Andrew: Hey there, freedom fighters. My name is Andrew Warner. I’m the founder of Mixergy, where I interview entrepreneurs about how they built their businesses for an audience of entrepreneurs. I didn’t even realize that I knew today’s guests business. Cause I, I had no idea. He was one of the co-founders. He is the guy behind creative live, which for me, I should introduce him.
These Craig Swanson, for me, your business in many ways was, uh, ah, they’re doing it better than I I’m doing it. And that’s the model I should have done or was doing. And wasn’t doing as well.
here’s the thing I started Mixergy, not because I wanted to do interviews. I started Mixergy because I wanna do online education. I felt that only entrepreneurs could teach entrepreneurs. Meanwhile, there were all these knuckleheads who knew how to write great books, who were getting a ton of attention for teaching entrepreneurs, how to build businesses when they’ve never freaking done one.
And I said, okay, if I could work with these entrepreneurs, I could have them teach a thing that they’re specially good at. I started out with interviews and my model was to move towards that. And I eventually did. I added master classes, which we made into a, a premium product. Then I watched from the sidelines, I guess, maybe not from the sidelines I watched from my peripheral vision.
This company called creative live launch and build up. And what creative live did was they said, we’re not focusing on entrepreneurs. We’re working with creatives. These are people who are good at using Photoshop. Good at taking photos and. Kind of the model that I was going after for recruiting, they were offering their programs for free, right?
If you watched it live, which meant that there was a big incentive for people to register, to watch live. And then if you didn’t watch it live, or if you wanted a recording of it, either way, you got to pay to get the recording. And the instructor got a percentage and the program creative live kept the rest.
That’s the model. Craig is nodding Craig. I had no fricking idea. You were there because chase is such a, he’s like a one name, uh, personality in this space. He is the guy who created the phrase. The best camera is the one in your pocket or the one that’s closest. How did he phrase it?
Craig: The the best camera is The one you have with you.
Andrew: The right. Exactly.
It’s been so popular that it’s been butchered and I’ve heard it a million different ways and credited to different people or to like the universal. They did this. So they said. Anyway. I had no idea. You’re the guy behind the guy. I checked you out on the site. You’re there. And for some reason I never knew that it was there.
Meanwhile, though the business blew up in a good way, then I thought it blew up in a bad way and disappeared. And today I find out that it was acquired by five. I invited, Craig on here, not knowing all this, but now that I do, I wanna know what happened there. And I wanna know how he’s helping online personalities build their businesses.
And frankly, from a personal point of view, I wanna understand what I could be doing better How big did creative live get
Craig: um, so creative live well, I guess that actually is an interesting number you’re asking about, like, are you
asking about How many, how big was
the audience, how big was the employee?
Andrew: at its height. What was
the revenue? Let’s talk dollar. I’d rather talk profits, but once you took, uh, funding, I felt
like profits become less significant. So let’s talk revenue.
Craig: I know really intimately the revenue, um, while I was running content and basically responsible for it.
So we were doing about 14 million a year, um, about midway, about, uh, about 2014, 2015 after funding, um, later on down the road, um, those after we had opened up the
San Francisco
office,
so my monthly, my monthly target
was a million
dollars in revenue a
Andrew: You were hitting it, the San Francisco office I I’d heard a lot about it. I think I was even in that space, it was, it was a place to work and also a place to bring in authors and other creatives to have them teach live. The thing that you did beautifully was you elevated the platform.
You made it look good. So people were proud to
be on it. whose, uh, part was that you chase?
Craig: I I definitely think that is
probably both of us. Um, so first of all, making the platform look good, elevating the platform that is chase, chase drove, the aesthetics, drove, drove the quality of the photography. Um, I was very much focused on the audience engagement and creating the space that instructors could feel seen and could see both the people in front of them and also the virtual audience that was watching.
So, I mean, if I were gonna, I would, I would give equal credit on both sides of that. I was building kind of the systems that allowed everything to connect and chase was really focused on the aesthetic, the, the, the feel of it, um, and, and creating that, that really warm opening space that had like a beautiful kitchen, beautiful area that basically people wanted to come and hang out in.
Chase is cool. I’m not cool.
Andrew: The thing is that you also would have like these robotic cameras, you had a live audience,
that whole thing. That was you figuring out how to make it No, that’s chase, right.
Craig: Again, it is a mix, but I would say the live
audience is really kind of the core of what I was driving from the beginning. So the, the, the idea of creative live was incubated in my it company that I was running in Seattle at the time chase was a client. I, I, I, I basically was an it company for about 20 years supporting local ad agencies, design firms, and creative studios.
So my entire career has been being the support structure for creatives. And, um, I was developing inside of that, a online education platform, but I was really unhappy with the way instructors and I felt when we were teaching on that platform. Cause we were talking to a microphone, we were all alone. We were not giving her a good performance.
And I started to create this mix where we had a live audience that was in person, just like you have at the, the tonight show or any other TV sh you know, live record TV show. And we are broadcasting simultaneously. And that whole
energy was what I was really
focused on.
Andrew: let, let’s go back to the beginning. When you were doing
this
Craig: Yeah.
Andrew: as an agency, what were you doing for
your clients?
Craig: Um, it, so if, um, so for example, uh, creative agencies, design firms, they have different needs on a lot of companies. They have, they have really big servers. They have a lot of different needs, but they’re often Mac based. They have a lot of file, uh, file asset management. So we were specialists in that, um, Costco’s in-house creative department, pretty much any fortune 500 in the Seattle area that an in-house creative department was a
client of ours.
Um, we worked with most ad
agencies in the area.
Andrew: And so then how do you make the transition from
that to saying, I want to have online
video.
Craig: Well, for me, the whole reason I worked with creatives is because I wanted to be in film. When I started, I I’m a very technical guy. I’m really, I’m really attracted to technology. Um, and, uh, effectively, that’s the way I, I, I met that need is. Pursued technology, but I surround myself and I only supported artists and I supported commercial artists of photographers, creatives, and that’s
all I
worked with.
