DS _Andrew_107_ Ready for Review/Final Touches
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[00:00:00] everything changed.
[00:00:01] The conversations that I had with operators with partners was completely different it was us as a pest control marketing agency among a handful to, we are the only ones. serving who we serve. And because of that, when the operator who matched that size of company and that psychographic heard us talk in that way, read the copy on our website, they go, wow, that is me.
[00:00:28] the power of positioning in marketing never fully clicked until that moment
[00:00:33]
[00:00:46] Today we have a guest who embodies the very essence of deep specialization.
[00:00:53] Andrew Peluso is the founder of Pesty Marketing. His agency focuses on helping pest control companies scale past the million dollar mark and achieve 30% or greater annual growth. Today we're gonna hear about his journey from starting his first agency back in 2016. What led him to launch his second agency in 2019?
[00:01:16] And finally his current agency, Pesty. I'm super excited to have him on. Welcome, Andrew. Thanks for having me, Corey. I'm excited to, hopefully offer some value to, our listeners today. I'm sure of it. It's gonna be great. let's start with, let's go back to 2016. Right before you started your first agency web sauce studio.
[00:01:37] What was happening in your life that told you that, Hey, I need to start an agency? Like what was happening back then? So this is gonna come full circle, because I was selling, I had been selling pest control door to door for a couple of years. That's wild. And one day it dawned on me that it would be a lot cooler if people came to me, looking to buy pest control, rather than me going door to door selling pest control and started teaching myself SEO and website design.
[00:02:08] Took a course on starting a website design business. Creating designs in Photoshop, finding freelancers on Upwork or whatever other freelance platforms there were at the time. And yeah, kind of learned that, you know, in, in the world of service businesses, that SEO was the name of the game if you wanted leads.
[00:02:28] And a friend of mine approached me and said, you know, I don't really wanna learn marketing, but I really enjoy website design. So do you wanna partner up and I'll give you a commission for any, clients, you end up bringing my way by doing, SEO to our website and Google Maps and all that.
[00:02:48] and so that was all what led to Web Sauce. Was he already building websites or was this a brand new venture for the two of you? He was already building websites, in freelance capacity, wasn't really getting clients and. Didn't really wanna figure out how he was good at sales, but he didn't know how to get the leads to begin with.
[00:03:06] and at that time, What, what was the makeup of the clients? So the first website we ever ended up actually building together, I think was $300. And it was these, uh, these two, I believe it was educators. And they wanted a website for their, consulting business.
[00:03:26] And then clients, because I was starting to get them in Sacramento from Google, people searching for website design Sacramento, through Google Maps. at the time UpCity was just getting started and we were getting good leads there. it was small local businesses, a couple of which I actually are still clients of mine, today.
[00:03:48] So it was, one was a company that sells SOD throughout California. Another was a home mobility equipment company. at the time they were just selling stair lifts and it was all over the map. and we were pretty much saying yes to whatever came our way. Sure. And that's a very common way for people to get into business.
[00:04:07] Right. Especially, were you moonlighting at this time or was it a full-time gig? It started off as a side gig. I believe actually at the time, my full-time job was as a home security technician, so I was installing security systems, but the real job was sales. The installation part was easy, but you went in, you know, with the goal to upsell those jobs.
[00:04:30] And, eventually it got to the point where I decided that I was going to do the. Website design agency thing full-time. And at what point did it make sense for you to go full-time back then? Just when I was excited enough, we were getting a decent amount of work. I always had a sort of entrepreneurial spirit.
[00:04:48] I knew I wanted to run a business when I was, say like 16. I didn't have any kids. I didn't really have any major responsibilities. Rent was cheap enough. And so for me, it just came down to, you know, do I have a couple months of savings and do I feel like I can jump into this, and make it work?
[00:05:07] So, fast forward three years, right before you launched your second agency. What was happening in the business that caused you to decide to part ways? my business partner and I, who at the time and still is one of my best friends, the business was not going well. We were. Both feeling a lot of stress, unhappy with how the other person was handling certain things in the business and we just weren't making money.
[00:05:31] You know, we had been struggling for a couple of years and, I decided I wanted to take the business one direction. He wanted to take it another, so I bought him out of our marketing clients and walked away with the clients who wanted me to do their marketing, he walked away with a few design clients and the brand and the agency and all of that.
[00:05:53] And I went and started bananas and he kept going with Web sauce. maybe six months later, web Sauce was acquired by a development agency, basically in Acquihire, purchased the brand, purchased the funnel that we had going and hired Adam as a partner in that agency.
[00:06:10] That's where he still is today, actually. Interesting. So he went basically in-house? Yes. Yeah. And so you mentioned, I, I'm thinking back at this time, so this is about 2016 to 2018. I joined Scorpion back in 2015. And so I'm, I'm, I remember decisions I made back then that I would probably decide make different decisions today.
[00:06:30] And, and I'm curious, you mentioned you guys were, sounds like you guys were butting heads, wanted different things, a little bit of stress. What do you, what do you think was the cause looking back now, maybe there's some wisdom of time and experience that was causing that stress.
