Exec Interview: Fire Solutions Starter CertaSite Takes Flight
A relative newcomer to the fire/life-safety business has been setting the market ablaze with the swiftness of a backdraft. Find out how the assertive leadership of a seasoned CEO and savvy investors aim to raise the bar on innovation, expertise and service.
Hitting the ground running is considered an advantage … unless a solid brick wall drops out of nowhere smack dab in your path. That’s the scenario that played out for the former president of one of the industry’s entrenched fire/life-safety systems providers, his team and a private equity firm.
Founded in 2018, having already folded in several acquisitions, CertaSite was ready to take full launch when the pandemic abruptly threw an enormous wrench into the spokes.
“Having the concept and framework of the business with all the pieces in place, we were set to put the pedal to the metal and go to go as fast as possible, while doing it right. Then just as we were pushing the accelerator to the floor, the pandemic happened,” says CEO Jeff Wyatt, who previously spent 25 years at Koorsen Fire & Security. “We had to stop and take our foot off the gas. We had to realize that’s not possible; we’re facing something that we’ve never faced before.”
Despite having to navigate through uncharted waters — keen business management and steely determination, a callback to Wyatt’s former service on a U.S. Navy submarine — allowed CertaSite to keep its eye on the prize and stay the course.
Having just made its 15th company acquisition, the Indianapolis-headquartered firm is rapidly growing its Midwest footprint and number of employees to serve its rapidly expanding customer base. (See the Fast Facts box for more.)
“Our private equity firm, The Riverside Company, was interested in starting from the ground up,” adds Wyatt. “The process used every ounce of my experience, brainpower and available resources. Three acquisitions in rapid succession established our base, then we really started working to integrate and grow from there. We’ve been very aggressive, describing it as flying the plane while we’re building it.”
SSI spoke with Wyatt and one of his executive team members, Chief Marketing & Strategy Implementaton Officer Kelly Henderson (also formerly of Koorsen), to get a better handle on this new pacesetter’s strategies and perspectives. They talk contending with COVID, products and services, culture, and market differentiation.
How did your prior experiences at Koorsen help you shape CertaSite?
Jeff Wyatt: Koorsen started in 1946, so they had been around for a really long time before I joined the organization. I had a unique experience in that I started out as a technician, I was an installer. I came out of the Navy as a communications electrician and I had two choices in my head, I was either going to be the cable guy or I was going to be the fire guy. Even at that age, I was still wise enough, I guess, to say fire has a better purpose in my head. I wanted to do that.
As I think about my 25 years there, we did a whole lot of good things right. I am very proud of my experience not only as an employee but also as an executive and ultimately leader of the organization, working with the owner, Randy Koorsen, and his family. They gave me a tremendous opportunity. I learned a lot, flying by the seat of my pants at times.
The main thing about this business in comparison is my opportunity to take all the things that maybe I would like to have done there that I couldn’t, for one reason or another, and bring them here. Secondly, purely from an investment perspective is having a professional board, no disrespect to anybody in my previous organization. In addition to the incredible people on my team the board of businesspeople I work with guides us.
It is gratifying that we’ve been able to take this business and start it from zero to build it where it is today in just a little over three years. It’s a little harder in a privately held company, whether it be from a financial perspective or from differences of opinion perspective or maybe it’s not the vision of the owner. I’m very proud and excited about what we’re doing here.
How did the pandemic change the early plan and course of the business?
Wyatt: I felt like I could handle any issue be it related to people, business, customers, ERP systems, whatever, I had the experience to deal with anything. However, the pandemic was this unexpected event that nobody was, or could have reasonably been, prepared for. There was a whole lot of unknowns as to taking the right steps.
CertaSite had to stop in our tracks and re-evaluate by asking, “OK, what do we know and what are we doing?” We had daily calls with our board, and even for these business professionals it was uncharted territory. However, they had gone through other challenges, and we were able to really have honest conversations every day about what we needed to do. Things were complicated for us because due to our backing we were not eligible for the PPP loan, as many of my competitors were. We had to evaluate how to operate our business when a percentage of customers were not open.
Suddenly, we didn’t have the same revenue we expected. But we were thankful to see the CARES Act come into play, which made a major difference for us. It allowed us to furlough people with the confidence of knowing they were going to continue to get paid, although it was still one of the most difficult things I’ve had to do. Fortunately, it took only a few months before we started to come back despite the pandemic continuing. It has helped us to look at every datapoint, every indicator, watching things very carefully to get the business back on track.
We were excited about 2021, but we all continue to see how challenging that was. We navigated through it and at no point were ever in any financial dire straits. Our business did a great job, and we took great care of our people as well as our customers. It allowed us to focus on our technology stack and to continue to do acquisitions throughout the pandemic. It also allowed us to focus on things like our training academy, which is important to our future.
Kelly Henderson: We became CertaSite right as the pandemic hit. Here we were getting ready to launch CertaSite, which no one knew who we were. On March 30, 2020, the world shut down, just as we were introducing CertaSite to the world, as well as our employees. But the journey we went on as we started and how intentional we have been since the beginning helped position us to continue that singular focused mission with a vision of who we are and what we want to be for our customers and employees.
It helped at least set the foundation for how we supported our company, how we continue to focus on innovation and development of our processes. We didn’t lose sight of that, even though there was a massive impact to our economy, to the people, to the lives we were supporting. We came together as a team. It’s still a lot to navigate.
As a leadership team, since we’ve started, we’ve been predominantly remote. When we first started there were two executives and a lot of us traveled and worked from home. We were excited just as the pandemic was hitting to have an actual corporate office, and then we shut down. We ultimately came together under one corporate headquarters. During COVID we hired the most employees, from finance to human resources to marketing to sales, and now we’re all under one roof. That has helped us come together as a team and work more collaboratively.
