Episode 5: Working to a Shared Vision, with Morty Hodge
Morty Hodge is the Founder and CEO of Atlanta Compressor, a company that sells, installs and services industrial-sized compressed-air systems. Morty started his business in 2010 in Atlanta and has since become a true expert in growing his business to the next level, opening new locations in Nashville (Nashville Compressor), Charlotte (Charlotte Compressor), and, most recently in Detroit (Detroit Compressor). Morty’s company consists of nearly thirty team members across all four locations, and by the end of the year, Morty anticipates that his business will do more than $6 million in revenue.
What the podcast will teach you:
- How Morty moved beyond the early “caveman-era” of his business after reaching the multi-year plateau of $1 million in revenue
- Why Morty himself became the bottleneck of his business, and why he realized that having everything filter through him was holding the company back
- Why his brother-in-law’s suggestion that Morty read “The E-Myth” by Michael E. Gerber changed his outlook on leadership
- What steps Morty took to stop micromanaging the business, hire the right team members, and grow his revenue beyond the $1 million plateau
- Why setting and adhering to a company Vision was a critical step, and how Morty brought in the entire team to develop that Vision
- Why “providing peace of mind” has been a unifying purpose for Morty and his team, and how they reflect that Purpose every day
- Why defining their Purpose, Values, and Mission, setting clear goals, and hiring “talent rockstars” helped the company break through the $1 million revenue ceiling
- Why the company’s Vision and culture allowed Morty and his team to attract top industry talent
- Why leadership development was a key component allowing the company to grow to the next level
- Why the business created a company Audible account to give everyone in the company an opportunity to access personal growth resources
- Website: www.atlantaaircompressor.com
- Website: www.nashvillecompressor.com
- Website: www.charlottecompressor.com
- Website: www.detroitcompressor.com
- LinkedIn: www.linkedin.com/in/mortyhodge
- The E-Myth Revisited by Michael E. Gerber: https://amzn.to/2pn1rin
- Good to Great by Jim Collins: https://amzn.to/2IPC3bN
I’m excited to introduce to you a special guest. He is somebody that I’ve known now for a few years. His name is Morty Hodge. He is the Founder and CEO of Atlanta Compressor and a down-to-earth guy. You are going to be glad that you read Morty’s story and the lessons that he learned as he grew his business from $1 million in revenue to the point where he is now. I’ll let him talk more about that as we go along through the interview. Let me bring on Morty. Thank you for joining us.
Thank you, Brett, for having me. I’m excited to be here and join your audience.
What I’d like to do briefly is have you tell us a little bit about your business. I want everybody to hear. This is not an author, speaker or small business guru. This is one of those real business owners who have learned some real business lessons. I’m excited to share some of those in this episode. Please tell everybody about your business, what you do, where you guys are located or maybe the size of your team. Just give us a little feel for your business.
Atlantic Compressor, a version of it, started back in 2010. Currently, we have 27 team members and four branches. One in Atlanta, Nashville and Charlotte and we just launched Detroit Compressor. We have 27 members and about $6 million in revenue.
You started the business in 2010 and a few years later, you’re up to almost 30 employees and $6 million in revenue with four locations. That’s pretty impressive. We liked the success stories, but let’s back up and let’s rewind to when I first met you. Tell me about where you were in revenue. You had one location at the time, Atlantic Compressor. This is 2000. You can go back to ’13, ’14 or wherever you think is important. Take us back to where you were many years ago and what was going on in your business.
In the early days, in 2010, I call it the caveman era. It was dudes in trucks riding around. We sell and service industrial equipment. Our customers are manufacturing companies, medical hospitals, laboratories and universities, anything with compressed air vacuum systems that they use in their process. We’ll sell the equipment and then we’ll service it.
Back then, we were just technicians riding around in service trucks and we didn’t understand the concept of how to run a business. We were good at what we did. In 2013, we got to about $1 million in revenue. I think most business owners realize or they think, “I’m doing good. If I hire somebody else as the business grows, we can double our income or our revenue.” That’s not always the case. That’s a pretty big struggle, but we started to hire people.
