I probably should have posted something last year around this time about my ongoing involvement with Custom Development. So before I begin relating this saga, I should fill in a few historical blank spots. On a sunny morning in May, I agreed to meet Dino at the Denny's on Sunrise Blvd near CFF. Yes, the same gym where I encountered the young woman wearing grandma perfume. Anyways, the meeting was an opportunity to hear Dino and his old friend, Joe Sandino offer up a proposal to become partners in a relaunch of Custom Development. You see, up until that point, Dino and I had been operating CDC in survival mode, with both of us working out of our homes. I handled the accounting while Dino pounded the pavement looking for morsels of work to do. It was enough to get by but by last year, the economy had improved, housing prices were going up and things in general were looking pretty good for the home improvement industry. Just getting by wasn't good enough and I was up to moving on to something better. Over a breakfast of eggs and countless cups of coffee, the idea for a fully operational version of CDC began to take shape. Both Dino and Joe had gone through their own respective personal bankruptcies and stellar credit was not their forte. I, on the other hand, while sometimes scraping close to the bottom in my personal finances, always made sure that my bills were paid, giving me something valuable that they didn't have - a good FICO score.
The plan was for Dino and Joe to provide the experience and some initial start up costs and I would help get the company setup with vendors on my good credit. I was a little hesitant at first but I had known Dino long enough to know that the likelihood of me being left high and dry was pretty slim. Joe, on the other hand was an unknown. Dino introduced me to Joe and explained their connection. Joe owned a company called Weatherite which focused on residential window replacement. The crash of 2008 wasn't very kind to the home improvement industry and Weatherite came crashing to the ground. But 5 years had past and it was time to jump in the pool again.
Back to our meeting: Joe came prepared with his job profit and expense ratios. Jobs sold around 3X the cost and after deducting all direct expenses including commissions of 10% and lead fees of 16%, there should be about 24% left. Admin costs take away another 10% so by Joe's calculation, each job should net something like 12 - 14%. The idea was to divvy up this remaining amount as profit sharing with Joe and Dino splitting 80 and me taking the remaining 20. Sounds pretty good. According to Joe, anything over a hundred thousand a month would be gravy. After the meeting ended and my stomach couldn't hold one more sip of coffee, I agreed to go home and think about it.
The truth was I wasn't making much doing little piddly accounting work for Dino so I figured that nothing ventured, nothing gained would doom me to a boring existence and I was ready for a change. We rented an office/warehouse space in a seedy section of North Highlands on the cheap. I would have preferred something close, like that little space on Pyrites Way that Dino and I worked in for a little over a year beginning in 2009. But Gold River rental rates are a few notches above North Highlands and we were starting on a shoe-string budget.
At first things went pretty well. Joe seemed knowledgeable at least when it came to bathrooms. He brought over his crew consisting of Vasile and Nikolay. We gradually increased our volume. Joe's main job was to oversee the lead generation aspect of the company and insisted on receiving his fee no matter his department was productive or not. This began to place a strain on our arrangement since there were times that a job was a real loser and everyone else sacrificed in response except for Joe.
As for me, I handled the accounting like always and tried to save some cash for emergencies by transferring some funds into a savings account. Joe interpreted it as me hiding money from him which was really stupid and paranoid of him.
Looking back at this time period, that paranoia no longer seemed too out of character. As a general rule, I avoid politics, especially people with strong conservative views simply because they tend to be very difficult people to reason with. Joe began emailing me stuff about Obama - the typical crude, stuff you might expect from an Obama hater, i.e. communist, born in Kenya, socialist, etc. At one point, I was talking with him and he showed me an email on his computer and asserted that Obama was actually the devil. WTF? This is coming from someone who I assumed was intelligent, graduating from college with a degree in chemistry.
From that point on, I began to suspect Joe had a few screws loose and when he accused me and Dino of hiding money, the pieces began to fit together.
Finally, one day in April, 2014. I received an email from Joe saying that he wasn't coming in for the Monday meeting we usually had. In his long diatribe, he once again accused me and Dino of deceit and hiding money, both complete lies. In any case, the next day I walked into the office and it was nearly completely empty. Over the weekend, he had cleaned us out. To top it off, in his email, he demanded $10,000 as a settlement for outstanding amounts owed. After analyzing his ledger, Dino and I decided to pay him what he wanted since it turned out to be quite a bit less than what what was actually owed after all the jobs went through.
What an ordeal! I am so glad he is gone. He really was quite an asshole and since he left the company has been doing quite well without him.
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