How To Collab With Your Competition

What if your biggest competitor could be your greatest ally? This week, Michael is joined by Liselle Regueiro DeGrave of DeGrave Communications and Rachel Dickman of RMG Communications, two PR firm owners who have thrown out the traditional rulebook. Instead of merging or competing, they operate under a unique model they call “collabetition,” running their own successful firms while strategically collaborating on major projects. They share their individual journeys from the burnout of corporate and government work to the freedom of entrepreneurship, and how a decade-long professional relationship built on trust became the foundation for their innovative partnership.

Liselle and Rachel get into the nuts and bolts of how they make this unconventional model work. They reveal that by maintaining separate companies, they lower their financial risk and retain their unique brand identities, all while presenting a united, more powerful front to clients. This approach transforms the high-stakes, often cutthroat, world of government RFPs into a win-win scenario. They detail their process for jointly evaluating opportunities, leveraging their combined networks, and sharing costs and profits, proving that true collaboration can create a pie big enough for everyone. They also discuss the nuances of value-based pricing, navigating complex hiring laws like California’s AB5, and the critical importance of outsourcing to reclaim time and focus on growth.

In this episode you will learn:

• The “collabetition” model for flexible, low-risk growth.

• The key to making business collaborations work.

• How to structure joint proposals and share profits.

• How to qualify government contracts and avoid wasting time.

• How to price for value, not just billable hours.

• Navigating tricky hiring laws (like CA’s AB5) when scaling.

• Why outsourcing is crucial for buying back your time.

Welcome to the Consulting Success podcast. I’m your host Michael Zipursky, and in this podcast, we’re going to dive deep into the world of elite consultants where you’re going to learn the strategies, tactics and mindset to grow a highly profitable and successful consulting business.

Before we dive into today’s episode. Are you ready to grow and take your consulting business to the next level? Many of the clients that we work with started as podcast listeners just like you, and a consistent theme they have shared with us is that they wished they had reached out sooner about our Clarity Coaching Program rather than waiting for that perfect time. If you’re interested in learning more about how we help consultants just like you, we’re offering a free, no pressure growth session call. On this call, we’re going to dive deep into your goals, challenges and situation and outline a plan that is tailor made just for you. We will also help you identify where you may be making costly and time consuming mistakes to ensure you’re benefiting from the proven methods and strategies to grow your consulting business.

So don’t wait years to find clarity. If you’re committed and serious about reaching a new level of success in your consulting business, go ahead and schedule your free growth session. Get in touch today. Just visit Consulting Success – Grow to book your free call today.

Liselle Regueiro DeGrave is the President and Owner of DeGrave Communications. With nearly 20 years of experience blending in-house and agency expertise, she leads her integrated team to deliver impactful communications and marketing strategies for clients across California. A self-taught entrepreneur, Liselle founded her firm in college and has scaled it into a thriving business. With Rachel, she co-hosts the award-winning PRessing On Podcast.

Rachel Dickman is the Founder and CEO of RMG Communications and a nationally recognized leader in public relations. With over two decades of experience, she helps public sector clients transform their communities through award-winning campaigns. Her work has earned numerous honors, including a PRSA National Bronze Anvil and a Lifetime Achievement Award. Rachel co-hosts the popular PRessing On Podcast with Liselle.

Connect with Liselle Regueiro DeGrave
Discover more about DeGrave Communications
Connect with Rachel Dickman
Discover more about RMG Communications

Alright, Liselle and Rachel, welcome. How are you both doing today?

Great, thanks. Thanks for having us.

Yeah. So, as we talked about just before I hit record, this is the first time that I can think of that I’ve done an interview live with two partners. We’ve had many consulting business owners or professional services firm owners who have partners, but typically it’s been one kind of representing the firm. But I have the pleasure of having both of you on. So I thought a great place for us to start would just be, how did you even get to the point of deciding that you want to kind of come together and start this, this firm? Just give us a bit of background on how that came to be.

Sure. Well, I’ll get started because I actually opened my business before Rachel’s did. And so just to give you a quick snippet, Rachel and I both work separate. We run two separate public relations firms, but instead of competing with each other, we have decided to collaborate in an endeavor we call “collabetition”: collaborating with the competition.

