One thing that helps you grow a business is the idea of forming a partnership. In this episode, we're talking with Darrell Vesterfelt about the power and pain of partnerships.
If you're working on your own, a Lone Ranger, a solo show, there's only so much you can become an expert in, right? You may be really good at building in SEO, but that doesn't mean you're good at coding websites. Your limitations cap what you can do and how far you can go in your business.
The obvious thing you can do to solve this problem is to pay someone to help you, which may not fit into your budget. But there is something else you can do: You can find a partner. Partnerships bring another pro onto your team to focus on what they do best, so you can focus on what YOU do best. And you both have ownership of the venture.
Darrell gives us the low-down on all things partnerships—the ins and outs, highs and lows. He has been very strategic, very purposeful, with connecting with others and formalizing partnerships with others to achieve a bigger goal together.
In addition to this, he's started helping people rethink how to do content marketing and building content on the web for a modern world.
Darrell is the co-founder of an agency called Good People Digital. GPD focuses on developing websites for brands like Smart Passive Income, Nathan Barry, and others. Darrell is also the vice-president and managing partner of Copyblogger, a website focused on education for content marketers.
- Why sole entrepreneurs might consider forming a partnership
- The first steps toward bringing a partner on board
- What needs to happen legally to be in a partnership
- What the must-haves are in a partnership agreement
- How conflicts might be resolved and disagreements handled
- Rethinking content creation and building content on the web
- How to create more value from your website
- Netflix consumption style vs. broadcast television-style
- How to avoid blog-writing burnout
- How to create really focused times in your business
Note: some of the resources below may be affiliate links, meaning I get paid a commission (at no extra cost to you) if you use that link to make a purchase.
SPI 412: The Power (and Pain) of Partnerships & The Future of Content on the Web with Darrell Vesterfelt
Pat Flynn: Let's say for example, you are starting a brand new business from scratch, even if you have one already. And you have this amazing idea, yet you don't have the skills or the talent required to actually create the thing. Let's say it's a piece of software for example, but you don't know how to code or you have this amazing idea, but you just don't have any access to that market or know how to market it.
Pat: Well, what could you do? You could potentially hire somebody, right? You could go the long route of learning as you go, and blogging about it, and documenting it, and figuring it out as you go. Or you could develop a partnership, a partnership defined as finding somebody or another group of people to supplement the parts of the business that you do not have the talent to do in exchange for either profit or a share of the company. And partnerships have been the answer and the way many different businesses have started. Yet I also know partnerships are the answer to this question very often: What is giving me the most pain in my life? And it's one of those double edged swords, right?
Pat: So today I'm really excited because we're going to go deep into the history of Darrell Vesterfelt, somebody who has had plenty of partnerships in the past, many very successful and many not ending so well. So I thought it'd be great to get a firsthand experience on somebody who has a lot of partnerships experience because this may be the answer for you. But whether you choose to go down this route or not, it's worth knowing the ins and outs, the ups and downs, the light side and the dark side of partnerships. And there's a lot to unpack here. So let's get into it right after the intro. Here we go.
Announcer: Welcome to the Smart Passive Income Podcast where it's all about working hard now so you can sit back and reap the benefits later.
Announcer: And now your host, he secretly wants to compose a song with Lin Manuel Miranda, Pat Flynn.
Pat: What's up everybody? Welcome to session 412 of the Smart Passive Income Podcast. My name is Pat Flynn here to help you make more money, save more time and help more people too. And today to help us, we have Darrell Vesterfelt you can check him out at DarrellVesterfelt.com or his company, mygoodpeople.com. Actually just big shout out to My Good People. They are the crew, thanks to Darrell and his team, everybody over there, who helped redesign SPI this past year. So the new website design as well as the website design for Patflynn.com. I've been getting a lot of compliments on the design and the look of those and the feel. Well, Darrell and his team are the team responsible for making that happen.
Pat: Darrell is also one of the owners of CopyBlogger now as well as part owner of SPI Labs. He has just come on as a partner on one of my businesses and this is why I wanted to him in today to talk about partnerships and when they make sense to do. Whether you already started in business and you want to combine forces with somebody else for a much bigger, whole bigger thing that you want to create together, or if you're starting a business from scratch, what do you need to look out for because the partnerships are so powerful but as you'll hear can be so painful too.
Pat: So here is Darrell Vesterfelt with the goods. Here we go.
Pat: Darrell, welcome to the SPI podcast. Thanks for being here, man.
Darrell Vesterfelt: Super excited to chat today.
Pat: This will be a lot of fun. We have a lot of things we could potentially chat about. I mean, I can imagine that I could bring you back on the show several times to talk about all these things that you have a hand in. One of the things that you've most recently experienced is being a new parent. And first of all, congratulations. But tell us really quick, how has that been coming from successful business owner, a lot of things going on, to now a little person in the world that you have to take care of?
Darrell: Yeah, it's really fresh and really raw for me. I'm 34 years old. I'm having my first child. The center of my world until this point has been my work, and that little baby, the second that she came into the world, I had two completely clear thoughts. One is I just began to cry and I was completely overwhelmed with love like I've never experienced in a particular way for this little baby. And I'm holding her and she's screaming her face off, but I can't feel anything but this overwhelming amount of joy. And in the same moment, like three seconds later it was like, I'm becoming really clear really quickly that this is now the most important thing.
Pat: Yeah. So how does that effect everything else that you had going on?
Darrell: Yeah, man. I think it's really easy when you are are building business and when you are achieving and striving for success to kind of... It's really easy to kind of just put your head down and go and to not think. And you can just default in the action of what you're building and thinking.
