Things to Remember Before You Start – Part 2
Avish: Alright, Fred, as people listening to this get more involved in this field, they may go out and start researching other people like yourself. But you want to remind everyone, you say Don’t Believe Anyone’s Numbers But Your Own. What do you mean by that and why?
Fred: Well, a lot of people will make a lot of income claims that are hype-y claims about all kinds of things in this business, and I’m, you know, I remain very skeptical because I’ve seen behind the curtain when I used to do a lot of seminars and see how people operated that are now big-shot gurus in the information marketing field. And I know that there are a lot of shenanigans that go on, and a lot of bogus income claims, and I only wish that my lawyers would give me permission to name names, but I can’t.
The problem is, is that the only numbers that you can be 1000 percent certain of are your own. So, you know, again, don’t think or believe mine or anybody’s numbers. Just concentrate on, you know, creating and understanding that your own numbers are the only numbers you truly know for real.
Avish: Okay. So when it comes into working with other people, you know, they say it’s called joint venture deals, which first off you want to explain what that means, but second off, talk about how you like to do your splits in terms percentages with them.
Fred: Yeah, well joint ventures are any deal where you and another person agree to work together in some capacity where you are working together and presumably splitting revenue in most cases. And, for me, that decision to work with people is one that should be considered very carefully.
In the old days, I used to sort of do deals with lots of different people. And I got burned because not only did they burn me, but they burned, you know, I had a guy one time, I don’t know if I told you about this, I had a guy one time show up at one of my events as a speaker and was actually a very, very smooth, polished speaker. Delivered great information, proceeded to sell a package to a bunch of people in my audience, and took their money and never delivered the product. So —
Fred: — by working with this person, yeah, and this person is still out there, and again I wish I could name names, because this person is fairly high profile. Apparently, he had some kind of an excuse, blah blah blah, whatever it was. But literally 9 months later, it took 9 months until he started doing some returns. I think he eventually returned the money on all, for all the people, but it took him close to a year to do so. Now associations like that, even though I’m not the person that actually did the dirty deed, I’m associated with the person. I was the person who put him on my stage, and therefore I look really, really bad in this situation like that. So, be careful.
Avish: You know, even on top of that, I’m sure that, well I’m not sure but I’m guessing you probably got some calls and emails about that situation, too, right?
Fred: You are 100 percent accurate. In fact, I got quite a few of those calls.
Avish: Yeah, so we got to be careful with that.
Fred: Yeah. So —
Avish: — so in addition to problems, let’s say you’ve picked somebody to work with. You make your, you like to make your arrangements 50-50, but not everyone in your position likes to do that, correct?
Fred: Yeah, there are a lot of people who don’t. In fact, just recently someone who I just deleted from our joint venture group online, our Facebook group, one of the things is that I tried to make the deals that I do with people fairly standard, so that, you know, if I just don’t like to have too many different kinds of arrangements going on out there. Other people I guess are happy with deals in which, okay, well we’re going to do a 23-77 split this time because I feel you’re only worth 23 percent. And I just get really, to me it’s very, very difficult to start to create different deals, different models for different people.
So I’d prefer, and I, my model is just to have one deal, which is if I’m working with people it’s a 50-50 split. And the reason why that works for me is the accounting is really, really easy. The concerns that people have is, you know, is the, are the efforts exactly equal? Well, you know, it’s sort of like in a marriage. It’s supposed to be 50-50, but usually at any one point in time, one person’s doing 70, the other 30, and then it flips for something else.
So I just think that, for me, creating a 50-50 deal is the only way to go, because all of the deals that I have with everyone then are the same, and I don’t have to try and think about what is the deal that I offered someone and how is this different, et cetera, et cetera. It just makes it infinitely easier. Again, I admit there are many people who don’t follow this methodology, and I guess it worked for them, but it doesn’t work for me. So that’s what I do.
Avish: Okay, and if it seems like it’s going to be different, you actually try to structure it workload-wise so it will be equal, right? Because some people bring equity, whereas others bring contacts, and so and so?
Fred: Yeah. So in other words, I like to make it so that a person, when everything’s said and done, whether it’s the amount of work being done or the expertise being offered, that at the end of the day the person who I’m doing a deal with feels very, very satisfied. And the question I often ask is, you know, if one month in the future we generate $10,000, will you feel uncomfortable sending me $5000 of that $10,000? And I sort of ask them to picture it into the future, and whether or not writing that check for five grand is going to make them feel uncomfortable. If it is, we have a problem.
But, you know, even maybe at the time there might not be, but later on somebody might have hard feelings. But I like to try and prepare people mentally for writing me a check for 50 percent of the amount, and making sure they don’t feel like they’re being taken advantage of.
