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Reuben Saltzman

The Future Of Home Inspections (Michael Conrad II)

Michael Conrad II, the CEO of Diligent, a Home Inspection and Environmental Testing company in Nashville, joins the show to talk about how home inspections have evolved over the years.

The show starts off with Michael explaining how the company began, and how it grew into a trifecta of home inspections, energy auditing, and environmental testing. He shares about leadership development, the common care for employees, creating stability, and giving people the life that they want. He talks about his purpose which is to educate and help as many people that touch his sphere. He loves learning and helping people learn about how the business works. He also shares how the business is doing, especially during the pandemic, and digs into things he is working on for 2021.

Tessa shares a tool called the ACUMAX, by BERGflow, which offers some great training on how to build a business, hire, and how to onboard. She also discusses how ACUMAX is helping Structure Tech.

Reuben discusses hiring the right person, and how this is such a huge thing for the growth of a company. He also shares how he wanted to gush with everyone and tell them about the training he and Tessa went through this year with Pivot-Ready Teams.

TRANSCRIPTION 

The following is a transcription from an audio recording. Although the transcription is largely accurate, in some cases it may be slightly incomplete or contain minor inaccuracies due to inaudible passages or transcription errors.

Michael Conrad: I have learned, over the last handful of years in business, that I want to do everything, and I wanna be good and knowledgeable about everything, but I think we have to specialize, at least in the beginning.

Bill Oelrich: Welcome, everybody, you’re listening to Structure Talk, a Structure Tech presentation. My name is Bill Oelrich, alongside Reuben Saltzman and Tessa Murry. If any of you are paying attention, I did that backwards today. I usually lead with Tessa.

Tessa Murry: Do you? 

BO: And I also talk about this three-legged stool, and I ran across another podcast recently called The Roofer podcast. And the host, Dave Sullivan, uses this three-legged stool analogy for business. And I sent him a message on LinkedIn, I said, “I like yours better. I’m gonna stop using my three-legged stool analogy.” So, we are no longer a three-legged stool.

Reuben Saltzman: What are we? 

BO: We’re just three people living in the ether on a podcast. On today’s episode, we have a very special guest with us. Let’s introduce said person, Michael Conrad, coming to us live from Nashville, Tennessee.

TM: Hey, Michael.

RS: We don’t have applause, we needed an applause track. There, that was it.

BO: Awesome. That was fantastic.

TM: Reuben, Krisp app is blocking out all your applause noise that you just did.

[chuckle]

BO: So we can plug some…

RS: I forgot all about that. Oh, my goodness, that’s so embarrassing. That whole time, I was clapping and I just got done bragging to everybody on this podcast about this app I installed, and it blocks out background noise, and I was clapping furiously before the podcast and nobody could hear anything. So, here I am doing it, completely oblivious to the fact that it doesn’t work anymore.

TM: The app works really well.

RS: Huge plug for that app, right? 

TM: Yeah, yeah.

RS: Krisp.ai. All right. Back to our podcast guest. I stepped all over Michael. I’m sorry, Michael, welcome to the podcast.

BO: Yeah, let’s allow Michael to introduce himself. I’m really excited to be having a conversation with him. I think Michael is a leader in this industry. He’s active. Anytime there’s a multi-inspector forum or something, you’ll always see Michael in and around. I find his Facebook posts to be very fascinating, and so without further ado, Michael, please tell us all about yourself and your company. Start there.

MC: Thank you, guys, for having me on. Big fan of Structure Talk, big fan of Structure Tech, verging on fan girl amount of fanning over here or whatever it is, fangirling. I appreciate you saying that, Bill. I have learned, over the last handful of years in business, that I want to do everything, and I wanna be good and knowledgeable about everything, but I think we have to specialize, at least in the beginning. And so I have really tried to pour myself into a certain laser focus specialization around a couple of topics, and the passion and the interest and the curiosity really around business growth for a multi-home inspector company. I think it’s interesting, and so I just love talking about it. So, if you see me on the forums or you see me throwing a video up, it’s because I just like it. I just think it’s interesting.

BO: Very good. So, plug your YouTube channel right away, because you’ve got good content.

MC: Yeah. I put out some content on Facebook and on YouTube under the brand The Diligent Inspector, paying a little bit of homage to my company, which is called Diligent, in Nashville, Tennessee, not Diligent Home Inspections, although we do get tagged by realtors sometimes. I like to leave off the home inspection part and leave the mystery to percolate in their minds.

BO: What is Diligent? 

MC: Yeah. The Diligent Inspector is my attempt to put out into the world, hopefully driving the conversation deeper, I think that’s my ultimate goal, whether it’s a technical subject around maybe mold and fungal growth, or moisture and building science, or even stone veneer, which is an area that I have a lot of interest, or really just about business growth. How do you go from point A to point B? How do you become a large multi-inspector company and keep at it and keep growing? Is there a termination point that you’re trying to get to? Or is there really more methods that you just employ to maintain stable growth? Yeah, that’s where I’m pushing, and I always welcome the comments, the haters. All press is good press, in my book.

