Home Automation Podcast Episode #192: An Industry Q&A With Paul Starkey
In this weeks home automation show of Automation Unplugged, Paul Starkey, Partner at PrepTech and Aspire Liquidity Partners shares how he and his wife are fighting against sex trafficking through their organization, Building Better Lives.
This week's home automation podcast features our host Ron Callis interviewing Paul Starkey. Recorded live on Wednesday, October 27th, 2021, at 12:30 p.m. EST.
About Paul Starkey
Paul Starkey is a 28-year Custom Installation Industry veteran focused on helping others reach their top potential, building a great business, and innovating when it seems impossible. Paul began his CI career at ELAN under Square D in 1993. As the Sales Vice President at Elan, he engineered a buyout with fellow managers and sold the business to Nortek Control in 2003. Over the years, Paul has raised venture capital and been involved in a dozen buy-sell transactions. Recently, Paul sold VITAL MGMT and has co-founded PrepTech and Aspire Liquidity Partners with Steve Firszt. They have also authored Hitting for the Cycle, a guidebook for the CI space. Outside of the business, Paul and his wife have founded a charitable organization, Building Better Lives, to actively support and raise money for the fight against sex trafficking.
Interview Recap
- Aspire Liquidity Partners, a guided partnership designed to position your company for maximum value extraction
- PrepTech, a job program dedicated to training and connecting qualified talent to businesses in the CI industry
- How Paul and his wife are fighting against sex trafficking through their organization, Building Better Lives
- DMF Lighting's partnership with Building Better Lives
SEE ALSO: Home Automation Podcast Episode #191 A Custom Integration Industry Q&A With Jeff Costello
Transcript
Ron: Hello. Ron Callis is here with another episode of Automation Unplugged. Today is Wednesday, October 27th. It is just a little bit after 12:30 p.m. Eastern Time. I am hoping that I am streaming on both platforms. It is a special day because today's October 27th, which makes it my wedding anniversary. And this is my 18th wedding anniversary to my amazing wife, Danielle Callis. I am here with all of you, and I'm going to be one very soon with Paul, but I will be taking her to a very nice dinner here at the end of the day into the evening.
We're going to celebrate a little bit more this weekend as I will be off early tomorrow to Orlando for InfoComm. Going up there for a quick 24-hour trip in and out and actually be about 12 hours going to fly in the morning and fly back at night. It's less than a one-hour flight, but I have some important meetings with some new partners and want to definitely want to get up there. But a special shout out to my amazing wife. Everything you see at One Firefly and through my career would not be possible without her support. She is my backbone, and she's the one that gives my family and me all the support we need. She also is inside the business. Many of you don't know that, but she's on the accounting side and has a lot of back-office support. She's been involved really since day one and One Firefly.
We're actually going to be celebrating our 14 year anniversary of One Firefly, our birthday of One Firefly, on Monday. I want to say November 1st is Monday. I guess someone could confirm that I could probably confirm that. I know we're celebrating it on Monday. I'm actually going to pull up my calendar now just to confirm. Yes, Monday is November 1st. That whole week we're celebrating here at One Firefly our 14 year anniversary, which is also super special. But you folks are not here to learn about our birthday. Maybe you are or my wedding anniversary, but maybe you are.
You're here to listen to the one and only Paul Starkey. Paul is actually setting a precedent today. I think Paul knows this. But he is the only three-time interview guest on Automation Unplugged. Paul is even more famous because he was guest number one. He was guest number one, and then my team will drop into the comments, and they'll let us know. I actually didn't pull up the record on what show number two was, but I can tell you. Show number three is Show 192. That is the show we're recording today. Paul, he'll get on and tell us about his career, and we'll talk about lots of fun subjects. But most recently, he is a partner in Prep Tech, and the business Aspire Liquidity Partners. He's going to tell us all about that. There we go. My team just dropped into the notes. Paul was guest number 1, number 11, and now number 192. Paul, how are you, sir? I'm doing well, Ron. Thank you. It's a beautiful day out here in San Diego, so all I'm going to change my setting here so that I get you in my ear. Go ahead and say something for me, Paul.
Paul: Hello, there to everybody that is tuned in.
Ron: Hello. Alright. Well, I am hearing you through the computer speaker. But as long as we don't get any weird echo effects, it's not on your end. I promise you, it's on my end. I think we're good to go. Paul, where are you coming to us from?
Paul: I'm in San Diego. I live in North County, San Diego. I've been out here 11 years, Ron, and loving it every day is a blue sky day here.
Ron: Paul, you are known for being involved in so many fun and exciting industry. I'm going to say events, activities, you have a career back to the Elan and Nortek and those activities. Why don't you, at your convenience, maybe take us a little bit back in time for those that haven't heard a little bit about your background, and then that'll bring us into the present. I want to talk about your new businesses. I also want to talk about Vital, which I know you just recently sold. I want to talk about Bravas and lots of fun things but go ahead. Take us back in time, just real quick.
