The Three Best Agency Models To Get To $10,000,000 Per Year

This video is going to be about the three best agency models to get to $10 million per year or more in revenue. In my opinion, after working with about 550 agency owners on a monthly basis, most just don't simply have the unit economics or business model to allow them to get to this much. And if you ask them, a lot of them actually do have a goal such as this to get to $10 million per year in revenue, maybe 30% profit margin or something like that, sell for a 3 to 5x and exit for over eight figures. So I'm going to go over it in this video. Regardless of the business model, you're probably going to need a funnel like we teach in the scale your agency program. I have 12 free trainings that'll be linked in the description on how to build this for yourself if you want to or I can help you inside my program. But we're going to need a lot of client acquisition regardless of the business model we choose. And this is the example of a great funnel. So if we go down, the three business models that we really can do are we're going to either have to have a factory approach, basically meaning we're going to have to have hundreds of clients at those 3, 5, 8, 10k per month retainers and just stack em up. This is what I did at my previous agency that I exited. The second is going to be an ultra high ticket where basically we just have a few clients but we're charging them a hundred K, 250K, 500K, a million dollars per year or more. And the final one is going to be performance only, whether that's pay per lead or a growth partner type model where you get profit share or whatever. But these are the really the only three models that we can do. If you have a lot of people in their current form, they'll have kind of bits and pieces of these three models, but they don't really work when you mix them. For example, they might have one or two clients that have a performance. You know, maybe they get a percentage of ad spend or they get a performance bonus or whatever. Or they'll try to have a factory approach that have multiple clients but a lot of them will have custom work, different services, all that kind of stuff. Or they have one big high ticket client and the rest are kind of small. Mixing these things doesn't really work in a way that's going to get you to $10 million a year or more. So let's go through the pros and cons of all of them. So the factory approach really is like you are getting, you know, 500. Oops, let's get that stroke width a little bit. You're getting, you know, 5k per month clients times, let me do the math here, you know, 5k per month clients. So let's go 10 million per year divided by 5,000 divided by 12. You're really getting like 5k times 166 clients times 12 months is going to be that 10 mil per year mark. And this is actually a very good business model. Assuming a few things. With this, you're going to have to have a productized offer or at least a very set offer that you know, your, all of your processes, all of your SOPs, all of your tools, all of your training is, is all basically designed and revolves around this core service. And you're basically just going to need to stack them up. You know, you're going to be scaling up your paid ads, your outreach, your appointment setters, your content, your partnerships, and you're just going to be able to get this many clients. When you take into account the amount of churn that some people have, when you take into account the kind of poor quality service that a lot of people have and the fact that they just don't have the capacity to generate this many clients, it really doesn't work a lot for them. The typical things that you're going to need are basically a 10% monthly churn or less is kind of the max. If you want this to work, you're going to be needing to generate maybe about 10 qualified leads per day and closing them at a 20% type thing. And if you can't do those, and those are just kind of general guidelines, and you're going to have to have a service that basically gets results for 75% of people or more in the agency game, you're never going to be perfect all the time because there are a lot of factors that are out of your control. But a lot of people will get results for their clients. 30%, 40%, 50% of the time. It's just not going to work in this model. So if you think you can't get less than 10% monthly churn or you're not even tracking your churn at this point, so you don't even know or you don't think you can generate 10 qualified leads per day, whether that's your own skill set or whether that your market's too small and you know that 75% of your clients or more aren't getting good results and the final thing is I guess if you can't charge 5k per month or more, you're really not going to be able to get this to that level. So for context, an agency I sold was, we did landing pages in CRO. So I basically was charging 8 to 15k per month. We're going to call it 9.5k on average. And I had basically at my peak 49 clients paying this. So 49k per month, let's just say 49 times 9,5 on average is 465k per month. But then I also had 77 white label partners paying 5k per month for my landing page service. So this was my Croat is 385k. So 385. Oops, I multiplied that pretty bad. This on its own is 850k in MRR and I had about 900k in MRR. So 900k or 850k times 12 is really that 10.2 million per year mark. So this is like a real example for landing page white label of how this would actually work in your services. So I had this going for me plus a lot of one time revenue. And that is how I was able to grow and scale that business for you know, basically that scenario. If you are someone who's charging like 2,500 per month per client right now in my view and that's like that's you think you can't charge anymore. In my view that is a situation where you would need you know, 333 clients when you account for CHURN and when you account for just the quantity of leads you're going to need to generate in it's just not going to be feasible in a lot of markets in my opinion. And it's just something that you have to kind of recognize. And I really think that this is a good guideline. If you can't get 10% monthly churn or less, you can't generate at least 10 qualified leads per day. If your clients are getting results at 75% or more and you can't charge 5k per month or more, it's just not a realistic business model to get to 10k per or 10 million per year. I'm not saying that you have to get to 10 million per year. A lot of people watching this channel are probably don't even have that goal. But for this video that is the kind of approach and it's just not feasible. And I think you need to go back to the drawing board and kind of think of a few Things number one is you know, my pricing. If I. A lot of pricing issues are kind of a matter of your opinion as more than objective fact. A lot of people will just pay more and you just, it's a self limiting belief. Then the next thing you gotta think of is value. Like okay, I've raised that pricing and let's just say we've done that. What can I do to make my service better? The number one thing in my view is you can do is choose a niche where you can productize and it's the exact same service over and over that is pretty much guaranteed to work. Something like lead generation for business loans, lead generation for commercial cleaners. It's very hard to become a Facebook ad agency for E commerce stores when you might, you know, there's not really any learning so you can't just duplicate the ads for E commerce stores with all the different brands and products and expect it to work. It's kind of a nonsense niche in my opinion. Even