E13: How to Use Government Incentives to Grow Your Business | Josh Allen
Feel like you're hustling non-stop but just can't find that next big opportunity?
We’re talking about curiosity as the ultimate growth hack for entrepreneurs—and why the most successful business owners never stop asking questions.
From building strategic partnerships to unlocking new revenue streams, we cover the real, raw struggles of growing a business in today’s economy, including how to spot opportunities most people miss, building skills that pay off long-term, and why energy efficiency is a hidden profit booster you should be tapping into.
📒 Show Notes and Resources 📒
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Kellen Ketchersid
Kellen is a co-founder of Stag Business Coaching, business strategist, and a systems thinker. He leverages his extensive experience in biotech and consulting to empower entrepreneurs to navigate complex challenges with strategic growth solutions.
Albert Gillispie
Albert is a serial entrepreneur, business efficiency expert and co-founder of Stag Business Coaching who has founded several multimillion-dollar companies. With expertise in optimizing operations and innovative systems, he mentors business leaders who want to unlock their business’s full potential.
Josh Allen is a former CPA with a heavy background in accounting, finance, and investments. He has spent the past 20 years running his own investment company while constantly analyzing opportunities.
He is currently involved in the changing energy industry delivering new solutions to commercial industrial non profit companies. He has led real estate investment and development, private financing and lending for clients and buyers that don’t fit in the traditional bank box, and a new title company he started to provide a fresh and incredible title company experience.
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EPISODE 13 TRANSCRIPTION
Introduction
[00:00:00] Josh Allen: Welcome to the All Things Energy podcast. This is Josh Allen, your host. We're here to power up your understanding of the energy industry with some electrifying topics and some stellar guests. So, we're jumping right into it. I'm super excited to have our guest today, Albert Gillespie with Stag Capital.
[00:00:20] Josh Allen: Albert, welcome to the All Things Energy podcast.
[00:00:22] Albert Gillispie: Thanks for having me. I'm excited.
[00:00:24] Josh Allen: Yeah, absolutely. Well, we're going to jump right into it. Albert and I have known each other several years here in Lubbock. It's not a huge community, although it's growing. But he and I both have lots of shared passions in the business community. I think we were both on a leadership group with Cathy Crockett.
[00:00:37] Albert Gillispie: Oh yeah. Leadwell.
[00:00:38] Josh Allen: Yep. Were you in stuff with LCU connected to her?
[00:00:41] Albert Gillispie: I was, I was. That's where I got my undergrad, 2006 to 2010. They couldn't get enough of me.
[00:00:46] Josh Allen: Yeah, right.
[00:00:47] Albert Gillispie: Well, I couldn't get enough of them.
[00:00:49] Josh Allen: There you go.
[00:00:50] Albert Gillispie: I'm on their board of trustees and just soaking up everything I can.
[00:00:54] Josh Allen: Well, Lubbock Christian is growing like a lot of West Texas and Lubbock in general. So, it's great to see that. Speaking of Cathy, I need to have her on this podcast. She would be another great conversation.
[00:01:05] Albert Gillispie: You do.
[00:01:06] Josh Allen: So quick fun fact, Albert did a little trip down to South America—Argentina for a little dove hunt. Give me 60 seconds on that. That’s not something everyone runs out and does on a weekend.
[00:01:17] Albert Gillispie: That was one of those things. I have several friends that have done it and, being in West Texas, I’m like, "It’s dove hunting, what’s the big deal?" You can go out to any cotton field or reservoir and shoot your limit. It does not compare.
[00:01:30] Josh Allen: Yeah.
[00:01:31] Albert Gillispie: I think I shot almost 2,000 birds.
[00:01:33] Josh Allen: 2,000?
[00:01:34] Albert Gillispie: Which sounds like, "What is wrong with you?" You sociopath? But those particular birds—dove, parakeet, and pigeon—they have a different breed of pigeon down there. All three breed three times a year, so they’re overrun with them. Any landowner or rancher, as long as you clean up your trash, they’re like, "Please help, come help."
[00:01:53] Josh Allen: Wow.
[00:01:54] Albert Gillispie: The accommodations down there—one of my buddies, right before COVID, bought a little hunting ranch down there and remodeled it. The accommodations are crazy.
[00:02:02] Josh Allen: Wow.
[00:02:03] Albert Gillispie: There are six people on staff, there’s a chef, and the accommodations are incredible. You’re not roughing it. If you want to bring your spouse, they’ll have a good time, you’ll eat well, and you’ll shoot until your arm falls off.
Career Beginnings and Shifting from Science to Business
[00:02:51] Josh Allen: Dude, that's incredible. We could talk a long time about international stuff. No matter what you do, when you leave this country and go somewhere else, have a great experience, and meet people, it's really rewarding and rich.
