How Do You Scale an Agency Without Losing Control? - Mads Singers

Sasha Damon (00:01)

How do you scale an agency without losing control? I’m here with Mads Singers and he’ll let us know. Mads, how do you scale an agency without losing any control?

Mads Singers (00:12)

When you’re looking to scale an agency, there are a couple of parts that are critically important. Initially, when scaling any company, it’s important to know that every company has the same four key components: sales, marketing, operations, and finance. That’s pretty much any business — those are the key components you’re dealing with.

What happens in most businesses is that at least one of those is always the bottleneck. If you’re doing amazing on sales, you might be struggling on operations and delivery. Or you might be struggling financially — maybe you spend a bunch of money to deliver before you get paid. So depending on the business model, those four areas are key to be on top of and understand.

Mads Singers (01:09)

Once you understand those and you’re looking to scale, the second most important thing from my point of view is making sure you have the right core process for your business. That means a scalable, repeatable thing you do over and over again — and fundamentally, one that can be done without the business owner himself. You can put people into the weeds and get it done on a repeatable scale, with a clear expected outcome on a regular basis.

Mads Singers (01:44)

Once you get that right, you need to build the marketing machine. The marketing machine is fundamentally about figuring out — initially — not to do everything. Everyone says you should do everything: be on social, all the social channels, be on email, be on YouTube, do all of it.

The reality is that as a business owner, when you’re trying to get things off the ground — or even when you’re trying to scale — you very rarely do that while running ten different marketing channels. What generally works for most businesses is to pick one and really stick with it. Really narrow it down and say, “Okay, we’re great at paid ads. Let’s just focus on that.” Let’s nail it down, make sure we can get leads at a reasonable price, improve our conversion rate, improve how we work with the clients we get on the phone.

Mads Singers (02:39)

To scale to a pretty significant level, for most agencies it’s really about picking the one thing that works really well. The next part is looking at the people game. There are a lot of agencies out there with a lot of good stuff, but you need to make sure your structure is clear, and that you have leaders in place who aren’t just task managers but actual people managers — who can get the most out of your team and consistently help grow and improve the processes around you.

Mads Singers (03:16)

In many companies you have these task managers who do exactly what they’re told, but they’re not able to anticipate difficulty. They’re not able to deal with things they don’t expect. And as a business owner, you end up jumping in and fixing all the problems. You don’t want to be in that situation.

Mads Singers (03:37)

So that’s often the starting point: make sure you have the right people on the bus, make sure you have the right processes to execute, and understand that the bottleneck is going to move around the business depending on where you are in the cycle.

Mads Singers (03:52)

When you go through that, it really just becomes a question of addressing the bottleneck at that point in time. If the bottleneck is sales, what do you need to do as a business owner to grow and improve it? Do you need to hire more staff? Do you need to improve the conversion rate? It doesn’t need to be you doing it, but what is your focus getting done? Many times, if it’s processes that need to be executed, you want someone else being responsible both for doing it and for the outcome.

Sasha Damon (04:23)

What are the most common challenges agencies face when they’re trying to scale their business?

Mads Singers (04:34)

The number one thing I see is that they haven’t nailed down their process. The number of agencies that would collapse in a month or two if the owner disappeared is scary. So many agencies haven’t got a repeatable process — they’re always depending on the owner to set up the strategy for new clients, or the owner doing certain parts. And it’s usually because the agency hasn’t been set up in a good way, with a clear, scalable, repeatable process. That’s number one.

The second thing is definitely delegation. Everyone kind of has the idea that they should delegate, but they don’t have the right mindset around it. When I’m doing management consulting and coaching with leaders, that’s probably the biggest area where so many of them really struggle.

Mads Singers (05:26)

They keep holding the company back by not delegating. They think, “I’m a perfectionist, I want it done right, therefore I do it.” But they don’t realize they’re the reason the company is being held back — and the reason the staff are being held back and not growing. Because they’re holding back the growth of the staff, the staff will never grow. They’ll never get good enough. That’s a very vicious cycle. Those are some of the key things I see consistently being an issue.

Sasha Damon (05:53)

You touched on having processes and systems. When is the right time for an agency to start building processes and systems to support that growth?

Mads Singers (06:07)

I’d say when you’ve identified your ideal process — because what tends to happen is you figure out what it is you deliver. Let’s say you work just with people who want to be on Pinterest, so you focus on Pinterest.

