John La Valle – Starting an NLP business

John La Valle – Starting an NLP business

Michael : Good morning John. I’m really delighted to talk to you today about how to grow your professional NLP Coaching or Consultancy practice.

To kick it off can I ask yourself to introduce yourself briefly?

John : Sure. My name is John, last name is La Valle. I’ve been in the NLP business for quite a while actually, as well as being a consultant to companies. I’m not sure what else I can tell you – I’ve got lots of business experience, from starting up companies to working in corporates and finding out what made other companies successful and whether I could follow along some of those things.

And I’ve helped other people grow their companies and have supported them as well.

Michael : Superb. Excellent. And what is business success to you?

John : It’s an interesting thing.

Let me just talk about success for a moment because I just had this discussion the other day with someone and an interesting notion is what people determine as success.

I heard a quote from someone else the other day who was a comedian, or lets say some kind of motivational speaker (I don’t know, I was listening to someone and unfortunately I don’t remember his name.) and his definition was – He was talking about whether or not people, if they were successful, were happy.

And I found it to be quite an interesting question to consider. What he said was that success is getting what you want, and happiness is wanting what you get. And I really found that to be quite thought provoking actually. Let me tell you why.

I find that a lot of people want to have a successful business, whatever that means to them. Let’s say it meets their criteria for what they would deem to be a successful business, but then it’s not exactly what they want so now they want to do something else – they want to do more.

And there’s nothing wrong with that, but it’s a matter of whether they ever defined their criteria to begin with. Just a little while ago as well, I had the opportunity to help some other people decide about what they want, for business anyway. And it was an interesting idea when I said to them ‘What do you want?’ – Most of them, their interesting comment or response was ‘I want to start my own business.’

Actually some of them even said ‘I want to be able to start my own business.’

I like the linguistics part of NLP – I like the meaty piece in the middle – So when they say they want to be able to do it, that’s not good.

I said ‘What do you mean you want to be able to? You just want to ability to do it? You already have the ability to do it – It’s whether you do it or not.’

And they said ‘No, no, no, no, no I want to start my own business.’

But when you start it then what? You have to be able to run it – You have to be able to run it successfully. How about running it up to Facebook kind of a thing, or a Google kind of a thing, and selling it? And then starting another one.

So I think that business success is, for me anyway, is ‘Am I happy with what I’m doing? Can I pay my bills? Do I have something left over that I can put towards retirement?’

What we need to do, for income, to sustain our lifestyle, which is not all that grandiose, is not that much actually. So everything after that is, to us, extra – The icing on the cake, or the cherry on top of the icing kid of thing.

So, we’re quite happy doing what we’re doing. We could probably, if we really wanted to, grow our business even more so, but the fact is we’re not that interested in growing it that much more because it keeps us quite busy actually. We’re happy being busy and the money we make is really satisfactory to us.

I don’t know what other people would define as successful business.

A good amount of our success, however, is highly defined by our customer base. A couple of things that we look at for example are what is our rate of people coming back again – our return customers – and that’s really quite high actually.

I would say – and I’m not even sure what a good standard is – that at least a third of our customer base are return customers. It might be a bit more than that. And I’m talking in the NLP business of course, and you also have a consulting practice which is a little different – There it’s whether or not they can do what they need to do without us needing to come back in again.

To me that’s a very, very different market.

In terms of our customers it’s whether they are satisfied, what type of comments we get back from them – Things like that – Interestingly enough, we have a store where we sell things and we have two people in a year, maybe who say ‘I really didn’t like this product.’

And to me that’s good information. We’re always willing to accept information and feedback, so to me our customers define our success.

One is we’re able to stay in business. Two is we’re not out there doing any heavy marketing, we’ve got a good presence but we’re not doing anything extra, above or beyond what we’ve been doing for advertising for the last four or five years.

Michael : Two question : How did you start? And what do you think made you successful when you started? and what do you think keeps you successful now?

John : It was interesting how I got started. I was actually working for a company. And I know that people when they hear this – some people – will say things about me like ‘You lucky – bleep-‘

But I really was quite fortunate. Firstly I grew up in a corporate environment and before that I was an entrepreneur – I like to think that I was anyway. Probably when I was about twelve or thirteen years old I liked having my own little business, whatever it was and back then when I was young I would sell tiny little explosive devices like firecrackers and things during the summer months.

