3 Growth Paths for Coaching Businesses

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Good evening. I'm Katie McManus, business strategist and money mindset coach to ADHD business owners. Welcome. Hello. Rest and relax, Boston and Jessica. Hello. It's been a long time and welcome. Just a little housekeeping. I am going live to Instagram, to the Facebooks, to LinkedIn, to YouTube and also like Twitter X whatever the it is these days. Anyway, going live today on a topic that has been extremely relevant to some potential clients that I've spoken to. And it's this idea of, okay, you've started a coaching business, great. You love it, you love the work. Super exciting. What's next though, right? Because here's the thing, you know, if you have, if you have ambition, you know, working for yourself as a solopreneur often isn't enough, right? There's often like a new goal, a new benchmark for success and it could be financial, it could be impact driven, but there's usually something more than what you're doing right now. Now. Sorry, I'm having hiccups. I just had dinner. Excuse me. Anyway, so there are a few different models. I mean, there are lots of different ways that you could expand your business. I want to talk through the three that are the most considered and I want to go through what the pros and cons are. Right. The most common of these is the digital. And the agency franchise is also an option. Now I want to go through before we get into the pros and cons, I want to go into what people think it's going to be like and what it's actually like. Okay. Because there is a big disconnect between like what the actual day to day is going to be and it's because we don't see it out there. Like there's no one who is running a coaching agency who's like saying, hey, everyone, like, here's behind the scenes how I'm doing this and this is how you make this super easy and here's how you do it hard. There are a bunch of people out there on, you know, by contrast, teaching you how to do a digital course. And that can be. I know, welcome. That can be extremely overwhelming because there are all these voices. They're all telling you a bunch of, a bunch of stuff. And it could be the same or it could be different. Who do you listen to? Right? And then of course, the franchise certification model, you Know, that's something that we really don't see broadcast as openly. There are some things, some businesses out there that do this well, there are some businesses out there that do this really crappily. I'm going to be talking through those. Let's start off with the agency model. Okay, so the agency model, let's talk about what that looks like, right? So you are a coach. And let's, let's, for the sake of this experiment or this example, let's talk about you as if you are a leadership coach. Okay? So you do executive leadership coaching and training and you have a lot of B2B clients, right? So the benefits of starting an agency is that like you can take on more clients, right? Because if you're working with a company who has say like 15 senior executives, you cannot go and coach all of them. Okay. First and foremost there would be a conflict of interest because, you know, oftentimes you're coaching them how to deal with each other and you don't want the triangulation. And then also like, you know, you probably have other clients. Hopefully you don't want all your eggs in one basket. So having a few other people that you can farm that work out to is going to be really beneficial. Now a lot of folks think when they start an agency that it's going to be easy, that they're going to be able to establish their book of business, they're going to be able to hire people and it's just going to like roll right in. Starting an agency is one of the hardest things you're ever going to do. Okay? I haven't done it and I'm not going to do it. Okay. Because it's one of the hardest things you would ever do. Okay? So I want you to think about this, you as a solo person. Hi, Jason. Hi. Hi John. Welcome and happy day after your birthday, John, I'm going to call you out to everyone. So as a solo coach, you are responsible for delivering coaching, for doing any training programs that you offered, for doing lead generation, for selling, for doing all the back end stuff. Maybe you outsource some stuff to an OBM or a bookkeeper, but you're really responsible for everything and for doing everything. Right. When you take the agency model, what ends up happening is you add to that list and you only take away chunks of it, right? So you are adding in managing other coaches, you know, making sure that they are adhering to whatever framework you have set up, doing any training that's required there you are also, because you are not going to be the coach for some of your contracts. You're now the account manager. Right. Which adds a whole bunch of responsibilities. Right. You're wanting to make sure that the client, the business is happy, but you're also wanting to make sure that the actual coaching client is happy. They're two different relationships. Okay. You know, oftentimes people think that when they start an agency that it's going to be easy. They'll just be able to add people in, you know, and magically the business will get work and they'll be able to take a cut of what other people are charging. And it's just going to be like an awesome, really easy way to grow the business. And actually there's a lot more challenges to it because you have to be the person who's going out and getting the business. Right. The benefit for those other coaches to enter your business and do work for you and give you a cut of what they're earning is that you are providing them with clients. Okay. So you have to have a constant deal flow coming. You also have to market yourself. You have to market the business. Right? So you have to be doing the sales and marketing hardcore. And depending on how big the business is, like, you