[00:03:04] Josh Allen: But it always reminds me—love seeing the world and being reminded that as imperfect as this country, this place, and this state is, it's really a great place to be too.
[00:03:16] Albert Gillispie: Yep. The part of Argentina we were at, Cordova, they're proudly like, "We're the Texas of Argentina." But yeah, there's nothing like home—whether it's the food, the people, or the politics.
[00:03:32] Josh Allen: Yep. Or the politics, like we're diving into, and the business opportunities here. Speaking of that, how did your career get started? Out of school, got into stuff, and then we'll make our way to Stag Capital today. What were the first seasons of your professional career?
[00:03:51] Albert Gillispie: My undergrad at LCU was biology.
[00:03:53] Josh Allen: Oh, nice.
[00:03:54] Albert Gillispie: I thought I wanted to be a dentist. Went on a ton of international mission trips in my undergrad and came to find out that's not what dentistry is. It's not traveling the world, going on adventures. I didn’t get into dental school, so I worked for a medical device company to build my resume to try to get into dental school.
[00:04:20] Albert Gillispie: I'm a curious person and want to continue progressing in whatever I'm doing. I asked multiple times for different roles, trying different things within that medical device company, and found that I had talent, passion, and enjoyment for the business side of things. That's when I moved away from science and pursued business, started reading business books.
[00:04:49] Albert Gillispie: I've read close to 400 business books. I just enjoy it. It’s fun, it's a passion, it's a hobby. From there, me and some buddies were reading one of the original business books Think and Grow Rich by Napoleon Hill from the 1930s.
[00:05:17] Albert Gillispie: It's incredible how valid and relevant it still is and will forever be. If you like reading, you know, King James version, old English, but great book. One of the core concepts from that is a mastermind. So we formed a mastermind group—a group of like-minded individuals that meet regularly to set goals and hold yourself accountable to what you say you're going to do. It started out as a "get out of debt" club. We're all big Dave Ramsey disciples.
[00:05:45] Albert Gillispie: From there, we all got out of debt, and that group became a small business incubator. So, we started flipping houses and buying duplexes with one of my buddies, Tanner Noble. Through that, I got exposed to different areas of real estate. I went back to school and got my MBA. Tanner was a finance major and a full-time realtor at the time, and we kind of stumbled into apartments.
[00:06:12] Albert Gillispie: We met with a broker, half-joking at the end of the meeting, saying, "Man, we'd like to buy an apartment." Didn’t know how we were going to do that or what that meant. Him being a good salesman, said, "Well, I've got this 16-unit townhome. You guys should take a look at it." So we brought that to our mastermind group, and everyone looked at us like, "What is wrong with you?" Flipping houses, buying duplexes—that works. You can envision that.
[00:06:56] Albert Gillispie: All of them thought it was crazy, except one guy, who was a personal trainer and owned a CrossFit gym, Steven.
[00:07:02] Josh Allen: Right?
[00:07:02] Albert Gillispie: Steven. He was my first CrossFit coach.
[00:07:03] Josh Allen: Really?
[00:07:04] Albert Gillispie: Yes, really.
[00:07:06] Albert Gillispie: Absolutely. You had enough of them, so you moved on.
[00:07:09] Josh Allen: I was getting too old for all the CrossFit movements, all the muscle ups and the things that cause your shoulders to pop out of socket and so forth. So I had to graduate onto a less impactful exercise.
[00:07:21] Albert Gillispie: That's a young man's game. But yeah, Steven had some personal training clients that were in oil and gas, and he was like, "Man, they’ve got a private jet, so I think they have money. Maybe they could be investors." We just got our minds together, and really, all of us have such different personalities. We saw the mastermind at work, getting creative, figuring out how to solve problems. We bought that first deal. All of us put our life savings into it.
[00:08:00] Albert Gillispie: Our spouses are incredible and trusted us. We busted our tails. Nights and weekends, we all had full-time jobs, but we grinded. We sold that deal 13 months later, and everybody did really well. Once you’ve done something, once you've done what you say you're going to do, your mind lets you think a little bigger. Slowly but surely, we went bigger—bought a 40-unit, then a 100, then 200, then 300.
[00:08:33] Albert Gillispie: Throughout that time, all three of us kept pursuing better—growing, figuring out how to get more excellent at this. We got super plugged into the apartment association, super plugged into LCU, kept reading, learning, and improving our craft. We've been doing that for a decade now. This is not the industry 18-year-old Albert thought he’d be in, but through trying things and figuring out what I enjoy, what I’m passionate about, I found something that's a good use of the circumstances and talents God has given me.
[00:09:32] Albert Gillispie: I hope to be doing it until I'm in the grave.