Darrell: And I oftentimes say that you can be really productive at ending up in the wrong destination. And something that happened to me that I experienced and I've heard from a couple other people as well, is that in that moment of having that child, it all of the area, even big and small, where things were out of alignment, even just a little bit internally, it becomes really evident really, really quickly and it has to. And so that kind of happened for me. I was like, man, my inefficiencies in the way that I do meetings is becoming very clear. The fact that I'm overworking myself becomes really clear. The fact that I'm too tired at 6:00 PM to be present with my new baby is becoming really clear. All this stuff kind of came up really, really quickly.
Darrell: And now over the last two months, it's a very strategic way of beginning to realign my life to now shift focuses to be on what's first, like what's most important being first. And that happens really, really quickly. And then you just start to realize that things that maybe you thought were as important like are still important, but maybe they're just like two, three, four level of importance and not number one. And that's been a huge, huge shift for me.
Darrell: I'm beginning to realign my values that the most valuable thing I possibly can do is internal alignment, like internal alignment to my values and to my priorities and making sure that nothing leaps above those new values that are now in my life. And there's 100 other things that we could dive into about losing control and caring for something other than yourself. And the reframe of seeing yourself as the caretaker from being... There's a lot. There's a lot that happens in this new phase of life.
Pat: Yeah, you know my videographer Caleb, that many of you listening know, he recently had a baby. And I haven't seen him for like a month and that's so weird. But we planned it that way and, and everything's great. And I'm super happy for him as well, and you and your family too. I think the biggest lesson here is, whether you have a child or not, having a reason to think about what you're doing and why that is or is not important is really the key. Because like you said, we can kind of just work on autopilot and we get so excited about a ton of opportunities. We start saying yes to everything. I know I went through that both before I became a parent and after. And I definitely had to realign, and it was very clear to me why when I had a baby. There's this thing called the baby effect that I'm not recommending like, "Hey, the way to become efficient is to have a baby." That's not what I'm saying here. But something does happen internally when that happens. So thank you for kind of letting us in a little bit on what's been happening and how you've been working with that.
Darrell: That's really true, man. The efficiency thing's really real. It really happens where all of a sudden it's like, I don't have the time that I used to have to be inefficient.
Darrell: Another thing that happened, Pat, just really quick, is I used to think about parents and be like, "Oh my gosh. Why? What's going on? Their kids completely rule their lives. I'm never going to be like that." And what's funny is getting new perspective, whether it's parenthood or a relationship or a new business, whenever you're kind of outside looking in, it's really easy to make judgements about a certain type of person or how they behave or what's going on. Like you're saying with Caleb, like, "Oh, I'm never going to be the kind of person that disappears when I have a kid." And then you have a kid and every part of the perspective changes.
Darrell: And I think I'm really, really grateful for this perspective shift because it makes me realize that I just have a widened perspective than I had before. It was really, really easy to look at somebody's circumstance that I've never experienced before and be like, "Ah. I'm not going to be like that. I'm not going to be that kind of parent. I'm not going to be that kind of partner in a relationship. I'm going to still hang out with my friends." Even though when you're single you say like, "I'm not going to stop hanging out with my friends. I'm going to be a different kind of partner." And when you have a kid you're like, "I'm not going to disappear for months." And then you're in it and you're like, "Oh, I totally understand." And whatever that shift of perspective thing might be is always super valuable because it just gives you a different and bigger and broader view on the world as a whole, which allows you to connect with people in a way that you weren't able to before.
Pat: Exactly. And I remember somebody telling me this once and it made sense. It's like when you are not a parent and you see... Maybe you might go to a store and you see a kid who's throwing a tantrum and the parents dragging them out. And you're just like, "Oh my gosh, look what that parent is doing to that child. It's so mean. I can't believe that. I would never do that." But then when you're a parent, you look at the same situation and then you go, "Oh my gosh, what does that child done to that parent?" You know what I mean?
Darrell: You go from judgment to empathy really quickly and that's a huge lesson, man. That's a huge lesson that I've taken away from all of this is like, "Oh, I now know, like, I've never been this tired in my life. I've never been so easy to not respond to a text message right away for somebody that's sent me a message." And I understand that perspective in a different way, and it just gives me a bigger view on people and allows me to have deeper empathy and care for people who are different than me.
Pat: For sure. And I know that one thing is that has helped you grow your businesses in the past is the idea that you could partner with other people. And I think more than anyone you have been very strategic, very purposeful with connecting with others and even formalizing partnerships with them to achieve a bigger goal together. Can you take us through a brief history of your work and what you do and how you've gotten to this point and the kinds of partnerships? And you can be as open or not about who you've partnered with. And this will ultimately lead us to our partnership together through both SPI Labs, that's our software company that has a smart podcast player. I've connected and we formalized a partnership with you and your team at authentik.com to be the sort of technical and development team behind a lot of the things that are coming for podcasters very soon, which is really exciting. And then I know that you have some other partnerships in play as well. Tell us the history of your business experience and how partnerships have played a role in that.
Darrell: Yeah. I've been in this like online blogging world. We call it Blogging World back since 2004, and I was actually looking through this the other day, kind of just getting a history, just a review of my history and thinking about I started blogging in 2004. I had my own site, and I started getting a lot of attention on that site. And so I was then helping other people and we called ourselves social media experts back then. So I've been kind of in that freelance world for a long time. Like just a solo guy, freelance guy doing random projects. Managing social media accounts, managing blogs, building blog websites. I've been doing all kinds of just random stuff. And I was a lone ranger for a really long time, just did this on my own.
Darrell: And lesson one that I learned is that I'm incredibly limited when I can just be by myself. So what does that start looking like? Building teams or partnering with people who can help me do more than I'm able to do on my own and kind of through the progression I worked on different teams throughout the years and just started to notice that when I stopped doing the things that I'm not good at, I become much more efficient and much more true to myself and much more honed. And I feel happier with myself.
