Episode 66: The Constant Struggle of Digital Marketing

Episode 66: The Constant Struggle of Marketing

Introduction:

This week, we take another crack at some questions that probably don’t have definitive answers: Should business owners outsource their marketing or bring it in house? Either way, how do you know you’re picking the right agency or the right person? Is it possible to get someone great for what smaller businesses can afford to pay? Paul Downs tells us what happened when he hired a firm to audit his website. Dana White tells us why she dumped the agency she’d retained for $50,000. And Jay Goltz sums it up: When it comes to the mechanics of marketing, he says, “We’re all in the dark.” Plus: Dana gives a franchising update and Jay starts his own business group.

— Loren Feldman

Guests:

Paul Downs is founder of Paul Downs Cabinetmakers.

Dana White is founder and CEO of Paralee Boyd hair salons.

Jay Goltz is founder and CEO of Artists Frame Service and Jayson Home.

Producer:

Jess Thoubboron is founder of Blank Word Productions.

Full Episode Transcript:

Loren Feldman:
Welcome, Paul, Jay, and Dana. Glad to have you here. Paul, I’d like to start with you. I gather you have a new marketing initiative going. Can you tell us about it?

Paul Downs:
Well, I am always wrestling with a basic dilemma on our website. Most of our business comes via Google organic searches. And for many years, I have biased the content that’s on the site towards pleasing Google robots—particularly with building out the site with a lot of language that’s designed to incorporate certain keywords and repeat them and work them into sentences in ways that no human being would ever enjoy. But the result has been steady growth of our organic traffic over time, with the exception of last year, which was sort of a different event.

And then, just a couple months ago, I have a person who handles sales and marketing within the company. She’s a part-time sales and marketing manager, and she found a friend of hers—someone who has a marketing agency—who said, “Hey, we just want to do an audit. We’re gonna line up someone who’s never seen your site. It’ll cost 1,500 bucks, and we’ll tell you what we think.” And I thought, “Well, that’s useful. I’ve had the same guys working on the website since 2013.” And the website has a lot of text on it. Because, again, this is designed to maximize our SEO capabilities. But the question is: is it human-friendly?

So they did their audit, and this young person, who was one of their team who knows nothing about my product, just looked at the site, clicked through, and then put together a very well-organized document with a bunch of feedback. And some of it I had issues with, but I thought that the basic comment—“This site is very wordy, and a lot of what’s written, I don’t even understand it”—that was actually useful criticism.

So we’re in the process of trying to figure out what to do next. The marketing firm that did the audit has presented me with another plan to basically take over our social media campaigns, and take over web design, and basically take over everything—as marketing companies want to do—and then get on to the monthly charge situation where they are an ongoing provider of things to us. And I don’t particularly want to do that, because I’ve already got people on my team making content.

Loren Feldman:
Do you know what it would cost to do that, if you did want to do it?

Paul Downs:
Yeah, they’re talking about an initial cost of $7,500, and I can’t remember whether it’s per month, or whether that’s just to begin with.

Jay Goltz:
I doubt that’s per month. It sounds like a startup fee.

Paul Downs:
A startup fee and then some ongoing fee. And just for comparison’s sake, I currently pay my web design firm—which handles a lot of these same functions—about $2,500 a month to be available at any time if I need web help, and also to do ongoing SEO optimization. I’m satisfied with their efforts, but curious to see what a new opinion would reveal, someone fresh looking at it.

So that’s where I am. I’m not dying to sign up a marketing firm to produce content for us, because I think we know content better than anybody else. It’s really this question of: who’s your customer? Is it the human using the site? Or is it the Google robot that makes that connection between that human and us? And it doesn’t seem to be that there’s any way to satisfy both, to make a site that’s both clean and easy to read and easy to use, and one which is SEO-friendly, as far as I can tell.

Jay Goltz:
Did they tell you that?

Paul Downs:
No, that’s my own experience.

Jay Goltz:
I’m in a similar thing. I’ve got internal people doing stuff, and I just joined a new business group, and there are two people on it who are really into this and do a lot of e-commerce. And they told me that I should be outsourcing all that stuff. I’m looking into it, but you ask three people, you get six opinions. It’s very frustrating.

