How a Bold Acquisition Fueled 5x Growth for This Omaha Construction Company

Audio Transcript

Mark Lamberth:
Hello and welcome to another episode of The Contractor Grow Show. My name is Mark, I’m your host, and today I have the pleasure of speaking with Alex Post:, who is the VP of commercial construction at NATA Contracting in Omaha. Alex, thanks for being with us today. 

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Alex Post:
Yeah, no problem. Excited to be here.

Mark Lamberth:
Yeah, fantastic, my man. Cool. Well, it looks like you guys are doing some really cool stuff over here in Omaha. Maybe you could tell us a little bit about the history of the company, what you guys are up to right now.

Alex Post:
Yeah, so just a quick minute history. The company was started in 1977 by one of my partner’s fathers, and he ended up buying the company out in about 2016 17 from his dad. They did a lot of residential exterior construction. They were doing interior construction, bathrooms, basements, kitchens, that sort of thing. And Nick bought it from his dad. Jerry and Nick had a dream to get it a little bit bigger or grow it bigger. And over the last, I’ve been here about, well, technically working here about five years, four years if Covid was kind of pushed it to make a change.

Alex Post:
So there’s three of us that own it now. Nick is still majority owner, and then there’s Chuck Hall and me also that are minority owners in the business. So the company’s always focused on residential exteriors, insurance work, that sort of thing, restoration. That was always the bread and butter. I have a general contracting background in commercial. I was working for a GC at the time and in about in 2020 thought I was going to get laid off because we did pretty much all interior office and when everything got shut down, we weren’t allowed to do any construction in any of those. Also.

Alex Post:
So Chuck has been my best friend since kindergarten. He is been the best man at my wedding. We’ve known each other since we were four years old essentially. And Nick Nata is his brother-in-Law, and he is seven years older than us, and he had started dating his sister when they were in sophomores in high school. So pretty much known Nick all my life. And so I called them, they were the first call I made and I was like, yeah, I think Chuck and I talked all the time being really good friends and stuff, and he was running the books for Nick and doing kind of strategy, financial strategy. And he came over in 2018 I think, and kind of voiced my concerns and I was like, yeah, I think I’m going to get laid off because of Covid and I’m not really sure what’s going to happen.

Alex Post:
I kind of had a new house. And so it started with, well, why don’t you come help us do decks and stuff like that, put my tool belt on and go. And I was like, okay, that’s fine. And I wasn’t used to doing that. I was doing a lot of project management. And then at that time we, about an hour later, we had the grand idea of starting to bid commercial general contracting work like apartments, multifamily, lots of that type of stuff. So we called it residential style commercial construction. So it was just on a larger scale.

Alex Post:
So from that march of 20 till, I would say April of 21, I was doing two jobs and my normal job, and we were then at night, I would stay up till about midnight doing takeoffs and trying to get this thing going. And it was really just a way to make extra money At that time. I had a new baby, I had a new house, I had all that. And the company I was working for before, we were mandatory pay decreases and stuff like that because of Covid. And I got lucky we never missed a paycheck or anything like that, but it got scary there for a minute. So it was just started as a side gig bidding stuff. And in that first year of 2020 to 2021, we bid about $30 million worth of work and we got zero of it. No, man, it was probably the best thing that could have happened honestly, because if we would’ve just started awarded, if we were just got awarded projects, we were probably been in a world of hurt when I was doing the estimating on it. We would put a bid in and then just try to get feedback and really tighten our numbers down. And so after about a year of doing that, we all had lunch together one day and they’re like, do you want to make this a full-time thing? And I was like, well, I think we should get a project first before we actually do something here,

Alex Post:
A big one. And I remember sitting there and Nick was like, I think the reason we’re not getting projects is not all in. And so I had, my son was born on April, no, March 15th. And on April 1st I started here on a brand new adventure. And it was quite the transition in that from we started to win the work and just like that it kind of was off and running on the commercial side of things. We thought we were going to be a commercial roofer doing apartments and stuff like that. And slowly figured out that not slowly, probably rather quickly, that our specialties was more in the wall systems. So James Hardy siding, metal wall panels, LP smart side, the first or second dito we put in. I went and got feedback from the general contractor and I was like, yeah, where did our bids stand?

