Posted on February 18, 2009 - by Khaled

TOP 10 reasons why my Web Design company grossed 5 million dollars of revenue in its first year

Success... A word that might carry many different meanings! It can range from riding a bike without falling for a young boy, to making billions of dollars and be as famous as Bill Gates. Just remember Brendon Sinclair’s quote: “Success is whatever you want it to be!”.  But here we are talking about a specific field which is the web design and the web development business. In my opinion, being successful as a web design agency is measured by the quality and the prestige of your clients that were attracted by the quality of your services (You have to provide outstanding Web development services and have excellent technical skills along with an excellent capability of selling those skills). The number of clients is important too but if you are working for ten small unknown companies you won’t be as exposed as someone working for just one big well known company. This is going to be translated, of course, into dollars language. I started being involved in Web Design since 1999. I worked as a freelancer, started few LLCs here and there that were more or less successful and earned/lost random amounts of money. The real first success was when I started a Web Agency that was based in Paris, France back in late 2005. Since then I’ve sold the company 16 months after its launch as I had to move out of France and I was offered a nice amount of money to sell it to a communication agency that merged it to be an in-house web department.

A handy guide about creating a successful Web Design Agency!

It all started in a small office with a team of 7 persons including myself, the secretary and the accountant. We offered a restricted range of services that were: Graphic Design, Web Design and Web development. We only worked on projects with: Photoshop, Illustrator, Adobe Premiere, Flash, HTML, CSS, JavaScript, PHP, XML, Python and SQL. Nothing more!
After merely one year, the company grossed more than 5 million dollars. Here are few tips that truly helped me achieve this. I am posting this for educating and informing sakes, so I won’t include any names/brands etc… Of course 5 million dollars are not a huge amount of money for many people but I think it is a really good start for a new web agency.

1.    Planning, researching, setting goals and benchmarking

First of all you must identify the reasons that might help you succeed if you start your own company. Clearly set your goals and define the meaning of success for you: When/Why will you consider that your Web Design company is successful or a failure? How are you going to grow? What staff do you need? How much should you pay them?
Plan for everything, consider wisely your investments and keep them minimal, have your own specific marketing plan, think about how are you going to create a positive aura around your company? Ask professionals and business acquaintances for good free advice and make your research to validate their recommendations. Don’t just get their thoughts for granted. You should also avoid asking close friends and family members as they will tend to be subjective, but if you have a ‘successful’ relative/friend just ask them how did they achieve that? And learn! You must be confident when you take your decisions.
Do some market research; are you choosing the right region or area for your company? Is there enough business for you? What clients can you possibly target to get started? Are there any well established competitors? If yes then you must benchmark against your competitors, get to know their clients, the number and the qualifications of their staffers, their prices, how do they market their business, which ones are the leaders? Try to find out why? etc…. Now that you know a lot about them (While they know nothing about you yet) try to establish the methodology that will help you be competitive and to enable you to surpass them. Focus on their weaknesses and try to match their strong points.
Do all the previous by yourself and take the time to do it correctly this is really important as you’re going to save money (you won’t hire someone to do this for you) and you’re going to learn a lot of useful things that will help you to start, to survive and then to fully thrive.
This first point is the basis of all the upcoming points as you will notice! If you don’t elaborate it the right way then all the next points will not help you a lot as you won’t do them correctly. This phase took me a little bit more than three months (40 hours per week) and all I needed is computer, an internet connection, a phone, a library access and a means of transportation (you don’t even have to own a car, public transportation is just fine!)

