24 ms·
The “agencies of one” storm is coming
- webmaven 5y agoThis isn't as new as it seems. Agencies (including "agencies of one") have been doing work on retainer for as long as there have been agencies. The retainer model may be more common among legal firms than design agencies (largely because clients imagine their design needs are occasional or episodic rather than continuous), but it has absolutely been used for design.
- ypeterholmes 5y agoExactly. And I'd add one note- many businesses can't afford a "subscription" for thousands of dollars a month.
- WJW 5y agoHow do these businesses afford employees then? Surely a normal employer-employee relationship is even more subscription-like than a freelancer on retainer.
- klyrs 5y ago> Agencies of one say things like: Get unlimited requests and revisions, source files included, for $2,499/m. Okay, you can say that, but how does a single person satisfy "unlimited" requests and revisions? Sounds like a recipe for rapid burnout and dissatisfied customers, to me.
- tedmcory77 5y agoThe way many handle this is you get X requests a day for new things, revisions, etc.
- klyrs 5y agoDon't call that unlimited. It's limited.
- kfarr 5y agoAgreed it sounds more like 30 updates per month :)
- tut-urut-utut 5y agoIf big corps can call limited things unlimited, why now "agencies of one"? I mean, it is unlimited, within a reasonable use, and the agency is the one to define what is reasonable use and what is not.
- bruce343434 5y agoI've never seen claims like that without asterisks and small print saying "up to a reasonable amount" where "reasonable" is completely undefined.
- burkaman 5y ago> Is it really unlimited requests? > Yes! Once subscribed, you're able to add as many design requests to your queue as you'd like, and they will delivered one by one. You can make as many requests as you want, but it doesn't seem like he makes any guarantee as to how fast he'll get to them. > Because each and every request is different, it's hard to guarantee anything here but my general rule of thumb for a typical request is two business days. - https://intercom.help/designjoy/en/articles/5509274-how-fast-will-i-receive-my-designs https://intercom.help/designjoy/en/articles/5509274-how-fast...
- jsdwarf 5y agoHis offer seems like those 19,99$ /month discount gyms that are open 24/7. you can access them all the time but have no guarantee to complete your workout in 1hr due to the large amount of people. Not sure if that works for deadline driven businesses.
- ghaff 5y agoI would not use the term "unlimited" but, depending upon the nature of the work, it can be perfectly reasonable to have a subscription without an explicit cap. When I was an industry analyst at a very small firm we worked on that basis (with adders for certain discrete projects--consulting days, posting rights for research, etc.). It was never a problem. Frankly, getting big companies to get their acts together enough to actually do inquiries and things like that so they got value from us was a bigger issue than them being a constant time suck.
- jsmith99 5y agoThey can always rate limit by taking a day or two to respond to each email or revision request. That creates a limit of perhaps 20 interactions a month.
- munificent 5y agoPersonally, I wouldn't frame things this way, but one way to manage that sustainably is to observe that you can offer limited requests without promising any particular response time. As the number of requests increases, the latency of a response will go up. If a client needs a response in order to evaluate it for the next request, this will naturally lower the total number of requests. Also, clients will at some point realize they get where they want faster (i.e. overall throughput) if they are more parsimonious with their requests. In practice, healthy relationships and good faith clients and agents are probably sufficient for this to work out.
- brtkdotse 5y agoIn the same way a buffet satisfies “unlimited” fill-ups.
- macinjosh 5y agoThe same way Verizon promises unlimited data. Most customers don't maximize usage and in the fine print there is probably some hard limit or exceptions for what they feel is abuse.
- datavirtue 5y agoYou can outsource all of the work to Ukraine or India.
- smilespray 5y agoI've worked with several highly competent Ukranian devs, but I think most of them have other things on their mind right now.
- al2o3cr 5y agoRe: the example - an "agency of one" having a $1m year on $2499/mo plans means 400 client-months, or more than 33 clients a month every month. "Unlimited requests" for 33 simultaneous clients seems... unreasonable
- marcus_holmes 5y agoGym model. Gyms routinely sign up more people than they have capacity for, knowing that most people will go for the first few weeks, and then stop. I bet there's a normal distribution for the work that sees new clients creating 90% of the workload, fading down towards zero as they age.
