Master Service Companies owner Josh Smith has sold his company and will use the profits to create a foundation that will fund criminal justice reform initiatives.
The Knoxville-based residential waterproofing and foundation services company sold for an undisclosed amount to Larry Janesky of Connecticut-based Contractor Nation, formerly known as Basement Systems, Inc.
The deal was put together in just four weeks, Smith said.
Master Service, formerly known as Master Dry, reported almost $30 million in annual revenue and has 180 employees in Knoxville, Indianapolis and Winston Salem, North Carolina.
Its headquarters will remain in Knoxville, Smith said.
“I have had 100% peace the whole time,” Smith said. “I tell you, I’ve gotten emotional multiple times through it, but it’s only because of the amount of money now that’s going into this foundation.”
Transforming criminal justice culture
Smith’s yet-to-be-named foundation will invest millions of dollars in changing the culture of criminal justice from one of incarceration to transformation.
“Right now, people going to prison, they don’t come out to society better, generally, they come out worse,” he said. “Because we have this incarceration penalty, make-them-pay mindset, right? Well, the problem is we’re literally hitting our own self with the stick that we’re trying to hit them with. Because now they’re getting back out, the recidivism rate is really high, and we’re not doing well by society by doing that.”
Smith endured abandonment and abuse in his childhood, was removed from his home at age 12 and was jailed for the first time at age 16. He quit school in 10th grade and at age 21 spent five years in a federal prison camp on drug-related charges.
After being released from prison more than 15 years ago, Smith began giving back by volunteering in prisons in the U.S. and in Costa Rica, Panama and Nicaragua. He founded the business in 2008.
In June 2019, he was named to Gov. Bill Lee’s Tennessee Criminal Justice Investment Task Force, created to address the criminal justice system, public safety and reentry. He also mentors a group of men who have served time in prison.
Smith hopes to fund training, workforce development and reentry programs through the foundation.
“How do we help someone return to society better than from when they were locked up,” Smith said, “so they can learn what ever it was about life that they didn’t learn before?”
More jobs in Knoxville
Founded in 1990, Contractor Nation is an international membership organization that offers training, entrepreneurship resources and patented equipment for contractors, including Master Service Companies.
The company employs more than 200 people and has 350 authorized dealers in the U.S. and Canada.
“Master Service Companies has grown steadily year over year and has been able to develop training and operational processes that are among the most effective in our industry,” Janesky said in a press release.
Janesky said he plans to continue growing Master Service’s market share and hire more employees.
“When I reflect on the most important inspirations for helping me grow this company, I think of my first interaction with Larry Janesky and the team at Contractor Nation,” Smith said in a press release. “I had no business experience, only the desire to work hard and the willingness to follow a process. The training I received was instrumental in my ability to grow Master Service Companies, and I know Larry is the right person to take the company to the next level.”
Giving it all away
Smith said he was inspired by “Giving It All Away,” written by Hobby Lobby founder David Green, in which Green advocates for founders to commit to a salary and use business profits for philanthropic good.
After reading it, Smith said he personally committed to a salary and a maximum net worth.
“It captivated me,” Smith said. “I had never planned on being somewhere where I had this kind of money. Now that I’ve got my home and I’ve got other things, what else can I buy?”
For years, Smith shied away from sharing his personal story for fear it would hurt his business or his employees.
“I’m going to be able to work in an area and use my voice in a way that I have not been able to before, because I didn’t feel like I could build my business doing that,” he said. “And now nobody can hold it against me.”