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

Build a Badass Business Podcast | Diane Sanfilippo

Topics:Build a Badass Business Podcast | Diane Sanfilippo

  1. Business is not just business
  2. How to sell a book once it’s published [9:17]
  3. Publishing a book [12:38]
  4. Make decisions carefully [18:18]
  5. Starting slow is key [23:51]
  6. Finding your drive [29:51]
  7. Partnerships in business [36:31]

As long as you stay true to your moral code, work hard, the money will come, but you can’t do it for the money.

Anyone getting into business has to be willing to suffer greatly, but that suffering is going to make them a better person

It’s very easy, with one decision,To take your whole company in a direction you never saw it going, and it can be made with one decision. So be very careful how you run things.

If the drive is not there for the daily grind, you’re not going to make it in that business.

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Build a Badass Business: Episode # 26B: [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: Alright guys, welcome back to the show. This is part 2 of my interview with Erich Krauss, president and owner of Victory Belt Publishing, and my publisher. We went super long on our interview, and I wanted to break it up into two parts. Here’s the rest of it; I did not want you guys to miss some of this conversation. Because even though we kind of circled back and touched on similar topics, I just think it’s fantastic to hear different people’s perspectives. My favorite thing that he talked about was really the idea of holding onto your morals and your good judgment as a business owner. I think that’s something that we each have our own intuition about the way we want to do things, and I think that’s probably one of the biggest lessons that Erich has to teach. Enjoy.

Diane Sanfilippo: One thing that a lot of people don’t think about, but I think is something that, I don’t know if I would say it’s a lesson learned from some of my friends, but more like I’ve seen my friends do this. So Bill and Hayley who are just…

Erich Krauss: Wonderful.

Diane Sanfilippo: Just amazing people.

Erich Krauss: Wonderful people.

Diane Sanfilippo: And through the last however many years; I worked with them on Practical Paleo for the recipe photos, and they’ve always come from this place of, we’re going to help our friends.

Erich Krauss: Yeah.

Diane Sanfilippo: And even if in the process, even when we’re talking about it, a new project or whatever we’re working on, we’re talking about financial problems that we might run into with trying to do new projects or whatever, and at the core of it, it’s always about the people that you're in this relationship with as a business because it’s not just about business.

Erich Krauss: No, it’s not!

Diane Sanfilippo: That’s the messed up part.

Erich Krauss: Yeah.

Diane Sanfilippo: People want to come in and come and go and do whatever they’re going to do and say, well it’s just business. But really it’s not, because behind a business are the people who run it. And this is like being in a family.

Erich Krauss: Sure. If you take the Ayn Rand approach where it’s just business is cutthroat, and if a book is not selling you cancel it, bail on the authors. You do that, then it affects your business. Your business becomes that, and people see it, people talk, people look at your business, and eventually your business will suffer. You might intentionally draw people that have that same kind of cutthroat business mentality to your business.

Diane Sanfilippo: Yeah.

Erich Krauss: So, by taking the human element, setting up a moral code; you know, obviously there’s a point where the profit doesn’t make sense and you have to make a decision but doing it on a human level, but not purposely screwing over people that you’re in business with to make more money. If you set that up, I believe ahead of time in your own brain, you’ll be a successful business, and you’re willing to work hard.

Diane Sanfilippo: I think, too, my gut instinct when working with your company has always been, after Practical Paleo came out and all these other publishers came out of the woodwork. I mean, they were clawing at the 21-Day Sugar Detox.

Erich Krauss: Sure.

Diane Sanfilippo: Everyone wants to publish it, and I’m like, it’s not about business at that point for me. I was just kind of like, well I’m comfortable with this situation, I like these people, I feel like this is a family that I’m being treated well, it’s a part of this whole thing. I think I’ve always had the feeling where karma is going to do its thing for everyone.

Erich Krauss: {laughs} Yeah.

Diane Sanfilippo: No, really.

Erich Krauss: Sure.

Diane Sanfilippo: And I was like, you know, if I’m, not that I ever thought this, but in my heart and in my gut, I was like look if I’m not getting the best deal I could get and maybe it could have been better somewhere else and someone is cheating me out of something, again, not that I ever thought that, but if that were to happen, I always have it in my gut that everybody’s going to get theirs, and that’s not what it’s about. I’m going to go with what feels right, and where I feel like people are treating me with respect. I want the experience of working on the project to be good.

Same thing with any customer situation. So people listening, they’re coaches, they’re trainers, they’re nutritionist, they’re people who have either paleo oriented or not companies; maybe they’re bloggers, and I think it can get really alluring, especially in the beginning when you’re not earning that much money, to be really dazzled by money. And I think in the long run, most people end up getting kind of bit in the butt about that. If you really just go for it. Say someone wants to sponsor an ad on your website, and they’re like, oh we’ll pay you all this money! Well then, what if something happens, you don’t uphold that and you’re totally screwed. Or you just built this relationship based on that, versus… You know what I mean?