- lgas 5y agoAgencies (even of one) also get economies of scale that gyms don't. You have templates, pre-built components, domain specific knowledge of how to handle common problems, etc.
- conductr 5y agoYou also have subcontractors that you can farm stuff out to or help when volume surges. I think the “of one” is likely not always true.
- abeyer 5y agoFrom what I've seen, it's pretty universal for contracts to individual freelancers like this to have an explicit "no subs" clause or at least require prior approval of specific subcontractors. I guess you could lie, or try to negotiate your way out of it in some cases... but I wouldn't count on that at scale.
- lupire 5y agoGyms have machines, and personal trainers have basic starter programs.
- janci 5y ago
- hardwaresofton 5y agoProductized Consulting, for the SaaS age.
- hammock 5y agoThis is a weird take because in the agency world (agencies of many, if you will), the long-term trend has been in the complete opposite direction: a retainer model is increasingly being replaced by project-based and time-and-materials work.
- leroman 5y agoThe "subscription" model seems unlikely, as today companies do their work mostly "Just In Time" or in the industry lingo - Agile style. To a contractor this means the requirements when he goes into a project are not clean, so he can't reasonably price the project. The hourly rate is in place so that in this relationship, work means more time for the consultant and more resources for the company wanting said work, this is the way it should be and keeps everyone on the same side. If you mean, like others mentioned here, a model where a company pre-pays for some amount of hours this contractor promises to allocate for this company (at minimum) - this is called the "retainer model", this is fine and is a good idea for small tasks and not a big ongoing project
- tptacek 5y agoTime and materials billing does the opposite of keeping everyone on the same side --- most especially hourly, which is just about the worst way you can structure a contracting relationship. My on this topic, ad nauseam, for over a decade on this forum: https://hn.algolia.com/?dateRange=all&page=0&prefix=false&query=hourly%20author%3Atptacek&sort=byPopularity&type=comment https://hn.algolia.com/?dateRange=all&page=0&prefix=false&qu... Particularly this fella right here: https://news.ycombinator.com/item?id=4103417 https://news.ycombinator.com/item?id=4103417
- leroman 5y agoComing from more than 5 years consulting, my conclusion is that hourly rate (a high rate) helped our motivations aligned. Context is important here, the work I was doing is helping companies with big complex software projects. Did you try something else? do you have different experience?
- tptacek 5y agoOur projects ranged from 2-person 2-week web app assessments to multi-quarter assessments of entire operating systems, from individual projects to long-term staff augmentation, and everything in between. I'm confident that hourly rates do not in fact align your motivations with your clients.
- noelwelsh 5y agoProductized consulting works when you can turn your offering into something that is standardized and hence repeatable. This works for some consulting markets, but not all. If you're going to make websites for restaurants, you can do this. If you're going to make high performance back ends, probably not.
- krm01 5y agoWe aren’t an agency of one (but three) and have been doing this for many years. It’s been very helpful for both companies and ourselves. Let me explain: We niched down to helping B2B software teams design better products (UI/UX). [1] That focus helped us get really good at tackling design problems for these companies super effeciently. Companies then benefit from just plugging us into their workflow and hit the ground running. In the end, we as designers get to focus on what we love doing without the hassle of classical agencies (networking, endless prospecting). So less time is wasted doing things we hate. And companies benefit from a more economic offering. Why more economic? Because we structure our business like a SaaS, our marketing is also structured like a SaaS. Clients find us, we don’t chase them. The reason classic agencies are super expensive is because they spend many unpaid hours looking for projects. Then when they have one, the client gets charged a premium to cover for the previously unpaid hours. A subscription model and treating the agency like a SaaS is more fair IMHO for both parties. [1] https://fairpixels.pro https://fairpixels.pro
- candiddevmike 5y agoA subscription model for consulting sounds like a salaried employee with extra steps.
