In 2008, a Yale senior made close to $60,000 in one summer painting houses. As fantastical as it may sound, especially to the many Yale students who see enervating banking and consulting internships as the only way to make money over the summer, the story of Max Rhodes ’09 is no fairy tale. In an article, seductively titled “Rhodes ’09 earns big with paint,” published in the Yale Daily News last February, Rhodes described how he spent summer 2008 running a painting business through a contracting company called College Pro Painters.
He conceded that it is “not an easy job, and it can go horribly wrong if the wrong person is set to do it.” But then, as if to suggest that there are very few “wrong” people for the job, he launched into a lengthy list of his previous failures, as if to say “If I did it, anyone can. I wasn’t successful with much before I worked with College Pro. I didn’t make the debate team, didn’t get into the a capella group I tried out for, and got rejected from tour guiding. College Pro really gave me an opportunity to reinvent myself.”
And, if Yale students needed any more reason to be intrigued, Rhodes also credited his experiences with College Pro for helping him secure a job at Bain & Company, the prestigious consulting firm, after graduation.
$60,000 of income in a single summer? A resume bullet so impressive it commands a job at Bain? An opportunity for an everyman to transform into an ubermench?
Yale students were sold.
Frank Piasta, YC ’09, is perched on the top rung of a ladder leaning against a large, Victorian house in New Canaan. Ornamental carvings, intricate spiral railings and terraces abound – a painter’s nightmare. Frank, however, seems unfazed. He swishes his brush methodically across the slats, adding to the Jackson Pollack-esque splatters on his “College Pro Painters” t-shirt. Piasta graduated last spring from Yale, where he played on the soccer team with Max Rhodes, the College Pro legend who also graduated in Yale’s class of 2009. When Piasta struggled to find a job after graduation, Rhodes suggested he sign as a Franchise Manager with College Pro for the summer to pick up some extra money and supplement his resume before searching for a permanent job. Piasta thought he had hit the jackpot.
“Max talked about how cool it was to run your own business and made it seem like it would be easy to make a lot of money,” Piasta recalls with a sarcastic guffaw. This morning, it’s easy to see that reality’s set in. “If you had showed up 20 minutes ago you would have really had a story.” As I watch him touch up second-floor window frames, Piasta launches into a story—just one of many he has to undermine the Rhodes College Pro myth. Laughing, he tells me about how one of his painters, whom he’d found on Craigslist.com, had decided to put that morning’s pay towards a liquid lunch of Captain Morgan. Piasta was watching the clock, wondering why his painter was an hour late to come back from a 30-minute break, when a police car pulled up and discharged the mumbling tippler on the steps of the work site. He had been found, the police told him, passed out on the steps of an assisted living center.
“Of course I fired him immediately,” Piasta assures me. “But it’s crazy! Working for College Pro is very much to be in the real world. You interview your painters, but you can’t really tell what they’ll be like until they show up at production. You really have to look out for yourself, because nobody else is.”
Not even College Pro Painters.
Piasta is one of fourteen current and recently graduated Yale students who worked as Franchise Managers for College Pro Painters this past summer. Instead of fetching coffee for their bosses at internships in New York or Hong Kong, these students were the bosses. They focused mainly on marketing, hiring painters and managing production, leaving the dirty work to hired employees. But when I visited Piasta’s final worksite in late September, he and Tom, another member of Yale’s class of 2009 who had run a College Pro franchise that summer who asked that his real name not be used for this article, were in fact the only painters.
Piasta was looking to save himself the $8 or $9 an hour he typically paid to employees by painting himself and using only two other painters: Mr. Captain Morgan, who had been let go earlier that afternoon, and Tom. Tom, a friend of Piasta’s from Yale, was painting to pick up a little extra cash before moving to Manhattan to search for a finance job. He had closed out his business the week before, barely breaking even after ten weeks on the job. “It didn’t really work out as well for me as it did for other people,” remarks Tom of his experience as a Franchise Manager while he picks at paint splotches on his Yale sweatshirt. “But regardless, the idea of running your own business at our age is pretty incredible.”
