Den Unleashed Part 1- Why so many businesses stagnate or fail

G', day, guys. Fantastically interesting approach the podcast this week because the tables are being turned. Charlie Valor, who was the very first guest on this podcast, came up with an idea. He said, dan, I'd love to hear more from you about your experiences of running a business. And so we're kind of calling this Den Unleashed, which is where Charlie's going to really basically interview me for this podcast episode. And today's topic is all about, you know, why so many businesses stagnate or fail to ever get beyond that kind of, what I call that freelance mindset. I speak to a lot of filmmakers all over the world in various stages of business, and only a very few, in terms of percentage terms, ever invest themselves and work with a coach like myself. And I was always kind of curious, why is the those that invest in coaching in themselves end up building really sustainable and solid businesses versus those that don't. And so Charlie said this would be a great topic to discuss on the show. So that's what we're doing today. The tables are being turned and Charlie's hosting the show and he's going to interview me, talking about why businesses fail to really get beyond that, what I call that freelance mentality. And I think it's because of a scarcity. It's because we're. We're so used to kind of feast and famine, so used to hunting down the work and grabbing it while we can and doing as much as we can, and then it dies down because there's no marketing going on. But anyway, Charlie will delve into this. I hope you really find this episode interesting. I really enjoyed sharing and if you find it useful, maybe we'll do some more. We actually recorded two episodes back to back, so hopefully you'll find these useful. And don't forget to subscribe and share with anyone you think might find this of value. Anyway, here's the show.

Welcome to the Video Business Accelerator Podcast. Each week, we uncover the secrets to creating a wildly successful and scalable video production business. With your host, Dan Lenny, discover how the accelerator program is transforming the lives of our members at www.videobusinessaccelerator.com. enjoy this episode.

This week, I have got Charlie Valor back on the podcast. Charlie was our very first guest and Charlie and I were chatting and we thought it might be cool to just have a bit of a freestyle episode where Charlie actually asks me some questions. So, Charlie, good to have you back. How you been, Dan?

I've been really well, and thank you for having me back on the show. I think it's a great sign if you ever get asked to come on a podcast a second time. It's a huge honor. Huge, huge honor. So big thank you on that front. From there.

Oh, my pleasure. And loving, loving your new podcast setup. Looks. Looks very cool.

Well, it's interesting since the last time I was on the podcast, I actually feel like I'm probably more of a video business owner than ever. So doing a lot in the podcasting space and making a lot of social video content. So understanding this space more and more and really why we've been speaking so much more and so much more in depth of these topics has kind of brought us to this episode and why. I want to ask you some questions.

Yeah, well, I mean, I, I'm all for it, Charlie, so feel free to fire away. I'm going to be exposed here. I'm going to just answer everything as hopefully as truthfully and honestly and as beneficially as possible.

Awesome. So to give the listeners some context here, I was having a chat with Dan earlier in the week, and in all honesty, like, this conversation, I think turned into something really powerful and, and something that I think can benefit most filmmakers. And I thought it was an absolute waste only being shared with me. And Dan had this great idea. He's like, can we, like, let's talk about this on the podcast? Like, this is the stuff people need to know about. And I couldn't agree more, which is why I'm here to do this with you and hopefully shed some light. So, guys, something a little bit different. I'm kind of. I feel weird hosting your show a little bit here or leading your way.

Makes a nice change. It's like I'm actually following a lot of your philosophies here, which is I'm leveraging other people to do my work for me.

Well, I mean, Dan, we. We've had some recent experiences that led me to a question that I want to lead off with here. And I'm really curious, really, really curious how we can go deep here and understand this. Well, but why do so many video businesses stagnate or fail, which is something we see a lot in this industry?