But I actually started my business when I was back in college. I was taking public relations classes, and I was like, “Oh, I know what I’m doing. I’m just going to get an EIN number and get my business going.” And I quickly realized that I didn’t know the, you know, I didn’t know anything about running a business, and I really didn’t, I hadn’t honed my PR craft yet. And so I graduated college, I went to work for a big international PR firm, got a lot of experience, got very burnt out, and I transitioned into the government sector, which the majority of our clients are public agencies. That’s actually where I met Rachel, at one of the public agencies that I worked with. And from there I just slowly, I was working part-time and, you know, taking care of my family and just juggling all the things that, you know, moms usually have to do.

And I slowly kept building my business until I was at the point where it was like, “Okay, I am, I’m ready and I can leave and I can go out on my own.” I started to grow my business, and then I’ll let Rachel kind of take it from here and tell how she went out on her own and then how we kind of joined forces, and it makes it so much more fun to- I think a lot of times as a business owner, when you’re starting something from scratch or you’re doing it by yourself, it can feel very siloed. And so having Rachel, we’re really like-minded. We have similar work ethics and we balance each other out because we have different strengths and weaknesses. It just, it makes it that much more fun, more enjoyable, and I think honestly more successful than if I was trying to do it on my own.

[02:46] Shifting From Government Work to Independent PR Firms

All right, so Rachel, let’s hear from your side. Give us your story.

Yeah. And mine is a little different than Liselle’s. I went to school, studied communications at UCLA, and really thought I was going to do entertainment PR and marketing. Did an internship in that, did not like it, ended up coming back home. At the time, home was the High Desert, about an hour away from Los Angeles. And I was like, “What do I do next?” I was applying for jobs and I was picked up by a local city up there and started working in their communications department. And the rest is really history.

I ended up working for four different public agencies. And as Liselle said, we met at a large utility when we were both there. I think we were both there for roughly five to seven years and our time overlapped. And one day she said she was going out on her own and she already had locked in a client. And now it’s kind of laughable, but at the time it seemed like such a big contract. She’s like, “Rachel, I’m leaving and I have a $20,000 contract.” And, you know, you don’t think about it. To me, I’m like, “Wow, 20,000. If you just do that a few times, I’m really replacing my salary at the utility agency.” But there’s so much more, as we know, that goes into that. There’s the overhead, there’s utilities, there’s other contractors you might be working with that you’re paying for. And I stayed there for a couple more years and then I finally made the leap and went out on my own. And it was really wonderful.

Liselle and I had known each other for a long time. We have a lot of the same network, and we had a lot of the same aspirations. We wanted to, of course, focus on client work, but really also have the opportunity to have a flexible schedule, enjoy time off with our families, enjoy working on projects that really brought us joy and excitement. But then we also have those ambitions to grow our businesses in other areas, which included producing our Pressing On podcast and also writing books.

Yeah. So I have a bunch of questions for you, but I’ve got to say, I remember the days where, this is a long time ago, I was excited about just dreaming of, “Imagine if I could make $3,000 a month with a business that was online so I could kind of live and work and travel and, you know, all that kind of stuff.” It’s funny how that stuff changes over the years as your business grows.

[04:57] Benefits of Keeping Separate Businesses While Collaborating

One big question that I think a lot of people are probably wondering about, I know I certainly am, you mentioned when we started the conversation today that you both run your own companies, but you collaborate. And that sounds pretty counterintuitive. It sounds like, why would you do that? Why would you not just combine one business? You know, isn’t two together stronger than two separate kind of together? Can you just explain how you both think about that and why the decision to keep your businesses separate and work together, not just combine and build one company together?

Yeah, that’s a great question. And I think for both of us, and this is in any business, you hone your craft, but then the business side of things, it’s a completely separate beast. Right? So I think we both enjoy having our own businesses. We have very unique- our brands are very different. And I think it’s because individually we’re different people, right? I see it one as lower risk if something happened and one day Rachel and I were like, “You know, this isn’t really working out.” It’s not like we’d have to dissolve a corporation. We are both running our own corporations. They’re separate. For the most part, we found that we share the profits on all of the projects that we work on. Sometimes there’s work- I might bring in a client and Rachel doesn’t touch it, but that’s our agreement, and it seems to work out, and vice versa.

