Navigating challenging times with the co-CEOs and co-founders of Buildertrend

Tom Houghton:

You’re listening to “The Building Code,” your guide for a better way to run your business. I’m Tom Houghton.

Paul Wurth:

I’m Paul Wurth.

Tom Houghton:

And we’re very honored to be joined back by our original guests of episode one. The Bobs are joining us on this episode to talk about, leading through a global pandemic.

Paul Wurth:

Special episode we have here.

Tom Houghton:

It is. Just so you guys know, we’re Zooming with them right now. So everybody is working remotely at Buildertrend. We’ve kind of talked about that in a few episodes, of course. But episode one happens to be our most listened to episode out of all of our episodes. So we thought, “Hey, why not get these guys back? Because clearly everybody loved listening to them.” So here they are.

Paul Wurth:

Welcome.

Steve Dugger:

Or our parents just listened to them.

Tom Houghton:

On repeat or something.

Steve Dugger:

On repeat.

Tom Houghton:

Yeah.

Paul Wurth:

I also wasn’t on-

Jeff Dugger:

Very proud of us.

Paul Wurth:

I also wasn’t on that one. So maybe that’s the-

Tom Houghton:

No, you were. We back-filled you in, we only had four mics at the time. So-

Paul Wurth:

I was just there.

Tom Houghton:

Yeah, it was good. Well, please welcome to our podcast. Once again, Steve Dugger, Jeff Dugger and Dan Houghton, owners of Buildertrend.

Paul Wurth:

Welcome.

Steve Dugger:

Everybody is counting on us.

Paul Wurth:

Yeah. For those who don’t know, we said you guys were The Bobs.

Tom Houghton:

Yep. That’s right.

Paul Wurth:

Let’s just start with that early days of building. Do you guys even remember how that happened? Was it just joking around?

Steve Dugger:

Well yeah, it’s from that movie, “Office Space.”

Paul Wurth:

A great movie. We’ll throw a link to it in the show notes, I guess. Maybe it’s just so old now [crosstalk].

Tom Houghton:

People are like, “What movie is that?”

Paul Wurth:

It is a funny one.

Tom Houghton:

“Is he talking about The Office with Michael Scott?” No, not that movie.

Steve Dugger:

Hopefully they thought we were the opposite of The Bobs on the actual movie.

Tom Houghton:

Sure.

Paul Wurth:

And they you’re talking about like the four or five employees you guys had at that time. I think it was an endearing term.

Tom Houghton:

Yeah.

Paul Wurth:

I think I’ll give credit to Scott Siegert. I’m pretty sure he was the one who came up with that thing. I don’t think any of us-

Steve Dugger:

You are good with movies.

Tom Houghton:

Yeah, that’s true.

Paul Wurth:

I don’t think anybody expected it to stick this long by any means.

Tom Houghton:

Yeah.

Paul Wurth:

But you’re still-

Jeff Dugger:

[inaudible] up and down all the time.

Tom Houghton:

That is true.

Paul Wurth:

Fair enough.

Tom Houghton:

That is true.

Paul Wurth:

For all –

Steve Dugger:

And then one day an email magically appeared-

Jeff Dugger:

Yeah.

Steve Dugger:

… from the Bobs [crosstalk]

Jeff Dugger:

And then it was official.

Steve Dugger:

And the line for the movie that always sticks with me is like, “So what do you exactly do here?”

Jeff Dugger:

What exactly is it you say? Or do you say it is.

Steve Dugger:

Now I think people ask us that question more than we ask that question. Okay.

Paul Wurth:

Fair enough. One thing you guys have been doing recently is leading through a pandemic.

Tom Houghton:

That’s true. Good segue there. Paul’s working with… been working on those segues with Paul. So that was good. So obviously we’re living in unprecedented times and you guys are leading this fantastic company that we have here at Buildertrend through this period. You’ve also done this beforehand. Because again, if you have been not familiar with Buildertrend’s history, if you missed episode one, of course started in 2006, went through The Great Recession there. So you had to kind of right off the bat, learn a lot through that. And now here we are again, kind of facing this pandemic time. So, tell us about that process of going through it, obviously back in 2006, but then now kind of being refaced with this new challenge.