[00:06:43] I think that the cause of arguably most stress in anyone's life is just insecurity. I was very insecure. and from that manifested all sorts of, issues, self-doubt, very low self-efficacy. similarly with Adam, he was struggling. We were struggling collecting our invoices on time, and it was just taking forever for us to get paid, and part of that was being insecure about asking for the money that we were, you know, and being afraid to, lose clients.
[00:07:15] so yeah, it was insecurity and, just immaturity, too much partying on the weekends, not enough heads down, being focused and working. about what age were you back then? Let's see, started bananas. April 1st, 2019. I'm 33 today. That was six years ago, so I would've been about 27.
[00:07:37] Prime of your youth? Yeah. Okay, so. Things were going a little bit rocky, struggling with, collecting invoices and there's complications related to that. And then, Adam basically, web sauce got acquired, or Acqui hired, Adam stayed in house. And then did you have an offer to go work for that other agency, or was it clear that you were gonna move on?
[00:08:00] No, and I had already, we had already parted ways at that point. Yeah. Okay. Got it. Yeah, we had parted ways I learned from web sauce, that I, I needed to take seriously niching down, and I didn't end up niching down enough, but I had heard that, you know, hear the term that, riches are in the niches.
[00:08:19] And I heard that enough and, and learned, through the, you know, firsthand experience that that seemed to be, that theory was true. So decided to start Bananas Marketing and, and thought at the time that was niche enough. so help, help, help us understand what was true in the business at the time that that was, that told you that you needed to niche down, like, and specialize.
[00:08:41] Because at Web Sauce, we were mediocre at everything we were doing, and it was too difficult to scope projects. because we were mediocre at everything and did so much. We, couldn't charge a premium. You know, we couldn't charge as if we were the best, 'cause we weren't the best.
[00:09:00] we constantly dealt with scope creep. We didn't know what we were getting ourselves into when we were saying yes to things. And it just felt, you know, you feel in your gut when you're accepting a job that you don't really know what you're doing. the last few projects were kind of iffy in terms of, how they went
[00:09:21] Just constantly saying yes to new things. Yes. To social, yes. To email, yes to SEO Yes. To paid ads and all the while trying to do it all and learn it all yourself and just, you know, and then having to hire someone because you wanna focus on other things, and then having to let them go because you're spread too thin.
[00:09:40] You don't know what you're doing. I knew I had to niche down because there were just so many signs that trying to do too many things for too many different companies was just clearly not working. And I was better off, you know, learning from the wisdom of others. so what did you do differently at Bananas Marketing your second agency, which I believe you started in April of 2019.
[00:10:02] we went from doing website design and development and app development and design and doing all sorts of marketing under the sun to really just focusing on digital marketing for service businesses service businesses. Could be professional services, home services, really anything that requires some kind of lead generation with a regional focus, you know, geographical focus, local, yep.
[00:10:29] Yeah, local. and we would still do some web website design. I still had this hard time saying no to, you know, some of those other things, but I was getting better at focusing on the clients that I had gained more experience with at Web Sauce.
[00:10:44] Why wasn't that niche enough? I guess a couple reasons. One, there was still no competitive advantage for us. You know, it was like, yeah, I could say that we specialize in working with service businesses, but that doesn't resonate very strongly, in, in all these different industries. You know, like a landscaping company, a pest control company, a law firm, an accounting firm, and, and we had all sorts of different businesses and yeah, it's, it's lead generation.
[00:11:11] Yeah. It's local. Yeah. It's a service. But if you are a pest control operator and you read, you know, you're online looking at a website that says we're a marketing agency for service businesses, you don't identify with that. Right? Yeah. You know, it's not obvious. It's not obvious.
[00:11:31] We're still gonna really struggle to be the best at what we do. there are important foundations to marketing that apply largely across the board. but then there are nuances, between different types of marketing and also different industries that are what becomes really important if you're gonna be the best at it.
[00:11:50] And the learning curve of understanding the nuances of all these different industries. It was fun because I got to learn about different business models, different industries, and so I got a lot of value out of it, but I probably got a lot more value out of it than my clients did at the time.
[00:12:06] And we did some good work, you know, like I said, we still have clients from back in the day, but we still weren't the best. And it doesn't feel good in my gut to not be the best. and not be striving to be the best at what we do. So, that's when I kind of continued to understand organization.
[00:12:22] Yeah. It's funny as you, as you were sharing that, I was thinking back. So when I started at Scorpion in 2015, it was primarily law firms. I was our niche. And of course our CEO is, Rustin very ambitious, wants to help a lot of businesses. so we wanted to expand into a new vertical.
[00:12:41] And I remember one of the drivers for that initial decision was, where's the spend on Google? where are the big sort of service based businesses? what are the biggest spenders, of course, home services, HVAC and plumbing. That was the first place to go look.
[00:12:56] And I remember going through the process of going from, oh yeah, we'll just specialize in home services to realizing kind of the same journey as you, which is that. The HVAC business is very different than the plumbing business. Like these are two different buyers, two different personas, two different industries, if you will, right?
[00:13:16] there's all this nuance and pest control. Obviously, where you landed is a whole nother one. Landscape is a whole nother one, realizing, oh, shoot, they have their own conferences, they have their own, influencers, their own, you know, publications, associations, and like, as you go deeper and deeper, like there's all this, detail and depth to all of these sub-verticals that I don't think we were ready for.
