Fast Foundations The Podcast Episode #21

Contracts Every Business Owner Needs to Sleep Well at Night with Danielle Stead Blanton

Show Notes

In this mentor session, we have an attorney in the house!

Legal can be intimidating for entrepreneurs, and it doesn’t have to be! Tune in as R.T. chats with guest Danielle Stead Barton about the things entrepreneurs need in place to sleep well at night, and know their business is protected!

R.T. also shares a bit about his experience when one of his businesses was sued, and what he wished he knew and had in place to protect his business.

Danielle makes legal less intimidating (think, if your bestie was also a business owner who understands your needs AND understands legal!). She shares what to prioritize first, and what the price range looks like for investing in what you need to build a solid legal foundation for your business!

In this Episode, we talk about

  • Legal basics every business owner needs and questions you should ask your attorney.
  • Danielle’s journey from quitting her corporate job as an attorney, to helping business owners with legal, systems, and more!

Listen Now


Connect with us

Instagram @fast.foundations

Connect with Danielle

Instagram @danielle.stead

Follow our hosts on Instagram!

Jim Carter | @causehacker

R.T. Custer | @rtcuster

Key Moments

00:40 The dangerous gamble of not investing or cutting corners with legal.

03:30 What led you to become a lawyer?

06:00 How Danielle pivoted from law to helping fitness businesses.

09:00 How do you describe yourself and the services you offer?

12:15 The things every business owner needs to sleep well at night!

17:00 What is something business owners need that they are missing?

20:30 How do you protect your intellectual property?

24:15 When I receive contracts, what should I look out for or negotiate?

32:00 Lessons R.T. learned when one of his businesses was sued.

35:15 What is a good price range for investing in contracts and legal support?

40:40 What questions should we be asking when choosing the most valuable contracts to invest in?

43:15 Where can we learn more and connect with you?

The Quickest Way to Grow Your Early-Stage Business

The Fast Foundations Community is a network of entrepreneurs who want to grow together!

Whether you are about to make the jump from corporate to launch something new, working on side hustles and want to take those full-time, just starting out on your entrepreneurial journey, or struggling to scalewe are here to support you & don’t want you to continue on alone.

They’re hoping that by cutting the cost of illegal, they can maybe what? Save a couple hundred dollars here and then, and then do what with it, invest it to, to a photo shoot or to a new software or whatever. But they’re cutting corners where we don’t want to cut corners and they’re using template legal agreements for the basis of their business when that should really be the strongest part. It’s like building a house. Would you want your foundation to be built of really strong wooden concrete, or do you want your foundation to be built of like old newspaper trimmings? And, and I think when you think about it that way, you’re like, well shoot. Like it’s pretty obvious

What is keeping you from growing your business to the next level. I’m Jess Burgio, one of the hosts here for Fast Foundations, the podcast Between the three of us, my co-host Jim, RT and I have grown several businesses scaling Beyond Seven Figures. And you know what? Not a single one of those businesses came with a blueprint for years. We poured time and resources into our businesses from salons, tech companies, and product-based businesses navigating success and failures on our own. For all of us, though, it began to change in 2019 when we found a community of like-minded entrepreneurs and industry leaders to mentor us. That community was fast. Foundations just like the mastermind. We’re bringing on experts in having discussions to give you tips to not only improve the foundational skill sets you need, but to also fast track your growth. We’ll dive into the core pillars of what will make your business succeed. Whether you have a brand new idea that you’re looking to turn into a business or you’re already a successful entrepreneur looking to scale, this community is here to take you to the next level. Let’s dive in.

RT CUSTER (01:43):
Welcome to the Fast Foundation’s podcast. This is RT Custer coming at you with another mentor session today I have Danielle Stead, Blanton on the call with me. Danielle, I want to hop right in. You said top of mind is that a lot of people, a lot of entrepreneurs are maybe a little afraid of the cost to properly protect themselves and they don’t even like realize that they can get contracts and protect themselves legally in their business for not a whole lot of money. And also just how valuable and necessary that is. And obviously I have direct experience in that. So please like what are your thoughts on that? Why are you so passionate about that subject?

Oh my gosh. Well, I have a personal story too about having a contract that was well written that allowed me to get out of something, a bad business deal. But as an attorney and as a business owner who has been doing both for over a decade now, I can tell you that there is no such thing as a one size fits all approach. And I think a lot of business owners these days are looking not just at the legal zooms or the rocket lawyers, but they’re looking at these smaller coaching businesses, and I don’t say smaller to be diminutive who offer template legal. And they’re hoping that by cutting the cost of illegal, they can maybe what, save a couple hundred dollars here and then, and then do what with it, invest it to, to a photo shoot or to a new software or whatever.

But they’re cutting corners where we don’t want to cut corners and they’re using template legal agreements for the basis of their business when that should really be the strongest part. It’s like building a house. Would you want your foundation to be built of really strong wooden concrete or do you want your foundation to be built of like old newspaper trimmings? And and I think when you think about it that way, you’re like, well, shoot. Like it’s pretty obvious. But watching how the bi the entrepreneurial business world has shifted in the past few years, this has been an afterthought for so many people. And instead I’ve seen firsthand how those who have put it at the front of mind of building their business have been more successful. They have better relationships, they have better clearer boundaries. And the people who haven’t are coming to me to clean up messes that are costing them five times what it would’ve cost them to do it right. And you know, it’s always cheaper and less energy and less stress to just do it right the first time than to clean up a mess. And I also am saying this because last night we accidentally flooded our kitchen because we put in our refrigerator filter the wrong way cuz we were lazy and we spent all night cleaning up that mess.

