Creatives Grab Coffee - Transitioning from Generalist to Specialist (Ft. Umault) | Creatives Grab Coffee 69

Episode Date: August 15, 2024

Guy Bauer, founder of Umalt, shares his journey from a generalist video production company to a specialized niche agency. He discusses the challenges of choosing a name for his company and the importance of filling a brand name with meaning. Guy also talks about the downfall of his previous production company and the lessons he learned from it. He emphasizes the need to specialize and dominate a niche in order to stand out in the crowded video production industry. He advises against relying on a single whale client and the dangers of pre-billing without doing the work. Accepting pre-bill payments can have negative consequences for video production companies. It can lead to tax liabilities, financial strain, and a loss of creative control. Pre-bill payments can also result in clients changing their project requirements or using the funds for unrelated expenses. It is important to have a clear contract in place and set expectations for how the pre-bill funds will be used. Additionally, it is crucial to say no to bad clients and establish boundaries to maintain a healthy working relationship. In this conversation, Guy Bauer shares insights and experiences about running a video production company. He discusses the importance of having a strong team, finding the right clients, and managing budgets effectively. Guy emphasizes the need to trust your gut instincts when working with clients and to focus on your unique strengths as a video maker. The conversation also touches on the challenges of balancing creative and operational responsibilities and the importance of maintaining healthy profit margins.Chapters00:00 Choosing the Right Brand Name05:27 The Downfall of a Generalist Video Production Company10:45 The Benefits of Specializing in a Niche14:48 The Risks of Relying on a Single Whale Client22:01 Transitioning from Generalist to Specialist30:41 The Game of Pre-Bill Payments36:02 The Negative Consequences of Pre-Bill Payments43:39 Setting Boundaries and Saying No to Bad Clients57:06 Working with a Spouse in the Business59:41 Finding the Right Clients: Trusting Your Gut Instincts01:03:30 Balancing Creative and Operational Responsibilities01:08:03 Effective Budget Management in Video ProductionSPONSORS:Canada Film Equipment: www.CanadaFilmEquipment.comAudio Process: www.Audioprocess.ca🎵 Spotify: https://open.spotify.com/show/2vHd8BdbkMQITFZmDJ0bo9🍏 Apple: https://podcasts.apple.com/ca/podcast/creatives-grab-coffee/id1530864140🎞️ Produced by LAPSE PRODUCTIONS – https://www.lapseproductions.comTo learn more about the show, visit: https://www.creativesgrabcoffee.com/

Welcome to Creative Scrap Coffee, the podcast on the business of video production. Creative Scrap Coffee is hosted by Dario Nuri and Kirill Lazerov from Labs Productions. Our goal is to share knowledge and experiences from video production professionals around the world. Whether you're a freelancer looking to start your own business or a seasoned business owner aiming to scale your company, this is the show for you. Join us as we develop a community of like-minded creatives looking to learn and help each other grow. Welcome to the business of video production. Welcome to Creatives Grab Coffee. Before we get started with the show, let's go over today's sponsors. Do you have a shoot in Toronto?

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And now, let's begin the show. Starting on a high, okay. Hi everyone, today we got Guy Bauer from Umalt. Guy, welcome to the show. Thanks for having me. We were just talking before we started recording about the names. I thought for years it was Umaltz, but apparently I found out just like a minute ago it's Umalt. Umalt, yeah. It's the umlaut is that U with the two dots that makes the U sound. But yeah, it's when I was changing the name,

I actually had a consultant, David C. Baker, who was guiding me through this whole rebrand that I was doing. And I said, hey, what do you think of Umalt? He's like, it's a terrible name. It's hard to spell, impossible to pronounce. And I didn't listen. And yeah, it is a ridiculous name.

Like people think we're umlaut, right? Like it's umalt. It's a play. It's just the worst name. It's just the worst name. How did you even come across? Like how did you come up? Yeah. What is it?

I didn't actually come up with it. We used a design agency and I said, hey. Be weird. Here's what I want, like our whole vibe to be. And they came up with it. And so my philosophy on brand names is that you fill the brand name with meaning. You know, the brand, the name actually doesn't really mean much without you

filling it with meaning. Yeah. Uh, but basically it's an app. It's a, it's a play on umlaut. doesn't really mean much without you filling it with meaning. Yeah. Right. But basically, it's an app. It's a play on umlaut. The umlaut is the you with the two dots. So we're umalt. And it's kind of just like, hey, you look at something and we're just kind of twisting

reality a little bit. I don't know. That's like the post-rationalization of a crazy name. You know what I mean? You got to come up's like oh my god Yeah, that's exactly like how we did it with our name cuz we yeah We came up with our name being something really it just sounded cool And it was the only thing that sounded different back in 2014. We wanted to get just laps

You know laps calm but that was taken so we had to add productions to it And then even how we came up with labs it was from a short film get just LAPS, you know, LAPS.com, but that was taken. So we had to add productions to it. And then even how we came up with labs, it was from a short film. I was working on called relapse and I was like, Oh, you know, it sounds cool. It's just laps. And I didn't even know just called laps. It wasn't relapse. It was just laps.

I don't remember. It was just, was it just laps? I think it went through a couple of name changes. And then if you think about the name for the longest time people are asking us about it, like we would have to fill it in like, right. Okay. What those laps mean? Like a lapse in memory.

We're like, okay. So like the videos are so good that like you don't notice the time that passed. Exactly. And then, but that was this, that was like our like on the spot, like elevator pitched. But eventually, a couple of years back, a couple of years back, we finally came up with a better one. I came up with it after we after Carol's New Year's Eve party. I'm I'm lying down in bed like drunk and I had this I just had it come to me.

I was like, LAPSE. I'm'm like we should do something with the letters. So lasting amazing pictures sounds and experiences I'm like, this is so good I was like I was like I'll tell Karel tomorrow morning about this right and I'm like I'm about to go to say I'm Like wait, wait, wait, I'm gonna forget I have like the memory of a goldfish. I'm like, right? forget. I have like the memory of a goldfish. I'm like, right. Right. That's our modern one. And that's what creativity really is.

I mean, it's it's coming up with a crazy idea and then having to like post rationalize it. That's like what we do. That's what we do. Now, working within certain boundaries or creative boundaries as well. It's like, all right, we're kind of stuck with this name. What can we do to make it really good? Cause we all know rebranding is a whole pain in the ass.

Like, I mean, luckily we're all very small businesses. So it's not as hard as like, say a bigger company is, but just even the process of like, say you had to just, like, cause I've always wanted to even like tweak the logo just a little bit, even just a little tweak. Then you have to update it on every single social. You have to get it in the right format size. You have to, you have to export it in certain, certain settings for certain websites. And it's just, it's just absolutely crazy to do that. Not to mention the videos, all the promo videos.

We were thinking of changing the name a while back, but then we went, we were trying to come up with different names and we're like, all stink and not to mention the urls aren't available either yeah yeah yeah that was the other reason why the agency liked umalt was that it was available because it's just a cockamamie name but you know like it's a six-letter word that was available.com you know when does anytime anytime a company is trying to say like, oh yeah, this is our name. We chose it because of this. It's like, we all know that you spent hours on godaddy.com testing to see if that URL was available or not.

And that's the only one that was left open. Day by day, it gets even harder. It gets even harder because more and more people are taking URLs here and there and yeah. But anyways, let's get into a little bit more about like the company behind the name. So tell us a little bit about Umalt. Yeah. So Umalt's been around since summer 2019 and it came after essentially the downfall of my previous production company called Guy Bauer Productions which is a little like you know what's the word where actually there was I'll never forget this moment I had a huge sign in lights for our office called,

and it said Guy Bauer Productions, or it said, with our logo on it, right? And we were leaving the office. I had to get rid of it to shed expenses. And I was going to the dumpster to throw stuff away, and I saw the sign, like my name though, in the dumpster. Oh my god. It was just, yeah, so humiliating.

