If you're a heat pump contractor feeling burnt out, wondering if this whole electrification thing is worth the hassle, or questioning whether you can build something meaningful in HVAC — this episode is your shot of inspiration.
Stephen Hong is just over 30 years old. He's got a materials science degree from Virginia Tech. He's been running Electrify Colorado Mechanical for only a year and a half. And listening to him talk about heat pumps, you'd think he just discovered fire.
"Heat pumps are the pearl of HVAC," Stephen says, and he means it. Not because they're easy money or simple installs, but because they're challenging. Because they matter. Because when you get one right, you're not just fixing someone's comfort — you're making a real dent in climate change while working on what Stephen calls "the most immense responsibility" — people's homes.
This isn't your typical contractor success story. Stephen's path wound through disaster relief work, dead-end construction jobs, and answering a Craigslist ad from a guy who asked: "Do you want to help people stop burning dinosaur bones?"
Here's the thing that'll make burnt-out contractors sit up: Stephen is booked out six weeks, and he got there by being brutally honest with customers.
A homeowner recently asked him point-blank: "Are you the best?"
Stephen's response? " No, because I'm not. I'm too early. I got so much ahead of me and so much to learn."
Most contractors would've fumbled that question or delivered some generic sales line. Stephen turned it into his competitive advantage. He's not selling himself as the finished product — he's selling his commitment to getting better, his obsession with quality, and his respect for the work.
"There's about 5,000 things that we've got to get right from soup to nuts," Stephen explains. "And when we don't get one of them, it impacts your experience pretty significantly." He's run into 4,998 of those problems. The other two? He just gets them consistently right.
Listen to Stephen talk about refrigerant leaks, and you'll understand why he's different:
"If you have one of these larger Mitsubishi systems that leaks because somebody used an improper fitting... that's somewhere between 12 and 17 pounds of R410A leaking out into the atmosphere. That's like many years of using a furnace that you were supposed to be negating."
This isn't just technical knowledge — it's caring about the technical knowledge. Stephen gets excited about pressure testing at 600 PSI because he knows the system will never operate at that level, but testing there guarantees it'll never fail.
Most contractors see complexity as a problem. Stephen sees it as the fun part: "There's just so many parts of a heat pump install that are nuanced and complex. And doing it right is really important."
Here's where Stephen's story becomes pure inspiration for anyone feeling overwhelmed by the pressure to scale fast and cut corners.
"I really would like to grow slow... I'm also not going to hire and pay people like mid to low tier wages. I'm just not going to do that."
Stephen watched companies fail by expanding too fast, spending too much, hiring wrong. So he's doing the opposite. He's got the funds to hire a lead tech, but he's waiting for the right person. He'd rather do excellent work with a small team than mediocre work with a big one.
His 5-10 year vision? "If I can get up to 9 or 10 licensed guys and the trucks to support that and have that rolling where we are consistently booked out 3 or 4 weeks... I would be so proud."
Not IPO dreams. Not a private equity sale. Just solid, sustainable growth built on quality work and fair wages.
What really sets Stephen apart is how he talks about the work itself. This isn't just about installing equipment — it's about being trusted with something precious.
"It's so immense of a responsibility from start to finish... It's an honor to work on people's homes."
Stephen gets it. These aren't just HVAC systems — they're in spaces where families are raised, where memories are created. That perspective changes everything about how you approach the work.
He brings customers into the technical details not to show off, but to build trust through transparency. "Our job is to bring the homeowner in and completely make it transparent again." When customers understand the "why" behind pressure testing, proper refrigerant handling, and quality ductwork, they don't just hire you — they become advocates.
Stephen's honest about the challenges. He worries about competitors who lowball with bad installs: "For every person that gets a bad heat pump install, they're going to tell 20 people." He's afraid bad work could poison the entire market.
But here's what's inspiring — these worries come from caring about the industry, not just his bottom line. Stephen wants the whole sector to succeed because he believes in the mission.
And when projects get complex? He asks for help. He brings in mentors like Bill Lucas. He partners with great electricians. "You're only gonna drown otherwise, because nobody can do this all by themselves."
If you're wondering whether it's possible to build a thriving heat pump business based on quality, honesty, and sustainable growth — Stephen Hong is proof it works. In barely a year, he's gone from solo operator to booked-out contractor with a waiting list, and he did it by caring more, not cutting corners.
His advice for anyone starting out? "Just be human. Treat people really well... Don't get run over, but just love it. You're in somebody's house and it probably cost somewhere between $300,000 and $5 million. So treat it with respect."
Stephen Hong isn't the best heat pump contractor in Colorado… yet. But he's building something that matters, growing at his own pace, and having a blast doing it. If that doesn't get you fired up about the possibilities in this industry, nothing will.
