Our client, celebrity nutritionist Rachel S. Beller, regularly receives proposals from companies wishing to collaborate with her. We evaluate those proposals to make sure they enhance her brand and not exploit it, and to determine whether the proposed ideas, plans, and promised returns are realistic.
One such proposal came from a major Hollywood talent agency and a new media entrepreneur they represented. The proposal described a Facebook-based game like Farmville (still thriving at that time), with women competing to become more fit, physically, mentally, and emotionally. Rachel was invited to be the sole nutritional expert for the game.
Our analysis started with a review of the proposal and research into the stakeholders:
- Lack of details and production quality: We first reviewed the plain Word document introducing the game. Filled with jargon and writing errors, the proposal read like a broad concept statement emerging from a brainstorming session, and it included no images beyond a logo. It certainly did look like the product of a major talent agency. More critically, it lacked vital details, such as how the game actually worked and the revenue model. The document did include the names of the entrepreneur and the South American social-media game company, but otherwise did little to build excitement or confidence.
- Questionable experience: The entrepreneur had held prominent executive positions in major organizations, but her only startup had failed shortly after launch. The game company had success with a children’s product, but had not created anything for adults. No explanation was provided for choosing a distant foreign game developer instead of one of the many L.A. shops.
- Questionable expertise in social media: Despite being touted as a new media expert, the entrepreneur did not have a Twitter account, and the Facebook and LinkedIn profiles had fewer than 100 connections each. The software company’s owner, who would serve as the game’s CTO, had abandoned Twitter after a short run, and was barely active on Facebook. While many successful executives are not active in social media, their lack of participation in their chosen field raised further doubts.
Next, we met the entrepreneur, who proved to be personable, intelligent, and smoothly enthusiastic while walking us through a demo of the game. We asked numerous questions, and the answers raised a number of red flags:
- Facebook unaware? Facebook tightly restricts contests on its platform, so we asked about Facebook’s involvement. The entrepreneur’s response: “We think Facebook knows about us.” If this was a major agency project, Facebook should be a partner, least of all have full awareness of it. Otherwise, the game could fail if Facebook disapproved (which happened a few years later to Farmville).
- Questionable participation by other experts: The entrepreneur named a fitness celebrity (also a client of the talent agency) who would be the resident exercise expert, and showed us the celebrity’s book integrated into the game. What struck us as odd was that the book image wasn’t a scan or official image; rather, the book’s cover had been amateurishly photographed (soft focus) and inserted into the game. This raised flags about the entrepreneur’s technical and marketing savvy.
- No equity and no payment — only a minority share in the revenue: Rachel was asked to provide her name, photo, consultation, recipes, game ideas, and game supervision, while marketing the game to her sizable fan base. But she was offered only 30% of the game revenue, and the entrepreneur had no projections of what that revenue might be. Given that most new media startups are not profitable, and tend to make money from investors and the stock market, the end result might have been a huge payout to the entrepreneur, while Rachel would receive nothing for her work, brand risk, and time away from her core business and other opportunities. In fact, since the entrepreneur would not cover Rachel’s expenses, the net result could be a loss.
- 18-month exclusivity clause: In addition, Rachel would be precluded from participation in “similar projects” for 18 months.
- No marketing: The game would not be advertised, and would rely solely on promotion by Rachel and the other celebrity experts. The entrepreneur pointed to Farmville and other kids’ games as examples of successful ventures based solely on word-of-mouth. However, there’s a significant difference between a free kids’ game and a fee-based adult game (women would have to pay to play). It could take months just to get a few hundred users, if ever, and social games rely on massive numbers of participants to succeed.
- Potential for cheating: The game relied on players reporting their fitness results honestly, since there would be no way to verify their exercises, diets, and results. The entrepreneur claimed to have tested this game with friends, who did not cheat; that answer came across to us as naïve. Since the actual game would involve strangers paying to compete for material prizes, we felt that cheating was not only guaranteed, but would become the norm for the short life of the game.
Some people might be tempted to risk involvement with a new media startup promoted by a major talent agency, at the least to build relationships with the key players. But the risk here wasn’t just time and money; Rachel’s brand was at stake. Being associated with a likely failure, surrounded by a cheating controversy, would make it difficult for Rachel to attract future offers, and might even cost her fans and current media deals.
We recommended that she thank the agency and the entrepreneur, and state that she simply didn’t have time to participate right now, but would love to be updated on how the game performs.
The game never got off the ground. The entrepreneur and the agency parted ways less than a year later.
Rachel focused instead on writing her book, Eat To Lose, Eat To Win, which we helped her develop and promote. It went on to become a best-seller, leading to more media appearances and a paying collaboration with Ninja Blenders.