Paul Downs:
My basic take is that when you outsource marketing, you’re handing over the messaging, particularly if it’s content production. You’re giving people who basically know nothing about the ins and outs of my business control of what the message going out to the world is. We’ve tried it in other cases, and I never found anybody producing content that I thought was good. I hired someone a couple of years ago to just do it full-time in house, because then she has a chance to be here in the shop and see what we actually do, and then I get to review her content. The idea being that someone who’s in the building is going to understand the complexities of what’s going on in a way that some outsource person never will.

Jay Goltz:
That all makes sense… Well, that makes sense on the content side, but that’s making the assumption that it’s all about producing content, versus knowing all the other little stuff that they do, which I can’t speak to.

Paul Downs:
Yeah, I think that that’s a valid point. I tried to set up my own Facebook Ads campaign, because someone on this podcast, swear to God, said that’s easy, and I could do it. And I’m not at all sure I did it right, but I don’t necessarily want to pay somebody a thousand bucks a month to do that, either, because I’m not sure that Facebook is ever going to be good for us. But there’s always that question if you hire someone: Do they understand what you do, versus what do they know that you don’t know?

Loren Feldman:
Paul, I want to go back to the decision you made just to have somebody come in and review your website. I think that’s something probably a lot of businesses should consider doing. Do you think you got the right outfit to do it? Looking back, it sounds like you picked somebody who was recommended by a friend. Do you think you should have looked around more, or…?

Paul Downs:
I’ve sat through get-to-know-you calls with a number of marketing outfits, and this crew seemed more palatable to me than anybody else I’ve seen, so I went ahead with their audit. They also were smart enough to offer this audit service at a pretty reasonable price. Okay, 1,500 bucks. Have you got it in your pocket? Maybe you don’t. But to me, that’s not a crazy amount to just see what a fresh person thinks about our site, since we really rely on that site for almost all of our business.

Loren Feldman:
My experience is there really isn’t the kind of divergence between what’s good for humans and what’s good for SEO that you described. Have you tested that theory elsewhere? Have you talked to other people?

Paul Downs:
Sure, you talk to a million people, and nobody actually knows how Google’s algorithms work. Even Google people I don’t think understand how their algorithms work anymore. I would say that my feeling has been that there is a divide, if you go all the way. We’re selling a product that doesn’t have a single configuration—it has a zillion configurations. There are a lot of different search terms that people use for them, and so we have to try to make those terms sticky, and incorporate them into our site.

Let’s just say that, of all the people who are looking for a conference table today in the United States, I’m going to guess it’s 5,000 people. I think that’s a reasonable number who have it somewhere in their mind. And then the number of people who are looking for the exact thing that we want to sell, which might be a very large V shaped table, is way lower, but it’s not zero. And the question is: What are they typing into Google to get to that to solve that problem for themselves? And so we have to kind of scatter all these various permutations of keywords that are around the concept of table, because Google will not tell us exactly what search strings people use anymore.

Jay Goltz:
Help me with that. Wouldn’t it simply be “custom conference table”? Give me some examples of what else somebody would punch in, other than that.

Paul Downs:
Oh, modern table, cool table, expensive table, cheap table, used table. Conference table could be a search for soccer standings anywhere in the world but the United States. Custom conference table can also be a search term related to sports league standings. It’s way more complicated than that. And it used to be that we could see, like three or four or five years ago, Google would show you what people typed in to get to your site. You could scroll through endless search strings and just be like, “Wow, I had no idea.” They took away that data stream some number of years ago and now you’re really guessing as to what people are typing in.

Loren Feldman:
I think there’s still a way to do that. I don’t know how to do it, but I’ve seen it done.

Paul Downs:
Are you sure?

Loren Feldman:
Yeah.

Dana White:
Yeah, the marketing team I was working with, that was part of our weekly rundown. “Here are the search terms that people are using to find your website.”

Jay Goltz:
I had a company doing that also, because again, custom picture framing could be six different terms, and they didn’t pull it up.