though that was the one I did value. And then just your lead generation. If you are trying to take this approach in a niche that has, you know, 10,000 total people or 5,000 total businesses and you're going to try to generate 333 clients at a time, going to be very unlikely to say the least. So you're really going to want to choose like what is my pricing, how can I charge at least 5k? What can I do so they actually get good results and then is it possible for me to generate that many leads? And if the answer is no, then probably not the right approach for you. Just how it is, the next is the ultra high ticket and there are pros and cons of this. The pros like the original thing or the initial thing is like can I do something that is going to generate a hundred k LTV per year or more and if we just cannot do this, it's basically a non starter. So if we have 100k ltv per more per year, we are still going to need 100 clients and we kind of essentially want more than that. Like we realistically want a greater LTV than that per year. If you are going to do this business model I think that you really realistically are not going to want to do it for anything less than 300k per year which is 25k per month. If you charging on a monthly basis it's just too difficult to get that done. If you do less than that, which is 33 clients per year, it's very, very easy to get one or two or maybe three or four of these type of clients if you have the right service per month. And I tried to, I try not to be out of touch and it's, I know it's not easy to do this if you've not done it before, but assuming you have a service where you can charge it, it's a lot easier than trying to get 333 clients per month. Factory approach this is best for kind of lead gen offers, affiliate offers, you know, info and then enterprise. If you're not really in one of those kind of things, you know, we're going to put pay per lead there but I'm going to talk about that in the performance one. If you're not really in these kind of niches like it's going to be like very difficult to run this kind of offer. You can also do enterprise like, you know, web design, you know, that kind of stuff. The LTVs are just not going to be high enough in my opinion in something like E Commerce or local legion or SaaS to ever get you to like this kind of stuff. You're going to need to be in the Legion. For higher value industries you're going to have to have an affiliate model or an info model. Like not an info model but serving info where you can kind of growth partner. But we'll talk about that later. And it's just a very good model if you can hit these numbers, like for me I can hit these numbers, I could charge something like that. I have something that someone would pay 25k per month or 300k per year for. If you don't have that, this is not a not in starter for you. Most people don't, but you're going to know if you do it and in this case the things that you want to do, it's going to be very network slash, you know, personal brand heavy. Because you cannot basically do this without knowing the right people, without being around, you know, decision makers at high value niches and high value companies and without networking or having a personal brand that draws those people and gets you out of the crowd, it's not really going to work for you. The next thing that it is going to rely on is can you get 300k or more. And if that's not true for you, not really going to be proper. And the final thing is it's going to be a long sales cycle. So basically instead of going for the call with outreach and ads and that kind of stuff, you're going to be playing the long game and it's all going to be driven towards your content. That basically builds trust and basically means that if they hire you and you fuck it all up, they're not going to be blamed and get fired. When you go up market to people who will pay you that much, you're not really dealing with the founder. Most of the time you're dealing with a head of marketing or someone like that. And if they basically hire you and you ruin it and do a horrible job, it's basically like they can be fired for that and they can lose their mortgage, tell their wife and kids that you know, they hired you and you ruined their life. And I'm not even exaggerating at all here. Whereas like no one gets hired or no one gets fired for hiring Amazon web Services, or no one gets fired for hiring the leading provider in their niche. And this business model is really just as much as you're actually delivering client results, the perception that you can deliver client results is just as important. And if you don't have that perception either through a good network or personal brand, it's going to be a tough one. It's going to be a tough one. I love Ultra high Ticket. If you can pull it off. If you can't and you can't get 300k or more LTV, I'm going to actually erase this. Not going to be possible. Just how it is. The next one is performance. And this is kind of my favorite one. But the key word in the performance only business model is performance. If you, or we're going to put if your service sucks, this is not for you, I guess, obviously. But the keyword in performance only is performance. This is good if you can provide huge or I guess the word unlimited value. So for example, a situation where this is true is like let's say you do Legion for financial advisors and you did that for 5k per month. If you find yourself in a situation that you are very good at your service and you essentially provide 50k per month in value for 5k, you might as well switch to performance only. And instead of basically taking out retainer or fee for generating these leads, you will, you know, take the risk yourself. Generate the leads through ads in like or outreach. You are basically taking that cost yourself. That's why it's called risk. And you are selling the leads in a performance model for them. So maybe you do it for 200 a lead. You just sell them and they're buying the lead for you. There's no meetings, there's no, you know, dynamic where you Work for them like you are basically a lead seller to them. And that's a very good business model if you are someone who gets good results. If you were an E Comm agency that does Facebook ads, you would just become, okay, we're not going to do that anymore. I am going to spend the money on ads and you are going to pay me. A cpa. In my view, the end of all agencies is a performance only model, I guess if the situation warrants it. If you're the best web designer in the world, there's not really going to be a performance model offer for that. You would probably do the ultra high ticket. But all three of these things, the factory approach, the ultra high ticket and the performance only are really the three models that can get you to 10 million per year. And if you don't have one of these, I would say it's very unlikely you'll get there or and if you do, it's going to be unnecessarily or needlessly difficult. So I would run through the numbers if I was you and see which one could work the best for me. And I would completely reorganize my business to one of these three models if I'm trying to get to $10 million per year or more. I know that's not everybody's goal. Some people just do agency for cash flow originally and want to go into Ecom or SaaS or just do something else. Agency is a great model for that too. Developing cash flow, developing skills, developing a network. Not everybody wants to do this, but if you want to do and assuming you want to, because you've watched at this point in the video, but these are the three models you need. So thanks for watching and I'll see you in the next one.