Andrew: Okay. I see. And so you said I’m gonna help you do online video better
or was it well, take me to the transition that became creative live the online education platform.
Craig: So really that was more of a hobby of mine.
I had always been playing with online education.
So I had always been playing with education. I, I love teaching. I love being around teaching. And so, um, when my company got to the place that I had the freedom, because the employees were largely running it and I had, I had the freedom, I invested in my own little, uh, training company.
I hired a full-time trainer who was excellent, Jason Hoppe. Um, and we spent about two years basically playing with different ways of trying ways of, of creating education. We were trying to like do 15 minute increments. We were playing with things. We were doing it online and all these things were different experiments.
We were running and we kind of narrowed in on this idea of S
casting, a broadcast to the world while teaching it to a local audience. And at the time I think we were using zoom then, but, but zoom
was not what zoom is today. um,
Andrew: but you were using webinar software meeting software
to broadcast, live to people. Were you charging for that or was that free from the beginning?
Craig: from the very beginning. Well, I guess I, I should actually back out a little bit. It makes it sound a little bit more organized and planned than it was. I loved the training company, but the training company was not making any money. Um, and there’s around 2008, 2009, when the economy tanked and we reached a place where my it company could not support a, do nothing executive that also had like this a hundred thousand dollars a year training hobby.
And I was doing all my Excel spreadsheets. I was trying to figure out like what I’m gonna do. Cause I didn’t wanna give it up. It was what I loved, but it was not making money. And I remember one weekend just like pouring over the numbers, like figuring out like what I, what I could do with ads, how I could like try to like make this all work.
And every time I came out, basically we were netting zero at the end and I just said, screw it. Let’s just give it away for free at least, you know, like I, I figured we’re just gonna do one last blow. Do a free course, as many people as we can to show up and, um, and then shut it down. I, I basically, I wanted to go out with a bang, um, and we did a free 10 week Photoshop course.
We, I had a 30,000 person email list at the time. And then at the time chase was had shit here. Did chase. I dunno if chase blasted out to his audience, I don’t, I don’t think he blasted out to his audience at that point. Um, but we got enough uptick and takeout for this that we, first of all, found out that zoom only supports a thousand people at a time.
I had thought that was just a marketing number. I thought that the 1000 person limit was just a, a number that marketing put on to make it look real, but no, it actually blocked out. And so we, we maxed out our zone feed. Uh, we are doing it free. We let people buy a copy of the class after the fact, which is basically the business model that creative live like, like iterated on.
And in that 10 week course we made $35,000 compared to probably a third of that in the entire previous year of this kind of hobby
training business.
Andrew: Wow. Wow. And this was still just you doing it as a side project to
creative text your it business.
It did have a, did it have a name at the time?
Craig: It was creative text. It was just creative
text training.
Andrew: okay. I see it by
the
Craig: Um,
Andrew: are so freaking understated. I’m sorry to interrupt, but you’re
so freaking understated. Even on your LinkedIn bio, where you talk about creative texts, you don’t give yourself a title. It it’s
just small business owner.
Craig: um, you know what? I could work on that. Although I was a small business owner, see the thing is I didn’t, I didn’t call myself an entrepreneur until creative life because I, my, I always wanted to be an entrepreneur, but for me, an entrepreneur was someone who created, grew and then sold businesses. I mean, per someone who just runs one business for 25 years, for me as a
small business owner,
Andrew: Got it. And that’s what you did. You’re 22 years at that business.
According to LinkedIn, starting with, uh, 1980. Did you look great for your age then? I don’t know how the hell you were able to
do this for that
Craig: I started, so I started right outta high school. So I I was one quarter into college and dropped outta
college to
start that company.
Andrew: because what did you see?
It doesn’t seem like there’d be a lot of money
in this.
Craig: Um, because I was, I was a, I was a graphic design major in college.
The technology I had used in high school to publish our high school newspaper was the technology, all graphic designers were starting to use. And it was only 16 months old. There was nobody that knew it better than me. And, um, and apparently I was good.
I was smart and I was good at building trust with people. And I followed through on what I said I was gonna do. I had a couple clients take me under their wing and I just worked it and worked it and worked it and grew until, until I, I had
earned.
Andrew: made money.
Craig: Yeah, exactly.
Andrew: How much did you earn
at a tight.
Craig: So I desperately
wanted to be in
the, uh, the young entrepreneurs club, which is a million for people I think under 40, I think they kept raising the number. I capped out at my it company at $870,000, um, in my final year, um, then I sold it to the employees. It it’s still functioning today. Pretty much every business I’ve touched is still functioning today, which is kind of amazing to me.
Um, my first year in creative live. So I sold it to the employees because we basically spun out that training company, chase came in as a partner, it blew up and, um, we broke the million dollar mark on the first year in creative live. I think I turned 40 that year, so I would’ve been able to get to the young entrepreneurs club
if
I had planned it
properly.
Andrew: You eventually got in it, but wow. First, first year of creative live, you get to a million dollars and it’s all because this model that we just figured out, right. Which is let’s give it away for free. People want the recording. Great. They could buy the recording of it. How did you hook up
with.
Craig: So chase was a client of mine for, I think about a decade, maybe more than a decade. Cause remember I was in Seattle. Chase is in Seattle. I support pretty much every significant designer or creative in the Seattle area. Um, and chase chase had one of the most technically advanced photography studios out there.
Apple was a client. He had a ton
of apple gear
And
we, you know, my
team was the it team that had support in the
back end.
Andrew: Okay. And then you did this online
education. He, And you maybe helped promote it together. At what point did you say this is our business model? We’re gonna go forward with this.
Craig: So there was never a time that we were creative live, that it was not chasing me. So the rebrand and chase coming in and us partnering to build this out, that happened in 2010. Um, and, and, and basically from 2010, it, we were just sprinting. Um, chase lined up three of the biggest names in photography education that he knew.