[00:13:40] 'cause we wanted to do everything as well. And we, of course, we ended up focusing initially on HVAC and then plumbers and then we did get into pest control. But what we did is we hired different sales teams, to go after each vertical or sub-vertical within home services to kind of, approach it.
[00:13:59] Yeah, and I find that that is where, a lot of the competitive advantage lies when I can, through our marketing or through my sales conversations, or even just while passively networking, understand my client's business and their customer better than they do, the sale is no longer a sale because I am simply there to educate and offer value, and all of a sudden they want to work with me.
[00:14:32] I don't have to do a lot of selling because they're like, wow, this person understands my business better than I do. They understand some of the metrics that I know I should know better than I do. And even now when I interview some of our clients and I asked them. Where do you get the most value out of working with me and my team?
[00:14:52] some of them will say, well, you just know so much about the industry and all these different businesses across the country and so beyond just doing the marketing for us, when we get to meet with you every month, we get to learn a lot about these other areas of the business where we can clearly do better.
[00:15:11] And then you actually have specific guidance on ways we can do better or resources you can point us in the right direction to help us understand where we can do better. a lot of our clients just find a lot of value in that, but that's only possible because I've spent, the last several years deeply understanding the business.
[00:15:28] listening to, over a hundred hours of podcasts and watching YouTube videos and, Reading research from, an m and a firm in the space that talks about the pest control industry and the business, and being really curious about my clients and their business and how they operate and do things.
[00:15:45] so that depth of knowledge is where, in my experience, it just doesn't seem like our competitors can really, keep up because they just know so much and that really becomes a moat. Because if you have competitors, who say, yeah, we work with pest control businesses.
[00:16:01] they're not in a position to really understand the buyer or the nuance of the industry or, the details that really matter to the pest control companies. That becomes your moat through specialization, right? Yep, yep. It's almost like the, what you're doing and others who've done similar things is it's almost like you're leaving the.
[00:16:23] Internet marketing industry, and you're actually joining the pest control industry, you become a part of their world. You understand, you go to their conferences, you understand their, their, their core challenges as an industry. And when you're able to not only understand that, but but be a part of the solution, it's very powerful.
[00:16:40] A hundred percent. A hundred percent. Yeah. You know, obviously we, we see our competition in terms of marketing agencies. Yeah. And, we, we know who they are. 'cause I ask, and I, I know who we compete with from a, you know, paid and organic perspective. But, we don't pay too much attention because we are doing things differently and we're really focused on the, the specific industry that we're, we're working in.
[00:17:10] and then we even it helps us put together marketing material and sales assets that, we're just highly valuable. Like I have a. a Google doc that I have put together over the years called the Pest Control Business Playbook. And it's got all sorts of juicy notes and gold nuggets for the industry about, what is it that an m and a firm looks for?
[00:17:30] Or what is it that an acquirer such as, such as, you know, terminex, what do they look for when they're looking at a pest control business? What are those KPIs in different parts of the business, either from a growth perspective, from a route density perspective? and with that list of notes, when I share that with someone, I mean, they're just blown away because the amount of gold in that document is really valuable and important for, prospects to understand.
[00:17:59] and so I love continuing to refine that document and update it. And I also really enjoy sharing it with pest control operators 'cause it's so valuable. You can imagine their experience when they're shopping for an agency and they talk to one agency who is providing effectively business consulting and expertise.
[00:18:16] and then they talk to another agency that's talking about, you know, SEO and you know, how great their SEO tool is two different worlds effectively. solving the same problem, but there's just so much more, value built into the way you're approaching it. It's really cool.
[00:18:32] so when did Bananas Marketing become pesty? Or are these two different businesses how did that happen? Yeah, they're two different businesses. I had purchased marketing pest control.com pretty soon after I started, bananas.
[00:18:46] I just saw it was available and I knew the SEO value of that, you know, exact match, phrase as it for a domain. And had been sitting on it for a while, but was focused on bananas, focused on our clients, wanted to make sure that business had some amount of sustainability. And then came across, someone who had successfully founded and, sold a dental marketing agency and, told him that I, had aspirations to start a pest control marketing agency.
[00:19:20] And this was after I had sort of thought through, was I gonna do pest control or a different industry landed on pest control, but didn't quite pull the trigger. Once I found this person who, I felt like I could learn a lot from and who would be a good co-founder, I decided to start it. And this would've been, the conversations would've been in 2021.
[00:19:40] And then it wasn't until 2022 until we really started getting going. I lost my mom in 2021, the middle of 2021. That kind of, ended up taking up a lot of mind share to, work through that with her and my family. in 2022, we really pulled the trigger. We found a third co-founder that first co-founder didn't end up working out, so he left the business.
[00:20:03] So it was early 2022 that, we started moving forward with pesty. the nice thing about starting a marketing agency and I guess owning the business was I was able to, move back to be close to my mom and, didn't have to ask anyone permission to do that.
[00:20:18] So I got to spend the last six months with her, very intimately. It was very, healing for both of us. So. Mm-hmm. That's beautiful. So, kind of shifting back to the, business that you started in 2022, you decided to go down the road of bringing on partners versus employees. There's pros and cons on either side.
