'm hearing from you is
that the idea is, hey, let's getit to that publicly traded type
of multiple as fast as possible.
And then as we grow it and addto it, it will just maintain
that, maintain that multiple, orwhat will already be in the best
place to achieve that multiple,or is that kind of what you're
gonna do?
A little bit of the mindsetbehind it.

SPEAKER_01 (51:51):
Yeah, and so then when you buy in, you're getting
sh you're getting shares, right?
Yes, it's not the roll your youroll your sale money to in into
the equity of this platform thatmight sell someday if you meet
qualification XYZ that we DOS isthe number, right?

(52:11):
That's right.
It's what's the market payingfor an industry that's recession
proof, pandemic proof, likesgrows with the rate of the
population growth, backed by theinsurance industry, backed by
the mortgage industry, andnobody wants to do the job, and
it has huge implications interms of profitability as a term
of results from AI and resultsfrom robotics, and just the

(52:32):
general market effects ofefficiency.
You know, we already saw it inthe suppliers, right?
I mean, QXO traded it like gotan 11x multiple when they bought
um BD, but like you know, wherewe saw that that they got 11,
right, when they sold to QXO.
Then the first thing Brad Jacobssaid was robotics and automation

(52:53):
uh and uh and AI, right?
So I but I but I don't when Italk to the CTO at a private
equity company about whattechnology they want, and they
heard that I was this guy thatdid technology for roofers, and
so they're like, This is what wewant, and I'm like, Great, you
and I see eye to eye, thatshould exist, and like you have

(53:17):
the money and I have thecapability, so let's make it.
And they go, We don't want tomake it, we just want you to
make it.

SPEAKER_03 (53:23):
Yeah, we don't want to make it, yeah.

SPEAKER_01 (53:24):
So that was the biggest brain shattering thing
for me.
I was like, wait a minute, youhave the opportunity to revelize
revolutionize the industry andcreate one order of magnitude,
more efficiency in the industry,and it's gonna cost you like 700
grand.
Why would you not do that?
Because no, they just becausethat's gonna kill the EBUDA.
And most of them who've triedit, have failed.

(53:46):
They've spent a million dollarson dynamics and two million
dollars on Salesforce.
They also aren't very good atit.

SPEAKER_03 (53:52):
That's a skill, that's a that's a different
business.
Development is a differentbusiness.

SPEAKER_01 (53:57):
They're not good at it and they don't want to do it,
and it would and it flies in theface of what they do.
So then that was when I waslike, they have the money, they
have the vision, they have thetalent, and they still don't do
it because they don't have ahundred-year mindset.
And I just thought, I have alike this is the industry that's

(54:17):
taking care of me and my family.
This is the industry thatallowed me to travel the world,
it allowed me to fall in lovewith America, my child's
American.
I mean, I fell in love withAmerican dynamism.
I felt I I've appreciated thelike the friendships that I've
built in this industry.
And I was just like, there needsto be a better pathway for
roofers to get that second leaseon life that doesn't fly in the

(54:40):
face of the culture and thevision and the equity that
they've built in their team andin their community.
And it really sucks when yourlast name is the name of the
roofing company, and now youkind of can't go to church
because the entire company quit,got fired, the company got
squeezed, the they're doingthings differently, they're not

(55:00):
supporting the local communitythe way they were because that's
just considered frivolousspending to sponsor the baseball
team.
That's right, you know, and thatdoesn't help the Ibada multiple
to play, you know, do the hockeything for kids or to buy the
sign at the at the soccer fieldor football field for the local
high school.
That's not that's not a Ibadahthing, you know what I mean?

(55:20):
That's a community thing.
But so to answer kind of thequestion was I think that moving
companies need to just bethinking about where what are
they building for and what istheir what is their exit plan?
Like assume that most roofersdidn't choose roofing, they
ended up in roofing.

(55:41):
So why is it that you feel likeyou need to be forever cemented
to it?
Most people, after getting outof roofing, you know, they go do
something else.
There's probably something elseyou wanted to do.
The whole like Mr.
Deeds speech, you know, youwanted to be a veterinarian, you
know, like you want to helppuppies, save the dolphins, be a
farmer, you know?

