Ron Holt's company made its first million doing the dirty work you hate: washing floors, dusting living rooms and scrubbing tubs.
The 43-year-old is the founder and CEO of Two Maids & A Mop, a Birmingham, Alabama-based home-cleaning service that operates in 55 locations and employs 500 workers.
The 14-year-old firm is expected to rack up $11 million in sales this year.
But it wasn't all that long ago when Holt had to scrape together $150,000 in order to start his business.
At the time, he left a job as the director of a lab that specialized in the science of small particles — so that he could tidy homes and be his own boss.
"I had career opportunities in front of me and in the industry," Holt said. "There was a bright future, but it wasn't bright enough."
"It wasn't running my own business," he said.
Here's how Holt, married and a father of two, turned other people's messes into millions.
No ordinary start-up
Working at the lab from 1997 to 2003, not only did Holt dream of running his own business, he also set his sights on the field he'd go into: home cleaning.
That industry had three key features that Holt believed would lead to success. First, it had the prospect of recurring revenue — a stable inflow of cash from happy customers. Second, it was a field that didn't embrace technology, creating opportunity outside the tech-laden start-up field.
Finally, how many entrepreneurs can genuinely be excited about scrubbing grout and taking out the trash?
"I really wanted to be in an industry that no one else wanted to be in," he said. "Silicon Valley isn't really chasing us because at the end of the day you got to clean dirty toilets."
Still, Holt had plenty of competition. Large cleaning service franchises include Merry Maids, Molly Maid and MaidPro. Small mom-and-pop operations fought for customers on a local level.
In order to seed his new business, Holt put away $150,000 over seven years. He spent his days working at the lab, but would moonlight flipping burgers, cleaning for friends and installing "for sale" signs for real estate agents to drum up extra cash.
Holt also shrunk his expenses, subsisting on fish sticks and rice every night. The upside was that he had no real social life, so he saved money that way, too.
"I was in my mid-20s," he said. "Eating fish sticks and rice wasn't very cool."
Once Holt scraped up enough money, he bought a small one-man cleaning service in Pensacola, Florida, on April 1, 2003. That was Two Maids & A Mop's first location.
Turning point
After its first year in business, Two Maids & A Mop raked in $110,000 in sales.
The typical client pays $130 for a cleaning job that covers most of the home, exclusive of windows, walls and doors.
Starting out, Holt himself washed clients' floors, in addition to hiring employees, leading the firm's marketing strategy and buying supplies.
By the second year, Holt burned through his original investment.
"About two years in, the reality hit," he said. "I had just made payroll, so things were supposed to be good, but I had almost exhausted that $150,000."
Holt began to think beyond the firm's location in Florida as he sought more ways to make money.
That was when he came up with "pay for performance," a model that rewards cleaners for exemplary work based on positive ratings from clients on a scale of 1 to 10.
To expand outreach, Holt turned away from paper-based marketing, opting instead for search engine optimization, social media and pay-per-click marketing on the web.
Once Two Maids & A Mop grew to 12 locations and about $4 million in sales, Holt went into franchising in order to foster the company's growth without getting bogged down in excessive expenses.
"Franchisees pay us for the right to operate under our brand and execute our system," he said. "They want to do that, and it's more of a partnership."
For about $110,000, franchisees gain the right to operate under the Two Maids & A Mop banner and get access to approved vendors and support from the home office.
Holt aims to open 20 to 30 more franchises within the next five years.
Get dirty
Holt, who no longer scrubs toilets, has two pieces of advice for would-be entrepreneurs.
- Set your goals before you go. "I told everyone we were going to be the largest residential cleaning service in America," said Holt. "I said it when we had 250 square feet of space." Believe in that dream and never stop chasing it.
- Work harder than ever. Don't wait for investors to swoop in and fund your idea. "America is built on hard work, not venture capitalism," said Holt. "You don't build an app and get rich overnight; it takes a long time."
— Video by Sophie Bearman, Qin Chen and Kyle Walsh
