Year in Review: 2024

LinkedIn says I’ve been the founder / GM of 42 Agency for almost seven years. But this isn’t really about the last seven or so years. Instead, I want to talk a little about last year, this year, and maybe a little about what’s next.

Jan — March

Going into Dec 2023, we had a decent pipeline, but we had churned *alot* of customers. The ZIRP era had come to a halt around Aug of that year & our customers were struggling to sell their products, so naturally, the question became, do we need a *marketing* team (and agency), and what other expenses can we cut? Alot of our customers had to lay off alot of people (one even fired their CEO, but we survived, tasked with turning around the business). By November, we had lost almost 55% of our revenue, but we had payroll & other costs that exceeded our current revenue, so the company was making a monthly loss. I stopped taking a salary to help plug some of the costs & also significantly withdrew from the company resources to make payroll & pay bills. I knew we had to cut costs & lay off part of the team, but we were close to the holidays, so I waited till January to do the complex parts.

The December pipeline did not close at all. From the 6–8 active conversations we had then, we managed not to close a single one. I was in a very dark place mentally, burned out and tired of all that had happened over the last few months. I debated closing down the business or selling what was left of it. My wife was highly supportive and patient; my kids were blissfully unaware.

When January finally rolled out, I held out hope that we would close just *one* effing deal to get a win, any win under our belt. But we got none. Worse case, I told myself, I can always get a job. But once you’ve been alone for so long, you get used to it. The freedom is exhilarating & the lows hit you hard, but every choice you make (decisions good & bad) is ultimately yours. There’s an enormous sense of responsibility and freedom.

I had for the past year made my fair share of bad decisions, from hiring too many people (because I wanted to have a ‘big’ company for my ego) to financial bets (because the year before had been our best year in business yet when we crossed 1M in revenue for the year, hell I even bought myself a nice Oris ProPilot Rega as a present to myself that I wear as I write this as a reminder) and launching too many ‘other bets’ like research & creative standalone services that diluted our focus off the core business. I read somewhere (likely Twitter) — you should fall in love with the company you have & I had made the mistake of trying to become something that was not in our DNA.

I had not made the best hiring decisions, but technology stocks were flying high post-COVID. Companies were spending truckloads of cash on top-line growth metrics, and we were one of the shops that did it, so the money was flowing. Money can help hide many problems, and it sure did for us, but I didn’t know any better or care. Clients were paying us, we were making a healthy profit, and I could pay myself a good above-market salary. We just had an offsite in Mexico City with most of the team in March 2023 & it was the best feeling ever knowing I had built this over the last 5–6 years.

*from left — Ana, Betti, Mallory, Alejandra, Sebastian, Federico, Carlos, me & Herber*

March — July

Quitting was not an option. I had no desire to return in-house; having my own business meant freedom of time. I could pick my kids up from school, drop them off, and take them for park and play dates in the middle of the day, knowing the team was on top of things. But as we downsized the team significantly, it also meant I had to play more of an active IC/manager role in the business & work on client accounts directly (which, honestly, I did miss as well).

We (as a family) had made plans to visit China (where my wife is from) for a month, but in early January, my wife and I started talking about me possibly staying back so I could work and try to get the business on the right foot.

Luckily, one of our older clients had joined a new company, and she emailed us to start the discussion. We were in a long security review process by March (when the family was leaving), so I could not just leave. While this was the longest I would be away from my kids since they were born, I had little choice. This deal could help us get in better shape.

We closed the deal in March > April. That was a big win. It added much-needed confidence in me and made it worth the decision not to go to China and Vietnam. Although my wife had to fly for 15 hours with two kids, they were complete champs and on their best behaviour.

I also hired our new head of DG / Senior Strategist, who was onboarding with us because we were understaffed. DG was 30% of my focus & we needed someone who could focus on it 100%.

We had some leads come in (2–3, I remember distinctly), but we never nailed down our sales/closing process. I was working with a sales coach (shoutout to Liz) who helped me get better at discovery & asking the right questions. As a ‘technical nerd, ’ my inclination was always to try to solve the problem for the prospect *while* on the discovery call. This caused two problems: 1) they did not value us ((this dude doesn’t take time to think about my business & my problems)) and 2) we did not give them a reason to talk to us. We were trying to sell higher (10K — 15K / mo) deals, so the process needed to build trust & confidence over time. A non-transactional sale cannot have a transactional sales process.

I was also an ego-driven founder. One distinct prospect asked to meet the team as part of the sales process, but I was adamant that they sign a contract first as we had already done ‘enough.’ We ended up losing that deal, but I comforted myself so (somewhat foolishly) that they probably were not a good client anyway. Truthfully, while we were not losing money every month since reducing costs & headcount, we were *just* barely profitable.

This also leads to introspection on ‘what we do & what our value is,’ which we, or I, had never considered. What kind of ‘business are we in? Are we more consultative or productizied? What value do we deliver? Who is our customer? Are we for up-marker enterprises? Startups? 100M or 10M?

one of my many brain dumps on business & strategy

I wanted to ‘create’ a POV & ‘framework’ for us. But truthfully, we didn’t have it nailed down. We were a mix of ‘consultative’ & productized work, never entirely on one of the spectrum of the other. I enjoyed solving complex problems with good people but was also not as focused as the founder.

As our Senior DG Strategies (Kat) ramped up, I started to think more about sales and why we had lost the deals we had lost. I also ran a closed lost survey to four closed lost deals (offering 250 GC for their feedback) and got great feedback. What stood out was that there was not ‘one’ single reason we lost a deal. We were usually one of 2 but never quite the top choice. Some needed more hand-holding & thought we could not offer it because we were too scrappy (i.e., the founder taking sales calls). For others, we were too expensive & some thought we were great, but their internal priorities had shifted.