Darrell: And this became really clear when I started working at ConvertKit with Nathan Barry, and this is where I first met you, Pat. And Nathan said to me our first week together, he said, "All I want you to do is to focus on growth. That is your zone of genius and I'll do everything else. You bring all the customers and I'll do everything else. I've got it taken care of. I've built this company. I've got the teams in place for customer support and dev, everything. You don't have to do all this stuff that you hate. All you have to do is do growth." And I had laser focus for the first time in my life where all I have to do is the stuff that I'm good at. And the success was really evident what we were able to do as a team at ConvertKit. And I felt like part of that was because I was so focused. And so what I did from there... I left ConvertKit a year and a half later because I really had an entrepreneurial desire to build something of my own and left there.
Darrell: And my second lesson there was I can't do it all alone and then I can do much more. And there's a lot more energy in my life and I'm a lot more focused when I just focus on what I'm good at. So I started really strategically looking for partners who could do the things that I'm not good at. And so it just started really informally. I would find a guy who's really good at design. I was a C minus designer, but if I could find a guy who was an A designer, then my A level marketing and growth mind could partner with an A level designer and we could do more together. And the mantra of what that all was is better together. That's just the mindset that was there is I'll be better if I'm together with somebody else. So I became really strategic and just started experimenting with it. And partnerships are super hard for a lot of reasons.
Darrell: I've had lots of failures in partnerships, but I had lots of amazing success at the same time but just really began experimenting with it. And it was really informal. And the first official partnership I had was with my brother actually who is a designer and developer. And we just kind of were doing all these kind of random one off projects, and we were building online courses for authors. We were designing blogs and websites for people. And we then came to our capacity, and we said like we can only do so much. We are at our cap of the amount of projects we can focus on. We are at a cap of the amount of money that we can make. We found the cap of that, and either we can grow a team or we can continue to find partnerships. And I just loved the partnership model.
Darrell: So in January of this year, we officially created a five partner team called Authentik. And we partnered with Brian Gardner, who is the founder of StudioPress. We partnered with Rafal Tomal who is, in my opinion, one of the best WordPress designers, designers in general, but specifically in the WordPress world. Chris Hufnagel, who's an amazing developer. And then Alan and myself. And we said, I think if we take all of our individual... Mine and Allen's little business and all of these freelance businesses together and we build an agency together, we will be able to position ourselves in ways that we couldn't alone. And we'll be better together. So we built that partnership and said, this partnership can continue to extend beyond the bounds of even these five people.
Darrell: So part of our desire is we build amazing websites for authors, bloggers, podcasters, any type of creator. We've done pro athletes, all kinds of cool fun stuff there. And it's a traditional agency in the sense that now we have somebody who is good at the finance, we have somebody who's good at project management. Alan has a master's degree in organizational psychology. So his mind works in ways that my mind doesn't. We have somebody who's good at growth. We have somebody who's good at design. We have somebody who's good at development. We've formed kind of the super team, people who were all good at their particular craft. And through partnership we were able to come together, be better together and do that.
Darrell: And part of our mission from the time that we formed was: is there ways that we can build partnerships with people outside of this five, which is how we came to find a partnership with you guys. Is the ability to be continued to be good at craft that you do while partnering with other people is kind of a shortcut. At least in my mind, it was a shortcut to building a team. I didn't have hundreds of thousands of dollars in monthly income when we started building all of this to go hire a team, but I could partner with somebody. And I could partner with somebody at a level much higher than I could pay because now we are jointly doing this thing together and we are partners on this project together. And it's just been a model that I've really loved. I found a lot of success in. I have a couple of other partnerships that I'm sure we can dive into and talk about later.
Darrell: One is with Brian Clark at CopyBlogger. I've come in as a partner in that project, which is super exciting as well. And I kind of have a mind for growth and online courses and development of an audience, and Brian has the respect of an audience over a long period of time. And so that partnership together we get to kind of stay in our lanes and do what we're good at and build something amazing together.
Darrell: So partnership has really served me well, continues to serve me really well and it's a tool that I really like using. There have been many people though Pat, who have said to me, "avoid partnerships at all costs." And so I think-
Pat: I've heard that before too, which is why I want to dig in deeper. Why are they saying that?
Darrell: Because it's hard. It's really hard. It's kind of like a romantic partnership, a marriage or a partnership there. There are so many levels of communication and understanding and trust that have to be built in a partnership that it takes a lot of effort. And when miscommunication and misunderstanding comes into a partnership, it feels like a divorce. And so it's really, really hard. And so I think there's a lot of things to just be cautious about. There's a lot of things to be aware of and there's a lot of things that like you'll just learn doing it. It just takes time and learning and understanding and building that trust with a partner that is a lot harder than just doing it on your own.
Pat: And that's one of the benefits of having "a partnership." And the way it differs than hiring people is you can have somebody, like you said, come on board who has a specialty, a skill or a complimentary skill to yours to together do something. And you're not even necessarily "paying them," but they are on paper, right? They have part ownership in this thing that you're creating together. Is that formally what a partnership is?
Darrell: Yes. And I want to kind of piggyback off of that. That's really good and really hard, because when people have different skill sets and different perspectives, there's a lot of times that you see one circumstance in two completely different ways, and this is the challenge. In all of my partnerships, there is the ability for that to cause conflict. So it can be great and we can see it can broaden my perspective and whether or not that happens via conflict or via smooth communication. When two people have two different skill sets and two different perspectives, that causes the potential for lots of conflict. And I personally view that as... I'm a huge into personality profiles and I'm an Enneagram Eight, which is a challenger. And so I love the challenge of that. I love like, "Oh my gosh, we see something different."