Dana White:
They pulled up a lot of things. I would like to say, in regards to the marketing, I found that outsourcing it for me has helped. I’ve kissed so many frogs in the marketing world that when I first decided to chop off a significant amount of the Demo Day money, you guys have said, “Well, hey, Dana, why don’t you just hire somebody in-house?” And I didn’t think that that was a good idea, because I was like, “Gosh, is there enough to do to fill a full-time position at that salary?”

What I found is, it works better when I outsource when I know more, and I’ve learned to manage my expectations of outsourcing a marketing team. And then also, what are they doing to onboard me? How well are they getting to know me? And how much time will they be spending in my business in order to create the content needed to convey what I want to convey? And so that’s what I’ve looked for when I’ve been looking for a marketing team. It’s like, okay, if your onboarding is just a quick 20-minute conversation and a one-hour conversation for onboarding and strategy, then it’s a yellow flag for me. Not a red flag, but a yellow flag. Because especially my business, which is new, you do need somebody who understands.

We had a marketing person. It was a great group of people, but the pictures that they were posting were not representative of the work that we did. Why? Because they still lumped us in the salon category. So part of their content would be, “Make your appointment today.” We don’t take appointments. We’re walk-in only. And so that’s a learning curve that I think you’d have to go through with somebody who was in-house, or somebody who was outsourced. But I’ve learned, for me, in outsourcing a marketing person, it’s about the time they spent getting to know my brand.

Loren Feldman:
I think you said that you’d set aside $50,000 to hire a marketing firm, maybe at the beginning of this year. Can you tell us about that? Are you happy with the way that’s going?

Dana White:
No. We haven’t been working with that company since then, and we’re looking for a new company. I think—

Loren Feldman:
What happened?

Dana White:
They were great people. I think they were excited to work with me. I think my story was interesting to them. But I think at the end of the day, they didn’t know black hair. And so they tried. And I don’t have the money or the budget for you to try. I need you to be able to execute and tell me what you need from me, if you need help being able to execute. Then I can decide whether I should look for somebody else to pay, or if I have the bandwidth to help you do that.

Jay Goltz:
You know what? This gets back to what I’ve said before. This is the problem with entrepreneurship since day one. Whether it’s a law firm, an accounting firm, it’s very difficult to get the best and the brightest when you’re a little company because you’re not paying the fees that the bigger companies are paying. And I’m not saying it’s impossible, but it’s difficult.

Dana White:
But I’ve moved on. And I looked at the work that this company had done—

Loren Feldman:
You hadn’t spent the $50,000, had you?

Dana White:
I have not.

Loren Feldman:
So that’s not all gone.

Dana White:
Not at all. And so I’ve moved on, and what’s funny is that as we get later and later into my franchise process, I needed to find a marketing team. Now I need to see what you can do from my one location to see if you’re coming with me into the franchise marketing world. And so that’s my very first question—because I kissed the initial frog, and I learned—they have to know black hair. And they have to have shown me that they know black hair. I need to see their content. I need to look at the work.

I did this before, but I need to look at the work that they’re doing with social media accounts similar to mine. Taking food pictures is very different than taking hair pictures, and having a curated Instagram. Jay, your Instagram is gorgeous for Jayson Home. And I’ve said, “Here’s a furniture one that I like, here’s this one that I like. Can you all do this?” And one of the things I like about this new company is, “Yes, we can do it. But just to prove we can do it, we’re going to give you 30 days of work, and you will pay us when you’re happy.” So that paying them to try is out of the window. If I’m paying them, it’s because I’ve said, “Yep, this is what I want over the next 30 days.”

Jay Goltz:
I would caution you that your conclusion—they need to know black hair—I don’t think it’s the right conclusion. You need a firm that is dedicated to doing a good job, and they will learn about black hair from you. How many people know black hair? You’re cutting out 98 percent of the vendors.

Dana White:
No, I’m not, actually. I’m cutting out 98 percent of the big people, but I’m not looking for big people. I interviewed five companies that have done marketing for black hair care that are smaller.

Jay Goltz:
So there is a category. All right, fair enough.

Dana White:
One company I was with, she posted a picture and the lady’s hair wasn’t done. And she said, “Oh, that looks beachy.” Well if you knew black hair, black women don’t do “beachy.”