One of the benefits I think also of keeping, you know, just keeping things separate is that if, you know, in the future, I just say, “You know what? I’m kind of throwing in the towel. I don’t want to do PR anymore. I don’t want to run this business.” It doesn’t necessarily have to impact Rachel’s bottom line or her business, and she can keep it going. She could say, “Hey, I’m planning on selling in five years.” And so I think there are a lot of benefits of keeping it separate. But we, I think it’s, you have to, it only works if you’re doing it with the right person and you really have to have- Rachel and I knew each other for almost 10 years. And it’s funny because when we were working together internally, we always joked, “Okay, when we’re 40, we’re going to start our own PR firm.” Well, I already kind of, I did have my own PR firm, but in the same note, it was like, “Well, I’m not going to just give her my company.” Right? And so I think we become very kind of, you know, we’re proud of what we’ve built up. And so, yeah, it’s just kind of an interesting setup, and I don’t know that it would work with anybody else.

Can you clarify how you actually structure that? So, you mentioned that let’s say that Rachel, you bring in a piece of business, and so, you know, 100% of the business development, the sales, the marketing to land that client, let’s say, came from you. How do you divvy that up? How does that work? Because I think people are wondering like that, that sounds like it could get kind of complex. You probably have made it rather simple. Is it, it’s still shared 50/50, or how do you guys approach that? It’d be great if you could break that down.

[08:11] Structuring Profits and Proposals in a Shared Model

Absolutely. And I wanted to take a step back in clarification, too, really quickly. Another reason that the businesses are separate is Liselle is a 51% owner and her husband has 49% of the business. That was set up before I even went out on my own, so that was one of the considerations as well in addition.

As far as the setup, yes, so if we’re having to do any marketing or business promotion or any kind of RFPs, those take a lot of time, for instance, and there’s a lot of cost that oftentimes goes into those, we’ll go ahead and split that regardless of if we get the client or not. And that’s just a cost of doing business. If we were both our own corporation, we’d be absorbing that as well. And it’s worked so far. But again, I really want to point out, too, it goes back, whether you’re doing it in the way we do it as a collaboration, or if you’re going into business to start a corporation with a friend or a colleague, you really need to know that person, make sure you’re on the same page, make sure that legally, if possible, that everything’s set up. I’ve seen so many things go bad where people end up losing a lot of money; they destroy relationships because a lot of stuff isn’t thought through.

And also, too, you have to have that same business vision, whatever that is, and those common goals as the person you’re going to be working with, otherwise it’s not going to work.

Yeah. And just to kind of go a little bit more into detail because I know you’re, for your listeners, you’re wondering, how does it—

We like details. We like details.

So, the majority of our work either comes from existing relationships, we try to, you know, we build the relationship with our clients. We do good work and they come back to us. But the, you know, the ‘ick’ part about working with public agencies is that request for proposal. And so a lot of times we’re having to do these 90-page proposals with our past performances and, you know, who we are, who’s our, you know, all the who are the team that will be working with the client.

And so the first step that we always take, you know, I might see an RFP, maybe someone in our industry sends something and says, you know, like our research partner, “Hey, we saw this and we thought you guys would be a good match.” Everyone kind of knows that we are a tag team, and so we’ll get it from both sides, you know, like, “Hey, Rachel, Liselle, you guys might be interested in this.” And then we’ll look that over and one, you know, we’re strategic. We can’t go after every proposal that comes through. Time is money. And so we one, we look at it, “Hey, do you know somebody internally, Rachel? Do I know somebody?” And so that’s kind of one of the first determining factors whether- because this is the other advantage also, like you said, why do you do it together? If we were completely separate, we would be bidding against each other all the time, right? Because a lot of these projects, we’re in the same networks, like Rachel said, and so this way it’s like, “Hey, if we’re going to go for it, why don’t we go for it and we both get a piece of the pie.” And so we kind of evaluate it. Do we know somebody internally? Do we have, does RMG have, say we don’t know anybody, but we’re like, “Gosh, we are the ones for this job. We would kill it. We have the portfolio.” Which of our firms has more, has maybe more samples that we can show? And so kind of being strategic in that sense of first, which firm is going to be bidding on it? And like Rachel said, then we go in it together. Like we’re both working on the proposal, our design costs, anything that any costs that might be going into that, we just in the end, she’ll invoice me or I’ll invoice her for 50% of the cost.