Darrell: "Let's move into this conflict and I want to see more. I want to see the way that you see it." But that takes a lot of maturity and I don't always have that maturity, but it's an opportunity to grow in that maturity when things become hard and communication becomes hard, but it really is truly like a partnership is partnership. Whether that's done in like a home setting or in a business setting, we all know the pain that can come from misunderstanding and miscommunication and that happens in the business world the same way that does in maybe your home or romantic life. And I think that's one of the benefits and beauty and challenges of partnership is that it can be the highs of the highs and the lows of the lows because of that different perspective and different understanding of things.
Pat: How many partnerships have you had overall just in your entrepreneurial journey thus far?
Pat: Six including ones that you are no longer partners with?
Pat: How many have or would you say just did not go well?
Pat: I think a lot of people would be scared about that. Why do you keep doing this business model if it could potentially sort of fail like this and relationships are involved. I think a lot of people avoid the reward that can come with partnerships because they fear this side of it so much. Can you give us some insight on, I don't know, is it not that bad or is it?
Darrell: No, it's really bad. It's really bad. It's really hard. And again, I think it goes back to... I don't think that there's a right or wrong here, Pat. I think it's about who you are, and it's again about knowing your personality and understanding yourself. And for myself, I know I operate best in partnership. I know I operate best when I have a challenge. So I continually love the challenge of partnership because it allows me to become better. It's like the forge. It's like I'm being forged into something different. I can't go into partnership and be the same person on the other side of it. And I like that challenge and it's really hard. And so even though I've had things end in lawsuits and lawyers involved and that is really painful emotionally and it's painful financially. And it's sometimes just part of how relationships go. I can't force somebody to have the same perspective that I have and sometimes we don't respond the way that we ultimately hope and would like to.
Darrell: At the end of the day I continue to do it because I believe in the power of connection and the power of team and the power of focus and doing what I'm good at and not doing things I'm not good at. And creating an environment where that can all happen and that can happen many ways. Like you can achieve those same things by building a team underneath of you in a traditional sense as well. But I like partnerships because I like it when people have ownership with me in it too. Like you're as motivated to show up today as I am because we both own this together. Like we're in it together. And I love that. I love it. It feels like I can trust that better than I can trust somebody I'm just maybe paying a salary to a every day. Because as much reward as we can have, you have as much risk and so we're like really in this together and I really like that.
Pat: I 100% agree with that. I mean, I've experienced the same feelings with Matt who is a partner with me on SPI Media. I've experienced that with Caleb obviously with the switch pod and just us both showing up and wanting to build something amazing and doing it for the greater good is awesome.
Pat: So let's say for example, somebody is listening to this, Darrell, and they're like, "I have this idea. I have these skills and I know I'm going to need other people to support me. I don't have the funds at this moment to hire somebody. But I think a partnership with somebody who can fill in those holes and we can do this together would make the most sense." I remember getting a lot of questions about this back in 2009 when I formed an iPhone app company with one of my high school friends and a lot of people were like, "Oh I'm going to create an app. I'm going to create an app." And they didn't have the funds to sort of find a developer, but they were like, "Ooh, I could potentially partner with somebody and give them ownership." But then it was like the, that's as far as it went for them because it was just so complicated at the start to figure all that out.
Pat: How does one figure out how to bring somebody on board as a partner right from the get go? What are those first steps? What do we have to look out for? Where do we find those people? Can you give us some insight based on your experience?
Darrell: Yeah, so I started doing this back in... This was in 2012 or '13 when I first started doing online courses. My business model was I had worked as the director of marketing for an author who had a large brand. And I helped him create and launch his first online course. And he did really, really well. And I knew that I wanted to do this for more people. And so I left and created my own "agency." The agency was technically just me. It was an LLC, it was just me. I was the sole member of that LLC. But I knew a few things.
Darrell: One, I don't have an audience, so I could create an online course, but I have no audience to sell it to. This is going to be a complete failure. So I've got to partner with somebody who has an audience. So I found a friend and he had wanted to develop an online course. Now I had the experience, so I brought experience to the table. He had the audience. Now it was a match made in heaven. Great. And we didn't form a business together, but we formed a partnership on a product that we were going to build together. But then there was a problem. I didn't know how to shoot videos. I didn't have video editing skills. So I had to find a video person. So we'll just kind of use simple numbers, but like say this author and I were doing a 50-50 split. I'll build all the course and you have the audience, we'll sell it together and it'll be a match made in heaven 50-50. So from my 50% now I had to find somebody who could do video and again, one of two options.
Darrell: I could either pay for somebody to do that, which would cost if I want to do high quality, $10- to $15,000. A lot of money. Money I didn't have at the time. I was in my mid-20s, and I didn't have $10- or $15,000. So I called up one of my buddies who I knew did really good video and I said, "Hey, this is what I'm thinking. I have this partnership with this author. This is the size of his audience, and this is the product we're trying to develop. What if I gave you a cut of my profits for you to create this video at no cost to me?" He's like, "That sounds awesome." Because the potential for him was he maybe could make more than $10- or $15,000, but he had to take the risk upfront of doing this work for "free" to then have a partnership on the upside later.
Darrell: And so then we kind of formed our own little partnership agreement on the side and it was like now the pieces were starting to come together, right? I had no money and no business and no prospects, and I just started building this thing by finding people who had the gap. And I could fill in that gap either with a relationship that I had or with a skill set that I had. And so just kind of forming these like joint venture partnerships together, I learned really quickly that I could start making serious money without having, one, any money, any audience, and just kind of leveraging relationships and this idea and concept together. And that turned into creating something like 25 courses over the lifetime of that idea with authors who have really large audiences. And it was a win for everybody. Everybody was winning, right?