Until I got caught of course. But I relished being in my own little business. When I got caught my dad said ‘Son, you cannot do this, it is a bad business. Some-one’s going to get hurt. You’re going to get into trouble. Blah, blah, blah.’

Then I got a newspaper deliver route which lasted about two months – Probably because I was very unmotivated and didn’t make anywhere near as much money as I had been making.

And I still held onto that entrepreneurial spirit. I held down a few jobs of course when I was younger. When I finally went into that corporate environment I did so because I really wanted to learn more about “Official” businesses did things.

I worked in, I’d say, just about every function in a company other than finance. I worked in manufacturing, operations, distribution, quality control, human resources – which comes as a surprise to a lot of people.

But I did those things, and was given the opportunity to do those things by the company I worked for at the time as part of my development, if you will. And I learned a lot of things.

Now, when I decided to go on my own I actually made that decision – I was in human resources and I realised that I was going to get bored again, that I would have to do something different. And at that time in my career I said that I would just go on outside to be a consultant.

And the confirmation came to me when I got to write my very first check to an outside consultant. I was in a company and I got the guys invoice and I had pay the order to pay the invoice – I looked down at how much this guy made for one day and thought ‘I can do this’.

I really did. I looked at the amount of money and said ‘I don’t know if I can make this amount of money in a day.’ But what he did wasn’t anything that I didn’t know how to do myself.

I also realized that there was probably something that was missing although I wasn’t sure what they were. Like an ability in the marketplace – because I wasn’t quite there on my own just yet.

Interestingly enough. When I first went into the human resources department my role as a trainer was to act as an internal consultant. Now that was clearly defined by my boss.

He said ‘Listen I work you to work as an internal consultant, as in you have to get people to want to use you. I’m not just going to send you in and say ‘Hey you all have to listen to what La Valle has to say.’ You’re going to run this as if it were your own little business. So if the internal customers aren’t willing to use you John, then you’re out of a job.”

Michael : How did you get people to want to use you?

John : Well it wasn’t easy, I must tell you. Mostly because I came out of manufacturing. I was basically what you would call a “Plant Rat”, a guy that went around making sure that operations were running and everything was fine.

So I really had to turn around the perception of what I was able to do and what more I could do. And quite simple, what I did was I started to address two major areas in the company –

One was performance appraisal and coupled with that of course was to have to company to identify – and I don’t like to use the word because it wasn’t a needs analysis – the skills that were necessary so that I could conduct, or put together trainings that would satisfy the managers of the company.

So I ended putting together a couple of systems and one was to do not a needs analysis, but a skills assessment and then because I really wanted to relate it back to skills appraisal, rather than do just performance appraisals I had managers first do a skills assessment on their employees – To rate them on a scale of zero to ten on a series of skills.

And then I took that and had them link it to the individuals performance appraisal – That way it was more objective for them. And then number two, I had that information put into a system that I had built so that I could determine which seminars would be relevant to the company.

Then I put out a schedule and go ‘Well listen guys, this is what you told me that you need. This is what you want. And this is what you need for skills development. Now here’s my schedule for the seminars. Start signing your people up.’ Which they did.

Michael : Excellent. Moving forward to the present time. What do you think is important about starting a business now in 2001, as opposed to starting it in the last couple of decades? If you had to start again now who perhaps hasn’t got that much experience what do they need to be aware of?

John : Well, that’s really a great question, and I’m thinking it through as I speak.

I don’t know that there is really that much more that is different today with the exception that the field is bigger. There are loads more consultants out there if that’s what they want to be doing.

But the idea to me hasn’t really changed. I learned most of my marketing skills from what most people would call an Old-Timer guy. J Conrad Levinson. This was the guy that was involved in developing the Marlboro Man, The Pillsbury Dough Boy, The Jolly Green Giant and I studied things from him – I know him personally – that were old-time marketing things.

The only thing that has changed with the marketing things is the availability now of the Internet. But I’m not even suggesting that the Internet is the best place for people to do marketing.

