We’re one month away from the start of the year when the Twittersphere was abound with resolutions and medium posts on ‘new direction’. I’m a bit late to the party.
Here is a post on my new direction. That’s strange, I usually say ‘Our’. I’m used to talking in the third person. This is a post about where I am at. The transitions that my agency Raison have taken and what is in store for 2016.
I’ll set the scene somewhat. For five years I’ve been building a WooCommerce specialist agency called Raison. At our peak we were four people.
We were never large company, but we were laser focused and very well versed in what we do.
Building an agency is hard work. It’s constant work. The better you do, the more people you need. The more people you need, the more work you need.
I was the core developer at Raison. Moving to a business operations role is tricky. Namely, because you have to delegate while at the same time ensuring quality control.
Raising rates help, but that hamster wheel needs to keep turning. Bringing on the top talent helps too, but costs go up accordingly.
Getting the balance in this feedback loop is the key to a successful agency.
I’ve been fortunate as the director of Raison to talk to many other agency directors. So what are their main turning points? The moment they reach critical mass.
Most will say it is growing from a 2 or 3 person operation into a 5+. Well, we made it to 4, so I’m not sure where we stand in this example.
I think this initial period presents a unique challenge. In the same way your first million is the hardest.
Scaling at the start is hard for a number of reasons. Key reason (in my humble opinion) is spreading your resource to cover growing and training your internal resource (people) whilst at the same time growing your sales.
Most agency owners I know have pushed through this by working insane hours. It’s massively un-scalable at this stage and you have to put the hours in. I know I did. I know others have.
Bringing on an additional person does not equate to an additional 8 hours per day of work.
There are new challenges. The successful agencies manage to adapt and overcome these.
However, it’s important to note that you are still in the ‘hour-selling business’. Scaling development is hard. Successful agencies accommodate this by emphasising their value proposition and bolting on maintenance packages. Their core proposition, however, remains un-scalable.
At the start of the year we re-structured Raison with this in mind. We kept our key agency staff on as contractors and reduced our development capacity. We down-sized.
If I were in Silicon Valley rather than Silicon Beach I would say we pivoted.
This surprised some as we were in period of growth. We were doing well, better than ever. We’d built up a financial buffer which gave us a window of opportunity to develop a few startup ideas that could scale. So I changed strategy. We down-sized.
It’s a riskier strategy. Building a scalable product takes time and is considerably different from a concrete project with a start date, an end date and fixed price. There is no guarantee of success. Nobody is going to pay you an upfront deposit for giving it a go.
I’m now enrolled at Brighton based Startup Accelerator called Entrepreneurial Spark. I think these are both fantastic opportunities and I’m excited at how they are going.
‘We’ has become ‘I’, and I’ve not given up client work. But with a leaner company I can now balance my time between the startups and development/consultancy work.
I never for a moment forgot that the hamster wheel would stop turning just because we pivoted away from Agency work. Bills still need to be paid.
I’m not sure how the story ends. It was an incredibly hard decision to downsize the agency after years of hard slog. It is my baby still! I am fortunate that the agency work enabled me to give another way a shot.
One thing I have learnt is the agency and the startups are both hard work!