Paul: I've been involved in the custom integration business since 1993. I joined Square D that owned the Elan skunkworks at that time because that's basically what it was. We engineered a buyout in 1995 of the Elan business from Square D and then successfully sold that in 2003 to Nortek, which I think many I'd stayed on and played various roles. President of Elan, of course, but then ultimately the CMO for Core Brands and then left in 2013 to form a new company called Vital Management, the business coaching firm that really focused on quantifying and standardizing financial metrics in the CI business joined with Steve First, who had been coaching at that time for, gosh, close to eight years. We've had a great partnership since October of 2013. It's been a fun relationship. It's always great to have a partner who is about two thousand miles away. You get along every day. But now we're a great complement each other and have enjoyed working together.
Prior to all the CI involvement, I was in several computer-related technologies, technology-related businesses coming out of college with a sales manager, marketing and product manager, general manager. In those businesses, I got a lot of business exposure, and companies were growing that were acquiring companies, that kind of thing. I actually was with an emerging company I raised venture capital for. I've had a lot of industry-facing experience. I've had a lot of financial experience raising money, venture capital, being involved in both selling side and buying side transactions. It's been more fun than work, to be honest. More recently, to your point, we sold the Vital Management business. We were successful in getting the 15 companies' investment with the Bravas thing that we were doing. We then started a new venture with Helen Annabell called Prep Tech, which hopefully we'll get some time to talk about. And I've been doing a lot of charitable and philanthropic work as well, which keeps me busy. I've never been like a single task-oriented guy, so I need a lot of stuff to fill in the gaps when something is not as busy as I like it to be.
Ron: Tell us I'm going to put it on the screen, but tell our audience more about Vital and you and Steve burst that company. You've worked with many companies, not just the Bravas transition businesses, but many beyond that.
Paul: Yeah, the whole idea, and I didn't know Steve. I saw him once at a CEDIA presentation talking about business stuff, and I thought, this guy's pretty smart. When I decided to leave Nortek, I had this vision of being able to provide quantitative metrics for CI owners. I've worked with so many over the years and got a sense that they really needed help in the business side of it. And I thought, "Wow, this would be great." When I learned that 97 percent or more were on QuickBooks, I got what a natural thing to build a platform on QuickBooks. Said, give them the feed that makes a profit loss statement, balance sheet seem more simple for them. Steve called me and congratulated me as being a consultant after I left. He goes, "What are you going to do?" And I said, "I'm doing this thing. I'm going to create these metrics." He goes, "I got about 80 percent of that done. Why don't we do it together?" And I said, "Well, I wasn't looking for a business partner." About 30 days later, we're in business together, and taking my ideas and his hard work and fundamentals put them together. That became the vital signs early on. It became business intelligence for custom integrators, color-coded in the cloud dashboard that really helped his owner distill their business down to about six really important levers and available to everybody.
Now, not everybody took us upon it, to be honest. You had a couple of thousand custom integrators out there. I think we touched maybe 150 of them over time. What came out of that was people say, well, now we're doing all things together, maybe we should talk about this roll-up thing because our initial debt wasn't really to do it roll-up. And they used to call it an exit strategy, but we found out right away. Nobody gets to leave this Hotel California, right? Let's just figure out how we can monetize these businesses. We had a co-op with about 32 dealers in it. 15 of them wanted the go-to-market. I had done some investment banking and venture capital process, but we were able to lead that, and we closed a 65 million dollar deal for the owners, and that became Bravas, the company, as it's known today. We consulted with them where we're not as actively involved with them. We do play a role with them, which is finding new companies to join their network. But we're arm's distance from the company at this point. We're both major shareholders or significant shareholders, so we have that. But it's the evolution of Vital, and the coaching notion was really they held together CI owners, a mentor and accountability coach that most of them don't have, and most of them talk to their wives or other significant others. They may have a friend, but most of them are islands. Most of them have evolved their systems to where they are. Most of them have very little mentorship around them.
Ron: Most business owners don't have anyone to tell them, no. Or maybe you should reconsider that, or maybe you should think more deeply about what you're doing.
Paul: And we never intended to be, yes men. We were saying no more times than we said yes. We had the advantage of this because we had dozens and dozens and dozens of data points of how companies performed. We could show business owners what was possible because they had one set of data points. They knew their data. They knew what they were able to achieve profit-wise or what their ratios of compensation or margins in this kind of thing were not always measured the same, but they had one set of data. We were providing them feedback on dozens and dozens of similar size or even companies in their regions and so on and so forth. The benchmarking became a very important part and still is a very important part of what vital management offers. And the company is rebranded as Grow with Vital. Matt Bernards, who was one of our great students and sold his business before the Bravas transaction, is leading and maths the consummate coach. He's just got the greatest personality and acumen for it. He's not Steve. He's not Paul. He's Matt. He's very effective. They've just hired Lawrence Davis.
Ron: I was talking to Lawrence on the phone yesterday. He gave me a call just to say hi and introduce himself. I mean, I knew Lawrence, but he was introducing himself in that role at Vital. He's doing business development for him.
