United States Eventing Association

Podcast: Starting Your Own Business with Doug Payne

Doug Payne from Area II, who has recently moved to a new training barn in North Carolina, offers some helpful advice on starting your own business.

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Podcast Transcription:

Chris: This is the United States Eventing Association’s official podcast. Hello and welcome to the program. I’m Chris Stafford. Doug Payne has recently moved to a new training base in North Carolina with his wife Jess. Having established a successful business at his parent’s home in New Jersey, he joins me now to explain what it takes to set up a new business. Doug, welcome to the program.

Doug: Thank you very much Chris, it’s always a pleasure.

Chris: As I said, you obviously have new beginnings now. You’ve just written the concluding part of the article series for the magazine. So we want to talk a little bit, for the wider audience, about setting up a business because there are so many aspects to this and you have done this successfully at home before you got married, haven’t you?

Doug: Well, that’s the goal. It’s certainly a challenge and I think starting any business is a challenge and a half. I think in the equestrian world, the overhead is such that the challenges that are presented to anyone looking to get going can seem unsurmountable at first but we break it down and on we go.

Chris: I guess it depends where you start with the horses. You build up a team of horses or you start with owners or maybe you have sponsors waiting in the wings. Let’s assume that you are beginning your professional career. Let’s start with a little shopping list for people to consider. Obviously those key points at the beginning of setting up a business.

Doug: My sister and I both ride professionally now. When growing up, we were incredibly lucky to be in a family that’s very involved with horses and we both had a horse going from childhood growing up through our high school graduation. We both went to college and I think that’s a very important thing to do. I have a degree in mechanical engineering. Our deal with our parents was that they would cover the expenses of a horse up through high school and beyond that anything we did was on our dime. I think everybody is in a slightly different position. I think you’ve got to, and it’s very difficult in the beginning in your early to mid- twenties, figure out a way to differentiate yourself if is an opportunity with a horse that’s got some talent. It doesn’t even have to be a world beater but if you can go and win at training level, I think there is some huge value in that, because time in the saddle is the most important thing you can possibly try and figure out a way to get more of. The more experience you have, you can figure out how to differentiate yourself from the person down the street and hopefully you’re continuing to learn. Often times the best teachers are the horses themselves. The more you can learn and the bigger the base of experience you have, the more value you can be to potential clients.

Chris: The balance, of course is how much time you spend in the tack producing the horses and running the business and everything else that goes with it and sourcing those young horses as well. Do you have any tips for our listeners about sourcing the young horses because I know our riders will, in the beginning, ride just about anything just to get the experience.

Doug: I think there are two parts in the way I approached it early on. In the beginning, you have to get experience, get exposure and you need to be out there competing. So if there’s a horse that’s a bit tricky, I’ll spend as much time as I possibly can to get the best tune out of them and hopefully get some decent results out of them that can start to gain some attention. At the same time, in the end, you would love to be riding good quality horses that you can start from scratch or near enough. If you’ve got some space, and to me, this is the only sustainable means to have a string of horses. You’ve got to find young ones anywhere from yearling to three year olds. If you can find some that are well bred, and that’s a challenge, you can find a place to keep them that doesn’t cost all that much to keep them for a year or two just out in a field. Obviously you have to start them and get them going. Then you know you have a totally clean slate and if well-bred and they look the part, then they’re probably going to be reasonably talented. Maybe they're not the world beater but if well started and they have a good record then they’re always going to be a market if comes time. If it doesn’t reach the level you'd ideally want it to be, then it could be very useful for any number of other people.

Chris: Well, obviously riding the horses, producing the horses, to a level where they can be sold and start to generate some revenue is a priority but let’s focus on what happens when you’re out of the tack. All of the other things that happen in the barn that you need to focus on to maintain a successful business and there are so many aspects of that. Do you want to begin in the barn or in the office?

Doug: Let’s start out of the barn first. I think in this world especially, never more true, is that perception is reality. I think, from day one you’ve got to figure out whatever successes you might have. I think often times people think “I’ve placed in the top three at a unrecognized competition and that doesn’t mean anything” but there are so many people out there that dream of finishing with a ribbon at a competition of any sort. So figure out a way to get a website up. It’s easy now with Facebook, create a business page to that, Twitter, all of the social media stuff, to post any successes that you have. Try and make the most of it. And it’s not that you blow it out of proportion but I think we of often get wrapped up in thinking “I don’t have the results of Boyd Martin and I can’t possibly compete” but there are so many people out there that strive to go to a competition one day, regardless of level. I think you have to keep your mind very, very open and continue to put out a message. I think you need to refine your goals and continue to work that message out into every form of a press release or bit of news that you can put out. Put out your goals and let people know. The larger the network that you begin to create, the more opportunity will present itself.