RT CUSTER (04:23):
<laugh>. Yep. Yep. Uh, well it’s some, sometimes it’s, uh, do as I say, not as I do right in in in all these things as as. And that’s just entrepreneurship I feel like. But um, but I, I have a million questions before I dive into that though. Tell us more about your background. Why are you so passionate about this? You know, how’d you get into law? Um, and and why’d you choose this, this focus for your entrepreneurial journey?

Yeah, that’s a great question. Thank you. So I um, I always like to preface this story with, I come from a family of achievers. And so I think when you, when you feel like you have family expectation on you, you do the path that you think you’re supposed to. So I was a collegiate athlete, I was a division one national championship water polo player. I was the president of my sorority. I did all the right things. And I graduated college in 2008, which as we all know, was one of the worst recessions in history. And I didn’t know what to do. Not a great time to graduate college with a degree in sociology. It was terrifying. Very marketable <laugh>. And, uh, my parents are doctors, they’re successful doctors. And they said, you don’t wanna be a doctor, go to law school. Uh, you’re smart.

You could do it. So I took the lsat, surprised myself, got into a top law school, surprised myself. And it was just this very, oh, okay, this is what you’re gonna do with your life. Went to law school secured, like really prestigious fellowships got a great job upon graduating past the California State Bar on the first try. It’s the hardest bar in the country. So to me it was just kind of like, you’re on this path of life. And I ended up practicing in big law, which is, you know, no offense to anyone who enjoyed it or had a good experience, I personally did not. It was soul sucking. It’s as bad as everyone says it was, but I did my time and I didn’t have time to realize that this was not for me. And it was not for me for a lot of reasons.

And ethically it wasn’t for me morally, it wasn’t for me gender equality wise, it was not for me. And I at the time met a wedding really wonderful man who, who we were just dating and he said, I love you and I spent my life with you, but this version of you is really miserable. So like, let’s go find out what makes you happy. Go get happy. And so I quit my job, eat, pray, loved it. And I ended up back in fitness. I had nothing else to do all day. Right. What do you do when you’re unemployed? You go to the gym all day, spend a lot of time there and, uh,

RT CUSTER (06:32):
Hopefully. I mean that’s, that’s what I hope most unemployed people are doing. I don’t know, I asked that question all the time But, um, I’m sorry, continue. <laugh>, you

Could be eating bon bonds on the couch all day. I thankfully went on the other side of that spectrum.

RT CUSTER (06:45):
<laugh> sounds like you did the right thing for sure.

I I hope so. Yeah. But I was at a, a really cool high-end brand called Equinox and they were like, Hey, you’re pretty energetic and you’re athletic. Do you ever wanna teach fitness? And they hired me on the spot. They trained me how to teach group fitness classes and you know, being an athlete and being somebody who was really educational in their nature, I was like, this is the best job ever. Yeah. Until I realized you get paid $25 a class and like how do you go from making this like really high end attorney salary to making $25 an hour? So I started slinging myself in the Los Angeles fitness scene as a like, Hey, I’m this great instructor, um, I can also help you make your business better. And I dunno if you know anything about gym owners, gym owners don’t tend to like to be told that their business sucks, so

RT CUSTER (07:34):
No, but it’s, but it’s, it’s fascinating though cause I’m listening to, um, a hundred million offers by Alex or Mosey right now. And you know, he talks about, um, you know, Jim Launch and all the turnarounds he does, and he talks about the same thing. It’s that whole world is so fascinating to me. So continue. Sorry.

Yeah, no, it is fascinating. And this is, you know, the time that Equinox became Equinox group that SoulCycle has, you know, become public that we’re putting PE money into fitness, nobody has heard of that before. And so suddenly you have, in this Los Angeles fitness scene, which is a scene, you have an attorney who has, you know, a decade of law experience saying, I know how to run a business. I was a corporate attorney, so I ran Fortune 500 companies from the outside in. And so to come to these businesses and say, do you know what’s making Rumble successful? Is X, Y, and Z? You’re a mom and pop studio. Do you wanna be as successful? Let me teach you how. And so I’m gonna be honest with you, it was a really hard struggle because people don’t like to be told their business isn’t great.

But eventually people started to talk about there’s this person in Los Angeles who can help you make your business better. She can teach you all about your financials and rates and contracts and what are the laws in California actually has very strict laws as it relates to fitness and health clubs. So that naturally picked up and as Covid hit, it became not just what are the rules for being a fitness business. It was wellness businesses, it was the aesthetics industry, it was the creative industry. And what I did really transformed into, I was not just this fitness instructor on the microphone. I was running your business on the back end, or I was teaching you how to put systems together to run it on the back end. I was putting together legal, I was showing you that legal is actually the end game of good systems and good financials and good customer journeys all put into agreements and all put into a nice little bow at the end of the, the rainbow.

And it became this really amazing organic growth that’s now allowed me to work with thousands of business owners in, you know, the EU and Australia and Asia and Canada and just everywhere around the world because people are realizing I might be, quote unquote just a small business, but I can be a badass business and I can be very profitable. I can make as much money doing whatever I want. I just know I need to know how to do it. And so that’s what’s led me to you guys and that’s what’s led me to get to be on this podcast with you.