It's so, it was, I can't describe it, but it was all self-inflicted. So Umalt came out of the ashes of Guy Bauer Productions. I started Guy Bauer Productions in 2010. I had always been into radio, TV, film, just kind of an AV guy. I'd been making videos since the seventh grade, got into a couple TV shows in the early 2000s and then moved on to producing a morning radio show.

But video was always my hobby. It's what I did with my friends. We made goofy music videos and just stuff to be funny and stupid. And I lost my job in the Great Recession of 2009, sent out like a hundred resumes. Didn't I didn't even get to do an interview. I didn't even go on one interview. It was really bad.

And in January 2010, I was at Barnes and Noble and there was like a money magazine and the title, the headline was, How to Make Money in 2010. I was like, yes, all right. I knew that. I remember those articles. Yeah, right. And there was this little thing about if you have a hobby, you know, you can go on these freelance websites back then. It was called Guru.com and Elance.com. Elance.com turned into Upwork.

And you can go get little freelance things. So I made a profile and my first gig was a $50 puppy video edit back in 2010. And edited this guy's puppy videos and he wrote like a five-star review and then I used that to go get a $70 job and an $80 job and my whole intent was just to supplement unemployment while I look for a job but then eventually just it just kind of snowballed and there it went and I was on my entrepreneurial journey and proceeded to just make every dumb mistake I could unintentionally, but just business wise, creative wise, client management wise, just have stumbled through

the last 14 years. Anyway, so that kind of culminated in 2018 where I had 32 full timers and was just on a downward spiral of taking on unprofitable work to meet my salary demands and then needing more people to do the unprofitable work. And it was just like this rock and a hard place because I couldn't, it was all unprofitable work. It was all like terrible, terrible work.

My workforce was totally demoralized because the work we were doing was just complete stink stuff. Just totally like the clients were terrible. was just complete stink stuff, just totally, like the clients were terrible. And then I was a nervous wreck at 32 people, I had a payroll that I can't even believe the payroll we had. That's insane. And so I'm freaking out, and so, you know, I was a terrible manager, and yeah,

and that kind of just all crashed in 2018 required to do two rounds of layoffs and basically dismantle what I had built and Eventually just come to the realization. I went to a Panera And spent a day there and I was like, alright, dude, you got to just figure this out today and just took a booth and and tried to Kind of square this whole thing of like well, I know that Like I'm good at video. I know that I stink at business But I'm good at video and I just tried to like put this whole thing together and we brought in a consultant named David C. Baker is he the guy from to is he the guy from two Bobs?

That's what I was gonna ask. Wow, so So that was the best money I've ever spent ever actually because he essentially saved my like not life but like saved my business or my like line of work that I do and and that was Umalt. Umalt was like all right I'm done making I'm done letting clients drive because when clients drive, you end up making corporate videos because they don't know creative. It's not because they're evil or mean or anything. They just don't know what they're doing. So the old self would let clients drive and the new agency is no, no, no. Like, you know, you don't go up to the pot to the cockpit when the planes landing and go like can you? Go to the left a little bit more like you don't they don't get to do that Passengers do not get to do that and my resolution was like no no I'm the pilot you sit in the back and I'll get you where you want to go but you have to sit in the back and that's kind of what room alt is is like just let me drive, please and

And that's it. How can you say you're bad at business though? Cuz you went from like just starting out to 32 and 30 plus employees like that That means you're you must be good at business. You know what I mean? I think I'm good at selling and I think I'm awful Like if you actually look at the numbers the amount of money that I lost is kind of mind-blowing Because there's you know, there's I think there's sales and then there's like what you do with the money And how you use it and how you deploy that money And I think here's the thing. Am I good at business now?

Probably a lot better than I was 14 years ago. So I think that's, but one of the reasons why we had such a huge disaster in 2018 was fundamentally because I had no idea what I was doing. Every time we hired a new person, we became a new company that I had never managed before, you know? And I didn't know the dangerous waters I was heading into every time we grew the company.

And what would you say was the danger? Like every time you added another person? Was it like you didn't know what you were hiring for? Like you were hiring without a plan for the hire necessarily and how that would impact your business? Biggest, the biggest, the best way I can say it is this, is, how can I say it? I would be in temporary pain because we would oversell.

So I would oversell because I couldn't say no to any opportunity. My internal goal was to, I don don't know be a billionaire or something I don't even know just to be the best to win video production just win the game And so I said I I didn't say no to anything I just said yes like for any amount of money as well And I didn't understand that well if you sell a job at X, you can't spend X plus 10 to make it. You have to spend like half X to make it. So I had no financial controls

on cost accounting and I would just let top line thinking take over. I was very top line driven. I was very, um, if you've ever read the book, profit first by Mike McCallow, it's, he talks about managing your company through the bank account. So I would look in the checking account. If it had a lot of money in it that day, I'd be like, oh right, I've won business. I'm great at this. Let's invest something or buy something.

And then if it had no money, I would be like, oh, we're going out of business. And I was very public about this too in front of team members and just everybody, like just a complete disaster of management. And that's what I would say is like it was this, and then eventually got into this thing where I had to feed the beast. Like I had all these people and, and they did nothing wrong. They were great. They're all doing great things right now. But I just had to take on whatever work to meet payroll. And then that was completely unprofitable. It required way too much labor, which then required me to sell.

How was it at the beginning when you were hiring people? Because again, you ended up with 30. But how was it early on when you're adding like your first couple employees yeah and that's essentially where I made the mistake there was two paths that I took back in I saw I hired my first employee in 2012, and the way I see it is that was a fork in my life. And I took this way, and essentially in 2019, I was like, whoop, that's bad.

I like walked all the way back and then took this way. So basically, the bet I made, or the decision I made was, okay, I'll never forget this. I had so much work in 2012 that one day I started crying in the shower. I was just so overloaded. Um, and I was like, all right, I need someone, I need help. And so, yeah, this fork in the road to the right that I took was, um, I'm going to hire someone to help me, but keep the prices the same.

And that was the major flaw that actually from 2012 to 2018 set me on that course. And what I did in 2019 essentially was walk back to that start and I went to the left and I said, I'm not going to hire anyone. What I'm going to do is manage capacity through pricing So instead of keeping the prices the same and just taking away from profit by adding Labor and people I'm going to raise the prices so that the job volume goes down and Essentially just get managed my capacity through Through making it harder to stay to what was the advice that David Seabed? He was like you're a month away from bankruptcy.

