I have a couple of uneasy questions, feel free to reply to those that you feel comfortable answering:
If you make 40k MRR, what's your profit %?
Are your designers happy about the service they provide, and that is, have to work a lot for a very small amount of $$ considering UI/UX designers in the west are paid $50 an hour or more
How do you feel about the growing competition for many others companies doing what you pioneered (Manypixel was the first agency I've seen doing this unlimited model, kudos!) ?
Currently our profit margin is between 25 to 50%. This month it is closer to 25%!
We have a team of designers in Indonesia. We pay them more than twice the average graphic designer salary there (sometimes even 3x that amount or more depending on the seniority) and we finance them a MacBook Pro (they have to pay 5 to 10% of the original purchase price every month)
The focus will always be on our customers and trying to see how the market will involve. Today anyone can replicate Manypixels but what is important is answering the following question "Will people order design services in the next 2, 3, 5, 10 years as they do today?", probably not so we have to build the future a little bit in advance so we remain competitive I guess!
3
Finding the right problem to work on > Having the perfect solution
That's an interesting and important point; there's so much noise about ideas not having value, but try working on the wrong thing for a year, and you'll really see something without value.
2
How on earth do you get your content to be read? :)
1
Not an expert on this but basically I always try to provide valuable content + entertaining and... if possible content that hasn't been already written about a thousand times.
We also focus on one specific type of post: Behind the scenes posts / transparency posts.
1
And when you have written the content, do you just wait for google to index it?
How do you get people to read it?
2
I mostly post it on HN/Reddit/IH and on Facebook groups.
1
Thanks for sharing your tips :)
I enjoyed the read!
2
Hey Robin, great post.
I had a question about your operations. To validate the product you threw together an MVP with a "Purchase" button and started getting your first few orders.
Once these users have paid, what was your process of delivering the service?
It seems to me that the first version was basically just a way of paying for the service differently (flat fee per month), but the actual operation of the business was the same as if you were freelance: sending specifications, validating needs, delivering, etc.
Did you have a dashboard, or even simpler like a set of Google Forms where customers could place orders that made it feel like a product?
I'm asking because I'm very interested in productizing a service that we currently provide, but besides the pricing and the way we present the service, the actual operation stays the same. I want it to feel like a product from the moment the user finds us to the moment we deliver.
1
Hey Steven, thanks!
You're spot on: At the beginning it was very, very basic. We were only providing a design "retainer" service and everything went through email. No dashboard, no structured brief: We just asked a couple of questions via email.
So you're right at the beginning we were not a productized service.
The only way to "productize" is to create very clearly defined "service packs" where you exactly say what you'll do / what you won't do, for how much, with which steps, at which speed, etc.
A good way to do so is by breaking your service into "pieces" and thinking of an assembly line where the customer will review separate items of that whole project.
Productized services are more about customisation than creation from the scratch (which is what services are about)
1
Right, and is this being communicated before the user pays or is it done after payment? Like you send a welcome email saying "here are the packages you can pick from and their timeframes"?
1
Correct - they get an email afterwards with access to the platform.
1
Great post! I was wondering whether you were a coder/programmer? If not (or if so) how did you go about developing your MVP site? Did you use wordpress, Wix or some other tool or did you program everything yourself? If so what tech stack did you use and where did you continue development? Thanks!
1
Hey Zaid! Not a programmer, I bought an HTML template and then added Paywhirl to manage subscriptions.
1
How can a designer join manypixels.co? I don't see anything on the website.
1
We do technology & consulting at my practice, and we've been contending with developing 1) something that can scale; 2) something that can be a self-service offering with a "sign-up, buy now, pay" funnel right on the homepage. In the consulting biz, there's a long, long, long sales/proposal/close/begin cycle. Interested in this for digital marketing, SEO, WordPress, e-commerce and/or (ethical) growth hacking.
In particular, we've been doing very horizontal, full-spectrum servicing for our customers, and we've been brainstorming on a more vertical (narrow) "you give us one of your KPIs, we'll design a plan to improve it, and implement it if you're ready to go" kind of offering.