[00:00] - Introduction
[02:45] - Meet Stephen Hong and Electrify Colorado Mechanical
[04:26] - Stephen’s path from engineering to disaster relief to HVAC
[17:24] - The 5,000 details that make or break an install
[22:48] - Building trust through radical transparency
[30:40] - His vision for growing the business — slowly and sustainably
[37:02] - Stephen’s advice: Be human, ask for help, respect the responsibility
[00:00:00] Stephen Hong: This is the most expensive thing in your house that you don't enjoy aesthetically, basically. And some people do enjoy their hair, you pump aesthetically and that's great, but for the most part we are better invisible. And the communication to the customer that look, I'm basically asking for a percent roughly of the value of your house. For a lot of people or something of that magnitude. And that's a lot. That's a lot of money.
[00:00:31] Eric Fitz: Hey, everyone, this is Eric from amply. Before we start today's episode, I want your help with something that's really important. In fact, it's critical to our mission. We can't make heat pumps a no brainer for contractors and homeowners, unless we have really great people on our team to help us achieve it.
We're looking for a senior IOS engineer, and we think there's a good chance the person we are looking for is somewhere in this collective network. Maybe it's you, maybe it's someone you know. Maybe it's someone who knows someone you know. Here's what makes this role special. So, first Amply mission again is to accelerate the adoption of heat pumps and more importantly, to make sure that those heat pumps are perfectly sized and designed for each home.
You might even say to make sure that those heat pumps are sized amply. So heat pumps are the key to residential decarbonization. And to make that possible, we need another software engineer who's ready to tackle this challenge. So if you love or you know someone who loves really hard problems in user experience design, spatial computing, building science, mechanical engineering and augmented reality, and they love working with a small but mighty team that makes fast decisions.
Let's talk. So our product is really catching on with customers. We're getting fantastic feedback. And we keep hearing that our users want more. You know, it could be a totally new capability or a refinement of existing feature. Our customers are clear about what they need next. And we know exactly what we want to build. So you'd be joining at this perfect inflection point where product market fit is happening and there's this clear roadmap. So again, we're specifically looking for an iOS engineer with Swift and Swift UI experience, someone who ideally has built apps from concept to launch and who loves creating beautiful and intuitive experiences. So if you're listening, here's how you can help us. First, the job spec is the very first link in our show notes, so check it out. Share it. Second, if you're on LinkedIn, I've pinned the job spec to my profile. It's also pinned to Ed’s. So feel free to share wherever your network hangs out. All right. Thank you for listening. Thank you for taking the time to give us a hand with this. Now, let's get on with today's episode.
[00:02:14] Ed Smith: Hi and welcome to the Heat Pump podcast. I'm Ed Smith.
[00:03:43] Eric Fitz: And I'm Eric Fitz. We are co-founders of AMPLY energy.
[00:03:45] Ed Smith: So today we have Stephen Hong, the owner, founder and chief everything officer at Electrify Colorado Mechanical. Welcome to the pod, Stephen.
[00:03:56] Stephen Hong: Thank you so much for having me guys.
[00:03:57] Ed Smith: Appreciate it. Glad to you. All right Stephen, we're going to get into your story. But before we do, give folks a two minute overview. What is Electrify Colorado mechanical?
[00:04:08] Stephen Hong: Electrify Colorado Mechanical is a company I started with a co-founder of mine in December 23rd, and we've done something like 40 cold climate heat pump installations since our inception. And then I bought the company outright in November of 24. And so now it's just me. But huge props to my former co-founder Brad Johnson, who I owe a lot to for helping us get off the ground. And now it is just me and our single W-2 employee. But we focus on cold climate heat pump installations in Denver, Colorado and the metro area in Boulder. And yeah, we just advise take the whole home approach to heat pumps. But if we're doing water heaters, electrical panel upgrades. That's all just tagalong product. But we are really laser focused on heat pumps. We'll do furnaces in homes that need them, but really not leading with a furnace almost any time.
[00:05:06] Ed Smith: Awesome. So that summarizes exactly why we wanted to have you on the pod. And also, I love talking to someone who's really at the start of their journey. We try to have people on who are at all aspects, and you've been in it long enough. You're going to have some bumps and bruises and some scar tissue, but still got a lot ahead of you, which we're excited to talk about. All right. Introduce you. You've got an engineering degree from the top engineering schools in the country. Give us a little bit about your path and how you got to founding running Electrify Colorado Mechanical.
