Build a Badass Business Podcast #26A: [Interview] Business integrity with Erich Krauss, owner of Victory Belt Publishing

Build a Badass Business Podcast | Diane Sanfilippo

Build a Badass Business Podcast | Diane Sanfilippo

Topics:

  1. Introducing Erich Krauss [2:34]
  2. Transitioning to paleo publisher [8:11]
  3. Focusing on the client [16:46]
  4. Hustle and grind [25:02]

Erich Krauss is the owner and President of Victory Belt Publishing, but his position in life wasn't always on top. He started with modest aspirations to be a writer, and did become one, only not in the genre he expected at first. His dream to be a writer led him down a path to learning the ins and outs of the publishing industry, which, to his surprise, wasn't quite what he expected.

When Erich discovered that, in the majority of cases, authors barely makes any money from the sales of a book (and that the books are often edited and changed to not be exactly as the author wanted or intended) he decided to take matters into his own hands to start a company with different values – focused on the authors.

His story is inspiring and motivating as Victory Belt has become the #1 Paleo publisher there is today. The company is also the publisher with the highest ratio of New York Times bestsellers – often with multiple books on the list at once, crushing the competition.

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Build a Badass Business: Episode # 26A: [Interview] Business integrity with Erich Krauss, owner of Victory Belt Publishing

Coming to you straight from Las Vegas, this is Build a Badass Business with Diane Sanfilippo. Diane is a New York Times bestselling author and serial entrepreneur. She’s here to teach you how to grow and develop a successful business you love, and how to create raving fans along the way. Here she is, your host: Diane Sanfilippo.

Diane Sanfilippo: Hey guys. The interview you’re about to hear is one I recorded last week while I was visiting with my publisher and his wife. Scott and I were there in Las Vegas, and we kind of riffed on a whole bunch of ideas about entrepreneurism as well as running your company, and it ended up being a very long conversation, so we’re breaking this one up into two parts. Hope you enjoy.

Diane Sanfilippo: Alright, welcome back to Build a Badass Business. Today I’m back with another interview; another friend/colleague/boss? Of mine.

Erich Krauss: I would not say boss.

Diane Sanfilippo: {laughs}

Erich Krauss: If there’s anyone a boss here, it’s definitely you.

Diane Sanfilippo: When I interview my other former boss, Dan coming up soon, that will be interesting. These two actually have a lot in common; Dan and Erich have a lot in common. But I’m going to introduce Erich; he’s the president/owner of Victory Belt Publishing, and I’m here in Las Vegas right now. Scott and I are driving through, moving from New Jersey to San Francisco, and I said come be on a podcast. I’m going to interview you about your journey a little bit starting the company, because I think a lot of people assume that having success and being, I guess the number one paleo publisher at this point, right? The most paleo books on the New York Times’ list?

Erich Krauss: Yeah, actually.

Diane Sanfilippo: At the same time.

Erich Krauss: The highest ratio of books published to New York Times’ best sellers out of all publishers.

Diane Sanfilippo: That’s insane!

Erich Krauss: Yeah. At least, at least that’s what I think. I haven’t actually done the research, but if you look at the monthly list, it seems to be.

Diane Sanfilippo: So for the amount of books that you’ve published, the percentage that have become New York Times’ bestsellers.

Erich Krauss: Right. Highest ratio.

Diane Sanfilippo: Highest ratio. I believe that. So why don’t you just introduce yourself? You have a very long history of lots of different careers, but people listening to this show, a lot of them are emerging or existing entrepreneurs and story of I guess struggle and what motivated you to start a company that then would; of course you didn’t know what it would become.

Erich Krauss: Sure.

1. Introducing Erich Krauss [2:34]

Diane Sanfilippo: But what were you doing before you started Victory Belt, and talk a little bit about how that started? And maybe before, not the whole time before, but just kind of leading up to it and really what it was even before it was kind of the paleo publisher, because it wasn’t always that.

