Gothic Landscape is not your average mom and pop lawn shop.
The Santa Clarita outfit is the largest family-owned landscaping company in the United States. With 2,000 employees, it earned the No. 1 spot on the Business Journal’s list of Family Owned Businesses in the Valley region.
But with that crown comes a big slate of challenges.
“How do you keep a family culture as you grow in 13 locations in four states?” asked Jon Georgio, Gothic’s second-generation chief executive. “It’s all about communication.”
That, and dedicated adherence to the company’s mission statement, which hasn’t changed since the day Gothic opened its doors in 1984.
“Create long-term relationships through team members committed to a culture of extraordinary service,” Georgio recited, making sure to emphasize the client-focused approach Gothic takes toward its work. “Our reputation is super important to us. It turns out that really resonated with our employees and our clients, who took us all over the Southwest.”
Speaking of long-term relationships, Gothic still works with its first three accounts: Pardee Homes and KB Home, both home builders in Los Angeles; and RF Development in Nevada. It has serviced the three for more than 35 years.
Today, the company has cultivated an impressive list of business-to-business clients: business parks such as The MET and shopping center South Coast Plaza in Costa Mesa; homeowners associations such as One Queensridge Place in Las Vegas and Bridgeport Community Association in Valencia; municipalities such as Lake Las Vegas; resort The Wigwam in Phoenix; and even tech titans Facebook Inc. and Apple Inc., which have massive campuses in Northern California.
“We don’t do residential. Our clients are companies that really need to market their properties as unique places to live, work and play. It’s people who have a vested interest in their property looking spectacular,” said Georgio.
Outside of California, Gothic has service branches in Nevada, Arizona and Utah.
The “Gothic” moniker may conjure certain architectural and stylistic images, but it actually comes from “Gothic Ave.,” the suburban Grenada Hills street where Georgio’s parents Louis and Judy lived and raised their family in the 1960s after Louis, a World War II Marine, finished his military service.
Louis started his own fine-grading landscape company shortly after settling in the Valley and operated it with some degree of success through the 1970s. After his death in 1979, Judy kept the company running with help from her sons and Jon’s brothers Mike and Greg.
“Mike really stepped up,” said Georgio. “He created our culture … and developed the values of our success moving forward. I give Mike a lot of credit for where we are today.”
Jon joined the fold in 1984 after earning his finance degree from California State University — Northridge. That same year, the family collectively decided to rename the company “Gothic,” as a testament to their roots. Greg immediately went to Las Vegas to direct the company’s first geographic expansion effort.
In the mid ’90s, expansion into Phoenix, Riverside and further into Nevada meant the time had come to decentralize Gothic by placing non-family regional managers in charge of these markets. For many family-owned businesses, this process comes with serious growing pains as leaders learn to surrender some of their decision-making responsibilities.
“For an entrepreneur growing a company, the single biggest challenge is to hand over the real day-to-day authority of making decisions in the company to someone else. My brother Ron (who joined Gothic in the 1990s after a stint as the president of a window and door manufacturer in Atlanta) was instrumental in teaching us to do that because he’d done it for a manufacturing company on the East Coast,” said Georgio. “That’s when the company took off.”
That was 1995. Over the next two decades, Gothic spread to Northern California and south to San Diego, and started construction and maintenance divisions that distinguished it from other landscaping services.
“This is what’s rare,” Georgio said. “They’re different businesses, they attract different employees and they’re different horticultural areas of expertise. It’s very rare for larger companies to be able to do (all three) great.”
Today, Gothic does roughly $240 million in business each year with Jon at the helm and Ron as chief executive of the maintenance division.
While co-captaining a company with your brother is an environment ripe for sibling drama, Georgio said the two rarely butt heads.
“Ron and I are very focused on our values and our culture. And we have a formal board of directors and we seek advice. I think there’s a lot of trust associated with seeking advice and collaborating. The right decisions will bubble up from that,” he said.
Georgio did bring up several other family-type issues — how are family members heard? Who will lead? Who will be invited to work at the company?
“We’ve successfully navigated that,” he said. “It’s important to have ground rules. If anyone wants to grow a family company, I advise you to get a family business consultant. They can help you collaborate on ground rules that are helpful to mitigate damage from personal issues.”
At Gothic, those ground rules include structured compensation plans that reward family and non-family employees for increasing the company’s value or drawing in extra profit.
“The company’s balance sheet is not a personal balance sheet for any one of us. We’re merely the current stewards of the balance sheet. Someone took care of it before us and someone will after us,” Georgio said.
Succession is one of the most important and obvious challenges for any family-owned company.
At Gothic, the Georgio family is already preparing its third generation to effectively lead the ship to bountiful waters, should they express interest in doing so.
“We have an annual (succession) planning process where we get together with the entire leadership team and create our organizational design,” Georgio said. “And we have a family council headed by the third generation.”
Ownership and shareholder decision-making power has already begun trickling down to “G-3,” as Georgio affectionately calls it. His brother Greg died in 1994 with no heirs, leaving three branches — Jon, Ron and Mike. After Mike passed away in 2009, his shares were passed on to his two daughters.
And while Jon and Ron Georgio are still active at Gothic’s core, their sons — Jon has three, Ron has one — are preparing for future roles at the company.
“We have a family rule that you need to work two years outside of the business full-time to experience some time on your own,” said Georgio. “My boys are currently in that process. I have one at City National Bank, one at Northrop Grumman … and one at Chapman University.”
Georgio added that estate tax planning is a must for any family business that wants to cement its future, again suggesting the solicitation of input from an estate planning consultant.
The Business Journal’s list of Family Owned Businesses saw few changes from last year — the top six companies held their rankings and no companies were added or dropped. Clay Lacy Aviation rose from No. 8 to No. 7 and Maria’s Italian Kitchen rose from No. 9 to No. 8, while Western Bagel fell from No. 7 to No. 9. Timely Prefinished Steel Door Frames and Andy Gump Inc., swapped places, with the former rising to No. 14 and the latter dropping to No. 15.