Adam:
Welcome to the franchise consultant podcast. I’m so excited to have Ron Luster on today. How are you doing today, Ron?
Ron:
Well, in this day and time, I guess we’re doing okay.
Adam:
Great. Well, I’m so excited to have you on and one of the reasons why I wanted to have you on is you have a really, really interesting story. Would you mind telling our listeners a little bit more about your background? Okay, well
Ron:
I’m a native Houstonian, which is in these days is a little different. But I was raised in Houston, went to Baylor for college, and then out of college work for a couple of years in industrial sales. But I had a background My father has been in the insurance industry for 15 years. I had one of my majors in college was Rich Management Insurance. After a few years out of college, I made the jump into the Insurance Brokerage world working for a company called HR h which was a Nationwide Insurance broker and learn to cut my teeth on the Employee Benefits side.
So health, what that entails is the main thing is health insurance, dental vision life insurance disability insurance. Ah, there. We were HRH from 2000. Starting in 2000 2008. We were purchased by Willis is now Willis Towers Watson to a global insurance broker. Things changed when you when you’re bought by a large organization and in 2012, so 12 years into my career, I decided that I wanted to have the opportunity to have the seat at the table and be an owner in a smaller firm. I figured I realized that I was much more entrepreneurial I wanted to kind of make my way.
So, in July of 2012, I left and went to ensure point, which has been around since 1972. And the majority of the company is called Commercial Property and Casualty. So, instead of the employee benefits in terms of the company, you’re going to liability, your umbrella coverage, your vehicles, your buildings. I came in and one of the owners my father had been the mentor to, since 1981. maintain that friendship. His name was Jim Frif. Unfortunate Jim passed away almost three years ago, prostate cancer.
Jim was a great additional mentor to me, just like my father had been to him and helped me understand the difference between being just a what we call a producer in the world of insurance, where I’m kind of a sales guy, to also learning how to be one of the owners. Think like an owner to think bigger about your employees, we have about 30 employees in total. So that was the big switch and then so since then, I’ve been there almost eight years or eight years in July. And it’s been the best business decision I’ve made.
From that standpoint, my typical client along with triplets typical client, small to a medium-sized business that is family run in commercial construction, oil, and gas field service. Manufacturing is the majority of it. So the funny line that Jim always had “Jimisms”, he had funny lines, and one of the things that he liked to say was when our tagline is, you know, we’re not chasing women’s clothing store. We like hard to place redneck business because our staff is as strong as bad breath.
Adam:
That’s great. Yeah, so
Ron:
That was it. So our typical client is, you know, they are a field service these guys wear boots and jeans. They’re not in a tall skyscraper downtown. They’re out in, you know, out in the field employees are out in the field, a lot of them wear, you know their name on their shirt. And we like that. Because even really smart people that run businesses do not understand insurance, nor should they, they should have a grasp of it, but the details, that’s what, that’s what our job is to advise them.
Adam:
So, Ron talk a little bit more about your entrepreneurial journey. You’re working for this company in 2012. And Willis, then you make this decision that you want to go ahead and kind of make a leap to a smaller firm, what kind of like things went through your head and just walk through that because that’s it. That’s kind of a big, big deal.
Ron:
It was how you’re, you’re so right that that was for me, at that time I was. My wife was working part-time we had two kids, we now have three. The financial thought of making that jump was the scariest. I knew that and I have insurance we normally have two-year non competes, which means I could not solicit my current clients for 24 months.
So I had to make this jump. And I wasn’t going to just take my clients and then go to litigation, I decided that wasn’t going to be the right path. So I had to prepare financially, where I interpreted by nature, but I had to roll up my sleeves and cut costs and we had to make family sacrifices in terms of what we could do what we couldn’t do. It also once I’ve made the jump Within two weeks, I realized that it was the best thing I’ve ever done. Because I was not built for corporate America.
And I had this renaissance of, I guess of energy in myself to go out and why am I not the peak was getting forced to go out and I just had this extra positive energy. This was also during the time of healthcare reform. So a lot of companies were looking, for advice on healthcare for him. And honestly, there were a lot of people in our business that weren’t giving the correct advice. And I was just more honest, and we gained some clients because of that. S
o it gave me some momentum during that time for the office to refocus so entrepreneur-wise, how it helped me was I had to cast aside a client base that I had worked with the first 12 and a half years of my career. It starts over, but it helped me focus on What I had started from the basics, what I started from, you got to pick up the phone, you have to be educated on what you know about the business. You have to be consistent and persistent a bit, calling a company and just tell them, hey, I’d like a puckering church program.
