How Warren Buffett Inspired My Lifelong Journey Creating A $25M Cleaning Empire

$600,000
revenue/mo
1
Founders
500
Employees
product
Two Maids & A Mop
from Birmingham, AL
started April 2003
$600,000
revenue/mo
1
Founders
500
Employees
4.67M
alexa rank
396
followers

Hello! Who are you and what business did you start?

Hello dreamweavers, empire builders and world changers. My name is Ron Holt, CEO & Founder of Two Maids & A Mop.

I started my company more than sixteen years ago inside a 250 square foot office space. When I’m dead and gone, there’s a good chance my tombstone will read “Crazy Entrepreneur That Out Hustled Everyone”. That’s been my mantra ever since leaving the uninspiring halls of corporate America and it’s a virtue that is based on tiny, small habits eventually evolving into big, massive victories.

So if you’re like me, and can’t stay focused because you’re always wanting to fix another problem….just stop right now because the true secret to my success has been to simply outwork and outpassion everyone in my path, every single day for nearly twenty-five years now.

But for you more detailed types, let’s head back to April Fools’ Day 2003. That was my first day in business down in Pensacola. We cleaned two homes and received a whopping $110 on that fateful day. I lost money that day and would lose money every single day for the next two years. That should sound painful enough, but wait...there’s more. It took me another full year to finally earn my first paycheck. Three years of hard work, dedication and sacrifice that only a fool would want to entertain. I was a fool, making illogical decisions everyday in pursuit of a crazy goal of building my small business into an empire with locations all over this great country.

Today, we serve 82 markets across the country and generate more than $25M in annual revenues. The Two Maids & A Mop network employs more than 500 hard-working employees everyday and here’s an amazing and boastful stat:: my little cleaning business that only cleaned two homes on its first day cleaned nearly 400,000 homes last year! It’s been a crazy ride built on a ridiculous dream from a small-town country boy who believed his 250 square foot office space was just a temporary home that would one day grow into one of America’s most successful residential cleaning brands.

how-warren-buffett-inspired-a-lifelong-journey-creating-a-25m-cleaning-empire

What's your backstory and how did you come up with the idea?

I can still remember my first day on the job. I had just been hired as a Chemist for a particle analysis laboratory.

The job made a lot of sense at the time. I had recently graduated college with a Biology degree, and there’s only so many careers the degree can take you. So I took the first job offer that was presented to me and proudly bragged about my $22,500 annual salary. It seemed like so much money at the time, and I just knew that I was going to climb the corporate ladder quickly.

The true secret to my success has been to simply outwork and outpassion everyone in my path, every single day for nearly twenty-five years

On that first day, I sat in the corner of the lab and listened to my supervisor talk about the stock market. I didn’t understand the conversation at all. What was a P/E ratio? Why did these science nerds care so much about financial ratios anyway? I didn’t understand it, but I wasn’t about to be left in the cold when the subject was discussed again. So I left during lunch break and headed to the local bookstore inside the mall. Yeah, I know… I’m old.

I didn’t know where to start so I decided to just pick up a random book on investing. It was a book about a man named Warren Buffett. You may have heard of him, but he was a stranger to me. I read a few paragraphs and decided the book was purchase-worthy. I went home later that evening and started reading the book. And quite frankly, my life has never looked the same since that day.

I fell in love with Warren Buffett that night. I couldn’t believe what I was reading. This guy made it seem so easy. Live frugally, make smart financial decisions, own a business and dream big. It seemed so simple. I literally changed as a person that evening, and decided the rest of my life was going to be different. I was 22 years old and time seemed like it could be my friend.

I made a decision to start a business right then and there. Only one big issue: I had no money. So I created a completely random goal to save $150K before starting the business. I had less than $1K in my bank account at the time, and my $22,500 annual salary didn’t seem like much of a blessing any longer. I sat down and created a plan of attack to save money at all costs, take second jobs on the weekends/evenings, have side hustles to generate extra cash and to completely crush corporate America in hopes of promotions and pay raises.

