This episode discusses how to level up the franchising model with the help of creating an amazing culture and support. Michael Wagner, the President of Pool Scouts, joins Nick Lopez as he shares his journey navigating the ins and outs of franchising. In this episode, you will get the chance to understand how executing an objective plays a big part in the success of how to bring your franchise into the limelight. As we dig into where it all began, Michael Wagner elaborates on the techniques and processes that have countlessly brought success to his workplace as he puts in the hours to bring in the right people, create a strong foundation of process, and bring a fun environment to his employees to solidify his franchising structure. Get the chance to learn about a process that has helped Michael Wagner become successful, so listen in on this insightful elaboration.
—
Our guest is most certainly a talented individual who is doing some incredible things. I’m excited to share his story and this incredible brand. We have the pleasure of speaking with Michael Wagner of Pool Scouts. Welcome to the show.
Thank you. I’m excited to be here.
Many folks go through life, and frankly, I don’t understand the franchise model. It could be Burger King or McDonald’s, you name it, but who would have thought in an industry like yours and many other blue-collar, franchising is making an incredible difference and providing a lot of jobs and impacting local communities all across the country. The point I’m making is most folks don’t necessarily raise their hand and say, “I’m going to get into franchising.” Franchising has this way of finding folks. I’m curious, how did franchising find you?
I’m knocking on 54’s door here in the next couple of months. I am fortunate to have had a couple of careers in my life. While I wasn’t in franchising, I was in businesses that had fully owned subsidiaries or branches. In my first career, I was working with a company that we became multinational. My job was to open up our subsidiary offices around the world.
It was taking the same union economic model, business model, using corporate entities and investment dollars to set up subsidiaries around the world. We started in Brazil and ended up in Brazil, Europe, Mexico, and parts of Asia, and worked there for ultimately many years. Similarities from the standpoint of having a unit economic model and following different parts of the world.
I worked for a large credit union where we had 62 branches, which were banking. Nonprofit banking basically, but each one of those branches did the same thing. Ironically, I had met Kevin Wilson, who’s the CEO and Founder of Buzz Franchise Brands. Both of our kids now are college graduates and they’re professionals.
We met at a birthday party with our kids, maybe a long time ago. I stayed in touch with him along the way. He was always somebody who had a tremendous amount of respect. He grew entrepreneur with financial acumen better than anybody I’ve ever met. I had followed his career and while he was in private equity-type things, he was involved in a lot of franchise businesses. He himself had started up early on in his career. A bagel business that was a franchise that he did in Texas and had been involved in delivery tax and a bunch of other things from an investment perspective.
I came across rows in my career and stayed in touch with him and had the opportunity to join Buzz Franchise Brands in 2015 to start the second brand. At that time, we had Mosquito Joe, which was the first brand that we started in 2012 and built up until we sold it in 2018 to Neighborly. Right out of the gate, it was an unbelievable team of people, Brown Kevin, Brian Garrison, our COO, Angela Balls, who’s our Chief Marketing Officer, Mike Hull, who’s our CFO, and others who were involved in the franchise development.
There was a model here of how do you scale a business through franchising, take the expertise, which a lot of the expertise we brought to the table that was unique was the financial side but marketing, which we do a lot of and I’ll talk a little bit about in the future. I had this chance to come start a brand, but with resources. An unbelievable opportunity. I was able to come in and also be an investor which was another thing that was important to me.
All of our leadership team are investors in the company. That’s how I got started. I didn’t have the experience or background in franchising per se but I had done the unit economic model and the consistency in the building of that. I was surrounded by a team of people that had done it successfully with Mosquito Joe. We were able to replicate a lot of those things, albeit the business is different.
There were some similarities that we were able to leverage there. It started in 2015. We built the brand and we made a small acquisition of a full-service company in Virginia Beach where we’re located then we started franchising and launched the business officially at the beginning of 2016. We signed our first franchisee in 2016. Since then, we’ve been growing and evolving as a brand. We have 96 territories that have been awarded across the country and 74, which are open. We’re in eighteen different states around the country.
It’s gone well. Alongside Buzz Franchise Brands, we have now four brands in our portfolio. Even though I mentioned we sold Mosquito Joe in 2018. We started Home Clean Heroes in 2017. We made an acquisition of a brand in 2019 called British Swim School, which is now the largest brand that we have in the portfolio. We launched a lighting business called Wonderly as well. We now have four brands. That comes with a shared services team, which is great.
