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How Finance Teams Manage Jobs at Scale with Lien Rights Software

The credit and finance team at any growing construction company is vital to the success of the organization as a whole. As a company takes on more jobs and bigger clients, securing receivables and managing cash flow can become more challenging and time consuming.

However, cloud-based software and automated solutions like Levelset can remove these challenges and help finance teams operate more efficiently without wasting resources.

If you’re interested in what it looks like to use Levelset to manage payment paperwork and cash flow on jobs at scale, join our upcoming webinar to hear Toby Brutsman, the Regional Credit Manager at Morsco share his expertise and insights.

In this webinar you’ll learn:

  • Why a full lien rights management solution is more effective than a notice service or manual processes
  • How credit managers can streamline the notice process using automation
  • Tips to help your finance team successfully secure receivables while taking on bigger jobs


Brandon Davenport (00:05):
Brandon Roach, thanks for joining as well. And, uh, for the context, um, for today’s meeting, um, my name is Brandon Davenport. Uh, I’m joined here, uh, by Toby and Marissa Toby’s, uh, regional credit manager in the Dallas office of more SCO, uh, I, myself am a payment expert over here at Levelset and we have Marissa, uh, on the marketing team, uh, as well, uh, representing Levelset and, uh, for today’s conversation. Uh, we are going to be going over a couple of things. Uh, I’ll do some introductions. I’ll, uh, talk a little bit about my own story. Uh, Toby will talk about his story and then we’re going to get into some discussion. Uh, we’re going to talk about, uh, the relationship that a Moscow has built, uh, formally for line, uh, with Toby’s experience, uh, with Levelset over the years.

Brandon Davenport (02:33):
Uh, I’m going to unpack a little bit about the construction finance, toolbox, how Toby and his team, uh, partner with us in order to create efficiencies, uh, which leads us into the title of today’s webinar, how finance teams are able to, um, manage and scale, uh, credit and be able to make decisions. So when we think about the structure we got today, um, we’ll also leave about five, 10 minutes towards the end to be able to do any Q and a. And I want to highlight that, uh, as we get started for today, I want to highlight that, uh, the questions are heavily encouraged, uh, would love for people to, um, put anything in I’m going to respond to those questions individually via email, uh, after today’s webinar. Uh, and of course, as a little added incentive, um, for all the questions that are submitted throughout the course of today’s webinar, I’m going to pick a number out of a hat, send a nice little coffee gift card of your choice over to you via email as well. Uh, with that being said, uh, I’m going to start to share my screen and, uh, as important that up, um, would love to kick things off with, uh, just a quick intro of myself, Toby I’ll pass the mic to you, and then we can get into our discussion. Give me one second.

Brandon Davenport (04:03):
Toby, can you see my screen? Gotcha. Excellent. Well for today’s speakers, as you’ve already met us. Um, again, my name is Brandon Davenport. Uh, I lead a team of payment experts, uh, over here at Levelset I myself, uh, uh, come from Tennessee, um, moved all over the map, uh, from Rhode Island to new Orleans, uh, move. I was telling Toby, uh, just yesterday that I moved to Austin, uh, over the weekends. So now I’m in Levelsets Austin office, and I’ve been fortunate enough to be with the company for a little over two years. I started off as a payment expert and, uh, now I’m in a position where, uh, like I said, I’m fortunate enough to be able to lead some other payment experts to be able to deliver on our mission mentioned here, uh, Toby, um, pass the Mike over to you and, uh, we can get into some.

Toby Brutsman (04:57):
Thanks, Brendan. Um, thank you everybody for joining us today. Um, my name is Toby I’m one of the regional credit managers for more scope I’ve been with Maurisco for our, I guess, subsidies of Maurisco since 2007. Uh, been a regional credit manager since, uh, 2018. Um, I want to raise, I was born and raised in Northwest Indiana. Um, moved down to the Carolinas for a job in banking and credit, uh, in the late 1990s. So I date myself a little bit, um, and then had the opportunity to, uh, while in Charlotte move into the construction industry. Uh, and I came into it with this, uh, eyes wide open, if you will thinking it was much like the banking, uh, credit. Totally not. So I learned a lot early on. Um, and then, uh, recently in the last, uh, two years, uh, have moved out to Dallas, uh, where I’m at now, um, as part of the, uh, more scope portfolio, I handle the, uh, underground utility side, uh, the central and Gulf regions for the plumbing group. So I appreciate your guys’ time today. Hopefully we can cover some topics and feel free to ask as many questions as you have. We’ll try to answer them for you.

Brandon Davenport (06:13):
Very good. Thanks for sharing Toby. And, uh, when we think about that transition, you go ahead and you’re jokingly saying it that you thought credit was one thing, and as you really got into it, it evolved in, you know, it’s been a cornerstone, uh, of your own career. And with that being said, like, I’d love to learn a little bit more about journaling, some of the challenges that you’ve noticed originally making that transition, uh, as a credit manager then as a regional credit manager, uh, after that, uh, when you moved to Dallas,

Toby Brutsman (06:49):
I think the challenge is right now, um, I mean, I’ll kind of take this from a higher level. I think all of us are kind of feeling a little bit of the pain of, uh, onboarding and, and finding quality talent. That remains one of the biggest hurdles for us right now. And I think it’s kind of across the country, um, you know, finding good people right now. Um, and, and more SKO is, you know, whether it’s credit jobs, support jobs, branch jobs, sales jobs, everybody’s kind of feeling that. So that’s one of the biggest challenges, but that aside, I think that the interesting part about doing what we do from the credit collection side from the construction industry, um, is how different the construction world is to a mortgage world or to a credit card or to an auto financing world. Um, you know, there are so many different, different nuances to the construction world.