My plan seemed so realistic, until one month later when my bank account still held less than $1K. I decided to use my inner science-nerd and create a step by step solution to the cash flow puzzle. I needed $150K, and wanted to open a business before I turned 30 years old. That’s eight years if you’re counting. I won’t bore you with the math, but my solution was to simply save $330 every single week for the next eight years. That’s nearly $140K if you’re counting at home. I felt my keen investing skills could get me over the finish line with a little help from compound interest.

So that’s what I did, every single week for the next seven years. Worked, saved, sacrificed my way to achieving that weekly goal of walking into the bank and dropping off $330. I hit the $150K mark when I was 28 years old, two years earlier than expected. And when that day happened, I left corporate America, moved to Florida and opened the very first Two Maids & A Mop. It felt so good, almost as good as when I walked back into that laboratory and started talking P/E ratios with the chemical engineers.

how-warren-buffett-inspired-a-lifelong-journey-creating-a-25m-cleaning-empire

Take us through the process of designing the business and your services.

My $150K plan was supposed to be a straightforward plan to just save money but it also created several positive, albeit unintended consequences..

I saved money by eating the same foods every day, yep...every single day. My odd nutritional plan allowed me to calculate the exact cost of living every week, which worked for me since my diet wasn’t necessarily adventurous anyways (yet another reason to love Warren Buffett). Remember, I was a young kid at the time and weekends were supposed to be fun.

But instead, I chose to stay home on a Saturday night rather than party with my fellow 20-something friends. I also worked my way up the corporate ladder by learning how to communicate with customers, vendors and co-workers. And I built side-businesses that forced me to learn how to sell a product or service. I may have never attended a single day of business school, but my life was the on-the-job version of business school.

During those seven years, I discovered so many things about myself. For one, I learned that my work ethic could generate large dividends for myself. I refused to believe anyone could out work me, and still embody this belief today. I never really cared about the science part of my job inside the lab and used this to my advantage since everyone else really, really cared about the chemistry.

As a result, I was promoted fairly quickly and was named the youngest laboratory manager in the history of the company. No one had ever managed the lab without a PhD, yet there I was...running day to day operations for the lab and supervising people so much smarter than me. It was around this time when I was first introduced to the concept of recurring revenue. We only had about 25 clients at the time. The clients would send in samples for testing on a weekly, sometimes daily basis. We never marketed to them, or anyone else for that matter because those 25 clients generated millions of dollars in both revenue and profits. It seemed like a genius business model and I fell in love with it. I wanted my own recurring revenue business, and that became my first clue to what would eventually lead me into the exciting world of residential cleaning.

Seven years passed and $150K was finally available for investment inside my personal savings account. I had the money, but did I have a business idea? During that time frame, I learned that recurring revenue was fantastic. Recurring revenue was powerful but it limited my investment choices to primarily the services industry. And since I was still a science nerd at heart, I decided to find a segment within the service industry that had yet to be disrupted. It was a difficult process because every industry seemed so mature. But one segment stood out like a sore thumb: consumer services. It was pretty obvious to me that even though people needed clean carpets, freshly painted walls and dirty toilets, no one actually wanted to perform those mundane tasks. So I zoned in on all things home service related and started getting more and more serious about the residential cleaning industry. Why? Mainly because other industries within the consumer services space appeared to be in a transition phase due to some type of external disruption. Once I realized the home cleaning industry was stagnant, I started researching it and discovered that only 3-4 national home cleaning brands served the industry. This did not seem like enough supply to meet the growing demand and none really seemed to stand out from one another either. So even though I’d never really ever cleaned my own home, I made a decision to enter the residential cleaning industry and open a house cleaning business in Pensacola, FL.

Why Pensacola? Well, why not? It had white sandy beaches, lots of sunshine and was just large enough for demand to be strong in my opinion. I figured people needed their homes to be cleaned anywhere, so why not build a business somewhere beautiful with a great quality of life. Of course, I’d discover later that building a business without any support does not allow much time to fish, golf or soak up the sun. But there I was...traveling south with my $150K and ready to take over the cleaning world.

Describe the process of launching the business.