RT CUSTER (09:56):
And that’s, and that’s awesome and we’re so grateful to have you. When you think about like who you’re trying to serve and all the people that you have served and that kind of like vast but also still, you know, piece together a few different niches experience, how do you describe yourself and the services that you offer? You know, I’m thinking like your, your Instagram bio, like your, your executive summary like, uh, law is so vast and there’s so many different sides of it. Um, do you approach it from the, from the wellness angle and focus on those, those business owners still? Or, um, like how, how do you describe who you are and what you do, uh, to your potential audience here?

Yeah, I like to tell people I help you sleep better at night. I like to say I work with small business owners that have big dreams, sleep better at night, run better businesses, make more money, make the clients happier. I think that’s what it really comes down to. I think that what legal is is, like I said, it is the end game of putting together systems in place. What happens when you don’t have systems? It’s a headache. What happens when you don’t know your finances? You’re stressed out. What, you know, what is being a business owner inherently, I I I think for most of us at any stage in business, it’s being stressed out and not knowing what’s going on. And it’s giving people that ability to have that sense of relief and then put into their zone of genius and their zone of geniuses to be the best podcast host.

It’s to be the best studio owner. It’s to be the best beauty consultant. It’s not to be the best business owner. And so I like to say that is my job, to be the best business owner for you so that you can go out there and have the business of your dreams. Small business owners are the bravest soldier you’ll ever meet. They’re the people that say, no thank you to a nine to five, a secure job, a retirement, a pension, healthcare, right? Like they are risk takers. And if you can support risk takers to build businesses that are, to me the foundation of this whole economy and country, that’s cool. Like, that’s a really great way to end your day.

RT CUSTER (12:01):
A hundred percent. And you, I I’m glad you brought up the f uh, financial side of not sleeping at night because I feel like as, as a small business owner, as an entrepreneur, there’s really two major things that prevent me from sleeping and it’s finance, uh, right now, finance first, just like making sure that everyone gets paid, especially around the holidays. Like you can’t miss a payroll this time of year. People do not forgive it period. But especially right now. And, and then, and then legal stuff if just like liabilities in general. I mean, I just, you know, I bought this building recently and um, reali realized the first time it snowed, I was like, I don’t have, I don’t have floor mats. I don’t have anywhere for someone to like, you know, and, and Bella came, uh, came into the office the other day and, and, and I was just like, I texted her before she got here.

I was like, oh my God, I’m so sorry. Be so careful. Um, I don’t have a place for you to like wipe your slow feet <laugh>, so let me know when you get here and I’ll like help. You know? And, and so problem solved, you know, I, I figured that out. Went to Costco, got some mats, but like in the back of my head, there’s always those little things like, okay, somebody’s gonna slip and fall, somebody’s gonna sue me. Um, when I think of finances, it’s really easy for me to be like, okay, the things that are stressing me out are basically all about, um, knowing your numbers, right? They have to, you, you, you say you have to know your numbers, your p and l, your balance sheet. What are like the, what’s the p and l and the balance sheet on the legal side? What are like the couple things that every business owner really needs in order to help them sleep at night?

Yeah, great question. I think the first thing is what you just talked about is liability. We all have it in our business, but we don’t really know even what liability means and we don’t know where to look. And as I was explaining to your awesome group and your mastermind is like, the best way I explain liability is like liability is like predators in the jungle. Like, you know that they’re there and maybe if you do your research, you’ll know to, you know, do I need bear repellent or do I need to watch out for a stream that’s gonna like sweep me aside? And it’s knowing, you know, it’s kinda like, it’s like Los Angeles traffic. What do, which car do I have to watch out for? Am I gonna miss the red light? Like you just, you need to be aware.

RT CUSTER (14:08):
<laugh>, that’s a lot of lanes there. You know, there’s like eight lanes on just one side, like, what’s going on?

I know the GPS on my car is like being the third lane from the right. And I was like, I can’t even tell you what that means.

RT CUSTER (14:19):
It’s Math not driving

1, 2, 3 <laugh>. But no, I think the biggest thing for business owners is having the foresight to know what to look out for. And so in every industry and our every company is gonna be something different, you know, for you with like watches, it’s design, it’s patent, it’s technology. For me, I’m, you know, coaching business owners. What if I give someone bad advice for somebody who has a, you know, a breathwork business. It’s, it’s the effects of of you know, the physicality of what you’re doing. So if you don’t even know what to look out, what red flags to look out for, that’s your red flag. if you go into your business and you’re just like, oh, I’m just a cake maker, I have nothing to worry about. No girlfriend, you could give someone food poisoning. You could be using bad product. You could, you know, there’s a whole list of things.

And this is not to say that we should live ever in that like pessimist, I don’t wanna be a human rain cloud of your business. I’m just such a planner that I want you to know what is a pothole that you could trip in. Here’s how you don’t trip in the pothole. I think if we all say it like that, like, hey, you’re driving on this major road to work, there’s gonna be three big potholes. Do you wanna know about them? I think everyone would say yes, I absolutely want to. So if I say, okay, now you’re gonna start a business, there’s three major potholes. Do you wanna know about them? I think most of us would then like be like, oh, light bulb. Like, oh yeah, that’s no shit. Like I wanna learn about that. So I think as it relates to like our, you know, the p and l example that you gave, it’s what do you need to worry about?

