Episode 139

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Every agency has an internal culture. The only question is – did you build it on purpose. Intentionality. That is the bottom line. If you want to consciously create your team’s functionality and effectiveness, what kind of clients you attract, and where your own focus should be – that takes intentionality. That level of thinking has helped Raman Sehgal build an agency that allows him to work with clients from all over the world and enjoy a staff retention rate of 80%.

Raman Sehgal is the owner of a UK-based marketing agency called Ramarketing, an award-winning, creative, digital and PR agency. They are in the business of helping fast-growing companies in the life science, pharma, and manufacturing sectors get noticed.

Nine years ago, he was working from a desk in his home. His agency has now grown the agency to a staff of over 20 and they working with clients across the UK, the US, and Europe, and still have the very first client that they landed almost a decade ago.

 

 

What you’ll learn about in this episode:

  • What it looks like to go from freelancer to running an agency
  • How the job of owner changes over the lifecycle of an agency
  • Why it’s possible to run an agency from a kitchen counter or a big corporate office
  • How most agency owners become accidental business owners
  • How Raman’s agency model compares to how a traditional agency runs
  • How to build a family first, work second culture in your business
  • What it takes to serve clients in multiple markets around the globe
  • The power of being “meaningfully specific” in an agency
  • Raman’s agency billing structure and the difference between billing by the hour for the US compared to the UK
  • Building a fee structure on deliverables
  • The correlation between giving clients a good return and the margin you receive on your work
  • The red flags you can use to vet prospects and make sure they are a good fit for your agency
  • How trying to make a difficult client happy can actually cost you and your staff
  • Best practices to keep your team productive

The Golden Nuggets:

“My job now is very different than when I started nine years ago. I’m sure all agency owners can attest to that. It’s part of the journey.” – @ramanelli Click To Tweet “Certain prospective clients will come to us, and we'll recognize very quickly that we are not the right fit for them.” – @ramanelli Click To Tweet “There are lots of ways to run an agency, but I’ve found there’s nothing better than being in a room with people.” – @ramanelli Click To Tweet “Turnover and burnout are very common in agencies. I worked hard on our culture, so we keep our best and brightest.” – @ramanelli Click To Tweet “Clients don’t care how much time we put into a project. We don’t even talk about time. We bill based on deliverables and outcomes.” – @ramanelli Click To Tweet

“We have a rule – no internal or external meetings before 11:00 – the morning is for focusing on bigger tasks.” – @ramanelli Click To Tweet

 

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We’re proud to announce that Hubspot is now the presenting sponsor of the Build A Better Agency podcast! Many thanks to them for their support!

Speaker 1:

If you’re going to take the risk of running an agency, shouldn’t you get the benefits too? Welcome to Agency Management Institute’s Build a Better Agency Podcast, presented by HubSpot. We’ll show you how to build an agency that can scale, and grow, with better clients, invested employees, and best of all, more money to the bottom line. Bringing his 25 plus years of experience as both an agency owner, and agency consultant, please welcome your host, Drew McLellan.

Drew McLellan:

Hey there. And welcome to another episode of Build a Better Agency. This is Drew McLellan, and I am here with another guest to help you think a little differently about your agency. And today we’re going to talk about everything from niching, to scaling, to productivity. It’s going to be a lively conversation, I think there’s going to be a lot of takeaways for you. So, buckle in, this is going to be a great hour. So let me tell you a little bit about my guests. So Raman Sehgal is actually the owner of a UK based marketing agency called Ramarketing, which is a award-winning creative, digital and PR agency that is in the business of helping fast growing companies in the life science, pharma and manufacturing sectors get noticed.

Now, they sound quite impressive and they are, but they started off in a very different place. It actually started with Raman in his bedroom, basically in his spare room, and he started in ’09, and has now grown the agency to be over 20 folks, and they are working today with clients across the UK, the US, and Europe, and their very first client that they secured is still with them today.

And Raman’s mission is really an interesting one that we’re going to dig into, which is, his goal is to do things differently, to build an agency that does not operate with the traditional agency model, so we’re going to find out what that model looks like today. One that creates and delivers world-class work that gets clients noticed, creates value, revenue, wealth, and employment.

Away from the office, he is a blogger, a speaker, a guest columnist, and occasionally a lecturer at the universities, and is covered in many trade publications in their niche industries, and was also recently named one of the Journal’s 35 under 35 rising stars in business, and in 2016 was a finalist for the Entrepreneurs Forum Emerging Talent Award. So Raman, welcome to the podcast. Thanks for joining us.

Raman Sehgal:

Thanks Drew.

Drew McLellan:

So let’s start with, what prompted you to decide that you wanted to hang up a shingle, and start an agency to begin with?

Raman Sehgal:

Well, it wasn’t that straight forward as you can imagine [crosstalk 00:02:37].

Drew McLellan:

It never is, is it? Yeah.