Alex Post:
And they were like, oh, you were fourth on the roofing side. And I was like, oh, okay. I was fourth out of how many, and he was 17. And I was like, you had 17 bidders on this? And he was like, yep, sure. And I was like, well, where did my siding number land out? And he’s like, oh, well, you were second on siding. And I was like, oh, well, how many siding bids were there? And he was like, three. And I was like, oh, okay. Well, so we quickly made the move to try to, he cut your competition in fifth, essentially.

Alex Post:
And we found it’s not as quick hitter of projects roofing. You can go in and do large scale stuff that for a month and get paid for it rather quickly. And siding takes a little bit longer. And so that’s probably why there’s not a lot and there’s a little bit more barriers to entry and product’s a little bit more expensive and all that. And the projects take longer. But in the end, it seemed like it was a better move for us. And then we just started winning projects in 2021 and 2022 and things got off and running and it grew larger and faster than we ever thought. And just, it’s been a lot of fun growing it. We’re nowhere near being done about two years into it. So in 20 23, 20 22, late 20 22, 1 of our competitors came up for sale. And against all advice from anyone, we decided to buy them.

Mark Lamberth:
No way. I love it.

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Alex Post:
Yeah. So that’s a whole nother story. But they joined and they had contracts was the big thing. And they had combined probably 200 years worth of five guys had they had years upon years of experience in wall systems. We were doing fine getting the projects, it was getting through the projects was our hard part. It was quality control, it was everything that involved the actual installation. So we knew we needed help, and this was kind of just dumb luck. And we ended up purchasing that company, bought all their assets and their contracts, and it came with about five managers and then a crew, an install crew of three managers really, and then an install crew of five. And so eight guys that came with us and three of the managers, they very high end install everything that goes with it. And then coincidentally this year, the man that we purchased the business from, he was off doing some other ventures and they weren’t quite, he wanted to go build some custom homes and stuff like that, and it wasn’t quite going the way he wanted. And I was like, do you want to get back into the siding business? And actually the guy that we purchased the company from is working full time helping me run the general contracting or the commercial side of things. So that

Mark Lamberth:
Is awesome.

Alex Post:
Ridiculous thing. And it is probably the proudest moment of, I guess our career was, or my career is we discussed this, all right, it’s going to cost us a bunch of money. We’re going to put mortgages, second mortgages on all of our homes, all this stuff to pay for it. We’re sitting around the table at the signing to get a loan and all of our wives are there and our banker’s there, and he’s just like, are you guys sure you sure want to do this? And our wives are all just rolling their eyes, this is the dumbest thing I’ve ever been a part of, but you need our signatures. So we did it and it worked out, and it’s kind of crazy, but a proudest part, my moment or press moment in my career so far has been those guys made a promise unannounced to us was to the guy that we bought the company from that they would stay a year, so that a minimum of a year, but after a year, they would make their own decisions if it was a good fit or not or anything like that. And every single one of those people that we purchased, every single person that was on that company that we purchased is still working for us today. So we created an environment that all those, yeah, it’s amazing. And they’re a vital part of where our business has gone. And yeah, we were doing about five x what we were doing in 2020 and 2021 next year could be, I mean, we could be 10 x really easily, at least six, seven.

Alex Post:
And we’re doing it profitably too, which is the amazing thing every time. Previously it was the business before was always just, it paid for the wages it paid for. If there was a little bit of profit at the end of the year, it was great. But now we’ve really kind of turned the business up on its head, and it’s been really fun to do and build it with two of my best friends and then a group of guys that I’ve never met before and then really close. We work with them every single day. Two of them, we share a 12 by 15 office right now. So there’s three of us in a little office, but there’s a lot of collaboration that goes on in that room, and it’s all better for it and smarter for it. So yeah, COVID kind of pushed me into this.

Alex Post:
I always thought I maybe wanted to have my own business, but I was making good money at a general contractor. It was low stress, it was everything, but you knew there was just something missing. And then we made the jump, and it’s been now the first two years that we did it, I think I averaged about two hours a night in sleep. A lot of worrying, a lot of, yeah, your mind just goes and it’s, you think about all the stuff that has to happen and just out of your control too, and you’re like, man, what happens if this goes up in flames? Where do I go?

Mark Lamberth:
Yeah.