Toby Brutsman (07:41):
Um, you know, the lanes in bonds that way to secure your, your AR um, the communication that you have with different people that are involved with the projects, whether it’s project managers, uh, whether it’s your customer, the supplier, whether it’s general contractors, whether it’s owners and the project, you’ve got to be very, you know, quick to move in different conversations at different levels, with different, you know, um, companies that are involved with that. Um, you’ve gotta be able to, uh, be, have a little bit of foresight to see, Hey, or somebody else at another supplier having a problem on the job. Uh, and you might not. Um, but you know, you’ve gotta be, uh, forever, um, twisting and turning, making sure that you’re staying on point so that you don’t get caught up, but whatever is going on, um, you know, you’ve got your sales team who’s out there trying to, to make sure we sell the product, the product that we have, making sure that the information that we get at the beginning of the job is correct.

Toby Brutsman (08:35):
So we can take a lot of the risk out of those portfolios or those issues that may come through, um, knowing that we can secure on the back end. So, you know, um, there’s an ever evolving portion of the credit manager role that is a constant flow of education. Uh, you know, you learn so much about different municipalities and how they work different customers and how they work. You know, the size of customers, um, credit for us is a nonstop evolution, uh, learning about our customers, learning about the finance side, learning about, you know, the projects themselves, um, and being able to, to be the pivot person between sales customers, general contractors, CFOs. There’s a lot of high-level conversations that we as credit team members have to have. And I think that’s a beautiful part about the job because, you know, it’s never boring. I mean, it’s always evolving in any way, shape or form.

Toby Brutsman (09:30):
You never know what’s going to come across your desk, my team. And I joke a lot about the fact that a lot of the phone calls we get have nothing to do with credit, but no one else knows where to go with those. So we ended up, you know, trying to get sometimes be the, the solution providers to too many other different parts of the company. Um, and, and in the end, you know, our jobs are to make sure that we are finding answers. So we are probably the most, uh, educated and available, uh, team members for a company. Uh, we, we, we commonly joke about that.

Brandon Davenport (10:00):
Yeah. And OB you, you unpack a lot there. And I feel like there’s a couple of ways for us to categorize that, uh, internally and externally, some of the challenges that you talk about, uh, as a credit manager internally, right? The hiring challenge that you talked about, uh, you know, being able to make sure that you’re creating a harmonious relationship with sales at all times where like externally, you start to talk a little bit about, uh, understanding the nuances of liens, uh, being able to, uh, execute on a bond claim, uh, being able to make the correct credit decision, that’s going to be beneficial to your own organization, as well as to the long-term relationship of the people that you’re working with. And we find that in a lot of the conversations that we have with construction companies across the entire country, is it a couple of different schools of thoughts when it comes to lien rights and, and bond claims, uh, I’d love to learn like your perspective on how lien rights help with, with managing cashflow and how you make decisions on whether to execute on lien rights, the bond claims, or maybe not,

Toby Brutsman (11:12):
You know, I wish there was, uh, an end all be all, but that’s the, the, for me, one of the most, um, interesting parts about the construction credit world is that there there’s no 100% accuracy, right? It’s a lot of experience. It’s a lot of gut instinct. Um, and we as credit team members are decision makers. Um, a lot of times the decisions that we make, um, you know, will impact, uh, a vendor or a customer of ours, uh, negatively if we choose to put them on credit hold. So the decisions that we make are, are, are not in a vacuum. You’ve got to be able to make those decisions, um, with as much information as you can, um, be able to make those decisions with limited emotion. Uh, you’ve gotta be able to make them, you know, our, our sales team has a great relationship I’m specifically, and I’ll speak in, in the Morris go Y uh, side.

Toby Brutsman (12:07):
But, you know, most of the time the sales field is, is the ones that are the face of the companies. And so they understand where they see the customer differently. Credit gets a chance to really give an unbiased approach, uh, to the customers. We see them from a financial perspective, how they look on a piece of paper. And so we take that information and use it, uh, to, to make a best educated decision that we can, um, because the AR is the most, well, it’s the largest, you know, um, asset for a company. And so we are charged with securing that asset and to limit as much risk as we can. Um, you know, you ask how to lien rights, help us kind of what that cashflow lean right lean to and bonds are, are cheap insurance, really, to help make sure that that AR stays equitable, to stays fresh and, and doesn’t move into, you know, uh, aging that, that, you know, is not collectible, or is collectible to severe.

Toby Brutsman (13:03):
So really reduce rate. Um, the AR for the company is what they use a lot of times to, to, to leverage their financial positions, better of earning power. So as a credit team, that’s a big risk. Uh, anytime you’re talking about money, uh, which is the lifeblood of companies and everybody else, you know, it, it’s a, it’s a big responsibility. So we treat lean and bond rights, um, for us, uh, as a requirement, right? I mean, that, that we’re in a risky position. Um, and we’re the ones taking all the risk on the material. And if a customer doesn’t pay the bills that we have to make sure that we, as a business partner for them are able to go out there and at least get our portions paid. Um, and that comes with requirements and responsibilities may be able to, to maintain, uh, the portfolio, know where our materials going whenever we have it, make sure the information that we get from the field is legitimate, uh, can be vetted and accurate, uh, so that our lien and bond rights are not in question.

Toby Brutsman (13:57):
If we have to go that route, um, the lanes in bonds, they also help us from a perspective of being able to communicate better up the chain with general contractors and landowners or homeowners, uh, to let them know, Hey, look, guys, you know, before you close your books, make sure we’ve been paid as a supplier. Otherwise, you know, we will have to take action. And I think general contractors and owner homeowners owners, for the most part, I think they appreciate that they, they don’t, I don’t know many people that like surprises like that, Hey, by the way, you better leave thought on your house. We try to make sure that we communicate upfront well in advance before we have to do that. Uh, you know, the waiver process is that everybody’s familiar with the construction industry, take a lot of this thing out of those things.

