Eps 96 - Legal Steps for Scaling Your Business From One-to-One to One-to-Many Transcript

Erin Austin: Hello everyone. This is Erin. Welcome to this month's LinkedIn live. And as you can tell, we're doing a new and exciting format this month. Typically I've done the stream it's called stream yard and it's kind of a one way. I can't see you. And, uh, it's much harder to, Chat and provide comments. So we're trying to zoom.

Um, so it might be a little rough is because I have to admit people as I go along here as well, but welcome. And so, uh, if you are new here, I do these. Every last Wednesday of the month at noon Eastern, and I talk about, uh, topics of interest to people who have expertise based businesses that they want to, uh, scale.

And so, uh, this month we are talking about. Hi, Margie. Uh, we are talking about, um, let me see my view. I don't like the view that I have to change that. There we go. Um, I'm talking about no protection, no leverage. And so basically what I do is I talk for about 20 minutes and then you get to, um, have as much Q and a, as you have the appetite for.

I, I can hang out as long as you like. And, uh, and then with this format, you know, please feel free to also, uh, ask questions as I go along if something comes up. So with that, I'm going to go ahead and get started. So can everyone see my screen

guys along here? If I can see, all right. Can you see my screen? Okay. Yep. Great. And I want the whole, let's see. There we go. That's what I was looking for. All right. So no protection, no leverage. So, uh, as you know, um, I talk about expertise based businesses and scaling them, uh, so that we can decouple our income from our time.

And so. I have a three part framework that I like to talk about, um, audit, protect and leverage. So first we want to make sure that we have all the legal rights that we need to create a scaled offer. So we're asking the question, do I own what I think I own? That's the audit stage. The protect stage is, um, You know, I have these rights.

Am I doing everything I need to do to protect them, to make sure that I am protecting them from being used or reused without your permission. And then when we have those pieces in place, then we're already to leverage. Leverage is where we decouple our income from our time and we turn our ideas. Into scalable and recurring revenue streams.

So, today we are talking mostly about, I mean, they're all very interconnected, but we're focusing mostly on the protect and leverage stages.

 So we have, um, what I'm working on. Still. This is an in process graphic that talks about, you know, the more leveraged we are, the more protections we need. So, um, in the next iteration of this graphic. It will show, you know, when we're at the 1 to 1 services, basically, uh, on leverage for most of us, you know, that would be down here in the middle of the page.

And then we, when we have a 1 to several, um, model where we can help more than 1 person at a time, you know, that's a little bit more leveraged and we would have that, you know, um, bar go up a little bit higher. And then to a fully leveraged model business model, where we have one to many offers, that would be the highest bar.

So we would show that, you know, trend from left lower left hand corner to upper right hand corner more leverage means more protections required. And as we go through these, um, it will be cumulative, um, you know, You know, and that assumes that most of us, as we add leveraged offers, we continue to do the 1 on 1 stuff too.

And so we still need the protections at the 1 on 1 level, but then our other services are additive as we're adding additional revenue models to create a full lease, a full business that has different revenue models to make sure that we have that diversity in our businesses. So, so these would be additive as we go.

Up the leverage. So let's look at the one to one services first. So at if this is where you are at the beginning of your, um, uh, uh, business, you know, and one to one doesn't mean beginning of your business, but if you are at the one to one services level. Level, you need to make sure that you have all of these things pieces in place.

So you should have client agreements, contractor agreements, nondisclosure agreements, also called NDAs and an AI usage policy. So, client agreements. We want to make sure that we have our own templates, but if you, like many of us have corporate clients, we are going to be presented with our corporate clients, uh, you know, template for, you know, vendor agreement or supplier agreement, um, or services agreement that they will have that they ask you to sign and you need to understand what's in those templates.

Because when we want to think about protecting our expertise from being reused without us is that we need to make sure those client agreements have language in there. That 1 that reserves to us our original IP that we're bringing to the table. They're hiring us because we have something that the next consultant doesn't have, and we want to protect that.

We want to make sure we retain the rights in those. So our client agreements need to. Make sure we're reserving rights in our IP to ourselves. And we also need to make sure that the license that we provide to them to use our IP, um, is limited so that they can't create derivatives from it, that they can't resell it or use it with additional cohorts if they've only paid for one cohort.