Erich Krauss: Yeah, I honestly, I think the best approach is to not even think about money in the beginning. I never did. I used to live on $4,000 a year living in third world countries, you know what I mean? So it was never about the money, to me. And I knew, if I just didn’t focus on the money, and I focused on the product and the work, and you take nothing out of the company and you just work like a mule, it all comes around. You know? Treat people fairly, don’t take money out of your company early. Put it all back into the company, build your company, don’t take deals that you know are shady or not going to pan out alright just because it’s a dollar. As long as you stay true to your moral code, work hard, the money will come, but you can’t do it for the money.

Diane Sanfilippo: That’s a lesson, I think that’s a lesson too, that if you go into whatever it is that you’re trying to build that way, then if something “fails” the journey you were on to learn was totally worth it. People are like, oh, what do you regret, or what’s the biggest failure, whatnot. I’m like, well I don’t really see anything that way because I never sold out in the process, and I never was like, oh I gave up my pride for this, so that was a mistake.

Erich Krauss: Yeah.

Diane Sanfilippo: It was like, no, I learned the whole time I was doing XYZ, so I think that’s something.

Erich Krauss: Sure. Everything’s an adventure. Truthfully, if you look at any journey to a pot of gold, what you remember is not actually when you reach that pot of gold, it’s actually the journey itself, right? So when I look back on fighting in Thailand, I don’t remember winning a fight, I remember the 6 months of 2 a day training sessions that were literally beating me up. When I look back at my company, now we’re hugely successful, have a great staff. I don’t look at what things are happening now. I look back to where I was passing out at my computer.

Diane Sanfilippo: {laughs}

Erich Krauss: Those are the stories you tell. Generally you can tell the most exciting moments of your life with the stories, and stories are always the hardest moments you’ve had in your life. So while you’re suffering in that moment, it’s a story in the future, and something you’re going to look back on and be proud of. So I definitely think anyone getting into business has to be willing to suffer greatly, but that suffering is going to make them a better person, it’s going to be stories to tell, it’s going to be a memory versus if it’s something you make it right off the bat. If the first book I ever published had been a New York Times’ bestseller.

Diane Sanfilippo: {laughs}

Erich Krauss: The whole path, the 10-year path, you know, I would have been lacking that, and I would have been sad about that.

Diane Sanfilippo: You know, what’s funny. I don’t think there are any successful and inspirational entrepreneurs who haven’t had a struggle or who haven’t been grinding it out for a period of time, or just hustling and crushing it and all that stuff. So even though my first book…

Erich Krauss: Was a New York Times’ bestseller.

Diane Sanfilippo: Did become a New York Times’ bestseller {laughs}

Erich Krauss: Yeah. Your path was creating the content over the years, struggling as a nutritionist, trying to get word out there about what you’re doing. That’s the path.

Diane Sanfilippo: Well and really just the hustle in the meantime. It’s not like I came out of school, wrote a book, and poof, it’s a New York Times’ bestseller.

Erich Krauss: Yeah.

Diane Sanfilippo: It’s like, years of traveling to teach and figuring out, and having a podcast.

Erich Krauss: Building a platform, yeah.

Diane Sanfilippo: And doing everything that lead up to it. I think kind of one of my missions with the interviews on this show, and the show in general is to not have people disillusioned and have them very clear on how much work it takes to be successful. And also how much work it’s going to take to have success that feels good, because you can have financial success, but you’re like, what did I really do to earn this. Where as you can work really hard, build something, and, you know what I mean?

Erich Krauss: Yeah. If you look back at me, I spent 10 years writing, learning how to write, in a basement, to try to get a book. Your thing was doing seminars. It’s different now; bloggers don’t spend 10 years writing. Your path is to go out there and do seminars, get out there on the internet, network, market. A lot of people now, you get contacted as a publisher constantly about, oh I have this idea of starting a blog and I want to do a book to promote it. It doesn’t work like that, no one’s going to buy the book unless you already kind of have a platform, or you’re a great writer and spent 10 years learning how to write. So you’ve got to have that lead in to it.

Obviously, there’s a sweet point where you don’t want to wait too long, and you don’t want to go too early. As a publisher, that’s our job to kind of gauge that sweet point.

2. How to sell a book once it’s published [9:17]

Diane Sanfilippo: So what about people who are listening who are maybe bloggers who, obviously they’ve seen what I’m doing, what a lot of other paleo bloggers and authors are doing, and some of these folks might be nutritionists, or they’re maybe they’re in the fitness arena. What advice would you have to them on getting to a point where, it’s the right time to write a book? And then also on what you’ve seen really does it to help sell a book?

Erich Krauss: Sure. Well, I think to tackle the second part first. When a lot of authors, when their books come out, they’re like, oh want Good Morning America, I want the Today Show, I want NPR. These big platforms; truthfully, we’ve got authors on all those platforms, and what sells books 10 times more is the grassroots. So what happens is, not that you’re not trying to go for the mainstream. But in order to get there, you tackle the grassroots market; get it so popular in that market that it bubbles over into the mainstream; exactly what happened with Practical Paleo. All of a sudden now it’s big in the mainstream, now you have a New York Times’ bestseller, and it creates this cycle where people are talking about your book, it becomes the got-to book when they come to a certain niche or learn about something.