It took me seven years to save $150K to open the first Two Maids & A Mop, and it took me just under two years to spend almost all of it. I was working six days a week, starting at 6 AM and ending around 11 PM. It was a grind to say the least. But no matter how much money I lost, my illogical brain told me to not worry. Unfortunately, I learned pretty quickly that enthusiasm and ambition can’t overcome a depleted bank account.

My worst moment came on a Friday evening. I had just made payroll by the skin of my teeth, and wasn’t sure how I was going to make it happen two weeks later. I sat inside a seafood restaurant all by myself. A seafood restaurant of all places?!?

I sat there inside the restaurant and started to cry. Seriously, like real tears. I was scared to death. Scared to let anyone know that I was failing, scared to admit that my dream was possibly a nightmare. As I sat there and cried, I made a decision to stop feeling sorry for myself and get back to work. I refused to entertain the idea of failure and raced back home to determine how to survive the next two weeks.

I can’t point to anything spectacular during those two weeks, but I can tell you that we’ve never lost money since that time. We’ve literally grown every month from that depressing night inside the seafood restaurant. I credit karma a little bit, but also credit my positive, can-do-anything attitude that surfaced after that silly evening inside a seafood restaurant.

Kharma was important, but I did make several important changes to the business model that truly saved my business’ life. For one, I focused on local marketing and tried to interact with anyone and everyone within the community. I scoured the local area for meetup and networking groups. I used my evenings and weekends to drop off door hangers on thousands of doors, all by myself. I connected with every real estate agent and provided them with a free cleaning, no strings attached. I even went so far as to offer a free house cleaning to anyone that would invite 10 of their closest friends over for an afternoon cocktail. Think of those afternoon cocktail sessions as the house cleaning version of a Tupperware party. I’d answer questions about cleaning, provide a bunch of free booze and everyone would be booking us by the end of the party. I was talking to anyone that would listen to me and using my people skills to my advantage.

Once we started taking off, I started to look to the future. Pensacola was always supposed to be an incubator, a test center that would allow for the national growth later on. We were finally making money, which allowed me to return all of my initial investment and consider opening another location. I chose a market only 30 miles away so that I could physically serve both markets if needed. I was back and forth multiple times throughout a day. It was intense, yet so much fun. I was doing it, finally growing, finally scaling this tiny business into a real brand.

The business wasn’t running itself, but both stores were growing and it was clear that my model could work in multiple markets. Now, could it survive without me? Short answer, no...which meant I needed to figure out a way for the next locations to run without me being so important. Enter Warren Buffett again.

Since launch, what has worked to attract and retain customers?

I was still obsessed with all things Buffett, and observed my fandom once a year by attending the annual shareholder conference in Omaha.

I was en route to the conference when Delta Airlines decided to delay my flight out of Atlanta. I was stuck, and bored, so I decided to buy a book. There were no new Buffett books to purchase, so I decided to purchase this purple book called Purple Cow by Seth Godin. The book changed my entire worldview in about 30 minutes. If you’ve never read it, the premise is pretty simple. If you were to observe a purple cow in a crowded pasture, you’d probably remember it since it’s pretty remarkable to see a purple cow. Simple concept, right? Well, it changed my life right then and there. I landed in Omaha and wanted to head back to Pensacola immediately. I needed my own purple cow.

It took me several weeks to brainstorm possible ideas. I had some real dumb ideas, but finally decided on a plan that allowed customer feedback to directly control our employee’s wages. Basically, a customer rates their level of satisfaction on a simple scale from 1-10, and we use that rating to determine the employee’s compensation level. It was a simple idea, but a scary one because I wasn’t sure if my employees would embrace it. There was some initial shock to the system within the two offices, but everyone became excited once the first paychecks were printed.

We started using the pay for performance plan as a sales tool. We talked about it every time someone called for a quote and always led with it during in-home estimates. People started to eat it up, and we quickly started to grow even faster than before.

Our phone lines were blowing up, customers were loving us and my employees were loving their fat paychecks. The plan aligned the interest of our employees with the my own interests as the owner. I saw an opportunity and decided to go all-in on the unique compensation plan by branding the company as a customer-controlled business.