Alex Post:
But fortunately, it’s really worked out and we’re on year almost four of having these guys, or well, year three really of having these guys on our team. And we’ve accomplished way more than what we set out to do, and we are really, really striving to do more and more. So it’s been fun, but we’re still small enough that every time we get a contract signed, we get to celebrate it a little bit. And high five, we finished the project and it’s just great and it’s fun.

Mark Lamberth:
Amazing, Alex. So I love this strategy of growth by acquisition. That is just such an interesting way to grow a company because you can, it’s like a quantum leap and happened to many different levels. You could a whole new set of customers, but this also acquisition of talent. So since you acquired this other company, I mean you guys have grown multiple X multiple sizes larger since then.

Alex Post:
Yeah.

Mark Lamberth:
And it’s been directly responsible for that, correct?

Alex Post:
Right. Well, we were winning right before we purchased them. We were winning contracts. And it got to a point where we’re like, we don’t have enough people. We don’t have enough management. We don’t have enough experience running these big things. We need to make a decision on what to do and we need to do it very quickly. We thought maybe we were going to have to go find a guy, pay him a really high salary to help us come and project, manage and run these type of projects. Somebody that had experience doing that. Like I said, it was just kind of dumb luck. One of our suppliers that we both bought from came to us and was like, Hey, I don’t know if you guys know, but this other company is for sale and I kind of wanted to bring it to you. And so we just kind of had a conversation over breakfast one day and one thing led to another.

Alex Post:
But then the best part about it was it raised our level of quality and quality assurance and confidence too when we’re going after bidding projects to larger heights where previously when it was just me bidding or just me and a guy bidding projects, we were always like, yeah, we’ll do this, but I don’t know who’s going to do the work. We’ll figure it out when we get, if we win the project, well now it’s like, all right, we want to win this project. We know exactly who we want to put on this and who’s going to run it and who’s going to run it really well. So

Alex Post:
In the beginning it was a little bit of smoke and mirrors, but now it feels like, I always tell, I’m a big sports analogy person, so I always tell when I’m trying to sell our company, I believe that we have the best starting five if you take our five core group in the area for sure. We have just really good guys that are very knowledgeable, they’re very levelheaded in construction. Things can get heated sometimes and never once do we have people that really raise voices or anything like that. We just deal with the problems head on. And that was always my, coming from the general contracting world, I was like, all right, now I’m going to be a subcontractor. The way I want to run this business is I want to be easy to work with. And then if maybe that first round of contracts, we’re not going to really make that much money, we’re figuring it out, but we’re going to wow them with our service and attending the meetings and doing things and just doing the right way communication.

Alex Post:
And I’ve always stuck with that, and that is how we’ve built it so far, and just reoccurring contracts and reoccurring general contractors. But it’s no secret. We’ve gotten better at what we’ve done too and more confident and so on the front end of things, but we’re confident in our ability to perform ’em too. So it’s been, yeah, it’s really that quantum leap is, I think we would’ve got to the point where we’re at right now, but it would’ve taken probably five to six years, five to seven years. And then when you acquire those guys, it was just like, alright. You instantly have that knowledge that can help. And it’s been a match and it’s been really fun. It’s been really fun to get to know these guys and everything too. So

Mark Lamberth:
Amazing. So man, I mean, you’re a young guy and you’re smart as hell. You’ve got a lot of interesting stuff to say about this. I assume you haven’t acquired too many companies in the past. No. When you and the guys got together and your wives and your team got together and said, we’re thinking about doing this, who did you consult with and talk to? And what I’m getting at here is, I mean, if someone else is thinking about, we’ve got our concrete company, we want to acquire a painting company right next to a related service or something that’s going to work well for their business and they’re thinking about buying a local company, how did you learn more about the process and how did you get some advice on how not to lose your ass on this whole thing?

