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Dirk Elsperman

COO of Tarlton Corporation / President of AGC
January 6, 2020

Dirk Elsperman

COO of Tarlton Corporation / President of AGC

Dirk Elsperman is the COO of Tarlton Corporation, a St. Louis-based construction company started by his grandfather in 1946. This year, Dirk has also been serving as President of the Associated General Contractors of America (AGC).

In our conversation today, we talk about running a business with your sibling, competing in adventure races, the child-like instinct to build, and the number one highlight of Dirk’s AGC term so far.

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Transcription

Dirk: So my grandfather was born in 1904, and went to school at Washington University as a 16-year-old. So he was pretty young. But that's when he graduated from high school and went to college, graduated then I think he went to Europe for about a year, or at least a little while traveling around as a young kid in the 20s, and then came back and worked for a construction company. Hume's Deal was the name of the company at the time. And it's kind of coincidentally, it's our next-door neighbor here today and it's known as HBD. But the predecessor was Hume's Deal. And my grandfather worked on primarily building projects in St. Louis.

When World War II broke out, he was on a project down in Southern Arkansas in Alberta, Arkansas for an ordinance facility they were building and they were down there about a year. And the recruiters came through and my grandfather decided to join the Navy and entered the Seabees and, you know, it was at a time when he was 37-years-old when all that went around. So he was kind of past the prime age, but wanted to help out the war effort and ended up part of that greatest generation folks. Came back from World War II and really felt he owed it to old man deal. How he always referred to 'em as old man deal. I owe it to old man deal to go back to work with them. I left him, I need to go back to 'em, but I wanna have an ownership stake and old man deal had two sons coming up in the business and wanted to pass it on to his sons. And so that wasn't available to my grandfather.
He knew a guy who knew two guys that wanted to start a business and they bought the assets of this G.L. Tarlton Contractors Inc, which was a kind of a defunct business. George Tarlton had passed away and it had bounced from a couple of different owners. And when they bought it, they basically bought some land and some buildings. And that was 1946 and that's kind of where we look at the start of the company.
Matt:  Did he ever talk about why he chose to keep the name, if it kind of was a defined company?
Dirk: The company, it had started in 1923 and there were four partners, and this was before people picked, you know, snappy names for things, you know, like Alphabet or Google or whatever. They thought that there was some name recognition with the Tarleton name that had been around for about 20 years. It wasn't a renowned construction company. Our family legend was that George Lock Tarleton was kind of known more for his political dealings and for his construction expertise and somehow seemed to get city contracts. You know, lighting straight lamps was one of his famous you know, when they used to have old gas lamp streetlights, that was his job. And you know, some other small municipal types of contracts. But, you know, he played the political game more than I think was a real builder..
They kept the name. And when my grandfather transitioned in the early 60s, he was like, you know, I'm tired of my projects making all the money and then the other guy's losing the money. And a couple of the folks were looking to retire out of the business. And so he's like, well, I'm either gonna buy them out or they're gonna buy me out. They decided they were ready to be bought out. That's when kind of the company started getting concentrated in our family's hands. And he kept the name. Yeah. And he kept the name because Elsperman is not as easy as Tarleton is for people to pronounce.
Matt: Yeah. You don't wanna show up to a sales meeting, go now, how do you pronounce your company name?
Dirk: Exactly. Today, it might work, you know, but I don't there were back then, no, not so much.
Eric: Yeah. So that was in the 60s. And then, so how old was your dad? Was your dad involved at that time when he decided to buy 'em out?
Dirk: Yes, he started working in the company when he was 14, probably in violation of all child labor laws, but worked as a carpenter in the summers and works through his college career and went to Purdue University. And I guess he had been working at the company full time as a project engineer for, I don't know, two or three years when all of this started happening. And, you know, his story is, you know, Hey dad, what would've happened if they would've said, ''Well, we're gonna buy you out.'' My grandfather's response was, ''Well, you know, we would have started our own company, you and me and your mother would keep the books.'' And no, that didn't happen. So we might've had a company named Elsperman. It didn't happen that way. And my dad was actively involved in the business running projects and I'm not sure exactly how his progression worked as far as when he really started taking control of the business.
I remember as a young kid when he came home after he had been named president and that was a really big day for us. I wanna say that was probably around 1972 or thereabouts. You know, that was really when the transition from my grandfather to my dad and then my sisters and I took over the business. You know, we did our transition around 2000.
Matt: Okay. At what age did you start hanging around the business? Was it still when your grandfather was around?
Dirk: Yeah. So I would come in on Saturdays, just about every Saturday during the school year. I would go on Saturday mornings, I'd go play sports in the morning, the Missouri Athletic Club, and then my dad and my grandfather would pick me up and we would have lunch together. And then I'd come back into the office on Saturday afternoons. Made sure we always got home in time for "Wide World of Sports," which you guys might not even know about.
Matt: I've only seen clips.
Dirk: Yeah, exactly. Well, you know, the agony of defeat. The thrill of victory and the agony of defeat, the guy going down the ski jump, crashing all that kind of stuff. I mean, that was before you had ESPN or anything else. And so that's how you got an update on what was going on in the world of sports.
Matt: Yeah. Do you have any early stories of seeing your grandfather and your father at work when you were young? A moment where you realized, oh that's what it's like to run a business or?
Dirk: Or be in a family business.
Eric: Or be in a family business.
Dirk:  So the stories that stand out or more about how my dad and my grandfather would always go to Musial & Biggie's restaurant for lunch. And Julie was always our waitress and she was as much of the family as those guys were. And that was always a blast. Whoever was in the office would go to lunch on Saturdays. And there was a real comradery between the folks that worked in the business. You could tell. And a lot of these guys were, you know, World War II veterans. So you know, this building stuff wasn't so difficult. It's like, you know, they're not shooting at us. So it's all good here.
