Franchise QB

Episode 83: Canopy Lawn Care- Hunt Davis (CEO), Ben Wright (COO) and Jack Humbert (SVP Franchising)

• Mike Halpern • Season 1 • Episode 83

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In this episode of the Franchise QB Podcast, host Mike Halpern discusses the journey of Canopy Lawn Care with its leaders, Hunt Davis, Ben Wright, and Jack Humbert. They explore Hunt's move from finance to entrepreneurship, the importance of agronomy in lawn care, and the unique offerings of Canopy Lawn Care. 

The conversation highlights the competitive advantages of the business, the role of AI in enhancing operations, and the ideal profile for potential franchise owners. The episode concludes with insights on investment opportunities and market expansion plans.

Takeaways

Being a business owner can be fulfilling.
Understanding agronomy is crucial for lawn care success.
Empower Brands supports franchisees with a people-first culture.
Canopy Lawn Care focuses on eco-friendly lawn treatment solutions.
The lawn care industry is a $150 billion market in the U.S.
Canopy's competitive advantage lies in its proprietary lawn care program.
Franchise owners can operate as owner-operators or hire managers.
AI enhances efficiency in pricing and customer engagement.
Cultural alignment and entrepreneurial spirit are key for franchise success.

https://www.canopyfranchise.com/

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Contact me and my team with any questions along the way. www.calendly.com/franchiseguy
Mike Halpern, CAFC
mike@franchiseqb.com

This is the Franchise QB Podcast, where we empower entrepreneurs to win big in franchising. We huddle up weekly to educate our audience about the most successful small business model ever created, franchising. Welcome to the Franchise QB podcast. I'm your host, Mike Halpern, a 20 year industry veteran and entrepreneur. My mission is for listeners to achieve their American dreams of creating wealth and independence through franchise ownership. Every week we speak with franchisees, franchisors or vendors that support the industry. Thank you for joining us and let's get started. Joining us in the huddle today are Hunt Davis, CEO at Canopy Lawn Care, Ben Wright, COO at Canopy, and Jack Humbert, SVP of Franchise Development at Empower Brands. Welcome to the show, guys. Thank you. Thanks, Mike. Glad to be on. Yeah, glad to have you guys here. So let's start with you, Hunt. You spent the early part of your career in finance and private equity. Then in 2015, you decided to start a lawn care business. Take us back to 2015. And what led you out of finance into business ownership? Yeah, it's a great question. It would be a multi-day answer if I, if I responded in full, but, um, my background before that, I grew up in my family's business. My, my father owns, uh, uh, what is now a retail garden center. What was then a farm supply business when it was founded in 1910 and he bought it in 1976 and I grew up there. So I grew up. just loving business and I'm an engineer by birth and by education. And so I just have this wiring to want to solve problems and build and create and grow something. And so as a banker, you're really an advisor. You're on the sidelines and there's this really cool game being played that, you're, uh kind of on the outside looking in and really wanted to solve a problem, build, create and grow something. And, um, you know, I've, looked across across industries as many, you know, people that we that we talked to who are interested in being an owner do. And, you know, I just I became highly attracted to the home services space. Right. It's a huge industry that has lots of demographic trends in its favor and a lot of opportunity. And, you know, from there, I really was just drawn to, you know, in home services, you can kind of create two buckets of companies, transactional businesses and recurring revenue businesses. And they each have pros and cons. They each fit with different oh owners better. And I was really drawn to the recurring revenue side. And, uh you know, as I kind of pared down my criteria, you know, I landed on, lawn care, as we call it. We also refer to it as lawn treatments because lawn care is not a defined term in the customer lexicon. And um just saw a lot of opportunity and a lot of ways to create a new model that competed uh well against the companies that have been around a long time with programs that have been around a long time. um you know, just wanted to go on my entrepreneurial journey. as many folks who are looking at franchising, you know, are thinking through as well. Yeah, that's really cool, Hunt, that you had that career and you decided to kind of jump in and kind of go back to your roots. So that is very similar to what a lot of people go through as they're evaluating business ownership and franchising. So appreciate that. So Ben, let's switch to you. Your education and your career has been focused in the agronomy field. And you joined Hunt and the Canopy team. tell us what, what is agronomy for those that are unfamiliar with the term and what led you to join Canopy? Yeah. Yeah. You're right, Mike. I've been in the green industry my entire career, studied landscape, horticulture and agronomy, is growing plants, living things. And, I really love it. Um, yeah, I knew I wanted to, uh, pursue a