Projects Don’t Build Businesses | Jon Morgan

PROFITABLE TALKS...

In this episode of The Profitable Creative, host Christian Brim interviews Jon Morgan, founder of Rival Studios, who shares his journey from aspiring pastor to successful entrepreneur in the creative business. Jon discusses the evolution of his company from JM Films to Rival Studios, focusing on video production in the sports industry. He emphasizes the importance of sales, hiring challenges, and the impact of AI on creative work. Listeners gain insights into pricing strategies, navigating project-based work, and the significance of understanding client budgets.

PROFITABLE TAKEAWAYS...

• Jon Morgan's journey began in digital media during high school.
• He transitioned from aspiring pastor to entrepreneur after being laid off.
• Starting JM Films, he focused on video production after realizing his strengths.
• The shift to Rival Studios marked a commitment to the sports industry.
• Networking and perseverance were key in breaking into sports media.
• Sales became a crucial focus for sustaining the business.
• Hiring challenges led to a reliance on freelance talent.
• Project-based work created cash flow inconsistencies.
• Understanding in-house vs. freelance models is essential for growth.
• Pricing strategies evolved from competitive to value-based approaches.

Get your copy of Profit First for Creatives ➡️
https://forms.coregroupus.com/profit-first-for-creatives-book-page

Paying too much in taxes? Let's fix that! ➡️
https://forms.coregroupus.com/scorp-booking

Transcript

Christian Brim (00:01.314)
Welcome to another episode of the profitable creative, the only place on the interwebs where you will learn how to turn your passion into profit. I am your host, Christian Brim. Special shout out to our one listener in Arvada, Colorado. I heard that and I automatically thought carne art of Arda, but that's New Mexico, not Colorado. In any case, thank you for listening. Joining me today, John Morgan of Arrival Studios. John, welcome to the show.

Jon Morgan (00:31.272)
Thanks, Krishan, appreciate you having me on. So looking forward to talking about creative business stuff.

Christian Brim (00:36.91)
Well, you are the expert on it. So I want to hear how, I want to hear how. So give us the brief CV, you know, what, what you've done, your, your journey as an entrepreneur.

Jon Morgan (00:43.016)
you

Jon Morgan (00:50.802)
Sure, that's quite the interesting journey. So I'll kind stick to the high level of it, but got my start in digital media, creative, you know, video and all the things back in high school. Took some digital media classes. believe it was freshman, sophomore year of high school. So that's when I learned the basics of video, but also, you know, some graphic designs, photography. Knew I had a creative eye, but...

never in my wildest dreams did I actually think I'd ever pursue a career in it. And so as high school went on, I continued to just keep it as a side hobby, friends and family and little summer jobs and stuff like that, making a little bit of money. And then throughout college, my plan was to be a pastor and a counselor and felt like God was calling me to ministry. And so I was pursuing that and formally with psychology and Christian studies as my degree and minor.

And then again, continue to do some AV video stuff, you know, in the summer, kind of here and there. And then met my wife in the college. And then that's of course where everything changes. I was not quite, not quite. She was at least open to the idea initially. And so I finished school. I was down in Mississippi. She was up here in St. Louis and

Christian Brim (02:03.22)
Yeah, she said, I don't want to be a pastor's wife is what she said.

Jon Morgan (02:18.952)
So we did the long distancing for a bit and so we were engaged and then when I finished school that I came up here to st. Louis and couldn't find a church job and Just supplying and nothing's working out grad school plans weren't really working out the way that I had hoped And so I took the only job I could get was at a plastic manufacturing company with my father-in-law. So her dad worked at a company and Created a quasi marketing sales creative position for me

Christian Brim (02:40.461)
Okay.

Jon Morgan (02:45.862)
So it was a little bit of everything from making cold calls after trade shows to doing marketing slick and some website and photo and all of that. So that kind of got me back into the creative space and mindset. And so then I did that role for about a year and a half, give or take. And that was in summer 2015. And then the company was downsizing and we both ended up getting let go.

Christian Brim (03:10.862)
You got your father-in-law fired? Is that what I hear? Okay.

Jon Morgan (03:13.254)
No, he was technically first to go and then I was second to go. So, little known fact, I actually took his job for about two months and it was really awkward. Yeah, he does. so that kind of dumped me on the, you the, doorstep and the reality of like what it's like to get laid off. And, I didn't really have another plan. So that was September of 2015.

Christian Brim (03:20.47)
How does he know this? Okay.

Jon Morgan (03:37.568)
And so without telling anybody, I decided just to start my own business on a whim and see if I could do something with it. And came home and told my wife that, Hey, I'm a business owner now. And so initially it was just to, it tended to be a stop gap until we found the next plan or I found them figured out the next plan. Cause my wife was teaching at the time. And so there was a little bit of a time period where figuring out her, her career as well.

