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Hiring Your First Salesperson for Video Production

The following is the transcript of our podcast on “Hiring a Sales Person” with Max Kaiser and Jake Roorda of Pipeline Video Production Project Management Software. You can listen to the podcast here.

Max:
We might as well just get started and talk about the issues that so many of us maybe don’t even want to think about. A lot of you are probably listening to this, and have either thought about, or are thinking about, or need to be thinking about getting some sort of sales person for your organization, for your video production company. And that’s a tough, as I’m sure you know, that’s a really tough thing to do in our business.

Jake:
We wanted to talk kind of about why that’s a good idea. What are some of the benefits of it and what are some of the things to watch out for? What are some of the risks?

Get out of the Feast or Famine Cycle of Video Production Sales

Max:
Some of the reasons why you might be thinking about doing this – you want to get out of that cycle. There’s a cycle that is the feast or famine. You have way too much work, get completely slammed, completely getting out of any kind of marketing sales role at all. And then by the time you finally finish up all that work, you have no work and you’re totally flat broke again. It’s a very stressful cycle.

Jake:
We totally experienced that a lot. And we’d have times where we were selling then too busy, then it wouldn’t be busy at all. And it was just hard to break that until we had someone that was worrying about sales, and we had separate people worrying about shooting.

Stay Focused on What You Do Best – Being Creative

Jake:
The next reason why you might want a salesperson is just because you got in this business to be out there shooting, not to be selling. They’re not always the same people that are great at the sales side and great at the shooting itself. So if you’re the type of person that got into this because you want to be shooting, then hiring a salesperson may be that natural next step, so that you can focus on what you want to do, but still grow the business.

Max:
It was always a dream of mine to be able to have some kind of sales person so that I didn’t have to do something that I didn’t think I was that good at and that I didn’t particularly like. I just wanted to be out shooting. I wanted to be out creating. I wanted to be out making beautiful videos and films. Selling was kind of the last thing on my list that I wanted to do. And I just felt that I was fairly crappy at it. And I was just like, “Wow, if we had someone good at sales, actually imagine what we could do.” So it was a dream.

Hire a Sales Person for Video Production to Break Your Sales Ceiling

Jake:
What do you remember as being your revenue limit? What ceiling couldn’t you break when you decided to bring on a salesperson?

Max:
I mean, I think $1M. I think we were trying to break a million. I think that we probably had five or six people working in the company and we were trying to break either $750k or a $ or something like that. And it had been elusive for about seven years into running the company and really, we didn’t really even have any kind of sales structure. We had a website, and people came to the website to find our work.

I went on every call and got on the phone with every potential client and talked to them. I thought, “Oh, I’ll just be the sales person.” And then I kind of just didn’t really love that that much.

Why You Might Be a Poor Salesperson for Your Company

Jake:
What about yourself would you say didn’t make you a good sales person? And what did you look for when you did finally decide to bring on a sales person?

Max:
So number one was, I was always too willing to give everything away. It was always such a dream to me that people were willing to pay me to do this and pay people I worked with who I consider my friends to do this, I never valued myself highly enough. And I would be like, “Yeah, we can do that. We can do that.” And we were constantly giving it away. So that was one thing. And another thing was just not following up with people enough, not following up with different folks that I needed to, I don’t know, I hate networking. I hated going to networking events or going and meeting with agencies, just all this stuff I knew I needed to be doing that I didn’t want to do.

Jake:
Would you also say that there was some pressure to keep your team busy? I mean, kind of a take work at less profit rather than take no work.

Max:
Yeah, absolutely. You get to a point where you’re just feeding the beast. Especially then we were all salaried and so you’re just taking whatever kind of works. So you get kind of caught up in that as well.

Jake:
That make sense.

Keep Your Mind Open About Who Might Be a Good Sales Person for Your Production Company

Max:
But I mean, the guy that we stumbled into and I guess it’s okay to say his name. I don’t know, but the guy we stumbled into is still a very close friend of mine now runs his own production company. He’s Chris Donaldson and he was someone I met at an agency. And then when he left that agency, he just was like, “Hey, can I just come over and kind of consult with you?” And I was kind of taken aback. I was like, “This guy was so good at talking to people.”