BO: That’s awesome. Tell us a little bit about your journey. When and why did you get into the home inspection world? 

MC: Yeah. Really it was kinda by accident, or maybe serendipity, shall we say. I came up in a construction family, out on the job site at age 8, driving a tractor around, backhoe. And so I knew and understood construction at a palpable level, at a physical level. And I was lucky that I came up under a father who was a do-everything contractor, he didn’t sub really anything out. And so I learned at the feet of my grandfather, who specialized in plumbing, and that one friend that specialized in electricity, and my father who just did everything else. When I made a big jump, I made a big leap from California, where I came up for the first almost 30 years, to the south, the buckle of the Bible Belt, Nashville, Tennessee. I said to myself… I had this sort of lofty goal, I said, “I’m going to leave the tool belt and enter the office.” That was my little mantra I said to myself.

MC: It was late 2008, and I don’t know if you remember that there was a big national thing going on back then, where really hard to find work and really hard to hold or keep and get a job. And so when I moved here, I fell into construction very naturally, it was the skill set I had. My father said, as long as I have a tool belt, I can always make money. And, well, I couldn’t do anything else, so there I was. But I wanted to get out and into something different, and so I sort of conned someone into giving me a job, an office job that was probably more of a secretarial role, but I thought of maybe more operations management. That’s what I called it, but I think I was a secretary, I’m not entirely sure. But there was not a lot of guidance, and so there was a lot of opportunity for self-learning. I spent a lot of days just teaching myself about the subject matter ahead of me, which was solar photovoltaic energy, the installation of solar panels and the management of a solar company.

MC: So, that was an interesting crash course. And I learned that if you’re gonna make energy, well, it’s probably a good idea to try to save it as well. Interestingly enough, blossoming in the middle of this solar panel business was this push for energy efficiency, air ceiling, insulation, blah, blah, blah, until I realized, “Oh my gosh, there’s a whole world of people that care about insulation and air ceiling and saving energy, and I didn’t know anything about it.” But it kept touching all of these little bits of knowledge I had from a background in construction. And so as I chased that little rabbit hole deeper and deeper, I found a whole world of energy auditors and green building designers and all these sorts of things, and it’s fascinating.

MC: And I met a guy, I met an interesting guy who was about 10 years older than me and successful in business, and bought and sold companies, and was an energy auditor and was trying to make his energy auditing business work. And he was finding moderate success, and he said, “Michael, I love your energy. You seem to know everyone, you seem to be able to talk to anyone, we should start a company together.” And I barely knew this guy, and I was like, “That sounds like a great idea. We should totally do that, total stranger.”

[chuckle]

BO: Nice.

MC: He said, “Okay, here’s the vision, I wanna do home inspections, energy auditing and environmental testing, and I want this to be just like trifecta. I want us to be a recession-proof business.” Because, of course, back then, I don’t know if you remember this, but the concept of recession-proof was very important to people. And so he’s like, “Recession-proof business.” And, of course, my natural very obvious first question was, “What’s a home inspection?” Believe it or not, I had spent all these years around construction and had never known or seen or observed or knew anyone who got a home inspection. In California, people don’t buy their homes until they’re like ghastly late in life, and so I just didn’t know anyone that had gone through it, I guess. Of course, I said, “What’s a home inspection/Let’s definitely do that.” And so we launched in. And if you know me, anyone out there, I take a heavy hand on branding and marketing. And so I jumped in, I rebranded the company, I built a website, I did all the basics, and that’s how Diligent was born.

MC: That’s how I accidentally got in. That gentleman is still a friend to this day, but he got out of the business after about a year because he couldn’t make it work for his life, and I was left holding this burgeoning new baby, and I said, “Well, I can either let it die or I can make it work.” And I made it work, and we’ve grown pretty well over the last eight years. We’ve been lucky, there’s been a good wave here in the mid-South area, and I feel like we’ve done a couple of things right.

BO: Tell me about the company as it stands today. How many inspectors… How many are you cranking out a year, what’s typical for national? 

MC: This is interesting. I was just thinking about a video that I had done about numbers of inspections versus revenue, parentheses, versus profit, I had to discuss this earlier this year. And this continues to be an interesting thing for me ’cause my mind evolves around how you define yourself and how you define your business. This little funny niche world of home inspections that we live in, for any listeners out there, we measure our success so differently than other people. Every industry does. But I find our metrics funny, ultimately. We just hired our 15th staff member, and we’re about to make a job offer to our 16th staff member, which is very exciting. Oh, thank you, Reuben, for the applause that no one can hear. I appreciate that. [laughter] We have… Depending on how you slice it, we have 11 guys in the field, plus myself, plus four staff in the office running support. However, we have taken a very wide angle approach to this business and have found that we can re-monetize customers, increase overall profitability, and conserve energy, as it were, by ensuring that we provide that one-stop-shop experience that’s becoming more or less the industry standard in the upper echelon.