[00:20:39] I'm curious what your thought process was, given the fact that you'd already had a couple of agencies, you knew what it was like to run one and you decided to partner instead of, just hire as employees. Yeah. So the first, the first person I decided to partner with, I, I wanted to work with him because, he was just gonna fast track my ability to get this thing off the ground and find success.
[00:21:01] And then the, the second co-founder, eventually stepped back into an advisor role, you know? Yeah. He had significant amount of experience in startup world, BC world, and just, had a lot on his plate and, didn't want to go down the agency route and the capacity that, Anything, above and beyond an advisor was going to entail.
[00:21:22] So I ended up with 98% of the company and he ended up with 2% of the company, and he's still an advisor today. He was the one who decided on the name Pesty, found the domain, built the original website with his team. Yeah. So he's very creative thinker. very interesting guy who I still meet with every couple of weeks.
[00:21:40] but yeah, even though I originally started with two partners who were kind of working in the business, I ended up with one advisor who was, just there to consult.
[00:21:49] Yeah. It just, it just, that one just didn't work out. yeah, it was just, he wanted something very different than what we were wanting, and for equity that that didn't work for us. And so, just made sense at the time to part ways early. Any lessons learned from that experience?
[00:22:04] I mean, I think the lesson I've had to learn, I've been blessed to learn over and over again is to just trust my gut. And, I've gotten pretty darn good at that over the years. And, I think that was just one kind of experience of, listening to my advisor and hearing what both of them were saying, and then paying attention to the actions of both.
[00:22:25] And, ultimately trusting my gut and not overthinking it and deciding that parting ways was what was best. so yeah, nothing real tactical. So in 2022, you started pesty, was it called Pesty in 2022? Mm-hmm. Yeah. That's awesome. I like that name. It's like catchy, you know? Yeah. It's a great name. we have not run into any trouble with the, direct to consumer pesti brand.
[00:22:50] There is a direct to consumer pesti. It's spelled differently. It's P-E-S-T-I-P-E-S-T-I-E. And like I said, they're a direct to consumer pest control company. We're A-P-E-S-T-Y, and we're a marketing agency for pest control companies. I don't think we'll get ourselves into any trouble so far.
[00:23:05] We're fine. but, yeah, it is a good name. So in 2022, you with the lessons learned about the specialization niching down the brand new website, marketing.com. Pesty marketing. Yeah. Great name. What did you do Start building the business in the pest control industry?
[00:23:22] Probably already had some clients, I'm sure, but like, how did you, how did you go deeper into that work? We didn't have any clients actually had a story to tell because I sold pest control door to door a couple years. I even did a little bit of technician work at the time 'cause I was selling pest control door to door for a friend of mine who went and started his own pest control company.
[00:23:42] And, they're now like a top 50 pest control company in the country. So the story I was able to tell was that I was at the ground floor of a company that now is one of the biggest in the country. And I got to see, you know, what, how you get a company off the ground. What does the pest control business model look like?
[00:23:58] And I could speak that language, but to really get things going, we just offered free work. we cold emailed a bunch of pest control companies, maybe a hundred and someone said, yes, we'll let you do a bunch of free stuff for us. So we built a website for them. We did SEO for them, we. sent out a, photography and videography crew to, get photos, of them and the team and videos and yeah, we just tried to do really good work and turn that into our first case study.
[00:24:30] And then we were able to leverage that to say, you know, we have a pest control client and, you know, rankings are improving and we rebuilt our website and all that. And, you know, it just sort of snowballs from there, right? You, you have a case study, then you end up getting another, like a, your first paid client, then you go to the conference.
[00:24:50] I engaged with everyone at the conference. I didn't, we didn't have a booth, but I just went and came from a place of curiosity, just like be a sponge about this industry, about the players, about the business model, about, everything I could, I could soak up and take notes.
[00:25:07] I don't mind introducing myself, asking questions. and so, you know, it just kind of picked up as we got more and more clients. And let's fast forward to today. How do you attract new pest control clients? Several ways. So, at any given time, we rank number one or two for, pest control marketing or pest control marketing agency, I should say.
[00:25:30] so showing up there has been helpful and brought in leads. we've been running Google ads, for pest control marketing keywords. since maybe even, I don't know if day one, maybe about a year in, we started running those ads when we had revenue. that first national pest control conference I went to, I, met someone, ended up, is that PEs?
[00:25:50] Pest World? Pest World, yep. Pest World. Yeah. met, a guy who, was running a, I don't know if his pest control company was the top 100 pest control company at the time, but, he had been following me, for a couple years on LinkedIn after that conference, and liked some of the things I had been posting.
[00:26:06] And, he reached out. And within a couple weeks we had signed, the biggest deal that I had ever, signed biggest retainer we had ever signed by a lot. so, networking at conferences, connecting on LinkedIn, like I sent some cold dms on LinkedIn and we got again, one of our biggest clients ever and a top, 25 pest control company, like about a month ago.
[00:26:30] What else? you know, today I think the majority of our clients have probably actually come through referrals from our current clients. we've just done great work and we have the case studies and results and, good word from our clients to vouch for that.
[00:26:44] we've also put in place a pretty generous referral program. Affiliate program. So, we've had partners refer business to us, but we offer that same program to our clients. any business that gets referred to us or, whoever refers the business gets 10% of revenue from that client for the first year that they are a client of ours, and then 5% of revenue for the second year that they're a client of ours.
