3 Big Lessons from a Four-Time Agency Owner
Wish you could eliminate the growing pains of running a digital agency? Wonder what pitfalls you could avoid if you knew in advance? With 3 big lessons from starting, growing, scaling, and exiting multiple agencies today’s guest shares a ton of knowledge on everything from business partners to building a team to merging with a bigger agency.
In this episode, we’ll cover:
- Merging with a bigger agency.
- Building an agency team based on culture.
- 3 misconceptions on bringing in a business partner.
Today’s interview is with a four-time agency owner, William Harper who’s the CEO of WM Harper, and former owner of three other agencies which he has successfully grown and exited. It’s been a hell of a ride for William, so I’ve brought him on the show to share the lessons he’s learned along the way.
Lesson #1 – Merging with a Bigger Agency
The grass isn’t greener, but William says he and his partner learned this lesson the hard way. They took grew their agency (William’s first of four), Underground, lean and mean. They started winning industry awards and getting noticed. They were landing more and bigger clients, which got them noticed by other agencies. Eventually, an offer came from a 100-person agency, Eisner Communications and William’s agency, Underground, merged with Eisner.
On the outside, it appears that a merger will open new doors to resources and technology not otherwise available to a smaller agency. However, William and his partner quickly learned those big corporate resources come with a price.
Underground lost the ability to be nimble with their clients and projects. Their processes were quickly changed, existing clients prices were increased, and the agency was forced to fit into a corporate mold.
My advice is, do not merge with a bigger agency. If you do, keep your eyes wide open to what it will look like. The grass is not greener. If you’re looking for an exit strategy – just sell, don’t merge.
Lesson #2 – Building an Agency Team
When William went on to build another agency, he took with him the knowledge of the former and decided to grow his team based on culture. Instead of hiring talent, he viewed it as curating people.
Talent and skill are important, but he says his interview questions would also include things like:
- Why do you love this business?
- What do you want to achieve next on your career path?
- What are your overall goals?
- Do you want to lead? Create? Work independently?
We agree that hiring based on culture fit is more important than hiring based on talent. Specific skills are teachable, but matches of personality, values, and beliefs must be present from the start. William quoted a statistic that something like a mere 13% of people are engaged in their job. You need your agency team to reflect the 13%, not the remaining 87%.
Lesson #3 – Bringing on an Agency Business Partner
I often advise people against bringing in a partner. As I say, “you either know the bad partner or you are the bad partner.” After about one year, I brought in a partner to my digital agency. And, over the years, William says he’s had great partners along the way in each of his agencies. But he too advises against it now that he’s been through a variety of scenarios.
There are a few misconceptions about bringing on a business partner:
1- You need a partner in order to convince clients to work with you.
FALSE. A partner does not provide instant credibility. You can be an authority on your own. Build your team based on values and you can count on the culture to provide checks and balances.
2- You need a partner to fill in your own gaps.
FALSE. Surround yourself with people smarter than you in certain areas without giving up ownership. It is possible to get that yin and yang flow in your agency without a partner.
3- You need a partner to call BS when necessary.
FALSE. A lot of agency owners wish they had a sounding board for making decisions. Instead of giving up a piece of ownership to a partner you can hire a mentor, join a mastermind, or create your own board of advisors.
While it might seem like a good idea to bring in a partner, oftentimes issues arise when the partners need different things out of the company for different reasons.
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