Dan Houghton:

Yeah I think for us, clearly we’ve been in two different stages, in 2008 during The Great Recession, our company was much smaller, I would say in some ways more agile, but also in some ways, much more youthful and inexperienced in our ability to adapt to change because it was the first time we’d ever faced it. Going back to that, we made a couple really good decisions. One, I think we had a lot of grace towards our customers, we love our customers. They are going through hard times and we did whatever we could possibly to help them through those hard times. And as our customers adapted to the changes they were changing their business, one thing we did, I think relatively quickly was we adapted our platform to change with them. And so when we started this business in 2006, our primary customer was a homebuilder. Today in our platform, they’re just one of many of our types of customers.

Dan Houghton:

We serve homebuilders, re-modelers and improvement contractors, commercial contractors, specialty contractors, and you name it really. And that was really born out of… diversification of our business was born out of that recession. So fast forward to today, I would say the biggest change for us was we had a broader leadership team. It didn’t feel like all The Bobs had to make all the decisions, which I can tell you from my vantage point was a huge relief because ten is better than three in a lot of cases. So we came together as a group immediately during what I would say the initial news of the pandemic and all of a sudden, there’s this domino effect of all these changes that were happening in the world. And it was the most, I would say terrifying two to three weeks in my life in March that I’ve had running this business and being part of this business because of how foreign a pandemic was and what that meant.

Dan Houghton:

You saw the stock market react to it, everything just stopped. And that was pretty terrifying, but we just started meeting every day and making changes as quickly as we possibly could. And I was really grateful for the level heads that our team had during that time, because it was as scary as the financial crisis of 2008. It just came a lot faster. The 2008 financial crisis came fast but also lasted a long time. There was some consistency with it. With this was all just, you’re kind of stared at the news like we did during 9/11, quite honestly, in a lot of ways. So I’m thankful for a great leadership team to work through it and still working through it.

Steve Dugger:

Yeah, it’s challenging, right? Uncertain times are challenging, but the other way to look at it too, is in times of crisis you’re forced to change faster. You’re forced to get out of your comfort zone. And like Dan said, we got out of our comfort zone and the whole leadership team we put our heads together met, and the great thing about a crisis is it usually creates a lot of opportunity and we did it back in ’08. It feels similar now. And I think we’re taking advantage of the opportunity, and I do think we’re going to come out stronger.

Jeff Dugger:

I think maintaining a level head is something that we did a pretty good job of during the grips of both crisis and that’s not easy to do. Wake up in the middle of the night with a panic attack about what’s happening with the market, but being able to just stay calm, stay focused on the news. We did go to a daily cadence, which made it easier for us to talk about concerns. Anything that any breaking news, anything like that. Just kind of helped keep everyone on the same page. That’s definitely very helpful. I think continuing to market through both recessions, obviously with COVID, it was a little bit different but we did tailor some messaging to our customers and to the market at large around how we were handling COVID, that we were there with them, be flexible in order to help them continue to endure the same thing we were going through. So, keeping ears to the tracks and keeping a level head has been something that our team has been good at. And it’s definitely not easy, but it helped us.

Paul Wurth:

Yeah. I’ve heard you guys talk about what… We all went through it 2008, and one of the things you always go back to is continuing to market. And Jeff, you just mentioned that. Do you feel like that’s a good piece of advice through any one of these types of things like our current situation?

Jeff Dugger:

I really think it is. And you maybe do adapt the marketing but stopping your marketing, looking at that as a cost center and an immediate cut is going to be the detriment of your business. So, that’s definitely a place to keep your foot on the gas. And we’ve been lucky through the first recession, housing residential construction in general was hit really hard. It’s a different situation now, we’ve got been a little bit luckier and that housing has been looked at as essential and it’s stayed relatively open through all this. Some industries have been hit a lot harder obviously than home building, which has helped us too.