[00:05:37] Stephen Hong: Thank you. The engineering background has helped immensely. Obviously, it's a lot of understanding building science crossover with the material science and engineering degree that I have. And it has really always been something that just opened a door where people trust you to be able to learn things. I got the fire for operational type stuff while doing disaster relief for this organization called All Hands and Heart, and that was phenomenal because they just give young people a lot of responsibility, but you make a lot of impact. And my contract ended right as that pandemic kicked up. So I moved to Denver, Colorado and just honestly worked a lot of different kinds of construction. That was not glorious for a long time, and was at a point where I was just so burnt out and feeling like nobody in construction really cared about the planet, or doing something that was like, bigger than ourselves. And so I had quit a job, and I answered a Craigslist ad by this guy named Bill Lucas, and he is just an absolute pro doing passive House stuff for 30 years. And he wrote an ad that said, do you want to help people stop burning dinosaur bones.
[00:06:54] Stephen Hong: And I gave that guy a call because there's just. No. It's so authentic. It's so real. It's so dorky. It had to be real. And we had a 15 minute conversation about what is HVAC and what is electrification, and brought me into the fray. And I started as an installer at this company, Healio home. And over the evolution of about two and a half years there just really became immersed into this whole electrification thing. But I also love to talk about the whole electrification versus whole home performance. And your podcast, honestly, is something that has really turned me on to that different focus. And anyway, so I'm just a guy who's gotten to do a little bit of everything so far and then really took the reins sometime last year, and it's been a lot of fun. I'm not gonna lie, it's hard, but it's a combination of setting the bar really high and really working to achieve that. And happy customers are happy customers, so customers. That's the goal throughout. And I can honestly say for the first time I'm like, booked out for a month and a half. That's amazing. I didn't.
[00:07:59] Ed Smith: Congratulations.
[00:08:00] Stephen Hong: Couldn't have imagined that. So I'm just like, yeah, I'm hitting a point where I'm feeling very proud, but also taking absolutely nothing for granted. Every customer is still really important. And yeah.
[00:08:11] Eric Fitz: Stephen, I'm curious. You've got such an interesting background and passion. What are some of the things that really drew you to the mechanical systems as opposed to more of the building envelope? Yeah. Tell us a bit more about why heat pumps in particular?
[00:08:27] Stephen Hong: Sure. I think I said this to Ed when I first met him. Would he pumps her? The pearl of HVAC is the pearl of this whole thing, and you can generally put one in every house. We have a lot of homes that are built 1900 1923 this brick homes that if we're not ripping out the whole wall, there's no way you're insulating that wall. And I just never took a job in insulation. That's probably part of it. I think I would have been really turned on to be an energy auditor and stuff like that. That would have been really cool, but it just didn't cross the path that way. And huge respect to the people who are doing that work because yeah, on the face, it's not a super complicated product, but it's actually really the interface of like most of these complex building science problems that people run into all the time. We have like less issues than probably the rest of the country in terms of dealing with humidity, but which I am thankful for, that it's very dry here. Keeps your food from going stale a lot faster. It's just a little bonus. The reason for heat pumps, I think, is that it's just such a big dent in your carbon impact, really, when you. We already have a grid that is 50% renewable.
[00:09:43] Stephen Hong: At least that's what is the annual average here when you're served by Xcel Energy. And so if you can replace just your furnace, that's like minimum a ton and a half to two ton CO2 equivalent emissions every year, which is great. And then there's just so many parts of a heat pump install that are nuanced and complex. And doing it right is really important. Where when we think about leaks on heat pump installations, for example, if you have one of these larger Mitsubishi systems that leaks because somebody used an improper fitting and something like that, that's somewhere between 12 and 17 pounds of R4 ten a leaking out in the atmosphere. And that's like many years of using a furnace that you were supposed to be negating. That has no longer been done. So I don't know if it's so much the machine itself, but really the fact that the quality is so important to it and that we've really only hit this precipice in the last 5 or 6 years where we can really tell the general public, Now, pretty much no matter what your house looks like, we can come up with some version of an all electric option for you where you can stop burning natural gas. And if you do enough things to your home, we can really build a project for you where you have completely transformed your energy profile of consumption, energy profile of your home.
[00:11:07] Stephen Hong: And I think I just, I like the challenge of the retrofit. And like certainly there's a lot of things about doing these all electric systems that are different than doing even a dual fuel system that make it harder. A lot of these cabinets are huge in comparison to your furnace and dual fuel combo. So I don't know. It's just it's always a fun challenge and everything's a little bit different. And I think that helps with the way that I carried myself. I interact huge respect to people who can do head down computer jobs and design software. And thank you, employee energy for your little product. But oh man, I would not be good at that. And I think I knew that coming out of school, to be honest with you, is that also led to the diverging path from do you want to go be a standard engineer or do you want to like, yeah, I don't know. I'm lucky to have been where I'm from and get the education that I have. So being able to like, branch out beyond that and be trusted, that I could learn that I could go beyond that is has been a really something I'm really blessed for.