So I was like, okay, well, let me just try this freelance thing and I've developed some skills and see what I can do with it. so I initially was starting out doing everything from logos and websites and photography and video and just all the all the things. And then about six months in, you know, no other jobs were really panning out. And so I was like, okay, I need to figure figure this out. Like, I mean, they're going to really make a go at this business thing or I need to just hit the U-turn.

you know, make the U-turn and get out before I get in too deep. I bravely or naively one decided to give the business, it's an equal combination of both. Okay. You got to have, you know, brave, you have to be brave and naive. Right. Right. If only if I knew what I was getting myself into, you know, I might not have done it, but so anyway, I took the plunge, but I realized that I needed to focus on something. I wasn't doing that well doing everything.

Christian Brim (04:42.52)
Both, it can be both. Yes.

Christian Brim (04:49.334)
You're, you're brave because you're naive. That's, that's the way I remember it.

Yeah.

Christian Brim (05:05.163)
Hmm.

Jon Morgan (05:05.168)
And so that was when I decided to shorten my name at the time was JM Film and Design. So I lopped off the design part, just focused on video and called myself JM Films. And so then that began the journey of becoming a corporate video production company. And again, no entrepreneurship experience, no real business experience, just learning everything from school hard knocks.

So I worked with some business coaches and consultants along the way at different points just to help me learn business and stuff my face with as many business books and sales books as I could read. Because I quickly learned that if you don't sell that you can go out of business. So I realized that I had to get good at sales and get good at business if I was going to stick around. And then as things grew, I decided that it was a better

Christian Brim (05:43.756)
Yes, it's it's a short tenure if you don't sell

Jon Morgan (05:58.578)
better model for me to start bringing in other people into the productions who were better at different roles than I was. So I was shooter, was editor, was everything. And it just was not, I mean, was doing good, so to speak, but not really great. And so that's when I just...

Christian Brim (06:14.446)
It's kind of hard to hold that boom mic when you're also running the camera. I mean, it's a little difficult.

Jon Morgan (06:19.132)
Yep. it is, it is. so then that's when I started hiring some directors and some DPs and just some more people getting them involved in the production. then, of course that helped elevate the production quality. And so that's where things kind of started to take off and snowball a little bit. but we're still going after anything and everything. And so a few years into that, I just realized how, how tough it was, going after every industry, doing every type of video from big and small and

Trying to be the expert in all these industries is really tough. It was the fall of 2019 that I stumbled into my first opportunity to get into sports. I'm a big sports guy and always had the dream of what if there's something in sports I could do. But I didn't have anything to show. didn't have anything, as you know by now, sure, as creative as we're only as good as our last project.

What we've done helps get us in the door for what's next. And so I got hired to film a little high school football video about a high school football player. And so that was my first thing. And then I was able to use that to turn it into a bigger opportunity to get to work with University of Illinois football in the fall of 2019. And so we did a cool hype video for them and a couple other videos for recruiting for about the football program.

and had totally had no idea what I was doing. mean, we, a lot of creatives talk about the imposter syndrome and that was, that was my M.O. that fall. was trying to broaden my shoulders, act like I, you know, knew what I was doing in sports, but in reality I had no idea. So praise the Lord, that the videos turned out great. And so that will give me a big confidence boost of like, okay, we can, we can do something here, but I have no idea if there's a market for this. So I was like totally hooked on sports, but

Christian Brim (08:12.919)
Right.

Jon Morgan (08:15.976)
I had no idea if I could make a sustainable business out of just sports videos, or if it would just be another industry that I would go after in addition to all the others. so I realized that if I wanted to make a go at it, I needed a better sounding, cooler sounding name in JM Films if I was going get into sports. And so on a whim over the course of weekend, I came up with the Rival Studios brand and slapped together a new website. And this was January of 2020.

Christian Brim (08:23.854)
Mm-hmm. Mm-hmm.

Jon Morgan (08:45.72)
And then as you know, fate would have it, the world shuts down and sports go dark about three months later. And then question all my life decisions. What did I just do? Here I was, know, bright eyed, bushy tailed, know, energetic to grab the sports world and here sports world comes crashing down. And so it took me the next two years to just learn the industry. And when I talk about, when I say, you know, I, I hustled and just pounded the pavement. mean, I,

Christian Brim (08:52.973)
Hahaha!

Jon Morgan (09:15.304)
That was me for two plus years where I was traveling, starting to travel all over the country to go to sports conferences, did No Assault and showed up and started handing out my business card and trying to meet people, make contacts, learn the industry, where and how these teams use video and production. And so then did that for two solid years. I I sat in a desk very similar to mine right now.

Christian Brim (09:18.55)
Mm-hmm.

Jon Morgan (09:43.78)
and we just cold call, email and cold call, cold email and cold call all the college football programs in the country. I mean, just smiling and dialing, just trying to get in the door, open up some opportunities. so then the fall of 22 was when it started to actually take off and things started working because after a while, if you do this for two years and not much luck, you really test your perseverance. And it's like, man, am I crazy or is there something really here?

Christian Brim (09:52.184)
Yeah.

Christian Brim (10:08.205)
Yes.

Jon Morgan (10:12.808)
So the fall of 22, we got our first few big teams. We got awarded some work with Carolina Hurricanes and the St. Louis Blues here in our backyard. And then also St. Louis University, we did their basketball intro videos. And so that was a big sigh really, because it was like, okay, I'm not crazy after all. Like something, I've got something here. I knew the market a lot more. I certainly had more experience now. So then going into fall of 23.

