From Finance to Landscaping: How Good Earth Landscaping Scaled with Smart Business Strategy

Audio Transcript

Mark Lamberth:
Hello and welcome to another episode of the Contractor Grow Show. This is Mark, and today I have the pleasure of interviewing, talking with Jeff Margulis from God Earth Landscaping in Carbondale, just right up the road from us. We’re here in Denver. Jeff, fantastic to have you on. Thank you for being here.

Jeff Margulies:
Yeah, thanks for having me.

Mark Lamberth:
Very cool. Well, I’ve taken a look and learned more about the business. Maybe you could tell us just kind of what you guys are up to today and then we’d love to hear more about the history of the business as well.

Jeff Margulies:
Sure. So Good Earth is a full service landscaping company. I would say our backbone is maintenance, but we do just about everything outside the home. We’ve been doing, really growing the construction side of the business, whether that’s new installs kind of ground up or larger enhancement projects. We have a full irrigation division, fine gardening division that does higher touch gardens, custom containers, things of that nature. We do snow removal in the winter and then a little bit of everything in between to fill the shoulder seasons.

Mark Lamberth:
Okay, fantastic. How long have you guys been at this now?

Jeff Margulies:
So Good Earth has been in business somewhere over 30 years. My business partner and his former partner acquired the company beginning of 2017, and then I took over operations and stepped into an ownership role beginning of 2018, seven-ish years, somewhere in there that we’ve been doing. It certainly changed a lot over that time period. Neither my partner nor I had a landscaping background. We both come from a financial careers, more business strategy and numbers based, but found ourselves in a situation where we had to become operators and have, I think relatively successfully been able to apply some of those business principles to a new field and grow the business a lot since then.

Mark Lamberth:
Man, I love it. I was taking a look. You went to Brown,

Mark Lamberth:
Is that right? Yep. Amazing. And then you later went on to become an investment analyst and kind of finance vp. I always love when I hear stories of folks who came out of finance at some level and went into some type of trades business that we’re always talking with. It just really tells me about that somebody like yourself has really evaluated obviously the numbers of the business at a higher level and that you’re approaching this probably from just a really, I dunno, a higher level of business fundamentals and number of fundamentals than maybe some of the rest of us.

if you need help thinking through business growth, contact us.

Jeff Margulies:
Yeah, I mean I think that’s been a huge advantage for us, especially in the green industry. I’d say the majority of businesses are owned by career technicians who happen to be successful in growing the business, but once you get to a certain scale, that’s hard to continue. And we’ve been fortunate to come at it from the other side where both of us have worked with or for really high performing organizations, and so we have the perspective of what that can look like. And it took a while before I had confidence that that would apply to this industry and this market. But over the last couple of years we’ve really been able to be a bit more precise in managing through metrics, understanding the business, understanding the cashflow dynamics so that we can invest in it wisely, especially in a seasonal business, in a market that has very short seasons.

Jeff Margulies:
I think having a good understanding of the financials is really valuable, and so that’s been very helpful for us in a way that initially my business partner identified this market when he was in business school or just after business school. His name’s Josh Austin and came to the Roaring Fork Valley on a business thesis about having a high concentration of wealth in a geographically constrained market targeting service businesses. Whereas I really just wanted to live in the mountains. My wife and I met over skiing and biking and the things that we wanted to do here. And so this was more an opportunity to live in the place we wanted to live. And so I stumbled into it a little bit more, but the fact that he had strong convictions and a thesis around the opportunity here rather than just switching careers for lifestyle on my end, it was really exciting. And so he owned a portfolio of other service businesses and I initially came in and kind of a CFO role to build a back office and think about how we leverage that portfolio to get some synergies and help them help each other.

Jeff Margulies:
And that was right after they had acquired Good Earth and in that first year kind of just saw that it wasn’t performing the way that they had expected. And I had bought a house here and wasn’t going anywhere, and so decided to become an operator and on the finance side had evaluated businesses across a lot of different industries. And so I was comfortable trying to apply that to a field I wasn’t very familiar with because at least I had that skill set of learning a new business quickly from the books and the finances and took a while to get a realistic understanding of how operations needed to behave and perform to be successful. But six, seven years in would consider myself a green industry professional finally.

Mark Lamberth:
That’s great, man. That is wild. What were you doing? I mean you and your wife Charlotte, what were you guys doing? Were you already in the Carbondale area kind of Aspen or here on the front range of Colorado?

Jeff Margulies:
Yeah, we were in Denver for about three years, so we’re from the east coast, originally met in Boston when she was in grad school, so she was finishing grad school and getting ready to start a career. I was winding up a startup that I had been in for a few years. We just decided to make the move to Colorado. Her sister and our brother-in-Law were in Denver, and so we

Mark Lamberth:
Gotcha. Okay.