Avish: Right. And then, well, what about the reverse? You know, there are situations where you’ve gotten into that 50-50 partnership but you felt like, you didn’t feel comfortable receiving only $5000 out of that check?
Fred: Well, you know what? I think that, you know, and this is another principle that I always talk about, which is, and it’s one that you’re going to see that we have on the list but it’s worth discussing here, which is that 50 Percent of Something is Better Than 100 Percent of Nothing. Which is, I try and structure deals so that often times the person that’s my partner in that deal is actually getting the better, you know, the better 50 percent deal. In other words, I may be doing more of the work or providing more of the expertise. I would rather have it be that way and feel like, you know, sort of they’re getting a little bit better deal than I am. And that’s fine, because, you know, in the long run, it’s, you know, it’s all good.
Avish: Well, this is a nice segue way into the next idea thing to think about before you get started on this, is ethical considerations in the information product marketing. You know, a lot of people are going to come into this, you know, maybe with ideas of getting rich quickly or anything like that. So what is it about ethics and integrity when it comes to information product marketing?
Fred: I guess that this is one of those choices that you have to sort of make right at the beginning. And I have been around a lot of information marketers whose level of ethical considerations is virtually zilch. I mean, they just don’t care. It’s all about making money. They don’t care who they hurt, who they lie to, what they say, what kind of claims they make. And frankly, you know, forgetting about whether or not I’m trying to be a Boy Scout here or recommend that others do the same, I mean, I’m thinking about, you know, jail time. I don’t want to go spend time in a cell with Bubba. And I’m really concerned about making sure that I operate my business in such a way that I have zero chances of ending up in jail. And I just think that if you think that way, you know, in addition to doing what is morally and ethically correct, I think that everybody should be thinking about the fact.
I mean, you know, recently we had a case of some guy who ran a seminar where he puts people in a sweat lodge and killed a few people. Now it’s debatable how much liability he actually had, but you know what? This kind of stuff, you know, thankfully in most cases we’re not talking about life and death matters for our customers.
We’re talking about whether or not you’re going to take advantage of them, take their money and then not deliver on the products. I think that that just, you know, it makes me really uncomfortable because, number one, it just doesn’t feel right ethically. And the other thing is, that the authorities are becoming a lot more concerned and are going after people in this field if they play games like that with customers.
So, not only is it a good idea just, you know, too, from a karma principle to do what’s right, but it’s also good idea from the standpoint of the law. And I think if you stay as far away from doing sort of sleazy crap as possible, you’ll have less chances of ending up in jail, and you’ll sleep better at night.
Avish: So just to, you know, obviously the life and death one is the extreme case, but just so people are aware, some of the unethical things that various information marketers might be doing, do you have a couple of those examples?
Fred: Well, yeah. I mean, you know, I’ll tell you, I’ll give you one example, and this is the most blatant example I’ve ever seen, of something that just really stuck in my craw. And I was tempted to try and out the person, but I couldn’t do it because my lawyers actually said that, you know, that it was a bad idea to try and make this public, but here’s an example.
So I get a brochure in the mail from someone telling me that there were 47 units of a specific product available, and only 47 units. Now that was at the very front of the brochure. It was about an 8 page color brochure, and by the end of the brochure, magically the number had shifted to 48. So somehow within my reading the brochure, they found another item, so 47 products were now 48 products. I then contacted these people via email and said, hey, you know, I’ve got a big event coming up and it looks like I might need 50 sets of these. Can you make 50 sets available to me?
Now clearly that’s more than what they said were available. They responded within a matter of minutes and said, oh absolutely, we can give you 50 sets of the material, which is in direct contradiction to what their brochure told me. So, in other words, their claim that there were X number of units available, in actuality was just a ruse. It wasn’t real. And so when someone like me contacts someone like them and gets a quote for 50 units when actually 47 or 48, depending on which side of the brochure you believe, are available, it leads to the question or begs the question, well, you know, is this, is everything that they do just some kind of a scam like this?
And I think that that’s the most blatant example that I’ve ever seen, which is, you know, customers, especially when they get hip to what you’re doing, aren’t going to believe a word of what you say and in the end analysis it’s going to be you who’s going to be hurt. So, for example in a case like this, had I called up and they said no, we only have 47 units of this, we can’t sell you more than that and in fact 8 have been sold already, so we really only have 39 available, whatever the number is, then I would have been much more prone to believe them. I’d be much more prone to buy that product and any other products that they offer. So, you know, doing things ethically, morally, not only pays off in terms of being able to sleep at night, but it also helps you build up points with your customers for being authentic, real, and honest.
Avish: Wow. That is great advice for anyone, Fred.