This might be a bit of a gold rush of sorts at first, in that the first people to transition from tech to running a small business, whether tech-enabled or not, will find a bigger piece of the pie waiting for their taking. But as the stream of many others increases over the years, the pie's slices will get smaller as competition for the same market segments increases. Not trying to paint doom and gloom, just that I'd imagine, as the author says, this kind of white to blue collar shift will accelerate, and as it does, competition will rise, lowering the chance for overall profits.
In my limited “ai transformation” experience the biggest gains seem to be just forcing down some of the walls between these different systems. Larger, more well run places were probably integrating all of their systems/data/etc so there was none of this low hanging fruit. It seems AI as a forcing function of combining data sources to feed into the AI just had the beneficial side effect of connecting all the crap.
That said, this guy is a superstar. This kind of application of skill to a totally different business paradigm to improve it is what I'd love to spend my time doing. Knowing my personality, once I improved the business, I'd get bored running it and move on to finding something else to improve.
I liked that you picked a service that has a relatively low barrier to entry. The real asset are local
operators and referrals. Making them more efficient without being controlled by a big company would be a boon for everyone involved.
Consider being a platform coop with regional operators as members. See https://platform.coop/
I’ve never heard of platform Co-ops. Cool! Lots of people predicted that a beloved local coffee shop was doomed to fail when the workers got a loan and bought it to run as a completely flat cooperative. It’s been a few years and they are absolutely killing it. I’d love to see the tech version of that.
Yes, the barrier here is the desire to study and pass the exam. If willing, you are up and running relatively quickly - but only as a technician under someone else's operating license. To get the operator license (eg to be a full on pest control company) requires 2+ year documented experience and another set of exams.
The operating license holder is also on the hook for legal action if (when) things go wrong.
"Control" is interesting and I have found in all trades that people value their freedom. The good companies don't monitor employees too tightly, and are rewarded with loyalty and longer tenures generally. Of course you have to run a good recruitment and referral process to find the good people!
Doing something similar. Bought a business in the petroleum equipment service space. Building internal tools for ourselves. Pen and paper still dominates the industry.
I hate to be the bearer of bad news, but as a recent white->blue collar convert, (union metalworker,) tech workers are usually far less qualified than your average vocational high school graduate, way less physically capable, and waaaaay less tolerant of the sort of workplace unpleasantries in these types of jobs at the entry level. Your tech experience gets you pretty much zero advantage, and there are lots of very smart people outside of the software world that have put a whole lot more thought into that industry than you have. Consistently high labor demand meant companies had to comparatively treat tech workers with kid gloves, and as a result, most don’t realize how much smoke has been blown up our assess for decades. They start as soft, arrogant, maladroit noobs who will cosplay as working class for a couple weeks and either eat crow and stick with it long enough for their boss to not want to throw them off a bridge, or give up/get fired and try to pay the bills doing zero-entry-barrier gig work. I was fortunate enough to have been a blue-> white collar covert a couple of decades ago so I knew what I was getting into. The fantasy that a tech worker landing in a blue collar field will naturally rise above the rabble and shoot to the top is a workplace version of the fantasy where a white person finds themselves in some jungle full of “savages” and is so inherently impressive and sophisticated that they’re immediately made king.
yeah. there absolutely are lots of very smart and capable people outside of tech. as someone who has seen the blue collar world "up close" (family businesses), its a different breed... the culture and attitude gap is enormous. shockingly so. most tech workers I know couldn't hang (don't hustle as hard, risk averse, liberal), but some skills may transfer, like problem solving and diagnosis, i.e. debugging. some could do it. many in tech don't even like tech.
I mean, brains transfer to any job, and it’s tough to be a developer if you’re genuinely stupid. So in that respect, sure. But I’m definitely not saying that developers aren’t smart enough to do blue collar work.
I agree. I am not naive! I would not be doing it as a lifestyle choice though. I'd do it because I need to. I have worked in a factory before so culture shock wont be there at least. I get my pay would half (luckily I am not on the US West Coast monster TC so merely it would half).
Agree having made the switch from construction -> Tech job. Having sat around at least 25,000 tech related meetings until now worked with thousands of people in various roles in tech, i could count on my one hand the number of people from each tech company I worked that could qualify to survive the real blue collar world.