career in that space. And so I did, learned a lot have. have done a number of different things in the landscaping and lawn care realm. yeah, I, and I have been long time family friends and he and I caught up and it was pretty perfect timing because I was at a point of transition in my current job. And I just, I knew I wanted more. I wanted to be part of creating and building something uh, bigger and that had real impact on people. Um, and I knew that the industry needed innovation. So, uh, after talking with Hunt and some of his ideas for how to build a differentiated home service business, uh, he convinced me. And so I just jumped right in and really haven't looked back. Very cool. Well, thanks for the context. Um, and then Jack will turn to you. So you're the franchising arm of the outfit. Um, you know, like Hunt, you spent many years in the banking industry. and then got into franchising through a financing concept about a decade ago. Tell us a little bit about your background in franchising and then how you discovered Empower Brands, which is the parent company that's doing the franchise development for Canopy. Yeah, I spent about 15, the last 15 years leading growth and development for franchise systems. you know, I really think that years prior to that in the financial industry has given me a unique perspective franchise ownership, both operationally and financially what it takes to succeed. I think with Empower Brands, the people first culture is really what drew me to Empower and really just the owner focused support. ah When we say championing the success of our franchises, it truly is our number one focus. uh you know, that the culture between Empower, Canopy and our owners, uh you don't find everywhere. Yeah, very cool. Well, thanks, Jack. And before we jump into all the kind of aspects of the Canopy brand, uh I'd like to kind of educate the audience a little bit about the Empower Brands franchising platform. Can you tell us a little bit more about what Empower does to kind of help its partner franchisors expand and flourish? Yeah, yeah. So Empower Brands is one of the the largest home service platforms in the franchise industry. have 10 brands, all at different stages, which is really neat, a stage of growth. uh Right now we're supporting about 1,500 territories, over 700 owners. uh what is really special in Hunt & Ben, our examples of this is uh we have six brand founders on the Empowered team. uh And I think that really, really stands out and it really continues to keep us owner focused. And uh you add to that our 200 plus support team members, uh including IT, accounting, marketing, onboarding, uh we take that support to the next level. Yeah, I think you just answered my next question. think. One of the benefits of being in a platform franchisor is the shared services that a franchise owner within each of the portfolio brands gets to enjoy. And you just touched on some of those things. Anything else from a shared services standpoint that we missed? Well, I would just add to that, here at Raleigh, we have the dedicated Canopy team. so on our team, there's Ben and myself. We also have Mike, who's our director of agronomy. He oversees all of our lawn care program. And then we've got uh guy named Scott who oversees all of our marketing. And so for the owners, it's really a best of both worlds. So we have a dedicated team with functional expertise that you know, we, we, we're the first line of support for all of our owners. And then we have this pool of shared services on top that, you know, we can get help from, or the owners can. And so it's really, you know, a great combination of, uh, you know, small team, hands on support coupled with large team, lots of resources and experience. Yeah, sounds great. Sounds like a win win. So, tell us a little bit about like, when did you actually launch the Canopy Long Care business, alongside Ben and when did you decide, okay, we have this figured out, let's scale it, let's franchise the model? Yeah, that's a great question. Well, going back, uh we launched Canopy in 2016 and uh as is the case with every entrepreneur, I've ever known, you know, there were, um, uh, you know, crossroads along the way and, you know, rarely do you finish up with the business that you started out with. And so for us, we actually started, uh, Canopy in 2016 as a landscape maintenance business. Okay. And we thought that that was, that was the vertical that we were going to solve for. Um, and so we, we set out on our way, um, what we discovered along the way. And this is how Mike comes into the picture. uh We were doing lawn care more of the traditional way. Mike joined our team. Mike has an incredible background. went to the number one turf science school in the country, took care of the grounds at the Washington Nationals and UNC and the Durham Bulls. And Mike had kind of designed and developed a new model and a new way of doing lawn care. Mike joined the team and we started doing you know, this new program internally just for our maintenance customers. Well, the results wound up being way better than the other results. And by the way, it's way better for the environment, the way that we're doing it. And we started getting inbound calls for just our lawn care program, which we didn't offer. along the way, we had this great epiphany that the lawn