Pile of Scrap Ep. 3: The Real Environmentalists

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John Sacco, Edward Kangeter, and Louie Kangeter

Transcription

John Sacco: Hello. Hello. Hello. This is John Sacco, owner of Sierra companies. Sierra Recycling & Demolition. Sierra International Machinery. This is Pile of Scrap. You like that, don't you? I'm here with Edward Kangeter, President or CEO?

Edward Kangeter: CEO

John: CEO of CASS Custom Alloy…

Edward: Scrap Sales.

John: Edward, thank you for joining us. Um, you've got a very unique nickname. You want to talk about it?

Edward: My nickname? What is it?

John: Well, our buddy Michael Lewis from Warsaw, Indiana calls you.

Edward: What's that?

John: Special Ed

Edward: Special Ed, that’s right.

John: If Michael Lewis has given you a nickname that means he loves you.

Edward: He's a great guy.

John: Yeah. Oh, from the heartland and a guy truly from the heart. You know, we've been doing podcasts and again, I appreciate you coming on and spending the time with us. You know, you're a scrap company, but you do some things unique. But you know, I don't really want to focus on that because scrap processing, scrap. Great. That's super. But you have an interesting background and as I was doing my notes before this, you're Gucci to Carhartt's. I mean that's a transition. You came from the fashion industry and now you're here and the recycling industry.

Edward: True Story.

John: Tell me that. How does that world… How does that collide?

Edward: Well, it doesn't normally fly to be honest with you, but uh, I had married into a family that owned a recycling operation and had the opportunity to get into the fashion industry as a young man and I was traveling the world. My last job, I worked for a multi-national, uh, based out of Italy and I was running that for the US market and launched it and helped a family business, uh, go from 70 million euro to over 700 million euro in about 5 ½ years, six years.

John: Well, that's kind of like the opposite of the scrap business. In the scrap business they always say, if you want to make a small fortune, invest a large fortune, sounds like you invest 700 million, you come out with 70 million in scrap business.

Edward: It was an incredible education. I really got to learn about the world, about people, about brands and about service, and those are all attributes that I was able to bring and apply to CASS.

John: Okay. So that's, that's where I want to go with this. So, fashion industry, you know, beautiful people, looking good, image, and you walk in the door and you see this, you know. Tell us about the transformation of day one from Edward Kangeter arriving into a recycling facility known as a junk yard, maybe scrap yard to what you brought from the fashion industry and what you've done to change what you saw from day one.

Edward: Well, day one was an interesting day because my father-in-law who had hired me and some of you know, he’s a little, uh, infamous in the industry had hired me and I had given a one year resignation notice to the family I was working for. And I showed up to report to work on the first day of work. And I walked into his office and I said, “Hey Chal, how are you doing?” And he looked at me and he's all, “what the fuck are you doing here?” And I said, “I'm here to start”. And he goes, “Yeah, I've been thinking about it. It's a bad idea.” And I'm like, “Why? What are you talking about?” He goes, “Yeah, it's not a good idea. I don't think we should do this.” And I'm like, “Ah. I gave them a one-year notice. I already trained my replacement. A little late buddy.”

John: So okay, so how did, how long from that moment you got slugged in the stomach of “Ah, I don't think that's going to work,” too, Chal coming around and saying, “Okay, you're here.”

Edward: That was about two years. Honestly, I think what happened is he told me to go find a seat somewhere after we stared at each other for an uncomfortable, no kidding, about 20 minutes and he realized I wasn't going to leave. And that's part of the fashion industry, it’s is a really tough business. It's pretty on the outside, but it's a very competitive business and I think that that served me well coming into the recycling industry. This is a very interesting, but very competitive business.

John: Okay, let's talk about that, the image again. I want to go back to image. What was your thought, your image of the industry, and then when you get into it, you see the reality of it and all these years later, you know, I walk into CASS today and I'm seeing an office that doesn't even represent anything as a recycling facility. I mean this is like walking into an office maybe for Sacks or for, you know, somebody, Nordstrom's, or something like that. I mean it's beautiful. Tell us about this, your thoughts and how you're changing.