He basically recruited the first three instructors in photography. Um, and that took our, you know, our, our demo class where we were doing 30 to $40,000 of a 10 week period. Um, we were doing. 60 to 150 million or not million 60 to $150,000 over a three day weekend. And we really built creative live in the initial days around photography and around that concept of a three day workshop, because that’s the way a lot of photography was taught.
And so we would teach these lot streaming classes that were eight hours a day for three days. Um, and at the time there was not a lot of live streaming. I mean, we, the live streaming market didn’t exist the way it exists today. Um, in fact, we weren’t even sure that we could get a big enough picture to be able to teach what we were teaching.
The, some of the innovations that, that we were playing with is lowering the, um, lowering the frame rate in order to be able to get a larger image area. And just trying to
figure out how far
we
could push
the, the, the small little
pipe that we had available for live
Andrew: Because you had to make it look really crisp so that
people can see the details you’re talking about. But at the same time,
people’s connections. Weren’t very good. I remember talking to the founder of Twitch immature. He had a similar issue. People if they made the quality really good people couldn’t see it clearly enough.
It became a real problem. Uh, people couldn’t see the game let’s go back then to
where you are. So the, the next thing I want to know is you could have said, we’re going to teach it ourselves. We don’t need to bring in these professional. Why’d you roll your eyes. When I said that that’s not, that’s a model that you discard quickly. Why, what was it about that model that you didn’t like?
And how did you find the model of bringing them in and
sharing revenue?
Craig: So, and I think this may come a little bit from the fact that I was building it and I don’t, and I was not building it for me. I didn’t roll my eyes as that’s a silly idea, but what I, what I rolled my eyes out, or that response was because as soon as somebody is creating a platform for themselves to teach on, I see that as them creating the ceiling for which that, that, uh, that platform will go to, um, it is very, very rare that somebody will build a platform for them to teach on that they will allow someone to else to outshine them.
And at creative live chase, chase was not teaching and I was not teaching. I was creating a stage to make the person on that stage as big as possible. And we could allow people to come in and shine as bright as possible without having any sense that they were taking a place that I wanted to be.
And so we were able to really create this opportunity for as many people.
And, and it became a
place that just talking to speakers, like it became a, a phrase,
have you done your creative
live yet? There was a, there was this
sense of accomplishment of having
gotten onto that stage.
And in part it was because there wasn’t a
secondary person you’re trying to get into. We weren’t
like the Oprah show where like there was, there was
Oprah. That
was basically like
the, the, the, placeholder. We
had the person on the stage. They
introduced themselves generally. And like,
they held that stage for themselves and we made it as warm and welcoming as big for them as we possibly could.
Andrew: Because from the beginning, you
said we are, it’s not about teaching and making
all the money for ourselves. It’s about creating a plan to share revenue with them. Naturally, we should not go in and, and take center stage and so on.
Craig: Exactly. And, um, I mean, to be honest, we tried to, you know, we tried to work as the best deal we could for revenue for ourselves, but that really came down to creating something where they were also pushing as hard as they could. Um, when creative live started, we had no audience. We, we had, we had the 30 PE 30,000 people on my list.
We had, we had Chase’s audience. Um, but we didn’t, we weren’t had a big audience. We brought on big name after big name. They poured their audience into us as aggressively as they could, because they were creating something that they shared equity ownership in,
um, that they were creating. They were, they were
going to like
benefit and
profit from that, from
that weekend event, based on how big it was.
And it wasn’t until about a year later that creative life started having its own audience because we had had
really significant name after significant name, come in and
pour
their audience into us
Andrew: So the way it would work is you’d have an author or someone who was known creatively. come
and teach. They would come to your studio from the beginning. It was in your studio and record in
person, right?
They would come
in, they would promote it to their audience and say, Hey, I’m going to be on creative live.
It’s this beautiful platform. And I remember them being elevated by it and, and owning that sense of elevation. Like, look at me, I’m gonna be at this beautiful place. They would tell their audience to come watch live. Their audience would have to register to see them live. And as a result, your mailing list grew.
And then you’d say, Hey, this is live. You’d email that out to the list. People would come live and then you would do the follow up sales. They wouldn’t even have to sell all they were doing was saying, I’m offering this for free, right? If they wanted to, they could sell. But I don’t think they even had to, and many didn’t even do the sales part.
They would just say it’s free and let you be the people to sell.
Craig: exactly.
And even beyond that, uh, or in the early days up until the first couple years we would do about six weeks of reach out to their audience ahead of time
for
the people that were actually be in the
room with them, we would actually have
people submit videos to audition,
to be the audience in the room.
And in order to submit those videos, they had to do it publicly on Twitter. So we actually created this buzz
with a competition for just to select the audience, to
be there in
Andrew: I had no idea, no wonder these people were talking to me about how they were in the audience. I
thought
it was just like, Hey, I bought tickets to this show.
No, it was them saying I won. Wow. And I totally missed that
part of
it.
Um, alright. That’ss pretty, pretty fricking impressive. What was your share, uh, situation?
What was the split between you and the, uh, the instructors.
Craig: So in general, um, in general, we started out kind of philosophically with a 50, 50 split and then would, would carve out some space for production costs and other things. And so over time, I, over time, the first year of instructors got a better deal probably than, than later instructors. Cause they were more instrumental in making creative life into what it
was.
And, and then
creative life eventually had its own audience
that was able to negotiate a
better deal, but it was a
at
the,
In
the early years, it was a substantial portion. Um,
because
we were doing a lot, we were investing
30 to $40,000 on each,
on
each, on each event.
And we were trying to make it a
blockbuster in the process,
Andrew: 30 to $40,000 in production.
In what, where did that money go?
Craig: Um, well, in the early days, since we didn’t have everything built out there, there were a lot of things that we were placed with capital with capital capital capital investments later. So the studio became a lot better. Um, things got less expensive as we built out, invested more in the studio.
So we were doing a lot of offsite, uh, leasing of spaces, one of the things. So if you’re not all that aware of the early days, the one thing that really put us on the map of the photography space, we hosted an online wedding course in 2011, 2010, 2010, where we had brides and grooms submit
videos to be
the
couple that are
married on screen.
