Making Money as a Coach

Video Transcript

Joe Friel  0:05  

Gordo. I’m trying to refresh my memory… help me remember things that we did a long time ago. We met and I think it was the spring of 2000 in Colorado. You were coming from Hong Kong and we spent, I think, a weekend together. I can recall going for rides with you in May, we may have done some runs to some other things. We were both in triathlon, so we shared that. But what I began to learn from you was that you saw the world differently than I did. Which is intriguing for me. You came from a business background, I came from strictly a sports background, I had to when I got into the coaching business, which I was in at that time, had one of the original coaching businesses in the U.S. I was at the point where I was trying to figure out how to be a businessman, you came with a business background, and you wanted to figure out how to become involved in the sport side. I found that to be unique. That was something eye-opening for me, because now I’m talking to somebody who sees the world differently than me. So, take us back. What were you doing before you came to the U.S. to meet me in the spring of 2000? What was your business background?

How Gordo got his background in triathlon

Gordo Byrn 1:26  

Okay, so I was a partner at a private equity firm, based in Hong Kong, and, at the time, we were investing all over the Asia Pacific region. And I had come to triathlon, around the time of my 30th birthday, which would have been sort of the end of 1998. And I signed up for an Ironman. This was back in the day when you could just sign up, and I knew nothing about the sport and didn’t know how to swim. And that first year, getting ready for that first Ironman, I hadn’t come in contact with your book yet, The Triathlete’s Training Bible. I had Troy Jacobson coaching me… it was back in the day when your training plan rolls off the fax machine each week. And I would just have to try and figure out how to do the plan; what it all meant.

And then I came across your book, The Triathlete’s Training Bible, and I read it cover to cover and then applied it. And for me, you really explained everything that I wanted to know as an athlete. And it worked that winter. So now we’re talking. So I’ve done my first Ironman, and then the winter 1999 to 2000 into the spring, it was just an amazing period when you’re on that big upswing and personal performance. And it was just a lot of fun. And then, I don’t know how I found out, but I found out that it was possible to go spend a weekend with you. And I was like, Wow, I gotta get to the source.

I remember I turned up with color-coded spreadsheets, the whole deal. I had laid out the annual training plan, I’d kind of created it for myself and ran it forward across the whole year. And that document that I built, ultimately, became a key part of how I would coach. And then we went on and kind of took your structure, that Triathlete’s Training Bible philosophy, and we applied it to Ironman-distance racing, longer stuff, in our book that we put together a few years later [Going Long: Training for Ironman-Distance Triathlons]. And it was just a really fun period of time for me, just learning and applying the structure.

Coaching as a peer and role model

Joe Friel  3:52  

Yeah, it was an interesting time for me also, because, as I mentioned to you, you kind of opened my eyes to a different way of seeing the world. I think what happens now, in coaching, with coaches opening businesses, is they come to it the same way I did. They come to it from a technician’s perspective. They come to it as coaches, they come to it from a sports background. And they assume the business side will take care of itself; it’s not going to need really much input from me because it is just business. Did you see anything as you came into the coaching business that set you apart from what other coaching businesses were doing?

Gordo Byrn  4:33  

Well, I was… yeah, actually, it was one of the interesting things was for my target market, the athletes, specifically those Ironman-distance athletes, I was a peer. And I was also a role model. So, I think most everybody would want to get a lot faster in a couple of seasons and go from being out of shape, to in shape, to very fast. So my personal story, I think, was very attractive. Almost from my second season in the sport onward, people were asking me to coach them. There was a lot of interest.

From a coaching perspective, and, and very much from a business perspective, I think there are sort of two periods that are worth discussing. So, there’s sort of the initial period, where I’ve got other things going on in my life. And people are approaching me and asking me to coach them, and I’m like, “Sure, I’ll help you out.” And we come to an arrangement on the fee. And that really is just going into helping me defer some of my own travel expenses.