So definitely try your first week of your first book to get on Good Morning America; while that might be great, because it’s good for your resume, and it is good for book sales; certain book sales. It depends on the book, and the type of the show that they’re angling after. But really focus on that grassroots and get it built up on that level. And when it gets big enough on any grassroots platform, as long as that grassroots platform is big enough, it will bubble over in the mainstream.

Diane Sanfilippo: I think what people don’t realize about that stuff is that typically, the catalyst for that is not just you have a book, it’s spending money on a PR firm.

Erich Krauss: Sure.

Diane Sanfilippo: If I wanted to do a press circuit; and I don’t have any problem with that. People choose to do different things, spend their money differently, spend their time differently. It hasn’t been a priority for me to do a television press circuit; it may be something I look at in the future. But I just kind of was like, mmm, I’m not sure that’s for me. But I think a lot of people don’t realize that it’s not just because your book is popular, you get on this show. Because if that were the case, I would have done a tour of television for 2 years.

Erich Krauss: Yeah, all the morning shows. Yeah.

Diane Sanfilippo: I mean I’m just kind of throwing it out there; to have a book that’s the 6th bestselling cookbook, there’s no reason why I wouldn’t have been on those shows if that were how it works.

Erich Krauss: Sure.

Diane Sanfilippo: That’s not how it works. So I don’t want people to be disillusioned.

Erich Krauss: No.

Diane Sanfilippo: Like, oh, well…

Erich Krauss: if you have a New York Times’ bestseller…

Diane Sanfilippo: If I don’t get on TV; it’s not that. You have to hire a PR firm, and then you can work on it.

Erich Krauss: I have similar bestselling books; they were never on TV.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: But it’s still in the mainstream. I think there’s two ways; the shows have a topic that’s really hot, and this book fits that topic and it is also a really popular book, you can get on the morning shows that way.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: But more often than not, it’s like your PR firm pays, and you get on certain shows. So there’s all that that goes on if you want a guarantee. And even then there’s no guarantee. I’ve talked to PR firms where you pay X number of dollars every month, which is insanity, and they haven’t done half as good as our publicist with Victory Belt for whatever reason.

Diane Sanfilippo: You never know.

Erich Krauss: So there’s really no guarantees. Obviously, some PR firms can do really good stuff.

3. Publishing a book [12:38]

Diane Sanfilippo: Yeah. So then, advice to people who are starting out and are thinking, one day I want to publish a book. Because I’ve had a lot of people asking me, oh do you publish, do you self publish, do you get a publisher? What would you say to people, if they’re looking to eventually have a publisher? What’s what they really need to be doing now, and also are there people that you would say, you know, you’re probably better off self publishing? Are there people that they’re not ready to have a publisher or, what would your advice be there?

Erich Krauss: Yeah, you know the self publishing thing it really depends. Distribution is king. So if you’re just distributing in one area, you can get sales, you can market, you can make more money per book, but really if you look at the numbers from, let’s say Practical Paleo.

Diane Sanfilippo: I can attest to that.

Erich Krauss: Being published just online; if you would have seen the numbers today compared to the numbers that you have sold with that book, it doesn’t even pale in comparison. And the money they would have made self publishing is a fraction.

Diane Sanfilippo: So the big difference with self publishing a printed book, and I recognized this from the very beginning, because I was like, the point of having a publisher is partially an upfront investment in the work and the printing of the book. But really the benefit, unless you’re willing to do this work, it’s having people distribute and sell this book into chains.

Erich Krauss: But not all publishers are created equal.

Diane Sanfilippo: Right.

Erich Krauss: So if you look at a lot of publishers, they don’t distribute to a lot of places. So definitely, if it’s self publishing or publishing that distributes to 2 places; definitely go the self publishing route. You’ll make more money. Chances are, if they don’t distribute, they don’t do a good job editing, they don’t do a good job designing.

Diane Sanfilippo: But some books that are self published, they’re on Amazon for a long period of time.

Erich Krauss: Sure.

Diane Sanfilippo: And that’s great, it’s a big market. But people forget that getting your book into even Barnes and Noble, it’s how many hundreds of stores? And they think that it’s not a big deal, but it is. On a scale basis.

Erich Krauss: Yeah. If you look at combined Barnes and Noble, let’s say Target, Costco, Books A Million, BJs, Whole Foods; you add up, and then there’s overseas markets, there’s Canada, there’s UK, there’s Australia. It’s ridiculous. If you look at the figure of the more distribution; you could take a book that doesn’t sell that well, but you put it everywhere, it’s going to sell thousands of copies just because it’s everywhere.

But there was a time years ago where self publishing could be good. But if you look at the platforms that have self published stuff; literally, there’s mountains of garbage. I know internet marketing firms that put out books on every subject, one a week, just to try to get 10 sales. And they hire writers at $300; so you’re competing with all these people.

Now, what I’ve seen when they go online to buy something, they’re looking that something is credible, that it has a backing behind it, like a publisher. It’s got a print version, not just an eBook. Because if you download some of those eBooks out there, some are really good, some are atrocious.

Diane Sanfilippo: And a lot of those atrocious ones are stolen content.