care business was a much more attractive business to us. It requires a lot less labor. It's much simpler. and it's got better margins. And we were proving that we could compete well in the marketplace with this new model. People latched onto the better results. They latched onto the more sustainable and eco-friendly nature. A lot of people have kids and pets and they care a whole lot about what gets put on their lawns. know, a lot of people are much more conscious about what they put in their bodies now and the supply chain and things like that. And we saw a big opening. uh you know, that we could exploit. And so we pivoted our business. We spun out the landscape business as a separate business, separate brand. Canopy is just the lawn care or lawn treatments business. then in 2023 is when we began franchising it. And that was really driven by, we knew that we wanted to create a model that we could scale across the country. And there's a few ways that you can do that, right? You can organically grow in all these new markets. You can acquire businesses in those new markets, or you can franchise. And franchising was a strategy that we liked. And, you know, that for me connects back to my origin story, which is growing up in my family's business. And it's a small business, but it has had a meaningful impact on my personal growth and development. And, uh, I've seen what it has done for my family and I love business ownership and I believe in local ownership. Um, and, uh, and giving people opportunities. Yeah. So when did you guys actually franchise? that 2022 or more recently? 2023, 2023. Okay. So that kind of transitions into my next question for Ben. Um, what exactly does Canopy lawn care do? Like if I may, end user consumer and I'm kind of shopping for ways to make my lawn look beautiful, but do it in a responsible way. Tell us a little bit about the service offering that the franchise owner provides. Yeah, it's a really important question and Hunt has already alluded to this, but first and foremost, we do not mow grass. Okay. We we grow grass. We create beautiful, healthy lawns through a proprietary recurring. lawn treatments like fertilization, weed control, soil nutritionals. um And then we also offer supplemental services, other agronomic solutions like aeration and overseeding, disease control, tree and shrub fertilization, and a number of others throughout the season in addition to our recurring lawn treatments. Yeah. And I like that because all those different applications makes it a year-round business in most markets. So it's not like... There's this huge seasonality to it. So how big is this industry that we're talking about? How big in the United States is this industry that you guys compete in? Yeah, it's a huge market. You know, here, here in the U.S., people love their single family detached homes, you know, with their lawns and, uh, you know, it's a, it's a $150 billion industry or so it's a, it's a, it's a large industry and growing. Yep. So it's a large, large industry. There's a lot of competition in it. Um, so let's kind of take it to the next level. Like what are the competitive competitive advantages that Canopy Lawn Care offers? It kind of differentiates you guys from the pack. Yeah. I mean, really our main competitive advantage is the proprietary, uh, lawn care program that we've talked about, which really kind of flips the script. Um, visa V. traditional lawn care uh programs where we take a soil first approach. So our program really starts below the surface in the soil because that's where uh true lawn health begins. And so we use proprietary blends that include uh repurposed coffee grounds, which no one else does, corn gluten, probiotics, amino acids, sea kelp, things that you would never read on a fertilizer label uh that other lawn care providers offer. And so, ah yeah, we're focused on building healthy soil, not just feeding the grass and killing weeds. Yeah, so you're taking a really thoughtful and scientific approach to, you know, not just like making the lawn beautiful, but like the impact it has on the neighborhood, the lawn, the world, that kind of thing. that's exactly right. By the way, it also delivers superior results. So better results, um more resilient lawns that really put our customers on a path to uh sustainability where over time we can reduce the amount of synthetic inputs, other inputs like water. And when pests come in, when disease comes in, when these pressures come in, our lawns are more resilient to. withstand those and we don't have to keep dumping uh synthetic inputs in there to keep them healthy. Yeah. No, I love the recurring model. I love the kind of thoughtful impact that has on our planet. All of that I think is really interesting, especially for someone that's considering, you know, becoming a franchise owner in this space. So, hun, tell us a little bit about the ownership model. Can someone come in as an owner operator and kind of be a hands-on, you know, owner and can they also do it in like an executive role with a GM? Like how does that work within your system? Yeah, that's a great question. And it's interesting as you look at our at our current owners, they run the gamut from owner operator doing everything to start. We've got some owners that own another business. And, you know, they're expanding, you know, and