90% of startups don’t make it past year three.
What does it take to defy the odds and be part of that select 10%? Well, a lot of things. Market fit, creating something people really need and building the right team are just a few of them.
This October, Idunn, the digital marketing agency I run, turned three. I made it past the first hurdle.
This doesn’t mean that it’s all been a great ride, though.
The anniversary was a great time for me to sit down and reflect on what I did right and, most importantly, on what I did wrong.
A friend once told me that the smartest people learn from others’ mistakes. Here are mine – happy learning!
Know those gurus that tell you that you don’t need to hustle so hard? That it’s all in the mindset? That sheer will power will turn you into a billionaire?
Sorry to say, but there are not real shortcuts to building a successful business.
Whenever I hear someone tell me how lucky I am, I feel a strong need to punch them. Yes, I am my own boss. Yes, I can work whenever I want and from wherever.
But this doesn’t mean that it all fell into my lap. It means that I worked hard for all of it. No luck involved.
In a 9 to 5 job, you know exactly when you clock out. When you are a beginner entrepreneur you never do.
One last harsh truth here – working from a stunning beach it’s not all it’s cracked up to be, trust me!
However right your mindset is, you still have to put in the (long) hours. Otherwise, you may have a good run for a few months and then have to close up shop completely.
In fact, you should do it.
My story is quite a common one: I started out as a freelancer and expanded into a business when I couldn’t handle all the work on my own. The only problem: I continued to act as a freelancer even after building a company.
I did most of the work myself. Sales, client service, strategy and client work – from social media to copywriting and clients’ strategies, I was a mean (tired) machine.
Mistakes were made. Tiny ones, like typos in our content, but also really big ones. I’m talking about missing huge opportunities. And even about stupid snafus like working extra hard on a client’s strategy only to forget to send the (rather big) invoice for it.
One of the defining traits of entrepreneurs or solopreneurs is loneliness, especially if you run a remote team like I do. The need for human interaction aside, making all the decisions on your own and not having anyone to bounce ideas off of can cripple your drive and your business along with it.
So be smarter than I was in my early days. Hire people. Get a team that shares your values. Let them in. Ask for their opinions on anything. They will surprise you.
Burnout syndrome is real.
Don’t let yourself get there. Don’t spread yourself too thin. Hire talented people to help you and outsource things like copywriting/content writing or graphic design. Odds are professionals will do a better job than you, the entrepreneur who already has a million other things on their mind.
At the end of 2017, my company had a 70% year-over-year growth. The 2017 profits alone were enough for me to live comfortably for at least four years with no other income.
A 70% year-over-year growth sounds like a dream come true, right?
Well, it can be. But to me this realization was bittersweet.
When I checked my bank account, I smiled. Who doesn’t like money?
I had plenty of it. What I didn’t have was the will to go on the same way. So this year, I stumped my own agency’s growth.
Before you declare me mad, hear me out.
You see, our tagline is “boutique approach, grand results”. Our growth spur took a bit from both.
I never wanted to turn Idunn into a multi-million business. I wanted (and still do) to run a boutique agency that gives enough time and attention to each and every client.
We don’t churn out millions of words in articles and web content each month, like your average content mill does. We rarely work with more than 15-20 clients in a month. Our writers are handpicked by me and trained continuously. They don’t have impossible daily writing quotas. They write as much as they feel comfortable with because quality comes first, not quantity.
Sadly, because I was living under the spell of the common mantra “grow or die”, I lost sight of all of the above.
Growth without scalability is dangerous.
My business model was no longer sustainable.
Something had to change. It took me a while to realize what and when to do it.
At the end of the first quarter of 2018, it finally happened. I fired two of our writers and two of our highest-paying customers.
In other words: I willingly let go of 30% of my agency’s monthly revenue.
Why, you ask?
Simply put, because they weren’t a good fit for my agency. What they needed was a content mill who spins cheap articles according to pre-defined specs. There was no point in overpaying us for menial work that made my team miserable. We parted amicably and I recommended other agencies for them.
I let them go because we needed to regain our focus. Because we were stretched too thin, the quality of our work had begun to diminish. We were moving further and further away from our initial mission.
While our cash flow took a hit for two months, in Q3 we were back on track. Our yearly projections look at least as good as those of 2017. Most importantly, we are also 100% faithful to our mission (again).
This may sound harsh, but it’s the best lesson I learned in these three years.
In your first years of entrepreneurship, you pour your heart into making each and every client happy. And that’s great! But only as long as those clients are the right fit for your business.
When you invest time and money in your own business, your clients will also reap the benefits. In a way, it’s like saying a child can’t be happy if his parents are miserable.
Your clients can’t be happy when their partner is a business that’s struggling.
Whenever I dropped the ball on promoting Idunn, we ended up onboarding clients that weren’t a good fit for us. And you should never try to make the wrong client happy. This battle is lost from the get-go.
I’m not an idealist. I’m not saying that you should only work for clients you absolutely love. Ideals don’t pay the bills, nor the staff. But you shouldn’t kill yourself over making everyone happy, either. Not everyone matters.
So take the time and the money to invest in your business. One of the most liberating feelings an entrepreneur can have comes from the ability to turn clients down or fire them in order to make room for better clients – whatever your definition of better clients may be.
And while you’re at it, make sure you invest in yourself, too. A burnt-out entrepreneur is never a successful entrepreneur. Go out, set time aside for family and friends and indulge yourself. A massage, a yoga session, even a wine tasting or an extravagant trip are never wasted money. They are an investment in yourself.
Out of all the brands I worked with (and I worked with more than 300 of them so far), the ones that “made it” were those that stayed true to their mission. The ones that understood that the value of $10 in a month is greater than the value of $5 right now, irrespective of what “growth hackers” whisper in your ear.
It’s been three years of struggles, failures, but also great successes. I’m really proud to be able to market Idunn as an agency that grows sustainably through the tactics it promotes: excellent content writing and great social media marketing – our two main lead generation sources.
I’m also proud to say we managed to steer back to our core values and hold ourselves to the same standard we market. I know making it to three years doesn’t ensure smooth sailing from now on. But I also know I’m better equipped to handle new challenges.
If I were to offer a single piece of advice to entrepreneurs who are just starting up is “don’t give up on your values”. You can (and you should!) adapt and improve constantly. But be sure you still grok the mission you started with. Write it down in front of your desk, if you must.