Darrell: I was winning because I was able to use my skills to access audiences that I didn't have to spend 10 years building. It was a win for this author because they could build courses without having to spend the years of learning how to build a course the way that I had to. They could just do what they're good at, which is be a writer and be a creator. And then it was a win for this video person because this video person, they just made a standard rate when they did projects. And now they have the ability to make more money based on the performance.
Darrell: And what was really cool, Pat, is everybody was bought into the success. So I know that this video guy was creating better content for me, and I wasn't paying a single dollar up front because he was bought into the success of this thing long term. I was showing up in a way because I knew that if I worked an extra five hours this week on this project, it could maybe result in more money. And so everybody was bought in kind of on a "ownership" level, and I just learned how powerful and beautiful partnerships were in that time. And I was kind of hooked on it because everybody was winning and everybody was getting their needs met and everybody's doing what they're good at and it was just a really fun, fun set up.
Pat: That's really cool. Legally, what does one need to talk about? What are the steps that need to happen? I know because now I've done this myself. It's not a just sign up on Legal Zoom and everything's good. There's a lot of conversation that needs to happen. There's a lot of this is a partnership. We need to both be in the same boat and understand the same things. How do you do that? What needs to happen legally? What needs to happen? Is there money involved? Just people listening I know are excited but also scared and the weight of this seems very big.
Darrell: Yes. So agreements are everything in a partnership like this, and I've learned that the hard way. Setting clear expectations up front. Having documents in place are really, really important. And finding a lawyer, and this is kind of part of the tension of building a partnership, especially when you're really at the beginning phase, is it's really easy to shake somebody's hand and agree to something verbally. And nobody ever goes into a partnership expecting that that partnership would go bad, right? Nobody ever does that. Everybody has the highest of hopes, the best intentions when going into a partnership. And it doesn't matter how close you are to the person, how well you know them. Whenever money is involved and whenever there's an opportunity for misunderstanding or miscommunication, it can get messy and it can get messy really quickly. So legally there's a lot of different ways that you can structure it.
Darrell: You can join together in forming a company together like an entity together and having a lawyer that can help you draw up documents. Like an operating agreement that really clearly states how you guys are going to settle disputes, how you guys are going to maybe dissolve the partnership later on if you guys both want to. Having that stuff in writing is really, really important. It can be kind of expensive but one kind of trick to do that, Pat, is to find templates for things like partnership agreements, operating agreements online and kind of filling it in yourself and then having a lawyer review it instead of creating the document from the ground up.
Darrell: And that's one way that you can kind of skip some of the high level costs because some lawyers are like $2-, $3-, $400 an hour. That's just not feasible. It wasn't feasible for me at the beginning, which is why I just of did these handshake agreements. But I wished that I would've gone back and found like some of these shortcuts of like going to... Like I've Googled operating agreement template and then I can download that for free, and I can kind of fill it in myself and then send it to a lawyer. And it'll be like a third of the cost then getting it in place. And so again, there's lots of ways you can do it. You can find the entity together. You can form your individual entities and then do like a joint venture agreement together. There's a lot of different ways that you can go about that. But I would always advise getting the counsel of a lawyer who knows about partnership.
Pat: What are the must haves in there? Because I know I have heard horror stories where just certain things weren't talked about, and if only it was a conversation they had, everything would be different or changed. What are the must haves in there related to an agreement?
Darrell: The two that come to mind for me are the ones that I mentioned. One is how do conflicts get resolved? That's number one. And then number two [crosstalk 00:30:36].
Pat: How might conflicts been resolved before we move into the next one.
Darrell: Yeah. It depends again on how many partners are involved. One of the companies I'm a partner in, we have what's called a super majority. And so there are three partners and everybody owns a different percentage of this company. And there has to be a super majority or a percentage of equity vote to go forward. And then there's a list of things that have to be decided unanimously. And so that's really clearly defined, right? So if we disagree on this set of things they set of things could be how to handle finances, how to handle a team and staffing, how to handle marketing. If there's conflict here, there has to be a super majority vote.
Darrell: Now there is another set of things that have to have unanimous decisions. It could be things like selling the company or dissolution or other things like that. And you can kind of see some of those things when you do a template. And so in those cases all three partners have to agree otherwise it doesn't go through. It doesn't pass.
Darrell: And so there are different levels of how you can handle disagreement. And again, all of it's a spectrum and there's like a sliding scale of what you and the person you're working with feel most comfortable with. But even having that conversation up front saves a ton of time. So now I go into a disagreement or a potential conflict with my partner. And because I know how this is going to work, I don't come in guns blazing in the way that I might have if we weren't clear about how things were happening and just having that is super, super important.
Darrell: And then the other thing is just like a dissolution. Again, this is really hard for somebody who is kind of starry eyed about partnership, myself included, and I wish I would've had these in places in a couple of circumstances that end up being really hard at the end, is if this doesn't go the way that we expect it, how do we easily without drama split up and that just kind of being clearly defined again as a wide spectrum of what that can look like. But it's kind of like, this is not a perfect analogy, but it's kind of like a prenup in a marriage. Hey, I'm bringing this into the partnership. You're bringing this into the partnership. If we split, you get the things that you started with and we're going to split the new stuff this certain way. And again, it's not a perfect analogy but it's similar to that in the case that things don't go the way that you would want them to. So those are the two big things that jump out that I think are really, really important in some sort of partnership or operating agreement.
Pat: Cool. That's really helpful. I have just a couple more questions on this for those who are listening and then I also want to move on to something that I know you have expert knowledge in that I think would be helpful for everybody too, related to content and where the web is going and all that sort of stuff. And the authentik.com team did so much great work for us. If you didn't see it yet, head on over to smartpassiveincome.com or patflynn.com. They designed both of those websites and they just turned out tremendously. Thank you, Darrell, for that and just been getting a lot of great feedback on that lately. So thank you.