adding on Canopy and they may even have some shared resources between the businesses or co located. And then some are, you know, have a corporate job and they've hired a, you know, a GM to run it. And so the business does work well, uh you know, in, in both models. Okay. And we, you know, we, we, we welcome, uh we welcome all. you know, who would be interested. Great. So what does the labor model look like in both scenarios? When you launch this business, you go through training. What does your staff look like as an owner operator? And I'm imagining that you're just adding in that layer of management if the owner's not actively involved. But how many guys are we talking about? How many vans or trucks are we talking about? What's that look Yeah. So if you're going to be an owner operator and your time is going to be dedicated to Canopy, you don't need any employees. You can run this business starting by yourself. um If you have the GM model um or if you have another job and you don't have all the time, um you really hire one person that can wear multiple hats, that can uh do the sales, the marketing. uh be your first technician fulfilling the work, uh some of the admin stuff. But that's part of the beauty of our model is uh it requires very little labor. uh We have big service windows, typically it's six to seven weeks per application round. And so, you you can fit three, four, customers in one of those windows. And so uh until you build up to 400 or 500 customers, you've got capacity with one technician. uh And so I think Jack can speak to some of the numbers when we talk item 19, but it requires very, very little labor. I will say that uh it's really important with your first hire as you're launching your business to make sure you're focused on hiring somebody that can really do business development, who's focused on growing the business. ah That is the most important part of what we do and in launching your business, that should be the primary focus is building that book of recurring revenue customers. Yep. And I also liked it. I mean, your model, you're not going inside someone's home. So that kind of brings people's guard down a little bit. They're a little bit less, you know, concerned about people outside of their property than inside. And also from a timing standpoint, you know, you can schedule them. in a window, like you said, it doesn't mean you have to show up at 12 o'clock on the nose to perform the service. The customer is probably less concerned if you get there at 12 or 1230. As long as you come, you get the job done right. You do it within a window that you promised. So I think that gives more flexibility for the owner to kind of build a bigger business and get a lot of appointments, you know, on that recurring revenue track. Yeah. Yeah, that's exactly right. There is a lot of flexibility within uh the operations and the day to day production. of the work. Yeah. So what is the day in the life of either the owner operator or the technician? Or they, you know, have their route and they kind of build that route and they go out there and drive it in a kind of predictable manner. What's it look like for someone that's going to be out in the field doing the work? Yeah. Once you, once you have an established business and you have technicians who are just dedicated to uh production, yeah, they, will have a route uh and uh tablet, iPhone, that shows that route. can click into the job, see exactly what they need to do, navigate to the address, um let the customer know, them a text that they're on the way, show up, perform the work, and uh move on to the next one. We like to incentivize technicians to uh also do that business development. That's an important part of their role. So asking for... Google reviews and asking for referrals and doing the service and knocking on the neighbor next door, talking to the person walking their dog down the street. uh We like to say that Canopy needs to be a sales organization. So technicians need to have that mentality uh that they are part of growing the business. OK, so yeah. And then do you require some type of warehouse space to kind of store the materials, the equipment, or is that all stored in the vehicles? What does that generally look like when a new owner launches? Yeah. When a new owner launches, they need very little storage space. uh Some of our owners have, you know, as small as like a 8 x 10 storage unit where they store their supplies. So it can be as small as that instead of having full lease at a industrial site. Yep, that's right. And uh the vans also do store a lot of product as well. So there's a lot of uh storage area in the vans. Very cool. Yeah. So Jack, let's turn to you. um How many franchisees are currently in the Canopy system and how many territories are currently operating? Yeah. Yeah. It we have 13 franchise owners right now. Okay. And uh And that number, if you ask me next week, we'll be higher than that. And then we obviously have some corporate locations represented in our Item 19 as well. We have 40 territories and growing with our owners. A territory, Mike, is about 45,000 single-family homes. But we actually, every market's a little different. we will take a deeper dive in the demographics of the market and make sure that we're doing what's right with the owner to uh provide long-term opportunity