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Creating connections is essential to building a community. It’s even more important when the people you’re trying to connect with aren’t in the same location. Businesses and companies have always found geographic distance to be a challenge to building a really great community-oriented culture. At Empowered Ventures, the same challenge holds true, which is why we decided to start Empowered Owners, the podcast that takes you inside Empowered Ventures.
In each episode, CEO Chris Fredericks will have a discussion with one of our employees to discover and highlight their distinct personalities, perspectives, and skills while also keeping you in the loop with exclusive news, updates on company performance, and a glimpse into the future plans of Empowered Ventures. Not only is this an opportunity for Chris to learn more about our amazing employee-owners, but it’s also an opportunity for you to hear regularly from Chris and others from within Empowered Ventures.
00:00:00:11 - 00:00:22:24
Casey Grisez
Hello everybody, and welcome to another episode of Empowered Owners, the community Building Podcast by and for the employee owners of Empowered Ventures. Join us as we take you inside the world of employee ownership, discovering the stories, insights, and sometimes surprising adventures in a family of businesses where everyone's an owner. Now let's dive in. I'm excited.
00:00:22:24 - 00:00:46:06
Chris Fredericks
To be joined again by Luke Orszag, president of Firstar. Firstar is one of Empowered Ventures operating companies, and actually was EV's first diversifying acquisition back in 2021. So we are very recently kind of celebrating Firstar's fifth full year as part of Empowered Ventures. Luke, thanks for coming back on the show. Yeah. Thanks, Chris. Happy to be here.
00:00:46:08 - 00:01:03:21
Chris Fredericks
Yeah. So I thought we could just do a bit of a recap of the we're right in the middle of kind of wrapping up our fiscal year as an enterprise. And so it's kind of good timing to look back and talk about the past year. What highlights for you stand out as far as the year first are just just wrapped up?
00:01:04:01 - 00:01:34:03
Luke Orszag
Sure. Yeah. I think when I look back at this past fiscal year, it's almost a tale of two halves. So the first half of the year, we saw demand almost go away entirely. I mean, obviously still some things there. But then the second half almost to the date really took off. It was actually kind of surprising, given the way everything was going with the economy at the time and kind of the uneasiness that everyone was feeling at the time.
00:01:34:05 - 00:01:55:15
Luke Orszag
You know, tariffs started kicking in. That was, you know, led to some uneasiness. And once we got into September, we immediately had to start hiring. I mean, it was it was pretty remarkable how quickly it took off. And we're still digging out of it to a certain extent. So, yeah, I mean, as far as the year ended up so versus budget, we did okay.
00:01:55:16 - 00:02:11:17
Luke Orszag
You know, not where we wanted to be. We it was a pretty big hole to dig out of. I guess probably a fair way of saying in the first half of the year. So to finish where we did, very happy with the effort of the employees, everybody just kind of pulling together to get as much as we could out the door.
00:02:11:18 - 00:02:29:24
Chris Fredericks
Yeah, that's quite a that's a tough experience to go through the first half of the year, you know, really slow all the uncertainty, as you mentioned, kind of in the middle of 2025. And then for it to pivot so hard and so quickly right in the middle of the year. And now you're feeling behind and hiring and everybody's rushing.
00:02:30:00 - 00:02:34:08
Chris Fredericks
I mean, how did the team respond to that pivot in the middle of the year?
00:02:34:10 - 00:02:54:13
Luke Orszag
Really? Well, I mean, there was certainly an appetite as as we were slowing down. It's probably no surprise in this industry that machinists like overtime and generally there's not necessarily an expectation for it, but they like working overtime and they like having the opportunities to work overtime. So it was really tough in the first half of the year not having those type of opportunities.
00:02:54:13 - 00:03:12:02
Luke Orszag
And so there was an appetite that when things moved quickly and we asked people that we need some more hours, everyone stepped up and it was like I said, you know, that last six months, as people were working at overtime and just putting forth that extra effort, some guys running two machines, or typically they might only be running one.
00:03:12:05 - 00:03:16:20
Luke Orszag
All of those different elements added up. So the team responded, well, I'm really proud of them.
