David vs. Goliath: How Independent Service Businesses Beat Private Equity Giants

They're coming for your customers.

Private equity firms with billion-dollar war chests are buying up service businesses left and right.

They've got fancy vans, massive marketing budgets, and all the latest tech. They can outspend you 10-to-1 on customer acquisition.

So how do you compete when Goliath has deeper pockets than you'll ever have?

Over the past few weeks on the ShareWillow podcast, I’ve connected with contractors who are not just surviving this, they’re thriving. 

Here's what they figured out: You don't beat private equity by playing their game. You beat them by playing games they can't win.

Private equity firms are chasing service businesses for three key reasons:

The result? PE firms are willing to pay premium prices and operate at losses for years just to gain market share.

They'll subsidize customer acquisition costs that would bankrupt a small operator, betting they can win through sheer financial power.

When your competitors can outspend you 10-to-1, they may have the newest trucks, the most expensive marketing campaigns, and the latest tools and tech. But there’s one thing they can’t buy… 

Genuine relationships.

Think about it: When private equity cash takes over, what happens?

Meanwhile, you're still the guy who remembers Mrs. Johnson's dog's name and asks about her grandson's baseball games.

You're the one who stays an extra 20 minutes to explain exactly what went wrong and how to prevent it next time.

You're the one who brings a blanket when someone's heat goes out in the middle of winter.

Private equity firms optimize for KPIs. To win: You optimize for relationships.

Craig from Ocean State Air Solutions told me something that blew my mind (and should scare any PE firm reading this…).

There's another company close to his town that sold to private equity. After they sold, every single employee walked. Not some of them. Not most of them. Every. Single. One.

The private equity firm thought they were buying a profitable HVAC company with a solid book of business. What they actually bought was... equipment and a customer list.

Here's the thing I realized: In service businesses, customers follow people, not companies.

Think about your own life. Your barber, your cleaning person, your lawyer – you follow the person, not the company. If my barber moves to a new shop, I’ll follow him every time. I don't care what company he's at. I want him.

This is why it's so incredibly important for any company – whether you're PE-backed or competing against them – to retain your people. If the people leave, the customers leave too.

And that's exactly why small contractors have such a huge advantage. You can keep your people happy and motivated in ways that private equity firms can't.

So how do you keep your best people when private equity firms are throwing money around trying to hire everyone?

Make it crystal clear how they win.

So many companies overcomplicate their pay structure. Techs need an accountant just to know what they're taking home.

If your techs can't explain how they get paid in 10 seconds, it's too complicated.

Private equity isn't going away. They're going to keep buying companies and flooding towns and cities with marketing dollars.

But you have something they'll never have: The ability to be genuinely human.

Start thinking about every customer interaction as an opportunity to build a relationship, not just complete a transaction.

Document the personal touches that make your service special, then train your team to do them consistently.

Remember: Trust wins. If you can become the most trusted in your market, the customers will keep choosing you and keep coming back.

Want to dig into anything we’ve shared today? Let’s hop on a call to discuss how ShareWillow can help.