451 | My $7 Million Dollar Loss Made My Business Bigger

Apr 15

[00:00:00] Chaz Wolfe: I've thought I was having heart problems. And so here I'm like, okay, but I need to keep this life insurance. Cause if I, if something happened, yeah, I gotta have a way to cover it. I mean, that's the type of stuff that was literally going through my head as I was making these drastic changes and cuts. So there was one story that someone was telling me.
[00:00:17] Chaz Wolfe: The person said like, yeah, man, it is really bad. Doesn't look good here, but I believe in Ryan a hundred percent. And to hear someone tell me that, that's just. Jet fuel to my tank. I mean, there's no doubt in my mind that we are going to be wildly successful. We want to disrupt the construction industry by, you know, being a people first company and empowering
[00:00:41] Chaz Wolfe: What's up everybody. Welcome back to gathering the King's podcast. I am your host, Chaz Wolf, and I just wrapped up an incredible conversation with our guest and King of the heavy civil construction industry, Ryan Schmidt.
[00:00:54] Chaz Wolfe: We talked about his valley of darkness, where it was rough, rough, and he lost millions, but it was worth it. We talked about what it truly means to have a people first company. And we also talked about giving back to the community.
[00:01:05] Chaz Wolfe: And I know that if you are a business owner going through it right now, and you know what I mean by it, or if you're just looking to build some grit when it comes to a tough time in your business, this conversation is for you and it is going to be extremely valuable. Make sure that you subscribe, hit the like button, maybe put a little comment down there for me.
[00:01:23] Chaz Wolfe: Tell me that you like this stuff because it literally helps us continue to bring on incredible guests and I appreciate you and joy the show.
[00:01:34] Chaz Wolfe: How are we doing Ryan? Good morning.
[00:01:36] Ryan Schmitt: doing great. Glad to be Well, I appreciate you being here. ~Um, ~this is going to be a fun show. They're always fun, but you've got a, a,~ um,~ as they say in today's world, a boring business,~ uh,~ the industry wise, maybe, but you are doing amazing and super exciting things and, and I want to get into it. So tell us what kind of business do you have?
[00:01:54] Ryan Schmitt: Yeah. So, ~uh, ~I own a heavy civil construction firm. ~Uh, ~we're located in Jacksonville, Florida, kind of do work in Northeast Florida and Southeast, depending on the type of projects. But yeah, we self reform,~ uh,~ heavy civil construction scopes, primarily focusing on public. Roadway and utility infrastructure, private site development and construction and then water and wastewater treatment plant construction.
[00:02:21] Ryan Schmitt: ~Um, ~we largely self perform a lot of that work and, you know, have currently about 230 employees that,~ uh,~ you know, between. Estimators, project managers,~ uh,~ you know, superintendents, foremen, and then skilled trades to keep it all going. And,~ um,~ yeah, I've been in business for, will be 17 years,~ uh,~ uh, later this fall.
[00:02:43] Ryan Schmitt: So not real old, but not really young. And,~ uh,~ But, uh, we'd really enjoy it and really focused on,~ uh,~ just growing the company,~ uh,~ around our people and our culture.
[00:02:54] Chaz Wolfe: And I know we're going to talk about that quite a bit here today. ~Um, ~and you've even got a, a newer development going on,~ um,~ inside of your company that we can get to talk about here today, but 230 employees,~ um,~ you know, you're doing huge projects. ~Um, ~was that from day one? You just walked right into that or, or was this a long term 17 year progression?
[00:03:15] Ryan Schmitt: So it was an interesting progression. So I had been in this industry prior to starting this company. I worked. For another company for almost 17 years. And then when I left there, I wanted to do something on my own. I wanted to,~ um,~ you know, build a company that,~ uh,~ I knew that,~ uh,~ we could build and around a particular culture.
[00:03:33] Ryan Schmitt: ~Um, ~so we started out in 2000, officially started in 2007, but really kind of got going early in 2008. And I bought the assets of a company called Petticoat Contracting that had Been around for almost,~ uh,~ 18, 19 years at the time and,~ uh,~ had a nice little business. ~Uh, ~the woman who owned it, I had known for many years, we served in some leadership roles,~ um,~ that,~ uh,~ served our industry and,~ um,~ and she had fallen ill and was looking for an exit strategy.
[00:04:03] Ryan Schmitt: And,~ um,~ we kind of got together the same time that I, I'd left,~ uh,~ didn't really plan it, didn't know That option was really there, but very kind of serendipitously, we kind of got together after I departed my previous employer and came up with a plan where I would buy the assets for a company and would honor her by keeping the petticoat.
[00:04:25] Ryan Schmitt: And the name, and so I set up petty coach Schmitt separate from her company, which was petty coat contracting. And,~ um,~ over about a year, we, you know, gradually brought her people over as, as they wound down their work. And I bought specifically just the assets that I needed and whatever I didn't buy, they sold.
[00:04:44] Ryan Schmitt: You know. third party or, and ~uh, ~so there was a, it was a transition that lasted about a year and literally started out by renting, you know, three cubicles in her office,~ um,~ and just starting to bid work. And we picked up work and started it about the time that they were winding down their work. So it was a great transition,~ um,~ especially in the middle of the great recession, this is 2008 and nine.