Mads Singers (06:24)

Basically your goal is that every time you have a new client, if they don’t have a Pinterest account you set it up for them, and then you go through the process of generating good-quality pins or good-quality content for them. And you really want to document that process as much as you can — because if you’re the only one, as the owner, who can do it, you haven’t got a business.

Mads Singers (06:47)

A lot of the time owners struggle to explain what they’re doing, but it’s often because they’ve never had to. So the best challenge to go through is to treat it as though there’s no option. If I say, “I have something that needs to be done and you’re the only one available to do it, Sasha,” then I’m going to sit down and really try to document everything I do.

Mads Singers (07:11)

What I say is: document it all. First of all, when you’re doing that, you notice what you’re missing. But when you actually start thinking about what it is you’re looking at, sometimes you start asking yourself questions — “Could this be done more simply? Do we really need to do all of these checks?”

Mads Singers (07:31)

Very often, when you start documenting a process and breaking down what you’re looking at and how, what fundamentally happens is you actually become better. When you’re consciously documenting different pieces of a process — or getting someone in your team to do it — you can review it and say, “Wait a minute, why are we doing these seven steps? Could it be four?” And then you can also start looking at measurements.

Mads Singers (07:58)

So if you have a seven-step process to figure out the ideal pins, let’s say you test removing the three steps you think are least important, and then you look at the actual outcome.

Mads Singers (08:16)

Let’s say you get 95% of the same benefit by removing three of the seven steps. You might think, “Wait a minute — I’m doing all these complicated steps. It makes me feel good because it makes me think I’m really smart.”

Mads Singers (08:28)

But actually the overall impact is minimal. The benefit to the customer of doing seven steps is very small compared to doing four. And if we do four, we can do almost twice the amount of work. We can actually do more work for the client and get them more results, because we can get them more pins in significantly less time.

Mads Singers (08:51)

Generally, documentation is rarely a bad thing — even for myself. Even taking a blank piece of paper and just working through it: okay, what’s going to happen, what’s the routine, what’s the rhythm of it? Just looking through it can be mega helpful.

Sasha Damon (09:05)

That’s very insightful. You also touched on agency owners having to delegate, because if they don’t commit to that they might be holding themselves back. So how can an agency owner delegate more without losing control over quality and client relationships?

Mads Singers (09:28)

The core thing to understand is what business success actually takes. Most people think everything needs to be done perfectly for a business to succeed, and I’ll tell you that’s not the case. Some of the people I know who have built the biggest businesses grow really big companies at speed.

Mads Singers (09:51)

Fundamentally, when you’re looking at delegation, what you have to think about is this: if you’re doing something that someone paid less than you could be doing, you are fundamentally wasting company resources. You put yourself in a situation where your desire to do things is more important than the growth of the company.

Mads Singers (10:17)

And here’s the thing — you can do that. As a company owner you can do whatever you want. But be consciously aware of it: “I am purposefully making a lot less money than I could, because I choose to do these things instead of getting other people to do them.” As long as you’re consciously aware of that, fine. The goal for every business is not to be a $200 million business.

Mads Singers (10:44)

Every single business owner I’ve ever met has the same thing in common: at one point, someone somewhere trusted them. Someone gave them an amount of responsibility and said, “I don’t know how to do this — can you figure it out?” Or maybe, as an entrepreneur, someone gave you the first amount of money and said, “You seem like you know what you’re doing. Can you take this money and do something for me?”

Mads Singers (11:14)

When someone gives you the opportunity, when someone gives you trust and ownership to deliver a result, humans grow. The biggest issue with most company owners is that they’re thriving because someone somewhere trusted them and gave them ownership and responsibility — but they don’t give the same thing to their team.

Mads Singers (11:39)

Imagine if whoever it was hadn’t given you that ownership, hadn’t given you the responsibility, hadn’t let you blossom and become amazing at what you do. If that had never happened, you would potentially still be a regular employee. So if you don’t want your team to be regular employees, the way to do it is to empower them: give them ownership, give them responsibility, give them goals or things you’re trying to achieve, and let them go for it.

Mads Singers (12:08)

As a business owner, what you have to think about is: what’s the most important thing I can do right now that will move my business forward? And it’s very rarely answering a customer service email. It’s often the higher-level stuff — looking into ways other things could be done, looking into process optimization, looking into acquiring more customers.

