Quality Suffers When Owners Step Away | Episode 217

Speaker A: Homeboy took a month and a half off of his agency to enjoy time with family. And also the World Cup. They're, uh, actually down about $10,000. Mrr. Everything happens within a month and a half. That's kind of crazy. Is your team that bad? What happened here? This was a buildup in which he failed to see the warning signs. So I have the receipts. The problem is the quality suffers more the smaller you are. Owners can't step out of sales until 5 million and up. There are no shortcuts. You don't get a pass to work less just because you're the business owner. That's not for you. Then you're not cut out for this. Everyone in this world needs to work just as hard as the janitor. That's life. Suck it up. Been super lethargic today. Uh, I was going to go take like a nap, and I can't remember who suggested it. Oh, maybe it was me. I was like, I'm. Maybe I need to go run or something. And then you, uh, suggested I do it and maybe I'll feel better. You're like, you won't feel worse. I'm like, well, it is running for 30 minutes, so maybe there's a good chance I could feel worse. Uh, and then I did it and I asked, you didn't feel worse. And now I feel like I took a nap. Like, I feel like I don't feel as lethargic anymore. I feel like, uh, I'm not as drained. So. Yeah, yeah, it's a life hack. It's like, oh, I need to go lie down. It's like, no, I just go to the gym. Crazy.

Speaker B: Yeah. Sometimes it's a toss up. You don't know. Right. But I mean, if you knew that you slept well, then you probably just gotta work out.

Speaker A: I feel like I've been sleeping well. Like, a lot. Maybe. Maybe I'm not sleeping well and maybe that's why I'm sleeping a lot, because I struggle to wake up.

Speaker B: I'm on steroids right now, so I'm

Speaker A: not sleeping like Trent. Are you getting yoked?

Speaker B: No. I say I wish. I don't wish. Uh, but I was. I am. I'm recovering sick. I got a steroid to get better and it's working. And the only downsides are more anxiety and less sleeping. And I don't care because I've been sick for two weeks. So I accept whatever comes with it.

Speaker A: Nice.

Speaker B: Well, I'm glad you I'm not as stronger. Yeah, it's the same.

Speaker A: Not that kind of steroid. Uh, I got an article that I found really interesting over the past week, uh, here. So it was actually in Stacked Marketer and I think it was like just a little over a week ago that it was in there, but it was an article about AI flagged content in social media. I think this was specifically TikTok, but I think it kind of covers everything. But basically like the headline of it is, AI disclosed content pulled in 78% 7 to 8% fewer likes and 7% lower combined engagement. So like, it doesn't sound like a lot at first. You're just like, okay, well that's like not, you know, obviously like the quality of AI content isn't that great, but this is actually like a peer reviewed study that the, um, what is it the Journal of Consumer Research published?

Speaker B: It looked official. I was looking at what you had put in there and I thought, yeah, this is college. This is college stuff.

Speaker A: I read it and I was like, I feel like not just reading it, I had to throw it into Gemini and be like, can you explain this to me? Like, I'm five. So basically. So this is from the abstract. The abstract says reduced parasocial connection is driven in part by the perceived effort of the content creator, as such disclosures that signal greater effort can mitigate reductions in engagement. So I was like, okay, I don't know what you're trying to say there. Like, like, what does this mean? Like why is this the reduction? Or why is, why is this uh, um, receiving like lower, uh, engagement? And basically the translation is when people see the AI tag like up in the corner, like this is produced with AI, they assume there's a shortcut or less effort in producing that content. So because they think the creator didn't work as hard, they lose any sort of like personal connection to them and then they're less likely to like, comment or share. Um, but there's a but here. If the brand creator explains the level of effort needed to create the content, despite the tag, the audience is much more likely to engage and stick around. So basically like, like, hey, I created with this, with AI, this is like the entire prompt that I had and it was like super long. Or like they explained the entire long drawn out process. Um, people are okay with that, that you don't, you don't see the drop in engagement. So essentially people just like want to know that you're putting an effort and that's really all it is. So I was looking into the article a bit because like there was, this, was, this study was shared by science says dot com. And it was like a super brief overview and that's what got shared in Stacked Marketer. So I'm like, okay, like where's this actual study at? And that's why I'm like looking at the actual study stuff. And what science says was, um, the AB test they ran, or I guess it wasn't a B test, it was a control versus the actual test. They're like the quality of the post with the AI tag and without the AI tag were the same. And I'm like, well if that's quality is subjective, you can't just tell me like, oh, it's the same. Trust me, bro. So like I had to go like into the actual uh, research and I'm like, I want to see the actual examples of here.

Speaker B: Did they share it in there?

