This interview has been edited for length and clarity.

Q&A with David Royce

Nathan Chan: Long before you sold your first company, you were a kid in school who thought he wasn’t smart. What happened?

David Royce: I struggled in school because I couldn’t focus unless I cared deeply. And when you’re a kid, you don’t say, I might have undiagnosed ADHD. You say, I guess I’m not smart. But in the sixth grade, a teacher, Mrs. Luft, really saw me. She believed in me before I believed in myself. From that point forward I worked incredibly hard to get good grades.

I didn’t learn I had ADHD until I was an adult. I’ve come to see it as a double-edged sword. In boring environments it’s brutal. In environments I care about, it’s a superpower. Sales and entrepreneurship were the first place my brain felt like an asset instead of a liability.

Years later, with no Mrs. Luft and nobody watching, he had to learn to do that for himself.

NC: Take us back to that first summer in sales.

DR: I got into pest control the way most people do. Accidentally. A friend told me he’d made $25,000 the previous summer selling it door-to-door. I drove out to Sacramento, and I was horrible at first. Didn’t sell anything the entire first week. Commission only, so I made nothing. Five days straight of zeros. I watched my teammates sell one to four per day while I was basically doing free cardio all week.

That weekend he didn’t call home. He went to a bookstore, bought half a dozen sales books, and put 90 minutes of study on the calendar every day.

DR: By the end of that summer I was the top sales rookie in the entire company out of 200 reps. Not because I was special. Because I was too stubborn to go home and admit I failed. Persistence is genius in disguise.

“Persistence is genius in disguise.”

NC: You got to the top 1% of 1% in your industry. What did you codify into the training program?

DR: Three things became the spine of everything I taught. Option closes versus yes-or-no questions. We’ll be in your area tomorrow at three or five, which works better? Both answers are in your favour. Then RAC. Resolve the doubt, lay down an ace they hadn’t heard, close again in a different way. And body language. Your body sells before your mouth does. I used to tell reps, you’re not losing because your script is bad. You’re losing because your face is saying please don’t hurt me.

NC: You were on track for investment banking. What changed?

DR: My last year of college I was planning to apply to investment banks. I figured my sales skills and my finance degree would tee me up nicely for M&A. So I asked my boss for a letter of recommendation. And he goes, why would you go work 80 to 100 hour weeks for someone else when you could start your own pest control company?

I’d never considered the idea. And this is embarrassing, but my first thought was literally, pest control doesn’t sound impressive. At the time, I thought success had to wear a suit and have a skyline.

Image versus opportunity wasn’t a new dilemma. He’d faced it at fifteen.

DR: I got let go from a pizza parlour at fifteen and ended up at McDonald’s because they were the only place that would take anyone. That’s where I learned the value of best practices. I owe a lot of my personal wealth today to a minimum wage job I considered embarrassing as a teenager.

His boss had just sold his own pest control startup to Terminix for $10 million after four years, and was offering Royce the same template. Royce had $300,000 saved from four college summers, originally earmarked for MBA school. That became his start-up capital.

DR: I was making $225,000 a summer. About half a million in today’s money. I asked my boss every pain point he had, and where he’d improve the business if he had the time. He gave me 30 things to fix. I had a finance degree, which is highly unusual in pest control. So I swallowed my ego and chose the opportunity instead of the image.

“I swallowed my ego and chose the opportunity instead of the image.”

NC: Year one you almost went bankrupt in Los Angeles. But not for the usual reason. What happened?

DR: Year one I learned you can be killing it and dying at the same time. We grew far faster than I could have imagined and almost bankrupted the company. The business model required me to pay my salespeople’s commissions in advance of the revenue coming in. A timing issue with cash flow.

He had planned for 4,000 to 5,000 new customers that year. He did 7,500. Nobody in the industry had ever done that many from a single branch.

DR: I had to go to multiple sales leaders and ask for an extra month or two to pay their bonus checks. I gave them an extra 10% interest on their money. Luckily they’d all had an amazing summer and were willing. Revenues are vanity. Profits are sanity. But cash flow is reality.