[00:05:10] Ryan Schmitt: ~Um, ~she had a lot of. Pre recession work,~ um,~ that she was able to complete and very profitably because as she got closer to completing that work, I absorbed more and more of her overhead. So she was able to really,~ uh,~ profitably close out a company,~ um,~ in the middle of the recession that you might not.
[00:05:31] Ryan Schmitt: Otherwise happened and we were able to ramp up lean and mean, we only had the equipment that we needed and we brought over her people and we were able to successfully get some nice infrastructure contracts right off the bat and actually,~ um,~ did pretty well during those recession years and,~ um,~ and,~ uh,~ started up and, you know, I grew the company from there.
[00:05:51] Ryan Schmitt: And it's, it's funny, I was telling the story the other day, you know, everyone talks about their entrepreneurial hardships of getting started in those first few years and,~ um,~ our first few years, I mean, trust me, I, you know, we worked hard, everyone really worked hard, but,~ uh,~ I think our real headwinds came about seven or eight years in.
[00:06:10] Chaz Wolfe: Yeah. And I want to get to that,~ uh,~ for sure. I think it's super unique about how you started. There are plenty of businesses and,~ uh,~ or business owners rather that start by purchasing. I know I did,~ uh,~ I've since started a few, so I've got kind of a taste of both, but this transition really, what I heard you say, a win win.
[00:06:26] Chaz Wolfe: And I even heard you use the word honor. You wanted to honor her with the name. And it even sounded like you were trying to honor her. You got actually excited as you were telling me about how she exited profitably, almost like you were wearing that like a badge. Like I helped her do that. I'm just hearing like, win win,~ uh,~ honor.
[00:06:42] Chaz Wolfe: Like, is, was this important to you back then? Were you thinking about this consciously? It's just kind of just who you are. Give us a little insight there.
[00:06:47] Ryan Schmitt: Yeah, gosh, I would, you know, I would say, yeah, I mean, that's how I am. ~Um, ~and well, yeah, I was thinking about it and it's, that's kind of something that I guess just comes normally. I mean, she was, you know, a colleague and a friend 1st and foremost, and, and I've known her, her family. ~Um, ~her, her team and,~ um,~ you know, just really wanted to do this in a fashion that, you know, she was able to,~ um,~ get the most out of it.
[00:07:18] Ryan Schmitt: She could,~ um,~ and we could, and definitely a win win and, you know, yeah, I was, I was very proud that, you know, she was able to exit her company. In a, in a, in a terminal illness situation during the great recession, but had a successful exit really. And so, yeah, I was real proud of that. And,~ um,~ you know, and I look at the, the culture and the fabric of our company and it's part of that.
[00:07:47] Ryan Schmitt: It's part of who we are. And,~ um,~ we were able to, you know, leverage the reputation and name of her, her company. ~Um, ~and I was able to leverage the reputation of my in the industry. And so we were able to start up Petticoat Schmidt and I think everyone did really well with it. And we were able to move and move forward and leverage, I think, not only her reputation, their company's reputation, but some of the thing I had done previously and reputation that I had.
[00:08:18] Ryan Schmitt: So it worked really well. And,~ um,~ yeah, I was really. ~Um, ~you know, she wound up passing,~ um,~ some years ago. And so, you know, I was very proud to know that we, we were that instrumental on helping her and her, she had a daughter that, that was able to, you know, transfer her estate and wealth,~ uh,~ in a fashion that,~ uh,~ you know, during, during some pretty rough economic times turned out pretty
[00:08:41] Chaz Wolfe: Yeah. Yeah. I just think that there's an opportunity there for the listener to,~ uh,~ challenge themselves and ask themselves, are they looking for win wins,~ um,~ that negotiation opportunity that you went through could have been,~ um,~ you know, pretty, pretty hard nosed, right? She's, she has limited options.
[00:08:56] Chaz Wolfe: You probably could have squeezed her. ~Um, ~most probably would have. And so I just, I think it's just a really cool opportunity, not only just to honor you in the moment, but to show how win wins,~ Um,~ and we don't have to be, you know, the backstabbing, you know, squeezing a business owner that everybody thinks that,~ uh,~ you have to be in order to win.
[00:09:16] Chaz Wolfe: ~Um, ~and so I appreciate your, your perspective there. I want to get to how that fabric is into your culture, but let's talk, let's just kind of fast forward a little bit. You said you came into some headwind, you know, six, seven, eight years in. ~Um, ~and it was probably a little bit more than a headwind based on,~ uh,~ some of the things that I've heard you talk about previously, but,~ uh,~ Everybody has those, those moments.
[00:09:34] Chaz Wolfe: You've, you've called it a valley of darkness,~ uh,~ is what I've heard you say, talk, what, what was this valley of darkness for you? What did it look like?
[00:09:40] Ryan Schmitt: I look back on it now and it definitely was something that impacted us, but it really made us who we are today as an organization and definitely who I am as a leader. So going back to 2016,~ um,~ we had grown pretty substantially since we started in 2008, really was kind of our first year in business.