may be able to outsource this, but only if the business is at a certain size. Right. Because if you only have like three to four coaches, that's not going to be enough potential sales for a salesperson to come in and make a full time income. Jason, sounds like a lot of faff. Not sure what faff is, but on a monopoetically, I agree. I think that's how you pronounce that word. I learned that from West Wing, by the way. That's one of my favorite TV shows. If you haven't seen it, it's brilliant. Anyway, onomono poetically means it sounds like. Sounds like. Yes, sounds like riff raff. A lot of flim flam. Yes, yes, yes, yes, exactly. Yeah. It's a lot of work. And here's the thing. Usually someone starts coaching because they love coaching, right? You start coaching because you're so passionate about being able to help people. And yes, through an agency, you can absolutely ensure that you're helping more people, but you're likely not going to be the one doing more of the helping. You're likely to do more of the business managing than anything else right now. The agency model can absolutely work if you want to grow this agency and you can get things off of your plate if you grow the agency to be, you know, 10, 1530 people. But remember, the bigger your team grows, the more management it requires, right? And so it's really, it's up to you. But I don't want anyone starting a coaching business thinking they're going to take it to the agency model, thinking that this is going to be easy because it is incredibly challenging. Hi, Edvin. Welcome. So some of the pros of starting the agency is you don't have to serve everyone, right? You have a lot more capacity to help more people and less conflicts of interest. If you're working within a business, you can have more of a diverse offering also, you know, like, maybe you have a specialty in your coaching. You can bring in coaches with other specialties. You could also bring in facilitators. You could bring in trainers. You could bring in a whole bunch of other people and offer whatever it is that they provide as services. If you do do that, the challenge then becomes it's their service. You know, you have to make sure that there's something that you provide them that they can't get on their own, right? And, like, what happens if they leave the business? What happens if they leave the agency? You need to be able to document exactly how they do their thing, exactly how they provide stuff, because you don't want there to be any bait and switch for your client. Jason Love, West Wing. Such a great show. So you want to really, really be conscious of who you're bringing in and what skills they bring to the table and whether or not those skills can be replaced if they choose to move on. All right? Because, you know, let's be real. People's priorities change. Maybe it won't be a good fit, but you need to be able to offer a consistent service to the client. You know, the other thing is you're able to take those bigger. Those bigger contracts, right? You're able to serve bigger clients, which means a lot more money, but there's also a lot more risk, right? Because if you have bigger clients and your whole business is built around that income coming in from those main primary clients, what happens if they go out of business? Or what happens if they need to renegotiate or someone changes, you know, directorship and they have to reorganize and all of a sudden, like, there's no budget for working with you. Okay, you want to be very, very conscious of having multiple large clients. Let me see. Muhammad, thanks for sharing these strategies to help us make informed decisions and take our coaching business to new heights. Of course. Oh, Mahmoud. I'm sorry, I hope I pronounced your name Correctly. I was, I was just glancing on it while I was reading Mahmoud. That's how I'm, I'm pronouncing your name. And if I'm wrong, please correct me. Anyway, so you know, the cons of the agency model are really that your job and your responsibility becomes lead generation, right? Because the only reason coaches, facilitators, trainers, whoever, have a reason to come and work for you is because you are guaranteeing work so that they don't have to go and drum it up themselves. Okay, you need to have that dialed in before or you have an agency model. I had a client a few years ago who was trying really hard to build this into her business and she did not have any desire to do lead gen for the business. And it was something that, like, there was just no moving forward for her if she wanted to have, you know, feed businesses, coaches that she'd brought in and contracted with because she wasn't bringing in any clients for herself and she wasn't willing to do any of the work to make sure that she was even getting leads, much less other people. Right? So you have to be really dedicated and willing to put yourself out there and really do this. It also really helps if you have a separate brand to yourself, right? Because if you do have to hand sales off to someone else, it's a lot easier for them to do their job if, like people aren't getting on the phone expecting to speak to you. Jason, surely there has to be a critical mass of coaching numbers. For example, 2 to 8 doesn't work command commercially, so it's 10+. But then you go from nothing to everything at lightning speed to make the costs work. You know, it's yes, yes, yes, yes, yes, yes. I'm just going to agree with you. It's, you know, growing a coaching business to an agency model is really tricky because there's a lot of risk for everyone, right? You have to, I mean a, you could absolutely invest in like an ad strategy and go and do a crap ton of lead generation and sell these contracts. But then you have to find a coach to fulfill on the contracts, right? You have to have those in your back pocket. Or you could create partnerships with coaches and say, hey, listen, like I would like to hire you 1099. So they're a