The Real MF’ers Episode 3: Bob Magnan
Posted November 3rd, 2020
Delta Construction Partners is the largest and most specialized construction recruiting agency. They focus on finding, hiring, and onboarding superintendents, project managers, estimators, designers, and engineers. More than finding a resume that matches a role, Bob and his team built Delta Construction Partners to do something different: to hire the “difference maker” for your organization. Bob built his company based on a core purpose of making life easier for his clients and making work fun for his team.
Full Transcript Below
Scott Peper 0:38
Everybody, welcome to our latest episode of The Real mFers, I’m super excited today to introduce you guys to someone who I’ve become fast friends with or refer to each other as brothers from another mother even. But this is Bob Magnan. He is the CEO and president of delta construction partners. I’m excited specifically to hear from Bob day too, because he’s bringing a whole different spin to the construction world, from the other side, how to find good talent and retain good talent, he runs an amazing business himself, one that I admire and respect just seeing him in the brief time that we’ve known each other. And I’m really excited to bring what he offers and what he’s built to you guys and you guys to hear what he does in his business and how he can help you too. Bob, welcome. Thank you for joining us.
Bob Magnan 1:22
Yeah, thanks for having me, Scott. It’s an honor. Appreciate. appreciate you having me on your show here.
Scott Peper 1:29
Do you mind I’m just for the audience kind of taken maybe a couple minutes, just walk them through high level who you are, where you from? How you started Delta what delta is,
Bob Magnan 1:40
Yeah, sure thing. I started started Delta in 2007. You know, it was perfect timing, you know, the worst construction recession in the history of the world, it’s probably not the most perfect time to start a, you know, construction recruiting business. But somehow we endured, even though my timing wasn’t the best. The first couple years were tough, you know, sat in a small office by myself, and, you know, really just tried to develop a niche and an expertise in the electrical sector. And so our first clients were electrical subcontractors, all over the country, that basically a commercial work, and we went with that niche for the first 10,15, you know, 10,13 years of our company. And in that time, we proved to be the nation’s largest, most specialized, you know, focus, permanent placement recruiting agency that really focused on you know, finding, and hiring, onboarding superintendents, project managers, estimators, designers, engineers, any of the basic management positions, what we did not focus on are the installation position. So the guys that are actually doing all the hard work on the job site. So that’s, that’s kind of the quick, the quick overall summary of where we’re, where we started today from starting, you know, in a small office 200 square feet by myself, you know, we now have about 35, great teams members, and it’s a very high energy passionate, you know, collaborative team culture, and we have a lot of fun every day.
Scott Peper 3:30
Yeah. So if I were to sum it up, you if I’m, if I’m the owner of a electrical contracting company, and I’m growing, and I’m looking for a leadership, talent, and management in engineering, or estimating or those real, more, anything outside of the labor position between me as the owner and the labor force, you I could come to you and you could help me find and retain and hire that talent.
Bob Magnan 3:55
Yes, that’s exactly what we do. And most subcontractors, you know, they’re they’re experts at what they do. And that, you know, the subcontract the business model is a very difficult business model. There’s a lot of moving pieces. So traditionally, most electrical contractors don’t have time to set up, you know, an in house recruiting department, to go find those individuals and qualify them and onboard them that are real difference makers. And that’s what most of our clients are looking for, at least from us, they’re looking for somebody that could add a lot of value to their company, take their company to the next level. And those people are very difficult to find on job boards, you know, like indeed or zip recruiter or monster. Those individuals that are usually listing their resumes. On those job boards are people that are out of work, or usually their employment stability is barely happy. So our clients call us in because we we have the relationships. We have approximately 75,000 electrical construction, and now mechanical construction as well as general construction professionals in our database that we have relationships with. And we’re able to go out and help them on board, you know, them for the great clients that we work for.