Hate to see you in gray, I went from dropout waiter to Google via my own startup in between. And you nailed e v e r y t h i n g, I am screenshotting this and reading it over and over again for years to come. Great writing too. Cheers.
I don't believe SaaS is a good option in this sector - the incumbent VSaaS is decent, cheap, and ubiquitous. By "tech-enabling", I mean layering tech into the ops where it adds value and helps to scale the business. Obvious wins are upselling, hands-free data entry to the CRM, smart traps/stations. My choice is to compete as a tech-enabled operator, rather than sell AI/SaaS to incumbents.
Similar boat here. Many of these service industries are cheap. I've built my own CRM/management system that no big company will ever touch. Even if I can sell to 1000 companies and charge them $25 a month...I'd have staff overhead, maintenance to support it. SaaS isn't some little photo editing app or something you can just launch and forget.
I'd rather grow my business and make as much money. If I can crush it with my business I'd make more than that.
Yeah agree - software needs to either do a ton more, be much cheaper, have network effects (such as connecting supply and demand), or some data benefit to avoid being built in-house or replicated.
Also for me there's an element of picking the pain I want to solve for. I've run a software company before, and prefer the tech-enabled route personally.
I agree a lightweight franchise would be attractive, though I don't like most franchising options due to the fees and lack of equity build up for the operator.
Some franchising platforms (window cleaning is a good example) don't offer much beyond sales and marketing support and some nicely designed uniforms. There's not much to window cleaning other than basic equipment, so a person's route can easily be disrupted by a new entrant who doesn't have the franchise rake to contend with.
There's a model between employment, ownership and franchising that will probably emerge as sales, marketing, ops gets easier technically.
You took a job as a tech in order to learn about pest control business so you could build a SaaS platform? Do I understand that correctly? In the end you decided not to build a SaaS and started your own pest control company?
I wanted to get in the field for real, see how it works. There is going to be a lot more people exploring blue-collar work as white collar jobs are eliminated. I plan to acquire the traditional operator I've identified, and tech-enable it. If that works, grow it as a platform by either acquiring other companies or attracting technicians over.
Congrats, and genius move. And great hustling, show's there's no way out of hard-work.
Reminder to myself to pick an industry that's always gonna have demand. We recently paid ~$200 for a 30 minute visit to seal off like 3 tiny holes around the perimiter of our house because of mice (actual cost of materials ~$5).
Lots of guys working at the big companies do this type of work (called exclusion) on the side. One guy where I worked charged a restaurant $8k for exclusion work that took 2-3 days out of hours and $500 in materials. I asked the company why we let this work go - they don't want the liability and relative hassle compared to steady service routes.
also starting in a blue-collar field soon as an operator-ish in a facility management company. I've already lined up an awesome new SaaS in the main industry. Pest control will be one of the verticals the company has customers fo so I will be keeping an eye for it, was thinking of just starting a pest control business it self.
Does your software do anything fancy or is mostly for organization, good workflow, and being the central source of truth?
Did it require a lot of development after getting a few customers on boarded?
I love this, the perfect antidote to all the stupid startup-bro grind bullshit posts.
You put in real work to understand the business landscape and typical pain points. With AI, implementing solutions has become much easier but knowing what the problems are and how to solve them hasn't.
How long was the employment at the pest company? At any point, did anyone treat you like you were stealing their business? I thought about this approach, but I chickened out many times because of the possible confrontation.
Assuming everyone knows your acronyms is just not a good writing style.
Since I couldn't understand how s/w was going to get opossums out of anyone's basement, I think the correct decision was made: hands on!
You deserve accolades for making this choice. Good Job!
Like any physical trade, this is by it's nature a local only endeavor. So a web presence that is primarily visible to geographically local potential customers would be most effective.
Any aggregation is really just a way to skim some of the profits from the people actually doing the job. That is to say, GTM according to my definition above.
Personally, when I can't get an in-real-life personal referral to some trade, and I'm forced to do web search, I always spend extra time to try to find a web page that is put up by a local company, not an aggregator.
Things like plumers.com (this is a totally made up example, not referring to any real website) I find to be extremely irritating. Since they have absolutely nothing to do with whoever will eventually show up and do the work.
This form of aggregation through, is extremely common today, and a very large part of why the modern internet sucks.
craigslist.com (the actual website) used to be a good example of referring local services, until it was overrun with spammers and scammers.