Paul Wurth:

Yeah.

Tom Houghton:

I was just going to say, do you think having gone through it before has helped you go through it again now? And obviously they’re very different. Like Dan, you mentioned how it have impacted the market and how long the rebound was obviously initially with The Great Recession. Now we’re dealing with this. But do you think just mentally going through that before has helped kind of process through this? Because you talked obviously about, there is shock, there is concern, there’s nerves obviously, which I think are all very natural emotions that everybody felt through this process but, did you guys see the light at the end of the tunnel? Because you’d said, “Oh, we’ve done this before.”

Jeff Dugger:

I don’t think you ever get used to it.

Dan Houghton:

I think the table stakes are a lot different. In 2008 we had 15 employees, today we’ve got 550. So, that’s the beauty of operating a business that has this, it’s like a lifetime. As a roughly 40-year-old, my life is a whole lot different today than it was when I was a 30-year-old when the financial crisis was coming. So I would say it felt… this thing felt the same. The reaction was different, which I think was probably the most noticeable thing now, looking on both. Paul can attest to the reaction to the financial crisis was just kind of pure panic, work harder, brute force. What are we going to do? We’ve got to figure it out today. We don’t have time.

Dan Houghton:

You almost felt every day was your last day in some ways I’m sure many of our customers felt that way, where this time around much larger customer base, much more I think strategic thinking around our options and what we had to do, which was a different reaction, but there’s still the instinct kind of fear that comes along with anything that you’ve never faced before, it still is to me is the same. How are you going to react to that fear is different. And I’m a highly emotional person where I think the reason why Steve, Jeff and I work really well together is because they’re not highly emotional. In fact, Steve’s superpower is not having emotions at all. That’s the joke his family makes about him but, and that’s a good compliment to each other because I felt like I knew COVID was going to be really bad, and I was like, “Oh my God, the world’s going to end.” And Steve and Jeff were both like, “Yeah, it might be bad, but the world’s probably not going to end.”

Steve Dugger:

I was definitely fearful. I was definitely fearful but going through it once I think did help. And I think our leadership team, what we learned the first time around this, we were able to apply to this and Dan already touched on it. It’s you have to remain calm, right? You have to be transparent and honest with your people. I think that’s the biggest thing. Your people can tell when you’re not truthful on these situations and that’s obviously the opposite of what you want to do. If you’re going to lean on them to work harder and be more persistent in these times, because let’s be honest, that’s what you need, that’s what a business needs in this time is to really put the pedal to the metal. And what we’ve found is if you’re transparent and honest with what’s going on, people are much more willing to answer that call.

Paul Wurth:

Yeah. I think all that was really good. What’s interesting is most of our clientele probably lived through the 2008 because they were some of the best construction companies that survive that. So they’ve definitely understand what you guys are saying. I think it’s a good point. What’s unique about this crisis is that so much more global, like human. We just didn’t know how life was going to be instilled out and where the 2008 was just, as Dan said, just financial it’s like we got to survive it and it’ll all come back. So thinking about from that perspective, how even your employees may not be concerned about the business, but they’re concerned about their life, right? They’re stuck at home, they don’t know what the future is going to be. What has the company done or what have you… have you guys thought about that when it comes to your employees? Because I think that’s what the business owners that are listening to this are probably trying to navigate right now too.

Dan Houghton:

To Steve’s point being transparent on one, we don’t have all the answers. Like Steve said, it’s going to be pretty obvious that you don’t. And we were really up front. And I think in our first town hall meeting, we have a town hall meeting as an organization every three months. And we had one relatively right away after all this stuff started to happen. And we, as in The Bobs basically sat up in front of a camera and said, ask us anything. And it was, are you going to make layoffs? For example, we had two tech companies that will all make a lot of layoffs. I think our answer was, “Our goal is not to make layoffs. We aren’t going to make any layoffs right now, but we can’t promise you what we don’t know. And if we can ask you anything, is to work harder than you’ve ever worked before because we want to avoid making layoffs as much as possible.” That was as transparent as it gets. We didn’t know if we were going to make layoffs.

