Episode 165: Show Notes
Today on the show we have Lauren Goldstein of Golden Key Partnership. Lauren has been an entrepreneur for over six years and helps businesses with consulting, training and web design. In this episode, you are going to hear about two of Lauren’s crazy client stories when she ended up having to fire them. This is not an easy conversation to have, especially when you can end up in a little bit of legal hoo-ha, as was the case with Lauren!
When a partnership is no longer working and expectations are no longer being met, firing a client is no easy conversation to have. We want to help you avoid these tricky situations and so today we’re talking about questions you should ask your clients in the vetting process, how to weed out the “bad” clients and only work with the dreamiest of unicorns, as Lauren calls them. We’re also talking about the importance of setting expectations and boundaries, how to say “no” and value your business and yourself as a woman.
Oh Crap, You’re Fired! An Introduction to Lauren’s Stories
Firing people you’re working with – clients you are working for and who are helping you pay the bills – is not something anybody wants to have to do, ever! So, what happens when it is just not working and you have to go down that route? And more importantly, how do you make sure you don’t repeat those mistakes and take on another “bad” client in the future? This can be an icky conversation and Lauren is here to have it with us! You might be wondering how Lauren became such an “expert” on this topic. The truth is, this has only happened to Lauren twice in the past six years. Both happened in 2017, but it really sucked when it did happen. She learned a lot in the process. Lauren went through a bit of restructuring of her business in 2017 and with that, it always takes getting a feel for which clients are going to match your new direction.
Lauren’s First Fire: Hear the Story of Parting Ways
The first fire was a client who thought they were further along in their business than they actually were. Although Lauren does work with startups, she needs clients to know where they are in their own business in order to get them to the next level. This particular client did not quite grasp how the entrepreneurial landscape worked and didn’t know how to leverage the tools Lauren was giving her. This was tough for Lauren but she decided to part ways with the client since neither of them were winning. This is difficult to do sometimes. Especially as women, we often take things personally. But Lauren is a sharpshooter and doesn’t like to bullshit and had to do what was best for them both.
Lauren’s Second Fire: Hear the Story of Parting Ways
The second client Lauren had to fire was someone who wanted a website built. Lauren kept asking the client for stuff – images of products, text to explain her services, a mission statement etc. Really, just the basics. The client said to Lauren, “I don’t understand why you can’t do this?” Lauren was like, “Are you kidding me? I have no idea what your business actually does.” It was clear to Lauren then that this relationship was not working. She had to get attorneys to draft papers involved and she ate the other half of the contract price. That one really hurt for Lauren as the client said some really hurtful things! But that’s the lesson she learned; it has to be a good fit for you and the client! Part of knowing if it’s a good fit is to set expectations from the get-go and of course, watch their behavior...
Why It’s Not all about Questions but about Behavior
The good news is there are some questions to ask and things to do before someone becomes a client that will help you avoid nasty fall-outs. For Lauren, all of her clients have to go through a consultation which is generally an hour long process where she asks them some tough questions. At the end of the day, as a consultant, Lauren can help you run your business but she cannot run your business for you. There is still a lot of responsibility that falls on her clients. First off, she makes her clients set a date themselves for a consultation. Setting the expectation. If they fail to set that date, it’s usually a sign that it’s not going to work out. For Lauren, it’s not always about questions, it’s about behavior. For example, she had one client who kept missing their appointments and not bothering to re-schedule or notify her if he couldn’t make it. This was a red flag for Lauren and she had to go with her gut and say no to this client.
Raise the Caliber of Your Clients to Raise the Caliber of Your Business
In the beginning of her business, Lauren would often bend over backward for people who just didn’t respect her time and when she stopped doing that, she stopped getting crappy clients. Lauren decided to raise the bar with her clients about six months ago, in order to raise the caliber of her business. In order to do that, she had to stop being okay with bullshit. When you have a client that drags you down, they drag everybody down. After some trust is established, Lauren’s clients go through a contract which outlines the scope and timeline etc. As women, it’s about owning the fact that your business has value and if you lower that bar, bad things happen! If you keep bending over backward for crap clients, you are going to continue to get crap clients. So employ those tests from the very beginning in order to help you evaluate those clients and if they are going to work for you.
