Dave Royce on Pest Control, Private Equity, and Purpose

The Money Mondays

Dave Royce built four pest control companies and a solar business, using asset deals to reinvest profits and scale rapidly. He shares insights on sales, investing, and philanthropy, emphasizing purpose and financial discipline. The episode covers door-to-door sales, scaling teams, and giving back. It also explores the psychology of wealth and the importance of meaningful work.

Key takeaways

• Asset deals enabled rapid company scaling with retained control.
• Top sales reps earn $500K+ annually through performance incentives.
• Financial literacy training prevents wealth burnout among young earners.

Transcript preview

Ladies and gentlemen, welcome to a special edition of the Money Mondays podcast where we cover three core topics, how to make money, how to invest money, how to give it away to charity. Our guest has built a humongous company in a very unique category that every one of you has dealt with. Things that happen inside of your household or right outside of your household, you might be thinking, what is he talking about? Is in my alarm system? Is it the... The pest control situation is my roofing my garage. What is it? We're gonna dive right in what I want you guys to keep in mind these podcasts are under 40 minutes for your listening pleasure because the average workout is 45 minutes the average commute to work is 45 minutes This episode will be between 36 and 40 minutes for you guys We're gonna dive right in Dave give us the quick two minute bio so we get straight to the money Yeah, so we built four pest control companies in a solar energy company Yeah, and part. And part of that I figured out this thing called an asset deal where I could sell off just the customer base basically the book of business I could sell that off take all that money and throw it into the next company and so it was a way to basically get investment with and still being able to have all the control and all the equity on my own wow so I did that for about 20 years every roughly every four years the first four years I would sell get money you know rinse and repeat same thing over and then yeah became the third largest residential pest control company yeah Were you working in the space? How did the first one start? Yeah, so I was a starving college student working minimum wage and I had a friend come to me and he says, hey, I made 25 grand last summer, selling pest control services door to door. Just knocking on doors. Yeah, I was like, okay, I don't really even know what that is, but I'm in. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. So I drove out. Yeah. So I drove out. Yeah. So. Yeah. So. Yeah. So. Yeah. Yeah. Yeah. Yeah. So. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah. Yeah a commission only job so the only thing I was getting out of it was free cardio. Yeah so I went to a bookstore that weekend got like half a dozen salesbooks and then I said I'm going to read 90 minutes every day and just keep learning and trying to learn how to sell because you know this is my best opportunity at this point in my life. By the end of the summer I was the top rookie the whole company I had a different company the next year I became a sales manager and when I got there they didn't have any training manuals and so I actually asked my boss and so I actually And he was super impressed ultimately he said I'm gonna give you if you'll keep doing this every year because we sold twice as much as his other location cool if you can if you keep coming back I'll pay you a cut off everybody and so by the time I graduated college I was making 225 grand a summer a summer yeah that's 20 years ago so it's like half a million days yeah for sure okay so we cover these different topics of how to make money invest money give it way to charity on the make money side you're saying that these 22 make $25,50,000,000,000 plus in one summer? That's right. We have a few that even make a million dollars a year. A million dollars in one summer. Yes. Oh my God, just knocking on doors. Yeah, they're freaks of nature. But you know if you have like 3,000 salespeople you start to get these anomalies where some people are just really amazing and almost all the sales managers are like a six-figure income for the summer. But there's a few guys where they'll do it for maybe they'll expand their summer to maybe five or six months. you know go surf the rest of the year because of the weather or is it because that's the right time to do it? It's kind of the right timing like that's when pest pressure is the maximum is in the summer time and because college students are out in the summer it's just kind of how the industry originally started at least this specific marketing technique started. Is anybody going out in December in the rain? There's a few yeah, but most people if they do that they're probably in California, Florida, Arizona. Where's not that heavy on the weather side so it's not quite as intense right. How do you get 22 year olds to 25 year olds to show up and work and stay consistent all summer? Yes, we recruit them. I was originally recruited. There were probably only 500 salespeople in total in the entire past control industry when I got into it. And the idea had been around for about a decade. But what I noticed is that the training just wasn't great. There was still a lot of room for improvement. And because of my really bad experience, I didn't want my friends to go through that. And so we just started developing that. And from there then it became like, okay, well, how can we recruit? So I got really good at recruiting. I had about 100 people coming out to work for me in the summer times. And then from there, when I ultimate, it was my boss that said, why on earth are you going to go do investment banking? Like, because I had a finance major. He's like, you really should go do your own pest control company. And I'm like, yeah, sorry, that's embarrassing to say, it's embarrassing to say, I thought, you know, I'm going to be a college student, I'm going to go to go to go to go to go to But he's like, by the way, I'm selling my business for $10 million. And I was like, wait, what? And he's like, yeah, I'm going to sell at the Terminix and I'm going to take some time off. And yeah, I've made, you know, I put a few hundred grand into it. He was like, you should really go do the same thing. And that's when the Light Bowl kind of account for me. I thought, huh, well, well, maybe I'd just kept going going. It's kind of like each level of like each level of really figuring out how does it what is the business how does it operate understand the financials the metrics the second business I did it was okay how do you scale how do you go into different states you know and scale with lots of people the third one was like how do you make it a really cool unique business and recruit you know thousands of people with unique talents and so that's when we got like crazy headquarters and you know NCAA basketball core golf simulators ping pong fus ball that kind of stuff we did our toy drive there like two years ago we were three years ago we were on the basketball court. Yes you know what I'm talking about. Okay so let's say a hundred sales reps show up let's call it Salt Lake City. Yep. 10 or 20 them they suck and they fade away like they can't they're not cut out for it. Yeah usually about 25% of the reps go this is it's just too hard. You know long hours you know you're in the sun all day knocking doors tons of rejection and then of those 25% we usually get about half of them to stay with what they'll transfer into position and then the others just are like you know what I'm out sure yeah and then we'll get apartments for them you know all across the country oh cool we knock over 5,000 different cities throughout the country and 3 or 4 states yeah we're in 34 different states there's over 5,000 cities that we actually knock doors oh my gosh so we get apartments in every single state set it up for them and literally they just can move out stay in the apartments and you know work six days a week all right the middle tier guys that to 80%, what are they doing? How much are they making? What's the general concept? Yeah, first year rep, maybe it's like 25, 30 grand. A second year rep, someone who's already done it has experience. They might be around 40, you know, 45. And then a sales manager, if they're recruiting friends, they can make a cut because they're recruiting and training all their friends and they manage them over the course of summer. They might be around 100,000. Just like for averages. And then your superstars, that top 10 or 20% or 20%, what happens, 20%, what happens, 20%, what happens there? It might be like if someone just on their own and they're not managing a company but they're gonna sell like a thousand plus accounts they might be at you know half a million or something But then what the guys will do is they'll if you have if they're a sales manager They'll try to create other sales managers underneath on Yeah to create like a region yeah and then you know they'll try to create a division and then you know if they've got several hundred people underneath them then ultimately So they almost making their own company under your company Yeah, I mean it's it's somewhere how with the sales force but yeah it's just like they're able to make a little bit we really stick it to numbers it's just easier to calculate as opposed to just giving people some sort of a salary or whatever they're much more incentivize if they can really it's almost like owning a piece of the company in the way or owning a piece of the business so with a lot of other brands that