Speaker A: Yeah, they did. Yeah. And so the actual examples they all they did was they did the exact. It wasn't an AI video. It was the exact same video with the AI tag and without the AI tag. The exact same post basically.

Speaker B: Was the video actually AI or did they.

Speaker A: Okay, it wasn't. It wasn't. Yeah. So, um, and like I think TikTok and YouTube. YouTube for sure. I know this for sure. But YouTube has like was AI used in the creation of this? Basically and you have to flag that. But that's where I found like the 7 to 8% fewer likes and engagement was, was important because it wasn't just like a quality difference, it was literally just a label reduce that. So I get that. Yeah, that's what I found interesting.

Speaker B: The disclaimer too, this idea that if you give people a heads up about the way in which you used AI before you go to then use it, that people are more receptive to that idea. It seems a really easy way to handle that. Right? You say, hey, we used AI while doing this. This is the way that it made it better. And this is all the efforts that like it comparatively depends on what you're cranking out. But if you're doing substantial YouTube videos or something like that, then seems like a very easy way to preemptively address that.

Speaker A: Well, I wonder, I wonder like how it would work if you were like, like if you didn't have the production to make like a really nice ad. So you just ran it through like AI Because I've been seeing uh, like a lot of AI product related ads lately and I'm like, it wouldn't be that hard to go out and shoot that. But like if you're, if your post on top of it said, hey, enjoy our AI created ad that we don't have the skills to actually shoot. Like, I wonder if, like, they actually said that, like, kind of tongue in cheek, uh, if it would improve. But who knows? All I know is, like, the less effort you put into it, people have a lower perceived quality of that.

Speaker B: Do you feel that? Do you feel that way when you're consuming other people's stuff? Like, if you see AI, yeah, for sure. Ick. Okay.

Speaker A: Yeah, absolutely. And I don't know if it's like. Yeah, I mean, yeah, I would definitely say that. Uh, and it's one of the reasons why I don't like to use AI in any of my writing. Um, there's like, every now and then I'll have AI help me create a transition sentence or a transition paragraph, but then I'll completely rewrite it. I'll be like, thank you for the idea, but you're also terrible at this. But, uh, speaking of quality suffering, um, and, uh, a perceived lack of effort, we wanted to talk about the quality of agency deliverables when owners step away and give less of it. So, uh, this is actually a topic that came to us as we were perusing Reddit and as our friend. We love and adore Caesar, who's been on this podcast.

Speaker B: Unofficial co host.

Speaker A: Yeah, he's been on this podcast like, three times. So he posted in Reddit and on LinkedIn and probably every other social media platform out there. A post, and the title of it, at least in Reddit and R agency, was down $10,000 MRR this summer. It's on me. And it's not really a long post, but it's kind of a long post for me to just read everything. So I'm going to read everything that I think is relevant for this episode. And if you want to go check it out, uh, the link to the post is in the description of this episode. But I'll start right in the middle here. It says, I was looking at our revenue and we were actually down about $10,000 mrr. Between June and July. We had a 5k client that had to cancel, as well as a few others, uh, that paused. Canceled. This is where I think leadership matters the most. Do I panic and freak out? Do I blame the team? Do I do nothing? Do I observe the game and say, this is normal ebb and flow of the business? Slow month made seemingly worse from a couple of cancellations. So at first we're just looking at this post saying, like, okay, some people canceled all at once. And maybe that's just a circumstantial thing. Um, then he goes on and you start to wonder. I think this is where the it's on me came from in the title, he says. Not to mention, this is somewhat my own fault. I took the majority of June and half of July off to enjoy time with my family and also the World Cup. So homeboy took a month and a half off of his agency. Uh, now that I'm back in the driver's seat, leads are up and we've closed a couple of new clients, which is another sign telling me that even though I'm not in the day to day operations with our existing marketing clients, I'm very much super involved in client acquisition. And it showed with my minimal activity in creating content and engaging with potential customers. All right, and a couple more sentences here. Now that I've started pulling my own weight on what I provide to the business, lead flow is back up. We are still producing quality work and the slowdown is more than likely just a dip. But if we keep doing what we are doing, it will work out. Kind of like losing weight. I suppose it's unreasonable to be perfect, to have perfect days. Uh, yeah, every day. But when you have a bad eating day or a week or a month, the best thing you can do is go back to the things that were working, trusting the team, continuing to market, continuing to provide quality work. So at first this is like, oh, hey, we lost like 10k. Mrr. Um, and one of them was like a 5k client, I think. But his average ticket price, I think is like, uh, 1300 bucks. So he lost like a lot of clients in a month and a half with no new acquisition, essentially. And I remember back when he was on our podcast, I think the last time he was talking about how he changed his model by being more of a boutique agency because he. It was like every single month it was losing. I think these are just random numbers here, but losing 20 clients and gaining 24, you know, in a month.