Toby Brutsman (14:43):
Um, but it’s always good to just double check and make sure, make a phone call to somebody and email, Hey, you know, we’ve not been paid, is everything going okay? Then we can alert them to what we may have to do. And then a lot of times those conversations as the credit team has, can solve those issues before they become a problem before it gets to the expense of having a lien filed or a long-time filed, uh, it keeps the communication flowing, um, between all parties. Uh, you know, I don’t think really anybody wants to have a lien or a bot file, but, um, they’re there for that specific reason for the supplier’s perspective. Uh, I wish more contractors actually, or more tradesmen or of our customers actually utilize those lien and bond rights because they have the same rights we do. Um, but there’s, uh, an education portion of that. A lot of them don’t understand it or know how to, um, and that’s where we, I think we can also help our customers become a better business partner by educating them on the processes of what needs to happen.

Brandon Davenport (15:41):
Yeah. And to your point there, uh, I mean, we’re of the same mindset, the same school of thought, wanting people to set those expectations up early and often throughout the course of a project. And, you know, you look at the course of the last 12 months ended up itself. Um, there year over year, there’s been a 70% increase and filed CLA filed claims, liens, and bonds across the country. And we’re able to allocate that information using the county recorder data that’s available to us. And, uh, it is moving in that direction for sure, Toby, like you bring up a great point that you wish more and more people would be utilizing these rights early and often I’m curious cause you use a great insurance analogy that actually a lot of my team uses when they’re educating someone on, you know, maybe utilizing more notices and, and, uh, notices of intent, uh, as a way to protect themselves before that lien, uh, if, if you were in, in, you know, maybe, uh, my position perhaps, right? Like how might you educate a colleague on encouraging them to maybe send, uh, an extra notice or may protect themselves on an extra project or two where they do have lien rights, but have decided not to because of a relationship.

Toby Brutsman (17:03):
Yeah. I love the questions you asked Brandon, because I think that there’s, there’s never really an easy answer for that relationships are the toughest part of, of what we do in my opinion. Um, you know, we get pushed back a lot. Well, if you filed notices of filing is they’re going to take their business away. And I get those conversations quite a bit. Um, it’s never easy, but it’s a business decision, right? I mean, we don’t want to lose a customer, but we also understand what we’re in business together. And so I think sometimes the way I like to approach those conversations are let’s help the customer understand why we’re doing that to help them get paid. Um, right. I mean, if you have a common goal together, the two of you could use and we take the position of, Hey, we’ll go ahead and file the lien of the notice if you haven’t been paid, or if you’ve had, you know, a delay with a general contractor or an owner, would you mind if we reached out to them to see what the issues are?

Toby Brutsman (18:00):
Um, and we can usually get to the bottom of those pretty quickly and again, get the portions paid that we are owed. A lot of the stuff that gets lost in that though, is we can only get more scope paid for the material that more supposed supplied, because our notice covers our material. It doesn’t cover our customer and the labor that they had or other vendors that they’ve done. And that’s where I think they begin to understand, well, you know, why didn’t you guys get paid for everything? Well, we didn’t supply everything. We only can. We only can cover what we have a vested interest in. Uh, there’s a, a big education, I think that is needed, um, in the construction industry, um, that regardless of the size of the company, um, you know, whether it’s the big conglomerates that are nationwide or international or the smaller mom and pop organizations, how important that the lanes are, the notices are, um, notice is concerned, you know, as in some customers see them as just high price collection letters, but, you know, they’re required by the state to preserve your rights.

Toby Brutsman (19:01):
And there’s some validity to those. There there’s some, some legal law, you know, jargon in there that, that help, uh, kind of make sure that everything is done. And it’s the normal course of doing business in whatever state that you’re in. And construction-wise, so I guess I’d ask the question. Why wouldn’t you do the notices? Um, you know, no one’s ever made a hundred percent correct credit decisions, right? Uh, and so that’s where those notices and, and unfortunately it leaves a month lamps. If you have to proceed with them, make our jobs a little easier for us to swallow. We may take a little bit of a credit risk on somebody seeing what we’ve got in front of us before we ship them material. But on the backside, we know that we’ve got some security now, please don’t mistake it here, liens and bonds. Aren’t a guaranteed way of getting paid. Uh, I, they have horror stories about that, but that’s a whole different sub chapter of conversations.

Brandon Davenport (19:50):
No, and I love the way that you described that also with, with your customer and the NAEP and further up the payment chain. It it’s a, and now it’s not you and the customer across the negotiation table. Now, now we’re sitting across each other and you got your arm around them, which oftentimes is what spurs growth in an organization by having that stronger relationship. I love to learn a little bit more about, you know, the relationship with Levelset and how it’s helped spur some of that growth then protect jobs throughout the course of a long time we’ve been working together.

Toby Brutsman (20:23):
Yeah. I I’ll tell you, I love this question. Um, because I’ve been with Levelset now for 10 plus years, um, uh, as Ford Alliance started out, uh, or when I started with borderline, we made this switch and I think run 2010, uh, to go with Levelset from a notice perspective, uh, for our Texas portfolio, uh, we were kind of new to the Texas market. Um, and we had one branch, so we kind of, um, you know, reached out and were able to, to, to get Levelset at the time. And it was under a different company name for us to, to, um, to do our notices for us since then. Um, probably I guess what, five or six years into the relationship I had, uh, a phone call, um, from Levelset asking if I would be willing to participate in a phone and a conversation with another company, uh, they were interested in Levelset on wanting to know, um, if, you know, if I would join it and said, sure.

Toby Brutsman (21:19):
So I jumped on that phone call a little bit. I know it was actually the president and CFO of the company that I am, that we are with now, uh, with more scope, uh, they added a Levelset about 18 months before they, uh, acquired Fordham line. Uh, so it was fun to kind of know, uh, that I helped bring, uh, a valuable vendor from, from my end to the more SCO side. Uh, and then coming on to Maurisco, uh, immediately knowing you give me confidence that I do, one of the vendors knew how to use it, cause I’ve been here quite a while. Uh, but also, uh, the growth that went through with Levelset and, and from the beginning stages of, of, you know, when you guys were much smaller and just have the operations in new Orleans to what you guys are now, um, you know, the, the growth that, that the levels that I refer to Levelset is, you know, not just a notice provider, but an education portal and almost kind of like a tech company, you guys have done so much, uh, in, in this, in the years that I’ve been with you guys and what you’ve been able to do for us and how we be able to grow our portfolio.