2.    Create a remarkable, recognizable brand to build your business around

Unlike what you may think, this is a something tough to achieve. It has to both translate how you perceive yourself and how people must perceive you. Both impressions should be almost identical. Otherwise your branding is not working properly! You should set your goals, decide what will you do and what kind of specialty are you going to offer to which niche and start from there.
After clearly setting your goals, knowing your targeted audience, deciding how you want to be perceived (that’s how you perceive yourself too) convert the whole thing into material. Choose your company name (keep the domain name issue in your mind: preferably .com, easy to remember, easy to spell, avoid dashes, avoid words that may be written with different spellings such as color/colour etc…) Create a logo (if you are not good with logos hire someone), a professional looking one! Take your time, long session of brainstorming and sketching on a paper are inevitable. Choose carefully the colors (Royal and Marine blues are good colors to have in a logo by the way!) A logo should be created in a vector format and remember… A logo should be able to look good on a golf ball!
Once you have a nice, recognizable, unique, remarkable, professional logo you need to create your business card (make it stand out from the crowd, don’t just have a plain white business card with some black or blue text!) and the rest of your stationery (Cover letters, letterheads, envelopes, Fax covers, brochures…) and make them also unique and clearly inspired from your logo.
The next step is your website with your online portfolio and references. Don’t stuff it with tons and tons of data! Make it nice, appealing, unique, usable, accessible, Standards compliant, simple and a tiny bit sophisticated.
You may also create an offline Portfolio presentation to show during meetings with clients and that can include more content and details. Also create a PowerPoint / Keynote template for your presentation.
Make your email account look professional and avoid using nicknames and/or lots of numbers! Such sweetieses87799(at)website.com! john(at)website.com or john.doe(at)website.com or even j(at)website.com are a lot better.
Start using social networks proficiently and create professional Facebook, LinkedIn, Twitter, Stumble Upon etc… accounts. If you are just starting use the same profile image/logo in all of them.  Also create a professional IM accounts (don’t use your own) and customize them adding your company logo and so on…. All these components constitute your personal brand! So they must be unique, professional and share the same design/feeling/spirit.
Try to create an aura around your brand! Start an educational blog, write articles, write columns for a newspaper, attend conferences and speak during them, launch training cycles, meetings, events and educate people, write books, participate in radio programs or in podcasts, Join and help people in some web related communities ( i.e. SitePoint.com)… Make yourself visible!

3.    Brand yourself as a specialist/expert in something and pick a good niche

You should present yourself and your staff as being specialists in some given fields. You are not handy or the ‘jack of all the trades’! You are THE Company that can do this specific kind of work as you are, by default, the expert team that specializes in resolving these particular issues. When I started my “former” company in late 2005, Web standards were not widely used by the Parisian Web companies. Semantics, Accessibility, Usability and full-DIV CSS designs were not popular. That was a good starting point! Let’s just brand the company to be the one that fully respects Web standards and creates semantic, usable and accessible web sites totally relying on CSS tableless designs! But wait! This plan lacks something! Why would a client be interested in such web sites? There was a real need to educate the clients so we created a buzz around web standards by preparing documents, brochures and flyers to some potential clients, we carefully chose (point #1). We targeted fairly important companies that had old, outdated and clunky web sites. We sent them the prepared documents about the benefits of Web standards and we asked if we can visit them in their offices to make a presentation/speech about web standards and to point out problems about old-fashioned sites etc… We were not selling anything we were just educating. ~70% answered our correspondence and most of them were OK to ‘hear’ us. After the presentation, they were able to see the problems with their own sites and more than 50% of them immediately hired us to redesign their sites. That was the real starting point! We also started the same process about PHP Vs ASP (not that ASP is bad, but we used PHP and we had to sell that!). Soon we were regarded as the PHP specialist company of the moment. We were passionate and committed about Web Standards and open source so we were able to convince and to educate our prospects.
Another opening for us was the choice of a specific niche of clients to target. In addition tom y web studies, I have a Biology Ph.D. (was preparing it at the time I started the company) and this helped me a lot. When we contacted (or were contacted by) Biotechnology firms, food industries, research laboratories, pharmacology industries to have a proposal about the development (or re-development) of a web site or a web application I was able to discuss their needs and propose a solution that was by far superior to our competitors as I was able to understand the slightest details about what they were doing and what kind of solution they actually needed! And that was a huge advantage! Rapidly we were recognized as specialists of the Biology/Biotechnology/pharmacology field and we were even contacted by clients from outside France and Europe. I, then, dedicated all my efforts to pitch and make presentation for companies involved with this sector. I hired another person to do the same for the other types of companies and clients. Do the same pick up a fairly big niche about something you quite know! Are a sports fan? Target clubs and teams web sites! Are you into Music? You know what you should target and so on!
If you are specializing in solving some unique issues you will have less competition, you will provide better quality of services and you will be able to charge higher rates. A good example of a unique service is Webnotes.

4.    Build sustainable relationships with clients

The first contact with a client is crucial! First impressions are a harsh truth you will need to cope with. So you will need to look like a professional so that the client considers you so. Being good looking, well dressed and well groomed is a must. Always try to have a good firm handshake, to keep eye contact with your client while speaking, to avoid making gestures that will induce the client to think you are embarrassed, or that you don’t have a clue about what you’re saying. Be confident and show it, some small talk at the beginning and at the end is helpful, smiling is advised too. In all circumstances be polite. Having professional looking accessories is very important! A nice ink pen, professional well designed logo, business cards and stationery, a leather briefcase, a cool trendy watch are all small details that build up to create the whole image about you. An image of a successful and professional “businessman” (or woman). Because that how most of your clients will perceive you. A nice Website and a good quality portfolio are also a must! So, don’t start prospecting “big clients” until you have some good achieved projects under your belt.
Trustworthy, is a very important quality that all your clients will want to have! So treat them with respect, don’t lie to them, be punctual, be polite, respect the deadlines, give them prompt and useful answers, don’t talk about their businesses or “secrets” to others, don’t sell them things they won’t need, give them good advice about what to choose as a solution for their needs (or even advice them to go to some outstanding restaurant you know / be careful when you recommend something! So only recommend things that will 100% delight them) and you be recognized as a trustworthy and reliable person.