And, and that’s like the biggest thing. And then the second thing is, okay, now that you know, I always say it’s not enough to know like, what are you doing about it? Because if you know and you do nothing, it to me is worse <laugh> that you sat on that information. So whether it’s, you know, putting a contract in place to make sure that your personnel are really clear on their business expectations, whether it’s having liability insurance for a business, because let’s say you actually own a brick and mortar business and there is the issue that you could have trip and falls or earthquakes or fires or whatever that may be. It’s what’s the pothole? And then how do we avoid the pothole? And once you can just put that focus into those two things and, and I know telling people to, Hey, I need you to focus on what could go wrong is like the last thing we want to do, eat the frog, do it, do it once, be done.

RT CUSTER (16:40):
Yep. Yeah. And, and for me it’s, it’s, it’s always been, like you said, I think a few minutes ago, I am just a risk taker. I, I don’t stress about those things. I try not to think about what could go wrong. Because when you think about it from that side, it’s uh, demoralizing, demoralizing, <laugh>. It’s, it’s demoralizing. Um, it, it’s just negative. And the problem with that is if you never think about it, it’s like the unknown. And going back to the financial example, for me, the stress from finances as a business owner is when I don’t know, it’s the unknown that’s stressful. If I know that I have a certain runway, even if I’m like, oh, we’re running outta money, like that’s not good. But if I know the date I’m gonna run out. If I don’t make se some of these sales or I don’t get some funding, then I can take action around it and I’m not afraid of it.

And so I would say, just to back up the point that you just made, thinking about that stuff and what could go wrong, just for a minute at least puts that in your head so that you’re aware of what could go wrong. And then you can have the conversation of how do I protect myself? How do I solve that? So for like, let’s give a couple examples around the wellness businesses that you started out helping and maybe like if you have any more recent examples of a, a non wellness business that you’ve worked with recently. Like what’s, like the, the the one thing that that you’ve done for someone that they’ve really like they didn’t even know they needed and hopefully is gonna protect them.

Yeah, I think the big things right now they’re really top of mind are having in place. Um, so online programs are a really big deal. Uh, masterminds, let’s just talk about your business. Actually let’s just turn this, let’s turn the spotlight on you. So oline program

RT CUSTER (18:34):
I expect free legal advice. Hell yeah, let’s go

Perfect. That’s exactly why I thought I was being brought on here. Okay, great. Um, lemme just start my timer. No, so a lot of people are now using online groups education wise, right? So whether they’re creating videos that you’re downloading or watching, whether you’re enrolling in a 12 week program, whether you’re going into a mastermind, this is like the biggest thing right now in the online coaching and business world. Everyone in some capacity is obsessed with this concept and I’m all for it of like recurring revenue, evergreen content, all that good stuff. So people are signing up to be part of these 12 week programs, masterminds, some sort of something bigger than themselves. And what’s happening a lot of times is that you have people who are then going in on let’s talk about money, who are going in on like installment payments. This is such a hot topic right now.

So it is, I understand fully and I always wanna preface anything I say with like, I never wanna be diminutive as it relates to spending or investing. Like I know money is such a sensitive big topic for all of us. So I never wanna say, if you’re not willing to pay this much money, it’s a, it’s any sort of moral connotation. It’s just this is me speaking very frankly, So a lot of people aren’t, you know, able or willing or want to say like let’s just spend $5,000 off the bat into a coaching program. So they are going to want to do installment payments and let’s say they’re gonna put down half for the deposit so they can start working with you guys and then they’re gonna either put down a monthly installment for the next two to three months or they’re gonna, you know, whatever that may look like.

What a lot of people are realizing is that people are putting down half the payment and then they’re not getting paid the rest because people are canceling credit cards, people are disputing credit cards, people are fill in the blank, right? And whether it’s shady, whether it’s malicious, whether whatever it is. So one of the things I’m seeing a lot is that people are having huge disputes with credit card companies and credit card companies are like, great, we don’t wanna get involved in this petty nonsense. This is your business, this was your bad, tell us how you set yourself up. To fix this. And so something I deal with all of my clients because online programs all of like mastermind groups, this is like something a big that I’ve been doing a lot of this year is we’re putting together really clear terms of service contracts for when you sign up.

So for you RT, with all of your fast foundation people, you wanna make sure that you’re having language, if you do installment payments that account for you to get paid by certain dates and triggers that cut off program access. If you don’t get paid that have autobill language in it and you’re using a payment processor like Striper Square or PayPal that allow for you to bill credit cards that also give you the right to completely go after them for full balances if they try to dispute credit cards. So what some people will do is they’ll go to their credit card company and they’ll dispute it and the credit card company will say, let me see the agreement. And you don’t have an agreement in place. They’re like, oh sorry, they’re gonna dispute it. There’s no agreement we’re gonna take their side cause they’re our client. Alternatively, you might put uh, language in your agreement that says if you dispute any installment payment, we’re owed the whole amount in some plus a penalty. At which point the credit card company’s like you signed a piece of paper now they’re gonna actually pay you guys out for that whole sum plus penalty.

