Oh this is gonna be a good one. A real life story of how a talent agency negotiated a deal with us that they couldn’t afford in order to get financial data and insights into our business. This type of stuff happens a lot but few talk about it. Mind you, it happens frequently in VC circles. Investors hear pitches so they can get financial insight into a promising start-up and share that insight with another party.
I’m writing this because I think this is the type of stuff that I most enjoy reading. The real life stuff around building and doing business. The world is full of people who will do anything to make themselves more money at your expense. Choosing who to do business with is 90% of the game. If you’re a founder, the best thing you can do is to be overly rigorous and selective with the people you surround yourself with. In this story, the agency we decided to negotiate with was introduced to us by someone we viewed as trustworthy. So even with decades of life experience, we all get it wrong sometimes.
On to the story
2024. What a time. We focused so intently on building a production team that could make the best videos for Hassan. We defined best as ‘Making videos that got great views in the shortest time with the best value for money’. In hindsight, we didn’t clearly clarify this goal with our team on a regular basis. We were dissecting parts of the production process and focusing on making each part better. We built our own content management system in Notion. We hired people. Fired people. We understood where and what was being spent on every single YouTube video. Breaking down these details helped us figure out what a video with 1,2,3,4,5+ Million views actually cost. Short vs Long views obviously had different value.
Point is, we invested a lot of our time into content. Little effort was directed towards generating more sales. Deals were coming in and the business ticked along. We should have focused on both content and sales.
With that in mind, we were approached by an industry peer (let’s call him Bert) who was representing a sales agency which he was due to join full-time. Someone both myself and Eyad knew personally. He came to our office and pitched a revolutionary new technology their parent company was using. Showed us screenshots of the tech. It provided deep insight into a creators audience which brands loved. This gave them a competitive edge and meant they were selling like crazy. He said his agency already represented talent and promised they would get 5-10x more deals than anyone else. Including us.
A proposition we’ve explored before but declined. This time we thought why not. Bert’s a good guy. The deal would see us hand over exclusive sales rights to this agency in exchange for a 7 figure guarantee, paid in advance. They’d then monetize our creators while we focused on hyper-optimizing content, focusing on the creators brand building and co-investing into other ventures with them. In short, they would sell, we’d do the heavy lifting that drives the price they can charge to buyers.
The Set-Up
As with every potential partnership opportunity, Eyad and myself talk about it. We primarily ask ourselves whether we trust, respect and believe the people on the other side of the deal. If we do, we then assess the opportunity. Because this opportunity was being presented by someone we both knew, we told Bert that this would be a deal we entertained if he gave us his word the company was solid and he would oversee the deal and the follow-up execution. He emphatically told us that this company had the best tech, an investor agency with offices globally, prolific company ownership and that he would be looking to join them full-time as an executive. That was the set-up. We decided to move forward and told them to make us an official offer in writing.
The Play
Now they were ready to run real game on us. They asked for an in-person meeting where they made grand guarantees of their abilities, their incredible brand-side access, top-tier agency investor, relationship to billionaire founders and celebrities. Following the meeting, we gave them a number we expected for the guarantee. They countered with half of the ask. We were surprised. This is a number we’d achieved before and did without a sales team.
They said they needed our financials to prove that we had achieved that level of success before. We didn’t care. Our financial reports aren’t a secret to our success. They’re merely an accounting of who paid us and what we spent. After receiving this, they took a very long time to review this and made an offer. Between making that offer, we were constantly following-up because they gave us deadlines that they never kept. Their word or commitment to doing something was never honored. And then the market-seller negotiation tactics emerged: We can’t pay the full amount up-front, we can do 50%. We’re on the hook for the money if we don’t generate it. A string of excuses to avoid paying out a deal they had already agreed.
At this point, Eyad & I did knew they didn’t have the money. But we’d still ask for the offer in writing and a contract.. Bert might prove us wrong. Suffice to say, both the offer and contract never came. And that was the play: Earn our trust, Leverage relationship with Bert, get our financial data and extract value from it (what clients paid us, etc) so they could use this knowledge to benefit their business.
I laugh at this now because Bert lost more than everyone else.
Red Flags
During the time this was all happening, 8Flamez was in the process of signing deals that were already making this offer no longer valuable for us. But when you choose to work with someone you know, you want the deal to work because it’s a W for everyone and the future prospect of winning. We also tend to dismiss red flags. In my personal life, a red flag results in immediate action. I have notoriously low tolerance the older I get. In this instance, I wanted to share the flags.
Doing diligence on the business partner. Along the way, we did some digging into the parent company. We reached out to third parties we knew and asked them to speak to the company’s investors, their talent, partners that they’d worked with. Turns out that the parent company was a boutique player in another market with a US office presence. The guarantee they were making us was by far the largest cheque they’d ever written to a creator. It was a digital doc offer and they likely didn’t have the cash. The local Dubai shop wasn’t doing any big deals and were working out of an office paid for by an investor. Flag.
Word of Mouth. We spoke to people about their interactions with this company. One of the creators we spoke to told us that dealing with a senior person at this company is the reason he trusts no-one. He explicitly told us that any deal this person makes never materializes. He told us that this person was able to lie and manipulate people with ease. He made himself seem more important than he really was. He faked clout and influence. Flag.
Words vs Actions. This one’s a big one. Throughout the process, the commitments they made often never played out in real life. Deadlines were set. Money was agreed. Terms were discussed. A single rookie-looking offer letter was sent via email but no real contract was ever sent. We even met in person at an event and took time out to engage with the agency where they continued to promise success and showed off the excellent relationships they had with big business magnates. No deal ever materialized out of these big relationships. Flag.
The Post-Game
A few months have gone by since then. 8Flamez has already closed more $ than the fake guarantee the agency made. We’ve signed another incredible creator. Due to announce a third and close to a fourth. It’s been a very blessed quarter.
So whilst it’s a win on the business side, it’s important that we acknowledge we lost something truly valuable: time. And that’s why I’d say we got played. Had we recognized the red flags early, forced pressure and exposed the cracks in their game plan, we’d not have wasted the time.
As a founder of anything, your job is to solve the company’s worst problems. I love it. I’ve learned I thrive in high pressure environments and get lazy when there is no pressure. I love peace in my personal life but need to be constantly challenged in my work. And my work helps me reflect on how imperfect and stupid I am.
A few months later, we were in a meeting with a business partner in another country. While speaking to them, I was telling this story then later asked myself why we even entertained the deal in the first place. The agency said they could sell better than anyone else. At the time, we believed that might be true. Since that time, the agency has done no significant deals for anyone.
It turns out, they are far from the best. And both me and Eyad love a good challenge. We love deal making. We love sales. We have the biggest creator in the Middle East. We have the biggest studio space of any agency or creator in the country. So what’s our goals for 8Flamez Talent from Q2 to year end?
The exact same way we built a process for the biggest YouTuber in the Middle East to pump out Millions of views at scale is now what we’re doing to build a hyper-successful sales team. We’re testing the best audience and AI insight tech in the world to give our team the tools they need. We’re interviewing the industry’s best sales people. Creators we haven’t signed exclusively have already received deals from us they didn’t get elsewhere. Things have moved so fast.
And 8Flamez just signed the hilarious skit creator Ahmad AlKhateb. Check out the views he’s getting. He’s gone from 200K to just under 1M in <90 days.
Here’s to 2025. Crazy cool things are happening. Thank you Allah for every single day of a chance to do better. And thank you to Bert and the agency. You’re a reason we’re going to build a phenomenal sales team.