[00:12:10] Ed Smith: That's awesome. Yeah. So I'm getting a sense. All right. So, engineer, you went to work at a disaster relief nonprofit. Yeah. That. Yeah. You got to be super hands on. So inspired by mission, what you like to do, what happened? And then you worked a bunch of jobs in construction, but lacking that mission aspect. Tell me more about what happened after you answered that Craigslist posting. That it seems like you went into that with the raw stuff, and then that experience that Helio forged you into an HVAC entrepreneur heat pump entrepreneur. That's not obvious to me. Tell me more about that experience.
[00:12:48] Stephen Hong: Yeah, I've got to thank just people. That is just pure being able to be mentored by people like people professionally, people purely within HVAC, people that are giving me this confidence. Yeah. You can just create something that you decide should exist. That sort of gumption to it. I think I know people who really have shown me that they are successful doing or perform all those different kind of traits, and being young enough and exposed to be able to take that on has been so helpful. So yeah, Helios was the company where I became someone that is interested in electrification, and the goal is so lofty. That's so great when you're learning it, because you get to be told that, yeah, this actually could be the biggest change in the way that we consume and heat our homes and we interact with our homes. And by the way, they're also way more comfortable, just that whole piece of it, than there's a million benefits to what we're doing here. Hey, do you want to learn how to design solar here? Let's teach you how to design solar. And you're going to now create the whole electrification package for these houses. And it's going to be based on this data set and photos, home assessment.
[00:14:06] Ed Smith: And so I didn't tell people what Helio was because you've hinted at it. But I think a lot of our listeners won't know.
[00:14:12] Stephen Hong: Oh yeah. Helio home was a whole home electrification contractor. Everything was done on the subcontractor model by the time that I stopped being an installer, to be fair. So it's a lot of create a plan that changes. And I think that's where I really understood the value of the in the field operation is like getting to see so many plans for electrification and seeing so many heat pump plans, and then having them run into obstacle after obstacle and seeing what it was like. If you start with subcontractors who are really like furnace and AC driven people, and you try to switch them over to be heat pump contractors, and where's that like friction and where do things get missed and what are the quality concerns when you transfer and you try to change the product a little bit? Yeah. But all the stuff.
[00:15:09] Ed Smith: About.
[00:15:10] Stephen Hong: Design and spec is like really straight. Spending time with my mentors who just really were like, great, this is the energy models. These are rules that we follow. These are things that you can be thinking about what it's going to be in the wall frame. And I mentioned homes that are completely brick, and they might have an attic that could be insulated. And maybe they have a crawl space. And just the general rule of thumb, when we go outside, what do we put on first? We put on a coat. We don't put on a hat or boots first. We'd ideally like to be putting on coats in these houses or for these homes, but instead. Really, the best we can do in some of these, like 1000 square up, 900 square foot basement maybe homes in the nicer areas of Denver are hats and boots, and that's crawl spaces in attics. And then you got to make the HVAC system work for them afterwards. And that's like how you get into equipment selection. And by the way, how big is it to get in that crawl space and what's that door like and how big is the cabinet. And I tell customers today there's about 5000 things that we've got to get right from soup to nuts. And when we don't get one of them, it impacts your experience pretty significantly, because all of those 5000 things are really important. And I was lucky enough that over about two and a half years, three years there and then my time so far running this company that I've run into about 4998 of those things.
[00:16:33] Stephen Hong: And the other two, I just get consistently right. So I'm doing as best as I think I can do for the experience that I have. But the customer that I just worked for that came from their house today asked me during the sales consultation, are you the best? And I said, no, because I'm not. I'm too early. I got so much ahead of me and so much to learn. There's no way that I'm the best. And maybe one day I'll be the best. But a really great guy in the heat pump community here had said to me when I asked him, should I start this company? He said, to be honest, even if you can be above average, you will be so good. And that is a little bit telling about the state of labor here, the state of what quality and what the bar is here. And I'm hoping that in my own way that I can raise that and meet it and exceed it and teach other people to do the same. And I think it's working so far because the customers who I show like this could be your heat pump experience. This could be a very bespoke thing for you, and it goes well. And we are in their business and we get to do their project. And I'm like super, super thankful for the opportunity to transform people's HVAC systems, make recommendations on their homes. And yeah, to be trusted like that is it feels amazing.