Chris: I think the point you’re making, Doug, is that when you start off, you’re not going to be competing directly with the team riders, for example, that have established careers. You want to be thinking globally but acting locally and looking at your local market to establish your business.

Doug: Yes, very well said actually. I think the thing is that you cannot discount how critical it is to do any of the social media stuff because you want to hook to the people you have the support of. You really want them to be invested in your journey. It’s critical. You can’t keep going without them day to day, without the support of a number of people. In some ways they’re allowing you that opportunity, but you need to give back to them in that they are a critical part in this journey and share the experience with them. If you can share that experience, that journey with a very wide group of people, that’s only going to gain attention and gain support. In the end, that’s what we all need. It’s not an individual sport in any way, shape or form. Without a credible team behind you, you’re in deep trouble.

Chris: So look to your immediate family and friends, people who have supported you since you were a child with ponies. You never know who knows who is in business. And they could potentially become a commercial sponsor and it becomes an extended family, doesn’t it, at the beginning?

Doug: For sure. And that extended family will continue indefinitely and I think sometimes someone will come along. I know a lot of contemporaries who will think “you know I’m going to have some big sponsor come along and buy me a string of horses right off the bat”. To me, that’s just not going to happen. So it may be as small as “hey I’ll pick up the shoeing bill on this horse” or “I’ll pay an entry bill or two”. However small it might be, jump on the chance and hopefully share the experience with them. From there it will probably grow and if not that person, they probably know someone who might be interested who will join along.

Chris: I can hear some of our listeners wondering, Doug, that’s very well you have your family behind you. You have the facilities and property and you have the where with all to get started while still with family but let’s just say you don’t have the benefit of family involvement in the sport to get started and you have to go it alone. You may have been a working student, with a top rider, you’ve got some experience. You think “now is my chance to break loose and start on my own." So what would you suggest to young riders who are thinking of doing that?

Doug: I think you could hook up and be a working student and find a way to get yourself in with a program. It doesn’t have to be producing world class horses but seems to have a business model that you’re drawn to. It might be someone who, in the end, wants to have a big lesson program. Find a barn that’s able to produce that. If someone walks in the door here and says they want to help out and they can be here only 3 days a week, that’s great. We’re welcoming people like that all the time. I think the advantage there is that you’re going to miss a lot of insight if you’re trying to do this alone. If you can hook up with a program or business of person that’s been successful, then there’s a lot of key points and tricks of the trade that you’re going to pick up as you go. Now, if you can do that 3 days a week, then it gives you another 4 days of the week that you can start advertising. Go to your local pony clubs or a 4-H situation or plaster advertising around all the local tack shops and just try to pick up small business. It might be that for the first couple of years, that you’re running around to a lot of different barns to teach lessons for kids, adults and amateurs. You’re probably going to spend more time in your car traveling around than you are riding horses. I think that’s ultimately your foot in the door and then a couple years down the line, you’re going to come to a point where you get to a saturation point. You’re going to get to a point where you can’t possibly continue to travel to teach simply because of the demand. I think it makes a whole lot more sense to then rent a barn or rent a portion of the barn and then you can start to centralize your business and people will start to come to you. But in the beginning don’t be afraid of the time you’re going to spend in your car because it’s a necessary evil. You need to get enough business going that in the end, people will start to come to you. That’s only going to happen when your time is ultimately tapped out.

Chris: The other aspect to this is the paperwork in running the business and I think it’s going to be listeners who are wondering “if I don’t have a degree in business or went to business school and I never learned to do the book keeping, how do I deal with that aspect of it?” What would be your advice there?

Doug: I will tell you, I hate paperwork. The best thing I did the first couple of years was that I did it myself. I bought Quickbooks and sort of figured it out myself. I did hire an accountant for the tax situation stuff. To me, it’s a bit overwhelming but in this business, there’s a lot of overhead. There’s a lot to write off but I wanted to make sure I was on the up and up. Invest the money, get an accountant. The best thing I’ve done since is to hire a book keeper. In the end, it costs less than a hundred bucks a month, not even. They are able to make sense of the whole mass of transactions. I basically give them bank information. They go through each of them and monthly we’ll have a call to go through things that might seem abnormal and where that would be classified. The book keeper can go back and forth with the accountant. They figure out the nuances that I would be lost with. The other thing that I’ve gone to the last year or so is an app that I use that’s called “Invoice ASAP” and it’s been awesome. Any lessons or horses that are in training, when they go competing or whatever, there’s an app on the phone where we can say there’s an entry fee or such and such. It could be worming or whatever costs that horse might accrue for the month. You can just type it into your phone really quickly and it actually generates a PDF invoice and that can be emailed off very quickly. That can be a massive savings just because if you wait until the end of the month to remember all the stuff, you end up missing things and it’s going to be your bottom line that’s suffering because there’s a lot of stuff that goes on in the month that goes unnoticed otherwise.