Erich Krauss: Yeah. I honestly think that anything I can talk about is just doing what you know, and finding an outlet to monetize something you know. So I started out, I just wanted to be a writer. And that was my primary goal when I graduated college at 21. I said, I’m going to be a writer. So, one I had to learn the craft, and two I needed world experience. So basically from 21 to 29 I spent that entire time touring the world. I lived with the Indian tribe in the Amazon, taught hang gliding in Guatemala; I fought Muay Thai in Thailand, lived in Africa, pretty much everywhere just trying to build life experience. When I wasn’t traveling, I was spending about 8-10 hours a day writing. And it was just to learn the craft, and my whole thing was fiction.

The part that your readers, or listeners, might benefit from is, after those 8 years, I said, ok I can’t just keep writing in a basement and working odd jobs to travel to other countries. I’ve got to find a way to make money, make a living at this. So I went to a writer’s convention. My goal was to sell my first fiction book. I did research; basically these writer conventions have publishers from New York all around the country that come, and the idea is that the writer will present their material. But the publisher is going there for vacation.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: So very rarely do they pick up new authors at these conventions. It’s really for publishers to go, or editors to go, get a vacation.

Diane Sanfilippo: {laughs}

Erich Krauss: I know the editors now, and they dread these things. They’re like, oh I can’t wait to get out. Because very rarely do first time writers have good stuff to show them. So, I read up how to present myself at these things. They say, you know, write up a resume, don’t do anything fancy, don’t do anything out of the normal, make it just a carbon copy of everyone else’s. And I said, oh, well I’m not going to stand out at all. So I broke the rules there, and I put a picture of me kickboxing in Thailand onto the proposal. And while no editors would read my fiction.

Diane Sanfilippo: {laughs}

Erich Krauss: I had an agent there who saw my picture and was like, oh you do this MMA stuff, and I said yeah, I trained with a lot of the UFC guys. And he said, well I’ve always wanted to publish a book on this. This was back in 1998 or so.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: So I land an agent because I broke the norm, but his thing was, I’m not going to represent your fiction. If you really want to be a writer, you have to write anything you can. So I thought, ok, my goal was fiction but I’m not going to be stubborn and just stick within the fiction genre. He said do nonfiction, get a following, get some books under your belt.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: Because the idea is, if you can publish one book, other publishers will look at you. It’s the first book.

Diane Sanfilippo: I can attest to that.

Erich Krauss: Yeah. It’s like no publisher wants to look at someone’s first book. Even if they did one book before, and it didn’t do great.

Diane Sanfilippo: Good thing you did! {laughs}

Erich Krauss: Yeah. Well, it’s a little different market now a days.

Diane Sanfilippo: Yeah, it is different.

Erich Krauss: I ended up, his idea was to write a couple of fiction books, and then move into nonfiction. Well I ended up writing 30 nonfiction books. Or write one nonfiction book and then move into fiction.

Diane Sanfilippo: Wow.

Erich Krauss: And I ended up writing 30 books. How it translated from there was, I did one book that sold really well, and I saw what the publisher did. They got the back flap copy wrong, they designed it horribly, and I thought, oh I can do this better. I also looked at the cover price, and I looked at the copies sold, and I’m like, I’ll be rich if I start…

Diane Sanfilippo: {laughs}

Erich Krauss: Little did I know only a small fraction actually goes to the publisher.

Diane Sanfilippo: To the author you mean.

Erich Krauss: Yeah, to the author. Or no, to the publisher.

Diane Sanfilippo: Oh and to the publisher.

Erich Krauss: Yeah, when you see the cover price, you think, oh as an author I’m making this percent, the publisher must be making the rest.

Diane Sanfilippo: No.

Erich Krauss: But it’s all down the line, yeah it’s a very small percentage. So I ended up starting a publishing house based upon what I knew, which was writing, and my whole goal was to be author friendly, so you don’t edit, butcher an author’s work, which has happened to me numerous occasions, and let the author have the creative process, and then also pay more royalties and just do a better product. We started out in the niche I knew, which was martial arts, so we worked with all the top UFC guys. We had a bunch of really strong selling books, and then, I don’t know if this is kind of veering off, but when it comes to publishing, I thought, ok no one is going to attempt to write what they don’t know about.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: You should stick within the subjects you know; so you always hear, as a writer, any advice you get is, stick to what you know. So I figured I’d take that and apply it to publishing. And I think that’s the biggest problem with the traditional publishers, is you have editors that are editing a cookbook and a horseracing book and a gambling book.