Jeff Margulies:
Made an initial leap. Found out over a couple of years that Denver still wasn’t quite in the mountains and with all the growth there, it was getting further and further away. We were able to day trip to go skiing when we first got there, and by the end, that was getting less and less realistic and

Mark Lamberth:
With the girls and all

Jeff Margulies:
Exactly, well, they were actually born up here in the valley, but it was more just I 70 traffic that was getting more and more discouraging. And so I started looking for opportunities to maybe buy and start operating some type of a small business in one of the mountain markets and stumbled across a opportunity that was closer to my wheelhouse on the financial side and always thought that that might be the springboard where we would get into a mountain market, get to know it a bit, and maybe find something to buy and operate that way. And good earth kind of fell into my lap through circumstance and it’s been a pretty wild ride since then.

Mark Lamberth:
Man, that is amazing. Interesting. So Josh, I saw here in an article landscape management where they looks like the community made they get together and did an interview with you, asked you a few questions. Let’s see, talking about, well, it was great in terms of growth and investment here in the business in the last year, they had asked you how was a business last year? You said great in terms of growth and investment, we implemented new processes, software and accountability practices. It was a challenge going through some of the structural change while growing and executing on the business in front of us, but I think it set us up to really go really well for the future. So you guys made some investments and you guys kind of retrenched in things because it wasn’t operating exactly the way you had planned, and what did that look like and how did that set you guys up for the future?

Jeff Margulies:
A lot of that was initiated and that interview came through a peer group that I’m in, which is the ACE Peer groups, which is industry specific run by a group called McFarland Stanford, which was pretty transformative for me as a business leader in a field that I didn’t have experience in elsewhere. And so as I’ve mentioned before, both Josh and I have ideas about what high performing businesses look like, but hadn’t really seen that applied to the green industry. And I’d say in our market specifically being from Denver, these mountain markets a bit, people move here for the lifestyle, not necessarily for running the best businesses and no one can get a plumber to call them back or an electrician. Everyone’s so busy all the time and on a powder day probably can’t get anyone on the line. And so I was exposed to this peer group where once a quarter we go visit another business around the country.

Jeff Margulies:
So they build the groups around kind of similar scale or at least focus on similar segments of the industry. And in going to see some of the operations who had been doing this longer, we were making it up with the best ideas that we had, but someone else has solved all those problems. We just didn’t have access to them. And once we started to see that there were companies that were behaving and performing the way we thought possible and could witness that, it was really motivating to try and implement some of the structure and processes that we’ve been a part of in other businesses with a little more confidence that could be successful in the green industry. And so a lot of that focus has been around trying to build consistency and accountability in the organization so that things are done to the same standard, become more repeatable, have very clear responsibilities, whereas initially it was really just trying to fill the schedule, try to do really good work, but it required solving problems over and over and over again.

Jeff Margulies:
And there’s still a component of that. Every project’s unique, especially at the types of properties that we’re on. But at the same time, it’s allowed us to distribute some of the responsibility and try and build a culture of accountability where we can push some of the responsibility a little further downstream, elevate the crew leaders in terms of what they’re able to do and communicate and make some decisions in the field. And then we implemented a software, an industry specific software called Aspire about two years ago. Prior to that, every growing business, it was a series of spreadsheets and paper and given our backgrounds, the spreadsheets were more complicated than most,

Mark Lamberth:
Right,

Jeff Margulies:
Since that’s

Mark Lamberth:
Where analyst spreadsheet.

Jeff Margulies:
Exactly. And so that’s really, really helped to, I think, put us in a position to scale. We’ve also focused a lot on renewing the fleet and making sure that we get the processes in place to take care of it and protect those assets. So it’s been a lot of change from where we started when I was out there swinging a pick with the crews to try and make sure I understood how they did their work so that we could estimate it properly. And now we’re trying to package that up in a way that we can train people on how to use it and everywhere from the estimating through the operations of the business.

Mark Lamberth:
Interesting. How many folks do you guys have on your team these days? Maybe a fluctuate summer

Jeff Margulies:
Peak season in the summer, I’d say I think we broached about 70 people this

Mark Lamberth:
Year.

Jeff Margulies:
Wow.

