Building a Construction Empire: Ryan Pudenz’s Strategic Acquisition Playbook | Venture Capital Series

Anthony Codispoti : Welcome to another edition of the Inspired Stories podcast where leaders share their experiences so we can learn from their successes and be inspired by how they’ve overcome adversity. My name is Anthony Codispoti and today’s guest is Ryan Pudenz, founder and managing partner at Merit Management Group. They specialize in acquiring small to mid-sized construction businesses, focusing on enhancing legacies, empowering futures, and ensuring smooth transitions for owners. They have a proven track record in revitalizing operations and improving profitability, demonstrating their commitment to strengthening the construction industry. Ryan has been instrumental in shaping Merit Management’s strategic direction, drawing on over 20 years of experience, including a role as a sales trainer at Service Corporation International. His background in sales and training has helped him become an effective leader who understands both the people and process sides of business growth. Now before we get into all that good stuff, today’s episode is brought to you by my company, Add Back Benefits Agency, where we offer very specific and unique employee benefits that are both great for your team and fiscally optimized for your bottom line. One recent client was able to add over $900 per employee per year in extra cash flow by implementing one of our innovative programs. Results vary for each company and some organizations may not be eligible.

To find out if your company qualifies, contact us today at addbackbenefits.com. Alright, back to our guest today, the founder and managing partner of Merit Management Group, Ryan. I appreciate you making the time to share your story today.

Ryan Pudenz : Yeah, great to be on and appreciate you having me.

Anthony Codispoti : So Ryan, I’d like to talk a little bit about some of your work history before founding Merit. And as I understand, after college, there was just one stop. Service Corp International, tell us about that and why you stayed there so long.

Ryan Pudenz : Yeah, so a quick funny story. I actually, I was at the University of Northern Iowa and thought I wanted to get into sales and had accepted a position with a office solutions company, you know, selling copy machines and that type of thing, printers, and moved to Ames, Iowa to move in with my fiance at the time, my now wife, and found out they called me and shared with me that they put a hiring freeze on. And so I went from having employment to not having employment and ran into a guy that worked for Service Corporation International, started talking to him. And next thing I knew, I flew out to St. Louis, Missouri and interviewed and a month later was hired and 18 years later and five stops later, I was still working for SCI and fortunately had made it back to Iowa.

Once we had had our first child and got to be by family and it was a great ride. I’ve really enjoyed it. I stuck there because they had a great culture. They took good care of me.

Obviously, I put in the work and and prove myself. I we started in St. Louis and then we were moved to Phoenix and then to Las Vegas, then to Dallas, then to Houston. And eventually they allowed me to come back to Iowa and set up shop here. And so really enjoyed my time there.

I learned a lot about business management, learned a lot about sales, learned a lot about employees and people and how to handle them and have been able to use that now in my my current endeavors.

Anthony Codispoti : So what does Service Corporation International do?

Ryan Pudenz : Yeah, they’re the largest owner and operator of funeral homes and cemeteries in the world. And so when I first started with SCI for short, they were acquiring other consolidators. So there was really a group of three to four companies and eventually SCI bought those companies and then transition more into strategic acquisitions based off of market share footprint and started to buy some of your mom and pop funeral homes and put them into their portfolio and and manage them the way they run their other locations. And so that’s why I moved around is they would acquire. I would get moved and help get things set up, get leadership in place and and deliver to targets.

Anthony Codispoti : So not it doesn’t sound like so much of a sales role then.

Ryan Pudenz : No, it was, you know, I focused on our sales growth. But with that, it encompassed all aspects of the business. I worked hand in hand with the operational leader. And so very involved on both operations and sales.

There was a lot of crossover there from both parties. And so really got exposed to just business in general, even though my title had sales in it. But really, it was it was help managing the business and grow the businesses that were in our area.

Anthony Codispoti : Gotcha. OK, so from service corporation international to, you know, managing funeral homes across the country, how did the idea for starting merit management group come about?

Ryan Pudenz : So my wife is an interior designer. She has her own interior design business. And when we moved back to Iowa, obviously that opened up a whole another book of business for her because she had been doing this from afar and has a big network back here in Iowa.

And so started to get calls. And then, you know, the question from the potential clients was, do you know a good contractor to use? And if I think one day I said to her, we’re foolish to keep passing business along, you know, we could get the design plus do the work. And so we stumbled across a local remodel company here in Des Moines that was looking to sell.