Speaker B: So he was saying if you do. I don't know if he's saying exactly 10k or 10 within the realm of 10k. But if half of that is a 5k client, the rest is about 1,000 per six accounts. Six accounts in, in a month and a half? Yeah, yeah, that's.

Speaker A: That's a lot.

Speaker B: That's indicative.

Speaker A: Yeah, yeah. So like in the, in the frame of this post, you're like, oh, you know, it's. Everything happens within like a month and a half. That's kind of crazy. Like, like, is your team that bad they can't keep on six clients? Or did you on like, what happened here? Did you on, uh, like, are all these clients? Was it a qualification process that they just left? I don't understand. But, um, there was a comment by uh, this guy named Louis Volkoff and I really enjoyed it. I think it was a good comment. So I had nothing else to add to it, just based off of this context. But, uh, Louis said you took June and half of July off of an acquisition and the leads dipped and stepping back and fixed that. But the cancellations come from the part you handed off, not the part you returned to. That's the signal I'd sit with, not the MRR number itself. Delivery and retention are your teams now. And one big cancel, plus a couple of pauses is either normal churn or an early crack There with worth a quiet look at why those specific accounts left before you file it under quote, ebb and flow. It's like, yeah, 100%. And I think, I think Cesar has this kind of mentality where he is like, ah, it was just like a month and a half, like maybe this is an ebb and flow. And I'm like, I don't. You've never posted about this before. This is the first ebb of this magnitude. So I would probably consider why this is happening.

Speaker B: I thought that was a very grown up response, that comment and that idea of how to approach it that way. I do think there's stuff that we know about Caesar just contextually, um, from other things that aren't in this thread, that if all you saw was this thread, the comments do make a lot of sense because that's all the context that you know. And with all those comments, when you look at it that one way, I agree with a lot of them. Like I think they're, they're very good. There's one of them that talks about the uh, what they call it a blame free postmortem. So this idea that you come back, you get the team together and you say, hey, I'm not blaming anybody. I'm saying here's what happened and we as a team come together and address and try to fix this so that moving forward it doesn't happen again sort of thing, it's a very good and healthy way to approach this sort of thing happening. I guess I should say too, when I was saying six accounts, like six accounts, because we know Caesar and the size at which he operates generally, that that could be indicative. It probably is. Um, but if you were a much bigger agency. Six accounts might not be anything. So that's yet again, more context of we know things that aren't all introduced in this thread. So then all the topics and the discussions and the responses are just based off that information that is known. I thought a lot of it was good, this idea that approaching it that way. Um, also just going back, it's really talking to the team. Go talk to the team, see what's up. See what happened.

Speaker A: Uh, Cesar, privately DMs me about some of the stuff that he has, like, questions that he has about certain things. And he's notorious for, like, asking for advice than not taking it. And that's his own words, too. Like, even on this podcast, he says that he doesn't like taking advice. He likes to figure things out on his own, which I think is really, like, it's very indicative of how I operate too. Like, I don't particularly like advice, but I also don't ask it very often. Um, when I do, I take it to heart. Um, I like people.

Speaker B: I'm bad at it. For what it's worth, I think I've told you that too, right? I'm like, hey, I'm. I'm bad at this. I know I need it, so I want you to give it to me. And then I'm going to go away while I process it because I'm like, I'm not going to like what you say, but I'm asking because I do value your opinion and I know that you're probably right and I need your input. So let me. Let me take it. I'll go sit with it. I'll come back once I've had time to process and be like, okay, I could drop my ego and say that you're right and you have really solid points and go from there.

Speaker A: Getting advice from you is difficult because, like, it's like, you, like, it's weird because you're like, uh. Because you'll ask me like, hey, are you. Are you looking for advice or anything? And then if I say yes, I'm like, okay, here it comes. Because it's like. Like, I don't know how your brain operates, but you've been, like, formulating this whole thing in the background this entire time. And you're like, okay. So you say this, but really your behavior shows this. And I'm like, okay, this hurts a little bit. I'm gonna sit with this. How long have you been thinking about this? I was like, this.

Speaker B: I don't think that long. I think it probably just comes a little intuitively.

