Getting Unstuck: How to Break Through the $10 Million Ceiling and Beyond

In this final episode of our 3-part mini-series with Michael Katz, Owner of Trio Heating & Air, we dive into the gritty reality of scaling a trades business from $5M to $10M and beyond. 

Katz shares what it really took to build Trio into a $15M-plus operation in just a few short years, including the personal sacrifices, mindset shifts, and leadership evolution that fueled the journey. Katz gets candid about burning out, questioning his path, and ultimately transforming his own leadership style to match the company’s needs. 

In this podcast recap, you’ll learn:

• The trade-offs of growing a business vs. staying lean and profitable

• Why you have to change your personality to match your business

• Targeting the right customers at the right time with ServiceTitan

• Leveraging your TitanAdvisor score

The trade-offs of growing a business vs. staying lean and profitable

To kick off the final episode in the series, podcast host Josh Lu asks Katz if scaling a business to $10 million and beyond is the right fit for all service companies. 

“There are pros and cons in either decision that you choose,” he says.” I don't think there's a right or wrong answer. I think there's a right one and wrong one for you, because it depends on your personality, it depends on your family situation, and your obligations.”

Katz says he personally feels bored and stagnated when his business experiences a lull, but understands some business owners may prefer a more stable environment.

“There's a saying where you suffer no matter what, so just choose your suffering,” he says. “For me, I understood that. I enjoy growth and it stretches me out mentally to be able to take on more capacity and understand more. I’m developing so much faster as a businessperson, as an entrepreneur.”

While Katz is entirely on board with the hyper-growth mindset, he says it may not be the right fit for all businesses. He says service businesses shouldn’t expect to get rich overnight. 

“There are a lot of transitions, and in those times, you're not necessarily always going to be making money when you're past $5 million or $7 million, that's where you're becoming a serious operation and serious in the sense that there's a lot of risks involved,” Katz says. “You can't make these quick adjustments tomorrow and say, ‘You know what? Let me write a check because I want to buy a nice motorcycle because I saw Sons of Anarchy.’ 

“You’ve got to be more calculated,” he adds. “When you're a small business, you don't have that much overhead and you can make these decisions and you can kind of do whatever you want, but at the same time, that's the risk because you're small.”

It ultimately comes down to your personal business goals, and Katz says there are pluses and minuses to scaling big.

“I think $15 million to $30 million is a great size, because you have enough customers in your database to make sure you have repetitive business,” Katz says. “You have enough managers, so if a manager goes on vacation or gets sick, you're still rocking and rolling.”

On the negative side, Katz says smaller shops can quickly feel the pain if they don’t have the resources to support the expansion. 

“If you only have one sales guy and he's out on vacation, your business is shut down,” Katz says. “It's kind of like a small business, but you're a fireman. You're just jumping from one thing to the next. You can't even implement certain processes.

“It really just depends on what you're looking for,” he adds. “I'm in it for the long term. I'm here for the big dream, and that’s more than what most people are after in this industry.”

So, what does it take to move to the $10 million mark and beyond? For Katz, he says hiring his senior leadership team made all the difference.

“With these managers, you can finish all the pending projects, set up the KPIs and tie them into their performance pay to make sure there's an incentive there, and add layers of incentives to their people as well,” Katz says. “That way everyone will row in the same direction.”

Prior to hiring his team, Katz says he often worked 14- to16-hour days, seven days a week. It caused tremendous stress, his hair started to fall out, and he almost had a heart attack. But once his leadership team was in place, everything started running smoothly. 

Katz met with other business owners to understand optimal conversion rates for each department and designed aggressive KPIs to hit their new goal of hitting $10 million in revenue.

Why you have to change your personality to match your business

Lou asks Katz how he became the leader he is today and how he recruits high-performing people to work for his organization.

“You have to change your personality between $1 million to $5 million to $10 million,” Katz says. “This is the make-or-break point. I don't care how much desire you have and how much willpower you have, if you’re not going to be able to change your personality, someone's going to have to take the spot. Otherwise, it's just not going to work.”

Katz says he often makes mistakes, and most successful companies do. But that’s okay.

“You have to be vulnerable and to admit you made the mistake and be willing to fix it and change it,” Katz says. “For me, with leadership, I try to be really transparent and share my core values with my team. I try to be really transparent and just lay it all out. I try to be vulnerable as well and admit when I'm doing something wrong. I'm very open-minded.”

Katz says he aims to be tough but fair with his managers, but also empower them to take charge.

“Even if you think it's going to fail or know it's going to fail, it's okay to let them do it and show them when these things happen, you're not going to point the finger and say, ‘I told you so,’” Katz says. “It's going to be more of, ‘Okay, we tried it and trying is the most important thing and not every idea is going to be perfect, but let's keep trying until we figure this thing out.’”