NB: None of the links in your site's footer go anywhere. All go to "#".
1
Very good idea on the niche like "You give us one of your KPI and we offer you a solution to improve it". People when ordering services want the certainty of having results and when you "sell" results you're gold.
Thanks for the heads up for the footer, will fix!
1
Hi Robin, interesting article :) , thanks for your details
I would like to ask your opinion about trying the same business model of productizing a service but for development agency
We are running a development agency [http://ventaapps.com/] for 6+ years now, we are focused on mobile and web apps development
I have seen many design-focused startups using the model like yours,
I'm trying to evaluate if that business model could be suitable for development services also, What do you think?
2
@engmsaleh I definitely think our model can work for other industries!
My biggest advice would be to really come up with service packs. Try to come up with something that a lot of people need developed or fixed (and if it is on a recurring basis that's even better) and try to put together a service pack with immense value. I know it might seem vague but one way you can do it is by looking at your problems or looking at development/fixing bugs types of projects that have a very low customer satisfaction / high level of distrust. Then you come in, put together a service pack, your customers trust you and you guarantee their satisfaction --> That's what productized services are all about IMHO!
Finally I just want to say something: We were also lucky and what worked for us might not work for others. So do your own thing, try a lot and always provide value!
1
I really appreciate your input Robin
I will try to think of a good value and package and test it out :)
1
Human service vs Digital Commodity:
In the design space, the most common needs that people have are usually straightforward. But for web/mobile app development complexity makes the whole story different.
What I have seen people do is build platforms/products/tools that helps other people do what they do manually in the logo design, animation and video making space.
This is the direct opposite of hiring more people to deliver the service.
1
I think you are right in the point of hiring more to deliver the services ... the point is that what we actually currently doing without productizing the service ... we hire more to compensate with our workload
The catch is that the number of projects that we work on isn’t constant and are variable all the time which doesn’t make a sustainable revenue which is the major drawback in our current business model
The point of making an automated process is largely dependent on the projects which are mostly variable and find a commonality is very hard in my opinion
I have a couple of uneasy questions, feel free to reply to those that you feel comfortable answering:
If you make 40k MRR, what's your profit %?
Are your designers happy about the service they provide, and that is, have to work a lot for a very small amount of $$ considering UI/UX designers in the west are paid $50 an hour or more
How do you feel about the growing competition for many others companies doing what you pioneered (Manypixel was the first agency I've seen doing this unlimited model, kudos!) ?
Hey @orliesaurus !
Currently our profit margin is between 25 to 50%. This month it is closer to 25%!
We have a team of designers in Indonesia. We pay them more than twice the average graphic designer salary there (sometimes even 3x that amount or more depending on the seniority) and we finance them a MacBook Pro (they have to pay 5 to 10% of the original purchase price every month)
The focus will always be on our customers and trying to see how the market will involve. Today anyone can replicate Manypixels but what is important is answering the following question "Will people order design services in the next 2, 3, 5, 10 years as they do today?", probably not so we have to build the future a little bit in advance so we remain competitive I guess!
That's an interesting and important point; there's so much noise about ideas not having value, but try working on the wrong thing for a year, and you'll really see something without value.
How on earth do you get your content to be read? :)
Not an expert on this but basically I always try to provide valuable content + entertaining and... if possible content that hasn't been already written about a thousand times.
We also focus on one specific type of post: Behind the scenes posts / transparency posts.
And when you have written the content, do you just wait for google to index it?
How do you get people to read it?
I mostly post it on HN/Reddit/IH and on Facebook groups.
Thanks for sharing your tips :)
I enjoyed the read!
Hey Robin, great post.
I had a question about your operations. To validate the product you threw together an MVP with a "Purchase" button and started getting your first few orders.
Once these users have paid, what was your process of delivering the service?
It seems to me that the first version was basically just a way of paying for the service differently (flat fee per month), but the actual operation of the business was the same as if you were freelance: sending specifications, validating needs, delivering, etc.