Will this correct? Will we proceed to the dead internet? Who knows! What next weeks exciting episode to find out...
For residential / consumer markets, referrals are the gold standard and I agree to an extent about the local focus. A lot of PE (private equity) backed roll-ups result in a worse customer and worker experience as they try to force scale too fast.
Some PE companies will open a local market by initiating acquisition conversations with all local players, low ball everyone, buy some and for a short period dramatically reduce pricing to force the hold-out cohort to sell at an even lower price. Not good for communities.
The unlock to balancing scale and customer / worker experience is creating the right incentives for people to adopt the behaviors you're after. This is why bolting on SaaS or AI to established companies is tough, as the staff often don't want to change and will leave - which is bad in a tight labor market.
Searching for home services online is totally broken and is a tax on buyers and operators. HVAC contractors pay on average $600 for a closed lead from online ads, and close about one in four / one in five leads.
If you read his post, there's significant effort not "catching opossums" but waiting or churning through admin overhead - wasted time, which maybe he can translate into $. This much inefficiency is...common in many businesses.
This might be a bit of a gold rush of sorts at first, in that the first people to transition from tech to running a small business, whether tech-enabled or not, will find a bigger piece of the pie waiting for their taking. But as the stream of many others increases over the years, the pie's slices will get smaller as competition for the same market segments increases. Not trying to paint doom and gloom, just that I'd imagine, as the author says, this kind of white to blue collar shift will accelerate, and as it does, competition will rise, lowering the chance for overall profits.
In my limited “ai transformation” experience the biggest gains seem to be just forcing down some of the walls between these different systems. Larger, more well run places were probably integrating all of their systems/data/etc so there was none of this low hanging fruit. It seems AI as a forcing function of combining data sources to feed into the AI just had the beneficial side effect of connecting all the crap.
Sounds great for people who need pest control tool services!
Is it a gold rush or a pie eating contest? (I need to know if I should be selling shovels or forks).
That said, this guy is a superstar. This kind of application of skill to a totally different business paradigm to improve it is what I'd love to spend my time doing. Knowing my personality, once I improved the business, I'd get bored running it and move on to finding something else to improve.
I liked that you picked a service that has a relatively low barrier to entry. The real asset are local operators and referrals. Making them more efficient without being controlled by a big company would be a boon for everyone involved.
Consider being a platform coop with regional operators as members. See https://platform.coop/
I’ve never heard of platform Co-ops. Cool! Lots of people predicted that a beloved local coffee shop was doomed to fail when the workers got a loan and bought it to run as a completely flat cooperative. It’s been a few years and they are absolutely killing it. I’d love to see the tech version of that.
There is still much to be worked out, but some smart people are working on it. See also https://e2c.how/
Thanks! Cool initiative. I’ll look into it.
Yes, the barrier here is the desire to study and pass the exam. If willing, you are up and running relatively quickly - but only as a technician under someone else's operating license. To get the operator license (eg to be a full on pest control company) requires 2+ year documented experience and another set of exams.
The operating license holder is also on the hook for legal action if (when) things go wrong.
"Control" is interesting and I have found in all trades that people value their freedom. The good companies don't monitor employees too tightly, and are rewarded with loyalty and longer tenures generally. Of course you have to run a good recruitment and referral process to find the good people!
Doing something similar. Bought a business in the petroleum equipment service space. Building internal tools for ourselves. Pen and paper still dominates the industry.
Would you recommend buying a business over starting one from scratch when possible?
Depends on the industry and your experience plus your access to capital. Sorry for the non-answer
Does it matter that pen and paper dominate? How much of the business's expenses are overhead?
I'd love if this ends up being he gets a 1m/y pest control empire going and quits tech startups as he prefers the sweaty kind.
This is going to be the route for a lot of white collar people as they lose their jobs to AI.
Absolutely. I am thinking what my blue collar alter ego will be.