Speaker A: Yeah, that's what I'm thinking. It just comes naturally. Um, but I have private DMs with Cesar and I'm not going to share things that we talk about privately, but I will share things I've said to him privately, um, that uh, are open on the Internet. And so a couple things, I um, mentioned this to him in private DMs, but this information you can find anywhere on our previous episodes as well. But, um, he mentioned price increases and slower signups, which is kind of what the goal was he was trying to do. Initially he had a sub $500 price for his entry level marketing. And then he increased prices at least two times within one year, only on new clients. So he still had this two tiered agency where he grandfathered in a bunch of people. And then in this newer price tier he had, he was still delivering the same amount of work, but we're just paying more. Um, and uh, the problem with that, like I think he's charging like close to 1400 bucks a month now, which is like uh, his lowest tier. Um, he increased pricing. Uh, so the increased pricing usually comes with increased expectations. I'll start with that. So like if his for sure, if his old clients were paying him at, we'll just say $300 a month to do, I don't know, basic Google Ads or what. Um, and he was giving this value to them and then take that value away and was like, hey, this is like too much. Like maybe those clients were like, yeah, ah, you know, that makes sense. I'm still getting the value for $300 a month. But then you increase the price to $1,400. Maybe you add in more value. Maybe it's not just Google Ads. Maybe it's also SEO. Maybe you even add in meta ads to it too. That still comes with an increased, uh, expectation. And not that, not just like ROI or leads or anything like that, but communication, um, like deliverables reporting. Like if you increase the price to a certain threshold, the expectation is going to increase. And if you're delivering the same value you were at $300, but you think your value is just inherently worth more. Now that's great, but the market doesn't see that. So here's the problem. Caesar communicates to his clients just as much as we do. And we are half the price of him in our management fee. You add in the minimum ad spend commitment and, and he's four times our price. He's four times our price doing the same amount of communication. Yeah. People are going to leave.

Speaker B: Just purely price comparison, price shopping, price for value sort of thing.

Speaker A: Yeah, I mean, not necessarily that, but like, I think, I think communication in our agency is pretty bad too. Like we need to beef up our communication and we're again, our management fee is half the price. And so like, if people are already complaining to us about our communication, I can only imagine what it's like in, in Cedar's Agency. And this is, this is all just me, like kind of externally.

Speaker B: So here's, here's, um, this is the prime example of. I've thought about this. Not extensively, but I have thought about it and this is something that I've spent considerable time thinking about and just haven't really said out loud before.

Speaker A: Right.

Speaker B: So this isn't the critique or criticism, but it's a prime example where I go, yeah, for sure. We've talked before and we know our communication is not ideal and has a lot of room to improve and should be better. Um, we also know our churn is super low. So even if clients do complain and they say I'm not happy with your level of communication, but at the end of the day they know it's proportional to the price that they're paying, we can say, okay, it's not ideal, but it is acceptable at this point. We do need to improve it and make it better. But ideally for a situation or a product I service that they pay more and then we communicate more. Right. I mean, theoretically, I guess if you just scale it up, then they're still going to complain because they want still more communication. But we can deal with that.

Speaker A: Yeah, I think this is just, again, this is me subjectively on the outside looking in. But if I can say that, hey Cesar, you basically, um, not tripled, quadrupled, almost quintupled your minimum commitment and you didn't add additional value and deliverables. Yeah. And this is inevitable. You're going to have this high churn like Cody and I prevent adding additional service unless we're ready to act on that. Because like if we have, let's say our base package is uh, 650 bucks a month for SEO and Google Ads and then we have like an SEO add on that pushes people over $1,000 a month. Expectations totally change. We can't just do like more SEO work to get more results. We now have to deliver more reports and do more communication because that's what the market expects. That's where our clients expect us to deliver because they're now paying us over a Thousand dollars a month. So that's why keeping our base price under a thousand is very intentional. So, yeah, that's, that's all. Now. Um, I did want to say that, uh, I went through the last two years. I audited all of Caesar's posts, I audited, I went back on LinkedIn, back on Reddit, I even looked at the transcripts from the three episodes that he's been on. Cesar did not lose $10,000 in MRR in, uh, one and a half months. This was a 20 month buildup in which he failed to see the warning signs. So I have the receipts. Cesar posts amazing content online. I love to follow him on LinkedIn and Reddit. And he's been on the show, like I said, three times. But that leaves a paper trail and I can break down exactly where all of this went wrong. We'll go over a timeline in our tactical recap of this episode found on our new Patreon. That's right, we're selling out.

Speaker B: There we go. Time to get paid.