Did you have a dashboard, or even simpler like a set of Google Forms where customers could place orders that made it feel like a product?
I'm asking because I'm very interested in productizing a service that we currently provide, but besides the pricing and the way we present the service, the actual operation stays the same. I want it to feel like a product from the moment the user finds us to the moment we deliver.
Hey Steven, thanks!
You're spot on: At the beginning it was very, very basic. We were only providing a design "retainer" service and everything went through email. No dashboard, no structured brief: We just asked a couple of questions via email.
So you're right at the beginning we were not a productized service.
The only way to "productize" is to create very clearly defined "service packs" where you exactly say what you'll do / what you won't do, for how much, with which steps, at which speed, etc.
A good way to do so is by breaking your service into "pieces" and thinking of an assembly line where the customer will review separate items of that whole project.
Productized services are more about customisation than creation from the scratch (which is what services are about)
Right, and is this being communicated before the user pays or is it done after payment? Like you send a welcome email saying "here are the packages you can pick from and their timeframes"?
Correct - they get an email afterwards with access to the platform.
Great post! I was wondering whether you were a coder/programmer? If not (or if so) how did you go about developing your MVP site? Did you use wordpress, Wix or some other tool or did you program everything yourself? If so what tech stack did you use and where did you continue development? Thanks!
Hey Zaid! Not a programmer, I bought an HTML template and then added Paywhirl to manage subscriptions.
How can a designer join manypixels.co? I don't see anything on the website.
We do technology & consulting at my practice, and we've been contending with developing 1) something that can scale; 2) something that can be a self-service offering with a "sign-up, buy now, pay" funnel right on the homepage. In the consulting biz, there's a long, long, long sales/proposal/close/begin cycle. Interested in this for digital marketing, SEO, WordPress, e-commerce and/or (ethical) growth hacking.
In particular, we've been doing very horizontal, full-spectrum servicing for our customers, and we've been brainstorming on a more vertical (narrow) "you give us one of your KPIs, we'll design a plan to improve it, and implement it if you're ready to go" kind of offering.
NB: None of the links in your site's footer go anywhere. All go to "#".
Very good idea on the niche like "You give us one of your KPI and we offer you a solution to improve it". People when ordering services want the certainty of having results and when you "sell" results you're gold.
Thanks for the heads up for the footer, will fix!
Hi Robin, interesting article :) , thanks for your details
I would like to ask your opinion about trying the same business model of productizing a service but for development agency
We are running a development agency [http://ventaapps.com/] for 6+ years now, we are focused on mobile and web apps development
I have seen many design-focused startups using the model like yours,
I'm trying to evaluate if that business model could be suitable for development services also, What do you think?
@engmsaleh I definitely think our model can work for other industries!
My biggest advice would be to really come up with service packs. Try to come up with something that a lot of people need developed or fixed (and if it is on a recurring basis that's even better) and try to put together a service pack with immense value. I know it might seem vague but one way you can do it is by looking at your problems or looking at development/fixing bugs types of projects that have a very low customer satisfaction / high level of distrust. Then you come in, put together a service pack, your customers trust you and you guarantee their satisfaction --> That's what productized services are all about IMHO!
Finally I just want to say something: We were also lucky and what worked for us might not work for others. So do your own thing, try a lot and always provide value!
I really appreciate your input Robin
I will try to think of a good value and package and test it out :)
Human service vs Digital Commodity:
In the design space, the most common needs that people have are usually straightforward. But for web/mobile app development complexity makes the whole story different.
What I have seen people do is build platforms/products/tools that helps other people do what they do manually in the logo design, animation and video making space.
This is the direct opposite of hiring more people to deliver the service.
I think you are right in the point of hiring more to deliver the services ... the point is that what we actually currently doing without productizing the service ... we hire more to compensate with our workload
The catch is that the number of projects that we work on isn’t constant and are variable all the time which doesn’t make a sustainable revenue which is the major drawback in our current business model
The point of making an automated process is largely dependent on the projects which are mostly variable and find a commonality is very hard in my opinion
This comment was deleted 2 months ago.