Paul: They hired a couple of our ex Bravas General Managers who grew up in this system to be coaches. They're doing what Steve and I never got around to doing, which was scaling the business so it could be more open and and and in a greater diversity of services and allow more people to participate. We had kind of hardcore "we're going to change how you do things," and that that was a speed bump for a lot of companies because that would fundamentally change the accounting system, their processes, and for the ones it did, it was fantastic. But not everybody loves broccoli and brussels sprouts because this is so low on the totem pole, even though you could say getting from five percent profit to 15 or 20 is important, unfortunately. And see, I must be going up. I make another. I'm good at making money, but it's also more than that. It has cash reserves. It's building that strength in a company that when you have hard times, whether it be a pandemic scare or anything else, you have the resources to be content through it.
The Vital model is still intact. It is in great hands going forward. Steve and I are consulting with them. There's great ownership back in with Jeremy Burkhart, and a couple of his buddy investors are behind it, and we're really excited about where it could go. And with people that have a lot more runway time to grow the business than Steve and I had. We're excited about the legacy of Vital, and we kept one piece out, which was the piece that conditions companies to be bought by companies like Bravas. We call that Aspire. Steve and I are doing business as Aspire Liquidity Partners. We have a handful of companies that we're taking to the next level. There are We now have our third hit on our website.
Ron: You got a whopping three hits this month or more.
Paul: Steve and I joke because we're the only two guys that knew how to get that up besides you, Ron. These are of our services and what we do for companies. It's getting them on the system. It's taking everything we know. I just published the book that 30 companies have bought. Thank you all for paying a thousand dollars for a silly book. You're out there. This was one of the first this book, and I didn't feel so bad spending a thousand dollars. I knew that the thousand dollars was going to charity, and you are so supportive of such a great cause. In fact, why don't you get the money for the book? It's not about the fact that a book is. Well, Bill, they gave you a thousand dollars of benefit, you should return, but it's all the answered, really. In eight years, I've worked with Steve. It really, in a very simple Reader's Digest version, gives you all the things to do in the business to be more profitable, to be more productive, to be stronger financially and operationally in the business.
The charity is called Building Better Lives, which is what my wife Jerry and I started the foundation three or four years back and have raised most of our money, but one point five million dollars for safe houses for sex trafficking victims, and we opened on her birthday this year, March 31st, the first house that we funded here in San Diego. It' in a network of seven houses currently that will end up being 30 over a period of time. These people do amazing work of turning the lives around to formerly abused teenagers that were abducted into sex trafficking. It's not a foreign problem. It's right here in the U.S. citizens of all ethnicities and races, and it steals the childhoods of these young girls. These people do amazing work. They were just in San Diego last week. I got to meet all the executive directors and program managers, and we're just so tickled that they work with them, and all the proceeds of the book go to that.
Ron: Give a shout-out. What's that website?
Paul: bblfund.org. If you choose to buy the book, that's great. If you choose just to make a donation, that's great too. It's just a cause that is so important. We had a concert years ago at CEDIA that raised $150,000 dollars with the support of all the good manufacturers, including One Firefly and other friends. We just love doing this, and that's it makes a difference. Our why makes us cry. It really is a heartbreaking situation, and we hope you will contribute if you can.
Ron: No, for sure. So at a high level, Paul, the least value an integration business, it seems like they would gain from engagement with, say, Vital or coaching. Is there running a more profitable business? It seems like the most they might gain is an opportunity for an exit. Can you give perspective to that?
Paul: Right. And I think the way to look at it is they should look at it at 95 percent improving what you do. Because you only can get in a position to be bought if you're attractive and you're standardized in your normal normalized. I would look at this, validate what you're doing. Find out what you're missing. There are 55 management actions in this book. I guarantee it most companies are missing 40 of them. Find that out. Get some help. Get involved with doing an assessment of your business. It's a simple step. Vital does it? I think it's a $495 assessment. They'll take your numbers, and they'll benchmark you against what's possible that a loan is great feedback that most companies don't have. There are several six or seven steps of choices. You don't have to get a full-time, interruptive coaching experience. Some people need that and should take advantage of it. But I would say this is the vision. Their vision, and we just absolutely support are to get a thousand plus companies doing the same things the same way. If you never exist, or you never monetize your business through its sale, you will monetize it through that experience. You will make more money, you'll have more cash. You'll be able to reward your employees better. You'll be able to take care of clients better. You'll have more staying power, all of the things that come with it. If you just get involved with that aspect of it, the sale of your business. It's going to be limited to their field of view that will want to do that, see value in it. The timing will be right. It fits with what you want to do for your employees and your clients going forward. They'll be enough of that.
Also, they will make Bravas wildly successful, but I won't go into it with that in mind that go into it with, "Hey, I just need to learn more about what I'm doing here and do it right." These guys are smart guys. We've proven so many of the theorems of running the business, and I wish I would have known these things about other businesses I was in a much earlier date because when you understand the business model, and you understand how to leverage it, there are so many things available to you that you never even thought. Every random decision you make every day, you'll have a better template for making better decisions. It's just that simple.