[00:10:05] Ryan Schmitt: ~Um, ~and we were doing some nice size projects and we had grown. With,~ uh,~ you know, we were over 200 people and we had done some projects. ~Uh, ~you know, we did some dot projects,~ um,~ in the history of the company and I'd always done that, but we had a few projects starting about 2016 and then 17 that were larger projects that came across some real issues, issues that were outside of our control and responsibility, you know, ~um, ~you know, And not to get too much contractual detail, but, you know, differing site conditions and poor design,~ uh,~ there was a couple large ones with the D O T.
[00:10:47] Ryan Schmitt: And then there was 1,~ uh,~ water treatment plant project that,~ um,~ it was with a smaller municipality that all of them had little issues that turned into big issues. And the,~ uh,~ The client that took the route of a very adversarial route and instead of working on us with us to try and help resolve it, even though it was their responsibility,~ um,~ kind of forces in a situation where we had to take legal action.
[00:11:17] Ryan Schmitt: So, you know, going into 16, we kind of. Had a few of those going and didn't make any money at 17 really didn't make it just break and even, which is not a healthy environment for a business. Then in 2018 lost a lot of money, a lot of money. And then,~ uh,~ so. You know, some pretty substantial things happened. I mean, basically lost our bonding.
[00:11:40] Ryan Schmitt: I had to recapitalize the entire company. I,~ um,~ had those sleepless nights where I was staring at the ceiling and just, you know, when I kind of realized where we were going in the, the, the light at the end of the tunnel was a, a, a train. It was, it was not us coming out of the tunnel. And fortunately I had some colleagues in a business group that they were the first ones I really just,~ uh,~ you know, kind of disclosed and said, guys, it's bad.
[00:12:11] Ryan Schmitt: So, you know, and it was awesome. They, they, we kind of had an emergency meeting and they gave me some wise tips moving forward. Probably the biggest one is like, have you told your wife yet? I'm like, no, I haven't told anyone. And so they're like, well, go home and tell your wife. And, and I did, and I was like, Hey, we can lose everything.
[00:12:33] Chaz Wolfe: yeah.
[00:12:33] Ryan Schmitt: And she's like, well, as long as we're together, that's all that matters, which was believe it or not, just a great day for me. Just that was about the kindest words I could have ever heard. ~Um, ~and then, then I just got busy trying to fix it, you know, and,~ um,~ again, I had these strong,~ uh,~ colleagues that were peers, business owners, and, you know, actually had 1 of them that, you know, Let me a substantial amount of money.
[00:12:56] Ryan Schmitt: You know, I had to collateralize the loan with some assets that I had, you know, and then any other asset that I had that had any equity or value to it. I sold.
[00:13:07] Chaz Wolfe: Yeah.
[00:13:09] Ryan Schmitt: And then recapitalized the entire company, refinanced our fleet of equipment and basically,~ um,~ did whatever I could to wake up every day and walk into the punch and fight through these situations that were going,~ um,~ with these jobs that were just really,~ um,~ a huge, huge headwind of a company.
[00:13:31] Ryan Schmitt: And then just got busy figuring out, okay, well, what, what do I have to do to get through this? Because there, there's no other option. I mean, there's just, I'm all in, right? There's no option. There's no, like, I give up or quit as you will know, being a business owner, you got to solve the problem. So then it was just a massive, Effort to, okay, what are the, how do I get better as a business?
[00:13:52] Ryan Schmitt: How, what do we do? I looked at our leadership team. I looked at, you know, our processes, we adopt the entrepreneurial operating system, EOS, which you might've heard of,~ um,~ the great game of business,~ um,~ complete transparency with a company. We, and still to this day, share the financials with everyone in the company.
[00:14:10] Ryan Schmitt: We project our financials. Every Monday at three 30 when we have our entire company huddle. And, you know, during those days when we were really,~ um,~ really, really looking bad,~ um,~ we did not have anyone jump ship. And I, you know, it was wasn't from me hiding the truth. I, it was very clear and transparent of what was going on.
[00:14:30] Ryan Schmitt: ~Uh, ~we shared the financials. But I got busy of putting better processes in place. We very much cleared up who we wanted to work for and who we didn't want to work for, who we needed on the team. We had to make some tough changes and We, you know, just fought through
[00:14:51] Chaz Wolfe: Yeah.
[00:14:52] Ryan Schmitt: uh, implemented some,~ uh,~ profit sharing type,~ uh, uh, um, ~programs, both of the project level and the company level that, you know, everyone saw.
[00:15:00] Ryan Schmitt: And, you know, when we got out of this, that there was a path where people could do really well. And so, you know, 18 was a huge, huge loss. ~Uh, ~and again. You know, lost our bonding and fortunately having a relationships and reputation in the industry. I, like I said, I got some personal loans outside the business, got some bank loans, went deep into our line, had a great friend in the surety industry who had a small surety who helped us cobble some, get her some small surety lines that we could at least bid some small stuff.