RT CUSTER (21:40):
Cause you’re prepared, yeah. that’s awesome

Uhhuh and most people, we don’t wanna say it, aren’t reading the fine print of their contracts, but you know what, into your contract rt, cuz you and I wrote it to make sure that it’s like, you know, chef’s kiss.Perfect. So this is something that a lot of people are fighting with their online programs is that they’re defaulting on credit card payments, the auto billing isn’t working and that’s really messing them up. The other thing that’s happening a lot is IP violations or people are downloading courses, they’re repackaging and they’re reselling it. And I’m sure you have lots of thoughts and on, you know, violations of ip. But what we know really simply is that you can’t steal our people’s stuff, right? Like <laugh> the laws of the university pretty straightforward people’s stuff. But if you are not

RT CUSTER (22:22):
Pretty straightforward, I think, you know.yeah

what do we know?

RT CUSTER (22:28):
I don’t know. Yeah, well and I think that maybe there’s a difference between you can’t and you shouldn’t. And people read into that. It’s like the, the thing you said the last time we spoke of like, you know, um, I run yellow lights, but it’s the people that run red lights that were, that were Right, the contracts for I love that. So huge.

Yeah. Yeah. So like let’s talk about these red light runners, right? They’re the people who are taking the content maybe out of your master library and they’re repackaging it and they’re reselling it. If you don’t put anything in that actually says like you can’t do this. If we find out we do that, you’re doing this, we’re gonna sue you. And not only are we gonna sue you, we’re gonna sue you for damages and you’re gonna pay our attorney’s fees and you’re gonna, you know, and you put all those stipulations in. Those are the two big things that are happening right now. Social media, online content, it is the wild west. And so unless we can be like so explicit in what we’re doing, this is costing businesses so much time, so much money. And more than that, I keep going back to is this energy and your energy is your time and it’s a non-refundable resource.

I don’t care how much money the judge awards you in jury damages or attorney’s fees. You just spent a year of your life stressing out or you just spent a week of your life chasing down credit card payments. When, when you have these things really clearly laid out in your legal, it’s a no-brainer. It’s actually like how insurance companies look at it. So to go back to your um, Bella example, if you, for example, had something in your employment contract of, hey, you know, we’re not responsible if you slip and fall in the reasonable course of business and let’s say not Bella. So say someone just, you sure I slip and fall, I’m the visitor there. Your insurance company is saying like, do you have any language? And you’re like, yes I do. Your insurance company won’t cover you. But what people are not realizing is that insurance is actually not the best thing in the world. We think it’s gonna save us against everything. Not the case. Credit card companies, not the case. These people don’t wanna pay out money. So think about the cost of the payout versus the cost of a legal agreement. Like not, you know, you guys all can’t see my hands, but they’re not equal

RT CUSTER (24:31):
<laugh>. Yeah. Not, not the same. And there’s, there’s so many things when you look at an insurance agreement and a contract that there’s, there’s so much legalese in there. There’s so it’s, it’s like it’s written in another language and it’s, it’s almost like it’s written so that people like me that are are busy entrepreneurs like we, we just, we scan the first page and we’re like, oh my god, there’s 80 more pages of this. Like, I don’t have time for this. And it’s, it’s, it’s detrimental for the fact that we might not even want to, we definitely don’t want to, but we might not read all the all the, you know, contract that we’re about to sign. So are there, I guess two questions are, are there certain things to look for when I get a, when I get a contract, when I get an agreement from a vendor, when I’m creating one, when I’m reviewing something as a, as a business owner, is there a couple things I can really look for as I scan

Cuz like, I’m gonna be honest, I’m not gonna read every single word on every single contract, but are there like major headlines of like, okay, zoom in on this. Like read every single word of these few paragraphs because that’s where they get you. And I guess my, my next question, which which I’d love to learn more about is just what’s negotiable. You know, as I’m reading through these, what do you think is, are are terms that people normally discuss before they sign a contract and what’s negotiable there versus what’s just, just industry standard and we shouldn’t even like, worry about it?

These are great questions. I wish everyone asked them. <laugh>, let me just say, and I also wanna agree with you that no one has time. I don’t wanna read an 80 page contract. My god, that sounds like the worst use of my day ever. But to, to take it a step back, actually it’s interesting because we’ve gone into such a digital age. One of the things I do with a lot of my clients is I just do contract review for them, especially in the age of, of, um, sponsorships, influencers, brand partnerships. One of the best things that you could honestly do RT is if you or any business owner got a contract that was 80 pages, it’s to call your attorney and say, I have an 80 page contract. I don’t have time for this shit. Can you please look at this and give me the five biggest red flags that I need to look out for.

And I think that’s where a lot of people are also getting themselves into problem, into trouble is that they’re looking at this contract and they’re like this phone book and I aren’t gonna jive today. Toss it, move on. They’re gonna look at the first thing, what’s my payout? How much money am I getting? When does this contract start? Let me sign my life away. And so the very first thing that I always recommend to people do and, and I think it, it’s, you don’t know unless you know, call your attorney. Like that’s what we’re here to do. That’s what we’re literally meant to do. Now let’s say you don’t have a Danielle in your corner, your life is not blessed, but I’m here now <laugh> or you don’t, you know, you, it’s not in your budget.

RT CUSTER (27:13):
They do now. Cause they can just, they can click underneath the show notes here and just contact you and you can review their contracts. But um, well let’s, let’s pretend that’s not a thing. What would they do? <laugh>?