[00:17:52] Eric Fitz: Yeah, totally. It's a big you've touched on this a little bit before we started recording that you're going into someone's home. This is where they raise their family. This is where memories are created. It's their home. And your responsibility is to very first thing is don't screw it up, both for your own sake as a business. And also these are humans. These are people you're trying to help out and make their life better. And so you've absolutely got to treat people with respect and honesty and your own due diligence to make sure you're doing the right thing for their home, for the project. I'm curious, you mentioned there's 5000 different things that you have to watch. What are a few of those most important things that maybe you learned from your previous experience, that you watch out for now with your business this? And just to share a couple of examples.
[00:18:41] Stephen Hong: Sure. We do not move on from pressure to vacuum until we are positive. We are not leaking anywhere. That's the biggest thing for me because that's where your carbon emission, or at least equivalency comes from. That's your greenhouse gas leak right there. That is the thing that is going to damage your compressor. That's going to limit the lifetime of it from you want to install a 20, 25, maybe 30 year product. That would be help that the products that I'm installing are still in service in that amount of time. So the core fundamentals just starting with the refrigeration circuit and getting that right and weighing in the appropriate charge and doing that correctly and handling the refrigerant and recovering it and bringing it back to the distributor. And just like at the distributors, there's a lot of companies that just drop off their condensers to the scrap guys that pick up everything, and who knows how many of those condensers are like, just got pumped down and got sucked full of like 3 or 4 pounds of R4 ten. Because in reality, like, people aren't policing that. There's an enforcement agency out there. But like in practice, like it's more or less the Wild West. And if you meet a customer who is switching to a heat pump in at least part for environmental concerns, aren't you doing them a significant disservice by not going through all of the things that you can do, and showing them that you are doing all the things and that kind of gets into like, how do you level with a customer and go your value, right is like, you got to I think at least I like want to bring people in the nitty gritty in the technicalities of things.
[00:20:21] Stephen Hong: And I like explain what the pressure test is for and explain how it works. And the machine is never really going to operate at 600 psi, but we're going to test it to that. And that's how we really know that this is never going to pop. I don't know, it's just like we are so much more than contractors. When we're doing this right, we're like people who are trying to make a dent in climate change. We are stewards of the values of the people who are hiring us. Eric, exactly what you said about people's homes. It's so immense of a responsibility from start to finish. Yes, like the basics. That's a good answer, I think, just on its own. But like the best advice I got recently was Stephen, people don't know how this works, so it has to look good. Otherwise they're going to think it's not good. And that's so true. Nobody gets how this works.
[00:21:08] Stephen Hong: But if your duct work is nice and square and tape really nice, and you've got mastic at the right places and it just looks better, then people take a look at it and they go, oh good install if it is it charge. Did you hook it up with a thermostat that is actually going to give it the efficiency that it should. And you can bring the customer into all those points too. But we live in a world where people take three pictures of a whole install posted on Reddit and go. I paid x. Did I get a good deal? And then people roast you or don't. Or tell you that you're, like, the best contractor ever. So you got to be ready for that. And especially where we have a field where we have so many things to know and homeowners don't really know this stuff. I say there's this black box, and our job is to bring the homeowner like and completely make it transparent again. And if you can communicate the value of doing all of those things, it's like good bends in the refrigeration lines and just like making it, you got to make it pretty. And when you do, things will be hooked up. And obviously you do your all your wiring checks, things like that.
[00:22:15] Eric Fitz: System install commissioning. It's wicked important. Absolutely. Yeah. What else. Maybe a little bit further upstream. Do you do as part of your consultation? What is your design process look like as well? What have you learned here?
[00:22:28] Stephen Hong: So being a one man company, if I've got 4 or 5 quotes out, that might mean that I have 4 or 5 conversations that are going to last anywhere from an hour to two hours about the quote that I've already presented them. Right. So I'm already sunk a few hours into this project. So what I started doing is basically communicating as much information about a systems design as I possibly could up front, and not making the customer feel like they have to be on the phone with me for 90 minutes to get all that information. It's not a we schedule the time to speak, and then I send you the quote ten minutes before and now I'm like, got you in this failed manipulation here. Here is everything that I think you're going to need to know. What questions do you have? And then we get into this thing. And by that point, I'm hoping to build the sort of trust that is built on the transparency and the information. And that includes everything from like, how does this system work and what does your thermostat look like to what are the rebates and incentives, and how do those work so that the customer really gets a full encapsulation of, hey, this is project who's going to take 2 to 3 days? I need to block out whatever time on my calendar.
[00:23:43] Stephen Hong: Do you not need to be available? I do need to be available, whatever it is. And like that theme to give people the feeling of empowerment, of okay, I am choosing to do this for my home now. Not like I'm picking the contractor who just has like full scope over everything. That and I don't know what's going on, but I'm just going to trust him because I'm a little young for that. And I get if people don't really want to hand me just to keep their house instantly, that's completely reasonable. Yeah. Bridging the gap by information is the distinct way that I would say that is, if you can deliver as much information about quality and equipment spec. And what did we learn about your home on your home assessment then? Look at that. Now we've got somebody who feels like I understand their home and therefore understands what they want, and now they're willing to do a project with me.