He was like shocked at how awful it was. He was like oh my gosh dude, what are you doing? and he gave me this kind of ten step thing and I still have it but He was like, oh, yeah, you have a chip sale I was trying not to lay anyone off and he was like, no, no, that's that's not gonna happen. Like you have the cards Yeah, like yeah, and So that was it. But then he was like you have to You have to specialize you cannot just be a video like guy Bauer productions was we'd make a shoe video

next to like a thing about the fourth Industrial Revolution and digital manufacturing and design next to a Thing about like a new Kickstarter video next to a music video with generalists right but we're like most of us feel like that right just do video production we jack of all trades basically exactly yeah totally generous yeah and the I mean and and I can still do I think I can still operate in kind of any realm, but his whole thing was, you know, you wanna have, and this is where Blair ends

and him see eye to eyes, you wanna have the fewest amount of suitable replacements for you. So if it's a, like we used our bread and butter back in the day was those conference videos where like an event recap video where you go You do the time-lapse of the room filling up You put a couple lines of the speaker then you show people like eating the food with their name tags and Cool, you try to make it as cool as possible, but it's an event recap video. Well, it's straight thing is is I

can't demand a high price for an event recap video. Well, it's straight forward. Yeah. Is I can't demand a high price for an event recap video because everyone else can make an event recap video. So it forces you to compete on price or just wanting it more than everybody. So meaning you're going to over serve, you're going to do what you're going to bring in like a drone and like this and that. And the other thing is that little did I know that all this equipment I had, I thought once you buy equipment, well now you could just use it for free. It's free. So what does it matter if they're not paying us to use the gear? I already bought it, but the equipment is depreciating.

And basically all of these balance sheet and boring accounting things caught up with me In 2018 where I just couldn't over sell myself out of it Like I couldn't I was always relying on like I could just get more sales and more sales and what happened was is yeah eventually Companies started in housing. They started building their own production companies that made crappy corporate videos. They're like, why would we pay you? Let's just build a whole production team that makes the churns out this crap. And, uh, yeah. And that's what happened.

So he was like, you have to specialize. You have to dominate a niche where. Where if the client doesn't want to pay your price, they try to Google like, you know, replacement for company that can make a funny B2B thing about a complicated topic and there's not many competitors. And that was his whole thing and that's where Umult came out of. From what you're explaining, like I see that in the about video that you guys have on your business.

I've never, it's been a while since I've seen a video production company have a very concise about us video that's 15 seconds that very creatively shows what you guys are all about and how you niche yourselves and I love that little tidbit where it's like, that very creatively shows what you guys are all about and how you niche yourselves. And I love that little tidbit where it's like, stop doing typical corporate videos like John in the back. John, what are you writing on the board?

I have no idea. And that just resonated so well. It's like anyone watching this is gonna automatically buy into who you guys are as a business. It's very difficult for video production companies to kind of stand out like that. And this is why a lot of them are also generalists because you're in a state where you're constantly fighting

for new business and if something's coming your way, it's like, here, do you wanna do this event recap video for four or $5,000, right? If nothing's happening in that month, you're not gonna say, oh no, I'm a general, I have a niche, I'm not gonna do it, right? It's hard for a lot of companies to kind of say no to business like that, right?

So like, from what you've learned now doing the generalist approach, and then now going into the niche approach, what is like probably some advice you would give a generalist company in terms of like what they should start doing next or thinking about? So what's interesting is I feel like sometimes I, when I'm up at night, I'm like,

if I could go back to 2010, would I start with our positioning right now? And maybe the answer, I think most likely the answer is like that would be a gigantic mistake because you have no idea what you're doing. And there's no, it's impossible for you to come up with that positioning anyway. So I feel like the generalist to specialist

is actually a very natural organic career path. If you think about it, you know, I started as a PA, a PA, you're a complete generalist, you're like, one day you're in the art department, one day you're with crafty, the next day you're with talent, camera team, like next day you're pulling focus, like, they'll use you in whatever way and it's a great way to figure out. What do you like and you know? Where do you want to be and then cut to that PA 20 years later? I guarantee you they're a department head in whatever department and they've learned to specialize So I think going from generalist to specialist is actually there's no rush I think it has to happen within you but I think it's something that you should be aware of. Like, eventually you will need to make the difficult decision because do you want to be, I'm 42, do I want to be doing event recaps at 42? The answer is no. Like, I don't want to do that. And there's nothing wrong with doing event recaps. If you like it, then.

You know, you'll be great at it. And if you keep doing the same thing, you'll get like, you'll truly be a specialist. So there probably is some event recap company where they're like, that's all we do. And no one can touch our creativity. We we've seen it all. Like we know we can anticipate every little movement and all that stuff. So I forget your question, but I would say like there's no rush to specialize. I would just say just be aware of kind of what you're good at. And that's where I came out as.

Like, I was like when I in that Panera booth, I was like, okay, I think you're really good at funny things for really like unfunny industries or like things that don't get funny material, you know, that can't have access, don't have limited access to funny stuff. And that's kind of where our positioning came out of. But I could only do that after doing all of those hundreds of videos. Yeah, you really nailed it on the head. And you just said something that I think a lot of video production professionals need to hear is that there's no rush to have that specialized company. And like Dario and I in the past have even ourselves tried to think about, it was like, oh, how can we niche down like based on what we've done?

But then we realized, oh, we haven't done enough of this to really niche down, which is one of the big factors. It's like, you have to do enough of that niche before you fully niche down in order to understand it. Cause you have to understand what you're moving your business into. You can't just say, I'm gonna become a product video production company.

That's my only specialty. And why? Because you've done one product video. That doesn't mean you know everything. Why is someone gonna come to you? Are you getting enough inquiries to do products where you can just fully just focus on that? Exactly.

Yeah. Well, I'm wondering though, it's like, if you haven't niche down, it's hard to get that much of that one type of consistent, how do you say, inflow of leads. Like maybe once you've done enough, then you can kind of focus on it more and pitch more to those types of clients and leads. Maybe then you'll get more leads. But like you guys said, like you have to have enough experience in the industry, tried many different things

to understand what you wanna focus on. If it even makes sense for you, what are you good at, right? And sometimes it's not a matter of also like a specific type of video that you do, it could even be certain industries that you're really good at. Like you really understand, say, the manufacturing industry. You really understand the finance industry.

Like I know there's like one or two video production companies that are really good with working with nuclear power plant companies. Like that's a lot of the video content that they do because different industries need different kinds of videos Versus other ones right it's like one might need more promotional videos others might need more Social media videos it it really does also a difference girl between really just have to go through the motion Like you mentioned getting their power plants stuff you can decide that and just having that one whale client

And that's why you just do all those types of videos. That's also a distinction. Yeah, yeah, I'm just, I'm making, yeah, I'm just using it as an example. But that's the other thing. That's actually a good point you're bringing up, is like, be careful of that pitfall where all your business is one client. That doesn't make that your niche.

You know, it's just you have one client that does all that. And there are a lot of companies that build their businesses based on that. And that's how they grow to like a big team. And then if that client leaves, then their team gets decimated. Like Guy, did you have that kind of with your previous business as well,

where you had like a whale client that helped you grow? Or was it like a lot of like medium or smaller companies? I'm like you're you hit it man you hit it you struck a nerve yes we did have a whale client here's here's the other huge thing that the other gigantic mistake I made was the whale client every so many months or every year would go hey we want a pre-bill I didn't know what that was there can you send us an invoice for a hundred thousand dollars and I was like yeah sure I can I had no idea but what they were do is basically like getting budget off their books they

don't use that budget next year but what I would do is basically like getting budget off their books. They don't use that budget next year But what I would do with the hundred grand is I go well This is a lot of money and they're gonna have a lot of work for us. So I better hire to anticipate The influx of work, but they would never send us the work It was just like free money like they would never just trying to get it off their books. And we were essentially a bank. Oh my God. So you got free money and spent it on people.

Just that's it. And to anticipate the, you know, the work coming in, I was, I was, I'm telling you, this is what I'm saying. Like I was here's, here's how I describe myself. Like I'm the worst board game player. Or like, because I think very in the moment. I need to play poker with you, man. You'll go all in in the first hand.