Toby Brutsman (22:21):
We now have seven branches in Texas, uh, and we’ve not been able, we’ve not had to, to worry about doing any type of a tectonic shifting, uh, with you guys, you’ve been able to grow with us. You’ve been able to expand, you know, the portals for us, that we use. One of the best things I love about, um, Levelset is that, you know, as we bring new people on board levels that embraces our onboarding and you guys have actually become one, but not just whether you know it or not Brian, but you guys are part of our onboarding with our new team members where, you know, our team members get about 90 minutes, uh, within the first week that they’re hired, uh, with a Levelset individual to do the training for everything, and they get the soup to nuts exposure. Um, there are so many things and I read about two years ago.

Toby Brutsman (23:06):
I think we, we really started to notice, um, an uptick for us in the waiver. It’s not that we didn’t know they were there because everybody knows waivers, but the volume of waivers with the business that we were doing, and it became such a lag for us that, you know, we reached out to some vendors to say, Hey, how are other people handling this? Well, bilevel said, had, you know, came to us and said, Hey guys, you know, we haven’t really done this that much, but I think we can implement something. And within a week Levelset had, you know, taken 40% of our waivers off of our team, uh, and able to handle, handle those through the portal, uh, which again, you know, it was not something we ever thought that we would use a vendor for. Um, but it was only because we didn’t have the right vendors in place.

Toby Brutsman (23:51):
Uh, the trust that we have and, and that the growth that global set has been able to give to us, uh, has taken so much off of our team’s plate, allowing them to be much more efficient in their daily duties and responsibilities. It saved us headcount. Um, and then, you know, you continue to, to, to grow and you give us more of, um, uh, details and experiences and service levels. You know, recently we, we went through, um, a portfolio, uh, um, I guess, look over is what I call it, but with one of, uh, Levelsets individuals about, Hey, these are things that we offer that you don’t necessarily have, but these are things that have been come in the last 12, 18 months Levelsets of constantly growing company. There’s a lot of different things that are happening there that, you know, we lock into certain things that we do on a consistent basis, but you guys are leveraging the technology that’s out there using items and things that we’ve never thought about helping us to continue to become more efficient, uh, to be able to look at things differently that have been antiquated in the past.

Toby Brutsman (24:53):
And that we’ve just become accustomed saying, well, that’s just how we do it, which is one of the worst things you could ever tell anybody as well. We should do it that way, because it’s always been done that way. A Levelset takes a look at it from a perspective of, okay, well, what if we could change things? And then not only do you take a look at it, you also explore those opportunities and find ways to, to, to help your customers. And in this case, us, uh, be able to implement things that aren’t cutting edge in many ways, um, that, that put us in a position of being, being able to give more out of our people. Um, it really Levelset for me is really the perfect business partner, uh, with what you guys are able to do and offer us and our team.

Toby Brutsman (25:33):
Uh, and I, I I’m, I’m always excited about what what’s new, that’s going to come out, uh, how you guys going to be able to leverage technology for us or for, you know, your customers. Again, that’s going to make something else that we haven’t thought about much easier. Um, you know, and I’ll tell you something that I really think is fantastic is we’ve, we’ve struggled for years trusting the data that we get from the field about the job information is the job information really correct? Maybe somewhat correct, maybe 80, 90%, correct. But we all know garbage in, garbage out. If the information comes in wrong for the job, no matter the notices and liens you file. If it’s not right in the first go out and first go around, it’s not going to be right on the backend, but lemme set does a lot of the vetting.

Toby Brutsman (26:17):
They do the scout research portion for us, which I love because that takes a lot of the pressure and the guessing work out of it. We can send the notices, but how do we know it’s really good until we actually filed the lien? Then we find out it’s not, but the scout research side does a lot of that for us. They find out who the general contractor is. They find out, you know, the address to the project, um, and the day and age that we live in right now, information and data flows, and you guys have access to those things. It really make our jobs not only so much more efficient, more accurate.

Brandon Davenport (26:48):
Yeah. I, uh, I’m curious. I mean, you’ve, you’ve been a part of the Levelset family for a long time, so this might be hard to recall, but you mentioned garbage in garbage out, right. When it comes to getting information from the field, uh, I’m going to put you on the spot a little bit, if you can think of one, uh, what’s like the silliest thing you maybe got a, you know, circa 2008, 2009 before, Levelset where you thought, come on salesperson. Like, what are we doing here? Like, are you even trying,

Toby Brutsman (27:19):
Uh, I have so many and most of you on this call, just smile when you hear that, because there are horror stories, but I once was told by a salesman that, um, it, there was no owner on the project. No, you know, there’s gotta be an owner. You someone’s doing something for a land, but, uh, you know, you get those and you just kinda roll your eyes. Um, you know, we get, we get pushed back a lot on public work, right. And, uh, you know, every public job, depending on the state, most of them have the bonds that are out there, but our sales team doesn’t know. And we try to educate them as much as we can, but I get a lot of, well, there’s no bond on the job in the state of Texas. It’s required if it’s over a certain dollar amount.

Toby Brutsman (28:05):
Right. But they don’t want to ask. They’re afraid to, um, and that information is public, right? So you can get that information, but it’s the relationship they’re afraid to ask for the pushback of the customer. You know, when you approach it from a, Hey, there’s gotta be one out there, guys. It’s public information. We sometimes have those conversations that can have those conversations, a little easier, uh, call a general contractor and say, Hey, look, you know, you had to win the bid and you had to put the bond up when you put the bid in there. So it’s got to be, generals are usually, oh yeah, here’s a copy of the bond or here’s the one information, but it sensitive. And so, you know, you have to have those conversations with your sales team to understand, um, how to approach those. They’re just not aware, right?

