Matt Kohn is the Head of Growth at Different Hunger Media, a brand that helps freelancers build profitable and automated agencies. Matt got his start freelancing before building his own team and agency.
He came on for a LIVE! with Next Gen just this past week to teach us how to transition from freelancer to digital agency owner. For Matt, the biggest advantage of making the this transition is the lifestyle and financial freedom that comes with it. And as Matt shared, this transition doesn’t happen overnight.
Matt quit his desk job as a consultant on March 25th, 2016 and never looked back. It took him over a year to find his stride inside his business. His emphasis on building a business around his ideal work life balance was a huge catalyst for his growth.
He challenged the audience to ask themselves “What do you want your life to look like?” and then to go out and build a team and business that supports those goals. He recommended outsourcing work (ie. to assistants in the Philippines) in order to optimize both time and revenue as a business owner, ensure one’s life is more in alignment with the freedom they envision.
Freelancer to agency fundamentals.
He noted that the most important part of the shift from being just a freelancer to an ‘agency’ is the mindset shift. A big part of this shift is the desire to serve your clients on a much deeper level.
Instead of being the sole expert on staff like most freelancers, agencies are comprised of specialists in order to deliver better results for clients. It’s essential that you are excited about leading and managing a team if you choose to go the agency route.
Successful agencies require core offers built on monthly recurring revenue packages, not just one-off custom projects. This transition requires agencies to target specific clients instead of taking on anyone and everyone, like most freelancers do when they get started.
Lastly, don’t worry about the details. Matt insists that you don’t need an LLC, a logo, or even a website. You just need sales. Don’t lose precious time obsessing over the details. Instead, get on the phone and start closing deals. Matt told the group he didn’t even setup his LLC until his agency broke 6-figures in revenue!
Matt’s three steps to building a scalable, $10K+ per month agency:
Step Zero. – BEFORE any of the three steps, you must have a valuable skill set that people are willing to pay money for. Focus on using your skills to generate predictable ROI for your clients.
Step One. Define your unique positioning and core offer (at least $2,000 per month). Avoid becoming a “me-too” agency like everyone else re-selling the exact same products and services with a different name. That’s a race to the bottom and will prevent you from commanding premium prices for your service. For example, say that you do brand copywriting for scaling startups. Well, so do other agencies. How are you going to uniquely position and offer your skill set in a way that makes it clear to the client you are different and better than your competition?
Step Two. Get your lead generation and sales funnels rock solid. How are you going to fill your sales pipeline? What is your strategy? Cold calls? (We both cringed at this one). Posting in Facebook groups? Whatever it is, you need a clearly defined sales process that’s replicable month to month. If you don’t have this, you don’t have a business.
Step Three. You must DELIVER on your service and promise with perfect team execution and delivery. The best type of lead is a client you’ve already proven yourself to.
Critical elements to digital agency success
Focus on monthly recurring revenue instead of one-off projects. In the early days especially, cash flow is king. If you have to manage delivery while also refilling your pipeline every single day and week, you’re going to burn out fast….if you haven’t already. Monthly recurring revenue allows you to predictably grow which is invaluable in startup mode.
Monitor and spend your money systematically. When seeking to grow, there’s pressure to scale (outsourcing, hiring), but you run the risk of wasting a lot of money in the early stages. Make sure you have your system ironed out and set in stone before outsourcing, so you can saliently communicate your needs and processes to whoever you hire in the future.
Execute every single day. Matt shared that the common thread between successful agencies actually doesn’t have to do with talent, but hunger to achieve one’s goals. He noted that knowing your motivation, your “hunger ,” is critical. If your motivations in life are external, materialistic things such as expensive tropical vacations or Instagram followers, you’re less likely to be motivated. But, if your motivations include food on the table for your family and other deeply fulfilling things, you’re able to overcome obstacles and struggles on your journey. “When you chase and finally get those flashy things, you realize that they aren’t the most fulfilling things,” Matt concluded.
A big thank you to Matt for sharing how to transition from freelancer to 6+ figure agency owner. Want mentorship and training from Matt and his team that have helped thousands of freelancers and agencies? Click here to access the free training he’s put together for you.
The Next Gen Community LIVE! Series brings tactical advice and inspiring stories to the community in a conversation-like fashion, encouraging questions and engagement from the audience. LIVE’s! feature bestselling authors, renowned speakers, and well-seasoned industry experts every week on the Next Gen Summit Facebook page.