Diane Sanfilippo: {laughs}

Erich Krauss: They don’t really know any of the markets; all they know is, hey this topic is hot, let’s do a book on it. So either they don’t find an author that really understands that market, or they butcher the author’s writing to what they think is going to sell.

Diane Sanfilippo: Yeah.

Erich Krauss: So my motto was, if I want to be the best publisher, I stick within genres that I know a lot about, and it actually translated perfectly. Because in all the niches we’ve gone into, we’ve had the bestselling books.

2. Transitioning to paleo publisher [8:11]

Diane Sanfilippo: So after the MMA books, what people or what was the transitional period.

Erich Krauss: Yeah.

Diane Sanfilippo: I’m pretty sure it was Robb Wolf was the, that was kind of the turning point from MMA.

Erich Krauss: Sure.

Diane Sanfilippo: And the connection there. I knew, was it Glen that was training with him?

Erich Krauss: Yeah, we were living in Chico, Glen and I were writing all the; this is when I first started Victory Belt. I was writing, editing, designing, and publishing all the books. Obviously we grew, our books went crazy after that, so in the process of doing that, I gained a bunch of weight, I got super unhealthy. I was working 16-17 hours a day, and Glen was a fighter still, and I had stopped training martial arts at that point, just to take on publishing full time. Glen was training with Robb in Chico, and he’s like, you know this paleo thing, Robb’s got me on this paleo diet. And I met Robb, his Crossfit gym at that point was out of the same gym where I was training Muay Thai.

So it took, with me it’s always some time. It took me several months to believe; and I realized my health was getting to a point where I needed to make some changes. So I went whole hog paleo, just the way I do everything is just full glory.

Diane Sanfilippo: You have to really convince you, and then as soon as you’re convinced, you’re like 100%.

Erich Krauss: I’m convinced, and it’s like the next day, oh, “why don’t you have this cookie?” “I can’t eat cookies, it’s not on paleo diet.”

Diane Sanfilippo: {laughs}

Erich Krauss: I went insane. Like, literally, I went too far with it you know?

Diane Sanfilippo: Mm-hmm.

Erich Krauss: I restricted my diet too much. But I mean I went hard core paleo.

Diane Sanfilippo: But Glen was; I remember hearing Glen’s name when I went to Robb’s Paleo Solution seminars.

Erich Krauss: Yeah.

Diane Sanfilippo: Because he was talking about how paleo works for athletic performance, so I had actually his name.

Erich Krauss: Yeah, Robb used Glen as a case study.

Diane Sanfilippo: Yeah, I remember that.

Erich Krauss: In a lot of his early, early stuff, because Glen is a superb athlete.

Diane Sanfilippo: And he’s the one who also, he co-author’s a lot of books too.

Erich Krauss: Yep.

Diane Sanfilippo: He’s co-authored with Kelly Starrett.

Erich Krauss: Yeah, he’s written Supple Leopard now, and Bryan McKenzie, Power, Speed, Endurance. He’s got DeskBound coming out. And then he’s worked with all the UFC greats like Randy Couture, Anderson Silva, all the big named UFC guys.

Diane Sanfilippo: So this is like that connection, back in the day before getting into the whole paleo thing.

Erich Krauss: Exactly.

Diane Sanfilippo: You were just sticking to what you knew and what you were passionate about in your life.

Erich Krauss: Yeah.

Diane Sanfilippo: And then…

Erich Krauss: Well the reason we worked with Robb is because I went on the paleo diet, and almost instantly, because my diet was so bad, I got down to like 5% body fat. It was weird, when I made that transition, within a matter of 3 weeks I lost so much weight, I looked better, I felt better, and maybe it was other aspects going on in my life in addition, but when I first went paleo, I had the biggest gains in training and weight loss and everything else. So right then I was sold, so I was like, all about Robb.

Diane Sanfilippo: {laughs}

Erich Krauss: And I’m like, this book. I said your book if it can do for the masses what it did for me, it will be a huge seller. So we got Robb on board, and yeah. That’s when paleo…

Diane Sanfilippo: Pretty much the rest of that is history. I mean, I remember when I got one of the advanced early copies of Robb’s book because I was at seminar.

Erich Krauss: Mm-hmm.