for success. It's not a flat number, but we based off 45,000 single-family homes. Yeah, very cool. So you have a really tried and true flagship. You're already on your way with... a dozen plus owners, lots of territories. So you got kind of proof of concept from a franchise standpoint. um One question, hon, I forgot to ask earlier is how do you guys use AI to differentiate yourself from competitors? I know AI is the big topic. Everyone's trying to figure out a way to let it enhance what they do and kind of just make things more simple. But how do you guys use that in your business? Yeah, yeah, yeah. Good question. AI is certainly the word of the day. You know, our philosophy on AI is that we want AI to supplement the humans, not replace the humans. And so we've incorporated AI into our sales process. um We've got so our tech, uh prospect, you know, fills out the form on our site, then that goes and pulls an aerial image. of the customer's property. not satellite, but aerial tire resolution. We can get it during the winter time when there's no tree foliage and AI does a pixel by pixel image analysis to measure the square footage of the lawn. And that's the only input that we need in order to price our services. And each of our owners has their own pricing model. We don't dictate that. The owners need to have ownership of how they're going to price in their market. But the computer can take the square footage from from AI matched up with the pricing model and send a quote to the prospect, you know, within a minute or less. oh And so it's very efficient. what we have found is that efficiency is great as you're growing and scaling. In our corporate markets, we would need more full-time salespeople if we did not have that tool. oh In the early days, it is really important for owners to act like owners and you got to make sales. And so, you know, especially as you're building your credibility in the market, oh you know, we encourage people go do site visits, call people, text them. You still have to make the sale, but it is a delight to prospects to get a quote, you know, that quickly. Hunt, are there any other AI applications that you use that you find useful for the system? Yeah, absolutely. The other main use that we've had for it is uh our director of agronomy, Mike, uh just has such deep knowledge of the program and our business model. so Mike created a custom GPT with ChatGPT and trained it on Canopy. So he's written a lot of articles and blog posts and content for our website. And he's uploaded all that to this GPT to train it. And then he spent time interacting with it and it's been amazing what it's produced. So we've been using that as an internal tool for our owners, for their employees and for marketing uh to develop sales scripts and uh elevator pitches and ask questions about the program. It's been really, really cool. At some point that may be something that we open up to customers, but right now we're using it as an internal tool and kind of battle testing it, but it's been fascinating. Yeah, that's awesome. It's good to kind of make sure you work out the kinks and then roll it out, but that's kind of a really forward thinking approach. So, are you guys looking for in an owner? Who would be your ideal candidate to become a Canopy franchise owner? Yeah, it's a good question. I like to talk to people about entrepreneurship, first and foremost, which I know you do as well, kind of independent of Canopy, making sure that entrepreneurship is the right path for you. And regardless of the business, sales and marketing is a big component of launching a business and being in the community and networking and partnerships and closing sales and managing employees and Um, you know, from that standpoint, you know, what we're looking for isn't, isn't terribly different from, uh, what others are looking for. And, you know, as I said, we've got a variety of owners who own another business or have a corporate job or are doing this full time. And, um, you know, for us, the, primary thing and it, you know, by the way, you don't need any background in the green industry. You don't have to have any knowledge of. lawns or like that's what we provide. We provide the training, we provide the support. uh You know, we like people who have a hunger to grow a business and to be a business owner. And you know, that can look a variety of different ways. But, you know, for us, one of the main filtering criteria is we're a very culturally oriented company, oh you know, in a service business, like you can win with culture. The way that you treat people, whether they're employees or whether they're customers, the way that you treat people matters deeply and you can win based on that alone. And by the way, we've got all these great differentiators. So we really look for good cultural alignment um and people who think that way. We don't care who you are, where you come from, what you look like, but you got to our values in that regard and uh treat people well. You know, we can, we can teach you all the lawn care stuff, how to run the business, but, um, you know, be culturally aligned and have the hunger to grow the business. The lawn care part is easy getting hundreds, thousands of customers. That's the hard part. And that's the hard part for any business. And, um, and so those are the main