Transcription
This is Pete Moore on Halo Talks NYC. I have the pleasure of bringing a very qualified legal professional, also quite frankly, a great entrepreneur. Uh Corey Sterling coming in from Conscious Counsel. Good to have you on the uh Halo Talks [music] and uh introducing you to our audience.
>> Pete, thank you so much for having me. I'm so happy to be here on Halo Talks and [music] excited for a great conversation.
>> Awesome. So, why don't we just first talk about, you know, your background, your career, and how you pivoted into a very interesting niche that, you know, we uh we believe is a full-time job uh serving the health, fitness, and active lifestyle industries.
>> Hap- happy to start there. I used to work in professional sports. I did marketing for the NFL and the Oakland Raiders in a different lifetime. And I did a lot of informational interviews when I was there, including with Roger Goodell, the commissioner of the NFL. And I I was quite young. I was 23, 24, and I said, "What advice would you give to your younger self?" And all the executives I spoke to or met with said, "I would get an MBA or I would go to law school." So, I went to law school later in life, became a lawyer, worked downtown in a suit and tie, was absolutely miserable, as you can imagine. Not me. I'm all about people. I'm all about movement. I'm all about health. At the same time I was working at that law firm, I was teaching yoga classes and cycling classes and group fitness classes at Equinox and other gyms in Vancouver, British Columbia, Canada. And one day I went to a yoga class, one of the students in class got injured. We didn't sign a waiver. I asked the teacher, who was my friend, I was like, "Hey, what happened? Wh- where's the waiver of liability?" And they just like didn't understand what it was about. And then I started having more conversations with other friends of mine who were health and wellness professionals, gym owners, studio owners, and I realized no one really knew anything. This was in 2016. And so, I was just like, "Cool." I was ready to quit being a lawyer because I was so unfulfilled working in the corporate space and I thought before I quit, I might as well just try to serve a community that I'm a part of in a community that I'm passionate about and I started Conscious Counsel and just began survey started very very low scale working with yoga studios, gym owners and since then it's it's grown a lot a lot a lot and you know, 9 years later here we are.
>> Yeah. So, when you started doing this, were you trying to get on as like their, you know, power of attorney like, you know, that their their lead lawyer or did you just say, "Hey look, let me just come in here and basically make sure that all your documentation is in order?"
>> Yeah, it it started really from help and pro bono, right? I I had a I had a full-time job. I was wearing a suit and tie and so, these were these people are my friends and I saw them doing things incorrectly and so, I just thought like, "Yo, let me look at what you're doing and let's make let's set you up to do it correctly." And I probably had three or four of those sorts of experiences where I just help people where I and then I realized suddenly actually there's a need. Like there's no lawyer This is the truth. Now in in 2026 maybe it's a little a very little bit different, but in 2016 no one was paying no lawyers were paying attention to boutique fitness studios, to Pilates studios, to gyms, to yoga studios and so, for me it just was a natural niche and and then I yeah, I've I've spent the past decade essentially just doing the same fixing the same problems that a studio will go through that that a health and wellness outdoor business will go through and and that's really been my passion.
>> Mhm. And how how's word been getting out or how have you kind of morphed the business into more scalable, you know, I I know you can download some some templates and things, right?
>> It's it's really the I and for all entrepreneurs who are listening, I think there's a it depends what your intention are. Some people build businesses to scale and sell. That was never for me. I always wanted to have a business that was my unique offering to the world that I thought the space needed to apply my particular technical skills to help people in a way that's in alignment with the vision I have for the person who I am in the community that I want to build. And word of mouth is just like if if you're in that game, word of mouth is everything. Right now we've got 466 five-star Google reviews. All of our clients give us five-star reviews. And a lot of our business comes from referrals from existing clients. We've won some awards in the past, which helps. And and usually just doing partnerships or joint ventures, a lot of the time I'll get on a call and and the first thing a client will say is like, "Wow, I'm so happy that you exist. I had no idea about this." So, like for most businesses out there, the question is how can you create awareness and attention so that people can understand this the gift that you have and the ability to work with and use your services. Does that answer your question?
>> Yeah, it does. Are you Are you focused on the front end when people are are starting their businesses or you typically coming in when something happened?
