While most of us were happy to have a job flipping burgers or delivering newspapers when we were teenagers, Scott was building his first web business. Fast forward a few years later and Scott's been named as one of Youth in Motion's "Top 20 Under 20™ in Canada" as well as one of 21 Inc's 50 Emerging Leaders in Atlantic Canada.
At just 23 years old, Scott's already tasted the sweetness of success and the bitterness of failure. His first web business started out promising but ended up leaving him $800,000 in debt.
Older and wiser, Scott picked himself up, dusted himself off and started Infinitus Marketing + Technology, a remote agency made up of specialists from all over the world.
Kevin and I sat down with Scott to talk about the lessons he learned from overcoming challenges over the years, and he shared some surprising insights into how he runs an effective agency.
If you didn't get a chance to listen to the podcast episode, here are some of the major points along with show notes at the bottom. All quotes are from Scott.
[ NOTE: Subscribe to our podcast on iTunes and listen to the full interview ]
How to stabilize cash-flow and build better partnerships
Normally when agencies work on projects, we bill our client a percentage of the cost upfront and then invoice installments until the work is done. Makes sense, right?
Scott does it differently:
"For the most part all my clients have to sign 12-24 month contracts. Let's say we're doing a website for $40,000. We'll 25% up-front and bill the rest over 24 months. We'll include the maintenance cost and host it on our server. . The majority our our costs are spent upfront but then every month we'll get a pay cheque to put against our residual services. We don't actually have to do a whole lot more, but what it does is creates a much better partnership. Clients feel like they can give you a call and ask for something and we'll just apply it against their monthly bill."
Spreading out payments over the course of a year or two sounds counterintuitive — after all most of us want as much of our money up-front as possible — but the ingenious thing about it is that it keep the relationship with your client active.
If you built a website for someone and then called them up 8 months later to talk about ideas for improvements, it might appear as if you're trying to up-sell. But if the client is already paying you a monthly bill, they expect and appreciate regular phone calls.
As a result, the work improves since you're constantly testing and refining every month, and you get a steady payment over the course of two years and can predict revenue easier. Also, when clients increase the scope of the work, the additional cost is easier to swallow because it just gets added to their monthly bill.
I thought this was a really effective strategy and wish I had thought of it when I ran my agency.
Why trade shows are dead
It's tough to generate new leads in an agency.
Usually you have to wait for the proverbial phone to ring, and hope that enough good quality leads organically come your way.
When asking Scott about how he generates new leads, he was very clear that traditional "lead gen" types of activities agencies use don't work for him. He doesn't respond to RFPs unless personally invited by a warm contact, and he avoids handing out business cards at trade shows — in fact he avoids tradeshows altogether.
Instead, Scott focuses on providing value to his audience by planning regular dinners to connect people in the business community.
In fact, Scott's dinners were such a game changer for his business that he wrote a book about it, called Connections That Count. As a result of the dinners, he's helped connect people who ended up forming partnerships, landed investment deals, and Scott's gotten many new clients from the referrals through his network.
"If you're giving value to other people, you're always going to get value back. it's the law of humans... It's not networking, it's connecting with people. It's understanding people."
It's a different way of approaching sales, and one that's clearly working for Scott.
How are some ways that you can apply his advice? What do you think about Scott's unconventional methods? I'd love it if you left a comment below.