[00:24:35] Eric Fitz: It's so important to bring the homeowner into the process. So they hear that and can see that you understand their problems, their challenges, their goals, and then you can present a solution that's going to solve those problems and going to work with your budget and all those other pieces. But if you start with just like throwing solutions at people, when you don't, they feel like you haven't actually heard their problems. It gets real tough.
[00:24:59] Stephen Hong: Yeah. How many times have you met a customer who eventually decides, actually, I'm going to go with the most high end thing, and it's unexpected. It happens. You don't give people all the information, then you don't really unlock the ability for them to make that choice. It's harder to discern between a mid-grade heat pump and the high end model if you don't explain at all, and I do mid-grade heat pumps like I'm not fulfilling them, I would much rather someone get an inverter driven Gree system than get an AC. What a waste that would be.
[00:25:29] Ed Smith: I'm getting a strong sense both from what you're saying and how you're saying it. How a conversation with Stephen Hong would be a very different kind of HVAC sales and install and post install experience that's very much coming across. And I find myself wondering, where do you want to go with this? So you're like a year and a half. You're like a year and a half into this, right? And I could see talking to someone who's a year and a half into it with no sort of experience like you had before, being like, oh my God, how quickly I can get out. But I get the sense that, like, your passion is even more ignited now than it was 18 months ago. So, like, where do you see yourself 5 or 10 years with this company?
[00:26:09] Stephen Hong: I'm just trying to get to December. I'm trying to get to these homes here. Rebates and expand the workforce. We got to do that. The person that I've hired is James Anthony. He's phenomenal. He is 20 years old. He shows up a little bit early. He doesn't vape. You cannot ask for more out of a kid in construction these days. And if I could have four Anthonys in a year. But there aren't for Anthony's, I'm pretty positive, unfortunately. I really would like to grow slow, as people have impressed upon me as important to do. And to be honest, I'm a little bit scarred from my time at companies that have not succeeded to expand and to spend tons of money and to agree, like to hire. But I'm also not going to hire and pay people like mid to low tier wages. Like I'm just not going to do that. That's not what I was paid when I got brought into this, like I was treated very well. I'm going to treat my employees very well. And so like I need probably a little bit more to be honest. I have the funds like to hire the lead guy, but I'm just nervous to do it. Be honest with you. But it's going to be interesting to get over that hump to go from. Right now I have one full van, like for like install service. What have you making that jump? Okay. Now we have a sales vehicle and a van and the crew is running on their own, and now I'm just doing project management and let these guys go.
[00:27:35] Stephen Hong: Guess what the like 30 year old who decided he was going to run the heat pump company all by himself is like, not that good at letting go of control. So it's going to be a tough ride. So when I look at people who have grown their heat pump company and there are a couple like in Denver who I really admire that are heat pump focused and are not subcontractor based, who really took the time to hire guys and train and they own that labor warranty themselves on every project. That's really the goal. If I can get up to 9 or 10 license guys and the trucks to support that and have that rolling where we are consistently booked out 3 or 4 weeks and we just have that rolling, I would be so proud because ultimately that's eight, nine, ten times as much work, probably more because let's be real, guys who have been doing HVAC for seven eight years, they're a lot faster at this than me. It's just going to multiply the impact a lot better and we can pitch in it. There's an incredible amount of work to do in this field, and we're just doing one aspect of it. I have definitely been inspired by the people you have all brought on this podcast about whole home performance contracting and the idea of taking on windows and siding and insulation and solar is phenomenal.
[00:28:54] Stephen Hong: And I have partners for insulation, for solar, for electrical and plumbing. But I'm really keeping my scope within heat pump water heaters and electrical and heat pumps. And if it's solar like, I will pass you. But my job is to gain your trust, inspire you to get a heat pump, get us all to agree that I'm the right guy for the job. And if you get solar with the person that I think you should get solar with. Phenomenal. But to be honest, I don't want $1,000 on your solar deal. I want that to go into your general electrification budget and you have to decide where does the money flow. And that's the name of the game that homeowners in Colorado get to play right now with our fantastic incentives. How do I leverage the timing of things to increase the delta that I would pay in utilities, and what I would pay in equipment upgrades and getting people to map, that is, I don't even have the like the spreadsheet to send out for that, to be honest. But like I have visions of all that, but practical. First I just we're dealing with refrigerant change over here. I just dropped like $5,000 on refrigerant. I could not believe that when that, but it's the only way to get my projects done in the next three weeks is to buy the giant containers. So we're doing it. Let's go. Yeah, I don't know.
