2 Mistakes That Led an Agency to Fire All Their Employees

By Jason Swenk on June 19, 2019

Do you feel like your agency is stuck with subpar employees? Think maybe you have all the wrong people but too afraid to clean house? Firing employees is never easy. But, underperforming or toxic team members will kill your agency’s growth. Check out the story of how one agency fired his entire team twice, the aftermath of the experience, and what he learned by rebuilding to a multi-million dollar agency.

In today’s episode, we’ll cover:

  • Why your agency needs a financial model.
  • Creating a culture of personal ownership.
  • 2 mistakes that led to firing all employees.

Today, I talked with Aaron Edwards, co-founder of The Charles NYC. Aaron quit his job, moved from London to NYC, and created a digital marketing agency. Since then, Aaron’s agency has grown into a multi-million dollar phenomenon. Success didn’t come without hard work and many lessons along the way. In fact, he’s had to fire ALL his employees twice. Talk about “cleaning house.”  Aaron shares some great growth tips, including how to inspire culture, and which two mistakes led him to fire his entire team.

Why Your Agency Needs a Financial Model

Aaron worked in finance before he started his agency. And, his biggest financial tip is this — have a financial model. This means pulling out spreadsheets and diving into some math (which is something us creatives aren’t usually in to). But, having a financial model can save you a ton of time and headaches in the long run.

Here’s a great way to get started. Think about the revenue goal you want to reach. Then, work the math backward to figure out how to get there. And, use those insights to create the right financial model. In most cases, you either need more clients or you need to charge more.

You also need to figure out how to build up cash reserves to make it through some lean times (think 3 – 6 months of salaries and expenses). Plus, you should obtain a line of credit for the small emergencies. Ideally, secure the line of credit when you don’t need it, so it’s already available for when you do! And, cut your margins down as slim as possible. Remember, putting profit first can growth hack your agency.

Creating a Culture of Personal Ownership

Want to know what kills agency culture faster than anything? Egos!

If your employees are taking failures too personally — they won’t last long. Every agency has failures, but the difference is how you recover from them. Teach your team to treat failures as learning opportunities. Every employee has to be able to take ownership within their role without worrying that a mistake or misstep will threaten their credibility.

To achieve this, you need an open culture. Employees should be able to talk to their leadership team about bad experiences. And, agency management should offer coaching/mentorship sessions to help fix issues. Don’t let failures drag an individual or entire team down. Create an open culture where mistakes and failures are embraced.

2 Mistakes Which Led to Firing All Employees

Aaron had to fire his entire team twice and rebuild the agency. Looking back, he says two big mistakes led to the massive house-cleaning:

  1. Not providing enough opportunity. You have to give your employees the opportunity to grow and communicate what that growth looks like. This means providing a clear roadmap to success at every step. It’s not enough to tell them they can advance within the agency — they need to see it what that looks like. Aaron says his mistake was not providing showing his employees how to grow within the agency. When you don’t do this, the good ones look for opportunities elsewhere. Or worse; productivity decreases as they get complacent.

  2. Not hiring for culture. You can teach someone skills; you can’t teach them culture. Always think about how a new hire is going to fit into your company. If you don’t, you may end up with a mishmash of different personalities and a bunch of cliques. If you see one of your employees isn’t participating and they don’t seem like a good fit, its ok to get rid of them. One bad apple spoils the bunch. And, when your entire team has a poor culture, firing them all may be your only option.

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