We started to turn into a company in 2013. It took us about three years and we got to that $1 million mark and we plateaued right there through 2015. Back in 2013 and ’14, we did about $1 million. In 2015 going into it, it was a struggle. Halfway through the year, it didn’t even look like we were going to even reach $1 million. During that time, we realized we had something good, but we didn’t understand what the issues were. We didn’t even know what the problems were. We didn’t know what we didn’t know. We were desperate for help.
You had a great start in the caveman era. Guys in trucks and you’re out there selling, installing and servicing industrial compressed air systems. You’ve made it $1 million and then you flattened out. For the next few years, ’13, ’14 and ’15, the first half of ’15 didn’t look so good, but you ended the year a little North of $1 million. You didn’t know how to put words to it then, but looking back, what were some of the pains that you were experiencing at that time when you were tapped out right at $1 million?
The number one problem was everything needed the funnel through me in order to get to $1 million and then I became the problem. I became the bottleneck. We were coursing all decisions to go through me. All of the sales, all of the services, all of the phone calls and all of the invoices, coursing all of that to go through me and having my hands in everything, the work piled up. Everything was late or past due. Customers were getting frustrated with us. We had grown to a great size, but I became the bottleneck. I couldn’t facilitate the work quickly enough to take care of our customers and our team members.
We had up to about 8, 9, and 10 team members at that time and we didn’t have any structure. There are no systems and processes in place. We barely had policies, handbooks and things like that. We were even up to that point, flying by the seat of our pants, doing a really good job of trying to take care of our customers. In 2015, where we started to struggle when customers felt the same frustrations we did.
I wish there were some way for me to reach through the audio and grab our readers by the shirt, shake them a little bit and say, “Are you paying attention to this?” because this happens and there are countless versions of this same story out there. In small business growth, people get through stages 1, 2 and 3. They hit stage four and for your context, Morty, in our first episode, I reviewed the stages of small business success in an interview with Clate Mask.
We went through all the stages and what you’re describing is a classic thing that happens when you go from steady operation in stage 3 to now we’ve got this million-dollar seven-figure business and you sort of hit this invisible ceiling. You described it perfectly when you said, “I became the bottleneck.” You could only handle, at that point, the business up to that point. There’s no going forward until you figure out some things that you didn’t know before. As a seven-figure CEO, what did you learn that enabled you to have a breakthrough? This show is all about helping our readers, seven-figure business owners, have a breakthrough when they begin to get stuck.
The first breakthrough that I had was that my brother-in-law Kyle Rubis had been suggesting to me for probably a year to read this book called The E-Myth by Michael Gerber. I wasn’t a reader. I barely read in high school. A little bit in college, but I’m just not a reader. Finally, I read the book and I almost got emotional about it because it started to address my problems and helped me start to figure out, “There are answers out there.”
The first solution was personal growth and me getting committed to growing myself, my skillset and learning different lessons. Once I read that book, I started to consume and look for opportunities for personal growth and leadership development to start to develop the skill set that I needed in order to run a company.
What a gift from Kyle to get you to turn on to a book that changed everything for you. I would highly recommend it to those who haven’t read, The E-Myth by Michael Gerber. It’s a fantastic book. We read it in our own version of this story in our company at Infusionsoft as we were growing. That was a key relationship that we had with Michael Gerber back then as well.
You said that book was important and for those who haven’t heard it or listened to it or read it, let’s give the cliff notes version. That book is all about understanding the different roles in leading a business. You were a technician and you needed to move into being a manager or an entrepreneur. Those are three hats that a lot of founders and CEOs wear. You had to be aware of those different hats and start systematizing your business so that it could grow outside of you. That’s a great tip. As you began your personal growth journey, what did you learn that helped you take the next steps after that? What did you do to move the revenue forward?
In order to move the revenue forward, I realized that I had to get out of my business and start working on my business. I couldn’t force all of the decisions to go through me. I couldn’t be involved in every aspect of the business. I had to start to pick and choose and trust people. I then began this whole process of, “Do I even have the right people on the bus?” The answer was no. Once we started to realize, “We’ve got to get the right people on the team and start to pick and choose based on native genius, so who’s good at what and what am I comfortable giving up to other people on the team?”Leaders creating their own cultures and visions are needed for a business to grow to the next level. Click To Tweet
That’s a very short snapshot of a sentence, but the truth is that it was a long process of starting to develop things. We then started to realize that what we needed was a vision. We needed to put down on paper who we are and what we are doing here. How are we going to go about doing this? Why are we doing this? Once we started to develop those things and put a vision on paper for ourselves to describe who we were, it helped us weed out the wrong people and then help us get the right people on the bus. From there, it was the hiring process. How do we hire people at that time? Anybody looking for a job that we could afford we were hiring and training and that wasn’t the right way to go about it.
