This email is an open-book look at an agency I’m building, what we’re struggling with, our profit margin and more.
I hope you can take something away from this to grow your own company!Bold SEO is 8 months old as of last week.We now have 85 customers, 11 employees and $165,000 of monthly recurring revenue.It has been extremely difficult – lets break down the process, profit margin and struggles:Customers pay us monthly fees to go out and source a certain amount of backlinks (links to their sites from other high authority sites) each month.This in turn increases their reputation in the eyes of google and thus their google search rankings.You can check your own domain authority (check your competitors too) here.Our job is to increase that number.It is a logistically challenging business with a TON of outreach to websites asking to post relevant guest posts with our clients links inside.I partnered with Barrett O’Neill (Boston) and Simon Purdon (South Africa) as operators because they are specialists in this arena and have built teams in the past.I own 65% of the business.We hired a sales person right away and now have two.They are paid on commission based on the deals they close. We also hired a team of 5 to handle the actual link building – reaching out to all the sites, writing content, and reporting to our customers.As soon as the business was founded 7 of my companies became immediate customers while we worked out the kinks.It is already working in a major way and our domain authorities and keyword rankings have skyrocketed.I began tweeting about the business to get more customers in June and we started bringing them on.It got REALLY stressful for the first few months as we were selling new clients faster than we had the capability of building quality links.Our margins are about 25% right now, so the business is generating about $40,000 in monthly cashflow.Most of it is getting re-invested and I acquired another firm with 25 clients and $50,000 of monthly recurring revenue in October of last year.Churn has been a problem (customers cancelling) for three reasons:1) We took customers that weren’t a good fit. We took on a lot of nationwide and SaaS clients early with extremely competitive search niches.2) We didn’t manage expectations well enough on sales calls. SEO takes 6+ months to start seeing results and clients expected it to take 30 days.3) Our reporting was bad. We were working hard in the background but our clients didn’t see us doing anything or hear from us.We improved all three of these things.We’ve found our sweet spot in small businesses that provide services to companies like law firms, landscaping, plumbing, moving companies, restaurants, government contractors, property management, contractors, construction, pest control, self storage, etc.Another huge challenge:There is a lot of website work that is required by our clients in order to rank.Page structure, keywords, landing pages, etc. None of it is in our wheelhouse or really what we want to be doing.We want to focus on building links but we’ve found there is no way around doing this work.We’ve had to do a TON of tedious on-page work for our clients and refer a lot of work to http://WebRun.com as well to get the sites setup so they can actually rank and work well or the backlinks are worthless.I’ve been driving most of the leads through this twitter, my newsletter and the company has it’s own individual twitter account now with 15,000 followers.We also hold quarterly webinars to teach small businesses about SEO and that generates a lot of leads for us.The funny thing: Word of mouth is picking up and we are getting a ton of referrals now from our current clients.One of our lawn care clients is now #1 on Google and his entire business is supercharged.A pest control company is getting $900 worth of new clients PER DAY from our services 6 months in.It is also accelerating leads at my own companies.Titan Risk is an insurance provider (competitive niche) and our site is less than 1 year old. Yet we are bringing in 5 qualified leads per month through GOOGLE SEARCH. That is unbelievable.My self storage business is also #1 on the google results in virtually every single one of our markets and our customer acquisition has started to accelerate.That is adding MASSIVE value to my portfolio.The business is working, providing a ton of value, and has a bright future.I’m not saying you have to use my company. But use a trusted SEO company to work with your business. It will make a big difference.