Growing up: The fourth and final critical hurdle on the way to £5m income

14th November 2023 – by Paul Muggeridge-Breene, Thrive CEO

Your agency may have taken years or even decades to pass £3 million of income. It will surely have been the most extreme of rollercoaster rides, with countless ups and downs along the way. You’ll have overcome all manner of challenges – some of them personal to you, the founder, and some of them about how your agency is structured and managed.

Now, as you continue your journey to achieving £5 million income, you have one more critical hurdle to clear.

The challenge

Put simply, to successfully pass the £4 million income mark, your agency needs to grow up. It’s now a mature business, regardless of its actual age, and it needs to behave accordingly. What this means is that the kinds of gaps that exist in the foundations of many smaller agencies, for example around policies and processes, are no longer acceptable. Both your employees and your clients have much higher expectations of this size of agency, and are far less forgiving of any problems.

If these gaps aren’t filled, you’ll find that recruitment and winning new business will suffer. The kinds of experienced team members you need to employ at this stage of growth will look elsewhere, and procurement teams at potential new clients will simply rule you out of processes to win new business.

The solution

To clear this hurdle, you need to manage a thorough review of your agency’s business foundations to make them fit for purpose – not just for the current situation, but also for the foreseeable future.

As you’d imagine, this should be considered a priority activity to ensure it receives an appropriate level of attention and focus. One way of doing this is to give one of your senior managers ownership of the process, setting clear expectations and an ambitious timeline for delivery.

Although every agency is different and will be starting from a different place, here are some key things to keep in mind:

  • Be really clear with your leadership team – and possibly even all of your employees – what you’re aiming to achieve. What does good look like? This is about embedding a mindset as much as setting expectations.
  • Does your business have all the policies it needs? Hopefully, by this stage of development, your agency has gone well beyond the basic legal requirements around health and safety, etc. But what does best-practice look like for your type of agency? There’s an almost endless list of possible policies, but certainly you should explore key areas like sustainability, DEI, equal opportunities, parental leave, sickness, disciplinary, grievance, ethics, benefits, remote working, etc.
  • Ensure your company handbook is comprehensive and up-to-date. This will likely house a number of your key policies, but how you introduce and explain your agency to new starters helps embed your culture and can also remove any room for misunderstandings in the future. Does a single person have ownership of your handbook – i.e. is responsible for updating it, etc?
  • What are you being asked to provide by potential new clients? Make sure your whole team knows to always flag this type of information up to you. Different organisations have different standards, and larger companies will sometimes expect to see policies and approaches not usually demanded of an agency of your size. Again, there are too many possibilities to list in full, but data protection and privacy is an area you should ensure you’re confident around (as you could be treated as a data processor by some clients, if you’re not already), along with sustainability strategies, modern slavery statements and gender pay gap data. 
  • As you start your business foundations review, your employees will be a rich source of intelligence. Do they think there are any gaps? Find ways of asking them that encourage complete transparency – for example anonymous surveys.
  • If relationships are strong, you could also ask your clients for their views. What gaps do they see? Did they have to jump through any hoops you’re not aware of to get you on their books? Do they foresee any challenges in the future?

There’s no doubt that building solid business foundations is best approached gradually, as an agency develops, rather than all at once. But this work can easily fall down the priority list during the earlier stages of growth, and so many agencies can find they have significant gaps.

Thankfully, in this case, growing up doesn’t necessarily have to be hard to do. By investing the right amount of time and energy you’ll be able to clear this fourth and final critical hurdle on the way to £5 million. Good luck!

Paul Muggeridge-Breene is CEO of Thrive, a former agency MD, former international journalist and a member of the British Psychological Society. Please get in touch if you’d like to discuss how Thrive can help you.