You just had a bunch of things in there, Morty. Let’s pick that apart a little bit and tease out the lessons for our readers. Once you got clear about it, “I need to spend time working on the business and then we need to make sure we have the right people on the bus.” That’s a Jim Collins idea. Michael Gerber working on the business and Jim Collins is the right people on the bus, but then you talked about an important thing that I want to draw. You said we needed to do some vision work.
I want to take a few minutes on this because vision means a lot of things to a lot of people. It’s one of those terms that gets thrown around quite a bit. If you don’t mind, why don’t you talk specifically about what set the vision means to you now still and how you went about doing that work? What is it made up of? What did you guys do?
We were taught specifically when we attended the Elite Forum to start with why we are doing this, which is our purpose and vision. These three parts are our purpose, core values and our mission that we’re currently on. How we describe our purpose is why we do what we do. It’s why we exist. Our purpose is to provide peace of mind. We co-created that with our team and it’s still our purpose to this day. It’s never-ending, a non-achievable. It is more of a guiding star or guiding principle.
Let me interrupt you real quick, Morty, but you said you co-created that with your team. You got these guys from their trucks and you worked on the purpose with them. Tell me more about that.
We locked ourselves in an office for 1.5 days or maybe 2 days and continued to go through why we exist and keep pulling it back like layers of an onion until we got down to the true reason of why we exist as a company and why we do what we do. That’s how we developed our purpose.
You do sales installment service of industrial compressed air systems, but you guys have distilled that kind of work down to a purpose. What does that purpose again?
We provide peace of mind.
Together as a team, you came up with this powerful purpose that elevated the reason for being beyond installing and servicing large pieces of equipment.
That’s exactly right and some of my leaders have come up with their own stories behind it and I love it. I love listening to the stories of their purpose. Greg Smith, our sales manager, describes it best. He talks about how our purpose might be short and cliché, but it means a lot to us. Deep down, we can define it as our purpose is to provide peace of mind to each other by showing up every day and having a culture of accountability.
We provide peace of mind to our government by paying our taxes properly. We provide peace of mind to our community by creating great jobs for great people. We provide peace of mind to our customers by following our core values and making sure that they have a great customer experience, but it’s more than that. For us, it’s every aspect of what we do. We’re always looking to how we can provide peace of mind in everything we do as a company.
Essentially, you’re able to help your team move from a place of, “I’m just making phone calls or making site visits or turning wrenches,” to, “I’m now part of a cause that’s bigger. I’m excited about this purpose.” I imagine that did something for the team, but why don’t you tell me what that was like?
Even the macho list of technicians saw the value in the purpose. They became hooked on it and we started to look for opportunities and the entire team could rally around this purpose. It’s continued and even to this day, it’s still talked about every day by our entire team. I talk about the macho technicians that aren’t great communicators naturally, but they buy into the concept of providing peace of mind. It’s given us all something to rally around and see the value there.
Thank you for stopping the flow of your comments on the components of vision, but I think that was a powerful lesson for people to hear that when you bring your team into the process, they’re now co-creators as you said and there’s a lot of power in their buy-in into this new thing that we’re all up to. You started to go into the second piece of the vision, which was around core values.
Our core value is how we go about doing our job. It’s who we are as people and how we go about doing our job. Performance in our company is defined as what you do, but also how you go about doing it and how you do it, as are the ten core values that we currently have.
You’re telling me by doing purpose work and values work, which sounds a little soft and fuzzy and kumbaya to some people that’s, that’s how you started to break out of the revenue ceiling you were hitting. Is that it or was there more?
We have our purpose, our core values and the third part third component is the mission that we set. We sat down and started to nail down real goals, big hairy audacious goals. Exactly, where do we want to go and where do we want to take this business? In 2015, we sat down and what we started in ’14, we did a five-year mission from there. 2019 is the end of our mission, in which our goals were to have 2,000 customers, do $5.5 million in revenue and have 23 team members. We’ll have achieved or exceeded all three goals by the end of this year.