Alex Post:
Yeah, so Chuck, the other partner in our business, he has an MBA, he’s been in finance. He is worked for one of the top five largest general contractors in the country doing accounting for them and stuff like that. And he’s always had entrepreneurial spirit, and this is kind of what he is always wanted to do. So he’s a big nerd when it comes to this stuff. He wants to acquiring businesses and doing all this stuff. And at that time it was silly. We didn’t have money to do that. We had credit cards maxed out, we had truck loans, we had lines of credit extended, we had all this stuff. We barely, I mean, by all means, it was not smart. I remember he went on a construction business almost like a podcast type thing and said this story, and he was like, this is what I want to do. And the guy was like, you’re an idiot. You’re not profitable. Why would you think buying this company will make you profitable? And he’s like, I just got a gut feeling that things are turning. We were winning contracts, we were doing stuff like that, but the money wasn’t

Alex Post:
Coming in yet. So we probably had two to $3 million worth of contracts that were signed, but in the commercial end of things that those don’t really come to fruition until 24, 3, 6 months out. And so he consulted with some people, we consulted with our banking advisors, all that type of stuff. And I remember our banker was like, yeah, I mean you guys, you couldn’t do it and we’ll extend you a small business loan to do it, but are you sure this is what you want to do? And honestly, it was kind of like a gut thing and it was almost, it wasn’t that we were dead by any means or anything like that, but it was like it’s something that we just felt that we had to do to try to leap us forward or into where we wanted to go. And it was scary, honestly, signing something that big, but we knew what we had coming down the pipe.

Alex Post:
And so we kind of consulted with him. He’s got the business sense, he runs all the management. His title is Vice President of Finance and Strategy. So that was a big thing and strategy. And he lays everything out. He knows the numbers he’s got, I do all the estimating, but I run every try to get a second set of eyes on everything where we like, Hey, does this make financial sense? This is what I was kind of thinking, he’ll give his 2 cents. He by no means micromanages or anything like that, we were all in it together. But yeah, he felt strongly, it was like, this is something that we should do. This is an opportunity that I’m not sure that we could have otherwise, and it’ll probably be the only company we ever buy. Because when you think about it, and maybe not, but when you think about it, it’s just like if our competition goes away, it just means more people are winning that work and that sort of thing. But it got a giant, like I said, it just was a giant leap forward on it. But yeah, that’s who we kind of consulted with. We sat down, we all three talked to each other. We’re like, okay, here we go Now we weren’t all in. Now we’re all, we weren’t all in before. We’re all in now.

Alex Post:
But fortunately it’s all worked out. The way we structured it is we saw what their contracts were, what the projected profits were on those contracts, and what we said was like, all right, we’re going to buy this for X amount of dollars, but the contracts that they have should pay for this business then. So it’s not about the contracts that we’re signing right now. Those will essentially pay for it. It’ll be about the reload after that. So if we can continue to win the projects and have these guys on, that’s when we’ll see the big plus. So that was two and a half years ago and we’re almost done with the final project that came with that, or three years ago, almost final project that came with the acquisition. And we are still taking every dollar of profit from those jobs that were on there to pay off that loan and it’ll be done after that. So it just worked out just essentially perfectly what we thought. But yeah, there was a lot of consulting that went wrong and with each other and then trying to find outside sources to help and stuff like that. But everybody thought we were kind of nuts, but we had a gut feeling that might work. And so at that point it was like, alright, not a hail Mary, but it was almost like, alright, we need to do something to change the trajectory of this business. And that’s kind of what we did.

Alex Post:
And we were still doing bathrooms and kitchens. We were a residential exterior company that had employees. And then the thought was always, we need winter work for our guys. There’s not a lot of, so let’s do some bathrooms, let’s do some kitchens. And then it got to a point at the end of last year where we were saying, the juice isn’t worth the squeeze when it comes to the interiors business that we were doing. And we actually shut down that whole side of our business. We discovered if we have to go into someone’s house, we have to go inside. We don’t make money. And it was very hard, and I’m not saying that it was a very hard decision, but it was clear to see where the trajectory was going on the commercial end of things with the exteriors where it needed to go, where we wanted it to go.

Alex Post:
So that was a hard decision. There was a lot of people that, there was three or four people that we had a design, an interior designer on staff, we had a project manager, we had a carpenter, we had people that were dedicated to that side. And it was almost just kind of like a breakeven business that was just kind of plotting along and it didn’t make sense to keep it around as we were trying to grow it this other side. So yeah, some tough decisions that came and that sort of stuff at the end of last year. But yeah, so we’re better off for it.