We had sales conversations but could not close any significant revenue. However, some Hubspot / MOPS and DG clients kept us busy. I was the MOPS strategist then, doing a lot of hands-on work (as I continue to) with the team on both DG and MOPS.

As the team had slimmed down, I saw gaps in how we operate & make decisions. I realized that the team could have operated better, and I often had to make both micro & macro decisions. Part of this *might* have been just my control freak (which I never knew I had) & part might be just operating principles. We did some internal workshops to try & empower the team & I also got hard but great feedback that I needed to give the team space to make mistakes & learn & build confidence.

In April 2024, we launched our new website (as you see now).

June — Sept:

Summer is always a quiet time. The kids were back after their trip to visit grandparents & family in China & the business was in decent shape. The team was operating well & we decided to take the kids camping (their first camping trip ever). We had moved to Vancouver the year before & wanted to explore more of the outdoors. We had not closed any net new revenue, but our existing customer base was well-serviced & they were happy with the results & the work we were delivering. We had a leaner but more efficient team. I did not realize how much more ‘overhead’ a large team has regarding managing, comms & alignment.

We started doing daily standups again, and I focused more on our pricing, packaging, and sales process. I needed more at-bats to get better at sales, so we did some social sponsorships (shoutout to MKT1 and Emily) and got some inbound lead flow going. We started thinking about a discovery deck, and our new website resonated better with the market. I also had some time to think about the business, team & operations & we did a round of feedback across the company. I got some hard feedback & I also had to give challenging feedback, but I firmly believed it was needed. The year before, I had operated like an absent leader, or more so, operated by consensus; I wanted to be ‘nice’ so I would always get everyone’s feedback before making decisions. But that also led us to lose track & as the founder; it was my responsibility to lay the roadmap, make decisions & enforce them. The team felt some discomfort & harsh feedback, but as I told them, I have never run a company before, so I was learning too. One of my mistakes in the year before was trying to avoid making decisions. This time, I was actively enforcing my decisions & vision of how things should be done. My job was to show ‘what good looks like’ & make sure everyone could hit the bar. It was an adjustment, but we found some rhythm (we’re still working through this as a team & me personally)

The good news is that after a ‘spell of bad luck & losses,’ we closed one customer in August, which I was excited about. My wife and I celebrated that I had ‘broken the curse’ with a nice dinner with the kids.

Sept was also when Inbound was happening. In the last 2 years, I have gone to SaaStr (in 202,2, I went solo, in 2023, I went with Betti & Ale & we made a shuttle van to take people to the event, a high point)

In 2024, we decided to switch it up. I went to Inbound in Boston (and Kat joined, but we could not get her a ticket to the event since it was sold out). We bought a truck billboard for the event and parked it right outside the BECE, where Inbound was happening.

Up to that point, I had been very conservative. I closely watched our licenses, headcount, and expenses (especially Figma, which tends to add everyone as a paid editor every time you share a Figma design file), and it paid off. We had slowly built back up our cash reserves and margins. Now, with Inbound, I felt more optimistic about the state of the market/agency. We were not ready to do a big blowout, but I wanted to invest a little more.

In addition to the truck OOH, we also hosted a small happy hour at a nice bar in downtown Boston with Emily Kramer (who happens to live close to Boston half the year and was kind enough to come). I expected no one to show up, but we had a great turnout and some great conversations.

The whole truck + happy hour & inbound trip cost < 10K for us. It was worth spending time with people in the ecosystem & the team.

Oct-Dec:

It is December 12 as I write this, but we’ve had more momentum than we did this time last year and a significant pipeline. My paranoia was that we closed absolutely zero pipelines, but thankfully, we had a great close rate this time. I credit some of that to better discovery, pricing, packaging, and a more precise value prop from 42. What is still challenging is that everyone does seven and says the same thing, so how do we stand out?

I can distinctly remember when I started working on 42 — (solo), I was selling my expertise. Then as I built a team, I saw that no performance agency was doing good or any creative so we landed on ‘creaitve + performance’ as a differentiator. Now, creativity & performance are commoditized. Any good agency will also do creative work as it significantly impacts the performance of campaigns.
As we’ve gone through the year, we’ve been steadily building up our MOPS customer base & I have debated switching to a full MOPS agency (there is a gap), but I *think* the magic happens at the intersection of MOPS & DG & we seem to be one of of the few shops that can combine both. The analogy I use is front end/front of the house (what the customer sees, i.e. performance / SEO /content/emails) & back of the house or backend (automation, systems, measurement, enrichment) & we want to combine both to drive more yield & efficiency. Company positioning is not static; we need to evolve with the market, so this will continue to change.

Reflections:

Understanding myself is essential & my default state is ‘stir some shit up,’ so I tend to disrupt the team. I jump in, create a bunch of chaos & jump out. As the owner/operator/founder, I’ve realized that the team takes ‘what I say’ seriously. So I need to be careful about jumping in & stirring shit up. Often, they will drop what they’re doing to work on something I said on a whim. I’ve never had that kind of authority before, so it takes time to understand and handle it.
I need to channel my energy. I have a lot of ideas & want to do a lot of stuff, but only some things are possible or can be done quickly. I want to get shit done & move to the next. To channel my energy, I don’t slack ideas but write them down somewhere. I also started an e-commerce business with my wife (Little Robinhood), which helps me channel some of that energy into other things. (h/t to Janessa, Ali & Seb & Ale to help me realize this)
Hire slowly, fire fast. I was too slow to let go of people I knew were not growing with the business, and I had to ‘fill their gaps,’ but I liked them as people. Business and personal feelings need to be separate. They are not bad people, and I am not a bad person, but I need to grow with the business, and so does everyone else. I am proud to have helped most of them transition or continue to have a good relationship with them.