And he was kind of very gregarious and we weren’t even really talking about sales. He was just sort of interested in what we were doing. And he loved, loved video, just like the rest of us. And he had some background in doing it for agency, but he wound up getting a desk in our office and just sort of working with us for months for very, very little pay. I don’t know if we paid him anything. I think he just sort of joined in and was just interested in the process. And I think he had two young girls at home and he was kind of happy to get out of the house occasionally, too. So we gave him a place to do that, but it was a very slow toe in the water situation.

And I don’t think he even started as sales. He was just sort of someone who is like, “Ah, I might know some people that might want to do a video.” And that’s kind of how it began and Chris just went on to be insanely successful for us, outselling me by quite a bit, and really opening up just tons of doors for our company and taking it to the next level on, on every front.

Make Sure Your Video Person LOVES Video As Much as the Rest of Your Team

Jake:
So he really wasn’t a sales person. He was a guy that loved video.

Max:
He was an agency guy. He was an agency guy. He was from agency, there’s a big local agency in our town. And he was there and had moved up here to be part of that agency. And then it didn’t work out between him and the folks there, because Chris is a really gregarious, one of a kind kind of guy. And the company was kind of a very uptight agency. And so he kind of found a home with us and we were all kind of cowboys and yeah, he, wasn’t a sales person, he was just an agency guy, but he just was really good at talking to the client. He was really good at talking to the client and he loved the vision of making incredible videos for folks. And that’s what we were doing.

Max:
He really fell in love with the vision that we had at Hand Crank for the kind of videos we were making. And he loved the guys. He loved going on shoots. He just loved everything about it. And he just sort of dived in and made the most of it. And then initially, the first six months, I think his sales were just pitiful, nothing almost. He just could not close a deal to save his life.

Jake:
One thing I remember about Chris and to continue on that point, definitely, when I came along, he was selling big time so that must’ve just been the first six months.

Max:
Yep.

A Sales Person Can Help You Stay Focused on Solving the Client’s Problems Instead of Your Own

Jake:
But one thing I remember about him as, maybe this was because he came from the agency side, was he was always caring about what the client needed and solving the client’s problems.And he didn’t care, not to say he didn’t care, but he wasn’t worrying so much about what was happening inside the company with what producers on what shoot.  His focus was what’s the problem that the client has and how am I solving that?

Max:
Absolutely. I mean, and I think that came from agency, right. He wasn’t worried about what kind of camera he was going to be shooting on, or I mean, he wanted to make beautiful videos, but he kind of left that up to the directors, but, it was more about what does the client really need? And he would just stay uber, uber focused on the client in that regard. But he also, and I can’t repeat this enough, it was just his genuine love for making these videos for the clients, which I think is what made him really successful for us and then made him really successful when he went on and started his own company after we sold Hand Crank.

Don’t Call Your Salesperson a Salesperson!

Max:
It was also I think, key is he just was really smart from the beginning saying, “Don’t call me a sales guy.” Because people just go running from a sales person and he was like, “Call me an executive.” I’m an executive producer.

And so we did, that’s what we called him. And that’s what he did. And he wound up actually being what he was. He actually wound up being very, very involved in the creative of these films that were being made, sometimes writing the scripts, sometimes directing, so it wasn’t a fake name to call him an executive producer and not a sales guy, but it was critical, right.

Why Hiring a “Pro” Isn’t Always the Best Idea

The client wants to think they’re talking to the person that’s going to be making their film. They do not, do not want to talk to a sales person. And that was something that I don’t think I learned until later when we tried replicating what we had, when we wanted to go to the next level, we wanted to go past 2 million we’re like, “Let’s get another sales person, but this time let’s get a real sales pro.”And that just totally failed. 100% did not work at all. We got this woman who was very good at selling things had a really strong sales background, knew all the sales information. She loves selling things, but she just didn’t know video. She didn’t understand the product. She was never really going to be a director herself. And we put nearly a year into trying to work it out with her. And we just could not. She basically had maybe five or $10,000 worth of sales the entire time she was there.