That scare taught him to fund growth differently. The workaround became the structural template across four companies.

NC: You sold three companies before Aptive, all to the same strategic buyer, and you never gave up your key people. Take us through how that worked.

DR: The asset deal structure was the key. Each time, I sold just the customers and the technicians servicing them. That was all the strategic buyers wanted anyway. They had their own brand, their own back office. They needed streams of recurring revenue. So I’d carve out my leadership team, my operations managers and my salesforce from the deal. That was the golden goose. Then I’d take the capital and start the next company with the same team, in new locations, better capitalised. No investors. No equity dilution. Same family, bigger stage.

NC: There are over 20,000 pest control competitors in North America. What let you grow seven to ten times faster than the rest of them?

DR: Three things. Our sales program. We built it into a machine of 3,000-plus people, and reps who switched over from competitors were producing 70% more in a summer than at their previous employer. Second, additional service features. I’d knocked on 60,000-plus doors in college, so I basically got a PhD in what homeowners complained about. Third, we invested early in software to improve efficiencies and gamify the business. Unheard of seventeen years ago for a blue-collar company. We built a sales app that ran tournaments nationwide and lifted productivity by up to 30% on tournament days.

NC: Why is there so much opportunity in blue-collar industries?

DR: Unsexy industries often have sexy margins. The Wall Street Journal calls these owners the stealthy wealthy. Among the top 0.1% of income earners in the U.S., people making about $2.3 million a year or more, roughly 43% of them are in what most people would call boring blue-collar industries.

There’s also a huge trend right now. Millions of baby boomers are retiring who own these kinds of businesses, and the majority don’t have anyone to sell to. Most are essential services with recurring revenue models. Recessions come and go. But bugs don’t read The Wall Street Journal.

DR: AI is making them even more attractive. AI can write code, analyse legal documents and automate a lot of entry-level office work. But it’s not unclogging your toilet anytime soon. It can’t climb on your roof. And it definitely can’t treat the termites in your walls.

“Revenues are vanity. Profits are sanity. But cash flow is reality.”

NC: You built one of the most talked-about cultures in home services. NCAA basketball court at HQ, golf simulator, retreats in Egypt and Thailand, skydiving, swimming with sharks, racing Ferraris around a track. Where did this philosophy come from?

DR: I read Tony Hsieh’s Delivering Happiness when I was struggling with how to keep a family feel across the country. The lesson stuck. Tony sold his first company for hundreds of millions and was miserable because the culture wasn’t intentional. Culture isn’t vibes. It’s design.

We tried a lot of fun stuff after that, and it helped us stand out. But if I’m honest, perks are sugar. They’re not the protein. The primary driver attracting top talent was always the training program. They wanted to sell more than at any other company.

DR: The other thing I’m most proud of was giving away 25% of the company to our employees. I wanted to align everyone’s interests so they could benefit financially when I sold the business. We had over $500 million in annual revenue, and companies in my industry sell between one and three times revenue. So we gave away a nine-digit number to our team members at the exit. Many received six- or seven-digit figures.

I’ll never forget the calls. Lots of our team members paid off their mortgages and student loans. Another bought his parents a brand-new car. And I remember hanging up thinking, that was worth it. Turns out ownership is a far better retention tool than ping-pong tables.

NC: After three companies as CEO, you stepped aside at Aptive. How did you actually let go?

DR: For a decade, I’d been training my protégé. He’d joined my second year in business and worked his way up. Top sales rep, top sales manager, then running our sales recruiting program. When I started Aptive, I replaced myself with him as CEO.

When you replace yourself, you realise very quickly whether you built a company or a dependency. The hardest part wasn’t the structure. It was me staying out of it. There’s a temptation when you see something slightly off to jump back in and save the day. I had to learn that leadership at that level means letting someone else win, even if they’d do it differently. I had to stop being the hero and start being the architect.

Letting go of the CEO seat was one thing. Bringing in seasoned executives from much bigger companies was another, and that lesson cost him an exit.

NC: What happened with the big-company hire?

