What to think about when starting your agency

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Chip Griffin: Hello, and welcome to another episode of the Agency Leadership Podcast. I’m Chip Griffin.

Gini Dietrich: And I’m Gini Dietrich.

Chip Griffin: And Gini, I’m going solo on this podcast going forward. I’m out. I’m gonna start out on my own.

Gini Dietrich: Peace.

Chip Griffin: Right after this.

Except I’m not gonna do that, because…

Gini Dietrich: I know you’re not.

Chip Griffin: It’s just it’s this is kind of fun. So.

Gini Dietrich: Yeah, it’s kind of boring by yourself.

Chip Griffin: Yeah, well, I mean, I don’t have any problem listening to myself speak. I think most listeners have probably figured that out already. In fact, a lot of times on, on the show, I have to consciously remind myself, shut up, stop talking, stop talking.

Because I’ll look at the transcripts and it will show percentage of time speaker one, speaker two.

Gini Dietrich: Oh, it does?!

Chip Griffin: Yes. And I’m like, oh, oops.

Gini Dietrich: That’s funny.

Chip Griffin: So, yeah, so it’s kind of like a solo cast some days, you know, when I just can’t shut up and don’t let you get a word in edge wise, but I’m not gonna do that today.

We’re gonna have some good balance to the conversation because we are talking about going out on your own, but not me taking this podcast solo, but rather, listeners who may be working in house or at an agency thinking maybe it’s time to hang a shingle. Yep. And so what are some of the things that you have to be thinking about?

What are some of the things that, that folks are struggling with as they look at that? And we’ve had a number of questions that have popped up in the Spin Sucks Community and elsewhere of late, where people are considering this or thinking about different angles. And so I think we can talk about some of the common challenges when you’re just getting started.

Gini Dietrich: Yeah. You know, I always say that making the decision to go out on your own is the hardest part. Because once that’s done, you’ve sort of, kind of figured it all out. I mean, just what, what needs to be – right. What needs to be done from the perspective of, okay, I can replace my salary. I can figure out my benefits.

I am gonna make sure that we still have a roof over our head. Like all of that stuff is the stuff that drives anxiety, right. That produces the nerves and all that kind of all those kinds of things. So once you figure out and you say, okay, I know I can do this. And here’s how I’m going to replace those things so that I’m going from a steady paycheck to maybe a not so steady to paycheck, I’m going from benefits to no benefits. I’m going, you know, all of these things that you have that you’re perceiving you won’t have when you go out on your own. So making the decision to do it is the hardest part. And then you have to figure out, am I going to specialize?

Do I need to do sales? What percentage of my time should be sales? Do I need to offer all things to all clients? Do I work with any client just because I need the business? All of those things are decisions you have to be making.

Chip Griffin: Well, and, and a lot of those things circle around, how do you generate revenue?

Yep. Right. Because once you’ve decided to pull that trigger, and it is absolutely the biggest hurdle to get over. The second biggest hurdle is typically hiring your first employee. Yes. Because that then changes the whole dynamic of your business. But once you’ve gotten over that hurdle and, you’re out there and you’re like, oh, I actually don’t have a steady paycheck coming.

I kind of need to keep generating revenue and profit so that I keep putting money in my pocket and food on the table.

Gini Dietrich: Yeah. And it’s, you know, it’s really, it can be really scary. So when I went out on my own, I had a client that was going to pay me in an annual retainer a little bit more than I was making in a salary.

There were two things that were important to me. One that I continued to make my, the salary that I was making at the agency, and that I could make my BMW payment.

Those were the two things that were important to me.

Chip Griffin: Priorities.

Gini Dietrich: I was in my early thirties, like, that was important. And so once I knew how I was going to replace that income, I was ready to, to make the jump. So the, it truly is the hardest part is making the decision to do it because you have to figure out those kinds of things.

And then once you’re in it, and certainly most of you that are listening to this podcast are either in it or about to go in it. You do have to think about all these other things. Am I going to have employees? Am I going to use contractors? If a prospect comes to me and they want media relations and content and social and some paid social, can I do all of those things or do I need to find partners to work with? What am I gonna do about benefits?

What am I gonna do about paid time off? If I’m not working, I’m not billing my time, can I have that time off. So all these are all the things you have to be thinking about. Who’s gonna be doing business development? Is that me? What percentage of my time should be spent on bus dev? Lots and lots and lots of decisions to make.

