Do you feel like growing and scaling is always a struggle? Need to differentiate yourself from other agencies? Finding success as an agency owner isn't easy. But with the right mindset, you can hit the 8-figure mark and even power through an eventual agency acquisition. Whether you want to grow your agency fast or plan on growing it to sell, you need to hear from the one and only Mitch Joel, who's done it all.

In today's episode, we'll cover:

• 3 steps to an 8-figure agency.
• How to power through an agency acquisition.
• #1 way to differentiate your agency.

Today, I talked with Mitch Joel, co-founder of Mirum and founder of Six Pixels Group. Joel is a marketing superstar. He was one of Canada's Top 40 under 40, does keynotes for top brands, and has a best-selling book, Six Pixels of Separation. Mitch also sold his agency Mirum to WPP (a.k.a the world's largest ad agency). And he's on the show to talk about how he was able to grow, sell, and move on from his agency.

3 Steps to an 8-Figure Agency

For many agencies, the 8-figure mark is the "we made it!" moment. But how do you get there? Honestly, everyone's path is a little different. That being said, here are 3 universal steps you'll probably need to make.

1. Take on the right partner: There are two things that make a partner great. They need to have the same goals, and they need to compliment your weaknesses. If you're a master salesperson and you're looking for an agency partner, don't look for a salesperson. Find someone who is amazing at the things you're really bad at. Otherwise, you may both end up trying to play to the same tune. And that can lead to a nasty breakup.
   

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2. Get a marquee client: Landing your first big client can completely reshape your agency. You can go from pennies to dollars overnight. It only takes on business with a few friends to grow your agency fast. There's a misconception that you have to have tons of clients to grow. That's not true. You just need a couple of good ones. And they don't even have to big per se! But they do need to be able to pay your agency what you're worth.
   

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3. Have the right philosophy: You need to be scale-focused. What does that mean? It means that your processes need to be capable of handling scale. Think about your ability to support large-scale projects with big clients. If you feel like your foundation is weak, you need to build it up before you take on any big clients. Don't just chase big fish without a big hook. You'll get pulled overboard.

How to Power Through An Agency Acquisition

There's another way to "make it" without hitting 8-figures. Getting your agency acquired is the dream for many of you. It happened to me, and it happened to Mitch. But what do you do when it actually happens?

Your first instinct may be to go out and spend the cash. Don't do that! You have to wait until the acquisition is 100% finalized before you celebrate. The entire process will take a while. And you need to be focused on continuing to grow your agency AND focusing on your new "biggest client" — the company acquiring your agency.

Force yourself to wait to celebrate. Afterward, you have to get used to not calling the shots. It's tough. You can always do what I did; go start a podcast. It gives you back some of the control you're used to. Plus, you get to help people out. It's a win-win!

#1 Way to Differentiate Your Agency

Are you tired of being a "me too" agency? Then change your philosophy. STOP trying to be like your competition and you do you.

Don't be like everyone else, but instead figure where you stand on these four things that set  you apart from every other agency:

1. Trust
2. Empathy
3. Chemistry
4. Authority

How can you create a differentiate using these four pillars to stand apart? First, create trust with your clients by showing tons of empathy. Develop amazing internal chemistry that is evident in the way you carry out your core values. And display the level of authority that conveys domination in your area of expertise. Then, use your messaging (website, social posts, etc.) to display this differentiation to your prospects.

Looking for a Payroll and HR Solution for your Agency?

Payroll and benefits are hard. Especially when you’re a small business. Gusto is making payroll, benefits and HR easy for small businesses. You no longer have to be a big company to get great technology, great benefits and great service to take care of your team.

For a limited time, Gusto is offering a deal to Smart Agency Master Class listeners. Check out Gusto.com/agency for 3-months FREE once you run your first payroll with them.

Considering a merger or acquisition to scale your agency? Wondering what's involved in selling, but overwhelmed at the thought of it all? Relax! The processes can be stressful, but it's totally manageable and can also be a great growth strategy. Whether you want to stay in control and grow your agency with an acquisition, or you want to exit your business with a massive payday, here's everything you need to know about agency mergers and acquisitions.

In this episode, we'll cover:

• 3 things agency acquirers are looking for.
• The best way to cure agency growing pains.
• Can you really grow through mergers and acquisitions?

Today, I talked with Jose Lozano CEO of 9thWonder — a full-service digital marketing agency with offices around the globe. Jose didn't start off with a massive agency, and he didn't grow one... he bought one! After selling his company to a massive organization, he led a group to acquire an agency to scale up. Jose shares why and how to scale your business by acquiring another agency.

3 Things Agency Acquirers Are Looking For

Selling your agency is an important decision. Are you really ready to sell? What will you do after you sell? Will you merge agencies and stay on, or get acquired and move on? The answers to all of these questions matter. But, before you can even start thinking about them, you have to ask the big question — is your agency sellable?

When CMOs and big organizations look at agencies, they aren't just looking at profitability. They're looking for opportunities. Jose has done internal M&A polling, and I've talked to thousands of agency owners on this subject. Here are 3 things that make your agency sellable.

1. Having Processes: You can be crazy-successful but still look like a bad investment. Having success is one thing — having a repeatable formula for success is a whole different ballgame. When you have the right processes in place it lets investors know you're successful and that you've broken your success down into a repeatable formula.
2. Being Independent: If you created your agency with the sole purpose of selling it, you're at a disadvantage. It's like when people buy a house just to flip it, they treat it differently because it's not their home and never will be. The same thing happens with agencies. Being an independent owner who has hustled and bled for their agency is huge. It lets people know you're personally invested in your business.
3. Niching Out: You have to have an unfair advantage. Why should an acquirer buy you? There are plenty of agencies out there but, if you do something better than everyone else — you're worth top dollar. Dominating a specific niche not only makes your agency more valuable to investors, but it is one of the best ways to be viewed as an industry leader.

