Greetings.
Due to some questions asked, we stepped back for a while to evaluate whether our RFP and the details within were reasonable or not. We reached out to select members of our community who we felt had a vested interest in this program, as well as our faculty during our most recent session of the Certification Program in Arizona which ended last week. What we found was that the vast majority of the people we contacted felt it was a reasonable business model when looked at in its entirety, even if for some it wasn’t necessarily something they wished to pursue in their own lives. We also found that there were varying levels of understanding the scope of work required depending on the person’s previous experience with our program (such as teaching a Foundations Year 1 course in partnership with Innersource or not). As some of you do not have that experience, I shall attempt to fill in those missing pieces, as well as discuss some other areas of concern brought to our attention.
I will start with a comment that our RFP is inconsistent with what was expected to be seen in a franchise-like model; one that reflects an open market model where the Regional teams would be responsible for generating interest in the product and then recruiting the general public to select them. The Year 2 Program is in fact a closed model. Only students who have completed Year 1 are eligible to attend. All marketing contact for Year 2 will originate with Innersource and the Regional teams will only be responsible for providing the ad copy to be inserted into the shared cooperative announcements which will be sent out by Innersource to all eligible candidates. The added benefit is that none of the contacts will be “cold” or need to be informed of the value of Energy Medicine. These students have already completed one year of training and will be well acquainted with the product and most will be enthusiasts as a result. Innersource will be informing a closed group of customers that each of our Regional Directors are one of a limited choice of people offering their next level of training.
This exclusive access to Innersource private list of eligible customers is a key component to the different between the typical franchise model and our offer. It will obviously require some attention to detail to tailor an appealing message to prospective Year 2 students about your Region, but it will in no way require a full-time Marketing Manager.
Before I completely leave this discussion of relative models, I would also highlight that unlike a typical franchise model, we are not asking nor requiring the Regional Directors to pay any sort of upfront fee to Innersource to join in. Given that this can range from $30K to well over $750K in some cases, this is a significant savings to the prospective Regional Director and removes a barrier that some worthy candidates might not be able to put forward for a new venture.
I can personally address a question about needing a full-time event planner/site manager. Having spent over 15 years in the corporate event planner industry, I have extensive experience in this area and feel very comfortable in saying that running a regional Year 2 school will not require a dedicated staff person for those duties. (As a FYI, we currently do not employ a full-time Event Manager while running the entire Certification Program in Phoenix.) Given the likely range of 35-60 students, plus 5-8 faculty and assistants, a non-teaching Regional Director should have little difficulty managing the process onsite themselves, or hiring someone at a reasonable wage to assist. The Innersource registration and reporting system used by the Regional teams will free them up from many of the time-consuming tasks that are usually part of that process.
The pay rates for teaching roles is itemized in the Financial Example in the RFP and is, for better or worse, significantly lower than what you might expect as an open market rate. Our faculty would love more pay but understand from their own practices the challenges of an emerging health system paradigm to establish itself. Our existing CP faculty are dedicated professionals who understand that they will not be receiving top tier wages for their efforts but still give 100% of themselves. We have made every effort over the years to increase their wages when possible and even include a small increase in our example. The cost of these teaching roles (and their related travel costs) are also included.
We see the regionalization of Year 2 as a logical growth from our regionalization of Year 1, which was first undertaken about 8-10 years ago in varying degrees and has been a significant success. Innersource receives a 30% royalty from the Year 1 teachers, while providing marketing support, delivery of printed materials/handouts, a dedicated Innersource contact for Year 1 teachers, as well as training webinars to improve teaching and marketing skills. Innersource has spent over two years and thousands of dollars upgrading its systems to provide the Year 2 Regional Directors an even more complete package of administrative and educational support. Our workload analysis projects that it will be less work intensive to operate a Year 2 school year with more students than a smaller Year 1 Foundations Class, with the added benefit of not having to “beat the bushes” to find students and interest them in the program. The customers for Year 2 are known and already acquainted with the material.
Historically since CP began, 53%-67% of Year 1 students move on to Year 2. More recently this has settled closer to a narrower range of 53%-58. For the last two years we have personally called every Year 1 student who did not attend Year 2 to survey them as to their reasons. They fall into three main groups: Those who cannot afford to go, those who cannot travel so far and/or take off that much time from work, and those who feel complete after taking Foundations. (This latest – we believe – is the result of our intentional efforts of shifting some of the curriculum around to make Foundations a more substantial experience on its own and the narrower range of conversions is a byproduct as a result.) We anticipate that regionalization of Year 2 will slightly increase the conversion rate due to the shorter distances required to attend and the likely lower overall costs of being onsite – lower hotel and food costs, as well as likely lower travel costs and less time off work. This will probably only be in the 5%-10% range, but an increase of 15-30 additional students converting to Year 2 is a significant difference.
Foundations student counts vary by year, but since converting to a regional model for Year 1, the range has been from 210 to 330 students. The class currently completing Year 1 is at 310, which reflects the impact of our growing presence online with programs running through Mindvalley and The Shift Network. EEM has translated well to these formats and in less than a year, Donna’s program on Mindvalley is already their 2nd most successful and their highest rated one ever. With a mailing list of over 4 million people, this has been a very successful partnership for us. Pursuing opportunities like this and freeing up our small staff to support them is one of our primary motivating factors in outsourcing the actual running of the Certification Program to select partners.
A partner who has experience in running small events, hires quality faculty, and runs the classes in a convenient location with access to affordable food and housing will find themselves in a profitable situation (as described in the RFP financial example) providing high-end training in EEM to motivated students. This example reflects the revenue potential for a small class (36 students) as well as a larger one of 48 students (a reasonable estimation of growth in coming years) even after paying out the 45% royalty to Innersource. Given that this represents a part-time commitment over the year, with most of the work being time optional – can be done when convenient rather than clock specific, such as scheduling meetings and/or answering emails, a low-end estimate of over $50,000 is a nice profit. This is especially appealing when you consider that Innersource is still providing the systems and mechanisms to register and manage the students as they progress through school, providing and printing all handouts, and managing the marketing to all eligible students. Foremost is that these students are warm to hot customers and Innersource has the contact information for all of them. No extra effort is required to create interest or awareness.
We understand as a company that this opportunity is not for everyone. It will be hard work for periods of time and not everyone has the bandwidth or desire to shift their lives or existing businesses around to fit it in. But those who do will find that there is ample down time running a regional center for EEMCP Year 2 to fit in other things, such as a practice or vacations.
I thank you all for your questions. It gave us a reason to pause and reflect on our intentions and see if we were being realistic in our expectations. After consultations and reflections, we remain comfortable with our offer and feel it reflects the workload still being carried by Innersource, while also offering a generous and fair reward to our partners for taking over the important task of finalizing our students’ training to becoming Certified Practitioners.
I hope these answers are useful and address areas of concern that may have arisen. Please feel free to contact me if you have any other questions or issue you would like to discuss.
Best wishes,
Roger
Roger Devenyns
Chief of Staff, Innersource
(619) 519-0557