Edward: So, I think my initial thoughts on the industry was it looked very Sanford and Son, it was an ugly business, but I didn't understand it. As I learned more about it, I realized it's a fascinating business. It's filled with incredible people. Um, had the opportunity to form relationships and friendships with people such as yourself that I have a tremendous amount of respect for. And at the same time, I saw a business that was, or our business, but also the industry that was ripe for new ideas and really needed to evolve. The industry had a very, at least in Northern California, a negative connotation.

John: Don’t you think that’s true though for well scrap? It’s interesting because we'll get into legislation and regulatory burden on our industry because you're on the forefront of fighting those battles all the time. Especially up here in the Bay Area. Everybody wants to be green; everybody wants to recycle. Yet it's our facilities that always seem to be the target and you were one of the first people to ever run a billboard ad here in the Bay Area. Again, back to image, you're changing the image. What, tell some of the ideas that you implemented in that that you've seen actually work where people have actually told you, you know it's great what you're doing.

Edward: Yeah. I think the image aspect of our business was to educate the public on what we're actually doing. So, we really tried to highlight all the factors that we thought made CASS a really interesting business and as all of the people in the industry know recycling aluminum saves 90+ percent of the energy that you would use going from box side or to final product. But the things that we do here at CASS that are really different is we've taken it a step further and we're kind of like the organic, weirdo hippies in Northern California where we're making aluminum without chlorine. So, we're a chlorine free operation.

John: Okay, well let's talk about that. Chlorine free. Look, I don't know anything about aluminum, making aluminum. I see it on t-shirts now that you have put out, ‘You're 100% Chlorine Free Aluminum.’ Great. I have chlorine in my pool. Why is that important and why is that now setting you apart from other aluminum ingot makers?

Edward: Well, just like my swimming pool, that is salt water instead of chlorine. My aluminum is also chlorine free and there's a reason, because chlorine is a nasty gas and if we think about how chlorine was used in war, we can also think about what a tank of chlorine can do in a half mile radius of that location. Like a lot of industrial facilities, we're up against encroaching residential and furthermore, we have all of our staff here that we actually care about the people that work here. Chlorine is nasty and I understand why other people use it in the industry because frankly speaking it's easier.

John: How's it used?

Edward: You use chlorine and you inject it into the aluminum to help clean out impurities so you can buy a lower grade metal, or you can take a metal and reduced mag content, et cetera. So, it's a way to help clean the aluminum. However, what we do is we use better aluminums in the first place and then we go through a process with an external filtration and also with a magnet. We were the first ones in the United States to use an external magnet to move molten metal, it’s a company called Zmag. Alcoa and everybody else that's a major producer now use those. But we were the test company for that in the United States. But the whole point goes back to what kind of company do we want to be, and we wanted to create the safest, most efficient work environment that we could, that would allow us to be the company that we wanted to be. And part of that is not using Chlorine and you know like you see the offices. We wanted to give people an environment to work in that we felt was inspiring and that set a standard that let them know what we expected from them when they're dealing with our clients.

John: So maybe Gucci needs to be making uniforms. Steel toe boots. What do you think?

Edward: I think it'd be interesting. I don't know.

John: You would be the first. You can probably make a fashion statement, Huh? What the heck? You are changing the industry. You're taking changing the image. So, okay, let's talk about your chlorine-free aluminum ingot now, people or manufacturers who are buying that. Do they know that?

Edward: Some of them do and some of them are still learning about it. We have clients that that's really important and we have other clients that don't really understand the value. My personal opinion is this is where the industry will go. There are going to be clients that really care about the entire life cycle of products and it's kind of like the electrification of vehicles in our market. Combustion engines, that's the past.

John: Electric motors.

Edward: Producing aluminum with chlorine and toxic gases, that is the past.