There would never be another time in the future when we didn’t talk about the compensation plan. It would become part of us, no different than our own business name.

how-warren-buffett-inspired-a-lifelong-journey-creating-a-25m-cleaning-empire

How are you doing today and what does the future look like?

The pay for performance plan became our secret sauce. I was no longer the most important part of the business, and felt that it was time to test the model in markets beyond my local borders. We opened a store four hours away in Birmingham, AL. This was a completely different environment and demographic since my early stores were all located in coastal communities in Florida. It was going to be a true test, but if it worked...well, the sky was the limit.

Good news, it worked. We exploded out of the gate and experienced exponential growth during the first few months. I was giddy, and freaking out a little because I wanted to start opening more and more locations as fast as possible. After the Birmingham success, we opened a new store in Huntsville, AL...then another in Nashville, Atlanta, Montgomery, Charlotte, Knoxville, Chattanooga and Greensboro. It was finally happening, serious growth and scale. But like any good entrepreneur, the growth just wasn’t fast enough. We were using positive cash flow to finance the new stores and forced to open 1-2 new stores each year as a result. That was just too slow in my opinion. So I stopped all growth all together to determine a new path of even faster growth.

I knew the model worked. It made money, pretty fast in fact. So what channel would allow the model to continue its path but at an even faster rate? Franchising of course!

I did not know anything about the franchise industry. I was a lone wolf entrepreneur, so the idea of business support from an established network was foreign to me. I traveled the country observing other franchise systems. I attended industry conferences and read as much as possible about franchising. It took me more than one year to make it happen, but we finally opened our first franchised location in Tampa in late 2013. We didn’t sell another franchise until one year later. Wait, what?!? Franchising was supposed to allow for faster growth, not slower growth.

Turns out that franchisees love established business models with a history, but new franchise brands with no franchise experience, not so much. So we started converting each of our corporate stores into franchised units so that we could instantly have real experience supporting a franchise owner. That took about 15 months to unravel, but it changed our entire brand appeal because we suddenly had fourteen franchises rather than just two. After the conversions, we started growing very fast by opening eight stores in the next year. The next year we opened 28 new stores, then 26 new stores and opened another 24 just last year.

Our expectation is to open 20-25 new stores each year for the next ten years. We can do it, and will do it because the hard part is behind us. We know how to make money cleaning a home. We know how to train someone to make money and we truly enjoy the support function required by a franchisee. We have 82 business partners today that all want the same thing: a money making house cleaning machine.

how-warren-buffett-inspired-a-lifelong-journey-creating-a-25m-cleaning-empire

Through starting the business, have you learned anything particularly helpful or advantageous?

I’ve learned so much. I’ve learned that winners never quit. I’ve learned that small habits can create really big victories. I’ve learned that every one of my big victories were indirect results of my grand vision of building the largest, fastest growing, most innovative residential cleaning company in America. Passion is what separates me from everyone else, and I’m passionate because I believe. Nothing great has ever been built by someone lacking passion. So I created passion inside my head, inside my heart and refused to lose. Logic be damned. No one can ever beat us, yesterday, today or tomorrow.

That’s the true secret to my success, and every other successful person. They believe, which drives them to take action, which creates passion, which creates followers, which creates even more passion, which eventually changes the world. I’m convinced that anyone can change the world if they believe strongly enough in their mission. If you have a purpose, then others will find you and want to create success alongside you. Creating success is a religion and you better believe if you want others to believe. And man...do I ever believe!

What platform/tools do you use for your business?

I always knew that my end game was to build a national brand. But in those early days, I marketed my business like every other cleaning business. Direct mail, door hangers, postcards, flyers, even yellow page ads (I told you that I was old). Eventually, it dawned on me that for me to beat the big guys, I had to either outspend them or do something different. Obviously, I couldn’t outspend them so I decided to do something different. I invested heavily on digital marketing channels such as Google Ads and Yelp. This was a novel concept back in the early days and remains fairly novel today since so many cleaning businesses understand the digital marketing landscape.

