Is It Worth It To Start an Agency in 2025?

If you've watched any kind of YouTube videos on online business, you've probably seen hundreds of these agency guys telling you why you should start an agency and why it's such a good business model. Right at the end, selling you a course on how to start an agency. Now, that's not to say that I'm not going to do that to you in this video. I'm kidding. I'm not. I have no agency course to sell you. I just want to make a real video about whether you should start an agency in 2024. So when I first started my marketing agency, I started it because I was thinking about online business and I was thinking about the concept of building businesses in in general, one thing I realized is that every single business needs marketing. Now, this isn't a secret. Every business, no matter who they are, if they want to grow, they need some form of marketing, whether it's word of mouth, whether it's advertising, whether it's outreach, whether it's organic social media content. Marketing is needed for people to find out about a company in the first place in order for them to get customers and sales and grow. I decided to start a marketing agency knowing that it would teach me arguably the most important part of business, which is getting customers in the first place. If there are no customers, there's no business. For that reason alone, I think marketing agencies are incredibly powerful. But that's not to say that you should start one just because every business needs marketing. With every business that I start and I either invest in or I consult with or we partner with, one of the first things I look for is longevity. I want to see that that business is not just a trend. It's not just something that's popped up and a bunch of people have started talking about it over the last few months. I want to make sure that this is a business that can actually last a long time and be around for a while. And if you look at some of the biggest companies in you'll see they all sell products that aren't just products for today or for the next 6 months, 5, 10, 15, 20, 30 years. The thing about agencies and marketing agencies specifically is every business needs marketing. So if every business needs marketing and we live in a capitalistic society where anyone can go and start a company and sell products to other people, that means marketing agencies will always be needed. And you could argue, oh no, there's AI now and people do X, Y, and Z. At the end of the day, business owners starting companies, building products want ways to have more sales for their product. And that's where marketing agencies come in. That's why marketing agencies get hired in the first place. So one of the really attractive things about starting an agency for me was the fact that I could continue to build and nurture this thing. I will be selling a service that gets better every single month, every single day that I put work into improving the product, the service itself. And over time, as that service continues to get better, it will be harder and harder for people to compete with me in what I'm doing. Now, if I'm selling a service that can be sold for a very, very long time and I make it harder and harder to compete with me, then I can capture a larger amount of the market. And what that looks like is working with more and more businesses and getting paid more and more money to do marketing for these companies. One of the reasons you might consider starting a marketing agency is because it's going to be something that's around for a long time. But if you are only interested in making a bunch of money in the next 30, 60 days, it might not be the best strategy. When you're starting an agency or a service business, there's two types of agency that you can start. The first is a service business that saves people time. Now you can think of cleaners, for example, as a service business. There are cleaning companies that will save you more time by doing cleaning for you. That's the same with cooking. Things like content agencies potentially, which are becoming really, really popular. They typically save people more time, so they take work off of a content creator's plate. In exchange for that, they get paid. After they pay the rest of their team and the rest of their expenses, they have profit. The other type of agency is an agency that makes people more money. My company primarily focuses on this, and this is helping helping people increase their revenue. The best kind of agency is a service, an agency that combines both of these things. And if you look at advertising as a service, typically a company that has just started advertising is spending a decent amount of time trying to figure it out and trying to be successful with it and managing it and figuring out if they can spend more money, how much profit it's bringing them, etc., etc. And advertising services do two things. They help people make more money because we spend money on ads that are proven to generate extra revenue, and they take the time of Managing the marketing off of the business's plate. So it creates a very strong offer and the strongest offers, the strongest services combine these two elements. And these are the types of services that you can charge the most amount of money for. Any kind of business that you might start online will teach you foundational skills to business. They'll teach you how to get customers. They'll teach you how to make a product or a service that you can sell to other people. If successful enough, it'll teach you how to hire other people and manage other people and gain more leverage from the hours that you have in a day, implementing systems, using things like code to save time. All of these are great business fundamentals. Now, if you look at all of the different kinds of online businesses, there are fundamentals that you'll learn with each one. However, agencies teach you the most out of all online businesses. They teach you every core business fundamental that you'll need to know, need to learn if you're going to continue to be building businesses for a long time. If you're an entrepreneur and you want to scale companies. Agencies teach you everything from operations to sales to marketing to customer service and experience to making products, improving products and services. By working with all of these other businesses as well, you also learn tons about business. So you got to see the insides of lots of different companies where somebody going and working a typical corporate job might see the inside of one company. And typically these, these corporations people coming out of university these days are going to work for, these old dying beasts that, you know, was once successful 50, 60 years ago and are kind of on their last legs of growth. They might grow 20, 30% a year. They're old businesses. They've got lots of systems and structure and they don't move very quickly. So people go and work at these companies and they get one perspective of what the inside of a company is like. And that can be a very damaging perspective because when you work at an agency or you start an agency, you get to see the insides of all of these different companies and you get to see that the typical things that companies think they need often don't apply. And some of the most successful businesses that we've worked with, 1 to 2 person teams making millions and millions of dollars a year with incredible