Speaker A: I mean, not really. Uh, we are working harder on these episodes. Like these episodes now are going to be much, much more planned out. Um, so the value that we're going to put in the Patreon is going to be a lot more hard hitting tactical stuff that you can actually apply and the stuff that in these episodes are going to be pretty much the same thing it's always been like in the free version of it, it's going to be very high level solutions. Some of it's just going to be things we're working on. And then in the Patreon it might show you the dashboard and the actual things you can actually physically see what we're working on. So in some of those we're going to jump into Google, meet and record that way, that way we can share our screen and you can actually see some of that stuff. So, um, head over, if you want to check this out, head over to the agencygrowthpodcast.com forward/premium to uh, sign up and get exclusive bonus content, including new actionable and tactical recaps of each podcast episode topic, as well as never before seen mini episodes where we engage and react to community questions and topics. So that was the thing that I thought would be fun too, which was we just go into like Reddit or Discord and we look at some questions that get posted and they're not really worth like a full hour long episode, but we can talk about it for 15 minutes and just kind of answer it versus just sitting on our keyboard and typing it in. So one second my cat's meowing, I gotta let him out.

Speaker B: Well, I can say I'm stoked.

Speaker A: We've spent, man. I shut the door, so don't get interrupted. And then I forget, my cat's in here. And he's like.

Speaker B: I was, I was like giving him the, the rundown of, of what I had to throw in about this too. And it was just. We spent a lot of time on this. We've been exploring, trying to come up with the way that suits us and makes sense to monetize this better. And yeah, we, we. What's the best way to describe this? We, up until this point, we have spent substantial time, but really not the tipping point of the time that you probably need in order to do a good job to offer premium content. And that's the barrier that we want to go across. Now.

Speaker A: That was our biggest concern. We've been doing this podcast for four and a half years now, almost four and a half years, and we've really never monetized it. We've had a couple sponsors here and there, but, I mean, we're still in the hole. I mean, we've bought camera equipment, three microphones, we bought two DaVinci Resolve studio licenses. We've, uh, got to pay our artists for all the mock ups. We got to do something. Plus, it's just taking all of our time, like it's taking, it's taking Angie's and Lisette's time to edit the videos from the agency, uh, these podcasts. And it's like we just need, we need a way to, like, you know, produce better content without sacrificing more of our time. And, uh, the thing we struggled with with, like, the additional community was making sure that we were going to be able to provide enough value in it for people to actually want to, to be a part of it. So, um, that's what we're shooting for. So if you're a big supporter of the podcast, go check it out. Uh, that'd be absolutely amazing. Um, but yeah, okay, let's go back to the episode. So I just want to reintroduce the overarching topic here. So, uh, all of this is a classic example of how an owner's involvement is directly related to the quality of the agency's output. So every agency and business really should expect a quality reduction when the owner or owners are less and less involved. The problem is the quality suffers more the smaller you are. So if you're doing under a million and you go step out the quality of your agency is probably gonna really reduce versus if you're doing 10 million and you step out. Probably less of a quality issue there. But, um, I have a couple of, I don't know, anecdotes, stories about kind of like, I have a general rule of thumb of when I think owners can generally start to step out of certain roles. Not totally right. They're always going to be involved. Um, I've said on this podcast multiple times that owners can't step out of sales until I think it was at least 2 million or above. Um, but I would actually say if it's sales related, probably 5 million and up. If it's account management, then I'd probably say 2 million and up. Now the reaction I get is always, well, you're not that big, so what do you know? And m. It's a fair point, but, um, Cody and I have worked for agencies our entire life. We've also interviewed tons of them on this podcast and we have their direct quotes and what they said. So like, we can either learn from that or we can get to that and just, and see how it goes.

Speaker B: So yeah, that's an important point. Like I, I get. And I want to say it out loud and recognize it too. I don't even feel comfortable a lot of the time. I don't want to be the, or seen as the subject matter expert for the thing that I haven't experienced myself. But that's not the goal here of some of these things that we talk about a lot of the time. It's us facilitating professional expertise that you might not have access to otherwise. Because how often, how frequently? If you're just starting an agency or you're smaller, are you talking to an agency owner who's at 4 million above? You're probably not. Right. Uh, if we're just being honest, that's. That's a pretty hard person to get access to a lot of the time. So we do have that access. We're just telling you what they said and we've talked to multiple ones of them and they've told us the same thing. So it's easy for us to just parrot that to you. It's not even us saying, it's like, hey, we're saying that they said this and they did experience it. So there you go.

Speaker A: Uh, yeah. And there's things that are sudden discovery calls and like post, post podcast recap that like we don't cover on this actual podcast. So when I say we've interviewed these agency owners, even if we haven't directly talked to them in the recording. Like we get to learn about them in the discovery call. Discovery calls. Like we've had discovery calls that went on for an hour and like it was, it could have basically been its own recording, but it wasn't right. We had to like schedule like two months out. So we forget everything we heard and then we could come back to it and say this is the first time we're hearing it.