You know, I think I started just more sensing the comradery of construction then, you know, Oh, that's what it's like to take off a building and do the estimate and do all of that kind of stuff. And that was at an early age. And then as you get a little older and I would go visit projects with my dad and get a real sense for the pride of accomplishment. When you're working on a construction project, you're not the only one. There's a whole team that's working on that. And if you embrace the team and do it well, you really create some fantastic things. And I was really coming of age when Anheuser Busch was going great guns in their competition with Miller and expanding their facilities here in St. Louis. And we were a big part of that and that was a lot of fun. So visiting projects down at the brewery was pretty darn cool.
Eric: That is cool. Do you remember how your grandfather transitioned out of the business?
Dirk: Well, I was about, I don't know, seven or eight, nine years old, so I wasn't active in all of that. And the honest answer is it was pretty darn seamless and very hands-off. And, you know, my dad has always shared the fact that it's like, man, you know, my dad turned over the keys. He'd given me everything he could knowledge-wise and it was time to see what we could do, what I could do with the business. And so when my sisters and I went through our transition, my dad really did the same thing and I was like, ''Man, you know, this has been great. You haven't been that overbearing ex-owner of the company looking over our shoulders. You know, you've made it so easy for us to kind of take the business and run with it.'' And he's like, ''Well, I just had the best mentor when I did it 30 years ago.'' So yeah, that transition from my dad and my grandfather was really pretty seamless. It was a big deal on the papers. You know, my grandfather was pretty well regarded in the industry, but I think my dad had made his own bones and been active as well. And it worked out very well for the company.
Eric: Yeah, that seems like it's a little bit of a unique story when it comes to family businesses, right? Like we've interviewed a lot of people and a lot that come from family business and we've gotten the whole range of, Oh man, my dad never let go. You know, he stayed in forever to uh, we worked fine together. You know, we haven't had too many people say, Oh yeah, he was super hands off, turn the keys over and walked away.
Dirk: Well, he didn't walk away. Both my dad and my grandfather are pretty similar in this. They didn't walk away. They came into the office every day, but just to find out what's going on. It's not to direct anything. My dad doesn't have any day to day responsibilities. My grandfather didn't have any day to day responsibilities. My grandfather came into the office every day till he passed away except for Tuesdays because that's when the cleaning lady was at his house. And so felt like he needed to be there so she didn't drink all of his scotch. I don't know. But you know, my dad still does the same thing. He likes to come in.
Last summer or last fall, he was down in Florida and he was having a great time and he's like, ''Man, it's really great. This has been one of the best times we've had down here.'' And I said, well pap, you know, you don't have to stay down there the whole, you can just take another week, take two weeks. There's nothing pressing back here.'' And he's like, ''Nah, I just got to get back and see my kids.'' And he wasn't talking about Tracy, Wendy and I, he was talking about the rest of the company. He likes to come in, get his cup of coffee, walk the hall, say hello to everybody, read the "Wall Street Journal," check his emails and then, you know, go to lunch with some friends or he brings his lunch and sits down in the middle of our office where we all have lunch together and that's what gets them up in the morning, that's what keeps them going and keeps his mind active.
Matt: What became of the Saturday afternoon lunch spot? Still there?
Dirk: You know, unfortunately, it closed, it was Musial & Biggie's and Stan Musial was there every once in a while on Saturdays and would say hi to folks. I at the time, you know, he's a great baseball player, but really didn't have an appreciation for how great he was until I went, I was in college and went to Cooperstown and saw all of his records. But yeah, that closed and then got converted into a nightclub and then now it's a part of our St. Louis Science Center, which is kind of fun because things come full circle, we are now working for our St. Louis Science Center, helping them with a new entrance to their facilities. So it's right in the neighborhood and it's kind of fun to see the circle of life and construction as well.
Matt: So when you got into your older years in high school, and how did you view career in construction, career in family business versus trying to forge your own way?
Dirk: Well, you know, as a kid, my toys were the dirt pile in the backyard, Lego sets, and Lincoln logs, tinker toys, Tonka trucks. When we got a little older, we went to the woods in their subdivision and would build more forts and do things like that. And it just seems like those were the real things that I always loved doing. You know, my lifelong dream was to come and work in the family business. Part of that's what you know. You see your dad and your grandfather working every day together and you think, man, that's pretty cool. But I also loved the world of construction. I worked as a high school and college-age kid as a carpenter's apprentice, which I learned a ton. I would do my classes during the winter break and then in the summers I'd be out on jobs, learned a ton during those summers.
And I did think for a while of going into medicine, partially because we had a good family friend that I really admired and he was a neat guy and there was an orthopedist and I had a couple of injuries that he helped me with and realize that orthopedists kind of do a lot of similar things that we do in construction. But at the end of the day, what I had always wanted to do is what I'm doing which is work in construction. And it's the kind of business that I'm a...I like numbers, I like the mechanical side of figuring out the puzzle, but I also like the social side of it too. And it satisfies a lot of my different needs.
Eric:  So, yeah, the toys of Tonka trucks and dirt piles. I wonder if in like 30 years there's gonna be some executive at a construction company going, you know what my game was Fortnite. I loved building stuff and I just knew I wanted to be in construction.
Dirk: Yeah. You know, you might be right because I think in 30 years we might be building our projects a little differently than we're building now.
Eric: Yeah. Yeah. That's funny how the toys change. So you decide to go to Cornell University and study applied economics and business management. Do you remember why you chose to go into those fields?
Dirk:  Yeah. So in high school, I was a pretty decent student and I was a pretty decent football player. So kind of combined all those things. And actually I started at Cornell in engineering because it was one of the top five engineering schools depending on how it was ranked in civil engineering. And I thought engineering was engineering. I got recruited to play football there, but I only played a year. I didn't really make the decision to play foot...decision to go there because I was going to play football. But it was a nice opportunity. I really chose it because it was a good engineering school and my philosophy has always been kind of play the best game you possibly can.
