Ryan Sitton On Bootstrapping A $75 Million Revenue Company To Bring Data-Driven Reliability Solutions To Industrial Plants

In the dynamic world of entrepreneurship, few stories are as compelling as that of Ryan Sitton, the visionary founder of Pinnacle. This company has become a game-changer in the reliability systems industry.

In this exclusive interview, Ryan Sitton shares his remarkable journey, from the early days of bootstrapping to the revolutionary strides Pinnacle has taken in transforming industrial reliability. Instead of bringing in external investors, Ryan believes in his employees owning the company.

In this episode, you will learn:

• Pinnacle Reliability, with 500 employees globally, is making waves in industrial sectors, driving innovation in plant operations, and fostering a culture of positive impact.
• The introduction of Newton, an advanced reliability modeling system, showcases Pinnacle’s commitment to cutting-edge technology, blending services, technology, and engineering expertise seamlessly.
• Pinnacle’s revenue projection of around $75 million this year reflects its consistent growth trajectory, underlining its resilience and forward-focused business strategies.
• The unique ownership model, with 75% of the company owned by employees, sets Pinnacle apart, fostering a culture of stewardship and ensuring a legacy that extends beyond the founder’s family.
• Pinnacle’s visionary founder plans to sell stock to employees at affordable rates, emphasizing the importance of instilling a sense of ownership and responsibility among the workforce.
• The company’s core philosophy centers on making a dollar by making customers $2, aligning business goals with creating tangible value in industrial reliability.
• Pinnacle’s advice to the next generation emphasizes building a company around a strong value set and the importance of swift action in managing employees who do not align with the company’s overarching vision, showcasing a commitment to maintaining a cohesive and aligned workforce.

SUBSCRIBE ON:

For a winning deck, see the commentary on a pitch deck from an Uber competitor that has raised over $400M (see it here). 

Remember to unlock for free the pitch deck template that is being used by founders around the world to raise millions below.

About Ryan Sitton:

Ryan Sitton is one of the world’s leading experts in energy markets, production, and regulation. He is one of the foremost authorities on integrity programs and risk analysis, having been frequently called to provide expertise to some of the world’s most complex companies.

In addition, Ryan has provided expertise in both regulatory and civil court cases, and he has advised several public groups, including the Occupational Safety and Health Administration (OSHA), the Mary Kay O’Connor Process Safety Center, and the National Aeronautics and Space Administration (NASA).

In 2014, Ryan was elected to the Texas Railroad Commission, the State regulatory agency that oversees oil and gas regulation. He is the first engineer in 50 years to serve in this post.

Ryan is also the founder of Pinnacle Advanced Reliability Technologies, an engineering and technology company focused on reliability and integrity programs for process equipment.

In addition to his political and technical areas of focus, Ryan is a passionate entrepreneur. In the past five years, he has spearheaded new businesses in everything from real estate to restaurants.

Today, he is pursuing a new startup… a new generation of tricycles that adults and kids can both enjoy.

Connect with Ryan Sitton:

• RocketReach
• LinkedIn
• Crunchbase
• Bloomberg

Read the Full Transcription of the Interview:

Alejandro Cremades: Alrighty hello everyone and welcome to the dealmakerr show. So today today we have a really exciting founder joining us I mean he’s being billing his company for quite some time and you know is is quite the rocket ship but is a very unique rocket ship because he’s been able to bootstrap the whole thing from nothing.

Ryan Sitton: Lets do.

Alejandro Cremades: Without any you know outside you know capital you know, really supporting on the journey. So on today’s show we’re going to be learning. You know what he failed from what what he learned from his failures how he has gone about building culture and hiring and firing.

Ryan Sitton: What with it.

Alejandro Cremades: As well as how he plans to give away most of this talk to his own employees which I think is remarkable and 1 of the first times that we hear you know an approach like this one so without farther ado let’s welcome our guest today Ryan Sitton welcome to the show.

Ryan Sitton: Thank Alejandro it’s great to be here I well ah, my parents are both teachers so we grew up fairly what I know today to be modest. Although at the time I didn’t know that right I was just a kid growing up.

Alejandro Cremades: So originally born in irving Texas so give us a walkthrough memory lane. How was life growing up.