John: Okay. So, you're going to be, you're on the forefront of this. How are you getting your message out there? Cause I think to me, you know, you see Coca-Cola and these bottling companies, they're using, “our plastic bottles are made from 98% whatever recycled product,” but it's, it's the way they're doing it. So, I'm waiting now for somebody to say our aluminum and our product is made chlorine free.

Edward: So, we've started to include that in all of our documentation, all of our branding here at the company, on all of our equipment, and we're preparing to launch a social media program that we think is going to drive awareness in the larger, uh, social market.

John: Well, I think that's great. I think that really, that's going to be important for the marketplace and I hope you get your word out there and it helps you grow your business and then that becomes another challenge. You get it out there. You start growing your business you’re up here where the land is ridiculously expensive. How do you expand there? So, are you ready to expand? If you do get out there and you got new customers who want to buy CASS’s as aluminum and now what? Now what do you do?

Edward: We are 100%. We're really well positioned to expand and we're actually in the process of building a new facility, which we're going through entitlements right now. And once the entitlements clear, we'll be building a new ground up facility here at the foot of the Bay Bridge.

John: So, for the years that I've known you, you've kind of flown underneath the radar. Right? Would that be accurate?

Edward: 100%.

John: Now we're kind of having to get you out of this comfort zone. Get you out of your fox hole and make the charge. You know, I kind of laugh at you in some respect because here you are trying to hide, but you can't turn on a Warriors game without watching you high fiving Steph Curry running down the court. Come on, you already out there! Where's your CASS shirt on the floor?

Edward: It's, I don't know.

John: Where's “100% Percent Chlorine Free Aluminum” on the floor? Look, your son got abused on Twitter for wearing some stupid headband one day.

Edward: He should have had on a CASS.

John: He should have had on a CASS Chlorine Free Aluminum. But you're there.

Edward: Yes. Yeah, I know. I need to do a better job of that. It's certainly an area that I can approve.

John: So, you've got your seats for the new arena?

Edward: We do.

John: Awesome.

Edward: Yeah, we're really excited.

John: So, when I turned the TV on, am I still going to see you?

Edward: Still gonna see me. We may not see the Warriors doing as well as we've seen them do in the past five years.

John: Well, I didn't give a crap about that. I just want to see Ed Kangeter on the floor. High fiving Steph Curry. That's the greatest or Gregg Popovich moving your arm out of the way that I got to witness firsthand.

Edward: When Greg… When Popv tells you to move, you move.

John: How about this, last year, we were on the floor and the player from the Toronto Raptors, I believe it was you went to reach for the ball going out of balance, he grabbed it, slapped it and looked you in the face like you were some villain or something.

Edward: Yeah, no, that was classic. I was actually trying to protect one of my seat neighbors who's an older woman and I thought the ball was going to hit her in, in the face. So.

John: Yeah. Well, you know, hey basketball, watch out for the ball. Baseball watch out. Keep your eye on the ball, they always say. So what? Back to CASS and to all the changes that I personally have seen and all the things you're doing in this plan to move in a few years, and of course zoning and all that things gonna take more time than it should. How many years is it going to take?

Edward: The best scenario would be two years. Worst case scenario, right now it's like five years.

John: You want to know how long it took me to get my permit to do my 70,000 square foot factory in Georgia?

Edward: How long?

John: Well, Jim Bo Boykin was sitting in front of me and he says to me like this, he says, “Mr. John, you give me the order today and I'll be pouring on Monday. I'll be forming on Monday.” I went, “Excuse me, how do you get a permit” and he looked at me like “Permit? I already got it. All I do is tell them I'm building and they're giving it to me.” Kind of different, Huh?

Edward: A little in California and specifically Northern California. It's really different.

