Construction Company Fails

A story about how Ramon built and eventually had to close a construction company in his early 20s, despite having no construction experience.

"I went to buy an official construction outfit to look like a construction guy. I went to a job site the next morning. The client gave me a tour and I couldn't even understand the words he was saying about wiring and floors. I was playing along but in my mind, I knew there was no way I could do this, plus it was dangerous. When he went out to run errands, I waited for him and was honest - told him I don't know anything about construction, I just started yesterday.

Because he was an entrepreneur, he laughed and actually gave me work. He gave me a great tip: to own a construction company, you don't have to know everything or do it yourself. He said to find freelancers, focus on getting projects, and outsource to freelancers. That's what I did - found an electrician, plumber, everything needed for a crew.

Two weeks later I got a second job. My cut was around 5k. Within a year we grew to 20-24 people and did close to €1 million in revenue. To scale, I solved the project continuity problem by targeting real estate investors at local meetups. I met the biggest real estate investor in my region who was buying 20-100 buildings monthly at foreclosure. He became my main client until the end.

But I made mistakes. Cash flow projection was the big one. In construction, you have to put money upfront - pay the crew every Friday, buy supplies - but only get paid when the project is done. The faster we grew, the more money we had to put out. I also grew too fast, had to hire people I normally wouldn't have, and lost grip of the business. After 3 years, I had to close the company."