Diane Sanfilippo: It wasn’t sent out to anyone.

Erich Krauss: Sure.

Diane Sanfilippo: He had a case of it in New York at one of his events, and I remember I read it on the plane home. Which I had already been to two of his seminars, I guess, at that point, and then I remembered Sarah Frogoso’s book, Everyday Paleo.

Erich Krauss: Yeah.

Diane Sanfilippo: Because she was a trainer at Robb’s gym, and had done the whole paleo thing with her family. And that was really the first paleo cookbook, was Everyday Paleo.

Erich Krauss: Yeah, absolutely.

Diane Sanfilippo: I remember when I was selling both of those at my seminars before I had a book {laughs}.And I was calling up Victory Belt, like, can I buy these books to sell? And I remember, it was Linda, but I remember, she was like, I don’t understand what you want to do.

Erich Krauss: Yeah.

Diane Sanfilippo: {laughs} She didn’t get that I was like, I’m trying to teach about paleo, and I need some books to sell here. She’s like, alright. Yeah, that’s nice, thanks. And I remember seeing that. And the next couple after that; Paleo Comfort Foods and Make it Paleo, and I remember I had been in touch with you basically as soon as I got Everyday Paleo. I was like, you know I think could do something like this, but I think I could do something that’s kind of almost combing a lot of the science stuff and the recipes and all that. I remember you were just super open minded to it, and I’m curious.

So your perspective; which I think this is relevant for a lot of business owners who, for you to be author-centric is kind of the perspective I have with my business, but being very customer/consumer-centric.

Erich Krauss: Sure.

Diane Sanfilippo: Like I think so many people are in their business, and yeah focusing on the bottom line is important. You have to earn money, you have to earn money or you’re out of business. But, the means to earning money for people will always be different, and what you do in the wake and the way that you treat people in the wake.

Erich Krauss: Sure.

Diane Sanfilippo: So for you, I know as being an author before the publisher, that was the number one thing.

Erich Krauss: I learned a lot, because I came from a unique perspective in that, the people I was trying to sell something to, I was that person. I was an author, and I knew how frustrating it was when my publisher would just make changes in my book and give me the manuscript and say, that’s it. We cut out, I remember I did a book on the Tsunami in 2004; they said, oh we cut out 40,000 words from your manuscript because we want it to be a certain page length.

So for me, those are the things that, and they were telling me about how my market, what they knew, and it was wrong, but they were the king because they’d been solidified for 100 years, and that’s just passed down from one publisher to the next; how you do things, how you treat authors. And I can see it now; it creates a lot of problems when the authors kind of take the lead on stuff, but those are problems that are going to make your business grow. You deal with them as they come in. Like authors having ideas that you know might not translate great to sales, but you work with them. You don’t just cut them off. And you let them basically be your boss.

Diane Sanfilippo: And it’s a new market now, too, because I think the way books used to sell, with the boom of blogs and blogs becoming books…

Erich Krauss: Oh yeah. Changed everything.

Diane Sanfilippo: Yeah, it’s really different. I think it’s kind of funny, because I remember when we were talking before I ever had a book contract or any of that, it was almost like, well I didn’t have people coming after me for a book or anything.

Erich Krauss: Yeah.

Diane Sanfilippo: And I’m pretty sure it wasn’t; I don’t know, I don’t remember it being much of a hard sell, or any of that. But I do know that your perspective was so much like, let me explain to you why what we’re doing here and what we’re going to do with you is so great. But I had no concept of how crappy the other side could be.

Erich Krauss: I know, that’s.

Diane Sanfilippo: And so, I think that’s kind of common for a lot of authors. And actually now, a lot of the author’s in our genre have no idea what it could have been like, to the negative side of things.

Erich Krauss: Sure.

Diane Sanfilippo: And their experiences have been really positive.

Erich Krauss: Yeah.

Diane Sanfilippo: I know working with Victory Belt, I basically, anybody who asks me, I’m like yeah, if you can get a deal, it’s great to work with you guys. But then I definitely have had other publishers knocking down my door.

Erich Krauss: Sure.

Diane Sanfilippo: Ever since the first 3-6 months of Practical Paleo being out, and I’m just like, I’m not really interested. You know?

Erich Krauss: Mm-hmm.

