How hard is it to start an agency?
As some of you know I've been trying to grow my video and podcasting agency for a while and it's slow progress. I haven't been doing nearly the amount of outreach and marketing I need to be to make a dent in revenue.
Still, I have some clients and recurring revenue coming in, but it's really hard to move the needle.
I've found some really helpful advice from other agency founders on my podcast who are openly willing to talk about their struggles of building an agency. A lot of them seem to have been in the industry for years and have built up the connections and client base to almost remove the risk before they even start.
On the most recent episode, I spoke with the Managing Partner of a startup creative agency in London called Wax/On. The thing is he has had a wealth of experience before starting the agency at places like Ogilvy, Karmarama and Edelman (in very senior positions). If you're interested the episode is here: https://geni.us/mm-12-web
I'm interested to see if any other Indie Hackers are out there trying to build agencies and if they have any breakthrough advice?
Hey, James. If you're growing and able to stay at it, it sounds like you're on the right path!
I have previously been a partner at two agencies and always experienced slow and steady growth, although that was a bit planned. I never wanted to go the "hire a bunch of people and do larger" projects route. I chose to stay small and lean so we could be selective with projects at times, always be ok with walking away when needed and not kill ourselves to make payroll.
Another agency friend recommended this book and it made a huge impact on how I started doing proposals and talking to clients. I found it super helpful: https://www.winwithoutpitching.com/the-manifesto
Hey! Thanks for the comment. That's the thing, it's really slow growth. Like a new client every few months slow. I've worked at an agency for the past two years and have a good understanding of how it works, but I think I've been being a bit lazy with it.
I absolutely want to stay small. When I was at the previous agency we went from a 10 person team to be acquired by a 800 person company and it was horrible.
Saying no to clients and picking good work is a luxury I've been afforded by doing it alongside a full-time job, so I'd definitely want to continue in that sense.
How do you find most of your clients when starting out? I know a lot of agencies end up growing organically through referrals and the network of the founders.
Always through my network and referrals. I also had good results from writing and speaking when I was involved with a few specific communities, like ExpressionEngine years ago.
We started our agency in early 2017. The first few months were stagnant, but around the four month mark things started going fast. It has been exponential growth, and earlier this year we hired our first full time employee to help keep up with demand.
The main problem with agency work is that many agencies tie income with time. This is a mistake. We productized our services (we do a sort of hybrid retainer model) and this allows us to provide the exact same service without ever even thinking about hours or billing. THis has allowed us to scale rapidly.
We’ve also seen good results from clearly defining our roles. I spend all of my days writing, working on our brand, emailing clients, and chatting with folks online. Seriously, that’s my entire role because it’s what I’m good at. Anya does a lot of the process management & accounting, we outsource a lot of content work, and our specialist does account management.
Agencies are either super successful or super hard. I think it was either luck or blind fortune that we were able to land in the former rather than the latter!
It's such a smart idea to productise services. I just read productize.co from @Vinrob and it really made me rethink how I've been positioning my services.
I love how you've clearly defined your roles and have been outsourcing the work. I definitely find I spread myself too thin and end up trying to do all the work myself in chase of profit over sustainability and growth.
How have you had most success finding new clients?
Through branding, really. We gave away a lot of really in-depth content at the beginning, and then we published a book earlier this year that did really well in our space, so I get a fairly constant stream of inquiries through email and LinkedIn.
Agencies are one of the easiest and hardest businesses to start. They are pretty easy to start because the business model has existed for 1,000 of years. I can guarantee you that there are 100s, possibly 1000s of potential customers interested in your services. Many other businesses(especially the type on IH)don't have that luxury.
However, they are also hard because usually with agency type of work you are selling time for $. If you want to take a vacation, or anything like that you are losing money. This is amplified when you hire your first employees. If you are low on projects for the month, you really lose money as you have to pay them to do nothing, or risk them leaving you for another job.
I have never started my own agency, but I have worked for several and freelance. The best way to grow is just to make yourself as well known as possible. Contribute to IH meetups, attend trade shows, speaking engagements are huge if you can land them.
Good luck on your journey!
I think you're totally right. I've worked for an agency for the past 2 years and I knew I had skills that I could sell pretty easily as a service. Working for the agency (10 people) really opened my eyes to the realities of it, especially when we went through an acquisition.
Your point about having a large market and the business model having been around for so long is what draws me to it. I've been involved in agency life for enough time now that I want to go out and really push myself to make it work.
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