A good trick that will help you obtain the full satisfaction of your clients is to under-promise and over-deliver. Let me give you an example to illustrate what I meant. For instance, you will tell the client “Your site will be ready within 30 working days” while you know, after thoroughly and methodically studying the project with your team, that it will only take you 20 days to finish the whole web site (including testing and bug fixing). Saying that you need 30 days instead of 20 days (under-promising) will allow you to have some extra time if something went wrong or if you faced a given problem (imagine what can happen if the Web designer that will create the front end is sick for 2 or 3 days) and you will be able to deliver in time before the end of the deadline! Moreover if you actually deliver after 20 days (no problems at all occurred during the project) your client will be really delighted and positively surprised. Of course if you tell him that you finished within 20 days instead of 30 days (assuming you are not charging per hour) the final product must match at 120% what he wants so that he won’t have the feeling that you neglected some sides of the project or excessively rushed during some development phase! And when I say 120% I mean it! It is not a typo! How can you match a project 120%? Easy! Just over-deliver! Exactly match what the client wanted and add some extras! Some free CSS sprites here, a free AJAXified Anti-spam contact form there, 1000 business cards for the other one and your clients will be truly, genuinely and fully satisfied!! Combine this with “thank you” letters after each phase and/or meeting and with postcards, gifts, flowers and dinners to celebrate the successful end of a project or to congratulate them during holidays or special events and you will reach a new level of relationships between you and your clients! This can only benefit your business.
Delighted and happy clients will not only return but will also drag you more business through “advertising” and praising your services! And this is a nice ‘chunk’ of success!

BUT, even when you do all of the above and deliver outstanding services it is sometimes ineluctable that you will have an angry client or two that are malcontent with your services. And that may happen even if the website, the logo, or the application that you created for them is top notch. Not to mention if you, or one of your employees, made the slightest mistake. The best thing to correct the situation once you know that the client is not satisfied is to understand what is the problem? Ignore them and you may forget about having a sustainable relationship with them and you will not only lose them but you will lose some future potential clients. Indeed, an unhappy client will not only stop using and recommending your services to their acquaintances but also will be whining and complaining here and there about you and a snowball effect might build up creating a bad reputation about your company! And that’s the last thing you want! So just try to understand why Mr. John is angry with your CSS code or why Miss Sophie doesn’t like the colors you used to create her logo! Ask them why? And do it immediately! Don’t wait or delay! Work with them to find a solution that resolves the problem! Be sure they will be 100% satisfied with the alternative! In order to do so you must be sure that you understand the client! Some say I want a header while they actually want a logo! So ask the right questions. Change the ways and the formats you used to communicate with your client in the first place. If what they are unhappy about is actually the right thing for them try to calmly and methodologically advise them and make them understand! Use references or get some help from a colleague and involve your employees that participated in this project. If the mistake is due to some negligence or error from one of your staffers then you should address the problem with them, try to understand the causes, make them accountable for their mistakes and try to be assured this won’t occur again. Remember! You are not the boss of your clients! They are your boss!
Try to learn for such issues in order to avoid them happening again in the future! After all that’s what we think experience is really important. In fact and with experience you will learn how to categorize your clients! So you will be able to recognize the type of your client since the first meeting! And then avoid working for difficult-to-satisfy and constantly whining clients! If you turn down the project do it politely and you will save a lot of time, effort and money you were about to spend on a ‘risky’ project. If you walk away since the beginning chances are the client won’t start a “negative reputation campaign” about your company. The Market research, planning and benchmarking task (first point in this list) will help accurately target the right clients, and to know what clients can be problematic (without even meeting them).