[00:30:14] Ed Smith: The grow slow insure quality mentality is one that is deeply ingrained in Eric and I to one of our core values. It is slow, smooth and smooth is fast. And we just put a job posting out. We're hiring another software engineer, and one of the things we had and was like, move fast and break stuff just doesn't work for us because these are people's houses. Yeah. Employees helping design systems for people's houses. You're in people's houses like that. Might have worked for Facebook or like it might not have, but they had it as a core value. It's just it's not one for us. So that's yeah, that resonates deeply. And I applaud the mentality.
[00:30:47] Stephen Hong: Yeah. There's enough broken stuff too. We don't need more stuff. Let's fix stuff.
[00:30:52] Eric Fitz: Totally.
[00:30:52] Ed Smith: That's a great line. Yeah.
[00:30:55] Eric Fitz: I'm thinking I applaud you because it is no small feat to go out and just take on the risks that you're doing and just know that you love learning, that you've got some skills and just to go for it and be yourself and build this business. It is not for the faint of heart. It's a very hard thing to do. And honestly, Ed and I feel the same way a lot of the time where we're like, man, we're doing a lot of things great. There's definitely some challenges. Let's just let's just make it another three months, and then hopefully we'll have a little more knowledge at that point. And then we can figure out these other these next questions. We don't always know where exactly we're going and how it's going to play out, but we just open to ideas and we work together to figure out how to build the business. So I'm curious not to turn to more of a dark place, but what's keeping you up at night now that you've made it? You've made it this far and you're it's just awesome that you're booking out 4 to 6 weeks now. What are you worried about over the horizon here?
[00:31:51] Stephen Hong: Super long time. I'm worried about the competitive quotes that I run into, or that I don't see that set people up for bad heat pump installs and experiences. Because for every person that gets a bad heat pump install, they're going to tell 20 people. And that makes it really hard for us to go from we've left early adopters. I think we can all agree we're in like this upswing here and we're not leveling off yet. I don't think at least my staff doesn't. I'm genuinely afraid that with enough bad installs out there, it could poison the market, and that would be really hard for me to deal with. I'm up at night thinking about the unknowns of every project. That's a really tough thing, and I was really not sleeping well last year when I had not had enough experiences where we just work it out. Now I'm in a more comfortable place to have the confidence to say, yeah, we will work it out, or that it's okay to take longer than what we planned to take to do this. That was the other thing that I was just really struggling with was these prime lines, and especially doing heat pumps in the winter in Colorado, you have this overarching urgency of getting some of these heat back on after you've taken down their system.
[00:33:10] Stephen Hong: And that's why doing ductless is just so great, because if they've got a boiler, then you're cruisin. You can take as long as you want basically. But on a more like where what am I worried about for the company is there's just still so many things that I don't really know how to do. And hiring is one of them. I got pretty lucky with Anthony that he came out of a local tech school, and just the kind of personality that really works, and he just really is a solid individual. But not everybody is like that. And getting to navigate that is going to be really tough, because inherently I'm giving responsibility to people. And that's just a hard thing for someone who is working to own the whole thing to do all the time. The daily things about, oh, like, equipment took longer to get here or like the schedule. And that's all stuff that you just learn to work out over time and it'll be okay. But I gotta give a huge hand to my primary electrical partner, which is Envision Solutions, because it's really important for a good electrification contractor to have a great electrician and someone who takes all of the stress away from what needs to be done electrically for me. And finding good partners and rewarding them properly, and letting you letting them know that you appreciate them, building those relationships and holding up your end of things.
[00:34:48] Stephen Hong: When push comes to shove on those deals and being the face with the customer so that they get that aspect of that business started is one way that I can help uphold my end of that. But I have to be tremendously thankful that I still have a lot of mentors in the HVAC space, particularly this guy, Bill Lucas, and to some extent, Clay Jaiswal of Rocky Mountain Heat pumps. It's GP3 and Rocky Mountain heat pumps for teaching me so much and for being able to be 1099 labor on my job with me. And next week we're putting in we're replacing a furnace AC in the basement and a furnace AC upstairs with a two air handler to one. That's the dream, right? You like love to get rid of two systems, replace them with one. They're both massively oversize. This guy is going to be dialed in, and not even the two heat pump systems might have been like, not great for low ambient cooling. And this is just going to work better. And honestly, to do two air handlers and an outdoor unit with a custom stand setup and like funky line set roots in 3 or 4 days, like for just me and 20 year old who's had five months of HVAC experience ever.
