When it comes to tough slogs in entrepreneurship, look no further than the California residential construction market. Any construction company that started before the real estate bust of 2009 and still exists today has stories to tell. One of them is Berkley Construction Inc. of San Diego.

Keith Berkley started in 2003 with "just a few tools and some how-to books doing odd jobs after graduating with an MBA and MA from San Diego State University.

We have been through major changes over the last seven years, won some awards, grew the business, retracted in 2009 and are growing again. We are transitioning from a small project remodeling company to a green builder and alternative energy provider."

How did Berkley survive the downturn? "We were growing every year until 2009 and had a bit of overhead in staff and office. I moved the office home, and reduced office staff by 60%. This enabled us to lower our prices enough to get through the super lean 2009."

How did the company change as the result of the bust? "Now we focus more on growing our management ability through technology and communication. We have field iPads, Droid and iPhones to make sure we get email, contracts, images in the field. Before, we had someone in the office answering phones, sending faxes, and filing receipts. Now we can do almost everything remotely. We don't even bother with a subcontractor who does not email. It's just not worth the time and headache from their being two or three days behind everyone else.

We more than doubled sales in 2010 without adding much overhead. It is a lot more work but leaner times call for more effort."

Berkley has gone after the "green" market since the beginning of the recovery. How does it market itself as green? "Green means so many things these days. Some homes require almost no energy from the grid, but cost twice as much to build. Our strategy is to try and get the designers and architects in our area to do a few simple things to improve performance without breaking the bank. We ask them to make perimeter or outer walls 2 x 6 or greater, thus allowing for more insulation. We also ask that HVAC equipment be high efficiency so that we do not get low-balled on that line item during the bid process. We want to be green and stay in business.

"We limit what we take to landfills, making sure all dump-runs have recyclables on top for easy loading in the bins before moving on to the landfill. Once we have the building performance as high as the budget permits, we offer an analysis report to incorporate solar photovoltaic [PV] production. Most of the time solar does not get included in residential projects as there are few financing options for it. Most people can go buy a car with little or no money down but not a PV system that will actually make money in about the same time as a car has dropped to almost no value."

How lean does Berkley keep its operations now? "I am the only full time office employee with a supervisor in the field that oversees all production," Berkley notes. "We did $890,000 in 2008, $435,000 in 2009, and $1,013,000 in 2010. We should have similar results in 2011. We do residential remodels, new construction, and tenant improvement work."

How did those how-to books Berkley read when he was getting into the business work out? "The how-to books left out a lot. As did my MBA. Regional differences have a huge impact on code, workmanship, and scheduling. Books can help with so much ground work, but mistakes made teach lessons. Most contractors I know that have survived these last few years have done so by paying for mistakes, even the mistakes of others. I'm not saying that one will be successful by simply throwing money at problem, but making sure problems are resolved is the primary function of a contractor.

"Choosing a good customer is critical to having a successful business. We do not always have this luxury but knowing how to walk away before starting a project with a bad customer can save a business. If they trash talk past contractors, call the contractor to find out what happened. If they just want to negotiate price before they have even talked to references, walk away. Even with a set of plans, so much is still yet to be detailed, so trying to negotiate price at that stage is like negotiating a vehicle price before the year, model, and options have been determined," Berkley says.