Chip Griffin: A huge number of decisions.

Of course you can’t tackle them all at once and no, you will struggle if you try. And I do know that that some folks want to sit down and, and particularly there are a lot of planners who listen to us and they, they want to plan everything out and plot the steps and, and all that. And you can start doing that, but you, your plan’s gonna get tossed out the window halfway through your first day, so right.

You need to be flexible and, and, and make adjustments as you go, because what you thought was the right path forward before you pulled the trigger, may change a week, a month, a year in, as you gather additional information, as you frankly, figure out what you enjoy doing and don’t enjoy doing. What can you do well in that environment versus what could you do well when you were in a larger organization, right? All those things will change. So you need to be able to be flexible and move with it. But something that you said, I think is one of the, the keys for a lot of folks, which is to start ideally with a client out of the gate. Yeah. Right. So don’t, don’t hang your shingle until you’ve lined up at least your first piece of work.

And it doesn’t have to be necessarily as good as what you describe, where it’s the one retainer that covers your whole previous salary and your car payment. Because that’s, you know, we all have priorities, I guess.

Gini Dietrich: That was my priority.

Chip Griffin: And I guess if you don’t make rent, you could at least live in that car.

Gini Dietrich: Correct. It was nice enough that I could live in it.

Chip Griffin: Yeah. There you go. Okay. So to each their own. So you have to be thinking about those kinds of things. And so it will certainly increase your comfort level if you’ve been able to line up the business in advance. Now, obviously that’s dependent upon your own work situation, right?

There are some jobs that you have where you can line up clients while you’re still employed. Others where that would be frowned upon. And so you need to make sure that you’re following the right rules and regulations there. So you don’t start out with a problem right out of the gate. But it will really help you if you’ve got that a little bit of success on the business development journey first, before you really have to fight and claw and do everything to keep growing your revenue.

Gini Dietrich: Yeah. And there’s also something to be said, between doing business development because you’re desperate and business development because you want to grow.

And just like in any other situation, if you’re desperate, people can sense that, and it’s a lot harder. But if you have enough lined up that you’re comfortable, that you can pay your bills and make your car payment, and allow you to, to be able to not be desperate, but to be able to go after the rights kinds of clients, the right kinds of prospects, you’re gonna be much more successful. Because in desperation you make all sorts of bad choices, bad decisions.

And when you’re really thoughtful about it, because you have the ability to do that, you tend to be, it tends to go a little more smoothly for you.

Chip Griffin: Absolutely. Now let’s, let’s touch on some of the specific questions that we’ve gotten from folks who are thinking about going out on their own or, or just getting ready to do it.

And so one of the common ones is, should I be doing actual traditional outbound sales? Should I be following the PESO model for my own agency? And folks who listen to us know that we are big believers in growing your reputation and attracting people to you. But you’re right out of the gate. You don’t have that reputation at least as, as a solo or an agency, you have that reputation from things you’ve done in the past.

So how do you transfer it and do you need to engage in more traditional sales tactics to get started?

Gini Dietrich: Yeah, so, you know, there, there are a couple of things about outbound sales. First of all, you have, you have to do business development. I don’t like to call it sales. I like to call it business development.

I think it’s different. Maybe not.

Chip Griffin: It’s a, it’s a hundred percent different. And I think that, that, that’s why a lot of agency folks get hung up because they think of it as sales. And as soon as you say sales, people think, Ugh, used car salesmen.

Gini Dietrich: Used car salesman, right.

Chip Griffin: And that is not what agency business development is or should be.

Gini Dietrich: Yeah. I, and you know, I actually had a new business call last week. You and I have talked about this on this podcast where it’s more listening and asking the right questions than it is talking about yourself, or, you know, doing the dog and pony show. And so we had this new business meeting and I ask, you know, I have a list of questions that I ask.

I also ask a lot of, of questions to determine if there are red flags, but you know, reasons we wouldn’t wanna work with with the company. And I’m going through the questions and I’m asking, and I’m asking deeper and I’m asking, you know, they keep saying, we need to be on TikTok. And I kept asking why, so that I could get to the, the real issue of it.

And about two hours after the call ended, the CEO emailed me and said that was the best, most insightful conversation I’ve had in years. And I was like, I didn’t say anything. I just asked questions. So when you think about it from that perspective, you’re not selling, you’re not saying we’re great. We’re awesome. Hire us. You’re asking really insightful questions to help you understand whether or not this is going to be the right client for you and in return because of the questions that you’re asking and the way that you’re approaching it, the prospect thinks you’re brilliant. You haven’t even done or said anything, which is amazing. And you’re not selling. So change your mindset from that perspective.