John: California, we both love. We both have our headquarters here. I have my factory in Georgia where we build our two-ram balers. Full disclosure, CASS is a customer of Sierra. You have a couple of our red machines and a couple of our green machines – a 900-ton shear and a 750-ton shear – for full disclosure. You know, I did a podcast with the customer who I sell paper to owns no, no Sierra equipment, but I lost my train of thought and I have my notes in front of me. Maybe I need your blue, Blue Cup coffee or what? Blue Bottle Coffee. That's what I need over here. That's good coffee by the way. That's good. I like that. Coffee. Okay. Regulation. You have fought and you have worked hard when you were President of the California chapter for ISRI, in your local community. We're fighting regulation that could kill us. Tell us something that can wipe out… Tell us something about the regulation coming down the pipe that could really wipe out every recycler in the state, every steel manufacturer in the state, every, you know, anybody who handles new steel, which everybody needs for construct. Tell us about that.

Edward: So, I also just came off being president of California Metals Coalition. I still serve on the board and I still serve on the board for the ISRI West Coast Chapter. In those roles I was educated on how the air districts work in California. They are aggressively regulating our industry and moving towards more stringent standards. The most alarming of all of them is the nanogram standard.

John: what is a nanogram?

Edward: A nanogram is one in a billion, that's a ‘B’. One in a billion. So, they want to regulate our industry for particulate matter down to one in a billion. The technology that is used to measure that has an error rate that would exceed the level that they're trying to measure. So from that perspective alone, I don't understand how we can be regulated on that, but we've raised almost a million dollars in the past two years to hire experts and to go out and to put a lot of pressure back on the regulatory community to use real science based on real facts and get away from emotions and political agendas.

John: So, look, you're up here in the Bay Area, which is a notorious Democratic area, and you go in there and you talk to them about business. Okay. Because you know, this is not business friendly. What is the reaction? Because you're out there, you talk to these state assembly people, state senators? Um, all the time. What's their reception to you when you walk in and you start talking to them? Are they like get out of here or are they listening?

Edward: They listen. I think that all of us in the industry have an obligation to know our assembly member. Know our senator. Know our Congressman, which I do, and they've all been to our facility and they've toured our facility. They understand the diversity of our workforce, the impact of our business, and also that we're working at a very high standard. And so once you can educate them on the type of entity, business that you are, or your culture, then you get more support. It doesn't mean that they're going to agree with you on everything, but you have a much better chance of getting some rational approach to decision making.

John: Well, you know, I think common sense eventually will play out and that they'll understand that you can't shut down the entire recycling industry that handles any form of metals in the recycling stream because of dust that might come up. Look, you know, I always said our facilities, we are the original environmentalist. We are the stewards of the land. Now, some of us, some players haven't played so well, but there's so much regulation in place now that you know, walking your yard today, it's spotless. You know, you have a culture here at the CASS. You know, I, I saw a one-and-a-half-year-old material handler that doesn't have a scratch on it. You know, you have the culture in place now that's in its own right its own battle. Where did the, how, how's that journey coming along?

Edward: That journey came about by wanting to be more efficient with our resources and run a safer operation. And what we realized through bad experiences is that when you don't have that culture and you don't require accountability within the staff, after you educate them why it's important, you make mistakes that (A), you regret or (B), you can't afford. And three years ago, we had over $1 million worth of operator damage. Uh, last year we were able to keep it under 150,000 and we're on trend to be under a 100,000 this year.

John: Well Congratulations. Look, we have the scrap facility too and I know what it is. Operator damage. Cause some people don't care. And reducing that cost makes us keep our doors open. I mean my God; we can't afford it. The commodity markets aren't great right now. Everybody knows this. And you know the people who handle… I was talking with Jason Young from the Allen Company yesterday talking about the blue bin because he does a whole recycling program for the blue bins. And communities that he does it for, these cities and counties and what have you. They're used to getting money back. But the commodity values have an absolute zero value. So, the only way we're going to keep our doors open is by reducing the expenses that we just can't afford because it's sure cost enough to open the doors as it is in California, let alone have our own people make these mistakes. And I wish you the best of luck on that journey. I mean, I think it's every day that we go into our yards and go, “Oh my God, how are we going to do better? How are we gonna…?” You know, that's why one of our slogans at Sierra is “We do what you do.” You know, our equipment business.  We do what you do because we own and operate a scrap yard. And we just launched our 60th anniversary marketing campaign. So hopefully you get to look at it. Uh, it's pretty cool. But you know, again, that's part of what we do. So as an industry as a whole, from the national to the state level, how can we move? How can we create…? What needs to change with everybody? Because, you know, one CASS, one Sierra, we can't do it alone.

