BACKGROUND
In 2007, Rudy Larsen started Lawn Butler, a lawn care and maintenance company. Over the next 5 years, they evolved to focus exclusively on commercial maintenance and they acquired a company that performed commercial installs. Today, Lawn Butler is the largest landscaping, snow removal, and outdoor equipment installation company in the state of Utah.
CHALLENGE
During Lawn Butler’s early stages of growth, they relied upon the cash flows generated from their business rather than raising capital. Their rapid growth led to accelerating and increasing working capital demands with 90-120 days to collect receivables, leaving them in a cash crunch. This placed immense pressure on management due to their large payroll obligations. Lawn Butler used a simple budgeting process to manage the business but knew they needed a five-year forecasting model to better understand their cash flows. At the time, however, their current controller didn’t have much experience forecasting and Lawn Butler couldn’t afford to hire a full-time CFO with higher expertise.
SOLUTION
In 2016, Lawn Butler hired an Ampleo outsourced CFO for 15-20 hours a week. Ampleo stepped in and built a budget and 5-year forecasting model that strategically took into account different business scenarios. In Lawn Butler’s business, snow removal is a large portion of their revenue. Depending on the amount of snowfall in a given year would potentially put a lot of strain on the model. Putting everything into the new model and following Ampleo’s expertise and advice, allowed Lawn Butler to manage their cash flows and be more disciplined about their growth instead of constantly putting themselves in cash pinches. To this day they still use, add to, and build out this budget and model which helped as they grew from $30K to $20M annually before they sold the company. According to Rudy, “Hiring Ampleo wasn’t only good for our business but for my mental health as the CEO. Getting into a situation where we grew a ton but then were struggling to make payroll put a lot of pressure on me. Ampleo relieved a lot of that pressure.”
CONTINUED SUCCESS
Lawn Butler had many detailed, thoughtful and strategic conversations with Ampleo about if they should raise capital. After considering all the pros and cons, they ultimately decided that through discipline they could succeed on their own without raising capital. Because Lawn Butler never raised any capital and operated solely on the cash flows generated from their company, when they sold their company, they generated a 128,000% return on their money. That was an increase of 11,000% a year from their initial investment to what their exit was. Rudy said, “The expertise we received from hiring Ampleo was worth way more than what we actually paid them.”
“Make sure you view hiring Ampleo as a long-term investment for your business and not an operating expense even though it will appear on your balance sheet as an expense. Looking back I wish I had hired Ampleo sooner.”
– Rudy Larsen, Founder of Lawn Butler
“I think there are certain things you don’t try to get bargain pricing on. When you are getting expert advice, like Ampleo vs someone who doesn’t know what they are doing, it doesn’t matter how much more or how much cheaper, you will still get garbage work if you go with the person who doesn’t know what they are doing. I knew with Ampleo I was going to get what I paid for.”
– Rudy Larsen, Founder of Lawn Butler