Toby Brutsman (28:47):
I mean, it’s like me going into to, to NASA. I would have no idea, but somebody who’s familiar with that, it’s like, oh, it’s no big deal here that, you know, we are subject matter experts. And so we try to make sure that we smooth over as much as we can. And when someone gives us a line of, well, there is no owner for a project, you kind of roll your eyes and say, okay, well, let’s go back here. Cause I’m sure there is. And you find that information. But, um, I, I love our sales team, um, because I think it’s a chance for us to, to grow together, um, to bridge that gap. And I think, well, I know I’ll tell you, Brandon, um, you find a credit team member and a sales team member that are aligned together. Um, and you will find a very high performing portfolio, both from a gross profit and low delinquency perspective. So the, the opportunity for us to grow with our sales team, it means nothing, but, but, but pure, you know, solid relationships and, and higher profit for the company.

Brandon Davenport (29:50):
Yeah, for sure. And, um, quick comment there, and, uh, I’ve got a couple more questions, um, for you, but it’s related to some of the public information that you talk about and how credit and sales teams can come together to form that machine. That’s really gonna grow fast. And at a healthy rate, I was actually talking to a gentleman on my team earlier today and oftentimes the payment expert group over here uses the Levelset product actually to be able to provide value and see who might be able to benefit from our services just like for SKO. And, uh, we noticed that there’s a couple of states that are, uh, undergoing, uh, Tennessee and Arkansas in particular, um, are they have current legislation out, uh, house bills, uh, to move retainers laws in Tennessee and then a prompt payment law in Arkansas. And so we’re looking through this together and he says like, I don’t want to just use this as a, as a way to show like these people, like, you know, what they’re potentially missing out on just like that, you know, the people are like, yeah, like, you know what, like let’s have a conversation and, you know, it’s, it’s little things like that.

Brandon Davenport (30:58):
You know, for me, in my perspective, like I’ve been a benefactor of the growth that you’re talking about a Levelset as well. Uh, I’ve been over a little over two years. I’ve seen a lot of changes as well. A lot of the new products as well that I’m going to unpack here in a little bit, the toolbox, um, weren’t here when I first started and it’s pretty cool, uh, to be on the proverbial rocket ship.

Toby Brutsman (31:18):
Yeah. I will tell you what you guys are today from where you were, you know, 10 plus years ago. I’m very blessed to be able to seen the growth and taking full advantage of it. So yeah, you guys have done a hell of a job. Well done.

Brandon Davenport (31:32):
Thank you. We’ll, uh, I feel the same way and that’s a good transition actually into what life would be maybe without Levelset

Toby Brutsman (31:43):
A lot more chaotic I’ve lived those lives, uh, prefer not to go back in that direction. Um, you know, I talked a lot about the, the efficiencies we’ve gained, um, and Levelset, you know, has taken a lot of the heavy lifting or the minutia of the day-to-day, you know, waivers of signatures and things that we’ve done. Um, and I’ll tell you, it’s easily added up to about 35% of our time gained back from some of the stuff that we, you know, have been able to transition over to Levelset. Um, but you know, not just the day-to-day stuff, but the better confident decisions that we’ve been able to make, because the information we know is, is getting vetted. Um, being able to trust that process has now allowed us to make better and stronger credit decisions. Um, you know, Levelset, for us, one of the big key factors was, you know, everybody who’s in Texas is aware of what the 15th is and the, that it can be.

Toby Brutsman (32:40):
Um, but Levelset was able to early on distinguish for us, Hey, we can give you guys a little bit more time, uh, for your customers to, to pay. Um, and that was great because it gave us a little bit of a competitive advantage. Um, and, and there’s so much that goes on behind the scenes with the mailing and the notices and all the processes and, you know, the certifier and th those are, I’m sure there’s a lot of other service providers out there, but, um, that portion of giving us a little extra time to get that done, rather than cutting it off the day before or whatever, um, was very, very big for us. It helped us grow, uh, in a market for the Texas market that we’d never been in before. Um, and we were looking for every competitive edge we could, but Levelset was able to give us that.

Toby Brutsman (33:24):
Um, and, and we were able to, to capitalize on it in a much quicker growth rate than we anticipated, because it was a selling point for our sales team. So we found a common ground, um, and that those were things that, that were early on. Um, but as we continue to grow our credit team and the acquisition that we went through in 2018 with Maurisco, um, and the portfolio growth, you know, there was very little, if any hardware that we had to do, you guys have already implemented with systems. Um, there was easily, uh, the portals for us were easily manipulated from a reporting perspective. So our credit team members at a moment’s notice and can pull anything they need to out of the Levelset portfolio, uh, with all the data that goes in there and they can find, you know, the jobs, they can find waivers, they can find notices.

Toby Brutsman (34:14):
All of that information is at their fingertips. Um, and if we decide to file a lien, we can go through levels of to file the lien. It’s taken away a lot of the extra, well, let me gather, gather all the invoices, let me gather all the notices. I’ll put them all together and send it off to an attorney. And now it’s a point and click, um, you know, what used to be hours to file a lien or minutes, um, the cost savings that we have on those, you know, the, the volume we’re able to do. And as we continue to grow as a company, knowing that our vendors don’t have to have a whole extra this or that it’s folded into a system for us, that we can grow without having limits or capabilities that, you know, other vendors would have a little bit of hard time handling.

