HVAC Companies Work Together

Today I learned there's an organization called Nexstar Network. It's a shared services group for independent HVAC companies in the U.S, Canada, and Australia, training people in the businesses in everything from customer service and marketing to technical aspects of the work. It's been around since 2000, and is funded by its members' dues. 

A Star Tribune story (gift link) led me to this because the Network has faced the challenge of whether to include HVAC companies that are being bought up by private equity companies: a trend that affects many different kinds of companies these days. (I remember hearing that funeral homes, which have traditionally been "mom and pop" operations are now mostly owned by private equity, for instance.) 

The lead in to the Strib story is about a 55-year-old local contracting company that just suddenly declared bankruptcy, driven to it by its private equity owners, who purchased it in 2022. 

Up until this year, Nexstar Network had been including private equity-owned HVAC companies, likely because they were already members whose companies sold out to private equity. Those companies made up about a third of the Network's members, so considering whether to bar them from membership was a serious decision. But the decision was made.

As the Strib article says, dumping private equity members seems like the obvious choice:

...a breakup with private-equity backed contractors was inevitable because Nexstar is designed to help create the innovations and training the well-heeled investors claim to bring.

"Nexstar gathers information from the whole membership... They figure out what's working across the country, then help consolidate those ideas and teach us about them and help us solve problems."

All without imposing a debt burden.

It's almost a co-op model, without that legal structure. (Not unlike the hardware store model, without the "virtual chain" branding.) Self-help and mutual aid, on a small business level. No private equity millionaires and billionaires welcome.