Moving beyond Freelancing: 4 Insights to Growing your Design Firm
I received a series of questions from a freelance designer concerning how to grow from being a one-person freelance designer into a “real” design firm. I thought I should share my answers to her questions with you. Here is the exchange we had – starting with her first e-mail.
I’m a graphic designer from Venezuela. I really love your portfolio and all that Go Media has accomplished. I’m also an avid reader of your blog, that’s how I found out you guys are soon going to move to a new building.
The question I want to ask you is simple: How did you do it? I know there are no secret formulas or anything like it. I just want a guidance or an advice as to how to be able to transform from a free lance designer working in my living room into a company with facilities, payroll, project managers and all of that…
I know it’s not an easy question to answer, and I also know you must have a lot of work to do… but I would really appreciate the good advice.
It’s funny that you ask this question today. I am actually posting a blog at 3pm titled “Accountants, Lawyers and Doctors oh my!” that talks a lot about the business side of being a designer.
But really, growth is all about making money. If you can figure out how to MAKE MONEY, then the rest becomes simple(r).
Let’s say for instance that you have developed a list of high-paying customers that have work piled up for you. And the money is just pouring into your accounts… but you can’t keep up with the demand… what are you going to do??? Obviously, you’re going to hire another designer to come help you. That’s obvious. And if you can keep that work flowing in, you’ll hire a second designer, then a third. Eventually you’ll need a project manager to help keep everything organized… …then a bigger office.
So, the REAL question is…
HOW do you get a lot of high paying design jobs?
Well… that’s tough to answer. It’s a lot of different things. I’m not going to be able to spell out a perfect step-by-step guide, but I can give you some of the basic insights I had that made huge changes in my business.
- First and foremost you have to charge enough money. I spent YEARS charging little or nothing. It’s hard to grow when you’re not charging enough money. But raising your rates is a double-edge sword. You can also LOSE business if you charge too much too fast. So, you have to be a good and fast designer. I suggest that you increase your rates ONLY when you feel “slammed” with work. That’s how I did it. I would inch my rates up every time I would be super-busy. It wasn’t until I was charging fairly high rates that I could finally afford to hire a staff.
- You need to work on expanding your client base. Gosh, where do I begin on how to do this? My first real break-thru was by volunteering on high-profile jobs. I was doing concert posters for free that I tagged with my company information. This is how I got a lot of my early customers.
- Once you GET a customer – you need to hold onto them. This means you need to give them exceptional service so they love you and tell all their friends about you. Referrals are a huge part of what made Go Media grow. We gave GREAT value for what we charged and our customers told all their friends about us.
- Get a partner. One big boost was finding my first partner Chris Wilson. A business has lots of little jobs to be done. Having a partner to split the responsibility makes you both more efficient. But pick your partner carefully. A business start-up situation with a partner is like a marriage. Actually, it’s much tougher than a marriage. You’ll be spending 10-15 hrs a day together, you’ll be broke, taking financial risks and everything hangs in the balance. You need to find someone you like, trust, works hard, etc. And after a fight, there is NO MAKE-UP SEX. So, it’s tough. I feel like I got real lucky with Chris. He was willing to take the risks, be broke and work just as hard as me each day (or even harder.)
I hope this helps some. Good luck with your business. Keep an eye on the blog and I will continue to try to pass along my recipe for success. Mostly it’s lots of hard work and patience. I started this company in 1997. So, we’re going on 10 years. And I really only started to grow in years 8, 9 and 10. It was mostly a 1-man firm for the first 5 years and then a 2-man firm for the next 3 years. Now it’s a 14-man firm. Crazy!
Her response to my e-mail:
Thank you for answering my question and for being so open about your success in such a humble way. I can see that being a nice guy like yourself is also the key to a successful business. I think everything you said sums up into three things:
- Being able to make sacrifices. What I mean is working your butt off for little pay instead of working for another company and earn a regular salary in order to make your company grow.
- Good promotion. As you did before, tagging your designs with your company info and what Jeff is currently doing promoting on the web.
- Being a nice person and treating your clients how you want to be treated when you are in need of a service.