Brandon Davenport (34:56):
Yeah, absolutely. And, uh, one of the keywords into a hot word across the entire industry right now, acquisition, right? You go back to that and you harken also back to four line and, you know, when your first purchase by buy more and how that experience went here, we are, again, you know, not too long after a recession recessions, when that happened, same thing here. People are buying each other up. When we look at the entire, uh, us market for mergers and acquisitions, uh, 2015 was the biggest year, year to date. And we’re now it’s 2021, and we’re about three quarters of the way there. And we’re right there. We’ve already almost surpassed 2015. It’s a big year for it. Right. I think you’re, you’re getting the point here. And, uh, I’m curious if you’d, um, you know, talk a little bit more, um, about that acquisition, you know, you’ve, you’ve, you’ve done an awesome job, like giving us like the peek behind the curtain of what it looked like from an operational standpoint, but, uh, I, I’d also love to learn a little bit more about what that looks like in today’s world, uh, for more SCO, um,

Toby Brutsman (36:14):
And you know, I, I, I’m not privy to know, um, what the M and A’s are for us as a company. Uh, I will tell you that I think that there’s, um, COVID has probably done, um, it’s its duty, uh, during this last 18 months or however long it’s been that you will likely see a lot of companies that will, will be part of the mergers and acquisitions going forward. Um, I’ll speak to, to how I think, um, you know, the Levelset side can help and I’m going to go back to, um, when we were first into the Dallas market, um, we were using Levelset and we had, um, this is 2012. We had an acquisition and it was an itching acquisition for us because we purchased turnkey. So we bought assets, we bought AR we bought debt, uh, people inventory. So it was a total turnkey deal for us.

Toby Brutsman (37:09):
And, um, one of the first ones we ever did, but there was no idea for us on the credit side to, to kind of break it apart into chunks, to know exactly what we were getting from the AR side. You know, wasn’t really good. It was a really bad, was it somewhere in between, um, and with, in about three weeks, going through the Levelset side, we were able to determine pretty quickly that, all right, we, we were, we were in much better position than we thought, and I’ll tell you, we’re sitting in a credit desk. Your worst nightmare is, oh my gosh, we just inherited, you know, $5 million of AR and 4.5 million of it is uncollected. Right. Um, but we were in much better position, but we, I had never been able to decipher that much data, uh, in such a quick turnaround time span.

Toby Brutsman (37:54):
Now that was eight, nine years ago. It would likely be something I could turn around in about three to five days now. Um, it’s crazy how the times have, you know, made everything so much quicker, but, um, using what we have now with Levelset in being able to position ourselves, we could understand where we are better at what is the emergency issues for us. If we do have to secure some AR, uh, or if we, you know, are okay and putting our information in the system to be able to get protected going forward on future sales, um, that Levelset portion for us was critical for us to, to know quickly, are we in a bad debt situation? Are we in a tailspin? Uh, where are we in and what are the things that we can anticipate going forward? That was, that was very helpful for us. And I remember that very clearly.

Brandon Davenport (38:42):
Yeah. And it works both ways, too. I mean, you, you give a great story there about the turnkey situation from the buy side sell side as well. You have a lot of people out there in the market right now that are for a plethora of reasons. Maybe they just want to get out, maybe, you know, they’re ready to retire, whatever the case is and are ready to sell. Same thing goes, if you want to set yourself up to be able to have, uh, basically put yourself in this situation where you have, uh, the best, uh, PE ratio, um, so that you’re gonna look attractive to buyers. But, um, with that said any other advice, tips, tricks, um, before we talk a little bit about the toolbox,

Toby Brutsman (39:24):
Uh, I’ll just tell ya, I, I think Levelsets, uh, a great business partner, as I mentioned before, if you are in credit and do any type of construction, um, supply of any kind, uh, I think levels that it does, it does a fantastic job, uh, with the information with the data, with the ease of use, with the ability to grow. Um, and I think it’s something that everybody really should look into, uh, in, in every way. It may not be the entire, you know, beautiful Cadillac that you want, maybe pieces imports that that fits you better than others. But I definitely think that there’s, there’s value that Levelset adds to us on a day-to-day basis. I would highly recommend everybody taking a look at.

Brandon Davenport (40:06):
Yeah, absolutely. Um, and at the end of the presentation today, there will be a, uh, an email and a way to get in touch for anybody that is interested in learning more. Uh, you can also just contact me, my contact information will be available in the recording, uh, this as well, if you want to talk a little bit more, um, about the relationship that we build with folks like, uh, Tolkien Moscow now for, uh, the toolbox in and of itself, uh, I’ll unpack it with, uh, five categories. Uh, Toby would still love for you to chime in at any point in time, any use cases, uh, throughout the toolbox where you’ve seen it have an impact. Um, oh, wait, let’s see. We’re going to, actually, we have a question, Valerie. Thanks for chime in. Uh, this is a good transition point before I get into the toolbox. It’s a question for you, Toby. Um, and it’s really just like what your thoughts are on the new lean law, uh, for Texas starting in 2022.

Toby Brutsman (41:06):
Um, first off, hi, Valerie. So in a while, and we’ve, we’ve, we’ve known each other for awhile. Um, a couple things first off, I’ll answer your question. Um, I think it’s going to lead or potentially lead to some higher delinquency, uh, if you’re not familiar with what the, the, the lane laws are in Texas, and then how they’re changing, I encourage each of you to, to, to find out they become effective in January. Um, and I think it’s, it’s, it’s going to more SCO RN, some money from postage perspective, everybody, you know, the second notice or that the 15th day of the second month has been a go away. Everybody’s going to move to the third month. So I think you’re going to see a little bit of an increase in delinquency. Um, and those notices that were sent out early on, um, drove a lot of the payments for us in the middle of the month, which is always a big time for us to get money in the door.

Toby Brutsman (41:58):
Um, I think that that’s where the credit team is going to have to be on point, um, early on to avoid that slippage. Um, making sure that, you know, the communication is, is still out there and the expectation, uh, we often feel like our customers take the 15th to be their terms, um, where no, our terms are what they are net 30 in our case. Um, but they pay before the notices go out. Now, if you move those notices back to, you know, the 15th day of the third month, does that mean the customers, you know, think that they can pay at 75 and 95 days or 105 days? No, but that’s where the communication comes in, that we have to, um, be ahead of that. I, I tell our team all the time, guys be early to the conversations. Um, don’t be reactionary, you know, don’t, don’t react to somebody who’s calling be ahead of it and be proactive so that we can have the education, the conversations beforehand.

