289 - Best of 2025! How a Former Lawyer Built an 8-Figure Sky Lantern Empire with Spencer Humiston

0:00That was about two and a half million dollar event. Really? One weekend? Yeah, one weekend. We do about eight to 12 of those events a year. And anywhere from 100 to 150 ,000 people come out to those events across the country. This is like, honestly, one of the scariest things for me that always leaves me up at night. Let's just say you have an event that does a half million dollars in revenue. And you've done, say, 90 % of that revenue a week before the event. If that event doesn't go off, you're on the hook for that$490 ,000 to be refunded. But you didn't actually make that money. That money already has a bunch of associated costs with it.

0:35Up until you get the event off, you're running in the red.

0:42I'm technically a lawyer. I have a law degree, which has been of varying use throughout my life. I thought for about 10 years, I thought it was of no use. But I found it to be of a little use. I feel like the nature of entrepreneurship is there's always some sort of you're going to get sued. So I'm having Leo backgrounds help with that. About seven years ago, I founded a company called Nightlights, which does Sky Lantern festivals around the country. One of a couple of businesses that do it, I was there at the very beginning when we first came up with the idea of doing it in America. It's based around Thai or Chinese Sky Lanterns, those types of festivals.

1:17So I love to talk about that. There's a ton of misunderstandings about it. I think that a lot of misunderstandings get to the heart of entrepreneurship as well, about where people are like, how can you possibly do that without understanding all of the work that goes on to make sure you can keep doing it. The other things I do is I'm involved. We've taken that and then partnered with a large country music festival south of Dallas. And that's been incredibly fun. I own a lime farm in Oaxaca, which has not done well. A what farm? Like limes, like the citrus fruit. Yeah, yeah, okay. Yeah, that's been terrible.

1:53We've also started a company that I'm incredibly proud of called Great Crowd, which does marketing and ticketing for events similar to my event. So it kind of was an organic extension of what we do, kind of serving the marketing and ticketing needs of mid-size events. So not like a fun run, not like a Taylor Swift concert, but something that kind of sits in between. Can you give me an idea of size and scope of those businesses? Maybe like, hey, total combined, here's top line revenue and here's a number of employees that we have, number of states we operate in, just something to give me context.

2:25Top lane revenue is really depending on the year, depending on a variety of factors is somewhere between four and six million dollars in revenue. Wow. I mean, it's a massive amount of marketing goes into that and you continue to have to market the idea of like events are going to go viral and you're going to sell a bunch of tickets doesn't really exist anymore. And then there's a million other little costs in there. But we do that. We do about, depending on the year, eight to 12 of those events a year. And we have out anywhere from 100 to 150 ,000 people come out to those events across the country.

3:00So, oh, my gosh. So eight to 12 events a year. Those are going to be like eight different locations, you're saying. Yeah, totally. So we have eight locations. Well, eight different locations. And then at those locations, we might do multiple events. So we might do multiple weekends or we might do one in the spring. We might do one in the fall. So we move. Most of the events we do are in May, early June, and then we are in September, October, and early November. Insane. Okay, so then you've got the Lime Farm. Yeah. Random. In Oaxaca. Yeah. And then tell me a little bit about the Country Music Festival because that's super interesting.

3:36Yeah, Country Music Festival is actually incredibly interesting. When we dreamed up Night Lights, we wanted to bring on live artists. We kind of had this idea that we'd have really cool live musicians. to be completely honest, like the cost was prohibitive for live music. And then also we found very quickly that what we were paying for live musicians wasn't pushing the revenue. So if you get a band that someone's heard of, you have to pay$20 ,000 for it versus you get a guy who's just, you know, a singer songwriter at a local bar, we're going to end up selling about the same amount of tickets.

4:07Oh, interesting. And so, but we ended up teaming up with a venue that we had done our lantern event there, they were looking to do kind of a country music festival to kick off their week of drag racing. They do nationals for drag racing. And we really felt like partnering nightlights with them could lead to kind of make the concert stand out. You see country concerts all over the place, but doing a lantern release before the opener or during the headline act, we thought would drive a different crowd out to it. And so we've done that now for three years. This year was the first year I think we really felt like things really broke and it did really well for us.