So, and then when we get the client, you know, it’s going to either be under RMG Communications or DeGrave Communications. Our firms both are insured. We have the same level of insurance. And so, you know, again, that kind of balances it out. Working with public agencies, they all kind of ask for the same coverage, which keeps feeling like it’s getting higher and higher. But that’s pretty much how we run it. We have, we just, we have a team where there’s overlap. And so we have some folks that work for her team as well as my team. And we just, like Rachel said, it really comes down to having the same goals and really the same values. And I think it’s doable. And you have to talk about stuff. And sometimes, you know, not so nice things, or sometimes we just say, “Yeah, let’s not bid on that.” And a lot of times we’re in sync and we’re feeling the same thing. So that’s where we’re like, “Yeah, let’s not bid on it. It doesn’t feel right.”

[12:52] Navigating the Complex Public Sector RFP Process

It sounds like the majority of your business, and correct me if I’m wrong on this, is public sector through RFPs. Are there other ways that you guys get business for your companies right now? Are you actively marketing and selling, or is the main focus finding the RFP opportunities and going after them? Just break down what that looks like in terms of the percentage of where the revenue comes from or what your activities look like.

Yes, I would say it’s a mix of everything, really. As Liselle put out, the RFPs take a lot of time in the process to create them, and oftentimes you have to be really selective. If they’re already working with a certain firm and they’re just having to put out an RFP because, oh, three years have passed, you’re probably not going to get it. So on top of that, there are other ways to work with government, depending on the level of government. So at the local level, where we do a lot of our work, there’s opportunities to, depending on the agency, some of them have higher thresholds, under 30,000, you don’t have to do an RFP; you could just get three informal estimates, or you don’t even have to do that sometimes, and they can just work with us. So it all depends. We try whenever possible to not do the RFP process, especially when it’s an agency that we have no ties to because nine out of 10 times we don’t get it. I know Liselle actually just got one that we had never worked with before. It was just, I don’t know, somehow we were on some bid board and we both got the notice that this agency was looking for on-call communications. But kind of after looking at where it was located, it’s in the region where Liselle’s firm does a lot of work, so it made more sense for it to go under there.

So what are you guys actually doing then to win, I shouldn’t say to win that business, but let’s say to find that business? Is the focus identifying opportunities that are already out there or will soon be out there, or are you doing speaking, podcasts? If you were to break down the channels of what you feel or what you know is actually bringing you the most opportunities, how would you rank them from top two, let’s just say top three or four channels and activities that are helping you to grow the business?

[15:08] Leveraging Relationships and Referrals to Win Government Contracts

I think number one, and Liselle, then you can take over, I feel for us it’s our network. We have a really strong network that we’ve been building for decades, so oftentimes, even if something’s arising to an RFP level at an agency, we get notice from a person at that agency and they’re like, “Hey, we really want you to apply for this,” or a referral. Someone says, we just got one the other day, “Hey, so-and-so said you were incredible to work with and you would be great on this project.” So you already kind of have an in that way. And Liselle, I don’t know if there were any other ways you wanted to cover off on for that.

Yeah, Rachel really hit the nail on the head. We’re just, as established businesses, people know us. I know Rachel has been over the years really involved, for example, in the professional organization, the CAPIO, the California Association of Public Information Officials. They’re actually also a client of hers, so she helps with all their programming. But building that network is huge. We’ve both served as board members for the Public Relations Society of America. Yesterday evening, I actually got an email from someone that works at a local city, and he said, “Hey, such-and-such county is going to be putting out an RFP. I think you’d be great for it. I’m CCing this person on there.” And already, just this morning, she said, “Hey, can I schedule a call with you?”

And so building that network will make the RFP process so much more palatable because you see it come out and there’s a lot. You got to do your research. One of the things we always like to ask, and this might be insightful for your listeners that are trying to get into government contracting, is just when they have a Q&A opportunity, before you even invest any time or money, just ask, “Is there an incumbent on this project?”

And are you satisfied with their work?

Yes, because sometimes that’s why they’re flying something. And if you can even find out, “Are you happy with the performance of that consultant?” you’re going to save yourself a lot of headache. “Yes, this is who we work with, or no, we’re just going out to bid and we want to know what’s out there and who can help us.”

I do try to be as involved in my local chamber as much as I am able to. We work with small businesses as well, but what we have found is a lot of times small businesses don’t always have the budgets necessarily to do what we think would be most effective for them. And so we want to make sure, we want to be thoughtful of that. We don’t want to take advantage of a business.