So that is language that we need, even at the one on one level, having. Language that protects our expertise in our client agreements on the flip side. We also needed in our contractor agreements. If we are using contractors to create, you know, graphics for us to write copy for us. To, uh, design our website to do social media posts for us.

We wanna make sure that we have agreements, written agreements in place with our contractors so that we own all of those deliverables. The default under us copyright law is that the human being who created those deliverables, owns them, doesn't matter that we paid for them, doesn't matter that we told them what we wanted to them to deliver to us.

If we don't have something in writing, then that contractor owns it. So we want from the beginning, uh, to always use our contractor agreements as well. Non disclosure agreements. You know, I think that they're generally overused. I don't think we should share confidential information with anyone that we aren't doing business with.

So. In our client agreements, in our contractor agreements, there will typically be confidentiality provisions in there. But sometimes we have to have that NDA sign ahead of time. Again, when we're working with corporate clients, sometimes just, you know, in order to get on the phone with them to pitch them to find out what they're looking for, they're going to require you to sign an NDA.

And so you need to be able to navigate your way around NDAs. And by the way, I do have resources. Everything talk about is kind of almost like an overview of everything that that I talk about. And I do have resources for all of those. I'm going to do a roundup of everything that has all the resources that apply to all the things I'm talking about today.

So, we need to make sure we have our basic understanding. If you don't have our own form of NDA, that we also understand how to review, um, the client's NDAs. And then finally, the AI usage policy, uh, that applies to all of these, you know, when we have client agreements, the client will expect to own to be able to own and have exclusive use of everything that you deliver.

And so. If you are using AI for client deliverables, you need to make sure that it is not in breach of those client agreements. You need to have a usage policy about creating client deliverables, um, about using AI to create client deliverables with our contractors. Same from the other side. If we don't want our contractors using AI, we need to make sure that we have a policy about when and how contractors can use AI, any disclosure requirements that are required in connection with that.

And with non disclosure agreements. You know, if our client is presenting, providing materials to us to work with, and we are required to keep them confidential if we are feeding them into a I, um, into a I platforms are we breaching those nondisclosure requirements? So we need to have an usage policy up and down, um, for all of our 1 on 1 services.

So that takes us to one to several offers. So now, um, this is not, you know, the courses of the world, but this is where, you know, we are the one, by the way, the one numeral one is us. And then the several or the one or the many is who we are providing value to. And so we can provide value to several. People are entities at the same time by adding this next level of leverage.

And what agreements do we need for that facilitator agreements? Let's say you have been providing personally providing training. And development services to your clients if you want to be able to deliver it to more than 1 kind of time 1 to several, we need to add facilitators. You can use our materials and deliver our workshops, our trainings.

To more than one client at a time. And this is a very particular type of agreement. It's not just another contractor agreement when we have a facilitator, we are letting them use our materials to deliver to our clients. It's a very different relationship, and we want to make sure that we have agreements that.

Specifically address the legal issues that come up with that 1 is making sure that they know they can't use your materials with anybody else. But also, what happens if, you know, they have some ideas for improvements who who owns those, you know, when we use facilitators, they're usually other experts like us, and they might have something valuable to add.

And we want to make sure that the. The ownership is really clear. And the second one, which would be part of your facilitator agreement, but I made it a, a separate one just to point out the importance of it is non solicitation. When we are bringing in other experts to work with our clients, there are some risks.

And we want to make sure, um, uh, that, you know, I don't believe in non competes, by the way, let, let the best woman win. But, but that doesn't mean that you bring in a facilitator, you introduce them, and they develop a relationship with the client, and then they get to walk away with the client. Um, so having non solicitation agreements is an important part of that.

Another way that we do one to several. Is through licenses. So instead of having a facilitator, come in, um, and work with your clients, you license your workshop, your training material directly to your client, and they can use an internal resource to facilitate that. And so those would be licenses and those are again, legal agreements that determine the parameters of how they can use your materials.

And when we get to this stage of facilitators of licenses, that is the time when we really need to make sure that we are codifying and registering our workshops. Uh, our expertise, frankly, into, uh, protected copyrighted materials. And by that, I mean, um, that we are actually put them, putting them in a final form that they are ready for, uh, Registration in the U.