[00:27:08] all based on whatever they originally signed. You know, so if it's a $5,000 a month, SEO retainer, from day one, then they'll get 10% of that for 12 months and pretty good. And so, especially because we charge a premium in the space. and we have clients who really badly wanna work with us, but doing so is, a little bit of a stretch for them.
[00:27:31] they're highly motivated to bring that invoice down. And so, you know, once they see us doing good work and they feel comfortable referring us, they do so, and they do so very, gladly. what went into the decision around positioning as like a high value or high, fee based agency in the space?
[00:27:49] Most if pest control is, like most markets, the volume is in the small business. Like there's a lot of probably smaller pest control companies, larger ones from revenue perspective. Sounds like you're morally targeting more of the premium aspect or part of the market. Yeah. Is that right? Yeah. What went into that decision?
[00:28:07] Yeah. combination of those were the clients I really wanted to work with. I have a much easier time, and I enjoy speaking, the language of business. most operators who have not gotten to a million dollars in revenue yet don't quite have that language down. there's a significant amount of education involved in those conversations, which I don't mind, except it just takes a lot of time to get those clients up to speed and help them understand what we're doing, why we're doing it, why it's important, why we need to prioritize certain things.
[00:28:44] we learned the hard way the first couple of years because we were taking on any pest control clients who would say yes. we weren't charging a premium. we didn't go into the market, thinking that, in fact, Pesty in its original form, we would niche down to.
[00:28:57] It wasn't the final version of the niche we would pick, We said, we'll work with any pest control companies who can afford us and who we think we can do good work for. And then we said, this actually isn't good enough. who's been firing us?
[00:29:08] And who have we been doing our best work for? the pattern that emerged after a couple years was the companies who were firing us were typically solo operators. And the reasons they were firing us was because their customer acquisition cost was just way too high. Because they're in the field doing the work.
[00:29:25] They're not picking up the phone, they're not responding quickly. If they respond to a lead, they only do. So maybe once, they don't follow up multiple times through different channels like email, text, phone call, and so we could bring them leads, but if they're not closing them, of course they're unhappy.
[00:29:42] You know, I didn't blame 'em and. I realized that their needs were very different from the needs of the larger businesses that we were doing great work for. So we either had to figure out, a set of services and at a price point that would work for those small operators, or we could double down on what was working.
[00:30:04] And the companies I actually really enjoyed working with most and just go all in on that route. and so from there we decided to go all in on, the million dollar pest control companies doing a million dollars and up with ambitious growth goals. And so I was trying to tap into the, demographic of the business, right?
[00:30:23] A million dollars being a proxy for, do you have enough business sophistication? do you know how to sell, have you built a real business that is sustainable? can you afford. The level of resources that we wanna put towards the marketing plan for you. I also tried to tap into a psychographic of operator,
[00:30:42] Ambitious, right? Not all operators in this space are ambitious. In fact, a lot of them are near retirement age and are comfortable. They've lost their ambition. Nothing wrong with that. but that's not particularly exciting for me or my team because we are very ambitious. We're very competitive.
[00:30:59] We like to move fast, we like to move aggressively. and so when we combined that million dollar and up mark with the, psychographic of ambitious, that was the day that I think we found product market fit because as I put that out there into the industry at conferences with partners, everything changed.
[00:31:18] The conversations that I had with operators with partners was completely different because all of a sudden we went from, it was us as a pest control marketing agency among a handful to, we are the only ones. serving who we serve. And because of that, when the operator who matched that size of company and that psychographic heard us talk in that way, read the copy on our website, they go, wow, that is me.
[00:31:51] And so it was the first time I ever experienced someone going that is me and all of a sudden wanting to work with us in a way that I just never experienced before. the power of positioning in marketing never fully clicked until that moment in that experience. and I imagine that you had to go through a lot of the experiences leading up to that in order to be able to come to that realization and make those changes.
[00:32:17] Yeah. I suppose had to, only in the sense that my ego wouldn't allow me to listen to, wiser people than I, to get there quicker. Right. Like, I don't think anyone listening to this podcast has to learn all of that the hard way, the way I did.
[00:32:34] and at the same time, they have to be ready to say no to a lot more work than they're saying yes to and to double down on probably a, total addressable market that they think is too small today. What would you do differently? What would I do differently? Just in this whole journey? I mean, niching down, as much as we have, a lot sooner.
[00:32:59] I would do that a lot differently. I would, delegate quicker. what pieces of the business would you delegate? All of the, all of the, in the weeds sort of day-to-day, execution, fulfillment, stuff I would delegate,
[00:33:15] I'll share a quick story. So I went to business school here and by far, it was here in LA UUSC and by far my favorite class was a, it is a entrepreneurial finance, or in business school we called it finance class.
[00:33:29] And it was by a teacher, Steve, who came from the entrepreneurial world and also the venture capital world. So it was a very, intriguing class. But the reason why I loved it so much was because he had extremely high expectations for us and, was expecting the best out of us, but a lot of work out of us.