And then
we
produced and paid
for a
full wedding for those people so that our wedding photographer could teach a five day course leading up to the live wedding
where she shot it live.
Andrew: You know what, that’s the thing that I
admired most about your
company
creative live. It was that over
the top at a
time
when
people were very impressed, if they could expecting very little right. That they would even chat to the instructor and the instructor would respond back.
take that to like the Hollywood levels with your production. There were moving cameras. There was a design sense. There was the sense that when I think chase, did he have his own interview show that was
part of creative live or was that still
off on his own? It was part of
Craig: It was something he started separately. So he, he had his
own live persona and live, um, program
that
he then did
bring into
Andrew: Remember I’d interviewed Jason fried and done some, some really good interviews with him and he posted them on his site, but it was a different experience. When the founder of base camp, Jason tweeted out and talked about his creative live experience. It was, I want you to see where I was. I am worthy of being on this stage is the way most people handled it.
You’re smiling. Cuz you, you recognize that
that was intentional.
Craig: yeah, it was intentional and it was aspirational. So, and, and I would say the aspirations were on slightly different areas. Um, for me, I wanted, because we also worked with the instructors leading in. So we would, we would do a lot of producing and prepping and work with them cuz they’re gonna be live for three days and we try to give, we cannot carry the ball for them, but we tried to give them as much support as we possibly could.
And especially in the world of photography, we are bringing in, you know, we’re, we’re sourcing models and locations and setting everything up. So there’s, there’s an entire production happening, separate from the production we’re filming because we are gonna film the production that we’re putting in front of the camera.
Um, and also it is for, for instructors. I wanted to be their
high point.
In their professional career, we did not
always hit that. And
as we got bigger names, it became harder. But my
personal goal was for everybody to experience their high point career moment at creative live at the point that they were giving
Andrew: I could, I saw that for authors. I remember because you were in San
Francisco
when an author would be on or creative teacher would be on your platform. They would be in San Francisco They. Was there. And so they would come out for dinner or scotch at my office and it was a point of pride and a little bit of nervousness.
Did they create their own courses or did you do production for
them?
Craig: They, they had to have the expertise. And generally we were not putting people on the stage that were not already teaching elsewhere. So we, we basically looked for people that were really good at teaching in groups or had done some, we weren’t, weren’t really looking for
people who taught online. We
were looking for people that were really good
at teaching in
larger groups and they were doing, they, they had a really hungry audience. We could be a multiplier of that, a significant
multiplier of.
Andrew: All right. You were
asking me about my sponsor send in blue. Do you know about them or do
you want me, what do you know about them?
Craig: well, so act, first of all, I was really curious about the name. So because send and blue makes me think of like the iPhone and the blue is always
like the better way of connecting with people. And I
believe they have SMS and
I am running a small group entrepreneurs group
in
Seattle, and I realize I need a better way of being able to communicate with these people.
And I don’t know anything about send blue, but they were
on my list. I was told I should look at,
Andrew: that’s interesting. I
think that for a lot of
people,
they don’t come up
because we have a handful
of email marketing companies that we
know, and then that’s what we focus on. And
those
companies are just spending a ton on advertising. I hear one on NPR a lot. Here’s what send
and blue does. They’re a European company, which is partially why we don’t know them, but also because they’re based in Paris, they care a lot about design and feel.
And they’re in a little bit different head space than most of us. When we’re thinking about online marketing, we think about, will they do segmentation and yes, they do. They think about that, but they say, can we make it look right? And not, it doesn’t really cost that much to send out. This big jumble of tech.
And so that’s where they come from. They’re also big on saying, look, email, it costs fractions of pennies, but once a company gets their clause in you, they just keep ratcheting up the price because they know it’s hard to move out, send, and blue says, we’re gonna start out low and then we’ll keep our prices low so that our customers are happy with the way that we’re we’re operating.
And then finally they do more than just email marketing and the segmentation, all that like you surmised from the name, they do text messaging. They also create the landing pages, the opt-in forms, the whole thing all in one in a program that just works and works beautifully. Many people who haven’t heard about them say, well, What’s their staying power.
Can I actually trust them? They’re huge company. Their latest raise actually, it’s been two years now was 160 million in series B. They’re well funded. They are huge, mostly in Europe, but also in the us. And if you’re considering them, I highly recommend signing up using my URL because frankly, I get credit for it.
And I want them to know that this is, uh, working for them, but also they’ll give you a discount. If you start by going over to send in blue.com/mixer G send in blue.com/mixer G. And it’s always, I’m gonna tell everyone else who’s listening. people.
If this isn’t working for you, let me know if it is, let me know. So far, people have been signing up and tell me they’re happy. And so I keep running ads for them, but if it doesn’t ever work out, I wanna be the first person to know. My email address is Andrew mixergy.com. I’m not just reading ads here. I’m talking about companies that I think you should sign up for, and I want you to be happy with them.
Thanks. Send him blue. By the way, look at this space. I feel like I finally am now starting to dress up my, my, my workspace. Are you someone who’s like pretty obsessive about this stuff or is it just, no, I just care about the business side of things.
Let the
designer handle it.
Craig: So I tend to have a very paired down aesthetic desire. I tend to want to execute.
only what we can execute really well. And so basically I will often be basically stripping away things that feel like we are trying to aspirationally hit something we haven’t earned
yet. So,
Andrew: Me an example.
Craig: well,
I mean, in website design or, or logos, or pretty much anything, um, I will often work with creatives that get really big ideas on what they want to do and they’ll end up like filling in with, um, with basically things that we haven’t earned yet with a, with a lot.
And, and we were talking about this a little bit earlier about you saying I’m not, I don’t, I’m not using the best job description for myself. I do tend to understate everything that I do because I want to make sure everything that I do is accurate and like lives up to the promise. And
so I think
that that invades my sense of aesthetic and
everything else.
I, I tend to not try to
make a
fuss about something aesthetically, unless I really know what I want.