But what I found out was that was not necessarily the right engineering program for me. First off, it was all design-oriented. So there really wasn't anything that was construction-oriented. We didn't have any scheduling classes. We didn't have, you know, construction means and methods and classes like that available. And so I was getting as much from a construction standpoint through the hotel school at Cornell, which had a real estate track. And so I was burning up electives taking other classes and kind of looking at two years of labs on things that I really wasn't interested in. And so I transferred over to the business program, which was in the Ag school at Cornell and it worked out really well. In hindsight, maybe a construction management program would have been the perfect program for me because it's got this kind of it satisfies the quantitative stuff that I like to do, but also the social side of the business.
But at the time, those programs were still very new and kind of marketed as, well, you know, we take the kids that don't hack it in engineering or architecture and we put them into this program. And I was like, that's not a way to sell a program. I'm not doing that. And so that's why I took the civil engineering path and then ended up with this combo degree that's worked really well for me now. You know, I got enough of the problem-solving in my first couple of years and then got the legal and business side in my second couple of years of college. And so it worked out really well.
Matt: And then working in summers back in the company?
Dirk: Yeah, I did that for a while. Before I started working in the field, before I was old enough to do that, I lifeguarded. And then I got an offer from the guy that I had worked for as a lifeguard after I'd been working as a carpenter and he said, ''Hey, you know, I need somebody to help me manage some pools. Would you be interested in coming back and working with me?'' And I thought, well, that'd be a good opportunity because I was at the lowest of the low level of the totem poles at that time. And I'm thinking, Oh, you know, management, that sounds important. So I did that.
And then I also interned with a bank here in St. Louis, kind of my last summer of college because we kind of had a family rule. My dad had said, you know, if you wanna come back to the business, I would love to have you, but only after you've gotta go work someplace else for a couple of years. And then if you wanna come back then you can come back on your own terms. But my dad didn't go to work anyplace else other than Tarlton, and he thought that was really important to have some outside experience. I was always kinda interested in the finance side of things. So I got an internship with a bank here in St. Louis and then after college, I worked in real estate finance for three years before coming back to Tarlton.
Matt: So I kind of wanna dig into that leave and go do something else before coming into the family business because this is like a recurring thing that happens. Some family business have very strong opinions on that being a good thing. And then other family businesses tend to, I don't know not do that. What do you think are the positives and negatives of the go work somewhere else before you come into the family business?
Dirk: Well, I think the hardest thing to do is to go out and find your first job. Now, maybe not now. Kids are graduating school with plenty of opportunities, but it is hard to figure out exactly what you wanna do coming out of college. Back in the late 80s, it was not a real fertile employment hunting ground. If you didn't land something right out of college and on-campus recruiting and that was not as intense as it is now, you were gonna spend about three months pounding the pavement, doing informational interviews, looking for...you know, trying to meet anybody you could. We weren't all connected digitally the way we are now. So it took a lot of time to establish a network. And then you get your first job and that's a real sense of accomplishment.
I think that was something that was... One of those lessons that my dad learned and shared with me was he didn't, he always went to work right out of college with his dad. And he's like, man, it took me a while to feel like I was actually doing something on my own. You know, I wasn't getting to where I was because of my dad. It was because of the work that I was putting in. And I think that framed his thoughts on why we needed to go work someplace else. And I'm really thankful for that.
You know, there were times when, you know, I guess I started back at Tarlton when I was about 26 or so. And you know, maybe there were times where I thought, man, if I would have been here a little bit earlier, I would've been that much farther ahead in things. But the fact that I could bring outside experience to the company, even though it wasn't construction experience, it was just experience living in a different city, living on your own. I worked for a family business, a fifth-generation business. So I had a couple of conversations with what it was like that being a fifth-generation business, much less a third-generation business with the head of our company. And you see how people are treated differently in companies. That outside perspective makes all the difference in the world. You'd draw on it. I still draw on it. That's almost 30 years ago and I still draw on what I learned and what it's like to work in a family business, but not necessarily be a member of the family.
Eric: Yeah. So what was your mindset at that business? What was your thinking as far as, Hey, I'm gonna do this job for a couple of years, but I know I'm going back to work at Tarlton. Like was that part of your thought process or were you doing this job going, Oh, maybe I could do this as a career?
Dirk: I was gonna give it a ride and see where it went. We were in mortgage banking and so I was hired as an analyst, so I was doing a lot of project underwriting, doing appraisals for projects, doing a market analysis, doing a write up of the project. It was kind of fun because a lot of times I could get into the plans on it and maybe do a better description of the building for the lenders than they would normally get. And so I enjoyed doing all of that. But what I found as I was going through that was while we worked in a group and I had somebody that I was reporting to and doing a lot of their leg work on. It wasn't a real team environment. And I really missed that and I really, really missed the tangible nature of construction.
You know, at the end of the day or at the end of the week or the end of the project, you can walk by it and say, this is what we accomplished. And I had a little hand in that. With the mortgage banking, you know, we would place a loan on a project and usually, the funds were transferred. You never even saw the money. And so it's like, oh man, where's the, yeah, you know, the bank account looks good or whatever, but it just wasn't as satisfying. I had pretty much soaked up what I was going to learn in that role that I was in and wasn't sure I wanted to go to the next level, which was to work as a broker because there wasn't a team aspect to that. I had dinner with my dad and kind of wanted to pick his brain on what he thought from a next step standpoint because it was a little slow.
This was 1991. Construction was slow, real estate was slow, interest rates were around 11%. I was thinking he was gonna say, Hey, it might be a couple more years before we're ready for you to come back. And at that point, I was probably gonna go figure something else out. But, you know, I could see at the end of the year, this was March and I said, all I could see at the end of the year coming to work with us. And so I was like, Oh, okay. Well, that works. So I tried to soak up as much as I could from the company that I was working with, and I think I did a very good job for them, but I was ready to move on.
Eric: You were kind of in the whole savings and loan crisis era. Do you remember what you thought about the business environment at that point in time and mortgage lending? Did you learn any lessons there?