(56:02):
And it's like, what else do youwant to do?
And if you could build a greatroofing company, what would that
look like when you're done?
Is it an ASOP, right?
Employee stock ownershipprogram, is it selling to
private equity?
Is it selling to private equity,becoming the vice president of
production for the Westernstates?
You know, is it doing somethinglike RSPV and being part of a

(56:24):
company that goes public?
Is it focusing on extremelyspecialized materials and being
the craftsman roofer, stayingsmall, using AI and automation
to become incredibly profitable,you know, being a three million
dollar roofing company with twoemployees and doing a million
revenue per capita?
Is it um focusing on commercialstate and federal, becoming the

(56:46):
best roofer in the country forinstalling like there's this
thing called a Veda vent, avent-assisted design, like
basically a thing that it's likecrazy this Veda event.
The guy who owns it is supersmart, but he can't somebody
needs to go buy Vadavent fromthis guy because like he's a
cool salesman, he's a he's anengineer, he's super smart, but
he pisses everybody off becausehe's too smart.

(57:08):
But his technology is patentedand it's crazy and it's simple,
but it's really effective.
But like maybe they become thenational Veda vent installer for
those specific types of roofsthat worked for that, or the
Castagra product, you know,becoming the official, like
becoming the nationwideinstaller of that Castagra
coding and putting on all theUnited Airlines like uh things,
data centers.

(57:29):
Data centers is like massive,massive, massive, massive
opportunity in data centers.
Like you look at the size of thedata center in Texas, it fills
up Staten Island, like massiveroofs, so like all of that
that's where roofers should befocused.

(57:49):
Because if you're just countingon banging on roofs when storm
comes, like directionallycorrect, 2030.
That's probably not gonna be abusiness model you can count on,
but you can still milk it forwhat it's worth now.
But if you're not recycling thatcapital into building the
roofing company that will bearound 2030, you don't deserve

(58:10):
to be successful.
You're going to you're like, andit's you know, you have an
obligation to your team to helpcreate a vehicle for them to
accomplish their personal,professional, and financial
goals at a rate that excitesthem.
You have to have a vision thatfits all of those people's
visions inside of it.
And you know, business rewardspeople with vision.

(58:32):
You have to be looking out fiveyears and say, what does our
industry look like in fiveyears?
The government's spending$500trillion supporting AI.
You don't think that it's gonnaimpact your roofing business?
Anyways, let's I've got off mysoapbox.

SPEAKER_03 (58:47):
But no, that's uh it's a lot of good stuff, and
and and that's the I think to tosummarize it a little bit, the
thoughts are and I think peopleare already there, or a lot of
people are already there, thatthe storm restoration market is
not gonna be what it is.
There's going to be a very bigshift in the way that that that
that roofs are gonna beinstalled probably in the next

(59:10):
five years.
There um but that craftsmanshipis not going away.
I was just I just noted I heardsomeone talk about it today.
You know, there's still thesethings called newspapers, Adam?
They still they you could stillbuy them.
I didn't even like you couldstill go and buy them, but
they're like four bucks orsomething.
They're like four or fivedollars or something like that.

(59:30):
Like, but they're it's a uniqueexperience that some people
want.
They want to read a newspaper.
There's a there, you know,there's still people that
advertise on the radio and on,you know what I mean?
Like there's still things thatthese things that we felt got
antiquated, and you know, thatthat's not the we're looking so
close into these newtechnologies in the future that
a lot of these things stillexist.

(59:52):
The custom cabinet maker, thecustom, right?
There are still craftsmen thatdo these really cool things.
So figure out who you You areright.
Also, I another thing I heard isyou could play you could play
the game the way it's going.
So you could become a version oflike what you're working on,

(01:00:12):
right?
Is become a version of thatmodel, the a a better version of
the private equity model, abetter version of utilizing the
capital markets in your roofingbusiness.
Now let's talk about what techlooks like.
Um I sent you a video and Idon't know if we got a chance to
look at it or not, but like youmentioned to me is kind of the

(01:00:32):
exact same philosophy or kind ofthe same the same way that that
video was framed is that, andthis is what it so I I come from
web development.
So I I I my degrees inmanagement of information
systems, so I'm like halfcomputer science, half business
administration.
So I'm not a 100% geek, I'm onlyhalf geek.

(01:00:53):
Um, you know, like but Iremember sitting in college in
the early 2000s, and 2001, 2, 3,4, I graduated in 2004, and this
was like this this cell phonething was crazy.
Like we were talking about whatif this was all in in kind of

(01:01:16):
this was a dream of a device?
Like what would it look like?
And what would it be like?
And what is this, you know, ifyou had all of the information
at your fingertips like that?
That was then it it, you know,what does the next iteration
look like?
Because for what when I started,it we were building the
websites, right?

(01:01:36):
And you had to go to thewebsites to access the
technology, or you had a uh alocalized application on your
computer to access technologythat didn't talk to anything
outside of your computer, right?
Then we moved on to things thatare in the cloud and they're all
talking to each other and it'sall web-based and it's really
cool, and then all of a suddenthat moves to the apps on your

(01:01:58):
phone and everything'sintegrated.
Where does this go?
What is a what does a CRM looklike?
What does the tech stack looklike in 2030?