You went from being stuck over a three-year period right around $1 million to now being six times that. Granted, it wasn’t overnight. This is the classic several years overnight success story, but you were able to break through that revenue ceiling that most entrepreneurs hit when they hit stage four and you’ve passed into stage five, that $3 million-plus mark and you’re on your way to hitting that $10 mark. That’s super exciting.A company can fulfill its purpose and provide peace of mind to its clients if its team is growing as people and sees the impact that they have done. Click To Tweet
If I heard you correctly, by becoming intentional and learning to take some of the responsibility off of you directly and have shared some of that load with key team members, now you’re able to relinquish control. You’ve got everybody aligned to a clear vision and you can move forward. Did I oversimplify it with what else contributed there? You talked about hiring people and how you started to get a different type of person in the company.
Hiring’s a key component of that. Once we had the vision in place, we could even look ourselves in the mirror and state exactly, “This is who we are. This is where we’re going. This is how we’re going to do it. This is when we’re going to do it by.” Once we had all of those questions answered by creating the vision, now it became pretty clear who was on the team, even though this was co-created. They liked the idea of those values, but they couldn’t live by them.
Unfortunately, we had to start replacing some folks and then it became a beacon, our vision for attracting higher quality talent. When people came in to interview, when they saw our values on the wall and they saw our job posting where we talked about our purpose, we started to be able to attract people that before we had no business being able to ask to come work for us. People were taking pay cuts over what they were currently making in their job that they’re miserable with to become part of our culture and help us with our vision.
That’s what started to propel us to the next level hiring A-talent rockstars, I call them and adding them to our team. Our team right now is full of rockstars. The people that 4 or 5 years ago, we had no business being able to have some work on our team or be able to afford it. The hiring practices and having the vision was a big part of it.
You’re telling me that by getting that clear vision, you were able to attract people that you weren’t able to attract before.
That’s exactly right. A perfect example is Robert Horneman, who is the president of our branch in Charlotte. He was on the manufacturer at the national level, a top executive for a large manufacturing company of compressed air. We would go to trade shows and look up to Robert, who was kind of a rockstar in the entire industry. Before you know it, after a year or so of knowing Robert, he approached us to come work with us. That was amazing, and we can go back to our vision and the culture created because of that vision. That was why he wanted to work with us and help us expand to Charlotte, North Carolina.
I heard you also say that some of that talent is willing to come work for you at less pay than they were making before because of your vision and the part they want to play in creating that future.
They say they saw a vision and they were attracted to that, but they also saw that they could come aboard, take a small pay cut now and that money would be increased substantially exponentially over the next few years as we grew. They were convinced that we were going to grow and they were convinced that we would stand by our word and increase their pay as we could afford it and that’s exactly what we’ve done.
To review some of the highlights, you’re stuck at $1 million in revenue. The reason I’m hammering that is that a lot of our readers will have experienced that. If it’s not right at a million, it’s somewhere between $1 and $2 million, typically sometimes up to $3 million. Somewhere between $1 and $3 million, there’s a ceiling that happens as the CEO gets maxed out as they become the ultimate bottleneck in the growth of their business.
You took it upon yourself to grow yourself. You went and learned some things that could help you lead a company forward. You went back and implement it. You set the vision you hired to that vision. I know there’s a lot more to what you do that has enabled your growth, but it sounds like those were key elements to getting you past that first revenue ceiling you experienced.
There’s no doubt and to be honest with you, as we’ve scaled up, my role has become more and more of the culture and the visionary of the company. I can walk around with a tape recorder and talk about core values, our vision, the mission and the purpose that we’re currently on. That’s what it is. I constantly get people on board with our vision, whether it’s a vendor or a customer or our team members. That’s my role nowadays.
I heard you reference a few resources during our time together. I’m going to give you a heads up now. I’m going to ask you for one key resource or book or something that you would like to recommend to people, but let me review. I heard you mentioned Michael Gerber’s The E-Myth book was pivotal for you starting to think about going from winging it to systematizing things, having the process and understanding the importance of working on the business, not just in the business.