<laugh>. Well, exactly, exactly. So the first things I always ask people are what in, in like a two second summary, what’s the deal? tell me what the deal is. And so let’s say for example, um, I’m just gonna throw this out there. Let’s say for example you were like, Danielle, I’m gonna pay you to be on this podcast. I’m gonna pay you a hundred dollars and I wanna keep your rights for this video forever. I’m gonna repackage this video and I’m gonna be able to use it for content on YouTube. I’m gonna be able to monetize it. I’m gonna put this on social media, I’m gonna create reels. I’m gonna use this as education in my course. Is that cool? And I’m like, yes to all of the above, right? So now you send me a contract. What I want that contract to be able to tell me is if I were to glance at it, or better yet, if my assistant were to glance at it and they would say, okay, I see that dead Danielle’s going on a podcast.

What’s the scope of work? Is it very clear? What’s the financial exchange? What is she getting paid for it and how is she getting paid? This is super important guys because a lot of us are like down to get paid money, but sometimes it says we have to send an invoice and we’re, they’re not gonna get paid for 90 days and then they have to verify or whatever that case may be. And so a lot of times payments are massively delayed and I know a payment delay is at the end of the world. It’s just super annoying. Especially when we’re business owners. We know our churn rate, we know our runway. Hey, we’re really relying on that money to come in, right? So like, let’s make sure that your money is accurate. Next thing to do is to know what rights you’re giving up or you’re getting from the work that you’re doing.

So in this example I talked about, I’m gonna come on this show, we’re gonna record a video. Video equals content. Content equals monetization, right? So what are they able to do with it? Maybe rt, you’re going out there and you’re doing consulting services. What are they able to do with the consulting that you’re giving them? Can they repackage it or resell it? Probably not. Can they use it for other subsidiaries or other affiliates they have? Maybe. So you wanna know both what they’re getting from you and what you’re getting from them and if they’re able to then take what that product is or that services and give it to other people or use it. Super important. The other things to know are what happens when ish hits the fan? Yep. How do we default? What are termination laws? So let’s say it’s a one and done thing.

So something like this for you and I, I don’t wanna be on your podcast. Okay, you don’t pay me done. Right? Other people are actually stuck in contracts that they can’t get outta or they can’t get outta without deliverables or they can’t get outta like non-competes for a certain amount of time. Super duper important to know. If you don’t wanna be in a business relationship with this company or person anymore, how does that happen for you? Now for most of us, we don’t even have that privilege. For most contracts that you’re gonna be in, companies are gonna have that first, right? To just be like, no thanks, we don’t wanna work with you anymore. But you should also know that as well. Like let’s say as an employee and as an employer, most employers can fire you at any moment. As an employee. You wanna know that you wanna know if you’re gonna lose your livelihood.

So termination default, those are the other two, two big key terms. The thing that we’re all hearing these days right now that’s a little bit more technical is called indemnity and indemnification or hold harmless or release of claims. Those are all big fancy words that basically says if again everything hits the fan, depending on who’s fault it is, who’s gonna make sure that the other person is covered. So indemnity is a fancy way of saying that. Like, if you’re working for me and something goes wrong, I’m gonna pay for your legal fees or I’m gonna protect you and make sure nothing bad happens to you. Now a lot of times what’s happening in contracts is that businesses are saying you’re gonna protect us, but we’re not gonna protect you. So you’re exposing yourself to this one-sided liability. We’re not only are you not getting protected, you have to help somebody else out which time, energy, money, all of that.

So indemnity is something that, you know, to go back to your second question, you can always negotiate whether or not you’re gonna win. It’s really up in the air. And then the last thing to know about about contracts. So again, like scope of work, financials, IP rights, all of that termination, indemnity. And this is like a not sexy one at all that nobody thinks about is law venue jurisdiction. That means that when something does go wrong, where are you actually gonna deal with it? This matters a lot because businesses are operating online. So we’re in all different states, we’re in all different countries. If you’re trying to get into a contract with an international company, guys, you might not even have rights to actually like fight with them legally. Huge consideration. The other thing is that being in a courtroom, so like being in a jury trial or a courtroom is gonna cost you 10 to a hundred times more than being in something like an arbitration.

Does this matter? Really? It’s the one in a hundred times. It’s the airbag example. If you don’t have this in your contract, you’re gonna really wish you did. And if you don’t have it or you know you do have it, like you’re gonna be glad that you asked for it. Now this is one of those, uh, interesting conversations because people always say like, what is worth asking for? And the truth is, is you have to kind of look at what the contract is actually for. You’re paying me a hundred dollars for some video. Do I care where we have this arbitration? No, because we’re never gonna get it. Get to an arbitration. And I think that’s the other thing that people need to ask themselves is go to the worst case scenario, catastrophize this, is this really gonna blow up in your face if this is this multi six figure deal? Yeah, you wanna make sure all these points are correct. If this is a Dorito Instagram post, I don’t care about any of those, I just wanna make sure you deliver your content and you get paid your a couple hundred hundred dollars, right? So look at the scope of your contract and really ask yourself what’s the headache, what’s the cost benefit analysis? But go back to those initial points of scope of work, financial payout, termination, IP rights, those are the ones I want you to care about the most

RT CUSTER (33:02):
Awesome. And just to, to kind of drive that point home in my six year lawsuit, Hamilton, Vortic, if, if you guys haven’t, uh, seen that Vortic watch company got sued by the world’s largest watch company, um, we won. Oh, so it was okay, but had I had this very precise type of insurance, um, and it’s not product liability insurance. And, and maybe you can correct me on like what it’s called, but if I actually read the insurance document and if I went to my insurance company within, cuz I read the insurance contract after it happened. But if, if I got sued for a trademark or patent related thing and it wasn’t, and, and it was like defensible, which this one was, then if, if I alerted my insurance company of the fact that I was getting sued within 12 months of the lawsuit occurring and I had this per, you know, particular line item of insurance, which is very inexpensive, my insurance company would’ve foot the bill for that entire six months of, or six years of, of lawsuit plus, um, travel and all kinds of stuff that that my attorneys and myself had to do.