And so there have been actually several businesses this year, we had one, for example, that had received this amazing achievement, and they found me on a search. They found DeGrave and said, “Hey,” they were, I know we talked about, I live out in wine country, Temecula, in California. It was connected to the wine country. They had interviewed an LA and Orange County firm, and then when they talked to me, they said, “You really understand this community. You really understand what the Temecula wine country is all about.” And so they ended up selecting our firm and we were able to work with them on a media relations project. And that was one where I felt like they were going to get value out of the work that we were going to give them.

So, yeah, I mean, it’s really, it’s just kind of being out there building relationships. We do get work, like I said, from a search from time to time, so you want to make sure that your SEO is up to date.

[18:44] Positioning for Federal Work Amid Budget Cuts

Let me ask you, let me ask you to change the topic for a second because this is very timely with what’s happening in the world right now. So, you know, the President of the U.S., Trump, is in. I think anyone who’s been paying any attention to news has been seeing that there’s been some very significant cuts in government spending across, you know, public organizations, federal departments, and so forth. How- is that impacting your marketplace? If so, any changes, anything that you both are doing for your companies as well as anything that you’re talking to your clients about? This may be different by the time this airs, but I think for a lot of people it’s very top-of-mind currently.

Yeah, I’m actually happy to take the lead on this one. Ironically, at the end of 2024, our firm became a certified GSA consultant, so we are actually set up to work with the federal government, the U.S. federal government. And then come, you know, January, you’re seeing all these budget cuts that are, you know, GSA, USAID, and we haven’t completely, you know, put our foot in and actually bid on anything, but we are eligible, which is a huge, you know, that is an accomplishment in itself. It took about a year-long process to become a registered GSA consultant. And we’ve been watching all this come out. To be honest, I have confidence in the work that we do that if we were doing work on a federal contract, I would hope that it would be valuable to the government and it wouldn’t be something that would be necessarily cut. You never know; a lot of times comms are the first to be cut.

But you haven’t seen an impact so far in terms of number of opportunities or RFPs or anything like that that’s causing you any concern or to change your approach or strategy in any way at this point, is that correct?

I actually, at the local level, and now mind you, most of the work we do now is at the local level, after January 1st, the dams burst open. There were so many RFPs coming out. There were so many people that I think were just waiting with the uncertainty of just having a new changeover happening and they weren’t sure what to expect. And at that level, I haven’t seen it.

And I think the other thing too that we do a lot of is things that, you know, it’s not an optional. We live in, well, we do a lot of services in California for agencies. There’s a lot of concerns over water, the drought, and that’s a needed service. And we do a lot of fire prevention outreach and other things that are really of value to the community. So I agree with Liselle. Hopefully, I mean, it’s always a tough decision when you’re making cuts, but at this point, we haven’t seen anything at the local level. So it will be interesting, like you said, Michael, to see what happens after a few months, even in June perhaps, what it’s looking like.

[21:50] Setting Competitive and Transparent Pricing Structures

And how do you all approach pricing? You know, is your standard time and materials, right, hourly basis? Is it more a project-based rate? Can you just talk through how, and is it the same for both of your companies? Do you take a bit of a different approach? Just walk us through how you structure pricing and overlay that on top of, if a lot of your business is at the local level or with the public sector, what influence or impact does that have on your pricing?

Well, pricing, there are different ways you can do it if you’re a consultant, and there’s a flat fee you can charge, there is going to be—

What do you guys charge? How do you approach it?

I don’t mean to sound wishy-washy, but there are some services, for instance, we do a lot of branding guidelines for public agencies and those are more of, you know, we already have somewhat of a template, so we do a flat fee for those. And then they already know upfront what’s included, and then if there’s any extras, we usually, you know, we can accommodate that. But then on some others, especially when you’re going after the RFPs, they ask you for hourly rates if it’s on-call. So that’s when you do have to include those hourly rates, and they don’t oftentimes give you an option for a flat fee. You can put it in, but they’re still very, they’re still very stringent about wanting those hourly rates.