Tom was not alone in his struggles. Six of the 14 Yale students who bought College Pro franchises last summer terminated their contracts early and were left in debt—in one case for more than $7,000. Of those who lasted the summer, most made money, but nobody’s earnings approached what Rhodes had grossed the summer before.
Operating in 32 states and seven Canadian provinces, College Pro Painters is a painting contracting company that hires mostly students and recent graduates to run their own painting businesses. Before Rhodes’ first stint at the company in summer 2008, College Pro Painters was not a popular presence on campus – especially when compared to ubiquitous banking and consulting heavyweights like Goldman Sachs and McKinsey. But when last February turned to March and March sent most unemployed Yalies into a frenzy about last minute summer plans, suddenly the name “College Pro Painters” started popping up everywhere.
And rumors did too. You get to run your own business! Did you hear about that Max Rhodes kid? You can make lots of money! He got a job with Bain because of it! It can’t be that hard – it’s just painting.
Were you to Google “College Pro Painters” you would find that the two top searched results were “College Pro Painters Complaints” and “College Pro Painters Scam” – both clocking in with over 15,000 pages. One reads “College Pro Painting took me out of college, put me in debt and almost ruined my life.” Similar hits abound: “I need help guys! I’m caught in a College Pro scam!” The description for a Facebook group titled “College Pro Painters is Exploiting College Students” reads as follows:
1.College Pro Painters is taking advantage of students countrywide.
2.If you have bad credit, are in debt, worked the whole summer with out pay, or maybe even made some money but not the 15,000 to 20,000 they said you would earn, then this group is for you.
3.The public needs to know!! These students think that by working 40-hour weeks or more that they will be able to help with the costs of a completing a college degree, but it is not the case when College Pro Painters is the employer.
4. Please do not be afraid to stand up!!
I now had two completely conflicting accounts of College Pro. Was it the ultimate opportunity, or the ultimate mistake? And if it was a mistake, how did Max Rhodes make a killing working for the company?
I decided to work from the ground up, learning about the process of running a College Pro franchise from signing to closeout, scraping the false rumors away from the truths like paint off a peeling house. I started from the inside.
When we talk on the phone to set up a meeting, Joe Cunliffe, the Vice President of College Pro’s New England branch, sounds strangely suspicious.
“What exactly do you plan to write about?” he asks. “And who exactly have you talked to?”
I run down the list– making sure to intersperse the names of those who had positive reviews of College Pro with those whose assessments were less than glowing. “Wow. Yup, you’ve gotten to pretty much all of our guys,” Cunliffe says.
I ask to be put in contact with College Pro’s regional manager for Connecticut, Jordan Driediger, who has had the most direct interaction with the Yale franchisees. Cunliffe refuses. “Lets just see what we can get through first,” he says genially, dismissing the idea without rejecting it outright. He possesses the practiced finesse of a true salesman.
When we meet in person, at the Starbucks where he interviews Yale College Pro applicants, Cunliffe is only slightly less reserved. He is professional, carrying a brown leather portfolio and sporting a navy sweater and khakis. Only 27, he speaks with conviction and confidence of someone much older. But his baby-face and mousy brown hair lend him an unexpected and youthful softness.
I start by asking Cunliffe to walk me through the process of hiring an applicant – how does College Pro recruit its franchisees? How do they convince a recruit that buying a College Pro franchise is a good idea? What qualities do they look for in a franchisee? Given the company’s title, I was surprised when he told me that one of the answers to my last question was not that the applicant is a college student.
Though the company’s website boasts “When you choose us, you are investing in the career path of young entrepreneurs through real-world business experiences,” there is not actually an age or educational requirement in order to become a College Pro franchisee or painter. In fact, a few of the Franchise Managers and many of the painters hired by College Pro have never attended college. Cunliffe explains that the company’s name stems not from the fact that College Pro Painters hires only college students, but that it was founded by a college student in 1971.
Applicants are assessed based on eight criteria, he tells me – leadership qualities, organization, strong values, tenaciousness, instrumental ability (the combination of being able to speak well, to present, and to do math), the ability to handle stress and emotions, the ability to set (and hit) goals, and the ability to understand oneself and others. “We interview twenty-two applicants for every hire that we make,” he boasts.