contractor for the business. I will feed you, you know, clients, you know, at a slow pace. And then as you build it up, then you add more people. And then of course, like if you are lucky enough to be able to have investors or if you have if you've made enough money up until this point that you can actually hire someone full time, that's an option as well. All of them have, obviously, pros and cons, because, like, here's the thing, you know, if you bring someone in and you're doing the whole, okay, well, I'm gonna. I'm gonna kick you a client here, there, and, you know, we'll just build up over time. You know, you have to count on them being patient and wanting to stick around for more clients. You also run the risk that they may fill up the rest of their client list while you're trying to find clients for them. So, I mean, it's. It's really tricky. It's really tricky. It's a balancing act. And I think a lot of people think that they want to run an agency and they don't realize just how much goes into it. Jason Fast. So consider. Collaborate until it stacks up and then move to agency. This isn't for me. Just curious. Yeah, I mean, it really depends on your comfort level with risk. Right? So, like, if you have a high comfort level with risk and you're willing to just jump all in, you know, everything's available to you, otherwise. Yes. You want to create those partnerships and you want to just build them over time. And it's really helpful to have partnerships with multiple different coaches. Right? So, like, if you had three people that you were farming workout to, that would be really helpful. Let me see. You know, one of the major cons of the agency model is that you really have to manage people. And that may not sound terrible, because usually people who are doing, like, leadership development and coaching and executive coaching, you know, they've been managers before. They've led people. Right, but you're not just leading other people. You're leading leadership coaches and executive coaches. Okay. It's kind of like. Like the therapist of the therapist. You know, there can be certain complications and, you know, certain levels of disquiet. I don't want to say conflict, but just quiet. That can happen on a team where everyone's, like, operating at that level, you know, so just keep that in mind. The other thing that you want to be very conscious of, especially with this and the franchise option, are your contracts. Okay? Partnerships, Contracts, like, they can get real squirrely real fast. Want to remind you, if you're doing a partnership with anyone, no one enters into a partnership with someone they don't like and trust, okay? That's something I learned from my friend David Fryman. No one does that. And yet partnerships Go south all the time. And, you know, it's something that you want to have all the contracts in order to. You also want to have all of the here's how we're going to break up language figured out before you even get started. And I know it feels like you're planning for failure, but you're not. Like, there may become a point, like, when two people get married, the point of getting married is to stay married forever until you die. Right? Businesses are not that way. Like, no one enters into a business agreement thinking this is until death do us part. There will be a moment where one or both of you want to exit the business. What is that moment? And what are the different modalities that you can exit the business? And how are you going to lay that out up front? Right. Also, like, if you are doing the agency model and you're bringing coaches in, you want to be very conscious of how much money you are paying them and how you are managing that across different coaches. I'm a huge advocate for having consistent pay structures. Right? Because the worst thing that can happen is you negotiate one deal with this person, another deal with this person, another deal with this person. And I'm all for, you know, everyone being transparent about how much they're being paid, but how shitty would that be for the person who's getting paid the least to hear that these other two people are getting paid more? And then on your side, like, you may be happy to pay them more, but you might have done the math on what you can afford exciting expenses wise in your business based on them not making that much. Okay, you want to figure all this stuff out beforehand. Okay, moving on, because we're already like 18 minutes and I've only covered one. I'm gonna drink more water. Do you guys have any questions for those of you who are in the comments and watching? Okay. All right. The second model, this is one that I have not seen talked about much in, like, open circles. I'm really excited to talk about it. This is the franchise certification model. Okay, so let's just make up. You are a coach. You train on leadership and development or leadership and executive training, whatever it is, and say you have put together your own little model of doing leadership training. All right, now you, as. As one person can absolutely go and train a ton of people. You can do coaching, but there's a limit to how much you can do, right? So if you wanted to scale and expand your reach and your business with this kind of model, basically what you would do is create this business. That is separate from yourself. And you would establish just like very, very precise standard operating procedures for marketing. For client acquisition. You would come up with a model that you could train people on and certify them on. An agency or a company that does this pretty well is eos Entrepreneurial Operating Systems. They are a franchise, right? So people I think have to pay anywhere from like 353200 to 142,000. I was stalking their website because I was trying to, you know, know piece together what they offer to get set up as the franchise. And then I think you have to pay like 1200amonth to be part of the