Edward: No. We need to get the good actors to segregate themselves from the rogue actors. We need to be more disciplined as an industry and about doing the right thing proactively. It's good business in the long run, but you know, you gotta protect your employees. You've got to enforce lockout, tag out. You gotta use high visibility. You've got to have good practice and not take shortcuts. You've got to do preventive maintenance for the people who are using equipment so that it’s is going to be able to do the job, but it's also not going to potentially harm someone. And then probably the sacred cow that nobody else will like is, I think you've got to change the word scrap. I think it's not a good way to describe our industry anymore. And the reason I don't use it is because I think we're all manufacturers. We're in the recycling industry and we're taking products that are obsolete products from society and we're turning it back into the first steps of manufacturing.

John: To the virgin products that they've got to use.

Edward: That's right.

John: Yeah. Instead of using iron ore, scrap metal now is to the virgin material, if you will, that the new cores, old electric arc furnaces are using and for that matter, you're vertically integrated here with your furnaces. You're taking aluminum scrap and you're turning it into aluminum ingot and manufacturing process that will get made into… Tell us the product. Thinking of which aluminum ingot, the people you sell to, what kind of products are they making with your ingot? What do we use every day in our lives that actually might be coming from your ingot?

Edward: Everything. We have clients that make ice cream scoops out of the aluminum that we make. We have a client, very famous client that makes trucks for skateboards. Uh, we have clients that make automotive parts, Edelbrock. We have other clients that make interesting technologies. Um, we work with aerospace, semiconductor, and noncritical components, a lot of different stuff.

John: What's your favorite product when you see it? You kind of pump your chest. That's my aluminum in it. Come on. Which one?

Edward: Probably as a young man, I always wanted to be a skateboard guy and it just never became that. So, when I see somebody riding on Independent Trucks.

John: I think that's really something special. That's cool. You know, we know somebody who knows somebody who has a skateboard business. His name is Darren Doane, you know that guy? Famous filmmaker.

John: You know, I think Edward, you know, you are, you know, by the way, I tried to get you to run for officer of ISRI, which I was the chairman of, and you turned it down because you're busy. But I gotta tell you, our industry needs you to lead. We need you as an officer and I'm hoping someday in the near future, within the next couple of years that you have that opportunity because your leadership, it's critical and it's on a world stage. I mean, we're fighting from Federal EPA, Federal OSHA, trade, you know, all the DOT and you name it, your leadership. You know, I've worked side by side with you and you have an understanding of the industry, you have an understanding of regulation, you have an understanding what needs to change and it's my hope that you get involved and become an officer. And besides, it's a lot of fun, you know.

Edward: Well, you're going to have to convince this young lad over here and his brother and sister to come run the company and then I'll have time to do it.

John: You know what’s funny though, it reminded me of the story when we, you and I really first met, we were customers and how we became friends. I threw your ass out of the meeting because I did not know. I knew Ed Kangeter, but I did see it. So, I come over, “Excuse me, you have to leave this meeting,” and you look at me and” John, it's Ed from CASS,” and I went [speechless]. That took me about three, four hours to get over.

Edward: The best part was, it was at a board meeting and they went to a private board members only and John was literally at the other end of the room and there's probably about 30 people between us and I can see him looking at me and I'm sitting there and I'm like, eh, I’m just preparing for the meeting and he made a point of walking all the way around to come over and telling me that it was board members only.

John: Yeah, that's, you know… What can I say? We've traveled a lot in this world. Tell us about the abuse you got when you told me you were checking back for a three-day trip to DC.

