by Duane Conder; Friday, July 2, 2010
Conder Media Group, Inc (CMGI) was incorporated in Texas in 1995. The business was built on providing turnkey production services to broadcast, corporate, educational clientele.
Since 1995, we've sent out slightly over 1000 invoices totaling around $2M.
On June 24, 2010, I applied for a full company dissolution and closed the books on July 1, 2010.
We have also discontinued the use of the dba CondorMedia™, the associated logo and www.condormedia.com as well.
Full BK proceedings will be ongoing throughout 2010, most likely finishing up by year's end.
Some key events occurred in 2010 that left me no alternative but to make these decisions. In the interest of transparency and education, I'll give the hardcore facts, lessons learned and where we go from here. I'll also try to stay as objective as possible, but by the nature of offering explanations and lessons learned, some subjectivity will be infused.
The Economy-Related Key Events:
• A ~$300k project that was to last for some 24 months was canceled in early 2010Clearly, the lesson here: have contracts with a hefty, enforceable cancellation clause; market yourself even when you're busy; and DON'T USE CREDIT TO FLOAT GEAR (beyond 60 days). More on this later.
• A $100k project was canceled
• A $30k project was canceled
• Marketing for other work was not possible and did not occur during furious pre-production/production on these projects
• Our corporate credit APRs went from 2% (2009) to 24% (2010); much of the outstanding balance was from equipment purchases for these projects
What's more...
Confusing Marketing:
When we re-designed the logo in 1998, I opted for "CondorMedia" as a dba and "look" since "Conder Media Group, Inc. was just too corporatey and simply had too many letters to brand in a cool way. And for the web, I went with www.condormedia.com as the primary domain.The lesson: Don't confuse people, ever, in anything you do. You will regret it no matter how cool it seems at the time.
For 12 years I have had to explain to people why my last name ends in "er" but for the company it is "Condor". Not just occasionally, either. Literally, EVERY NEW CLIENT and NEW PERSON I MET inquired about this, some more than once. It got old.
This probably never hurt the business. It was just more of a frustration. Now there's an opportunity to start anew.
The Volatile Use of Credit:
Businesses run on corporate credit. Very few operate on a cash basis. So in the case of a media production company, gear purchases most likely will happen using corporate (or consumer) credit. Some gear is cheap. Most is not. You usually need great gear to get superior results: Great = Expensive. Traditionally, owning your gear was much more lucrative in the long run than renting. What's more, there was (and still is) a prestige associated with the owner/operator.
Once computer technology was infused into our production tools, the rate at which cheaper, better, faster gear increased tenfold. That's good for the creative; can be good for business... but dangerous because:The take away here: At the rate that technology is causing our tools to depreciate at a constantly increasing rate, never float equipment purchases on corporate credit past the 60 day mark. If the billable for that specific widget isn't covered by the job at hand, payable by the client in 30 days (most go 60), then rent. Simple as that.
a) new gear (albeit cheaper & better) must be secured more often to stay competitive and current;
b) the billable rates for this new gear have plummeted; and
c) the old gear is mostly devalued long before full ROI is realized
Couple these things with "outdated" gear floating on credit and you have a real mess. Add to this the fact that the banks can do what they want, when they want, with your account(s) and the rates (even with the new regulations).
The logical argument then is to rent the gear from a trusted rental house or colleague. In some cases this is a viable and affordable alternative. But at a certain point and for certain projects, there's a drastic point of diminishing returns.
For most of our projects, for instance, renting was rarely a good option. By the way, when we did rent, one of the best rental houses I had the pleasure of working with, Dalsa Digital in LA, quietly closed it's doors in 2009 because of these exact same tough issues.
Moving on:
On June 23, 2010, I secured the name: DCONDER.LLC. This will be a leaner, more efficient operation run on the lessons learned over the past 15 years and specifically the events and lessons of 2009 - 2010.