Jay Goltz:
Okay, so your point is, there are people out there who do have domain expertise in that. Okay, can’t argue with that. That makes sense.

Paul Downs:
Hey, I want to just jump in with something that’s probably unprecedented in this podcast, which is to just say that what I said a couple minutes ago is entirely wrong. And I just proved it to myself. The last time I looked, which may have been years ago—

Loren Feldman:
Wait. It’s not unprecedented for one of us to be wrong. You’re not saying that, are you? It’s unprecedented to acknowledge it, is that what you’re saying?

Jay Goltz:
It’s the admission of the guilt.

Paul Downs:
Yeah, so I see that on analytics, I can now see the search queries. And I do know that there was a period of time when you couldn’t, but it looks like they’ve got them back up there. So anybody who wants to look at their search queries, yes, you can see them. I was mistaken.

Jay Goltz:
I would say this, as far as picking vendors. I think one of the keys is to separate the ones that are really good salespeople from the ones who do really good work, because that’s not necessarily the same thing. There are some people who are really good salespeople, and the second you sign up with them, they hand you off to someone that’s fairly incompetent versus somebody who actually walks the talk. So I’ve just summarized my experience with 20 different service vendors over the years, and you can’t be too careful.

Loren Feldman:
Dana, where are you in that process? Did you sign them up to do that 30-day thing, and are they proceeding?

Dana White:
Put it to you this way: We did an onboarding that—and I’m not a crier—but yeah, we teared up. Not because they sold me so well. They are really interested in getting to the nuts and bolts of not the press answer for why Dana started this company, but the Dr. Phil/Oprah Winfrey, lie on the couch, and talk about the reason why. And not putting that on social media, but going that granular to get an understanding. When I’ve looked at some of their Instagram pages of other clients, they’re all beautiful. You just keep scrolling. They’re like Jayson Home, and you just keep scrolling. You see yourself immersed in this picture, like I see myself on the couches or in the living room settings at Jayson Home. We’re starting.

Now granted, this might be another frog I kissed, but these are people who work with national campaigns. These are people who’ve worked with hair: black hair, white hair, they know how to photograph. These are people who also have their own photography and videos, so they’re not up-charging me double what I need to find somebody to come in and take photos. It’s all included in the price. So again, who knows?

Jay Goltz:
So wait, how much are they going to charge then once you say, “I like it”? What is it going to cost?

Dana White:
1,200 a month.

Jay Goltz:
Okay, that sounds very reasonable.

Dana White:
Yeah, 1,200 a month. And then they do other stuff, too. So we’re gonna start here, and then we’re gonna see.

Loren Feldman:
Paul, what’s the next step for you?

Paul Downs:
I don’t know, I’m still stunned by my error. Well, I’m probably gonna do nothing. I’m gonna ask them to do what I would like to do, which would be to just take screenshots of our site, and then redesign it, take out anything they think is extraneous—to show me what a simpler site would look like. And that was not exactly what they offered to do in their follow-up, although I asked my marketing manager to convey that request to them. So I’m not really sure what I’m gonna do.

Loren Feldman:
Are you rethinking your site just because it feels like it’s time? Or was there a problem that you identified that you wanted to address? I guess the question I’m asking is: Are sales okay?

Paul Downs:
Sales are now, we’re on track to our best year ever, and up about 27 percent from last year, but up 15 percent from 2019, too. I don’t think there’s necessarily a problem. But that doesn’t mean it couldn’t be better.

Jay Goltz:
I think the issue that we all have is that none of us think, “Oh, we’ve got this thing down pat. We’re doing it the best…” There are so many moving parts to this that we all can conclude someone out there knows something better than we know. And we continue to look for that. Spending 1,500 bucks makes perfect sense to me. Maybe it could have turned out to be a complete waste of money, but it’s worth it. Because if it turns out to be worth the money, it’s worth a whole lot more than that. This is the world we’re living in. We’re all in the dark trying to figure out our way with this stuff. And there’s always someone that knows better somewhere. The question is: Who is that?

Loren Feldman:
Dana, I want to switch topics a little bit. Even in that conversation when you were concerned that maybe you weren’t quite ready to franchise, you told us that, as you were going through the preparations with your consultant, the numbers were looking really good. Can we talk a little bit about the nuts and bolts? Where do you stand in the process of franchising?