I tend to never wanna be performing. I tend to want to strip away any instinct in me that is performing for an outside world or trying to meet goals that other people are setting instead of me.
And so, um, like my aspiration in life is to pursue the
things that are most meaningful for me, even
if
everybody else
on the planet can’t see it and
is not interested it and I’m, and I’m, and I’m getting no one else’s reward. And I’m the only person that I’m serving.
Andrew: Like what take
me to creative live. I wanna get to what you’re doing
today, but take me to creative live And
then help me understand how that played
itself out. What did you want that maybe nobody else wanted.
Craig: Well, I would say with creative life, so with the, the direction of creative life, so creative life for me was always about the audience. Um, so the audience was always what we were creating for and as we started to raise money. And so here, here’s a really great here. Very easy tactical example. Once we started down the VC path, there was a heavy emphasis on positioning the company for the next raise and the energy needed to position the company for the next raise is not always in alignment with the energy, for serving the audience we have, or figuring out how to grow something and earning it.
So we are trying to convince a very small group of people that, uh, they should put a lot of money into us as opposed to a very large number of people that want to buy a small thing from us to change their life. And I would say just as a really fundamental level, my instinct is to go to
the large audience and make a small
impact
on
a lot of people, as
opposed to try to convince a
small group of people of my value.
Andrew: I get that I do too. I like having a large audience. There’s something very
satisfying about that. There’s something.
Um, safe about not having all your eggs with one basket. okay. And still you raised what? Seven and a half million from Greylock,
right? You then didn’t you
raise from Chamath papillas fund.
You raised how
Craig: Yep. Yep. Uh, I think, I think they,
I think they led
with, with
25 million raise in
this in the
Andrew: social CA. So you had a ton. Here’s my understanding that now puts a lot of pressure on you, but also a lot of opportunity. As soon as that happened, it gave you a lot of credibility. I started seeing more ads on Facebook for creative live courses, and then at some point it almost all ground to a halt. My understanding was you weren’t able to raise the next round, which
then put pressure on all expenses,
Craig: so I don’t really, I don’t really want to go into detail about like the, behind the scenes on Ray. Um, but if you read, but if you read the news articles, there was a large layoff at creative life.
And what I can say is there were a lot of choices leading up to that, if we had been focused on
creating a
stable profitable business, we
might have made different choices than if we were
trying to
look good for
Andrew: Okay. All right. I, I think I’ve got a pretty
decent analysis of what it, what happened there. And by that you mean you spent a lot of money to get a lot of customers, so you can prove that there are a lot of people who, who care enough about your product to pay. Got it.
All right. Then you left,
the company was sold afterwards to
fiber. You still
had equity in the business.
Craig: mm-hmm so, so I left the company in 2015 and have been working with, with,
uh, um, with
influencers and celebrities since then fiver acquired,
uh,
creative live. Uh, what’s it, it was either,
it was either
this year,
2022, or was late Last year,
Andrew: last year.
October 7th is the tech crunch article on the.
Craig: Mm-hmm
Andrew: And so did you have equity at the.
time?
Craig: I, I, did.
so I, I was a common shareholder. I, I had, I
had a significant amount of common
shareholders as, as did, uh, any of the employees that had their stock options that they, that, that they paid
for,
or, or had converted previously,
Andrew: My
sense was that was not a big windfall for you.
Craig: uh, to my knowledge
and, and I would know no
equi, no, nothing
went to the common shareholders after the purchase.
Andrew: Isn’t that fricking frustrating?
Craig: I had made my piece with a long term. Honestly, the, the frustration for me
that
the, the area I think is most
painful is for the employees
that invested no stock options, because I, I don’t know how well, you know, stock options, presumably, you
know, like deeply, but when you leave a company, you often have to make a cash payment to that company to hold onto your
stock options.
yeah. And, and I, and there were a lot, and there were people that believed in the company that, that, that paid that money. And just, just based on the circumstances of how everything went down, you know, it was, it was not a bet that paid off. No, they sh everyone should know that, like, you know, I, I treat any stock or equity option as, as a bet that is not likely to pay
off, but you, but, but,
can pay off.
So,
um,
so managing risk, I think
is really important when you’re playing these games.
Andrew: I have the opposite
approach. I treat
it all as a
potential big
payoff, and then I get frustrated when
Craig: Hmm. That is not how I’m wired.
And, and, and part of that is the, is the downplaying. I try to only, I only, I only count what exists and, and part of that was for me in Seattle, probably different areas, but in Seattle, I was in business in the crossover from you. 1999 to two thousands. I, I had tons of creative companies and startups that were clients of mine during the, the first.com bust.
And I had a lot of friends that acted as if they had the net worth that a stock
certificate said they had and when their companies went bust or just were downgraded that evaporated, and they were left with a lot of debts that they,
where they thought they had a lot of assets.
I’m very conservative on, I’m basically keeping my family safe.
And that’s probably the biggest difference is, um, I, my goal is to
make sure that my family
is taken care of over the, over
the length of their lives. And so until I hit that
mark,
I don’t see
anything as free money for me.
Andrew: And do you
keep your money? What in cash? Do you keep
it in S and P.
Craig: Um, I tend to, so I keep, I keep most of it. So most
of my cash? is in stock. So, so In in, in mutual funds. So like I have, I have a, you know, a firm that manages that. Um, but I tend to keep this, this actually there there’s, there’s a, I, this actually is a really good example for me. So when I left creative live, I started my own little kind of mini venture firm, which is where, where I was basically investing in companies and becoming business partners and putting my, my effort into helping grow them.
So, so I was not investing a lot of money, but I was investing a lot of time. And when I left creative live, I set aside. Not much, $250,000 for basically a series of bets on my next thing. And rather viewing that as one, $250,000 bet on my next thing, I viewed it as five $50,000 bets on my next five things.
And I put a lot of effort into trying to create systems where I validate opportunities as opposed to letting my emotions and belief like run away with me because I do believe I’m a believer. I don’t, I don’t put my energy into something I don’t love and believe in, but I don’t believe that just because I love it and believe in it.