You know, it's, it's a really great question because I, I come across a lot of filmmakers, obviously, and what we do here. I've been in this industry for a very, very long time, and, and I see the same patterns and, and my, my, my kind of my, my, my, my thinking is that there's a fear, like we can say we want to grow our business and we, we have an outcome for the business. And we might have a revenue goal. We might want to just, you know, buy that nice house and be able to take the family away on nice holidays, not have to work, you know, weekends. But I think it's a fear of change. It's a fear of risk. I feel there's a. More than any anything else, as creatives, we have a real scarcity mindset. You know, we all have a balance of scarcity and abundance in our. In our DNA. But I think because many of us start as freelancers, there's a real fear of feast and famine and freelancing. Like, you're either working or you're not working. And at certain times in the year, things can really fall off a cliff if you don't do any marketing. And I think most freelancers don't do any marketing.

But if you want to kind of build into becoming a business owner, you have to change your mindset. And that's the first place you start.

You have to understand that scarcity is very real and it's something that's built into you. You know, it's. It's like the. The conversations you might have heard as a kid, like, you know, hey, money doesn't grow on trees, kids. And, you know, you know, we can't afford to do this, we can't afford to do that. And I grew up in a family full of love, but there wasn't a lot of money around. I think my dad, you know, when his peak, 22,000 pounds a year as a printer and had a family of four. And we always had great Christmases and we always went on nice holidays, but it was always done kind of on a budget. So, you know, for a lot of years, I was like, oh, money's. Money's scarce. Money's tight. You know, money's in short supply. And so that story was like, you know, and it's even. It's even displayed in cartoons. You know, the bad guys have got the money. The kind of. The mischievous villain has got all the money, and the people that need it don't have it. And that gets you thinking about this idea of, like, somehow there's a big vault of money and it's been distributed around the world. And, like, it's just bad luck if you don't have any, because the rich have got it all. And the media perpetrates stories of, like, you know, the wealthy have all this money and the wealthy are always dodging taxes and the wealthy this. And, you know, the distribution of resources is unfair. And so we grew up in an environment where culturally, the news media and, and even cartoons want to perpetrate the story of scarcity. And when you become a freelance videographer, you know, there are times when you are feeling very abundant, when there's lots of workaround and clients are paying you well and then you might lose a job or you might find a client doesn't hire you again and it's like, oh, shit panic. I like, I wasn't expecting that. So I think there's a real scarcity around at the fear of, of losing something. And so to bring it back around to the question is why does that then impact businesses and why do businesses kind of tend to stagnate is because of the fear, the fear of losing something. The fear of if they invest in themselves, if they go and spend some money learning about how to become a better business owner, like somehow they're going to lose something. And I find that to be a real, kind of at a deep level, it's ingrained in our subconscious.

That's such an interesting answer. And I want to give a little elaboration and I want to go deeper on that because really, like, if you look at the last five years, videos exploded as an industry, like exploded. Like the trend is like, there's so much video being made. Corporations and businesses are spending more on video than ever. Manuals for training within schools and industry are all video now. Like everything is video. And if you've been in a, let's say any video type of business in the last five years, this should have been an absolute boom time. This should have been the best years, theoretically that have been in a long time based on that. But the reality of that is maybe not so true. A lot of these guys, or a lot of potentially these guys, and I'm paraphrasing on an industry here, it's not individualized, but that mindset or gap in return, recognizing that or ability to move past that fear or money can be very, very limiting. Incredibly limiting.

Absolutely. And you know, I think that our businesses, you know, we had Jeff on from Sonic site a few weeks ago. Jeff had been running his video business for 26 years in that feast and famine. And if you haven't listened to that episode, it's a really good one to go back and check out. But Jeff was like, that was my business. It was feast and famine, peaks and troughs, until he discovered a niche. He discovered that you could supply that niche and they had a need. And because he was specializing in that niche, he was becoming the go to authority figure. And one school would say, hey, we love that video. Can you help us do that? And then he figured out how to create subscription packages where he could give them ongoing content. And that made it easier for them. It alleviated their cash flow issues. It's worked out brilliantly, and there's a whole episode in that, so I won't go into that now. So Jeff was someone who had been in the industry a very long time, realized something had to change, but he changed. He innovated. And I think our industry is very innovative when it comes to technology.