It is a team of people that supports all of our brands. We’re able to scale some of those vendor relationships that we have for systems and those kinds of things along with our finance team, training team, onboarding team, and marketing, as I mentioned. We’re fortunate. We have about 75 people in Buzz Franchise Brands who work across the four brands that we have. We’re based in Virginia Beach, Virginia, but we have, I would say, three-quarters of our workforce here and about a quarter is remote.
Tell me more about Pool Scouts.
Pool Scouts, as I said, started out as our business. First of all, what do we do? We’re focused on the residential swimming pool, cleaning, maintenance, and repair are our business. Two things I love about our business. We know exactly who our target customer is and we build our territories alongside that criteria. It’s single-family homes with in-ground pools with incomes above $100,000. It’s a laser focus on who our prospects are then we know what we do.
We focus on the residential recurring revenue model of cleaning, maintaining, and repairing residential swimming pools. Those are two things that make our brand scalable and easier to operate. As a company, we were in people’s backyards almost weekly. We averaged over 18 services per customer across the entire country. We averaged over $1,550 per customer. Some real scalable metrics and predictable metrics around our business model. Our vehicles and technicians are scalable as well.
As the business grows and the customers grow, then you hire another technician and get another vehicle. There’s real predictability and scalability in the Pool Scouts business model that I like. It is a business that we can expand our services to those pools that we service on a regular basis as well. It’s been around since 2016 officially. As I mentioned, we’ve got 46 unique franchisees and 18 different states. We’ve had robust groups.
On top of that, the pool business itself, no mystery here, during the pandemic, exploded. The swimming pool growth was 24% per year over the prior two years and has created an additional number of pools that need to be serviced around the country. There are about twelve million residential pools around the country. You think in the bigger states that you think of California, Florida, or Texas, but up there is in New York as well, in the top five. Seasonal markets also are great markets for us as well just the year round.
What made you select a leadership team in the pool industry?
There are 56,000 swimming pool service companies around the United States. Most of our competition around the country is mom-and-pop businesses that might have a single vehicle. I’m sure you’ve heard this in other home service businesses. There’s a lot of that business out there. We felt like there was an opportunity to professionalize this space, create a brand, create higher standards, enforce higher standards, drive higher pricing, and make sure that what we do is 100% above what was licensed, bonded, insured, and showing up in a branded vehicle and the marketing of the business.
Most of the mom-and-pop type companies don’t do any marketing. We do that laser-focused marketing to drive customer acquisition. The ability to stand out, we felt was pretty prominent and that’s proven to be very true. We’ve had robust customer growth. We have an NPS of 88 now. We finished an NPS of 79. I know a lot of people think of grades and say, “79 is not that great.” In the net promoter score world, that’s an exceptional score that rivals even the best companies you think of when it comes to customer service.
As I said, the ability to stand out amidst the sea of competitors, particularly mom-and-pop companies, was pretty substantial. That’s why we chose it alongside it being a recurring revenue predictable, scalable, and relatively simple business model. Those are all things that we liked. We took some of the experience and knowledge we had from Mosquito Joe, which is a residential pest control business, and said, “This is similar and we’ve been able to scale this one well.” While the business models are different, that is what pushed us to choose the swimming pool business to get into and it’s been a good choice.
The opportunity is clearly being exposed. Where are you in terms of growth?
Our system-wide revenue growth grew at 46%. That was great. That was for a multitude of reasons. We’ve done a good job of customer acquisition across the board. We’ve done a great job of customer retention. We build the space and then build on top of it around the country. We’ve increased our franchisee footprint and expansions within the franchisee footprint.
What I mean by that is we offer territories to prospective franchisees. Those territories are single-family homes within ground pools with incomes above $100,000 and up to 10,000 target households that are meant and protected by ZIP code per franchisee. We offer up to three territories per franchisee in the case they purchased two territories for instance. They opened one. Then months later, they opened up the expansion territory.
Not all the same startup costs but you’ve got some scale that you’ve built in that first territory. We have folks that have expanded beyond their first territory. We’ve driven the number of services up per customer and the revenue per customer. We have increased pricing as everybody has over the past couple of years with regards to the cost of goods sold and labor going up. We’ve done a better job of maximizing the share of the wallet with the customer. It’s a multitude of factors that help lead us to that high growth. More pools need to be cleaned, more services per pool, higher revenue per service, and an expansion in the services that we offer and the things that we attribute that to.
That’s certainly not going to stop.