I think that type of coach still exists, somebody’s spending a lot of money on the sport, and they want to coach, and they’re good, knowledgeable, they’re good with people, they want to earn a little bit of income. Okay, that individual, that competitor, is out there in the market. I was very much that individual. Then I thought, “Okay, let’s, let’s try and scale this up a bit.” So, in the scaling up–that’s where I made a lot of mistakes. And in one sense, it was kind of a learning curve–I paid my tuition, learning how to go from really what’s just a couple checks rolling in every month from a group of athletes to “Okay, let’s try and make a business here.”

I try and do that. I hire employees, I try and scale the whole thing up, and I realize one day, “We’re not making any money. We’re like… we’re losing money. But the amount of money we’re losing is less than, what triathlon was costing me.” In a sense, if I take my whole triathlon life, and I put it into a P&L, I’m mitigating some of the cost. And I’m learning. I have great guys around me, we have a lab in my basement, a physiology lab. In effect, I’m kind of going into coaching business school, trying to figure it out, and everything’s rolling along fine.

Then we get to about 2008-2009 and my other gig in business hat runs into difficulty. My nontriathlon, noncoaching consulting business runs into difficulty; my employer on that goes into insolvency. All of a sudden, what was just a comfortable side gig where I could just finance the losses, it’s now more like, “Wow, I gotta figure this out. Now, like, within three months, because I don’t want to burn any more capital in this situation.” When a crisis comes, you know you’ve got to figure it out. So the coaches, we all get together, and we try to figure out what to do. I learned a lot from that [experience].

The key thing is to ask: What do you want to get out of the coaching business? Before I just wanted to recover a bit of my travel and expenses, but now, it was a very specific goal. And that forced a focus on the financial side [of my business] that hadn’t been there before. I learned a lot. So, my first piece of advice to a coach that’s listening to this would be this: Understand exactly what you want to get out [of the business financially]. For me, that [amount] was my number one thing. And I either got it out, or I didn’t get it out, and I did not care what it took.

Then you need to have a quality of life discussion with yourself and with your family. How many hours? I just asked myself a simple question: How many hours a day? How many hours a week? How many weeks a year? Do I want to work?

How many hours do you have?

Joe Friel  9:19  

So, were you working backwards to figure out an hourly rate you expected to bring in from coaching?

Gordo Byrn  9:25

So, at first, I just wanted to ask that question: What am I making per hour? Yeah. I mean, if you’re losing money overall, you’re paying to be a coach. So that didn’t seem sustainable to me. After my consulting gig went away, it just doesn’t make sense to spend all of this time and not make a profit. Once I priced my time properly, a lot of things became clear to me… what I didn’t want to do, for example. It also gave me a price [to determine] if I could hire somebody to do something… bookkeeping, or, you know, all those kinds of low-value stuff that a coach might do, it takes a lot of time. What you can’t see when you’re in it is [all of the things] you’re not able to do because of the busy work. And what you’re not able to do… [it means] you’re not able to invest in yourself, you’re not able to improve your expert credentials, and you’re not able to improve the way you deliver coaching to people.  

Managing client relationships, retention

Joe Friel  10:38

One of those variables always in the coaching industry is client retention. At the end of their seasons, people tend to go away, and you’ve got to find somebody else to come in. Of course, it’s always less expensive to keep somebody around than to try to find somebody new, as a client. How did you deal with that situation for your business in the early days?

Gordo Byrn  11:00

Okay, so I, I actually looked at it the opposite way. So, I said, “Well, there’s some clients, I might be better off not having.” I had a red light, green light, amber light, so I kind of knew where I stood with the folks that I was working with. But I’m conscious of the fact that I don’t want to burn bridges. And sometimes, I can be delivering a lot of value to somebody, but it might be really draining to me. And so, at the end of each season, I would normally have two or three athletes where I might be seeking an exit and managing that. I wouldn’t actually get to the point where I would, say, fire somebody. But when you get to those natural breakpoints, it’s time to improve the quality of your overall portfolio of relationships. And by doing that, you create space for another good relationship to come in. So that’s one thing that a coach should be thinking about. If you’re always maxed out, you’re not going to have space for some really good relationships.