Erich Krauss: I know!

Diane Sanfilippo: We’re battling all the time copyright and trademark.

Erich Krauss: The self publishing niche isn’t what it was when it first came out, and I don’t know if they’re going to find a way to solve that. And then it gets into content; you have to look at the content, is this credible, is this just a hack thing.

Diane Sanfilippo: And self publishing in a printed book distribution is really going to be the, it’s going to be the downside.

Erich Krauss: You’re going to be shipping out of your garage.

Diane Sanfilippo: Yeah, you’re sitting with cases of your own book, and quite frankly as somebody who in the past where I had a business where I owned inventory, the last thing I want to do is have to sell tens of thousands of copies before I make a profit on something that I just worked my butt off for years on. I think that it’s more worth it to do the work in building a following, do the work in whatever it is with your blog and your arena to get to the place where a publisher is willing to work with you.

Erich Krauss: And what people have to realize too, even New York Houses, they’ll take a book and they’ll look at it and say, I don’t know if I want to print 20,000 copies of this, so let’s not distribute it to these 19 sources, and let’s just distribute it here. So even when you get a publisher, you have to be very careful because there’s a chance they don’t want to take a risk.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: My philosophy is, don’t bring on a book unless you’re willing to take on the risk. And I’ve suffered before with projects, but unless we’re willing to go whole hog on distribution, I won’t even bring a title on, because it’s not fair to the author, and why would I do that? You know, it just doesn’t make sense.

Diane Sanfilippo: Yeah, it kind of says up front that you don’t believe in what they’re doing.

Erich Krauss: Exactly. And I’ve seen a friend of mine publish a book through a major publishing house, got a good advance, and I heard their first print run, and I was like, that was a fraction of what we would do. A fraction, and it was a celebrity they actually did the book with. So it’s funny what goes on; I’ve never been involved with traditional publishing world, so I don’t know how they make those decisions, and I think it is in a board room and it’s all done with finance. Oh, we’re a little short this month, let’s cut these books. And that’s where you take a risk, I think, going with…even if they have a big investment on an advance. It’s crazy!

Diane Sanfilippo: Yeah.

Erich Krauss: I don’t understand their thinking. But I guess that’s what happens when you publish 4,000 books a year.

Diane Sanfilippo: How many books a year are you guys publishing, roughly?

Erich Krauss: Last year was our biggest year, I think it was 32, and this year 20. So we’re definitely…

Diane Sanfilippo: Scaling back to just…

Erich Krauss: Just a little bit, just to yeah. I mean, as we’re branching out in a couple of new genres that really interest me, so we’ll probably get back up to that 30 number as those books start coming in.

4. Make decisions carefully [18:18]

Diane Sanfilippo: Awesome. Anything else you want to tell people about running a business?

Erich Krauss: I might not have the 4-hour work week model.

Diane Sanfilippo: I certainly don’t.

Erich Krauss: No, and I don’t know anyone that has a 4-hour work week model that’s made a living honestly. That means not sacrificing your morals. And if your morals are different than mine, that’s fine. But scamming old ladies out of money to sell product that won’t benefit, to me I’d rather not make the money. And I’ve never seen anyone that hasn’t worked just ridiculous. Even the people that sell products about working less, they work so hard to make that product to teach people how to work less.

Diane Sanfilippo: Yeah.

Erich Krauss: Yeah, I think it’s basically a grind. Stick to what you know. But in that regard, be willing to bend your direction to find a market for it. It goes back to the fiction.

Diane Sanfilippo: That was your pivotal moment, was being willing to saying yes to writing something that was nonfiction.

Erich Krauss: That wasn’t in my, yeah. But you have to be able to bring it back around. Because my goal was to write fiction, so I was to do a couple of books, my agent said in nonfiction to get that platform; 30 books later, 33 books later, I opened a publishing house, and I still haven’t gone back to the fiction.

Diane Sanfilippo: It’s out there!

Erich Krauss: Yeah, it’s coming. It’s coming in the next couple of years. But what I’m saying is, sometimes those deviations will lead you in a direction you never saw as long as you’re willing to take a path that will take you in the same realm of what you want to do, but in a slightly different direction.

Diane Sanfilippo: And then just kind of the last thought I have here. I think you’re at a place where, you’re still working hard, but you definitely, thanks to your amazing wife, are finally also balancing that out with a lot more. I wouldn’t call it; well, it’s downtime but it’s really taking care to balance your life a little bit more. But this is after a period of time that for you felt like the right amount of time to be doing that hard work, almost exclusively, right? And I keep telling people, I was the same way.

Erich Krauss: You can attest to this, though. There’s a time. If you’re doing the hard work yourself, if you try to build a company overnight, you’re going to get terrible employees. But as you’re working hard yourself, you bring in someone that you find special, like with me, Michelle. Bring in editors that are exceptional, and you build it slowly with people that you’ve already worked with that you trust, and now I’m at a point that I have such an amazing crew because I didn’t try to construct it overnight. I built it slowly over time that literally I could walk away, and do my fiction, and the company would run flawlessly by itself. But because I’m who I am, I’m still directly involved.