Dana White:
How do you mean where do I stand? Like where am I in the process, or…?

Loren Feldman:
How far along are you? And how much have you figured out, in terms of what this package is going to look like? What are you going to sell to franchisees? And when? And how many?

Dana White:
Yeah, great questions. So I’m halfway through the process. We’re still on track to be able to start awarding franchises in October. I’ve learned a lot, and one of the biggest concerns I’ve had—I had it right when I started. I had conversations with the franchise consultant, saying, “Listen, culture and training are important. And what I’m saying is, there is an element of cultural training in Paralee Boyd that is different than Wingstop, that is different than Burger King or McDonald’s. This is an African American hair salon. This is a cultural thing. There are some broad strokes that we can apply from the franchise consultant space, but it’s going to take having someone who has experience in this world, with this workforce, to be able to execute this successfully.” So I have had these conversations at length. And unfortunately, there’s not much that my consultancy can do for me, because this is foreign to them.

And I understand that, and I don’t fault them for that. But I have had a conversation with them saying, “We need to add a position to my initial franchise team, director of training and cultural immersion, because the culture for my industry is such that it’s kind of do what you want, when you want, and it’s not very structured. I’m changing that, and that is huge. And if we do not address it initially, again, this will be a disaster of a franchise in five years. So it’s not as easy as Chick-fil-A—not to say Chick-fil-A is easy. But just saying, “Well, everybody has a diverse staff.” Yes, but your time with your customer is a lot less than at Paralee Boyd. At Paralee Boyd, you’re with this person for an hour.

Jay Goltz:
Plus, it’s very personal, you’re dealing with their hair. You’re not them a sandwich.

Dana White:
Perfect, exactly. And then you have to look at who’s doing the hair, and you have to acknowledge where they’re coming from and what the industry dictates. I am upheaving all of that. And so their thought was, “Well, why don’t you bring this person on in year two?” No, this training and cultural immersion person needs to be there day one. We can’t be a part of the hiring, but we can train the lead staff, and we can train the franchisees and the people who are going to be operating that franchise on the cultural immersion training that is going to be needed in order for this to be a successful franchise. There are things that can’t go on and there are things that have to happen. It’s going to fit some people, and it’s not going to fit other people

Jay Goltz:
And what you just said is why you’re going to be successful in what your unique selling proposition to this world is. You’re very smart, and you figured this out, and everything you said couldn’t be more true. And the fact that you figured it out before you had a disaster is why this thing is going to work, because it wouldn’t have taken five years. It would have taken five months before you started pulling your hair out.

Loren Feldman:
Dana, you said that this realization has caused you to adjust some things, but you’re still on track to start selling in October? It hasn’t set you back?

Dana White:
No. I have a call tomorrow to look for this person. I know exactly who this person is. I don’t know their name or anything, but I know exactly the qualifications. I know what some of their personal history has to be. I know what their professional history has to be. And I’m reaching out to my network to just start having conversations with people who can point me in the direction to bring on this person, part-time to start, and then who can gradually grow into full-time as we start awarding franchises.

Jay Goltz:
And the beauty is, when you find this person, they’re going to be thrilled to get this opportunity, because they’re trapped somewhere right now that they learned all this stuff, but they can’t be part of an exciting new thing that’s going to change the world. So someone’s going to be very, very excited to get this job.

Dana White:
Yep. I mean, the person I need is going to create a Chick-fil-A, Mary Kay, drink-the-Kool Aid-like culture at Paralee Boyd. We’re going to rally these ladies and these men, and we’re going to bring them into an organization and make it an organization for them, a place to be. It’s almost going to be like this Black sorority-type organization and making them feel like they are a part of something, because they are. And it’s going to be something that is bigger than themselves, because we are doing something that not only is not being done, but we’re solving for a problem for a market that is being overlooked.