Ryan Sitton: Roof over my head 3 squares a day but um, but what was cool was when your your parents. Not only were my parents both teachers they’re both science teachers. So my dad mom brilliant people and they also were not just teachers for their profession but they were teachers at heart and so always growing up. You know, teaching things. And my dad did everything around the house mom did everything around the house so teaching us everything from how to cook to how to fix the water heater how to change the oil in the cars and so I I would say that my biggest advantage growing up or the biggest privilege I had was to live a life where you just learning was just part of life all the time and and that. And the other thing I would add is that mom and dad both prioritized or really valued in intellect. They valued intelligence so learning to figure things out and so yeah, that was that was what is like growing up in irving and for the day I was born. All I could remember mom and dad were talking about you were going to go to college and. Science and math. These are the languages of smart people and engineer was a natural degree for that. What was interesting was my parents were both the first ever in their families to go to college. But for me, it was just a given so definitely blessed to be raised in that type of environment.

Alejandro Cremades: So obviously engineering you know is what you had to study and you went at it and you did study engineering now in your case you know, tell us about you know, the first you know couple of jobs that you had you know that led to.

Ryan Sitton: Um, right.

Alejandro Cremades: The latest one in which you actually got fired So so walk us through how that the you know corporate you know career, you know, shaping up.

Ryan Sitton: Yeah, well, um, my first job out of college was with oxy the big oil and gas company I actually worked at a chemical plant or chemical division. But that was my first job second job was with Marathon which is also a big big industrial company oil and gas producer I worked at the refining. Company at the time so worked in big industrial facilities learned a lot during that kind of 3 year journey and then in 2001 I went to a small company called burwanger which is a small consulting company and um, man talking about other blessing and about learning the cool thing by going to work at burwanger was. I worked around another founder. The guy’s name was Pat Berwinger and I got to to sort of rise up in that company one that big is 100 people or so when I went to work him but I got to watch a founder operate and he was a really unique guy eccentric guy but ah but man talk about getting a really special opportunity to learn both the goods and bads of of. Founding a company. Well that company burwweer I worked there for four and a half years and by the time I had but by middle of 2005 I’d actually started a new division of that company. So the the founder there supported me in starting a little division hired a couple of employees and getting a chance to start a business if you will. Under his guidance and then in the middle of 2005 burlinger sold the siemens the big multinational company and Pat have decided he was gonna sell and leave. He was not Instagram and his number 2 guy was gonna take over and that guy and I did not get along.

Ryan Sitton: And so when when it became clear that you know the the lines were being drawn. My line was being drawn out and so right before the sale went through November of 2005 I was shown the door and man talk about a hard experience. Like my wife would tell you that was the closest she’d ever seen me to depressed like I’d never been fired before they’d obviously loved me. They’d let me start the visions there and all sudden to be told that thank you? No thank you, you can go that was rough. Um, yeah.

Alejandro Cremades: Well how how how was that for you I mean what were what were the um because obviously you know like first you go through the period of sadness and disappointment then is reflection then he’s just picking yourself back up and and you keep it moving. So so how was that transition of of events for you too. Emotions.

Ryan Sitton: Never Ben yeah tell ajandro that the I remember the day I remember showing up at a meeting and them telling me. We’re gonna we’re gonna for intents and purposes. They wouldn’t the allow me but we’re gonna sort of suspend you it was becoming obvious they were just trying to pick the right words to let me go. And I get fired go home and I think it’s a Thursday and a good friend of mine who I’d hired to come work for me. There had to so come by my house and get my laptop from me because I didn’t have it at the office that day and man I mean it was just devastating. Um my wife would remind me.

Ryan Sitton: Remembers me like laying on the couch for three days just like just watching tv not even able to to process what was happening I remember a few days went by and I was trying to figure out how I was going to handle this and could I get my job back and just you know all over the place and I rememberized about a weekend and I was. Really struggling and I got a call from a friend of mine Randy Merrywin and Randy and I didn’t know each other really well but we knew each other well enough and Randy was the first person to give me the yeah stop stop your petity party and get your shit together and so we’re on the phone and he says something like Ryan you need to quit wallowing. way too talented. Get your resume updated said it to me. Let’s get it out there go out there start looking for new jobs and then I I was in my dining room at the time on the phone with randy and I sort of walked out and like said my wife still to the day remembers this happened. She’s like ryan walked out of that dining room just with a ah like he looked different. And that conversation with randy that kind of kick in the shorts like the coach telling you get back on the field get back on the horse that was that call and that sort of started things from there but that that two week period was was hard. it was it was low the lot happened the bit. It happened.