Diane Sanfilippo: And even if they want to make some kind of crazy offer, I’m just not confident that the whole situation will pan out.

Erich Krauss: Sure.

Diane Sanfilippo: The way that I like to control things.

Erich Krauss: Yeah.

Diane Sanfilippo: And actually, I think that ties in really well with what you’re saying about letting the author kind of be the boss if the type of people that you’re going to have books from are running their own business, they’re not writers. We’re not writers.

Erich Krauss: Yeah.

Diane Sanfilippo: We’re business people; we’re entrepreneurs. So we do have a lot that we offer in terms of how we market the book and all that. So it’s kind of a different world.

Erich Krauss: Yeah, it’s different because my whole life, or at least my whole adult life, I wanted to be an author.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: So trying to get a book deal was my goal for 10 years. And now with bloggers, they might not have even thought about a book, but they have a product and they have a platform, which could make a very good book. So they go into writing a book. It might not have been their life’s passion, but suddenly they can get a book deal where as a guy like me who spent 10 years writing in a basement 10 hours a day, that first book deal means the world, even though it might not, the advance was terrible, the royalties were terrible; but at least I got a book out on the market.

3. Focusing on the client [16:46]

Diane Sanfilippo: So what do you want to say about how you think your perspective on treating authors a certain way, and kind of approaching your business as being very author-centric. So again, for people listening, to me this is about being, it really is being like customer-centric, to me, because you’re being customer-centric through the author, who you know is exchanging on their frontlines with their customer.

Erich Krauss: Sure.

Diane Sanfilippo: So we talked about things I want to put in the book, and you’re like, ok that sounds like your customers are really going to respond to that, so we’re going to do that.

Erich Krauss: Yeah.

Diane Sanfilippo: It’s not like, I know better, I’m the publisher. But what do you think has happened in terms of how that really sets you apart from your competition or what you have seen going on that other business owners can look at, like, ok there’s all these people in the marketplace and maybe they’re cutting corners on cost of things, or they feel like, ok the right thing to do is to have a green business. Or whatever it is. This whole topic can translate; if you’re sitting there with your business and you’re like, well I think I could make more money this way and do it my way, or I could take care of these people in the process.

Erich Krauss: Yeah, ok.

Diane Sanfilippo: Who sits in the house with their publisher and is like, we’re just going to visit. Who does that? {laughs}

Erich Krauss: Well I think it goes; there’s two ways to look at publishing. If you talk to other publishers, they look at the bottom line. They say, ok, on this book, let’s use this paper because it will save us 20 cents and we’ll make this much more. What they don’t look at is how it’s actually going to affect the sales of the book. Because they have this disconnect, where it goes from quality to profit. So they’ll sacrifice quality, like it’s not going to affect, no one is going to care. But people do care. Our books are all, the vast majority, in the 34 to 39; we even have a $60 book.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: And where we said is, make the author happy first. Make it their project; if they’re happy with it, that excitement is going to translate to their followers.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: Then you put whatever money you need into it to make it a super high quality book. Because if you cut corners; if I pick up a book at a book store, and it’s cheap paper, the author is not going to be happy because they’re looking at this book and they’re like, I put a year of my life, or a year and a half of my life into this product, and look. They cut costs. They printed it in Singapore, and the pages don’t look good, and they have one photo for every 3 recipes. So, my philosophy is, if you cut corners there, it will affect your profit, because less people are going to buy the book.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: So my idea is make the author happy, and do such a high quality book that anyone who picks it up is going to recognize it as a high quality book. One, your brand is going to be associated with high quality products, but the author is going to push it that much more, people are going to give good reviews. Sure, the price tag might be slightly more expensive to make that profit that you need to make, but for us we’ve never seen; we don’t offer $14 books that were printed in Mexico. We just don’t do. And we’ve been the most successful publisher in paleo, and in the markets we’ve been in. In martial arts, no one could compare to our sales.

Diane Sanfilippo: So what are some of the downsides then, of course there are downsides.

Erich Krauss: Sure.