Right. Have you ever found or had any pushback or issues or concerns when you’re working with the public sector around your rates? For example, a big one for many consultants is they want to shift away from working on an hourly basis because they’re essentially trading time for money. The only way to really scale hourly rates is to work more. And so for most people, that means hiring more people and building your team so you can bill more rather than just doing that as a small or, let’s say, an individual. So that can be a challenge if you’re working with the public sector and they’re requiring you to put an hourly fee. Has that been an issue for you guys? How do you think about it? How have you maybe worked around that with the concept or idea of growing the business, but yet you have, in some ways, maybe potentially something that could hold you back or a bit of a ceiling?

Yeah, we haven’t really experienced that with our clients. Like Rachel said, a lot of times they want to see what your hourly rate is. To answer one of your initial questions, we both charge the same. And actually, even at the more senior level, we charge our clients a blended rate for that, you know, President/Comms Manager type of role. And it’s a- we do feel like we have a very competitive rate. We know what it should be for our market, and it’s not at the very top, it’s not in the bottom. I think we’re priced really competitively.

We do from time to time, you know, you bid on a project. Another insight, we always ask for that debrief after if we don’t get it. I joke, back in the old days when you would get a paper letter telling you, “Oh, apologies, you didn’t get this one.” I actually have a folder of my rejection letters because I like looking at those and then seeing the growth of the company and just being like, “Wow, I forgot I even bid on that.” But look, it didn’t work out and things are still going well. But kind of finding out that debrief, there have been certain projects where we’ve bid on them and they’ve said, “You know, you were higher than the other consultant.” That could be for various reasons. Sometimes the scope is not always really clearly defined in those, so maybe we thought it was going to be more work than really what they wanted from us, and the cost ends up being higher.

On the back end, I remember there was one conversation specifically on a debrief where I knew the consultant that had gotten the project and they said, “You know, you were higher.” And I said, “That’s- I completely get that. We’re not trying to be the cheapest. We do provide quality work. But if you’re going for just the lowest cost, that might not be us, and we’re not maybe the best fit for your organization.” But one of the things that I knew about the competitor was that they like to go in really cheap and lowball, but then what they love to do is change order after change order. And so I actually brought that up at the debrief, not to slight the consultant that they did select, but just to share, “You know what, this is our fixed firm price. We don’t like to nickel-and-dime our clients. We’re going to get it done as long as the scope of work, you know, for the most part remains the same. We don’t like to go ask for change orders because we know that you don’t want to have to ask for change orders.” So, again, just kind of knowing your market, who are your competitors.

But on the pricing side, like Rachel said, there are some things we will kind of look at it because as a business owner, you become a subject matter expert in whatever you’re selling, right? And so we know a lot about water quality. We do a lot of water quality reports. You know, if they’re doing rate increases, things like that, we know that. And so we have to put into consideration that something may take an hour of time, but we have put hours into getting to that point. And so that’s where I think competitively as a business owner and strategically and trying to scale, you have to charge. There has to be a cost to that. And so that’s where you kind of do those flat rate fees to really—

[27:32] Charging for Value Instead of Hours Worked

Are you saying that when the government entity might require you to provide an hourly fee, you don’t necessarily always end up using the hourly fee? You might still shift that to a project-based fee once things move forward? I’m just kind of wondering because you mentioned a really interesting point right now, which I think will resonate with a lot of people, that something might just take you an hour or two, but the reason that you could do it in an hour or two is because you’ve done it so many times before. So somebody newer, it might take them 10 hours, which is the challenge with hourly fees. It might take them 10 hours, but they would make more than you, right? It’d take you less time, but you’re actually better equipped to handle that because you can do it in less time, which provides a greater value for the client. So that’s kind of the challenge of hourly fees is that you have greater expertise, therefore you can do something sooner, but it means you make less money even though the client gets the results sooner. So the client gets a lot more value, pays less, and you putting all that in, end up making less. How do you guys manage that or deal with that or think about it, I guess?

Yeah, we would definitely bill, if something should take 10 hours, those are situations where they have our hourly rate, but we were probably going to be charging a flat rate for it, if that makes sense. So they can get an idea, this is about 10 hours of work, right? Even though it may only take us an hour, we’re going to be billing a flat rate. And I think the clients understand that. Like, no one would expect something that has hours put into it to only take an hour to put something together. So, and there’s always back and forth also. Nothing, nothing really gets approved in an hour, right? So it’s kind of all that back and forth too that I think has to be thought out, especially when you’re doing a flat rate.

