Have you ever wondered what goes on behind the scenes of a seven-figure agency? The staff and team pulling the levers and the organizational structure and strategies driving growth?
I know when I first started out as a freelancer back in 2013, there was virtually nothing online about the topic. I had to figure everything out for my own and this meant I made some pretty epic and expensive blunders along the way. Was I meant to hire before cash flow could sustain it or wait till I had enough clients and then hire quickly? How did the big boys land the million-dollar contracts and what sort of margins should I be working towards?
With the boom of the internet and pure online markets, it’s been a gold rush for agencies and now the opposite can be said – there is almost too much information online about how to grow this type of business that it can be overwhelming. Not surprisingly, most of this information comes from “gurus” who have never actually built or managed agencies themselves – leading many down a costly road of misguided advice.
So for the curious who care to know what the set up of a seven-figure agency looks like, I wanted to take a moment to share some insights that I wished I had gleamed during the formative years of my business in the hopes to help give you clarity on how to structure and grow the machine that is your business.
Some important distinctions:
- You don’t need investors or large startup capital to make this work (although disclaimer, growing business will always require an investment of either time or money, the benefit of a service-based business is that you only really need $5K-$10K to get yourself going as long as you’re willing to reinvest profits back into your business)
- You don’t need inside connections or a huge audience
- Your agency is a gateway to other ventures. For example, if you start working with eCommerce clients it will probably make sense for you to invest in your own ecom shop and use your own strengths and internal resources to grow another income stream for yourself.
Here’s what I’ cover in the below:
- The organisational structure of our agency and the team behind it…
- Core viable final products, and how these are costed…
- How leads and referrals are generated and tips to keeping clients on for longer…
At the core – growing to seven figures isn’t very complicated, it actually boils down to three key parts. The beauty in this “keep it simple” system is that you don’t need to incur massive staff overheads, you won’t be required to micro-manage every aspect of your business and you will be able to position yourself in a way where you never have to get into process wars with other agencies again.
Overview of Eight Loop
Ok so before I dig into the juicy stuff, a quick intro of Eight Loop (my agency). I founded the agency in 2014 and initially, I was offering all kinds of services – from social media content through blogging and email marketing and Facebook ads. This lead to burnout and I quickly realized this wasn’t going to work so I refined our core offer towards Facebook ads. Through the years we have changed our niche from coaches to ecom and now specialize in building out marketing systems for other agencies.
Another big mistake I made at the beginning was to fall pry to the desire of having a big team and office for the sake of having a big team and office – call i9t ego and pride. I quickly realized this was going to make me bankrupt and – in light of the pandemic and current economic conditions – many agencies have come to appreciate that running a small and lean ship is far less stressful than having massive overheads. This, of course, is only possible if you refine your service offer and positioning.
Our Team & Structure
We currently turn around $130K/mth in revenue and work with about 20 clients max at any one time.
Surprisingly, we only have THREE core offers in the agency: a done for you funnel and lead generation ad campaign management. We offer additional bolt on services such as promotional video creations and email nurture sequences but these only represent a small fraction of our revenues and some of this is outsourced externally. We also work with brands (usually lead generation or awareness campaigns) but this is only 5% of our client base.
Although we are based in NZ – local clients only represent 2-3% of our client base. Most of our clientele is overseas and the average lifetime value of a client is about $9,000. International clients and deals from even the most remote place on earth. So the thought of – “my town or city is too small” is no longer a viable excuse.
We have five key team members behind the agency: an account manager, a business developer (sales), funnel builder, media buyer, and copywriter. As we grow of if sales are up we have trained account managers and copywriters we bring on to support as required on a client per client basis. This keeps our overheads low.
How to Avoid Micro-Management
This is something that took me a very long time to crack! I am a perfectionist at heart and couldn’t figure out how to hand over the production of services without getting anxious over quality or needing to come in and fix everything (doubling up my workload!). It all came down to processes.
I used to hate processes and systems – “I’m a creative, the strategies I come up with are intuitive and can’t be taught” is maybe a line you’ve used yourself.
This type of thought pattern is the fastest way to burnout and bankruptcy. You will never be able to scale your revenues if you are keeping yourself as the main person behind the production side of your service offer. Think about it – there’s only one of you, how many clients can you realistically look after before you start to lose the plot.
The good news – processes are VERY easy to build once you refine your core offer and positioning. And when you have solid processes in place, the scale can be achieved very rapidly without it doubling down your own workload and stress on your plate.
The Final Piece
Finally, the most important part of any business is arguably it’s the ability to generate new business. Your leads and clients are the life-blood of your business and if you’re like most agencies out there you’re likely completely dependant on referrals or word of mouth and this is essentially stunting your ability to grow at the rate that you would like to.
After running lead generation campaigns for clients in the agency I began to realize that I too could automate my marketing. Instead of having to attend conference after conference or have to cold call or harass people on LinkedIn I figured out a way to drive interested prospects straight into my calendar using paid ads to drive interest into an online funnel.
These would be highly qualified and vetted leads in the market for the services we offered.
What I never expected was just how quickly and effective this strategy would be for growth. Within two months of automating the agency’s lead generation we had scaled from $10K revenues to $100K/mths.
To this day, this continues to be our main and most reliable source of lead generation for the agency.
Now, cracking one of these funnels isn’t as easy as it sounds – and maybe you yourself have experienced the frustration of spending thousands with little to nothing to show for it.
The key comes down to your positioning and messaging as well as the UX of your funnel and quality of the traffic you’re buying. If any one of these parts is off the whole thing is broken.
Another big issue we encounter when agencies try to run their own funnels and fail is that they are often too close to the source. When it’s your client ads and campaigns you crush it, and yet, when it’s your own it’s like nothing works. This is really common and is the same phenomenon of a writer trying to edit their own copy – they are too close to see the spelling mistakes and their brain fills in the gaps.
RECAP
Ok, so as a recap, here are the three essential parts of a seven-figure agency:
- Having the right team and organizational structure
- Positioning yourself around a core offer(s) and building processes around these
- Having a reliable and consistent way to generate leads
With these three things in place, growing to seven figures no longer becomes rocket science or luck of the draw and you’ll be able to:
- Increase your profit margins, reduce your workload, AND pay yourself more…
- Retain clients for longer and generate more testimonials and happy customers…
- No longer need to rely on word of mouth and be able to put a plan in place for growth…
If you’ve made it this far hopefully its because all of this is making sense to you and resonates. Likewise, it’s probably because you yourself are hungry to grow your business and ready to start implementing systems that are actually proven and tested by agencies.
Over the years, my team and I have helped over 700 agencies and freelancers implement the exact same system above by:
- Refining your core offer(s) and pricing these correctly
- Building processes to guarantee quality for each and every client (without you needing to micro-manage everything)
- Nailing your messaging and positioning
- Closing your leads and sales calls scripts & processes
- Your lead generation pipeline and automating your marketing with paid ads and funnels
All of this for less than the cost of building your own agency website!
So instead of trying to continue to trial and error everything on your own, spending thousands of recruiting the wrong staff or team members and tanking thousands on lead generation efforts get a structure and marketing system in place for your growth to take you into the future!
To find out more about the system and if it’s a good fit request your free discovery call today: https://agencyfunnels.eightloopsocial.com/form-application
Cat