It’s groundbreaking, and they’re going to be a part of it. So the person that I’m looking for is going to be the person who puts together the program for our pinning ceremony, that when somebody gets promoted, this is what we do. When we have someone on our team who loses a loved one, this is how we show up for our staff at Paralee Boyd. I will have it. I will have it, and I’m working towards that. Because if I don’t have it, I could just go ahead and go through my franchise process and just start awarding these, then grow it, sell it, and let it be somebody else’s disaster. No, I believe in what we can do. We will do it. And I will have the team to execute it and make it happen. That’s it.

Loren Feldman:
So when you said that the numbers were looking really good on your pro forma, what numbers were you referring to?

Dana White:
We were looking at the projections. We were looking at the fact that I didn’t—

Loren Feldman:
Projections for what?

Dana White:
Projections for when you start awarding these, and I chose to be conservative. Even conservative, the numbers look really good. So if we only have five locations by the end of 2022, I said, “Wow, that’s amazing.” If we have five locations by the end of 2022, going forward to five years, I was really, really happy with how those projections look. I was like, “Oh, this is really, really exciting.”

Loren Feldman:
Do you know what you’re going to sell the franchises for yet?

Dana White:
The initial franchise fee is going to be $45,000. We’re working on the final draft of the pro forma. And those numbers look really, really good.

Jay Goltz:
What’s it going to cost them to build out the space, though, beyond the 45 grand?

Dana White:
I cannot answer that until our FDD is final, until we are legal. But thank you for asking, Jay! Again, all of the legal documents haven’t been done yet. So we can’t release that until we’re licensed.

Loren Feldman:
Are you going to require that your franchisees have a certain amount of capital?

Dana White:
Yes, or have access to a certain amount of capital. Yes.

Loren Feldman:
Can you tell us how much that will be?

Dana White:
I cannot.

Loren Feldman:
Okay.

Dana White:
I can’t say anything until once we get the—

Loren Feldman:
But we’ll be the first to know, right?

Dana White:
One of the first to know, yes. [Laughter] It’ll be on our website. But once we have the FDD complete, I can have those conversations. Right now, all I can share is, “Yep, we’re franchising.” In a minute, you’ll be able to go to our website and put your name in to say you’re interested, but that’s all I can share.

Paul Downs:
Loren, what would be a not uncommon range of capital requirements for franchisees, do you know?

Loren Feldman:
I don’t. I know it varies greatly—if you’re talking about a burger joint versus a massage joint, or whatever it might be.

Jay Goltz:
Or a burger massage joint. [Laughter] Yeah, see, new concepts coming up all the time.

Dana White:
You’re hilarious. You can go on franchise websites, like Hammer and Nails, all that’s public. Dry Bar, you can go on their franchise website and see what their range is. And they vary.

Jay Goltz:
Okay, Miss Franchising Big Shot, can you help us little people out there to explain what SBD is? Because SBD to me stands for something different than what it probably stands for. Can you tell us what?

Dana White:
FDD. FDD is Franchise Disclosure Document, and that’s a legal document. I have my attorney working on that right now to have me licensed. My initial licensing will be in 38 states. We’re shooting to be licensed by all 50 states by the time my process is done, but we may not be, because of COVID and processing times, whatever. I know we’ll be licensed in 38 states when I announce, and part of those states are the ones that I’m targeting to open franchises in first.

Loren Feldman:
All right, I want to circle back to something Jay said that took me by surprise. Jay, did you say you joined a new business group?

Jay Goltz:
I started a new business group with a couple of people from my last group I was in years ago. It’s nine people, and we’re going to meet once a month, and there’s going to be a moderator. But it’s not an organization we’re paying. We’re just going to pay the moderator. You rotate. We’re using the model of many of these places, except it’s going to cost about 10 percent of what it costs to join one of those organizations. Because a lot of the money goes to basically trying to find the members and then the organization. It’s just cost-effective, and plus, we handpicked everybody who’s in the group from just knowing people. So it’s always worth something to see other people’s businesses and see how they operate, and then getting input on your own. And like I said, two of the people are really doing a lot of online business. I’m confident and excited that I’ll be able to get some insights from them.

Loren Feldman:
Have you picked your moderator?

Jay Goltz:
We actually did. There are people out there who do this, and we interviewed a few. We have a woman we’re hiring who has worked for other organizations, who—well, I’ll just tell you—we’re paying her $1,250 a month to do the one meeting, and she’s happy. It’s local. She doesn’t have to travel. We’ll see how it goes. But so far, so good.