Alejandro Cremades: Well that ended up being the best thing that has ever happened to you because obviously that was the seway that you needed to really you know, know that it was okay to venture into the unknown. So what? what happened next.

Ryan Sitton: Is.

Ryan Sitton: Yeah, so that was like said that was in the few thousand and five I ended up taking a a consulting jobs. It was ah it was a not a full time I was a ten ninety nine consultant working for a small even a smaller engineering firm who was doing this type of work and knew of me and that was that was another to your point Alejandro it was a. It was interesting to go through that low point and to feel the confidence that I could survive that. Okay, once it work at this small consulting company worked there until middle of 2006 and once again at at this point I wasn’t not that wasn’t committed to that company but I didn’t know how that was going to go and it was clear I was not aligned with their objectives. And um, did that work and got paid will to do it actually was getting paid on an hourly basis like twice. What I was making it at burway are doing that consulted I had no benefits and by the way I should say this when I got fired from burlinger. My wife was a stay at home mom. We had 1 kid and she was pregnant with our second. So talking about double income. No kids we were double kids no income and ah and I mean it was an interesting conversation at the house like hey you know making some money now and this is this is zero six I’m working for this consulting company I think hey middle of the year may of 2006 I’m gonna start my own company and my wife and I talk about this and me and and she’s saying well. How’s that gonna work look where are we gonna get money from now. Luckily we’ve lived fairly frugally so we had some saved up and I’m not didn’t even have to draw on retirement but this is gonna sound like Minutia. It was so clear we had a minivan fund we had saved up money to buy a new minivan and I told her hey.

Ryan Sitton: Use that to live off of and if we go down this road I can’t get enough business thing doesn’t work. We’ll bleed down that. But if it gets to 0 I’ll go out and get a job like that’s the most we have to lose in this is the minivayter fund and and sure enough to your point Ale Hundredndra it was a blessing that started may of 0 ero six put $10000 into a bank account didn’t take a paycheck for six months but things started growing and hired our first employee end of that year ah end of ah 6 and then by end of ah 7 I think we’d hired like 10 employees had gotten a couple new contracts a man it just it just took off from there.

Alejandro Cremades: Well obviously I got to ask you did you ever buy that be minivan. Ah.

Ryan Sitton: Um, we did as a matter of fact, um, it was it was about a year later so this is a good story because you think man the minivan fund didn’twindle all the way down, but it dwindled probably so if it startedt like there was like 40000 in that minivan fund. It probably got down to about 10 and like said we put 10 to start the company. We probably brid. Maybe you know close to 0 and then but man we start making I start paying ourselves beginning of oh beginning of oh 7 started taking a paycheck and I think by the end of zero seven we had been able to even though we were paying. We’re not paying ourselves. Well, in fact, I’ll say this. Run this company now 18 years the first eight years um my income from pinnacle did not match what I could have made work in a job 8 years like so a lot of founders would not be that patient now you look today. We’ve been very blessed financially. We’re doing really really well. But that took. 5 six seven eight years of patience before things got because we kept plowing money back into the company. We’d have a really good profitable year make $3000000 we’d leave that sit in operating accounts to go hire any employees or develop software or develop websites or marketing materials. So it took a long time before the the money showed up if you will.

Alejandro Cremades: So for the people that are listening to get it. What ended up being the business model of pinnacle. How do you guys make money right.

Ryan Sitton: For the people.

Ryan Sitton: So we ah and this is a bit unique people will look at us from the outside and say oh, they’re a professional services. Firm. Yes, but our model is quite different. So our specialty is reliability systems. So for all of your folks who aren’t in technical arenas. You think of your car right? you. Back in the day you bought a car and you’d look at the manufacturer you know, recommend recommendation say oh every three thousand miles change the oil every ten thousand miles change the timing belt every twenty Thousand miles change the fuel filter right? You had all of these instructions now if you think now that was for say a honda Accord and Honda would make. Ah, million of those a year they have really good information on the honda accordd to tell you that this is the best maintenance plan to follow. Well imagine you want a maintenance plan for a chemical plant and this chemical plant say that makes hydrochloric acid has not 1 car but. Not 1 machine but that chemical plant is ah is made up of 20000 machines all of which have to work together in order to bring in the the raw products and put push out hydrochloric acid. Not only that there’s only 1 plant just like that in the whole world. So to produce the maintenance plan the reliability plan for that plant is incredibly complicated. And so we started twenty years ago being the cub that would go in and mine the history. So we gather all this original documentation and data and we build these very simple but but build models and help say how often do you need to inspect each of these pieces of machinery how often do you need to do maintenance. Where should you upgrade.