My wife and I bought that and ran that operation and really got it going. And fortunately for her, she didn’t have to do a lot of design. They had designers and kind of were self-sufficient, but was another resource for her and her business. And, you know, what I started to recognize was very similar to the funeral industry, skilled trades. There’s a lot of baby boomers, you know, that silver tsunami is there.

And, you know, a lot of these folks are really great skilled trades individuals. And that’s how they started. And then demand picked up and they turned themselves into a business and, you know, really didn’t have an exit plan. And so I saw an opportunity for something that I believe can’t be replaced by AI that, you know, housing markets never going to get caught up. There will be ebbs and flows, but we’re always running at a deficit there. And, you know, from a labor force, you don’t have all the labor that’s needed. And so demand is there. It’s being able to supply the services. And so when I wanted to get away from the corporate world, started to formulate the merit idea and put into place our team, our infrastructure and target skilled trade businesses and, you know, large private equity has done similar.

I think we separate ourselves because we still have that small family feel and we’d like to keep that. And so, you know, owners that have spent 30, 40 years building this business can gain the confidence known we’re going to come in and not change everything day one. What our goal is is to take, you know, a successful business and get it thriving and be able to inject resources that they haven’t had previously.

Anthony Codispoti : So tell me a little bit more about the portfolio you’re talking about, you know, home services, trades. What are we looking at specifically?

Ryan Pudenz : So we have two HVAC companies. We have another HVAC company that we’re currently under LOI for. And then we have three remodeled companies. We have a flooring retailer. And then we have a power equipment supplier as well as a cabinet manufacturing manufacturing business. So really target within those businesses, both residential and commercial. So we do work on residential new construction. We do work on residential remodel. And then we do work on commercial new construction and commercial tenant improvements or remodeling on the commercial side as well.

Anthony Codispoti : Is this all close to you geographically in the state of Iowa?

Ryan Pudenz : Yeah, we’re all in the Midwest. We have location in Minneapolis and then in the Des Moines metro area. OK.

Anthony Codispoti : Are there plans to expand to other geographies or to kind of broaden the scope of sort of these home services? Or do you kind of like the spots that you’re playing in now?

Ryan Pudenz : Yeah, we like the Midwest. We like kind of that middle sized market. I think we’ll continue to stay in what we would call a middle market with middle sized, medium sized businesses. But we want to expand our footprint and we want to get across the Midwest.

We’ve looked at a couple businesses in the South as well. We’re not opposed to that. But I think it comes down to more as we start to meet owners and look at opportunities, it comes down to a fit in our ability to see where we can enhance that business as well as supply the resources necessary to it to help it continue to grow. And right now the Midwest, we feel like we know really well, but we’re not opposed to expand and pass that.

Anthony Codispoti : And so what is it that you’re looking for specifically in an acquisition? Is it the owner is staying on as an operator for a period of time? Is it a certain size?

Ryan Pudenz : When we look at a business, what we’re really looking at upfront is brand and reputation. So our average portfolio company is 32 years old. And what I tell people is I can’t, I don’t have 32 years to build a brand, but hopefully we can acquire one and make it even better. So the first thing we’re looking at is what is brand reputation?

What is their overall reputation throughout the market that they serve? And then from there, we look at customer concentration. And if it makes sense to where the business has been spread out over multiple accounts, we’ll continue to pursue that. We do come across acquisitions where the owner started it and he’s the point of contact. And so if we run a risk, if we were to acquire that owner’s not there, what’s the tie to that business? So we make sure there’s a good brand.

We make sure that it’s a reputable company. And then the next is what’s the split of business? And how can we supplement that business with the businesses that we already own?

Whether that be the company we’re buying can buy from one of our other companies at a lower cost? Great. That’s a big advantage for us. If it’s we’re in the same market and now we can share accounts and one offers one service and the other offers the other, we know or can go into an acquisition with some pretty good confidence that we’re able to grow that revenue just simply by tying some of our accounts together. So we look at that from an owner standpoint. We love it when an owner stays on if it’s a fit. And normally we don’t close on business if we’re not a good fit for the owner and vice versa. So we like when owners stay on, we generally don’t have them in a leadership role. We have them more, what did you enjoy doing when you were owning the company?

And a lot of them, I like to go on out talking to the accounts. Great. They’re great ambassadors for us. We leverage that. And then we take the real fun stuff of payroll, payables, and people off their plates. So they get to just go have some fun and keep promoting the brand and help us continue to grow.

Anthony Codispoti : I mean, you’re describing the dream of so many founders. Take all that administrative stuff off my plate so I can focus on the work I love doing.