Speaker B: That's always fun too.

Speaker A: It's always nerve wracking. Cause I'm like I forgot everything about them. Then I always remember them. Like that's good because then we can just, then we can just figure it out. Um, so, uh, I'm going to tell you guys a story about uh, when I worked at Leverage Lab. So if you guys have followed the podcast for a while, you know that I worked full time at another agency called Leverage Lab. And it was an. It is an agency specifically for media and publishing companies. Um, they basically productize, uh, digital marketing and audience, uh, management. I guess that's the easiest way to describe it. I can get real nerdy about CDPs and first party data, but that's like the simplest way to describe it. Um, long story short, they do marketing for publications, uh, and sales consulting. Uh, when I joined Leverage Lab, I think they were doing right around just under 4 million in revenue. And they were on. I think they hit the Inc 5000 list twice in a row. Uh, so the Inc's fastest growing companies two times in a row, um, doesn't mean a ton. It just means that they grew pretty fast. Um, but having said that, the owners at the time were Anne Marie and Matt. And Anne Marie is more of a salesperson. She was very much like me. Her and I had very similar personalities, especially when it came to sales. And Matt was very much like Cody, except Matt was kind of, um, he's kind of like a, what do you call it, like a, like a diet coder. Uh, he wasn't like a full on programmer or coding, but he knew his way around scripts and SQL and things like that. So um, he was very smart and he was an account manager for all intents and purposes. He, he actually managed a lot of the accounts that I ended up kind of assisting him on and then eventually taking over. And we'll talk more about mine and Matt's relationship and how that transitioned in the next podcast topic that we plan to talk about. Um, but uh, right around I think 3 million, Matt stepped back and they hired salespeople. So they had A they had a product that was like essentially groundbreaking as an agency. Um, it uh, required pretty advanced education not just to the client but also to like the general market. And what the product was, was it was essentially um, they were reselling a, a software called Lytics, which is a cdp. And uh, a CDP is a customer data platform. It's basically like one centralized area. You can, you can centralize all of your customer data. So if you like Mailchimp and HubSpot and web activity data and like all those other programs like your POS system and all this, it's like it just combines it into one and it creates individual person profiles. And um, that profile can be assigned to content they've read, emails they've opened like a long history of everything this one person has done, especially if you assign it to a web cookie that they've been tracked. So the easiest way to connect somebody like a profile to a web cookie was like if they were sent an email and then they clicked a link on that email, went to the site, they can now take their cookie basically and match it up to an actual name and email. And then now they have really advanced marketing targeting capabilities that they could resell to advertisers and sponsors saying like, hey, we can target these people who are subscribed to us, who have visited these pages and who are interested in these topics just based on their activity. That's a super groundbreaking thing. And they were way ahead of their time on this. And these were all first party data cookies. So like right when I joined there was like this whole movement about the death of the third party cookie. It's like the cookie apocalypse with Apple, like iOS 14 and stuff like that. Um, and people are like oh, like you guys are gonna be less relevant. It's like no, no, the things that are dying are third party cookies, not first party cookies, which is what this was. It was control over your own web data. And so um, I had to explain that to all of you guys right now there's probably a few of you who might understand what I'm talking about, but this wasn't an easy concept to explain and sell to new publishers who were kind of like newer to the space or to people who haven't really consolidated all our data. Um, and also the thing with the media industry, it's a very who you know type of industry. You can't just like cold dm, um, somebody in the publishing and like at a publishing company and just be like, hey, I'm going to sell you $100,000 software, like, it doesn't work like that. And the thing about Ann Marie is that she came from a large publishing company to start this. She implemented this thing at the company she worked at and was like, hey, I can do this, um, and sell it, and I can sell it to other publishing companies. So that's what she did. But she was already in the space, so was Matt. They started this company together. They knew who to talk to, they knew how to get in front of these publishing companies. And so it was a very hard thing for them to step away from sales. And like, they were at 3,4 million. They could be at 5 million now. I don't know how big they are now. But, um, Matt, he sold his equity. He was. He's no longer in the business. But Anne Marie is still very much every day involved in sales, very much every day involved in some of the account management aspects of it. When I was there, um, there was always a hand from one of the owners in account management. And that's just like one example of a smaller kind of startup agency that's like the. You. You can't just step away because as soon as you. As soon as one of them stepped away, their quality absolutely tanked.