Pat: But on partnerships, one last thing. If you don't mind me asking, the partnerships that didn't work out, what happened? Why didn't they work out?
Darrell: Yeah, they're not specifically the same reason but they kind of all come down to just misunderstanding and having different expectations.
Pat: Ah, okay.
Darrell: So misaligned expectations become exposed in one of two ways. One, when you are more successful than you thought, and two, when you're less successful than you thought. And so when there becomes a lot of money coming into the company and all of a sudden you're like, "I feel like I'm working harder than this partner. Why am I getting paid the same amount as them?" That's something that can come up or this partner messed up and the other partner feels like they mess... Like there's a lot and again, all of it kind of can get solved if you go back to like how to resolve conflict.
Darrell: And in one of my partnerships, I felt crazy as it was kind of falling apart. I felt absolutely crazy like my mind... I felt I was losing my mind because I so clearly cared for this person. I so clearly cared for our partnership. I so clearly cared for an outcome that was good for both of us but we didn't... For whatever reason, the way that we were communicating about it was—it was like I was saying one thing and they were hearing a completely different thing, and what they were hearing was completely offensive to them even though I wasn't intending it that way and vice versa. And it kind of spiraled into this place of like the only way we can resolve this is by like splitting up. And I think communication is the single greatest factor in successful partnership. And sometimes that means saying really hard things and doing really hard things and it's again, I equate business partnership to like a romantic partnership because if you're feeling something or seeing something and you just choose not to say it, like just walls start to come up. And communication becomes different.
Darrell: This is not just verbal communication. Even non verbal communication can come up like, "You're being distant to me. Why are you being distant to me?" And it's like, "Because I feel awkward and I don't want to talk about this subject." And it's like people can read those things and feel those things and sometimes it means having hard conversations that we don't want to have. And in any type of partnership, the longer you go not saying something that you're feeling or saying something that's going on, the more conflict that can arise.
Darrell: And I think that happened with my partner and I is like there were some expectations that we had that weren't met, and we didn't communicate about it. And then it kind of came to a head and kind of exploded into this really bad communication point. But all of it could have been fixed by quicker communication. All of it could've been fixed by more clearly outlined communication at the beginning of the partnership. And to be honest with you, Pat, we were doing the best that we could. Like this was an early partnership for me and both of us were doing the best that we can. And we learned invaluable lessons about partnership and about business that we've taken on to more successful things in the future, both of us.
Darrell: And that's why I say like I'm not afraid of things failing because it's like as long as I use that as an education to move forward and do things better in the future, it's incredibly valuable. It's not all monetary. And so then I've had a partnership split since that time and it's gone a lot more smoothly, not perfectly smooth. It's still painful, but it's gone a lot more smoothly because some of this stuff was all figured out and it's like, "Hey, this isn't going the way we either of us thought. It's time to split ways." And it's sad for both of us. And it's painful for both of us, but it's a lot easier, Pat, because I've learned so much about how to communicate during this time. And we had really clear communication and frameworks and operating agreements and non-disclosures and all kinds of like crazy stuff like that that just make it easier for us because we agreed upon this when things weren't hard. It's really, really hard to come to agreement in terms on something, especially like a split of a company or split of a partnership when there are emotions involved and things aren't going well. So kind of having that done beforehand is super important.
Pat: And there's also good split ups, right? Where it's like one person's done their job and it's like time for them to move on and then you can sort of like—I don't know, I don't want to say cash out—but you kind of like redeem the options that you've had in the business, and somebody in there buys it. I mean there's a lot more complicated sort of financial related things that can happen in partnerships.
Darrell: Well that's exactly what happened at ConvertKit with me. I was a partner, obviously as like a small equity holder in that company. And Nathan and I had long term plans together, and we had a lot of success. And a year and a half and it was just like, I looked at him and I said, "Hey, I think I need to go." And like we both cried in a good way and we high fived and we're still friends. And we had to like figure out what that separation was like. And there was some level of, it's still not easy, but I'm still friends with Nathan. I just hung out with him in Nashville here a few weeks ago, and it was a little bit different. We weren't 50-50 partners and I wasn't a cofounder in the company, but there was still some level of partnership in it.
Darrell: But taking the lessons I learned previously, I was able to learn and just say like, I'm going to tell Nathan how I feel now instead of letting this blow up two years from now. And I did, and I moved on successfully. And I'm still an affiliate for ConvertKit. I still teach people ConvertKit. I'm still friends with all the people that I worked there with, and it was a really positive thing for everybody because everybody is kind of being moved in the direction they need to be moved in. That can be a very positive thing as well.
Pat: Sweet. Well thank you for that sort of a, man, that low down on all things partnerships both high and low. So thank you. I think that's going to be extremely valuable for people. I'd love to shift the sort of last portion of the conversation here to talk about sort of web content. What's happening? You and your team have obviously had a big influence and hand on the way content is being produced for SPI Media now. Give us some thoughts on how we can sort of shift our focus to where things are going, especially related to web, content, design. What do we, all of us listening need to be paying attention to?
Darrell: Yeah. This is something I'm super passionate about because again, I've been in this "blogging" world since 2004 and the world... Think about the world in 2004 and the world in 2019 and how different it is and the way that we consume content. Back in 2004, we were watching TV shows like Lost and 24, and we were waiting for those shows to come out every single week. We'd watch it for an hour. You'd have to show up at your TV at a certain time and watch that show and then wait for the next week. And if you missed an episode, the only way to watch it was to wait for the DVD box set to come out. If you were a really big fan of one of those shows, your life revolved around content being delivered in that way. Now let's think about 2019. If Netflix doesn't release a new series with all of the episodes, I'm pissed because I want to watch all of them right now. I don't want to wait until next week. And so we've just consumed content differently.