I’m not sure how much more has really changed – let me tell you why.

The things that I find that have not changed, that people are still interested in is, number one, that they know who you are, whether you have credibility in the marketplace. That hasn’t changed.

The bulk of my corporate work, even to this day, is done by word of mouth. Since we started our consultant business back in the middle Eighties, we’ve only spent on marketing dollars, in all this time, we’ve spent one hundred and ten dollars.

I know. And that’s called business cards and letter heads. And I don’t even hand them out! I have all of my brochures ready on my computer, I still keep updating them, but I’ve never had them printed!

So, the success that people can have in terms of starting and having business – I’m going to say, and I don’t like the word – is in your networking.

I think that’s where the value is. And I don’t mean networking on these social sites, all of these places – That’s not networking. I mean networking with the people that know you.

When I first started and I was leaving the company I really was fortunate. A lot of people say ‘John you were fortunate, but you did a good job for the company.’, which is true.

The company would literally, not let me quit because they didn’t want to have to replace me. And that was only because I had good feedback from the seminars that I was doing.

When it was time for me to leave, to take some time to build my business I took a couple of years to do that. And when I was ready to leave, because I was ready to leave my job actually – My boss asked me ‘What time will you have to leave?’

And I said ‘When I’m not here. And people say ‘Where the hell is La Valle?’

He said ‘That’s good criteria.’

When it came time for me to leave. I had already about six months worth of business set up. I was still worried by the way. What happens when the six months are up? How am I going to pay the phone bills? Things like that.

And the day before I was leaving my boss brought me in and said ‘You’re really going to do this aren’t you?’

I said ‘Yep.’

He said ‘I give you a lot of credit.’

I said ‘Listen, I’m scared as all hell, I don’t mind telling you this.’

And he said ‘That’s OK. I didn’t want to tell you this ahead of time because I wanted to make sure that you were making the right decision for yourself – I want to give you a one year warranty.’

‘What does that mean?’

‘Listen, I know guys that have gone out there, they started their own businesses, they found that they made a mistake. If you find out in the following year that you made a mistake, just ring me up and I’m going to let you come back. I’m not even going to ask you what happened. I’ll bring you back no problems – Like you never left the company.’

And I thought ‘How could I miss on this one?’

And then he said ‘Do you have business lined up?’

I said ‘Yeah – I have about six month’s work lined up.’

He said ‘Good. I want to be your first big customer. I want to give you a one-year contract and get you back doing our training.’

‘Actually, make it two years.’

And then I started thinking again ‘Wow this is really great. Had I known this, I would have left sooner.’

Then he said ‘I know. That’s why I didn’t tell you.’

Michael : Just going back – You talked about networking. What specifically were some of the things that you did as you were networking? Because you’re saying that this is key and I’m fascinated to know what that actually means to you.

John : This goes along with what I was just saying actually.

So it goes like this – So I leave. Now, I didn’t do anything. I know that sounds crazy, but I personally didn’t do anything to do the networking. I had people that already knew that I was leaving, that liked me and appreciated the work I was doing and everything else.

So on my first day I had left the company, and now I have another two or three years work with the company that I had just left, I had six months work with business; I’m sitting pretty.

I’m smiling like a Cheshire cat.

And my telephone rings on my first day and it’s a friend of mine that I had worked with before.

He said ‘How are you doing on your first day?’

I said ‘Good.’

He said ‘What are you doing tomorrow? Would you like to go out for lunch?’

I said ‘I’m busy.’ Which wasn’t true. I wasn’t going to be busy for a couple of weeks, but I was taught to say that.

And he said ‘I was at the same seminar that you were at. You’re not busy tomorrow. How about we have lunch?’

I said ‘Personal or business?’

He said business, I said OK.

And he said ‘I knew that you were leaving so I wanted to help you out. I didn’t know if you had business lined up, and I didn’t want to bug you, and I didn’t want to encourage you.’

They all said the same thing, interestingly enough.

‘I wanted to find out whether you were actually going to do it.’ Which I thought was a really interesting response considering I had it from two people already, now I had it from three.

and she said to me ‘Listen, I put aside Eighty Thousand dollars in my budget for you this year.’