[00:33:50] And I just responded so well to that. I got, I was like one of the only two people who got an A in that class because I loved the fact that I was being held to, with this very challenging standard that most people didn't feel the need to rise to. So, I get what you're saying. Yeah. And that, so it's pick up the pace, raise the standard, narrow the focus.
[00:34:10] And I think if you, and. You know, Frank Sluman put words to it. But after studying people like Elon Musk, Napoleon, Alexander, the Great Caesar, George Washington, you notice that, that pattern play out very similarly across all just a lot of the greatest leaders in, in, in history. I had read Elon Musk's most recent biography at the same time.
[00:34:35] I read that it would've been like, beginning of last year, and I just decided to go all in on that. And what I found was that, a players respond really well to that. People who are highly motivated, people who, it's exciting for them to work at a company that has that kind of ambition and then executes on it.
[00:34:56] Today, I wouldn't define anyone like in terms of their identity as an A player or not, but if today you're not an A player, I don't think you respond well to those things. whether it's insecurity, right, low self-efficacy, whatever it is. But, to me, those things are my responsibility today.
[00:35:16] And so I just really focus on communicating effectively so that I am not just challenging our team to do all those things, but then also rewarding them when they do those things and, not punishing them if what they're attempting to do are those things. What's an example of how you can reward that type of behavior?
[00:35:42] Yeah. just yesterday I welcomed back, our operations manager from being on maternity leave for a couple of months. And, it was a meeting with her and one of our new account managers, the new account manager's, been with us for about a month or so, part of my introduction to my operations manager, I said, this is our new account manager Mon.
[00:36:05] she has embodied these three things, more than anyone else. And so I basically just gave her, some kudos in front of our operations manager for doing those things, you know, and she's made plenty of mistakes along the way.
[00:36:18] but that's been okay because she has gotten faster. At her job. I can see every day that she is raising the standard for herself by trying to improve and not making the same mistakes twice. so I guess qualitatively it's just giving, a team member credit, in front of other team members.
[00:36:37] Yes. it's so good. it's like oxygen to team members when you can recognize the amazing work they're doing publicly. It's really powerful. I would say that's probably the thing that I do, I try to do, like if, I'll give you another example.
[00:36:48] We had a team member in the Philippines who identified, uh, area of our link building efforts that could be, It made more efficient through building software. he was teaching himself how to code. I didn't ask him to do this, but he built an internal tool for us to do link building with, and he presented it to his manager, our, director of, off page SEO
[00:37:10] And then they brought it to me and he showed it to me and I was like, this is amazing, like great work. Like this is actually working. Are you guys, have you guys tested this? And it wasn't quite ready for to be used across all of our clients. And then I asked him how many hours he had spent working on it, and he said yes.
[00:37:28] Made it probably took him like 30 hours. I said, cool, we'll add 40 hours to your next paycheck and you know, we'll make sure that you get paid for that time. it's not, just pat on the back. Good job. But it's like, Rewarding him financially for the work he had put in
[00:37:42] I know that meant a lot to him. That's beautiful. do you employ salespeople? I am still the salesperson. Have you ever thought about firing yourself? From the sales role? I mean, yes. Thought about it in the sense that, you know, could I, would it be a good idea for me to bring someone else in and teach them how to sell?
[00:38:02] No. In the sense that, I enjoy sales. So it's, it's not something that I, I enjoy sales in part 'cause I learned so much. In part because I just enjoy talking to people. and also because I enjoy refining our sales presentation. Every time I get in front of a new prospect, it's not with the same deck that I used the last time.
[00:38:23] There's constant tweaks and improvements to that sales deck that I get to use. but certainly have thought through, you know, at what point does the org chart include, one or two salespeople that, replace me. What would you say to someone who may say, well, that sounds like you're potentially bottlenecking the growth of the company, and maybe you are, maybe you're not, but that's totally fair.
[00:38:42] I've delegated enough of the other parts of the business that, holding onto the sales part up to this point has not been a bottleneck. I have a lot of urgency around sales. when we have a prospect come across my desk, I am able to move very fast to set up the intro meeting, set up the audit solutions plan meeting, which is essentially our proposal meeting.
[00:39:07] Do you sell, more of a productized service where you give a client like a menu of options or do you have more of a prescriptive, like, here's your scope and plan, this is the cost, or how do you approach like the productization of your services?
[00:39:20] Yeah, so internally, many of the things that we do are productized, but we're not selling it that way because we are working with companies that are a little bit larger and also like to feel larger. So trying to sell them something off the shelf, I think cheapens the service a little bit.
[00:39:43] I have found that part of our sales process is about half this is how we do things and why it's important that they're done this way. Like, this is some of the secret sauce that you get when you work with us and half an audit of their company, of their market, of their competitors.
[00:40:05] And it's a significant amount of education. everything from some of the more obvious things like doing a technical SEO audit of their website and, looking at their keyword rankings compared to some of their competitors, looking at the number of backlinks they have versus their competitors to show what the gap is, to something that I think is, much more non-obvious, but, equally, if not more important, which is to manually put myself in the shoes of the consumer in their area and look at.
[00:40:37] what am I seeing in terms of positioning, messaging, copywriting, color, on their website and in their marketing compared to everyone else they're up against? Because as a consumer, I'm not doing my research in a vacuum. I'm going to narrow down my search to, you know, probably a few pest control companies in the area based on what I'm quickly finding online, reviews, ratings, ads, level of professionalism that is being conveyed through the website.