Overcoming Doubt and Finding Growth in Business
[00:09:37] Josh Allen: You know, I'm going to pick at a couple of things you said because one of the things I love about this podcast and what we try to do is really drop some professional development and growth tips for any type of audience that's listening. A couple of things I heard that I think are so valuable and important—I'll say for any generation—but specifically speaking to this 20-something generation that feels enormous pressure and stress to figure life out and decide what they’re going to do.
[00:10:13] Josh Allen: I think some of it is a little misleading in the Instagram world, where it's about having it all today and figuring it out by the time you're 22. If you don't, it's like you've ruined your life. What I heard you saying is that you went down a path, academically—biology—and that didn’t line up. The door didn’t open. For a lot of people, that would have been a huge disappointment. Probably for you, too, there was disappointment, but you made a decision. You used the word "curiosity," which I love.
[00:10:54] Josh Allen: That has been an earmark of my life—following curiosity. If I could plant a seed in a lot of people, it would be just that: be curious, ask questions, and inquire. Your curiosity took you down a path you didn’t expect. It opened some doors, and you began feeding your mind with ideas, thoughts, education, and people—through masterminding. In this world of "have it all today," you didn’t get it all in one day. It took months and years of planting, trying, and failing.
[00:11:21] Josh Allen: I think that message is so important, Albert, for 18-year-olds, 22-year-olds, and even 35-year-olds who are feeling frustrated, stuck, and unsure of what they're doing. It’s okay. You don’t have to have it all figured out when you're 24 or 27.
Building Marketable Skill Sets
[00:11:39] Albert Gillispie: I think you hit a pain point that I feel super passionate about. On social media, business ownership and entrepreneurship are glorified and put on a pedestal as if you're going to be this unicorn and build a hundred-million-dollar business. That’s just not realistic at all. The other side of that is that entrepreneurship and business ownership are some of the most stressful and difficult things.
[00:12:12] Josh Allen: Oh, come on. It’s just like wake up and it’s in your lap.
[00:12:16] Albert Gillispie: No, it is. I mean, it’s lonely. You doubt yourself all the time. Even the guys that are light years ahead of us still deal with that. You’re still going to doubt yourself. You’re still going to second-guess your decisions. A lot of that is just growth. You’re trying new things. You’re on that leading edge, following curiosity. And what I would say to the 18 and 22-year-olds is try a lot of stuff.
[00:12:46] Josh Allen: Work.
[00:12:47] Albert Gillispie: Crazy hours. My entire twenties, I had at least two jobs the whole time. My wife and I affectionately, loathingly refer to that as our med school season of life, where you're going to grind, you’re going to work 80 hours a week, and that’s okay.
[00:13:09] Albert Gillispie: That’s okay for a season because you need to build a foundation of knowledge, experience, relationships,
[00:13:17] Josh Allen: Resources, talents, gifts, things you don’t like, things that fire you up. You don’t know that stuff unless you just get in and try, try and fail, pivot, adjust.
[00:13:31] Josh Allen: I have this picture in my brain, and it’s hard because it’s intangible. We live in a world where everything has to be tangible—success, the bank account, promotion, title, car—if it’s not tangible, a lot of people think it’s not real.
[00:13:54] Josh Allen: And I just think there's a season that you're describing where you're stacking and building a bank account of everything. You used the words knowledge—a bank account of experiences, where you're actually good at stuff. You've got giftings that work well, stacking relationships, knowledge, connections—what works, what doesn't.
[00:14:16] Josh Allen: I'll be honest, those are incredibly valuable assets. If I use a business term, it's a bank account you can stand on. You can't really show a lot of people because it's internal, a little intangible, but the translation into the next seasons of life, it positions you to begin to accelerate in the next seasons. I'm a huge believer in that.
[00:14:41] Albert Gillispie: Yeah.
[00:14:43] Josh Allen: And...
[00:14:45] Albert Gillispie: You need to develop real, marketable skill sets. Regardless of what career or industry you're trying, if that doesn't work out, you've still developed marketable skill sets that are valuable to other people because you can serve them better than they can serve themselves.
[00:15:04] Albert Gillispie: Even in a minimum wage job, that serves a purpose—you're growing, you're changing, you're developing into someone who can better serve others. And you're not meant to stay there. We're supposed to continue to learn, progress, and grow to serve people better.
The Reality of Running a Business
[00:15:22] Josh Allen: I'm going to use a description I heard, man, in my early...
[00:15:30] Josh Allen: Early, probably twenties. And it's kind of like, how do I know—this is kind of the question—how do I know if I'm functioning in something that I could have some longevity around, right? When you're trying a lot of stuff, you're going to try things, and some of it feels heavy. All of it feels a little bit hard, uncomfortable. But the phrase that I have found, that has served me so much to recognize when I'm starting to function in something that has some longevity, that could be really productive, is when you're functioning in—I'm going to use the phrase—using your gifts.