SPEAKER_01 (01:02:10):
So there's uh Darmesh Shaw, who's a pretty
smart guy, um, you know, initialinvestor in OpenAI, founder of
HubSquad, smart dude.
Um, he had this statement hesaid from stage, and he said,
like, he posted something up.
I can't do it because he had thebenefit of a slide, but he said,

(01:02:32):
What do you think when you readthis statement statement and
say, How do you compete with AI?
And I tried not to inflect mywords, but it says like 50% of
the room sees how do you competewith AI?
And other people see, how do youcompete with AI, right?
Um, and we're in this weirdphase right now where there's
the tip typical technologyresistance.

(01:02:55):
Um, but again, we have to bedirectionally correct.
So for right now, when you havean AI voice agent, problem if
you get into this business, andI like I know you do too, you
you listen to the recordings andyou get people who are like, I
don't do AI, and they hang up.
When they see an Amazon robotdelivering a package to a door,

(01:03:16):
someone's gonna trip the thing.
The CEO of Waymo says that theyhave seen so much data at this
point that they can tell youwhich regions of which cities
have a higher propensity forpeople to jump on the hood of a
Waymo coming to a stop and tryand pull like an insurance scam
on it.
It's like they got 27 cameras onthe thing, but that's how dumb

(01:03:39):
people are.
The Waymo hit me, and it's like,no, you jumped on the hood of
the cock and then rolled offinto the crosswalk.
But and then people mess withthem and put traffic cones in
front of them, right?
So you're gonna see this likeebb and flow of businesses
experimenting with it and thenkind of getting smacked in the

(01:04:00):
face, but you have to be durableand you have to go through it.
And I think that the future ofroofing, especially in the
retail market, is going to bee-commerce.
I think you probably heard thestat 57% of Google searches now
do not result in a click.

(01:04:20):
So people don't want 10 bluelinks, they want the answer.
And so I think as we go fromseeing companies um put AI on us
as a um like, oh, like right nowit's like, oh, we're being we're
having AI pushed on us, right?

(01:04:40):
And they're they're resistant.
But then when AI starts to worktoward them, right, and Google
figures out how to deal with thefact that pay-per-click is being
crushed, right?
And how to how to kind ofrespond to that, you're going to
see people go, oh, I can use AIto help me, right?

(01:05:02):
And then it's going to be, ohAlexa, I have a roof leak.
Can you book a roofer to comelook at my house?
And then it's gonna be like, Igot three quotes, which one
should I pick?
People are deferring theirintelligence to this thing.
The fear is that this thing isgonna stop us from knowing how
to think, and you have to, ifanything, you have to count on

(01:05:25):
people to be lazy.
So, in a world where you counton people to be lazy, what is
the laziest way to buy a rooffrom you?
And so I think that uh you'regonna see zero-click websites,
right?
Like you're gonna have there'stwo technologies that came out
that kind of justify my theoryso people can Google it.
And like, this isn't just mebeing like some you know utopia

(01:05:49):
nerd, but two technologies cameout.
One last November was MCP, modelcontext protocol.
Think of it like API 2.0.
It's essentially if you want anAI thing to do something, you
had to tell it like thisendpoint is add a contact, this
endpoint is created note.
You had to like teach AI how touse the software, and depending

(01:06:10):
on how good you were, you wouldbe like your AI agent would be
good or bad.
Well, then they came out withthis thing called MCP, model
context protocol.
And all it is is giving thelarge language model, right?
The chat GP, the open AI, LLM,or Grok or Gemini, is it or
whatever context of how this ofthe protocols in which you
interact with a particularsoftware.

(01:06:32):
So software can say, here's theMCP.
Now anybody can connect an agentto it and it knows how to run
the software.
The second thing came out inApril from Google.
So the first one was Anthropic,the makers of Claude.
The second one was Google inApril, something called A2A,
agent to agent.
It was a protocol for agents tobe aware of other agents.

(01:06:54):
So what does this look like inreal life?
Well, if a sales rep at aroofing company goes to his
sales manager and says, Hey,what's my commission?
10%.
Um, when do we when when do weget paid?
When we get paid.
Uh, what is the best shinglethat I should sell to this
customer?
Owens Corney.
What is the pay date for mypaycheck?
I don't know.
What is our 401k plan?