Diane Sanfilippo: And I know we’ve had a conversation like you and I working on books or whatever, and you were always trying to make sure I’m really happy with the book and…

Erich Krauss: There are downsides, and I can say that. So when you go into anything; let’s say when I was an author and I went into Harper Collins or Rodale, all these other publishing houses I wrote a book for, even after I had New York Times’ best sellers, you kind of take on your surroundings. So I went in there, and they said, this is the way it’s done. And all of a sudden in my brain, I’m like, ok this is the way it’s done. So when they’re not answering my emails, or they’re cutting corners on material or design, I just assume in my head, this is the way it’s done.

When you offer everything to your author, they go into their first publishing experience; oh I have total control, this is the way it’s done. So that carries over to all aspects, and does create a lot more workload for you in general. So setting up the way you handle things, a lot of people won’t even notice if that same person had gone into a traditional publishing house where they don’t have any control, they would have taken it with a grain of salt. They might make them feel a little bit negative about the situation, but they just assume that this is the way it’s done.

So you can set up a foundation in your company when people are coming in, they just expect it to be that way from then on out. Which creates a lot of work for you, for your company, and can lead to extra work.

Diane Sanfilippo: I almost think that, maybe not on a huge scale, but on a small scale, the way that you run this company and now looking at a lot of other bloggers becoming authors in this genre or other genres, it’s created a little bit of a shift where I feel like it’s forcing some of the bigger publishing houses to become at least slightly more author-centric, because people are getting to the point where they’re like, well if I have a platform, I have more to offer than in the past. I feel like in the past it was really about the publishing house to do that work for you, of getting the book out there and doing that, but really that shift in the last 5 years or so.

Erich Krauss: Yeah, what I see it’s forcing them, they just throw money at it. So they don’t change the way they do things, they don’t change their royalty structure, which is a lot lower than we offer, so if you feel like you have a market and a publisher is willing to offer X number of dollars, if you went with a higher royalty rate, you would still sell those books and you would make more on that advance that you would get through whatever house is offering you this. They’re not dumb; they’re not going to offer you more than they think you would make. They’re smart, and they’re saying, we’re going to give you less royalties, so you’ll make less per book. Let’s say you sell 100,000 books, that will pay off the advance and put the rest of that money in their pocket instead of yours.

If you chose with a smaller advance or no advance, but high royalties, and you sell that 100,000 copies, you’re going to do a lot better than if you had taken that large advance. It’s all a gamble then. So, some authors are like, ok I’ll just get this paycheck. If I sell a million books, I’m going to be screwed because I’m going to lose a lot of money. But it’s a safe bet. Versus if you’re really confident in your product, and your confident in your publisher, take the higher royalties, sell those 100,000 copies, and make twice or three times the amount of money you would elsewhere.

Diane Sanfilippo: I just could never understand, unless you’re like Danielle Steel and you're taking an advance because you're going to do the work, and then it’s going to pay and whatever, I personally couldn’t understand getting paid for something that’s not really selling yet. I understand that you might have a period of time during which you're not getting paid elsewhere because you're working on the book. I can understand an advance covering some of that time, but as somebody who is an entrepreneur.

If I think about somebody giving me a huge amount of money; where does my motivation go once that money is in the bank, to then promote the book?

Erich Krauss: Yeah, especially when your royalties are small.

Diane Sanfilippo: Well here’s there other thing, too; say you get paid up front. Your motivation kind of slacks. Then if you don’t live up to the sales that were expected of that book, because I’ve seen this happen too.

Erich Krauss: Yeah, oh yeah.

Diane Sanfilippo: Everybody has seen it happen; someone gets a huge advance, there’s a huge expectation, you don’t live up to it, good luck writing another book.

Erich Krauss: Yeah. That’s true.

Diane Sanfilippo: So that’s definitely happened.

Erich Krauss: It’s basically, this is the way I would put it. If you somehow talked, you don’t have a big market and you don’t think your book is going to do good, and you somehow talked a big publisher into offering a large advance and you know it’s never going to earn out, take it.

Diane Sanfilippo: {laughs}

Erich Krauss: Because that way you are laughing to the bank. But if you think your book is going to be; for example, I did a book through New York House, and we got a very large advance, and we ended up selling 150-some thousand copies, and I did the math of had we gone with my royalty structure, I would have made twice as much as that large advance. Instead, we got the advance, and we only made like $20 or $30,000.