Yeah. Okay, that makes sense. Let’s talk about your team for a minute and how you guys have the business structured. So you’re each the founders of your own businesses. Clearly you work with others at times. Can you just walk us through what the business looks like? Do you have other full-time employees? Do you just bring in contractors? What does that look like for each of the businesses and then combined when you work on projects?

[29:52] Hiring Talent While Navigating California’s AB5 Regulations

And I can start on this one. We are both businesses that are in California, and California has very, very stringent laws now through AB5 of who you can and can’t work with. So, and AB5, for those who aren’t aware, it was more when it came out for people that are more like freelance Uber drivers and Lyft, but it also takes a toll on people who are graphic designers and similar who we would normally work with and we could work with and were working with prior to this as contractors. So that was, I think, a huge change in our business, too, was we were growing, but then we also had to take into account, “Okay, we can’t work with these people because they’re not a corporation, they’re not an LLC, they’re not an S corp, they’re just a freelancer. So how do we deal with that?” So I know we’ve both been growing our team. I’m up to seven folks, some of them are part-time. I, last year, because we started getting a lot of projects with graphic design and video on our side, we have a graphic designer and videographer; it’s someone that does both roles very well. And I know Liselle, too, just to manage the growth, she just brought on a full-time graphic designer as well.

And so, just in the context of the California situation, are these people then that are not based in California? How have you both found the way to work around the new policy or regulation, if you will?

Yeah, it doesn’t have to do with where the people are located. It has to do with where your corporation is located, so you have to abide by those laws. So even though, like, let’s say I’m working with someone in Arizona, they might be a freelancer, but that doesn’t mean it’s still okay under California law. They would have to be a corporation or an LLC.

So you can’t work, just for everyone who’s not familiar with this, and I definitely have still a few things to learn, but are you saying that the law says that if you’re a corporation based in California, you’re not allowed to work with freelancers?

You can in certain areas, but if it’s something that’s directly related to your business, like for us, graphic design or writing services, you can’t. If I’m working with an accountant or, you know, something like that that’s more on the outs of your day-to-day business, you can. But yeah, it’s a very, very- go ahead, Liselle.

Yeah, the idea was it was supposed to protect these freelancers, defining, “Okay, you’re actually not a freelancer, you’re an employee.” And your employer is now responsible for the things that an employer does. But the problem is, what I have found, what we have found, is that freelancers, they like being freelancers. They don’t necessarily want to work for you as an employee. And it gets tricky for them as well because, especially if they’re only working for one person, because then it comes across like they’re your employee.

So to answer your question, Rachel and I both have actual employees that work for us, and then we do have those situations where we might have like a graphic designer or we need supplemental help and we might, we just have to make sure that they’re an LLC or an S corp and they’re not just a freelancer. We have videographers, you know, photographers, things like that, where it’s in our wheelhouse, it’s a service we provide, but we don’t do it all the time, and we’re able to work with them because of how their business is structured. So that’s actually how Rachel’s firm and my firm can work together, is we’re both corporations. So that’s a whole another technical thing as well.

But yeah, we were, you know, just in scaling the business, we were spending a lot in design. You know, in California also, it makes it difficult if somebody doesn’t work out. It’s really difficult to fire someone. There are just so many, they don’t make it easy. I’m sure you’ve heard that too if you’re just paying attention to the news: people are leaving the state, it’s hard to do business. And it’s true. It is really hard to do business, we have found. And so to hire someone like a designer where you have, I mean, easily full-time work for them, if it doesn’t work out, it’s difficult. And so we do from time to time work with different contractors, but we have to make sure that their businesses are set up correctly. And it works because if it doesn’t work out, you know, the project’s over, and then you can say goodbye, you know, and work with someone else or, you know, hire someone on your team. But we finally had to do that because I know for, I was finding that the amount of graphic design projects that we were having come through, it just wasn’t becoming profitable. It was almost like the designers were making more than we were making. And so I kept telling Rachel, “Okay, we’ve got to do this.” But we needed to find the right person and make sure that it was the right fit for the business.

Yeah. Let me ask you a question, and so this is for both, or each one of you. What’s one thing in the last year or so that you’ve changed your mind on, think differently about in the business or hiring or marketing, strategy, pricing, something you’ve changed your view on?