profit margins, don't do the regular stuff that most people think they have to do in business. So you get to learn all of these different things and you get to see all of these different perspectives on business. The other really attractive part about starting an agency is it requires no upfront cash. Most of these other online business models, let's take e-commerce for example. If you're selling physical products in e-commerce, we have a brand that does exactly that. You need a lot of money if you're going to grow that business. You either bootstrap it and accept the fact that it's going to take you years and years for this business to become very profitable and to make a lot of money, to be very successful, or you do something like dropshipping where you sell somebody else's shitty products and you're limited by the fact that you can't actually go and improve your product, which means that when customers come to you and say, hey, there's a problem, or hey, I'd like X, Y, and Z, and if you can do this for me, I'll spend more money with you, you don't really have that ability. So with dropshipping, you're looking for a product that you, that you can sell, that somebody else's, that you can capitalize on a few trends with and you can sell as many of these products as possible before somebody else comes and steals your entire business from you. And for that reason, most online business models, most business models kind of suck for beginners. Now, agencies don't require any of this. You don't need to spend any money to get an agency started. You're selling services and you're essentially selling time and people's time. For an agency to actually get started, all you really need is a computer, a Wi-Fi connection, the ability to learn, and the drive and the willingness to go and reach out to businesses and find people that to hire you. So if we take most businesses, if we look at an e-commerce business for an example, the profit margins of an e-commerce business are typically between 20 to 30%, which isn't bad. If you can get a business to $100,000 a month, you're making $20,000 to $30,000 a month in profit. That's a lot of money. But the problem is getting to $100,000 a month. And the difference with an agency is you can sign 4, 5, 6 different businesses and you can be making $20,000 to $30,000 a month in profit. Because if you position yourself correctly, people are paying you for the value you provide. People are paying you for the money and revenue that you can add to their business. Taking somebody else's already established business and doubling its revenue through marketing is much easier to do than trying to grow a business from scratch. So by being able to double other businesses' revenue and being able to take $2,000 to $10,000 a month in exchange for doing this positions you as a revenue driver, which is something people will pay lots more money for no matter what the expense to you as a founder is. It might only cost you between 20% to 30% of what you're charging these businesses to actually fulfill this product and fulfill this service really, really well, which means that all of that extra money, it's profit in your hands. And if you've set up retainers, if you've set up good structures with businesses that allow you to continue making money every single month, then you have cash flow, you have MRR, you have monthly recurring revenue that will continue to pay you month in, month out, whether or not you're getting sales every single day. And this cash flow is one of the things that allows people to get to $5,000 to $10,000 a month in revenue and profits so quickly because you're really just trying to get between 3 to 6 clients on board in order for you to be at that $10,000 a month in profit mark that everybody's always aiming for. So that makes agencies a really, really attractive business model because if you don't have much money or you don't have any money right now, you probably can't afford to go and manufacture and create your own product and spend $5,000, $10,000, $50,000 on inventory so that you can actually sell products in the first place. With agencies, you don't have any inventory expenses. You don't need to pay anything to be able to service and start signing clients and then delivering the service to people. Another strong argument for agencies is the context of an agency. You going to these business owners offering a, again, $2,000 to $10,000 a month service. Now, if you're speaking with the right business owners, they're already used to spending this kind of money on hiring people. I spend millions and millions of dollars a year on team, on people that we hire at Flax that work with us, that help us do everything from marketing to sales to service delivery with clients to software development and manage a heck ton of projects that we have at the company. If somebody approaches me offering something that's a few thousand dollars a month, I'm already used to, and I already hire several people every single month, paying them between $2,000 to $10,000. And as a result, if somebody comes and pitches me a service that's a few thousand dollars a month, this doesn't come as a surprise or a shock to me. What I care about is the value that they're going to add to my company. So I'm not particularly jaded or baffled when somebody offers me a service that's thousands of dollars a month. And this is the same for the prospects that you can speak with. If you're talking with the right business owners that have hired people in the past, they're used to spending this kind of money. That gives you a really unique advantage as an agency because you're not starting something that's completely new from scratch that people have never heard of before, and you're not going and offering something completely out of the box. You're you're offering something that people are already very familiar with. So it comes down to your ability to actually sell people. And if you can sell people and if you can learn how to sell people, if you can learn how to have conversations with people that lead to them giving you their credit card information and becoming a new client, then you have an incredibly valuable skill that you can continue to grow and nurture. You start an agency in 2024. Yes. And it's no different to starting an agency in 2020 or 2016 or 2020. 2010. No matter what these gurus are telling you, there really is no difference. Agency businesses have been around for a very long time. They are a type of a service business. The biggest service businesses in the world are KPMG, Deloitte, McKinsey, and these companies do hundreds combined, hundreds and hundreds of billions of dollars per year in revenue. So if somebody tells you that agencies don't scale or there's not enough opportunity or the business model is dead, they really have no idea what they're talking about. And if you're looking to get to the point where you're making $5,000, $10,000 a month online in profit, agencies are probably going to be the best starting business for you. So there it is. I wanted to give my unbiased thoughts on running an agency as somebody that actually runs an agency that isn't just trying to sell you a course on why you should start one. I've made millions and millions of dollars running an agency at this point, and it's changed my life. And I think if you put the work in, if you dedicate yourself to building it and turning it into a company, it will reward you as well.