[00:15:33] Ryan Schmitt: And, and then we had to focus on more on some. Unbonded work and just muddling our way through looking at every single dollar, just really struggling with cashflow and,~ um,~ but made our way through and we're kind of coming out in 2019. We kind of got our way up to at least breaking even again. But we really saw some of the momentum of these changes in these processes.
[00:15:59] Ryan Schmitt: And I knew in my heart, I'm like, man, we could really do some great things here. ~Um, ~and then Covid hit,~ um,~ as we were coming out of it and that, that set us back on, on especially some of the private work that we were doing. ~Um, ~but I tell you, thank God for PPP money. ~Um, ~if we didn't get that, we probably wouldn't be talking today.
[00:16:19] Ryan Schmitt: ~Um, ~and every bit of every single, those dollars went into keeping us afloat and going.~ Um, ~and then. You know, we gradually improved our bonding situation, got,~ um,~ some bigger and bigger bonding lines,~ um,~ paid off the, some of the debt that we had taken. I paid off the outside lender, a friend of mine that,~ uh,~ lent me a substantial amount of money.
[00:16:41] Ryan Schmitt: ~Um, ~you know, got out of our line,~ uh,~ really got some, some footing back. And, you know, but then I look back, you know, it's like, man, between the actual losses and then the opportunity cost. that number was equivalent. And I did the math of like, see what it is to, what does it cost to send the kid to Harvard?
[00:17:01] Ryan Schmitt: Okay. I need to be about smart as 20 of those or 200. I'm sorry. ~Um, ~200 of those, cause that's, that's the order of magnitude that, that,~ uh,~ I had to make up and, but instead of focusing on, you know, what we missed out on is like focusing on the future and what. What kind of company do we have to be to leave that in the back background, leave that behind us and build a great company that just dwarfs that whole valley of darkness that we went through.
[00:17:32] Ryan Schmitt: So between, you know, really adopting the great game of business philosophies of open book management, sharing those dollars,~ um,~ sharing the profits of the company,~ uh,~ building,~ uh,~ When I say a people first company, I mean, we are a robust people. First company. We've got a full time training and development manager.
[00:17:53] Ryan Schmitt: We've got career path curriculums. ~Um, ~I was just in ST louis last week with some other like minded contractors going over. Workforce training and development in the heavy civil,~ um,~ industry. ~Um, ~and,~ uh,~ just, and it's, we've started to get that momentum and we've come out of that valley of darkness. And, you know, it's funny, as painful as it was, I was,~ uh,~ at a conference last year and got, I got a question that caught me off guard.
[00:18:21] Ryan Schmitt: I was with myself and. Our president and someone said, well, what was your most impactful project? And I just, without thinking spit out the one that was the one that lost the most money that was at the very bottom of the valley job that lost probably about 7 million just in that one job. I just spit that one.
[00:18:45] Ryan Schmitt: I didn't even think about it just came out of my mouth. And, you know, our president, he kind of looked at me and I'm like, yeah, I mean, if it wasn't for that job, we wouldn't be where we are today. And we're in such a great place. You know, I see the impact of the lives that the people that are coming to work for us,~ um,~ you know, they're, they're being treated and that they're working for a company that's very unique.
[00:19:06] Ryan Schmitt: ~Um, ~it's affecting their family lives. ~Um, ~it's affecting their future. ~Um, ~you know, we're, we're. We're sharing in the profits, but, but sharing and everything else too, the information of what's going on. We have a, of 230 people, we have a company wide, like seven to eight minute huddle every morning with everyone, and we're going over lessons learned and shout outs and put it on a company app.
[00:19:29] Ryan Schmitt: And we've got a online training platform and,
[00:19:32] Chaz Wolfe: That's cool.
[00:19:33] Ryan Schmitt: and probably the pinnacle of it, of where we're going this year in, in about three months, we're. We're in the middle of the process, but we'll close the transaction. Probably in June is that we're going to an ESOP where I'm selling,~ um,~ a portion of the company to the employees.
[00:19:50] Ryan Schmitt: And then the ultimate goal will be a hundred percent ESOP company.
[00:19:54] Chaz Wolfe: Hey Kings and Queens, Chaz Wolf. I want to talk to you about something that's super important to me. We put a lot of time and effort, we meaning myself and my team into this podcast, into the content that goes out every single day. And if you have been getting any sort of value or insight from this, we want it to be able to reach other business owners too.
[00:20:13] Chaz Wolfe: So we would love if you would like. Comment, share, leave a review, post, share again, all of the things on social media, on all the different platforms, or even on the podcast mediums of Apple and Spotify, we would love to be able to get our content into more hands, more entrepreneurs, so they can grow their business as quick as possible.
[00:20:33] Chaz Wolfe: Together. We are building a community of like minded entrepreneurs who are committed to growing their businesses to new heights. So let's do this. Let's help each other. Let's help each other grow.
[00:20:44] Chaz Wolfe: what a, what a pinnacle in all seriousness. I mean, from the beginning, you had this people first thought from back in your story a few minutes ago at the beginning, even taking good care of your people. And even, even actually the previous owners, people, you, you kind of took pride in that even. And so for you to be able to come to this pinnacle is probably pretty special.