Diane Sanfilippo: Yeah, well, and you love it.

Erich Krauss: In every aspect of the business.

Diane Sanfilippo: It’s part of what you want to do. Yeah.

Erich Krauss: But I think that’s the key, to build your company slowly, do everything yourself at first so you can remain profitable. Don’t take big paychecks out of your company when you sell something, put it all back into your company, keep reinvesting. Sometimes it’s 5, my case 10 years, before you take a penny, just enough to survive on. Don’t take extravagant vacations, and slowly bring on people that you work with over time that you really trust. And I think that’s a good model for a long term business. But more importantly, develop a moral code in the beginning. Because in this day and age, you will get presented with so many money making opportunities as you develop an email list, as you develop these things you talk about, to turn that shady and to sacrifice. It’s very easy, with one decision, to sacrifice a company.

Diane Sanfilippo: Yeah.

Erich Krauss: To take your whole company in a direction you never saw it going, and it can be made with one decision. So be very careful how you run things. Is that good advice?

Diane Sanfilippo: I think that’s really good advice. I’ve been offered a lot of things.

Erich Krauss: Oh, you I could only imagine!

Diane Sanfilippo: People want to have me promote so many things that I’m like, I have friends, I have legitimate close friends that I take my time before I promote the thing before they sell. I tell people, I’m not going to promote something to these tens of thousands or hundreds of thousands of people who are listening to me until I feel…

Erich Krauss: Even though you could get a big paycheck for it.

Diane Sanfilippo: And I get to the point; exactly. I mean literally, people are coming at me with things to sell, that I’m like, I know this is how 80% of people in nutrition make money. It’s on these three things that are being sold. It’s just not who I am.

Erich Krauss: But you’re going to survive long-term because the people that follow you can trust you. The minute you break trust with somebody, and even with books. Practical Paleo is this huge book, and we’re talking about oh, Practical Paleo 2, doing a different. No. I want to focus on until I feel;

Diane Sanfilippo: {laughs} Don’t get any ideas, people, you did not anything. This is not happening.

Erich Krauss: Well what I’m saying is until you feel right about a project, and until you know you can offer content that is going to benefit you, you don’t do it. And I think that’s a decision a lot of people really have that hits big, and they try to capitalize and they put out products that are subpar.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: And they shoot themselves in the foot for the long-term, even internet marketers, everything. If you can’t trust who you’re following or doing business with, because they made one shady decision, you’re hurting yourself for long-term business.

5. Starting slow is key [23:51]

Diane Sanfilippo: What you’re talking about is smart. I think the smart part is following your gut, not taking stupid offers just for the money, keeping your morals and your values, holding onto those. I think those are the really smart things, and I don’t think working really hard is not smart. I think that’s really smart. I’m with you on the keep your company small, do all the work yourself until you really can’t and until you actually have the money to spend. I generally tell people to hire someone just before they thing they’re ready to afford it. I do think you’re almost never going to be totally comfortable to hire that first person, so you kind of have to do it when you’re like, ok I feel like if I don’t do this I can’t do everything anymore. Some people feel they can’t afford it yet, but that’s kind of the time to do it, right, you’re just at that breaking point.

Erich Krauss: Yeah.

Diane Sanfilippo: I’m sure when you hired Michelle, you were like, I don’t know if I should, but I kind of feel like I have to.

Erich Krauss: No, at that point I knew, because I had worked with her enough.

Diane Sanfilippo: Ok, so that’s a little different.

Erich Krauss: Yeah, I had a track record with her. And I knew she was sharp.

Diane Sanfilippo: I’m talking about people who are trying to hire an assistant, the first assistant. Basically how to do that before you're ready. But I don’t think if you’re just starting a business, I don’t think you get to delegate 10-20 tasks a day until you’re like, ok I can’t handle all of this.

Erich Krauss: And what happens a lot is you feel overwhelmed in your business, like you’re working 10 jobs basically in that business, and you think, oh I’ll get another person to help out. And what you realize real quick is that your business is so personalized to you that it requires more work to 1, describe that task to that person, and to double check. And I’m not saying this is a learning curve; some people will never be able to do what you do with your company. For multiple reasons.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: One, you're passionate about it. Two, you're going to benefit because it’s your baby. They’re coming into your baby and helping you craft it, and that’s never motivating to somebody. So sure, there are jobs, you just have to realize that you’re always going to have to do no matter how tedious they are. The only option is, if you get too big, is to do what I’ve seen other publishers do, sacrifice their product isn’t as good, and they just know it’s not going to be as good because they don’t have the quality control, because not everyone in a 500-person company is going to care about that final product.

Diane Sanfilippo: Yeah. There’s always that one group of things that you don’t relinquish control on. And I think this is, you know, for those of us who create content and write things or make recipes or whatever, the core of that, that’s who we are and what we do, and that’s what we create and put out into the world. And if there are other things that we don’t need to do. I don’t answer my emails that come into the website, I don’t answer customer service issues. I don’t field questions from a million different places; they all get filtered through an assistant. I don’t edit my own podcasts; there are all these things I don’t do. But my voice on the show, that’s me. I can’t not do that.