Toby Brutsman (42:50):
Um, that being said, though, I don’t know if you know, it’s not going to go away, they’ve made the law change. And so we’ve got to be prepared for it. Um, and who knows, we may find out that there there’s some benefit to it. You know, there, there, there it’s yet to be, I think figured out entirely. One of the questions I have that I’ve posed to, to Levelset into our attorney is, or the 15th notices something we can still send. Um, because I think it’s not an, and it may not be required. Like I said before, they could be expensive collection letters. Uh, and if we send them out, is it something that’s going to be, you know, maybe frowned upon, but maybe we pick and choose. I don’t know, there’s a lot of different things. You can look at it. Uh, and I think it’s something that we, as credit professionals can have some good conversations with vendors like yourself, printing it, maybe something we can do from a best practices perspective in the state of Texas.

Brandon Davenport (43:40):
Absolutely. And, uh, I’ll use, uh, Texas as an example. Um, since, you know, we’ve got some good questions coming in about it and lean law changes you be in Dallas, me being in Austin, uh, to help juxtapose, uh, the rest of the toolbox. And, uh, for those unfamiliar, it can really be broken down into a few categories. You know, it’s management, uh, some of the, I guess, quote unquote necessary evils that go into protecting that economical insurance, I think is how, how Toby phrase it earlier. Some of the research that goes into making sure that there’s no garbage in garbage out so that you’re protecting your rights correctly, might as well do it the correct way instead of just not doing it at all. And then job radar alerts, um, which we’ll, we’ll unpack. That’s one of the things that I was particularly excited about.

Brandon Davenport (44:30):
And when I joined Levelset, cause that’s evolved a lot. And my 25, 26 months since I joined the organization, uh, lean waivers solutions, what that means for an organization, um, Toby upon that a little bit, and then contractor payment profiles and, uh, putting yourself in a position where you can make a more intelligent credit decisions. And from just going down the list, you know, you, you mentioned Texas lien law there again. And I think it’s obviously poignant because of where we’re at. And when we think about those changes that are going into effect, you know, traditionally it was either the second month or the third month dependent upon, uh, the actual, uh, type of project, your role amongst a few other things. And when we think about like North Carolina, you know, where were you originally hailed from like 15 days? Uh, we think about Oregon, which has the earliest turnaround date, uh, only eight days, uh, to be able to get some of those out. And what we found is by having the peace of mind, that no matter what, if you decide to expand, you decide to purchase another organization, right? Some of the things that we’re talking about from an acquisition standpoint, you have a partner in place that’s going to be able to grow alongside you. Now, Toby, before I move over into, um, some of the intricacies of, of research and, you know, property owners, uh, what other, uh, comments might you have about, uh, the lien rights process and how it saved your team’s 35% of its own time?

Toby Brutsman (46:04):
I think that the automation and the world that we’re in, you know, automation is going to become much more prevalent for us. So, you know, getting that automation down, um, putting our, our, our team in positions where they don’t have to do a whole lot of the research for it and putting what we hire them to do, uh, in much more of a, uh, proactive environment, having the data in front of them, knowing, Hey, you know, here’s 500 potential jobs, which is not out of the realm for us, uh, at the first of the month. And you’ve got two weeks to figure out which one of those jobs is going to happen, notice or lane or a bond file set on. And in some cases, you know, multiple, uh, you’re asking someone to do a lot. Um, and if you can put that information into a filter where, okay guys, here’s your notices, here’s your liens?

Toby Brutsman (46:57):
Here’s your bond claims? Um, here’s the second month, here’s the third month? Um, here’s the dollar amount, here’s the job number? Um, it, it puts it into, you know, a quick, uh, process for someone to be able to look at, make a decision, uh, move on, um, and, and, and tackle the bigger items. And it gives them a chance to it’s a web based system, right? So one of the hot topics in the last 18 months is remote work. Well, imagine trying to do this during COVID, without having the capability of working remote, uh, if this was something that was, you know, proprietary just to accompany a and you’re working remote, okay, maybe you can access it through your ERP systems or whatever, but now you can take this with you wherever you go. Um, and, and be able to access this whole reports, pull the data, um, be able to dig out anything and everything that you want.

Toby Brutsman (47:48):
Um, it it’s, it’s only going to get better and enhance it for us. And it’s been such a godsend for our team to be able to learn how to navigate the systems. Like you said, from a waiver perspective. Um, there there’s something, some things here I’m sure you’ll, you’ll touch on, but the chat box, you know, just being able to get legal advice or have a question on something, uh, the resources that we have at Levelsets, you know, at our disposal, because of Levelset gives us the opportunity to, to, to get back to customers to get the right information. Right. You know, we’re in an information world, but we want to be accurate with the information that we give out. And if we can vet that information and get it from somebody else that has it at their fingertips, it just makes us that much more efficient.

Brandon Davenport (48:32):
Yeah, absolutely. And, uh, when we think about the next item on the list, it’s it’s job research, uh, where we talked about garbage in garbage out, and this truly is like the cornerstone, the bedrock of how Levelset has evolved over time. It informs job radar, which I’ll talk about here a little bit. It informs payment profiles, which we’ll also talk about even the lien waivers solutions. And when we think about some of the challenges that people run into over time, oftentimes it’s that exact scenario that you talk about? Well, we just don’t know who that is. And so people have to start doing a little bit of digging to make sure that they have what they need in order to protect their rights, which oftentimes discourages people from wanting to protect those rights. Uh, I’m curious, what other comments or thoughts do you have about job research and you know, how it’s impacted more SKO and even forward?

