In today’s episode, I discuss the Coronavirus impact on the speaking business. If you ask any professional speaker who has been in this business for a while and they’ll tell you stories of what it’s like when the economy crashes and suddenly all the speaking gigs dry up. It happened in the USA in 2001 and 2008, in Asia in 1997, and it could happen again with Coronavirus. So how do you ensure that your speaking career can survive when the economy takes a tumble? How can you survive a crash in the speaking business? One way is by becoming what I call an ‘All Weather Keynote Speaker’.
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In today’s episode I discuss the Coronavirus impact on the speaking business. If you ask any professional speaker who has been in this business for a while and they’ll tell you stories of what it’s like when the economy crashes and suddenly all the speaking gigs dry up. It happened in the USA in 2001 and 2008, in Asia in 1997, and it could happen again with Coronavirus. So how do you ensure that your speaking career can survive when the economy takes a tumble? How can you survive a crash in the speaking business? One way is by becoming what I call an ‘All Weather Keynote Speaker’.
In building my own speaking career I wanted to ensure that it could weather any economic season. It was about avoiding the feast to famine that too many speakers experience. To do this I borrowed an idea I first discovered while studying financial strategy for my MBA. It’s called the ‘All Weather Portfolio’.
That strategy was devised by legendary investor Ray Dalio. Dalio is the founder of Bridgewater Associates, the world’s biggest hedge fund with $190billion under management. He has personally given over $750million to philanthropic causes. Dalio first described his ‘All Weather Portfolio’, a diversified asset mix of investments, in Tony Robbins’ book ‘MONEY Masters the Game: 7 Simple Steps to Financial Freedom’ and more recently in his own book called ‘Principles’. Here’s how the ‘All Weather Portfolio’ works and then I’ll describe how it can be applied to building a speaking career that can survive and thrive during any economic climate.
This is what the ‘All Weather Portfolio’ looks like as it relates to investing. It is designed to weather any financial season from bull market to bear market, recession to the booming economy we have today.
The asset allocation of this investment portfolio is as follows:
- 40% long-term bonds
- 30% stocks
- 15% intermediate-term bonds
- 7.5% gold
- 7.5% commodities
You’ll notice three things about this portfolio:
- It minimizes risk by holding a low amount of stocks as they have higher volatility.
- It has a large amount of ‘boring bonds’ what counter the risk of stocks and looks to the long term.
- It does have a certain amount of highly volatile assets like gold and commodities as they do well during periods of high inflation.
OK James, so what does this have to do with the speaking business? Well if you think about it, most professional speakers make the majority of their income from the relatively high risk, high reward activity of giving keynote speeches. A good keynote speaker might earn $30,000 per speech and give 50-100 speeches a year but when an economy crashes two things happen. Firstly companies try to save cash by reducing the number of events, conferences and exhibitions they organize. Secondly that great speaker they previously could make $20k for a speech now has to accept $5k. Classic supply and demand and lots of speakers which plenty of blank white space on their calendars.
It’s usually at times like these that speakers have to suddenly figure out how to generate new revenue streams from online courses, continuity and membership programs, books, consulting and coaching. Online courses, continuity programs and books are all medium to long term plays as they take a while to create and start producing income. Consulting and coaching can generate cash quickly but like speaking can alternate from feast to famine. So what should a smart speaker do?
One strategy I’ve been experimenting with is to think of your time like Ray Dalio thinks about money. This means allocating your time over a range of activities which have different levels of risks, rewards and timelines. If you are a classic speaker, author, coach then how you allocate your time might look something like this:
- 40% Continuity Programs (the equivalent of long-term, low-risk bonds)
- 30% Speaking (the equivalent of high risk stocks)
- 15% Products (books and online courses are the equivalent of intermediate-term bonds)
- 7.5% Consulting & Coaching (the equivalent of highly volatile but often profitable gold)
- 7.5% Other (joint ventures and highly experimental projects are similar to commodities)
Now let’s imagine if you looked to build revenue streams from all five of these categories (continuity, speaking, products, consulting & coaching, other).
When the economy is booming, like it is in the US just now, then you are reaping the rewards for plentiful and highly-paid speaking engagements while at the same time taking that cash and investing it in your long-term, lower-risk categories such as building your membership program or creating that online course.
Then when the economy crashes, as it will inevitably do, you can keep your speaking fees high because you have enough income being generated from continuity programs, royalties and other product sales. Basically the time to fix the roof is when the sun is shining!
I recognize that what I just described is not particularly glamorous. It is however strategic and intended for those speakers who want to have a long-term career and be able to make decisions from a position of power and strength.
So here is what you can you do next to become an ‘All Weather Keynote Speaker’:
- Start investing time in building a membership, continuity or subscription program. It could be a $50 a month continuity program like Michael Hyatt’s Platform University or a higher priced $2000 a month ‘Mastermind.
- Commit to writing every day and publishing at least one online course or book per year. Think of your book as a type of retirement account where you consistently add intellectual property to and then at a certain point start withdrawing cash from.
- Automate the marketing and selling of your speaking programs so you can be more efficient with your time because time is money. That’s what my team and I teach to professional speakers.