RS: Totally.

MC: I guess, as far as numbers go, we’ll do somewhere around 2200 total inspections, depending on what you define as an inspection, this year. And I think we’re gonna just kiss the underside of 1.4 million in total revenue, which is exciting, but I will say it’s not nearly as exciting as spending a lot of years trying to reach a million in revenue. You sort of hit that and you’re like, “Oh, okay, I guess we’re here now. All right, onward.”

RS: Now what? What happened after you hit that, Michael? Was it a little bit kind of like, “What do I do next?” Did you feel it all rudderless after that happened? 

MC: Definitely. There was certainly a micro-existential crisis because there is a lot of information, coaches, conversation around getting to a million. Heck, even outside of this industry, if you look at any of the different entrepreneur organizations out there, the million dollars in gross revenue for a company is more or less a standard almost across industry. And so that was a big push. I spent a lot of energy focusing on how to increase profitability or increase ticket price and increase our overall volume to get there, and once we did, which was last year… We had just missed it the year before. Once we did, it was kind of like, “Okay, so money cannot be a driver for growth, there has to be something else.”

MC: And again, if you’re listening to podcasts about business growth, if you’re having conversations with other folks in this industry or outside who are in that top 1%, top 2%, 3%, they’re all having a very different conversation, and none of it is about money. All of it’s about leadership development or about that common care for your employees, and creating stability and giving people the life that they want. Or it’s about chasing new dreams and using your current platform to leverage or to incubate, which is, I think, more or less what I’m trying to do. And so, yeah, I think you have to really change what you’re looking at and also ask just success for success’ sake, or are we going in a noble direction, if you don’t mind me saying.

BO: Yeah. I like to think of it as purpose, my purpose in this world is hopefully to help others and amplify the good in the world. But, Michael, can you define your purpose? 

MC: It should have been a prep question you sent me.

[chuckle]

BO: It’s better when it’s not.

RS: Prep question, that sounds like a novel idea for a podcast, Bill. What if we sent prep questions? 

MC: Oh, isn’t that what people do? Don’t they send you prep questions beforehand? I would say my purpose is to educate and help as many people that touch my sphere. I would say that’s what I have come to see. I like learning and I like helping people learn, and I have seen that this business, the construction/real estate/design wing of the world, is rife with misinformation, with unscrupulous bad actors, and with opportunity for loss for the consumer, and heartache. And for fear of sounding overly romantic about it, I think that we can be mitigators of heartache and mitigators of loss and protectors of the consumer and, not often thought about, protectors of the home that oftentimes does not have an advocate for itself. And so, I think, at our best, we can play a “good defense is a good offense” sort of role out in the market.

TM: I love that.

BO: And I’m looking at this conversation and I’m thinking… Tess is in the building science world, and I know you have a big interest in the building science world, and Reuben has been here since home inspections were a thing, when they were first being dreamed up, and… I feel these home inspections, these conversations are leveling up really quickly. Right? We’re not just talking about… This is a thing within this ecosystem, and this thing causes that thing, that thing, that thing, and so that’s where you become that house advocate. And I’m fascinated by building science conversations, and it sounds like you were in on the building science thing early and the environmental testing thing early, so you came to this with a broad vision. How is that working out inside your company? 

MC: I have found that asking people to use the same mental connective tissue, and to read the same things, and to follow the same path, and to train in such a way where they can also become advocates for the home, that is a difficult process because, lo and behold, not everyone is like me, it turns out. And so this becomes difficult to replicate. In fact, you could have an entire podcast about the very real inertia in this business that is pushing back against replication and symmetry. That is the goal you have to have, that’s what I think you have to use to grow, but there is this unseen pushback against that, because people have different personalities, people come to you with different experience, each situation is unique out in the world.

MC: And so, Bill, your experience inspecting the very same home that Tessa would inspect, the very same home that Reuben would inspect, I hate to admit it, the dirty little secret of us who are trying to grow home inspection companies is, those end up being different. You sell it like they’re the same, and gosh darn it, you work hard to make them as close to the same as possible. But there are inevitable differences that are hard to get around that, on a good day, you’re just trying to shush those so that it’s not that apparent out there. But I would say that the conversation around training has changed a little bit for us, which I think is exciting. I think we’re trying to draw up the conversation in our own company and say, “Okay, the home inspection field falls back on this most basic driving force, observe and report. Observe and report.” It’s like serve and protect, it’s like the most basic driving force in our world. However, it is the most simpleton, one-dimensional, banal version of a home inspection, if you really get down to it. “There is a brown stain, it is on the west wall, moving on.”

