Many of you may already know that I am a PASS regional mentor for the South Central region of the United States.  My role is to help user group leaders obtain the tools they need to have successful groups and provide an open platform to discuss challenges and successes.  One of the groups in my region asked me about how to handle the monetary part of hosting a pre-con for their upcoming SQLSaturday.  My response was to explain three different methods that I have seen others use.  What I wanted to do was use estimated costs to give a clearer picture of what everyone walks with at the end of the day.

 

Option 1 – This option takes all costs out of the gross profit prior to splitting the net profit.

Gross Profit – Venue Cost – Lunch Cost – Travel Costs = Net Profit

Net Profit is split 50/50

Let’s put some numbers into that equation to better understand what the speaker and UG would stand to profit.  I usually see most precons set at $125.  Some will give an early bird of $99 and then raise it to $125 at a certain date, but we’ll keep the math simple.  Let’s assume we get 15 people to attend at $125 each.  That gives us a gross profit of $1,875.  Finding a free venue for a pre-con is far easier than that of the SQLSaturday, but we’ll assume it costs $100 for cleaning and facility services.  We’ll also guess that lunch is $15 a person and would cost a total of $225.  The last part is travel and we’ll guess 2 nights in a hotel is $240 (technically it should be 3 days, but the third is for the SQLSaturday so we won’t count that) .  Flight costs can vary and I’ve personally paid as little as $200 and almost up to $400 so we’ll go with $300 to be in the middle.  Let’s plug those numbers in and see what we get.

1875 -100 -225 -540 = 1010

1010/2 = 505

Both the speaker and the user group will have a net profit of $505.

 

Option 2 - This option has the speakers pay for their travel, but the profit is split 75/25 favoring the speaker.  If your user group is a larger or more financially sound group this is an excellent option.  From a user group standpoint all you really want is enough money to help with meetings.  For the smaller groups a SQLSaturday pre-con can fund an entire year of meetings.

Gross Profit – Venue Cost – Lunch Cost = Net Profit

Net Profit is split 75/25

1875 -100 -225 = 1550

25% of 1550 = 387.50

75% of 1550 = 1162.50

With this option the UG gets $387.50, but the speaker still has travel costs so subtract $540 from his profit and he gets $622.50.

 

Option 3 – This option is what most folks used to do and I suspect many still do.  However, most groups opt for one of the options above these days.  I suspect the reason this option has lost popularity is because it doesn’t attract speakers with the lower profit margin.  Look at the numbers and you’ll see what I mean.  If the flight or hotel cost was higher or the speaker had to rent a car (which I did not even factor in, but is extremely common) then the speaker would be lucky to even break even and might even lose money.

Gross Profit – Venue Cost – Lunch Cost = Net Profit

Net Profit is split 50/50

1875 -100 -225 = 1550

1550/2 = 775

So here the UG gets $725 and the speaker after travel costs gets $235.

 

I hope this helps for anyone out there hosting a pre-con to at least be able to plug some numbers into these options to make a more informed decision for your user group.  The other thing to factor in is that most SQLSaturday events that host a pre-con actually host two or more sessions.  That means the profit doubles or triples for the user group, but the speaker profits from above will remain.

So these are the 3 options I have seen used, but I’m curious if anyone else is using a different method.  If so, please post it in the comments for everyone to see.  I’m also curious what method your group is using and if this post made you think about changing it.