How I Changed My Business Model to Succeed Even During Tough Times

In 2015, I was a starving freelancer.

For the entire first year of my freelancing business, I was in this constant path of learning how to be a business owner (and still am to this day). There were times of struggle and times of celebration. All my entrepreneurial friends told me that it was always this way.

I remember landing a big client one month, only to lose that same client six months later. That one client accounted for a big chunk of my revenue and so I had to make adjustments out of fear like cutting back expenses where I could, not investing in my company like I should, and not going after opportunities where I usually would.

I also remember when I thought I needed to hire my first employee, but I decided against it because I was unsure of the future.

I was making decisions out of fear and making decisions based on the current situation as it stood.

So for the first year, I accepted that this was the fate of an entrepreneur.

But after a year of this constant struggle I thought, “there has to be a better way”.

I decided to make some changes that made sense to me, contrary to what others told me.

I told my friends about the changes I wanted to make in my business and they all thought I was crazy. Seriously. They told me I was nuts and that I would drive my business into the ground.

I did it anyway.

So here are the changes I made to my freelancing business that allowed me to scale to an entire agency team.

I decided to think like an actual business owner. Like my clients.

I got rid of long-term contracts

Here’s what didn’t make sense to me as a business owner. Why was I required to pay a long-term contract in an industry where a service is provided? It never made any sense to me. The same answer of “It locks them in as a client so you have a full year of revenue” was completely lame to me.

Think about it. If you provide a service, why not have the client stay with you because you provide great service? Makes sense, right?

Well, it did to me so I got rid of long-term contracts on everything. Everything became month-to-month. The reason is because I didn’t want a client paying me because a piece of paper said they had to.

Also, conversions went through the roof. It was just another hurdle that I removed to get a prospect to say yes!

I switched to a monthly recurring revenue model

This is by far the biggest key factor in my business. Instead of charging a one-time fee for a website design, I changed it to monthly.

Sure, I was charging a monthly hosting and maintenance fee after I launched a website, but it just didn’t make any sense to me to charge a client $3000-10,000 upfront (or even half upfront and half on the backend).

Do I have the cash to pay that upfront fee like I’m requesting from my clients? At the time, no I didn’t.

So I got rid of the upfront fee model and switched to monthly. I started pitching websites starting at $200/month. The first month was all it took to get started. Yes, this was a big risk since I didn’t require long-term contracts.

What happens if a client leaves me after three months and putting in 100 hours into a website?

What about those first months where I was putting in dozens of hours on a website and only getting paid $200/month for?

Well, those were risks I was willing to take. But do you know what happened?

Sales skyrocketed.

My conversion rates went through the roof because the barrier to entry was so much lower. All of a sudden, businesses who couldn’t afford to fork up thousands of dollars for a website but could pay a monthly fee were now clients!

The best thing about MRR is that it allowed me to plan accordingly. It was not uncommon for me to sign up five new website clients in a month at $200/mo each. Well, now I knew that I had $1,000/month coming in ongoing. And if I signed up another five the next month, that made it $2,000/month. See where I’m getting at?

This allowed me to plan for hiring and adding on to the team.

I pumped up my communication game

I had decided to survey all of my clients and friends who were business owners and entrepreneurs. I asked them what was the reason they left their previous website professional or web company.

The most common answer?

Communication.

So I dug deeper into what that meant. Every single one that shared this same answer said that it was not uncommon for a website professional to not return their email or call for days and sometimes even weeks.

This was insane to me. Why would us freelancers do this? Well, I never figured out the answer to that question but I decided that this was another hurdle to remove.

I implemented a 24-business-hour communication rule.

Whether it was email, phone call, text, Facebook message, Instagram DM, LinkedIn message, or even Snapchat, I always returned the message within 24-business hours. If it was something that would take me a couple days to figure out, I still responded saying that I was working on it.

The other way I pumped up the communication game is providing VERY clear expectations and full transparency on everything.

I did this from the early stages of onboarding a client, to well into their project. I am always realistic no matter what. If I was going to miss a deadline, I told them. I came to realize that most clients don’t mind that a deadline was not met as long as it was communicated to them prior to the deadline.

Communication. I swear THIS is the key to my high retention rate with my clients. My retention rate is 92%. It’s rare that a client leaves me and it’s the communication.

I offered unlimited support for no additional fee

This was something I received a lot of criticism for. It’s very common for an agency to charge hourly for any kind of changes that need to be made after a website is launched.

This creates a big problem on the client side.

If a client needs to request a change but knows that the web agency charges $100/hour, the client has no idea if it’s going to take an hour or 10 hours to complete, and, therefore, has no idea how much it’s going to cost.

This creates so much client anxiety that the client never makes any requests as a result. The web professional thinks everything is great because he or she never hears from the client, but in all reality the client has several changes to be made but doesn’t because of the anxiety and uncertainty.

This is more common than you think.

So I removed the anxiety hurdle and made it all-inclusive with unlimited content updates after a site is launched.

You might be thinking “what if I get a client that makes a crazy amount of requests?”

You solve that problem on the front end by pre-qualifying people and NOT selling to those that give off those red flags.

The reality is that my clients request one change per month on average. We’re talking about 10-15 minutes per client per month.

I started solving one problem by creating another…on purpose

In 2015, I started with just website design. This solved the problem of businesses needing a hub for their audiences to land online. Businesses needed a website and I built them. Problem solved.

Then I realized that it was creating a problem while solving another. The client didn’t know how to get people to the website. This offered an opportunity to cross-sell services.

I started offering SEO and it was an easy sales opportunity. After a while, I added social media, email marketing, and advertising to my arsenal of services.

It’s easier to sell to a current client than to obtain a brand new one.

I built a cash reserve (and didn’t touch it)

This is the simplest one on here but probably the most difficult to execute.

I do have to mention this because it has saved me a couple times in the past. This was one thing I had to purposefully do in my business. It’s easy as a freelancer to just take all the money you make and spend it as it comes.

I decided to take 10% of what I made and put it back until I reached a certain savings level. This amount of money should always be increasing as it needs to be six months worth of expenses in cash.

If your business is scaling, your expenses will increase. And therefore, your cash reserve needs to increase as well.

I hired a business coach

I actually didn’t hire one until my agency was making around $1 million in revenue. Up until then, I always thought “my business is doing well, so I don’t need a coach.”

I always viewed business coaches as the “cheerleader type” coaches because, frankly, those are the only ones I’ve met in person.

Until I met Shawn Dill.

I hired Shawn in spring of 2019 because I had finally realized what a business coach is meant to be. He offers advice for business situations that I have not experienced before. He’s not a cheerleader. If you need that type of person, go find a good friend.

He gave me guidance with unfamiliar business situations. For example, he guided me through the process of selling my agency in summer of 2019 and helped me with the negotiation.

In conclusion, by implementing these things in your freelancer business, whether you lose a big client, the economy plummets, or there’s just a change in market behavior, your business will be bulletproof to not just survive but to scale even in tough times.

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