Mark Lamberth:
Amazing man. Well, the next question is a lot of people really struggle with a lot of service businesses these days struggle with finding good talent, training them, motivating them. It sounds like you’ve got a lot of great things you guys have been learning here with this group about kind of systems and things regarding the people and having enough people to fill your jobs. And especially for an area like the Roaring Fork, not a huge metropolis, that’s a big crew. How do you find recruit and motivate team members

Jeff Margulies:
Had say, most of our recruiting has been word of mouth. We’ve tried really hard to take good care of our employees, and at the end of the day, they’re the ones who are making it happen, building relationships with those guys. We have a number of folks who’ve been here long before we bought the company, and then a lot of the guys who came in the first year or two that we’re here are still here. So I think really taking care of those employees, building relationships with ’em, there’s a pretty big advantage. I speak pretty strong conversational Spanish. It was dormant for 15 years before I got here, but I jumped back in and started speaking with the guys, and most of them had not had a Spanish speaking manager before, and so that made a big difference in terms of being able to unearth, that’s huge, unearth some of the skills they had, make sure we’re able to recognize the value that they bring because a lot of the time I think there’s a lot of capacity that folks have that goes unrecognized because of language barrier.

Mark Lamberth:
Oh, big time. And

Jeff Margulies:
Being able to identify things that may have gone unnoticed that were negative if we didn’t have both the relationship with the guys to tell us what’s happening or the language skills, just to be able to recognize it. So we focus a lot on that company culture and from that have been able to bring a lot of folks in who are friends or relatives. We definitely struggle on that middle management layer to find the right talent. We have an absolutely fantastic team that all of them were the first hires that I brought on when I had to rebuild the organization. And I think I just got really lucky that that team was as strong as they were because we’ve tried to find more similar folks, and especially with the post covid cost of living in a resort market. We’ve tried recruiting from other markets and it’s been close to impossible.

Jeff Margulies:
And so we’ve recognized a need to develop internal training, and that’s kind of our next step here is to formalize that and create a pay scale that’s related to internal certifications and training. That’s still very much a work in progress, but we’ve been really lucky with getting the right people at the right time and without, not without many mistakes along the way, but the folks who started here are still here. And then we’ve had some turnover in between. And I think being able to really reward and promote the field crews who are performing well has started to create some positive cultural momentum where people want to come work here and we want it to be a place that people enjoy working.

Mark Lamberth:
Man, that is awesome. So you say a lot of the growth has been word of mouth, and so a lot of these folks, they know each other, maybe they live together. These are all kind of community, the folks on your team?

Jeff Margulies:
Yeah, absolutely. And we’ve tried to do some things with differing levels of success outside of work. So every couple months we’d want it to be every month or every few weeks, but we find ourselves too busy. We do some carne asada cookouts, so we’ll hold the crew back, especially being a seasonal business, we have a number of guys who work in Aspen’s top restaurants in the winter if they don’t stay on for snow removal, and so we’ll hold the crew or two back and they’ll cook all day and then we’ll have a big barbecue. I said we probably only did it four or five times this year, but ideally it’s something we’d want to do more often than that. We also started doing, again, planned for it to be weekly. It was not weekly, but we do some group mountain bike rides. We have a trail network that’s right outside our door here and found that we call ’em the Puente rides, which means bridge. And so it’s been a great way to bring some of the Spanish speaking folks and English speaking folks together outside of work to do something they all enjoy. I’d like for that. And those types of things could be a bigger part of the business if we can find time that isn’t required that we’re out in the field working, that’s a good problem to have too, that we can’t keep up with our own demand.

Mark Lamberth:
Right. That’s interesting. Matt. I like that you brought up, you speak Spanish and that it really helps you connect with your team. Haley and I speak Spanish pretty well as well. We’ve spent a lot of time in Mexico, and so I’ve had crews up here and for different reasons, not as much building more like landscaping projects. We’ve done a number of real estate projects, but over the years, but the ability to speak Spanish with a Spanish speaking crew is really kind of magical actually. Those guys love it. And it’s neat, especially if there’s kind of American crew and then there’s Spanish speaking crew on the same job site. A lot of times those guys are sort of doing their own thing, but to be able to be a bridge there and loop everybody in, it’s really great that you can do that.

Jeff Margulies:
Yeah, I mean, we offer to pay people for their time and for language classes and with moderate uptake, but something we’re going to be, especially during the winter, we do guaranteed hours for the crews. And so if we have downtime where they’re being paid and we don’t have the work, we’re going to start offering some classes here in the office, find out if we’re actually capable teachers or not. And we also, we don’t have a preference. We don’t say we’re an English speaking company, so everyone learn English. We’re all working together. So to be more valuable to the organization, the goal is for everyone to be able to communicate with everyone else. So we do offer pay incentives for language skills, not necessarily for English skills. So whether it’s an English speaker who’s going to put the effort in to learn some Spanish or the other way around, we value them equally. And it’s been a great experience for me in terms of getting to know the culture and getting invited to quinceaneras or birthday parties and getting to the families and having young kids myself, introducing them to other bilingual children so that they’ll grow up and be better at it than any of us are.