[00:36:03] Stephen Hong: That's a big ask. So I need some help. And like where I want to just bring that point to is like learning that it's okay to ask for help in all of this where I am today as a result of asking somebody for help, hey, I need a space. I don't have an office, folks. Like, I just got into a co-working space today because the company also does things like for my business and like, great, phenomenal. Just reach out and ask, but you're only gonna drown otherwise, because nobody can do this all by themselves. And that's the really hard lesson I think, that I've come up with is like when I'm at the points that are the lowest, I think, in the whole HVAC experience, it's because I'm trying to do it all without anybody's help. And then when you reach out and you get to problem solve together. Oh, wow. You've seen this before. Great. I don't know, it keeps you in the mindset of you need to keep learning forever. Like forever. In this job, there's no. Imagine if some HVAC guy that came to your house and was like, nope, I learned it all. No way. Like, it just doesn't make any sense.
[00:37:09] Ed Smith: Stephen, you just this conversation. I'm so enjoying it. Because whatever. I don't know, Eric. When we were trying to raise money from venture capitalists, but it was like three years ago. They all said no to us. It was the best thing that ever happened to us, that we didn't raise money from venture capital. Like literally the best thing that ever happened, but would go in and we'd talk about what we wanted to do. And target market was heat pump entrepreneurs and electrification contractors and hear all those exist. Is that like a big enough market? Yeah, exactly. It's you like 100% like to hear you tell this story and like your enthusiasm and like it's you. And yeah, it's just super fun to hear the story, to hear the enthusiasm, to hear the realism. Like not sugarcoating anything. You're like, look, sometimes things are hard. The fact that you said to a homeowner who asked, who are you the best? And you were like, no, it was like maybe the greatest thing I've ever heard. Thank you for that, Stephen. It's like super fun on this topic of asking for help. And so I think it's a good place to wrap. So our final question is always for someone just getting started, it's cool to talk to someone who's in their early days like you, or trying to grow and wants to focus on building a heat pump oriented or home electrification business. What are some resources, mindsets? Whatever. That are great sources of information that you would point people to?
[00:38:22] Stephen Hong: I'm so spoiled that I have been taught by really some of probably the best minds in the local area for this. How do you get in touch with the people in your area who are doing this work, and how to absorb it and learn from it and grow? I don't know, you just I'm so lucky. I really like that's the thing is that I want to get across, like through my whole life. Like a really good public school, a really good public college, not saddled with a mountain of student debt so I can go and work for this nonprofit where they give you all this responsibility, and then you get shaped into somebody who just decides to do, and then you run into the right guy. I don't have a good book for you to read that teaches you that you can't read New Power and be like, oh, wow, I don't know. I know, I'm just so incredibly fortunate to be who I am and to be like placed in time where I am, because I've learned just so many good lessons about customer service and how to treat people that have nothing to do with selling a heat pump. I don't know, I would say like I've run my whole business by being really customer focused and just by thinking about what do I want someone to feel and like to think about when I'm working with them, working for them. And if you can just find something that is intriguing or find a very high touch customer service experience that you can then start to develop.
[00:39:55] Stephen Hong: All right. Why do we do these things that will lead you in the right direction? One of the best lessons that I honestly learned was that the truth and someone's experience are don't have to be the same thing. And I don't mean that in a way to say lie to people. I mean that in a way to say that if someone feels like they have been wronged or put down or ignored, you need to recognize that and you need to feel for them, and you need to address that and bring them back to a place where you're aligned again, because that's what you want. You want everybody on the same team when you're doing these projects, and there could be no adversarial aspect of the heat pump installed should never be like the homeowner versus the contractor. The contractor feels compelled to do something against standards and best practices because the homeowner just wants it to be like that. You got to bring everybody on the same side somehow. That's how you get to success. I hope it's working right now. We'll see. There's a lot of things in flux. But yeah, I don't know. Just be human. Treat people really well and I don't know. Yeah. Don't be too soft. Don't get run over. But just love it. You're in somebody's house and like, it probably cost somewhere between 300,000 And like $5 million. So like it's a something to treat just put down for protection.
[00:41:16] Eric Fitz: Stephen, this has been so much fun. Really appreciate you coming on the podcast. So excited to continue to follow your journey. We'll continue to stay in touch. But thank you again for coming on the podcast for sure.
[00:41:28] Stephen Hong: I'm sure we'll meet you guys in person one day and we'll yeah, we grab a slice, grab a beer for sure. All right. Thank you so much for your time.
[00:41:38] Eric Fitz: Thanks for listening to the Heat pump podcast. It is a production of Amply Energy, and just a reminder that the opinions voiced were those of our guests or us, depending on who was talking. If you like what you've heard and haven't subscribed, please subscribe on your favorite podcast platform. We'd love to hear from you, so feel free to reach out! You can reach us once again at hello@amply.energy thanks a lot.