Other revenue streams: Training, Camps, & Services

Joe Friel  12:20

What were some other resources you found that were good for bringing in capital to your company?

Gordo Byrn  12:25

So, I would say if you’re looking at another revenue stream, like the camp revenue stream, somebody needs to be an expert at that, and they need to have responsibility and a big incentive for that P&L. That’s how it worked [for my business]. The other issue is that a lot of coaches turn up and it’s like, “Oh, I’m getting paid to train.” That’s not really the case. What we found is that you need to be offering a service if you want to turn that into a business. So, it’s not about really any of the people working, it needs to have a different point of view, it needs to be about offering something to the people attending. And that mindset is key. I was still a really focused athlete, when I was doing [camps], kind of not figuring it out. I think I was too focused on my own training and that was detrimental. That’s camps.

Another thing is retail clothes. I would always expense that immediately. Do not plan on making anything, any money, from the retail aspects of your business. It’s easy to buy a lot inventory and tell yourself that you’re going to make money on that. But it doesn’t work. It’s just a promotion.

As for client retention, I mean, [gear makes for] great prizes. People love to receive high quality goods and stuff. So, we found with our team that it worked best if we just offered really high-quality stuff–people bought it themselves, and they loved it. We didn’t make any margin on it; we would just offer them the opportunity to get high-quality stuff. That worked best for us.

Opportunities to increase profit

Joe Friel  13:59  

As you look back at your business now, and how you did it, is there anything you would change about the way you organized your business in such a way that you could make it profitable? Is there anything that that you see are avenues where coaches have the opportunity to produce a profitable income from their business?

Gordo Byrn  14:19

Okay, well, most coaches are operating out of a home office with equipment they already own. So there’s no upfront capital investment. It’s a consulting business with a small amount of assets. So that’s why I say you should really be expecting to be generating cash from day one. Now, related to that, though, I did make a large investment in a human physiology lab—the best we could buy and it was a big capital investment, and we never really made much money [on that investment]. But what we did do… we gave ourselves an edge within our coaching. We knew that the training that we were prescribing for the athletes who we had moved through our lab was better.

Invest in what differentiates your business

Joe Friel  15:17  

…Better than other coaching businesses were producing? So, you’re comparing yourself now with the services you were competing against; comparing yourself to other businesses?

Gordo Byrn  15:25

Yes. It was better than anything on the market at that time. And we would see lab results, I mean, we would have the ability to look at other lab results and say, “That’s wrong.” I mean, we had an exercise physiologist as a member of our team, Alan Couzens, and he taught me so much. So, in a sense, if you’re going to spend money on something that might not generate a return, do it in a way where you’re going to get something from it.

Marketing results, sharing information

Joe Friel  15:54  

One of the things I realized very early in watching you become a coach of a coaching business was that you went from zero to 100 in a very short period of time. You’re the only coach I knew who was unknown when you first started, and within three years, you were known by almost everybody in the sport. That was remarkable. I’ve never seen anybody pull that off. Most people always kind of remain in the recesses of the coaching business and never really fully arrive. People don’t find out who they are. Who is this person? What are they all about? With you, it wasn’t that way. With you, athletes began to realize who you were very quickly, once you moved into the coaching business. What was the key to your marketing? How are you making this happen?

Gordo Byrn  16:43

I had a friend build me a website. And I hosted my own chat room. That gave me the opportunity to reach people and share what was working for me. And it was really working. And I think people got excited by that. And then I would go to the big races and do well. And so it was a great promotion.

