In 2018, Kyle Peter’s pool service company had 12 recurring customers. By 2023, it had 600. Today, Nevergreen Pools services 1,300 pools a month. You could say that Kyle knows a thing or two about breaking through growth barriers.
He recently stopped by the Between Two Stops podcast to chat with our host Niki Acosta about all things growth: how he’s done it, what he’s learned along the way, and how he’s planning for the future.
Lesson #1: You have to spend money to see returns
Most companies stagnate because they get stuck at a certain point along their growth trajectory. Over his years in the industry, Kyle has seen lots of companies cap out at 400-500 pools, and even fewer make it to the 600-900 pool range. Fewer still get to more than 1,000 pools. As Kyle sees it, there’s a good reason for that: pushing through each of these stages is difficult work that requires a financial investment.
In Kyle’s experience, the 500-pool mark is typically where you need to bring in another layer of management. This, of course, introduces an overhead cost. “If that’s not budgeted in,” he says, “It will take all your profit.” However, that profit usually comes back once you get to 600+ pools.
Once a company reaches the 800-900 pool mark, another hurdle is introduced: “You need to build out customer service or district service managers,” says Kyle. That means, you guessed it, another overhead cost. Nevergreen recently went through this, and is now starting to see profits come back up at 1,300 pools.
“What I learned is, you need to spend the money before you get the returns,” says Kyle. He’s always relied on data to help him decide when to make investments. “Now,” he says, “We have seven years of data we can look back on to make plans for the future.” The key is to constantly be planning and supporting growth. Otherwise, says Kyle, “Churn will be too high and growth will stagnate.”
Lesson #2: Hire help to complement your own skill set
Hiring staff is a big—and often scary—step for many pool service business owners. Kyle’s advice? Hire for the things you can’t do. For example, “Business-minded folks might want to hire someone more technical.”
That’s exactly how Kyle approached hiring in the early days of Nevergreen. Since he came from a more corporate, systems-based background, he hired a technician so that he could spend more time diving deeper into admin work. That strategy has served him well over the years.
Today, Kyle still stays focused on the systems and processes side of the business, while letting others take the lead on “creative, out-of-the-box” style thinking. He spends his time where it’s most impactful: documenting processes and setting up playbooks that can allow the team to scale with the right information.
As he sees it, no topic is too small for systematization. Kyle has even created a diagram of how the trucks should be stocked at Nevergreen. “The more you can simplify tasks, the more repeatable they are,” he says. “Putting down on paper the things that you do well but need help with is important.”
Lesson #3: Good marketing will always give you a leg up
Most people start their own company because they’re “doers”, but that doesn’t mean you have to do everything all the time. “The first time we ran Google Ads, we hired an agency,” says Kyle. “I recommend that. It’s worth its weight in gold.”
The key is to monitor how much you’re spending—and how many leads that spend gets you.
“We spend on marketing,” says Kyle, “But we know what’s coming out the other side.” And no matter how much you’re spending on marketing, you might as well be throwing it out the window if you’re not picking up the phone. “If someone calls you,” says Kyle, “They’re actively shopping. Speed to lead.”
As much as a set-and-forget strategy would be great, you do need to stay on top of your online presence if you want to be featured at the top of Google lists. There are four areas in Google’s ad services:
- Local services ads, which are a blend of pay to play and your rankings from recent reviews.
- Pay per click, which costs money to compete within.
- Google Maps, which requires great local SEO.
- SEO, which is a commitment over time.
As Kyle sees it, all four of these areas are important to continue to improve upon. “We try to be everywhere,” he says. SEO takes time to get traction, but it’s paid off for Nevergreen. “It used to be that you couldn’t find us on Google,” he says. Today, they’re a top result thanks to their continued SEO efforts.
Lesson #4 Route acquisition works (except for when it doesn’t)
Many people think of route acquisition when they think about growing a pool service company. And sometimes, Kyle does too. “I kind of go up and down on acquisitions, marketing spend, and ways to grow,” he says.
Like any growth method, acquiring routes comes with its own benefits and drawbacks. A main benefit: it’s a quick way to grow. Because of seasonality, the window within which a company can grow is tight. “I like to purchase routes in the fall and spring,” says Kyle, so he can start a new season with a larger set of clients.
One drawback? Acquiring routes is expensive. Customer acquisition cost (CAC) is much higher, says Kyle, at 12x the monthly revenue if you’re buying from a broker. Another drawback: the outcome can be hit or miss. “We’ve done 10 acquisitions with varying success,” says Kyle.
Ultimately, the decision to acquire routes is a personal one, and it will always carry a certain degree of risk. “Of course, the best way to grow is through referrals,” says Kyle.
Lesson #5: Getting customers on autopay is a game-changer
No matter what stage of growth your company is navigating, nobody wants to be chasing down late payments. That’s why Nevergreen now requires its recurring customers to have a credit card on file (which works out to 90% of its customer base).
This simple change has directly and positively impacted Nevergreen’s cash flow, which means the money Kyle needs to grow the business is there when he needs it.
Growth is hard, but always worth it
Kyle’s closing advice for pool service owners contemplating growth is simple: Yes, it’s hard. But pushing through is worth it. ”Some of the darkest days I’ve had growing the company feel like badges of honor now,” he says, and he has a thriving business to prove that it’s all paid off.
Don’t forget to catch the full conversation with Kyle below.
