We just came out of a brilliant session with 3 absolutely epic people. Giving raw stories and no BS advice about how to scale an agency. Thank you for giving me the opportunity to listen to you: Rachel Bell, Gellan Watts and Jim Bowes.
Here are my top 10 things we’ve learnt about Scaling from agency owners who have been part of building agencies in excess of £15M fee income:
- No matter what size your agency is. Don’t lose the ‘heart and head’ mentality. The challenge is keeping a startup feel in a big business.
- Get your equity sorted from the start with a solid shareholder agreement that includes a pre-exit agreement. Be wary: A 10% shareholder in a 45/45/10 split, can be the one who ends up making all the decisions…
- Be smart about your LTIP and STIP for team members. The harsh reality is that there will probably only be one or two senior team members (most often even fellow co-founders) who will go the whole journey with you – everyone else will leave or will need to leave at some point.
- Before you sell consider: What business do you want to be part of? What life changing sum of money do you want to take off the table? Are you happy right now?
- Remember that if you’ve run out of steam and exit, you will need a whole new type and level of energy in the next phase…
- Don’t have a one size fits all reward incentive structure for the ‘big prizes’. The thing that is equal is the opportunity. But not the reward.
- If you are comfortable and you have no personal ambition to grow. Plan for your succession, by getting a hungry senior team to plan the vision of the next level of your agency.
- Job title changes doesn’t mean that a person’s skills has changed. They will still need the mentoring (internally and from external advisors).
- Get smarter about financing options.
- Buying an agency does not initially cost what you think it does. All you need is the initial part. The rest is back loaded and tied into agreements that penalise should the seller not reach their targets.
And a bonus one for you to mull over…
Confidence is everything! Hope means nothing.
Would love to hear what other thoughts you have that you learnt about scaling agencies?