Ryan Pudenz : That’s right. Yeah. And you know, it’s interesting, Anthony, when we go to talk to an owner and, you know, start talking about the acquisition side of things. And I always ask them, what would you do to grow the business?

And what’s interesting is they’ll all tell you exactly what they would do to grow the business. And my next question is, well, why don’t you do it? And it’s, I’m tired.

I don’t want to. I’m comfortable where we’re at. We’ve done a good job and it took a lot to get to this point. And so, you know, we kind of build off that conversation. It’s like, well, let us do that.

And you go do the fun stuff and help keep us relevant in the community. People know your face. They know your name. It’s your name still on the business. And, you know, we’re happy to do that and set up an agreement to do so.

Anthony Codispoti : So, when you’re coming into a new opportunity, are you traditionally buying the entire company 100% and are you taking over sort of operational control then? Yes.

Ryan Pudenz : So we do 100% acquisition and then we run as the operator. We’re a little unique in that at the merit level, what we really are is a support arm. So we have a CFO with a accounting department. We have head of marketing with a marketing department. We have HR. We have new business development. We have directors of operations and then we have recruiting. And so we’re able to acquire a company and bring them into our ecosystem. And now they get access to all these services that in some cases they didn’t have previously.

Or it was a limited exposure to them. And now our group comes in, we help with local management. Generally speaking, when we acquire business, there is an employee there that gets promoted into a leadership role.

Our director of operations, they work directly with that leader and help them understand what we look at from a business perspective and then start to build out their business plan and how they can use the resources here at Merit that we have to help them speed up that process and become even more successful. We’re very hands-on on the operation and sales aspect of every company that we acquire.

Anthony Codispoti : Can you maybe point to a specific example of something recently where you guys have come in and really helped to pull an operational lever that’s helped to advance the company?

Ryan Pudenz : Yeah, so one of our recent acquisitions mid to end of last year, when we acquired it, the marketing end of what they had done was very limited. And from a cost perspective, just simply leaning on vendors hadn’t really been a conversation. Well, we were fortunate, we have another business in the same skilled trade and we’re able to go to our vendors, create savings right off the top on our goods. We were able to create savings from a spend that they had done on an administrative side because now it’s a fractional spend. They get the full service, but our employees are divided over eight different companies versus just one. And so we use a combination of our own debt and equity and then we bring in investor dollars and one of ways that we can help a company perform better and we can give better returns to our investors is because we are able to fractionalize costs to these businesses.

We are able to leverage some scale and create savings from a good side of things and then we’re able to push the revenue lever with our marketing and our sales background.

Anthony Codispoti : What’s your holding strategy? How long do you want to hold the companies? Is there a roll up coming? How do you guys think about this sort of long term?

Ryan Pudenz : Yeah, so we model everything on a five-year hold and our approach is that that five-year hold, first and foremost, what we’d prefer to do is do a recapitalization and buy out our investors so that way we’re 100% owners. There could be an opportunity because we run everything on syndicated fund structure to be able to roll all of our syndicated funds into one big fund. But you our hope is to hold for the long term but for the short term for the investor and be able to then have 100% ownership.

Anthony Codispoti : You want to help your investors cash out within a five-year time period. Your goal beyond that is merit to hold on to these for the long term. That’s correct. What are you looking for in an investor?

Ryan Pudenz : So we do require accredited investors but really what we look for an investor is someone that understands our thesis, our story. We’ve been very fortunate. We really only target retail investors at this point and when we sit down and tell our story, they’re able to see the vision and also understand the need. So our first set of investors have now kind of introduced us to our second set and second into third. Work travels and people have been pleased with our performance but really it’s someone that is invested in their 401k. They’re invested in the stock market but are looking at what are some alternative investments I can make. Real estate is always nice but it’s real estate.

It is what it is. These businesses create extreme upside in my opinion because of the EBITDA that we buy it at and what we believe we can grow it to and then exit at a price that’s very beneficial to the investor.

Anthony Codispoti : What have you found have been sort of the biggest growth levers for you once you acquire a company?

Ryan Pudenz : Yeah, so you can only save your way to a certain profit at some point you run out of savings to get but we’re able to create savings right off the bat but really our growth lever comes with our marketing department and our sales approach. I think sometimes when you have legacy companies you get tired eyes looking at the approach and so we bring in a different spin on how we think we should market and how we think we can grow sales and then bring in fresh sales folks that can help do that. I think that’s the biggest lever for our growth is of course up front we’re going to create some savings whether that be on goods or from our resources here but the real lever comes when our marketing department gets instilled and we start to get in through our sales approach and training.