>> Well, there's there's proactive law and there's reactive law. And that's one of the that was one of the first concepts that I that I understood when I started doing this. Proactive law is I'm about to open. I know I'm going to hire I'm not sure if they're employees or contractors. I'm not sure if my waiver of liability will cover supplements. All those sorts of questions. I don't know how to come up with a membership guide or behavioral expectations for my members. Um proactive, you do you draft the documents first, you invest in legal up front up front. And then when there's an issue down the line, it can be resolved with one email. Conversely, reactive law is, "Hey, I'm going to cut corners. I'm starting this thing. I don't really want to invest in legal right now or to do things properly." Eight months down the line, you have a contractor who you you have an an who you're calling a contractor, who now is threatening to call the IRS against you. I went through this last week, not fun. For all of my clients, I always want them to be in control of the situation. And the way that you control the situation is by having industry-specific documents drafted by a lawyer who understands your business and the specific relationship you want to have with your clients. So, proactive law has to be the way.
>> When you get on board with an entrepreneur, and I've been an entrepreneur many times, they are very hesitant to invest in things that they don't think are, you know, core to like launching the product or the the service. And you know, probably even now worse with, you know, ChatGPT and Claude. They think you just ask a question, you know, you get your answer and you're covered. My point of that was, are you seeing smarter entrepreneurs that are being proactive now? And And is your service so scalable to an extent that, you know, it's not like you don't need 100 hours of of your legal services to get get somebody up and running.
>> Okay, two two two questions there and I'll break them down individually. Am I seeing smarter consumers or people are entrepreneurs getting smarter?
>> Yes.
>> Entrepreneurs are becoming more dependent on technology, and the limitation with that is like ChatGPT is helpful to some extent, but the thing is that ChatGPT doesn't have the history or the experience of having done this very very specific thing over and over again to understand what sort of problems will come up and to produce a document that A, you understand, that has the things that you need, and B, proactively goes against the issues that a law practice that's been doing this for 10 years has in place. The other big pivot on the on the first point, so I'd say that entrepreneurs now will be more of the questions I get are different cuz I can tell clients are using ChatGPT, but also for me it's helpful because sometimes my clients have issues, and the contract in question is drafted by ChatGPT and then it's very easy for me to challenge and overcome it. Your legal position is connected to the strength of your legal documents, always. That's how your business runs. If you've contracts that are specific, drafted for you, the industry that you're in, you're in great shape. If you don't understand your contracts or you're just letting ChatGPT draft it, there are going to be holes and when those holes get exposed, it's it's the same as not having something. In terms of the scalability of the business, I've always had a philosophy of doing like I want to do one thing best in the world. You know, uh Good to Great by Jim Collins.
>> Sure.
>> You know, the head the hedgehog principle?
>> Mhm.
>> The The hedgehog principle is like choose something that you can be the best in the world at. And so, what for as a legal as a the legal practice that I've grown, we basically draft five types of agreements and we help clients with trademarks and licensing. And that's it. And there's a lot of work that I refuse cuz it's outside of my zone. And so, it's scalable in the sense that now, you know, it takes me 10% of the time that it used to take me a lot longer.
>> [snorts]
>> So, on the the agreements and and obviously, you know, state waivers, um you know, there's there's liabilities, there's, you know, precedent transactions and people are you know, lawsuits or settlements and people are trying to um you know, ensure that they are they're covered on. Um so, are there any, you know, are there like two or three things that that have happened, you know, like in the last three or four years, let's say, post-COVID, where you're like, well, this is kind of like part of the waiver now that maybe wasn't or here's like a new thing that we've inserted in for clients because we've we've gotten some issues related to something that was missed?
>> Yeah, it it's it's a great question and one thing that we've seen has been with health clubs and health services and gyms that now sort of offer alternative they're definitely not medicines, but pseudo medicinal practices of coming up with protocols that include hormones or different types of things or injections or blood works or Ozempic or all of those different things that are taking place. We've had an issue where sometimes that can be construed as pseudo medical services, which invite a whole plethora of legal liability outside the scope of what a normal gym would have. Um as well as and so the the changes that have need to be taken place for that uh are in the waiver and in the service agreement and also working with businesses specifically to structure in a certain way so that they're shielded from liability in those situations. Um and the the other thing that that I that I'd say that I've seen is just increasing the scope of all the different activities that that that gyms will do. Um not only just with supplements and the pseudo medical services, but a lot of stuff around breath work, around contrast therapy, around saunas. Um that that's something where a lot of the times a a studio owner will offer new services, but keep their documents the same.
>> So they got you.
>> And so it's it it's really important and then the last Yeah, the the last piece I'll just add last year was the click to cancel laws, which really really threw a big wrench in in the system because it changed how auto pay works, it changed how people can cancel annual subscriptions and working with my clients to make sure that if someone cancels something early, you still get paid the amount that you would have got paid um if you agreed to that particular time frame at the start. So a lot of changes, really interesting and and and yeah, it's dynamic and it's it's flowing.