And I was like ‘Oh boy. Wow. This is great.’

Now the funny thing is that I got a call two days after that from another guy that I had worked for a while back. And he was out there, he knew I was leaving – He called two days later and said the same thing except it wasn’t Eighty thousand it was Fifty thousand. That’s a lot of money for a contract.

He said ‘I knew that you were leaving. I thought that I would be able to help you out now that you’re on your own. I love what you do and we can use you. And by the way I’ve put aside fifty thousand in my budget for you to come and set up some dates.’

So I didn’t really do anything. I started on my first day by – people ask me if I make cold calls or you know, canvasing – I said ‘I made two calls. On my first day in my office, I made two calls. That was it.’

And I qualified people when I called them. After the first two calls I said ‘This is not for John. This is not going to work for me.’ And I would qualify people instead of getting to the make decision.

Part of your reputation is really going to be important. I did not build it this way when I first started. I did not plan it this way. So when I go back and think about what the element of it were it’s that :

Number one, I was consistent. Number two, people knew that I delivered the goods. Number three I would deliver more than I promised anyway.

And number Four the people would be happy, they would get some skills and the business would start to run better.

So all of those things I believe, contribute to people calling me and saying ‘I’m interested. I know what you do, I’ve heard a lot about you – I’m not sure if we want to use you yet, but we want to talk to you about a few things.’

So I didn’t have to be so proactive about the networking thing, but even though I didn’t have to be I still did some other activities like –

In anybodies local area there are loads of non-profit organizations – The women’s clubs, the men’s clubs, the rotary clubs – I don’t know what you have in different countries, what they’re called.

They’re all the business clubs. The young presidents clubs. They’re always looking for speakers. They’re always looking for someone to do the lunchtime speaking event, or evening speaking event – because they all have a monthly meeting.

They don’t pay very much, but then again, you don’t even have to charge very much. I never took the money.

They said ‘How much do you charge?’ and I’d say ‘How much do you pay?’

And they’d say ‘Well to tell you the truth we’re a non-profit organisation. We have a few bucks, but the most that we could pay you is about five hundred dollars.’

And I’d say ‘I want you to take the five hundred dollars and keep it in your kitty; keep it in the bank. And what I want in return is I get every body’s business card who is at the meeting – If you want to share your database so that I can mail to them and I also want a reference letter from you telling everyone how great I am. And if you’re not willing to do that because I did a lousy job let me know.’

So those were the things that I was able to do to build a portfolio. If I did anything to network it was more about getting my name out there. And that was in the local area – That was only in New Jersey.

The other thing is to contact people. Just call a business up and let them know. Say ‘This is what I do…’ and let them know if they have people that they’d like to be contacting – contact them on their behalf.

Michael : Looking at a business starting out – If you had to predict whether a business would succeed or thrive in today’s climate, what would you look for?

John : Well first I would want to know what the skill level is of all the different functions in the business. In other words can they do accounting – You have to be a chef, cook and bottle washer in your own business.

And then there are a couple of concepts and I want to find out whether they understand this. When you’re marketing you’re not making money and when making money you’re not marketing. So where’s the balance?

You understand this, you’re doing this yourself. So when you’re out there advertising yourself you’re not making money. But do people understand this as a concept?

What I find, and mostly in NLP I should say, but I know that it can happen in a lot of other businesses, is if people think that if they say ‘Here, I have this business’ that people are going to come flocking to their door, but this isn’t true. They still have to do some marketing, of course.

And get their name out there so people become familiar with them. But a couple of important factors that we’ve always lived by – and I say we as in my wife and I – We’re the only two in our business by the way. People think that we have forty people working for us – We don’t.

Number one – We respond within twenty four hours to all messages or emails. If somebody doesn’t get a call back, or email back from us within twenty four hours something is wrong. Either the phone system is down, the electricity is down or the internet’s dead. Other than that they’re going to get a response from us.

So that’s number one. The other one – I cannot overemphasize this, is credibility based on consistency in the marketplace. And let me tell you what I think the challenge is today – It’s not the same as it was years ago, but it is true today.

I know people that have been struggling to get their business going for years. They’re really grappling along from the get-go. The reason that this is happening is because they’re changing their email address quicker than they change their underwear.