00:03:16:24 - 00:03:26:09
Chris Fredericks
That's awesome. What else? Kind of stands out to you as highlights? Like anything, any particular initiatives or anything that Firstar worked on last year that you know or noteworthy?
00:03:26:11 - 00:03:47:16
Luke Orszag
Yeah, a couple big things. So the primary one I would say is we've started looking more closely at the industries that we're in and our penetration into some of the industries. And so one of the areas we thought was we had almost no defense work. And part of that is just the certification. So you need certain certifications to be able to work on certain parts.
00:03:47:16 - 00:04:17:01
Luke Orszag
There's the defense industry in general is an area where it's very regulated. You need to have certain things in place that protect information. And so there is a certification called the JCP, which is now becoming CMC. That's an area that we didn't have. And so we looked into what that could mean for us. We happen to have a potential customer that was kind of advising us if you were able to achieve this, there's some business here.
00:04:17:01 - 00:04:34:12
Luke Orszag
And so that was enough incentive for us to pursue it and see where it could lead. And so that was a big push to get that going. It helps to that we were a little slower at the time. So we had some more bandwidth to be able to work on that stuff. And then of course, as it always happens, as soon as we get to certification, we start getting that business.
00:04:34:12 - 00:04:40:08
Luke Orszag
Everything else turns up. And so, you know, but that's a good place to be in. Yeah. What was.
00:04:40:08 - 00:04:47:08
Chris Fredericks
That experience like getting that certification? Was it what you expected it to be? Was it harder or easier? Like yeah, much.
00:04:47:09 - 00:05:07:10
Luke Orszag
Much more difficult. Yeah. Of course. Yeah. So there's there's two elements. There's kind of a self-certification where you say, oh yeah, we do this, we do this. And so you kind of meet those controls or the elements of the certification. And then the second part of it is you actually have an auditor come in to verify those things.
00:05:07:11 - 00:05:35:19
Luke Orszag
And what we found is that although we're doing all of the things that we should be doing the documentation for, it is something that we needed to to work more on. And so we're still actually kind of going through that right now to finish the CMC certification. That documentation is is no joke. It's it's a lot. And I can see why a lot of machine shops are just contract manufacturers in general.
00:05:35:23 - 00:05:45:00
Luke Orszag
Wouldn't want to go through it. It's a it's a full court press to get it done. And like I said, we're still kind of ironing out some of the wrinkles of it now.
00:05:45:03 - 00:05:49:05
Chris Fredericks
Yeah. But it did open up some opportunities for you it sounds like.
00:05:49:07 - 00:06:03:11
Luke Orszag
Yeah, absolutely. One particular customer that will end up being one of our largest customers at this point and 100% defense work. There's no commercial work associated with them. So yeah, we needed that certification to be able to open that up.
00:06:03:12 - 00:06:10:06
Chris Fredericks
Wow. Congrats. That's amazing. What else did you work on this past year worth highlighting from an initiatives perspective?
00:06:10:07 - 00:06:36:04
Luke Orszag
Yeah, another big one. So along with kind of looking at the different markets that we're in and you know, maybe certifications was the path for the defense. We also just wanted to see just organic growth or you know, kind of the demand side. So we started working with somebody on our marketing specifically. And we've done different flavors of us in the past, and we haven't done just a pure marketing element yet.
00:06:36:04 - 00:06:53:24
Luke Orszag
So we started that. We found someone who like to work with. She had some really good thoughts for how we can position Firstar in the marketplace just to drive awareness of Firstart. And so we've started laying that groundwork, and we're starting to see some of the fruits of that labor. Now it's it's a long time period.
00:06:53:24 - 00:07:07:22
Luke Orszag
And we knew that going into it that we're not going to start this. And then all of a sudden we're going to be inundated with all this work. We knew that there's a time frame to it. And so we're starting to see some of that now. And it's been about a year since that started.
00:07:07:24 - 00:07:27:24
Chris Fredericks
What I think people hear marketing and they think, you know, advertising in a, you know, in on TV advertising in the newspaper. I'm really showing my age, you know, advertising in general. A lot of people think marketing is just advertising. Like, is that what this is, or is there something more to it than that?