Alex Post:
I think we’re, as a company as a whole, we’re just about five x of what we were three years ago, and that’s with cutting out a whole section of our business that was revenue wise, 50% of our business three years ago. So it was tough decisions, but it’s been fun. It’s hard, but it’s rewarding at the same time, let’s put it that way. And so now we’re just solely focusing on our commercial, on our residential and commercial exterior side. So we have a team that is dedicated to restoration, so that’s insurance game on the residential side and also commercial properties. And then we have a commercial new construction side where we’re bidding to a general contractor and it’s new apartment buildings, new office buildings new, anything like that. And so those are the two sides of our business now that we have residential exteriors and commercial exteriors. And it’s been, it’s the right model for us going forward. We know that.

Mark Lamberth:
Yeah, man. I saw here on your Facebook page just a big serious, looks like multifamily construction. Is that the banner at the top of your Facebook page? Is that what That is a project you guys are building out?

Alex Post:
Lemme look what it’s on our Facebook page.

Mark Lamberth:
It’s kind of black and white in the city there in the background.

Alex Post:
Hold. Let’s see here. Yeah, so that is one of the projects that came with the company we purchased. The cool part about that project is it’s low income housing and they redeveloped that whole area. It was Davis Bacon work, so that means it was prevailing wages, it had a bunch of different buildings and multicolor and all this type of stuff. And it was for a general contractor that we had never signed a contract with. And then now that general contractor has turned into about 20% to 25% of our commercial contracts now. So we really took that and ran with it and it’s was a really nice learning experience, actually, I’ll call it that. So yeah, that was a fun project to be on. And again, not that it wasn’t with its challenges or anything like that, but we always have, one of our guys who was one of our project managers foreman, he always says, I’m not working for this paycheck, I’m working for my next paycheck. And we always take that and we always think about that as like, well, yeah, we’ve got this contract for this project here, but it’s not about this contract. It’s about the next one that we can get. Interesting. I always stress that to our managers where we always have no matter what conversation you’re at, and none of my guys are sales guys, they’re construction guys, they’re very to the point.

Alex Post:
They’re not going to go out there and smooth talk you or anything like that. But in commercial world it’s fine, but I always say, you need to leave every conversation better than we had it or when you walked in. And that’s the sales portion of that. So always, if there’s a problem, make sure it’s solved before you leave or make a plan to solve that problem and just always be able to communicate. And every conversation we have is selling ourselves. And this has happened on multiple projects where us and our competition are very close on numbers. And the final person that gets to make that decision is the onsite project manager for a lot of these general contractors. And they’re like, Hey, would you rather work for this company or would you rather have this company doing your siding or NATA doing it because the numbers are so close, you just choose. And he’s like, well, I want nata. I like working with these guys better. And it’s like, that’s the conversations that we want to have. It’s like, all right, numbers are close, they’ll give us the benefit and they like working with us. So that’s kind of how we want to build it or how we have built it and how we want to continue going about it too. But yeah, we’ve done some really cool projects. That’s one of ’em.

Alex Post:
We’ve got a nine story building that we’re doing right now that has a bunch of metal panel on it had to buy 125 foot aerial lifts to do it. So I’ve got 12 to 15 guys down there installing at any time, 125 feet in the air. Previously the highest job we had was 85 feet, and that was just on the one little portion. So we ended up having to make a rather large investment in buying two giant lifts to service that project. It was the largest, well, or at that time, I think it was the largest contract that we signed. It was quite scary. It was a lot of stuff that we weren’t quite confident in how it was going to go on, but it’s been a giant learning experience and it’s been a lot of fun on that one. And right in the heart of Omaha where everybody can see it and it’s been,

Mark Lamberth:
Oh man, how

Alex Post:
Awesome. That’s with that same contractor that we were doing that project on our Facebook with.

Mark Lamberth:
That’s so cool.

Alex Post:
Yeah.

Mark Lamberth:
Well, so one thing that listeners struggle with, some contractors these days in the trades, it’s hard to find guys that are motivated that want to learn your way of doing it and that stay around that you can retain. And I mean with you guys with this acquisition that you had this key part of your business, it was even doubly and triply important because probably the acquisition and the cost that you guys paid wouldn’t have made sense if everybody did leave after a year. But now that they’ve stayed on, it works at a whole different level. That’s really, that was a key part of you guys’ investment in that. So with all of that, it sounds like you’re great at retaining team and really creating culture that works. What’s your secret?