One past franchisee, however, speculates that College Pro is not as selective as Cunliffe claims. “Jordan signed anyone who wanted to sign,” says Dan Li, a former franchisee who graduated from Yale last spring. Li is referring to Jordan Driediger, the General Manager for College Pro’s New England Brach who is responsible for signing all of the franchisees in the New England area.
“By law, College Pro is supposed to make potential franchisees hold the Franchise Disclosure Document for two weeks before they accept it,” Li says, explaining that the Franchise Disclosure Document includes the contract as well as all pertinent information regarding College Pro Painters. “I signed in 48 hours and they back dated the contract, stamping a date that was twelve days earlier than I had actually signed. I guess you can say I was overeager but that’s the point of the fourteen day wait.” Li, who terminated his contract with College Pro in June of 2009 when he received a job offer in finance, also claims he never received a copy of the contract to keep for his records.“They gave me another booklet without my signature,” he remembers.
“There is no way this could have happened,” Cunliffe claims when I ask him about it. “We are part of a publicly traded company and as such, are subject to government audits to make sure that we have the proper backup for everything we do including the contracts that we sign and how they are handled.”
Cunliffe seems pained that I am at all suspicious of College Pro Painters. This is not surprising—he’s invested the past nine years of his life in the company, first as a Franchise Manager for three years, then as a General Manager for three years and finally as a Vice President for three years. He responds defensively to some of my more probing questions, but he seems more sad than offended, as if I’m insulting his integrity by investigating College Pro.
Cunliffe asks me what my take on College Pro is. He poses the question so earnestly I can’t help but feel guilty for having my doubts about the company. Glossing over my apprehensions, I tell him that it seems like a lot of Yale students who get involved with College Pro are blinded by the tale of Max Rhodes, thinking they can easily duplicate his success. Nodding sincerely, with his warm brown eyes fixed on my own; he says, “Max Rhodes was the worst thing that could’ve happened to Yale students.”
If Cunliffe genuinely laments the effect that Rhodes’ story has had on Yale students, he has done nothing to curb Rhodes from heavily recruiting for College Pro Painters at Yale. For one, Rhodes was responsible for pitching the Yale Daily News article that ran in February 2009 – the same article that initially piqued my own interest in College Pro, along with a slew of other would-be entrepreneurs. An editor at the YDN who wishes to remain anonymous forwarded me an email Rhodes sent to the Yale Daily News on February 6th, 2009. It reads:
“My friend Kim Chow (then an editor at the YDN) recommended that I speak to you about a story idea I have for the YDN. Last summer I worked as a Franchise Manager for a company called College Pro Painters. Basically I ran a $227,854 exterior painting business in the New Haven area. This year College Pro is undertaking a major recruiting effort on campus.”
Ever the salesman, Rhodes goes on to cite four reasons he feels his experience would make an interesting article:
“College Pro has already hired 8 Yale students and has plans to hire as many as 12 more. I painted the houses of several Yale employees, including professor Paul Bloom and his wife Karen Wynn. I netted around $60,000 in total assets ($46,286 in cash). I think that’s a pretty attention-grabbing figure. It’s an unusual way for a Yalie to spend his or her summer, but with fewer options this year, it’s a great alternative to more typical internships like investment banking or consulting.”
A subsequent email from Amir Sharif, the YDN staffer who reported the Rhodes piece, to the YDN editors shows that Rhodes was hell-bent on making the article as prominent as possible. “Max Rhodes is really intent on having some kind of a front-page reference to the article,” Sharif writes. “I mentioned that a story with a picture may be more visible, and he suggested sending a photographer up to East Rock to take a picture of him against professor Paul Bloom’s house, which he painted.”
The press worked: Rhodes alleges that he was directly responsible for the recruitment of five out of the 14 Yale students who signed with College Pro for the summer of 2009. “The College Pro administration had us talk to Max before we signed,” explains Tom, Frank Piasta’s friend who made close to $0 in profit working as a Franchise Manager before closing out his business and helping Piasta paint for a few weeks. “He told us all about his successes.” What Rhodes didn’t mention when recruiting other students, however, was that he would receive $1,000 from College Pro if someone he referred signed a contract with the company.