>> Mhm. Have you dealt with anything related to uh gift card expirations and/or uh prepaid sessions that have been you know, that that people try to burn off, let's say, and not fulfill. Not that they wouldn't honor it in the right situation, but
>> Nothing specifically around Nothing around gift gift cards. I did have a client who sold certain sessions. They followed up with the person who bought from their studio, and the person just like delayed, delayed, delayed, delayed, never responded. And then that person issued a chargeback for the amount. And it was like it was quite it was quite a number of sessions. But look, this is why you need the agreements in that situation. We drafted the membership agreement for that particular type of service. We said that there was an expiry, that every 90 days any unused sessions will expire and you'll have to buy again. And so we submitted the claim and we won. So it's That's why you That's why you just want agreements to reflect the relationships you want to have.
>> Got it. So Corey, how What have you seen on the on the click to cancel and how vigorously is that being enforced or, you know, what what's the compliance like on this so far from your viewpoint?
>> So click to cancel is federal, so it's going to apply to all businesses. And where I've seen the majority of click to cancel issues come up has been someone disputing a contract or membership agreement. So they're supposed to pay a certain amount, they sign up annually, so they're paying $200 a month when they should be paying $400 per month. And then after 3 months, they just decide, "Oh, actually I don't want to pay this anymore, so now I'm I'm out and I and I cancel." And when that situation comes up, you need to demonstrate that your legal documents reflect all of the click to cancel rules, that you followed It's just about compliance. You did A B C D, the agreements are correct, the agreements have all the legal elements. If that person, you know, when when you're challenging the chargeback, you're able to show in the contract that you followed everything. And also I often send emails to people saying, "Hey, I understand that you terminated this agreement. Legally you're not permitted to. This is the amount that you have to owe. If we have to pursue this, we reserve the right to counter-claim plus interest plus fees. So, it's not I haven't seen it so much enforced governmentally, like by a governmental entity or body that's going after people, but in day-to-day, anyone who has subscription services, you have to be on the right side of that.
>> A question for you about GLP-1s, longevity, IV drips, um Botox, parametric chambers, those sorts of things. I think there's going to be a wave over the next 12 to 24 months of med spas going inside of a health club or studio, or potentially like a franchised situation where you run a yoga studio, you got an extra you know, 500 square feet, you bring in a serotonin center that's inside. How do you view Can I Can I sign a sublease and like say, "Hey, this is a you know, a separate entity, um and they they handle the liabilities" or do you have to get, you know, additionally insured? How How do you view that?
>> It's It's complex, but it's you can navigate it. It's navigatable. Um everything's going to come down to the paperwork, how things are structured and organized, what written agreements are are done between the parties, and what an actual party is legally allowed to do, and if they're allowed to provide those services. Because what I what I learned about lawsuits very early in my career as a lawyer was something that's called a fishing expedition, which means someone goes for treatment somewhere, even if it's in a yoga studio, let's say there's an IV drip, and they have an adverse reaction, they have an allergic reaction, something goes wrong, whatever it is. That person will be suing everyone. They're going to sue the building, they're going to sue the yoga studio, they're going to sell the business that So, you have to anticipate that all of those things are going to happen and that's why it's important to have certain provisions in the agreement when you're designing to say, you know, in the event that this happens, this is who's responsible. And to have communication with your clients that say, "Hey, before you participate in this service, you understand A, B, and C." So, space at Conscious Counsel, we call it a space rental agreement or it can be a sublease or a sublet. Um and those agreements are very, very, very important to have and I think that as the nature of these activities get more in the gray area of what's permissible, we'll see higher legal issues around it, which stresses the importance of having those documents in place.
>> Got you. Uh on a number of these um waivers, is there anything either related to maybe the the growth of like strength training and like Olympic squat racks and uh maybe some of the more, you know, you know, [snorts] strenuous activities, have you seen people try to tighten up their waivers to say, you know, "If you drop like a 500-lb bar on your back and you get paralyzed by doing that, like it's really not on me."
>> It's It's already covered, so the the important thing is that the waiver reflects the activities that you do, the risks of those activities, and the equipments that you use. So, typical situations that we've had problems with, um equipment being mounted on a wall and falling off,
>> Right.