Not at all. We’re continuing to expand the services we offer. When we have 71% or 72% of our customers are recurring service, which means they’re weekly or bi-weekly customers. The opportunity to expand the services, particularly when you’re in their backyard every week, is pretty substantial. We have a huge customer base across the country that’s recurring. We continue to look for ways to expand the offering of products that we service them with.
All that growth means franchise owners are growing and expanding their businesses. That’s a reflection of growth across owners in the market, more market share. Are you folks currently working on any other initiatives to continue that growth?
We launched an initiative, two initiatives. We serviced around 14,000 customers across the country. We expect that number to be 17,000 or 18,000. We launched an initiative to get into liner replacements. Depending on where we are around the country, liner pools are prominent and common. The other initiative was with safety covers. We have seasonal markets with some that have liner pools but a lot of them have safety covers that they cover the pools with during the winter time.
We did both of those projects for an initiative where we taught franchisees how to do liner replacement. Those are jobs that are anywhere from $5,000 to $8,000 jobs to replace a pool liner. We had to get the expertise and we brought some of that in. We had to train all our franchisees on the model itself how to do it and how to do it well. We did that and that was very successful. We also had a couple of referral partnerships that we signed for pool refinishing.
We had these 14,000 plus pools and many of them need to be refinished. We signed two different partnerships where we were able to refer those jobs out to companies that were nationwide in some cases to be able to come in and do the pool refinishing. Our franchisees were getting paid a referral fee to make that happen. Those were two things we did.
We’ve expanded already to offer our first pool fencing franchisee that’s going to be focused on doing pool fencing. It’s a safety fence around the pool to protect kids from falling in. We’ll be installing our first safety fence in Huntsville, Alabama. We’ve partnered with a great company on that and hope to expand that across the country for our franchisees as well.
Those are things in addition to expanding the repair services we offer, which once again, we have to teach and educate all the franchisees on how to do these things. We’ve done that through classes that we offer in different regions of the country. We make sure everybody gets the certifications and licenses needed to do all the work that they have to do. We’ll continue to look for ways to expand the services offered to our precious recurring customers.
The more areas where you can solve and create value, that’s more opportunities to grow your empire as a franchise owner. Can you share a little bit about the timeline of growth? I know you mentioned the acquisition and some exciting milestones. Could you give me some clarity on the timeline?
As I said, our first franchisee we signed in 2016 and now we have 46 franchisees across the country. We had robust franchise growth during the pandemic. In 2023, we had not as many new franchisees come on board. We had a franchisee signed outside of Philadelphia. We’re excited about that. We have some meet the teen days that are planned and scheduled but we’ve had gradual growth. I would say that our growth for franchising was slow in the first couple of years and picked up robustly during the COVID timeframe. Even 2018 was a great year for us.
It’s been pretty steady since then with some peaks during the pandemic as well. We’re expecting a solid franchise development in 2024 as well. As with any franchise system, you have your early adopters that are willing to come into a new franchise system. As the business model gets more established, it becomes in many cases less challenging to find the early adopters. You’re looking for people who want to look into the business model and the unit economic model and be able to validate with multiple owners and those kinds of things. That’s where we are.
The brand itself has grown thanks to a lot of efforts on behalf of PR that we’ve done and partnerships that we’ve created around the country. At the end of the day, in any brand franchising, the franchisees are the ones that are the proponents of making the brand solid across the country, and things like our NPS score and the awareness we have, some partnerships we have, and the charitable side of things. Everybody doing the job at the local community level is something that elevates the brand. We have a great group of franchisees that do that well.
What’s on the horizon? What’s next?
We have a long way to grow. I’d like to say that term, but we do. We’re in eighteen states. There are some states where we won’t ever have a franchisee in Alaska. There are not enough tools in those. We look at the markets where our concept is viable. It’s markets that have high concentrations of residential swimming. There are a lot of them out there and a lot of areas for us to expand to.
When I look at us close to 100 territories, I see our business easily with the opportunity to have 200 to 250 territories awarded around the country. Of the territories that we have now, as I mentioned, we have 74 that are open out of 96. We still have those expansions that will happen organically with our existing franchisees. What makes me super excited is to see that.
I mentioned our first franchisee and our first franchisee in Raleigh, North Carolina. Tiffiny Consoli is her name. She started the business in late 2016. Her business is still growing like gangbusters. In 2024 alone, she’s seen over 30% growth year over year. It’s exciting to see the opportunities because the market opportunity has grown with so many new pools. That’s certainly expanded what we can do. Finally, expanding the offering of services that we provide to all these recurring customers that we’ve got around the country. There are lots of different ways for us to grow. We plan on taking advantage of as many of them as we possibly can.