MC: That is effectively what the minimum standards offer us, but it leaves the client wanting at a deep level, and the intellectual clients won’t want that, and it won’t help you grow. And so we’re moving towards this concept of, tell the story of the home, weave the narrative of what has happened in the past using the visual evidence apparent to you, and begin to use that same evidence to begin to tell predictive stories about what might happen in the future, that implications, that could-happen scenario. And that begins to connect to the humanity with a client and gets them out of thinking, “Oh, I gotta put on my technical hat and try to follow along with the inspector, which I will totally fail because I’m not a technical person, I’m just a regular consumer.” And so if you begin to try to create this storytelling concept and bring your humanity in, I think that it creates a lot greater lasting impressions, it helps you grow, but also genuinely helps people. Yeah, that’s maybe one of bigger differences that I’m pushing for, and I’m seeing also others doing the same work.

BO: It’s good stuff, because it is how a house performed with the last owner isn’t necessarily how it’s gonna perform under my supervision. It might be very, very different. So, if you don’t understand the story of the house, you might be disappointed when something pops up that wasn’t there before him. So, Reuben, is that existing inside of Structure Tech, like taking these conversations to a different level? 

RS: I don’t feel like we have the same focus, but we definitely think about the same thing. That really resonates with me, Michael, about how you’re saying that we’re trying to create the same experiences for everybody, but we know it’s not gonna happen. I mean, there’s gonna be differences in people, and that’s just… That’s been one of our big focuses, is, make it the same for everybody. And Bill, you just listened to a podcast and shared that with us the other day, I was just listening to it yesterday, about a plumbing company who’s trying to do the exact same thing. Why don’t you touch on that, Bill? 

BO: Well, they’re using live video feed on their technicians, sending it back to a truck that projects it out to the company so that they can get younger technicians in to do the job under the supervision of a more senior technician. And it allows the customer to see and understand everything they worked on. And I was… I’ve been talking, Reuben, like, “Well, maybe we could do some training with some body camp footage where it might not necessarily be live, but we can capture what we saw.” ‘Cause we run across weird things all the time, and you wish you had it documented, but you don’t, but that’s a lot of data to manage. And I love podcasts, I’m always listening to podcasts from other industries to see what we can steal and implement into our world, because there’s some great ideas, there’s people thinking outside the box all over the place, and it’s all customer-driven.

TM: I was just gonna add to that, too, with… We’ve been working on our training, too, I think you know that, Michael, just trying to figure out how to onboard people faster, more efficiently while maintaining that quality, that standard that we expect. And there’s so much more to it than just teaching someone the technical side of how a house is built, how a furnace works. There’s so much more to it than that. And really, like you said, customers, they are really at the mercy of what we’re telling them, what little knowledge they know to make one of the biggest decisions, financial decisions, of their lives that could impact them for a really long time.

TM: And so, one of the things with training that we’re really working on is trying to figure out how to teach someone how to understand the story of the house, like you’re talking about, and how to see the big picture and notice maybe where that house might fail in terms of a building performance perspective, ’cause that’s really huge, and that is a real challenge because, like you said, people are different, their experience and their knowledge base is different, what they see is going to be different, and then you’ve got different materials, different climates, different building processes that all… And different occupant behavior that all create these crazy variables. So, how do you teach that? It’s a challenge.

MC: Well, I’ll come out by saying, you described the complication well, but in my humble estimation, it is exponentially more complicated to define how to train well. Because there is this trend… And I think this is in a lot of businesses, but there’s a trend about creating boxes of information in our mind. Some people are good at keeping information separate in their mind, some people are good at keeping lots of information in their mind, and this business has an interesting demand upon us that we keep incredible amounts of information, volumes of information, in many, many categories. There’s very few of our related brethren or sistren in other related industries that have to keep this much knowledge. I’d say the GC is maybe one of the only ones, and we find that they fail us, a lot.

MC: But that’s actually not the complication. The complication is not in keeping volumes of information of boxes. It’s actually creating wormholes and connective tissue between the boxes, because if we cannot draw upon that esoteric bit of knowledge in this one box that helps us understand why these other issues are going wrong, then we may miss out on what is very obvious visual information, but it requires a second or even a third layer of analysis instead of that top layer, what I call, meta knowledge, which is sort of knowledge about knowledge. This is where most of the construction industry exists. Classically, you’ll have a plumber or an electrician or an HVAC guy come out, and he’s very good, he’s very efficient at going part A goes to part B goes to part C, and he can do it every day, and he knows exactly where it’s on the truck, he knows exactly how to put it in your house. But if you stop him and you say, “why does A go to B, and why does B go to C, and why can’t you just eliminate B altogether?” Much of that deeper understanding of why is not present.