[00:21:02] Chaz Wolfe: I want to, I want to press into that a little bit, but my question for you first from this valley of darkness is, You as the owner or as we say on the show, you know, a king carrying the weight, you know, the weight of the Valley, the weight of the crown, weight of responsibility, like all of those things, especially during that time, just really heavy, like really, really heavy, like heavier than all of your equipment.
[00:21:24] Chaz Wolfe: ~Um, ~and And you obviously not only pulled it out, but you've pulled it out in such a way to where now hundreds of other people get the benefit, not just even you, but hundreds of others. What was the strength? You mentioned a group of guys that are around you, our business folks, you, you, you mentioned your wife.
[00:21:44] Chaz Wolfe: What were some of the pieces there that gave you that strength or courage and, or maybe even belief you've talked about? I still believe we could do something special. Why was it like that? What gave you that courage?
[00:21:54] Ryan Schmitt: Yeah, that's a, that's a great question because yeah, it was overwhelming stress. ~Uh, ~as I mentioned, I mean, I looked at every single dollar that, that We could cut or I could, I could liquidate. ~Um, ~one of them was, you know, I've got this,~ uh,~ insurance plan through the business that, you know, it's kind of like key man insurance in the event that something happens to me, the company is taken care of.
[00:22:18] Ryan Schmitt: It'd been in place for a long time. Well, I was cutting every single dollar and I was like, well, we'll just cut that out then. I'm like, well, I've got these chest pains that are really, I'm like, I'm I'm thinking I'm going, I'm like, well, let's cut back to the bare minimum. I can keep that because my physical health was in question.
[00:22:39] Ryan Schmitt: I mean, you know, fast forward now, I realized that was stress manifesting itself and just the physical. You know, the physical pain. But,~ uh,~ you know, I thought I was having heart problems and so here I'm like, okay, but I need to keep this life insurance. 'cause if I, if something happens,
[00:22:57] Chaz Wolfe: Yeah. I gotta have a way
[00:22:58] Chaz Wolfe: to
[00:22:58] Chaz Wolfe: cover it.
[00:22:58] Ryan Schmitt: to make sure everyone is taken care of, my family and, and this company.
[00:23:02] Ryan Schmitt: So, I mean, that's the type of stuff that was literally going through my head as, as I was making these drastic changes and cuts. Then it's like, okay, well. I got to move forward, you know, literally thinking every morning, like wake up, walk into the punch, walk into the punch. And, but then, you know, I, I saw the value of relationship time and time again, really come out like, you know, that, that first person who reached out to me.
[00:23:32] Ryan Schmitt: And when I told him and he was part of my business group and literally saying, how much do you need? I'm like, I need 2 million. And I didn't even know if that was the right number. And he's like, okay, all right, let's get to work on how we do that. And, and granted we structured a, you know, loan and interest and collateral.
[00:23:53] Ryan Schmitt: But, I mean, and, but he said the only reason, cause he's like, right. I know you, I know your abilities. I know your character. I know your business acumen, you know, he was all in.
[00:24:03] Chaz Wolfe: Yeah.
[00:24:05] Ryan Schmitt: And then another, you know, someone who, you know, helped me out with the surety situation all in. I mean, he was one of my previous surety left me.
[00:24:13] Ryan Schmitt: I called this guy at night. He's like, I'll be in your office tomorrow morning.~ Uh, ~and then our leadership team, I mean, golly, those people, I mean, they were, there were some days where I felt overwhelmed and they showed strength for me, quite honestly, on some of those days. And they were. All and they easily could have gone to work somewhere else.
[00:24:33] Ryan Schmitt: It wasn't like we were in a recession and every company was struggling. We were struggling. Everyone else was hiring and really doing pretty good. So, you know, just the loyalty and conviction and. relationships that, you know,~ uh, ~you know, it really lifted me up, really inspired me,~ um,~ you know, many times I thought, wow, I am not deserving of this.
[00:24:57] Ryan Schmitt: I mean, I'd heard, you know, there was one story that someone was telling me that they were meeting with someone else. And,~ um,~ the person said like, yeah, man, it is really bad. It doesn't look good here, but I believe in Ryan a hundred percent. And to hear someone tell me. That,~ um, uh, ~that just like, well, that, that just, you know, that's just jet fuel to my tank and just was like, I, this is, I mean, there's no doubt in my mind that we are going to be wildly successful.
[00:25:26] Ryan Schmitt: And so it just fueled me up, you know, during some of those days where we're. Really dark and bleak and sometimes didn't know what was going to happen, but you just said, well, I got to keep going. I got to keep pushing and then coming out of it. And then we start seeing the progress and we start seeing the rewards of,~ uh,~ the financial awards that we're sharing with people through different incentives.
[00:25:51] Ryan Schmitt: And now the ESOP, it just, it's beyond fulfilling and, and it's got me convicted that,~ um,~ You know, a people first company. And so literally right before I got on with you, I was with a new hire class and I'm at every single new hire orientation. Every single person that comes to work in this company. I'm with him for the first 2 hours and I walk through.