They also don’t stay in one location. They start out in Washington DC someplace, three months later they’re in Alexandra Virginia and San Diego California three months later.

There’s nothing that’s constant. They change their phone number. It’s almost as if somebody is chasing them so they have to keep moving around. That’s my idea : Why would you keep changing all of your contacts? It’s almost like you don’t want people contacting you.

And consistency in the marketplace is to me, the single greatest contributor to their success as far as I know.

It’s consistency, consistency, consistency. I’m not saying that you can’t wait a little bit, or that you can’t reformulate some things. I know people that keep changing their marketing, changing what they’re doing.

Sometimes they market that they’re the jack of all trades. And the money, really, for people that are going into business on their own is in the niche.

Michael : How would you suggest, particularly today if they were starting out – How would you suggest they approach pricing?

John : Pricing has always been an interesting thing. I personally think that if I was starting a whole new business I would first find out what’s the median for pricing.

Now depending on what it is. The seminar business is one thing – Consulting is something different.

We have pretty much kept our pricing consistent over the years. We haven’t really raised it very much – maybe a little here and there. But I think that if I were starting out I would want to look at what’s the median, and what’s the high. I want to know who’s charging the high.

I also want to know what is the response that they’re getting to that number.

It’s an interesting thing that people will advertise a very high price as if they’re delivering high quality, but then they’ll negotiate the price. But that’s not advertised.

So I always like to charge above what I think the market is paying and when it comes to consulting I’m not unabashed by saying ‘charge what the market will bear.’

Now, that doesn’t mean that you can be overly greedy, but what is it that you’re delivering? If you’re delivering goods that no-one else can deliver, if you’re delivering services that no-one else has – And most people don’t think about it that way.

So I think about it like this. If somebody brings me in and they want to hire me as a consultant they’ll pay me for my brainpower. I do a lot of NLP things – A lot of people do NLP things. I don’t just do NLP things I have ways of applying NLP in other environments.

My business background alone probably has more of a repertoire than most other people’s. I don’t just do sales and marketing, I do manufacturing and operations. I help the companies to use their employees to make decisions, to participate in management.

So those kind of things enable me to be in a niche, and to charge – to base my rates on – whatever I think that the market will bear.

People definitely equate quality with price unless it’s ridiculous. And I saw another thing that said that customers come because they’re invited. They stay because they’re treated.

High prices are only an inducement. Quality and customer service is why they stay.

So people aren’t afraid to pay more money to be treated right and for quality. So when people drop their prices for example, that’s only an inducement for the other person. It doesn’t mean that they’re going to be delivered quality.

I’m yet to find someone with low-wall pricing that can deliver quality and they don’t last long in the marketplace. Even if they’re sustained in the marketplace, it’s only because they have to go to a new market. Maybe they’re training in Indonesia somewhere.

And people that go for the low-wall price go there because they’re fooled, and once they go to that new market they’re realize that they’re not getting the quality. Then they’ll go over to Singapore. Or they go over to the Middle East for example.

I’ve had a lot of people that have approached us and have wanted to bring us to do other things in other countries and have said ‘Here’s the price we’d like to pay because this is what everyone else is charging.’

‘Well I’m not everybody else, so thankyou but no thankyou.’

And typically they’d come back two or three years later and go ‘Well gosh you were right.’

I think that it’s fair enough to charge a fair price even if it’s a little high.

I do like to tell a brief introduction to this. I was on my very first official sales call and I was leaving my house and my wife asked how much I was going to charge and I said ‘Well, I don’t know.’

She said ‘Well, you can’t leave the house until you have a price in your mind.’

So I did. I started thinking about a friend of mine. His name is Charlie, even though I use that name a lot, and Charlie at the time was charging six hundred dollars a day, which was pretty good in the early Eighties – So I said that I would charge six hundred dollars a day.

She said ‘Ok good.’

I had an hour’s drive to this office. I started with six hundred dollars, and by the time I got to this place – Are you ready for this? I doubled my salary.

I talked myself into charging twelve hundred a day by the time I got into the office to find this person. I get upstairs and I find this person in a meeting.