- rubidium 5y agoExcept canceling a subscription is easy (for both parties!). Firing an employee is harder. And finance treats them differently.
- ghaff 5y agoYou also have more than one client. If you really are consulting for just one company, you probably are legally an employee.
- brtkdotse 5y agoAnd (at least in EU) double take-home money. Easily.
- 5y ago
- zelon88 5y agoWell maybe if MSPs didn't do such a bad job and leave so much low hanging fruit.
- reincarnate0x14 5y agoDiffering industries are often experience these cyclical inversions at different rates. At the moment there has been a trend in industrial power away from single huge projects and more towards managed services models, and I suspect a lot of that is down to accountants finding fun new ways to capitalize the costs. As someone who helped launched such a service, it's nice for me because the revenue is reliable, but I suspect both our services and contractor rates are much, much higher than what this is looking at. It's possibly more in line with the "small art design" markets in which you can hire a graphic designer or musician or whatever out of the global south that is doing solid work for a fraction of what a more developed country agency would charge. Which is great for everyone except the existing freelancers in said developed countries.
- mmaunder 5y agoThis is a natural step in business growth: realizing that recurring revenue is recurring, and then productizing formerly bespoke work to benefit from economies of scale. It is when a contractor becomes a business.
- jollybean 5y agoActually no. No company wants to deal with 100's of different agencies with different terms, and it's unlikely that someone out there is doing 'revisions etc' i.e. actual work and making $1M, there's some pricing misinformation or someone is selling some kind of service. Certainly it's not a template. Companies offering SaaS where there's very low friction - yes. But agencies like that, unlikely. I'm already in this boat the last thing we want is every single person to be on different terms.
- jdrc 5y agostorm? more like spring. People working on their own terms
- MisterBastahrd 5y agoStorm? I know several people who charge for an initial development fee and then offer recurring monthly packages which handle new development, updates, and maintenance on a retainer. They've been doing this for years. The best part about this scenario is that since the payment is already baked in, there's really no incentive for the "agency" to clamor for more unnecessary work. They are free to be advocates for what's best for the client since they will usually end up making more money by using the extra time to bring on yet another client than they would by servicing this existing client with more custom work.
- mariogintili 5y agothis isn't new - how did this made it to the homepage? Maybe this guy coordinated a bunch of buddies to upvote
- CPLX 5y ago> This is just freelancing! you might say, but it’s not. Yes it is.
- UncleOxidant 5y agoI read the article and can't tell if he thinks this is a problem or what? Usually when you have "storm coming" as he does in the title the implication is that it's bad. But reading the text and... I'm not really sure what the problem is and I'm not even sure that it's a new phenomenon. The article doesn't seem all that useful.
- mathgladiator 5y agoI'm very happy about this. I'm building a company as a solo engineer right now, and I've been thinking a lot about growth in terms of firepower. I've decided to not anyone for a long time. Part of the reason is that I hate being an employee, and I don't want to subject anyone to that: https://www.adama-platform.com/company.html https://www.adama-platform.com/company.html Instead, my bias is to find free people that enjoy their craft, and then use a waterfall model for various efforts.
- karaterobot 5y agoIf DesignJoy is making $1M a year selling $2500-$3000 month subscriptions, and there's only one person doing the work, then he's got around 30 clients for whom he is doing "unlimited" work every month. As a contractor, I once had 9 ongoing projects for about 2 weeks, and that was an insane amount of work and context juggling. Handling 30 active clients for a year, let alone a career, seems impossible. So either the clients aren't asking for much (which is most likely) or I'm missing something. I assume many bigger companies would happily replace a staff member, or a staff member's valuable time, with a ~30k/year contractor. Critically, these companies wouldn't feel the need to "get their money's worth" by keeping the guy busy every day. However, the smaller companies most freelancers see as their bread and butter are more cost sensitive, and will nickel and dime you as much as possible. Are there enough big, monied companies to constitute a "storm", which I take to mean a shift in the business model for freelancers and boutique contractors? I dunno about that. I'd guess no, offhand. Seems like DesignJoy has create a neat niche, which is awesome for him! I don't think it scales to the "disruption" level as this article implies.
