The Importance of Trust: How Ali Moghaddam Cultivated Loyalty Among Subcontractors and Clients

Audio Transcription

Mark Lamberth:
Hello and welcome to another episode of the Contractor Grow Show. My name is Mark, and today I have the pleasure of interviewing an interesting guest, Ali Moghaddam, originally from Iran that now builds stunning custom homes in the Bay Area. I’ve seen some photos, they’re incredible. Ali, thank you for being on the show today.

Ali Moghaddam:
Of course, thank you for having me.

Mark Lamberth:
You’re welcome. It’s exciting to hear your story. So I mean, Haley talked to you a little bit about your journey and I think that you’ve got some great stuff to share with our audience. Maybe before we get into that, maybe you could tell us just a little bit about Almo Construction, the history of the business, and where you guys are at today. Sure.

Ali Moghaddam:
I started doing the construction business since 1999 as a handyman, and then I started growing and thinking about the beer company and then I was thinking about to name my company, how should I name my company, the Almo Construction. It came out from my first name and my last name, two letter of my first name and two letter of my last name.

Mark Lamberth:
I got it.
If you like this podcast and are learning a ton about growing your remodeling business, then you should check out some of our other Contractor Grow Show Guests.

Ali Moghaddam:
And then in 2005 I started, my company was grown and my client had so much love me, they pushed me to go get my license. I was doing their small jobs and then I was really into construction and I love what I’m doing and I see this is, that’s it. I’m going to do only construction, nothing else. And then I got my license, I study, and then I got my license on 2005. And then I saw the business, the first job I’ve done, I thought about it, forget about any profit, I just want to make this guy happy. And when I finished that job, they started advertising for me and then the word of mouth, it become my best tools for the advertising. And then since 2005 as a licensed contractor, the Alamo Construction Incorporated born on 2005 and then since then we are busy and then we are doing nothing but the best for our clients.

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Mark Lamberth:
Man, I heard that. I actually want to share my screen here really quickly, Ali, because I want to show the level of quality of what you guys are doing. So you see here, you guys can see my screen. If you’re online, look at these houses that Ali’s building, right? So I mean these are named houses. These are just high end in the Bay Area. Absolutely gorgeous. So Ali, you started as a handyman 20 plus years ago. How did you move into building super high-end houses? Where did you learn to do that and what was the path to getting there?

Ali Moghaddam:
Okay, there is two reason. Number one, I always tell everybody, whatever you want to do, make sure you love it. If you don’t love the job, you just want to go make money, don’t do it. Do something that is your passion. That’s number one. And number two, my background. I used to have a children clothing factory and I used to design the clothing for the children, which is love color involved. And I was the one who designed it. And then when I came here year, I was working for my uncle who was a contractor, but he was doing the small scale projects. And then when we started working together, same time I was searching for other jobs, should I go and study more about the computer science? Should I go do this and that? I couldn’t confess myself to go to do any other jobs.

Ali Moghaddam:
And then my knowledge also goes a little bit background back home. My late father stepfather was a builder next to the Iranian Sea. He was building the massive villa. And then on the summertime I always been with him and I look at him and believe it or not, when I was a little bit little kid, when he was cutting the check, I used to make a fake checkbook for myself and acting like him. And when he had a meeting, when he was cutting the check, it was my dream that one day I have a checkbook in my hand and write a check.

Ali Moghaddam:
Yeah. That’s why I came here and I love what I’m doing. And then somehow I told myself, you know what? That is it. That’s what I like to do. And it start learning from the designers. I had a very good chance, the first couple of jobs I had, it was a huge projects in the afternoon. One of them was 14,000 square foot. They hired the designer from the London. They flew him every month to come here and then he designed the house and I keep learning from them and so I keep talking and arguing with them. I start listening to them. Then all of a sudden I glow and everybody around me, they said, you know what? We cannot even do one day of your job because I am not only concentrating on the project to make the customer happy, make my worker happy, which is very important. Make my subcontractor happy, get the financial, get the projects. It is not easy. Some of the folks, they come here and they think, oh, they said United States the land of opportunity. Yes, it is land of opportunity,

Mark Lamberth:
But

Ali Moghaddam:
It’s not going to answer you in couple of days. It’s not the lottery. You have to work for it. And they get, and also from the beginning, they started a lot of birds and vessel. When I started my company, I didn’t go get the big truck, big office. Instead of all those overhead I injected to the job and not charging my clients so much. He say they’re happy and that would be my portfolio instead of having a big truck and big sign out there before I make money. You know what I mean?