Ron: Paul, what's the spread? You and Steve found since 2013 when you started looking at businesses and really looking doing that analysis. What's the true profitability of the integrator out there? I would easily say that we found 10 points of profit for our average company. Some more. We occasionally run in their company or go, "Wow, they figured this stuff out on their own." But it's far and few in between. If you look at the companies that we coached, which I think at one time, we had over $200 million of revenue under our coaching scheme, and we figured 10 percent, that's 20 million dollars a year. And this is repeatable profit, right? It's not just a one-time grab. It's unless you fundamentally go back to what you were doing before you make it every year. 20 million dollars of profit a year. We've been doing it for eight years. That's a big impact on the industry and on these companies, and on the livelihood of people. The most rewarding thing is in all of this is helping people, helping people run their businesses, helping people get out of a life that's inappropriate for them, but that they have very few people that help them out in the new business. Prep Tech is helping my friends find new technicians, dig in.
Ron: Tell us about Prep Tech. I'll put the artwork up on the screen now.
Paul: Most of it can just ride around. What's the most famous sign you see these days? It's not that your house is for sale. It's now hiring. I don't care if it's a Taco Bell or where it is. Everybody is trying to find out what happened to our vaporized workforce. People that were there two years ago. Where did they go? Nobody can hire anybody, but we've always had this problem. We've always had a problem getting new techs into our business. What we've done is just hired each other, the retreads, some of the best people we bid for them and attract them to our businesses. Occasionally, we got people from security and I.T. and ended businesses into the business. But by my estimation, if we don't add 2000 techs every year, we're going to run out of the ability to grow our business. Our bandwidth will be consumed.
We will not be able to have double-digit growth, which is not because we run out of customers. We run out of people that put in projects for them. Our salespeople have to slow down, which is just crazy in my way of thinking. Keep selling, keep installing. It's a big problem. I wasn't particularly satisfied that we had solved the problem that as an industry, that that we were even working because the average 19 to 25-year-old if you got him on the street and interviewed them and you asked them why their home technician, that they couldn't help they would know if they're in grade school when a plumber or electrician or something. Low voltage is so low on the whole training totem pole, right? Even in our trade schools and tech schools, it's a great alternative. But we're finding that some of the statistics are very concerned about what's happening with our youth and that more of the college-oriented high school graduates are now female. Almost 75 percent of the admissions aWe thought this is a perfect storm we have. It's an alternative. We have a great job, but it's 40 hours many times over time. A lot of companies have great benefits. It's a great work environment. The hours are 7 to 4 every day. You work in some of the most awesome homes in America. You're out in the field. What's that attractive? You don't do the same task every day. You're not at Amazon moving a box to the conveyor belt or UPS or that kind of thing.
You're not at a phone company where they add the hours are crazy. For somebody who has technical aptitude? Great job. Great opportunity. These recent compensation reports show that within four years, there's a 50 percent increase in the starting wages or wait eight aways average of the first two years. There's great wage advancement. These are small companies you can move up the ladder. Many of the people that are running our companies are in senior positions started as field techs. I had to sell people on this call on the wonderment of these jobs. It's great, but we don't have enough workers to fill them. Think about our small companies, our six-person, 10 person, 12 person, 20 person companies. How much time do they have to do recruiting to build the relationships with the schools and the military and in the conduits for these people and keep those relationships spending and then test those people and then maybe give them some basic training? Prep Tech has tied the whole band so full loop that we're going to establish the relationships locally where we're working in Dallas right now with the schools in the military. We believe we can go to the top 15 20 markets. We can have local relationships in location. We're getting the best students because the teachers in the military will help you vet and get the best. And then we test them. We have a scientific testing methodology called TAT technical aptitude testing. If they score high on that, then we afford them the job-specific knowledge is 60 hours of online training that gives them all the basis on signal processing, wire dives, the manager, network management, and setup. It doesn't train them on every manufacturer's product. It just gives them a basic foundation. When we married them with the local employers, the employers had people that have been vetted by their teachers and men and military personnel. They've taken the tests they've taken. They have a basic background in it, and it's a great entry-level opportunity, and we're doing that at a fraction of a cost.
The placement of these graduates is like one-third, the cost of what you'd pay a placement organization. The concept was not to do 10 or 20 of these a year, but could we be responsible for a thousand hires every year or more? It's a scalable model, which you shouldn't be surprised by. We're doing the hard work. If this was easy, everybody could do it. It's not easy. It's very hard, actually. But we're getting a good response from the dealers. I always say we were starting a lemonade stand. We have to go get the right lemons. No lemons. No lemonade. We're in the process of doing a pilot and one market, which is Dallas, Fort Worth, and we're trying to get our first 40 to 50 students in our courses. And at that point, we'll be offering them six to 12 employers and in that marketplace. Once that's successful, we'll move to four or five other markets and then ultimately have our platform because if you think of it, it's testing. It's a relationship platform, testing platform, it's a training platform, and it's an onboarding hiring platform because the other problem we have in our industry is a thousand companies, a thousand different ways of onboarding employees, and we essentially are writing the manual on that so a company can checkbox what things they want to do in the first 90 days. We've got to make sure people stick in this business. The problem with job boards today and interviewing. There's a little bit of a fallout, frankly, of people who don't have any experience, haven't been vetted like this, haven't been through, haven't had to commit any time and effort. Are they going to be there 90 days either by the employer's choice or the employee's choice anyway? That's Prep Tech in a nutshell. Yeah, it's another big problem. We like tackling big problems for the industry. Raising the business acumen was one. Addressing the workforce shortage is another. I don't have enough time or gas in my tank, the software, many more others.
