Companies do team-building activities to develop deeper connections between their employees. But what happens when co-workers no longer work in the same place? And what about the companies whose business is organizing said activities?
The answer to both is bringing team-building activities online, mostly through the use of Zoom. In the below Q&A, Michael Alexis, founder and CEO of TeamBuilding, describes his company’s initial struggles with a remote work environment, and how his team powered through to rebuild a profitable business.
What does your company do?
We provide facilitated team building activities as a service to organizations. Most of our clients are enterprise level, including Apple, Amazon, and Google, and we work with a range — from national law firms to government entities, pharmaceutical companies, non-profits, educational institutions, and more. Now, we primarily provide virtual team building activities via Zoom and other platforms.
How have you conducted business in the past?
In the past, our business was entirely focused on local, in-person team building events. For example, we had a guacamole-making competition brand called The Great Guac Off and a holiday-themed Gingerbread Wars. For most events, we would provide a host and a co-host that would carry any supplies needed to the client's office or other onsite event.
What immediate effects did stay-at-home orders have on your business?
Even before the official stay-at-home orders, large companies started implementing internal travel bans and canceling group events. As our business serves this market, we saw a swift and heavy decline in business — from $250,000 per month in revenue to nearly zero in three days. In addition to the loss of revenue and new business, many of our clients also reached out to request refunds for booked events. Fortunately, we were able to retain most of these funds with patient clients and a generous credit policy. We extended from our usual 12 months to a full 24 months and made the credit transferable within organizations.
As a result of the near total loss of revenue, we needed to quickly reduce expenses. The most significant action was that we initiated layoffs for our facilitator staff. These layoffs allowed our people to access unemployment benefits. We established an emergency fund so that anyone could request funds for essentials during the transition. Another example of a cost reduction was with our software subscriptions. For example, we previously paid about $5,000 per year for an advanced email marketing platform that we hardly used. We transitioned to a self-hosted application that costs about $4 per month.
“Like exercise for the body, 30 minutes of care can go a long way to building a strong and healthy remote team.”
At the same time as we were reducing expenses, we were also looking for opportunities to create new revenue. We brainstormed ideas like online courses, membership programs, and selling future credit. We wanted to see if there was any data that would indicate opportunity in our industry, so we checked trends.google.com and saw a spike in searches for “virtual team building.” We had very little experience in this area, but it seemed like a logical extension of our existing business model, and one that had potential to bring in meaningful revenue.
What changes did you make to adapt to our current situation?
Within 24 hours, we had a new page up for virtual team building, promoting event types like Online Office Games and tiny campfire. This marketing was mostly smoke and mirrors at first. We didn’t know exactly what would happen at a “tiny campfire,” but had confidence that if we could sell it, then we could develop an experience quickly. Our first lead came in within 10 minutes of the page going live, so we knew we were on to something.
All of our virtual team building activities are facilitated by a trained host and usually over Zoom for 90 minutes. Online Office Games is a series of fun games and challenges, including trivia and a skill-building game called “Can you hear me now?” For tiny campfire, we send s’more kits to participants in advance and then get everyone together for virtual camp games, ghost stories, and a tea light campfire.
The first few months were spent rebuilding operations. We rehired many of our people, trained up new folks, and went about setting up new systems. Now, we’ve been able to create a cadence for launching new virtual events. For example, we have a tea and coffee tasting experience, an RPG inspired game called War of the Wizards, and a murder mystery. We are working on new product launches through the end of the year.
What were the challenges in implementing these changes?
One of the biggest challenges to transitioning online was learning how to describe our products. With local events, you can talk about a guacamole-making competition in a way that naturally sounds fun. With virtual events, a scavenger hunt where “everyone goes and grabs a potato” sounds silly and kind of boring. We’ve been working on training our sales team and also developing language that helps, like “lightning scavenger hunts.” Demo videos help, too, so that potential clients can better visualize this new service.
Being early to market with virtual team building also meant we needed to define the market and prove that value was there. For example, with local team building our pricing is typically $60 to $120 per person depending on the type of experience, supplies involved, location, and other factors. For virtual, most of our events are $30 to $60 per person, with the higher pricing for activities with more training or shipped products. One way we create value is by providing a co-host to manage all the technical aspects of the call so that the host can focus on making sure guests have a great time.
“Short-term profits are important, but your legacy will last much longer.”
Another challenge has been with logistics. Pre-stay at home, we’ve never run a business with shipped products; our hosts just showed up with whatever materials were needed. With tiny campfire and our other events that included packages, we needed to figure out everything from packaging to international shipping and more. This challenge was compounded because of the remote situation. For example, early clients would want to book events on a tight timeline, and even with rush shipping we had packages arrive late or not at all. For international shipping, sometimes the s'more kits were caught at the border. Our solution? We found locals in places like Canada and Australia to purchase the products and ship domestically. The logistics are a continued and expensive project.
What have been the results?
Financially, we are doing well. We managed a small profit in March despite the total loss in revenue, then substantial gains in April, and have continued to grow since. We've more than doubled our pre-remote number of $250,000 per month. The move to virtual has also opened up a much wider market for us. Now we are working with organizations all over the world, from the US, Ireland, Singapore, China, Australia, and more. We are also working with more government organizations to support their teams.
The success of the new business model allowed us to hire back many of our people, as well as new team members. We have great morale, even with all the challenges going on in the world, and are grateful for the opportunity.
What have you learned through adapting to a remote environment?
We've always been a remote team and took it for granted that we've built up the support systems for it. So, it was an important realization for us that not every team would adapt as easily. For example, when you go to an office, you have the basic social outlet of saying hello in the morning or enjoying lunch with a colleague, which remote work lacks. Working from home usually lacks these interactions, and it can be lonely and isolating. Boring meetings don't help. Like exercise for the body, 30 minutes of care can go a long way to building a strong and healthy remote team. There are free virtual team building activities to try.
What advice do you have for others who are trying to figure out this new way of working?
One of the reasons we’ve been successful is that we made significant changes quickly. We ignored the rhetoric that business might be disrupted for a few days or weeks and assumed it would be for a much longer term. I believe this will continue to be the case and that you should make investments accordingly.
You also need to provide strong leadership, which in this case means navigating with both compassion and decisiveness. With the wild swings in the market, you need to make large decisions with very limited data. Gather what you can, mitigate your risks, and move fast. For us, Google Trends was a useful tool.
Above all else, approach your business with Level 10 Integrity. 2020 is one of the most complex business environments many of us have ever seen, and a lot of folks are cutting corners. Short-term profits are important, but your legacy will last much longer.