(01:07:14):
I don't know.
But if you go two doors down thehall on the left, you can talk
to Brenda.
She's the HR manager, and shecan tell you that.
So the sales manager agent,human, knows where the other HR
agent, human, is and knows howto send them there to go deal
with that thing.
So the only difference is theAI, you'd have one input-output

(01:07:37):
mechanism like a chat window ora voice call or website, and
that agent would be aware of theother agents that exist on that
network to say, Oh, I can'tanswer this question, but that
agent can.
Let me ask that agent and answeryou.
And so what that means is thatwhen your personal agents, as

(01:07:58):
people, get their own agents,which is their Alexa, their
Siri, their Google, whatever theGoogle one's called, right?
They'll just say, I need a roof,or call the roofer and tell them
that I want to buy the roof,right?
Or I need to call the roofer andtell the repair that they did is
leaking, right?
Or all of a sudden, you're gonnasee, just like we have

(01:08:20):
robots.txt on our website, we'regonna have agents.txt or some
agents.json on our page thatjust says, hey, if you're
visiting this website from ChatGPT operator or perplexity
comment agent thing that theyhave in their comment browser,
if you're visiting this websiteas a robot, let's just work

(01:08:41):
together and I can take care ofyour user's request.
You don't have to navigate allthe pretty UI that gym and the
team built with the bubbles thatfloat and the mind, the things
that glow, and what you don'thave to deal with all that.
If you want to just book yourboss an appointment with my
boss, the roofing company, I canjust handle that for you and
let's just work that out.
When is your homeowner, yourboss, when are they usually

(01:09:04):
home?
Well, they're usually home aftersix.
Is the wife usually home?
Because it's usually good.
Actually, I can see that yes,his wife is usually home, but on
Thursday, they take the kid togymnastics, so the wife won't be
there.
The best time for me to actuallydo this if you need the wife
there will probably be Friday.
And then this homeowner is justgonna end up with a calendar
booking because they asked theiragent to book them an
appointment with a roofer.

(01:09:27):
So it will do all contextprotocol, agent to agent, human
beings, homeowners, consumers inthe world starting to see agents
as helpful to them, and theystart to be empowered to have
their own counterbalancingeffect.
Because right now, if you callthe roofing company, you have to
talk to the AI, depending on howgood it is, you might tolerate
it.
But if you just said, hey Siri,phone a roof, phone three

(01:09:49):
roofers and get me someestimates for a roof, then now
those two agents don't even needto speak English to each other,
they can just speak JSON.
Yeah.

SPEAKER_03 (01:10:00):
And they and then they can take, they can initiate
the conversations, take theinformation, uh, evaluate the
estimates, and just schedule thething for the homeowner where
the homeowner doesn't even needto be involved at all.
They don't even have to make adecision if they don't want to.
If they have said, agent, make adecision for me on which company

(01:10:22):
to go with, it just makes thatdecision.
Um it that that's that's thething.
It's the the the way you won'tsee tech.
I mean, there's so much tech inour world right now that we
don't see, but it will becomeaccelerated in a in a in a great
way, man.
This is awesome, man.

(01:10:43):
This has been a lot.
Yeah, it will work for us.
It'll it's gonna be there's someexciting and scary times ahead.
We'll see how it goes, man.
Um we'll we'll get to look backat this and see if any, you
know, how right or wrong wewere.
Um, or we'll just have ouragents look back and and
determine if we were right orwrong.
Adam and what uh how can peopleget a hold of you, you know, get

(01:11:07):
in touch with you, you know,communicate with you, get you
know, start to be involved in inyour content that you put out,
um, and then what what's a finalthought that you can share?
Like how do uh you know, if youwere that, you know, if you if
you were like, yeah, I really II really need to move in the

(01:11:28):
direction of this, of whatroofing looks like in 2030,
what's that what's that simpleadvice that you could give?

SPEAKER_01 (01:11:39):
Make decisions on the longest possible time
horizon.
That's awesome.
Cool man, how can people get ahold of you?
Yeah, so um Adam Sand onFacebook.
I'm very, you know, the roofingcommunity is there, so I'm
there.
Uh and of course, just reachingout through our website,
roofingbusinesspartner.com.

(01:12:00):
Uh, I host um free webinars fourhours a week.
So I'm always there to just aska question for free.
You know, like I like tocontinue to hear the voice of
the customer and the voice ofthe industry.
And so I do those.
There's no gate behind it.
You just go to our website andjoin one of them.
So there's one almost everysingle day.

(01:12:22):
Just join one.
Those will be the three bestways to like get in touch
Facebook, go into the website,or just join a webinar and bring
your question.

SPEAKER_03 (01:12:32):
Awesome, man.
Thanks for your time today.
This has been another episode ofthe Roofing Success Podcast.
Thank you for tuning in to theRoofing Success Podcast.
For more valuable content, visitRoofing SuccessPodcast.com.
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(01:12:53):
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