Scott Peper 5:18
So, you know, one thing I really want the audience to understand and hear and I don’t know, if I really want them to take this away from what you just said is I have a background in medical, medical device history, I’ve worked in and around, you know, multiple hundred million dollar medical device companies that I was an employee of one point a salesperson, a manager and in different leadership roles. And we always in that business, oh, literally, for almost every position, whether it was sales or marketing, we would always use outside recruiting agencies, and it was part of our budget, and we spent, I mean, they spend hundreds of thousands of dollars a year, hiring and finding talent. And the reason being is it’s so expensive to make a mistake, and train and educate and bring somebody on board to find out that they’re not a good fit culturally, or tantalize. So what I thought was so cool, when I met you, Bob, is that you’re bringing that huge resource to a, to a subcontracting business, that usually is only out there for what is otherwise hundreds of millions of hundred million dollar companies or even billion dollar companies. But for you to have that expertise, and bring that type of value to a smaller, five 610 million, 2 million $1 million dollar business or more is just a really important resource that I don’t think enough people know is out there, or if they do, I don’t think they really understand the value that it brings, and the amount of savings and cost savings it can bring to their business by not making mistakes.
Bob Magnan 6:43
I mean, I mean, you’re hitting the nail right on the head, are our clients expect, expect us to make their lives easier? Right? There, they’re very complicated, you know, from six o’clock in the morning till seven, eight o’clock at night, most of our clients, their hair’s on fire all day long, dealing with General, you know, general contractors or, or owners and, and the various, you know, the labor issues they have all day long design issues, material issues getting paid. I mean, it’s a very complex business model. So, you know, our kind of motto is, you know, we’re going to make your life easier, Mr. subcontractor. And it’s very important to us that, that we succeed in that area. So when an owner of a company gives us an assignment, we understand exactly what they’re looking for. I had the great fortune of working for maybe one of the, you know, top electrical minds in the last, you know, 50 years in our, in our country, maybe even on the planet. And his name was Mitch Permuy. And Mitch founded Power Design, in 1989. And, you know, grew it from the first set of plans on his kitchen table, to now the company is in the $850 million a year revenue range, and growing to probably 1.21 point 3 billion within the next two years. So, you know, it would be like Scott, you had, you know, chance to work for Steve Jobs. Right? Yeah. You know, just being around that energy and that creativity, and that, you know, that brain for a couple of years, you’re going to, you’re going to gain a lot of experience, so and knowledge. And so I had a really good fortune of starting off. For two years working for Power Design, working for directly with Mitch, I kind of shadowed him for three, four hours, you know, every day for two years, and that insight and experience was his, or, you know, millions to me, because I had a chance firsthand to see how a real leader of electrical contractor thinks, right, and how they, you know, how they react to certain situations. So, when I look at a resume now, I see things that I would never be able to see if I hadn’t had that experience. And that gives us and our firm a huge competitive advantage. So it’s proven on a daily basis to help us add a lot of value to our clients lives as well.
Scott Peper 9:22
Yeah, you could have been in the recruiting business and worked with all the medical device recruiters and separated yourself from the others and been just as successful but you chose electrical contracting. And because you have a background in it, you understand it from an owners perspective, you were trained by one of the hot, highly educated, successful company electrical contractors that grew from smaller to 100 and 50 million. And I don’t think you’ve shared this yet, but I happen to know that your dad was a master electrician in the Navy as well.
Bob Magnan 9:52
You know, I always wanted to kind of keep that, you know, the fact that family you know, tie to, you know, to the electrical business going and my dad being a master electrician in the Navy, it just felt like the right thing to do from maybe a DNA standpoint, I was, you know, very proud of my dad. And so that was a feel good type of relationship to what my new career was going to be all about. But besides that is probably, you know, as important.
Maybe more important was the fact that when I worked at Power Design, I had a chance to interact and on a daily basis, you know, talk to project managers and superintendents and interact with them. And I just thought these guys were the salt of the earth kind of guys. And, you know, I had some prior experiences in the brokerage business. And, you know, the difference in personalities and integrity levels is, is significant. So, I just love working with the construction guys, great family, guys, I love performing for my clients. And it was just a lot of fun. And it’s still fun today, it’s not a it’s not a job at all. And every day I come to work in just passionate about being the best construction recruiting firm on the planet. And that’s, that’s our vision.