MC: Therefore, we can learn something from that as home inspectors, anyone who’s listening, that is to say, push yourself to understand not just the what but also the why. Don’t just fill your individual boxes with greater amounts of information, but build inroads and synapses between them so that you can draw that together. In a lot of ways, that’s one of my core competencies, and I’ve been trying to train that and it’s extremely difficult. And I’m so thankful that I have a chief inspector, named Richard, shout-out, who basically does an incredible amount of the heavy lifting of training, because he is allowed by the function in this business to focus on that, and he builds beautiful little emails and scripts and concepts, and lacing it with humor so that we can build these synapses and inroads together between the knowledge.

TM: I love that, Michael, and I think you just hit the nail on the head. A lot of the people that get into this industry or enjoy doing home inspections are people that are really good at seeing the close-up picture, the detail-oriented people, but to do what you just said, take someone who’s also able to take a step back and put all the pieces together and think in a different way. And that… It’s a conundrum.

MC: And for the Bills or for the Reubens in the room, how do you identify those people during hiring? Because that’s the latest conundrum, not just how do I teach someone to do it, but how do I better my stead by trying to hire the right person who is able to do that? 

RS: I don’t know if you knew, Michael, but Tessa is no longer a home inspector on our team. She is now the recruiting, hiring, and training manager at Structure Tech. That’s all she does full-time now.

BO: I was gonna answer by saying, you do what Jim Collins says and you put the right people in the right seats on the bus. And Tessa is the right person in the right seat, and she has taken all that burden away. And we have some fancy tools that we use.

RS: Well, Tessa, tell him what we’re doing.

TM: Yeah. So, there’s this really, like Bill said, fancy tool. We use this kind of behavioral assessment. Can I say the name of it? 

RS: Of course, please do. Say who does it and all that, BERGflow and IEB.

TM: Yeah. Shout-out to BERGflow, Dirk van Reenen, his company. They offer some great training on how to build your business, hire, and how to onboard. And they introduced us to a tool called the AcuMax, and it’s this kind of behavioral assessment. But that has been a really helpful tool in understanding how someone naturally likes to think about things and process things. And it gives me this view of, are they someone who’s a lot more detail-oriented and likes to take in as much data as possible, and have a black-and-white answer, and understand the structure and the rules of things? Or does this person like to jump around, and they like the big picture view? And they don’t need all those rules, they’ll figure it out as they go, and so that tool’s been really helpful. But like I said before, the conundrum is, the people in our team who are really happy inspecting and who enjoy doing this long term are the people who are more detail-oriented, who like the zoom-in approach. And like you said, I feel like this industry is moving in the direction where we need to be able to put those pieces together and see the big picture.

TM: And so there’s a balance between that, and I haven’t cracked the code on that yet. All I can say is, when I’m interviewing them, I’m asking them questions, painting the picture of different scenarios and thinking, trying to dig a little bit deeper into, are they capable of seeing the big picture. When have they done that in the past, in their previous careers? And can they incorporate that into this? It’s a challenge. There’s some really smart people out there. I’m thinking of the engineering brain, that detail-oriented, can analyze things, like the clear black-and-white answer. And on the surface, they’d be a great home inspector. But getting down into it, are they able to take a step back, look at the big picture, not have a clear black or white answer, and be okay and comfortable with that perspective and that reasoning? And I think that’s really uncomfortable for people like that.

BO: So, do we blend the two, Tessa? Do we take these very, very detail people who are great at finding all of the facts, and then hand the facts over to a storyteller who can weave this narrative? 

TM: I’m trying to find people who are naturally able to focus on the details and not get dragged down by the details, but they’re also flexible enough to weave that story together. And they enjoy the challenge of looking at the big picture and going a little bit deeper and asking the “why” question.

RS: And I gotta touch on this, Tessa. I gotta just wax on this for a couple of minutes here, just to talk about how cool this tool is that we’re using right now, because I keep stepping back just a little bit, little bit, little bit, to give the whole story here. We’ve talked about this on the podcast, we’re members of this group called IEB, Inspector Empire Builder. I’m a huge fan, I’m a groupie of that organization, so much so that I volunteered to be an ambassador for the group. And I didn’t know what that meant. I’m just like, “Yeah, ambassador sounds good. I wanna give back, I’ll help out.” And it’s a matter of calling about, I don’t know, somewhere around 40 members per quarter. This is a lot of phone calls, and each phone call is about 20 minutes or so. And it’s a lot of discussion, just, “Hey, how you doing?” They’re all home inspectors, and it’s just, “How you doing? How’s your business going? What are you working on for 2021?” And what I hear repeated over and over again is, “I’m having a hard time hiring people. I’m having a hard time finding people. I’ve made bad hires, I’ve lost a couple of people this year.”

