Any leader in the plumbing and HVAC business understands the challenges in keeping the costs low and the cash flowing.

For me, those challenges are multiplied by 14.

That’s because my employer, Leap Partners, owns and operates 14 HVAC and plumbing companies spread across the Southeast. We acquire successful companies and take on their back-office tasks like HR, finance and marketing, which lets owners focus on operating their branches and serving their customers.

As controller, my job essentially boils down to two things: support our branches and ensure that Leap Partners has the cash flow to fund further acquisitions.

I want to share with you the three fundamental lessons I’ve learned to achieve these goals: 1) standardize your processes; 2) find technology to improve cash flow; and 3) create a culture of trust.

Why standardization equals freedom

There are other businesses that acquire HVAC companies but let them keep their existing financial systems. The owners may think this lets them stay in control, but in reality, without standardization, they won’t be able to take advantage of the huge time savings that comes from standardizing.

We see standardization as freedom for owners. The more marketing, HR and finance off their plate, the more owners are freed to focus on selling, servicing, employee engagement and bringing in more business.

We’ve carefully designed our software systems around this goal. At the base is Sage Intacct, which we love because it’s user-friendly and adaptable. When I first joined, we used QuickBooks, but the process of ingesting new acquisitions was cumbersome. With Intacct, it’s easy to import the books and give the acquired company their chart of accounts, especially with Intacct’s templates function.

On top of Sage, we’ve layered Divvy for credit cards and Stampli for accounts payable. As you can imagine, with thousands of vendors across 14 companies, we have a huge volume of invoices. It used to take us 20 days to close the books, but now it takes 10 days, which I credit to Sage, Divvy/Bill and Stampli’s AI.

To round out our software systems, we utilize ServiceTitan. Our companies use this platform to start their jobs and have them flow into Sage and Stampli. This gives us a clear, apples-to-apples view into the real-time revenue that’s coming in.

Supporting standardization with AI

Everyone means something different when they talk about AI. To me, AI means automation and making our job easier — NOT replacing people.

Our primary AI tool is “Billy the Bot,” the robot mascot of Stampli. Billy does the most time-consuming parts of invoice processing for us: transferring information like vendor IDs and invoice numbers, allocating to the correct cost codes, and identifying who needs to approve the payment.

Most importantly, everything Billy does is checked by an AP specialist. Billy does the thankless work, while the humans stay in the loop — but with a lot more time on their hands.

AI is a learning technology, as opposed to automation that executes on pre-written rules. It easily picks up on even subtle changes in approval workflows or coding standards. That’s another reason why having humans in the loop is pivotal: their role is to teach AI, just like you’d teach a new employee. I’m now looking for AI solutions to other parts of finance, such as matching payments and sending outstanding statements in AR. Not to replace my people, but to let them truly tap into their talents.

Keeping our cash flowing

We don’t like debt. We like to fund our acquisitions through cash. In order to do this, we need two things: Control over inflows and outflows, and visibility into where our cash is coming and going.

ServiceTitan does a great job of helping me understand the activity coming down the pipeline, so I can predict inflows. For outflows, it would be impossible to predict cash flow with over 500 invoices coming in from 10 states without technology. It would also be extremely inefficient if we still had to log into all those different bank portal to copy and paste vendor details and payment amounts, like we used to. If I didn’t have technology like Stampli, I’d need to hire at least two more people to keep up with the workload.

It comes down to culture

When we consider new acquisitions, we look for exceptional leaders. In fact, we usually know we have found a good fit when the owner’s first question for us is about how we will take care of his or her employees. We have one of the leading owner and employee retention rates in the industry. We have accomplished this by empowering the former owners to continue running their business the way they think is best. Building a culture of trust is important to us.

That’s one reason why we are careful to roll out new technology. Many owners have been doing things their way, sometimes with pen and paper, for years or decades. Case in point: The field was very concerned when we switched from a monthly expense report to approvals for individual invoices. We needed a view of what was hitting our P&L without a monthly delay, but they hated the thought of daily tasks in confusing new software. This was a huge influence in our decision to choose Stampli, which was known for its ease of use.

And this approach paid off. We earned valuable trust once the field realized that this software was even easier than the old approach. Culture can’t thrive without trust, and our business can’t succeed without culture.

This year, we have plans to double in size again. Our software and investment in technology makes this rapid growth possible, and allows us to make the growth as painless as possible for our branches and our customers.