>> mirrors falling on on people, cutting people, and people getting injured while working with a trainer and saying that the trainer pushed them too far or something like that. But, the waiver contemplates all of that and and the reason why we do specific agreements, customize specific agreements, is because like, cool, if you're an Olympic if you're an Olympic lifting space, you need we there are certain exercises we're going to specifically include in your waiver of liability as opposed to, you know, like a CrossFit waiver and a Pilates waiver are completely different. Uh and they should be because the activities are different. So, liability waivers of liability are always about what are the activities that you're doing and what are the risks of those activities and what equipment are you using in providing those services?
>> Got you. And then from a standpoint of the waiver, just to stick with this for a minute, is that something that that someone does with you as an example and then annually, you know, we have an arrangement where you kind of you guys go and update it for me or uh do you send out notices to people saying like, "Hey, there's been a change in your state for XYZ of something that might affect your legal documents" or is is any of that going on or should that be going on?
>> We we we started uh we started a membership at Conscious Counsel called Conscious Counsel Plus and I started this uh in uh in August of last year. And [snorts] the the whole idea of that is that we let people pay a membership and they have a constant ongoing relationship with us. So, it includes unlimited consults, unlimited support, you know, discounted prices on on future services. And most of our clients who who will get a package with us eventually will get into the membership because then when there's an update, we automatically reach out to them and send them. And uh and then we just like most of my clients I speak to on WhatsApp on a consistent basis, but to answer the question more directly, what you can do is anytime your services change, you have to update your legal agreements. So, that's something that's really important to know. And then secondly, sometimes there is a change that will take place. Like recently, there's been a change with the Americans with Disabilities Act, the ADA, that requires compliance both online and in person. Whereas it used to be just the ADA applied to in person wheelchair ramps, accessibility, now it's online as well. When something like that happens, we send out an email to our whole community and we let people know. But specifically as it relates to the waiver, the thing that you want to be in you want to make sure is that so long as the activities stay the same and the law doesn't change, then you can keep going. But, once you add new activities or if there's a change in law, we always send a reminder out to our clients.
>> Got you. And then uh in closing here, um you know, what would be the the the one word of advice for someone who's maybe cut some corners uh and wants to kind of get back on track, you know, what does that conversation look like or what is you know, what should my takeaways
>> It's it's really simple and it's just understanding the value proposition of investing in law. The same way there's a value proposition to investing with the right bookkeeper or the right accountant. In the same way that there's the right way to invest with anything in your business. And with law, eventually, it's like the one piece of advice I got from my mentor. He said to me, he's like, "Corey, when you get clients, you're going to tell them you can pay me now or you can pay me later. But, if you want to grow a brand, have a business, potentially exit it, not have legal issues, be in control of the situation, the one piece of advice I'd say is you want to be in control of the situation. So many of my studios, there's uh the star teacher that decides to leave and solicits all the clients. There's the owner who misclassified contract, you know, employees and contractors. There's the person who's about to get sued cuz the waiver of liability didn't include something. It's like, "Cool, you're running a business, you're going to be great. Work with professionals that that really understand what you're doing and have experience to preemptively um evade any of the issues. And and for everyone who's listening on on the Halo Talks, the best thing to do is you can just connect with us on Instagram @consciouscouncil and just write Halo, h a l o in caps letters, and we'll know that you came from the podcast and we'll be happy to have a conversation and do whatever we can to support you and learn about what you're doing.
>> Awesome. All right, man. Well, we love what you're doing. We deal with a lot of contracts when we're doing mergers and acquisitions. Some of them you have a sigh of relief on and others you kind of scratch your head. So, we're we're a big proponent of just get it done right correctly the first time and then you actually can scale. Um and then you don't have that shoulda, coulda, woulda. Uh if you actually looked at the documents prior. So, nice for coming on, man. Good to meet you. Safe travels.
>> I appreciate you guys having me. Thanks so much.
>> This is Pete Moore on Halo Talks. Your captain speaking. I'm the founder and managing partner at Integrity Square. We've been around now for 15 and 1/2 years. We have been helping people like yourselves get capital, do mergers and acquisitions, consulting, strategic advice in the health, active lifestyle, and outdoor Halo sector. Trying to help as many entrepreneurs as possible get to the next level. Take that inflection point and be the force behind your growth. We are helping companies that are have at least $3 million of EBITDA, around $10 million of revenue, and we are positioned to help you get institutional growth capital or to negotiate deals with strategic partners. If you go to integritysq.com/isq, you can see our capabilities deck. Happy to set up a consultation at any time that is free of charge. And we look forward to you helping solve obesity, loneliness, and diabetes. Go Halo.
>> Mhm.