Ron: But I was going to say, you are a problem-solving machine. Paul just goes a little bit deeper. I'm sure you piqued many people's interest with the idea that you might be part of the solution for the labor shortage. Just a couple of high levels. This is pre-revenue at this point. Do you have dealers that have paid for these techs, or are you still more? Where are you at? Is the education baked?
Paul: We're in the proof of concept? Right now, we're not even asking employers to provide any funding at this point. We simply ask them to sign a letter of intent with us that says when we have graduates available, they will subscribe to our service. The subscription is a thousand dollars a year. You get access to the graduates, and that when you hire, you get five hundred dollars back each year. If you don't hire anybody, you're out of thousand dollars. You hired to that money gets recovered, and you're paying that $2000 placement fee. Then the third person is two thousand so on so far. Usually, the placement fee of thirty thousand dollars plus a starting person is anywhere from thirty-five to fifty-five hundred dollars. It's an economic model, but we're in the letter of the intent stage with the employers. We're in the recruiting stage for schools in the military. I'm actively involved with that. Mark Weissenberg, who I've worked with for a number of years, is working with me. Helen, as I mentioned, is involved. We're in the process of signing up schools. What you really want is you want reoccurring sources. You want, you want the schools that will give you their top two or three candidates every year.
We think in Dallas, that's having at least a dozen conduits to feed that market need, and that that's true of most of the other markets as well. That is happening as we speak. Our learning management system, which is, of course, gone, is one of the easier things because that was a lot of the content Helen had. We've added some soft skills training to that. That's in the process of being completed. Normally I wouldn't like to talk about these things until, yeah, after the fact. But this fourth quarter is our large quarter for Prep Tech. Have me back on episode 220, and I'll give you a full report on how it went. But we didn't want to try to boil the ocean and do a national thing. A lot like our custom integration business. This is a local source of it, not to say that we can't find people in Dallas, and they'll move to Detroit because they were in the service or two or California or other places. That will happen.
But usually, the people that we're finding went to school there, that will stay where they're at. I always look for businesses where there's not a lot of inventory and not a lot of employees. This is a business we can scale. The inventory will be the students, and of course, and we do want a lot of those, and we'll be able to have relationship managers in most of the markets.
Ron: This is the solution to a problem that our industry certainly has. That is the lack or the challenge around hiring and bringing the people into all areas of the business, but certainly at the entry-level positions. I'm here in Florida, and I remember there were sound advice stores here. They're about in the high 20s, maybe 28 stores, I'm remembering, and they ultimately got absorbed into Twitter, and then that whole thing went bust. But for many years, the Sound Advice stores were a feeder system, and the talent was coming through that store and then ultimately getting absorbed into integrators throughout the state and up the East Coast. Those people were often going in, then launching their own business, and it was a birth thing. It was a birthing space for integration companies.
Paul: Best Buy, very similar is big. Companies have the resources. They did a recruiting and training right, and then they would spawn people into CNN. Unfortunately, our retail sources for that and even some of the longstanding ones have faded, you know, faded to black and or red, I should say. This is a strategic problem, and it's a strategic solution. We as an industry have got to up our game. We have to educate the general world. What is this niche? It's a big business. I estimate that our retail volume for custom integration in even taking out some of the things which shouldn't count is still about six billion dollars. It's a big retail business. The manufacturer business is probably two and a half billion. If a tech can generate 75 to $100000 a labor revenue a year, we need to add two thousand plus tax a year to keep this thing growing. I'm confident we will, but we need more elbow grease on this, and this is not a competitive thing with buying groups or CEDIA or anything there. All of those groups are doing a great job of training the people somebody else hired, and that's important for increasing the productivity of our workers and raising the bar their bar. But at some point, we need a continuous flow of quality talent into this, and we need to tell our story better to the consumer. What we do is unique, and it's special to sit and be rounded off to. Well, I can do that with a Ring Doorbell and my wireless speaker in it. It shouldn't be discounted that easily. It's a marketing problem.
Ron: But it's a big problem, Paul. But that's what you do. You take on big problems, and you go, Yeah, I can do this. I can. There are people and the ideas about, but you execute, show me a mountain that somebody has fallen off of and I want to climb.
Paul: Thanks. But you know, it's all learning, right? What we do in our business, we learn from our failures, we learn from other people's failures, and we try not to repeat them. Thank you for the opportunity to share that. I am confident in all of that that we can make. We can wiggle the needle in this and whether that's hiring 200 people or two thousand. Everyone helps. It's just like the safe house. We have one girl or we help a thousand girls. Everyone's important. We continue to do that. I would like to shout out to one of my sponsors.