Ryan Sitton: So that we started in a very basic way twenty years ago and over the last twenty years eighteen years we’ve evolved into very advanced models. We’ve built our own software programs that model this stuff we’ve got but but we’ve got our own algorithms that we run but really our bread and butter has always been. We were the guys that would go into the plant and do all of the heavy lifting to set these systems up and get them running. We would get all the data in and and get all of the engineering done so that this system would tell you what to do going forward. So.

Alejandro Cremades: So ah, what point I mean going back to the early days at what point did you realize hey I think that we’re into something here I think we’re gonna be okay.

Ryan Sitton: You know this? this actually will surprise you and and I will if if we if I could pull it up I’d pull it up in 2007 I wrote a business plan. So not even a year in business wrote a business plan and it was ah it was pretty pretty thorough for a guy that was just a year in and was 31 years old the time. And if you looked at that business plan today. Alejandro, you’d be surprised for how close it is to where we are now. It’s clearly still a lot different in a lot of ways. But I knew the market for this was just gargantuan that the big operators out in the world. You know the big oil and gas companies. The big chemical companies. The big mining companies. While they were good at running their facilities. They were not good at reliability strategies and so there was a massive literally. Ah um, a multi $100000000 business if we could figure out how to to package this up and take these solutions to customers.

Alejandro Cremades: So then.

Ryan Sitton: Very I would say I realized that there was a big market. We just had to figure out how to how to deliver the solution to customers in ways that they could understand you running? Um, you know the very turning right? It’s which drug I need to make a.

Alejandro Cremades: So Obviously you know here you are running a perfectable operation and dame you know since the very early beginning because I mean you guys bootstrap the whole thing I mean typically when you’re. Building something you know, meaningful like this something that has legs I mean something profitable people typically would push you in the in the direction of getting outside capital and getting investors to to jump in So How were you able to avoid that destruction and just you know saying hey you know what we’re just gonna be Okay, we’re just gonna be.

Ryan Sitton: Billy finished jump forward I has lift.

Ryan Sitton: To you.

Alejandro Cremades: Building this ourselves without any external money or external people.

Ryan Sitton: Um, yeah, 2 thing maybe 3 and I’ll tell myself here a bit um because you’re right probably two or three years in I started getting real interest from lots of different companies private equity companies. Ah, strategic buyers a lot of big industrial companies and say o man if I could get some of that pinnacle stuff we would have got got interest from big professional consulting comes that wanted to go into this space I mean I’m not I’m not exaggerating when I would say I’ve probably gotten not casual increase I’ve gotten thousands of casual increase I’ve probably gotten.

Ryan Sitton: 3 or 400 serious inquiries people that knew who we were I’ve had people track me down at conferences I had a guy attend a conference in Houston from another state because you knew I was going to be a speaker who wanted to follow me afterward see if his firm could invest in us or bias. So yeah and lots of this and so you said well Ryan why wouldn’t why would you turn that down because there was it was clear. It. So. Several moments that like man if I were to sell the company. You know there’d be hundreds of millions of dollars in my pocket if I would do it and you might say and my friends would tell me Alejama is Iran you’re an idiot. Do. It co go sell the thing get the money and so why didn’t I won. 1 thing that was interesting was money was never really our big because as I said I lived fairly my parents were both teachers I did not have expensive tastes. So if you said Ryan here’s a gigantic pile of money I didn’t that that was not gonna change my lifestyle much so that was it didn’t have a big appeal to me which is that that’s just lucky. Lucky that I didn’t have that I think a lot of founders man I want private jets and I want a second home and I want my kids to go to iry league schools and you know I love to just say I’m a $100000000 guy. Whatever they there’s that tends to war people’s thoughts on the value of dollars I have very reason didn’t have it to um I knew that. Ah. That our limitation wasn’t money like when it looked out there. We would leave money advice said man we got $3000000 in the account. Well if I had a lot more money that wasn’t really going to change our strategy. Our strategy was how did we go connect with customers more and just having more money wasn’t going to solve that problem and the third one and this is where I tell myself was probably just bold faced arrogance.