4:50How many people attended? Can you like, yeah, yeah, yeah. I mean, I can get those numbers. Over the course of the weekend, we had between 25 and 35 ,000 came out to it. So we did this year and some of those are multiple. Some of those are single day. We did three days. We did a Friday night, a Saturday, and then a Sunday. Yeah, that was awesome. Can you give me an idea? Top line revenue? Yeah, I can do that one. So that one did about, I mean, this is just the top line revenue of ticket sales. Sure. And all this stuff is always merge and F &B. But that was about a$2 million,$2.5 million event. Really?

5:25Yeah. One weekend? Yeah, yeah, yeah, one weekend. What? That blows my mind, dude. You're saying it's so cool. And I couldn't tell if you were not wanting to say it because you thought it was low or maybe you thought it was high. I don't know. But like that's one weekend. I mean, I know there's a lot more work than just one weekend that goes into it, but that seems crazy to me. Yeah. And there's economics involved in that kind of stuff. I mean, artist budgets are huge. If you want to throw a concert, that's going to have like main names. I mean, stages are a big deal. And then of course, like the amount of marketing that goes into pushing that.

6:00It's crazy because we talk about it all the time, but like events, we say it all the time, like everybody's an e-commerce company now. like literally everyone's e-commerce company. Because most of your tickets are sold off of Instagram or Facebook, you're competing with every other e-commerce ad that people are seeing on there. And so a large part of our costs are towards ads like that. That's pretty incredible. And then this new business that you've launched, which sounds like digital marketing for similar events-based businesses. Yeah, yeah. So digital marketing and then the ticketing platform for them.

6:34We just kind of found very early on that, you know, we're not like a neighborhood fun run, but we're also not like a Taylor Swift concert. And so Ticketmaster isn't going to kind of give us the time of day. They're happy to take your money. But then also like, you know, the next door guy who developed a ticketing platform, not going to be able to, is robust enough to deal with 100 ,000, 250 ,000 different orders a year. And so what we tried to do was figure out how to cater to events like ours, both with the marketing and the pricing, dynamic pricing strategy, and then across the entire sales cycle and having your ads tied to those with then the ticketing being the last step.

7:17That's marvelous. Yeah. When did you launch that one? We launched that. We soft launched it in 2021. It was right after COVID. And all we just ended up doing was taking the money that we were dumping into ticket processing on a third party, hired an engineer and just had him cobble together a solution for us for nightlights. We found it to be incredibly useful and then started kind of rolling it out to people that we do business with. So Spencer, you've got businesses that are essentially doing at least$10 million top line revenue-ish. I'm just doing some back of the envelope math. You live in Utah, but you've got an event in Dallas and you've got at least 12 events for nightlights around the country.

8:02I don't know where your marketing team is based, but I'm assuming they're not all based locally. But if I'm looking at you as an entrepreneur starting out, I'm like, man, this guy's got an eight figure business. He's got multiple locations that he's running. He's been doing this for a number of years. It would be pretty intimidating, right? Like looking at this and thinking, holy crap, how did he do this? Was this your plan seven years ago when you started this? So like, what, what was the thought process behind? Hey, I'm a lawyer. Let's get into lighting lanterns on fire and setting them free.

8:28yeah no not at all and honestly as you describe it that way it also sounds much and i think maybe this is the nature of most entrepreneurs it sounds much bigger than it actually feels most days all right now's the part of the show where i feel the most uncomfortable but my therapist says i need to face my fears so here we are i've started a newsletter and i want you to subscribe and what you're going to get every single week are the aggregated conversations from that week that i have on this podcast with an overview of what their business actually looks like i'm also going to throw in a review of one or two businesses that are listed for sale.

8:59I'll give you my opinion on whether or not the EBITDA multiple is good, or there's customer concentration, or there's red flags or green flags. And then lastly, I'm going to give you one piece of actionable advice every single week on how to buy your first business. So click the link below, subscribe to my newsletter, and let's get back into the show. I feel like for me, it's like you solve one problem, and then another, and then another, another, and it just kind of just ends up building into something else. You know, it's like, yeah, so I wasn't planning on any of this. I actually, I had a buddy who was big into events.

9:29And he was involved in those really long marathon, like the relay. Ragnar. Ragnar. Yeah. He started a company that did mud runs that was incredibly successful around the country. At the same time, I was finishing law school. He had visited us in Thailand. We were living in Thailand and we let it off like sky lanterns together. And he was like, this would be incredible in America. And I was like, there's no way you can do this in America. We left Thailand, moved to Alaska and started working there as a lawyer. He was having trouble getting it off. So he tried to do the invention of America, but between fire codes and a bunch of different other things, he was having trouble doing it.