I hate to be the bearer of bad news, but as a recent white->blue collar convert, (union metalworker,) tech workers are usually far less qualified than your average vocational high school graduate, way less physically capable, and waaaaay less tolerant of the sort of workplace unpleasantries in these types of jobs at the entry level. Your tech experience gets you pretty much zero advantage, and there are lots of very smart people outside of the software world that have put a whole lot more thought into that industry than you have. Consistently high labor demand meant companies had to comparatively treat tech workers with kid gloves, and as a result, most don’t realize how much smoke has been blown up our assess for decades. They start as soft, arrogant, maladroit noobs who will cosplay as working class for a couple weeks and either eat crow and stick with it long enough for their boss to not want to throw them off a bridge, or give up/get fired and try to pay the bills doing zero-entry-barrier gig work. I was fortunate enough to have been a blue-> white collar covert a couple of decades ago so I knew what I was getting into. The fantasy that a tech worker landing in a blue collar field will naturally rise above the rabble and shoot to the top is a workplace version of the fantasy where a white person finds themselves in some jungle full of “savages” and is so inherently impressive and sophisticated that they’re immediately made king.
yeah. there absolutely are lots of very smart and capable people outside of tech. as someone who has seen the blue collar world "up close" (family businesses), its a different breed... the culture and attitude gap is enormous. shockingly so. most tech workers I know couldn't hang (don't hustle as hard, risk averse, liberal), but some skills may transfer, like problem solving and diagnosis, i.e. debugging. some could do it. many in tech don't even like tech.
I mean, brains transfer to any job, and it’s tough to be a developer if you’re genuinely stupid. So in that respect, sure. But I’m definitely not saying that developers aren’t smart enough to do blue collar work.
I agree. I am not naive! I would not be doing it as a lifestyle choice though. I'd do it because I need to. I have worked in a factory before so culture shock wont be there at least. I get my pay would half (luckily I am not on the US West Coast monster TC so merely it would half).
It’s far worse in the restaurant industry. We’re going to see a lot of really awkward concept restaurants and bars open and close in quick succession.
Agree having made the switch from construction -> Tech job. Having sat around at least 25,000 tech related meetings until now worked with thousands of people in various roles in tech, i could count on my one hand the number of people from each tech company I worked that could qualify to survive the real blue collar world.
Hate to see you in gray, I went from dropout waiter to Google via my own startup in between. And you nailed e v e r y t h i n g, I am screenshotting this and reading it over and over again for years to come. Great writing too. Cheers.
Haha, thanks. It’s bobbed up and down around that zero a few times. People that know it’s true vs. people that may soon find out that it’s true.
Interesting pivot. What I don't understand is how the SaaS software fits into it or helps grow a pest control company.
I don't believe SaaS is a good option in this sector - the incumbent VSaaS is decent, cheap, and ubiquitous. By "tech-enabling", I mean layering tech into the ops where it adds value and helps to scale the business. Obvious wins are upselling, hands-free data entry to the CRM, smart traps/stations. My choice is to compete as a tech-enabled operator, rather than sell AI/SaaS to incumbents.
Similar boat here. Many of these service industries are cheap. I've built my own CRM/management system that no big company will ever touch. Even if I can sell to 1000 companies and charge them $25 a month...I'd have staff overhead, maintenance to support it. SaaS isn't some little photo editing app or something you can just launch and forget.
I'd rather grow my business and make as much money. If I can crush it with my business I'd make more than that.
Yeah agree - software needs to either do a ton more, be much cheaper, have network effects (such as connecting supply and demand), or some data benefit to avoid being built in-house or replicated.
Also for me there's an element of picking the pain I want to solve for. I've run a software company before, and prefer the tech-enabled route personally.
The software for businesses like this is tightly intertwined with operations. Hence, it's less of a SaaS and could be more like a franchise model.
I agree a lightweight franchise would be attractive, though I don't like most franchising options due to the fees and lack of equity build up for the operator.
Some franchising platforms (window cleaning is a good example) don't offer much beyond sales and marketing support and some nicely designed uniforms. There's not much to window cleaning other than basic equipment, so a person's route can easily be disrupted by a new entrant who doesn't have the franchise rake to contend with.
There's a model between employment, ownership and franchising that will probably emerge as sales, marketing, ops gets easier technically.
You took a job as a tech in order to learn about pest control business so you could build a SaaS platform? Do I understand that correctly? In the end you decided not to build a SaaS and started your own pest control company?
I wanted to get in the field for real, see how it works. There is going to be a lot more people exploring blue-collar work as white collar jobs are eliminated. I plan to acquire the traditional operator I've identified, and tech-enable it. If that works, grow it as a platform by either acquiring other companies or attracting technicians over.