This is great. So I... Yeah, yeah. All in. We don't even have our cards yet. I'm all in. He would be interesting as a poker player, actually. Every time. I actually play like that. I'm all in he would be interesting as a poker player actually every time I

Actually play like that I play blind a lot of times what I do is I don't even I pretend to look at my cards Cuz I'm like well if I know the cards. I'm not gonna have courage So I'm not gonna look at the cards, and I'm just gonna like play people and just bet like I have pocket aces anyway, and so Yeah, and so people and just bet like I have pocket Aces anyway. And so, yeah. And so now I know, and maybe you guys know this, I didn't know this is that pre-bill is not revenue. You have to do the work before you recognize it as revenue. I was a very, because where I came from, I was very not, not I was I went from mom and pop companies to this gigantic whale overnight and mom and pop companies when they give you

The deposit you do the work and then you know The the cycle is like six weeks eight weeks, whatever But then when this whale company came their cycle is like years Uh, we still have pre-bill on our books all these years later But then when this whale company came, their cycle is like years. We still have pre-bill on our books all these years later. Oh, yeah. So that was a gigantic mistake. I treated that as cash and I didn't understand that.

How long does a pre-bill last? Like, is it usually like a one year term? Or no, it keeps going Yeah forever Well, that's the thing. That's the difference. What was the contract and a pre-bill a pre-bill is just an invoice and You just have their money and oh I don't know that you can't okay Like it's not like a retainer where every month you chew into it for $10,000. No, no, no, it's just a gift card.

It's a gift card, essentially. Yeah, that makes a lot of sense. But you didn't do a contract with that? They just gave you money, and the understanding is that it's forever. What happens if that whole department leaves? Or fizzles out? What happens? It's happened across many companies actually. There isn't just one. This is like a game.

I'm not going to name any names, but this is a game that everybody plays. The big companies play is they, cause they don't want to lose their marketing budget for next year. So they get it off their books this year and essentially it's a gift card and what going back in time what I would do now and the by the other by the way the other shit we just did that recently any client wants to free bill do not accept it I'll tell you another bad side effect of accepting pre bill we just luckily it's a small amount so it's not like a lot so I'll give you so many bad things about accepting pre-bill the biggest one at least I know you're in Canada, but in the United States they tax you on profits

So if you accept fifty thousand dollars of pre-bill and then don't do any work and you just Okay, you're gonna get taxed on fifty thousand dollars profit. That's what the government sees as profit Profit at least in the United States is taxed at 50% so they gave you a $50,000 they bought a $50,000 gift card of which you have $25,000 left to do the work meaning like you're now like you know you forget about taking any money for your agency you're just basically doing this job for free the The other side effect is this. Oh my God. Don't do it.

I'm just telling you the pre-bill, it's because you're like, there's so many times when you run a video production company, you're like starving. You go through seasons and if some client comes around going, hey, pre-bill, you're like, yes. What if, what if in your contract, it our contract that put in a clause that says, you know, if it's been this many months and nothing's happened, then this thing's forfeit and we keep everything. Oh, okay.

Okay. Then we're good, Carol. Yeah. And that's brilliant. Yeah. Cause that, yeah. Then we're, yeah, we're good. Okay.

Yeah. Yeah. So that, yeah, then we're, yeah, we're good. Okay, yeah, yeah. So that's the thing, it's like, when you said they pre-billed you, because I thought doing a pre-bill, you should still have a contract in place in terms of like what that money is gonna be allocated so that there's an understanding. It's like, this is what it's gonna be used for, for certain work that's gonna be done

for the next few months or the next like year or so. If it's, I think in your case, what you're, just to clarify for the next few months or the next like year or so. Like if it's, I think in your case, what you're, just to clarify for the audience is that giving, getting pre-billed with any, without any set projects, deadlines, goals. So you didn't have a contract, it was just like, you send them an invoice, they paid it like that? It just opens you up to so much liability.

Okay. That's it. And we had a statement of work with like a kind of essentially like an understanding that we figure this out later. And that's the other side of bad side effect of pre-bill is that the team who pre-bills you, they say, yeah, we want to make this cool thing about like spaceships. Right. And you're like, yeah, I'll do that.

By the time they use it a year later, they're like, oh, no, I remember that spaceship thing and that cool thing. No, we just need explainer animations and we want like 50 of them. Or a lot of times they'll go, can we use your pre-bill? This is another bad side effect of pre-bill. What? We use your pre-bill for you to pay a different vendor? We don't need a video, we wanna buy signs.

We wanna buy signs for an event. So you know how we gave you $50,000? We want you to pay that 50,000 to just pay this other vendor for us. Not only has it happened, it has happened to other agencies I know. It's not just me. That is so illegal.

What do you think about it for that business? It's not actually. It's like, it's just- It's not? We're the doves. That sounds, yeah, that's bizarre. I never knew all this stuff. People are like, huh, yeah.

You know? Jesus, they must- Or at least I am. Just don't do it. It's a bad practice because the other thing is it's almost like Becau- like and then it's like this it's like a slippery slope of Because they gave you money last year now They're gonna give you money the next year because they didn't spend enough from last year because they yeah

And and it like they just Need to keep giving you more and more It's a never-ending cycle of you know the money as a bank Yeah, they're like something I'm thinking of her laws about holding one gets brought up the fact that you don't do retainers because they Don't want to take on like the the depreciation cost of the money itself right because it loses 2% Should lose 2%, right? So right off the bat, if they're giving you 100K, you're losing 2% of that every year.

And if it takes them three years to do it, like it cuts into your profits at the end of the day, right? But- It's too grand. Oh, I haven't made a dollar off of any of that pre-bill. Zero. That all of it was a complete curse and a distraction and, you know, and again, I only have myself to blame because I didn't know what I was doing, but that's still no excuse.

So I mean, but you learned I would just avoid. I've learned. You've learned and you're warning. you now, please don't do it. You're warning other people. There you go. That's the whole point of why we're having this discussion. It's like we're taking our experiences, explaining like, this was a big mistake, don't do it.

Because Dario and I, we were thinking about, we technically want pre-booked work or pre-billed work, technically. But although we were thinking, obviously, probably a contract needs to be in place at the I didn't know I would go in like, we didn't know that was also an accepted practice. That I didn't know. The difference or we did was like, like, number one, that's why I keep doing this

going forward, like everything was defined going into it. Like we knew what the project was and I put all the details on the contract and our contract also has like a clause saying like, you know, but that is mostly if they stop communicating with us and we don't know what's going on. If it's been a set number of months, then cut the core type of situation. But wow. Okay. This I'm putting this as one of our commandments. Never accept pre-build. Yeah, nope. But even with the contract, you're like what if that thing takes forever to do? Like what if it's like out of the 100k, they've only used up 40 and now they're still 60 and

sure they're still keeping in touch with us. So you can't use the huh? But you had the timeline. You had the timeline. It's like, I think the only way where pre-bill will work is like, okay, we can accept this pre-bill as long as there is a clause where it needs to be used by this state next year in terms of work.

Otherwise, otherwise, if nothing is used by that point, it's been forfeited because at that point, is they're getting the advantage of pre-billing, but you're also, but also there's a stipulation. It's like, it's not, you're not doing it without some kind of consequence where it's like, you've committed to 100 grand. You're gonna, we're gonna work on it, we gotta use it up,

and it's gonna be based on our pricing and how we bill based on these things. So you're gonna come to us with a project, we'll tell you how much of it gets used up, right? Because it's like, we had one guest before from the US also who, it was kind of like a retainer where they basically got a pool of money of 100 grand for the year, and then they just kind of depleted it

over the course of the year. That's how they did it. And that's the only form of pre-billing, which I think legally and safely works for everyone. But it's kind of, yeah, but that's kind of like a retainer, right? But it's like, when you break it down, that's like really the only way

that makes the most sense for it. Like if you're just blindly taking pre-billing, it's like, yeah, sure. Here's an invoice. Thank you. How is it like also like in what world is like that understanding where it's like that can be used for the next 10 years. It's like, but I don't know.