10:10And he called me and was like, Hey, hey, what are you doing? I told him, I was like, you know, I think probably gonna, this is real talk, probably kill myself if I keep doing, like everyone laughs about it, but like, honestly, like I've spent like years of therapy over it. Like if I keep doing this, it's just not, it's just not cut out. I'm not cut out for it and it's not a good fit. And so I helped him get this going, the Sky Lantern thing going really early on. I just saw the myriad of problems around it, like what happens to the lanterns, picking him up, making sure you're not causing fires.

10:43I mean, those are the two big things. Like, are you going to cause fires? And isn't this litter? That's what I was going to ask. Cause like, first of all, I think it's funny because I lived in Tacoma, Washington, which is not Alaska. I could see practicing law. If you don't like law and both of my brothers are lawyers. So I get it. And you live in like Alaska where seasonal affective disorder is like night or the year. Cause you don't see the sun. Did he call you because it was your idea? Like, because you guys did it together in Thailand or did he call you because he's like, hey, you're a lawyer.

11:10Could you help me figure out some of this zoning, you know, whatever, requirements out? We were kind of buddies and like they'd come up and visit. Him and his wife would come up and visit. We were kind of like, I don't know if we can stay up here. Like I'm not doing this well. He's like, I've actually done this. We kind of got it off going. It was based upon what we did in Thailand. He had another company that he wanted to put most of his time into, another event. And he was like, we just need somebody who seems to have like a skill set around law. at the beginning events are like 99 % just like problem solving.

11:40There's just not really anything else behind it. You don't need a specific skill. You just need a willingness to like, I want to make this happen. How does it happen? Walk me through some of the legal stuff. Cause I'm sitting here. I'm like, you light this thing on fire and then you release it. This is me like ignorant me, right? Yeah. Like if you're releasing them in anywhere in the West during the summer, like that's just the wildfire waiting to happen. And so it just screams legal liability. Right. It's super cool looking, but obviously it's a, it's a thriving business. What were some of the logistics that he was having problems with?

12:13Well, they're ongoing as well. I mean, that's, what's kind of interesting about it is it's like, so like, I mean, logistics are, is like exactly what you said. It's like, Hey, you're going to light flaming garbage into the sky and then just like ghosts. But I mean, we, that's not a sustainable business model at all. Like, right. I mean, it's not like, it's like, you're going to, and it's funny because it's like one of those things we get on Facebook, the feedback's always like, that's what you guys are doing. It's like, well, you can't do that in America. You can't just like light garbage and then take off.

12:43And certainly you can't come back to the same town and do it over and over again for like eight years. So the biggest thing we kind of ran into early on was the fire concern. It's just not a concern for us. They're essentially a little, the fuel stem is like a little tissue packet of wax paper. So it burns from like somewhere between three to five minutes. It takes about usually a minute and a half, two minutes to actually fill up the lantern. So it's actually burning in the air for about a minute, minute and a half. And then it's just physics. It only starts to come down. It starts to come down when it's no longer burning.

13:18Yeah, yeah. And so like now, and like when I was trying to sell that to people, like initially, they're like, cool, that's not true. true but now i kind of feel like after we've done a million and a half of these things they've never started to fire it's kind of like well that's actually it's funny like i'll go to talk to fire chief still and i'm like there's literally no one on earth that knows more about sky lanterns than i do we just have never started fire so that was that was the first issue is like fire you're right about the west we do work like super closely with fire chiefs work in places where there's a ton of like they call it defensible land so like usually like it's a It has like large open fields next to it.

13:57If it's in the, if it's in the East, it's a place that is like well vegetated around it. We work, we try to work. And that's why we usually do it in the early spring or fall is when it's a little wide and don't have as much fire. Yeah. Yeah. And we work incredibly closely with fire marshals. So they'll be like, Hey, we're actually comfortable with it. You know, and we give up discretion to them as well. So it's a red flag day. Did you have to get a bunch of liability insurance before you launched this business or no? So this was crazy about it is we do have insurance. We've always had insurance.