Mark Lamberth:
Absolutely Amazing. What’s the size of your team right now? You have a lot of subcontractors?

Ali Moghaddam:
Yeah, we have a lot of subcontractors. About 120 people working for us daily. 10 of them, including myself, 10 of them is our own staff from the office, from general manager, from the manager and also we have a few people. They are working pickup works, cleaning, and one thing really important is really important for me is to keep the job site safe and clean. That’s very important. Yeah.

Mark Lamberth:
Okay, great. So English is not your first language?

Ali Moghaddam:
No.

Mark Lamberth:
You came over here as an adult and probably knew some English, but had to learn, be here in the United States and learn all of the way that we do it here or whatever else. What type of obstacles did you have to deal with? I mean, there’s kind of a language barrier and whatnot. I mean, have you dealt with any kind of setbacks from not being English first language growing up here or has it been pretty smoother? Has that been some kind of advantage to you? I mean, you’ve got your culture where you grew up and it sounds like it was very thrifty, so you didn’t get into a lot of overhead. I mean, how has coming from another culture affected the way the business has grown?

Ali Moghaddam:
That’s a very, very, very good question. The very first important things to me was to learn English. I was working as a handyman, but I used to go to adult school. I never even missed one day at night I had to go. I was tired, but I never missed the school. The English is very important to learn how to speak English. And then after one year I was in California, I was be able to go to college. I assigned myself to the college and I study English. And then after that I study a small business management. It was a course in San Metro College, it called a small business management. I studied that it was kind of like an aa, and then yes, from the beginning I had a little problem, but I told myself three things. Somebody teach me three things. He said, when you came to United States, don’t forget three things. Number one, credit. Number two, your tax. Never work under the table because later on it’s going to hit you. You cannot get the benefit, you cannot get the loan. Number three. Number three is English. Learn English.

Ali Moghaddam:
I had a Persian folks in the classroom, when we go to the class, you want to sit next to me? I said, no, let’s talk to each other. On the break time, you go to the other side. We are here to learn English. That’s why I take it very important from the beginning. Yes, I lost a lot of opportunity to have fun for lucky. My wedding was 2004. On Saturday I took a day off on Friday afternoon, Saturday, Sunday, Monday, Tuesday I was at work. After my first child came, I went to the honeymoon and my wife was very understanding. That’s very important as well, because our business is not a joke. Our business is not an eight to five. My business is 24 7. Yeah,

Mark Lamberth:
Amazing. Yeah. So you’re married, you have two boys, is that correct?

Ali Moghaddam:
Yes. Two boys. Yes.

Mark Lamberth:
So you’ve had to juggle kind of family life, but it sounds like your wife’s been very understanding of the

Ali Moghaddam:
Work. Yeah, it’s very important. Very important to have a good team first at home, then you are free to do your business. Yeah, my wife helped me a lot as well.

Mark Lamberth:
That is awesome. How inspiring. Well, Ali, I’m just curious about how you’ve grown the business and what has worked over there. I know that word of mouth has been a huge piece of it. Are there any other ways that you’ve grown the business? You’ve got a website, you’ve done some advertising at all?

Ali Moghaddam:
Yeah. Actually the only advertising I have is my Instagram page and my website and word ’em out and obviously we put a sign. Each project we have, we put our sign there, but I think at one point we have to start getting the advertising to get the, right now I’m saturated. I want be projects. Don’t take me wrong. I built a 14,000 square foot house. I built a lot of interesting houses, but at one point I want to get to the bigger, bigger, what do you call concept, like a multifamily.