[00:16:02] Josh Allen: Really, talents that are really in you. And some of you may not know what those are. Like, you thought it was dentistry, but you didn't know it was in business, in problem-solving, strategizing, networking, relationship building, and capital raising. Those are skills you didn't know you needed, but as you cultivated them, they began to feed you.
[00:16:18] Josh Allen: And so there's this phrase: when you're functioning in some things that are core talents and giftings of who you are, you're going to have maximum production around it. Meaning you're going to really begin to accomplish some stuff, and it won't drain the life out of you.
[00:16:33] Josh Allen: Now, the opposite, and I've been here a lot and you will be here a lot, is you're going to have to do some things. But the telltale sign for you is that if you're exerting a lot of energy, a lot of time, and it's just draining the life out of you, and you're not seeing much productivity from it, that may be a sign that space is not right for you.
[00:16:55] Josh Allen: I was an accounting major. I got my CPA. I worked in the tax industry. So I had academic and professional knowledge in a very necessary, skilled, valuable industry in the world—accounting and finance. But it drained the ever-living life out of me. When I sat down in an office for eight hours a day doing taxes, I was paid well for it. I had opportunities to grow into it, partnership opportunities, but the idea of doing that for longer than the season I did it in was a telltale sign for me: this is not for me.
[00:17:18] Josh Allen: I could have built my career in that whole thing. Oh my gosh, I would have been miserable. And I think those are, again, some tips, some things to begin to pay attention to as you're growing in your experiences and careers of life.
[00:17:47] Albert Gillispie: I would add to that. There are seasons, macroeconomically speaking, that are harder than others, and we're in one right now. We're in one right now.
[00:18:02] Albert Gillispie: Growth. I will always continue to pursue more and more self-awareness because I am flawed. I am a sinner. I am often so blissfully unaware of myself. But pursuing self-awareness, there is discernment in that over time where you can discern, "Is this just a hard season?" Or is this something that I'm not gifted in and isn’t where I need to be?
[00:18:33] Albert Gillispie: And that just takes reps.
[00:18:36] Josh Allen: Yep. Time, discernment. Yeah. We could talk on this for a long time because it's deep in us, but it's like, you can’t fast-forward through seasons. Now, you may try to, but it’ll burn you. It’ll absolutely burn you. So being willing to persevere, which is a word we don’t like to dwell on—I don’t want to persevere. I don’t want to sweat—it’s really valuable.
[00:18:56] Josh Allen: So I'm going to shift and ask this question in the opportunistic world and how you look at it. Tell me a little bit about Stag Capital. Tell me a little bit about what opportunities are exciting you in your world, and maybe as it relates to West Texas, Texas, or just the economy in general.
Stag Capital and Business Opportunities
[00:19:19] Albert Gillispie: Yeah. So we've had quite a few developments, and really, macroeconomically, it’s putting pressure on our industry. What we do requires you to innovate. In the last year, we’ve started a couple of new ventures. Stag Capital is a private investment firm where we invest in commercial real estate, mainly multifamily apartments and industrial real estate, as well as operating businesses.
[00:19:57] Albert Gillispie: Our investor pool is primarily friends and family investors who are typically business owners. These are business owners who have built amazing, successful companies, developing expertise over decades—20, 30, 40 years. Through those relationships, as they grow their companies or through acquisitions, we’ve been able to become strategic partners with them.
[00:20:30] Albert Gillispie: We help pour gasoline on the fire and be strategic capital for them to grow organically. Tanner went and got licensed to be a business broker, and last October, we opened the West Texas office of Transworld Business Advisors. It’s a business brokerage to help business owners buy and sell businesses. Whether they want to grow through acquisition, or if they’re 60 or 70 years old and have built this business for 30, 40 years and are now looking for an exit plan, we can help.
[00:21:00] Albert Gillispie: We have a heart for that because all three of us, our dads are entrepreneurs and business owners. My dad has a plumbing company, and his plan is to work until he’s in the grave. That’s my plan too—God made us to serve. But I have a heart for those plumbers and business owners who might just shut the doors when they’re tired and can’t do it anymore.
[00:21:49] Albert Gillispie: Ten years ago, 60 percent of small and medium-sized businesses were owned by baby boomers. The youngest of them just turned 60 this year. Fast forward 10 years, and now 50 percent of businesses are owned by boomers. Every day, 10,000 baby boomers are retiring in the U.S., and 7 or 8 percent of them are business owners. That’s a lot of businesses either closing their doors or transitioning in some way.