Christian Brim (10:32.398)
Yeah.

Jon Morgan (10:41.0)
spring of beginning of 23, that's when I decided it was time to go all in on sports and take everything else off the website that wasn't sports and then just make the plunge. And so then it's been three years now, this January that we have only been in the sports market. So what we do now is we primarily work on, we've primarily been on the team side. So we work with a ton of pro and college teams helping with their media day productions.

and do a lot of video board and Jumbotron content from intro videos and height videos to graphic packages and all other types of stuff. But we're quickly growing into other areas of work as well in the sports world to work with broadcast networks and some of leagues and conferences and sponsors and brands and racing and golf. And there's so much within the sports world. So sports is unique in the sense where it's a very niche market, but it's also a very diverse market as well.

Christian Brim (11:36.75)
yeah.

Jon Morgan (11:37.128)
So it's really hard getting in the door and getting a name, making a name for yourself, getting established because it's such a closely guarded relationship based industry. But once you get in the door and you make a name for yourself, and there's so much out there in terms of opportunities. So that's the rival story in a nutshell.

Christian Brim (11:57.464)
Well, that's awesome. That's a great story. I want to go back to when you were six months in and you decided I can't do everything. I'm going to focus on video production. Why was that?

Why did you pick video predictor? Okay, fair enough. That was where you thought you had a strength.

Jon Morgan (12:13.734)
I just wasn't good at the other stuff.

I mean, like I was, I was pretty good. I was pretty good at designing a logo. was pretty good at making a brochure. But if I wanted to really be sustainable, I, I knew that video was what I was best at what I enjoyed the most and where I saw the most potential, because the other like marketing agencies were my biggest competition at the time. And so they did everything but video. And so was like, man, maybe I should just do video then and not compete with them on all these other things. and then realized that.

Now I can become a production company and begin that journey.

Christian Brim (12:52.75)
Okay, so my next question is you talked about this inflection point where you realized that you weren't good at everything again as far as videography and you said, okay, I'm gonna bring in people that are better than I am and I'm gonna lean into what I'm good at. What did you lean into as you were delegating? Like what did you identify was?

the most valuable thing or most important thing that you kept on your plate. the second question is, did you have any mental hurdle with that delegation, bringing in others and letting them do the work?

Jon Morgan (13:39.272)
sure.

The short answer to that is the one position I couldn't outsource was sales and being the business.

Christian Brim (13:48.844)
Yeah. Yeah.

Jon Morgan (13:50.514)
So I could hire a director, I could hire an editor, I could hire a shooter, I could hire a gaffer, I could hire all these other positions in my creative production, the creative production, video production process. But the one that I couldn't hire was bringing in the projects and managing the business. And so that's when I realized that I needed to focus on that side of the business and let everyone else do the other sides of the business just to survive.

I mean, that's the truth and that's the honest answer is just if I didn't sell and I didn't bring things in, no one else was going to and I go out of business and I find another job. So, you know, I learned real quick that you got to sell to be able to eat. And so that's when I started working with some more like business consultants and coaches just to learn how to sell and learn how to stay in business and price things. And because that's a whole nother angle of the creative industry and the creative businesses, the real business side of it.

Christian Brim (14:20.437)
Mm-hmm.

Jon Morgan (14:49.724)
So that was my role that I focused on and really grew on, grew in, was the sales and the business role. And then to your second part of that question about, you know, was it hard or mental challenges? Yeah, I mean, it was hard initially because I'm a control freak and I'm a perfectionist. And so I thought that I can do it best. But the nice thing about hiring people that are more talented than you is that they are better than you.

So it didn't take long for the people that I was bringing in to the projects to exceed my level of talent. And I was like, man, holy cow, this is awesome. This is way better than I could have ever done. So then it became a lot easier to let go of once your talent, the level of talent increases beyond your capabilities, then it's one of those things where it becomes easier to let go and you're like, oh man, this is awesome.

Christian Brim (15:41.006)
Did you start out with independent contractors on this or did you hire employees or how did that look?

Jon Morgan (15:51.24)
Hiring has always been one of the biggest challenges of my small business. And really, think any small business hiring is always challenging. So of course, I made a lot of mistakes with hiring earlier on, thinking I needed to bring people on too quick and thinking that that was going to be a good idea. Some ways it wasn't with bad intentions, but it was just a struggle because I didn't have a consistent revenue model.

Christian Brim (16:05.998)
Hmm.

Jon Morgan (16:21.104)
And so when you're just project based and you don't can't really forecast, you don't know what's coming in and when it's coming in, it's, hard to be able to grow. It's hard to be able to hire people and make payroll when you don't know when the next project's coming from. so that was a challenge early on. so that left me only being able to work with freelance people because I didn't have to pay them in between projects. I just paid them when I had to work. And so,

That's and that's still today the model that I have stuck with Primarily certainly on the production and the post-production side and so as things have grown in the sports world The level of talent that I've been able to bring into our work and our job projects Far exceeds what I would be able to realistically afford in house and so it but there are challenges with that as well So you know the in-house model is a lot more cost-effective in a lot of senses, but then it

Christian Brim (16:57.902)
Mm-hmm.