Loren Feldman:
How many business groups have you been in?

Jay Goltz:
I’ve been in five or six over the last 43 years. Usually it lasts a few years, and then either I get bored, or the membership comes down. It’s been a problem over the years, because the problem is these moderators make so much money by every member they have in there that they never kick anyone out. They’re all nice people, but some of them are just, frankly, of no use to be in a business group.

Most of the time, they take over a family business, and you get to watch how to destroy a family business over a few years. And you have a meeting ,and you discuss what’s going on there, and you give some input. And then the next year, it’s the exact same problem, and they don’t do anything about it. When you’re paying over $1,000 a month to join an organization and devoting a whole day to it, it gets real old real fast, like why am I wasting my time with this? In a couple of the cases, the group got down to six people, and that’s just not enough people. So I’m hoping that this one will …

Loren Feldman:
Will you make a rule there can be no second-generation—

Jay Goltz:
No, not at all. There are a couple of very sharp people in there who are the second generation who are building the business. And actually both of the people that I’m talking about who are doing a lot of web business are second generation, so that’s not a problem. It’s just when you charge a lot of money for a business group—I won’t mention names—a lot of the people who are in there are second-generation because they’re the only ones who would spend $18,000 a year. That’s a lot of money for a $2 million, $1 million growing business. It turns into a social club, and they spend a lot of time talking about golfing, and that’s just not something I have any interest in spending money and time on.

Loren Feldman:
Paul, I believe you’re spending that money.

Paul Downs:
My experience has been different, and I would attribute that to my group leader, because I don’t think there’s anything structurally about Vistage that would prevent that kind of thing from happening if the leader doesn’t have the right kind of attitude. But it just hasn’t been my experience.

Jay Goltz:
No, it’s about who the leader is. You’re exactly right.

Paul Downs:
Yeah, we’ve had reasonable turnover and people who stayed in the group. I’ve been in the group for nine years now, and I think it’s easily worth $18,000 bucks a month, compared to where I was when I joined.

Jay Goltz:
A year—$18,000 a year.

Paul Downs:
Sorry, $18,000 a year. And some years that would have been worth that per month, but it’s just been a real resource for me. But the group was put together by Ed Curry, and maybe he’s unique. I don’t really know.

Jay Goltz:
Well, and also Vistage is an organization. They provide speakers. I had one speaker who was—and I don’t say this often—life-changing. I learned some stuff from this one speaker that has been extremely valuable over the years. So it’s a different model.

Dana White:
So Loren, you’re the reason why I’m not in a group in a business group.

Loren Feldman:
Because this is your business group, Dana?

Paul Downs:
You are in a group. This is a business group.

Dana White:
Yeah, it’s very close, and that’s a really good point, Paul, that this is a business group. But I was kind of dabbling with the business group thing, and I was like, “Gosh, maybe it’s me, maybe I’m not a smart businesswoman.” Every time I would leave the meeting, I was like, “Gosh, I have something I’m not getting.” And I said, “Wait a minute. If they don’t get it—like Loren got it when I talk to Loren—maybe it’s the group.” And so, that’s kind of been the standard after like two or three or four meetings when they’re still puzzled. They don’t know what to give you, and everything that they’re recommending—no fault of their own—is based on their experience. It takes them a really long time.

They don’t really quite get it. They deal with me as a typical hair salon. And you’re saying ,“No, that won’t work.” And then they’re dealing with me as if my staff is like their staff. “Well, Dana, why don’t you have dueling piano nights?” And I’m like, “Yeah, but you don’t understand.” I found that there’s been a disconnect for me. So I probably won’t go—that’s not true. I plan on joining the franchise ones, once I get established and working with other franchisors. But, yeah, as far as Paralee Boyd, as an owner, I’ve decided after so many attempts to leave it alone.

Loren Feldman:
So we only have a couple minutes left. Would somebody like to ask me if there’s anything new at 21 Hats?

Dana White:
Yes, Loren, it’s Dana! Is there anything new at 21 Hats?