Everybody’s gonna do that, using technology using LinkedIn.
Using the World Wide Web. If you want to look up a company, don’t just look up their website, try to find out who the decision-makers are. I don’t look for a connection.
I used my connections.
So I have an upgraded part of LinkedIn, which I highly advise anybody that’s going into an entrepreneur-type environment, to get the upgraded version of LinkedIn, which allows you more access. So if I had, if I was trying to talk to Joe Smith at ABC Company, I would see on LinkedIn, and if they were on LinkedIn, and I had a common contact I would assess whether that common contact is somebody that I just met at a networking event or if it was somebody that I know. And I would reach out to them and ask them what their relationship with that person is.
And if they’re willing to give an introduction, that worked pretty well. At least you’re going to get an honest answer out of somebody that has referred you or that you’ve you’ve been saying, hey, just myth. I’m calling you you have we have a common friend in Adam Goldman, then he said it uses my I could use his name, because y’all are friends, and asked to just go through the questions. And a lot of times, it’s a lot more refreshing that they put down their guard, a lot more honest. And then they said, Man, we’ve got a guy or gal that we love. They’ve done a great job of advising us.
And I said You know what, that is exactly what you need to know. Or, man, I’m so confused about all This, and our guy or gal has not come out and laid it out to us. They essentially say that healthcare forms going to be repealed. And at that point, then you know, you have an opportunity to go meet with them and if nothing else, just educate them on your product.
What you consume the service that you provide in an entrepreneurial way, you have to know your craft. That is a big part of you can’t just be a generalist, you have to be knowledgeable about your product. You have to know how it operates. You have to ask a lot of open-ended questions because each company say from an insurance standpoint, I have six electrical current commercial electrical contractors whose clients, ranging in size from about 15-20 employees to 200.
A lot of these things the Same companies chase the same business. So they’re going into if you’re gonna build a building from the ground up, they are the ones that are bidding on that project. Two of them may have completely different insurance programs. It is truly based on the personality of the decision-makers is what it comes down to. Not really as they will know what their competition has. But it comes down to what they believe. So one size fits all is not going to work. The biggest thing my father taught me, his son, you have two ears and one mouth, use them accordingly. So, when I say that, and that a lot of times, I would write that expression on the top of my notepad.
If I would, I would always go out with a series of handwritten, open-ended questions that I wanted to ask. Mainly, I wanted to get the client or the prospect comfortable talking about themselves about their company. I didn’t want to go out and spew about myself or our company. Getting people to understand, you know, talk about their own company is it gets them loosened up, it gets him kind of excited. It’s great to entrepreneurs that you’re you’re pursuing. So always do your research. When you go out,ask a lot of open-ended questions.
Adam:
That’s great advice. And why don’t you explore a little bit more about or let our listeners know a little bit more about why corporate America wasn’t for you?
Ron:
Well, when it when we were HRH each office ran themselves kind of economists like you were allowed to go pursue the business that you wanted to pursue. I liked that small to medium-sized company. When I saw saving small to medium-sized small would be a 10 employee for me medium-sized see a couple of hundred employees. And when Willis purchased us their business model was to go after the upper-middle market to large companies.
So they essentially came in and said, Hey, we purchased you. Hey, thanks for the revenue that you give us.
Yet, we do not want you to pursue any companies that are below this certain size or revenue threshold. So, a 200 employee company was about the minimum that they wanted us to pursue. So my comfort level with going after large companies did not exist. I didn’t enjoy it. I kind of forced it on me. I liked rolling. I like rolling my sleeves up and dealing with the owner of the company, or its family-run you’re going to be dealing with an ownership back committee. The bigger companies you get into you have layers of management where you’re never going to get to that ultimate decision-maker. And that ultimate decision-maker may have the person that’s bringing it to them, which is not me normally may have may not agree with what I’m bringing to the table, they have their way of wanting to do things. A little bit of politics involved, and that’s just what I was not comfortable with.