Jon Morgan (17:19.334)
that comes with other challenges too. So there's trade-offs for sure between doing the in-house model versus the freelance model.

Christian Brim (17:29.57)
Yeah, and I like, I heard this phrase a long time ago, but I think it's a brilliant anecdote of hire slow and fire fast. You know, we, in our business, you know, doing those projections and expectations of growth, bring on employees and then the work doesn't show up. And then of course that just, you know, kills your profitability. So.

Jon Morgan (17:41.128)
Mm-hmm.

Christian Brim (17:58.21)
And you don't want to hire people to fire them. mean, that, sucks. So, but then, you know, so, so waiting until you absolutely can't do it to hire somebody, and I'm talking about an employee, not a, not a contractor. but then the second part of that is, is as soon as you know that you didn't make a right hire, you get rid of them quickly because that's the other thing is people tend to think that.

People are going to change and they're going to get better and you know, it's it's all going to work out eventually but usually that's not the case so high higher slow fire fast How did you you talked about project work and I know that a lot of creatives Do project work and that's their primary revenue model How did you? Navigate those challenges or how do you navigate?

challenges.

The inconsistent cashflow, I guess, is what I'm getting at.

Jon Morgan (18:59.142)
It's always, yeah, it's, it's always a challenge to navigate it. and I will say this was a big motivation for me to get in the sports world, because there was a lot more year round opportunity. And so certainly on the team side of the industry, sports are going all year round. And so when one season ends, one season is starting. so.

It made, as I was really analyzing and kind of dissecting the market within sports, I was like, okay, we've got the professional teams market here that are all year round. We've got the same seasons with college teams that also have these needs. Then, uh, so that, that lends to a lot of, uh, recurring revenue throughout the year. So we don't necessarily work with the same teams every year. Some we do. Uh,

But the more experience we have, the more demand that goes up for us. with our sports being an interesting industry where it's like, it's so niche, I don't have a lot of competition. Like there's not a lot of companies who do what I do, but the companies who are out there who do what I do, like it's very competitive. And so it's not like when a big major team wants to make a hype video, like they're not casting that net to every production company in the country.

Christian Brim (20:13.506)
Mm-hmm.

Christian Brim (20:23.214)
Right.

Jon Morgan (20:23.954)
they're sending it to four of us and say, okay, you guys put together your ideas and your budget. then we, you know, if they want to work with us and then they'll move forward. So the competition is low. The market is big. The recurring revenue is also big. And the demand is there because you can't have the same content. Like one of the biggest challenges in the corporate video world is you do an awesome video, whether it be small or big, you know, for whatever company.

And more than likely, they don't need another video for three to five years. Okay. And so then you have to maintain that relationship and you hope they come back in three to five years. whereas with sports, there's a much higher burn rate on that content because of the nature of the content. So players get traded, they get injured, get fans need to see new content all the time. So there's no way in the world they could use the same video for multiple seasons. Okay. So.

Christian Brim (20:57.08)
Right.

Christian Brim (21:12.236)
Right.

Jon Morgan (21:22.822)
having a built-in consistent need for our service within this market just made a ton of sense to make it easier from a business standpoint. So now we're at the point where, again, we're not working with the same team every single year, but the chances of us working with, let's say two to three teams out of each league goes up every year. So that really helps with the more consistent cashflow.

Christian Brim (21:47.245)
Right.

Jon Morgan (21:52.22)
than just doing the project, doing everything project-based and trying to replace that revenue with inconsistency.

Christian Brim (22:02.862)
I would assume that most of these larger organizations have in-house video. Is that accurate? Okay.

Jon Morgan (22:14.46)
Yeah. I mean, every, every team does there. There's no team that doesn't have some level of an in-house creative team. So, if they are small minor league team, they probably have one, maybe two video people. You know, if you're the, think the, was at a conference this earlier this fall, and the LA chargers were there. And think they have like a 40 person team from a content standpoint. Okay.

So you get both ends of the spectrum from super small to super big and somewhere in between. And so the reason why there's still a market for what we do though is because we represent capabilities that their in-house people can't, they can't achieve on their own. Okay. From a quality standpoint, from a experience standpoint, but also from a bandwidth standpoint. So these in-house teams, are so overrun with content needs.

dropping a huge media day production on them in addition to all of their other content needs is very difficult for them to be able to produce. And then even if they had the bandwidth to produce it, the average person, excuse me, the average hire for these teams is a younger creative that doesn't have a lot of professional experience. So.

Christian Brim (23:33.366)
Right.

Jon Morgan (23:33.926)
They've got a good reel. They've got some good editing skills and some good shooting skills. And then they take them in house. But when it comes to being able to do big set designs, achieve bigger production value content with lighting designs and all of that, like that's so far out of their wheelhouse, they couldn't even attempt to try to do that on their own. So it's all about what we represent to them from a value standpoint of like, Hey, let us focus on this because you're in our team can't do it.

let your announce team do this stuff over here that we wouldn't be a good fit for and then it's typically a good match.