That it’s true. So I really look for creating proof in the market that my emotions are based on something
Andrew: my sense was you left creative live because you
and chase had creative differences
Craig: Yeah, I think that’s fair. I mean,
and also the direction that creative life was going was working. I’m not just because we had different visions didn’t necessarily mean mine was right.
and when chase
became CEO,
I, I started my, my, my segue out
because yeah, like creative life
was gonna go, where was gonna go, where it was gonna go.
Andrew: All right. Take me through the way that you were thinking about businesses. What kind of businesses
did you wanna
make those smaller investments into?
Craig: So for me, I was really fascinated. So first of all, everything I’ve done has largely been the same business model repeated over and over again, since since 2010, I have worked with content creators and educators, and in some fashion we’ve used a mix of teaching, creating digital goods and a mix of free and paid to create as much value in the world as we can.
Um, one of the things I was really fascinated with creative live was the edges. How big could one brand become in creative life? Like, like. Could we take one instructor. And if we weren’t just focusing on that instructor as one of many, how big a platform could we build around one person? Um, and that was really one of the things that I wanted to experiment with is basically how big could we go if we were just focused on one content creator and just really gave them as much room as possible.
And, um, in 2000, and in 2016, I became partners along with, with two X creative live employees with Sue Bryce. And that was my, probably my first big play outside of creative live. Um, so that was an
online photography
platform that Sue had
started about, about a
year earlier. Um,
and we came in as basically the operational
side to just really supercharge it.
Andrew: She already had her brand name. She already had
her content online and she was selling
online education
portraits. the
portrait system is what I see on your LinkedIn profile. She called it.
Craig: so she was actually one of the top instructors at creative life. So she was one of the top instructors at creative life from 2012 to about 2014. Um, she ended up in 2015, creating her own platform separate from creative life, which is, which was some something we started to see at CRA life is basically other, in other, other influencers, instructors were starting to create their own platforms and, and realizing that they might be able to like get to market a different way.
Um, and so she made a break with creative life, and then when I left creative live, she and I were talking and she basically invited me and George and Erin in to be her partners at super education. And we basically poured ourselves into that company from 2016 and it was just sold, uh, last year. Uh, it was just acquired by, um, by a trade show company,
Andrew: How
Craig: let’s see, what, what, what is
so eight.
Eight. So, so
super low
Andrew: Okay. And then what was your share of that?
Craig: my share that generally, um, in that case, uh,
we had three partners on my side. So in, in my case I was about a 20% stakeholder in that. So she, she was 50% generally we do, we roughly do 50 50 deals with
creators. Um, and then, uh, and
then my
partners, we basically split
the, uh,
the, the other
Andrew: Okay.
And so you partner up with her knowing that she can deliver the goods. What do you add? Talk me, walk me, through what you did for her, because it feels like that’s the model
of what you do with creatives that you work with now.
Craig: I mean, the first thing is we did a lot of work. She had basically built out a real, a scaffolding of a website, but it was having problems. She was having problems with like the daily production. She wasn’t doing anything live. And we came in and started basically building out a weekly live delivery system for her.
She, she would do a weekly Sue Bryce live. Um, she, she didn’t really enjoy selling herself. So the audience that she had sold to up to that point really knew her, but she was doing basically nothing to market or to sell. And so we came in and basically started building sales systems, started building a team, uh, got a studio and pretty much allowed her to focus on being an extraordinary creative in front of the studio.
In front of the camera. And did, did the financial, did the business management, did the marketing, did the Facebook advertising,
did the, um,
the video production, the website development, all that in the back end
to basically make the
systems run?
Andrew: whole like funnel of taking content, that’s
free adding layers onto it via email, and then offering a paid product that was all you
And then you say to her,
can you get on
camera
record? This here’s what we need
for this landing page. And she does all that.
Craig: Yes. Yes. It’s a, it’s a conversation, basically. She is the
visionary. She’s the visionary of the company. She is basically setting a big picture of what she wants to her mission from a education and community standpoint. And. She doesn’t necessarily have the skills to manage higher or want to run a team.
And it’s also really hard to look at growth when growth may impact you negatively in terms of like some of the emotional stuff. So basically we were a little bit less on the line emotionally, and we’re able to make a lot of choices to grow the business. That would be a little bit less comfortable for someone that is also choosing their own stage at the same time.
Um,
as much as people. So I partner with people that have, that have really built up a name for themselves that, that have a large following, but they also have a very emotional relationship with their audience with themselves. There’s a lot in play. So I work with creatives that. I work with creatives that got where they are because of how good they are creatively, but not necessarily because of their ability to put a team together, to be able to build all the technology, be able to do all the business pieces, to be able to, to be able to view their creative relationship with their audience with a little bit of dis dispassion.
Um, one of the most fundamental things that, um, that comes up in the relationships I have, because most of what I do,
tactically,
a creative could hire and should hire a producer for, or a, a growth marketer.
If they could, If if, they can replace me
with
someone, they can pay a
salary. They should.
Andrew: It is a different party to create this content, to help these people. You have your brain, it’s a different thing to think about, and maybe they could even do it themselves, but it’s a real change from how do I have to stop and think about now, how do I create a
funnel that upsells them and another
product and what software
do I
use in your eyes to get a sense to think about that?
Craig: Well, there’s that, although
honestly, the
tactical stuff for me is just kind of table stakes. I think really what comes down to is more this whole, this whole statement I had earlier about me
not believing my own truth, just because I believe it. And I’m looking to validate that it’s really hard for someone who is out there putting their name on everything, to not believe it a hundred percent, but to run the business.