Mads Singers (12:36)

If you focus on the things your business really needs, you will grow the business much faster. The rest of it, you delegate. So if you see, “Wait a minute, we’re getting no leads,” then: “I’m going to spend the next three months frantically focused on getting more leads into this business. I’m going to sit down, I’m going to do a bunch of videos” — whatever you think is a good direction. Everything else in the business, I let the team handle.

Mads Singers (13:05)

I promise you, your team will grow. Will they make mistakes? Of course. Here’s the thing — I make mistakes all the time. Will they make more mistakes than me? Possibly. But they learn from it and they grow. I own multiple businesses now, and I have many people in my teams who are significantly better at their area of expertise than I am today. That’s because I’ve let them become that. I’ve given them the ownership and responsibility.

Mads Singers (13:34)

I don’t want to be the best. I want to be good at managing people, and good at helping people get to the right outcome. If you think the way you create a successful business is to figure out what all your staff should be doing, you’re doing the wrong thing.

Sasha Damon (13:52)

What about key performance indicators?

Mads Singers (13:55)

The real question is: what are the numbers that matter to you? That will change from company to company, but typically you’re looking at the big three or four areas — how many leads are we bringing in, how many are we closing, how much money are we making in sales, and how are we doing in delivery? Depending on what you deliver and what you sell, those numbers might be broken down a bit more.

Mads Singers (14:19)

But at a high level, those are the things you want to understand. For example, at my recruitment company, Aristo Sourcing, the things we look at most are: how much money is coming in, how many leads are we generating consistently and through what sources, and fulfilment. So how long does it take us to fulfil a role, and what is the quality of that fulfilment?

Mads Singers (14:47)

When we fulfil a role, what percentage of people become a success? For us, that means they stay employed with the client long term. Depending on your business it might be slightly different things, but think about what the most important aspect is. Some of the recruitment competitors we have just look at how many placements they make, and that’s good enough for them. For us, we want to make sure our quality is extremely high.

Mads Singers (15:15)

When we place a person with our clients, the higher our level of success, the more likely the client comes back, the more likely we get referrals, and the more likely they are to say good things about us. For me that’s one of the most important numbers, because if we do a fantastic job every time we recruit, we’re going to have a lot of happy customers — and that makes sales and marketing so much easier.

Sasha Damon (15:44)

An agency might think there are too many risks in scaling at the moment, because of the current economic environment. So is scaling actually the right goal for every agency, or can trying to grow too quickly destroy a successful business?

Mads Singers (16:02)

The real question to ask when it comes to scaling is: what are you trying to achieve?

Mads Singers (16:10)

Honestly, most people don’t know. If I ask most people what their goal is, they say, “To make a lot of money.” And I say, “What’s a lot of money to you? Is it a million dollars? Ten million? A hundred million?” Depending on the answer, the reply to what you should do will be very different — because most people don’t really comprehend money.

Mads Singers (16:39)

Most people I talk to say, “To take care of myself and my family for the rest of my life, I need to make at least ten million dollars.” For most people that’s just an arbitrary number in their head. They haven’t actually sat down and worked it out. Let’s say you have $10 million in the bank. If you invest it relatively wisely and get a 10% return every year, that means you make a million dollars every single year.

Mads Singers (17:10)

That’s about $80,000 a month. Most people don’t need $80,000 a month. Most people don’t need anywhere near that to live a decent life. Are there people who want an extraordinary life and want that? For sure. But so many people — particularly people who’ve been thinking about selling their business — I’ve had some good conversations with, and we’ve figured out what the actual number is.

Mads Singers (17:35)

A good friend of mine was about to sell a business for eight million dollars, and he realized his actual number was three. Anything above three million dollars and he’s exceptionally happy. But he had never sat down and done the calculation. He’d never looked at the numbers — they were just arbitrary. When that’s the case, I recommend sitting down and doing the math.

Mads Singers (17:57)

Figure out, based on the math, what you’re actually trying to achieve. From there you can work out the rest. If you’re trying to build a hundred-million-dollar business, you’re not going to do it alone — everything else being equal, in most cases you’ll go significantly faster from zero to a hundred million with a significant team. But if your goal is to make five grand a month and just take care of yourself, you probably don’t need a team.

Sasha Damon (18:24)

That was really great. Thank you for your time.

Mads Singers (18:27)

Pleasure.