Ron: Yes, please.
Paul: DMF Lighting has done an extraordinary thing. They approached me about using our foundation, our charity, as their corporate charity. Michael Mann and Russell over there in their marketing environment have just been awesome to work with. They put together a program called Shine a Light and it's shine a light on building better lives. What they're doing to the dealer makes a nominal donation to our foundation as little as $2. We'd like to see a lot higher $100 or $500.
Ron: I think our listening audience can do more than $2.
Paul: But if you got $2 dollars and you're a DMF lighting dealer or want to be one, you just start with that donation, and then every fixture that you purchase from them, they make a $2 donation. We're talking we're dealing with actually hundreds of thousands of fixtures here, so it's an awesome gesture on their part. It starts with our dealers raising their hand and saying, "Hey, we'll support this." It doesn't come out of the dealer's money. It comes out of the manufacturers. They have it on their site. They have the Shine A Light program on their website, there's a little bit of, I believe, on my website as well. We'll put a link to it in the Facebook and LinkedIn comments, as well as the show notes page. But I just love vendors and in our space who walk the walk. They say they give back, and here's a great example, they do it and whether it's this cause or any other cause, I would just love to see more of that from our manufacturers and from our dealers.
Ron: I see my team, Jessica just dropped it into the show notes. There it is. dmflighting.com/integrator/shinealight. You guys probably just want to go to their website and click through that. I don't know that you want to take my dictation, but I'm going to ask you to pull out your crystal ball here, and I'm going to give a reference or give a shout-out to Randy Stern. She's CEO over at D-Tools, and I sat through a wonderful talk that he gave at the Azione conference a couple of weeks ago in Nashville. In that, he talked about it. I feel like my head's been in the sand because his message was very different than what I thought was the case. But I also had this confirmed yesterday from a different economist that is going to be headlining an event next month at the Total Tech Summit, and the theme is that our economy here in the United States is actually potentially poised to look really good for the next may be as many as the next eight to 10 years as opposed to maybe my head in the sand comet would be, I was concerned, maybe only another six months. What does your crystal ball say? And it really ties in my mind to the labor shortage? Is this a short-term labor shortage issue, or is it potentially going to go on for years?
Paul: Well. Why are why is there a labor shortage is there because there are too many people standing out of the labor force or is some magical thing happening where the demand is quadruple? Now, yeah, know I pulled through a Taco Bell last night there. Their demand has probably increased because more people are eating out and doing the drive-through I think it's a recoiling effect. It's like pulling a rubber band back and back. We've had 20 months of just unusual restricted activity and in pipelines, supply chains of the clogged up and building cost have gone crazy. The board of two-by-four plywood.
Ron: Commodities pricing went through the roof.
Paul: Yeah. It is coming back and now copper is going crazy. There are all kinds of things happening, right? But I think it's a recoiling of it. I think the workforce will come back. I think the supply chains will mellow out. But I think what's going to happen is we're pulling on this rubber band and I think it's going to catapult once these things normalize. We've had a blessing in custom integration. Lifestyles of the rich and famous kept spending and kept spending that technology at home. We've been a big benefactor of this. I think what always changes if we read a lot about what things do, invest in it. The big technology push is whether it's electric vehicles, that's crypto. Biotech, it's A.I. There's a lot of Big Tech is going to be factored in our lives. People with him probably gave up on the farm gas stocks, Facebook, Amazon, Netflix, Google, Apple, Tesla. But I bought some of those three months ago. I think they're all up 30 percent since then or something. We're going to see more of that and we're going to see they're going to see a lot more emphasis on productivity, I think, and things that help. But we're going to see a shift. Maybe like the roaring 20s, we're going to have boomed, but it's going to create more divisions, more gaps, more economic gaps.
Ron: Politically, I've never seen our country in a weirder spot than it is right now, maybe globally than it is right now. It's just so much weirdness out there.
Paul: Think about what happened in the late twenties, in the thirties that led the World War Two. I mean, there were a lot of the same wins. Different, but same fundamentals.
Ron: Themes are similar.
Paul: Will history repeat itself? You know. But I think short term there's a lot of opportunity for us, and I think they'll continue to be more opportunities. The rate of innovation is just spinning faster than it is ever spun, right? I didn't grow up in this industry and I hit the door in July of 1993 in the technology we had then versus the technology we have now. It's crazy. We thought things were super cool back then. We were excited about F connectors back in the day.
Ron: '93 maybe like 4600 baud modem.
Paul: Almost pre-internet from home usage.
Ron: Yeah.
Paul: I was in a data capture business that was a precursor to Zoom and all this right?
Ron: You had to have specially built pipes, T1, T2 lines to even use it in only the government and big corporations were able to use it effectively. We were just scratching the tip of the iceberg in terms of innovation and it. It is not going to slow down and it's going to impact our lives in ways that we can't even think about. You mentioned something, Paul, that of course, tickled my ears because it happens to be a hobby of mine. You mentioned the word cryptocurrency. Are you an investor in bitcoin or what have you done?