Jake:
So it sounds to me to sum up what you want to look for in a salesperson, in our experience is someone who’s high level in making the video, but is involved in making the video, who’s coming at it from a client problem solving side, and don’t look for, and especially don’t call them a sales person.

Max:
Yeah. Don’t even worry about looking at their resume and, “Oh, what’s your sales experience?” It doesn’t matter. They could’ve sold a million printers and it will never have anything to do with what they’re going to be able to do for selling your video. If I were to do it again, I’d be looking at it and saying like, “What videos do you love?” And honestly, go look in agencies. Because it’s not hard to find people at agencies that are really unhappy because agencies can be really uptight places with just a lot of layers of bureaucracy. And it’s not hard to find a person at an agency, particularly one that loves video that wants a lot more freedom and a lot more latitude. And I hate to say, but production companies have a lot more freedom and latitude than agencies do.

So I think that when you find someone that kind of has a little bit of a renegade spirit but just loves the work. Obviously you have to be a real hard worker and everything, but that’s the main thing. And unfortunately, sales experience just matters for nothing. That’s what I would say is just get that type of person. And then you get into the question of okay, how are you going to pay this person? And I think that is also a very tricky thing to do.

How to Know When is the Right Time to Hire a Video Production Sales Person?

You need to have a certain level of income in the company already, a certain level of profit in the company already before you can even really start thinking about bringing the salesperson on, because it’s going to cost you a little bit in the beginning, and you’re not going to get anything back on it for quite a while.

Jake:
Probably six months. And you’re going to need that cash cushion in your company. You’re going to need the rest of your company supporting things in order to cover whatever you’re paying that person.

Jake:
And I would add that you need to be at a point where the company is running itself in some way that you can spend your time helping that new sales person with your runway.

Max:
Yes, but they also need to be a self-starter. They kind of find their own way of doing things. Chris really defined his own ways of doing things. And I just didn’t have the experience to really mentor him at all. So, I mean, honestly, for most folks out there listening to this, I think that you’ll probably wind up in the same position. Because he might be around $500,000, $700,000 when you can start affording this. Unless you go into some kind of partnership, which you definitely could do, I would say that could work too if you’re at a much lower level, but you’re like, “okay, you’re just going to share profits and just be in a partnership from the beginning of ownership of the company and the profits.” Totally could work.

But I’m just saying if you’re a sole owner and you like it that way, then you just have to be ready because you’re just not going to get anyone to work just for commission in the beginning. Because they’ll quit. So you’re going to have to be willing to put some money on the table for them each month, even when they’re not selling anything. One thing you can do to mitigate that I think I really recommend is send that person on a whole bunch of shoots. I mean, Chris would kind of be a PA, he had no ego about it at all. And that’s something else you want to look for is someone that that’s willing to go on shoots and just get down in the dirt and learn how it all works.

But that saves you money too because that’s an extra body on set that you’re not paying outside of that guy’s salary.

Jake:
Oh, I like that.

Let Your Salesperson Build Relationships

Max:
One of the things Chris was crazy about that we put forth a really professional vibe on the set with the client, and I think before he started, we did not do that. And by being on those teams, he saw that happen because Chris will tell you that it’s all about relationships. That’s how he did it. That’s always his answer. It’s like, “How did you do it, man?” And he’s always “Relationships.” But those relationships were based on constantly trying to make a really good impression. That was one of the really important things to him was making a great impression on the client throughout the process.

And he watched out for that. He owned that relationship and he owned that kind of on-set experience for the client and made it really rich for them. And that’s cool. Particularly with agency. Agency wants to have a good time when they go to a shoot and it’s kind of up to the sales person, the EP, the AE, whatever you want to call them, to give them that experience. You don’t have to have a lot of money. You just have to put out some m&ms and kind of care about them a little bit.