And we were missing that and we didn’t know that that was even a thing. So that’s like tying back to what we started with. Like if you don’t know, you don’t know. And so, I mean, I feel like we could just sit here and just rattle off things that you should know for like two hours and maybe that’d be really helpful. But that’s, that’s one little thing that I didn’t know that insurance companies can actually help you with those lawsuits. You just have to have the conversation with them and make sure you’re covered for that particular thing and have a couple legal documents in place to actually in ensure that that coverage. The, the other thing was when the lawsuit happened, they sued us and all of the documents, like basically the lawsuit had to occur in New York City. It was a Swiss-based company, but they had a New York based law firm and then we’re in Colorado.

Had I had some sort of agreement there, and it’s a little outta scope for this particular thing, but what you just said, if those ag, if there was an agreement in place and there was a lawsuit because of the agreement, and I said, um, the lawsuit has to occur in Colorado. First of all, Colorado law is very different and way easier to understand mm-hmm <affirmative> than New York law. and I wouldn’t have had to travel, they would’ve had to fly to me to, to sit down with a Colorado federal judge instead of a New York federal judge. And, um, the state of new, like, you don’t wanna get sued in New York. Like, it’s not fun, <laugh>. Um, especially the federal districts. Like that was intense. But um, it’s those little things that, I mean, like you said, Danielle, you can just solve it with a simple review from an attorney.

And, and that’s one of the, one of the big questions I had for you if you’re willing to share just like generalities, you talked about costs and I think that’s the scary thing. Can you just rattle off for us, like, and for me too, like I I I don’t know the answer to this. What should a contract review cost? What should I be paying per hour for an attorney for a good one? You know, not a great one. <laugh>, you know, I probably can’t afford a great one, but like, what’s a good range for those things? For contract reviews, for basic contracts, you know, I see all this legal stuff and templates for, you know, $49 for this and $199 for this and you know, I know what I paid my attorney that defended us and it was worth every cent, but it, it wasn’t insignificant per hour <laugh>. So w what should we expect, um, when we’re reviewing the costs of this kind of thing and trying to financially justify it?

Absolutely. That’s a great question and I wanna preface this also by like, I’m in California, I know we charge a lot for just like air to breathe in California, so I don’t want anyone to freak out

RT CUSTER (37:13):
the Sunshine.

Sunshine, sunshine. And you know what, RT I’m just gonna rub this in right now. It, I’m wearing a sweater, which is, it just, it’s because it just got delivered today and I was trying it on, but it’s 75 degrees in November right now. So like, we pay for that guys

RT CUSTER (37:28):
It was, it was 22 when I left the gym this morning. I was like, oh no. Yep. Uh, anyway, continue before I, you know

yeah, so sorry, sorry, sorry. I’ll, I’ll stop that. Um, pull it back. But I think, so what I wanna say is that, uh, one, I always say rates are value and so the rate you’re gonna pay is the value that you’re gonna get. And I wanna say that because to some people, you know, they’re okay downloading a hundred ninety nine, forty $9 form, whatever that might be. And that’s great. And if you find that that’s valuable to you, then that’s not my place to tell you that that’s not your value. Um, what I’m gonna say is that everything I do starts over $500 for really basic contracts. Like let’s say that you just want a really simple like non-disclosure so that somebody who is your studio manager or assistant is working for you, great. That’s gonna be in the like, you know, 6 50, 7 50, 800 range. Why? Because I wanna talk to you and make sure that I understand what you’re actually like having this person do.

And lemme just back it up even further to what I said at the very beginning. Every contract that you’re getting is customized to the actual situation you have. And if it’s not, then that’s also a kind of a red flag to me as well, that if we’re not customizing it to what you need it to be for, you might as well go on Etsy and buy that 49 99 contract. So I like to say that everything I do is, is in the like hundreds, not thousands. And if we start stacking them, then let’s find a price point works for you. But I want people to know that paying 500, 7 50, a thousand dollars for one to two legal agreements is the most reasonable steal you’ll ever make in your life. Now if you are coming to me, let’s say with that 80 page contract and you wanna review it, I charge about three 50 to four 50 an hour to go through it. But I also am then gonna sit down with you. I’m gonna explain every single paragraph that you wanna explain, or I’m gonna tell you what you don’t need to worry about. Now, some people are gonna hear $400 an hour and be like, this girl thinks she’s a brain surgeon and another people are gonna hear $400 an hour and be like, that’s the best $400 I’m gonna spend. So let’s go back to that term

RT CUSTER (39:31):
Yeah, I mean, I, I locked out, I only paid a hundred dollars for this. You know, we, we’ve been on for 38 minutes, so this is good. This is awesome.