Mark Lamberth:
Oh, I see. Yes.

Ali Moghaddam:
When you get to that point, yes, definitely you need some more advertising and I’m thinking about it.

Mark Lamberth:
Okay, interesting. Great. And then regarding word of mouth, have you done anything to reach out to pass customers? I mean, have you pushed the sort of word of mouth at all? Sometimes folks reach back out every couple of months and say, Hey, would you be willing to refer us to someone else or has it been totally organic?

Ali Moghaddam:
It was organic. I make my customers so happy even if they are wrong at the end. I’m not a nickel and diamond and also, and I thinking about it, I want to pay $10,000 to that advertising company. Let’s take care of it. I have a current project. We had a signed contract. The lady was the owner of the new project. It happened to be in the same neighborhood that I just finished the house and she just want to see from outside. She was looking at it and the previous owner kindly come outside and said, can I help? You? Said no. We have a contract with Almo Construction now just for the look at outside of your project. She invite her inside, look at it, talk about me. This is the best thing. And our clients, as I said, I’m not the best contractor in the world just to let you know, and I cannot make everybody happy. But so far I think I made 99% of my client

Here’s another contractor doing good work in their business and community.

Mark Lamberth:
Happy. That sounds like a pretty good percentage there.

Ali Moghaddam:
Yeah,

Mark Lamberth:
I love it. Well, fantastic. So regarding the growth of your business, do you think that it sounds like you are looking to grow maybe 10, 20% per year over the next few years, or are you guys at the growth area that you want to be at right now?

Ali Moghaddam:
No, actually I want to grow more because I want to hire more people and I just want to stay back and focus on the more design and those kinds of stuff and development. I want to go to the development. That’s why I wanted my company to be automatic and hire that more educated people, the higher people, more managers, and then it become automatic even if I can’t have one week of the vacation time.

Mark Lamberth:
Gotcha. Well, fantastic. Well, you’ve shared some great information here about if a contractor wants to grow their business, what are some ideas? And one that you shared was just love what you do. So if you don’t love it, don’t get into it guys. If you’re not into countertops, don’t become a countertop expert.

Listen to our first podcast episode here, from Mark Lamberth at Rokket Science.com:
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Ali Moghaddam:
Exactly.

Mark Lamberth:
And then another was to reduce your overhead. So it sounds like you have got some great values around keeping your overhead low. What other ideas do you have? If someone is a contractor and they’re say mid six figures or high six figures, they’re trying to get to seven figures and beyond trying to get to multiple seven figures, what advice would you have for them about how to grow their contracting business?

Ali Moghaddam:
Okay, the first thing, don’t go and rent a big until like a three months ago, I had a 16 by 16 room office share conference room. We were paying only about a few, just a thousand dollars for the rent. Don’t make it too big of a deal. I don’t have office. My office was in my, is my home. Either my home or I’m sitting in my car and cut the check. Sometimes because our check is printable, maybe office print, but sometimes they need really need it. I tell them, okay, I’m in this job site. Just come there. I never go sit in the office unless I have a meeting or we have a biweekly meeting with our project managers, number two. Number two, they need to constantly working with find a good subcontractor and then tell them, Hey, we want to grow together some project. And I tell them, I really want to get this project. For example, if my foundation guy gave me $300,000 for that project, I said, you have to be on the two 60. You have to create a relationship with your subcontractors,

Ali Moghaddam:
The subcontractor understand it sub. You have to believe that subcontractor is one of the important aspect of your project. Why? Because number one, you have to make sure to have a relationship. Don’t keep getting the price from five different framer. Yes, for the first couple of jobs, do that. But when you choose your framer, sit down and talk, choose the good subcontractor and tell them, Hey, any job comes is yours and I’m going to trust you. You trust me, and then pay them on time. Don’t take the money yourself. I’ve seen the people, the first thing, they take it, my subcontractor, they tell me, for example, X general contractor, he always late on the payment, but he’s driving the Mercedes. He has a lot of dink. He’s always on the vacation. We go to his office, don’t do that. Your subcontractor, they’re very important to keep your costs down. Sometimes the subcontractor can lower it down. You get the job. Otherwise, if you want to keep going around and also don’t hire the cheap subcontractor because the cheap subcontractor at the end of the day is going to cost you more.