Toby Brutsman (49:37):
I’ve got a really specific story. That’s happened not too long ago for us. Um, anybody who’s been in construction for any length of time, um, knows that can go south or go bad, and your customer is now no longer on the job and has been replaced by another subcontractor, right? How are we supposed to know, because would likely our customers a month or two behind on payments to us. And we find out after the fact, and usually rights are gone, but in job research, we can get an alert from level stuff. It says, Hey, this customer is on this job site, uh, now, um, and how do you want us to update your notice? Um, that’s information that we would have likely taken 60 days, uh, to find out. Um, but now we can shorten that to a much quicker response and capture the lane lines. Those are things that you having the technology and having a Levelset, uh, as a partner helps us to avoid pitfalls.

Brandon Davenport (50:34):
Yeah. I’m glad to say partner there as well. You, cause you, you said, you know, back when we were sealing, you know, more than a notice company, you said we’re almost like a tech company now, which I would definitely agree with, but, uh, want to make sure that, you know, we underscore, you know, the human aspect to think about hundreds of data engineering and research professionals going through and verifying all this information that you’re talking about. Like that’s the power of what we’re able to do, which, like I said, inform some of the other things that we’ve rolled out over the last 24 months. And one of those things is the job radar alerts being able to know beforehand before you take that job, what the issues are going to be. So that way you and the salesperson, like you said, now we’re on the same side of the table. We’re going in together. Hey, there’s some expectations that need to be set. If we’re going to take this job, want to make sure that you Mr. Or Mrs. Salesperson get paid as well. And we’re not waiting around with, uh, some uncollected AR or

Toby Brutsman (51:37):
Years ago, years ago, Brendan, sorry to cut you off. But years ago, you know, we would be selling one job and, and the salesman would come and say, Hey, this customer wants to buy material for this job. That’s unfinished. Uh, and you know, we would ask questions, okay. Why all of a sudden now are we getting on that job when we didn’t get the full job before it led to speculation of maybe the customer was cut off from another vendor or something like that? Well, with job radar, we can know for sure, Hey, the reason this customer X is not, you know, buying from them anymore is because that supplier has now filed a lien on that project. Wouldn’t you like to know beforehand before going into a job that is bad, that it’s a bad project. Would that likely change your decision? Probably, uh, and life is about, especially the, with the, the credit roll with it. It’s about, you know, knowing information ahead of time. You have information, you can make the best decisions. And this is allowing us to be in a little bit more of a, uh, an even playing field, knowing the projects that we go into before are not already somebody else’s nightmare.

Brandon Davenport (52:41):
Yeah, absolutely. It’s um, in some of the, like you said, nightmare scenarios, it’s less, he said, she said, and no, here are the cold, hard facts. Let’s just work to a solution together and continue working together with one another on future projects as well, which, um, I’ll go through it. I know, worry about seven minutes up. I, I said that would leave 10 minutes, um, for any additional questions. So I’ll wrap up with the last two proportions of the toolbox and leave five minutes, um, for any questions. So, uh, you know, lean labor solutions, uh, the big challenge that we’ve seen over time of course, is education around partials versus finals, conditional versus unconditional, while we’re like smaller organizations, uh, maybe not having the education piece that we’ve talked about a lot today on that unconditional versus conditional, but also just understanding the requisite documents that come with it. And no matter what state that you’re working in, a lot of people don’t know that like in Texas, right? Or in Wyoming, Mississippi, there’s some requirements uh, around notarization too, we plan on growing into a market as big as Texas, want to make sure that you’re prepared for it. Any other comments around lean waivers,

Toby Brutsman (53:56):
They are a time killer for our credit team. They are something that are necessary evils for us. So I was extremely excited when the lien waivers solution to became a part of, of our day to day stuff with Levelset. Um, it, it created such a time-saver for us, um, and was very efficient and our customers enjoyed it too. I mean, it was something that, that they were able to get a better response time for us, uh, that we had in the past. And, and, you know, we started to be able to get to our portfolio of collections a lot more because that responsibility was taken off of our plates. And so again, this is probably one of my favorite, uh, toolbox items for us as a company.

Brandon Davenport (54:41):
Yeah, absolutely. In a last portion of the toolbox and we’ll open it up to Q and a, this one’s interesting to me because we talked about bridging the gap a couple of times as well, uh, with sales organizations internally and with payment profiles, um, over the course of the last, uh, about 18 months, uh, when these, uh, really started to get rolled out within the Levelset organization, uh, we’ve noticed, uh, this fear, the most sales people at our customer for our customers that have signed up for accounts with Levelset as well, because they want to be able to work with the credit teams, whether that’s a sales rep, territory manager, even CEOs of some companies setting up their own accounts within Levelset. So they can work in conjunction and say, Hey, like, you know, interested in taking these jobs interested in taking these jobs. So it’s, again, less, he said, she said, everyone’s on the same level playing field. Um, last comments. And then, uh, we can open it up for any other Q and a.

Toby Brutsman (55:47):
Now I think what you guys are building. And like I said before, I can’t wait to see what else you guys have in the hopper, bringing out. It’s, it’s really bringing a lot of the suppliers and the construction world, uh, kind of to a common platform, uh, that I think is going to benefit all of us. The more we learn, how to use it, the more we learn, how to communicate better with it and the information that we have. So again, a very valuable tool that’s ever evolving.

Brandon Davenport (56:14):
Yeah, absolutely. Well, I’m going to hang around for the next four or five minutes for any questions. I know I missed a couple earlier and I’ll make sure to get back to you if I get to it. Um, within the chat feed, um, Toby, it’s been a pleasure.

Toby Brutsman (56:29):
Absolutely. I’ve really enjoyed it. Thank you.

Brandon Davenport (56:31):
Yeah, likewise, it’s been a pleasure getting to hang out today, um, and to learn from one another. Um, that’s all really, God,

Toby Brutsman (56:41):
I’m happy to help and, and encourage everybody. If you haven’t had a chance to get involved with Levelset and see all the layers that they have, uh, take the time. Uh, I think you’ll find that it’s very beneficial in multifaceted ways for us. So, um, if you have any questions or anything I can help with, please let me know. Uh, Brandon, thank you again for your time.

Brandon Davenport (57:02):
Okay. Thank you. Bye everyone. Bye guys.