Edward: Oh, yeah. That's part of coming from the fashion world, your got to be able to change.

John: I get this call from you Ed, “Yeah, Johnny, what time are you going to be in DC? We might be able to catch a car.” I go, “Yeah, I arrive at 5:45 and I'll go straight to the curb.” And he goes, “Well, I've got to pick my bag up from baggage claim.” I'm like, “You checked the bag for three days?” Yeah. And then Doug Cramer began to abuse you because I called Doug immediately. “Hey, this guy checked the bag.” You check it bag anymore for a three-day trip.

Edward: Sometimes, depends on where I'm going and what I'm doing.

John: Okay.

Edward: To be honest.

John: Well, are you checking a bag for DC? Well, you're going to be gone for over a week. I get that, but I'm not checking the bag.

Edward: DC and then to New York.

John: Tell us the story. I love this story because see one of our friends, and you know the beauty of our industry and what we've done. We've traveled to different trade associations and we go to the BIR, the Bureau of International Recyclers, and you were in Hong Kong with George Adams who's a president and CEO of SA Recycling and her monster outfit, and George is good friends, but people didn't know who you were because you kind of just heard, so you came up with this great story and I want you to share this story because I'd love this story.

Edward: So, this was an exclusive event for SIMS and George was attending with Joanie and they invited me to attend, cause we were in Hong Kong and I was traveling by myself, and so we show up at this event and you know, there was about 150 people there, maybe more. And we're at the bar and at some point, George's in another conversation, Joanie introduces me to this lovely and young lady and we're talking for a minute and she says, “What do you do?” And I said, “Well, I drive for George and Joanie.” And she's like, “What do you mean?” I'm all, “I’m their personal chauffeur.”

John: Yeah. Well, people want to know you're always in the most elegant suit and tie. I mean, you're always looking like 1 million bucks and they had to look at you like…

Edward: So, she was a little surprised and then…

John: She looked at your shoes or something.?

Edward: Yeah, well the best part is I was talking to Joanie about my day and I had swum laps before I came over to the party and I was explaining, I was staying at the Four Seasons, they have a pool that overlooks the Hong Kong Harbor. So, I'm swimming laps in this infinity pool and it's just spectacular, and so I was explaining that to Joanie and she's all, the young lady, she goes, “So, you drive for George and Joni and you're staying at the Four Seasons?” I’m all, “Oh yeah. They were really, really incredible people. Very generous.” And then she looks down at my shoes and I was like shocked, I was wearing boots and she recognized the brand and she goes, “Are you wearing Dior boots?” And I'm all, “Yeah.” And she's all, “Those are like really expensive.” I said, “Yeah, I know.” I said, “Can you believe that George and Joanie bought me these today as a gift for being such a good driver for them?” So, it was this like this running joke and she absolutely bought the entire story. At some point, she believes that I actually worked for George and Joanie.

John: Did you tell her you were carrying a 45 in your back?

Edward: No, I did not tell her that.

John: Well, one thing I know about you and your clothing things. Don't go to Nobu’s and drink sake and go shopping with you afterwards. Cause that was the most expensive shopping. We got to Nobu and we're having a great dinner and Edward's going, we've got to go to Ferragamo’s. I would never buy myself a pair of Ferragamo’s. Never in my life did I ever think I would do it. And there I was buying not one pair, two pairs. Thanks Ed.

Edward: You're welcome.

John: And my wife keeps going aren't we going to Nobu with Ed? Are we going to Nobu? Because she's thinking that she's going to get that shopping, you know? No, that was a very expensive, uh…

Edward: But you love those shoes now, right?

John: Yeah. I love the shoes, but that was one expensive dinner. I don't really, speaking of expensive dinners, we eat a lot of good food. We won't name names here or price, but the dinner we had at Nobu in Washington D.C. where your son and my son decided they're going to get into Sushi eating the contest.