DR: We hired a CFO who had worked at a billion-dollar tech company. On paper, incredible. So we gave him a lot of autonomy. But resumes don’t run companies. People do. He was used to having dozens of people underneath him and wasn’t aware of how all our expenses hit the business. That year, we’d launched a process to sell half of Aptive. We had initial offers from half a dozen buyers valuing the company between $1 and $1.6 billion. We were already missing forecasts, and the misses got bigger each month. One by one, every buyer dropped off.

DR: A few lessons. First, trust but verify. Second, never miss your forecast while running a sale process. Buyers hate it, and it hands them leverage in the negotiation. Third, when you do run a process, only about 50% of sellers find a buyer. That’s OK. You learn a lot about what buyers want and can improve before going to market again, just like we did.

NC: Last question. After four companies and twenty years, what do you want people to take from your story?

DR: Success has always been a moving target for me. I was sitting in a room with other entrepreneurs once, and someone asked everyone what their number was. How much is enough? At the end he told us we were all wrong. The right answer is, just a little more. No matter what goals we set, our brain goes, cool, now double it. Entrepreneurship isn’t really about a big exit or financial freedom. It’s the expertise, discipline and character you develop along the way. If you don’t enjoy the climb, the summit is going to disappoint you.

DR: I’ve always been most passionate about helping develop people. Gandhi said the sign of a good leader is not how many followers one has, but how many leaders one can create. If there’s a legacy I care about, it’s not the valuation. It’s the leaders we helped build along the way.

From a kid who thought he wasn’t smart, to a door-to-door salesman too stubborn to quit, to the founder of a billion-dollar empire built in an industry nobody else wanted, David Royce has always known one thing: the opportunity worth taking rarely looks like one.

The post How a Sixth-Grade Teacher and a Door-to-Door Job Built a Billion-Dollar Pest Control Empire appeared first on Foundr.

This interview has been edited for length and clarity. Leila Hormozi doesn’t talk about her past to shock people. She talks about it because she thinks it’s the point.

The co-founder of Acquisition.com has been open about the six arrests, the addiction, and the moment she stood in front of a mirror and decided she didn’t want to be that person anymore. Not as a cautionary tale, but as proof that the same capacity for excess that nearly destroyed her is exactly what built a portfolio doing over $250 million in annual revenue by the time she was 30.

Foundr CEO Nathan Chan sat down with Hormozi to hear how a personal trainer with $5,000 in her bank account became one of the most respected operators in online business, and what she’s learned about leadership, execution, and telling people the truth even when it costs you.

Q&A with Leila Hormozi

Nathan Chan: You were arrested six times in eighteen months. What finally made something click?

“It wasn’t discipline. It was complete pain.”

NC: You moved across the country, became a personal trainer, started from scratch. How did that phase build the operator you are today?

LH: I became a personal trainer. I walked to every gym that was within walking distance from where I lived. I got a job at the closest gym so I didn’t have to spend any money on gas. I had $5,000 in my bank and my rent was $1,500 a month. I just needed to make it work.

That period of selling, building client rosters from zero, and managing survival-level finances became the foundation for everything that followed.

LH: I am such a fanatic about leadership, starting with self-leadership, because you cannot lead others unless you can lead yourself. And that’s what kicked me off on that journey. Starting a business is just a vehicle for how I can help other people better their lives.

“You cannot lead others unless you can lead yourself.”

NC: You and Alex met on Bumble, and he pitched you on Gym Launch on the first date. What made you say yes?

LH: I said, the worst case scenario is I end up right back where I am now, needing to build up my client rosters again. I can accept that. And when else in my life can I do this with very little consequences?

The early days of Gym Launch were marked by one disaster after another: a fraudulent business partner who drained their bank account, a merchant processor that locked their funds on Christmas Eve, and friends who had quit their jobs to work for a company that suddenly had no money.

LH: I had burner phones with different accounts on them because that worked at the time. We scrounged everything possible.

NC: You scaled Gym Launch from zero to $50 million in twenty months. But Glassdoor told a different story. What happened?

LH: We had a 4.9 Glassdoor up until I learned a very hard lesson, which is that you cannot let inexperienced managers make hiring projections. We hired 35 people. We only needed five. I had all of the same desire that I do now. I just want to make an amazing place for people to work. I had the desire. I didn’t have the skill.