The Best Way to Cure Agency Growing Pains

Your agency's size is not relative when it comes to stress. I've met agency owners with 3 part-time team members that were as stressed as owners with 30.

It's all about how you handle key areas of your business. What's causing the stress? Is it ops? Or are you having trouble handling team members? Whatever it is you have to pinpoint it and either hire it out or partner up with someone who gets it. Deciding to grow is a conscious choice. And it can be impossible to make that choice when you're busy managing your stress level.

Chances are, you know what's causing your stress. Maybe you're overwhelmed with finances and KPI's, or maybe you dragging your feet on hiring or firing. That's ok! If you feel like you're not cut out for the role of CEO the solution might be getting acquired or merging with an agency.

Don't be afraid to give away some of your equity to reduce your stress. Which would you rather have? Full ownership of a stressful, chaotic agency, or 80% ownership of a well-managed one?

Can You Really Grow Through Mergers and Acquisitions?

Yes, you really can! Giving away equity can put you on the growth fast track. And acquiring another agency can also be one of the smartest moves you ever make if you do it right. I know what you're thinking! How do you know what your agency (or another agency) is truly worth? You can check out this video on agency valuation. Bottom line, the answer really depends: How profitable are they? What kind of niche are they in? What's their profit margin?

Check out my post on how to double your growth with an acquisition. 

Looking for a Payroll and HR Solution for your Agency?

Payroll and benefits are hard. Especially when you’re a small business. Gusto is making payroll, benefits and HR easy for small businesses. You no longer have to be a big company to get great technology, great benefits and great service to take care of your team.

For a limited time, Gusto is offering a deal to Smart Agency Master Class listeners. Check out Gusto.com/agency for 3-months FREE once you run your first payroll with them.

Are you struggling to find the right clients? Wish your agency was working with bigger clients? Finding the right clients isn't easy — especially if you're trying to grow from freelance to agency owner. The secret is having the right qualification process and knowing who to say yes (and no) to.

In this episode, we'll cover:

• How to go from freelancer to digital agency owner.
• 3 reasons you might steer clear of big agency clients.
• #1 way to choose the right agency clients.

Today's interview is with Jesse Witham, the Co-Founder and CMO of Search Marketing Agency. Jesse has been doing SEO since he was young (like 14!), way back when keyword stuffing and digital directories were "SEO" so he knows the complicated evolution of the field. Jesse went from freelancing to owning an agency handling over $300 million in client SEO spend. He's here to share his story about agency growth and finding the right clients.

How to Go From Freelancer to Agency Owner

Going from freelancer to digital agency owner is natural. As a freelancer, you already have some clients— you just need to scale. So, why not start a business, hire a few people, and start serving more clients, right? While everyone has unique reasons for making the jump, they all share one thing in common — they're ready to go big or go home.

So how do you actually do make the leap? The biggest thing is making the first hire. Sure, setting up an LLC, creating a brand and logo are all important steps. But, the symbolic moment for the transition from "freelancer" to "agency owner" is that first hire. That's when you know you've gone from being solo to being a team.

And that's a lot of responsibility — suddenly you have someone relying on you. That's the magic line you cross when you go from freelancer to agency.

Your first hire doesn't have to be another creative or a salesperson. You should always hire for your weakness. You don't want a clone of yourself, you want someone who can fill the gaps you leave. Like the ying to your yang :)

Jesse's first hire was someone who could keep him organized; I usually suggest a first hire be a project manager.

3 Reasons You Should Steer Clear of Big Agency Clients

Big clients with their big budgets always seem appealing. Don't be fooled!  Here's the problem with big clients — they can make or break your agency.

Whether you're a new agency owner or have decades of experience under your belt, one thing never gets easier — turning down big budgets. Sure, big clients have tons to spend on marketing. But that doesn't mean those big clients are the best way to scale your agency.

There are 3 issues with big clients.

1. Inhibited growth: Having 5 huge clients can mean major revenue, but at what cost? When you have 5 clients that absorb all your time, it's tough to grow. You can't test new concepts on a multi-million dollar account. With smaller clients, you can more easily research, test, and develop new strategies and tactics. It's much harder with clients that are make-or-break accounts.
2. Lack of diversity: The bigger they are, the harder they fall. And when they fall, it can really impact your agency (but not necessarily a bad thing!). Having a few key clients is stressful. You're constantly in fear of losing them.
3. Big egos: When clients know they're your biggest, they may act like it. This leaves the client with the upper hand, and you without leverage. Big clients can also come with big egos. As an agency owner, your team expects you to handle those egos. That's tough to do when losing a single client can tank the agency. Having a bunch of similar sized clients allows you to be more selective.

#1 Way to Choose the Right Clients

It's important to know when to say no to clients, but the real question is — when do you say yes? The easiest way is to create some criteria. If they fit it, they're in. If they don't, they're gone. Easier said than done, I know. But letting a few rotten apples slip through can spoil the whole bunch. You have to create crystal clear criteria and stick to it.

What does this mean? It means saying no more often than you're comfortable with at first. But in the long run, you'll only be working with the ideal clients who you can really help be successful. That's a WIN!

Looking for a Payroll and HR Solution for your Agency?

Payroll and benefits are hard. Especially when you’re a small business. Gusto is making payroll, benefits and HR easy for small businesses. You no longer have to be a big company to get great technology, great benefits and great service to take care of your team.

For a limited time, Gusto is offering a deal to Smart Agency Master Class listeners. Check out Gusto.com/agency for 3-months FREE once you run your first payroll with them.