Among the consolidators that have been spreading across markets and states through acquisition, there’s been a more stealthy operator.
Gold Medal Pools, a Dallas-based construction and service firm, began purchasing companies two years ago with the backing of private equity. While the focus has been residential service, some of the acquired companies offer new-pool construction as well.
Recently Gold Medal reached a new watershed — taking on a second private-equity investor, making its 21st acquisition, and expanding its focus not only outside the Dallas area, but into other Sunbelt states.
“[We’re] in pretty serious talks with folks in a handful of states right now,” says the company’s CEO, Josh Sandler.
It plans to approach each new market by first purchasing an established, well-regarded company to serve as a regional hub, then building upon that.
So far, the company has mostly purchased operations servicing 300 to 1,000 pools per week. In its negotiations, it works with the sellers to determine whether they will continue to play a role or if they want to step away.
To standardize practices, Gold Medal has developed a learning management system and a training time line to gradually transition acquirees into the company’s way of doing things.
Here, we learn more about Gold Medal Pools and its CEO.
PSN: Where were you born and raised?
Sandler: Dallas. Been here my whole life.
PSN: How did you get in the pool/spa industry?
Sandler: I have been in the industry my whole life.
My family started in the early ’70s in the pool construction space. My father, Steve Sandler, built a company up in the North Texas market and sold it in the early ’90s.
I spent a lot of time in the business. I started on the construction side more than 30 years ago, while I was in my mid-to-late teens. I started doing hard labor ... No free passes here.
I then graduated from University of Texas with degrees in corporate communications and business. At that point, I really saw the business in a different light.
I’ve always had jobs on my own as well. When I was in business school, I worked for a tech incubator. I spent a lot of time as a machine operator — operating machines and waiting tables got me through college.
My Dad founded Gold Medal Pools in 1997. When we started, it was three employees. It really had a residential-construction focus, because that’s what we knew at the time. Although I still worked a lot of hard labor and construction for many years, I spent a lot of time growing the business and building a sustainable platform.
I bought into the company over time. My father and I were partners for many years. When he retired in 2019, we were able to use private equity as a legacy-planning tool for our family, as well as a growth tool.
PSN: What made you stay in the pool/spa industry?
Sandler: It’s a wonderful business, a wonderful industry. There aren’t so many places where you start with happy people and all you need to do is keep them happy. It’s been wonderful dealing with clients and seeing their dreams come true in their backyard, and to be able to build lifetime relationships with them.
From the business side, I’ve really enjoyed being able to build something of scale that builds value and wealth for families and employees, and for everyone who’s involved.
PSN: How did Gold Medal Pools evolve?
Sandler: About 15 years ago, I started a commercial division. We started with small-scale commercial pools, then progressed to building very large-scale projects. About 10 years ago, we started really focusing on service and maintenance. We continued to grow all three lines — residential construction, commercial construction, then service and maintenance.
In about 2015 we started doing some real legacy planning for the business, figuring out how certain people could retire, and how we could achieve maximum liquidity from the business, as opposed to what you just make on a daily basis.
In 2019, we did a minority recapitalization with a private equity firm. From there we really started to focus on professionalizing the business, building processes, procedures, and good measurements that really allowed us to scale the business, keep a good eye on it and make the best decisions possible.
When the large freeze hit here in 2021, that really opened our eyes to a lot of opportunity in the service and maintenance side. So we went down the road of acquiring service and maintenance companies. Over the next 18 months or so, we bought 16 companies. Then we paused to take all our lessons learned, and really evaluate the business and each line of the business on its own merits.
We brought in operational consultants, and really got down to the nuts and bolts of the business to measure each piece, from the service technician we just hired to the CEO. That allowed us to feel very comfortable about continuing to scale.
We started overlaying and piecing everything together, and we found the most valuable for us was residential construction paired with our service and maintenance division. So we found a buyer for the commercial line of business.
We really believe in the power of focus and finding a handful of things that you can perfect, and we found ourselves burning the most calories for the least amount of long-term enterprise value on the commercial side.
We went through another recapitalization. Our original partners stayed in, and we recapitalized with another partner.
PSN: What has been one of the most important lessons you’ve learned as you’ve grown your company?
Sandler: As a young man in business, you want to do everything for everybody. As I gained experience and built processes and leadership with a wonderful team around me, I really focused on burning calories in the spots that bring the most value.
We see a significant difference between value and profit. Ours is a very profitable company, but we think we’ve also created the right business mix to generate the maximum amount of long-term value, which is what I think creates sustainability in the business, as well as opportunities for our sellers, employees and stockholders.
It’s a bit of a space race right now [among consolidators], but we think the way we’re going about it is going to generate the most value as opposed to a project-based business.
PSN: What have you learned about consolidation in this industry?
Sandler: We’ve learned a lot about the tolerance of people in general for change. I think if it’s communicated well and even overcommunicated, I think people are amazing. It’s our job to be diligent and to communicate and overcommunicate to make sure people are informed.
Change is necessary for growth, but Rule No. 1 is “Do no harm” — to employees or clients. Just because we have a track record now and have been successful at [acquisitions], it does not mean we can come in on Day 1 and make significant changes. The result of that is turnover and attrition, which is not what we want. We’ve learned a lot about patience and tolerance. There’s way more to a business than the numbers on a profit and loss statement.
PSN: What’s your favorite thing about your job?
Sandler: Dealing with people, no question. Getting to learn about different people’s walks of life and hearing how they got to where they are. I love hearing people’s stories.
PSN: What’s your favorite motto or saying?
Sandler: Every time somebody asks me how I’m doing, I say, “I’m better than I deserve.” I feel grateful and thankful to be in a position to have the opportunity to be part of such a great industry and great business.
PSN: What’s the most important thing you do to maintain focus and energy?
Sandler: Exercise, exercise, exercise. It’s just phenomenal for maintaining health, and I think it’s a big piece for mental health.
The most important thing is a healthy and balanced lifestyle and surrounding yourself with great people. It takes a village of like-minded people to build something great, and knowing you have that kind of support, companionship and trust, to keep your good people is just really the good to great moment.
PSN: What’s your favorite business book?
Sandler: We spend quite a bit of time going through books in our leadership meetings. The latest one that comes to mind is “Extreme Ownership” by Jocko Willink and Leif Babin. It shows that every piece of the process is important from the top to the bottom. As long as everybody has focus and extreme ownership of their piece of the puzzle, then success is imminent.
PSN: Who would you consider your personal role model? What’s the most important thing they taught you?
Sandler: Obviously my Dad was a huge role model. He taught me to work hard and do the right thing by people.