Paul: I did not get into it about the summer last year, and I traded and I made a lot of money and I got out and I convinced my good friend and partner to take some money out of a company that wasn't making any in the interest then, is best bar enough. He just put it down and went to sleep. Rip Van Winkle style. And he's been a lot more successful with it. I'm too much of a busybody. I got to get in and buy, sell. But you know, it's I think it's just another indicator I saw where there's now. One or two trillion dollars in that.
Ron: Yeah. I would say the market cap is over two trillion now.
Paul: Yeah, it's crazy. And it's like sixty million bitcoin or crypto holders. It's not a fad, I mean, it's funny every technology that ultimately takes over. You can know that the late adopters are going to call it a fad when it when it's early. I can remember Sonos and I remember taking the product into our lab at Elan. This is the early days of us and we had a big ceremony and christened it as just a crazy fad. Now, I know there are three hundred companies and CI manufacturing companies that would like to have the revenues. That's absolutely right. Things change and you've got to be willing to be in the chain cycle, you can't fight it. You just got to look for opportunities.
Ron: What happens when you deny it?
Paul: You lose, you always lose, you become the blacksmith and the travel agents of industry. Things change and they're going to change and our space will change. But, I always thought what was really cool about custom integration is for it to be valued. It needs change. It needs to be on that leading edge of innovation. And it's a good place to be. It's a great place to be. And it's created a lot of good livelihoods for a lot of families and a lot of people. It's awesome.
Ron: Amen. I've said it many times on the show, but you know, when I joined the industry 21 years ago, in 2000, I joined Lutron and I said, "I think there'll be more technology in our lives tomorrow than there is today. If I'm going to enter an industry, this is probably a good industry to join. I don't know anything about it yet. And a lot to learn, for sure." But it just seemed reasonable. Maybe just logical. There'd be more technology. Technology would continue to advance.
Paul: What's changed more fundamental than your business run? I mean, the digital marketing business. It's taken over print, it's taken over all the traditional forms of advertising and communication and marketing, and it's a high growth, highly desirable industry. All these platforms of Facebook and Instagram and all the others, who would have thought that that was the way of the future?
Ron: One thing that happened during COVID is when some of these and sadly some businesses had challenges opening their doors or customers didn't want to come and visit physically. But you know what they were doing as they were visiting digitally?
Paul: Yeah, there were. Our phone tells us how much screen time we use.
Ron: I was so proud of myself. It's funny. You mention that on Sunday, I saw that I had used my phone nine percent less than the previous week, and I was like, This is good because my God is that thing addicting. And I know it's not good for me, but it's hard to put it down or not. Check it every so many minute.
Paul: Well, who would have dreamed? I mean, I started the computer in business in the mid-seventies and had a dream that everybody would have a computer in their pocket. We just socialized that idea in 1975, you forgot that. That's more than, you know, Star Trek kind of stuff, right? But it's not only a computer in your pocket, but three cameras, not one, but three, and access to all the world's knowledge. It's an amazing, amazing world we live in, and I think as human animals, we just have to learn to adapt and adopt and spend fast. I think speed is always desirable. The faster you can do things. I've socialized our Prep Tech idea with a lot of large companies. And in the back of my head, I know that I and two other people can do it a lot faster than any big company out there in terms of a proof of concept. Now we can't scale it like big companies. Good, but you know that that's where the opportunity lies. If we enjoy the science of business, look for those opportunities, look for the things that we can do well and faster than other people. Then hopefully you'll figure out how to monetize them. You and I had had this personal conversation before, but not most of us put a stay six months out five years from now and say, This is where I want to be. We just go where our daily stuff takes us. It's an extension of day-to-day or week to week. Sometimes I think you need to get your head above the dashboard and say to yourself, Where do I want to be in 60 days, in 60 months? You don't have to get anal about it. But if I might live in San Diego and I don't have a vector to go to Chicago, chances are I'll never make it.
Ron: You might land here in Fort Lauderdale.
Paul: I could get to Arizona quick, who knows. But yeah, it's one of my pieces of advice to business owners. Take a little time to ask those questions. Even if you don't get a concrete plan of where do you want to be? Five years from now, now to the point where my answer is real simple, I want to be at the end just five years from now. I think I know what that means for me, hopefully not on a respirator, but hopefully, not on a respirator, that's for sure. The reason I have so many irons in the fire is that I like to poke in them. Again, thank you for inviting me again. And hopefully, this isn't old stuff to the people listening.
Ron: No, this has been awesome. Paul, I appreciate you coming on Show 190 to Paul that people listening or watching, where do you want to send them so that they can get in touch personally or for any of your businesses or activities?
Paul: Well, if it's Prep Tech related
Ron: If you need help with that, give me a call after this and we'll give you some pointers on getting that email set up.
Paul: The webmaster is like way down on my totem pole of things I do. We're having fun working with the new owners there. We got some really great Aspire clients we're busy with Prep Tech and I'm trying not. I promised my wife I won't start any new ventures for at least three or four months.