Paul Wurth:

Mm-hmm (affirmative).

Dan Houghton:

We’re talking to an audience of 550 people that are all fearful for what tomorrow is going to look like. And in that case, you can be as strategic and as thoughtful as you want, but you also have to be really human to your people. And I think humanizing what you didn’t know was really important in that part. And Steve and Jeff and I, that was just a moment, but our leadership team and our managers that were managing people were doing that on a daily, weekly basis with their team, double down on the communication, which we really said, “If you’re not going to see everybody in the office anymore, you better be talking to them, via Teams or a chat or whatever it might be.” Looking back on the last about six months or nine months, I think we excelled in that area and we could have easily just said, “We’ll figure it out later.” And fortunately, we didn’t say that and we acted quickly.

Jeff Dugger:

Things got really rockier, but I think that our team led us through that. They stepped up, we were able to continue to get the work done we needed to get done. And our leadership team kept the communication lines open. And that was critical, really. Because like you said Paul, people’s lives changed overnight and everyone. We were all in a different situation a week later, it happened so fast. So that’s definitely something that having been through it, I think our entire company comes out of it stronger than ever before.

Tom Houghton:

So you guys have mentioned obviously numerous times, even in podcast number one, we talked about how important employees are to our company. But you’ve mentioned, we’re working remotely now. So what has it been like supporting everyone from a distance instead of being in the office?

Dan Houghton:

That’s a full-time job for a lot of people just to think about it, quite frankly. It used to be a walk in our office and you just felt it, you felt the culture, you felt the connection with people. And we’ve had to make it a responsibility of people that wasn’t their full-time responsibility. But to think about that day and night on engagement, whether it was our internal marketing team, our HR staff, our leaders, to think about how we engage our team because there was a huge fear I think of all of ours that, it’s not necessarily I’m worried about the culture of Buildertrend failing because we’ve got a strong culture, but we’re worried about individuals not feeling that personal connection. And in all parts of their life.

Dan Houghton:

If you go to work, and then you go play sand volleyball, and you have a beer and tea with your friends or you’re used to going to church. A lot of people hadn’t been able to go to church in the last six or seven months. You’re losing those connections that really drive you as a human being. And we’re eight hours, we’re one third of someone’s life. And so we’re responsible for really driving those connections and it’s not easy, right? And so I think for us, just the constant engagement with our team has been incredible. And could we do more? I’m sure we could but we’re doing as much as we think we can do as fast as we can do, that will be effective. We don’t want it to be just do things because we think we need to do things. We want to be very purposeful around the way we’re interacting with our team. So it’s been nice that things are starting to open up a little bit where we’re at.

Dan Houghton:

So you can start to socially distance, at least see people and outside of doing it on Teams or whatever it might be. So there’s definitely some light at the end of the tunnel, but we’ve still got hurdles ahead of us on how we continue to do this, especially as we walk into, I’d say the winter months, right? Summer is a whole lot different being stuck in your backyard. And the Summer is a lot better than being stuck in your backyard during the winter. And that’s going to set up a whole new set of challenges.

Steve Dugger:

Yeah. We’re fortunate that we serve our clients a hundred percent remote already. So we’ve had relatively little impact on how we serve our customers, but our internal culture and employees have taken the brunt of this with the work from home. I kind of look at this two ways: There’s the short-term and then there’s the long-term. The short-term is how we’re managing this. Our people managers are doing a great job checking in remotely. They’re doing a great job taking employees out in small, safe groups in person for small outings to try to keep that human connection and camaraderie as well. But to Dan’s point in the long-term, we absolutely are working on a plan to get back into the office safely because to his point, humans are social beings and we worry that if the work from home goes too long, that could really take a stress on people from a depression standpoint, anxiety and morale, just all of the above. So, definitely want to get back into the office as soon as soon as it’s safe.