Ryan Sitton: Just thought I’m worth way more than that. So ah, you know whether or not I was you know most founders do think they are. We’ve all got a little bit of that chip on our shoulder but it turned out to be a blessing for me, but that was probably a big reason So that’s why even those things came in a lot. They just never seemed interesting.

Alejandro Cremades: So for you, you’re building this thing you know and they don’t know about suddenly in 2014 you take a pause you know why.

Ryan Sitton: Um, you know the the answer that is is gonna be less concrete than I I wish it was but I will say this I really was not exposed to politics much growing up. My parents weren’t involved. Didn’t know much about it and when we moved our business to Pasadena which isn’t a big milestone on comm’s history, but it’s ah it’s one that matters for a lot of reasons in in 2009 we moved from paraland after 3 years to Pasadena which is just 2 suburbs of Houston and we moved to Pasadena I got. And got connected into the political. The local political process I met the mayor through that move and the mayor introduced me to the local state representative and that sort of got me involved in politics a little bit and as I started following politics now keep in mind this is 2009 2010 and at the risk of alienating some of your listeners I’m I’m a republican. Um, and I remember that at that time Barack Obama had just got elected president and while I hadn’t paid a whole lot of attention. There was something that struck me I was as you said bootstrapping the company I was making money. Let’s say we’ve made some years a million dollars in profit but of course the government takes 400000 of that. Take my 600000 left over and I don’t take any of it I put it right back in our operating accounts. So I can run the company next year and and use it to create jobs. Well I remember that one of president Obama’s opening speeches. He was talking about the fact that we needed the rich to pay their fair share. We needed to increase taxes on the rich.

Ryan Sitton: So the government could create jobs and man that just infuriated me because I’m like man every dollar you take out of my pocket in taxes is a job I can’t create and you guys are terrible at creating jobs and that was probably when I really started to get interested in politics I was aware of well government could do some things really? Well this was not it. And so fast forward to the 3 or 4 I started getting more involved in politics or looking at what representatives were voting on I looked at state national and then in 2013 2014 um I was involved in a group and the railroad commission job which is the oil and gas regulator for the state of Texas came open. And I had I have shown some interest already in a group that I was involved and said Ryan you should run for this but I say a group a couple people from that group I was at dinner and that sort of happening and sure enough man I threw my hat and ring campaigned hard and got elected.

Alejandro Cremades: So I think that they obviously people skills is a big one. You know when you go into politics. So what would you say that you learned from that experience because I mean you were there for 6 years so what did you really get from that experience especially from dealing with people that you know you would take away with you.

Ryan Sitton: See It’s really.

Alejandro Cremades: Ah, say as ah as a real lesson learned there.

Ryan Sitton: Yeah man, that’s that’s a whole podcast Alejandra in and of itself because when you’ve served I mean I know you when you when you’re when you were a statewide elected official which I was I interacted with everybody. The governor lieutenant governor our Us senators I interacted with congressmen I interacted with state reps state senators interact with local politicians of both parties. Um a couple things I took away the world of politics moves insanely slowly. It’s incredibly hard to get things done because. Competing agendas are so rampant that they sort of define the landscape in other words, if you go in and say man I want to get this thing done because I believe it will serve the population this way. Even if other some somebody else may say yeah, that’s a great thing to get done but I don’t want you to get the credit for that because that means if I tried to run against you in the future then. You could be like there’s just you wouldn’t believe the bizarre integration of these competing agendas so compared to ah a founder for example, an entrepreneur where you and if you build a team around. You can set a clear object man. It can be very frustrating and so you learn a lot of patience and understanding and. How to approach these things knowing that sometimes the best you can do is advocate in other words, you can’t actually make something happen whereas in your business you can, but it is elected official the best you can do is advocate. You can speak publicly about something that would be a good idea why it would matter to the general population. But that.

Ryan Sitton: Takes empathy right? You have to learn to understand people that you will never see and meet through what’s happening in their landscape and so I learned a lot about not just people skills. But how to think about the greater good in in a way that I was never challenged to think before and I think that certainly has affected our business.