franchise. But they give you everything. It's kind of like a business in a box. Now the pros of doing this are you have less responsibility, right? Because it's their business does have your name on it though. So you have to have really high standards and you have to communicate them and have all of that language baked into your contracts to make sure that they are, they are legally obligated to reach those standards. So you're less responsible. But that can also be a major con, right? Because if you're less responsible, if it's not your onus, you're not managing everything, there is the potential that you could end up chasing people either chasing people for money, chasing people down to fix things, chasing people down to, for, you know, not representing the brand well enough. So you will want to have extensive contracts that lay all of this out and also lay out what happens if they fail in any of these ways. The other thing about the franchise model that's kind of a pro and a con is that there is a ton of front loaded work, right? So you're gonna have to do a ton of work upfront to establish all this. And after it's kind of, it's kind of set you. I mean you're pretty good. Like that's amazing. You're gonna have to do updates as you go along, obviously. But like, it's kind of like I said it and forget it a little bit. Ish. You are still gonna have to sell it though. Like you now have multiple clients, right? You have your clients that you're serving through your coaching business and you have your clients who are the people who are buying the franchise from you. Okay? So you're now marketing in two different markets to two different groups and you're gonna have to figure out how to fulfill both. Right? There are some franchise models that also do lead gen for their people. That's an option as well. You can end up charging more for your franchise fee or have royalties if you're doing that. But not necessarily. It's up to you. It's a lot more passive, you know, like, you know, you can absolutely set people up with their franchise and have them kind of just run it in another area, in another market, whatever. Set, kind of set it and forget it. That's amazing. And the benefit here is that, like you, your brand is just going to grow. Your brand is going to grow because other people are growing your brand for you and it's benefiting them. Okay. It's not like you're doing this and it's unethical. You're doing this in a beautiful way that's benefiting them and benefiting all the clients you're able to serve through them because they're getting to access your model and your brain. Any questions on the franchise model? I realize I'm not actually sure how franchises work outside of the U.S. so if you're in a different country and you have a franchise model knowledge, I would love to hear about it. Lastly, you know, this is the one that we hear a lot about. You know, there are just so many courses out there teaching how to do a digital course, how to put all of your knowledge into a training program. I don't think I have to explain this too much because there's so much out there. You know, the pros to this, again, just like the franchise model is, there's a ton of upfront work right now. Unlike the franchise model, where you have other people kind of like keeping it alive for you, you are the person responsible for updating it. Right? Keeping it alive. So you're going to have to go through and update this, this content that you've put together. You're also. There's like a lot of technology management, right, because you're hosting it somewhere. You know, there's a lot of promotions that are required for this model as well, you know, and promoting maybe something that you're really passionate about, maybe something that you absolutely hate. Right? So you could. I'm getting a text message about something. Okay, I will get back to that. You know, but you're going to have to be in launch mode a lot, you know, because you want to fill it up and you want to fill it up, and you want to fill it up. You're also going to have spend. To spend money on ads, like, guaranteed. You're going to have to spend money on ads. There's. It's really, really hard to do this organically. But the beauty, the beautiful thing about doing a digital course is that you get to help so many people and you get to help them in a more direct way than if you're hiring other people or franchising it out to other people to help them. And those are the three top ones that I see discussed a lot. Now, if you have a coaching business or you have a consulting business, they're very similar in models and you are curious about growing it and you have another idea and you want to tease it out with me, I would love to hear what your idea is first and foremost and I'm happy to do my next live on it. So a little crowdsourcing of content. Want to just thank Jason and John and Nell and Jessica and Rest and Relax Boston, whose first name I don't actually know, and Edvin and Mahmoud for joining me tonight. I hope you found this super use and if you are growing a coaching business, I wish you so much luck. It is so exciting. It is one of the most fun things I have ever done in my life and I love helping my clients do this because it's so incredible to be able to make money by actually making the world a better place in some ways, you know, and it's not for the. The what is it? The make of heart. You really can't do this and be a weenie. You have to stop being a weenie and step into power here. Anyway, I'm Katie McManus, Business Strategist, Money mindset coach. I almost knocked over my water with my elbow. Thank you so much for joining me. I will be going live again tomorrow and I'm going live with Meredith Adams on Friday. So you will not want to miss that. We're going to be talking about storytelling to get clients. It's a very rich topic. Anyway, thank you all for joining. I hope you enjoyed and I will talk to you all soon. Bye.