Ali Moghaddam:
I had the experience, somebody was $10,000 cheaper than the other guy, but at the end I had to spend another 15 to $20,000 to correct his job and delay. They have to understand every day for you and for the homeowner is clicking, the money is clicking the cost of the loan, the cost of this. These are the things that they have to be frame. And also they read the plan very well and they do the very detailed, very detailed contract. This way, there is no change order going on. There is no problem. And also, again, the first thing is to keep your overhead down. Don’t make it too much. You don’t want to keep up with Jones. Your company is your company. You don’t want to go get the a hundred thousand dollars truck that you are not using it. It’s been eight years. I don’t have a truck. I’m driving Tesla. I’m not taking any lumber, but I’m not going to go buy a hundred thousand dollars truck and just drive around to just see my truck. I mean, overhead down. Of course, you have to make money, but you have to be reasonable. Prove yourself to the community and your client and also the subcontractor. You really, really need to be involved with the subcontractor and talk to them and tell them, I want to grow my company. Then I’m growing. You’re going to grow with me too, but be faithful with your sub contactors.

Mark Lamberth:
Amazing, amazing. So guys, if you’re listening to this, I want to point out a few things here. Talking with Ali, who came from Iran 25 years ago, and he started as a handyman, okay. English was not his first language. He has had to deal with a lot more adversity than you have. That’s all there is to it, right? Got problems. We’ve all got problems. Okay. Ali has come here and I mean, is American fully part of this American country now? But 20 years ago he was not and he came over, learned all of this, went to school, didn’t miss a day, and I think one of the biggest lessons here that I’m hearing is, and I get the sense that you really kind of brought this from your culture originally was this frugality and keep the overhead low. Even when you start to have success that you have, don’t go buy a bunch of trucks, don’t get a huge office. Keep it low, and that’s going to be critical for your business as you grow it.

Ali Moghaddam:
Exactly.

Mark Lamberth:
Amazing. And also be super loyal with your contractors, with your subcontractor. I love that. After you do get some quotes and some bids in the earlier part of your career, determine who your people are and then grow with them. They’re going to have a 20 year career, you’ve got 20 years left. Go out and create relationships with those guys so that they have got loyalty, and you really create a cohesive company that’s moving ahead and not just piecemeal all the time.

Ali Moghaddam:
Exactly

Mark Lamberth:
That. Right. Okay. Fantastic. Well, Ali, this has been super helpful, super interesting. I love your story. I love the stunning work that you’re doing and glorious, I don’t even want to ask what the prices are on these houses, but they’re very high-end, 14,000 square foot house in the Bay area. Serious. Ali, if people want to get in touch with you, if they want to learn more about your business, if they want to talk to you, if they want a high-end project build, whether it be a house or multifamily, what are a few ways to get in touch with you?

Ali Moghaddam:
My Instagram page at Almo Construction, and then also they can reach out to our office. The phone number is (650) 610-9300. Those are the way to get reached to us.

Mark Lamberth:
Okay, perfect.

Ali Moghaddam:
Yeah.

Mark Lamberth:
Okay, guys. Well, if you need a custom construction in the Bay Area, you know who to reach out to. Ali, thank you so much for being on the show today. It’s been super informative

Ali Moghaddam:
And helpful. You are very, very welcome. You are very, very welcome. Thank you so much for having me. And I wish good luck to all the homeowners that are dealing the house and also all the new contractor, which we needed the welcome to our team and hope they have a very, very, very successful the business.

Mark Lamberth:
Fantastic. Great. We’ll end it there. Thank you for being here daily.

Ali Moghaddam:
Of course. Thank you so much for having me. Take care

This remodeler is growing his business with surprising takes from his experience in a completely different industry…Finance