5.    Work smart, make the right decisions and hire the right people

An important point to start with is to have a working/development/Project management methodology that is known and familiar for all the team members. Dispatch clear and discernible tasks for each one. Take the time to introduce this methodology to new staff members.
In order to succeed you must be able to sell your products! You may provide the best services but you won’t go too far if you are unable to sell them! Here again the first point I listed about Market research, benchmarking and planning will help you a lot.
To be an outstanding sales man you need to prepare yourself (along with your presentation support), to practice your speeches, to prepare for potential questions, to experience success and failure. Learn how to make a first contact with a prospect, how to introduce yourself and your company and when should you call or send a “thank you letter”. Be polite but show a lot of self confidence! Don’t let anyone ignore you or walk on you! Be positively persistent when it comes to selling or defending your services or your company. It is crucial that you learn from your mistakes! So if you don’t succeed in winning a contract or a project try to know why? And who was chosen to do the job? What did the other company have to offer that you didn’t have! Fix all the weaknesses you will find out along the way! Your purpose is to sell and make money! Same for your potential client, they want to make money too! So explain to them how by choosing your solution and buying it they will make more money from it. The best tactic to really achieve this is to make a research about each client, the nature of their business, their targeted audience, their business model, how they make money and so on. If you understand this you will make a better offer and be more convincing. Don’t seem too desperate to run after prospects! Your time and your reputation will suffer and so will you business! From time to time make special offers that only last for a short period of time. Include them in your proposal stating something like “If you order now; you will receive a free domain name and web space for one year!”
Once you start dragging work into your office, you and your team will have to achieve and concretize those projects using the well established work flow methodology we talked about earlier.
Being organized is vital. Create your own documentation for contact, pitching, and thanking clients. Create a template for your invoices, proposals, Fax covers etc… Keep a well maintained archive of everything. Create databases for clients, services providers, projects etc…
Another important tip is to NEVER accept Speculative Work! It is a pure waste of money and time and will probably cause many problems! I ‘committed’ this mistake when I first started (1999-2000) and it was a very bad experience all in all.
Don’t accept all the work you are offered! Make a choice don’t take any project that you won’t be able to dedicate the full attention it needs. Learn when and when to politely turn down some projects! Don’t be overwhelmed! This will degrade the quality of your services and in the end your loss will be bigger than your profit.
Be careful to the legal aspects of your company and pay attention to your contracts, leases and taxes. Pay every bill on time. Also don’t trust anyone! Don’t work without contracts! Don’t hire without contracts! Don’t give away your business secrets!
Another important side of your company is your staff! Choose the right person for the right position. When you hire a graphic/Web designer/ Developer degrees are important but you shouldn’t base your decision upon the degrees solely! Look at their portfolios and former experiences! That’s more relevant than degrees, in my opinion, for this kind of business. Also don’t hire someone with a negative pessimistic attitude or someone with low self-esteem or confidence! Even if they are talented! And trust your first impression! After all, your clients will judge your team according to their first impression about them. Make your staff accountable and assign clear tasks to every one of them!  Treat them well, be authoritarian without being too harsh, talk with them and motivate them. Be strict when it comes to work and in-house discipline and punctuality. Be a good example for them! Always come to work in time, be well dressed and polite and achieve your own tasks.
Another crucial point is to gather the money of your invoices on time. Yes, Pay your bills on time and get your own money in time. Make that clear to your clients both orally and in the written contracts. Ask for upfront percentage payments (at least 30%). Don’t act as if you don’t need that money (you know you will need it and you know you want it). If you act as if you don’t bother about receiving your checks chances are you won’t be paid.

6.    Create an evolving pricing scheme

Don’t just stab in the dark! Many Web agencies do so! If you want to succeed don’t follow them! The first point of this list recommended that you make some Market research, some planning and some benchmarking. If you did so then you have probably a good idea about how much should you charge? Don’t be the cheapest company around! As many people associate quality with the price! We started somewhere in the middle of the pricing scale that existed at the time in the area, then we charged more and more to become one of the most expensive companies around. You can’t be the most expensive company when you start as you have a lot less experience than the already established companies, you are also less known not to mention that you can charge as high as bigger companies that are not only older but also have a better qualified and more numerous staff. Once you are quite established start raising your prices! Be careful the quality of the services must be better too! Establish a well studied scheme for pricing and things should  work just ok!