Anthony Codispoti : So I’m going to guess and tell me if I’m right or wrong here that that marketing involves a lot of online marketing you know getting to the top of Google showing up on you know somebody’s mobile phone when they’re searching when they want that service and then sales there’s probably a particular technique or strategy that you’re teaching to each of your portfolio companies. Hey we have found that X, Y and Z sort of taking these steps is really helpful.

Ryan Pudenz : Yeah so from from the marketing side of things you know we we have two individuals that are in charge of social media and making sure that we’re relevant and present on social media. We have a content creator and website developer so we always refresh websites if a logo needs refresh we’ll do that as well and then we have a gentleman that that goes out and does live shoots on all of our projects you know our type of work people have to see it and it’s got to speak to them and so we’re constantly refreshing content on live work that’s going on and completed projects and that helps us out. From the sales side of thing really you know my background being focused on sales where I think I guess you could say we set ourselves apart but I don’t think it’s a novel concept on anything but in sales it’s pretty straightforward the person that follows up the most generally wins and so everything we preach is speed delete. If someone calls in we need to get in front of them and we need to make sure we’re following back to get a decision with them and you know you earn that right by going out talking to them understand their problem diagnose in a solution and then you know building a report to where they feel as though you’ve got my best interest I think you’re a reputable company this is the people I want to do business with but so many times in all sales but especially in skilled trade sales it’s if I don’t get the yes right there then I move on to the next one and you know we we hear it all the time someone came out to look at my project and I never heard from them again and we don’t want to be that group and so we’re constantly preaching just follow up follow up follow up and that’s all based off of your ability to to build rapport and value and what we have to offer on that initial meeting.

Anthony Codispoti : You probably got some tech in place some CRMs and whatnot and some automated follow-up sequences or at least ding the the sales rep to tell them that they need to make that call again yeah.

Ryan Pudenz : Yeah and that becomes a little bit of a challenge from a merit level because every every company has their own CRM and and lead management system and point of sale system and really it has to be that way because they’re so specialized and so it’s hard to find one program that encompasses you know cabinet manufacturing along with HVAC install just it’s hard to find and so each one has their own system and and then what we’re able to do is generate rolled up reports by getting them together and Tim and our accounting department does a good job in marketing from a CRM standpoint of that.

Anthony Codispoti : So you’re able to allow each of the acquired entities to maintain sort of that CRM structure that they’ve gotten placed because like you said this the tool that they’re using is so specialized for their industry it has the different feature sets that they need so what you have to do is come in figure out okay how can we get the data out of there to make sense from a reporting perspective and let us know that we’re hitting our metrics and if we’re not let us know kind of where that coaching needs to take place.

Ryan Pudenz : Yep exactly and so from a financial perspective some of these systems that we have drive our financial statements so that becomes another challenge is to do exactly what you just said to be able to harvest that data roll it up and make sure that we have accurate reporting. The advantage though if there if you wanted to point out the biggest advantage of everyone having their own CRM is we’re able to extract those leads we keep them at the business obviously but extract them and load them into our merit database and what that allows our marketing team to do is take the leads from our HVAC company and now be able to market to them for a cabinetry and flooring and remodeling services as well and vice versa our remodeling company is now going to the pool of merit leads and they might get marketed for HVAC installation and furnace insulation whatever that may be and so we’re able to now these businesses that were kind of on their own island make them a part of a bigger group and their lead pool now becomes a part of a bigger group and allows us to offer you know more programs to more customers between all of our companies combined.

Anthony Codispoti : I’d like to hear a little bit more Ryan about what you’ve learned from due diligence you know when you go in and you’re thinking about acquiring a company you’re doing research on them you’re looking at their financials you know you’re taking a look under the hood like what’s the state of this company I want to know what I’m getting into and if this seems like a healthy company or not and that can be a difficult process anybody who’s ever been through it you know it’s hard to spot all the the works and wrinkles from whatever is being presented to you is there anything in particular that you’ve kind of learned through experience in the process where you’re like oh here’s something that we do now that we didn’t know to do when we first started

Ryan Pudenz : yeah I think the biggest thing that we’ve I guess conditioned or trained ourselves to do is to remain disciplined in the sense that if we see a red flag generally speaking there’s a red flag and so you know if you’re getting surface level answers on something that you think doesn’t look right the chances are they’re trying to hide something and so we continue to dig and you know we try to safeguard ourselves with that we we do a pretty in-depth due diligence here at our merit office but we also hire externally another company that will do the same so that way we can cross compare and compare notes and make sure we’re not missing something in vice versa and so we’ve learned again that if something doesn’t look right it’s probably not right unless there is a clear explanation from the beginning but more more times than not that explanation is very surface level and probably tells you everything you need to know