It’s clear that you folks have done a tremendous job of creating a culture of high-performing franchise partners. What are you looking for in a franchise partner?
Our business is very much of a people business. When you look at how our business scales, I talked about numbers before. We can do, depending on which market anywhere from 8 to 20 pools a day with a single technician and a vehicle. Who’s doing that work? A person and a technician. That business, as it scales and grows, there’s a lot of people involved in our business. Number one, you have technicians. Number two, you have customers. I feel like people’s skills are a necessary part of a successful franchisee in our business model.
When we look at a mature franchisee that might have 16 vehicles or 18 vehicles out on the road every single day, there are a lot of moving parts to that business. We have systems like any franchise would make that manageable, but it’s a lot of people. It’s a lot of customers. The ability to juggle those things is important. People skills like folks with financial acumen even though we provide systems to help do budgeting and manage the business through a CRM.
We like folks who are comfortable with a lot of moving parts, plates in the air, balls to juggle, or whatever you want to use as an analogy there. That’s important for us as well. I’m sure you’ve heard this a million times with your show, but people are not afraid to be business owners in the community because we touch a large base of customers. We have franchisees that have over 1,000 customers. That’s a brand presence in a community.
We like people who are not afraid to be the owner of a business in that community and stand up and do some local marketing and shake hands and kiss babies when necessary. We feel like those are the keys to finding successful franchisees. Finally, folks who understand customer value. I don’t mean numbers and dollars. It’s net promoter score, employee appreciation, and culture within their organization. These things are a little bit harder to measure than numbers, but they make a difference in business. Are you a business that people want to do business with? That’s always a question folks should ask. Our most successful franchisees are that.
At this point, you’re far beyond those early years, as you mentioned, early adopters, but even speaking to that, your first franchise owner is still growing. You mentioned 30% plus this most recent year. That is tremendous. It speaks to what you spoke to, the people and the culture. That does not surprise me because of the leadership within your organization.
Clearly, with Pool Scouts yourself and with Buzz Brands, that is clearly intentional, and one franchise partner at a time from the discovery process and the training. Everything is intentional in creating the culture and the brand that you’re building. I know customers are certainly benefiting from it in the community. That is the power of the franchise model.
When you take the franchise model to another level and create an ecosystem of brands such as Buzz Brands, now you have 75 folks. I believe that was the number that you had mentioned on the support team. That’s a lot of horsepower behind an individual brand much like franchise partners come together to do business with one another. These franchise organizations are coming together to do the same thing, share best practices, create economies of scale, and compound a winning culture. Could you speak to what you’ve lived out specifically with Buzz Brands? What makes the people within the leadership team so special?
It starts with Kevin Wilson, our Founder and CEO. A brilliant entrepreneur, but having come on board here myself in 2015 but the prior team starting with the acquisition and startup of Mosquito Joe back in 2012. Kevin went out and raised capital to make sure that we were well-funded from day one. What that’s afforded us is the ability to make strategic decisions rather than checkbook-based decisions. That’s number one and that’s a testament to Kevin.
The second thing I would say is we have a truly data-oriented culture here. I shared my background a little bit before, but the first company I worked for, we ended up selling to DuPont. I worked for DuPont for a few years, then I worked for an over $4 billion credit union. I had better access to data here than I ever did at either one of those places. We can share that data with franchisees.
It’s one of our core values. We call it act with purpose. What it means is that let’s bring data to the table when we make decisions collaboratively with our franchisees. That leads to another point the culture of our organization. We have a set of five core values that we live by. It’s not stuff that’s on the wall. It is on the wall when people come here for a meet-the-team day or to visit us. They do get to see it but one is leading with integrity. That’s about putting the franchise first.
Being curious and innovating is another. That’s constantly looking down the road because we feel like it’s our job to be at the forefront of what’s going on, whether it’s in the pool business. The agent gets out of swim on the holiday lighting business or the home cleaning business. We need to know what’s coming down the pipe. Finally, we have to empower and serve. That’s around the leadership and the service mentality toward our franchisees. Along those lines, we want a ton of awards for being the best place to work. Not just local ones but outside magazines and a lot of other ones.
We create a culture because we need to know that supporting franchisees isn’t a Monday through Friday, 8:00 to 5:00 type thing. Particularly in our business. That’s when we do all the billable hour work. We have to support franchisees at night on the weekends and we got to take those calls. We feel like creating a great culture is going to allow our employees to feel great about supporting franchisees when they need to be supported. I mentioned acting with purpose.