Alejandro Cremades: And and in this case I mean putting putting the company or or your experience at the company in pause because now you go and explore politics for 6 years how were you able to set people up and and and the company up for success.

Ryan Sitton: For sure and anything I mean what are you putting the company on.

Ryan Sitton: For seeing here. How.

Alejandro Cremades: You know for you to be okay with a you know not being there day to day for 6 years

Ryan Sitton: In you know, not even the you know there I’ll say what I did and I’ll say I’ll I’ll pass on the most profound lesson I learned from that because there’s there’s a there’s an important question that I think most founders probably don’t ever have an instance like this to learn from. So what happened there was yeah I ran the company for yeah, like said 10 years um prior to this I said 8 ight eight 9 years and during that time a lot of guys who had like come in fairly early were with me and so there was a group of so 20 or so people. Who had been at the company with me for years and when I went and and it’s not like I was goingnna disappear completely I would still be there to coach I just couldn’t be in the day-to-day operations of the business and so they were they were stepping in. We even went outside and found 2 external ceos during that actually 3 external ceos. But really it was this core team that ran the business. You know what’s interesting a hundred after I left the company from the time I left in 2014 january says 14 to 2020 when I came back the company grew in size by 50% so you might say well clearly ryan wasn’t all that good at this because they grew without him for sure. But then I say that but then in 2019 we hit our top year I came back in 2020 and it was already on a downhill swing and then from covid hurt us pretty hard 2020 2021 and 2022 were were each of those years. It kind of went down like this then leveled out 2023 and then 2024 we’re back to growing again.

Ryan Sitton: And what? well I want to pass on I think was an important lesson is as a as a founder and as a leader of an organization of 500 people in that size that the things that we do almost never impact today but they can impact 5 years down the road. So not that I was solely responsible for the company’s growth over those five years I wasn’t here but I can look if you ask the people that were here before I was served in public office while I was gone in public office and since I would come back to look back and say what happened in the for you know, 20 1415 16 17 18 and 19 during that six year period the things that we created in the first eight years carried us through for those 6 years so even though we had changes and we had 3 different ceos during that time but the the way we did business our core principles that the mechanics of running a company. But in place now. What’s interesting is during that 6 year period though some of those things started to wane. So as I was coming back and and even upon reflection now if you look at from 2019 to 20202020 on 2022. We paid the price in those years for things that were not. Solidified in the years of growth so during those years of growth people got complacent. They stopped caring intimately about customers because maybe we were growing in leaps and bounds we weren’t out serving the sites as well as we should have been and so man, what? what? I’m saying through all this is sometimes.

Ryan Sitton: The the actions we take and the impacts of those actions sometimes that gap is 5 years and and often founders don’t aren’t patient enough to understand them but a lot of times if really good business leaders. Really good leaders in general, especially large organizations have to be thinking with that long-term vision because I can tell you from our data from our experience. That’s the impacts that we make are the long term ones rarely short term will be.

Alejandro Cremades: So let’s talk about vision then let’s double click on that imagine you were to go to sleep tonight Ryan and you wake up in a world where the vision of pennnacoe is fully realized what does that world look like.

Ryan Sitton: Oh man, yeah, you know you think about what I’ll I’ll call large industrial facilities chemical plants Lumber Mills Mining facilities wastewater treatment plants refineries you if you think about everything we use every day alejandra. Ah, from glasses to computers. They’re all produced in large industrial complexes and reliability is the single biggest lever that most of those facilities can pull to both compete. And to succeed why is that because in in the end. Let’s use refineries. For example, there are 600 refineries in the world. They all buy crude oil and they all sell Gasolinekerosenediesel. Whatever so they’re all doing kind of the same thing but in slightly different ways. Yes, they can invest in making the refinery bigger they can invest in more advanced chemical processes. But the biggest one the the refineries that are the best in the world. They’re the most reliable the reliability is the biggest needle boo power generation facilities right? They all they all have this and I’ll add into that that. Reliability when we don’t have reliability in society today. Our world freaks out and I have I have to use. No example any more any further back than covid do you remember when we started hearing rumors that manpaper products out of China might be constrained as a result of supply chains.