The secretary said ‘I’m really sorry, he got tied up in this meeting. You’ll just have to wait, if you don’t mind.’

And in my mind I went to fourteen hundred a day because I thought ‘I’m not waiting for free.’

In my head I was up to fourteen hundred. By the time I got into his office he said that he’d give me a shot for one day. He said that he had a lot of business here – What my rate?

And I don’t even know what made me do this. I said ‘Fifteen hundred a day.’

Now my friend Charlie by the way has a PHD. He’s really exquisite. I’ve been to some of his things.

I went from six hundred to fifteen hundred in an hour.

And I said to the guy ‘Fifteen hundred a day.’ and he looked at me and said ‘That’s all?’

I’ve got to tell you Michael, I’m not the brightest candle on the cake at certain things, but I’m not that slow either.

So I said to him : “That’s for the first time that you use me. It’s like an audition.”

He said to me “How much is it after that?”

I don’t even know where I got the numbers from.

I said “Twenty-five hundred a day.”

And I thought that he was going to say “That’s a lot of money.” but he said:

“That’s better. That’s what the really good consultants are charging these days.”

And this was back in the early Eighties. I thought that maybe I should tell Charlie that he should charge more money, and I did by the way, I did tell Charlie.

Charlie said to me ‘I want to increase my enrolements’ because he was doing these very private seminars, open to the general public but focused on the companies that he was working with. Very private seminars – I think that it was no more than eight people. Very personal, very good seminar.

He said ‘I want to be able to increase my business.’

I say ‘How far are you booked in advance?’

‘Probably six months in advance.’

‘That’s not so bad.’

‘Yeah but I’d feel more comfortable nine months in advance.’

‘Charlie, raise your prices.’

And he did.

He said ‘La Valle, you’re crazy.’

I said ‘Listen, you charge nine hundred dollars for the whole seminar. I think that you should go to fifteen hundred and see what happens.’

He said ‘You’re crazy.’

‘I know. I know I’m crazy. But try it out. What have you got to lose?’

He tried it out and he began booking out nine, ten months in advance. Then he called me up and said ‘It’s really working – What do you think that I should do now?’

I said ‘Raise it again. Just a little bit. Raise it again and find out!’

And he raised it again and he booked out a year in advance.

Now can I explain that? No I can’t explain it. I just know that it works.

Michael : OK. Taking what you’ve said. Is there anything else that you think is important for anybody that is starting business of this ilk to think about?

You’ve talked about networking, you’ve talked about pricing, we’ve talked about consistency – Is there anything else that you would like either to emphasise or to add?

John : I think that there is a couple of important things for them personally. They have to know themselves. They have to know themselves really, really well. They have to know what they’re able to do and what they’re not able to do.

And don’t promise something that you really can’t do. It’s OK to be proud of what you’re able to do and say ‘I can do this.’ But I find that too many people jump on the opportunity to get business, which, to me, is not the right thing to do.

I’d much rather look at the availability of continuing business.

I had a president that I had worked for in the company, and we were talking about profit onetime. And he said to me ‘What’s profit?’

‘Well, it’s how much money that you can make.’

He goes ‘Yeah, that’s the accounting term. But to you, what is the philosophy or concept of making profit?’

I said ‘Well. I dunno. To make a lot of money and be able to buy a red (I don’t speak car.)?’

He said ‘No. Profit is determines your ability to determine your future. Plain and simple.’

So I thought : What does that mean?

For people who are thinking about going into their own business;

Number one – Don’t borrow money for intangibles. A lot of people want to borrow money to start their business. If you’re in a position where you have to borrow, to take a bank loan out, my suggestion is to have enough money in the bank first.

I’ve known people who have borrowed money, taken out loans for advertising. That’s a very bad idea. That to me has got to be one of the worst ideas – Why owe money for advertising?

Because advertising is a gamble. Unless you’ve tested it, or you’ve got proven markets – but if that’s the case you’re already making the money.

So we’ve never, ever taken out a loan. If you have to buy a computer, a copy machine, those things – Well, if you have to take out a business loan to do that I could kind of understand it.

But my idea is that you have got to be financially independent enough already to do this.

They really have to know themselves and what they’re abl