Sunday conversation with Clint Kruger of Preferred Electric

Clint Kruger embodies the unofficial slogan of the U.S. Marine Corps, "Improvise, adapt and overcome," as he runs his Minneapolis electrical-contracting firm, Preferred Electric. The company chiefly serves local government and private industries. Kruger served with the 2nd Battalion 4th Marines from 1993 to 1997. In February 2008, just before the start of the last recession, he started Preferred Electric in his basement after an opportunity to buy an existing contractor fell through. A service-disabled veteran, Kruger grew his company from one employee to more than 50. He was recognized by the U.S. Small Business Administration in 2018 when it named Preferred Electric the Minnesota Veteran-owned Small Business of the Year. Excerpts from an interview:

Q: Do you think your status as a service-disabled veteran-owned small business helped you grow out of the recession faster than other businesses without this certification?

A: Absolutely. Under a VA [Department of Veterans Affairs] program for service-disabled vet-owned companies, you have to be a service-disabled vet-owned company to bet prime [bet on a direct contract with a contracting firm] on projects at the VA.

Being a one-man shop [at the time], I knew I could not do these million-dollar projects. I reached out to a lot of electrical shops and a lot of mechanical shops to do somewhat of a teaming agreement, when a main contractor and subcontractor agree to combine their resources and bid together on a government contract.

Q: What are the benefits of being certified as a service-disabled veteran-owned small business?

A: It has allowed us to be able to work in the field where the big boys are, where they don't have the [service-disabled] certification and they can't bid on the work as a prime [chief] general contractor. But when something comes out that is service-disabled set-aside, a contract set aside by the government that's exclusively for service-disabled veteran-owned small businesses, we can bid on the prime [contract] and we can do the work.

Q: How many military veterans have you hired since you launched your company?

A: We've probably hired 12, six still work for us. The other six we hired were apprentices that transferred away. What it does when you hire a veteran, veteran to veteran, you can speak the language. If you've been in the service, you have this common bond.

We don't think that veterans and nonveterans are on a different level in terms of skill set or productivity. I would say anybody that we hire across the board has the same skill set and same productivity.

Q: What is your company's revenue breakdown and what kind of revenue increases have you seen year over year?

A: We are probably 50% public [bid], 35% private [bid] and 15% service work. Public work is anything on the public market that anyone can bid on, such as Hennepin County, state of Minnesota projects or University of Minnesota projects. On the private side, we're bidding against one or two other people. The service side is our service work as far as industrial and as far as anything service related.

In 2009, when it was still just basically me as an employee, I did $50,000 in revenue. In 2018, we did between $12 million and $15 million in revenue.

Q: How has the growth of construction and development of commercial and industrial real estate in the Twin Cities since the end of the Great Recession affected your business?

A: It increased opportunity and the ability to purchase companies through acquisitions. We have purchased two companies and are working on purchasing a third in August or September. We've also negotiated with two other companies that did not work out.

When times are busy like what they are, you see our older generation that taught us when to get out [of the industry], and now's their opportunity. That's what we look for and that's how we've had a lot of our success, through acquisitions.

Q: What's it like to be a member of the CEO Roundtable, a nonprofit that selects CEOs from fast-growing Minnesota companies who want to share insights and experiences with other CEOs?

A: I've been a member since late 2015. Our roundtable consists of nine people, including me, representing a wide range of companies. We meet once a month for four hours. Once I got accepted into the organization, I was amazed at the experience and wisdom that was right there as long as I opened up, listened and chimed in.

What it allows for me is I can go there with questions and ask this group, "Has anybody been down this path before?" To somebody that's been down the path, I ask, "What has been your experience on doing this?" Whether we're trying to hire a new project manager or hire somebody in the office or doing acquisitions or anything like that.

Most of the time, I go in there with a mind-set of, "I think I'm going to go this way." And I get such good feedback from somebody in the group that I change the direction.

It really kind of opened my eyes to say, "OK, this is actually going to be a little bit better and this is why."