Such a mess. Oh, there's so many tricks. There's so many tricks that companies use. And like I said, I'm not the only one. many tricks that companies use. And like I said, I'm not the only one. And the other thing about pre-bill, even if you have a contract in place, a lot of times what they'll do, cause I started doing that. I said, you have to use this or else, you know, you're good. I didn't say I'd take it all, but like we're going to charge you a fee or whatever. But a lot of times they,

then they learn to bait and switch. So they, you know, they come presenting some thing and then at the 11th hour change that thing around and they still haven't broke the Covenants so it's just like you know how I'm big Dave Ramsey fan Dave Ramsey says under no circumstances everyone always tries to call his show but like can I get a car on debt if this circumstance? And Dave Ramsey's like, just no, no. There is never a good circumstance for buying anything on, you know, debt except a house.

And that's how I see pre-bill is like, mm, I just would never, ever, ever touch it ever, ever under no circumstance. It's a siren song. It's, I'm telling you you it's getting you to go overboard And it's a it's just awful And then the other thing is now you're turning into something where you got ledgers and you gotta like, okay like you had this now we're deducting this and then they get mad when you deduct something because

Now they have to like go Their boss is gonna yell at them. I'm telling you, it turns it into a thing that, and you're like, I got into this to be creative and make videos and now I'm in Excel, like, you know, looking at interest and stuff, like, come on, now, just know. I didn't even think of it from that,

I didn't even think of it from that aspect where, like, even like say you had that pool of money that is dedicated to work and then they'll ask you to do something so then you take those billable hours from the pool. It's like, wait, wait, wait, shouldn't that be just something quick or included? Why are you taking it from the pool? It's like, oh my God, I didn't even think of that conversation that might happen. One of our clients finds some graphic design agencies because I've been meaning to do that for the business anyway so I was just like yeah sure I'll help you out with that and One of the agencies was pitching

Because I was in their sales meetings after I connected them and one of the agencies was pitching retainer right for their design work and I was talking to the client afterwards and She doesn't like retainers. I was like, oh how come because I thought would fit like what you need and everything she's like no because they did it with a PR agency already and They then like how on their end they have to keep track of all the hours and then they would ask them like a quick Question and then they would get you know charged for it. So she brought that up. She's done like getting charged for it Yeah, which is like it should have been like something simple. I can't believe like the charged for it. So she brought that up. She doesn't like getting charged for it. Yeah.

Which is like, it should have been something simple. I can't believe they charged us for it. Oh. Yeah. Absolutely. It turns you into like an hour counter, which is like what? I don't get into this for that. And yeah, exactly.

There's so many side effects, so many consequences. But I can see, but you can see why it goes into that stage. Like it makes sense. Who are you, a lawyer? Yes. Yeah, yeah. It makes sense. It makes sense because that's the kind of,

that's the kind of business relationship that turns two parties in, right? Where it's like, how else are you gonna track the work, right? Because it really is, it's like a unit of measurement, right? Once the money has been paid, what's the next measurement?

Hours, essentially, right? It's like a different form of currency. Well, I'll tell you what, what I used to see when a client would give me money I used to see that as yes, we won. This is sweet money I used to see that as now like I used to see it as like a Huge win like a total asset now when a client engages us and that money comes over It's a liability actually because it's it's a liability actually. Cause it's a promise. It's like, I have to do this work to a certain standard. All the pressure is on me.

As soon as that money hits your bank account, you have to treat it as a liability until the job is complete. Once the job is complete and the client's happy, boom, asset, you won. Only when it's complete. We used to have a bell at Guy Bauer's production when a sale was made.

We'd ring the bell. Ding, ding, ding, ding, ding, ding. Yeah, sale, sale, sale. That was the win. Boom shark. And then post David C. Baker, the bell was only rung when a project was delivered, because that's when you actually make your money.

You don't make any money until the project is delivered, clients accepts and says, great job. And that was a huge lesson I learned. And that's why pre-bill is terrible, because how many months or years is it until you get to ring that bell? And every month, every day is a liability. It's just sitting there. It's promises that you don't even know when they're going to be able to ring that bell and every month, every day is a liability. It's just sitting there. It's promises that you don't even know.

We're very similar to you in that sense because when we first started out, it was, in life. So yeah, they said they wanted to go through with us. Great. We got the project. And then it got to the point where it was like, let's get the contract signed. And then that means we got the project. And then it got to the point where it's like, contract has to be signed and deposit

has to be sent before we get the, we, we say we got the project. And then it got to the point where it's like, contract has to be signed and deposit has to be sent before we say we got the project. But to his point, it's not like, he was treating that deposit and the contract signing as the bell ringing, right? But he's saying it's not until it's done. And that's kind of how I always think about it too. It's like until the final video is delivered,

then I go to Dario, I'm like, all right, project is done. How much are we making off this? The markets are always good though, because we go into it knowing exactly what we're making. And usually the second deposit is for that. I'm always like, great, we got it, money's in. Now, Carol, here you go. Let's go back Yeah

Yeah, exactly so But at this point guy, is it just you now or how big is your current team? current Full-time team is me and my wife. We work out of our basement. Her office is 30 feet that way. Oh, maybe not 30, 20 feet that way. And then what we do is we bring in freelancers, experts on their own, and fit who we're... I almost like see it as I'm a big NFL fan is every project I will draft or through free agents a cool way of saying the exact I'm stealing that skilled players if I Like that I like that approach

You have to draft the team and the other thing is what I used to do was always Default to the same things. I treated every job as the same. So like every job needs a gaffer, DP, this, that, all like, it would just be like a template. And now the way I see it is you have to use your creativity in how you actually crew out and how you execute as well. Like creativity should be used in the budgeting and like just the day planning and all that stuff because you can unlock a ton of value

and actually like increase your production value by you know, like changing up your mixture, your recipe for that you know, like changing up your mixture, your recipe for that, uh, you know, unique job. Oh, I know what you mean. So it's like, for example, if like, normally a lot of projects need a director, producer, DP, gaffer, PA, audio op, right? Based on the project that you're selling, you might realize, okay, we're pitching with that kind of budget in mind, but it's like, oh, we don't necessarily need

an audio op for this project because there's not a voiceover. Or even a stronger editor, maybe. Let's allocate that budget to a secondary camera operator with another camera, or a stronger editor or editing team. Then you're basically reallocating resources based on that budget. I mean, but then there's sometimes the aspect though,

where like a client's budget is only a certain amount. So you have to kind of make cuts where you need. So that budget doesn't really get allocated in other places, but I know it, I understand what you mean essentially. It's like getting creative with the budgets where it's like, you might take out a little bit from production, add to post,

or take out a little bit from post to add to production to make it a lot easier for post. Exactly. And to me it's all about, like they say Warren Buffett, well they don't say, he says, Warren Buffett says his greatest skill, the gift that he was blessed with at birth is capital allocation. So he just knows if you give him 100 bucks, how to exactly split up that 100 bucks into different investments to yield the most value. And I think that's what we all have to do is,

you have to look at this budget as your Warren Buffett kind of investment sheet. Like exactly how much are we going to allocate and where to maximize the production value on the screen. A lot of times people see our work and they're like, oh man, what did that cost? Like 200 grand? I'm like, no, it's like 28,000. And I think that's through the, just thinking differently.