Of course you can post my question as an entry to the blog. It is a valid question that I’m sure a lot of people need an answer to. My last thought is: Did you know from the beginning this is what you wanted to accomplish? Did you know from the beginning what you wanted Go Media to become?
I never thought you would answer so quickly. Thank you very much for all your advice. I’ll stay put to read your blog entry.
My response to her:
I try to answer questions like yours because I never had a mentor. I always wished I had someone I could ask questions to… but I had to learn everything the “hard” way. I just failed until I figured it out.
You are right about personality. Business is all about relationships. I feel like my customers are my friends and I hope they think of me in the same way. It’s important to have a genuine interest in your clients and THEIR success. If they succeed, you will also succeed.
Yes, I did have this company in my mind long before I got started. In this regard I have been blessed. I don’t know of anyone that has had such a clear vision of their future as I have. I think I was 14 years old when I first envisioned a design firm in a downtown warehouse office. And I’ll have it before I turn 35. Now, in my original vision we were all drawing comic books – so, it’s taken a few twists and turns over the years. But having a solid idea of your GOAL before you start working at it is key. Many successful people practice “visualization”. Spend some time to close your eyes, let your mind rest, then imagine in great details the goal for your company. How big is it? What does your office look like? What color are the walls? What’s the mood in the office? The more details the better. Even draw a sketch of it. Post it on the wall and remind yourself each day as you work on it.
At Go Media we have the entire staff work up a list of goals each year. Everyone has to write them down. This include a minimum of 5 personal goals and 5 professional goals. We review them at the end of the year, see what we’ve accomplished and work up new goals, or re-state our unaccomplished goals. The company does this too. What are Go Media’s goals for each year? I think writing things down is also helpful. I actually have a little scrap of paper in my wallet. On it I’ve written: “I will be engaged to the woman of my dreams by the age of 36. Go Media will gross 3 Million in sales by the end of 2010. I will run a full marathon before I turn 35. I will camp in the Redwood forest for 1 week.” That’s it. I finished the marathon this past month. I’m working on the other three. I had a previous sheet that I finished… so, this is my new one. I’ll probably keep this one in my wallet until we do it. We still have a LOOONG way to go on that financial goal!
I can see finding the girl of your dreams is going to be easy being the nice guy that you are (sorry for that). You have given me the best piece of advice of my life (aside from my mother). Right now I’m working on my online portfolio as a way to start promoting my work. I too started the wrong way, doing it all backwards, doing stuff I could not afford. So reading about making money FIRST really puts it all in perspective. I guess I was trying to achieve too much with too little. I hope you accomplish all your dreams by the time you are 36. I’m only 29 so I think I still have a long way to go.
My response to her:
Funny that you say that – Finding a girl has always been my HARDEST challenge. :)
Yes about the money issue… “growth” is easy once you’re making the money. That’s the real challenge… figuring out HOW to make the money. This form of growth is called “organic growth.” Because, like a plant growing, you take in a little sunlight, take in a little water and you grow a new leaf. One leaf at a time you grow slowly. But you need the water and sun (income) to grow that next leaf.
The other form of growth is known as “inorganic growth.” This is where you take out loans to jump ahead to where you WANT your business to be. You could theoretically take out a huge loan and hire a bunch of people and build an office. But I consider this a very risky move. If you’re just getting started then you have LOTS of lessons to learn and you will surely make loads of mistakes as you grow. It’s better to make those mistakes while you’re small, while there is less at risk. So, inorganic growth would be like growing the tree to full size before you see if you can even survive as a sapling. You could end up with a full size tree inside of a parking garage. You’d be like: “Crap! We don’t get any sunlight in here! And the water has oil in it! This tree is going to die.” But if you had grown organically… you would have realized early on that you need to move your business (tree) OUTSIDE of the parking garage and onto the lawn – where there is sun light and water.
So, in my opinion… avoid all loans. They cost you lots of money and give you a false sense of growth. Force yourself to only spend what you earn. Here are your ingredients for getting your business started: 20% elbow grease, 30% elbow grease, 50% elbow grease. Instructions: combine.