Context Collapse: The 5 Basics Of Running A Small Agency
Industry inside baseball revealed: CC #222
In this issue: The basics of running a boutique agency/consultancy. I’m writing this specifically for people working in marketing, PR and advertising, but I hope this advice is useful for anyone.
Hi. Welcome to Context Collapse, the world’s best comms newsletter. I’m Neal Ungerleider. I run Ungerleider Works and used to work as a reporter for Fast Company, write op-eds for the LA Times, and work as a senior copywriter for R/GA. This newsletter helps readers navigate the weird new world of media and gleefully ignores all the conventional wisdom about marketing, public relations, advertising, and marketing.
Hello there. So… running a small agency!
I’ll put my cards on the table first. I have been working in media since 2005, began freelancing full-time six years ago after a layoff, and now run a small consulting firm where I am the sole full-time employee and I have several talented contractors assisting me. We generate less than $250,000 revenue per year and specialize in taking on projects that don’t make sense for larger agencies.
In my book, small agencies are any agencies with fewer than 15 full-time employees who aren’t owned by a larger holding company. There’s a much larger middle range of agencies that goes up to about 500 employees or so, and an equally large band of large agencies who can have thousands upon thousands of employees.
I entered the consulting world as an expert with extensive journalism and advertising experience. What I didn’t have was business experience. I know a bit more about how the game is played now, and I hope this post is useful.
In this post, we’ll discuss the five basics of running a small or boutique agency.
1. Be Clear On Your Agency’s Mission Statement.
So you started a business! Good! Now you’re working in a crowded field with lots of competitors. Your competitors are also good at what they do. One crucial thing you need to do is figure out what your agency does… and what differentiates your agency from competitors.
I like to make a simple one-sentence summary that consists of a “XXX does this and is different because of YYY” format.
For instance:
“Ungerleider Works specializes in marketing communications for B2B clients and is different because it is able to work on creative projects more effectively than larger agencies.”
Here are a couple of examples:
The 100 Agency offers SEO, social media and content marketing services to home contractors in the Indianapolis area and is run by a team with professional experience in residential HVAC.
Writenow brainstorms, scripts and repackages video for YouTube, TikTok, podcasts and other formats and is different because their founders made multiple 1 million+ view YouTube videos.
Note: Make sure your mission statement is clear on the kind of work you want your agency to do (so you don’t get stuck in the hell of being a generalist without a market niche) while also leaving room to expand into adjacent fields (for when you either want to grow your business or have wiggle room when work is slow).
2. Make An Agency Home Base.
Creatives—and I’m including most marketers, advertising and PR folks here—love disorganization. However, disorganization is the death of any agency.
Make sure your business has a central home base that covers the following:
Central work repository
Project management
Company records
Clients/customer relationships and CRM
Accounting and bookkeeping
For instance, my agency uses Google Drive as a central repository with projects managed on Notion and The Futur’s Operating System for Notion, with Hubspot for customer relationships/business development, Gusto for payroll and Xero for bookkeeping. Using a handful of software platforms and AVOIDING HAVING IMPORTANT STUFF SCATTERED AROUND PAPER, DROPBOX, SHAREPOINT AND ICLOUD LIKE THE PLAGUE has saved endless work hours and made it much easier to grow our business.
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3. Outsource Bookkeeping And Time Sucks.
Your agency’s business model should focus around hitting and exceeding your revenue goals and not on spending potentially billable hours on work that does not need to be done by you or your team personally.
I highly, highly recommend using an external bookkeeping service, external payroll and having a lawyer you are comfortable forming a working relationship with—someone who can review contracts as needed and give you legal advice as needed instead of spending hours frantically googling. (And, no, r/legaladvice doesn’t count.)
Be ruthless about outsourcing any timesucks that take you or your team more time to do then they should. Project management taking up a whole lot of time? Outsource that stuff. Finding new leads taking forever? Outsource that stuff. Video post-production or localization taking forever? Outsource that stuff.
Outsource, outsource, outsource. I guarantee that the money you spend is worth the free time you will save.
4. Write Down How You + Your Team Do Things.
Small agencies have many competitive advantages that larger agencies lack. They have much less bureaucratic overhead. They are able to embed in client workflows more easily. They are often able to do projects more quickly and more cost-effectively.
But small agencies can be limited by their size and reliance on one or a few key individuals. What happens when a new employee needs to be onboarded? Or, well, what happens when the founder/owner is going on vacation?
There’s a great book for small businesses called The E-Myth Revisited that has one excellent piece of advice in particular: Write down every workflow and every process your agency has for doing things. Onboarding a new client? Write the process down. Putting together a Powerpoint? Write the process down. Making a podcast? Write the process down.
This will benefit you and your team for two reasons. Firstly, it will significantly reduce the amount of time you personally spend onboarding new hires/contractors and will cut down on the amount of time you spend training your team in the future. Secondly, it makes it much easier for you to take time off of work or deal with emergencies.
When the unexpected happens and you’re dealing with a crisis, you can make sure your business is taken care of and focus on the emergency instead of panicking over running your business in addition. This is a very easy way to make your founder life easier.
5. Biz Dev, Biz Dev, Biz Dev.
Biz dev (aka business development) is the fiddly act of both lining up new work with existing clients and of finding new clients. This can be done through either inbound marketing (like a landing page, a webinar or a newsletter) or outbound marketing (like cold emails or paid social media advertising).
One of the most common errors small agencies make is focusing on existing client work while neglecting building a business development pipeline for 3 months, 6 months, and one year down the road. As a small agency owner, you want to do everything possible to ensure a steady stream of client work and that any slow periods are minimized. This means making sure you’re always finding new projects for the future even when your business is 110% busy with existing client work.
I highly recommend using a good CRM (customer relationship management) software to keep track of projects in development and of emails/texts/meetings/phone calls with current and potential clients. Hubspot has an extremely powerful free version that will meet the needs of most small agencies and is relatively easy to use; I highly recommend using it.
Next in our series: Small agency timesavers.
Questions or something to add to the article? Leave ‘em in the comments.
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