And that's part of the problem, is that.

I have personal relations with a lot of the equipment manufacturers, and they're just doing amazing things. You know, I've worked with Sony, I've worked with Zacuto, I've worked with, you know, Atomos, blackmagic, all of the big brands. And I think what they're doing fundamentally is phenomenal. But there's also a culture, and I don't think this is even intentional. I don't think anyone realized this was happening of. Of scarcity around, like, the new technology. Like, the newest camera comes out, you know, we go from 1080 to 4K, and 4K is a huge leap in quality from 1080p. And yet now it's 6K and 8K. And Blackmagic just released a 6K camera. And I'm like, hey, that looks pretty cool. But there is so much like now. Now 4k isn't good enough. We need 6k and 6k is not good enough. We need 8k. And I think that the practitioners of our craft become overly consumed with the technicalities making films and ignore the fact that clients literally don't care. In fact, you are an obstacle to getting in the way of what the client wants. The client doesn't care about your equipment, wouldn't know what 4k is.

A lot of production companies are kind of getting too obsessed with the gear and missing out the why and what people need video for.

Oh, we have to go deeper here. We have to go deeper. And just for context, my wife, who I love dearly, B, she couldn't tell the difference between a 1080p and a 4K video, nor could any of her friends. It's just fascinating into your point there about how few would probably know the difference. Like, it's not the output that's created based on gear. But I want to ask a question on this because this is the observation I've seen in this industry, and I want to know if you've Seen the same. It appears to me that the video industry or video businesses seem to have this tendency, well, if I have the latest and greatest equipment or whatever, the newest thing is that that's what's going to drive success in the business. If I've got the 8K camera instead of the 6K one or the 4K one I've got now, well, that's what's going to make my business successful. And they just end up in this turbulence of investing more in equipment and software and computers instead of things like marketing or training or personal development type things. Is that what you've seen to be true?

You know, we did a survey last year and we've done a few of them over the years and it's like, you know, what, What Gear Survey 2019, I think it was beginning of this year. And I was, I was like, like, what gear are you using? What, what are you looking at? What do you think is the next greatest thing? And what's really interesting about that is it's always, you know, you do anything to do with gear in this industry and you'll get masses of people responding. But then I dropped into and how do you get work and what are your sources of sources of work? And how much have you spent on gear in the last five years? And how much have you spent on yourself in terms of learning skills like marketing and sales and how to run a business effectively? And what was fascinating, I don't have the exact figures, but maybe I'll publish the results at some point. I would do a podcast on the results in detail. Is that on average a large percentage spent in excess of US$30,000 on equipment in the last five years.

And the majority of people got work through word of mouth.

And the majority of those people had spent less than $3,000 in many cases less than $1,000 in the same time on books and education and learning how to run a business. And I just thought that was absolutely fascinating. But I wasn't surprised by that.

I'm not. I laugh a little bit and I shouldn't laugh because I'm laughing because this was me as well. Like I look back and like this is many years ago when I was a little pad one we'll call it, in the, in the marketing industry. Like I was obsessed with like getting every Facebook ads tool and every piece of software and every. I think at one point I had like $4,000 in monthly subscriptions.

Yeah, hold your breath. Because I had this obsession in myself of wanting like, oh, this is what's going to go through from there. And then I just laughing at that. It was like I wasn't spending even close to that per month on that saying business owner skills or marketing. So it's prevalent across the industries. It appears as well.