The day before she was supposed to lay people off, her director of HR texted one person and told her she was going to get fired. That person told the whole team.

LH: My Glassdoor went from a 4.9 to a 2.2.

NC: You’ve talked about struggling with wanting to be liked, and how that actually failed the people around you. How did you work through it?

LH: I desperately wanted to be liked and I didn’t know it. I came from the side of being incredibly empathetic, incredibly understanding. I had to go through going from there to probably swinging too far on the other side, then finding my middle ground.

I realized it’s really not better to be nice in that way, because the two personalities have the same effect on people long term. Whether I’m yelling at my team, or I’m being so nice I don’t tell them the truth, the same result occurs. That person doesn’t know what they need to do better.

The shift came when Hormozi had to let go of a close friend she had hired, someone she had failed to give honest feedback to until it was too late.

LH: I remember in the firing I said: if I could fire myself, I would, but I own the company. I hadn’t given them the feedback they deserved. And because of that, they lost respect from the teams.

I started following John Wooden’s stuff about seven years ago. I said, I’m the coach. What’s the coach’s job? The coach’s job is to tell you: you’re at a six. I need you at a ten. Here’s how to get there. And that changed everything for me.

“I was being deceptive to spare my own feelings of being uncomfortable.”

NC: There is a through line across everything you touch: Gym Launch, Alan, your SaaS company. Rapid, outsized growth is always the result. What drives that?

LH: There are two things you have to have. You have to be building what the customer wants: the offer, the money model, understanding the market. And on the other side, you have to say: how are we gonna make that happen? Most people put a lot of resources on the first side and completely underestimate how many they’ll need on the second.

When I think about business capacity, I think about financial capacity, personnel capacity, systems capacity, and thinking capacity. How many people wake up every morning thinking about this thing? You need all four in excess before you launch.

LH: Most businesses don’t fail because of a bad strategy. They fail because they have poor execution, and they have nobody to tell them what good execution looks like. Out of all the portfolio companies we’ve looked at, probably two of them were capped because of strategy. The other fifty, it was execution.

NC: You are obsessive about talent. What do most founders get wrong about building a team?

LH: A great environment can take a mediocre person and make them great. But if you are just starting your business and you don’t have that culture yet, guess who makes the culture? You are the culture. The CEO, the founder is the heartbeat of the business.

It was not until I realized that every single thing I did was heard through a megaphone and seen through a microscope by my team. They modeled all of my behavior. I’m thinking everywhere: they’re watching, and I’m teaching through my actions, not my words.

NC: How do you attract great people without a big brand or huge compensation packages?

LH: You have to know what your offer is to the marketplace as a small business owner. For me, I don’t want it to be money. I want it to be growth. In a fast growth company, if people don’t want to grow, they see every point of change as a threat rather than a challenge. I want people who see those inflection points as challenges.

I have a big people team: six people, looking to hire four more. A lot of companies would be triple my size before they had a team that big. But I believe in the employee experience the same way I believe in the customer experience.

Despite having no Ivy League pedigree and starting out at community college, Hormozi has built a team of former founders, seasoned executives, and high-growth operators drawn not by compensation but by culture.

LH: I just started these companies after I graduated from community college. But they come because of the offer we present: we are a place for people to grow, and we leave everyone better than they came in.

NC: Last question. What do you want people to take away from your story?

LH: Do you think we would have had the massive success without the massive failures? No. The same muscle that allows you to succeed at that level and take those risks also means you’re gonna fall on your face. It’s a rite of passage.

LH: I became obsessed with how to build an amazing team: a team that can get us not just to 50 million, but to 50 billion. And it all starts with understanding your team as much or better than you understand your customer.

From arrest warrants on kitchen tables to leading one of the most respected operator-founder duos in online business, Leila Hormozi’s story is ultimately about one thing: the moment the pain of staying the same outweighs the fear of change.

The post How Leila Hormozi Went from Six Arrests to a $250 Million Empire appeared first on Foundr.