[35:22] Reframing Mindsets Around Hiring and Team Scaling

I would say for me, it’s on hiring. Last year, we got a very substantial contract, and that’s the one that I had to bring in the videographer/graphic designer for. And before that, I only had, I think, two employees, and they were just, they worked more with me in assistant roles, so it was very behind the scenes. And for this, this was going to be someone that would be out front managing these projects. And I really just didn’t want to- that’s one of the things I don’t miss is managing and leading teams. Like when I left the utility government world, I left that behind. And I feel like the team we had at the time was still really manageable, and I didn’t need to be like a babysitting service, and we could still do great work.

But I’ve definitely changed my mind on hiring after that person. It seemed easier. And I think too, it’s because I had been in business long enough to now have a great team behind the scenes. We don’t have an internal HR person, but we do have a company we work with that provides HR services. We do have the option for a 401(k). We already had all these things set up foundationally that it didn’t seem like it was going to be a huge lift on me because we’re still a small firm, even at seven people, I’m wearing a lot of the hats. I’m IT, I’m finance, I’m business development, I’m CEO. And that doesn’t leave a lot of time to do the rest of that. So it felt like it was an easier process now. And I feel like now when we’re bringing on people for projects, it doesn’t have that same kind of overwhelming or scary feeling to it.

Yeah. Liselle, what about you?

[36:59] Outsourcing Operations to Buy Back Founder Time

Yeah. Gosh, I don’t know if there’s been, I hate to say this, I don’t know if there’s been anything in the last year where I’ve had an ‘aha moment’. I know as a business owner, the goal for me has always been time. Like, how do you get more of your time back? How do you get more of your life back? And I think with technology nowadays, it makes it so easy for, you know, you can work from your phone, you can work from your computer. And I think it’s just constantly looking for ways, how can I get more of my time back?

And like Rachel said, having a good team behind you and offloading more so that you’re not carrying the burden of everything as a business owner. And I think we’ve both gotten better as time has gone by. Like Rachel said, we both have, you know, external HR departments, I have accountants that handle my books. And all those things just make your business run so much smoother. It gives you time back. So just looking for those opportunities where there’s been something in my business where I’m like, “Oh, I’m so glad I gave this over to somebody else to handle, and it’s been able to, you know, just free me up of time.”

Yeah, it’s one of these things that so often people kind of delay or hesitate on to work with external experts or build their team. And I think it’s very common, the mindset is I want to keep more money in my pocket, I’ll wait until I land another client or get to that next revenue level before I do that. But the point you’re making is a really important one, right? It’s about buying back your time, it’s about making time to focus on the things where you can create a lot more value inside of your business, and you can’t do that if you’re doing everything else, right? So it’s, I think that’s a great point.

[39:19] Learning More about DeGrave and RMG

Listen, guys, I want to respect the time that we have in the calendar today. I want to make sure that people can learn more about both of your companies. And so I think when I said before hitting record, let me know where people should go, but I think this is probably going to be more than one place that people should go because you each have two websites. So, Liselle, let’s just start with you for a moment. What’s the website, the address that people can go to to learn more about your company?

Yeah, so our website is degravepr.com. And Rachel and I actually share a website for our podcast called pressingonpodcast.com. So you can learn more about the podcast and our book about starting a PR firm.

All right, you took, you took the two, the two URL slots now. You took Rachel’s, I’m just joking. We’ll make it three. All right, Rachel, how about for your website? Where should people go?

Sure. Your listeners can find me at rmgcomm.com. And through any of those three websites, you can also pick up a copy of our book on how to start your own PR business. And even if you’re not looking for a PR business, it’s still a good book. We talk about proven strategies of what works and what doesn’t, practical tips to start your business from scratch, how to start a business on a budget, get clients, and so much more.

There we go. That sounds like a true PR professional. And yeah, I mean, the nice thing is that regardless of where people go, any of those places, it all kind of comes back together, right, based on your model. So thank you both for coming on here today. It’s been a fun conversation, very different than the usual, and I think your perspectives of how you’ve gone about building your business is very unique. But that’s why I was very happy to have you on the podcast here because my goal is always to help people to gain different perspectives and insights and ideas so that they can bring the best of what will work for them in terms of their own business model. So thank you again for coming on.

Thank you, Michael.

Important Links:

DeGrave Communications
RMG Communications
PRessing On Podcast
A Practical Guide to Starting Your Own PR Firm
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