Ryan Sitton: And you saw pictures of people wheeling wheeling carts out of Costco with a 2 year supply of toilet paper think about that that somebody going oh my god there might be a shortage I need 2 years of toilet paper like people’s minds just go berserk. When the reliability of our basic needs is at risk so you asked me about our vision I envision a world in which people everybody around the world and all these villages know if you want to make your plant more reliable pinnacle is is the game. The pinnacle is they are the clear leaders in this space. Have the subject matter expertise they’ve got the technology. They’ve got the personnel. They got the training systems. They are a easy button for reliability. So if you ran a chemical plant and you say dude I’m tired of trying to figure this out. My guys are good at running the plants. We’re not good at reliability strategies I just go partner with Pinnacle. And yes I spend a dollar on pinnacle but I get $ 3 back in cost savings and profitability and if you look down the road take 10 years from now. Our company’s probably doing something like 2 to $3000000000 a year in revenue because we are delivering. 10 to $15000000000 a year of value to our customers. Yeah, we’ve got at this point back to this vision that we’re revolutionizing the way each one of them use their data to make better real time decisions about what maintenance to do and what assets to upgrade. Our people are are.

Ryan Sitton: Are are excited to go into plants every day because they know me when I go into this plant I’m gonna make a difference there I’m gonna make that plant run better and and it’s gonna be a fun interaction to go figure out how to do better things with their data with our systems. Yeah, you’re probably talking about us having true 3000 employees and they’re spread out all around the world in every. Country that we have a good relationship with. So yeah, you yeah now I where they you were a little pi through um, how many people sure.

Alejandro Cremades: I will be a beautiful, ah beautiful day to wake up to ah now now I guess for the for the people that are listening to get it to in terms of scope and size for pinnacle. How many people do you have now in what other you know numbers. Do you feel comfortable sharing.

Ryan Sitton: So we got about 500 people today. We’ll do this year actually this year probably 75000000 in revenue that’s down from our peak as I said quite a bit actually but we’re we’re growing. Ah again, so the last so last year this year and and next year we already have a good sense that so we’re back in this track and I’ll even say this. During the last three years we invested very heavily in a software, a new software application. So one that the world has never seen before it’s an incredibly advanced reliability reliability modeling system that called Newton that the rest that the world has never seen anything like before and that’s just beginning to go to market right now. So we’re. Combination of services and technology and you know true engineering expertise all rolled into this package. But anyway, um, you know. So yeah, that’s kind of our size today and and we have a pretty good sense over the next couple of years if you ask me? what do I think is going to happen over the next? Yeah 2025 26 I’m expecting us to grow by probably. Ah, the low side 20 I’d say between 20 and 40% over that period of time and mostly in just total revenue. But it’ll be a combination of technology and um and and sort of total services and solutions all rolled into 1 thing.

Alejandro Cremades: So 1 thing that is incredible here is also the way that you’ve thought about giving that sense of ownership to employees you know in this case, you know you own 75 you know or so of the company in terms of um percentage. But the rest is is owned by employees and you do.

Ryan Sitton: Would not.

Ryan Sitton: Um, parent is.

Alejandro Cremades: Plan on not leaving anything you know to anyone unless you know, for example, your kids you know decide to work at the company so walk us through that plan and that structure that you’ve put together there because it’s quite unique.

Ryan Sitton: Well thank and I’ll I’ll say why I landed at that’s not like my kids are you know, not going to get anything from us. They just the pinnacle probably represents you know 80 to 90% of my and my family’s net worth and um and what I realize over time is why why would I just leave this to our kids unless. They really want to be here and be a part of this and leave this because there’s ah, there’s an amazing team here and people that are incredibly devoted to each other to serving our customers to doing things that have an impact on the world and so yeah, the plan is hey we’re going to leave this company to them and. I’ll even get in a little bit of mechanics. How I think this is gonna play out is we will end up selling the stock to employees but we’ll sell it at whatever they can afford to pay for it. So my goal is not to maximize. Let’s say I could go out in the open market and buy a share of pinnacle for or or sell a share for $20 for some reason I may sell it to employee for two I don’t I don’t say I don’t care but I don’t. But what’s most important is that the person who’s getting that share that their mindset is yes I own this today I’m really just stewarding it I’m gonna take my role as an owner and shepherd this company for the next Whatever it’s gonna be 20 years and then I’m gonna turn around I’m gonna sell it to somebody else and they’re gonna do this too if we. But my my hope is that we build this legacy that this this culture around really this is about people who love working together. Love going out and doing things out in the room. Yes, while I’m a sherhome make really good money. The dividends are great. We make good money we get to take the vacations and do all the nice things what to do. But.