Congrats, and genius move. And great hustling, show's there's no way out of hard-work.
Reminder to myself to pick an industry that's always gonna have demand. We recently paid ~$200 for a 30 minute visit to seal off like 3 tiny holes around the perimiter of our house because of mice (actual cost of materials ~$5).
Lots of guys working at the big companies do this type of work (called exclusion) on the side. One guy where I worked charged a restaurant $8k for exclusion work that took 2-3 days out of hours and $500 in materials. I asked the company why we let this work go - they don't want the liability and relative hassle compared to steady service routes.
Love stories like this, where someone learns some completely orthogonal domain for educational purposes.
There is definitely money in the pest control SaaS business, mine is running at $2M ARR for a few years now.
There are lots of antiquated operators not having newer technology for pest control, which makes this area lucrative for even $50K MRR.
Go for it!
also starting in a blue-collar field soon as an operator-ish in a facility management company. I've already lined up an awesome new SaaS in the main industry. Pest control will be one of the verticals the company has customers fo so I will be keeping an eye for it, was thinking of just starting a pest control business it self.
Does your software do anything fancy or is mostly for organization, good workflow, and being the central source of truth?
Did it require a lot of development after getting a few customers on boarded?
are you a 1 man show?
Congrats - what's the company called?
I love this, the perfect antidote to all the stupid startup-bro grind bullshit posts.
You put in real work to understand the business landscape and typical pain points. With AI, implementing solutions has become much easier but knowing what the problems are and how to solve them hasn't.
How long was the employment at the pest company? At any point, did anyone treat you like you were stealing their business? I thought about this approach, but I chickened out many times because of the possible confrontation.
So how is hiring going to be handled at this new company? Is he expecting people to just show up and start working?
We will recruit technicians who are aligned with the tech-enabled approach.
GTM? Does that mean Get The Money?
Assuming everyone knows your acronyms is just not a good writing style.
Since I couldn't understand how s/w was going to get opossums out of anyone's basement, I think the correct decision was made: hands on!
You deserve accolades for making this choice. Good Job!
Like any physical trade, this is by it's nature a local only endeavor. So a web presence that is primarily visible to geographically local potential customers would be most effective.
Any aggregation is really just a way to skim some of the profits from the people actually doing the job. That is to say, GTM according to my definition above.
Personally, when I can't get an in-real-life personal referral to some trade, and I'm forced to do web search, I always spend extra time to try to find a web page that is put up by a local company, not an aggregator.
Things like plumers.com (this is a totally made up example, not referring to any real website) I find to be extremely irritating. Since they have absolutely nothing to do with whoever will eventually show up and do the work.
This form of aggregation through, is extremely common today, and a very large part of why the modern internet sucks.
craigslist.com (the actual website) used to be a good example of referring local services, until it was overrun with spammers and scammers.
Will this correct? Will we proceed to the dead internet? Who knows! What next weeks exciting episode to find out...
Go to market - e.g. how to sell your thing.
For residential / consumer markets, referrals are the gold standard and I agree to an extent about the local focus. A lot of PE (private equity) backed roll-ups result in a worse customer and worker experience as they try to force scale too fast.
Some PE companies will open a local market by initiating acquisition conversations with all local players, low ball everyone, buy some and for a short period dramatically reduce pricing to force the hold-out cohort to sell at an even lower price. Not good for communities.
The unlock to balancing scale and customer / worker experience is creating the right incentives for people to adopt the behaviors you're after. This is why bolting on SaaS or AI to established companies is tough, as the staff often don't want to change and will leave - which is bad in a tight labor market.
Searching for home services online is totally broken and is a tax on buyers and operators. HVAC contractors pay on average $600 for a closed lead from online ads, and close about one in four / one in five leads.
I read it as Google Tag Manager, lol.
https://en.wikipedia.org/wiki/Go-to-market_strategy
GTM is ubiquitous on the business side.
If you read his post, there's significant effort not "catching opossums" but waiting or churning through admin overhead - wasted time, which maybe he can translate into $. This much inefficiency is...common in many businesses.
s/w? Does that mean sidewalk?
bizarre take and writing style. if the saas enables them to be more efficient it's overall net positive