[00:22:15] Albert Gillispie: A lot of West Texas towns and businesses only get exposure to buying or selling a business through private equity out of Chicago or New York. These companies come in like vultures, bringing all the office work to their back office in Chicago, laying off people, restructuring, and impacting a town. What we want to do is build an ecosystem in West Texas and Eastern New Mexico with attorneys specialized in this, lenders who understand the game, and local buyers who care about the communities—so we don’t have transient workers stripping assets and just trying to create a gain.
[00:23:14] Josh Allen: And, you know, caring nothing about the people, the staffing, the employees, or the legacy.
[00:23:18] Albert Gillispie: Yep, exactly.
[00:23:19] Josh Allen: And so we've started that, and there's a lot of momentum and exciting conversations we've had around that. To support that, we started Stag Business Coaching in January this year. Initially, it was to help these business owners make tweaks to make their business sellable and marketable. It was coaching to help them bridge that gap and get the most value out of their company, but also make it so someone else could step in and continue running it.
[00:24:01] Albert Gillispie: The thing about that is, when you create a healthy, stable, marketable business, it's the same as running a successful business. Our business coaching isn’t just for those looking to sell in the next year but also for startups and business owners who feel stuck. It’s coaching that gives them the tools and a curriculum to bridge the gap from being a solopreneur to a business owner who can make an impact doing what they’re gifted to do well.
[00:24:26] Josh Allen: And, you know, I've had this conversation around business coaching and really trying to help position both existing businesses that may have been running themselves for years or those businesses that are looking for how to strategically position themselves. I love this so much, and this probably goes back to my accounting and financial background—how do you make it easy on the transaction and on the people connected to an acquisition? How do you make it easy for them to evaluate the opportunity?
[00:24:59] Josh Allen: The financial risk and reward, and then how do you help a business owner tweak their existing business so that the valuation can increase? How do we make subtle adjustments to financial reporting? How do we make subtle adjustments to how we operate so that we can increase net income or increase revenue or decrease expenses?
[00:25:21] Josh Allen: Because as you know, most valuation methods are going to be driven by what can you prove, report, and document as far as net income and EBITDA multipliers. And so very few, I would argue, and you're in this a lot more than I am, I think very few business owners have been given the tools and coaching to really be able to look at their business from that strategic standpoint and implement some of the, again, subtle changes. For some of them, maybe more than others. Maybe it’s bookkeeping—what a shocker software can do for your handwritten accounting.
[00:25:55] Albert Gillispie: Exactly. And that's the part where you feel for the business owner because they’re excellent at what they do. If they're a tradesman, they’re an amazing plumber, they’re an amazing machinist. They’re really good at that. They've sought out training, they’ve done so many things to build excellence. But the business side of that—you don't learn that in school.
[00:26:27] Albert Gillispie: Right. And so many of the little tweaks you're describing, it’s having good bookkeeping. Maybe it's customer concentration, maybe it's putting contracts in place, maybe it's creating redundancies in certain positions where if one employee were to leave, it doesn’t dramatically impact the business.
[00:26:48] Albert Gillispie: And so it's a lot of things that de-risk your business to a buyer, but it creates a healthier business even if you didn’t want to sell. There are all these little things—how to manage cash, how much cash do I really need to keep, how much do I need to put back for taxes, how can I systematically do that where I don’t even have to think about it. It’s not this freak out, you know, April 15th or October whatever, every year. It’s planned, and there are these little things like that that aren’t easily accessible for business owners.
[00:27:32] Albert Gillispie: So we really try to distill that down and deliver it in a way that's digestible, walking alongside them and helping them implement it. And it’s a blast. We’ve built over the last decade, and now we get to help other business owners. It’s this ecosystem where they win, and everybody wins.
[00:27:43] Josh Allen: And I have to imagine every time you sit down with a new client, there's a new piece of knowledge and information that you guys get from just observing.
[00:27:52] Josh Allen: Oh yeah. That's fascinating. Look what they did here. I mean, we're going to contribute a lot of value to them, but my God, that’s an idea we can implement over there.
[00:28:00] Albert Gillispie: A thousand percent. That scratches the curiosity, that little itch in the back of my brain. At this point, reading books, I’m reading some pretty obscure books. You know, there’s only so much you can read where I'm looking for that one golden nugget. Now with all these business owners, it’s like, okay, what’s that one golden nugget.
[00:28:13] Albert Gillispie: If it's some farm and ranching operation—my in-laws are farmers and ranchers, my side of the family ranches—it’s like, okay, what little tidbits can I learn from this that I can bring to them and help them. There’s so much, and it's never-ending. That’s the piece of the business I didn’t know I would enjoy.
[00:28:35] Albert Gillispie: I'm right on the fence of introvert, extrovert. One-on-one conversations like this energize me. I enjoy it. I want to hear people's stories, what excites them, what scares them, and what they're doing about that.
