The dreams we have when we start our own business (and how to ensure they don’t turn into nightmares!)
Our hopes and dreams
Many of us start our own agency because we dreamt about creating something tangible and of value and something worthwhile.
We hoped that we might be able to impact the world in some small way and often believed that we could do things better than other businesses.
But if we are not careful our dream can turn into a nightmare. We can easily lose control because everyone is demanding our time, we are spinning 100 plates and lurching from one urgent crisis to the next. We have cash flow issues, client issues, staffing issues and so on.
This is not why we started our own business!
Why we start our own agency
But let’s backtrack a little and spend a few moments considering why we started our own business. We were probably fed up in a 9-to-5 job, tired of bureaucracy and politics, and the lack of control.
Often there is no direct correlation between how hard we work and the rewards and recognition we receive.
All of these adds up to a desire to start our own business.
Now there are three reasons fundamentally why anyone starts their own business. Firstly, they want to be in control (most likely because they didn’t have control in their past job) and secondly they want to have more flexibility and ultimately more freedom.
However, as time goes on the need for control is diametrically opposed to the ability to have more flexibility and freedom. As we grow, we move further from the reasons why we started our own business and we find ourselves working for a much harder taskmaster boss than ever (i.e. YOU)!!
But it doesn’t have to be this way, so please read on…
I’m writing this blog from a position of personal experience & I believe in sharing an honest “warts & all” story of my time starting, growing & selling my agency.
In my early 20s, I'd been working as a marketing manager for a small software company and we had struggled to find a good PR agency that understood the tech that we sold so in my naïve innocent optimistic youthfulness I decided that there was a gap in the market that I was going to fill by starting a tech-focused PR agency. We were going to help take complex software & hardware solutions & create compelling marketing messages to their audience & thus CIT PR (Communicating IT) was born.
In year one it was just me working as a freelancer, but I already knew that I wanted to grow beyond that so after one year my business partner joined and shortly after that the first member of staff was employed.
Now we never sat down and consciously created a plan that would identify the forward momentum and direction we wanted to take. Instead, we let external factors and opportunities dictate the direction of travel. Sometimes this was fine, and we followed the opportunities, but more often than not it caused problems for us because we weren’t always clear at what point we should hire the next member of staff or whether we should take on a client or not. It led to capacity issues and feast and famine in the agency.
Fast forward 11 years and suddenly we had 25 staff which meant 25 mouths to feed before we got fed, big demanding clients and a whole lot of stress! I woke up one day and thought this is not why I started my own business how did I get to this point!
At this juncture, we were feeling tired and worn out and started fantasising about following new pastures and getting out of the agency business. This funnel vision thinking led us to put the business up for sale and after 18 months we found a buyer.
Now it’s worth considering what a service-based business such as an agency is worth because much of what you do is intangible i.e. you’re not making widgets. So, any valuation will be based on such things as the client roster, the staff, revenue and scalability and to some extent, brand equity.
The key message I want to make at this point is that when I wanted to be less tied to the day-to-day running of my agency the only option I felt I had was to sell but now I know better: there are many other options and what I should’ve focused on is the same thing as many agency owners today desire and that is to build an agency that is less dependent on you which means creating running agency a self-running agency.
The minefields to avoid
If any of my story rings true for you then no matter what point you are on your journey there are several common mistakes owners make that mean they become more tied to their agency over time rather than less, so let’s just talk about some of those mistakes and it all starts with mindset.
If you can develop the mindset early on that you want to empower your team and you believe that they can do the work as well or better than you, then you’re more likely to delegate and avoid becoming the bottleneck for your agency’s growth.
Develop the right mindset and behaviours in yourself to create the space for your team to step into. Remove some of those false stories we tell ourselves ('the client will leave if they don't get me on their account', or 'they won't do it as well as me') and you are more likely to build a business that is less dependent on you!
So now you have the right mindset in place we now need to make sure that we are excellent delegators but trust me, most of us are not!
We know what we want someone to do in our heads and then we get frustrated when they don’t do it because we haven’t clearly articulated what we want them to do, what the outcome is, what support they need and a specific deadline to deliver that piece of work.
Bottleneck to growth
For all the amazing reasons why you started and grew your agency, some of those same reasons (i.e. the need to constantly be in control) can create a bottleneck and stop your agency from growing, so you must build a robust team, let go and “get out of your way”.
Referring back to mindset for a moment if you don’t have the correct mindset around pricing and you don’t believe that the value you’re delivering for your clients is worth the fee then you will always struggle to charge a fair price and increase your prices regularly. This is perhaps the main reason why agencies don’t increase their fees or why they don’t get their pricing strategy right in the first place (this is a value/outcome v time/inputs conversation).
At the end of the day, it’s relevant whether you think your price is high or low because it should be based on what your market and what your customer is willing to pay and the perceived value they receive from your service.
So, these are four core barriers that get in our way, that stop our agency growing and that keep us tied to the business. Of course, there are many others, but these are four key ones that you can immediately acknowledge and start doing something to remove them.
The ultimate goal
When we started our agency the ultimate goal that many of us dreamt of was having flexibility and freedom whilst still maintaining some element of control in our agency. This means that we’ve got a constant stream of income yet also have the time to pursue other interests if we so wish.
Ultimately, we all wanted to build a self-running agency.
I know this since it’s what I aspired (yet failed) to achieve and I know it from working with over 200 agency owners. This is ultimately what they would love to build yet often don’t believe it’s achievable because they don’t put some of the aforementioned steps in place…. but you can.
I have gone into a ton more detail in my brand-new book which is part autobiography and part step-by-step guide. The book normally sells for £5.99 but right now you can grab a copy for free.