Jake:
Okay. They’re always worried about caring for someone else, show that you’re caring for them.

Max:
Exactly, exactly. It makes a big difference. And I think just in general that they know that someone’s looking out for them and he was really good about being that point person and that’s how he made those relationships and he would go visit them and he was so good at beating the street down in Seattle. Everyone thought he owned the company, not me and I was fine with that, but it was just because he was just really on it and happy to meet with folks and do all that kind of stuff. And like I said, it was just a really great relationship, but I think folks can copy that just by looking for that kind of person that is gregarious, loves film, willing to get down in the dirt, obviously willing to be flexible on pay.

How To Break Down the Pay Structure

I think later on pay, you can definitely work out. The pay structure that we used, I think he would get 15% of everything new that he brought in and then he’d get 7.5% percent of that thereafter. And then anything he got from a lead from us, we would get 10% for closing it and 5% thereafter and so forth. And that turned into some pretty good cash by the end.

Jake:
Let’s talk about pay structure from a broader perspective for a second. There are a few different ways that we tried and you talked about one that was just a simple commission on the top number, the revenue.

That we tried and that worked, like you said quite well. Another thing that we tried and you can try different things with different sales people as we did, but the thing we ended up with and correct me if I’m wrong here was based on gross profit rather than top line sales number. And the reason for that was to incentivize finding those profitable jobs and those profitable clients, as opposed to just any project.

Max:
That’s right. You’re right. In the end, we did sort of modify it to go off of gross profit and just to remind everybody that’s instead of just looking at the gross revenue of the jobs he brought in saying, “Okay, let’s just instead give you a much larger portion of the actual profit of that job.” And that is what we did Jake, for sure. We’ve probably should come back around to that in a different podcast where we talk more about different pay structure ideas.

Jake:
Sure. And I don’t know if that’s necessarily the one anybody would want to start with.

Max:
No, it was complex to do the math on. So Jake was our math master and our CFO. And he really would work out all these calculations for us. Without someone to do that, it would have been really painful. And also just to mind all that paychecks and everything. So that was definitely something later, but you’re right. It was a good idea because it did incentivize going for the more profitable jobs.

Find Someone Who Isn’t Afraid to Ask For The Right Amount of Money For the Job

Max:
The other thing I would say that Chris was really good at was asking people for a lot more money for the work we were doing. Maybe it was because he was an outsider, but he could see the value of what we were doing. And he was not afraid to ask for those bigger dollars. And that is what lifted us way higher was just that lack of fear of kind of coming in and saying, “Oh, I’m so happy just to be making a video for you. Thank you. I’ll do it for whatever you give me.” Which is my attitude to this attitude of like, “No, no, I’m looking at this in terms of the value it’s going to bring your company.” Amazon, Microsoft, whoever we’re making it for. And we’re going to price it according to that.

Jake:
Oh, I like that. First, solve their problem and think about the value of the problem you just solved. But don’t get stuck on your costs plus a certain number. It’s really about what value are you providing to your client.

Max:
At a certain point it is. I would argue that in the beginning you kind of do have to do your costs plus a certain number because you have no leg to stand on, but that’s again a different thing. But yeah, eventually I think finding the value and charging accordingly is perfect.

How Do You Know if Your Video Production Salesperson is Working?

Jake:
Okay. So let’s say I’ve listened to us so far. I decided to take on a salesperson. I’ve decided that my pay structure is going to be simple commission on the top of maybe a small 30K salary just to keep them floating.

Max:
Good luck with that these days.

Jake:
Hypothetically speaking.

Max:
No, I know. I hear you.

Jake:
What do I look for in the first six months? How do I know that it’s going well? You said that the first six months were pitiful so what kept you from giving up during those six months and what made you know even when sales were pitiful that it was still worth pursuing?

