An agency founder explains why he prefers running an agency to building SaaS: agencies have better cash flow, let you sell talent at a markup, and let you test marketing tactics on your own business first. He scales to $100-150k monthly contracts and argues agencies are a faster path to wealth than the traditional SaaS grind.
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Another reason from the fact that running an agency makes you very liquid. Liquidities are basically having cash on notice which could be spent to invest more in your business or in yourself. An agency has another real reason that makes me fall in love with them over and over again. And by the way, the liquidity stuff, talking about like a SaaS, let's say, yeah, you're going to sell that SaaS one day or you might even have stocks. But yet like getting these stocks back and getting paper for these stocks can sometimes be quite challenge. Some of these founders, they are on paper worth billions of dollars, but they don't even have $200 in their bank accounts. So you know, they struggle for quite some years and you know, they're these billionaires, but they're really frugal because in reality they're not liquid and you don't have cash to do much and they're not free as a result. So basically they're sacrificing key years of their lives, facing the stress to one day be super hyper liquid, which obviously brings other challenge. From being illiquid to super liquid in like a matter of hours. Makes your life very weird to say the least. But that's just another topic. This video is mostly to tell you about this reason that makes me love agencies. And that reason is that every time that you run an agency, you're basically offering services, your expertise, you may save time and energy to someone that would buy your services. Basically arbitrage, right? So I hire top talents and I sell what they deliver for a higher price and I can package these top talents together. So someone that would have to pay, I don't know, 5, 10k per month to have an SDR team can now pay me 2k per month. And I will produce the same results, if not better. And I will avoid them the time and energy headaches and so forth. And what I want to get here, because I'm turning around the pot, is that an agency. Basically I'm starting a bunch of things myself as an agency, as a brand, I'll be starting some TikTok ads, for example, I'll be starting some remarketing ads. And the beauty about an agency is that once you master these services on yourself, the whole structure is already there so that you can offer this service to other people. And when you offer a service to other people, you get more expertise and the whole bunch gets better, including your own ads. So what I'm saying here is that basically I'm constantly launching these new marketing initiatives in my own companies for Example, remarketing ads that I've been doing on YouTube now that they're doing super well and I'm getting a bunch of eyeballs, I'm getting people to believe in me and my brand and increase their closing rate, I'm going to offer this service in my existing package to my clients. So now people that have been doing cold email for they will also have these remarketing ads. So people, if they click a link in the cold email they will be redirected to a website, if they're being redirected to a website that they can fire the pixel if the pixel fired. And next time they go on YouTube they will see my clients YouTube ads. And that's beautiful. That means that my clients will get more clients, I will get paid more and I will get better at doing these things and I can package things up, you know, until I reach a point in time in which I can charge 100, 150k per month and so forth. So apart from the theory that agencies can also produce these amazing business ideas, they can help evaluate some business models. For example, I know that TikTok agencies right now are all the rage and they're working super well. They can also allow you to deploy more services, get paid more and get better. So it's like this never ending loop. And no, software as a service won't allow you to do that. SaaS is, you focus on this product, it's direct to consumer most of the time or direct to B2B and you don't offer these services really to your clients. You know, it's like let's focus on our software. And this is one thing out of many that, so I think it's important that not only an agency allows you to get paid, it allows you to learn, but eventually by trying so many things, so many industries, so many business models, so many marketing tactics that one day you will find probably one or two or three of these and then yes, you can deploy an official company with, with these new acquired mental models and that can allow you to reach the unicorn status pretty quickly. And that idea came as I was reading yesterday, some B2B SaaS owners that have exited for like a payout of 3 million. Fuck man. Like did you really spend 7 years of your life to build something that you're Gonna exit at 4 million? Is, is that it? You know, and they're burnt out, they're burned the fuck out, you know, and they went the traditional route. And by the way, that's the outcome of most startups out there. It's just that we see these snaps, we see these Airbnbs and we freak the fuck out and we think we're gonna get billion dollar exits. You know, I suggest a more sustainable path, which is starting an AGENC portfolio of company, selling some of these portfolio, but like not going all in in a model that you don't really know if it's going to scale or if it's the right one. And obviously this gets complex really quickly. What I'm saying is that an agency allows you to get richer, allows you to gain more knowledge. You can deploy what you're good at with yourself, and with that, eventually you can have a shot at major success.