The Power of Energy Efficiency in Business Operations
[00:28:59] Josh Allen: And so I'll say, and this is to me, a perfect kind of intersection into why we're sitting here today, quite frankly. That is, as a curious entrepreneurial business, financially-minded person, I kind of had this aha moment several years ago when I got introduced to my business partner here at Rise Energy. Energy has a greater and greater impact on businesses. I would argue there may not be a single business that doesn't have some type of, "you got to turn the lights on, AC, whatever it is."
[00:29:26] Josh Allen: My brain got really excited about this. I'm going to pick your brain in this regard. If we, as a business, can find subtle tweaks, modifications, adjustments, assets, and technologies that can shrink the cost and exposure of energy, it’s going to have a bottom-line effect on net income, increased valuation, increased cash flow, and onward we go. It's a sector I think every business has to look at, but they may not pay attention to it.
So, my question to you is, it’s not your expertise, you don't spend every day on it, but having touched lots of real estate, multifamily, and now advising businesses, how often do you see energy-related pain points like costs, exposure, resilience, reliability? How often does that come up as a conversation or a point of emphasis?
[00:30:30] Albert Gillispie: Let me take a step back before I address your question. I'll try not to ramble too much. In reading, there are these titans of industry from the early 1900s who built these empires—whether it’s Carnegie, Rockefeller—they poured gasoline on their empires through things like the building of the railroad. In the early 1900s, there were a lot of government incentives to build out this infrastructure, which benefited the whole country. But they used those incentives as tools for their businesses.
[00:31:17] Albert Gillispie: There have been multiple iterations of that, whether it was the telephone, electrification of the U.S., etc. I think right now, the biggest government incentive program is renewables. I think it’s a tool. I haven't figured out how to use it yet, but it’s a tool to pay attention to. The tax code, like it or not, is written to incentivize the private sector to do work that benefits the public.
[00:32:10] Albert Gillispie: So the government is incentivizing—whether they want us to provide housing, here’s a tax incentive. They want us to provide energy, here’s a tax incentive. It’s a carrot rather than a stick—punishing everybody—it’s a carrot to incentivize people, and I think that’s so much more effective. If you're training a dog and you beat them, how much better trained, better-tempered they’ll be if you're using the carrot, the treat, to encourage a certain behavior.
[00:32:37] Albert Gillispie: So, I say all that to say it’s something to explore. Us being in West Texas, there’s a lot of oil and gas business owners, mom-and-pop oil and gas businesses all over West Texas and Eastern New Mexico. There are different places where renewables or conserving and being as efficient as possible have a place.
[00:33:00] Albert Gillispie: I did a pretty substantial deep dive into solar in particular about two years ago. I read six books, went to a couple of conferences, met with contractors all over the U.S. I haven't figured out a business case that makes full-proof sense for what we are doing yet, but that’s the math equation we have to figure out. We have to keep meeting with people, massaging that model, and figuring out how to make it work because there are so many government incentives. There’s $1.7 trillion out there.
[00:33:53] Albert Gillispie: Figuring that equation out is important. I think it has its proper place. Big picture, there are only so many raw earth materials available right now that we can electrify everything. So, I think oil and gas, natural gas, whatever—it will always have its place.
[00:34:22] Albert Gillispie: And renewables also have their place. We're not where we want to be yet. I think it takes continuous conversation, openness, curiosity, and it has its place.
[00:34:40] Josh Allen: But I don't know exactly what that looks like yet.
[00:34:41] Albert Gillispie: Exactly.
[00:34:41] Josh Allen: Well, and I think this—you know, I'm more knee-deep into the renewable space, clean energy space. I would even say a year ago, year and a half ago, there was a lot more emphasis on our team on really finding where the solar energy asset can be most deployed, maximize the return, efficiency, etc. But I'll say this, in the last year and a half, just on our own team, we'll always have the tools and resources to deploy solar, and it's going to have its place.
[00:35:00] Josh Allen: But there’s been such a dramatic shift in incentivizing and maximizing the battery asset. I've made the argument, and I feel pretty confident in saying, I think the battery technology—the large-scale battery, the medium-scale battery, the utility-scale battery—will probably have the biggest impact for energy-related use, both from the grid standpoint and beyond. I'll give you a quick example right now.
Exploring Battery Technology for Business Growth
[00:35:41] Josh Allen: This is where I’m super interested in trying to help businesses understand this. We can now go to a business and say, "Hey, how about we lower your cost of energy by 15 to 30%?" Right? Now, depending on who you are, energy may be 5 percent of your total budget, 2 percent, maybe 3 percent of your total budget. It just depends. Energy may be a big portion of your budget. So if we can shrink that by 15, 20, 25, 30%, that's a pretty significant bottom line, additive multiplier factor to it.