Erich Krauss: But put it this way; if you were to do another cookbook, right, and you hired a professional photographer to do the photos, I guarantee when you looked through the photos, you’d go, that’s not right. Because you have an idea for your product finished in your mind.

Diane Sanfilippo: Well even working on the 21-Day Sugar Detox cookbook, which I publicly, I mean it’s in the book, a thank you, worked 50/50 with another photographer to help get that book done faster because I was just tapped out. I mean, I really wanted to put out another cookbook, and I was like, you know what I want someone else’s input on recipes and that was a hard thing to relinquish that control, and I felt pretty good about it because I did work very closely with her on everything. But that’s hard. I don’t want that thing to get out there and it’s not really my work.

Erich Krauss: Yeah, you don’t feel like that’s where you eventually have to make a sacrifice with your company. Because if you’re that passionate about it; if you’re not passionate about it, it doesn’t matter. But if you’re that passionate about it, you think everything should look the way you envision it in your mind. So at some point as you get bigger, you have to relinquish a little bit of that, because involving other people, they’re going to bring their vision.

Diane Sanfilippo: But for some people, you know, there are parts of it that they truly feel it’s ok to have someone else help with, and everyone has to make that decision. And so I’m not saying you don’t delegate, or you don’t hire people, but I think the point we’re making is, in the beginning, don’t get ahead of yourself thinking I need to hire 5 people, or I shouldn’t have to do XYZ. I think everyone should be, even if it’s hard for you. I don’t know; maybe I’m lucky because I was a designer in doing a lot of the techy web stuff, for me it’s easy to say because I could figure that out. But there’s so much of that that I didn’t know what I was doing; I literally just sat and figured it out for hours, and hours.

Erich Krauss: I know, me too. I think a lot of people have this idea of whish and it will come. So they have this picture of their business, and it’s this thriving, hustling business with 10 or 15 employees, and they think, well if I just get those employees and start this it will all kind of come together. But usually it doesn’t happen like that. You just do it all yourself until you can bring on one person, and you slowly build it. And I think that’s the only way. Even if you’re profitable right out of the gate; don’t grow too fast. That’s the biggest problem. Because times might not be good forever, and then you have a giant staff to pay, so until you have a steady track record over time, bring in people you really trust, people where their vision somewhat matches your vision so that you can relinquish some of that control. And that’s what I did over 12 years, building a staff of wonderful editors, designers, operation manager. I mean, building it slowly has been key and is what allowed us to remain very profitable and have really good products still get turned out. So, that’s just what I’ve done. Of course, I’m sure other people take different routes that are just as successful.

6. Finding your drive [29:51]

Erich Krauss: I think the single most important factor to have to be successful at anything in life is not extreme intelligence, it’s, just drive.

Diane Sanfilippo: It’s not even skill, because you can gain skill.

Erich Krauss: It’s not even skill! Anything.

Diane Sanfilippo: How to people get that? I don’t know how people get it.

Erich Krauss: I don’t know. I mean, I just.

Diane Sanfilippo: I don’t know how people don’t have it.

Erich Krauss: I got it from my dad. My dad is German, who has this insane drive.

Diane Sanfilippo: Oh, obviously that’s why we’re like so similar. I’m half German.

Erich Krauss: Yeah. {laughs} But you know some of the most intelligent people I’ve ever met, have never achieved.

Diane Sanfilippo: I’m not the smartest person.

Erich Krauss: Me either.

Diane Sanfilippo: I was not a straight A student.

Erich Krauss: Yeah.

Diane Sanfilippo: I was like school, what?

Erich Krauss: Yeah, but if you have drive you can achieve anything. So I think realistically assess your own drive. If you’re willing to go out, if someone said, let’s say you want to publish a book, go stand outside in the rain for 13 hours and I’ll give you a book deal, would you do it? You know? I would have done that in a heartbeat. I would have sat out there for 6 days. It would have been a challenge to me, it would have been intriguing. So realistically assess your drive. If you don’t feel you have the drive in whatever business that you’re willing to work 20 hours a day to be successful. If you’re just going into that business because you think there could be great profit in it, versus being passionate about it, I would say reassess. Because you need that drive. If the drive is not there for the daily grind, you’re not going to make it in that business.

Diane Sanfilippo: That’s good advice.

Erich Krauss: So find something that does ignite that drive within you.

Diane Sanfilippo: Gary Vaynerchuk talks about this a lot, he says to audit yourself, and find out if you are really that kind of person about this business or not. And I think, you know, of course, we’re entrepreneurs and we have that, and we have a ton of respect for other people who do have that too, but I think that obviously you have a team that you value immensely and have a ton of respect for; and the same thing with my team. People won’t all have the drive to that same level.

Erich Krauss: Sure.

Diane Sanfilippo: And I don’t think it’s a bad thing; we would be no where without the people who are also on our team who are also like, you know what, I don’t know that I want to work 20 hours a day doing this, but I could work really hard to work for this small company that I really believe in what they’re doing and again coming back to the people. People are not going to join your team and work hard for you unless they believe in you and you’re a good person and you treat them well and whatever. That kind of all cascades down. I think if you’re someone who is feeling like you want to be an entrepreneur, but you’re like, I just feel like I don’t have that extra notch, like I can’t turn up to level 10.