Darrell: And so the way that we used to produce content on the internet back then was kind of like that broadcast television model. Where we said, "Hey, here's a blog post today and here's a blog post tomorrow." And if you were really advanced, you had a strategy about how you release that content. But oftentimes it was like, I'm posting this and you're here today and you read it. If not, it's going to get buried in the archive and you're going to have to search for it and try to find it later. And I think that there needs to be a shift in the way that we think about creating content where we think more like Netflix and less like broadcast television. And so that was a huge conversation that the authentik.com team had with you guys at SPI is... Pat, you've been creating content for how many years now?
Pat: Over a decade.
Darrell: Over a decade. So there's a ton of content. So if somebody comes to your site, how are they going to find the content that's relevant to them? And if they happen to find one post that's relevant to them, how are they going to maybe find the other 10 that are also relevant to that topic if they're really interested in it.
Pat: Right. It usually looks like, "Hey, here's our entire archive. Go figure it out. And good luck."
Darrell: There's not a lot of strategy to how that content is organized. And the person that I actually learned this from first was Barrett Brooks when we were at ConvertKit. And we put this model in place in the blog when I was still at ConvertKit, and this was the kind of Barrett's brainchild. But if you look at the ConvertKit blog, they've released issues. And so there is an issue about how to start an online course and there are eight blog posts in that issue, and it's really easy to navigate between those blog posts about this particular topic. And they don't have anything more to say about it. So they're done writing about it.
Darrell: And I saw a lot of pain points in the way the content was being created. And what happens is there are some people—and people most notably in this category are Seth Goden and Gretchen Ruben—people who wrote every day on their blog for a long period of time and built a huge audience, and they both started in the early 2000s doing this type of thing. They built massive followings just writing every day. And a lot of people follow that same model and now there's this archive. And a lot of people have a lot of archived content.
Darrell: So one of the pain points are how do I continue to have a good content strategy without feeling burnt out writing the same things over and over and over again? How many possible blog posts could you write about podcasting, Pat? At some point, you're not an infinite mind. At some point, you're going to have enough to say about a topic. And so this pressure to feel like I have to write and write and write for infinity is unrealistic. And people were starting to get burnt out with that. And so people would just stop writing on their blogs altogether. And so you'd go to their site and you'd see either podcasts or blogs or YouTube videos and people just stopped. It was just over. And it's like because we don't have infinite amount of things to say about a topic. At some point, I'm done.
Darrell: And so kind of releasing that pressure from people thinking about the new Netflix consumption style versus broadcast television style. We've started helping people rethink how to do content marketing and building content on the web for a modern world versus just this idea that you have to post in your blog three times a week. And so a lot of this is built around like pillar or foundational content and saying, what am I trying to say? And let's get three or four or five pillars of content. I'm trying to talk about podcasting or I'm trying to talk about creating online courses or I'm trying to talk about affiliate marketing. Those are our three for you that are super important.
Darrell: Now under those pillars, can we group content that we've created over a decade. Can we start grouping content together so that it is grouped in one way, it's easy to navigate, and now when people find it, they're going to find more value from your site. Versus trying to like go to that like little search widget and just typing in a word that they hope maybe brings up a bunch of blog posts and having to scroll through 15 or 20 posts that aren't relevant to them to find the content that is relevant to them. It's kind of like channel surfing. If you're bored on cable and you're just channel surfing, maybe you'll find something that's interesting to you, but more likely you're going to find a bunch of stuff that's not interesting or relevant to you. But with Netflix I can go directly to find the thing that I'm looking for, and it's really easy and then I can just start watching the thing that is interesting to me.
Pat: Well, even beyond that, Netflix will tell you, "Hey, based on the things that you've already looked at, these things may also be helpful for you too."
Darrell: Exactly. And so then I started thinking about this more and I started talking to my friends who were SEO experts, and I was like, "What happens if we stop writing on our blog all the time? Will that hurt our SEO rankings?" And they were like, probably, but there are some ways around this, and the ways around this are updating content and other ways of thinking about cool SEO strategies.
Darrell: So one thing that's really cool about this new model, what I'm calling the Netflix model of web content is, or content marketing, is when somebody comes to your site and they find one of these groupings of content, whether you call it an issue or a guide or whatever you might call it, they're likely to stay on your site longer because they're reading content that's relevant to them. And they're likely to click through multiple pages at the same time because maybe there's seven steps in to starting a podcast and you've written a blog post about all seven steps and it's grouped in a really easy way to navigate through.
Darrell: So those are two huge benefits to build SEO juice for your site is time on site, and number of pages visited. And so this is why sites like old school Buzzfeed, they'd be like, "Look at the 15 best dressed people at the Met Gala last night." And then you'd go and it'd be like one person you have to click on another page and another page and another page is they wanted you to stay on the site for longer and they wanted you to click more pages while you were on the site. And I think we can take a strategy like that and put it into a high quality content view and say, "Hey, let's give this content to people in a way that's really helpful for them while also accomplishing our goal of having them stay on the site longer and clicking more pages." And so it's this win-win knowledge of like, I'm going to make my site more relevant to people where they can find content that's helpful for them while also checking off some of these SEO checkboxes to make my site a little bit more powerful in the meantime.