Listen, full confession. I was too, you know, when I was running my production company, at one point I had a Sony F5. I had a set of zoom lenses, a set of set of Zeiss prime lenses. I had a tripod which cost $15,000 because it was the best tripod there was. And I had everything. And I remember looking at in the corner, like where that lamp is in my, in my shop for anyone watching the video here, I've got this lamp in the corner of my shot. And it used to. I used to have the camera set up there so that when I did videos, it's like, hey, look at my camera. I'm a pro. And I worked it out one day and I think it was about $50,000 worth of equipment sitting on a tripod, literally gathering dust. Because a lot of the videos I was doing I was shooting on my smaller camera that had smaller file sizes. I could edit more quickly and were just more practical tools. And then I realized that the equipment wasn't going to make the business because clients literally didn't care. But what I then did was I sold all that equipment and I went to some seminars in the U.S. now, at the time I was living in the UK and the only place I could go and see these business seminars was in the US So I was paying flights, hotels.

First one I went to was in Austin. I think it was the Digital Marketers conference. Spent three days, flew to Austin for three days from the UK and it blew my mind. I was like, oh my God, like marketing and sales, let's call them different things. Let's call them inquiries and clients signing up to hire your services. And once I recognized that just word of mouth alone wasn't scalable and it wasn't consistent and I wasn't able to predict when work was going to come in. I was literally staring at the phone going, well, I've got no work. I literally used to say, I should be all right. I hope something will come in. It usually does. And then I would never contact clients. I'd literally go on to Vimeo or I'd go on to bh and I'd be like, oh, the blackmagic new camera. Yeah, that's pretty cool. Maybe I could use this or what? So it's like, you know, I justify spending time to Spend money on stuff that I couldn't afford with cash I didn't have, on things I didn't need.

Oh, that's a dangerous trap. And I tell you what, if you keep investing money in that gear and the cycle continues, you can end up in a pretty dangerous position financially. As a business owner, it gives you, like, as cash flow gets worse or as your position gets worse, it gets harder to make moves. It really, really does. So, I mean, I admire that you were able to kind of sell and move on to that stuff, Dan. I think it's really, really powerful there.

Well, I've also. I've had crippling debt, you know, and. And. And this was around about 2004. I'd broken my ankle in 2001 on a shoot on Mont Blanc in Chamonix in France. Had six months off work. Thankfully, I had income protection insurance that, that. That was specific to being a camera receiving an income. So I didn't lose the house. But two years later, I was filming in Africa on a show called A Place in the Sun. Homer Away. It was a pilot episode. We were in Cape Town. My ankle didn't feel right. Came home, I went to see an ankle specialist. And he said, okay, so I've had a look at your X rays and I've assessed you.

And this was interesting because he was a specialist. He was costing like $400 an hour.

But I wanted the best advice. And he said, what do you do for a living? I said, oh, I'm a cameraman. He said, not anymore you're not. He said, you've got arthritis in the ankle. So my career was over like that in a flash. Now, again, the insurance that I'd invested in covered me for total permanent disablement of my right ankle in relation to being a cameraman. So I'd invested in insurance, which paid off when I had to pull on it. But I just bought a new house. I was probably earning £70,000 a year at the time. As a freelance cameraman. I pushed myself to the limit on the house. It was a beautiful house. I was like, hey, I'll have. I've worked hard. I'll have the treat now. Something catastrophic happened to my career, and I generated about $50,000 of debt in six months because I had no income, and most of that was on credit cards. So, like, I've been in that hole where the debt of the repayments, like, you need to pay a thousand bucks a month just on the interest. But then you start to justify to yourself it's okay, because as long as I can find the thousand bucks a month for this, I'll be okay. Meanwhile, you're looking at equipment going, well, I need more equipment. And like, equipment is not the answer. Like, everyone listening to this has a camera that's good enough to shoot, content to sell to a client with high return.

And I think that the real, like, my goal in setting up this company 10 years ago and certainly in the last few years with the video business accelerator is to help as many filmmakers who are ready to move from that kind of freelance mode in terms of, like, they've started a business, they're running a business, but they're still in the freelance mindset, but they really want to run a business is to share all the knowledge I've had over the years that I continue to invest in. I reckon I've spent $150,000 plus on education, business education, because I want to help video business owners succeed. That's my purpose.

