Thoughts
October 25, 2021

Some advice for 22 year old me (or you) starting an agency

When we sold our marketing agency this year, I spent some time digging through old files and found some photos from those first, fresh-faced days starting out a decade ago. The kid staring back at me was taking those unknown, early steps on an exciting journey that took us from the corner ice cream shop to the Super Bowl — it was awesome in the truest sense of the word.

With the clarity of standing on the other end of my path with Digital Natives, there are some things that given the chance I would tell that guy. And while that’s not possible (if so, Ben in 2011: buy a lot of Bitcoin), I’m certainly able to tell share them with you today, who might just be considering taking the entrepreneurial leap yourself. There’s a lot to say, but let’s start here:

Your agency is your client too

Build a brand you can be proud of. There’s the old saying “the painter’s house is never painted,” that often applies to creative and digital shops — you can be so heads down in the business of creating great work for your clients that you never get around to building a website, social presence, or whatever for yourself. It can be hard and annoying to turn your focus inward, but you need to set aside the time and push through this if you want to truly build your agency.

Whatever your core values are, bring them to life. If you care about social justice, do pro bono work and have team volunteer activities. If you care about education and empowerment, host school groups and teach your craft. If you care about art and creativity, then host a gallery in your lobby and sponsor a photography competition. People want to do business with companies that care about something.

We might be living in a post-office world for a while longer, but I’m a believer that your space can build your culture. You should create a space where your team can do great work, of course. But you should also make your office or studio a way to define who you are both internally and externally. Put up awards, hang inspiring art, add some wowing tech flourishes, invest in tasteful and high quality furnishings, and bring your brand to life in the most tangible way possible.

A good contract is everybody’s best friend

If you are venturing into client services for the first time, you may be thinking that you can get away with starting projects on a handshake and a Venmo request. You’d be wrong. Do yourself a favor and start with a solid contract template from day one. You can find a decent base of what you need for free with a quick Google search, but the few hundred bucks you’ll spend on getting a lawyer to review it will be one of your smartest early investments. To be clear, I am certainly not a lawyer and nothing here is legal advice.

In that contract, there are a lot of things that you’ll want to include. One feature that goes a little against most people’s first instinct is to set your payment milestones as triggered by your action, not your client’s action. This means you bill when something is presented or delivered, not when something is approved or launches. There are a million reasons why a project might stall out and never launch — and frankly most of them aren’t your problem. You do work, you get paid. That should be non-negotiable.

Speaking of a project ending early, that generally sucks, but it happens. Maybe your client had an internal reorganization, or maybe you guys just didn’t see eye to eye once you got into the process. Either way, you’ve set aside time and resources to complete the project, and canceling it will leave you in the lurch. Make sure you outline who can terminate your contract and how, and then include a reasonable “kill fee” for any work discretionally terminated early by the client. On the same note, include language and fees that outline what happens with projects being extraordinarily delayed by the client. This keeps you whole, and makes sure that clients are respecting your work.

Make sure you are insured from day one, or as close to it as possible. Especially when you are just starting out it won’t be terribly expensive, and clients will take you more seriously if you mention it in the boilerplate of your proposal. In your contracts, there are a number of things you can and should do to indemnify yourself, and a lawyer will be able to clarify what exactly might be helpful. One piece that we always found helpful: include a clause that limits your total liability to the cost of service.

Without clients, your agency is just a hobby

Some people just love business development, and some people would rather have their fingernails ripped out than make a cold call. Unfortunately, the overlap between great creators and great salespeople is a pretty slim Venn diagram, so the odds are good that pitches and proposals might not come naturally to you. Too bad. You need clients to have an agency, and you simply need to get over any hesitation you may have. Ultimately, this is business, not art.

But, you don’t have to be Willy Loman to be good at new business. The best agencies aren’t necessarily dialing up every business in the phone book, they are crafting a reputation that attracts clients to them. The hard part when you are starting out though is that business development is a flywheel: the longer you are in business, the more clients you have worked with, the more people know you, and the more new opportunities land in your inbox. It spins faster and easier as you go. At the beginning though, you need to really put your back into pushing that flywheel to get it spinning. In fact, new business is one of the few things that is much harder in the small, early days than when things grow bigger and more complex.

The best ROI will be the time you spend meeting new people. The problem is that most “networking” events are trash, full of people shoving their business cards in your face and resulting in no real, relevant connections. I’ve always found that the best relationships are those built through other activities, such as serving on the board of a non-profit, joining an alumni group, playing in a rec league, or volunteering for worthy causes. It’s also vital that you view the people you meet first as friends, real humans, and not just a potential source of referrals. Investing in relationships pay off over time in more ways than one.

You’re going to win about 25% of the stuff that comes in. If you’re hot, maybe that becomes 35%. If you’re cold, then 15%. You have to think of new business like a baseball batting average: if you get a hit 3 out of 10 at-bats you’re a hall of fame performer. There are plenty of ways to improve your chances of winning a pitch, but even if you totally nail it, you still have to be prepared for a lot of rejection.

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There’s more to be said, and a lot of this isn’t rocket science, but I sure wish somebody told me all of this when we were first starting out. The last thing: do it.

Starting a business is easier now than at any point in history. With a hundred bucks and a laptop, you can have your website up and business cards in the mail by the end of a long afternoon at Starbucks. Starting a service business today requires no factory or warehouse or even an office. I’m excited to see what you do.

About the Author

Ben Guttmann ran a marketing agency for a long time, now he teaches digital marketing at Baruch College, has a book coming out in 2023, and works with some cool folks on other projects in-between all of that. He writes about writes about how we experience a world shaped by technology and humanity – and how we can build a better one.

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