Paul Wurth:

Yeah. It feels like the common theme. If you’re a business owner listening to this, because obviously we’re a technology company, a huge employee base. But if you’re one of our clients that has three to ten employees, this is an excuse to over-communicate this pandemic. If you haven’t been doing it well as a business owner or you just haven’t had the chance to do that, this is a perfect excuse to just start doing more frequent communication, whether that’s weekly, daily Zoom meetings, things like that. So maybe that’s a takeaway for our business owners.

Tom Houghton:

Absolutely. Speaking of business owners, of course, you as business owners are in charge of strategy and direction of the company, and I’m sure many of our listeners would be curious to see how you’ve had to rethink the strategy of our business and kind of pivot potentially. So what advice do you have for other business owners and how have you approached having to potentially change the strategy of our business or our customers business?

Dan Houghton:

Yeah, I think for us, it was about working fast and being thoughtful around making decisions. I think it’s easy to get paralyzed when change comes your way. And I think this forced us to make decisions a little bit more quickly than we would have in past situations. Because if everything’s status quo, you can be really thoughtful, you can waste some time and spend a lot of time talking about how you’re going to do something so you get it perfect, right? And for us, we knew we didn’t have the luxury of perfection, being perfect on this. And we said, “Let’s just go out there and test a few things.” So testing was a really big part of this. So testing a new pricing strategy, dealing with the customers that may be needed, put their account on hold or whatever it might be. We were testing a lot of things and we were moving people into new roles relatively quickly.

Dan Houghton:

We had three dozen people that essentially couldn’t do their jobs anymore because of COVID, whether it was going on the road and consulting our employees, our events team, whatever it might be. So testing them in new roles, pivoting them fast was really critical to I think us being able not to have to worry about that so much six months passed, kind of when all this stuff exploded and we did it fast. I was really grateful to our management team for really digging in deep and making decisions, being thoughtful but making them quick too. Because you can always roll stuff back, not everything’s going to work but not being paralyzed is a big part of it.

Jeff Dugger:

We were in contact with our customers pretty regularly as we always are, and we’re able to kind of get a feel for what they were going through and what their businesses look like. And this came up earlier, we’re still an essential business in construction in a lot of ways and a lot of our customers coming out of March and the first half of April, actually their businesses ramped up. And so making sure to stay with them and stay ahead of them and we continue to hire to backfill and to keep up with that growth. I also think that just COVID in general and the remote demands that it’s put on all businesses out there is something that’s a headwind for our platform and what we offer our customers.

Jeff Dugger:

So making sure that we’re able to take advantage of that and we’re able to show the market and our customers exactly how they can use Buildertrend to better operate their business in a COVID world and post-COVID world is something that’s been front of mind. And our marketing team has done a good job of making sure that we’re marketing that and our teams are connecting with customers to make that dream a reality. That’s definitely something that’s changed and we had a big technology shift that was a headwind for us with the iPad and iPhone and smart phones and 4G. And I wouldn’t put this at that scale, but the amount of people who are now interacting remotely and doing remote video and just conducting their business in a way that’s not hands-on remote signatures is at an all-time high. And so that’s definitely something that bonds well for our platform. We’re ready and waiting to offer those things to customers.

Dan Houghton:

Which is funny because we didn’t know when we should start marketing that. So Jeff just said out loud, our product since COVID happened, it’s actually not been a bad thing for Buildertrend, and it’s not been a bad thing for a lot of our customers as well. There’s a lot of tailwinds behind our industry right now, but one of the things that was really interesting, and I’m sure a lot of our customers are maybe still thinking about this is like, how do you take advantage of a bad situation? Because this is a bad situation for our country and people around the world. But the reality is there’s a lot of people putting pools in right now, and that’s not necessarily a bad thing for our customers. And so how do you use this delicate balance of marketing around spending more time at home?