Could you highlight some of CertaSite’s leading services and technologies?
Wyatt: Our No. 1 area of business we do every day is fire extinguishers. Every commercial building out there has got fire extinguishers and many of the companies we have acquired had significant bases of fire extinguisher customers. When we think about that on the inspection, maintenance and new products basis, our second-largest area is fire sprinklers. Fire alarm is our third-largest area for inspection, test, maintenance, and we also heavily install fire alarm systems.
Additional areas include suppression and fire protection products, and industrial systems. Another area we are focusing in on is alarm monitoring, which is great for recurring revenue, or RMR. We are putting a major emphasis on the growth, both organically and inorganically, for the alarm monitoring business, particularly commercial fire monitoring. We love the idea of expanding how we can impact our customers’ lives, and so adding more monitored accounts is an important initiative.
It’s a nice advantage that recurring monthly revenue is not as reliant upon technicians as installations or service. You’re providing a monitoring invoice to a customer, quarterly or annually, whatever it is. Yes you have to install and maintain it, but we don’t have to rely on a tech every day to generate that RMR. We see that as a real benefit in the world we’re in today with the labor struggles most see. It’s good to have an area of nontech-based revenue as a priority for us.
We have such a large opportunity to grow our business still, when I look at our fire alarm and sprinkler customers and the percentage monitored. We have a lot of room to grow from a monitoring cross-sell perspective. Then with the acquisitions we’re doing, many with a nice amount of accounts, presenting the opportunity for us to add that piece of the business. Then there’s also cross-sell opportunities in other areas such as video monitoring. There are many possibilities through monitored services today.
Henderson: I think about CertaSite making a difference for the customer — in our facility managers, environmental health and safety leaders that are running health care facilities, property management groups, manufacturing plants, all the way into the utility space — these individuals’ livelihoods and responsibility to manage and adhere to all the regulatory requirements for not only fire protection but also things unique to their unique vertical.
They work in highly supportive roles where lives are at risk with core responsibilities to ensure their fire protection and security systems are up to code. We asked them for feedback as we were forming CertaSite. We wanted to know what was important to them and what was painful about managing fire and life safety from their perspective. We built our products and services around what they wanted, so everything from the experience of doing business with us to the solutions we provide would be as easy, efficient and effective as possible.
CertaSite partners with them so they can report back to their AHJ, compliance officer or safety board with the information they need and ultimately comes alongside them as consultants. In addition we looked at how we could add more products and services to really support them.
Recently, we became a KnoxBox [small, wall-mounted safe that holds building keys to give emergency responders access] distributor in the majority of our markets, and that is another product line with helping our customers in mind. We continue to look at other products as services that offer innovation or a better customer experience. Part of that as well is training and developing our technicians to ensure they’re showing up, doing the same process every time and helping to educate customers. To that end, we built out our CertaSite Academy.
Wyatt: Through our acquired companies, we had 12 different central stations to contend with! Can you imagine? It’s been a major undertaking this past year to get all the accounts onto CMS’ platform, which has been a big win for us and our customers. Many of the legacy central stations didn’t have the same level of technology CMS offers.
When I think about the user experience, people don’t have the time to worry about their fire or life-safety equipment. They trust us to do that for them, but they need access to the data. In many cases they need to provide it for their insurance to audit their safety programs, or they just need to have to have an idea where things stand. Providing that through both CertaSite’s simplified customer portal and access through CMS is really important.
In addition to 12 central stations, we had 12 QuickBooks accounts at some point that our finance team was managing. We’ve merged all of those into one. But as a result, the level of technology implementation we’ve done and integration it allows has been huge for our techs, field staff, sales and marketing team, and HR. Then how the customer is benefiting ultimately will win us a lot of business.
What are two or three differentiators you see CertaSite bringing to the fore?
Wyatt: Our biggest differentiator is being so focused on the ability to service the customer in a way they’re not used to. When CertaSite takes on a new customer, our salesforce does a great job presenting what they’re going to get. As a customer of CertaSite, they’re going to have an easier path to getting what they want, the services they need. They’re going to know we’re coming, we’re going to be onsite. We’re going to be able to properly present back to them data about their facility that other companies have not been able to do.
Most customers today are used to everything being electronic and accessible online, hitting one button to get where they want to go. Those are things we want to do for our customers and believe it’s a differentiator. Some competitors may be using inspection testing software, but they’re not using software integrated into a full platform that allows that data to be utilized in a much larger way. Secondly, my background has helped us be very focused on building the latest and greatest training platform for our technicians, which as mentioned is called the CertaSite Academy.
This incredible solution is an online platform that gives our techs access to online as well as hands-on, classroom-style training, manufacturer-provided courses, and industry training through organizations like FSSA [Fire Suppression Systems Association]. Our techs get the training they need to do their job really well, whether they have experience or not, and also the ability to keep learning above and beyond what they might need to know for their particular role. There are bonus levels, there’s compensation that ties to their level of experience, all those things.
When you think about price and the competitive landscape, there’s such a wide variety of pricing in the market. When I think about what we charge, which is a premium, we have people who are very well trained and they are more expensive as employees, and they deserve to be because they’re very good at what they do. If that higher level of expertise allows us to get the job done in half the time of my competitor, our customers are really happy about that.
Lastly, from an acquisitions standpoint, we’re fully integrating every company we bring on. For me, it’s not a race to see how many we can get done in a year but to do the best that we can do with doing it right. I want every acquisition we do to work well and be an additive to the organization. I want those employees to feel like they’re part of our culture. Perhaps we’re a little more intentional than most about how we go to the market relative to acquisitions.
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