Scott Peper 11:21
You know, one of the things that I personally focus a lot on in our business, and I think is super important, really is the key separator between success and failure is the culture that you have within your organization. And being passionate about that and speaking about that a lot as much as I can, not only to my own organization, but just in the community and where I’ve learned, one of the things that I was drawn immediately to you just upon walking into meeting you, but walking into your office and meeting your team and your group, is the culture you’ve created there is very clear and evident, and it’s permeated throughout everybody. Can you please talk a little bit about that? Because that’s, that’s not an accident. And you clearly it’s something you worked on and focus on, and you guys live and breathe every day? How did you learn that? Why did you implement it? And what what have you seen beneficial from that? And how do you relate that over to your business,
Bob Magnan 12:12
It was all those those classes I took in college. No, it had nothing to do with my college. Education. Actually, I don’t remember go to classes, I played a lot of baseball in college, but very little class time. So I became a fan of Stephen Covey and the Seven Habits of Highly Effective People and went through a couple seminars, couple certifications around the certifications to become a, you know, become covey teacher, and the whole nine yards and what I what I really picked up from that experience was that you know, you can, you can, as a business owner, you can go out and buy anyone’s labor, their hands, you know, their backs, dig a ditch, whatever it is, you can go buy that, right. What you can’t buy is their heart, their passion, right. And that’s where the real magic comes from. When you have team members that are all very passionate about your company’s cause, they understand what that cause is, they have a clear vision of your vision. And then they understand the exact role that they play, and the responsibility they have in taking your company to that special place. It just becomes magical. And so that’s one of the requirements to work at our company. You know, if you’re not passionate about helping people, if you’re not passionate about helping our clients, if you’re not super passionate about being part of a team, that is going to be the best team on the planet, at what we do. It’s not a good word, it’s not a good fit for you, you know, it’s probably a place that’s not going to work out for you in terms of employment, you know, I would encourage you to seek employment elsewhere. Because on a daily basis, we have a passion about getting better, both personally and professionally. So we’re always challenging each other. And it’s, it’s, it’s seamless. I mean, it’s that my my team members challenged me on a daily basis. Bob, did you do your meditation this morning? Bob, did you get your run in the morning? You know, did you get your 20 minutes sweating this morning? You know, Bob, did you do anything for somebody else today? So we have these, you know, the criteria that we think make up what it’s, you know, what it takes to really be a highly effective professional and personal development type of character on a daily basis and, and we stick to it, and it’s a lot of fun.
Scott Peper 14:43
I really appreciate you share that story. How do you relate your culture and what you’ve done in your business? How do you carry that over into the recruiting side when you’re working on behalf of one of your customers?
Bob Magnan 14:54
We share a lot of the things that we do with our with our customers, such as You know, we kind of have a saying around our office, you know, you know, catch people doing things, right. And thank them, you know, give them a pat on the back versus a lot of companies, you know, you that we’ve all worked for that manager that, you know, hey, you know, you did this wrong or, you know, you should have done this way. And I understand there’s, there’s a need for that every now and then. But we, we, we like the culture of catching people doing things right and thank them. So to take off on that, that thinking and that thought, every Friday, we have a we have a lunch meeting which we buy lunch for everybody. And usually their night, you know, we have a nice lunch and, and we go over the week’s goals and how we did and plan for the next week. But we also have what we call is a silver box and silver boxes in our office and all during the week and the silver box. We have team members that put anonymous little statements in there about other team members. And on Friday, we pass the box around, everybody picks two slips of paper out of the box and read them. And it would say something to the effect of you know, if I’m reading one of those slips of paper, it would say, Scott, thank you so much for you know, all your hard work this week, coming in early, staying late. You were You’re a real difference maker, and everyone in the team appreciates it. And, and they’re all you don’t know who it came from. So So that’s kind of cool. Because you try to figure that part out, you know, I wonder who said that nice thing about me. But it’s just nice to get that kind of recognition. And we make it a habit. You know, every Friday, we go through that silver box. And I looked at before I came up here, there must be 100 anonymous, you know, thank yous and in the box are ready for this Friday. And it’s what Wednesday at, you know, 11 o’clock in the morning. So that shows me that my team is engaged, that they take that very seriously. And it’s important to them. It’s an important part of our culture.