Christian Brim (24:08.824)
So how do you approach pricing? You mentioned it. I'm sure it has changed over your tenure. Let's just talk about how you do pricing or maybe what some of the challenges of pricing are.

Jon Morgan (24:28.744)
Sure. Well, this is one of the biggest areas that the business has grown and I've grown is learning how to price stuff. Because when you're first starting out or earlier in the business, you have no idea. You're just victim to imposter syndrome. you heard that this company charged $5,000 for this project. You heard this company charged $10,000 for that project. So then that's how much I should be charging. But I quickly learned that that's the worst way to price your work.

is just based on what you hear other people are charging because you have no idea if you're making any money or not. when, when now how we approach pricing is most of the time, in the sports world, the client comes to us with a budget. So they may come to us and say, Hey, we've got 150,000, you know, for this media day production. Here's what we're looking to do. Here's some ideas, here's our concepts for they may not have anything at all. And we've got to come up with the ideas and the concepts of pitch those.

within that budget range. So most times, eight, nine times out of 10, we're given that budget upfront by the client. And then it's just, okay, backing everything else around that to say, okay, for us to stay under this, you know, 150 in this example, here's what that would look like. So then we just have to come up with the concepts and price those out accordingly to stay under that top number. So we have to look at all of our crew costs, all of our rentals costs, all of our post-production costs.

All of those other costs are just line itemed out in our bids so that we know what to expect. so when earlier, probably five years ago, before I got a little bit more sophisticated with it, I tried to bake in like markup into the rates. And it just got, it just got complicated to try to put in a rate in your spreadsheet and then remember what your actual costs were in there.

and then figure out what the leftover was. I brought about three years ago, I totally just went away from that model. And I, I started adopting what was in the hiring commercial production industry was called the AICP bid format. Okay. So that's association of independent commercial producers or productions or something like that. Anyway, it's an advertising commercial industry standard way of bidding.

Christian Brim (26:48.802)
Right.

Jon Morgan (26:52.208)
And so basically I took that model and then I modified it for my needs. And so how it works now is in our platform, budgeting platform saturation, we have every line item cost, you know, detailed out. so every line item in there, VP, AC editor, motion graphics, whatever, we list out what our hard costs are. So if I've got to pay this director 20 grand, that goes in the line item, 20 grand. And then at the end of all of the line item.

Christian Brim (27:14.731)
Mm-hmm.

Jon Morgan (27:21.832)
there's the production fee is what basically is our markup. Okay. And so then our production fee starts at 35 % of certain line items within this whole list. so then basically, what that comes out to is basically is 35 % on everything but travel. So we pass travel along at cost and then everything else, the markup gets applied. And then that way, I know, okay, here's our production fee, here's our markup, and then here's our hard cost and then

It's just a much easier way to predict what your costs are going to be. And then once the client awards and things go forward, then it's just on us to manage that budget and make sure that we're not going over.

Christian Brim (27:59.266)
Right.

Christian Brim (28:02.698)
Do you have issues? Well, let me, my original question I was gonna ask is have you ever, I think I know the answer to this, walked away from a bid proposal because it was not like there's no way I'm gonna make money on this or not enough money.

Jon Morgan (28:24.712)
Yeah. Yeah. mean, and that's part of what I feel like we as business owners have to be transparent about is, hey, is this a good fit or is it not a good fit? Because I'm not in the business to try to do business with everybody. I'm in the business to try to do business with people who are a good fit. Okay. And so I would say it's fairly rare that we have to like totally walk away. give you an example of what just happened yesterday.

where some high school tennis coach emailed me wanting a video for his tennis team. And know, high school teams are not known for having much money. And so I just said, hey, you know, I'm more than happy to talk to you and see if, you know, if I can be a resource somehow. If we end up not being a good fit, then I got another buddy over here who's a much smaller, you know, more independent guy who can probably be a better resource for you.

Christian Brim (29:04.386)
Right.

Jon Morgan (29:22.44)
And then that's ended up what I did. So, I'm always trying to qualify as much as I can on the front end of like, Hey, you know, if the team reaches out and like, Hey, what can we do for 10 grand, you know, or something, not insulting that budget level. Like every everybody's different, but if they're expecting like what we do for our major productions on a 10 grand level, it's like, I wish I could, like, there's so many people I want to help, but it's just like, it's just not possible with my model. And so I always just try to.

Christian Brim (29:37.506)
Right.

Christian Brim (29:47.384)
Right.

Jon Morgan (29:52.487)
to someone who I think would be a better fit and focus on who is a good fit.

Christian Brim (29:58.53)
I think that's one of the things that is key to success in a creative business is having an expectation of profitability and sticking with it. And being able to say no to something and walk away from it is hard, especially if the alternative or the replacement is not clear and it's not, you know, imminent. you're like, well,

I got to take this because I got nothing else in the pipeline, you know, kind of, kind of thinking.

Jon Morgan (30:30.024)
Sure. Which is always a temptation and it's always a pressure, you know, it can be, but I would say we just have to be careful about managing expectations and setting expectations because we've all been in a position to take a dive on the profitability to get the job. Okay. But what if that client comes back the next year?