[00:41:07] And that kind of process typically highlights very blatant issues, that the operator has just never put themselves in the shoes of the consumer before. But when you put their website and their marketing side by side with some of their other competitors, in particular, the bigger ones that have a lot of brand awareness and inherent trust, like Orkin and Terminix, they go, oh yeah, I can see why someone would choose these other guys over us.
[00:41:33] Like what we have going on does not represent us very well. so yeah, our proposal is a lot of, education, In addition to, it sounds very bespoke Probably requires a bit of effort on you and the team to prepare for those type of discussions. Yeah, it absolutely does. and it's one of the things that sets us apart though.
[00:41:51] And one of the things that our Prospects who end up becoming clients tell us, like, you guys actually did research. You guys actually took a look at our marketing, our website. It wasn't a canned, pitch deck type of thing. It wasn't a canned pitch deck. And, I've gotten my hands on proposals from a bunch of our competitors and I've seen how canned they are.
[00:42:10] And, frankly quite proud, when I was able to compare it to what we have going on and the level of the depth that we go, with our proposals, because it makes a huge difference, you know, clients or prospects really feel that. And we've, we've won, business that will result in, you know, seven figures of, lifetime value because of those proposals.
[00:42:31] What is your average deal size like as far as revenue goes? So, I, I always look at it as, as a RR, just because we, mm-hmm. another thing we do differently is we don't have clients sign a year long agreement. They sign an initial three month agreement, and then it rolls in month to month.
[00:42:47] which I find works really well for us. But, I think in terms of a RR, because I know the level of work that we provide, and I expect our clients to stick around with us on average for five years. we haven't been around long enough for me to really know how that plays out. but looking back, having run agencies, knowing how long a client sticks around, when we do really great work for them and they're the right fit for us, and equally as important, they stick around for a long time because finding a good marketing agency is really hard, you know?
[00:43:18] Yeah. Most clients who come to us, it's painful. They come to us frustrated, annoyed, skeptical. And so when they finally find us and they work with us and they get results and communication is strong and they're not locked into a contract, they. They just don't go anywhere else, you know? And they refer a lot of business to us.
[00:43:38] So our average, annual contract is, the way I look at it now is $72,000. And the goal is to increase that to a hundred thousand dollars over the next three years. Beautiful. I love that. let's shift the conversation to ai. the agency space is one of those that stands to be somewhat disrupted by ai.
[00:43:59] So even though what we advertise online is that we're an SEO and PPC agency for ambitious pest control operators, when I actually meet with a prospect, I shift that language to, so that I.
[00:44:20] They don't look at us as just an S-E-O-P-P-C agency. the term that I use is that we are a holistic search agency. Our goal is that when a prospect is looking for your services in your markets, they find you 3, 4, 5, 6 times, and I am agnostic to the platform that they use. yes, today the majority of our tactics and proven methods are optimized for, Google or Bing search.
[00:44:50] I don't care where someone is searching. I don't care if it's statute pt, if it's ai. Our goal as the partner to these clients is to figure out how to get them in front of prospects who are doing the search through chat gt. In fact, we've spent the last three weeks putting together our own research, manually, going to chat, gt logged in, logged out.
[00:45:14] and doing searches, long tail searches, shorter phrases in different markets with different clients to figure out which of our clients are performing well, which are not, what are the patterns emerging when it comes to, the pest control companies that are ranking well?
[00:45:28] And then putting all that together in a report, and then concluding what our strategies get to be moving forward. In fact, literally starting this week, I just gave my SEO manager the green light yesterday to start deploying some of the strategies that we think are going to work for our clients when it comes to these LLMs.
[00:45:45] so I'm excited about it because my experience, we tend to be ahead of the curve in our thinking about these things. and I think there's a massive alpha available to anyone who can, figure this out early. Because the shift to AI is very clear. I use chatt BT more than I use Google.
[00:46:04] Everyone I know uses Chatt more than Google. I think depending on, you know, what bubble you live in, that may or may not be true. but eventually everyone is going to come to that similar kind of, conclusion in their own experience. So I'm excited 'cause there's a famous F1 driver, Senna I don't know if you know who that is.
[00:46:22] He says, you can't overtake 15 cars, when it's sunny, but you can, when it's raining. And I think the introduction of AI and chat GPT in the agency world is a time when it feels like it's raining, which means it's an opportunity for you if you're. executing well to leapfrog, your competitors.
[00:46:43] And that is true for us both as an agency and also for our clients, who don't have an agency like us representing them and ensuring that they are, doing everything they can to be ahead of what's available with ai. I love it. That's the amp it up coming to life, right? the philosophy that approach.
[00:46:59] Beautiful. Yeah. what's your reaction to people like Zuckerberg saying that, all, meta ads will be fully automated by AI and, what does that mean for the future of agencies? I guess similar to what I just mentioned, I think my job, I don't think too much about the agency industry as a whole.
[00:47:20] I just look at what is, what is my job as a leader of, of this company. The problems that we're trying to solve, and what are the needs of, of my clients? So my job as the leader of the company is to steer us through and pivot when necessary,
[00:47:40] either way the shift is not happening overnight. there is time to adapt. So the need for leads is not going away. And it's not like the demand for pest control is going to, shrink. So I think it's just. Again, I'm excited. when he says something like that, I guess I don't give it too much weight.