Dirk: Yeah, I mean, that was late 1980s, early 90s. Gordon Gekko and, you know, greed is good. There was a lot of that going on. I worked with some great guys, but the mortgage banking business was pretty cutthroat, pretty competitive. You know, you were always trying to line up the right clients there and get them to do their projects. And it was a pretty fast-moving time. You know, I think from our standpoint, we worked on some decent projects and we worked on some projects, like one of the folks I worked with, they weren't real sexy, but you'd look back on them now and they were just a lot of multifamily, old Chicago brownstone types of buildings, which are still there today and still being rented on a regular basis. So as long as people didn't over-finance, they did all right.
And at 11% it was kinda hard to over-finance. It was not such a great lending market. Really, the blow-up came a few years later after I was out. And the rates started coming down and lending got easier. You know, there was one project that I worked on. It was a historic building in Chicago and probably the one that I was most excited about, you know, the building was built at the turn of the century as one of the first high rises, nine stories. But it was still a high rise. It took me three, all three years my whole career there to get that finally financed. And when we did, it was a big day because it was hard and you had to put together projections and show folks how it was a good investment and all those kinds of things. And, you know, that building is still there today and it's still performing well for the owners and for the lenders. At that time, I saw so many folks make bad decisions thinking that the rates were gonna go down and they were just going up and they lost their deals because of it.
Matt: That's interesting. So you take some of that experience and then you go back to family business. Did you take a pay cut? I'm just curious, coming from investment banking.
Dirk: Yeah. That's not uncommon. I have one buddy who went back to work in his family business, like I'm working in the military and I took a pay cut to go back in the family business. But yeah, you know, you're not necessarily doing it for the big paycheck and there's other reasons why you come back.
Matt:  You felt well-equipped to offer some new experience, new insights. And then you went to work as an estimator. Do you remember kind of lessons learned from your days in estimating?
Dirk: Yeah, so my first is working in the estimating department. You know, the first thing was it goes really, really fast. You've got maybe two weeks to review a project. Maybe it's three, maybe it's a whole month, but it is a really, really fast-paced project. And you know, you're spending a lot of time on the phone trying to establish with the subcontractors, who's bidding the job, how are they looking at it? What's important to their scopes of work? You know, I think the big thing that I learned though in estimating was how resilient a good estimator is. And this still bugs me to this day where I'm on a project and you've worked really hard on this when man, you think you've got it right and then you're not successful for one reason or another, somebody is lower than you. And it's really hard for me sometimes to not get caught up in, Oh man, how do we miss this one? How do we, you know, and going back and thinking about that, whereas a really good estimator, they're like a great goaltender that lets in a goal and just shakes it off and goes back and then makes a great save.
You know, a good estimator just picks it up and goes and jumps right back into the fray. You know, nowadays, I'm a little more philosophical on the days when we miss on the hard bid because you can look at it and say, well, you know, I guess we could have looked at it a little bit differently. Maybe they had a better idea than us on this project. It just wasn't our day or something on the hard work. But when we lose on a proposal where they're making a decision on whether they like us or not on a team, then that's when I feel really bad too. Like what? Did we dress funny? You know, did I wear the wrong tie? Oh shoot, I shouldn't have said that in the interview type of thing. I think what I learned in estimating is just, you've gotta be resilient and have a good memory, but a short memory. You know, you got to just jump back into the game.
Eric: How long were you in estimating?
Dirk: I was in, off and on over probably the first seven years of my career. I started in estimating, went and worked down in Anheuser-Busch for awhile, finished up that project, worked on a couple of others, went back to estimating, was there for another year and a half or so then went back down to Anheuser- Busch for another round of projects. And kind of mixed it in through my project management and estimating career. They were kind of back and forth.
Eric: Do you remember interfacing with another manager at the company who wasn't your dad? Did you have any, like any mentors outside of your father?
Dirk: Yeah, what's fun is there are guys today that started me off down the path that had been a Tarlton a little bit longer. You know, when I was in the estimating side of things John Doerr, who's our executive vice president and has been here his whole career and he's just a couple of years older than me, was really the manager of estimating that I worked with. And then Kevin Oakley who's a project director with us, Kevin and I are about the same age. And Kevin was the guy that kind of showed me the systems and showed me how to be resilient. Both of those guys are really, really actively involved in our companies still today. And it's kinda fun to reminisce once in a while with those guys on things..
Matt: Do you have a specific moment or project or memory that sticks out?
Dirk: So the best was when we would have bid day. Everybody would come down, take the bids on the phone. It was before email. Not everybody had fax machines. And we would have lunch for everybody and bid days could be kind of stressful. And you're going through there and at the end of a bid day, we had turned in our number and John Doerr was finally ready to go have his lunch. Then safety manager came downstairs and ate the last piece of pizza that John didn't get and John just exploded. You know, it was kind of it was just the funniest thing. It wasn't funny at the time, but you know, we look back and it's like, John, we're never touching your pizza again because bid days can be stressful. And I don't even remember the project, but it was a challenging one.
You know, you're getting all these numbers in the last minute and you're trying to finalize your bid and get it to... That time we, I don't even know if we had cell phones at that point because a lot of turning in the bid was finding a pay phone nearby the office that the bid was going into and using that, tying that up, taking your roll of quarters to call in, make sure you had enough quarters to do it. And it was things that my kids couldn't even relate to today. But kind of fun. So, you know, you had all these things going in and then when somebody eats your pizza man, it's the worst.
Eric: Was there that first bid that you're the estimator, you win it and you go, oh-oh, I hope I got that right.
Dirk:  Yeah. And then I was the project engineer on it. It was we did a couple of commercial office buildings and a couple of parking garages and a local office park and I was the estimator on that. We were successful and I found out that I missed a bunch of anchor bolts in my estimate and won't ever miss the anchor bolts again type of thing. But that was kind of fun because I did have to go back and live with some of those mistakes that you make and you do learn that the estimating is not an exact science. There was an earthwork project that I took off and I double and triple checked my estimate before, during and after the project because it turned out to be a really, really sweet project for Tarlton because we had estimated a certain number of quantities and we didn't have to do as many as we had estimated.