[00:36:00] Josh Allen: Well, how do you do that? What’s super fascinating now is that we can go to a business and say, "Hey, our team is going to pay for, invest in, own, and install a battery on-site at your facility. We’ll pay you several thousand dollars a year in guaranteed lease payments just for a parking spot. Do you have a parking spot that you’re not using where we can drop a battery system? Maybe two parking spots, depending on the size of the battery system."
[00:36:30] Josh Allen: In exchange for doing that, we’ve got several things we can bring to your business. First, we’re going to pay you several thousand dollars a year for leasing that parking spot so the battery can be there. You have no cost for the battery. We’ll pay for it. By allowing us to have a battery attached to your facility on its own meter, we now have, behind the scenes, an energy trading desk that’s going to use and monetize that battery. When energy prices are high, that battery is going to discharge to the state, and we’re going to get paid for it. When energy prices are low at night, we’re going to recharge that battery. So that battery becomes literally like a cash machine, spitting out energy when prices are high and recharging when prices are low.
[00:37:09] Josh Allen: And because we have that monetized tool that you allow us to put on your site, which we pay you for, the revenue we generate will allow us to give you a lower cost of electricity.
[00:37:35] Albert Gillispie: Okay. I have a million questions. So this battery is onsite at whatever business, and you're recharging it at night from the grid when electricity costs are lower.
[00:37:48] Albert Gillispie: And then shooting it back into the grid when prices are more expensive in the afternoon?
[00:37:51] Josh Allen: Yeah, that's right. And we're going to control that with our energy partners.
[00:38:00] Josh Allen: Quite frankly, from a business opportunity standpoint, the return we make on that battery is great because the government gives us massive tax incentives to install those batteries. But what we can give to the business is really a couple of things. We'll give you a lower cost of energy for 10 years. If you go out to the markets and try to get an energy price right now, they might give you a good deal for two or three years. We’ll give you a 10-year contract. Depending on the length of your business, that may be attractive.
[00:38:25] Josh Allen: Also, this is a little less critical here in West Texas, but if you're down near the Gulf, like in Houston, anytime there's a power failure event, a grid outage, or a weather event, you’ve got a battery. Whatever energy is left in that battery, you have access to it. And when it recharges at night, you have access to it. So in power failure events, you now potentially have some additional backup power that you didn’t have to pay for. We own that, but it’s connected to your site, so you have access to that.
[00:39:00] Josh Allen: If you’re a business and you want to own an energy asset, we can go into partnership with you. You can help pay for and own that asset, generate a return on that investment, and have a lower cost of energy with guaranteed lease payments. So, again, just a shift in the last year or so is looking at a new asset in the renewable space that allows us to bring several attractive solutions to businesses, organizations, churches, and nonprofits. That is a huge change in the last 18 months.
[00:39:31] Albert Gillispie: And so what is a, what is a shelf life? Is that the right term? What's the useful life for a battery?
[00:39:41] Josh Allen: Useful life for a battery, you know, and again, this is where technology has made some dramatic improvements and will continue to improve. That’s basically going to affect the life of these batteries, the output, and the turn times of them. Today, I think most larger, we’ll call them quasi utility scale batteries, are probably going to have around a 20-year life.
[00:40:07] Josh Allen: That’s great. I mean, it’s a pretty good chunk of time. When you look at the ROI on these batteries, it’s significant. You’re going to get your return back pretty quickly from an investor standpoint, and we can leverage the cost of the battery with low-cost solutions. My investor brain, both as an asset you can own, goes bonkers, but really deploying an energy solution to the business, to the organization, to Lubbock Christian. I mean, literally fill in the blank of who you want to help deliver some lower cost of energy and guaranteed income sources.
Ideal Clients and Energy Savings for Businesses
[00:40:42] Albert Gillispie: My brain is spinning right now. So what are the variables for you guys? Like, what is your ideal client, best case? And what is a marginal client that might not be worth it?
[00:40:56] Josh Allen: Well, I mean, certainly the more energy you're using, the more benefit you're going to get, right? So if you're, you know, a thousand-square-foot retail store that's only open from 10 AM to 6 PM, you're probably not using a lot of electricity. Right? So that's probably—you could get some benefit from it, but it's not going to be the most ideal. If you're, um, you know, I’ll pick on Lubbock Christian because you probably see some of the numbers there.
[00:41:16] Albert Gillispie: Bring it.
[00:41:17] Josh Allen: They're using gobs of energy, right? And I think, especially as a nonprofit, you’re very budget-sensitive. Everyone’s budget-sensitive, but especially nonprofits, which are exposed to variations in their budget. Energy can be one of those that has a painful financial impact on cash flow. So, for example, we would go in and look at the total energy picture for a university like Lubbock Christian. We’d analyze their current cost of power.