7.    Create a professional collaboration Network

Remember point #2? You are a specialist! An expert you are not “the handy” company that delivers any services related to computers! You don’t provide services ranging from web design, to SEO, printing, copywriting and even maintaining PCs. But you can help your clients choose the right provider of such services. Yes! You can offer Consulting/Referring services about choosing another expert working in a contiguous field! We have done so very successfully! Indeed, as Web specialists we are, righteously, regarded as knowledgeable in related fields and we can help our clients either for free (as an extra) or for a certain fee.
We have recommended the services of other  Copywriting, translating, SEO, printing, hardware maintaining companies that we occasionally used for ourselves or companies that we’re confident in the quality of their services. Creating a network of specialist around us helped our business a lot. This was a financially profitable maneuver and something that helped building our reputation. Still we don’t provide those services in-house and we’re open about that with our clients. Creating such a network was essential to improve our own services for low costs (for free sometimes) through our partners that also recommended our services for their own clients.
In order to achieve good results with this tactic, you need to carefully use the ‘members’ of this network. Choose business partners that share with you many common points when it comes to work philosophy, goals, perspectives and business means.
Attend local industry meetings, symposia, conferences; join online networking and social websites to know other professionals. But the thing is, networking doesn’t stop there. Some of the best connections that you will make in life are through introductions. Don’t dither to introduce yourself and hand your business card here and there! Then be elective while choosing companies you will send your clients too! Study them, learn how they work, make some research about their processes and about their reputation, ask their clients (current and former ones) etc…

8.    Have a sparing economical attitude, Grow slowly & consider hiring Vs outsourcing

When you are just starting you should invest wisely! Only spend what you have to spend! Don’t rent a 1000m² office since day one, Don’t buy luxurious furniture for your office, don’t buy expensive equipment and PCs! You don’t need a MacBook air for now! Only get what you need! I started with a 120m² office, some second hand (yet good-looking, modern and refurbished) furniture, necessary computers (7 desktops and 2 laptops), a broadband connection, 2 telephones, a fax machine, 2 printers, A digital camera, a scanner and a coffee machine (essential). That’s all! I bought everything else later on (fridge, microwave, water cooler, other PCs…) when I had the money and the need to buy them! If you need a service try to have at the lowest prices (if not FREE). Having a collaboration network will help you later on (see point 7)! Don’t try to grow too fast! If you think you need more staffers just ask yourself will you have enough work all year long for these newly hired designers or developers? Or is it just a circumstantial work flow? If so why hire people to fire them a short time after? Instead of hiring you can alternatively Outsource to some other companies whether they are in your country or in an other country. Choose carefully the company you’re going to outsource the work to! Or you can just turn down some projects! After a while I was sure that I have (and will have) a ceaselessly increasing amount of work and I ended up hiring another full time Web developer. I also successfully outsourced some small projects (Tunisia, India, Romania) as we closely monitored the projects.
Matt Mickiewicz, the co-founder of the Australian giant SitePoint has some interesting thoughts about the matter: read his interview!

9.    Being passionate is not enough!

Being passionate about what you do is important but it is not enough! To be successful it takes a lot more than being merely passionate about your business. You must be passionate, knowledgeable, confident and fully devoted to what you do. This devotion must even haunt your dreams! You must see opportunities when they come! And to do so you must be always thinking about your business and how can you improve it! You will need to make some sacrifices! Such as occasionally not sleeping for one night or two, skipping parties, working during weekends, missing you favorite team crucial matches and so on! It is hard to be successful and it takes passion, persistence and dedication! Your core staff must be good and Savvy but also committed to your plans and to your philosophy! Otherwise that will drag you down! Accept advice from knowledgeable and successful people from your industry or outside your specialty! Success is a common concept for different and many businesses!
Focus on the goals you set before you start the whole company (point #1) and always keep the spotlight on them! If you fall get up! Be persistent and exhibit a positive optimistic attitude all the time! Starting a company is the easiest part, climbing to the top and being successful is a lot harder but remaining successful for a long time is the hardest part! So, again, don’t lose focus! Be enthusiastic, committed and “obsessed” about what you do and you shall remain at the top!

Photo by *sweetcaroline

10.    Don’t be satiated, Improve your skills and those of your staff and keep yourself updated

Now that you are established don’t get too comfortable! Update your site, modernize your services, brush up your skills, and make your logo trendier without completely changing it. Consider the flaws, imperfections and weaknesses you found about your company as a whole or some of your services and fix them! Listen carefully to the feedback of your clients and your website visitors and change what they don’t like! Read industry news; subscribe to RSS feeds of the top notch newspapers and blogs. Read books and articles, listen to podcasts, attend conferences and training courses, learn new techniques, and participate in discussion forums (SitePoint forums for instance). Push your team to do the same! The web design industry is always changing and moving and you should master all the cutting edges web knowledge to remain in the top.

I hope that this post will help you! All of the above are just starting points! Deepen your knowledge by taking the necessary time to understand each point and to make the required research about each detail. I would also recommend buying The Web Design Business Kit written by Brendon Sinclair and published by SitePoint. Let me know your thoughts or any other tips that helped you to be successful!
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