14:26I don't think the insurance rates were much harder than any other large event. Insurance is like a black box. Anybody who has had to deal with insurance, like I have no idea. Like you find out people are insuring the insurance. I mean, it's like reinsurers. And yeah, there's reinsurers of reinsurers. Like I don't even know. Like that seems insane. And I think it's because we don't we don't do a lot of personal injury stuff. structure damage stuff like that just isn't that expensive did you have to do a bunch of groundwork right like anytime that you had like where was your first location where did you do this first yeah the first location was outside of spokane in spokane you're going up to spokane do you have to get permission or could you just light these off like i have no one no one knows no one knew yeah like no one knew like that was the thing is no one knew and so we're it was funny the place we and no one knew like what the ideal situation for this was right like you do it in a city park the biggest thing was we had to clean them up like that's the thing like we had interns so it was kind of like how do you do that that was kind of the thing that well there's two issues parking this is the this is the thing for all public events parking on-site parking is like a deal breaker it is like and it is like it is the biggest thing that's the biggest choke point on venues and whether or not - In the event space business, parking.

15:46Yeah, yeah. People, honestly, it's like a huge deal, like parking, because like anytime you're doing shuttles, anytime people are having a parking station, it's a massive pain in the ass. So like onsite parking is like a giant prohibitive factor of the ability to be able to do events. To be 10, 15 times the size of the actual event space to bring things in. So it's where can we park, where can we park cars for 10 ,000 people? So you're looking at where can you park 3 ,000, 3 ,500 cars? And then where can you pick up these lanterns afterwards? And essentially, it's like you need to have pretty open spaces around it.

16:19The lanterns travel very far. So that's honestly something that's like a huge deal for us as parking lots. I cannot stress enough that that ended up becoming a massive prohibitive factor. And it's like one of those things that we keep seeing event spaces around the country. It's like dudes who just have a massive parking lot. I'm serious. A giant parking lot, whether it's a big field or whatever, and has fairly easy access. So they're not going to jam up traffic for hours is a huge deal. And it's also become, if you look at music festivals, EDM festivals, all sorts of things, the massively prohibitive thing, because to have people be able to park conveniently is like, that's a huge deal.

16:58That's so fun. Like, I would think with events businesses, you're worried about the ambiance, the vibe, who's coming, what does it look like? How does it feel? And you're like, if your parking sucks, like it doesn't like all those other things don't really matter. I mean, they matter, right? But if parking is an issue, then that's the first thing that they're experiencing. So of course they're going to have a bad experience, right? It's the first thing that they see when they're coming. Oh, 100%. Like we talk about like really cohesive experience. So like I kind of feel like your customers start experiencing with you the first time they see your ad, right?

17:30So like your ad all the way through to the follow-up email at the end of it should be seen as one cohesive, seamless process. And I think you're judged as a company. You're judged as what you're doing from every single one of those moments. And so the way I've always kind of thought about it, it kind of breaks down into two different things. There's the entire pre-event experience, which is the ad all the way through where the person leaves their house for a day. That's the ad. It's the ticket buying process. It's the follow-up emails. It's the text messages. is it's every every communication with your customer or the attendee until they leave the house that morning it's the cs side of it what's cs sorry like customer service okay so if like are they able to get questions but it's their interactions on other social all your social media platforms all those things will will drive so so personally i want to go see sky lanterns and they'll go do it and depending on how good that interaction is i think contributes to how excited the person is to come out to your event.

18:34And if you're screwing those things up on the front end, you're going to end up with people that are coming out and doing it, but they're already disgruntled. It's the weirdest thing about events is that people like can already be like, well, I want to do this, but I have a bad attitude about it. It's wild. Once you have them at the event, the venue, that's a whole different thing. And you're 100 % right with parking. Like we've seen it happen all the time. Like if there's traffic, bad traffic coming into the event, the entire vibe of the event for the first two or three hours is affected by that.

19:03Like people having to wait in their car for 40 minutes, an hour, hour and a half in a traffic jam. Those people, once they come into the gates, are in a different mindset than if that stuff goes seamlessly. So yeah, it's wild, but the traffic and parking is like a huge part of events. Why was Spokane your first event? So we found really early on that the best place to do this is racetracks. Like one of the best places to do it. So like they're usually, it's changing now in the last 10 years, but they're usually in fairly rural places. They're usually surrounded by pretty open land. Kind of think about like, you know, a county racetrack or like a, I don't mean horse racing track, I mean like a car racing track.