Scott Peper 17:04
See, personally, I talked to construction contractors all the time. And I always talk to them about our business, because I want them to feel and understand that just because construction has certain connotations to it, or it’s harder work that that the business Business is business in, and your people are your people and all of these concepts, actually the ones that are the most important to whether your success, or is Matt, the way you want it to or not, is all these principles that we talked about. So even though your business is construction, recruiting, and you would hire someone would hire you to help find them the next best Superintendent they have for their job, what they’re going to get from you aside from a superintendent is awesome beliefs on how to make themselves more successful internally. And those are the additional value points that I think are so key. Getting to what you actually talked about there that when you and your actual business. One thing I’ve heard a lot of subcontractors say to me as Oh, I can’t imagine using recruiters when I brought brought you up or just a thought of a recruiter, they’ll say something like, Oh, those are too expensive. It’s too expensive to hire recruiter. And I was like, well, what’s expensive? And the answer I’ll get is up, they want X amount of thousands of dollar fee. And I said, Well, how much does it cost you? If you hire somebody and they don’t work out? They’re like, well, I just hire somebody else. And you know, I’m not equipped as well as you are to answer that question. But I’m sure that dialogue is something you’ve probably had before. And I think we’d be remiss not to touch on that here today. So if I were to ask you, why is your fee valuable? And why should the people just run to you to pay it? I know what I would say, and why I would do it. But what what do you what would you want a contractor to hear? Hear now. So while they’re watching this, so they say, you know what, he’s right, I need to just do this and say myself?
Bob Magnan 18:54
Well, the generally accepted, you know, facts about what it costs to replace an employee is somewhere around 75% of the person’s first year salary. So if we’re, if you hire a guy $100,000, or he only last six months, it’s going to cost you approximately $75,000 to replace that person. And so what what makes up that 75 grand costs are, you know, the amount of time that your team has to put into training that person, you know, you’re talking about, you know, 50 to 100 hours for this, you know, for the normal person just to be trained on systems, processes, culture, the whole nine yards of software. So, so that’s, that’s a big piece of it. In some instances, it could be a lot more. So there’s a there’s a hard cost to replacing somebody that you just can’t get around. And then, you know, most companies don’t take into consideration that. You know, they may be Great contractors, and they may have their area of specialty terms of construction, but it’s very difficult to do that and to be an effective recruiting operation as well. So most subcontractors at water to people in house, maybe somebody in HR, they’re not proactively out there building relationships, they’re actually just taking resumes in and hoping they’re going to find somebody that works out. Usually, their process of reviewing the resumes, doing background checks, bringing the person in for an interview, is is not that efficient and effective. So, so they’re making a lot of mistakes and Madden, and, you know, we eliminate all that noise, and all those processes. And again, our job because, you know, because our fees are expensive to a lot of clients, as far as how they look at it. Like, for 25, or 35 $40,000, whatever the fee may be, we eliminate, you know, the recruitment, the, the contractor having to go through any of that process, we make our prime contractors lives easier, we only deliver, you know, the best of the best the best candidates, because ultimately, our job is to help that company, go to the next level. And there’s not very many businesses that can take their company from A to B, without having difference makers, right. And those are one out of 100, you know, you know, employees that are out there in the pool, and it’s our job to find that person. So I think we had a lot of value. And I think our track record speaks for itself, you know, we’re entering our 14th year of business, we’re still growing at about 15% a year, and we’ve actually doubled in size in the last six months. So if I seem a little frazzled right now, it’s because we got a lot of action going on right now. So we’re moving into an almost 10,000 square foot office in less than four weeks. So a lot of exciting things happening at Delta. And we’re helping more clients now than ever.