Katz says he’s grown from his mistakes and continues to evolve as a leader. One of the biggest lessons he’s learned is that growth often means stepping outside your comfort zone, even when it’s unfamiliar territory

“You're going to have to do things that you don't want to do because there’s no time or place to say, ‘I'm not an expert at this. So, I'm not going to do that,’” Katz says. “You're going to have to become a little bit of an expert in everything, because that's what the most successful people do. They're problem-solvers on different scales.” 

Targeting the right customers at the right time with ServiceTitan

Lou asks Katz about the ServiceTitan features that helped him surpass the $10 million mark.

Katz mentions how automations within ServiceTitan Marketing Pro prove key to running an upscaling business. 

“You have to have text automation and email automation running in your business all the time,” he says. “And not by you clicking to launch them, just by them being in the background.

“And you have to turn those things on very quickly. You have to get the right campaigns,” he adds. “Basically, we noticed that once you get to $10 million, it's mainly just some process building. A lot of it’s just hitting your KPIs, marketing, and sales. Those are like the three main things that are running the business.”

Katz uses ServiceTitan to sort all of his customer interactions into buckets, like calls that came in but didn’t book, or calls where an installer went onsite. Regardless of the interaction, they always fall into a bucket.

He says one example is the customers who call but don't end up booking. Typically, when that happens, the rep just hangs up and moves on to the next call. But what happens after that? Nothing. That lead disappears. But maybe the customer didn’t book because you didn’t have the right availability.

“You should be following up with them because it doesn't mean the next business answered the phone and they already forgot about you,” Katz says. “So, they fall into the bucket of ‘called lead but not booked.’ 

“There's an automation through Marketing Pro that's going to be sent to them,” he adds. “It's going to shoot a text message to them saying, ‘We're so sorry that we weren't able to assist you today, but we're here to help you.’”

Another ServiceTitan automation targets customers who buy a service but don’t sign up for a membership. 

“The automation goes live and says, ‘Thank you so much for doing service with us. I don't know if the technician mentioned that we have an amazing membership,’ and then it hits them three different times,” Katz says.

For tuneups, he ensures automated messages go out in the spring so systems are running optimally when summer hits and he can focus on bigger jobs. 

Katz says there’s no need to hire a marketing consultant or graphic designer for your campaigns, and instead recommends using the pre-made templates in ServiceTitan.

“You’re going to use these templates the following year and the following year and the following year,” Katz says. So, if you know you're always going to be slow in certain months, set it and forget it. 

“You basically tell ServiceTitan who you want to target based on certain criteria and whatever makes sense to you and your business, whatever industry you're in. These automations are really simple,” he adds.

Katz says he’s currently updating his pricebook in ServiceTitan to ensure he hits his margins. 

“Especially with tariffs and everything that's happening right now, you have to control your pricebook really well and have a good process, because out of nowhere you could lose 10% profit if you don't increase your pricing in time,” he says.

Katz has also been using tags within ServiceTitan, which he calls "absolutely incredible,” to streamline reporting. 

“We got so good at tags on reporting that a lot of the communication that we used to have internally with each other, we now have with tags,” he says. “There are people pulling reports based off of tags. So, depending on the tag, it gives you the stage of where this customer is at and you don't have to communicate.”

Ultimately, Katz suggests users learn as much about ServiceTitan as possible if they want to hit the $10 million mark or higher.

“If you get to the point that you're using even 50% of the features in ServiceTitan, your business is probably around $20 million or more,” Katz says. “There's no other way around it. If you figured out a way to have even a reason to use all the features in ServiceTitan, it just means that your business is on a completely different scale.”

Leveraging your TitanAdvisor score

To close out the series. Lou asked Katz to talk about TitanAdvisor Score and how it can help businesses grow their profits. The TitanAdvisor Score in ServiceTitan is a dynamic metric that reflects how effectively your business utilizes the platform's features. A higher TitanAdvisor Score is associated with better business performance.

“It's kind of like they give you the playbook and they say, ‘Go implement. Make sure this number is here. Make sure this number's there,’” Katz says. “You don't see it at first, and then suddenly a year goes by and there's one or two more million added to your revenue, and then you implement more stuff and then another few years go by and you're like, ‘Wow, I implemented all these things. I'm at $10 million.’”

Finally, Lou asks what Katz would say if he could put any message on a billboard for all ServiceTitan customers to see.

“Learn the thing. It's not expensive if it 10x’s itself.”

You can find this interview and many more by subscribing to Mastering ServiceTitan on Apple Podcasts, on Spotify, or here. 

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