[00:42:00] Josh Allen: Then we’d want to see how long they're locked into that cost and look at the variables for adjusting it, or for blending and extending it. It’s like taking your current contract with two years left and extending it to eight years, giving you a consistent, budgeted cost of electricity. And compared to where you currently are, we’d budget for inflation at 3%, 4%, 5%, showing what your next contract could look like. But instead of this higher cost, we’d drop it all the way down to a lower cost.
[00:42:38] Josh Allen: Then we’d say, here’s how much we’ll pay you every year in guaranteed lease payments, because we’re leasing a parking spot—or three parking spots or however many we need. You also get access to some backup power. So, we do an analysis of your current cost, usage, and forecast what it may be when you go into the next contract.
[00:42:58] Josh Allen: For many people in Lubbock, when they signed contracts this past February, they signed six-month or 12-month contracts because they didn’t want to lock in too long. They wanted to feel it out. Some people signed longer, but depending on when their contracts are coming due—five or six months from now—we’re already talking to them. We’re saying, "Hey, before you sign something, let us put this option in front of you. It might shock you how valuable it could be.”
[00:43:37] Albert Gillispie: So paraphrasing the benefits you've described, you're looking to decrease their electricity bill by 15 to 30%.
[00:43:49] Josh Allen: Yep.
[00:43:50] Albert Gillispie: And then, on top of that, some kind of lease payment for the space that’s occupying. And then you're putting a contract in place for a locked-in lower rate for 10 years. That's awesome. That is what entrepreneurs bring to all of these problems—how can the private sector tweak this, how can we deliver something as efficient as possible? It creates all these different wins because everyone's incentivized, and the incentives are aligned.
[00:44:32] Albert Gillispie: And that's what an entrepreneur does. I love your creative brain and curiosity—how can we keep tweaking this to align?
Strategic Business Planning with Locked-in Energy Costs
[00:44:41] Josh Allen: Benefit to align. And I'm even just thinking, you know, if you're looking at selling your business in six months, in one year, in three years, I mean, again, if I'm looking at buying your business, I'm going to pay attention to a lot of things. I'm going to go, okay, here's the cost of real estate taxes today, here's what it may be tomorrow. Right? Here's the cost of this today, here's what I've got to forecast it to be tomorrow. And energy—depending on what your business is—may be a small line item in your overhead, or it may be a bigger portion.
[00:45:10] Josh Allen: It would make your business more attractive to me as an acquirer if there was a locked-in fixed cost of energy for three years, five years, 10 years. Now I don't have to guess what that line item is going to be in 2028 or 2030. It's locked in place. So as a business planning tool, as a valuation tool, that alone would make sense. I'd want to have something fixed and locked that I can present to my acquisition partner to go, "Hey, you don't have to worry about this."
[00:45:41] Albert Gillispie: Hey, listen up manufacturing clients, machine shop clients. Listen, this is one of your biggest expenses right here. How can we be a little strategic and put some effort towards one of your biggest expenses? That's great. That's brilliant. And why we need creative, curious minds continuing to pursue things like this.
[00:46:11] Josh Allen: We could probably talk forever, and we've probably run past our time. So I'll kind of wrap this up. No, this is great. This is why we love these talks. I'm honestly going to have you back on, and we’ll just talk about other stuff. But what I love about this conversation today is that you're taking the skillset, the knowledge, the relationships, and experiences you've had in the business development world and really applying that in small business coaching, strategically helping to position them.
[00:46:33] Josh Allen: And that's a niche—a critical niche—especially in our baby boomers retiring generation. You know, we've kind of taken our niche in the energy space, and I’d argue both of those affect every single business out there. At some point, you may sell it today, you need to find improvements in the way you're running your business. Every business, I would argue, has some kind of energy exposure.
[00:47:15] Josh Allen: So I love learning and being connected to people like you that have these niches that really impact business, serve communities, and people. It’s really rewarding. So thank you for joining us today, man.
[00:47:19] Albert Gillispie: Thanks for having me. I appreciate your constant and never-ending pursuit of excellence and serving people more. We need people like that, especially in difficult times like we're in right now. Yeah.
[00:47:35] Albert Gillispie: You got to get scrappy. You got to serve people. I appreciate you.
[00:47:39] Josh Allen: Yep. Well, listen, ladies and gentlemen, Albert Gillespie, Stag Capital. He's definitely going to be back on because we've got far too many things to brainstorm around. So, thank you for joining us on the All Things Energy podcast. As you know, you can check us out on all of our social media handles at @GetRiseEnergy or www.getriseenergy.com. We'd love to serve you, help you find some of those solutions we talked about. Until next time, thanks for listening, and we'll catch you here.