I like that type of company that’s been around a long time, they’ve weathered storms. We become you become friends with them, I know where my sweet spot is, and unfortunately when Willits purchased us, and I began to be part of their culture, the culture didn’t fit me as well. But also what they were asking me to do was not in my comfort zone. And that started to affect me, not only from a business standpoint but from a personal standpoint, personality-wise, wasn’t happy. It’s not going to get to Willis. Their business model is very successful.
It just wasn’t me. And what I needed was something which means to enter that diving board to jump off, and it just finally came down to. I knew that I was at the stage where I was just not happy. Not happy at all. And but I realized I liked being an insurance guy.
And I had a great opportunity in the thing that I did that was entrepreneurial of myself going into a company that was already in existence in SharePoint. But one of the things I said was, listen, I want to have the opportunity to be one of the equity owners. I don’t want to be just an employee. And there were that was my line in the sand. Because there were a couple of companies that wanted to pursue me but they didn’t want to make they were wishy-washy on making that offer to me. I was not in my personality I didn’t, you know, entrepreneurs, a lot of times they want to go charge and do it on their own by themselves.
I’ve always liked the team, because I know what my strengths are, but also very much know what my weaknesses are. And that is probably the most important thing I learned was what I am not good at. I need to hire somebody or have people on my team or good because it can bog you down and drive you nuts if you’re having to do things that you’re not good at. So that that those are lessons that I believe this is my 21st year in the business. I’m 46 years old. I had a lot of hair. When I’m starting this business and my youngest has never seen me with the hair on the top my head now. So it’s been quite the ride.
Adam:
So So I mean, you being insurance industry, you probably have a very good sense about which businesses are doing well and modeling right now.
Ron:
Yes
Adam:
I guess my question for you I know we don’t no one has a crystal ball. But if you were to look into the future over these next three to six months or nine months for someone that’s potentially looking to start a business, any ideas about which businesses you think are good, and which ones you think will struggle for the next year or two?
Ron:
Good question. So the good businesses, that will be good, it honestly is what we do in the Insurance Brokerage world. If you know, we get paid a commission monthly based on our clients paying their bill. Now the whole goal is As you spread out that risk, what my thing is, the advice is I used to have a lot more energy-related clients have more construction-related clients.
Now it just morphed into that. I would say, spread out your, your client base in terms of your industry base. Because if I wasn’t a hundred percent energy right now, which there are a lot of people out there that are in the insurance business, they are going to be hurting much more than if you have diversified your risk.
Construction, the commercial construction industry is still doing very well. Six months from now, they may have a dip in it because projects have been put on hold that may be starting in four or five months. My brother’s in the business season, the commercial construction business and he has four jobs that are active right now. But he did say that given those three or four months from now, there’s A lot in the pipeline manufacturing, if it’s energy-related, you’re going to be suffering.
Service industry, I believe that once COVID is finally over, the service industry is going to come back people want are social beings by nature, even if someone is a little bit shy, even wants to get back out. Now we’re the way we get back out, it’s gonna probably change but you know, people are gonna want to get out and go entertain and be entertained and go on trips.
So I think the service industry has an easier way to bounce back because there’s not a lot of overhead. As much as manufacturing or oil and gas. We have very expensive equipment that you have to maintain and pay for.
I am an eternal optimist and I’m in the energy industry is what I grew up up in here in Houston, I sincerely hope that the will of the independent oilman and woman will find a way to come back. It just pains me because of it as overshadow what Russia and Saudi Arabia had done to drive down the price of oil. And now that we’re not driving it is made it even worse but diversify.
As I said, I looked for a size. I tried to find companies that had a lot in common with me, the internet, you know the world, you can find out a lot about people based on social media. So, I like to hunt and fish. I like to play golf a little bit. Well, if I find a prospect that likes those things, too.
Well, I might be more apt to have a discussion about that within the loop. A month, if that’s if we’re a better-fit people like doing business with people that identify with us.
That’s a big thing.
Entrepreneur-wise, in finding vendor partners in the future with COVID, you’ve got to find two vendor partners. I’ve got a payroll company here in Houston-based payroll company, not a nationwide one that I work with a lot of CPA firms. We’ve got a couple of those we work with companies that do these bankers that people you know, vendors that are dealing with the same buyer that I am, which would be an owner, CFO, controller, HR person. I try to identify other industries that are talking or dealing with those types of companies. And it’s a lot easier to be referred to a company by one of your one of their vendors then knocking on the door.