Anthony Codispoti : I think that’s a great reminder I mean anybody who’s ever gone into a deal you get excited about it right I mean you’re yeah this is what this is fun like let’s grow the business that we see opportunities here and sometimes you see these flags and you try to explain them away or it’s not a big deal or you know even if it is true we can still work around that and so it’s great to hear you know from your experience somebody’s been through this multiple times you’re like now it looks like a flag it’s probably a flag time to step away I think

Ryan Pudenz : I think human nature also is it might be a flag but I can fix it and I think you have to keep the approach of assume you can’t fix anything read the business as though it’s going to continue as it is and if there’s a red flag there that you know pretty much if again if you aren’t getting the answer that you know you probably need to get which is some details behind it that’s going to tell you what you need to know

Anthony Codispoti : now Ryan if you had to recommend one resource to our listeners a book a course a podcast that’s been really helpful for you what would it be

Ryan Pudenz : who let me think here you know my mind’s a little hard because I think my greatest resource was my corporate life I got exposed to so many different businesses in across the country and multiple former owners and leaders that approach things differently and so you know I I really let I lend myself back to that training as what as I’m working here at Merritt is what I learned from my time with SCI that really helped me gain a business knowledge and be able to you know look at business what am I looking for and what do I think is possible with them and so you know that’s not the answer to your question that you’re looking for but that really is my number one resource was you know the people that helped me the most right the people that I was paired with and really asked questions and and you know I wasn’t afraid to say I don’t know the answer so train me and teach me and still try to keep that today but you know that’s that was my learning ground was my 18 years of being able to to see live day to day real scenarios and to be able to inquire and learn and listen and and remember and and act on what you know what I was told would be the best approach and there’s a lot of trial and trial and error in that.

Anthony Codispoti : Well I think there’s a ton of value in what you just shared there for our listeners Ryan because sometimes we get sort of distracted with oh what’s the the cool new book everybody’s talking about or the podcast du jour where I’m gonna you know level up my game and you know hearing your story it’s like and I learned from a lot of great folks that I worked with like I was just super involved in my job and asking questions and not afraid to admit when I didn’t know something and actively asking for help acting asking for help asking to be trained on that thing and man what a great way to learn I can think of no better way myself to learn than on the job like it’s one thing to learn theory from a book or to hear somebody else in a podcast talk about the way that they would approach something it’s great to get those new ideas but man hands on you know roll up your sleeve get your fingernails dirty get right in there and learn I mean I think those are that’s the best way period

Ryan Pudenz : and I think there’s a lot of people even today you know because I’m still new to merit and you know I think I have a good business knowledge but always learning I still run into people today that you know I meet them they’ve been very successful in their line of work and and they offer you know if I can ever help you I’m happy to do so and I think sometimes when you’re getting going or you know starting to learn what it is you want to pursue you feel as though those people are too busy to talk with you and it’s amazing how many people out there will actually spend the time with you and and want you to be successful even if you’re a competitor they’re willing to share what’s helped them and I think sometimes we just we assume they won’t do that and and I would encourage people reach out to professionals in the in the line of work you’re looking for and you’d be amazed how many people will spend some time with you and share some pretty good secrets that’ll save you a lot of time of making your own mistakes

Anthony Codispoti : now that’s a golden nugget right there you don’t know if you don’t ask don’t assume that even if you guys are you know traditional competitors that you know there isn’t a bond to be formed there I like that right I want to shift yours a bit and would love to hear about a serious challenge that you’ve overcome whether it’s personal or professional how’d you get through it what did you learn coming through the other side

Ryan Pudenz : yeah so I you know I kind of hinted on it earlier with my challenge of thinking I had my first career set up you know coming out of college and getting a three-day notice that I no longer had that job and I tell you what when you’re young and you’re excited to get out of college and get into the workforce that that’s somewhat of an ego boost now all sudden I’m starting all over and have to find something and figure out what I’m gonna do and then you know I would say that challenge grew once I got hired by Service Corporation International you’re in the funeral and cemetery business and I never saw myself being in funeral and cemetery business and the challenge was I needed to learn it and learn it to the best of my ability I had resources around me and training around me but really at the end of the day that type of business is getting in skinning your knees and figuring it out and so that was a big challenge and and I will say there were times where you question is this what I’m really supposed to be doing is this worth it and you know in the end here we are 19 years later and I had a great career in the corporate world and now I feel as though I’ve started you know to form a really nice company and can have a great second career but really that challenge of just second guess in what you’re doing and you know am I cut out for this and you hear it all the time people quit right before they see the reward and I kept telling myself that and I was able to see some rewards and you know there’s days now starting my own company where you question is it worth the grind and you just got to trust it is it’s just continuing to fight through those challenges and really taking care of what’s in between your ears and and what you’re saying to yourself.