And I kind of guess because I've been in that hole where I've spent the money on the gear, I've had a $50,000 debt and I crawled out of it. Now I crawled out of it by going and getting a job in a warehouse for Pro Cam television in London. And I ran the warehouse. So I went from being a highly sought after freelance cameraman to working in a warehouse putting kits together. Now I spent some time building up and my career moved up from there because I realized I had some unique skills. But I learned about the nuts and bolts of running a business, and then I went to work for a sales company. I learned the nuts and bolts of sales, and for me, it's about client relations, customer service, and really caring about your clients. And if you really care about your clients, and by caring, I mean, you know, be in touch with them. Like the number of times I ask a filmmaker, hey, when was the last time you got in touch with your clients? It's like, oh, the last job we did, I'm like, so they're going to forget about you within a month, they'll forget about you. And what I often hear is, oh, look, you know, they were really happy with the last job and they know where I am and if they need me, they'll call us because we have a great relationship. And the number of times I challenge, you know, like, one of the first things we do in our program is we do an analysis, we do a review of your last 12 months worth of work. We do a deep dive audit of where your work actually came from. And two Things always happen. One is we always get a surprise where you think your biggest and best work is. It's not normally the case. And the second one is the number of clients you've worked with that you haven't been in touch with for three or six months. And it's leaving money on the table. And it's incredible.

I absolutely agree with that. I think. I don't even know what you call this chance to re engage or re engage. Go with re engaging with old clients. I actually suspect this is not just in the video industry, but I'm sure it's absolutely rife with it. This is one of the most ignored segments in business. Like, you go to all this effort to bring on a client, do a great job with their video. In this case, deliver a quality of work that you're proud of and that delivers on the goal and then you never speak to them again. Like, what a waste.

I know. But I think a lot of that comes down again to scarcity. It's fear. It's like, look, fundamentally video production professionals are really nice people. You know, they actually are empathic, they care, they're sensitive. We're storytellers, we love to help clients out. We always over deliver. But in that over delivering, what happens is sometimes that relationship gets kind of cloudy because things aren't set up properly from the outset. There's no system, no process for how to lay out any expectations early on in the process. And so.

That'S the first problem area. And we're probably rolling into another episode with this, I think. Probably. But in fact, let's pause there because I could go on for 20 minutes about this. I'm really passionate about this and maybe, Charlie, if you were up for it, you could continue this with me next week. Because I think this is. I'm really enjoying this. It's like a chance for me to share all of these insights that I gather on a daily basis. Working with people.

Den, Lenny unloaded, guys, we've got Dendist opening up here and dropping all kinds of nuggets. Absolutely. I'd be more than keen to do this again, Dan. Now, do you do the sign off or do I do the sign off?

At this point, I. I feel like. I feel like this is your podcast. Do you want to run my. Maybe. Maybe I could leverage you hosting my podcast. That would be cool.

Now, guys, I must also bring this. Dan actually played a heavy involvement with setting up my latest podcast studio that I'm recording from now. So I'm rather excited with all the stuff he's been able to help me with here, but this has been a phenomenal chance to use it. So thank you for that help there, Dan. And thank you for joining me on the Video Business Accelerator. Where can people go to find out more about you?

Well, it's pretty straight. It's a pretty cheesy plug, actually. I like it. Yeah, I think if you're listening to this podcast, you know exactly where to go to find me. And that's another topic, actually, about getting really clear on what you're doing and who you're doing it for. Because you want to make it easy for your target market to find you.

Absolutely. Guys, this has been an episode of the Video Business Accelerator. You know where to find Dan, and we'll be doing another episode like this shortly.

You've been listening to the Video Business Accelerator podcast with your host, Den Lenny. If you are a video business owner who is tired of going it alone and would benefit from mentorship, support and weekly accountability, then mouse over to www.videobusinessaccelerator.com to learn more about how the accelerator program can help you today. Don't forget to subscribe and rate the show over on itunes, and we'd really appreciate you taking a few minutes to leave a.