Christian Brim (30:40.92)
Mm-hmm.

Jon Morgan (30:59.912)
What are they going to expect? If you did a $50,000 production for 25,000 because you really, really, really wanted it and you made it work, you made no money, everyone else gave you friends and family cut rates and all of that. Like if you pulled it off somehow for 25K, even though you should have charged 50, what do think that client is going to do next year? Well, they're going to expect you to do the same thing for 50K or 25K. And so

Christian Brim (31:01.709)
Yeah.

Christian Brim (31:26.124)
Yeah.

Jon Morgan (31:27.58)
Kind of one of my sayings is cheap work leads to more cheap work.

Christian Brim (31:31.084)
Yes. How do you absolutely well and it's a hamster wheel you never get off it. You're right. I think a lot of creatives struggle with pricing because, you know, absent experience of someone saying, yeah, I'll pay you this. There's there's that fear factor of, you know, that creeps in and is like, well, am I worth it?

Jon Morgan (31:32.754)
It does.

Christian Brim (32:01.152)
Right. You have a situation where now you have people coming to you with budgets. How did you handle that before when you were coming up with the bid and and like how was that different?

Jon Morgan (32:20.168)
Most of the time it was the game of fishing. You're just throwing your line out there and hoping that it's going to bite. You're throwing out numbers. When you have no idea how much the client has. Believe me, I made more mistakes than I can count earlier on in managing those expectations in those conversations. One of my mentors earlier on still talked to you.

But he runs the design and branding agency. so he and I kind of became close a long time ago as I was just trying to learn business. so he's one of the best things I learned from him was how to handle some of those conversations when it comes to pricing and budgets, because he said in his conversations with clients, he'll say, Hey, do you have a specific budget? Most of the time they say no.

And then most of the time they say, okay, and then they come back with a number and you have no idea if that person has that amount of money or not. And more times than not, they don't. Okay. So this is one of his best piece of advice to me was don't walk away from that conversation without talking about a number. And so if the client doesn't give you that number, you need to give them the number and say, Hey, uh, you know, based on this scope,

Christian Brim (33:23.619)
Right.

Christian Brim (33:36.951)
Yes.

Jon Morgan (33:41.384)
some past projects that we've done like this. Typically, these are in the 10 to $15,000 range. Does that sound like it'd be a good fit? And see what they say. And then you shut up. And the first person who talks loses, okay? And then you'll get to know real quick what their real number is by their reaction. And they'll say, you know, that's about what we expected or, you know, we think that that could work. We're, oh my gosh, we're thinking this would be like $5,000. Well.

Christian Brim (33:50.423)
Right.

Christian Brim (33:55.661)
Yes.

Christian Brim (34:10.221)
Right.

Jon Morgan (34:11.036)
then why don't you just tell me you had $5,000 and I asked you and you said you didn't know. Okay. So you always exactly there. And even if they don't know, there's always a number that makes them uncomfortable. So go after the uncomfortable number, say, look, you know, this is going to be about five to 10,000. You know, does that sound doable to you? You know, and if they say, yeah, then great. What next steps, what I'll do is I'll put together initial scope of work for this or whatever else they're asking for. You know, we'll, send this over.

Christian Brim (34:15.264)
Right. They do know. They do know.

Jon Morgan (34:39.368)
And then I'll, you know, we'll set up a time, uh, with the next week to kind of talk through that and make sure that there aren't any questions or concerns as you know, we move forward, you know, something like that. Uh, so that's the, one of the best ways that I learned earlier on to manage those budget conversations, just to see if you're in the same universe, because I spent so much time meeting with people, talking with people, driving all over the city for coffees, you know, meeting with all kinds of business owners, you know, not knowing if they had $500 or if they had $500,000 and

it's one of the riskiest things that you can do is take all these discovery calls and conversations and do zero qualifying on the budget and then send them a proposal and just hope and pray that they're not going to freak out over it.

Christian Brim (35:21.186)
Yeah, that's really good advice. I think part of the problem, not necessarily where you are now, but looking at the landscape as a whole, part of the problem is businesses don't really know what they're buying or why they're buying it. I think there's a lot of people that get pitched, say video production.

And they don't really know why, you know, it's like, well, you know, the guy I play golf with, he, he, you know, got video done, or I see this, competitor on LinkedIn and they're all over the place with video. And so I'm like, well, I need video. And without really understanding why that, what they're going to do with that from a business standpoint, how much, how much return on investment or what their expectation is. so, yeah, they,

I think there's a lot of buyers out there that don't really have, they don't have a sense of the value because they don't know what it, what it is that they're buying or why they're buying it.

Jon Morgan (36:28.914)
Right. No, I totally, totally agree. And, and honestly that it's been a, one of the biggest blessings to not have to worry about that in the sports world. Like everyone already has informed expectations. Everyone already has an idea of what they're buying and what the purpose is of it. I don't have to navigate some of that, you some of those difficult conversations to try to sell them on like why they need video. like I used to do. So,

Christian Brim (36:39.149)
Yeah.