A lot of times, I would say nine out of 10 projects that you see on our site, I'm booming. Because I was like, I'll just boom. Like we'll just put that money somewhere else. I need a, you know, a colorist or somewhere else that is actually gonna go on the screen. So I don't mind booming. And like on the Matomoomo Gugelheimer thing,

I'm in the desert tripping over all my wires booming. It's a huge joke on my sets, how awful I am as a boom op. Because I'm just in a tangled mess of wires trying to direct and boom op at the same time. But to me, I'm like, I'd rather just, I know it's inconvenient. It hurts my back. Luckily now you're also at a of I think you're at a more

Somewhere else because your overhead cause I'm sure of decreased by decreased tremendously where you can also just you know be like the the audio offer your shoot or whatnot versus Versus in the past. I'm sure you wouldn't have been able to do that Versus in the past I'm sure you wouldn't have been able to do that because if you had to keep feeding the beast You have to stay in the office do sales figure out your accounting do all that jazz. So Mm-hmm Yeah, and that's a huge lesson I learned is You know, I'm a video maker I will say I don't think it sounds Bragging, but I think I'm a darn good video maker. I I've been making them for 30 years. I'm pretty good at it and

When you build a business and especially the second you hire someone You are now moving from video maker to business operator. And those are two completely different skill sets. They couldn't be further apart. And I assume just because I was really good at videos and everyone wanted to give me money that building this company won't be a hard thing. And yeah, it couldn't be more wrong.

So yeah, the fact that we don't have the overhead allows me to say no more. And I think that's, you know, we talked about moving from generalist to specialist. I think, and I think that's what Warren Buffett says too, is in his early years, he said yes to everything. Now he says no to most. And that's how I do it too.

Like most projects, our win rate on the number of leads that come in versus projects that we do is probably like three percent. It's it's just like like you know like a batter looking at pitches you know you gotta like watch them you can't swing at all of them. You should only take the winners. Even if someone wants to give us a lot of money, but I can tell that we're not gonna be able to beat us, again, that's a big red flag in a liability because now we have to do this work

that we're not really good at for a client who really doesn't value us. What are the chances that that ends well? Yes, we'll have money, but how many sleepless nights? You know those emails that come in from clients at 8.30, like, hey, we need to talk tomorrow morning, and you're like, oh, God, and then you're not sleeping, and then you start treating all the other clients

like that bad client, and so that's a huge thing is you have to say no to the bad clients because they will like infect at least how I work is they will infect you and then you'll start treating all the clients like that, like the evil one. You really nailed it on the head there. Honestly, like I like how we call them evil started to. You guys just made me laugh. I already know probably one or two that have already, the evil one. Yeah, cause I remember last year,

there was one client project where it was like one where we didn't even make that much money on it in total. The profit margin was super low, but then Dario would keep getting emails and calls from the client at the most random times to get certain things done. They weren't, they were trying to get like, they were trying to get us to start doing animation work

before a script was even ready for a voiceover artist and things like that. And it really just goes to show like the amount of energy and time and effort gets wasted on that one bad client. And then when you have your good client calling, yeah, you're still gonna do good work for them. They weren't bad people, it's just getting it going.

But then I did my classic thing of like, you set boundaries where it's like, it's you have to be inconsistently consistent. So like, I wouldn like be available right away. Sometimes I'd be available right away for emails and whatever and then sometimes I'd wait a day or two. You never know my schedule. I'll get back to you. You just don't know when as soon as I establish that they kind of like understood. So the other thing is never give out your personal number. Never give out your or never answer anything from your personal number. That's the truth. I love that

Yeah, keep everything on especially with those types of clients not even that like you don't want to like me called That's like a bad trap I noticed it's like sometimes you start like a text combo with a client and then like it's like text messages. Like you just get text messages all the time because it's a lot easier to send a text than to send an email, right? You gotta try to keep that strictly email or like look at my Calendly and book something there. Yeah.

Type of situation. Man, you know how many years that took me to learn what you have done? Yeah, that's exactly right. I learned back in the day, I read a book and they said, yeah, email is not a priority. You need to subconsciously teach them that if you email, it could take 48 hours. That if something's truly an emergency, call the business line or do whatever, but you don't use email as a channel for urgent things. But I guess that's harder and harder every day

because who's got phone numbers anymore? Well, also, how do you constitute what is an emergency? For one client, they will think everything is an emergency because everything needs to be done at some point. So that's why you have to keep it in an email format because then that also forces them to manage things on their end because sometimes what happens with some clients is that they leave things

to the last second and then they try to get you to compensate for that where it's like they had a week to prep something where they needed to get a video done by the Monday, right? And then they instead of telling you on the Monday, they tell you on the Friday, try to call you frantic and say, oh, we need a video done by Friday or we need to make these changes done by Friday. Can you get it done right now? It's like, why didn't you tell us on Monday so we can plan it out and then coordinate, right?

So you have to kind of, you're kind of like teaching them in a way, right? It's like, you know, there's, you have to do some work on your end so that we can help you get your work done in a timely fashion, right? Like, obviously you always try to help them as much as you can, right?

But also if you're, if you start to enable that by constantly doing that for them, then they're gonna think that is the norm. They could always leave things to the last second, you're always gonna do it. And I see this happen with a lot of freelancers that we've worked with in the past who work with certain agencies

and they became great problem solvers for those agencies and clients, but doing it very quickly and very much at the last second at his expense and he suffered as a result in the future. And you know, like you have to slowly, you have to basically teach clients, it's like look, I'm not your errand boy that's going to be at the phone waiting every five seconds

to do your bidding. Like if I'm doing that for you, how am I gonna do that for my other clients, right? It's also teaching them, it's like, I'm treating you with good respect as I treat all my other clients. We wanna make sure we take care of everybody, right? Because if I'm doing that for you, what's to tell you? It's like, if I don't answer your call next time,

I'm doing that for someone else and then I can't give you the necessary attention. So it's really a balancing act when it comes to that. I love that One thing I was gonna also Just sadly we finish because you mentioned it's just you and your wife now as like the core team like Were you guys? Yeah, were you doing that before with guy Bauer productions? Or was this something you decided with the new venture like to go into business with your wife

She she's been working with me since like 2015 or, yeah. Oh, okay, so it's been a while. So she worked in, yeah, she worked in the old company. And then, and essentially it's, there's two branches of our company. There's operations and then there's creative. And she does operations, I do creative. There's a very, say a very solid firewall there.

Because I would say I'm awful to work with actually. People that say that are always great to work with. Don't be so hard on yourself like that. Come on. For as many like cool... Don't be so hard on yourself like that, come on. For as many like cool... They're the greatest people to work with. I don't know.

Anyway so I think it's... The other thing that she... Because she's my wife, like if I start acting crazy she's like, dude, be quiet. Like she can tell me to like shut up and kind of go to your room. She has the ability to tune me out. You know, and that's, I think that's critical because I'm a very, I'm from New Jersey. I think out loud a lot of times and sometimes and that's what you know We would also freak out employees like if a client wasn't happy

We got you can't say but yeah Well, I can drive an uber and as a leader Like that's the worst thing to say. What are you doing? You idiot like but that was my internal thought is like well, you know I could drive an uber like And that is still my backup plan. Or really, I think my backup plan actually is changing to I want to like a mall pizza. But anyway, I always have a backup plan in case all this in case in case people realize I stink or something.

But yeah, and she's like your consul. He knows like when I start talking like that, just like shut up. Yeah. Consul. Yeah, exactly. I love it actually. And she's actually a really great. She used to be a paralegal.