Although mission, vision and values statements will be forthcoming, here's the first look at how things will be different:
• more of a media consultancy than solely a media services provider, although we will still provide these below-the-line services when neededThere's more detail to be hashed out, these are just some initial, yet well thought-out thoughts. Subsequent posts in this blog will be much more subjective and will focus on moving forward with occasional musings about the past... always with education and transparency in mind.
• faith-based
• much less reliant on HW/SW technology and equipage
• much less reliant on the banks
• more above-the-line work (producer, writer, director)
If you have comments or questions, please post them in this forum and I'll reply here so we all can benefit.
Thanks!
I, for one, will support the new, improved and synchronymically named company, because Duane Conder is the #1, best, most spectacular, artistic, and superb camera/director/lighting/ music guy in America! Sorry to hear of the issues, but you will come back better and stronger than ever. Many people are being affected by the same economic dynamic, but I urge each and every one of them, whether they are EVPs of a Fortune 500 company or just a lowly Governor or Senator, to help the global economy and raise the general aesthetic level of this world by hiring the inimitable (and indomitable) Duane Conder.
ReplyDeleteThis was very courageous of you Duane to be so transparent about your dealings with "Corporate America" and also for lack of a better term "Content Purchasers." Being a composer I can completely empathize with your struggles because the exact conditions you've experienced I am currently experiencing some of them on my own. The only addendum I'd like to make your blog is that don't be afraid to turn down a job or gig that does not or will not either A) conform to your terms or B) be willing to compromise in a way that is beneficial to both parties success and.... to make sure it is buttoned up in a signed contract. Life is too short to work on an unstable project. It causes stress, grief, and an unhappy living environment. I've found that it always works out where either the party I've said no to, comes back around to work with me, and if they don't then you've probably will have saved yourself a lot of trouble. I know many people will say that turning down a gig is a terrible idea, but working on an unstable project under an uncertain outcome is worse.
ReplyDeleteNot sure what kind of "out" clauses you've used as part of your master services agreement or your statements of work, but you might want to include addendums that state if any investments are made that are necessary to support the project that might be considered out of scope or critical to the success of the project, they would be responsible for covering that cost should the project be cancelled after acquiring said equipment. An exhibit B addendum might include the details of the equipment to be purchased, requiring signature approval from the client to acquire the necessary tools to complete the work. Additionally, include in the master services agreement that should the project be cancelled, the cancellation fee would be reimbursement of any expenses incurred prior to cancellation, plus 20% of the project estimate per the SOW. The last thing I would do is if the project estimate is above a certain amount, require a 60 day written notice of cancellation. But you may want to do that for any projects, just so you have time to close out anything and it prevents you from continuing to incur expenses. Also note that work would cease immediately upon receipt of the cancellation, and any tangible files created would be returned to the client, however, would be accompanied br copyrights by DConder, Inc. and thus entitled to residuals if used in any capacity, whether online or offline, or use fees. Also invoices should be paid net 30 days from issuance. Just some ideas to CYA.
ReplyDeleteWell, it doesn't take a long read to be overwhelmed by your candor. I will always believe you are the most talented of the bunch. You pushed me and the envelope in many positive directions. And I cherish the memories of our trips to Neenah and, I think, Alabama! As well as, of course, for Southwest in Houston and Dallas.
ReplyDeleteAnd, you know, I am just about to head down the same path, doing my own thing after so, so many years. Your experience is very helpful!
Many thanks, my friend.
Mark
D. Mark Schumann, ABC
Past Chair, International Association of Business Communicators (IABC)
Accredited Business Communicator, IABC
Thanks for posting this Duane. As someone still new to this business, your honesty is much appreciated and very useful. Best of luck with the new business strategy and I hope to work with you again sometime.
ReplyDeleteMatt Toplikar
Outstanding post Duane... I like how you laid out the hardcore facts. I'm sure it helped provided closure to many questions that may have arisen as a result of your decisions during that time. I do agree, that transparency can and does lend credibility. It helps others to truly understand who you are and what you're about.
ReplyDelete