Jon Morgan (36:58.374)
Yeah, I think it's it's there's different types of like sales conversations and there's different types of projects. So like sometimes they're very specific projects where you don't really have to talk about value or what's this going to do for you, you know, where it's like, hey, we need a training video to show it our orientation for this, you know, company. Okay, pretty straightforward. Is a price going to work? Is the concept going to work? All right, let's do it. You know, those are pretty straightforward conversations. But if you're trying to

Christian Brim (37:17.666)
Right.

Jon Morgan (37:26.684)
like sell them on the value of a brand video or a commercial, you know, or something like that. Like that's a whole nother can of worms where, you're, you're, you're essentially trying to sell creative goals and aspirations to someone who's likely not creative. And so, that can be very, very challenging. And then some video gurus, you know, they kind of are advocates of this like value-based pricing model. Okay.

Christian Brim (37:30.264)
Right.

Jon Morgan (37:55.506)
Whereas like, how much value would this video create for you? You know, if it, if it doubled your revenue, like how much value would that create for you? Like I never got into that. Okay. Like I'm more of a straightforward guy and I try to be real consistent with how we manage pricing. So whether this video generates a billion dollars for you, or whether it does nothing for you, it doesn't change my costs. Okay. So, I've always tried to be more straightforward and there's plenty of guys who disagree with this. So.

It's kind of a hot topic issue, but I've always tried to be more straightforward with it and be like, look, here's what it costs. Here's what you're asking for. And is it a good fit or is it not a good fit? And so I try to peel the onion back as much as I can. And certainly now in the sports world, we send over line item bids almost every single time. And then the client can see exactly where every single dollar is going, including our production fee, including the production fee. They will see exactly what our production fee is on this whole thing. They'll see where every dollar goes.

And 9.9 times out of 10, get zero questions on it.

Christian Brim (38:58.257)
Yeah. Yeah. And I do think it depends on the situation. I unfortunately am one of those proponents of value pricing that you were disparaging earlier. we'll talk about that on a different episode. the reality is as long as you're getting your margin, it doesn't really matter how you get there. The more important thing is are you making the money you need to? And that's the piece that I think

Jon Morgan (39:07.879)
Hahaha

Christian Brim (39:27.892)
a lot of people skip over. last question is kind of a pivot. What are your thoughts? What's the impact that all of the new AI tools have had on your business? What do you see in the near future? No one can tell me the long-term future. What would you see, say, next two years?

Jon Morgan (39:53.448)
Sure. Well, I was just talking to a couple different people about this in some conversations the last couple of days. And the analogy I like to use is that AI is a tool. And just like anything, tools have specific jobs and you don't use the same tool on every job. So if you're building a house, you don't use the saw on every single job. Use the saw when the saw is needed. You use this tool for when that tool is needed.

Christian Brim (40:07.651)
Mm-hmm.

Jon Morgan (40:22.46)
So I think AI is nothing more than a tool and it's used for a lot of jobs, but it's not used for every job. And so there's ways that we've certainly have embraced it to make our efficiencies, know, workflows more efficient. And it certainly has extended a lot of capabilities that previously we were more limited on. So for example, like we'll use them in our pitch, we'll use AI and ChatGBT and several of the other programs like in our pitch processes. So when we're trying to come up with some custom imagery,

uh, for a concept. Previously, you would just search the internet and the interwebs and find mood board images and grab from other existing content out there to try to paint the picture of your idea. Well, with AI and ChachiBT, now you can create a lot more realistic looking custom imagery for exactly what you want instead of having to grab from other content out there that might be close, but not exact. Okay. Um, it might help us. It helps us write copy.

for some decks and stuff like that. So we use it in our sales processes. And then we've also used it in our post-production workloads as well. So we had a project with NC State Basketball this past fall where they wanted to create this kind of stranger things, upside down world type of look for the concept. so previously we would have approached that more from a traditional VFX approach.

with 3D modeling and VFX and all those programs. But that gets very costly very quickly. And so with AI, we were able to feed it some of the clients drone footage of the stadium and around the city and then feed that into AI. then it was able to create that effect for us in a matter of prompts.

Christian Brim (42:15.819)
Right.

Jon Morgan (42:16.86)
There's a lot of efficiencies that is created. It's also extended our creative capabilities where we can do a lot more with a lot less now. previously we would have been more limited by budgets when it comes to VFX and CGI and some of those things. Now they're a lot more accessible. So we can push the creative boundaries a lot more than what we previously were. So it's a great tool. It's not the right tool for every job.

Christian Brim (42:37.72)
Right.

Jon Morgan (42:46.312)
you know, am I worried about it taking my job? No. You know, so I also think that eventually there's going to be kind of a pendulum swing with this as most things, uh, you know, most innovations and things that come out. Okay. There's an early adoption, super popular. Everyone wants it. And then it kind of teeters off and then it comes back to the other way. Okay. So I think that there's going be a lot of, you know, frenzy to early adopt AI and all the things that it can do, but long-term.

I think that it's going to come back the other way where it's not going to be so commonplace. It's not going be so overused because I think our society is just going to become immune and just numb to all the AI, some people call it AI slop out there.