Chip Griffin: Well, and, and part of the reason that works is because so many others in the agency space rush in and just want to, you know, blab on about all the great things that they can do and how smart they are and how much success they’ve had.

And, and they want to pitch you on a specific idea. And, so it’s a very different experience for most prospects when you do come in with those intelligent questions. And frankly, sometimes they don’t even have to be all that intelligent. Right. They can be actually fairly obvious questions. Right. But you can bet that, that the prospect hasn’t been asked those questions probably by any other agency or internally either.

Right. And so the fact that they get to start speaking and talking out loud about some of the things that they haven’t talked about before automatically makes you look smarter and that’s really helpful, but at the same time, you’re learning. You’re picking up valuable information and none of this is traditional sales.

Right? Right. This is not, you go in and, and you’re talking about all the features and benefits of it and you, and you’re trying to accelerate the close. In fact, I get that question from clients. How can I, how can I get this to close by the end of the quarter, I really need to hit my numbers in, you know, October or whatever.

And I say, you don’t. Right, right. Just be responsive to them and it will progress naturally. Don’t, don’t be a hold up. Right. Don’t take forever to respond to their questions or get them information that they need. But don’t try to artificially accelerate the process. Don’t engage in traditional sales tactics because A, you’re probably not comfortable with them, so you’re not gonna do them great.

Right. And B it’s not how you get good clients. It might get you a client and some revenue in the short term, but it’s going to burn bridges because you’re not going to get the right clients and the right business. So think about it in terms of business development. Think about it in terms of growing your network.

And if you think about it that way, it’s a lot less scary for most of you.

Gini Dietrich: Yes. And I will add as well that one of the things that I think most of us agency owners think about is how to hire somebody to help us with business development. Because it gets to the point where, I mean, and certainly in my business, it got to the point a few years ago that it was too much for me to handle.

It is one of the most challenging things that you can do, is to hire somebody else to do it because they don’t know the business as well as you do. They don’t know the team as well as you do. They don’t know the clients or the results that you’ve gotten for other, in other case studies, as well as you do.

And no matter how much training you do, they’re not going to be as effective as you are. And that might be okay. That might be okay. But you have to be willing to first do it yourself. So you understand the process, you understand the kinds of things that you need to ask. You know what your red flags are. You’ve created a process that’s easy to replicate and then coach and train and coach and train and coach and train. And still, nobody else is going to be as good at it as you are. So you have to be willing to take that… what’s the word I want? Loss a little bit, in order to scale. So you might go down a little bit in order to scale. But you’re going to, you will get there. It’s just not going to be as effective as if you do it yourself.

Chip Griffin: Yeah. And I would argue that, that you, almost no agency that I can think of should be outsourcing business development to another employee or contractor or whatever in its entirety.

Gini Dietrich: No, absolutely.

Chip Griffin: You used the right language before when you said help with, but that’s not help with the actual final portion of the process, it’s help along the way.

It’s help in maintaining lists for marketing, helping to set up appointments, helping to do the infrastructure type things that go along with it. It is not the actual conversations that lead to business development. Those are things that you need to own in a small agency, or particularly in what we’re talking about today, when you’re first getting started.

In fact, when you’re first getting started, you probably can’t even find someone to help you because you don’t have that revenue coming in to pay them. Right. Right. So unless you’ve got a beautiful severance check from your last employer you’re going to be in a position where you’ve gotta sort this out yourself.

Absolutely. And the way you do it is by engaging in a lot of the things that we talked about, but it’s not sales. It can be growing your network, right? Yeah. Which looks a lot like sales. Yep. It’s not, it’s having meaningful conversations with people who may or may not be able to buy your services or may or may not be a right fit.

But you’re, you’re gathering information. You’re getting your name out there. You’re finding new people to talk to. And so from a getting started standpoint, you absolutely have to do that kind of outbound work. Because nobody knows what you’re doing yet. And you can’t just build a website and throw it up and expect that business is gonna start pouring in tomorrow. It’s not.

Gini Dietrich: Right. No. It’s not, unfortunately it’s not. And I will tell you, you know, we have online courses and, and masterminds and coaching and all that kind of stuff. And, before the pandemic, I had a whole sales team focused on that and still, still, they would have the initial conversations and they would do a great job.