Erich Krauss: Level 10, yeah.

Diane Sanfilippo: That’s creepy. Level 10, like if you’re like, I could go to a 7 or an 8 but I’m not sure I could go to 10, then you’re a perfect person to be a right hand.

Erich Krauss: Sure.

Diane Sanfilippo: An operations managers, a project manager, whatever. Somebody who is going to be in that critical support role to someone crazy like us, but we can’t function without those people. And I want people to know if you come through this and you’re thinking you want to be an entrepreneur, you're thinking all this but you get to the point where you’re like, you know what, either I don’t have that element or I have a family and that’s always going to be more important to me.

Erich Krauss: That’s the truth, that’s one thing I hear from people out, when they start their business. Oh, but we’re going away for this weekend so I can’t do it because I’m going to go spend time with my family. Literally, you can’t do that when you start a business, in my opinion. I didn’t have a family when I started, and I was working 7 days a week.

Diane Sanfilippo: Or wife, yeah.

Erich Krauss: And my dad had the same philosophy, sacrificed some of his family in the early years. So I honestly think if you’re wanting to start a business and grind away, especially if you don’t have a big investor, which I think is a terrible idea to get in the first place, but you’re going to sacrifice family. You’re going to sacrifice all the little things you like to do throughout a day. Your diet, you know, you’re going to sacrifice your health; stress levels. So if it’s not worth it, then you might not want to get involved.

Diane Sanfilippo: And that’s ok.

Erich Krauss: That’s ok! Yeah.

Diane Sanfilippo: Especially if we’ve got people listening who, if you have an autoimmune condition and you're like, my health needs to be on track. Don’t grind yourself into the ground. There’s no shame in not doing that. I don’t think there’s any; it’s not glory for the sake of it. If you’ve crushed yourself beyond repair, I think both of us have crushed ourselves but also don’t have those preexisting conditions that have made it beyond repair where now we’re like flattened so easily or whatever. I think there’s a difference there. We both almost died working on Practical Paleo. I went and got blood work done because I was like, I think I’m dying.

Erich Krauss: Yeah.

Diane Sanfilippo: Something’s wrong; they’re like, nothing’s wrong with you, I think it’s just stress.

Erich Krauss: Yeah, I developed a strange tremor in my hand.

Diane Sanfilippo: {laughs} Eye twitches.

Erich Krauss: I think the best judge of whether or not you should start a business I think is, are you a goal oriented person? Have you ever done things in your life, like a body building show, where you have to diet insanely, workout for 6 hours a day, get to 2% body fat for 6 months, this prolonged goal setting where you give your entire life to that one goal. I did that routinely, whether I was training for fighting or body building or whatever it was; I’ve always been a goal oriented person. The difference is, with a business, is I handled it with the mindset of, oh it’s just a goal like any other thing. Like I went to Thailand to learn to fight in 3 months and was fighting professional in the ring, which is scary, but it was a 3-month process and it was done. And when I first got into business, I kind of had that same philosophy, like I’ll get into it, work hard, and I’ll achieve it. But what you don’t realize in business is there’s no end.

Diane Sanfilippo: Mm-hmm.

Erich Krauss: So goal oriented people can get in trouble in business in that you just, you’re so used to achieving a goal. But you have to set some sort of goal, because it’s never ending and I planned for 10 years!

Diane Sanfilippo: Oh, how many times were you like, oh Diane, congratulations XYZ, and I’m like, Ok. And I don’t even celebrate because it’s not about that.

Erich Krauss: Yeah. So in business, I think if you are a goal oriented person, you can get in trouble and sacrifice your life for that business, so the best suggestion I have is set a goal. Once I achieve this, I’ll know I’ve made it, I can start taking it easier. Or I can start hiring someone. But not until I reach X number. For me as a writer, it was to hit the New York Times’ list, so when I hit it, I literally that day thought, I could die tomorrow and I’d be perfectly happy. But then I set another goal after it, which was to create a publishing house and be successful there.

So set, if you’re a goal oriented person, set limits to when you reach this level you can take it easy. Because you can grind yourself into the grave. If you’re not a goal oriented person, really second guess whether or not you want to start a business.

7. Partnerships in business [36:31]

Erich Krauss: And another big factor is partnership. I see a lot of people that want to get into business and they’re nervous about it, it’s a new thing. So they think; oh, I’ll team up with somebody, we’ll have a partnership, it will make it that much easier.

Diane Sanfilippo: No.

Erich Krauss: That is always the biggest disaster I’ve ever seen. I’ve never ever seen

Diane Sanfilippo: It’s too much responsibility diffusion that way.

Erich Krauss: Diffusion, yeah, because you can go, oh I’m stressed right now because so and so is not handling his or her part. When in reality, they’re thinking the exact same thing about you. Because business is stressful and it requires insane dedication from everybody. So you’ll always view the other person as working less. Because all you can see is you not sleeping, you stressing to the gills, and it leads to constant conflict. So my biggest thing is, I know it’s scary to start a business by yourself, but that’s the only way I would ever do it. If you need to work another job to get more money to do it, you have to. But my goal has always been to avoid partnership because it’s just going to end in turmoil. And usually what’s going to happen is, you’re both going to get frustrated and the business will dissolve. Whereas, if you had started it independently, you would have taken it somewhere.