Diane Sanfilippo: And for some people, I guess bird in hand.

Erich Krauss: Yeah, sure.

4. Hustle and grind [25:02]

Diane Sanfilippo: They’re like, I’d rather know that I have that and hey, different strokes. So what else about kind of running the business and being an entrepreneur. I think there’s a lot that I would like for people to hear about the grind and the hustle part, because this is something that I talked about on a recent podcast, and I know there are a lot of people out there; and I’m just going to lay the groundwork for this and let you riff on it.

Erich Krauss: Ok. So this is the first off, one is, stick to what you know, but don’t be so pigeon-holed into one aspect of that. For example, with me, with fiction. If I had said, no, I’m not going to, my goal was to write fiction. If I said, I’m not going to do anything but fiction, truthfully I probably never would have been published. I said, ok, I want to write fiction, but first and foremost I’m a writer. So there’s other ways that you can not get your exact niche, but stay within the realm, and then succeed in what you want to do. So you have to be willing to sacrifice this direct focus onto one aspect. If you could broaden it a little bit.

Diane Sanfilippo: Say yes to something that someone is offering you.

Erich Krauss: Say yes that still falls in the niche. So let’s say you want to start a business and you want to sell water bottles, right? But water bottles aren’t selling, but you could sell coffee mugs, right? Your direct focus is water bottles, but if you’re willing to branch out a little bit and go where the market takes you, you can be successful at what you want to do.

Second is, don’t get too big for your britches right away. Don’t think, ok I’m going to hire all these people, I’m going to get investors. Do it yourself. Start small. Go work a job until you earn the money yourself. Don’t take a loan from the bank, and then just grind. I used to work 16-hour days, 7 days a week. Literally, I would pass out at my computer.

Diane Sanfilippo: {laughs}

Erich Krauss: And this is both when I got my first book deals and also when I first started my company. And then as you grow, then you bring on people that you can help and then you start bringing on things that you need to take workload off your back. But so many people think they’re going to start their business, hire all these people and create a big business out of scratch. Chances are, 99% of times, that’s going to fail.

Diane Sanfilippo: I think I’ve seen, what I’ve seen most people who are successful to a certain level where it’s reasonable, and it grows, and you can maintain it, it is starting small, and doing the work, and doing the hard work and hustling. What I was going to say, too; a lot of people listening have internet based businesses where there may or may not be a product involved, and a lot of people are trying to listen to advice from a lot of other marketers, or whatever. And they’re like, here’s the perfect way to start your business, you have a business plan, you create the website, you have these email lists and these funnels, and every perfect step to build your perfect business, you know?

Erich Krauss: Yeah.

Diane Sanfilippo: And I’m like, I didn’t have any of that to build what I was doing.

Erich Krauss: Yeah sure.

Diane Sanfilippo: I was kind of just rolling with whatever came my way, saying yes to things, figuring it out as I went along. Nobody; I had very little advice from people. A couple of people were like, hey you should probably try this. And I was like, oh, well that person’s really successful, I’m going to listen to that.

Erich Krauss: Yeah.

Diane Sanfilippo: You should probably, you should sell that on an affiliate network. Don’t try and just sell it yourself. Ok. That was one hugely valuable piece of advice. So are there people who came along as you were starting Victory Belt who were like, you know, you should really do this because you’re going to run into trouble, and then you just kind of did your own thing, didn’t really listen, and you were like, this is what I needed to do.

Erich Krauss: I think from a business standpoint, yes. When it comes to a publishing standpoint, absolutely not. As we were going along, I’ve had the bookstores tell me I was crazy 50 times. For example, we come out with a $60 book. They said, you're crazy, this book will never sell. Went on to be a New York Times’, Wall Street Journal, International best seller at the $60.

Diane Sanfilippo: Supple Leopard?

Erich Krauss: Supple Leopard. At a $60 price point. So the reason I didn’t; because all the stuff I could have gotten advice from editors at Harper Collins, Rodale, all the places that I’ve done books through, obviously they could give me advice on how to run a publishing house. But then I’d be falling into their business model.

Diane Sanfilippo: Right.

