Business at a crossroads ...
I'm coming to the group here looking for some advice, wisdom... or just to talk me down off the ledge.
My tiny company is coming to a crossroads, and I just don't know which way to turn.
We've been around for 21 years, and for most of that time the mechanics of this company has basically been run by one person. I hired this person 16 years ago primarily as the office manager, to do bean counting and keep things running while leaving me to the creative side. Since that time, this fellow has basically crafted his own job doing more and more things, first quickly moving to general manager, and also serving as producer for many (if not all) of our projects. He's a gregarious type that loves meeting with clients, knows anyone and everyone, and has been happy to be the public face of our company. He's also a part owner... I had a junior silent partner in my early days, but when she decided to retire and get out of the business, this fellow bought her stock and so owns a small portion of the company.
Well, as my luck would have it, this guy... my partner and right-hand man... has decided to get out of the business and pursue other opportunities. Our work is pleasant, not tons of stress, and he is very well paid... but whether it be midlife crisis or some other reason, he has decided to move on.
We are an official "Odd Couple," but we have also been the perfect team.
I know this is my own doing, I should not have become so reliant on one other person, but not one ever had any inkling that the situation would change (especially considering he owns a small but still significant part of the company). That's all water under the bridge, though.
This has hit very much out of the blue. Everyone (me included) thought we would both retire in these jobs, I never had any reason to think otherwise. We always did fun and creative work, never had any debt, he called it "the best job anyone could ever have," got paid pretty darn decently, never missed a bill or a payment or anything, always had a least a few bucks in the bank and enough work to keep us busy. We've always been, as John Candy said in "Planes, Trains..." a "million bucks short of being a millionaire," but our company has always been very blessed (and I realize and appreciate this), and we've never had a single year in 21 years were we didn't bill at least equal to or exceeding the previous year's revenues.
But now... I just don't know what to do. The situation seems absolutely irreplaceable as-is. My one shot at replacing him with someone as good (maybe even better, he would have been my "dream hire") fell through (he had great interest, but the guy just couldn't swing it with his present job).
So what do I do? Do I try to muddle through doing all the bean counting and producing that I don't like to do nor am best suited for?...and hope to hang on and stay afloat? I'm not a good numbers guy, nor am I a good go-out-and-gladhand potential clients guy (too much social anxiety for that). I'm a director, and an editor. That's what I do and do very well. The other things, not so much.
Do I keep looking for a great Jack of all trades?
Do I hire someone to do just the admin work?... billing and invoicing and getting people paid and taxes done? I don't even know how to go about that.
Do I farm the numbers work out to an outside accounting firm?
Do I hire someone just to be a producer? I don't really know how to do that either.
Do I pack it in, ax the staff and studio, and go back to being a one-person company at home? I don't really want to do that.
This has whole situation has me absolutely paralyzed (I do not deal well with change... at all).
Any wisdom or guidance would be greatly appreciated.
Fantastic Plastic Entertainment, Inc.
Do you know anyone with a similar skill set? Anyone with similar experience? Who would you suggest, or who would you think of first?
Or, drawing from my son't current fruitlessjob search (but with great skills not reflected in his work history) are there any younger people who could use a good start, or some nentorship, who might rise to the challenge?
There is no "way to peace." Peace is the way.
Joke answer: Merge with Greg's company.
Serious(er) answer: This is an opportunity for new blood to come in. Even your ideal present guy had to start out less than perfect and learn on the job. He's got a duty of honor to help you transition in a new replacement. You go haunt the dean at the nearest university business school, get a short list of MBA's he's personally familiar with, that know they don't know everything and are willing to learn from this Ideal guy that's been running the shop. You can probably afford to pay them a little less, or consider hiring two of them and splitting the jobs and the pay in some way.
The upside is, they will have fresh eyes and could help move the biz in new directions, find new markets and clients.
This is only a tragedy if you look at it as an ending, and not as a new opportunity for growth and profit.
The best leaders give away as much of their authority to their people as possible - that's how you grow new leaders. You had The Best Guy... no you gotta build a new Best Guy or Best Gal, or both.
They're out there, I guarantee it.
[Mark Suszko] "They're out there, I guarantee it."
Yeah, I know... I just feel very very under the gun to find someone great, and find them quickly. And it is an opportunity for growth, I just have to get through the pain of having to do that.
On the upside, I could hire two people for less (probably well less) than the salary that is being freed up. Or suck it up and do those things myself and pocket the difference. But I'm old enough and tired enough (i.e. lazy) not to want to have to do that.
And I'm a whiner.
Fantastic Plastic Entertainment, Inc.
Sorry for just seeing this now, T2. And I feel your pain. That said...
Mark takes a very optimistic view of your situation. But I seriously doubt the process ahead will be easy. Prepare yourself for a lot of hard work and some pain.
I don't believe that closing is a good option at all. A better idea might be to look to merge with a friendly (or at least nearby) competitor. Your value would be a solid and growing base of clients as well as your by now exceptional skill set. Their value for you would be having the business side of things presumably operating smoothly as well as having people for sales/producing. May not be easy to identify this company, likely WILL result in some of your current staff being let go by the new entity, so as said above: prepare yourself for a lot of hard work and some pain.