Chris: Obviously the book keeping is critical but there’s also the legal aspect of running the business too. The things like bill of sale and sponsor contracts.

Doug: On the legal side of it, I’ve got a good friend, who actually started off as a student, named Laurie Reager. She’s starting up a business doing just this, rider services. She is an attorney as well. I can certainly give you her contact information if that’s of interest. She’s the one who generates all the contracts and our liability releases and training board contracts and all that sort of stuff. For the first few years, I had written it up myself which probably was not the smartest decision. It seems like it may be an expense that you can’t afford at the time but it’s money absolutely well spent and you’ve got to figure out a way to do it. The intention is always to keep all of your business transactions on the up and up. You don’t think there’s ever going to be some sort of falling out but you just never know so you're much better served to have that and your equine insurance and lliability insurance. Just take a little time to go through it and make sure you're covered. Without it, it can be devastating for sure.

Chris: I think it’s important to lay out those ground rules, those expectations between you and an owner, you and a sponsor or vendor or whoever it may be. That will be a relationship that can last a lifetime if you get it right from the start.

Doug: No doubt about it and I think it’s something you learn through time but I know initially I was way too lenient. You totally bend over backwards and make every accommodation you can. You initially feel as if you need to offer them the world. Over time, you’ll realize where your limitations might lie with time or commitments to others. You just need to revise and reign back the exceptions from the begin and say okay, when someone comes in the door saying “I want you to send this horse” or “I want to take lessons” the way I’ve been working it of late and it’s been working great, is to say “Here’s the deal. I’m on the road a lot, I compete a lot” and to be totally frank, that’s probably the reason they’re coming in the door. The down side to that is there are going to be weeks that I’m only here a couple days of the week. When I’m home, I’ll be there to teach or ride the horse, or do whatever it might be and the times, that I’m away, there are very competent people who can fill in my shoes but initially I probably over committed saying I would do, say, 6 lessons a week indefinitely. It’s just not realistic so you’ve got to be so honest in the beginning. People will appreciate because if you underpromise and overdeliver, everyone ends up being happy. If you over promise, there ends up being a lot of tension and it leads to a whole lot more stress on your part because you’re thinking “I’m getting pulled in all these different directions and there’s no possible way I can keep my head above water”. And it will drive you nuts. So be up front in the beginning, know your time commitments, what you’re able to give and what you're able to offer and just be straight with people from the beginning.

Chris: In summary, can you give a startup checklist for people to consider when they are getting their first piece of paper, it's a blank and they don’t know where to begin.

Doug: I think you're dead on. For the legal side of it, you need to have liability insurance right off the bat and there are a number of insurance providers. The nice thing there is that they will guide you and tell you exactly what is needed and what they require. If someone comes for a lesson here, we have a liability release. If I didn’t actually have one, the agent should be able to point me in the right direction. If you have horses in board, make sure you have care, custody, and control insurance and you also have your liability for teaching. Make sure that’s covered. Once that’s covered there, god forbid something horrible happen, at least you have the backing of your insurance company. As far as the book keeping, do your best to at least have an accountant who can oversee your all of the transactions for the year. It could be as simple as Quickbooks and do it yourself but I would definitely have a professional take a look before you submit taxes. Then on the promotional side, get a website going. First thing, easy enough would be Facebook and Twitter but there are lot of services now through Squarespace and Godaddy that have web creation services. It won't be crazy expensive. You don’t need an elaborate website. Just have a couple pages that tell your story and describe you and what kind of services you can offer. Just try to continually plug away at it and from there, go and get as much experience in the saddle as you possibly can. You have all the underpinnings there and you're going to be in good shape and any success you have, small or large, you make a big deal out of it. Go from there. Like I said, if you do right by people, everybody talks. If people have a good experience, they’ll tell all their friends that they had a good experience. Sure enough, you’ll pick up some of their friends and it sort of snowballs over time. I'm not going to lie to you. It’s not an easy business to be in. I wouldn’t trade it. I don’t have any complaints what so ever. I’m very, very lucky to have the opportunity I’ve got.

Chris: As we know, success is based on hard work dedication and not forgetting, everybody you meet could lead you to something better.

Doug: Absolutely!

Chris: Alright Doug, thank you very much for coming on the show and sharing your experiences. It’s obviously working for you. Good luck with the new business. I know you’re developing things fast down there in North Carolina.

Doug: Thank you very much. Hopefully we'll be back next Spring. We’ve got the farm and hopefully it will be up and running in the springtime. It will be very exciting for sure.