Mark Lamberth:
Right. That is awesome. That is amazing. So I read a quote that you had written, it was just a short thing. I think you elaborated on it with someone you were speaking to online, but man, it was just a cool, and I want to hear about this. It turns out your mom is your best and wisest advisor.

Jeff Margulies:
Yeah, so my mom is in the technology world, or she’s retired now for the most part. She’s still on some boards and things like that in retirement. But her, well, she’s been in a completely different field. She’s run really, really large organizations. So she was the CIO Chief Information Officer for the Commonwealth of Massachusetts and then for Harvard University for a long time. And she would admit that she is not the strongest technology user, which she’s really good at, is running teams of people who are really good at managing technology and managing them towards much larger complex goals than anything we deal with. And especially I think is a big driver of change. That’s where when she came to Harvard for the second time, technology changes so quickly that she would come in to redevelop the organization around these changes in the technology landscape without necessarily being the technical expert herself. And so on a much smaller scale, that’s where I found myself, because I’m not the talented landscaper by any means, and it’s not my area of expertise, but having seen that she can successfully drive teams toward big, big goals without knowing the technical side of it is I think her advice has applied a lot to what we need to do. And she been really successful at doing that and always has really good advice for how to do that at our scale.

Mark Lamberth:
That is awesome, man. So when you were going to go buy into this building, buy into this business and make this all happen, you guys are taking on risk and whatever, evaluating this whole thing, I’m sure you talked with her about it. She’s like, well, I’ve done a similar thing at even larger level. I mean, you guys talked about it plenty, I imagine. And she steered you well, it sounds like.

Jeff Margulies:
Yeah, I think so. I mean, one of the things that she has always stressed because I like to move fast. I want things to happen quickly when I think I know where they need to go, and I definitely have a tendency to try and drive them myself intensely. And it’s very different when you need a team to do that with you. And so she’s always stressed the importance of listening, understanding the experience they’re going to have going through this change. Just because I think it’s the best idea, the right thing to do, doesn’t mean that I can necessarily drive it at my pace. And with my career in finance, my wife chagrin, I will still work through the night in the office to get things done, and I apply that pressure to myself, and she’s really good at reorienting me around. Okay, that’s great if you’re going to do it yourself, but how do you bring your team along?

Jeff Margulies:
How do you make sure that you’re doing it in a way that’s going to be sustainable? This isn’t a deal. This isn’t operation you need to, it’s not getting to that one endpoint and then exiting how do you build it to be enduring and so that it can continue to do that without you. And the importance of paying attention and listening, which my wife has also shared with me. Once I have my teeth in on something, I want to go as hard as I can until I feel like it’s where it’s so supposed to be. And it’s very different in terms of trying to do that with the team and making sure that things land the right way and people are motivated and aligned with you. And so both of them have been great advisors for you. And my father as well, who had an architecture firm in Boston has been through similar things and cycles and building those teams. And so I’m very fortunate to have good advisors in my family because no shortage of problems to throw their way.

Mark Lamberth:
Right. That is fantastic, Jeff. That is cool, man. It’s great to hear your story of your folks and your wife and how they’ve contributed to you making good decisions in business. I mean, I can see that one of your skills has been to go out and find the people to not just count on your own ability with this group, with the ACE group and with some of your advisors and family and folks sought advice outside yourself, and sounds like that’s been excellent.

Jeff Margulies:
Yeah, absolutely. And then even internally, certainly trying to create a culture where people are encouraged to bring those ideas forward. So there’s pretty much, everyone here is about a landscaper than I am. And I think it’s probably one of the advantages that Josh and I have not being from the industry, is we’re not committed to doing anything any way that we’ve learned or seen. And so we’ve been able to get a little bit more creative in our approach. And over the years have seen a lot of our management staff and our field employees bringing their ideas on how we could do things better. And that’s something we need to further promote because I do think there’s a ton of good ideas in the organization that we don’t see the crews are a lot closer to it than we are, whether it’s the tools that they’re working with or the things we need to be communicating to them ahead of a job throughout the day, we really want to try to invite more of that dialogue because we don’t see it nearly as closely as they do. And likewise, if they feel encouraged to bring those ideas to us, hopefully they’re thinking a little bit more critically in the field about their own performance and how they can approach things. So I’d be lying if I said we were there, but I can see some glimpses to getting there that are really encouraging.