Scott Peper 22:09
That’s awesome. You know, one thing I want to share with everybody that I wasn’t planning on, but it’s so relevant, I’ve made personally, so many mistakes, even here at mobilisation funding, especially here, whether it’s bringing in the wrong people having the wrong people on the team keeping them around too long, I can personally attest to you that the costs of making mistakes and hiring or keeping folks that aren’t a good fit, not implementing your culture, or just keeping people around, has caused me personally, probably hundreds of thousands of dollars, and even some, even some personal relationships. I think it’s also cost me opportunity costs of success are especially early on and nearly failure in many cases. Matter of fact, better luck. without some lock, I probably would have failed not had the business because I didn’t have the right people around me and I kept the wrong people around me too long. And if I could have shorten that gap going back if if nobody takes anything else from this, if I could shrink the gap between where I am now and where we started by literally paying, what would it what would be about less than 1% of the cost of the money that I probably lost, to buy Bob, to find me the right talent where I could have stayed on top of a situation that wouldn’t have become a problem because I didn’t have to do all the things I was doing. Or I didn’t get intellectually lazy in my hiring process and just check for a pulse and say, Oh, you sound good. Let’s do it. And we’re in a great spot. Today, we have a great business, we have a great group. But what we’re going to be in three years from now, I probably might even be right now here right now, if I had this advice, or watched what you’ve told me, and I took it to heart and implement it. One of the things I really want you to talk about, we when COVID hit like yourself, we decided that mobilization funding our team that we were going to, we were going to define ourselves in the most looking back at COVID. And say this is one of the greatest times of our company’s history. And what we did, when that happened, doubling down on what we were going to do, how we were going to help people integrating the business really challenging ourselves has made a huge difference for us. And we like yourself are in a great stretch right now and growing. And I think we’re helping people better and doing things even better. And I know you are too. Why don’t you talk with just from a business perspective as an owner, what you did when COVID came about how you used your your human talent, your team and where you guys are now what tell them what you did, because I think it’s pretty impressive.
Bob Magnan 24:36
Sure that you know, very specifically when COVID hat COVID first came out number one, as you pointed out earlier, we got lucky because construction was considered you know, exempt from you know, any shutdowns Basically, there were some sites that were shut down projects but you know, we were able to stay in business, which a lot of companies did not have that good fortune, whether you’re, you know, hair salons or whatever. So we got lucky in that sense. And we’re very grateful for that. But, you know, I went through probably about a week of being really angry at our government, you know, being pissed off and, you know, throwing a pity party for myself, Why me? You know, March was a march was the best month into 2020 in the history of my company, and then COVID happen. I’m just like, you know, this isn’t funny God, you know, this is bad timing, you know, I don’t appreciate your sense of humor right now. So I did go through about a week or so of not probably responding in the most positive way. And then whether it was my wife, or some divine intervention, or my team members, I saw it a different way. And I said, you know, let’s get aggressive, let’s get proactive. We’re going to go out, and we’re going to find 15 new clients, that’s our plan. And so we expand it. And, and, and sped up the process of opening up a few new divisions. So we have a general construction division. Now that’s really kicking butt. We have a mechanical manufacturing division that we’ve picked up 16 new clients in the last two months, we have an engineering division, that we picked up about 20 new clients in the past three months, and we’re opening up probably the biggest division of all, it’s going to be a renewable energy division. So we did all that, within the last six months, hired account managers, for each division, each division is making two or three placements 75,000 $100,000 in revenue a month right now. And so it’s messy, because we’re still in systems and processes and integration stages. But we’re sticking to our core values, which basically is, you know, continuously make our clients lives easier, right, as long as we provide the best of the best of the best candidates, to our clients or businesses like yourself, those leaders, those difference makers, make your life easier. Right. And, and that’s really where, you know, we get all of our repeat business from, there’s really nowhere else our clients can go to get the level of service and the quality of the candidates that we deliver. So that’s what we try to stay focused on, you know, always delivering the best candidate possible for for that search.
Scott Peper 27:35
A couple quick questions for you, before we wrap up that I was really interested in getting your kind of lightning round opinion on so to speak. The first or what is there one or two things that you when you talk into an initial customer of yours or client of yours that you that you say, you know, what, there’s one or two three things here, that really I can tell determine success or failure and in a client for their business?