Edward: Oh yeah, that was…

John: And so, there's your son and then there's my daughter and, and um, and then you know, George was there and another friend of ours and so the bill came around. We all threw our credit cards out there, but the poor guy, he's just one guy. He picks up the bill and he just goes white. It was a $4,000 dinner bill.

Edward: Yeah, it was expensive.

John: So, speaking of the kid who eats a lot of sushi, I want to take this moment and I want to bring your son in here. Sit right over here to the left hand of you and I want Louie Kangeter. Get a chair there, Lou, what are you doing? So, let's scoot the microphone over to your son. The famous Louie Kangeter. See you're the one who told your dad you have to do a podcast and now you're on it, how are you feeling?

Louie: Now, I'm on the podcast.

John: Are you nervous now are you're like scared to death?

Louie: No.

John: No, you're good? All right. So how do you like working for dad?

Louie: It's actually pretty good.

John: Yeah, I hear you're a little brother works here too.

Louie: Yeah.

John: So, who's in charge? You or your little brother.

Louie: Neither of us now.

John: Can you work with him?

Louie: Um, sometimes. Sometimes we can and sometimes we can't. We're getting better. It's, sometimes when we work together it gets back to a little bit more of the older brother, younger brother. But sometimes when we work together it's, it's like when we get really involved in what we're doing and we don't think about, you know, who's who, we're just focused on getting stuff done that's when we work well.

John: How many years apart are you and Max?

Louie: Well, we're, what? Probably six. I think. Six years apart.

John: How old are you? 20?

Louie: Yeah.

John: Okay, so you are the same age difference as my brother Philip and I. Now, we've been partners from the get-go. So, if you ever take over this business, I know your little brother loves this business. You think you’ll be able to work with them, Huh?

Louie: Yeah.

John: You guys will be able to put your ego aside?

Louie: Yeah.

John: Cause it's not easy.

Louie: No, I don't think it would be easy.

John: All right, so let me ask you this. So, you'll hear your dad, you see what your dad is doing and of course your grandfather, you know, one of the most innovative, really truly – crazy – but one of the most innovative, truly one of the most innovative individuals ever in this industry. Undoubtedly. What do you see the future of CASS is?

Louie: I see the scrap industry, the recycling industry changing.

John: He used already, the dirty a scrap. you didn't even listen to what your dad had to say.

Louie:  But the thing is, I see the industry going digital more and more, and I think that that's something that the recycling industry hasn't done as much as a lot of other industries have in the past. I think over the last 10 to 15 years, a lot of businesses have realized that the way to move forward isn't the traditional business method, which is, you know, hire another employee or you know, fill up the gap with more people to do the job. It's find a more efficient way to do the job and it's find a process that allows you to learn from what you're doing.

John: Okay. I know you're a pretty smart kid. You're good friends with my daughter, Giovanna and my son John Carlo. Why not go to law school first instead of coming back? Why not become an attorney? Because I'm going to tell you the amount of money the company spends on attorney fees each year. Sierra does. So, I want Giovanna to be an attorney. Why not go to law school? What's the rush?

Louie: So, I hate reading case law. That's the reason.

John: Well, I don't want to go to work every day.

Louie: I've done law trials for almost six years at this point and I love getting in front of people and speaking. I love being a lawyer and I love, uh, being a witness on the stand. But if there's one thing that makes me hate it; it's reading case law. And every single person that I've talked to whose gone through law school says, if you want to be successful in law school, you gotta like reading case law.

John: That's all. You only got to change the like, you know, you didn't like, you didn't like Sushi the first time you ate it. I'll guarantee it. Well, you didn't like whiskey the first time you drank it.

Louie: That's true.

John: Okay, so there it is. I think you need to go to law school. Don't, don't rush. I mean, look, there's plenty of days to work. You know, when I graduated from USC in 1984 I went on a two week vacation and I've been working for 30, what? 35 years. You know, trust me son, there's time. There's plenty. Your dad's not an old guy. How old are you, Edward?

Edward: Gonna turn 50 this year.