I I’ll send you that invoice, then we’re gonna 9inaudible]

RT CUSTER (39:41):
There wasn’t, there wasn’t a contract, so no invoice to be sent, uh, to be sent. I think,

Oh my gosh, the man has learned so much on this call. I, it’s, I’m giving you this power for good, not evil. Don’t forget that. So perfect. But you, you guys are also gonna have attorneys who are very, you know, who claim that they’re so good at what they do, that they’re charging a thousand dollars an hour. Again, it goes back to perceived value to me. Do you want the clients that are gonna charge you a thousand dollars an hour? Great. With that, it’s gonna come a certain level of clientele and it’s also gonna come a certain level of expectation of customer service, of every single thing that you do. To me, I find that like the $400 an hour range is very comfortable to me. I find that charging, you know, seven 50 to a thousand a contract is very comfortable for me. It to me is demonstrative of, you know, decade plus of experience.

It’s demonstrative of the customer experience you’re gonna get with me. But I take it back to the point that I would rather help one extra small business owner who’s willing to make this investment then to say like, no, thank you. I don’t need your money because I’m charging a thousand dollars an hour. That, does that help our industries know why? Because a rising tide with all ships, if everyone believes that they could have something, if everyone could make their businesses a little stronger, we would get rid of so many of the bigger problems. Would that put me out of business? We’ll see. But I think that at the end of the day, if you do good work and you do it at a price point that your clients can afford, you will still be able to be financially successful and hit your own revenue goals. And so that’s kind of a business lesson thrown into all of that. But I think that if we look at how much we’re charging hourly or product wise or whatever, we have to feel good about it. But then I also want you guys to know is $500 to a thousand dollars worth a six year lawsuit? Like I’d say yes, yes.

RT CUSTER (41:25):
Yeah, a hundred percent. Yeah. I mean, I, I would’ve paid that a hundred times over to have somebody review, um, those, those contracts. But you know, I, I didn’t know and you don’t know, you don’t know. So maybe, and, and is, I guess my question is, is it fair to say that maybe one of the first questions we ask somebody like yourself or if we come to you for, for help, instead of saying, how much do you charge per hour? Or how much do you charge for this contract? Say, can you help me justify spending what you charge for this contract? And is this particular legal issue something that I’m gonna get a good return on my investment? Or would you advise me spending my dollars elsewhere? Is is that fair? Like, how, how do you have that conversation with people?

I love that. And sometimes people, first of all, I love talking about value because I think as business owners we need to justify our expenses, right? Like we’re not, we all don’t have money trees in our backyard or if you do like co sister up, but we need to be able to justify what we’re spending. And so for example, some people will tell me that spending a thousand dollars on a photo shoot for Instagram content is worth it. And I’m like, great, but then you have no contracts, but that’s value to you, right? And so if somebody comes to me and says, this is the state of my business, this is where I’m at, I have this much money to spend and I have one thing to spend it on, what is it? Let’s talk about that and then let’s talk about where you’re gonna get the return from.

Like, one of the things that I’ve, I’ve had a lot of people work with me recently is also employment agreements and independent contractor agreements. And because in California independent contractors are such a hot topic, we wanna make sure that your independent contractor or employment or worker agreements are so set that they’re protecting your business. How you’re interacting with people is so set that you’re not crossing any lines or boundaries that you know are state employment laws put into place. So is it worth spending the money on the employment agreement to make sure that’s ironclad versus maybe your website terms of service? Absolutely. Should you then prioritize this level of investment? Yes, but I think that the, for, for people to be able to look at it as an investment, and that’s what I like to say is that this isn’t an expense. There’s two ways to spend money in your business. I think you’ll agree investments and expenses, right? Investments should always be able to pay you back. So the ability that you have this shield around you that’s gonna protect you, that’s always gonna be paying you back for the potential of these lawsuits versus just spending money on a contract that’s not great or spending money on a something that’s just there, that’s like a, you know, a, a vase for your lobby or whatever, yep

RT CUSTER (43:58):
That makes total sense. Well I think that’s, that’s where I would start that conversation and I am so grateful for this conversation, Danielle. I learned a lot. I’m sure everyone following along did too. And if you didn’t learn enough and you wanna learn more, how can these people contact you? What’s the best way for them to reach out for you, uh, for advice?

Yeah, I love to live on social media like we all do these days. You guys can find me on Instagram at Danielle.Stead You can go to my website, Danielle, Ted Blanton. We can link those for everybody and you can get in touch with me there. It’s always me that replies to messages. I’m a huge believer in that. And so if you’re getting a reply, it’s me. So come hang out, come say Hi. Let me know you listened in, let me know who I can help you. And I would love to be part of that

RT CUSTER (44:47):
Well, thank you for helping us and if you’ve been listening to these types of episodes, I call ’em mentor sessions. So Danielle as uh, a mentor to me and now to all of us, thank you so much for coming. Thank you to everyone who’s listening. Everyone who’s watching, we appreciate you. Reach out to us. If you have questions, comments, put ’em right here on YouTube. If you’re watching us on YouTube, um, we wanna know so we can get those questions answered. And then yeah, connect with, I mean both of us on Instagram, I’ve been through a lot of legal stuff. I’d love to help and I’ll probably now just send you straight to Danielle because I’ll be like, yep, that sounds like a document you should have reviewed.

So thanks for joining us today on the Fast Foundations podcast. This is RT. That was Danielle. Thank you Danielle, so much.

Thanks for having me guys. We’ll talk soon.

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