Erich Krauss: And their business model, my sense of why I started Victory Belt in the first place, was to try to do things different. But then there’s the core principals you can’t overlook. Because some things like profit and distribution fees and those things, you can’t get around. That’s just a part of the business. So yeah, I got a lot of helpful advice, and it’s go to people that really understand that business, who have been successful at it, and take everything with a grain of salt, because I’ve come to learn everyone likes to give advice, whether they have advice to give or not. So sometimes it’s bad advice, just because they want to be helpful.

Diane Sanfilippo: Yeah.

Erich Krauss: My dad was hugely, he had a business for 50 years, so on the business side he was very instrumental in getting all that worked out.

Diane Sanfilippo: I think too, when people are going to take advice from other people in business, I think it’s important to look at, is there success or level of success or how they’ve seemed to have gotten there or what they’re doing, is that something you’ll want to emulate. Do they understand what I’m trying to do here, and also, when I see some people. Of course, I’m going to put information out to try and help people avoid certain problems I ran into, right?

Erich Krauss: Yeah.

Diane Sanfilippo: I’m going to say, here’s some advice because instead of getting to a point where you forgot to start an emailing list 5 years ago, I’m going to tell you right now. This is a really important thing. You need to start an emailing list. This is really important. And then there are people out there who are like, build this, this, this, and this, and giving you all this stuff that’s going to get in the way of just running the business and doing the work and putting that time in because you’re trying to make it so perfect.

Erich Krauss: Yeah, sure.

Diane Sanfilippo: Because they’re trying to say, oh I wish I had done this, I wish I had done this in the beginning. But only 10 or 20% of those pieces of advice are the really important things that you need to do.

Erich Krauss: Yeah.

Diane Sanfilippo: And the rest of it’s just like, wait you’re saying you want to help me save time and avoid these problems, but really, the reason you got where you are is you had those problems and you overcame them. You know what I mean?

Erich Krauss: I think there’s two things in that line. A friend of mine told me, there’s always beta versions. If you try to make every product perfect, chances are you’re going to go bankrupt. There’s a point where you just have to release stuff, and put it out there, and just grind, and just not try to make everything perfect. But when it comes to who to seek advice from, I always look for, not just who has been the most successful, but who you respect morally. How they got there, because especially internet marketing, I know a lot of internet marketers, some of them are very legitimate in the way they do things, I really respect. Others, they’re hugely popular, but at what cost?

Diane Sanfilippo: Mm-hmm.

Erich Krauss: So I think that, for me, first and foremost is looking at where that person is, and also how they got there. Because you don’t want to sacrifice; you have to set up, I think, when you start a business a moral code for yourself of where you’ll go and where you won’t. As long as you live true to that, you’ll be happy. But along the way, you’re going to get a lot of advice from people that’s going to break that moral code. As long as you set it up in the beginning, you’ll know what advice to take and what to throw away. For example, we could be buying books to get them on the New York Times’ bestseller list, which I find not to be morally correct. So set up that code initially of how you’re going to deal with other people. A lot of times, it’s going to be a lot harder to remain to your own values.

Diane Sanfilippo: Yeah.

Erich Krauss: But I think that’s the most important thing with the business, because things can go bad really quick.

Diane Sanfilippo: Ok, that’s it for part 1 of my interview with Erich Krauss, president and owner of Victory Belt Publishing. Stay tuned for part 2 of my interview with Erich next.

Hey guys, I’m so glad you’re loving the show. Let me ask you to do me a favor; come follow me on Periscope. You can find me; I believe you can search Diane Sanfilippo, or you can search @BalancedBites, which is my Twitter handle, which is the account name over on Periscope. I am going to start doing live sessions really quick thoughts for the day. I’m not sure if it I will be every day, but it will be pretty often, and some Q&A on business topics and motivation, inspiration, etc. So make sure you’re following me over on Periscope. Download the app in the app store, and I will see you there.

That’s all I’ve got for you guys today. Don’t forget to subscribe in iTunes so you don’t miss an episode. And drop me a review to let me know what’s speaking to you from the show. If you want to get in on the conversation and you haven’t yet joined the group already on Facebook, head on over there and join the Build a Badass Business group. I share insights and tips regularly, as well as answer your questions right there on the page. Do work that you love, and hustle to make your business grow like your life depends on it, because it does. Thanks for listening, and I’ll catch you on the next episode.

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