Please keep us posted,evenly if it's privately, on what you decide and how your progress.
Sincerely, best wishes bud.
Never said easy. But it's worth trying.
It is so much harder to build a biz from scratch than to start on an established platform with good fundamentals. What you *will* have to consciously avoid is an over-attachment to how things were, and instead be hopeful and anxious to implement what *can be*.
If you have any background in rehabbing houses, or restoring old cars, musical instruments, or boats or furniture, those kinds of things, you will grok where I'm coming from. Evolution is painful but leads to survival, even success.
Finding those candidates and developing them rapidly, that's going to be a big job, but if the gamble pays off, it will pay off big.
And really, what's the alternative? Shutting down and cashing out? It would depend on how much risk you're able to afford. Could be your best bet from a conservative financial aspect is to close it down now, leave the field a champ. Or stay in, and switch to coaching. Not everyone can do it. But succeeding at such transformations to leave a legacy behind can be extremely rewarding.
Since my name was mentioned by Mark (even jokingly) I thought I'd chime in.
I believe you can do several options:
Option 1. Find an outside accounting firm to handle all invoices and billing, and find a sales person/account executive to find clients. You serve as producer/director/editor along wth others on your staff. After chatting with you about business, I know you are a producer as well.
Option 2. Sell your business but remain as a consultant for the business. Perhaps your employees want to buy you out? I believe you know your craft and clients better than anyone else would. You build your business to what it is today. That has tremendous value.
Option 3. Hire an outside accounting firm and hire a producer/sales person. This will help keep things where they are, with the least amount of pain of change.
Hope this helps somewhat. Best wishes Terry. I know you'll make a great decision.!
Greg Ball, President
Ball Media Innovations, Inc.
Two thoughts. Right now so many talented people in our biz are opting to stay freelance. Apparently it's too easy to start a new company. So they are not seeking staff positions. I used to receive 3-6 reels or requests for employment and now I am getting about one every 6 months. People who used to work for a local production company are now working from their home, many times with the same teams who were all at the production company. Production companies are now down to bare bones staff with freelance hires for jobs.
Also, are you certain this person is not going to seek work in the biz and become your competitor? Do you have a non-compete?
Our market has changed so much and tipped in favor of the freelancer as long as there is as much work out there as there seems to be right now. They usually offer lower rates than a production company so they immediately have the upper hand. They have the reputation because they can leverage their experience gained at the production company.
The production company can't compete with the lowering of budgets and sometimes the freelancers have better and newer tools than production companies because of the lower overhead of a home office. It's grueling and I'd love to chat a bit. Seems there is some similarity with us at least under the surface.
Not an answer but.....
Tilt Media Inc.
Video Production, Post, Studio Sound Stage
His operation is already pretty lean, from what I can see. Your point about freelancers is well-taken, however, I think there remains a need in larger projects for an overall coordinating point of contact: AKA the Producer, if a client isn't acting in that role themselves. When using multiple freelancers in ad-hoc single-project teams, someone still has that leadership role to take on.
I think you can outsource the "back office" functions such as the accounting and payroll stuff, to a point, as long as they are reliable. In a corporate internal media departments, that's already handled by others and you -could- get by with just a Producer and their list of freelancers, and literally everything else is rented on the fly, as needed.
But if you're going out of house, you still tend to lean on expert practitioners to shepherd a project along. In a home building analogy, yes, as the home owner, you could screen for and hire each sub contractor yourself, and deal with them independently, but usually, you pick a General Contractor and let them handle the rest.
Todd, can you afford to "take a sabbatical"? Get off the treadmill for six months, or a year?
I'd be very curious as to why your right-hand-man is going. Knowing more about his interior life would probably be very useful in charting your course. I have had a couple of very good partnerships. I found that thinking about why they were good, and why they ended, were both very instructive.
Actually, Bob, I'd love to take a sabbatical... but I don't think I could make that happen.
I could probably personally afford to take a year off (though might not be the fiscally best idea), but my business definitely couldn't. The majority of our business is a dozen or so advertising agencies in the southeast... and most of these companies we do jobs for several times a year, some going back 20 years. I might could take a sabbatical, but they wouldn't... they have constant needs, and without me around their business would go elsewhere... and probably not come back. I'd be starting my business over from scratch, and I'm way too old and tired to do that.
I'm hanging in there for now. I have decided to outsource all of our internal beancounting to an out-of-house CPA firm that specializes in handling all the financial voodoo for small businesses... they will do payroll, payroll taxes and all that assorted stuff, send our invoices, pay our bills, do quarterly and year-end tax returns and all that stuff. I think at least that part will work out well... and honestly when you consider the cost of their services vs. the amount of time that it all took my soon-to-be-former partner, if you look at the percentage of his salary that is equal to the time that all this financial work took him then really outsourcing it is a huge bargain. It actually makes me wonder if we shouldn't have done this years ago. We'll see out it works out, I'm hopeful that it goes well.
As for the rest of the duties, I'm gonna play it by ear and see what we need.
Thanks to all for the advice....
Fantastic Plastic Entertainment, Inc.
Don't forget that I'm located in the South East Terry, if there's ever anything I can do to help you.
Merry Christmas and Happy New Year!!
Greg Ball, President
Ball Media Innovations, Inc.