[00:48:01] he's just saying what we've already experienced with even Google ads, right? when it comes to Google ads, I mean, nowadays we have Performance Max. You have all sorts of AI and automation tools. There a lot less control than we used to have, and that's not a bad thing. it just means we get to focus less on the tedious, annoying things that we really probably never enjoyed doing in the first place.
[00:48:25] Focus a lot more on strategy and differentiation and helping our clients position themselves to stand out, in an otherwise very commoditized, industry. So all this change is just, to me, exciting. I think it's super cool. It's super fun. the agency world may change, but, there's always gonna be problems to solve there.
[00:48:47] Yeah, yeah. So you've built, a great company. Premium positioning, great clients, great sales process. what's the future for Pesty? What's coming next? It's a great question. I mean, the future for Pesty, is doubling down on what's working and in operational excellence. we've grown very fast this year because of the good work we've done in years past.
[00:49:12] And also, of course, as you scale cracks appear in your processes and there's a lot of catching up and fixing to do when, when we've grown that quickly. pesti as a, as a company is going to continue providing the services we do as we adapt and also extending our service offering to, things like technology and CRM implementation.
[00:49:36] Problems that are ancillary to the problems we currently solve have risen. solving those problems, is an obvious next step for us and to provide value to our clients is in the future. But, I think for the next couple of years, it's likely just getting, continuing to put a gap between us and our competitors in terms of our capabilities and what we can do with the services we currently offer.
[00:50:00] because in our space as a service industry, search in whatever form that comes is by a magnitude of order, the most important marketing channel for our clients. our number one goal is just to be the best in the world at that and, to ensure that we're not being distracted by anything else that would get in the way of that.
[00:50:21] I believe in the vision. I believe in the mission, love our clients. This game is so fun. We have an amazing team. And also I am ready to move on from the agency world as a whole. I don't know what I'm doing next, but, currently in the process of recruiting CEOs, if anyone out there is listening is, is interested in, you know, joining this, this rocket ship and, more than happy to have a conversation with them about that.
[00:50:48] what would be some attributes you're looking for for a great CEO for this position? Culture fit is number one. You know, I've spoken a bit to the culture that I've tried to create at the agency, and I've leaned heavily into using language, like narrow the focus, pick up the pace, raise the standard, and yet we also do all of that while team members feel very supported and, very safe.
[00:51:14] So, hopefully it's not coming across like all we do is focus on, execution without the support side of things. I think the person I'm looking to hire has to have a very high sense of self-efficacy. you know, I'm looking for someone who has a, track record of success in winning.
[00:51:31] and when I speak to their references, they are glowing, like people just wish they had them on their team. Ideally looking for someone who has experience in leading a service business such as ours, leading an agency or having agency exit experience would be great. we have several candidates in the pipeline right now, one of which has founded and exited their own, agency.
[00:51:56] yeah, and someone who, someone who's ready to deeply learn about the pest control industry. I don't need them to be passionate about killing bugs, or pest control itself. I certainly wasn't when I started the agency. but someone who is highly ambitious, highly competitive, highly competent, who is, you know, ready to come in with, a team that is eager to be led, and who is going to kind of, I.
[00:52:25] Yeah, just, just ready to execute at a high level with, with the track record to, to vouch for that. Well, if, if folks who are listening that are interested and they wanna learn more and lean in on this, what's a good place for people to find you and, and get connected? Yeah, I think LinkedIn is, is probably the best place.
[00:52:40] if you look me up, I might be the first person who shows up. If you look up Andrew Peluso on Google, my LinkedIn profile but certainly if you look me up on, LinkedIn, you should find me. my job title would be like CEO of Bananas Marketing of Pesty Marketing.
[00:52:52] Awesome. I have, one last question for you as we wrap up. you've obviously, built, a great company. You've been on this agency journey for nine years, probably plus. And now as you mentioned, you're looking to bring in an A player, CEO. Looking at where you're at, what do you say is your motivation?
[00:53:14] So I have a philosophy that the only real laws or rules of this life are the laws of physics. Everything outside of that is human imagination. Every law, every rule, we think of every social, cultural constraint. It's all just stuff we made up as humans. And if you take that logic to the nth degree, then I think the conclusion you have to come to is that anything outside of the laws of physics is possible.
[00:53:48] And if anything outside of the laws of physics is possible, then you can accomplish whatever you want. And if that's true, then why not me? You have one life. Life is short. You might as well swing big. You might as well have a massive impact. You might as well have fun doing all of it.
[00:54:16] Like what do you really have to lose by taking a big swing, by believing in yourself, by trying to make the biggest, most positive impact you can possibly have in the world? We all have the same 24 hours in the day, but it depends on how you choose to use them.
[00:54:32] the words you choose, the people you enroll, the ambitions that you have, just go for it. You really have nothing to lose. Beautiful. Andrew, thank you so much for coming on the show, dropping all this great wisdom. I've learned a lot and I'm sure the audience has as well. So thank you.
[00:54:48] Yeah, thanks Corey. I had a lot of fun.
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