Diane Sanfilippo: I think that’s good advice. I have never had business partners.

Erich Krauss: Yeah, I couldn’t imagine it. I’ve had partners in other things where it’s small term goals. Even, for example, when I used to bicycle across the United States. And I did the first one at 18 years old. You camp out in the woods, you bike 120 miles a day, it’s brutal for the Rocky Mountains, and I went with a buddy at 18. There was a mountain, a giant mountain, and we’re like, ok we’re going to climb that mountain. And it was like 3 hours after biking 8 hours; we just set crazy goals. So we climbed to where I thought the top of the mountain was and said, ok we reached it. He said, what are you talking about, the top of the mountain is up there. I said, no in mind I set this as the top of the mountain. We got into a huge fight. And this was over just climbing to the top of a mountain. Imagine if it comes to business goals and what you expect out of the other person. Yeah, I only see it as a nightmare waiting to happen, and it can collapse something that’s really good. Usually one person will buy out the other person, there will be resentment.

Diane Sanfilippo: Yeah. The only partnerships I think I’ve had, like in the podcast, with Liz and that was always my thing first. I was the one who wanted to do it, same thing with the seminars. But I also am, I don’t know, I have enough if the word is emotional intelligence, but to know that my expectation level, when I’m involved, my level of desire, dedication, drive, all of that, will always be higher than someone else’s. That’s not to say that they don’t care about it, they don’t commit to it, all of that. But I just know myself, and what I want to do is always going to be at a different level.

Erich Krauss: But that’s different.

Diane Sanfilippo: And I think it’s also like when you go into a partnership like that; because there are a lot of people listening who are like, ok, I want blog with someone. Or I want to do a podcast with someone, or whatever. You have to know that even in that situation, it’s never going to be a totally equal balance. You have to decide if you want to do it, you have 80% of the responsibility, they’re involved, and you have to not be too attached to the outcome of, here’s what’s going to happen. You know you can rely on that person, but also at the end of the day, ultimately if it’s your thing and you're taking the responsibility, because that’s what you want.

Erich Krauss: But I see it different for you. You built a company, and that’s your foundation, that was all you. You’re doing other projects that are based off your company, partnership to either sell product or help people in a certain way. So I definitely think you can go into those with tailored expectations. That falling apart wouldn’t affect your business. Right?

Diane Sanfilippo: Right. But what I want people to be careful of is not having it affect a friendship.

Erich Krauss: Sure.

Diane Sanfilippo: The way that I always kind of structure things emotionally is I am thrilled to have you doing this with me, someone that I love as a friend, and want to make sure that we talk about expectations up front and all that stuff. And if the day comes where it’s like, hey, I can’t do this anymore because I have these priorities, whatever, it’s not personal, I don’t care about you or this thing but here’s what I have to go do. And that’s ok, because it’s not really a financial set up either.

Erich Krauss: I think another aspect in that same vein is, let’s say you're waiting on something from a partner, and let’s say you have your own core business, and you have a sideline thing with somebody else. If they aren’t giving you the information you need, you still have someone to fall back on. You can work all day on your business stuff, and still be able to move forward. If you’re only business is a partnership, let’s say you’re waiting on 50 words so you can finish writing a manuscript, and the person doesn’t get it to you for a week. Anyway, you’re sitting there, hating him, stewing, going, when am I going to get these darn 50 words?

But if it’s a sideline project, you can go back, focus on your core business, and wait for those words to come in and it’s not holding you up. So I think it is fine to create sideline partnerships for little things, but as long as you have your baby and your core direction in your company that you can always fall back and do what’s all you, the rewards are better, and you’ll never be disappointed, and you’ll never be pulling out your hair waiting for that copy or that one thing.

Diane Sanfilippo: I almost think it’s a myth, too, that people can be totally equal partners. I really do think that there’s always someone that just has that at least 1% more drive or control or whatever it is. So I think it’s really smart to know what your role is in that. Are you the driver, or are you the copilot? And own that, and don’t try and take over if you’re the copilot, and don’t try to relinquish that control if you’re the driver. You have to really be driving it.

Erich Krauss: Yeah, and I think if you both have the same skill sets, why are you going into business together? Let’s say, one guy’s a dancer and the other guy is a booking agent. That can work out because as long as the booking agent is keeping up his side, and the dancer is not missing events, that can work out. But if you both have the same skill set and you both do the same thing, why are you going into business together? It doesn’t make sense. Keep that friendship intact, do your thing.

Occasionally you can bring in someone into your business as a partnership; but then you have to be careful because it’s relying everything upon that other person. So I personally would not get involved in a business that relies so heavily on someone else. Because in all my experience, no one has ever kept up with me, because I have insane drive. I’m not very over-intelligent, but that drive is what I think can really run companies and make them successful.

Diane Sanfilippo: 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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