Christian Brim (43:35.756)
That's a good term. No, I agree. I was talking to a content writer yesterday as a contract content writing company. And, you know, he, he was talking about the need for human written content versus AI written content. And, you know, he actually bought a, a, existing business,

Jon Morgan (43:41.96)
you

Christian Brim (44:04.468)
not even a year ago. So he knew that AI was a huge factor, but he was betting on the idea that the human content was going to eventually be in more demand. And I think he's right. I like your analogy of tools because I just thought of this and it may be a bad analogy, but we'll go with it and see what you think.

Let's say, you know, there are hand saws, right? Okay. And then all of a sudden, somebody invents an electric circular saw, right? And now it doesn't cost much more. Maybe it's cheaper than the hand saw. And so you get a lot of people who are like, this is great. I'm going to...

Jon Morgan (44:52.466)
right.

Christian Brim (44:58.478)
buy a circular saw and stop using my hand saw. But the problem is, is for the average person, it doesn't make any difference in their productivity, in their results. If they're a woodworker like I'm a woodworker, it's not going to, it might allow me to do some things faster, but not necessarily better. And at the end of the day, as me,

you know, the do it yourself or it doesn't really move the needle. It sounds sexy. And it is it's impressive. Like look what this can do compared to. But but if you take it to the hands of a professional, the professional builder, for instance, they're like, shit, this cuts my my cost down by nine, my time down by 90%. I absolutely am going to love this.

But I guess what I'm saying is, to continue the analogy, it doesn't make someone a videographer. It doesn't make somebody a copywriter. It doesn't make somebody an accountant. It's going to find its real value in the hands of the professionals, not in the DIY.

Jon Morgan (46:20.024)
Yeah, I think that there's a lot of truth to that because ultimately AI can only do what you prompted. And so it doesn't know everything. so it's a lot of its ability to do whatever we want is in the hands of the prompters and the people. And so we still are going to need people in order to use that tool. But again, I don't think it's going to totally replace everything. Another good example of this in my industry, in my world,

Christian Brim (46:27.096)
Correct.

Jon Morgan (46:49.544)
was LED walls. So LED walls were all the rage about five years ago, where certainly in sports, they were the new technology, everyone wanted them, virtual production, you know, it was like this new sexy thing. It had so many benefits. You know, you could shoot anywhere, you could shoot in the studio and make it look like anywhere. just, there were so many bells and whistles and selling points about it. Okay. And then teams started adopting the LED walls.

Christian Brim (46:53.496)
Mm-hmm.

Jon Morgan (47:19.176)
In all of their videos and all of their content because they saw the efficiencies we can get so many different looks out of this one wall. We can put this background in this background We can do all of these things and so it was all the rage, know five starting about five years ago and Then rode the wave for I would say the next couple of years was right super eye-to-man Well in the last year to two years now, we're already seeing it come back down the other side where it's a tool but it's not a tool for every job and so more teams are starting to

not want LED anymore because it's already been so overused. They have to, they have to do something different. and so that only benefits me because we're there to help them do something different, but bring this back to this point about the technology. Like I think AI is going to follow a similar trend where there's going to be an, kind of an early adoption craze of like, okay, let's see how we can do this, and, and use it in all of our content. But then inevitably there's going to have to be a shift.

Christian Brim (47:53.74)
Right.

Jon Morgan (48:18.363)
to where more fans are going to want other types of content that doesn't look like AI. So the bar is always changing, the trends are always changing. So that's where I would be reluctant to be like a huge investor in AI, or at least for my industry right now, because I think it's going to be popular for a time. And to some degree, there will be long-term uses and benefits for it. But the...

Christian Brim (48:18.413)
Yes.

Jon Morgan (48:46.084)
ultra high level consumption and use of it in like all applications, I think is going to be very limited. And so I think at some point it's just going to taper off and just be, you know, it's a tool, like I said, but it's not necessarily a tool for every job.

Christian Brim (49:02.37)
John, I very much appreciate you coming on the show and sharing your experience. If at the off chance that there is an NFL video producer listening to the program, how would they find Rival Studios and learn more?

Jon Morgan (49:05.992)
Sure, absolutely.

Jon Morgan (49:13.832)
Not just NFL, we work in all sports, know, rival studios.com is the best place to check out our work. My contact information is on the contact page. So always happy to be resource to people, however it can be those who are kind of aspires and dreamers of getting into sports or, maybe there's people out there who want to potentially work with us in that particular capacity, shooters, editors, whatever. So we're always looking to grow our talent pool of people that we can pull into projects.

But always happy to be a researcher where it can be even on the business side too if people have got questions on kind of maybe learning some of the lessons that I learned without the pain. Happy to share those.

Christian Brim (49:52.622)
Yes. Thank you, John. Listeners will have those links in the show notes. If you like what you've heard, please rate the podcast, share the podcast, subscribe to the podcast. If you don't like what you've heard, shoot us a message. Tell us what you'd like to hear and I'll get rid of John. Until then, ta-ta for now.

Jon Morgan (50:11.464)
Thank you.