Bob Magnan 27:58
You know, I love working with clients that are pushing themselves, whether you know, no matter what area of their lives, it may be, or their business, right? So they’re, they’re always committed to, you know, building the best project and adding the most value to their clients lives. And, you know, of course, there’s the fundamental, you know, we want to be around people that like to have fun. People that in clients have a high level of honesty and integrity companies that you know, want to hire you that are looking for a partner, and not just a recruiting company to make a placement. So we, you know, we go way beyond just making placements for our clients, we just we love working for clients that are really looking to become the best of the best at what they do.
Scott Peper 28:46
Is there any size company, whether it’s in revenue, or maybe employee size that you find are have a higher chance of success than others?
Bob Magnan 28:54
Well, we’ve helped a lot of companies, you know, go from, from 10 million to 100 million over the last 10 years. And so that was always fun to it’s always fun to work with smaller companies, because in the case of the company I just mentioned, we helped them find a general manager when they were very small. And that General Manager turned out to be a superstar. And he helped them grow a couple new divisions, and they’re in Chicago right now. They’re the largest merit shop electrical contractor in Chicago, and they’re probably gonna do 125 100 30 million this year. So that was a lot of fun to know that, you know, the one or two key employees that we help them find 10 years ago, are still there. And they built a tremendous company.
Scott Peper 29:39
What What about the companies that are a couple million dollars? Do you see that you can benefit them in the same exact way?
Bob Magnan 29:45
Going from one or two to 10? Yeah, sure. I mean, you know, our fees is a little more challenging for you know, a very small electrical contractor or, you know, any subcontractor or any company, you know, if you’re doing a couple million dollars in revenue So I’m always offering, you know, flexible terms and in fees to make it right, to make it the right fit for that company. And sometimes it’s a lot more fun working for a smaller company where you find a one person, and it helps them double the size of their company in two or three years. So I get a lot of joy, I get a lot of, you know, satisfaction. from doing that. We’ve, we help a lot of companies that do a billion dollars a year in revenue, you know, so anywhere from a couple million to, you know, there’s a few mechanical electrical contractors that do four or $5 billion a year in revenue.
Scott Peper 30:40
You’ve shared a lot of insight and things that I can tell are important to you and I think are really valuable. Is there anything that you wish you heard early in your career, that you go back and tell yourself right now that, you know,
Bob Magnan 30:51
Yeah, just whether you’re a mechanical, electrical general contractor, you know, the key, one of the key, you know, fundamental places, you know, things that you want to have a place is just surround yourself with the best possible people. If you’re the if, you know, if you’re the smartest guy in the room, you know, that’s probably not necessarily a good thing. So I like to surround myself with a lot of very smart people. And I wish I would have done that earlier in my career. I think my ego got in the way a lot and, and that cost me a lot of time and money.
Scott Peper 31:29
I hope you guys all heard that. Ego gets in the way. And as soon as you can park it speaking for myself personally, as well, as soon as you can park that ego is when you really see the success doors open up, for sure.
Bob Magnan 31:42
Well, I say stay humble and grateful for for what I have and appreciate of all the things I’ve got, you know, things go go pretty well. And I think more clear,
Scott Peper 31:53
no, I had another question for you. But I’m not going to ask it because there’s nothing more important than what you just said. And that’s the best way to end it here. But I really, truly thank you and your whole team, because I know it takes a lot to get us get this together. And I really thank you for taking the time to share your insights, your wisdom and your guidance. And I hope everybody got a lot out of this. I certainly did myself, I just appreciate you all taking the time to listen to us today. Bob, thank you very much for your time, your insights, sharing your team, thank you for what you’ve done for me. And thank you for what you’ve done for the folks that I’ve referred to you already. I’ve got nothing but positive feedback for them. And I’m grateful for that. Thank you.
Bob Magnan 32:30
Yeah, thank you very much for having me on, Scott. I really appreciate it and we got a big game six with the lightning. Probably tomorrow night. So go Tampa Bay Lightning. And I’ll see you around soon, Scott. Thanks again.
Scott Peper 32:46
That’s right. Go lightning. Thank you, everyone. Have a great day.
Transcribed by https://otter.ai