They could not close. They couldn’t. So when we got somebody to the point where, you know, it wasn’t a small investment, but we got somebody to the point where they were investing in one of our programs. I was the one who had to close. I was the one who had to have the conversation. And then it got to the point where I was kind of frustrated because I was still doing the, the actual work, but we were, it was taking more time because we had all these other people in the process.

Right. So you have to figure those pieces of it out too, because you know, you get to the point where you’re like, is this really worth it or are they really helping me? And we got to the point where we were like, they’re not actually helping, they’re actually hindering. So we stopped that process.

Chip Griffin: Well, the other problem is when you’re delegating business development, that person’s role is focused on business development.

And so what do they do? They bring in business. Is it good business?

Gini Dietrich: Right, right.

Chip Griffin: Is it, are the expectations set correctly? Maybe, maybe not. Because their goal and typically what they’re compensated based on is how much they’re actually bringing in from a revenue standpoint. That’s right. So I never in any agency want people to be closing business who are not having at least some role in delivering on the promises made.

Because that usually helps to constrain it into a reasonable place. Because the reason why most agency-client relationships fail is because of mismatched expectations. Yep. You have a client who’s expecting one thing, an agency who is expecting another. And when those don’t meet, you have a problem. And more often than not, the agency keeps their mouths shut during the business development process, because they just want to win.

Gini Dietrich: That’s right.

Chip Griffin: That’s a bad idea. You can’t change the client after the fact. Change them during the business development stage to see your way. And if they don’t, move on, go somewhere else.

Gini Dietrich: That’s right. That’s right. One of the other questions we’ve gotten is whether or not to specialize, especially going out on your own. You know, we’ve, we’ve heard, well, I’m great at content marketing or I’m great at media relations, but I also believe in the PESO model.

Should I be trying to do all of the things for all of the clients? Or should I specialize?

Chip Griffin: You need some kind of focus. And, and I think we’ve talked about, I hate the word specialized. It freaks people out. But you need to have some kind of focus. And that focus on day one may not be the same focus you have even on day 30, right?

Because you’re gonna learn as you’re having these conversations and growing your network, you’re going to learn what the market really needs at that point. And you’re gonna start to see what people actually want to discuss in terms of projects with you. And that may cause you to make some adjustments.

Then once you start delivering services, you’ll make further adjustments because you’ll realize, oh, I actually don’t like doing the social media management stuff. It’s kind of boring. It’s the same thing day in and day out day. Doesn’t do the interesting stuff. And I’m not picking on social media management today.

But it’s an example, folks. Okay. And so, but, and there are people who love it too. So you need to figure out what works for you. And then as you grow a team, your team needs to be factored into that as well, because you want to be doing more of what you do. More of what you do profitably. And that means having some kind of focus.

If you just walk around saying I’m good at media relations, I can do it for anybody. First I would say to you, I call BS. You can’t. You cannot, right. The same person who can do PR for the White House can’t necessarily do it for Kim Kardashian and a local restaurant.

Are there commonalities that come into play? Absolutely. But they are all different things and the skill sets that you need and the knowledge that you need and the connections that you need will be different for all of those.

Gini Dietrich: Absolutely. It’s funny you say that because when I started my business, I thought I could do media relations for all clients and quickly found out that no, that’s not the case at all.

I also happen to be in a meeting probably about a month ago with a lobbying firm and they were talking about media relations around an event and doing some stuff with Congress. And I was like, I mean, I’m good at my job. I was way out of my depth. Like it’s a totally different ball game. Not at all what we do, what I am accustomed to doing.

It’s a different, it’s a different game. So I think you’re right. That you can’t, that is BS. You can’t do those kinds of things. I would say if you’re going to go out on your own, pick an industry to focus on and pick a media type that you’re going to focus on. You can always bring in contractors or, you know, friends to help you out for the other stuff.

If somebody says, oh, you’re great at content marketing, we need to add email or we need to add social, or we do need to add media relations. You can bring in contractors to help you do those things, but focus on an industry, focus on one media type and then start to grow from there.

Chip Griffin: And, and look at your own history.

Look at the work that you’ve actually done and enjoyed and been successful at in whatever organizations you’ve been in previously. So, so start by thinking about that. And, and I’m talking about the work that you’ve actually done, not the work that you’ve overseen, right? So if you, if you’re coming from a fairly senior role and you had a bunch of different people underneath you, you know, if you oversaw someone who did video production, but you’ve never done video production.