RS: And the person thing that, the employment thing is so huge to the growth of a company, and I wanna gush with all of these people and tell them about the training that we went through this year about pivot-ready teams, because that completely changed the way that we hire people. My biggest takeaway from that training was that we can’t be looking for one person, and then sit down and have a long interview with them. We need to be looking for 50 people for one position, and we need to have a huge funnel to put all these 50 people in there, and filter and filter and filter, and get it down to having maybe phone calls with 10 of them. And these are the quick five-minute phone calls, and then maybe doing some longer one-hour interviews with three of them, and really narrowing it down. And this is totally changed our hiring process.

RS: It is so important that that’s why we moved you to your existing position, just because I realize how much time this takes. Aand I’m willing to pull you a full-time home inspector off the schedule, a producing person, pull you off the schedule and just pay you to do this instead, because the cost of a bad hire is so astronomical. And what I’m getting at here is that it changed our hiring process, but also this is a world class training program. There’s another person I know who’s basically, they’re a recruiting company, they’re a head hunter, and their hiring process is strikingly similar to the same process that we use internally at a small business. It’s crazy how powerful this tool is, with just filtering people down, getting to know them before we’ve actually even met. And we have it right on our website, we have an employment page. You click on Employment, and then if you wanna get a job here, it’s like, first step, all right, take our AcuMax assessment, here’s a link, and people can go take this. I don’t wanna speak for you too much, Tessa, but you put a lot of weight in those results, right? 

TM: It really does help me know ahead of time before I talk to the person if they will be in alignment with what this job requires of them, and if they will be happy long-term doing it. Now, it’s not to say that if they are not a certain AcuMax behavioral pattern that they’re eliminated, that’s not the case, because as I’ve also learned, Reuben, we’re not just looking for the home inspector, we’re looking for someone who can help this company grow. And there’s lots of different ways that we will be growing and are growing that require different skills and different personality types.

MC: Okay. So, confession, we accidentally organically figure this out regarding office administration staff failures, and the loss was cripplingly financially painful. We had to alter our strategy to be much more funnel-oriented, and it has made a huge impact. And we’ve had a huge success in retention and good people working. Full confession, I am not employing this on the inspecting side. Those who know me know that I rely heavily on Lady Luck. She and I are like this. [chuckle] And I use serendipity and luck way too much in my life for both personal and professional, and so sometimes I’m just rolling the dice on the constant. And so I have benefited from having a very visible brand. People come to us, however, not in a deluge of people that I can funnel down and whittle down. No. It’s me still making laser snap judgments, of which I’m not entirely sure I have a great success rate on. I have good retention only because through sheer white-knuckling force of will we have shoehorn people into a mold, and then smash them a little deeper in molds, and they fit the mold. And if a little dough gets out, then it just gets out.

MC: And so it’s worked, but in this industry, I’ve talked with you, Reuben, and maybe both of you guys as well, but others certainly there are gears, there are tears. And when you reach the ceiling of a lower gear, it’s like when your RPMs are revving and you need to drop it down a gear, or drop it up a gear, or whatever. I sense that we have been in a really great low RPM, high fuel efficiency gear for the last couple of years or whatever, and I’m starting to bump up against needing to make big alterations and business practice and business theory and philosophy of operation so that we can reach upper echelons. And you have to remain humble, you have to remain humbleness. Whether you are the recruiter or the owner or the inspector, humility is a hugely required component to this industry, in this business. You can be measured as successful by many people’s standards by a large percentage, but you can be measured as not as successful by other people, so there’s always someone on the left and always on the right of you. And so humility helps keep us focused in the right direction. But, yeah, this is an area where we have enacted our will more than we have sought the right people, and Lady Luck has smiled upon us often, and that is totally unsustainable.

RS: Well, you do deserve it, Michael, I will say that.

MC: Very kind.

BO: I have so many more questions, Michael. I think this could go on for several more hours if we really, really wanted to. I wanted to pick your brain on mold, because you grab mold and you made it a big part of your business. Tell me a little bit about your mold business. I don’t wanna cut this up, because I think it’s really important, the educational piece you provide your clients beyond just taking a sample.

MC: Yeah. I’ll tell you what, if you’re interested, maybe you can have me back for another time, and I can go a little bit deeper into this very deep rabbit hole, very dark rabbit hole of mold in the home inspection list. But I’ll give you a taste of it. Initially, this was just another service on a small short list of services that I thought was a necessary thing to do on a home inspection business. Maybe not wholly, unlike folks that are getting started. You’re bombarded with, “Do a home inspection, add this, add this, add this.” And depending on what part of the country, depending on what vendor you’ve spoken to, “Mold testing is seen as a very approachable and very logical next step.” My journey maybe has been your journey, and certainly many of the folks who’ve spoken to those vendors at those conferences, and have bought into it.