I then became obsessed with all things SEO. The idea of earning a website visitor without having to pay for it seemed attractive. We compete in an old-school industry, so I was able to master the art of local SEO without having to earn a master’s degree. SEO was driving so much traffic to the consumer sites, and we’ve used those early days to truly master the art of SEO today. We perform SEO work for all of our franchisees, at no cost to them.

Social media marketing started to grow in popularity and I decided to leverage it since I felt my competitors would be slow to evolve like in the past. How to find the perfect demographic, how to deliver the right message at the right time, how much to spend on a click... I became obsessed with anything and everything social. And it worked because we were the only cleaning company providing relevant content to potential customers. I’m not sure we’d be here today without the power of our branding initiatives within different social media channels.

Today, we execute the entire digital marketing strategy for our franchisees and don’t even consider offline marketing tools. The focus became such an asset for our business that we invested even more resources and developed our own internal software development department. We have multiple in-house software engineers today and have created an all-inclusive scheduling software that allows for a user to experience the product as a consumer, employee or franchisee. It’s an amazing product that acts like part CRM, part schedule, part payment processing and part business analytics.

how-warren-buffett-inspired-a-lifelong-journey-creating-a-25m-cleaning-empire

What have been the most influential books, podcasts, or other resources?

Purple Cow by Seth Godin

This book changed my worldview on business. To grow, you need to be different...plain and simple. Go read this book right now and start looking inward to determine your own purple cow.

Being purple is the only way to be first-to market in today’s hyper-competitive marketplace. Not by actually showing up first, but by redefining an industry with a tangible difference maker.

Making of an American Capitalist by Roger Lowenstein

I got lucky by picking this book up during my lunch hour. It changed my life, and still serves as my anchor today.

Warren Buffett should be your hero too...not because he’s wealthy but because he’s used his time on Earth to do what he does best...allocate capital and build profitable companies.You can do it too, but it’ll take decades of patience and hard work, along with some compounded interest.

Buffett may be 87, but his wisdom works for teenagers, millenials and baby boomers.

Traction by Gino Wickman

How to build a business that works. If you’re a startup, then read this book because it’ll force you to look inward for solutions. Step by step plan on how to scale a startup. Bonus tip inside the book, how to never waste another minute inside a stupid meeting.

Advice for other entrepreneurs who want to get started or are just starting out?

Start with a vision. My vision is to build the largest, fastest growing, most innovative residential cleaning company in America.That makes more sense today than sixteen years ago. But here’s the thing: I believed it way back then just as much as today. You’re the leader and everyone around you needs you to create the roadmap. So dream big and create a vision that is illogical, unrealistic, just plain crazy. It’s ok to think big and it’s ok if no one else believes your dream is possible. It starts with you, and only you.

Don’t waste another minute. Go grab a pen and paper right now. Start thinking about what you want out of life, out of your business. Then document it, and start chasing the dream. You have to know where you’re going if you want to know if you’re headed in the right direction. Stop believing that you can out work someone and good things will happen. Working hard is important, crucial in fact. But I learned a long time ago that hard work by itself accomplishes very little. When you know where you’re going, then you work hard because you have a purpose. Go find your purpose, and then others will follow as long as you bring a level of passion to the workplace every day, every minute, every second. Anything less will result in failure, I guarantee it.

Are you looking to hire for certain positions right now?

We have 300 markets available for franchise development. We want hard-chargers. Hustlers that want to make a bunch of money while creating purpose within their own small business. We can teach you everything you need to know about a cleaning business.

We can’t teach heart, grittiness or drive however. If you have those qualities and need help figuring out the business model, then maybe you should do what I did more than sixteen years ago and start a residential cleaning business. Two Maids & A Mop changed my life, and I think it can change yours too.

Where can we go to learn more?

If you have any questions or comments, drop a comment below!

how-warren-buffett-inspired-a-lifelong-journey-creating-a-25m-cleaning-empire

-  
Ron Holt,   Founder of Two Maids & A Mop

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