Five Questions To Ask Before Opening A Digital Agency
Our parents tried to warn us, and as much as we hate to admit this, it sounds like they were right – all the jobs these days are “in computers”.
As unhelpful as that was, when most people hear their great-aunt talk about “computer jobs” they usually mean something like programming. However, a lot of entrepreneurs, marketers, and copywriters are finding success in the booming field of digital marketing these days, and with the continued growth of Google and all its related services, it doesn’t look like an industry that’s going anywhere anytime soon.
So maybe you want a piece of the action yourself. You’ve got a little grounding in SEO, you’ve got some ideas for a snappy name, and you’re ready to get out there and start making your clients some money – money that, hopefully, they’ll be willing to share with you after you send out some invoices.
Before you start buying domain names and preparing your Google Slides deck about conversion rates and proper linking, though, there’s a few less-glamorous business things you need to get out of the way first. Here’s five big questions you need to ask yourself – and have good answers for – before you start your own digital agency:
What services is my agency going to offer? This question is twofold. A lot of people dream of billing themselves as an all-in-one digital solution for web design, SEO, graphic design, and so on. While this plan is all well and good for the future, considering you haven’t even opened your business yet you’re going to be much better off focusing on the things you can offer right away. Do you yourself have an SEO or marketing background that you can leverage with early clients? Can you easily find a web design staff to handle that until you build up your clients and portfolio? Take both a short-term and long-term view of your services and plan from there. (If you need some help, there’s a lot of free business plans available online specifically for digital agencies from places like Digital Agency Network and Profitable Venture.)
Where are my early clients coming from? SEO and digital marketing enough are a big deal these days that a lot of business owners are aware of to some degree. Gone are the days where you could cold-call strangers in the phonebook; trying that now will just get you the sobering acknowledgement that you were the fifth person in a month to offer your SEO services, and anyway they “know someone that can do it” for free or cheap anyway. You’re going to want to learn to network – meet local business owners and offer to do one service that they have most lacking (local, paid, etc) and increase your portfolio from there. The bigger clients will come in time, but you’re never going to work with the huge retailers if you don’t tackle the local plumbers and law firms first.
Where is the money coming from? This is a question you’re going to have to ask yourself several times through the process. The temptation at first may be there to try and get into a partnership with a larger firm to get your feet off the ground that much faster, but this can lead to a lot of equity and share issues later – issues you might not want when you’re trying to establish your business as a sole entity. Even if you need to get a startup loan, the fact you’ll be the sole owner of your own business will be more than worth the effort when it comes to future revenue and stock options. These articles from NerdWallet, Credibly, and Fundera can point you in the right direction for finding startup funding sources.
When (and who) do I start hiring? A lot of you entrepreneur-types like to think you can totally go it alone, and while that might help keep costs down it can have some advantages and disadvantages in the early going. Depending on how well your networking went and how many clients you have right away, if there’s any money left in the budget you may want to hire an extra employee or two. Who this may be is entirely up to you – someone you’ve worked with in the past, a friend in the field who needs new challenges, etc. Just make sure you’re upfront with them about how much work it’s going to take, how long they may last in the position, and what your expectations are. Hiring is always awkward, but hiring for a startup tends to be doubly so.
Where are you planning to go? There’s a fine balance to this question. It’s fun to dream big, one day planning out your lavish Apple-style campus with company-mandated ball pits, but you also want to focus on the next few years. Take some time to sit down and really map out that old cliched friend of ours, the five-year-plan (this handy guide from Small Business Chron can help) and don’t be afraid to be flexible as you see what the next few years hold.
With these tips you should be off to a pretty good start. But after that, you’re on your own. Don’t look so nervous, you got this.