- mejutoco 5y agoIMO some people have an unhealthy need to find the best deal possible (usually the cheapest), even if it takes so much time it is not worth it. The same way that some public contractors offer the cheapest rate knowing that it will be inflated, or that low-cost airlines sells you the cheapest ticket, later adding extra luggage, food, and healthy credit card processing fees, a strategy is to give these people what they want. I could believe after they have their unlimited service, a lot of the customers do not make use of it. In many of these cases the decision making at the client might even be the bottleneck.
- paulcole 5y agoUntil proven otherwise I'll assume any agency-of-1 will end up outsourcing to contractors at some point.
- datavirtue 5y agoWinner!
- andreliem 5y agoThis has been around for a while, but perhaps not packaged and marketed in this way. Probably quite effective when it comes to clients needing basic design needs. I don't see this working too well for actual building of software products, where it's not about the number of revisions that matter but more about spending time on the client + service provider relationship and building the right thing.
- claudiulodro 5y agoAs a developer, I think the closest parallel or most common way people do this is to be "the web guy" for a few businesses: part-time, ongoing small development and maintenance. I've worked with many people like that through the course of my work. It seems like a chill life, but I don't know that I've seen anyone scale it to more than what the average freelancer gets.
- mpfundstein 5y agonowadays its "the data guy" which is me
- codingdave 5y agoFreelancers have been kept on retainer for quite a long time. It sounds like the author just wasn't familiar with that business model. Which is fine - I don't want to be harsh on someone just because they had a knowledge gap - we all do. But there is more to being on retainer than just a monthly fee. There still is often hourly estimation because the retainer frequently will be for a set number of hours, with additional hourly rates if you go over that limit. (Freelancers who offer unlimited hours get in trouble fast.) Companies therefore still triage their needs, to try to get as much done in the set hours without incurring too many additional hours.
- solitus 5y agoYeah I'm not sure I would want to offer unlimited hours to multiple clients.
- ljm 5y agoI would consider it but it would have to be very repeatable and well defined and at that point, why haven’t I automated it? The posited Agency of One sounds pretty much like a beginning-stage SaaS while you’re doing things on pen and paper or a spreadsheet until you’ve figured out what you need to actually build. Otherwise, that seems like a fast track ticket to burning out. Retainer model and selling bundles of hours is going to keep your client incentivised to not waste your time.
- tptacek 5y agoRetainer arrangements and subscriptions look similar but are not the same thing. A retainer is a bucket of hours sold gym-style, use-it-or-lose-it. Within those hours, the customer has a lot of flexibility with tasking their contractor (what the scope of work is, and what the scheduling and staffing are). Subscriptions are distinctive because they include terms based on defined outcomes. You're getting X done every month (X may also be use-it-or-lose-it, but it isn't ever Y or Z), and the vendor (mostly) decides how best to accomplish X. Retainer agreements tend to have bespoke terms; if 5 clients retain you, chances are you have at least 3 different sets of terms and 3 different scopes of work. Part of the definition of a subscription, again, is that it's the same work for everyone you sell it to. Neither retainer freelancers nor subscription services should be charging hourly; hourly is a consulting anti-pattern.
- 4ndrewl 5y agoPeople have been doing this for years. Main problem is that one person can't scale and is _always_ on call (goodbye holidays, weekends etc).
- oldstrangers 5y agoThis is pretty funny to me. I just built https://gloutir.com https://gloutir.com, essentially a micro agency that's just ... myself. I realized working for large agencies that I'm already the person doing all the work, so why not get compensated accordingly? It was also amazing to me the amount of outsourcing that happens at an agency, most of them really don't have inhouse designers or developers (regardless of their massive size).
- fartcannon 5y agoThis is how a great number of infrastructure P3 projects are run. One professional engineer employed by a massive consulting firm signing off on the work of 50 low paid overseas designers. That one engineer will have 4 or 5 bosses and be responsible for as many huge infrastructure projects. The leaders of these companies are well connected charismatic used car salesmen.
