SBM #23 - John Wilson - Building a home services empire 

Building a home services empire.

 

In the last edition, we explored Patrick Dichter's journey as an acquisition entrepreneur in the accounting space and the lessons learned along the way.

This week, we're diving into the world of home services with John Wilson, owner of the Wilson Companies, an established player in the plumbing, HVAC, and electrical space.

Fast Facts:

  • The US home services industry is expected to see 53% growth between 2020 and 2024 

  • The market size itself was valued at $90.46 billion in 2023 and is projected to reach $156.29 billion by 2030 growing at a CAGR of 7.1% from 2024 to 2030 

  • Consolidation and private equity interest in the home services space has been on the rise, with several large players emerging through acquisition

Chart:

Overview: 

John Wilson owns Wilson Companies, a multi-trade home services business specializing in plumbing, HVAC, and electrical services. 

When John took over The Wilson Companies in 2016, he grew it from $1 million in revenue to a projected $26 - 28 million in 2024.

His goal? $100 million.

The Story:

John Wilson's journey in the home services industry is a testament to the power of strategic growth, differentiation, and a relentless focus on reinvestment.

But to better understand his journey we have to start at the beginning.

John Wilson's company began in 1958 when his grandfather Ralph launched a business with 500 dollars and a pickup truck. 

It was the American dream. Several decades later, John’s father took over the company and grew it to $1m in revenue.

John joined the business in 2016  and he and his father worked together up until 2019 when John took full control.

The Wilson Companies is the searcher's dream. When investment bankers and private equity analysts close their eyes and dream about entrepreneurship through acquisition (ETA), they think about John’s company.

Home services in Ohio are the sweet spot.

But it didn’t start that way. A $1m company is not that attractive. John has built his empire methodically over the last 8 years.

He has been a student of home services and focused on building a brand in a local area. He has used acquisitions to expand into new service lines beyond plumbing like electrical, scale operations, and acquire talent.

He also started before home services were all the rage in Stanford ETA classes.

The home services industry was perfect for consolidation and growth. There were and are multiple $100m plus companies but the average competitor is worth sub $5 million. 

Those facts proved that there was a scalable model to grow large but that most of his competitors couldn’t or wouldn’t adopt it, leaving lots of subscale companies to acquire. 

This isn’t true in all home services. As John points out, there are no or very few home cleaning companies worth $100m and most are sub $1m. That is not an attractive vertical. 

John also noticed that combining what he calls, “the big three (plumbing, HVAC, & electrical),” was more efficient as those services all cross-sell and require licensed techs. Licensing provides companies with a moat to protect against any Tom, Dick, or Harry entering the industry.

The Wilson Companies chose the multi-service path to growth in order to concentrate on one geographic area. To grow a plumbing pure play, eventually, the company would need to expand to new and more distant geographies.

John rejected this option for two reasons. First, building a local brand makes launching new service lines easier. Hopping geographies means you are constantly re-marketing the brand.

Second, John is a family man and didn’t want to be on the road checking in on his companies while his children were young.

With Wilson Companies on track to hit $26-28 million in revenue this year, with an ambitious goal of reaching $100 million, it seems like John made the right choice.

Keep an eye on this guy. He’s a strategic thinker and we’ll be seeing a lot more from him.

I think John and Wilson Companies did three things right

  1. Choosing the Right Services: John's focus on plumbing, HVAC, and electrical services – the "licensed home services" – allows for significant cross-selling opportunities, leverages his brand, and opens up a large total addressable and local market. By targeting services with a mix of recurring maintenance and high-ticket installations, he's built a business with strong growth potential

  2. Investing in Infrastructure Early: The Wilson Companies made key investments in CRM, fleet management, and enterprise mobile systems early on when revenue was just $1-2 million. While expensive at the time, these decisions have paid off, providing a scalable foundation for growth. John was planning to be big from the start 

  3. Balancing Organic and Inorganic Growth: While acquisitions have played a role in the Wilson Companies' growth, John recognizes the importance of organic growth as the business scales. By focusing on lead generation, differentiation, and building a moat, he's positioning the company for sustainable expansion

John is also thinking ahead to the future by focusing on:

  1. Developing a Training and Onboarding Process: As the Wilson Companies grow, John has identified training and onboarding as a key challenge. Developing a robust, multi-week onboarding program will be critical to getting new techs up to speed more quickly while maintaining service and performance standards and hitting growth targets

  2. Planning for the Future: With a clear vision of reaching $100 million in revenue, John is already thinking about the challenges and opportunities that lie ahead. From expanding into new markets to potentially spinning off the company's lead generation capabilities, he's laying the groundwork for long-term success

John's story serves as an inspiration for entrepreneurs in the home services space looking to scale their businesses. 

📅 Next Week:

Next week we’ll take a look at the optometry business and an entrepreneur named Ankit Patel who is making some waves there. 

Keep growing,

Alan

P.S. 

The most recent episode of The Small Business Mentor Podcast is live. My guest this week was Loren Feldman the journalist turned entrepreneur. We went into a lot of detail focusing on how the media industry has transformed over the last 10 years. 

Check it out here: 

P.P.S. 

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