I think it’s really important to listen to the audience. And it’s really important to
validate whether we’re
heading in the right direction, separate from belief um,
Andrew: give me an example, like tell me how, how that played itself out with
Craig: So for Sue and, and for most,
most of the people that I work with,
they have an experience of a live broadcast or of a conference or of their interaction based on how they feel as the presenter, how they felt on stage, what their emotions were while they’re delivering it. And so they assume that the way they feel is the way the entire world.
and often that is completely the opposite. Like they will come off of something feeling really good about it, and we’re missing some, we’re missing something in the audience. Like the audience wasn’t getting something or they desperately want to create something in their life. They, they, they don’t want to be known as the expert in X.
They want to, um, they, they really wanna follow their passion in a different direction, but it’s not the relationship they’ve built with the audience. And so I’m not saying that. We tell that I, that I tell ’em what to do, but they need someone at an equity partner level to be able to negotiate
with
them where the business is gonna go.
Because if we’re an employee, they can just tell us to go.
away. And then eventually
the employees just start doing what
Andrew: gonna talk about my second
sponsor.
I’d love for you to think about while
I’m doing this. What’s a specific example of something that she would’ve wanted to do that you, because you’re an equity
partner were able to get her
to say, no, let’s switch back. And lemon for people who are listening.
If you’re looking to hire developers, they have phenomenal developers that they will match you with. It’s not like a job board. They are matching you with somebody and making sure that that fit is right. And they make sure that the price is right too. And one of the ways they do it is because they vet their engineers from frankly Eastern Europe and countries where the price of an engineer is lower than it would be in the us lower is certainly than it would be in San Francisco.
Or even now that I’m here in Austin, I see prices are just rising for everything and they let you work with them remotely direct relationship that they set up that they make sure works well. And I know how much they care because I introduced someone from my audience to them and the founder jumped right in to make sure that that person had the right match at the founder level.
Lemon cares about making sure you get the right developers at a great price, which frankly right now is a. Is critical. If you’re looking to sign up with them, you can even get a lower price than everyone else. By going to lemon.io/mixergy lemon.io/mixergy. Look at this I’m on their site. I could actually chat with Kate right now and see what I can get.
See if there’s somebody there available for me. All right, love lemon. Were you able to think of a, about a specific example?
Craig: yeah, there there’s a couple. So I would say even the big picture example is a really practical one. So almost everyone I partner with loves to create. And so, so at Sue Bryce, we’ve talked about this pretty publicly. We ended up allowing our desire to create, to drive our production schedule. So we, we went from, um, we were up to, I mean, I think we were making $6 million a year, uh, in, in top line and our production budgets just started to balloon.
We started to create based on our love of creating as opposed to our audiences need to consume
or what our audience was
interested in. And.
And. for Sue, there was a lot of freedom. She was, she was able to do things she’d never been able to do. And so we poured a lot of money into creating a lot of stuff
that
was really for us and not for
the audience.
Um, and, and ultimately we ended up renegotiating all of our relationships with the business, um, because this is not just soup. I was part of this George Sue part of this, Aaron was part of this. We were all, we all had the luxury, being able to pursue our particular interest because we had such a profitable business.
We were able to pull from and we ended up looking at what the business needed. And we ended up redefining our relationships and saying, basically no partner needed to work in the business more than 10 hours a week. And if we were working more 10 hours a week, we were probably serving our personal needs and not the business’s
needs because
the business was super simple and
it didn’t need that.
It did not
need the volume
of
of
innovation that we could pour into it. And in fact, all that innovation
was causing all these frequent turns that was burning
out, staff, burning up money and not grading value. we rather than innovating around different things, we could teach the audience. There are all these sub-business models that started coming up. So we started printing posing cards and, and shipping these printed posing cards, which were beautiful. We started developing a book that we never actually shipped.
We, um, I think we got a little bit into a apparel. We basically started pursuing all these sub-business opportunities and logically it felt like we were doing something that was business related. Um, but I think what we were really doing on all of our parts was we were pursuing our personal desires for entrepreneurship and creation without necessarily.
Determining what the business needed first. And, um, and so it’s one of the ways that I run my life right now is I have a portfolio of companies as opposed to one company and the companies determine what they need from me and from the creatives in those companies, as opposed to me trying to pour up a hundred percent of my interests into one
company,
um, I generally have three going at one time. So Sorece education was just acquired. Um, I currently have, that was, that was my, that was
my
three. So I, I have, of last
year it was Suce education. Um, I have
a online
fitness company
Andrew: fit is the, KAA. Excuse me. And these are both
based on individual personalities, homemade based on Joel, uh, gamin and KASA fit is based on
KAA, Karen.
Okay. And same model they bring in the audience through online content. Are they
Craig: good. Yeah. Yeah. And, um,
Andrew: Mm-hmm
Craig: so in let’s, let’s look at case, uh, at case in, in that case. Um, so Kesa had an audience of about 800,000 followers on Instagram when she and I met and she, you know, as a personal influencer, she, she was one of the people that, you know, brands were paying her $10,000 a day for posts. And she had had some exposure and experience with creating online digital goods.
Um, but really had not dialed into that. And in fact, um, had kinda like had, had a couple successes, but started to steer away from it. Um, we talked a lot, we talked a lot about values, direction, mission, because I’m very mission oriented. I, and I wanna support people that are mission oriented, cuz basically whoever I partner with their mission is gonna be part of what I’m gonna be responsible for building.
When I came in as a partner with her, we started building out in 2019 around a series of education programs that she had already created. And we built some new ones. Um, and she had a really strong belief of what was gonna sell and we created a series
of tests.
Um, and the
thing that she did not think was gonna
sell was the thing that was that sold.
Like there was this
throwaway little mobility program that, um, we sold for
$19 that she said in
an
interview
later, she
didn’t even
do her hair for the promo. That’s how little she, she
believed in it at the time. Um, but
Andrew: this is the, um, it’s it’s kind of like
the
old Jack Laneer. What’s her name?
Um, uh,
Jane Fonda type wood cell.
Craig: yep. No, it’s not that it’s the type of
workout. So
she, she,
is a badass athlete.
Andrew: training on
her
Instagram. She’s like
punching somebody in the stomach, lot of weights.
Right. And this is simpler. Let’s
just get you moving.