Joe Friel  17:14

Giving your own racing was good promotion, your own results,

Gordo Byrn  17:17  

Everything. I was an open book. So every week, I would post a text file of what my training had been. Everybody could see what I was doing every week, and they could see the results. And I think it was a really powerful form of marketing. I mean, I was the brand. It was like, you know, this is what you’re gonna get. You can’t promise results. But they were [thinking], All right, here’s this guy, and he’s doing the training. He’s getting the results. I think people really were attracted to that. The piece of advice for people to remember is: Every time you talk, write, post, whatever you’re doing, you want to be talking to your next client, and you want your existing clients to be proud to be associated with you. I think that is a key thing, particularly with all the noise that’s in social media right now. So you’re always remembering that you’re the brand, you’re the product, and you’re presenting and talking to that person to try and get that person to reach out to you. And so how can you help them?

Joe Friel  18:27  

Well, so far, we’ve gone through the early days of your coaching, you’ve taken us back to the late 90s, into the end of the 2000s, and how you were marketing your business. But now we’ve moved into a new phase of the world. In the social media world, interaction with clients has changed. We’re using Zoom to speak to people around the world now. Whereas before you were going to start at the fax machines. The world has changed dramatically. Is there any advice you would give today to a new coach who’s getting started in the coaching business?

Advice for new coaches

Gordo Byrn  19:02

Yeah. So first, you gotta, you need to know, your cash flow per hour. It’s going to dictate who you’re coaching, and how you’re coaching. It’s a key metric in any consulting relationship. So I would say [first] understand that. If you’re at the stage of your life where $35 an hour is going to work for you… it’s a much different situation because you have a lot more ways to get that.

Then if you’re saying, “Well, to make the numbers work, I’m going to need to be up around $275 an hour, it’s just totally different. And you’re going to be dealing with completely different parts of the market. So that’s first thing… understand that.

Then, coming from private equity, I think that if I’d had a slightly longer-term view and understood the nature of my best relationships in triathlon, I would have made a jump to have the athletics and the sport, just be part of the coaching–part of it, not to be all of it. I think there’s a role for [coaches or consultants to help] families, multigenerational families, understand lifelong fitness, lifelong health, lifelong capital, and earnings expenses investing. So given my background, I would take a more holistic approach, acting as a trusted fiduciary to help a family develop their human capital across long time horizon. So [this looks beyond] the mad scramble to get everybody’s plans together on whatever day you do it. (I think a lot of coaches go to blocks because of that. So… you can rotate your athletes doing it a block at a time rather than a week at a time. But it’s still got that deadline bit to it, as opposed to focusing on more longer-term goals and helping families develop over time.

Learning the business side of coaching

Joe Friel  21:04

Interesting stuff. If you could give advice now to a coach who’s getting started in the business, what might you help them understand about becoming a good businessman in terms of having a coaching business, as opposed to becoming a good coach, which is a different perspective. What would you suggest they do to become a better business, to have a better business, become more profitable?

Gordo Byrn  21:32  

So, if you’re a young coach, or really any coach, and if you’re willing to work, I would say you’ve got to get yourself with a group, a head coach that knows what they’re doing–the best in your state. … You need to be making money, you need to be cashflow positive, but you need to be doing a lot of coaching, a lot of case studies, a lot of actual work. The other thing is, you know, ultimately, if you’re going to be a head coach, or you’re going to be somebody that becomes really good at coaching, there’ll be a time where you may want to head out on your own or change the nature of that relationship. Sometimes you need to leave the firm to do that. Not always… sometimes they can kind of work with you, but it’s okay [to leave]. Whether you’re a head coach or associate coach or a junior coach just starting out, just understanding that things change sometimes and that’s okay.

Joe Friel  22:26  

Gordo. I’ve had a good time talking with you. As always, I’ve learned something today just from being with you, which I have over the past previous 21 years now. So again, thank you very much for being a part of this and sharing your advice for coaches. This is the sort of information that coaches need to have to examine how they’re running their businesses. And you’ve been a big part of that. Thank you.

Gordo Byrn

Thanks.