00:07:28:04 - 00:07:54:17
Luke Orszag
Now, what it really means to us is helping drive awareness. So it's not necessarily that, you know, traditional and you have a product and you advertise it on the ad and hey, look how great our product is. We wanted to Firstar with showing that Firstar is knowledgeable about the industry we're in. We're a place that's somewhere someone can go to to get answers to solve their issues.
00:07:54:22 - 00:08:21:23
Luke Orszag
And so that was the first thing is starting to build up the credibility. And so we created a lot of content around first our capabilities to to help with that awareness, but then also pivoting to more of just knowledge sharing and just content creation that way. And then we looked at the industries that were in industries we wanted to be in, and we looked specifically at certain companies that we thought might make sense for Firstar.
00:08:21:23 - 00:08:48:09
Luke Orszag
And so we started to craft some of our content around those customers and then position it to them directly in a more traditional ad sense, I suppose, so that you have that messaging of the credibility and the knowledge sharing, so that when people see and ad from Firstar, it's, hey, these guys know what they're talking about, I'm going to reach out to them and just see where it could lead to.
00:08:48:11 - 00:09:14:03
Chris Fredericks
But it sounds like it's more strategic rather than general. So you're you're kind of crafting your you're positioning your story, you're highlighting your, your expertise. And then taking it a step further, I think on LinkedIn, mostly, if I'm if I remember correctly and delivering it to directly to actual targets, not of customers you think would really benefit from working with Firstar.
00:09:14:04 - 00:09:15:17
Chris Fredericks
Is that really what you're.
00:09:15:22 - 00:09:37:02
Luke Orszag
Yeah, yeah. And what we found to is, you know, we created a scoring system for okay, here's the markets we want to be in. Here's the customers we think might make sense in those markets. And then we identified, okay, these are the position titles at those customers that we think makes sense. And so again that that content was crafted towards that position.
00:09:37:02 - 00:09:42:22
Luke Orszag
But yeah very targeted very strategic. Not just general advertising.
00:09:42:23 - 00:09:54:08
Chris Fredericks
Yeah. And I would imagine that will take time to play out. Like the benefits of that are not just immediate, but how do you feel about the the first year or so of, of that effort.
00:09:54:10 - 00:10:21:12
Luke Orszag
Really good. So right out of the gate we saw very high engagement from customers that we were looking for. Interesting. And then as we added the defense certification, we started adding those customers into the mix and we started seeing even more engagement. Typically they might just be larger companies. So that's part of it. But one company in particular, in the space industry, we found that has been very engaged with our content.
00:10:21:12 - 00:10:33:19
Luke Orszag
And recently we've started to see more traction with them that again, you never know what it's going to go, but that's not a customer. That Firstar would have been on their radar at all before that point.
00:10:33:20 - 00:11:00:09
Chris Fredericks
Interesting. Do you think and I'm imagining in the industry, especially in the industry, in your customer industries that have the certifications and the, you know, those types of hoops that have to get kind of jumped through the business can get pretty sticky. Once a once a company has earned a particular, you know, product that it can be hard to switch or, you know, a company may choose not to switch because it's too much of a hassle unless they have to.
00:11:00:10 - 00:11:24:22
Chris Fredericks
So I guess what what ultimately do you think drives the opportunities more? Is it switching of things and kind of cost, you know, looking for better cost, or do you think more opportunity will come from companies that are maybe doing something new, like they're building a new product and they want to diversify their supply chain or find someone that you know, fits a new product that they're working on.
00:11:24:23 - 00:11:46:00
Luke Orszag
Sure. Yeah. For us, we look at it as barriers to entry. We don't want to compete with the machine shop down the street. We want to position ourselves as experts, as partners for our customers, that they know that we're going to be here for them, and we're going to help them solve issues and help them move their own mission forward, whatever that may be.
00:11:46:04 - 00:12:08:03
Luke Orszag
So when we have a potential customer that seems very focused on price, it's typically not a customer that's going to work well for Firstar because we're not building that partnership. They're only looking at that cost per unit, and we're not helping them solve issues. We're not we're not helping them move their mission forward, just helping them solve one specific problem for cost.
00:12:08:05 - 00:12:20:18
Luke Orszag
We're obviously there's different things we can do with that to help them with that, but that's not what we're targeting. We're helping companies move things forward, and we're not trying to do that through costs the best.