Speaker B: Yeah. Yeah. And that, I mean, that was smaller than the example that I had. So it still even continues to happen even bigger. I was going to say, um, my example for this is Target Click, which is the. The agency that I was hired at that became Mud Advertising, where I met Jake. It's. It was weird because I got hired after the acquisition technically, and they were still going by Target Click, his name, but then it, it changed, uh, while I was there. And anyway, um, what I want to say is this starts to go into the other half, which is, um, about company size and leadership, which Jake is saying a lot about. And I'm trying to save a lot of, of my triggered opinions for you guys who have to pay for it, because that's the bulk of, um, really what I have to say here. So I'll just give you the, the, the story and the numbers so that you can have yet another example. Target Click grew rapidly, continued to grow even after it was acquired, as long as the owners were still there. So they had three different owners, and at that size, they had passed 30 people. Right. And they got absorbed into a bigger company, which was mud. And at that time, they had around, I think, 200 people. So this was a sizable operation. This is a subdivision, but effectively, at least for the time being, was independently run and managed. So some People would say, and there's truth to it. At that size, you can get out if you start structuring things correctly. Um, but what ended up happening was one of the owners left. That was Doug, I think a month later, Greg left. So that was two. And then there was a third one, Therese, and she stuck it out. But honestly, after both of them left, it was never the same. Um, the team shrunk. It did. It stabilized. Uh, and I think in hindsight, if you look at it as an acquisition, I think it was successful for both parties. I've talked to Greg a decent amount, and I think he'd say it was a success. You know, you get the paycheck, you stick around long enough for things to be handed over smoothly. And the, uh, acquiring party was successful in that they got the division that they wanted, which was digital, that they didn't have before, and that continued on. So that worked, and it was successful in that regard. But the growth ended once the leaders were gone. And it's that simple.

Speaker A: I think even looking at our own agency, like, when you and I step away, like, I mean, we're. We're approaching half a million. We're on pace to do it, but, um, half, uh, a million in profit. And, uh, anytime, like, we step away over, like, what we're directly oversteering, and we come back to it, there's always fires to put out. And, sure, that could be a testament to. Maybe our processes aren't as good or our team isn't as good. Our team's been with us for. Everyone's been here for three years or longer, which is huge. Um, the only person, I think Angie, maybe she's got, like, a month or two to be three years. I'm not sure we've got ears on

Speaker B: everybody at this point.

Speaker A: Yeah, um, Eva's been here for four years. She's going on five. And the team is stellar. Team is rock solid. Uh, our processes. I don't think I've ever seen an agency with more strict processes than we have. Um, we have a very productized service and very strict procedural documentation. And because we're a niche agency, so, uh, even looking at this and seeing other agencies, um, at different sizes where the owner is still involved, these are how I get my numbers. I haven't seen any agency where the owner has stepped out of sales after 4 million and out of account management after 2 million. Now, did they hand off some accounts? Probably. Uh, I mean, I just started handing off some accounts to Lisette and Angie, but not all of them. I think out of our. I think we have over 50 clients, 30, I think 34 of them are actively marketing. And I think Angie and Lisa have eight each. Um, but they're like the day to day contact. Even though those clients aren't emailing them directly, they're still emailing me. But there's this weird transition period. I don't think I'm ever gonna actually be out of working with those clients until we're $4 million plus. Just because there's been this relationship that we've built. And it sucks because I'm trying to tiptoe around saying things because there's a. I want to cover in the next episode, not in the Patreon version, the actual next recorded episode about account management. Because account management is where everything kind of breaks down as a super high valued skill that I don't think a lot of agency owners value very much. And I think that's the biggest problem is cultivating those relationships. And when you're the owner and you built a business on relationships, you can't just step away from that. So weird. Well, I figured we'd go over high level solutions.

Speaker B: That's what people want. They want the answers.

Speaker A: Yeah, I did want to say before I go into this, and this is, I'm going to mention some of this too. Um, in the premium version of this episode, we're going to talk about some very specific examples of and what some agency owners who are well above 5 million have said regarding this topic. Uh, especially like Jordan Brannan, who has an eight figure agency. When, uh, we talked to him on our podcast, he was over 10 million in revenue. Um, and, uh, he says very similar things, but he actually has really actionable advice that I think is. It's almost his advice. He didn't give me a direct number, but when you go over what he said, it's impossible to do it under 2 million. What I say actually makes sense. So his advice is definitely worth checking out. I sent him a LinkedIn message. I'm like, hey, could you answer this? Because people are thinking that you can step out under a million. And he, uh, wrote a book to me on LinkedIn, which I was super grateful for.

Speaker B: That's awesome.