Anthony Codispoti : Let’s say a little bit more about that you said something interesting there you kind of asking yourself the question is this what I’m supposed to be doing and I’m curious from your perspective was that kind of more of like a existential like is this my like the purpose of what I’m here on earth or man this is just too freaking hard maybe there’s like an easier path out there.

Ryan Pudenz : Yeah I think mine was you know I felt as though I wanted to be in business and in business management and then you know really like the sales avenue and there were times where at starting out you know you feel as though you’re just always playing catch up I don’t know what I don’t know and so then I started to question is business and being a business leader really what I’m made out to be and then shift to the sales side am I really cut out to hear no more than I hear yes and you know it’s hard to get from somebody in pitch and let alone pitch by your cemetery space from me and so you know those were the questions that I had and went through my head was am I equipped to be a leader which is what I’ve always envisioned myself as and am I willing to put in that work because you know I always felt like I was playing catch up to get up to the people that were in those roles just from an experience standpoint and then what you tend to find out is experiences and everything right it’s your ability to to handle difficult situations to handle yourself through that and you know that’s leadership because now the people that see how you handle it realize that you know what that’s the right person to be in front of a group and show them how we handle adversity and how we handle success and how we can continue to grow employees that that have the desire to grow and be successful because they want to emulate the leader that they’re ahead of and you know there were plenty of times before I got to that that I just question if I was cut out for that

Anthony Codispoti : how do you work through that I mean talked about taking care of that gray matter between your ears that doubt that you’re talking about that questioning of your own abilities especially when you’re getting a lot more nose than yeses that’s common but how did you figure out to pull through that what’s been a helpful tool or process for you keep going

Ryan Pudenz : I mean eventually if you get enough of bath at baths you’re gonna get a hit right and once you get a hit you get confidence and once confidence grows the hits come more often and what I kept telling myself was I just got to keep going I just have to go back to it and if I’m not cut out for it what I don’t want to do is tell myself I’m not you know you start to question that they have to make that decision at the end of the day and and they being my employer and so you know now owning my own company same thing it’s like every day you just got to go back to it and you got to keep pushing forward because there’s no sense in going back and there’s no sense in stopping and when it’s time to stop the stop sign will hit you right you’ll be done but for right now just keep going and I think you know that’s how I got through that was just continuing to tell myself learn but keep stepping forward and and trust that you know eventually it’ll click and and it did the light bulb went off and you go okay now I got this

Anthony Codispoti : yeah one foot in front of the other is what I’m hearing you say and I heard it from a lot of entrepreneurs or a lot of C-suite level folks that it can be really hard and it’s a hardness that people from the outside don’t see and so hearing you give voice to it and like I don’t know I just I get up and I take another swing I put my foot in front of the other foot and I just keep going I mean that’s the recipe right and like you said at some point if you’re supposed to stop you’ll know that stop sign hits you in the face but just because it gets slow and hard that’s not the time that’s that’s the time to double down behind every great business is a great team my experience right not in your head like you agree what’s been your strategy for attracting and then retaining good folks

Ryan Pudenz : yeah I think a lot of times my experience has been people look for experience within the field that they currently oversee and I didn’t always find that to be the best approach what I looked for to build a team was attitude and effort and I believed I could teach them the role as needed to be teach now granted there are some people that it requires some background I’m not saying that in some positions but I think at the end of the day the more you can do to really test someone’s ability to handle you know what what is your attitude just as you asked me when something goes wrong what’s your attitude when something goes right you know attitude and effort to me go a long way and and help it a company be successful on a team to build a culture because it’s contagious and and next thing you know you have a team full of doers and you know our patting each other on the back and celebrating wins and successes in lifting people up in each other up when things aren’t going well and you need that and so in order to build a successful team that’s been my experiences I try to find out how can I figure out what their attitude is on a daily basis and most people will show you two minutes into your interview and you know how do you judge what effort can get out of them and that’s to me based off background what have they done previously how did they work themselves through it how did they work themselves to be successful keep that job you know get promoted whatever that may be and those answers will tell you a lot towards the effort that they’re willing to put in