Max:
I think just watching him make these relationships. I think that there were just always the potential of some projects that were being worked on. We would meet once a week and he’d say, “Well, I got this one over here. I think it’s going to be about about $15,000. I got this one over here. It could be up to $50,000.” I remember he landed some big basketball training video session thing in the first six months that started really small. But ultimately it was about $150,000 in work over another year after that. So he was just hunting down anything and just watching that, they’re hunting this down and you’re thinking to yourself, “Yeah, that’s the kind of work we do. He’s on the right track and that’s who we are.”

And they’re going on the set, they’re just generally jiving well with the crew, I’d say those are the things you’re looking for, but they are meeting with you on a weekly basis and showing you a lot of ideas and groundwork, moving the needle with each one of those times. “Well, what’s going on with that client? How are you moving forward with that client? What’s this week’s little baby step forward with that client?” And along the way, we tried to come up with things, different pricing structures for our product and everything. And that was a huge failure, but we can talk about that later. But mostly it was just that he was so engaged. And so diehard working towards these different clients, probably 75% of whom did not work out, but just that 25% was just enough to keep him interested and keep me interested and ultimately made it all work.

Honestly, you’re just looking for little teeny gains, just little gains of saying, “Wow.” And in the beginning, I think I pointed him at a lot of clients like, “Okay, there is a client I’ve never been able to break down the door of.” And he would hunt it down. And I can’t tell you how devastating sometimes it was because he would spend endless hours on some of these clients and they would just ultimately be like, “Yeah, I don’t think we’re going to do video actually. Or yeah, we’re going to go with somebody else.” But sometimes he would just get that little thing. So I think it’s just being really, really ready to wait. But not waiting, meeting every week at least with them, having that sales meeting once a week where you just look at all the potentials, and say “What is the number for each one of those jobs. Oh, we think that’s $15k, we think that’s $10k.”

And it’s good to know what you think your profit on those might be too, but that might not come along until later. Just that you feel like that needle is moving. And that that group of potentials is growing. And if it’s not growing and if it’s just stagnant, let it go. Get out. They might be a great person. They probably are. But I wish we would have let go of that other person just way, way earlier for her sake and ours. Because we just kept on trolling along doing training and training and training, learn our product. No, there’s not that much training to do quite honestly, there just isn’t, you just dive in and get people stoked about making videos.

Jake:
So you got to have that self-starter.

Max:
You do.

Jake:
Someone that knows and loves video.

Max:
Get rid of it within two months if it’s not working. And you’ll know. You will know. But when you find that right person, it’s going to be awesome. You basically have to do that to move forward, to cross that million. You’re just not going to be able to get the kind of work that you want, I don’t think, unless you have that. And I mean he brought in Zulily, we did a national for them for a quarter million. He brought in Driscoll’s who we did tons of huge projects for. Capital One. This can work, so don’t be afraid.

Jake:
That’s kind of a nice thing to end on is what does that company look like after this person has started? What are the goals of that company? Is it that your revenue has doubled? Is it that you’re getting better work with larger clients? What are your goals? How do you know-

Max:
I think getting better work with larger clients always has to trump everything else. Because that’ll keep the esprit de corps high in the company and the money will follow. Obviously after that, you’re really watching your profit on those jobs, but better work with larger clients is going to naturally lead to bigger dollars for those shoots. And then you just have to watch that goddamn profit.

Jake:
That makes sense.

Max:
One kind of leads the other and honestly everyone will show up pretty stoked for work when they’re making a Capital One ad, it’s pretty fun, as opposed to, “Okay, let’s go make another car salesman ad.” Or something like that. Then it’s kind of a drag. And you’re just like, “Oh, it was fun five years ago. But I’m kind of over that now.” So it’s the bigger jobs, the better work gets everyone stoked, gets everyone happy. And it’s just a lot more exciting all around. And eventually, we’ll teach you on these podcasts how to actually make any money from those.

Jake:
I think we’ve had some great brainstorming ideas on salespeople, how to find them.

Max:
Yeah. Thank you, thanks everybody. Thanks Jake. That was fun. And we will see you next time.

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