And I don't know exactly what happened. I wasn't the project manager on the job, but when I went back and talked to the superintendent, the project manager on the job, you know, they were like, Oh, you know, it just worked out right. But, you know, every once in a while that blind squirrel finds a nut and you land a really sweet project there. And so yeah, some of those wins are awesome. This is like, we all find the great things about construction. My dad's favorite thing about construction was turning in that bid, sitting around the conference table in the client's office. Having all those bids read. And when you're read low but not too low, then it's a really good feeling. It's kinda like a poker game when you're sitting there, you've got all your competitors, you're kind of looking at 'em wondering what kind of numbers they've got. And sometimes the first number that's read is way lower than you, and you're like, ah, didn't get it this time. And then other times you know what your number is and you're sitting there and, you know, folks are close to you, but they're not quite there and then you're low. And then that's that. That's just a great feeling.
Eric: Yeah. A mistake to the high side where you still win the business. That's always a good mistake to make.
Dirk: Very rare. Very rare.
Eric: Very rare.
Dirk: And when they happen, they're fun.
Matt: Yeah. Now, let's talk a little bit about the transition, you know, for your generation. So you and your sister then enter the fold. How does that go and how do you kind of sort out roles and responsibilities?
Dirk: So we came up in the business a little bit differently. Tracy started as a project engineer, but that wasn't really her background. She's an English and communications major. And after a little bit of time as a project engineer, we developed this role that was a manager of client service and quality. And that really started her track of working in the business development side of the company. And working on our marketing materials, interfacing with clients, finding out what's important to them. And so that was always her path. And I was on the operations path. And she started about a year ahead of me, but real close about the same time.
And when we were getting close to making the transition, we had a president of the company, his name was Bob Seas [SP]. Bob was a great guy, really, really well-regarded in the industry. Just the smoothest cat you'd know. I mean, he could make a tough situation with a subcontractor or a client look so easy. Make everybody walk away feeling good about the situation. And a fantastic builder. But Bob, he had a heart issue and he had to have a triple bypass and he said, well, it should have been a quadruple. And he said, well, I'm the doctor says this is going to be good for eight years and then we'll have to figure out what's next. So four years for Tarlton, four years for me and we'll see. And so that started our transition process where Tracy and I started getting more involved in the day-to-day operations of the company, not just day-to-day operations of our projects and bids and things like that.
And so as we worked through that, we had some other folks that were involved. And when Bob retired, we had a group of five vice presidents, Tracy and myself and three others. And we had a draft. We put all of our responsibilities, all of our day-to-day responsibilities up on the board. And then at this one brief moment of time, nobody had any responsibilities. And then we started pulling them off the board. And, you know, we had our VP of finance, Dave Moore, and it's like, Dave, what makes sense for you to take back? Well, of course all the finance stuff. And he'd been working on insurance things. So he took the insurance and Tracy took some of the business development side of things and we had one of the VPs was responsible for estimating. And so he took a lot of the estimating responsibility. And then myself and another VP were doing operations. And so we, you know, we had our roles, separate roles on the operation side.
Bob retired and my dad took the role of president back for a year while we were operating under this. And then at that point, Tracy and I were going to elevate ourselves to the day-to-day operations of the business. We came to the conclusion that we were gonna be co-presidents. That was very popular at the time. Several companies that we knew of were doing that. And we always knew how we were gonna work together. And what we were going to do. Just the hard part was figuring out what we were going to call ourselves.. That was a really difficult role for my dad. You know, he didn't wanna have to make a decision, one child over the other as far as who was going to be president.
And so we Tracy and I basically said, Hey, we'll do that. So we came back and we have an outside board of advisors in our company. They were helping us with the transition at the time. Their response was, oh, co-presidents don't do that. That's gonna be very confusing internally and externally, you know, go back and think about what your roles are going to be and who needs which title. So we went back and we meet every three months. We came back three months later and it made sense with Tracy doing the external work to be president because when she's out selling the company, everybody wants to talk to the president of the organization. And I'm leading the internal charge of things, so chief operating officer made sense for me. And so that's how we got to that point. And it's worked pretty well since.
Matt: Just as far as roles and responsibilities that went up on the board, who got ordering enough pizza for bid day?
Dirk: I think that would have been the guy in charge of estimating.
Eric: Estimating, there you go.
Dirk: Yeah, exactly.
Eric: Yeah. That's great. So yeah, I feel like that's another interesting common thread that you run into is this dynamic of maybe two family members and the roles and responsibilities being different, but then having to kind of like most accurately communicate what that means to inside and outside people. And yeah, it's tricky. There's no perfect solutions to it. And it probably is dependent on, you know, unique personalities of the people who are in those roles. Are there any downsides to splitting it up, CEO, COO?
Dirk: So Tracy and I have very complimentary personalities and at their best, they work really, really well together. As one of our advisors kind of describe it, you know, she's ready, fire, aim, and I'm more ready, aim, aim one more time, aim, then fire. She's ready to go do things, and I'm like, wait a minute, let's think about this a little differently before we reach a conclusion on this. And when we're clicking, that works really, really well. You know, the downside in the family business is that we've known each other our whole lives. And so some of those little things that you would put up with it with a colleague that you haven't known your whole life. I do things that just drive my sister crazy. It's like, I'll come on, you know, where are you on this? Make a decision. I was like, well, I'm still looking at it, still trying to figure out what's the right angle, you know, if you look at it this way, it's this way. If you look at it this way, it's another way. And so that'll drive her crazy. And then sometimes she'll make a decision real quick. And I'm like, ''How could you make that decision? You haven't even looked at the different aspects of it.'' So, you know, those are the, that's kind of the downside where you know, when you know folks your whole life, you sometimes have a shorter fuse but you have to work at it. And the two of us work really, really closely at working together. It's just so much fun when it works together when it works well. Yeah.
Matt: Do you guys seek any outside advisory?
Dirk: Yeah.
Matt: Do you try to formalize that?