- bendbro 5y agoThat website is beautiful
- manmal 5y agoThe copy is mostly talking about themselves though, and little about how they are helping the customer achieve X.
- oldstrangers 5y agoNot a copy writer, but wanted to highlight the shortcomings of traditional agencies. Also felt compelled to oversell what we do / who we are since I can't showcase most of my portfolio that's tied to existing agencies. Something to consider though.
- lancesells 5y agoBeautiful site but I think you're kind of only talking about yourself. I would address the problem points companies have and talk about them. In a sense your are speaking in abstracts.
- moonbug 5y agosounds terrible.
- davidw 5y agoIDK, in the US, trying to manage your health care as an 'agency of one' is probably going to keep a lot of people away.
- abeyer 5y agoMaybe in some states, but certainly not all. ACA health plans are quite easy to manage for an individual in my experience. I spent maybe an hour or two a year of paperwork on health insurance when I was consulting. (Now that doesn't get rid of the nightmare you're likely to face if you have to _use_ the insurance for anything major... but that's just as true on an employer health plan, too.)
- celestialcheese 5y agoThe worst part of the exchanges is the lack of access to PPO plans, at least here in Washington. HMO/EPO plans are trash if you live outside of major cities.
- kube-system 5y agoI bought an EPO directly from the local integrated health system for a couple of years and it was a great experience. It was inexpensive and I never had an issue with my in-network claims. Although, I had care on the other side of the country once with it, and they looked at my insurance card like I was a space alien. It took them over a year to figure out what to do about that claim, but eventually they worked it out between themselves. I would totally do it again -- it's about 1/2 the price of my current BCBS PPO for similar benefits. There's a lot more choice in healthcare when you're not part of a group plan that chooses your options for you.
- tptacek 5y agoMy big pushback on this is not that it's hard to be an "agency of one" (it's easier than you think), but that it's hard to stay an "agency of one" --- the business model work this article talks overlaps almost perfectly with the work it takes to scale a consultancy to multiple people delivering.
- stuaxo 5y agoThis is what is called contracting in the UK, as far as I can tell ?
- groby_b 5y agoUhuh. Except, we call that a retainer? It's not new at all? Of course, this is better - there will be of course no sub-contracting. No siree, won't be seen. And nobody is ever going to slow-roll "unlimited". Or phone it in. Not at all. And of course there will be no client ever who would abuse an "unlimited" contract and have you work 120 hours a week. Oh. Wait. Yes, there will, and it'll be just like it's now. There will be people you build a trust relationship with, and they'll get the juicier deals - because you trust them. They'll scale up, because they'll be asked more. And presto one-two-three you have an agency. Yes, it's a slightly different billing model. And it's more conducive to a "stardom"/"free agent" approach, but that also means it will only work for people at the top of the game - who don't want to scale out and make more money that way.
- outside1234 5y agoThis sounds like the "gym memberships" of consulting - where you pay for the ability to use a thing on the expectation that people don't use it often.
- thenerdhead 5y agoThis is already a pretty popular concept on Fiverr, YouTube, and other content-based platforms. Basically the TL;DR is the agency is a "face" which is a personality, etc, and the operations are run by a whole team and outsourced for pennies on the dollar. It's smart.
- krasotkin 5y agoI romanticize doing something like this, but my lack of experience in sales and lack of knowledge in general business dealings prevent me from going at it alone. I'd like a partner who complements my skill set. Reiterating another commenter's point, being on call 24/7 doesn't sound fun either.
- deleted 5y ago[deleted]
- godmode2019 5y agoThis is the business model I used before I got into high ticket work. It's the lawyer business model, they pay you a retainer just to stay a client. Largely to ensure you are around when they do need you. This works well with software as moving companies is near impossible, you will have to retrain a whole new team. It's hard to manage multiple clients and why I moved to high ticket stuff. Your agency of one soon turns into a agency of N.
- designjoy 5y agoFounder of Designjoy here. Happy to answer any questions ya’ll have!
- joshghent 5y agoThis is exactly what my business does! It's certainly not a new model of working but nice to see more exposure to the billing model.