That's probably the best person to have running operations to redact like thousand pages of documents. So Yeah Yeah. Yep. She finds everything We just did a carnais for a job we have in a couple weeks and she found like one line I would just go sure approved, you know, she found like one thing they didn't include and so yeah, that's that's and that's not my like one thing they didn't include. And so yeah, that's, and that's not my type of thinking. So we don't really step on each other's toes, which is also good.

Hey, Carol, go ahead. How do you guys separate it? It's very, it's very straight. It's pretty straightforward. Dario handles more of like the sales and outreach and yeah, a little kind of like the operation side of it. And I handle more the creative aspect and the actual head of production. And that's kind of how we've split it. Obviously there's always a little kind of like the operation side of it. And I handle more the creative aspect and the actual head of production.

And that's kind of how we've split it. Obviously there's always a little bit of overlap. I basically handle up until like the production is done. Then responsibilities like Kierl obviously does. I mean like most of the creative on that front. So basically how it works is I'll do sales, client communications, some managerial stuff as well. And then once it gets into creative,

like pre that's a lot of Karel. I'm basically like the client's eyes during that whole process. Like what would they approve? What would they not like? All that stuff. And then during production, I'll take on producing and then we co-direct.

Unless he's on a separate project, he'll do that. He'll just produce and direct. And then once it goes into post, it's just totally Karel. I'm basically like the step before the client. So like, I'll see the video, go like, no, they won't like this, won't like that, change this. And then it goes to client. Yeah.

Yeah. It's the one funny thing about that. It's a good system that we have in work and it's helped us out in many instances where like when you're basically working on one thing, you get really kind of focused on the creative and you get attached to kind of like how the deliverables are gonna be because it flows in a certain way.

And then Dario will come in and be like, oh, here's like a shot that might have been missing or here or like, oh, you need to adjust this thing. It becomes like one of those like frustrated relationships. My skill, I know, but it's not Dario, right? It's really for the client. When I see one of our videos, like in the rough cut, I'm like, they're not going to like this. They're not going to like this, they're not going to like that, we got to change this.

And then every time we don't listen to me, they come back with those changes. So after a while, we're like, listen, let's do it the way I think they'll like it because then they'll like it. But Kero's also good in the proposals because when I draft those up, I have him take a look at it because sometimes I might forget what we might need in terms of like Production support or anything like that. So he will come in and say no like you didn't we need to boost up the pre Cost because it'll take more work or this or that so then him and I have to like fight on the price because I'm like I think we'll close it if it's closer to this amount but girls like no

It's gonna cost us this amount to complete it closer to this amount, but Kero's like, no, it's going to cost us this amount to complete it. That's the thing that's always like, it's like a, like we're having battles with each other, but it's like, it's really us trying to battle with the client, right? And then it's one of those aspects where they're saying, no, they're going to close at this price. I'm like, all right, but we can't be pitching $500 for reproduction for this project. You know, like that's just like an example, right? But it's just one of those things where you're always

trying to kind of like figure out a good balance. But that's like how it is with any business when you're working with client projects. You're trying to figure out what is the best approach that is doable for that client. It's not like you can just take a hundred thousand and call it a day, right? As a low blow.

Yeah. I had to throw one in there just for the fun of it. But anyways, you know. Go ahead. Oh, sorry. What were you going to say? I was going to ask, like, how do you guys, do you have any, like, shortcut of of budgeting like how you I like the way we do it is very basic

I think we're doing it the right way, but Like we've already established like what our costs are so we have like different packages essentially and we just modified those so like Yeah, like, yeah. It's like a baseline. It's a baseline based on what, what a client, uh, what a client's budget is. Like when they, when they present like what they're looking for and what they're and what their budget is, we have certain, cause a lot of the time we're getting clients that don't do video too.

Nobody's saying on our end, we're trying to kind of get do video too nobody's saying on our Like we have we have like part determine process prices set already and like there's some variance in there, so like for example with pre-production we have some flexibility and lowering it if you know, there's not gonna be too much pre involvedved, and then that can help us close the project, or increasing it if we know we need to do more pre, but it's usually around that range.

So we have about, I mean, we've been doing this since 2014, so we have a rough range of, it's usually within this price point. And then the easiest stuff to figure out is just like for Like our production team like we already know what like all the freelancers what their costs are So we do us like, you know Duke a little bit on top of that Easy tricky one for us is always for editors Like we know like the rough range, but that's also where we make a good chunk of our profits. So

Yeah, but our margins are pretty high. Like we have every project we do. I think our margins are like 30, 40 percent goes to the business. Like the rest is just like hard costs. Keeping doing doing the shoots. Yeah, to stipulate, though, is that these margins are also based on us doing that work and those other aspect, right? So like one thing that I think a lot of people

that might make a mistake sometimes, especially when they're pitching for post is that when an editor charges for a project, they'll charge that and maybe just a little bit, like just a small amount on top. But what people don't take into account is a lot of the time what you're also doing on the backend with the editor,

working with the editor, your time that's involved, that's a big aspect of it, right? So it's like, okay, if we're just gonna charge what the editor is gonna charge, so basically I'm just gonna give it to them, he's gonna figure it out and then I just deliberate. That's what that makes sense. But then what happens in this situation

is when you're working on a very creative project that you developed in pre-production, you have to work with the editor to get it exactly right, exact timing sometimes even, and then you have to also communicate that with the client, go over those notes, and then work out kind of like, all right, you don't wanna do it like this, maybe we can kind of do it like that.

There's just so much more time that goes into each stage of the process. And then the more projects you do, the more you will learn how much time is generally set. So that's why Dario was saying, there's a rough range that we might get an idea of, but it's always good to confirm with your freelance editors. Is that answering your question?

Darren, and then you figure out how much time you're going to spend on it. And then that's how you build. But is that kind of like, that's exactly right. Yeah. And how do you go about it? Like with your, with your projects? So I just copied, I don't know if you ever heard of this podcast called revthink. They have a thing called the split.

Essentially you take the big budget and you divide it in half and that's how much you can spend on freelancers. So if you sell a $20,000 project, you can spend $10,000 on freelancers. The other 10 has to go to all your, like to maintain the agency and that's for all of your hours And then your profit comes out of that 50% So essentially, you know, that's kind of I think we've been we've been basically Doing that without knowing without because I think like I said 30 40, but I think it was actually a little bit higher So we've been something like that. They could just naturally

a little bit higher. So we've been unconsciously like that. Like it just naturally became like that. So half of our costs would be the freelancers and then the other half would just go to the business, right? And we tend to do all. Yeah. And we it's. Yeah. Yeah. Yeah. So we're doing something right, girl. Yeah. Paying us as an expense. Paying the. And that's, that's, yeah. Yeah. It's a natural progression because it's like, if you basically pitch a project based on just what the freelancers are gonna charge, which a lot of production companies do,

but that's like, at that point, like you're basically managing without being paid for it as well, right? Like you're doing the work for the client without getting paid for it as well, right? Like you're doing the work for the client without getting paid for it at the same time. But again, you have to start somewhere. It always depends on your situation, but I like how you put it.

It's a good rule. It's like, if the budget's 20, half of it goes to freelancers because then you also have a system that you know in terms of like when you make that sale. What was that podcast called? RevThink? Potential margins are as a business.

I'm gonna check it out after this. RevThink. Yeah. I have it open here. Yeah, I think it's called The Split. If you just search their podcast archive, but it was a, yeah, it was just that one episode I listened to, I was like, oh man, that's actually brilliant and very easy.