Dirk: Yeah. I mentioned this advisory board. We have a three-person board of advisors that we meet with quarterly and that's typically an individual from the construction industry outside of St. Louis. And then two folks that are local business folks in St. Louis. And we've been doing this for almost 25 years. They were instrumental in our transition and we really use them as an accountability board, a forest through the trees. We rotate a new one on every year. We try to find an individual that maybe has a unique set of talents for our current needs. For example, the individual that we just rolled onto the board is really big on lean manufacturing processes and we're on our lean journey within our company. So trying to draw from him some of his experiences is really important. You know, when we were doing our transition, we'd looked at folks that had gone through transitions in their own companies so they could bring some of that experience.
And then we also use some outside executive coaches. And you know, there's a firm here, CMA that we've been working with for, I don't know, five, six, seven, maybe as many as 10 years. Just to kind of help us through, you know, all sorts of different industrial psychology types of things. You know, they do some one-on-one work with Tracy and I, and then they also help us on our pre-employment screening and they've helped us with some strategic planning. So they were a really, really important component of our company.
Eric: Yeah, that's great. I think we heard in another podcast that you had done, that you did a family business forum at the St. Louis University, and I think you mentioned that that one had been really helpful. What about that was really helpful?
Dirk: Well, at the time, we were with a whole bunch of other companies that were going through similar transitions. And the Family Farm Forum was sponsored by St. Louis University and headed up by a husband and wife team Bob and Joyce Brockhouse. And they were really, really good at explaining the emotional sides of the transition process. You know, that's a big thing that is overlooked a lot of times. You know, and I saw it in my parents. The management transition was pretty easy because my dad had had folks kind of running day-to-day operations. He had been the chairman for a long time. Bob Seas had been president. That was pretty easy for him. But when we made the ownership transition, that was a little more difficult.
The owner of Tarlton Corporation and, you know, my parents worked as a husband and wife team on that front, that was a big identifier. And kind of what does life look like afterwards and how do we communicate? Because my dad didn't wanna be involved in the day to day stuff, but he's still wanting to know what was going on. There was maybe a year or so of figuring out how that communication process was going to happen. Then we got through it. And the family farm forum helped us understand that those are gonna be issues going forward. That was really, really important.
Eric: What do you think was the biggest thing that helped you get through that learning communication process with your dad?
Dirk: Just talking. I think my mom probably whispered in my ear that boy, your dad would like to have a little more information on what's going on. But he was really trying to be respectful and not put his nose into things that we were already working on. I mean, I applaud him for that, but having that reminder to say, Hey, don't forget, go up to his office and sit down and say, Hey, did you hear about this one today? It's important. That was really how we got through it. I think it was that nudge from my mom that started it.
Matt: Interesting. Very cool. If somebody wants to work their way up to upper management in construction, how should they focus their time and energy early in their career?
Dirk: Well, the thing I'm telling kids right now, the younger folks and what we're working on is try to get a well-rounded base. You know, it's just, it's like sports, you know. You can't play when your feet are crossed, right. You know, solid, wide base, low center of gravity. Understand as much about the business as you can. You might not like estimating, but if you know how it works, it'll make you a better project manager. You know, you might love dirty, nasty sewer types of projects, but if you're on an office project, you know, that's maybe not that way, embrace it. Because you're gonna learn different components of the construction process, and you'll meet different subcontractors and you'll meet different kinds of owners and it'll make you better at what you do because it's a cyclical business. And the more multidimensional you can be, the better you're going to be at weathering the downturn. You know, the more valuable you are to your company.
If you're single-dimensional it's going to be hard sometimes. If all you know is one type of construction you're not gonna...and that work dries up and you're not interested, not willing, not able to jump over to another aspect of the business, you're gonna have a hard time sticking. And you know, as you go further in your career, you'll draw on those experiences from back in the day which we always do. And you'll be able to create some empathy for the other folks in your company, whatever they're doing. You know, if you understand what the estimators are going through on a project or if you're an estimator and you know what the project managers, what it's actually like in the field and why it costs a little bit more or why you don't have to figure things, you know, the way you've been doing it your whole life because things have changed in the field, it makes a big difference.
You know, I think the other thing that I mentioned, empathy and it really is understanding the other side. Trying to figure out what makes, you know, what makes a subcontractor successful on a project. You know, we're general contractors. We work with on a big project. We might have 30 subcontractors and suppliers on that job and each one of those entities needs to be successful. Now, not at the expense of the whole project and at the expense of the other teammates, but we've all been on projects where one entity kind of holds back everybody else on the project and makes it hard to win as a team because they just can't get their act together. So, you know, understanding what each of those scopes needs to be successful it will go a long way to making your job a lot easier in the future.
Matt: Yeah. That's good. Real quick, back to the family business thing real quick. Do you have any good stories about when you and Tracy just clicked on something and you did something amazing and the only reason you were able to do that is because you were siblings?
Dirk: I think really when it's clicked is because we're so woven in St. Louis, and not from a big picture, but this is home. We take St. Louis personally. And so we've been fortunate to be involved in a lot of our kind of civic institutions and it's really fun when, you know, and I'll give Tracy a lot of credit, but I do think that it's just the fact that, you know, we've created this environment within Tarlton. We had a client that came to us and said, ''You guys are the ones that we want to do this project. We trust you. We've gotta get this done, short amount of time and we don't trust anybody else. We need you guys to do it.'' And it's like, man, you know, that's where it all comes together. That's where, you know, the outreach that we do within the community, where the setting the tone within the company all comes together.
And, you know, I'm sure other companies could say, Oh well, you know, we do the same thing. We've had clients do that. But it really was a culmination of all of the cultural things that we try to put into our company externally and internally. And, you know, we had folks that were working on that project that had been working with that client for a dozen years and this was the client's biggest project that they'd done since they'd built their facility. So that was a blast. And that was just a couple of years ago. And that's when you see everything coming together.
Matt: Yeah. Well, we have a handful of kind of rapid-fire questions. Just quick one answer. So how many hours a night do you sleep?