Anthony Codispoti : that was going to be my question is how do you ascertain that in an interview and so you like asking questions about something that they had to work through in a previous job you know give me that example and kind of talk me through the steps that you took is that right

Ryan Pudenz : yeah and I think on the attitude side you’ll find out a lot just asking you know as you think of the places you’ve worked with what was your favorite culture environment that you worked in and why and a lot of times they will tell you I worked at X and it was my favorite because you know what we celebrated we had a good time we worked hard but everybody just really got along and made things happen well they were a part of that as well and so you know generally speaking they get along because they’re they’re positive individuals that have great attitudes that are looking to celebrate success and help with people when the success isn’t there and so that can tell you a lot right there

Anthony Codispoti : right do you have any particular daily habits or rituals that you go through either something to help you start your day or to keep you centered throughout the day

Ryan Pudenz : yeah so I’m fortunate I have a home gym and so I usually get up about four in the morning I try to have a cup of coffee before my I have a six four and two year old before they get going so I like that morning routine of quietness it’s dark still so I get some time to just think to myself and then I try to get in a 45 minute to an hour workout and get all that done before anybody else in the house is up and go on and really to me that’s my time to have to myself to think through you know what it is that I did the previous day that helped me be successful and what I need to do today to make today’s success and so that’s really my my number one I guess go to is making sure that I have that time to myself and then I get a workout in and I try to push myself in a workout because if I can do that before 7 a.m. 6 30 a.m. you know and get one of the hardest parts of my day out of the way I know I’m set up for success the rest of the day

Anthony Codispoti : so if you’re up at 4 a.m. what time does that mean you’re hitting the sack

Ryan Pudenz : my wife and my friends will tell you I am that guy 8 30 I’m in bed and if I see 9 o’clock it’s a late night for me so I’m very fortunate and the I can fall asleep like that so I lay down and and I you know I’m shot at the end of the day I like I said between dealing with employees all good you know never bad and then going home and chasing three boys around and when I put them down I’m ready to go it’s time to sleep

Anthony Codispoti : what’s something fun that you do outside of work Ryan

Ryan Pudenz : spend a lot of time with my family I coach my boys in baseball do a lot of wrestling with them that my two oldest are heavily involved in wrestling they like that I don’t coach basketball I love basketball but I have someone else coach I think it’s important for your kids to hear from someone else occasionally and so I other people coach that and then they’re involved in football and soccer as well so my time is eating up with my family but you know outside of that really enjoy spending some time with my wife we like to take vacations we like to go to dinner you know those things to just kind of get away from the kids get a little break and recharge and and then go back to being full-time parents and business owners

Anthony Codispoti : what’s the best decision you ever made for your business the

Ryan Pudenz : best decision I ever made for my business outside of just starting the business which was a huge jump right because that’s that’s scary I listen I had a great role I was I made good money and I could have continued that for the rest of my life and retired and been happy but you know I wanted to challenge myself and so you know the best decision was starting it the second best decision was putting in our leadership team because that really sped up our growth in my opinion it’s a lot on one person and so I think you have to surround yourself with other people that can see your vision and can help you build it and so you know we built out our infrastructure at the at the merit level after just one acquisition but we knew more acquisitions were going to be coming and we needed to be prepared for it and I think that’s sped up the growth of our company because now we’re not hiring roles as we are acquiring those roles are in place and we can hit the ground run in day one and help these companies become even more successful and in turn make merit a success

Anthony Codispoti : what’s your schedule you hoping for one new acquisition a year

Ryan Pudenz : so last year we had four acquisitions this year we’re hoping for three to four acquisitions we’d love to see us right in that hundred million in revenue by the end of this year with some of the stuff that we have lined up and we have one that we should close here in the next I’ll call it 30 to 45 days and then you know a couple that we’re in conversations with now so that would help us get to that goal and you know while we set that goal we also recognize you know buying a business is a big commitment so if it means we can only make one acquisition this year because the other ones didn’t make sense then so be it we go back to the drawing board and we figure it out but there’s a lot of good businesses out there and now our name’s kind of spread and we’re getting approached so we have a lot of confidence in in this year being able to do that three you know three to four acquisition and grow our top line revenues to a number that we think is realistic that’s exciting

Anthony Codispoti : yeah let’s say that you and I connect again in a year Ryan and you’re celebrating something what would you hope that is