Dan Houghton:

Maybe it’s time to put a pool in or how you’re utilizing your software or whatever it might be. Those were conversations we were having early, and we were talking about marketing. And one of the things we just did early was let’s be a resource for our customers around COVID. So job site cleanliness, all the things that we could gather from experts, our lawyers, how to do deal with the PPP program, let’s be front lines of helping our customers navigate the really tough, unusual hurdles. And then it’s like, “Okay, now that this is our reality, and we’ve gotten there, how do we help our customers utilize technology that’s good for both us and our customer and their customers during a really strange time?” And it’s a little weird to have those conversations. Like life sucks right now, but it’s really good if you’re a contractor and you’re using our software. That gives you an advantage. And so I think it’s always an interesting thing that you have to balance when you’re talking to your potential customers.

Paul Wurth:

Yeah. I think that’s a great piece of advice, and by the way, we’re not out of it either. So if you’re a business owner and you’ll educate yourself on your local restrictions and things that are happening as we sort of hopefully get out of this with some sort of vaccine or cure. There’s going to be more regulations coming down the pike, and they’re all different depending on what state you’re in, your county. So I think it’s probably a good piece of advice if you’re a business owner or somebody in your team just needs to be in as much as you can be an expert in what’s happening. And then that’s a good part of your marketing is being an expert and being the go-to to know what is safe, what isn’t safe as relates to construction.

Tom Houghton:

And to Dan’s point, obviously we here at Buildertrend want to help. We see ourselves as partners in our customer’s business. And so we’re here to help them. And I’m sure, the last time we went through this as a company, we probably weren’t prepared to be the experts in the field, but now here we are, and you’ve gained so much experience and now we can pass along that help to our customers, right?

Paul Wurth:

Yeah, absolutely. And we’ll continue to. We still have that page up on the website we’ll throw in the show notes for everybody.

Tom Houghton:

Yeah.

Dan Houghton:

It will change, right? Somebody’s not laughing.

Tom Houghton:

Yeah.

Paul Wurth:

Exactly.

Dan Houghton:

That’s the crazy part. I literally just had to get up and point at my kids and put the quiet face to them because I’m working from home. We’re going to inherit these new things that like jump up and to Jeff’s point, the rules, the regulations, all this stuff will evolve and change and we’ll try and do our best to be on the forefront for the customers. But we want your feedback too. That’s a big part of this. We’re work experts, but we become experts because we collect feedback and we want to hear from our customers on what they’re feeling out in the market. That always helped us a lot.

Paul Wurth:

If you’re listening, just email Tom directly.

Tom Houghton:

We’ll put that in the show notes.

Paul Wurth:

He’ll relay that. We’ll give them your quote-

Tom Houghton:

We’ll get it to the right person.

Paul Wurth:

You prefer text messaging, right?

Tom Houghton:

Yeah, exactly.

Paul Wurth:

He prefers a text message.

Tom Houghton:

You can reach me at 555-4444. Awesome. Guys, thank you so much for coming back on the podcast today and just talking about your experience during this time. I know a lot of business owners out there probably really appreciate hearing from other people. I think that’s one thing that we kind of touch as a central topic is that this time around it’s affected everyone globally. So we’re kind of all in this together, so I appreciate you coming on and being a part of that discussion with everyone here and sharing your expertise with that.

Steve Dugger:

Great. Thanks for having us.

Jeff Dugger:

Yeah, absolutely.

Dan Houghton:

Love the podcast.

Tom Houghton:

We got that recorded. So we’re going to save that recording. Awesome.

Paul Wurth:

Thanks guys.

Tom Houghton:

Love what you heard. Don’t forget to rate and subscribe to our podcast so you can hear from more guests that will benefit your business. Also, please check out our show notes page for more information on what we discussed on this episode, you can find it at buildertrend.com/podcast. Thanks for listening. And we’ll see you next time on “The Building Code.”