MC: You get in, you think you start to figure it out, you start to get some confidence, and you think you’re getting momentum, but what you realize is that you’re sand-bagging a lot of questions, for anyone that’s a spades player out there, and your questions lead to long-term doubts. And then one point in your business, you’re gonna bump up against a situation or a couple of situations where it’s going to cause some serious ethical doubt in your mind of whether you’re offering something that you can plausibly stand behind or that you can plausibly explain. And if you’re not asking those questions about mold, let me just say, you should be because it should be causing you to dive deeper in your information. And if you’re not doing that, then maybe you’re not doing a full service to your clients. So, yeah, my journey was, start doing it, make it up as you go along, learn a little bit, and then completely lose faith in yourself and faith in the service, and then totally just get out and say, “Screw that, I’m out, the mold testing side of it.” So, that was my first couple of years, and I totally swore off of it.

[laughter]

BO: Are you back in the mold game? 

MC: Yeah, yeah. I quickly learned, these sort of roller coaster journeys, that there was a need for it. The market was asking, whether they were asking implicitly because questions were arising that I knew were questions, even if the client didn’t, or whether they were literally asking for this service, the market was asking. And so I tentatively waded back in the water, and I decided to go a bunch of different directions and play the field, and see what technology was out there, what people were out there, and I started to educate myself. Now, I had a slightly potentially just easier time acquiring some of this knowledge because I had a science interest as a younger person. I thought about becoming a chemical engineer at one point in time, I loved chemistry, and I found all of that interesting. I job shadowed a chemical engineer once, and they seemed boring, boring people. And so I was like, “I can’t do that.”

MC: I studied theater instead of chemical engineering, obviously, in college, and so that’s how I got here. So, as I started to ask the questions and went to the wonderful world of the internet to seek more information, I knew I had to squint my eyes. I had to read 10 articles to learn one thing, I had to use what I call consensus opinion, which I think is an important part of this business, and that is ask 10 experts. If six of them or eight of them agree on one thing, the statistical likelihood that that’s true is really high. Consensus opinion helps you keep your compass bearing north.

MC: And so I began to follow people, I began to boldly call people on the phone who didn’t know me and be like, “Hi, I’m curious about this stuff.” And, of course, most of them were weird esoteric researchers, and they were like, “Oh, my gosh, someone’s calling me. This is great.” I actually got a lot of great conversations, went to little classes here and there, and started to realize that to understand mold testing, this sort of simplistic button-pushing service, I had to start drawing in areas of biology and fungal mycology, which is the growth of mold. I had to start drawing in areas of moisture movement, moisture dynamics, and building science, the wall assembling. I had to start being able to weave together occupant habits, environmental circumstance that might occur in a home, whether it’s occupant-driven or environmentally driven. And I had to start looking at a lot of tangential subjects to clarify this centerpiece, and that actually, for many, might be frustrating, to learn 10 things, to only learn one. It seems like the long circuitous way around.

MC: But, I don’t know, I was just nerdy curious. And I hope that for everyone, that you can find that nerdy interest and run it down. But mold began to be a quest to understand really mold-causing circumstance. And that’s a phrase I use commonly, and I have really come to see both in talking and teaching to home inspectors, as well as speaking to clients, that mold-causing circumstance is 10 times more important than the physical, biological fungal substance itself.

BO: Michael, is a home predisposed to growing mold, or is it almost entirely based on occupant behavior? And have you ever looked at a home that wasn’t fully dehumidified, dried out before they put all the insulation and the vapor barriers up, and all that other stuff as an underlying cause of mold? 

MC: Right. I would say that the vast majority of those of us that live in a micro-climate that gets rain, snow, has humidity, has ground water, has localized bodies of water, most of us are going to live in an ecosystem that’s predisposed to mold growth. Mold, and really the whole fungal family, is a hugely important part of the grander ecosystem of breaking things down, and we live in their world, not the other way around.

BO: I like that.

MC: And I would say that our habits are those of water-oriented habits. We need water to drink, we need water to shower, we need water to cook, we need water to go to the bathroom. Water exists in a very human history awkward sort of sense. Water exists in our homes in a way that it hasn’t for thousands of years, now it does. And we now say, “No, Mother Nature, you cannot have your way with the weather patterns. We will tell you what the weather will be inside of our homes.” And so we forcibly create even further micro climates inside of our homes. And we ask our building components and our building systems to, “Stay with us, stay with us here.” And that’s hard because there is rife with opportunity for failure. Spill my water jug, break my plumbing pipe, accidentally leave my window open in a humid day, there’s many, many, many occupant and non-occupant sources for water entry into the living environment.