College Pro makes most of its revenue off of franchisees booking jobs and buying proprietary materials. It makes sense that the company would want to recruit and sign as many as possible. Why franchisees would want to sign with College Pro in the first place is another question altogether. Paging through the Franchise Disclosure document that Cunliffe sent me after our meeting, I was amazed by the terms that signers agree to.
Franchisees must independently cover the costs of all of their painting materials, find their own means of transportation to job sites, and personally pay their painters. They must also pay College Pro for “proprietary” advertising materials such as signs, door knockers, uniforms, payroll services, direct mailing postcards sent to potential customers’ houses and telephone answering service. Though they vary on a franchise-by-franchise basis, costs for opening a College Pro franchise can total over $10,000. In addition, when a franchisee signs a contract with College Pro, he or she agrees to give College Pro 20% of the revenues. If the franchisee’s business exceeds $70,000 in revenue, the percentage of “royalty fees,” as the contract calls them, decreases. Even with that concession in mind, the figures in the Franchisee Disclosure document suggest that College Pro usually ends up making more money in royalties than the franchisee receives in earnings after covering all the costs related to his or her business.
Perhaps the most worrisome article in the document is a non-disparagement clause that prohibits the franchisee from “at any time, directly or indirectly, mak[ing] any statement, oral, written or electronic, or perform any act or omission which is or could be harmful or damaging in any material respect to the reputation or goodwill of College Pro or any other person or entity related to College Pro.” Citing this last clause as their reason, many of the Yale franchisees interviewed for this piece refused to speak on the record or declined to speak at all. Though the non-disparagement clause is lawful, it can also have alarming consequences.
“The clause is quite broad and might well prevent students from telling other students if they have poor experiences,” says Ian Ayres, the William K. Townsend Professor at Yale Law School and a Professor at Yale’s School of Management who specializes in contract law. “It might have a chilling effect on even legitimate whistle-blowing as franchisees would worry about whether blowing the whistle would expose them to legal liability for disparagement.”
On top of all this, if a franchisee terminates the contract he is required to pay College Pro “expenses incurred in retraining a replacement franchisee, airfare, hotel, meals, telephone and any other direct expense associated with the re-training of the replacement franchisee; postage, delivery or collection costs incurred in retrieving all information, manuals and materials from Franchisee; and reasonable attorney’s fees incurred as a result of Franchisee’s termination” or $4,000, depending on whichever figure is greater.
The “State Cover Page,” a sheet at the front of the Franchise Disclosure Document that College Pro is required to include by Connecticut State Law, is no more comforting. “Please consider the following RISK FACTORS before you buy this franchise,” the document warns, listing six factors in capital lettering. Among the more startling articles are:
“2. AS A COLLEGE PRO FRANCHISEE, YOU WILL BE REQUIRED TO PAY CERTAIN FEES TO COLLEGE PRO EVEN IF YOU HAVE NO REVENUE.
3. APPROXIMATELY 118 FRANCHISEES, OR 28% OF FRANCHISEES WHO SIGNED FRANCHISE AGREEMENTS FOR THE YEAR 2008, TERMINATED THE FRANCHISE BEFORE THE END OF THE FRANCHISE TERM. OF THE FRANCHISEES WHO COMPLETED THE FRANCHISE TERM, APPROXIMATELY 57% DID NOT MEET THE SALES TARGET WE ESTABLISHED, IN OUR DISCRETION, FOR FRANCHISEES…