Finally, our fifth core value is having fun. It starts with creating a fun environment for people to work in celebrating the successes of our team members and our franchisees and looking for opportunities to have fun. We do a great job of that as an organization. We try and push that to our franchisees because, at the end of the day, franchisees have to create their own workplace culture because they’re hiring people and they’re creating a team. It might start out, this is always the way I describe it to a new franchisee or perspective.
I’ll say, “You’re going to hire that first technician and you’re literally going to meet with them at a Starbucks or somewhere. You’re going to sit down in front of them. You’re going to be wearing your Pool Scout shirt and maybe you drove your Pool Scouts vehicle there. You’re going to be selling them on wanting to come to work for you because you’re their first technician that you’re hiring.” If they don’t feel inspired and feel like you’re going to create a great culture. They’re not going to come work for you.
It starts as early as that, then as mature as Tiffiny and Raleigh have 30-plus employees in our organization, the different organization than it was when she hired that first technician. That cultural side of things and having fun is important for the franchisees as much as it is for both franchise brands here. We do a great job of retaining people, hiring great people from around the country, and bringing them to Virginia Beach in many cases. It’s a fun place to work. We all share a higher purpose here of our core values of what we have there and the franchising model in the beginning. You’re in business for yourself, but you’re not by yourself. We preach that but it’s true. We’re all behind our franchisees to help support them.
If you aren’t fired up after hearing that, I don’t know what gets you up in the morning. What I loved about what you said, at the end of the day, it’s objective. It starts with data. There’s sophistication, process, and appropriate capitalization. You go down the list but when you make it objective, which you’d mention more data than your previous careers. Those were some pretty incredible organizations.
Now you’re coaching and creating benchmarks that your franchise community can collaborate around. To your point, to have fun, I’m sure you have plenty of leaderboards. There’s that collaborative aspect, but in making it objective, not only can you elaborate on best practices but to your point, they can be celebrated. You can see the incredible sophistication and it’s not the process. It’s the people and Buzz Brand certainly has it all.
Michael Wagner, I can chat with you all day but I won’t do that to you. You have an incredible organization to continue growing and serving. It’s clear that your organization does that. You serve. I know that the CEO is serving the support team and the support team is serving the franchise partners. Those franchise partners are clearly doing a great job of serving customers. They’re only being provided more value points, and revenue streams for customers so they can build their empires. They can live out their American dream.
Michael Wagner, thank you for your commitment to the franchise space. It is certainly important work. Thank you for demonstrating what entrepreneurship can look like when done responsibly and the right way. If anyone would like to get in touch with you and learn more about your incredible organization, how can they do that?
You can find us at PoolScoutsFranchise.com, which would be one area. BuzzFranchiseBrands.com is our organizational website where you can find information about any of our brands there. I’m certainly on LinkedIn. You can find me there. I’d be happy to talk to anybody. This is our passion and I always start out by saying, “The pool business and what we do isn’t necessarily a sexy business, but for me, it’s super sexy because of the things I talk about and the passion that our team brings to it every single day.” Being part of such a great organization is a blessing for all of us. We walk the talk when it comes to showing care for our franchisees, which makes a difference at the end of the day. Nick, thank you very much for the opportunity. I’ve enjoyed the conversation.
There is certainly nothing better than changing lives and impacting communities and that is entrepreneurship. That is the beauty of the franchise industry. Clearly, you have a thought leader helping us level up here. I certainly have. I would appreciate it if you would hit that subscribe button, like the video, and drop a comment. We would love to hear some of your thoughts. Clearly, some incredible nuggets of wisdom dropped. Please follow and subscribe, but as always, level up.
Michael Wagner, the President of Pool Scouts, was born in California but grew up a military brat who lived in many spots and traveled around the world. Michael graduated from the University of North Carolina at Greensboro with degrees in Economics and Spanish. Prior to Pool Scouts he worked as the Corporate Sales Officer for Chartway Federal Credit Union. Before Chartway, Michael was the Global Client Services Leader for DuPont Sustainable Solutions.
He held multiple senior leadership roles for Coastal Training Technologies Corporation (acquired by DuPont) over a 19-year career. As the President of Pool Scouts, Michael oversees the business and works to drive growth and ensure franchisee support. When not working hard to set new benchmarks for the pool cleaning and maintenance business, he enjoys traveling around the east coast with his wife and two children for soccer games and training sessions. He also enjoys soccer, surfing and time at his own pool with the family.