I heard you mentioned getting people in the right seats. It’s a Jim Collins concept. I think that was the Good to Great. You mentioned having attended the Elite Forum, where you learned how to set the vision and some of the hirings to the vision things that you discussed. Was there anything else that played a key role in your growth?
Let me ask it this way. You’ve set the vision and you’re hiring to it. What else can you do or what else did you do that helped you take a big hairy audacious goal to grow to $5.5 million from $1 million over a five-year period? What helps you translate that vision into reality? What processes or tools? How do you take cool ideas and make them real, other than hiring great people?
Once you hear those great people, you can go so far with training them. We talked about mixing the Kool-Aid. At some point in time, I need help mixing the Kool-Aid. That’s where leadership development for us was a key component in growing to that next level. We needed to have our leaders not only fans of what we were doing but creators of what we were doing and become their own independent departments or branches where they’re creating their own cultures and their own visions together with the company as an overarching vision. Also, to be able to enforce it and create the culture with their team members in their departments.
You had to start creating leaders, but it wasn’t just the leadership development work. It was also and you’ve said this a couple of times. Enroll and involve them in the process of creating the plans and then giving them ownership with accountability to go execute those plans.
That is exactly right.
I gave you some fair warning. As we wrap this up and this has been super helpful. For people reading, if you’re not hearing very practical things from somebody who’s done this, I don’t know that you’re hearing very well because we’re getting straight from Morty what it took for him to not just triple his business, but triple his business and then double it again. It’s tremendous growth over the last few years. Hats off to you, Morty. What would you leave our readers with as a resource or a favorite book recommendation? Anything that would help them do some of this work you’ve been talking about.If an Average Joe can achieve big things, then anyone can do the same with the right passion and drive. Click To Tweet
I think the biggest thing for us has been Audible and getting other team members that normally don’t read to at least listen to the books as they’re driving around their service trucks or their vehicles to try to inspire that personal growth in them. We created a company Audible account and we have about 150 books in there that they can tap into and play as they’re driving or traveling or even working on a job site with headphones or something if they’re able to. For us, it’s creating that company Audible account and then inspiring that personal growth in our team.
Growing individuals leads to growing your company. Do you believe that?
I do because it raises the level of the quality of a person. Even if it doesn’t directly impact us, for us, we feel it’s the right thing to do. Personally, I’ve seen what personal growth has done to my life. It’s become very important to me to share that gift with other people, my team members, my family and hopefully, my team members’ families. If they’re growing as people and people in their lives see the impact that it’s done, that’s only going to be good for our company and that’s helping us fulfill our purpose of providing peace of mind.
I’ve heard you on informer settings, Morty, talk to people as though if you can do this, anybody can do this. You downplay the level of your achievement and what you’ve done to build a great business. I want to be one of those people who is recognizing greatness. You have done amazing things and I look forward to what you’ll continue to do because there’s no road closed sign on the road that you’re on. There are a lot of roads ahead of it. You can make this as big or as much as you want. In your parting words here, give us some encouragement to the readers who think, “How am I going to do that?” What would you say to somebody who thinks, “I don’t think I can do what Morty is saying?”
I can’t stress that enough. I don’t have any special skillset or schooling that makes me any different than anybody else. I’m an average Joe that was good at working on rotary compressors and industrial equipment. We were able to take it to this. The truth is, if I can do it, anybody can. You have to know where to look and go for help and tap into those resources. Also, have passion and drive.
Morty, I can’t thank you enough for spending time and sharing lessons from your experience. It’s been super valuable. I hope our readers will go back a couple of times and note the key points you made about how you got past that initial growth ceiling to a new place. Maybe at a future episode, we’ll celebrate you getting to $10 million and beyond. Also, talk about the next level of challenges that you overcame. I appreciate you spending the time with me, Morty.
Thank you so much, Brett. I’m happy too. Have a great day.
If you want to check out Atlanta Compressor, you have four different locations, Morty. What’s the best way for them to learn more about your business?
AtlantaAirCompressor.com is the main site and then those other locations as well. Continued success to your Detroit Lions, Morty. I know you’re always watching them.
Thanks so much, Brett.
- Atlanta Compressor
- Detroit Compressor
- Clate Mask – Past episode
- The E-Myth
- Good to Great
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