So, a lot of times it’s a lot a try to work smart, you can work harder, you can work smart. Working hard is important, but working smart
is a better way to do it.
Adam:
It’s a lot of sense. Oh, we both know a lot of people that have been affected by COVID. I presume that you have a lot of people in your network that have somehow lost their jobs or furloughed right now or maybe even look something is that?
Ron:
Yes, most of you know I, have. Some of our clients have been directly affected. We had one will field service client that is on the front end of the drilling operation. They went from 180 employees on March 1, they have 45 employees today. They lost three-fourths of the workforce in a month. So but those are the employees that they lost or They’re the field service guy. They’re the guy that has the name on their shirt, hourly wage guy. And they’re mostly guys.
The service industry, a lot of I think the PvP the paycheck Protection Program has insulated a lot of the layoffs of some of my clients because they are going to put that money that they receive towards keeping their employees on the payroll. They’re much more conservative and they want they know they don’t want to lose their employees. So I haven’t seen a lot of getting laid off. Now.
You have my friends that are with bigger corporations, that I believe that we’re going to start seeing that fall off in the next 30 to 60 days if things don’t improve. Like I said, the majority of my clients, they are hardcore about being their employees because they know that is probably the most important part of their business that they have is their employee base.
Adam:
So for someone potential for something else on now and look in 2012, you leaped. It’s not your choice to make that leap. What do you say to someone that now that somehow was looking to pivot in this account? Yeah, start business advice would you have for them?
Ron:
And that’s a great question. So I struggled before 2012 with you I want to stay in the insurance business or do I want to get out of my mind was a little clouded with my, you know, I was, I wasn’t happy with who I was with. That also bled into my happiness in the church business. What I realized is I like what I do. I love me and I love being an insurance man. In my blood, I love doing it. And that blossomed once I went to ensure point again, I was like I had a revival of it along those lines, People that are looking to do something different do make you feel passionate.
You know if you are passionate about having a flower shop, the money will live in but you’re worried about the income part. If you’re passionate about it, the money will come. If you are passionate about a bit of baking your whole life, but now you want to consult companies that have been your client on there, you know, but you don’t want to be a banker anymore. You want to be more of a business consultant because you’ve seen them.
If that’s your passion, chase it. The business will come.
Anything that you do, if you have passion in a drive, the business will eventually come.
Back that’s probably my biggest piece of advice. You get a wake up happy every day. I wake up going, man,
I’m excited about the day when there issues within the business. You have a bit of a passion for fixing him about fear instead of just putting it to the side. And you know, putting a piece of paper but I’ll get to that later. Passion is something that can never be replaced.
Find your passion and what you want to do, and chase it gonna be a scary read.
That’s great advice.
You know, that’s, that’s my biggest piece of advice it by me leaving and going into SharePoint. It helped improve my marriage, my friendships, and being a dad because I realized I was happy in my McLeod’s part, it was happy again. That hasn’t changed.
Adam:
That’s great advice. Whenever I have my guests on the show, I give them a chance to, for people to get ahold of them. No Get a hold on if someone wants to contact you, how do they contact you?
Ron:
Good question. There are a couple of different ways so obviously yeah, the old school phone number, my direct phone number is 713-964-0010 or my email is rluster@insurepointe.com.Or you can connect with me on Facebook, on our Facebook. LinkedIn is another way. That’s a great way to connect. Now, if you want to connect to me a little note, I get a lot of people asking me to connect that I have no connection with. So like I said when I’m trying to connect with somebody on LinkedIn Make sure and say I was referred to you, or I was told to connect to you by John Doe.
Adam:
Great. Well, I appreciate your time today. Ron is always a very nice chatting with you and great to hear your perspective and thank you so much for being on our show,
Ron:
Well, I appreciate the time, Adam and, you know, entrepreneurs out there Best of luck. You know, this, this, this is a journey. If what I had to learn and accept was if I’m just trying to chase the almighty dollar. That is not the journey. That journey isn’t going to be as fulfilling as just trying to be happy. You’re happy. All of it comes in the future. Really does.
Adam:
Great stuff. Ron. Thank you so much.
Ron:
Thank you. Thank you.
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