Don’t hold yourself out to be doing video production now. Right. Okay. You may have enough knowledge to be able to oversee it and to ask some questions. It’s not the same as actually doing it. And so what you may need to do if you’re in that kind of a senior role today is think back five or 10 years and think about the kinds of things that you executed on well. Because when you’re first getting started, you’ll be doing a disproportionate share of the execution in all likelihood. Yeah, absolutely. There are situations where that may not be the case, but I would say 99% of the time, when I see someone go out on their own, they’re doing predominantly client service right out of the gate.

And that’s fine, but make sure it’s the stuff that you do and do well because otherwise you’ll have a mismatch. You can always evolve over time. And as you bring in revenue and grow your team, you can offer additional services, maybe ones that you were great at overseeing, but you have to hire someone to do the actual day to day work.

Just be smart about it. Don’t try to be all those things to all the people right out of the gate when you first get started.

Gini Dietrich: That’s a really great point. Because I think a lot of people go out on their own having overseen a team for many years, and then they have to roll up their sleeves and get their hands dirty again.

And it’s a big culture shock. So that’s another thing I think you need to take into consideration is you’re actually going to be pitching the media, or you may be doing the actual graphic design, or you may actually be developing the websites, or you might actually be writing the blog posts and the white papers, or you might actually be the one posting on Twitter every day.

Those are the kinds of things that you’re going to be doing when you’re starting out.

Chip Griffin: Right or, or you’re gonna need to charge so much that you can afford to outsource it. Right. And, and that’s a unique individual who can do it. There are ones who can do it, but you need to plan that into that focus that you have, because if, if you’re going to have to be charging those premium rates so that you can remain as just an overseer strategist manager, which is, I think the dream of a lot of people when they’re starting their own agency business, if you’re going to do that, then you need to be focused on clients who can pay that premium.

And will see the value in what you’re providing. So you, you have to have that realistic take on it because that’s where a lot of these situations go bad because someone decides to hang the shingle. They were really effective as a VP or a CCO or something like that. And so naturally I should be able to do this. Well, maybe.

Right. But it’s different. And so, you know, just because you enjoy eating at a nice restaurant, doesn’t mean that you can become a chef.

Gini Dietrich: Darn it.

Chip Griffin: You know, or maybe, or maybe you were a line cook back in college and then you went on and so you say, oh, well, I did that in the past. I can do that now and open my own restaurant and I’ll run the kitchen.

Maybe you can, maybe you can’t. You need to be realistic about what you can do, what you’re willing to do and how that impacts the focus of the business that you’re starting.

Gini Dietrich: I will say this though, in closing. Going out on your own is one of the most fruitful things that you can do for yourself and your career.

You’re in charge of your own destiny. You’re in charge of how much you make or how little you make. You’re in charge of – you’re the decision maker and the buck definitely stops with you. Now you may make decisions where you’re not making a paycheck or you’re not getting the right benefits or you didn’t hire the right team. And those are things that we all have to experience, but being in charge of your own destiny is something to be there’s something to be said for that. And so don’t let this conversation scare you away from doing it, but just understand that you should be prepared and planned for it.

Chip Griffin: Absolutely. And it, it’s a great learning experience as well. And I’m, I’m a big believer in, in lifelong learning and continuing to pick up things as you go forward in your career, and those things will help you not only in running your own business, it will help you in the advice that you’re providing to clients.

Gini Dietrich: Absolutely.

Chip Griffin: Because when you run your own business, you have a much better perspective on how your clients are looking at things because you need to ask yourself, how would I think about this? If this was someone doing this work for my business? Yep. All of a sudden, whole different perspective. And it really helps you give better advice, sell better services and have better results at the end of the day.

Gini Dietrich: Absolutely. 100 percent.

Chip Griffin: So hopefully we’ve produced some results for you in this conversation, given you a few things to think about. And I guess after this, Gini, I’m not gonna go solo.

Gini Dietrich: Well, thanks.

Chip Griffin: I’m gonna stick with you and we’ll continue. As long as you’ll have me, we’ll continue to have a two person podcast.

Gini Dietrich: Fantastic.

Chip Griffin: With that I’m Chip Griffin.

Gini Dietrich: I’m Gini Dietrich,

Chip Griffin: and it depends.