And the way we do it is we always write to our production budget. So if we, you know, for example, if we have a $30,000 job, when I'm writing the script, I'm writing this to be made for $15,000 hard costs and freelancers and everything. So it's like you, I kind of like ever since we did that, it's been just a lot easier because we're not stretching ourselves. The worst is when you've pitched this job, pitched this idea where you're like, I... That client, Kyril was talking about that.

Like I think we broke even on that project. Yep, everyone's everyone's done that. They got in touch with me recently. I've been like, no, not a time we spent on that. They want to do a lot of time alone, right? Yeah. Just double the double the quote and then see what they say. But I like that kind of rule mindset

because even though Dario was saying we've unconsciously had that kind of approach for us, thinking like that, especially in the creative, is a good way to kind of keep things within a certain budget, especially. And I like that approach. It's something I'm gonna start kind of Keeping in the back of my mind as we're getting through that but the problem is like sometimes when you're pitching with leads You're trying that's why you do the starting you do the start you do starting at and you work it really small

Yeah, but yeah, it's it's always like a jumping-off point right like that's what I let my Know as well. It's like this is what if it starts at But again, like if we get like it might go up depends on what you guys want to do, right? So many good tips this episode I feel like we got to do like a top ten what you go through each one Yeah, this I'm gonna go tips this episode. I feel like we gotta do like a top 10 with you go through each one. Yeah. I don't even know how to title this episode. We touched on a lot of things

that we haven't touched upon before. Pre-billing. It's always nice. Don't accept pre-billing. That's the title. Don't accept pre-billing. That's the title. Oh't accept pre-billing. That's the title. Oh, one thing I forgot.

We were talking about bad clients. There was a story, I'll never forget this moment, just how bad a bad client is. I did this project with a bad client and we wrapped walking to my car. I was like, I'm not cut out for this. I'm not cut out for video, meaning it's not like I'm not cut out. It's like I see the video.

The client had me convinced that I was terrible. And I should just leave that I'm just the worst director ever. And that's what can a bad client can do. And they paid, they paid everything, but walking, I'll never forget that feeling walking back to the car. I was like, yeah, no. Jesus.

I was completely convinced I was like just garbage as a video maker. So it is awful. And that's why like in that first call, there's so many times where I have these gut instincts. I once had a call with a client who was like eating while they were talking to me on the, on the first call. And I just, that's kind of a sign of like, well,

you're the help. Like you're, you're, you know, like you're done. Yeah. I'm going to eat my lunch while I talk to you. And I was like, and I didn't listen to my gut and it turned out, yeah, to not be good. And so like that first call, you have to like listen to your gut. Because it, I'm telling you, it always comes true. Like exactly what I think is going to happen on that first call usually ends up happening.

And it's so weird because you're in a business and they're gonna give you money and that's cool. And like your spreadsheet doesn't show any emotion. So your spreadsheet doesn't know like, you know, yeah, this actually brought in a lot of profit, but at night you couldn't sleep and you thought your whole destiny is meant for doom. Like like that's you don't get to note that in a spreadsheet Yeah, and and that's the and and what they can do is what I've noticed is that when we're not ending off

We're not ending on a negative note. So you got to tell me something positive before they it's a virus man. I Was oh And they, it's a virus man. I was, oh, well, here's, here's before we get to that, as you were mentioning that I was looking around my desk to see if I had a granola bar somewhere that I could just slowly open right now. Damn it, I'm like, I'm like feeling in this backpack here. I'm like, do I have one? You should have done it.

Can I pull off this timing perfectly? Damn it, it's in the kitchen. I can't get the That's that's what I mean We got to film this after Carol and we'll cut it into the episode and I will make your Okay, this is like Say something say say something positive though cuz like I want to Cut let me tell me about like your most positive like fun. It's memorable experience something positive Thank God I think, yeah, something positive. Well, one time this time, we had our sales calls and that was really good.

We put them on the spot. That's why. No, actually, like I would say this is that if you look at Umalt's clients, there are great clients out there. There are very many great clients. Yeah. And it's like, do you ever see Fantasia? The OG.

Yeah. There's this anime, the old one, I think it's all these centaurs. Yeah. There's this anime the old one. I think it's all these centaurs yeah, all these centaurs are like met meeting their mates and There's this one center. I forget. I don't know. Maybe they were weird-looking I forget what their whole thing was but they were sad because there was no mate for them but then eventually they found their mate and they were like mirror images of each other and and they were like mirror images of each other. And this took me a long time to learn is that I am good enough.

Like what I can do in the very limited capacity I have, I can't do everything well. I can do like this little sliver really well. Like and sometimes I think world class, like this little sliver is my lane. And guess what? There are clients out there that want that little sliver of what you can do best and have confidence in yourself that you can do this. You know, you can't do everything, but you can do this. And there are clients out there that want you that think you're good like you don't have to be something you're not and you don't have to like feel bad

that you know like you can't do stuff that they do on smuggler's side or pretty bird right like that what you do is wanted and very valuable and it took me 14 years to be able to be comfortable saying that and so don't get discouraged when you are with bad Clients or when you're just starting out. Yeah, you're in event videos and they forget to feed you which has happened What they're like really I once had a job where a client was like mad that we had to go to the bathroom Or mad that I I let the crew eat They're like, oh well, this this is going to cut into it. Like they were upset that we were like had human needs.

When you're in those depths, just know that eventually the good ones will find you. And I have a client right now that like I just can't believe I have because they are amazing. And we see eye to eye and we have creative discussions for my last email per my last email it's just very respectful per my last email I love how you added that voice there are centaurs out there for you and you will make your match and there's a client like that that wants you for you Super inspirational, let's let's end

Okay, so guys if you want to find love it don't take guy Bauer you can go to you more Okay, now I'm not getting up the new Okay, it's um, all but it's spelled you more Um, but it's spelled you. Malta, you and a ULT.com. I actually found your site back in 2021 when we were redoing our website. I was trying to get inspiration and like you are ranking like crazy high. And I remember checking out your site, going like, oh, shit, this is really good. And I sent the video you had in the about section of Carol way back then. I don't know if you remember, Carol, I was like, yeah, check, check out the video that these guys did. It's the same one. Yeah, because I went in the about section of Carol way back then I don't know if you remember Carol I was like yeah check what check out the video these guys did

it's the same one I yeah cuz I went to the about so it's the lady the lady was in the same one I remember sending it to Carol I'm like yeah check out what this guy's doing so I'm glad to finally yeah I'm glad to finally be able to chat with you all these years later now but okay yeah you ma mault t comm and then your social is what? Just you ma you LT just all over malt at we're both And you guys are based in Chicago, correct channel that we spend the most time on. Is that close to Chicago? We are actually in Oakbrook Terrace, Illinois, a suburb. Is it? Okay.

But Chicago, yeah. That's like the berry of Toronto, okay? Okay, that's fine. I live in the boring part of Toronto now, so I understand. Yeah, it's like the boring part. Okay. Yeah. But I think thank you so much, man. Like, honestly, this was such a great

conversation. I still think we should do like a top 10. I feel like we could chat for hours. Got enough. Like I could see it in his face. I'm like, he's got a lot more to say. Yeah. I got some stories for you guys.

No, honestly, this has been one of the best conversations I've ever been a part of because it was a conversation, you know, and I appreciate it. And you guys are doing it all right. I mean, I think, you know, you've learned so many lessons that took me way longer to learn. So I appreciate it. and your favorite podcast app. Creatives Grab Coffee is created by Laps Productions, a video production company based in Toronto, Canada. Creatives Grab Coffee is also sponsored by... My name is Mehran.

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