S. Copyright office. Now, if you are, you know, anything like me and most people, you know, when we work 1 on 1 with our clients, we just have, you know, what we know, we've been doing for years, decades, multiple decades, and we may not have it in a nice little package. But when we get to the point where we're using.

3rd party facilitators when we're creating licensed materials for our clients, we have to have them in that final form. And that final form is what we should be registering in the U. S. copyright office. And that gives us additional protections in the event of a breach in the event, the facilitator takes it and does something with it.

In the event, the client takes it and just the fact that it becomes more accessible because, you know, we're all connected by the internet, right? It, maybe it ends up inside of some training data somewhere. So we want to make sure that we have those things registered. And, um, so that we have the additional protections that we get and, um, you know, as I go through this, I think about all the times that I've done linkedin lives about each of the things I'm talking about, actually.

Um, and so, uh, when I do that roundup, it'll, it'll both have links to materials that I have as well as other podcasts and linkedin lives that I've done about each of these topics. And now we have the one too many offer. And so this is when we get to the point, maybe we have an online course, maybe we have a membership group, um, a book, even, you know, something that as some resource that's available, and now we're not doing.

Individually negotiated agreements. The license agreement is now in the form of terms of use, which is what if you ever read terms of use, which I know probably none of you have, there will be a very specific language in there about how you can use the materials on that website. That is a license. The website is the owner's intellectual property and the terms of use dictate how you can use that intellectual property, which is what a license is.

And so when we graduate to the one to many offers, we will start incorporating terms of use. So we aren't negotiating with every single person with access, but they're agreeing to your terms upfront in order to get access. They pay their license fee, subscription fee, membership fee, and they get access to your intellectual property and then trademark registration.

You know, I, I, you know, have a thing about trademarks. I'm not anti trademarks, but when we start to get. To the, um, when we're at the one to many level, it is a little more, the relationship is a little more transactional, you know, when it's the one to one, obviously it's very much relationship based, even in the one to several, it's still relationship based and the trademark, the name recognition in the marketplace.

Isn't that important, but when we get to the one to many, and it becomes more of a transaction, they may not even know you at all. Personally, then the brand becomes more important. And we do want to make sure we're checking that brand with our trademark registration. So. Uh, that is I'm going to return to this to, you know, to put an overview here.

Um, and I would love to, you know, get any questions that you may have about these, um, these different levels of protection as we go up the leverage continuum.

So, say, I, I have a workshop with some, I guess, documents that I pass along and leave them. With with them say, with the attendees of the workshop, like a helper guide for them afterwards. Does that also need to be protected? Yeah, so if you have materials that you're putting in your workshop 1st, let me start here is that we have copyright protection.

For everything that we create that meets the standards for copyright ability. I hate using that term, but that is eligible for copyright protection. So it is original. It was created by human by you. And, uh, well, I know you're an AI person, so make sure it's by you and not by your AI and, um, and that it has a minimum level of creativity.

It can't just be. be, you know, something that's kind of just fact space, but it has at minimum level, it's copyright protected at the moment that you create it. So as soon as you create that handout, it is eligible for copyright protection. Um, whether or not you register it would depend on, you know, is it a revenue driver is the way I look at it.

You know, we can. Register everything if you want to, but there's just a ton of stuff that runs through our businesses. Right? And so the things that we're going to register are basically the things that you would hire a lawyer to enforce in, you know, court, federal court, if someone were to infringe it, and that's kind of the basic standard that I use.

It could also be something, um, that is just so original that you want to, you know, Protected, um, I'm trying to, I'm trying to think of a, of a, of an example of that. That's something super original, but you don't consider a revenue driver. Um, but generally, you know, because copyright registration gives you access to federal courts to get damages for infringements.

That is an investment to pursue damages. I mean, it is right. And so, um. Those things that you, you register will be the things that you'd be willing to make that investment. And so Did I answer your question? Thank you. Yeah.

And again, so, you know, these are cumulative. Um, you know, for me, as I continue to develop my business, you know, many people, you obviously must almost everyone starts in the 1 to 1 services. And. Maybe they add a group coaching, you know, maybe, you know, they do the licensing and they go to the 1 to several, but they still do 1 to 1 services.

Most of us continue to do that. And maybe eventually we'll get to, we create a offer that we can, you know, maybe we have an assessment tool or something that we can now offer on a subscription basis that people can use, but we're still doing our 1 to 1 services with our, you know, Best clients, we might still have something that is 1 to several, but we also have this.