6. THERE MAY BE OTHER RISKS CONCERNING THIS FRANCHISE.”
According to Professor Ayres, the only benefits that College Pro is contractually bound to provide to its franchisees are a brand name and training. “There are many marketing schemes where the royalty of 20% for the brand name would be in the realm of reason,” says Ayres, who is both a trained lawyer and economist. Take, for example, the Big Mac of all franchises: McDonald’s. In addition to supplying its franchisees with a highly recognizable name and trusted products, McDonald’s offers a rigorous training program called Hamburger University for all of its higher-level employees. College Pro Painters’ brand recognizability and training regimen both fall short of McDonalds, yet their royalty fees exceed the chain’s 12.5% royalty fees by 7.5%. Additionally, a survey sent to 21 Yale professors and administrators in various disciplines suggests that the name “College Pro Painters” might not be an advantage at all. Fourteen of the Yale employees surveyed asserted that they would not let College Pro Painters paint their houses. Many franchisees complain that the training provided by College Pro is also sub-par. Franchisees are required to attend a set of training sessions held in the College Pro Painters headquarters, a converted industrial warehouse in Woburn, Massachusetts. Cunliffe sees these four 8-hour classroom sessions held over weekends from February to June and 3-4 day painting workshop held in the field as the “biggest incentives that franchisees get from College Pro.” It is during these meetings that the College Pro Painters staff attempts to teach franchisees everything there is to know about paint systems, paint failures, estimating, marketing, selling, interviewing, financial management, conflict resolution, scheduling, and logistical items franchisee’s need to accomplish to properly set themselves up. Most of College Pro Painters’ franchisees have never painted or run their own businesses before signing with College Pro, so it is up to the College Pro staff to educate them completely. Many of Yale’s franchisees, however, complain that the training sessions did not do enough to prepare them for their work in the field.
“There’s no way you can teach someone everything about painting and running a business in a month, especially in a classroom using power point slides,” says Tyler Schied, another member of Yale’s class of 2009 who signed with College Pro Painters as a Franchise Manager last spring. Schied terminated his contract with College Pro in April 2009, before ever painting a house, fearing that if he stuck out his term he would lose more money than he would by paying the $4,000 exit fee. “They give you crash courses on how to paint, but they don’t teach you how to train your guys – many of whom have never painted either.”
Even those students who had more favorable experiences with College Pro Painters agree that they felt under-prepared when it came to knowing how to train their employees. Hyatt Bailey, a Yale student who made $10,000 working as a franchisee this past summer, remembers, “At first, production is such a mess. You barely know how to paint and then you have to train your painters when you don’t really know anything yourself. All the while you have to keep your customers happy and make it seem like you know what you’re doing.”
Bailey was so nervous about how unready he felt for his first day of production that he stayed up until five in the morning reading articles on management strategies, trying to devise a game plan for how he was going to lead his painters. He was supposed to wake up a mere hour later at six, but ended up sleeping until he got a call from his painters at nine-thirty. “I was like ‘Oh my God!’ In terms of leadership you don’t really realize how bad it is until you’re the boss. It’s not just like an a capella group, or other school group where you’re like ‘sorry I’m late guys!’ It’s real life.”
Even with its manifold risks, College Pro’s attraction is so powerful it even causes some Yalies to put painting before school. Bailey felt he gained so much from his experience as a franchisee that he is taking a leave of absence for the 2009-2010 academic year to work for College Pro. While College Pro Painters markets itself as a summer option, Bailey notes that franchisees must start marketing months before May if they are to book a solid number of jobs to produce over the summer.
For College Pro franchisees, marketing consists mainly of “cold calling,” or showing up at homeowners’ doors unannounced and inquiring whether they would like their house painted. New England is a prime area to be a painter since most of the houses are wood, and so require stripping and repainting every five years. If left untouched for much longer than that, the wood under the peeling paint will begin to rot and the house might begin to leak, or even collapse. But even here, cold calling is not easy.
While touching up an eave on a house in his assigned area of Clinton, Connecticut, a middle-income area 30-minutes north of New Haven, Bailey tells me how he spent all of his weekends in the spring knocking on doors trying to book jobs. If that was his only responsibility, he might have managed, but Bailey began marketing while taking five courses and singing in one of Yale’s premier a cappella groups, the Baker’s Dozen. “Needless to say, my academics suffered a bit,” he admits. “When I signed again for next summer, my dad didn’t want me to be in school while I marketed so it was understood that I would take the spring semester off. Then I decided to take the fall off as well to finish up my College Pro jobs from the summer.”
Other franchisees had less of an issue with the time management aspect of marketing than the ethical implications of selling a product they didn’t believe in.
“It’s kind of sickening,” says Li, the Yale franchisee who terminated his contract with College Pro in June. “When I was marketing I had to go up to home owners with a shtick about helping college kids, when maybe I was a college kid but neither of my painters had ever been to college. One of them hadn’t even graduated high school. And many of the painters are a lot older than your typical college kids.”