[00:26:13] Ryan Schmitt: Well, one, I want to get to know, I'm telling you about your, your family, where you're from, your kids, what are they into? What are you into? What do you like to do? Every single person,~ um,~ we go around the room and I share the same thing and I share the history of the company and, and,~ uh,~ you know, what we've done and where we are and then the culture.
[00:26:30] Ryan Schmitt: I walk through every small, tiny component of the culture. And then our, we share our business plan with the entire company. The U. S. They call it the Vision Traction Organizer. We call it the play in the wind. I walked through the entire detail of it with every single person. ~Um, ~and then I talk about, you know, how we do share the profits of the company and you know, how we can be successful.
[00:26:53] Ryan Schmitt: And, and then,~ uh,~ we talk about,~ uh,~ the ESOP as well too. And, and,~ um,~ so it, that just between going through that valley of darkness and seeing what it took to get out of it. ~Um, ~you know, I've consumed more business books probably than most people out there and between that and then just seeing the result and the impact of being completely people focused, other people focused,~ um,~ it's got me inspired to really take our company to where we're not only doing things different as a company, that we're going to disrupt the industry.
[00:27:26] Ryan Schmitt: And that's kind of our vision. We want to disrupt the construction industry by, you know, being a people first company and , empowering, people and allowing them to grow.
[00:27:35] Chaz Wolfe: Yeah.
[00:27:36] Ryan Schmitt: And we've really got a robust training and development department now that, you know, we wanna find out what people want individually and, and tie their personal goals to what the company is doing and where we can do that.
[00:27:49] Ryan Schmitt: And you know, man, that I, you know, I talk about. you know, my little saying during the new higher orientation is like, I want people to be so inspired by what we're doing and have the opportunity to think about not their paychecks, but you know, what are they going to put on their jet ski? Is it going to be a flame or a lightning bolt?
[00:28:09] Ryan Schmitt: You know, I want those type of decisions to be running through their heads, right? And so, And create that opportunity here where, no matter where you are in the position to have that.
[00:28:18] Chaz Wolfe: That's cool. I mean, obviously the end result,~ um,~ of, of people first, you kind of just defined it as being able to attach their wins, what they think of a win or what their targets and goals are personally to how, how does that help the company and how they work together, what do you think that the That the guy or gal listening right now, maybe they've got a couple hundred employees like you, and they've never thought about this kind of employee.
[00:28:40] Chaz Wolfe: First, they've thought about culture. I'm sure if they have that many people, but they're, they're trying to wrap their minds around, how do I make it better or all the way down to the guy? That's just got one other helper. How does he take what you're saying and implement it tomorrow?
[00:28:55] Ryan Schmitt: Yeah, I think, you know, just no matter whether it's, you got the one or two other guys or you got hundreds, you know, pouring into your people, you know, one of the, the major differences of pre Valley of darkness and post Valley of darkness for me is, you know, how I interact with the company. ~Um, ~as I mentioned, we practice EOS and the EOS.
[00:29:20] Ryan Schmitt: Organizational structure,~ uh,~ professes. You have a visionary and then an integrator, and then the integrator kind of runs the company. The inter, the visionary is kind of out front, visionary, major relationships, and I'm in that visionary role and our president and COO is the integrator. And, you know, major relationships are one of my big focus, but the, the most major relationship is the relationship I have with our entire team.
[00:29:46] Ryan Schmitt: So where pre. I was in my office, head down, grinding it out, thinking that's where I was best suited for the company. I was totally wrong. I am best suited for the company where I am now, post Valley of Darkness, outside of my office. In fact, I don't even have an office. I'm sitting in a spare empty office right now talking to you.
[00:30:10] Ryan Schmitt: ~Um, ~I just find an empty space here or there with my backpack and I'll sit down in different parts of the office. I engage with people, but I also have regularly scheduled meetings probably two, three, four times a week. I'll be on a job site first thing in the morning with biscuits and questions and I call them feedback sessions and I'll meet with guys on the job site.
[00:30:31] Ryan Schmitt: Hey, what's going good. What are we doing good as a company? Where are we not so good? How can we improve? You know, how can we better help you? A, a year from now, if we're having biscuits on the tailgate, what do we have to do during the course of the year for us to be successful? What would you do if you were me?
[00:30:48] Ryan Schmitt: You know? And I tell 'em, I said, some of this stuff I'll learn. I'll go and make a decision right now. I can change it right away. Some stuff I just put in the back of my brain and the next decision I have to make down the road, I have a better perspective from you guys or what you're thinking about. And I'm telling you that process,~ um,~ of just listening and getting honest feedback and giving people the freedom and the opportunity to talk and share what they want and need is huge.
[00:31:15] Ryan Schmitt: So, you know, I don't know if I'll ever go back to having my office because I realized, you know, me being engaged in that. And then, you know, we We implemented a company app where everyone can share, you know, great things that we're doing. ~Um, ~not only during the work week on job sites, but even on weekends, guys are sharing their big fish they caught.