The Fear Of Saying No To A Client
There is often a big fear of saying “no” to a client. If you say no, will there be other business coming in? But the reality is for everything you say yes to, you have to say no to something else. It’s okay to be picky and because Lauren only takes on six good clients per quarter, she has more referrals and a lot more leads. But at the same time, we do understand the stress involved when you are first starting out in your business. You have bills to pay and kids to feed and the anxiety is real! But you cannot let anxiety run your business. How does Lauren reassure us you will have a lineup of people who will want to pay you if you’re so selective with your clients? Her advice is you just have to do it. It might just take 30 seconds of insane bravery to do it, to say no. But in the long run, it’s worth it.
Lauren’s dad gave her some advice she cherishes when she was starting out. He said, “Kid, the thing about entrepreneurship is you’re either drowning in debt or you’re drowning in clients and there is no in between.” So set that expectation for yourself; in the beginning, it is going to suck. In the beginning, to mitigate saying no, you are going to have to have some sort of safety net. Lauren advises that you don’t quit your day job until your business is paying your bills. Don’t put yourself in a desperate situation because that is what is going to hurt your business. The truth is, we underestimate the amount of time it is going to take and overestimate the amount of money we are going to make. So slow down, take your time, work hard and start your business off on the right foot. Don’t be in such a hurry, honey!
SWOT Analysis And The 90-Day Plan Instead Of The 5-Year Plan
Lauren’s background was actually in the medical field. She worked as a pediatrician in pediatric neurology. That was her plan – lab coats and happily married by the time she was thirty. The point is, none of that happened. So five years from now, especially with how fast technology is changing, is a moving target for her. This is why she prefers to set 90-day goals, rather than 5-year goals. Lauren believes setting goals so far in advance can become detrimental because there are just so many factors you cannot account for. To help her clients plan, Lauren does a SWOT (Successes, Weaknesses, Opportunities, Threats) analysis with them. She also does a SWOT analysis at the end of every year for her business. She always sends out a post-project survey because you can learn so much from your past clients. The most important questions she asks in this survey are, “Would you recommend me and my products / services to your friends or colleagues?” If the answer is no, you would want to know that, right? You can learn way more from critiques than the glowing recommendations, so go ahead and ask for them!
Who Is Your Unicorn? Envisioning Your Ideal Client
Lauren urges us to ask, “On your perfect day in your business, who is your unicorn? What does your perfect client look like?” She wants us to ask “How do they communicate, what do they do, what does their business look like?” If you can get crystal clear on the type of client you want to attract, you will attract those unicorns toward you. If you do have a client that is going sideways, Lauren puts essentially this in all of her contracts, “The success of this product depends on how you show up and implement these strategies that I’m giving you. If something is off, I ask for upfront communication so we can fix it.” It’s important to set expectations from the get-go. If things really do go way off the rails, then look for a win-win for everybody because nobody wants to feel like they failed. So find a way to make a graceful exit from the contract. Another way to set those expectations is to state on your website / sales page who your product or service is not a good fit for, to minimize chances of disappointment. Any way you can weed out the clients who you don’t want to work with can save you a lot of time, energy and help move your business forward.
How To Fire Someone... In A Nice Way
Obviously, it is not ideal to have to fire someone. So, this is really the last option after you have tried to make it work. If it does get the point of firing, Lauren’s conversation goes a little something like this: “We came into this with these expectations, here’s the part that I’ve done, here’s the part I feel we’re not connecting on. Do you feel like we can work through this? Or would you rather we part ways?” This is how Lauren lays it out for them: “If we part ways you’re not getting the money you paid for because I’ve already put my time in… So here’s what we can do to complete this project and here’s what we can do to part ways.” In Lauren’s case with her last client, the client very clearly did not want to continue with her, so she wrote up a severance agreement in which she placed a non-defamation clause. This saves both parties and ensures that things don’t get messy and the process is as gracious as possible.
- Oh Crap, You’re Fired! An Introduction To Lauren’s Stories. [0:03:20.1]
- Lauren’s First Fire: Hear The Story of Parting Ways. [0:04:43.1]
- Lauren’s Second Fire: Hear The Story of Parting Ways. [0:06:40.1]
- Why It’s Not All About Questions But About Behavior. [0:09:10.1]
- Raise The Calibre of Your Clients To Raise The Calibre of Your Business. [0:13:30.1]
- SWOT Analysis And The 90-Day Instead Of The 5-Year Plan. [0:31:22.1]
- Who Is Your Unicorn? Envisioning Your Ideal Client. [0:34:45.1]
- How To Fire Someone... In A Nice Way. [0:42:00.1]
- Get crystal clear on who you want to work with.
- Set boundaries and expectations with your clients.
- Tell your clients that you’re not available 24/7, on-call!