Where there is no vision, the people perish.
-- Proverbs 29:18
It’s critical that you build your business with the end in mind.
If you’re like us, you started your business for two reasons: abundance and impact.
Building an agency is great for cashflow, but as you likely know already, it can be very difficult to scale.
Below is a roadmap for the evolution of your agency that you can use to map your journey from agency to information products and software.
(Of course, everyone’s path is different, but it’s important to model a tried and true path then apply your own unique style to it)
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Level 1: Freelancer
Situation: Working a ‘job’ for a few clients on a DFY basis. Doing 80-100% of the work by yourself.
Profit: Highly profitable but not scalable at all.
Problem: Trapped trading time for money and your income is capped.
Solution: Transition to agency model to charge 2-10X more, assemble team and delegate workload
Level 2: Agency
Situation: Selling custom services to a handful of clients. Working with a small team of contractors.
Profit: Low profit margin in the 5% to 30% range.
Problem: High churn rate, low lifetime value and frequent burn out. Unable to grow without spending more time and money.
Solution: Productize your services to multiply revenue, profitability and scalability.
Level 3: Productized Agency
Situation: Thanks to your productized model, your business is more profitable, scalable and predictable. Capacity for approximately 10-50 clients.
Profit: Good profit margins in the 30% to 60% range.
Problem: Client retention can be improved. Seeking an even more profitable, scalable model.
Level 4: Productized Info
Situation: You are selling high-ticket information in the form of courses and/or coaching. Your margins are incredible and the model is very scalable.
Profit: Great profit margins between 60 and 80%.
Problem: Optimizing and managing marketing, sales and client success can be challenging and profitability can fluctuate when trying new acquisition channels or methods.
Level 5: Productized Technology
Situation: You have converted your proprietary processes into scalable technology or software. You have essentially become a tech company. Churn rate is low, LTV is high and if you want you can sell your company for 10X+ multiples!
Profit: Amazing profit margins over 80%.
Problem: Software and technology is a competitive space. Your marketing and sales must be on point at all times or acquisition costs can fluctuate.
Agency Roadmap
Answer the following questions... 1) Which level are you currently at? 2) Which level do you want to be at within the next year? 3) WHY?