Ryan Pudenz : I think it would be that we’ve accomplished the acquisitions that that I just shared with you I think we’re pushing at 120 million in revenue I think we’re looking at some recapitalization on a couple of our businesses that allow us to have 100 percent ownership and give our investors on those original funds a really nice return and so now they’re looking to continue to invest with us on future endeavors and I think you fast forward a year from now those are very realistic and and something that we’re shooting

Anthony Codispoti : for what’s one thing you wish more people understood about the industry that you play in

Ryan Pudenz : the costs that are behind what goes into whether it’s HVAC whether it’s a remodeling project cabinetry flooring I think some people have an unrealistic expectation and I always tell folks this it’s because of HGTV because they go on there and someone redos their you know home kitchen for $20,000 the fact of the matter is you just can’t do that today stuff’s expensive and and so you know when I hear people say how can you charge that much it’s like well we have a building we have a showroom we have employees and things cost money to get and you know we’re not we don’t want to be the cheapest in town we never do we want to be the best in town and to get the best you got to pay a little bit more and so I think I wish people would just understand just I think there’s this I’m jumping around here there’s this perception of you know blue-collared skilled trade job by some people that it’s low compensation it’s not it’s a skilled trade these folks have have trainings and certifications and not everybody can do it because if they could nobody would be in remodeling because everybody just remodeled their own house right and so there’s a lot of costs that go into getting good people and putting out a good product and I just don’t know that people understand that or don’t realize what the true cost is in today’s world I think they still think back to well you’re remodeling when I built this kitchen I could build it for $10,000 now you’re telling me it’s $50,000 well sometime this past says that.

Anthony Codispoti : Now I just got one more question for you Ryan but before I ask it I want to do two things first of all I’m going to invite everyone listening today to hit the follow button on their favorite podcast app so you can continue to get more great interviews like we’ve had today with Ryan at Merit Management Group. Ryan I also want to let people know the best way to either get in touch with you directly or to follow your story or that of Merit.

Ryan Pudenz : Yeah so our website’s MeritMgt.com and on there has all the information about our companies and about us and in our story and then also newsletters and investment information for anybody that’s interested there and then they can also shoot me an email it’s ryan at MeritMgt.com and happy to share any information with anybody whether it relates to Merit or just personal experience.

Anthony Codispoti : That’s great and for those folks listening Merit is 1R and 1T will have a link to both the website and Ryan’s email address in our show notes but in case you don’t have those in front of you now you know how to get in touch with them so last question for you Ryan as we look to the future over the next two to three years what exciting changes do you see coming to your industry or industries you know kind of across the different construction sectors?

Ryan Pudenz : Yeah I think you know hopefully we see some relief on rates I think that will happen which will bring up new construction especially on the residential side and even on the commercial side so you know that starts to increase demand and you know that’s exciting to me because I think we’re well positioned to serve that demand and capitalize on that demand. I think the other piece that that excites me is again we talk about the deficit that we have here on residential homes in the U.S. and so I think you’re going to see as rates start to come down that demand goes up and we could start to chip away at that deficit and that plays really nicely into the businesses that we own and the other piece that excites me is as I said at the beginning you know this space can’t be replaced by AI it’s dependent on human interaction and I think we’re going to continue to see AI take a bigger percentage of jobs and be more day-to-day interaction but not in this space and that excites me too because you know we continue to get to have human interaction and show our skills and not worry about being replaced with them.

Anthony Codispoti : Well and you said something earlier in the interview too that I thought was really interesting about the silver tsunami so we’ve got baby boomers who are aging and I traditionally hear you know folks in sort of the senior care the home health care space talk about this and how you know demand is high and it’s increasing and there’s sort of a gap in you know what they’re able to provide and what the demand is for but you’re kind of coming at it from a different angle these same baby boomers are kind of aging out of their businesses now they’re getting to the point where they want to retire they want to slow down and there isn’t that succession plan in place and so that creates an opportunity for a group like Merit to come in and you know give those folks a nice retirement and you know be able to carry that that legacy business on.

Ryan Pudenz : Totally yeah and that you know that number will continue to grow for the next few years and creates great opportunity for us to show what we can do and you know hopefully build a relationship with some of those sellers and be able to enhance what they’ve built on.

Anthony Codispoti : Ryan I want to be the first one to thank you for sharing both your time and your story with us today I really appreciate it.

Ryan Pudenz : You bet thank you I appreciate you having me on.

Anthony Codispoti : Folks that’s a wrap on another episode of the Inspired Stories podcast thanks for learning with us today. you