Speaker A: Yeah. Um, all right, so I have like four points to this. So the first one is you have to reset your expectations. So working. There's this phrase where it's like, I want to work on my business rather than in it. Uh, well, those two aren't mutually exclusive. You can do both at the same time and you should Be doing both at the same time. You need to continually do both. That's why you're compensated more as an owner. That's why you receive profit distributions. The only people working exclusively on their business are pushing well past 5 million. So, like, you even look at Joy Hawkins. She was on our podcast a while back. She's $6 million plus SEO agency and she's still working full time, working in SEO clients herself. So like, if she's doing it and you're trying to step away a little bit earlier, there's probably a reason, uh, that her agency is as, as successful and she's still working in that agency space or that client relationship space, I should say. Uh, the next point is have some self awareness. So what kind of agency are you? Can you actually step away? Uh, are you productized, niche, specific? Um, because if you are, you can likely step away a lot earlier than a boutique agency. So, like example Leverage Lab, um, they're a boutique agency. Everything is custom. They have very advanced solutions. I doubt Anne Marie is going to be able to step away until they're basically sold because you just. That's crazy. Uh, for us, I bet we can step away probably a little bit sooner because we are productized and niche and we do have, we've cultivated a relationship with our prospects and our clients before they even sign on with us, just because we're well known in the landscaping and lawn care industry. Whereas if you have a bunch of different types of clients, nobody really knows who you are. If you don't really have a niche, they just found you or they learn from you somehow. And maybe they built that relationship that way, but, um, they have to build. Either you build, you start kind of like relationship building in your niche early on, or you spend that first six months with a new client really building that relationship with them. Um, but the sooner you step away, regardless of the type of agency you have, the worse the quality becomes and the more problems you'll face. So, um, just keep that in mind and always keep a finger in the pulse. There's a, uh, third piece of advice I have is there are no shortcuts, so you don't get a pass to work less just because you're the business owner. Everyone in this world needs to work just as hard as the janitor. That's life. Suck it up. I started this agency because I wanted to have control over my time. And I've made the joke on this podcast that I wanted to be in control of my schedule. I wanted to control when I got to work the question was, which 16 hours of the day did I want to work? That's just life as a business owner. If that's not for you, then you're not cut out for this, and that's never going to change. I think Even when you're 10 million plus, you should still be working pretty hard, uh, on the business. So I got a lot more to say about that in the Patreon version, by the way.

Speaker B: Hard. Agree. Upvote.

Speaker A: Yeah, yeah. Uh, last piece of advice here. Uh, a business on autopilot does not grow. So I think this was like, kind of like a. Caesar had mentioned this in a few of his past posts. He was like, I kind of. The business is kind of on autopilot. And he was saying things about how he was kind of bored and you're trying to figure out what to do. Uh, every day he's like, I got like. He's like, I wake up and have like four tasks and that's it. And I just do that. He's like, I'm kind of bored. He even started a couple other side businesses. Uh, one of them didn't work out. And so, uh, this piece of advice is, uh, autopilot is not a good place to be. Autopilot means your engines are stalled and you're gliding. Going back to zero on this mode is inevitable because gravity will catch up. Uh, you are bored because you're not focused on growth, period. That's it.

Speaker B: Yeah, there's no homeostasis. Right. You get worse or you get better. That's how it goes in business too. Like, if you're not growing. Good. Good luck. Good luck staying where you are.

Speaker A: Certain businesses, certain parts of your business can be on, quote, unquote, autopilot, but your attention has to be somewhere else. Like, like, we can have like an autopilot where, like, uh, account management is on autopilot, but we still have to have a finger on the pulse because if things are. Or if the quality is reducing, we got to figure out how to improve the quality. So I've mentioned earlier, like, Cody and I are like, we're notoriously bad at communication. Not him and I personally, but our agency in general. And so, like, we can't just be on autopilot. We're on autopilot for that, for that right now, because we're not addressing that directly at this moment. So it's gliding further and further down. And at a certain point we have to start addressing that. How can we fix that? So, uh, we can add more value and continue to grow and even improve retention beyond what it already is. So, um, I want to, in the, in the premium version of this, we're going to go through those, those four pieces of advice a lot more in depth, like actual strategies and tactics of things that we're doing regarding those four things, but also the juicy Caesar timeline of the 20 month, um, breakdown of why his agencies. I don't want to say quality because none of his posts really mentioned quality, but I think this one and a half month time frame of him stepping away, um, and losing ten, uh, thousand dollars in mrr, I think it was a slow buildup and he jumped in and kind of corrected it and saved it. But I think he needs to be very cautious about some of the things I want to talk about in the timeline leading up to it. And I think a lot of you guys can take some lessons from that as well.

Speaker B: I'm stoked.

Speaker A: Cool. All right, well, for everybody else, thanks for listening and we'll see you next time. See ya.