Ron: We do have a comment. Paul, we're going to close on this. Our one and only Vanessa. She's been with us here at One Firefly many years and she says, "Great show, Ron and Paul. It's always good to hear from Paul and learn more about the awesome stuff he's doing with his charity and the CI space.".
Paul: Thanks to One Firefly, you guys have been awesome supporters of all of our charity events and Ron bought a book. Even though, yeah, there is some stuff in there that might apply.
Ron: It's been passed around my executive leadership team where we're converting and utilizing what makes sense.
Paul: Well, we need more apostles and you guys are great and. All the work that we did on marketing Bravas and what you've done with Bravas has been awesome and we're excited about what Bravas has done. We didn't get a chance to talk about that. But they just recently had two of their locations. They sold off and I was out in the fields when they were whole. We heard that Bravas is closing down and that's so far from the truth. They're focusing on critical mass markets where they can have a fifteen to twenty-five million dollar presence. The two markets that they divested, Oklahoma City and Little Rock were never going to meet those goals. That was the core reason for that. But they are very much alive, and I think you'll see big things in 2022 from a merger and acquisition standpoint. They're a very large and effective organization, so we're excited. They have stock ownership and they have and continue to watch the things that they're doing. As I mentioned, our Aspire program has a connection to them. Yeah, looking for great things out of them. And I think the future bodes well for what they're doing and how they're going about it.
Ron: Awesome. Paul, we're going to close on that, sir. I want to thank you again for coming on Show 192, and we'll have to make sure it's not another or it won't be the quick math here. Another 181 shows before you come back on.
Paul: This is a great thing you're doing, Ron. I do a thing with Vital called Tuesday Morning Coffees, and we just finished our 402nd weekly publication. It's a 400-500 word problem we saw there I would attempt to talk about or solve every week, and this takes a real commitment to do this. My hat's off to you. I never envisioned you getting close to 200 of these. And I did feel slighted that it took a 180.
Ron: You've been busy. We've been busy, but it felt very appropriate. I wanted to help you celebrate some of the most recent wins you have.
Paul: I'd be remiss if I didn't congratulate you and your lovely wife on your anniversary. That is an impressive 18 years, but 14 years of really building a phenomenal business. That's a great service to our industry. Congratulations to you and your people. And yeah, I feel like you and me as friends than they've been able to share and a little bit of that.
Ron: You've been right beside me through a lot of it, and I want to thank you for that. Awesome. And a lot of everybody out there. Awesome. Well, we're going to push this out. We've got a wonderful audience watching us live and we're going to push it out on the podcast. The audio podcast, as always, will be available next week for download. That's how we also have quite a download following, so they'll be able to hear you and hear all this goodness here in about a week. Paul, thank you, sir. I'm going to tune out or sign off here and but hang out with me, Paul. Don't don't leave. I'm going to pull you off-screen. Don't leave. You and I'll do a quick round.
Paul: Alright. Thanks, Ron.
Ron: Alright. Folks, there you have it, the one and only Paul Starkey, we dropped lots of links into the show, notes Paul's various business activities, as well as his various charities, the charitable organization, our activities through DMF Lighting as where as well as BBL Fund, which is his primary charity. Definitely be sure to check those out. If you don't know Paul, you should just reach out and say hello. He's a swell guy and he's full of wisdom and I'm sure he'd love to hear from. If those of you out there have not already subscribed to the podcast, please do so if you haven't left us a review. You can leave it on any platform Spotify, Apple Podcasts, whatever your preferred method of listening, that'd be great. It helped ultimately, our audio-only podcast get out to a wider audience. On that note, I'm going to sign off, I think. I am not doing a show next week because I'm actually going to be traveling. Although it is our birthday celebration so far. Make sure you follow One Firefly on all the socials. You'll see lots of fun content coming out every day next week to celebrate our 14 year business birthday.
But I will be doing some video shoots. I'm actually going to be in Texas Wednesday through Friday, personally shooting a number of different types of projects for clients, which you all will see out on the internet in the coming months. But so we're not going to do an Automation Unplugged, so I'll see you guys on the week after. On that note, have an excellent rest of your Wednesday and a great week, and I'll see you all next time. Thanks, everybody.
SHOW NOTES:
Paul began his CI career at ELAN under Square D in 1993. As the Sales Vice President at Elan, he engineered a buyout with fellow managers and sold the business to Nortek Control in 2003. Over the years, Paul has raised venture capital and been involved in a dozen buy-sell transactions. Recently, Paul sold VITAL MGMT and has co-founded PrepTech and Aspire Liquidity Partners with Steve Firszt. They have also authored Hitting for the Cycle, a guidebook for the CI space.
Ron Callis is the CEO of One Firefly, LLC, a digital marketing agency based out of South Florida and creator of Automation Unplugged. Founded in 2007, One Firefly has quickly become the leading marketing firm specializing in integrated technology and security. The One Firefly team works hard to create innovative solutions to help Integrators boost their online presence, such as the elite website solution Mercury Pro.
Resources and links from the interview:
To keep up with Paul, check out their website at preptech. Paul can be reached directly by email at