Dirk: You know what? I've found that sleep is becoming more important as I've gotten older. So during the week, I'm usually looking at what do I do? The alarm clock's going off at about 5:20. And I'm usually turning the light off at 10:30. So what's that? That's about seven hours. And during the weekend I try to get that up to 8:00, but yeah, sleep is so important for everything we do. There's a lot of great podcasts on that if you're looking for one.
Matt: Yeah. Yeah. You list endurance athletics as like one of your hobbies and interests. What's the routine?
Dirk: The annual routine is winter to early spring is hitting the weight room, outside running, maybe a little mountain biking. And then in the summer time, spring and summertime, I really start to focus on training for triathlons. Whether I do a triathlon or not, every year that remains to be seen. I only had time for one and this year I was signed up for it and it got rained out. So this year I didn't get one in. But then in the summertime I'll start swimming, running and riding and an awful lot. And then in the fall kind of kicks up a couple of long charity fundraising type of rides. You know, a couple of centuries things like that. And then late fall, early winter, we'll be trail running and you know, I've got an adventure race coming up in a month.
Eric: Okay. What's that?
Dirk: Well, that's a blast. Four-person team. We draw folks from the company and they don't tell you what the course is. Just be prepared for 5 to 10 miles of trail running orienteering 15 to 20, miles about mountain biking and about five miles of paddling a canoe. And they give you maps and sometimes they give you points on the map and you gotta go find them. Sometimes they just give you coordinates and then you've gotta plot that on the map and then go find it. And it's strung out between about a half dozen parks outside of St. Louis. And it's called an 8-hour race because you usually start at about 7 o'clock in the morning and finish anywhere from noon to 3 o'clock in the afternoon after hitting all 25 to 50 points. It's a blast. I love the teamwork aspect of it. We've put together a team of folks from Tarlton and y'all have to stay within a hundred feet of each other at all times. And this will probably be our 10th year doing in a couple of weeks.
Eric: Yeah. Oh, that's awesome. What's your favorite tri-event?
Dirk: I've never done anything longer than an Olympic distance and really that's just been a function of time. I don't know if I'll ever get to a full Ironman. Half is pretty doable, but that Olympic distance is fun. I've done you know, the swimming for me is the best segment. And I end up doing really well on the swim in my age group and then hold my own on the bike and then kind of losing it on the run. But yeah, lately, you know, I haven't had a chance. I've done a few long-distance swims, like 10K swims, which once I'm finished with my Agency of America duties, I'm gonna go train for one of those and do another one of those.
Matt: Why is swim your strength? Were you a swimmer?
Dirk: Yeah, I grew up doing that until I was about 13 and then I switched over to football and basketball. After a certain period, you're not playing football anymore. Swimming is much better on your body than that. So I just got back into it after I graduated from college and liked the workout and then actually will swim pretty regularly, did a triathlon as a relay and said, well, I can do the whole thing. And that's how I got into the triathlon deal.
Eric: That's cool. If you got the chance, would you go try and do the Kona race?
Dirk: You know, I have ridden that bike ride and it's pretty brutal. It's totally exposed. Yeah, you gotta qualify. And I figure if I keep on doing this that, you know, kind of the attrition in the number of...at the age groups. I'm finding fewer and fewer people are in my age group as I keep on going. So I might have a chance when I'm 70.
Eric: Yeah, right. I don't know. You watch the specials and there's always some 90-year-old dude out there doing the Kona race.
Dirk: Oh God. And doesn't Al Trautwig like make you wanna cry the whole time? I mean that's like, Oh, but yeah, coming in in the dark and doing all that kind of stuff, that might be me. That's my goal. I would totally love to do that. I've never done a full marathon. I gotta work my way up to that. And that might be on the bucket list for next year to find one to do.
Matt: Yeah. Yeah. Very cool. So what's the best book you've ever read?
Dirk: Oh, man. Maybe the one, it was about Vince Lombardi and what's called ''When Pride Mattered.'' It was all about him and his legacy, how he started in coaching, how he grew up, how he started in coaching, what kind of coaching tree followed him. And I don't know you know, if you follow football. You know, a lot of times you'll find a head coach, he'll say his coaching tree and who did that guy work for? And who's working for him and where are they now? But I really, really loved kind of the...they had a couple of quotes in there, but you know, he's like you, we're gonna, you know, the goal was perfection and hopefully along the way, we might not reach perfection, but hopefully along the way, we'll reach excellence. And, you know, I think if I look at what's my why in working in construction and working at Tarlton is I really want us to focus in and be the best builder we can be. And, you know, that operational excellence, it can be defined in a lot of different ways. But if we concentrate on being the best builders we can be, then you know what, we're gonna be successful.
Eric: That's cool. All right, What's your favorite restaurant in St. Louis?
Dirk: Oh, man. There are so many good ones here. You know, lately I've been traveling around so I haven't had a chance to get to a lot of places. Mission Taco Joint is always a fun place to go because it's pretty quick and easy and good food. The Atomic Cowboy is just a bar-restaurant type place in our neighborhood that I like to hang out at once in a while. We've got great pizza and I, you know, can't really single out one, Katie's Pizzas is always really good. You know, like pizza is the one thing that if I was on the desert Island and you told me I can only eat one thing, man, that's what I'm going for. Yeah.
Matt:  Good. What's the first website you check every day?
Dirk: First website I check every day. Usually, it's the "Wall Street Journal." I get a, you know, get a little update on what's going on in my email feed and then I'll jump on that. I still get a paper copy back in the office, but I kind of use that as where should I go and look in the paper copy.
Matt: Okay. You mentioned when you're done with your AGC duties. So let's talk about the AGC a little bit. How did you first get involved with the AGC?
Dirk: I don't know if it was on purpose or by accident, but that was an integral part of our succession planning.
Eric: Really?