Pat: And the sub pages can target specific sub keywords as well, so they're all relative, which helps Google understand that you're sort of the authority on that topic because it's not just like one giant blog post now. Now it's a bunch of longer blog posts about a particular topic and subsets of that topic, and then it essentially is almost treated like a... The way we talk about on the team, it's almost like books about that topic on the web. And this is why when you go to smartpassiveincome.com now you'll see just right there on the homepage a list of our guides. And we have more guides coming too, and there's the business fundamental guide and that was produced by Matt. And I have the podcasting one and there's the book publishing guide that we recently published as well. If you haven't checked it out, you've got to check it out, smartpassiveincome.com. You can see the sort of siloing of content happening, Netflix model grouping. And I think that this is just, it makes sense for user experience in just the lack of time we all have to go and find stuff, and how much more used to we are as people now living today to just, we need something, we find it versus let me channel surf.
Darrell: Exactly. And another benefit of this, Pat, is when something changes, like say something changes in the podcasting world, instead of writing a new post about podcasting, you can just go in and update one of those older posts that are there. And this relieves so much anxiety from my friends who are content creators. It's like, "Oh my gosh, I don't have to rewrite a whole new thing. I can just go in and update that." And it's my understanding, again, I'm not an SEO expert so I don't want to pretend like I am, but my understanding from research and talking to people who are is that Google views updating a post very similarly to posting something new. And so you're not losing that juice of like not posting all the time as long as you're like regularly updating posts on your site and making sure things are relevant for where we're currently at. And that is a much more sustainable way to have very powerful content.
Darrell: And another thing that really makes people happy about this path is you can have really focused times in your business. So maybe you're in a creation, like a season of creation and you're creating all this content around some of these guides or pillars and then when you're done, you don't have to feel the pressure of continuing to create and you can go promote that. And promoting a guide is so much easier than promoting a eBook or a single post or things like that. It's like all this content is all right here. It's super valuable, it's really easy to navigate and that is a much easier thing to promote externally to bring more people into your audience than it is the old school model of like, "Oh, I have this one eBook," or, "I have X, Y or Z."
Darrell: And so you can kind of like flip flop and take different seasons of focus different times if you're like a solo person in this business, and that's been a really, really appealing thing to a lot of our clients is, "Hey, I'm going to remove this pressure for you to write a blog post every single week for infinity. I want you to write five about this topic and then I want you to go talk about it to as many people as you possibly can and get them to come back to this site and see this really, really valuable content that you've written. And you can kind of like not feel this pressure of like this infinite content creation cycle.
Pat: Yeah, I mean it's huge. It's been a big relief to not feel like I have to come out with a new blog post every week for example, but I can just make sure that the content that is on the website is up to date and up to par. And then when we do publish something like a new guide for example, that goes deep into the topic and sub-topics related to it, we can spend more time promoting it, getting in front of people like you said. And to me that's just what I feel is a better experience and it's just much easier to manage as a team.
Pat: And then my goal, and hopefully people have been feeling this now and maybe less on the website since it's still pretty brand new, but we want to get to the point where people are anticipating that next guide, like they're anticipating the next episode of the podcast. And that was a struggle we were having with forcing a blog post every single week. There was no anticipation because people didn't know if it was for them or not. Versus we can promote even content coming out very soon. Like, "Hey guys, we're writing a guide on X, Y, and Z. It's going to come out on this date." We can almost launch it. And that becomes a huge value add, a free thing that people can get access to. And of course internally we know, hopefully that'll grow our email list, lead people into some funnels and serve them even more if they want to go deeper. It just makes sense. And so I love that, and I'm hoping that we can be a good sort of example on SPI to sort of encourage people to start thinking about their content in the same kind of ways.
Pat: So thank you again for you and your team for helping us structure SPI in that way. And I hope that is making sense to everybody because that's so important and it's a win for everybody.
Darrell: It really is. It's a win for everyone. It's a win for you. It's a win for the audience. It's a win for everybody involved. And that's how you do business well is finding wins for everybody.
Pat: Totally. This has been a win for me for sure, to spend this time with you, Darrell, to learn more about your partnership history and to get this amazing content for everybody listening in. Where can people go to find out more about you and where would you direct people to?
Darrell: Yeah, you can go to authentik.com and Authentik is spelled a A-U-T-H-E-N-T-I-K.com or you can find me at DarrellVesterfelt.com, and I actually have a link to schedule a 15 minute call with me on that page. So if you want to talk more about your site or your projects or partnerships, feel free to hit me up there as well.
Pat: Dude, thank you so much for this. Highly valuable. I appreciate you so much and look forward to chatting on one of our upcoming team meetings.
Darrell: Thanks Pat.
Pat: All right. I hope you enjoy that interview with Darrell Vesterfelt, again a partner with me now on a couple of businesses. I'm just really excited for our future together and your future with you and your future partners, should you choose to go down this route. It's not always the answer for everybody, but I think the big theme here is just really get to know that person before you commit to a partnership. Really make sure you hash out all the possible scenarios, and you want to have these conversations upfront instead of on the back end after things may not have gone the way they should.
Pat: So super stoked for you. And Darrell, thanks for so much for coming on. There's a lot of links that we mentioned and people that we talked about. You can check out the links and the resources mentioned in this episode at smartpassiveincome.com/session412. Again, smartpassiveincome.com/session412. And again, props to mygoodpeople.com and the team over there helping design amazing websites like SPI, patflynn.com. They've done a lot of other websites that I've seen on the web that are just amazing. So thank you guys. Thank you Darrell, and thank you for listening all the way through.
Pat: Make sure you subscribe to the show if you haven't already. We have a lot of great content coming your way in the upcoming weeks. This year is going to be amazing, and I'm just very thankful for you to be a part of it as a listener, as a subscriber, as a follower, as a supporter, and I'm looking forward to seeing many of you at FlynnCon here in San Diego coming up in July this year. Hope to see you there. Cheers. Thanks so much. And as always, Team Flynn for the win. Peace.
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