Alex Post:
Honestly, I don’t know. It’s just being ourselves. Honestly. I kind of take the same approach to our employees and management and running a business. I do when I going in, we’re on a job with the general contractor, it’s, I’m not going to be a pushover, but I’m going to be easy to work with. And if so, that doesn’t mean that the general contractor can just be like, Hey, I need you to do something and I’m just going to jump and do it for free or anything like that or be taken advantage of or anything like that. But when it comes to our employees, we have some really, we just have high-end guys with high-end motors that are, you got to tell ’em to go home at night. And it’s just a complete opposite of where we were four or five years ago or where I came from, different general contractors where it was just like, you’re working for a company with 2000 employees and you go in and you do your eight hours and you go home and you don’t even worry about it and you shut up. Well, these guys, they really care about what the product is.

Alex Post:
They see the work that goes into it, and all three of us are still, we’re in the fight with them too. It’s not like we’re in some c-suite where we’re looking and they’re running, we’re looking down and taking vacations, and we’re in the fight with them. I mean, I’m only three, six years old. I’m in here every day working with them hand in hand. I think they appreciate that. Same thing with Chuck and Nick, so it’s kind of like a lead by example type thing, but everybody has their role here and everybody’s kind of fell into that, the right mold. Now, the biggest complaint I get with some of my guys is I don’t know what my job is. And I say, well, you guys are Swiss Army knives. I was like, you’re good at everything. I was like, so that’s the hard part. One day might be doing estimating. The next day you’re going to be project managing. And hey, if I need to go do some quality control, I’m going to send you out there and do some of that and

Mark Lamberth:
Keep it.

Alex Post:
It can get frustrating for some of ’em, and I get it. And that’s part of our growing pains too, where we’re not a company with 2000 employees or 500 employees where you are going to focus on estimating and you don’t leave your chair. It’s like, no, we’re all in this together and we’re kind of growing and we’re not kind of, we are growing it and everybody can kind of see that. And we just signed up or just got a notice and proceeding on a project that we had been working on for two months today, and we all high fived and had a good, we’re like, all right, let’s go. We we’re excited about it and everybody feels that, and in the end we’ve set up, so compensation for those guys too is the company does better. They do better. It’s, we’re an open book when it comes to the financial ends of things, and especially for those guys. And we want to share in what they’ve helped us build too. But the culture, I pride ourselves on being easy to work with. And that’s not just contractor to subcontractor, that’s also owner to employees,

Mark Lamberth:
But

Alex Post:
We don’t get taken advantage of either. So there’s a fine line there, but that’s how we’ve kind of created a culture. And now is everything perfect every single day? No, it’s not. And we’re still going through those pains and everything. You’re just not going to do that when you’re not going to not have growing pains when you’re growing kind of as fast as we did. And we’re still kind of figuring out day to day, we’re going to be smarter day to day, we’re figuring out better ways of doing things. And everybody’s a part of it though, so it is been fun.

Mark Lamberth:
That’s fantastic. Fantastic, Alex, well thank you so much for jumping on here and sharing the story of NATA over in Omaha. If folks want to get in touch, what’s the best way to reach you guys?

Alex Post:
Yeah, so go ahead. You can call the office. That would be, because I call the office so much. You got to look up the number, huh? Yeah, I do. 4 0 2 6 8 0 5 1 9 9. Or you can always email me directly. It’s just Alex, a LEX at NCI omaha.com, and I can always get you directed to, if you have a residential reroof or a re side or any problems with your existing commercial or residential building, we can always help out. And then on the general contracting side, got a big project. You’re an owner, you’re a developer, you’re anybody that needs budgeting architects. We talk with architects all the time on different budgeting for different products and projects like that. That’s how we feel free to give us a call or shoot us an email. We’re happily love doing those budgets. We figure it always gives us a leg up on the end of a project too, so when it does come time for final bids and stuff. But yeah,

Mark Lamberth:
That is awesome. I think Alex and his team are AC company to watch and Omaha guys. These guys have got a lot of really cool stuff figured out. They built a great team, a great business in a short period of time, some really interesting ways. So Alex, thank you so much for being on the show, man. It’s been really fun.

Alex Post:
All right, thank you so much.

More Construction Growth Strategies from inside the Industry here:
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