John: Okay. My Dad was 40 years old when he had me. So, when I graduated from USC and I was 22 my dad was already 62 years old. You know, when you graduate from Emory in two years, your dad's only going to be 51/52 so what's three years of law school? He'll be 55 he's got a lot left in the tank and he's going to be able to teach you a lot. So, that’s my two cents.

Edward: There’s a lot left in the battery.

John: Well yeah, yeah, that's right. Yeah, we don't use gasoline anymore. When we refer to Edward and his driving habits, we use electrical, electricity. You know what's going to be funny as California with its energy problem, how are you going to plug in your electric car when we don't even have power in this state?

Edward: Solar.

John: Ah, the famous solar. Can you charge your car on solar?

Edward: You can charge your car on wind solar if you have a way to store the energy. So, that's where storage capacity becomes a big deal.

John: Alright father to son, tell him something he needs to know going forward that, I think some of our listeners, you know, parents, we're going to get a lot of people listening to this podcast who are your age, Lou, and who have parents who want to talk to them, tell something that he needs to know going forward that's gonna really help change the way his outlook is going forward in life.

Edward: Sometimes you have to do things that you don't want to do. I agree in case law, and separately, more importantly, you have to take the long-term perspective and do the right thing. Especially if you're running a business that you want to be successful. A lot of people take short cuts and they're not willing. Everybody wants to be successful. Everybody wants to make a lot of money, but most people don't want to do the work and most people will not make the sacrifices or the commitment required. So, you have to focus and most importantly, you got to work in a field that you're passionate about.

John: I agree. I think if you don't like case law, but that's only a step to the law degree where real law is, but if you hate it, if you hate scrap; you don't want to work here. You hate recycling; you don't want to work in it. You hate auto parts; you don't want to work in it. You hate computers; whatever it is. If you don't like it, don't go there because that's a miserable existence. And you know what, for me, I'll be honest with you, the new marketing that we're doing at Sierra has energized me. I am pumped up to come to work every day because we’re creating and it's a lot fun. You like what we're doing, don't you?

Louie: Yeah.

John: Okay. You millennials, I mean my daughter and you, you talk about it.

Louie: Yeah. I've actually been doing a little bit of the gorilla marketing strategy here. Um, before we did this podcast, when I started working here, I started doing daily, what I call them Scrap Snaps. So, when I'm working in the yard, whenever I'm in the yard, I try to find at least one thing a day that I think is cool. It’s just a cool photo or, you know, a good symbol of what we're doing here, and I just take a picture of it, caption it Scrap Snap, and put it on my Snapchat.

John: I like that. Alright, wait, last thing before we finish this thing. What was that stupid headband you were wearing at the Warriors game and how many people attacked you on Twitter? What was your, what was it trending and what it?

Louie: So, it was a Supreme headband, which is a bright red sweatband, think like eighties sweatpants and the full-on jogging suit. I got the sweatband on my head; bright red says, in white, Supreme on top. And um, I don't even know, it was, I lost count. There was a Reddit thread that had about 5,000 people commenting on it about it. There was a Twitter thread had I think 900 to a thousand people talking about it and then there was a bunch of Instagram comments with a bunch of likes on them on ESPN and Sports Center’s Instagram.

John: And you missed the golden opportunity: “I am the son of the guy who makes aluminum without chlorine.” You missed it. You were trending on Twitter and you missed it!

Louie: I should have put all of that on the headband. But we'll see. Maybe we'll do some fun magic.

John: Well, fantastic. Listen, Edward, my friend, my brother, thank you for being here, Lou. Thanks for being here and thanks for talking to your dad in to saying, hey, he's got to do this podcast. I've had a ball with you guys today. Thank you so much. And that is it for this episode. Wait, you must say something?

Edward: I said, thanks Johnny.

John: All right, well this is it for this episode of Pile of scrap.

The Pile of Scrap Podcast is available on Apple Podcasts, Spotify, and Google Play. The Podcast episode videos are available on YouTube. Be sure to Subscribe, Rate, and Review Pile of Scrap.