19:43Because they're loud, right? Like it's like, hey, nobody wants to fix their house. Yeah, yeah. So like 40, 50 years ago, they built them out in the middle of nowhere because they're loud and nobody really wants to develop around them. Yeah. And so you don't have like big developments around them. so it's usually like horse pasture i'm in the west there's a lot of places that sit right on blm land yep and so yeah they're loud and so and they also have parking lots because race because racing was huge in america like 30 40 years ago so a lot of these guys would bring in 20 000 people and they built parking lots for 20 000 people in the 70s your friend calls you up and he's like hey i'm trying to figure out how to launch this i want to do this thing you're not happy in alaska you're like yeah man let's let's roll and the first thing you start doing is like you know what i think racetracks are probably where we should build this business around like how did that kind of roll out yeah it didn't it didn't go that way at first it kind of went it was just kind of like throwing whatever at the wall thinking like okay well we can't do it in a city like we can't do it in city parks because it really the factor was we have to clean up these lanterns and so if you're doing it like right next to a neighborhood it's like how are you going to go clean those up so it's kind of started looking at like so you have to like literally go and pick up every lantern we do incredibly well with it yeah we pick up you have 25 000 people come to an event you're picking up 25 000 lanterns yeah we never did i mean about 15 000 is about the maximum we can do at an event okay scale it pardon me i'm sorry 15 lanterns right like yeah it's crazy we pick them all up and it's it's especially easy in the west where it's kind of open field it's easy in texas The East Coast is a little harder because there's trees, but we will do several rounds as they get blown out over the course of like the week or two weeks that they come down.

21:22And the first event we did it, I remember they all kind of blew into this feel and it just looked like they went forever. And I was like, we're never going to do this. Like it's never, we're never going to get these things picked up. the wild thing and no one believes it is that with a crew of about 15 people we can pick up all of the lanterns in about four hours five hours dude that's nuts it's nuts it's crazy are they the same crew or is it like every city that you go to you're like hey whoever wants to come pick up lanterns with us probably don't need a yeah we yeah it's not like licensed So like licensed lantern picker.

22:02We have a crew of anywhere from seven to 10 people that are full-time employed at other jobs who come out and run our events. So think like a ticket manager, a parking lot manager, a stage manager, an infield manager. And then we, depending on the size of the event, we work with either nonprofits, local sports teams, club teams who want to do fundraisers. And we, those are the people that then staff most of the things. How much does it typically cost for, like, let's say I wanted to take myself and my, the five members of my family, right? My wife, my four kids. How much does it cost me to go?

22:42Does it, is it a different cost if I just want to see it versus if I'm actually want to set off a lantern? Yeah, we only, we only do, you have to come in and do the whole thing. So there's, there's no just like looking at it. You actually have to come in. And that's kind of one of the things that we've done really well is we structure our ticket pricing differently depending on the country. And then also depending on the sales cycle. So if you bought tickets, say, a year before our event on Black Friday, your tickets would end up being about 50 % less than if you bought it ahead of time. But we kind of go for an average ticket price on an event.

23:16So like if you came down to Salt Lake and did ours, it would be about, I think our average ticket price over the cost of the entire sales cycle is somewhere between$35 and$40 a person. So I get that you have to have lantern picker rippers, licensed, excuse me, licensed lantern picker rippers. What does the back end look like? What is your, what's the rest of your team that's probably full time throughout the rest of the year? What does that look like? It's real. And I think this is something I'm actually incredibly proud of as an entrepreneur. Or like I've kind of said that like if you're looking to hire people and you're like at the beginning of a company, so zero to one or even one to two.

23:52I know that's not a real thing, but I feel like it is. If it's like zero to one, one to two, and you're looking to hire somebody, it just means you're lazy or you haven't thought enough about doing it yourself. I feel like that's the truest thing in the world to a certain extent. And I think once you've gone through that, am I being lazy? no I actually like I can't do this or have I not tried to figure it out hard enough myself and like no I actually have tried to figure it out myself and I can't I can't do it then you hire and most of that stuff ends up just being incredibly specialized stuff accounting people that are really good at digital marketing and so what the team looked like is that I have two people that work for me full-time that do the logistics so do what you would consider like a COO logistics.

24:41And then we have somebody who does full-time operations. So actually they are the head of the person at the event. I don't step on their toes. I never really have too much. And then we have a third-party marketing firm that does most of our marketing. Are you planning on like bringing that in-house at some point because now you have the marketing company that you just launched or no? Well, that's him. Over the course of the year, we became like such good friends and we were incredibly good clients. Like we were like good clients and then we just ended up building this together. So he still has his own marketing company and now we are doing this more integrated marketing ticketing platform.