Loren Feldman:
Actually, Dana, there is! I’ve engaged someone to try to sell sponsorships against 21 Hats content, and maybe actually produce some revenue. What do you think of that?

Jay Goltz:
Whoa, capitalistic pig. You’re going to try to produce revenue now?

Loren Feldman:
Not profits, just revenue. I’m only going for revenue.

Jay Goltz:
Okay, good.

Dana White:
How dare you! Congratulations.

Loren Feldman:
Do you think it’s a good idea?

Paul Downs:
Well, if whatever you’re doing prior to that engagement was not producing revenue, then trying something else? That’s usually a good idea.

Loren Feldman:
Actually, I have had a sponsor, as you all know, on this podcast, and his name is Steve Krull from Befoundonline. And he’s going to be sponsoring some more, so it’s not like I haven’t taken in a dime. He’s actually been very generous. But I’ve hired a guy named Randy Davidson, and if anybody wants to reach him and talk about sponsorships, he’s at [email protected] He’s built and sold a number of digital media companies that were aimed at entrepreneurs, just as 21 Hats is, and he’s going to try to do the same for me. We’ve arranged a deal where he keeps a percentage of what he sells, so we’re going to try to build something here.

Dana White:
I’ve found that some of my podcast friends just kind of leave it, and then they’re like, “Well, why didn’t this happen?” Well, there are things you have to do, so if you are doing those things, keep going. And if you’re not, consider starting. That’s all.

Loren Feldman:
What things are you talking about? Maybe I’m doing them.

Jay Goltz:
I don’t know what you’re talking about, but it sounded good.

Dana White:
Promoting and getting the word out.

Loren Feldman:
Let me address that. I happen to be at a business conference right now. I’ve written about it in the Morning Report. It’s the Tugboat Institute Annual Summit. It’s a group of companies that believe that you can build a business to last 100 years, and that’s what they’re trying to do. A big part of it is not taking private equity, not taking venture capital.

I’ve found podcasts are a little bit of a tough thing to sell. It’s not like clicking on a link and reading an article. It requires an investment of time for someone to decide on, and nobody’s looking for new ways to waste time—not that I think this is a waste of time. But if I corner somebody, and I talk to a business owner and I explain to them what this podcast is about, I get really positive reactions. Actually, there are quite a few people here who are helping me sell because they’re already listening to this podcast. But it’s challenging. If I could talk to everybody in our target market one-on-one for 10 minutes, I could build this podcast. I’m not sure how to do it without that opportunity.

Dana White:
So that’s it. You’re doing it. There are people who aren’t, who have a podcast, and they don’t have a Morning Report. They’re not really talking about it, but they brought somebody on to do it for them, and it’s just not the same. So that’s great.

Loren Feldman:
All right.

Jay Goltz:
Did we forget to say, “Jay, what’s new?”

Loren Feldman:
Jay, anything new with you?

Jay Goltz:
My CFO of 22 years, who’s 64, has decided to retire. I need to go find a replacement, which is a pretty big game-changer after 22 years. The company is much bigger than it was when I hired him and has far more technology needs now. I’m looking for a CFO who can oversee the accounting and oversee computers, which means we’re gonna have to upgrade stuff and change things. So it’s gonna be a new experience.

Loren Feldman:
Are you hiring a recruiter?

Jay Goltz:
No, not at the moment, because I want to write a really good ad talking about our company culture, our mission, where we’re going, how we’re going to get there, and see if I can attract somebody who says, “Wow, this is the kind of place I want to work.” If that doesn’t work, I’ll go to the recruiter route.

Loren Feldman:
Can they work remotely?

Jay Goltz:
That’s funny you ask that, because my HR person asked me about that. I’m not making that one of the top five things. I don’t want to push that because I would just as soon they not, but I’m not going to make a blanket, “No, you can’t work from home.” But if that’s their number one concern, they should really work somewhere else. I want someone who wants to be here who wants to be involved with everything.

Loren Feldman:
I was expecting a flat, “No.”

Jay Goltz:
Close, but no, I can’t say no.

Loren Feldman:
My thanks to Paul Downs, Jay Goltz, and Dana White. As always, thanks, guys.

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