Mark Lamberth:
That’s fantastic advice, man. I love it mean. Can I just ask you maybe last question? I mean, how do you ask your team to come give you their good ideas? I mean, some folks maybe they think their team is even nervous about doing that, or they don’t have a process for how they would do that, or they don’t even know how to begin that. I mean, if I wanted to go to my team and say, listen, I want to put this in place. You guys are out on the field every day, things that should be done that we’re not doing, I’d like you to bring me your best ideas. How would you go about doing that?

Jeff Margulies:
I think the first thing is creating the right forum for it. And the time, I can say that it was something, it was all lip service for a long time. We told everyone we wanted them to do that, but then we’d get in out the door, get back tired, and it wouldn’t happen. And so what really started to kick it off was prioritizing it and saying, setting aside time to at least speak with the crew leaders and say, tell us what’s going well. Tell us what’s not and how do you think you can solve it? Or what recommendations do you have? And inviting that conversation. So we’re doing a much better job of that now. But it was a really hard thing to prioritize. We would just tell people to give us their ideas, but we were never there to listen. And then I think the second one, even if it’s starting with small things, it’s making sure you actually follow through and respond to it. And I think that’s something that we definitely failed at early on where people started to bring us their ideas. We finally found the time to listen, but didn’t find the time to execute on it. And so that became, I think, discouraging to a lot of people where they’re like, well, we’re sharing our ideas, but nothing’s happening.

Jeff Margulies:
And so that’s been shifting where we now have weekly meetings with the crew leaders, try and get those observations and at least pick up on a couple of them where we can show some type of visible change where they can see that their ideas are being listened to and something’s happening. And even the ones that we can’t necessarily do anything about right away, that we can kind of keep those on a list and acknowledge, Hey, we know you mentioned this. We’re not really in a position to make those changes right now, but we’re reminding you that we heard what you said and here’s something we’re thinking about for the future. It’s really helped to elevate the discourse that we have with the crew guys, and they really do have a lot of great ideas. So I think, I hope that’s something that we keep leaning into and do more and more of.

Jeff Margulies:
And we’ve added a HR manager who’s bilingual, who is kind of a unique position. He worked on a crew of ours years and years ago, and then was in the restaurant industry for a while, and we reconnected. And it’s kind of a hybrid role of managing hr, but it’s really being a liaison between the field and everyone else, especially with the language barrier, to make sure that there’s always someone that they can talk to and share ideas with and that they don’t get lost in the mix. And he’s been fantastic. His name’s jj again, he haven’t been doing that long enough to know how far we can take it, but even in the first couple months of him being here, I think it’s changed the relationships that we have with a lot of the guys for them to know that that form exists. And even a lot of his initial feedback that he got from the crews was, everyone’s too busy to listen to these things. And at least we could say, well, we acknowledge that we agree that we have not done what we said we were going to do in terms of trying to bring everyone into the fold, and here is the change. We went and found someone to help us do that better. And so far, that’s been really helpful.

Mark Lamberth:
Wow. Wow. What an interesting journey, man. I really, really still journeying. Yeah. Yeah. Just really relating to different parts of it. It’s fascinating that you didn’t come from a background in this particular industry and instead approached it from just sort of understanding the potential and from this higher level of looking at having looked at many, many businesses and understanding how to look at numbers. I love that stuff. We look at business fundamentals and we’ve looked at and made some offers on businesses at different times. I just love looking at cash flows and balance sheets, and anyway, I can nerd it out on that stuff all day. Absolutely. I’m talking with Jeff Mar at Good Earth Landscaping and Maintenance over in Carbondale. Jeff, this is awesome talking and I’ve learned a lot. I’ve taken some great notes here. If folks want to get in touch with you and learn more about what you guys are up to, what’s the best way to do that?

Jeff Margulies:
I’ll shoot my direct email. It’s Jeff jff@goodearthaspen.com. Yeah, I would love to hear from anyone with questions. Likewise, anyone in need of services. We’re happy to help out where we can, and we’re starting to branch out into some other markets, so hopefully someone hears this somewhere, we want to do some work, and we’d be happy to partner up and show what we can do.

Mark Lamberth:
Fantastic, man. Yeah, they’ve got a beautiful website over good earth aspen.com. A lot of incredible photos of the landscaping work and sort of hardscaping that you guys have done. Beautiful waterfalls, and I dunno, we could talk about it a lot. I love just that you guys have done a lot of beautiful work around your community. You get to look at it every day. You talked about that. But anyway, guys, go take at goodearthaspen.com, take a look at the beautiful work that they’re up to. Jeff, thank you for being on the call today.

Jeff Margulies:
Yeah, thanks for having me. Appreciate it.