Ryan Sitton: We aren’t our value here is not selling the company. Our value here is running the company well and doing great things out in the world and then passing this ownership on to the next generation I Know that not in fact, I’ve never heard anybody else talk about doing that with their company I Just think that that’s the way that that. That a company that a group of people have the biggest impact on Society So. That’s why we want to do it that we um.

Alejandro Cremades: So by the way that’s incredible and super profound and very unique now I want to put you into a time machine and I brought I want to bring you back in time I want to bring you back to two thousand around two thousand and sixteen or or perhaps you know around that time where you were now on the couch you were. You know, lying down watching Tv maybe eating ice cream because you were like super disappointed with what had happened you know with a previous a job and let’s say you’re able to show up right there in front of that younger self you know lying down on the couch and you’re able to capture the attention of that younger Ryan and.

Ryan Sitton: Um, okay.

Ryan Sitton: Yeah, yeah.

Alejandro Cremades: You give that younger Ryan one piece of advice before launching a business. What will that be and why given what you know now.

Ryan Sitton: Okay, so this is the 2006 this is the Ryan that that just got fired from a and.

Alejandro Cremades: Oh yeah, no, so so so 2024 Ryan is right sitting in front of 2006 ryan

Ryan Sitton: Yeah I yeah, so at that point I wasn’t even thinking I was say I wasn’t thinking I was thinking about starting my own company but didn’t have the stones yet. So it let so I’m I’m sitting there sitting in for Ryan I say hey Ryan here’s the one piece of advice I would give you. It’s a good question, a hundred. Um I think I would try that it would be something like this Brian.

Ryan Sitton: You’re going to you. You will be surprised how few companies are really built around a a value set in which they’re going to say we will make a dollar. Making our customers $2 there’s lots of ways to do that right? Investors do that? What? But if you’re gonna do that with reliability build your build your company around that which is what do we did? Anyway, it just took me a long time to realize that that was really what it was about so I would give that Ryan that advice and I would add into it and Ryan anybody you hire that. Doesn’t align with that you have to fire fast like now that I wouldn’t experience this pain for a while. But if you yeah, we talked about this in the opening. There’s a little bit but if you look over that eighteen year period my biggest mistake consistently has been allowing people to stick around too long who. We’re smart. Maybe we’re hard workers. Whatever but they really didn’t buy into what we’re doing and they were a cultural drag and I would go back and tell that guy Ryan be be uncompromising. Don’t ask yourself am I sure that they don’t align and and because if you’re not certain they don’t align. Then you won’t further ask if you’re not sure that they do align then you have to move them out. There’s lots of jobs out there. Lots of good people that can get jobs lots of places. There’s a lot of good people that do not belong in your company. You say our job is to go out and do really cool reliability stuff created things to make a difference for that customer in ways that they don’t even understand today.

Ryan Sitton: If you’re if you hire somebody. That’s not align with that get rid of him now just have that that be the advice I’d give him you.

Alejandro Cremades: Amazing I love it so Ryan for the people that are listening that will love to reach out and say hi. What is the best way for them to do so okay.

Ryan Sitton: Ah, may I’ll say okay so a couple ways. Obviously I’m on social media. But I’ll admit I don’t use it very well. So Linkedin you know I’m I’m on there if you if someone really want to reach out just you drop me ah an email Ryan at ryansitton.com and you know that’s. I don’t always respond quickly but but I will eventually and so yeah, someone wanted to reach out connect likes it through social media or that email would be great would be right.

Alejandro Cremades: Amazing, well easy noble hey Ryan thank you so much for being on the dealmakerr show today. It has been an honor to have you with us.

Ryan Sitton: It’s been honored. Be here.

*****

If you like the show, make sure that you hit that subscribe button. If you can leave a review as well, that would be fantastic. And if you got any value either from this episode or from the show itself, share it with a friend. Perhaps they will also appreciate it. Also, remember, if you need any help, whether it is with your fundraising efforts or with selling your business, you can reach me at al*******@pa**************.com“>al*******@pa**************.com

 

Podcast: Play in new window | Download

Subscribe: Apple Podcasts | Google Podcasts | Spotify | Stitcher | TuneIn | RSS | More