[00:31:35] Ryan Schmitt: And so, you know, and then, but it's a constant thing, you know, I've always written notes home, you know, like on the anniversaries and birthdays and new hire,~ um,~ you know, I'll send a note home to their house, to where they're Their family sees, welcome to the team. You know, so it's a, it's a bunch of little things and each one adds on top of the next, and, and especially when they feel like you're approachable and they, they can, they can share information.
[00:32:02] Ryan Schmitt: 'cause when I first started doing those feedback sessions, it was, everyone was pretty darn quiet, you know? And, you know, now being a couple of years into that,~ uh,~ they are so productive. I show up, the biscuits are passed around and, you know, we're talking really good, you know, progressive type ideas, you know, ~uh, ~people realize it's like, you know, it's not just a bitch session, it's a productive session.
[00:32:25] Ryan Schmitt: And,~ um,~ and you know, it's, that's how it is. Cause they know, like, Oh no, I'm helping chart the future of the company here.
[00:32:31] Chaz Wolfe: yeah, they know that you're for them.
[00:32:33] Ryan Schmitt: Yeah, I, you know, I don't know if there's any one thing, but just each one adds on the next and that your biggest major relationship, you know, when you say as a business owner, my major relationships, people often think, you know, clients and, you know, business partners, the bank, the bonding, the most major and the most important major relationship is, is that of your, with your team.
[00:32:54] Chaz Wolfe: Yeah, it's, it's easy to get lost in the office, head down, grind, like you said. ~Uh, ~I think that's a really great message. You, you've not just made this incredible press or push into your team and your people, but also into your community. ~Um, ~I was looking at some stuff of you and I think it's called digger day.
[00:33:12] Chaz Wolfe: Can you talk about digger day or maybe just like your involvement with the community? Cause it doesn't just go with your people. It goes beyond that. Tell us about that.
[00:33:19] Ryan Schmitt: Yeah, so we're, we're real passionate about giving back to our community. ~Um, ~we've done a lot with the, our, like our association,~ uh,~ NUCCA is the National Utility Contractors Association. I was the national chair,~ um,~ 2011 and 12 for two years. Our president was the national chair a while back. Or one of our executive VPs was as well.
[00:33:40] Ryan Schmitt: So we do a lot of it. Industry type stuff. And we've got some great leaders in this company that have supported our industry. But what really, really excites us is when we, you know, we talk about the things that support children. ~Um, ~there's two of them. Seamark Ranch is one that we've been involved with. I actually chaired the board some years ago and,~ um,~ we've got a big mud run coming up.
[00:34:04] Ryan Schmitt: We'll have like 60 of our people on a team and we get matching, you know, Petty Coach Schmitt jerseys that we. We support the heck out of that organization. We're helping build a couple of new homes right now. We helped develop the initial infrastructure of that many years ago, and we do a lot to support that.
[00:34:21] Ryan Schmitt: ~Um, ~but probably what,~ um,~ the pinnacle of,~ um,~ where our heart is, is yeah, Digger Day that's coming up on the 6th of April. And this will be our third annual. And what started is just. an event there where the fund, which is an organiza and emotionally supports are going through cancer wanted to have some kind with like heavy equipment where they can go out and partner up with one of our equipment vendors because they've kind of brought the opportunity to us.
[00:35:02] Ryan Schmitt: And the first year we called it dozer day. And,~ um,~ and then we got a letter from someone saying, we've got that,~ uh,~ we, we've got that term. You can't use it as trademark. So I'm like, well, we doubled, okay, well, we came up with digger day and we trademarked that. So it's ours. And you know, what bigger day is.
[00:35:19] Ryan Schmitt: is, and it's evolved now and it's gonna be big and robust this year. It's got bigger and bigger, but we'll set up almost every type of piece of equipment we've got from excavators, loaders, dozers, off road trucks, rollers, and we'll set up a real orderly kind of gated and sectioned off areas where these kids come out on a Saturday with their families.
[00:35:45] Ryan Schmitt: These kids were battling childhood cancer and they get, they come up and we've got all our volunteers and they get little hard hats and they can put stickers on them and their safety vest. Then they go out there and meanwhile we've got a DJ going in a bounce house and And face painting, and a pizza truck and a pipe crawl.
[00:36:03] Ryan Schmitt: But they can get on each one of these pieces of equipment. And if they're big enough, you know, someone will stand right there and kind of watch 'em. But if they're small, they'll sit on the lap of an operator and they'll spin it around and hit the horn and dig dirt or push dirt or. Get on the off road truck and go run a trail and, and these kids, and we always say, we're digging for smiles.
[00:36:25] Ryan Schmitt: We're digging for smiles and digger day, but their faces are just beaming and smiling. And, and a lot of times you're sitting there, like, next to the parents watching the kids and the stories you hear. From the parents about what these kids are going through day in and day out. And, but then you get to see them smile and their parents are smiling and they'll so many stories that they, they'll say like, you don't understand.
[00:36:51] Ryan Schmitt: You don't understand what this kid's got. And it's like you don't understand how important this is for them. And now these kids are like looking forward to it every year when digger day comes back. And so it's awesome. Yeah, we're digging for smiles of these families and these Children. But where we're getting smiles is from our team.