things and making sure people have really thought through their entrepreneurial journey. And it's not just a, I woke up this morning and want to be an entrepreneur. Like, no, it's a big commitment. And you got to count the cost. The rewards can be immense, but you got to go in prepared and, uh, and, know what you're getting into and be willing to have the grit and do the hustle. You know, most small businesses fail. We de-risk that by being a franchise system. Um, but at the end of the day, owners have to act like owners. And we, we actually refer to them as owners, not as franchisees, because we just love that word to be successful. takes ownership. And, you know, if you're not going to act like an owner, then we might as well make it a corporate market, but that's not what we're passionate about. And so, you know, people who have the grit and determination, um, to run through walls and to build a business, um, you know, and, our values aligned with us, that that's really what we're looking for. Yeah. It looks like you're trying to find those behaviors, like a track record of success in life. Someone that's a go getter, grit, determination, willing to put in the hard work to build their team. And you can teach them all the technical aspects of like providing great lawns. think that's why a lot of candidates rely on a franchise system. So that makes a ton of sense. So, Jack, let's kind of shift gears to you and talk a little bit about the cost to get into kind of launching a new Canopy Lawn Care franchise. What's the Item 7 look like? Yeah. Yeah. So, you know, we just talked about low labor requirements, low asset requirements and, you know, that. adds up to the opportunity to create wealth at a low investment level. And Item 7 uh ranges from under $100,000, actually $97,900 up to $185,000 uh depending on if you're leasing your vehicle, buying it, what time of the year that you start your business on the marketing costs. So uh that really excites owners to understand uh our item seven in detail and how they can create that wealth at a low investment level. Yeah, that is a pretty low investment. I mean, it's a lot of money, but relative to the franchise space, that's one of the lower investment brands I've seen. Yes. And if you really put it in perspective, you know, an owner can build a million dollar plus revenue business really with four employees and four vans on the road with the capacity of the van. So, you know, you build that like Hunt was saying, you start with zero customers and you grow from there. But It's a great opportunity for, you know, for individuals at this investment level. The Item 19 is very strong for us, We're showing 2024 with a 55.5 % gross and a 23.1 % net earnings off of our corporate stores. We have a lot of happy owners right now. They're really just going through, a lot of them are going through their first spring. And so a lot of happy owners with Canopy Lawn Care right now. Yeah, very cool. Yeah. Good Item 7. Good Item 19. What about availability? I know that because you're still an emerging brand, there's probably a lot of white space. What are some of the hot markets that you're looking to kind of recruit the right franchise owners for? Yeah. Yeah. This week we're entering Texas, so we're in 11 states right now. Yeah, thanks. We're excited for this owner to come in and uh start in Texas. It's easy for me to say Georgia, Texas, Tennessee, Alabama, right? You always hear that southeastern and that southeastern region. That is starting to fill up for us for sure. The nice thing and what candidates ask me a lot is where does the proprietary product, what markets of work and what What Markets doesn't work in and the great part about it is we have successful owners in Idaho, Utah. We have them in Utah, Michigan. I'm sorry, New Jersey, Michigan, all the way down to Miami. uh so, know, Ben and his team will take soil samples. If we have to tweak the product, we will, but it works in every any state. We're at 11 now and, you know, growing uh and like you said, a lot of white space. Yeah. Thanks for that, Jack. Very cool stuff. So anything else you guys want to add to the mix before we wrap up today? I would just say we're, you know, we love meeting with, you know, people thinking about their entrepreneurial journey who have an interest in Canopy. And, you know, we make ourselves available. ah We, you know, like to say, we really like for people to make uh sober, well-informed decisions. And so we love to answer questions and get to know people and, you know, walk through what we're doing and what they're thinking through. so, you know, I just encourage anybody that wanted to connect with us to reach out. Yeah, appreciate that. um Well, mean, it sounds like you guys are on your way. You have a business that's been around for almost 10 years and the franchise side's taken off. if anyone listening would like to connect with Ben, Hunt and Jack to learn more about becoming a franchise owner with Canopy Lawn Care, contact me at franchiseqb.com or on x @ QBFranchiseQB. I'll get you connected. Thank you guys so much for taking the time to get in the huddle to discuss Canobie Long Care with us today. You got it. Thank you, Mike. Thanks for having us. All right. uh Follow us on Twitter @QBFranchiseQB and join us every week for a new episode. See you next time.