00:12:20:20 - 00:12:33:13
Chris Fredericks
So that could be an existing product line for them that someone else is doing the work, but they're probably experiencing some challenge with that. If they're open to they want some help to figure out something that's not working is what I'm hearing.
00:12:33:14 - 00:12:58:16
Luke Orszag
Yeah. And it could come in a couple of different forms. Most typically for us is we'll have a customer come to us and say, hey, I cannot find a supplier for this. Something unique about the part, the material, the geometry, tolerances, whatever it might be. But they're having an issue finding a supplier for it. So that's typically our entry point is we can come in and help them, you know, kind of remove that thorn in their side to start.
00:12:58:17 - 00:13:17:21
Luke Orszag
And then from there that you have some credibility. And so you ask what else could be out there. And sometimes they'll they'll offer it up as, hey, you guys did really great with this. You know, here's another one that, you know, it's not as big of an issue, but we could use some help with the environment. We're in two right now in some cases is we times.
00:13:18:02 - 00:13:46:01
Luke Orszag
So there's some vendors that you know, they're turning away work because their shop is full. And so we're finding customers that are looking to look for extra capacity basically. And so you know, the foot in the door in that case is it could be an existing product. You're helping reduce their lead time. But again building that credibility is we should be able to then stick with that customer that as that expands or even you have some sharing of work at that point.
00:13:46:02 - 00:14:05:12
Chris Fredericks
So yeah, that makes a lot of sense. So but it's I imagine if I'm that company looking for some a machine shop that has capacity, combining the capacity with the technical prowess that is necessary to achieve difficult to produce parts, that's really where Firstar shines, right?
00:14:05:13 - 00:14:06:11
Luke Orszag
That's the niche.
00:14:06:14 - 00:14:16:24
Chris Fredericks
Yeah. Yeah. Great. Looking back, what do you what do you feel most proud of in the past year that Firstar has achieved or you know, what would you celebrate for the year?
00:14:17:01 - 00:14:40:03
Luke Orszag
Sure. I think for us the first thing really is again, tale of two halves. The way the Firstar employee owners kind of turned up their effort. And that second half because they saw it, they saw we share every month the workload and how many weeks of machine time and that sort of thing. So we were making them aware and, you know, asking for more hours.
00:14:40:03 - 00:15:02:18
Luke Orszag
We never had to dictate overtime. Everybody stepped up where they needed to. And then adding employees to help keep up with the demand, the existing first, our employee's very willing to train, very willing to help out because they know at the end of the day that's going to help them too. So really, just the the attitude and the effort of the Firstar employee owners really stood out to me this past year, more than any year previous.
00:15:02:19 - 00:15:15:24
Chris Fredericks
Wow. That's awesome. That's awesome. What about looking forward? What this coming year we're in 2026. Our fiscal year is just begun. So over the next 12 months or so, like, what are you what are you excited about?
00:15:16:01 - 00:15:43:07
Luke Orszag
So first it's finishing the CMC certification. It's that like I said it is not easy. But yeah. So we're anticipating to finish that sometime before the end of June at this point. So put that behind us. And that'll be kind of a feather in the cap so to speak. After that it's really starting to just see where that goes in terms of marketing that looking for more customers.
00:15:43:09 - 00:16:08:03
Luke Orszag
One of the other areas to is looking at employee development. That's something we want to focus a little bit more on this coming year is, you know, the machining workforce is not getting younger. There is a workforce shortage already, and it's already going to and it's going to get worse before everyone realizes. So one of the things we've we've started to do already is internal development of employees.
00:16:08:03 - 00:16:26:17
Luke Orszag
But then starting to look at, okay. How can we set up a system where if we're bringing in someone off the street, we could quickly get that more quickly, get them up to speed for what we would need, and then give them a path forward. That is, they see this. This isn't just a job for you. This is this could be a career.
00:16:26:19 - 00:16:30:24
Luke Orszag
And so that's going to be an area that we're going to focus on this next year.
00:16:31:00 - 00:16:37:02
Chris Fredericks
That sounds awesome. This has been great Luke. Appreciate your time. And thanks for coming back on Empowered Owners.
00:16:37:04 - 00:16:38:08
Luke Orszag
Yeah. Thanks, Chris.