Tyler Schied, the Yale franchisee who quit before ever painting a house, agrees with Li. “Franchisees show up to the first day of production never having painted a day in their lives, with painters who have never painted a day in their lives, all the while marketing a ‘professional’ painting job,” he says, the frustration rising in his voice. “College Pro is scamming kids that are scamming consumers. It’s a total pyramid scheme top to bottom.”
At the bottom of that pyramid are the painters, most of whom were hired via Craigslist. According to Piasta and Bailey, College Pro urges its franchisees to pay the painters $8 per hour, exactly the minimum wage in Connecticut, though many Yale franchisees report having padded their painters’ salaries by a couple of dollars.
If College Pro really is as exploitative as Schied and Li insist, it is interesting to consider what persuaded them and other Yale students to sign in the first place. “They never bring up the idea that you could fail at this, and that if you do you could get yourself into a lot of debt,” Schied explains angrily. “It’s all in the contract, but they gloss over all of the bad stuff so you’re lulled into thinking, ‘Oh man! My own little business. This is going to be fun!’ All Jordan, the regional manager, does is paint this picture of Max Rhodes and how working for College Pro made him tons of money and won him his dream job at Bain. Of course my first instinct was ‘Where do I sign?’”
Piasta points out that Yalies are particularly susceptible to the College Pro myth. “Coming out of Yale, you feel like because you’re smart you’ll be able to make everything work out,” he says. “Yale kids inherently believe that they are incapable of actually failing at anything.” Like Schied and Piasta, many Yale students signed contracts with College Pro feeling confident that they could duplicate Max Rhodes’ success. So far, none have come close, which raises the question: just how did Max Rhodes pull off what he did?
Over the course of October and November, Rhodes and I exchange six sets of emails, each with him promising to call me or answer my questions by email and apologizing profusely for being a “bad interviewee.” I resort to tracking Rhodes on “Around the World in 100 Days,” the blog he started (username: MaxtheYaliePainter) with his girlfriend to document their travels. Rhodes is handsome in an elfin sort of way – with high cheekbones, a devilish grin, and a haircut that looks like someone put a bowl over his blonde mop and trimmed away what protruded. I flip through photos of the two of them driving a rental car on the Autobahn, castle hopping in Prague and putting back pints of beer in Budapest. On October 14th, the couple stop blogging, but from our email correspondence I know the pair also made it to Delhi and Agra in India.
Traveling the world with his girlfriend, a desk at Bain waiting for him when he returned, Rhodes was living the dream of many Yale students. He just couldn’t be bothered to talk about it.
Since I couldn’t pin down Rhodes himself, I settled for talking to his Franchise Manager disciples, and to his customers. Both groups agree that Rhodes’ success is not undeserved. They testify that Rhodes worked 10-12 hour days and managed at least three crews of two to four painters at all points during the summer. By the end of the term he had painted—or in company jargon, “produced”— about 70 houses, as compared to Bailey’s 40 and Piasta’s 12. “He’s just ravenous,” remarked Schied.
Rhodes also gets rave reviews from homeowners whose houses he painted. “Max was the most professional painter I ever worked with,” says Jack Hitt, a freelance writer who owns a house on East Rock road, one of the nicest streets in New Haven. “He was a crisp, well-natured business man and a brilliant communicator. He made a few mistakes but was immediate to correct them.”
As I stand watching Piasta and Tom pack up their materials into Piasta’s family’s minivan, which he had decorated with a College Pro Painters decal, I imagine what I would be like as a College Pro Painters franchisee.
I picture myself in paint-blotched jeans, my Blackberry constantly vibrating as customers called to check in or complain. I envision waking up at five in the morning to run to the paint store and distribute the cans among my crews by seven. I imagine how my feet would ache after standing for 12 hours a day, and how awful it would feel to fire a painter. I sense myself being sucked in by the challenge of succeeding at something where so many have failed, the possibility that I could be the next Max Rhodes. I could do this. I catch myself thinking.
Frank begins to descend from his perch on the ladder when suddenly the sole of one of his Timberlands slips, and he misses a rung. The ladder momentarily comes off the side of the building before clattering back against the house.
“Close call,” I say, and mean it.