And so it may be cumulative and we continue to need all these things. And maybe some of them drop off Margie. Yeah, I, um, I have a question. Um. And this comes up in my world of consultants that I live in, um, as a consultant, you can bring in other experts to a job. And for some reason, I've got a delay going on here.

It does happen. That's the live thing. It didn't happen in the last time I was in. But anyway, I've never had it before, but, um. Anyway, the topic has come up. How do you protect yourselves from them? So you mentioned that we would have in our contract with them that they can't steal the client and anything that we want in conjunction with our relationship question came up, what if they screw up and they cause damages?

You would have to have that in the contract with the client, right? Just cover it. Well, the client, um, I mean, it's possible to have a client in the client agreement that you can't, they can't work for your facilitators. Um, but generally we more often we see it in the, in a non solicitation for employees. I see that more frequently that, you know, we have a services agreement, and you client are going to come and poach my employees, like I see you see that a lot.

I can't say I sometimes I see you can't poach my contractors. I definitely see that as well. Um, so you can have it from the client agreement side, but you also definitely want to have it from the facilitator side, or, you know, consultant side, uh, that they won't still, they won't go around you and you will have a remedy in there, whether it will be liquidated damages, you know, where you get.

You know, the profit that they made, or they have to, if they, you know, there's a set amount, something like that, you can have is 1 of the options, um, more complicated option is to be able to, um, get. What's called equitable relief so that would be an injunction. So you would go to the court and say, like. Um, stop them from providing those services.

It's not great relationship wise to do that, but it is valuable enough, you know, you could do. Yeah, it was more in references to damages if they didn't do what they were supposed to do. So, it might even. Behoove them to have their own contract back. It's complicated, though. I mean, with the client. Uh, yeah, you wouldn't know they should.

I mean, if you have a list of the client, so I'm making the assumption that you have, let's take example of you have a corporate client that needs some, uh, H. R. You know, workshops, and they need, you know, a dozen of them and you can only do half of them. So you're bringing in a facilitator to do the other half and there and the facilitators using your workshop materials you would have in that facilitator agreement would be between you and the facilitator, not between the facilitator and the client.

You have the relationship and agreement with the client, and it says, I'm going to deliver 12 workshops and that you can bring in a subcontractor and then you would have an agreement between you and the facilitator saying, you're going to deliver these 6 workshops for this end client using my materials, but you will not, you know, solicit business with this client, you know, for the next year, whatever it is so that so that they can't go around you.

Okay, thank you.

So, as I mentioned, I will turn this into a kind of a resource guide for, for, you know, pointing you to other resources that I have available that address. All of these issues, so have a nice round up now. Your hand is still raised. Margie. Is that because you have another thought? I want to share. I want to thank you for, um, oh, yes, um, for the, the 1 to 1, um, because I was just looking and I've been learning about intellectual property, but the question still came to my mind this morning, you know, identify your IP Okay, Ben, where do we begin with that?

And I know some of it, but I love the way you made this be very clear. So thank you a lot. It's, it's always, you know, everything's a work in process. That's the thing about expertise, right? It just, you know, you got to keep working at it ever ends. And every time, like, You know, I think I've got like, Oh, I've got the perfect way to present this.

And then I'll make a graphic or something and then something else will trigger. I'm like, Oh, you know what? A better way to present this is. And this was for me, like, I'm like, Oh yeah, yeah, yeah. I like this. So we'll work on that. Presentation, but I really like to think about it this way. So thank you. Yeah, it's good.

Awesome. Well, thank you so much. And the recording is available in my LinkedIn profile, YouTube, and I believe on my podcast, but we'll see about that. Um, and, uh, and then I will also, uh, make sure that, uh, I get the links to all the other resources out as well. So you know where to find me if you have, Oh, I actually have another slide about that, but you can find me at thinkbeyondip.

com, Erin Austin on LinkedIn. I don't actually know where my YouTube channel is. I should know that. Um, and, uh, but any case, thank you so much for joining me. And, uh, if you have any questions or ideas for, uh, additional LinkedIn lives, do not hesitate to share. Uh, love to do these. Thanks. Super helpful. Thank you.

Thanks for joining me today.