[00:37:08] Ryan Schmitt: I mean, you've got operators and people from the office and their smiles are beaming all day knowing that we can create this day for them. And what started out is just a day for them to smile and have fun with. We actually started raising money because a lot of our business Partners and different vendors and really valued partners in what we do saw that and wanted to be a part of it.
[00:37:34] Ryan Schmitt: So they just started donating monies and we sponsor each little event and part of the day. And now we're actually contributing some pretty substantial money to the child cancer fund as well as supporting these families and children.
[00:37:46] Chaz Wolfe: I love it. You can tell,~ um,~ just in your energy of telling that story, just the octave and the tone of your excitement just went through the roof there. And I think that that's a message for, for all entrepreneurs. I mean, when I had just two little franchisee or two little franchise locations, and I was, you know, 26 years old, and I remember doing a Christmas for a couple of single mom families.
[00:38:07] Chaz Wolfe: ~Um, ~but for my team to be able to like, be part of that, and they sold chocolate dips, strawberries, and bananas on extra things that, that, that little dollar amount went to the pot and, and they knew that every phone call in order that they took was like actually going to help a single mom family and actually many of the single moms we've helped throughout the years have been, you know, employees.
[00:38:25] Chaz Wolfe: And I just think that, That message that you gave not only of helping the end, you know, families, but your people, you created an environment for your people to be able to be part of it because oftentimes, at least what I have found is that a lot of people want to do these things, but they just don't create the own opportunities for themselves.
[00:38:45] Chaz Wolfe: And so if they have a forward thinking, visionary employer,~ uh,~ who's people first,~ uh,~ you know, This is part of it is taking an opportunity for your people to serve others. And it's actually serving your people, which I think is just so cool. ~Uh, ~congratulations on all that. What would you say,~ um,~ if you had the opportunity to kind of like wheel back the clock and you're talking to the younger Ryan and, you know, before, maybe even before you launched the business, even, I don't know, you pick the, you pick the age.
[00:39:12] Chaz Wolfe: And you whispered in his ear, what would you tell him?
[00:39:14] Ryan Schmitt: Yeah. So not yet. I hear that question a lot and that's,~ uh,~ gosh, I probably have a list of things, but,~ um,~ You know, I think early in my career is maybe it would be patience. You know, I, I mean, I had a burning desire just to, to excel and grow and thought I really wasn't, and I didn't see it. And then maybe it was just coming way slower, but then it's just almost the compounding effect of effort and intention and focus.
[00:39:45] Ryan Schmitt: You don't see the results so early and it can be frustrating and you think you're really not going anywhere, but man, after time, it just takes off. And to be able to tell my younger self that, Hey, Ryan, don't worry about it. It's going to come. It's just, it's, it just kind of comes after some time. And,~ um,~ you know, I look back on it now and then I really appreciate those days.
[00:40:10] Ryan Schmitt: And,~ um,~ but yeah, it's like, I was definitely, you know, would have loved to have my older self come in and say, yeah, don't worry, it's coming.
[00:40:17] Chaz Wolfe: Yeah, that's really great advice. Thank you for that. How can, how can someone connect with you? Maybe they're in the same industry and they want to,~ um,~ you know, get some advice from you or want to connect, or possibly maybe there's projects that they're associated to that they, they need to engage with you on a business level.
[00:40:33] Chaz Wolfe: How can they find you, your company, find out more about what you're doing?
[00:40:35] Ryan Schmitt: Yeah. So, you know, Petty Coach Schmitt, several contractors, our website, you know, pettycoachschmitt. com. If anyone's looking for a work opportunity, we have a very robust application process. ~Um, ~you know, I'm pretty active on LinkedIn. You're going to see and hear a lot about my philosophy and,~ um,~ you know, what we're doing as a company, our LinkedIn pro company profile,~ uh,~ is you can find out a lot about us too.
[00:40:58] Ryan Schmitt: And,~ uh,~ You know, r schmidt at pettycoach schmidt dot com is my email if anyone wanted to reach
[00:41:04] Chaz Wolfe: That's awesome. Well, I appreciate your vulnerability, transparency, all the things you've got to talk about here today, but you've been doing these things for years and years. Inside your organization. ~Um, ~it's honestly been a pleasure to be able to give you a little bit of a microphone here today. And hopefully thousands are going to hear this message and be able to go implement like you have.
[00:41:19] Chaz Wolfe: So thank you for being here. Truly an honor, blessings to you, your family, and all of your employees that are making big moves here this year. Thank you so much.
[00:41:27] Ryan Schmitt: Thanks jazz. Appreciate the opportunity

Host Chaz Wolfe is joined by Ryan Schmitt to discuss the importance of creating win-win situations in business. Ryan shares his personal journey, including financial struggles, and emphasizes the value of a people-first approach. They also discuss strategies for managing stress, fostering company loyalty, and Ryan's vision for the construction industry.

Ryan Schmitt:

Linkedin: https://www.linkedin.com/in/ryan-schmitt-14866587/

Website: https://www.petticoatschmitt.com/

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