Dirk: Yeah. We had gone to the convention as kids that, you know, hanging out with our parents while they were, my dad was doing stuff. But when I started in the company my dad kinda said, Hey, you know, you wanna go to the convention? I was like, yeah, that'd be great. Go to Las Vegas was the first one. I was like, okay, well, this isn't playtime though. You gotta go sit in on meetings and, you know, soak up as much as you can. Tracy and I were there together and we went to a million different things. You know, the one that stands out was, I just sort of wandered into this meeting and it was all about asphalt futures in how you can hedge your bets on buying futures.
And I had no idea that that was part of the construction industry at all. I had learned about futures in my education, but didn't really put all those things together. So over time, a couple of, maybe a year later and I was like, Hey, do you wanna go back? And it's like, yeah, well you gotta get involved in some committees. And so we sat down and looked at the list and I found one that was on closely held business that I got involved with and another one on project delivery, which really was at that time studying how, you know, what are the differences between construction management, construction management at-risk, design-build, lumpsum design bid build. Because really the industry was focused on the design, bid, build mode, but new delivery systems were coming in. And so those were two things that I just got involved with and really, really helped me understand how to run a construction company. You know, I kinda call AGC the University of Construction because it's where you go to learn how to run a business.
Matt: Yeah. So let's talk about that a little bit more. How has involvement in the AGC really benefited Tarlton?
Dirk: Well, to quantify that is almost impossible. We've certainly through our AGC relationships, we've had numerous joint ventures. So you can put a dollar on what we've earned on projects that we've pursued and been successful on with our joint venture partners. And those fees that we've earned have paid for every single dues bill or you know, investment-in-attending meetings. You know, we've been very successful from a financial standpoint on that. But, you know, I look at AGC and I've used this term, but it's where you'd look to see around corners. You know, I've come back from a conference and feel like, man, we are so far behind. I'm talking to folks and they're doing this, this, this and this and we're not even there yet. And folks will be kind of like, okay, yeah, you were in another conference. This is not good.
Then I realized a few years ago, I was really comparing myself to the one percenters of the industry. And if I could just keep us in the top 5% on an issue, then I think we're doing pretty well. As I describe to the people in our company when I'm doing orientations, why the industry involvement? Why are we used to heavily involved as we are? Well, you know, project engineers gotta stay out in front of the superintendent a couple of months, getting everything ready and the superintendent's out ahead of the guys in the, you know, in the trenches a few weeks and making sure that they're doing what they're doing. The managers ahead of the project engineer setting up the project a few months, us and back in the office have to be in front of those folks, you know, a year or two. What's coming down the road, you know, what are the regulations that we gotta be, what are the new tools that we gotta be looking at. And AGC is where I get a lot of that information.
Eric: Huh. So, and you're the current president of the AGC. What do you think have been some of your highlights over the last several years?
Dirk: The number one highlight was the conversation I had with my predecessor Eddie Stewart. And he's like, boy. And I was fairly early in my term and he's like, you know, the one thing that Eddie saw and I agreed with was how nice and friendly and open everybody is that we've met along the way. And you know, we started riffing on that topic and I was like, man, you know, if you think about it, we all joined the association for a specific reason. We wanna help with our safety program or we wanna be involved in advocacy, legislative matters in our state or on a national level or, you know, maybe we're entering an insurance program or something, all that.
But we stay and we get active because we've found value and we wanna make a difference in our industry. We wanna give something back. You know, I've always had this transitive property of friends where, you know, if I like Eric and Eric likes Matt then probably I'm gonna like Matt too. And so, you know, this whole hanging out with people that are all involved in wanting to make a difference in and improve our construction industry, I mean, those are the people that I want to hang out with. So it just makes sense that, you know, wherever you go, you're meeting great people that are interested in being successful in their own firms, but also helping others be successful. And so, man, you know, these great people that you meet everywhere. And I've been fortunate enough to go from cover Hawaii, Alaska, Puerto Rico, you know, the Northeast, Southwest, you know, everywhere I've gone, people have been open, accommodating and sharing ideas and helping me out along the way. It's really been humbling.
Construction is such a wonderful industry, you know, it is. There are so many fun things that I love about it. We're in the midst of a workforce crisis that we keep on working on, you know, as an association, whether it's on a national level or a local chapter level or within our own companies. And I don't get that. I don't get the fact that some people don't think construction is a real viable industry that it's not glamorous because man, there's nothing cooler than showing your kids what you worked on. Sharing the war stories with the folks that, you know, you went through this tough project.
You know, one of my favorite stories on that was, you know, we had a really, really deep sewer structure that we had to get to the bottom and it was close to the Mississippi River. So the water kept on coming in. It was a mess. And you know, some people have topping out parties. We had a bottoming out party and it was just a celebration that man, we finally got to the end of this challenge. And there are guys that worked on that project, they are still here today. This was probably 20 years ago. And, you know, we still talk about it. And that whole fraternity of construction you know, you're on that tough project, that's cool. You find these bonds in a lot of different ways. And those are just a few of the fun things about construction.
Matt: Yeah. It's interesting that it's hard to communicate that sometimes to kids that are still in college, right? You know, it's one of those things that until you experience it, it's really hard to communicate. They're looking at a job fair and they're looking at finance or investment and that's kind of the, that's the interesting thing that everybody thinks they wanna go get involved in. I don't understand what's involved in construction.
Dirk: Yeah. Yeah. And, you know, I've got a buddy, he's down in Texas and his kids are young and he's like, I go to every single parent's day that I can, you know, where they're asking the parents to come in and talk about construction. He says, you know, high school kids think the computer programmer, finance guy is really cool, but you should see what those first and second and third graders look like when I'm talking about construction. He's like, man, I got them. I got them at that age. That's the golden age for us. And, you know, the hard part is keeping them, but you know, we do some fun things that everybody, I don't know, you know, I think everybody will look at and say, wow, that's really cool. How'd they figure that out?
And the only other place I've feel like I got that same rush of teamwork and adrenaline when you're doing something, it's you know, when you're playing on a team. When you're playing football or basketball or, you know, you're on a swim team or something like that, where, you know, you're all working together, everybody's got their specific role and it works and it clicks, and there's nothing better.