The agency model
Starting an agency is probably the easiest way to get into business.
The three things you need are: a skill, some time, and a client. If you consistently put out good work, you will get more clients.
The more clients you get, the more overwhelmed you will be and the more you will start to look for shortcuts.
If you are not careful, the quality of your work will start to degrade. Eventually, you will start hiring people to do things for you.
Ideally, you will hire people that are better than you at things (but that can be hard sometimes for new business owners).
To be able to pay your new hires you will need to have a consistent flow of new clients or projects every month.
Even if you don’t have any projects, you still need to pay the people you have on payroll. So to avoid not being able to do so, you start saving money.
Many agency founders follow a rule of thumb: “Keep 3 months of payroll in reserve for bad times”.
If you stay long enough in business and start making a name for yourself as an agency then its possible to make a decent amount of money.
There are many examples of successful agencies that are very profitable but most agencies only break even.
The constant stress of finding new clients takes a toll on many agency founders. The ones with ambition realize that the agency model is easy to start but very hard to scale.
And I agree.
Building a SaaS
Many agency founders decide to productize their services or package and sell things. Things such as templates, designs, checklists etc.
I’ve been exploring this too. But the businesses that are very appealing to me right now are SaaS businesses.
Essentially you build a software product once and you just sell the same solution to multiple clients, ideally on a recurring basis (monthly, yearly, etc.).
Since we are already building custom software for our clients I took some time during the winter holidays to brainstorm a few SaaS ideas.
I wanted to come up with something that a) Solves a problem for b) one type of business. The first thing I did was look at all the projects we had worked on in the past year.
Was there any overlap? Are the clients in the same industry? Would a similar business that isn’t our client yet, want to use this solution?
But then I thought, what if we combine a few solutions together?
I took my pen and circled three features that I thought would work well together:
- Logging
- Location tracking (GPS)
- Map customisation and data visualization
These three would become the foundation for our new SaaS.
We started working on the project on the 3nd of January. We named it Mission Control.
Together with the team we juggled the work we had to do for our clients and the work we had to do on Mission Control.
Within a month and a half we had a working MVP! I was super proud!
There were features that we could continue to develop but I decided to start giving demos. I had to make sure we were on to something. I sent out emails to friends and partners from different industries asking for feedback.
I gave about 20 demos in two weeks and collected loads of feedback and ideas. If you were one of the few people that accepted my request for a demo, THANK YOU.
Next steps
Right now, I have made a list of businesses that might benefit from our new tool. I will reach out to them asking if they want to do a pilot with us.
Currently the main industries that can make use of our new tool are:
- Local Governments
- Spectator Events
- Large Construction Projects
Focusing on one specific industry will make the solution more focused and useful. So at some point (soon) I will need to decide in which direction to go.
Let’s see!
Key takeaways
- When you give a demo and you have a feature that isn’t developed yet but might be beneficial to your client, mention that feature and explain how it works.
- You will already have thought about the ideas and features people come up with. Don’t tell them that. If you do, they will try to come up with things that others haven’t thought of and usually those ideas are not good. Instead, write them down and thank them for the idea. When many people point out the same thing, you should focus on building that next.
- Focus on good planning when juggling client work and internal projects.
- Your team needs to align with your vision. Make them understand WHY you are building this and HOW it will help.
- Giving demos of this project actually got us new clients. It’s a great way to showcase what you can do as a team.
I’ll try my best to write updates about this project on a weekly basis and share the things I learn along the way.
Are you interested in a demo of Mission Control or any of our services? Reach out at hey@nevron.io