Craig: yeah,
Andrew: it.
Craig: exactly. the
we, we did a series of tests with three products that basically were different levels and we all bet highly on her expensive, like higher end training. And the class that took off was this $19 mobility program that basically helped people feel better in their body and basically deal with mobility and movement issues in their legs.
And we ended up selling, we ended up breaking a million dollars in sales of that $19
Andrew: Wow.
Craig: in less
than a year.
And.
And you, you were talking about audience. So for me, I start with, with, with, with my partner’s existing audience as the seed. So like those 800,000 followers were on Instagram. That was not who we were gonna make our money from.
That is who we were going to learn, who we could serve from. And then basically
we built systems to try to
reach out to exponentially
more using her
Andrew: Got it. You figured out from her audience what works and then you say, okay, now there’s an audience that likes this. Let’s go see if we can find
others outside of her audience. She had to give you a piece of her business. Half of her business, she already had Instagram
already was producing revenue. She had to give you half of that in
exchange for the
belief that
you would
do.
Craig: Yes. Although, although I build a lot of safety
into that. So first of all,
we end up creating an incubator company in the interim where we put in just enough for the education. So I’m not part of her Instagram company. She is still an Instagram influencer. She is still doing all the brand stuff. So what we own together.
Is the, is the digital education platform that we built together, which didn’t exist before we came together.
And so we own that thing together. And then that thing together, we are trying to make as big as possible. And in the first year she could have also removed me at any point. So I created a lot of safety for partners
in that.
Um,
honestly,
if something works, they’re never
gonna get rid of me. If something
Andrew: So why not create a platform like you did with creative live? Like now you’re going back to the thing that you
said. How to limit, which is how do we create an individual person, an individual, a brand, and a product based on an individual person. Why not create the new, the new creative live like a fitness creative live aimed at bringing in all the fitness stars and having them have their beautiful experience that they want to Instagram all day and then give them an ongoing share of the revenue. And then unlike the previous creative live, maybe added it as a subscription. So that, which I think is a new
version of creative live, where it’s subscription.
Why not
go to that
direction? I feel like
maybe you have considered it.
Craig: well, I have considered it. And so the answer for me personally, to some degree is I no longer see one company as the only thing I’m going to do. And so I get to have a number of at bats and a number of different companies at the same time. So, so I am not making one company, my entire bet in what I’m doing.
And the other, the other thing is for both Sue Bryce for Kaiser fit. And then I think with, with, uh, with homemade cooking over time, the first year or two is very often just around that particular person in that particular brand, but in each case for super price and for Kaiser fit, we’ve started to expand out.
So by the, by the time we sold super rice, super Bryce’s company, Sue Bryce was not going with it. We were basically, we had created a platform for other instructors. We had created an entire separate brand
called the portrait masters
in which other instructors taught.
And so we had expanded out And
basically used her platform to start
giving room for other people to be on the platform.
Andrew: with them?
Craig: with KAA fit
mm-hmm
Andrew: do,
Craig: we do, and we do revenue share very
Andrew: based on how many people watch or minutes
Craig: mm-hmm
Andrew: it. And then I saw that you did that on member full, which is a membership platform that’s now
owned by, uh, what’s it called? The, uh,
uh,
Patreon company. Patreon
Yeah. So you can actually measure
individual views
and be
able to
distribute revenue
using the member, the member full platform.
Craig: So you, no. Uh, so first of all,
we only
use member
full to
control
access to memberships for Sue Bryce. So we actually track everything separat. So all of our sites are our, our viewership and tracking is all separate. The other thing for Sue Bryce, Sue Bryce education is a membership platform. And on Sue Bryce education, she was the primary teacher.
We had a separate company called the portrait masters, which was effectively a
photography education platform
for everybody,
but Sue price. And so those
two end up getting built in parallel to each
other.
Andrew: All right. I’m so glad that
you and I got to do this interview. Let me close it out with this. Actually, I, I keep meaning to close it out. Cause we’re now going way longer than we planned.
Give me feedback, Craig, you’re the guy
who knows this
business.
What do you think I should be doing differently with Mixergy?
Craig: well, actually, you know what? I don’t know. I would love to stand for another hour and actually like dig into
that. Because when you talked about your masterclass, I would love to dig into how much you’re making, how you’re making it, where you’re making it. Um, but without, without asking some really invasive questions, I don’t know that I’ve got a really quick,
short, snappy answer.
I think you’re killing it from
the outside,
but I
don’t know.
Andrew: I got burned out last year and stalled and I didn’t realize it. And then this year I finally took time away from almost everything except these interviews, which I can’t get rid of. And I’m trying to think of
what happens next.
And
so.
I wasn’t planning on having a
conversation with you that would kind of spark
things, but we were kind of sparking things in my head, which I’m enjoying.
Craig: yeah. When, so right now, is there something
you can sell that you’re not part of?
Andrew: Oh. That I don’t do
at all. Yes. I’ve done that.
Um, where we brought in a producer to create, to create content.
Craig: Well, I mean, literally like, is there
an equity? So is there a comp, like,
can you
sell your company
Andrew: I,
Craig: and, or, or, or, yeah. And it could go and create value and they they’d have the archives of you, but,
um, um, but you could, step
away
if you wanted to.
Andrew: I think so. I
don’t know that emotionally I could,
that would be the challenge.
I so emotionally
connected in like preserving this
of, of work.
Craig: Mm-hmm I mean, I, I don’t think
we do it
live, but if you would like to, I would love to dig in and like,
like really like
give you an
Andrew: All right.
I’ll follow up. I wish that we
would’ve been able to do it here, but we
are at the end. I got like another guest coming in,
um,
Craig: Mm-hmm
Andrew: All right. I’d love to do it. And then maybe we
can do this, but I I’d be happy
Craig: I would love that we could always record it and decide whether you release it later. Yeah.
Andrew: Okay. All right. I’m down. The best place for people to follow up with you is to just go to
Craig: Uh, Craig swanson.org, Craigswanson.com.