MC: And I would say California, from whence I came, not a huge water place, a lot of fires. Tennessee, Nashville, Tennessee, the Cumberland Valley, yeah, we’ve got water coming up from the ground, cause bedrock with lots of groundwater. We’ve got water coming down from the sky with just a lot of rainfall. And we’ve got water just permeating to the air, we got lots of humidity. So, Mother Nature has three weapons that she is trying to win this war, and she is most often successful in this part of the country. And so every house has mold. That may not be true in the arid desert, New Mexico, Arizona. That may not be true in the High Plains of Montana, North Dakota, but that is true in a mixed humid climate. I could go down a deep rabbit trail on the mixed humid climate and really climate zone four as a dangerously difficult building climate. I’d almost prefer to be in a seven or eight, or a two or a three, rather than climate zone four, because you’re fighting two battles on two fronts, instead of just traditionally a single battle.

TM: Yeah. Even in five and six, we get in the summer, super humid days in the 90s, and in the winter minus 20 and really dry. So, where do you put the vapor barrier? On the warm side of the wall for the summertime or for the wintertime? 

[chuckle]

MC: So glad you brought that up, Tessa. I was hoping we were going to get to IRC Section 7 or whatever it is. The vapor barrier in the North, oh, boy, I got some opinions about that. Now, as a southerner, I gotta say them with respect and deference, but, man, a vapor barrier in the inside, any time we are trapping moisture in any direction, it’s a dangerous gambit. And the code, interestingly enough, for all of what I have learned the deeper I’ve gotten the code, all of its folly, the code allows a simple solution for all the Northern builders. It allows for a Class II vapor retarder instead of a Class I vapor retarder, it says an or. And the Class II vapor retarder is your kraft facing on a batt insulation, which is more than sufficient to both be water diffuser and also water preventer, you might say. And so, yes, that is a thing we don’t have to deal with. And once in a blue moon, we’ll see a vapor barrier inside the wall assembly, and we’ll all just shake our head disparagingly.

[laughter]

BO: You have now taken this conversation to an entirely different level. And climate zones, I get it, for all the landscapers out there. I’m not a landscaper, but I know that there are certain plants that don’t go in certain places.

RS: Moonlighting as a landscaper? 

BO: Yeah, exactly.

MC: Mold is the result of… And this is sort of a harsh comment, it’s the lack of forethought effectively, because it’s going to occur if you haven’t thought enough building chess moves ahead, if you haven’t pre-planned it in the design phase, if you haven’t managed it during the construction phase, if you haven’t been knowledgeable of it during the occupant phase. It’s an inevitability, effectively.

TM: I love what you just said, Michael. It’s so true. It’s not the result of one thing, it’s all these pieces coming together. The pre-thought, the building, the planning, the construction, the occupant behavior, all of it. That’s building science. Yes, building science.

[laughter]

RS: Meanwhile, I’m here thinking about The Queen’s Gambit. [laughter] I love that chess is now popular again, talk about nerdy…

MC: Yeah. But mold causes… I think home inspector is a great set of questions. And on the whole, what I see is people like the money, and they don’t like to have to do the learning. It’s just a huge amount of information. And so not wholly unlike building science, not wholly unlike stucco, eaves, or stone veneer, mold requires a decision point, a fork in the road. As home inspectors or as a company owner, you have to decide which side of the line you’re gonna fall on. Are you going to be a knowledgeable yet referring party, where you have a partner that you refer things to? Or are you going to take this into your business and slowly become a local expert? Because you cannot sit tepidly in the middle. It really will hurt your brand long term. It’ll hurt your head short term.

TM: That’s a fascinating perspective, Michael. Yeah. Wow.

BO: Well, I’m gonna jump in here, and let’s put a wrap on this episode. Michael, I so enjoy conversations with you because you have a command of the English language that I love, and I think you’re fascinating. I appreciate the fact that you’re a leader in this community. You’re pushing people to the ends of their limits of thinking, and I think that’s a good thing. So, thank you very much for giving us the time. This is being recorded just before Christmas, so I wanna extend my wishes for happy holidays and a merry Christmas. You too, Reuben and Tess, mostly Michael. We don’t have access to him as much as I have access to you and Reuben. But thank you again, Michael. Why don’t you go ahead and plug yourself, your YouTube channel, your website, all that good stuff? 

MC: Thank you, guys, again. I’m hoping that if you’re hearing this podcast, you’ll take a quick minute and head over to the YouTube or the Facebook, and look me up at The DILIGENT Inspector, and I hope that you’ll join the conversation. I love answering questions or even snarky comments, and I love trying to take a simple concept and dive deeper, so join me there.

BO: Awesome. Thank you, Michael. You’ve been listening to Structure Talk, a Structure Tech presentation. My name is Bill Oelrich, alongside Tessa Murry and Reuben Saltzman, and we will catch you next time. Thanks for listening, everyone.

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