Raman Sehgal:

So I used to work for a pharmaceutical company back in 2008, 2009 and it was two parts to the business, and one business was sold, and I went to effectively work for the other side of the company that was still retained by the same owners. And the bit that was sold, they asked me if I would do their PR, if you like, manage their PR activities, trade PR activities in my spare time, and I thought, “Hey, that sounds great. I can work a weekend day, I’ll work an evening or two and make an extra few bucks.” And that was about as much strategy that went into the creation of my agency. It was a means-

Drew McLellan:

That is many agency’s origin story. “Something weird happened, I said, why not, and all of a sudden shoot, I own an agency.”

Raman Sehgal:

Yeah. That’s exactly what it was. And it was quite a… For the first couple of years it was very much myself, and then as I started to get a couple more clients, and I was still working full time, and then about four days, and then three days, so I was balancing if you like, the consultancy side of things with my day job, and then started using a couple of contractors, and the kind of… In 2011, my employer at the time, so the same company that allowed me to do this, said, “Hey, you’re on to something here. We’re going to ask you to leave, not in a negative way. We’re going to give you your wage effectively as a consultancy agency client.”

So, they were incredibly kind, and they could see that I had something interesting to offer the market, and I was very fortunate that they became a client, as opposed to my employer. And that was in 2011, and that’s when the real journey started, I think is from solo agency, or solo freelancer to agency owner.

Drew McLellan:

So, what was the first sort of aha moment for you, when you shifted from being a freelancer, to really starting to launch, and run an agency? What were the surprises early on, that you learned from?

Raman Sehgal:

I think that’s a great question, and I actually think one of the, I suppose things I’ve seen a lot of young agency owners, or freelancers, much like myself when I saw it, was thinking that you know everything best.

Drew McLellan:

Right.

Raman Sehgal:

And actually, what really was a learning to me was getting people who are much better than me at specific skills. So, for instance, my background is in B2B marketing, and PR, so getting someone who was strong on consumer PR, or someone who was strong on SEO, or knew their way around an AdWords campaign. This is going back in 2010, 2011 time where there wasn’t many companies like us around, certainly not in where we are, based in the UK. And I think that was a real surprise to me, that actually recognizing you shouldn’t be doing everything yourself.

Drew McLellan:

Yeah.

Raman Sehgal:

And I think most agency owners, even I still today wear multiple hats, and that’s fine. But, as time has gone by, some of these hats disappear, and you end up doing… My job now is really different to what it was eight, nine years ago, and there’s constant surprises along the way, which I imagine most agency owners like me can kind of verify that that tends to be the journey.

Drew McLellan:

Well, I think for most agency owners, when you start, you’re sort of the chief bottle washer, emptying the garbage, serving the clients, and then at night, doing all the administrative things, the billing, and the HR, and all of those sorts of things. And as you start adding bodies, you’re able to compartmentalize where your time should be spent in a different way. So, I think you’re absolutely right about that.

But, in the bio, in the intro, I talked about the fact that your vision was to create an agency that was not typical in its structure. So, what was it about a typical agency structure that didn’t appeal to you? And what did you, and do you believe, is a better structure? Help us understand the variance in how you work, in terms of bodies, or process, compared to how a traditional agency might function?

Raman Sehgal:

Yeah, absolutely. And certainly, in the early days, we were very much an associate kind of business model. So, for three or four years, we ran effectively, as a group of a few employees, but actually, lots of freelancers effectively, that were actually treated as part of the team, as staff, and almost given the same perks to an extent of being a guaranteed income, and that type of thing. And what that allowed us to do was scale, without adding all of the overhead.

Drew McLellan:

Yeah.

Raman Sehgal:

You often see smaller agencies where they’ll add bodies, they’ll add lots of bodies very quickly, and all it takes is to lose one or two clients, which is very likely in the early days, to then hit a cashflow problem, and that type of thing. So, our model was very much with matching the client needs, with the expertise in the team, and that’s something that we still do today, which is part of our makeup, which is making sure, and that’s kind of how we ended up doing specific expertise is, we have ready made experts to go on specific types of clients. So, certain clients will come to us, and prospects will come to us, and we’ll recognize very quickly that we are not the right fit for them, and we won’t try and force that fit.

There was a time where, which were growing very quickly, and we were forcing the fit, if you like, and we kind of lost our way a little bit. But, I think that happens with most agency journeys, but certainly the bit that was really interesting for us, and that kind of bit of difference was not having a huge overhead, and being able to offer relevant expertise for relevant clients, and it was right in the middle of recession when we started as well. So, in 2010, 2011 time was a tight time for most companies. And the other thing that we did, we didn’t have an office for the first few years. So, we kept our overhead down even more, and it allowed us to be very competitive with our offerings.

Drew McLellan:

And did you find that clients or prospects were bothered by the fact that you didn’t have a physical presence? Did you tell them? And if so, how did you explain that?

Raman Sehgal:

So in the early days, not at all, I think because the nature of the clients were after very specific expertise, and they didn’t care whether you were in working out of the bedroom, or anything else. I think where we added our office in 2012, or 2013, offices, and actually, the switch came when you’re getting to work with bigger companies, and bigger clients, and the question is, “So where are you based, and how many staff do you have?” And certainly for us, we couldn’t… We didn’t have the infrastructure, and we didn’t have the collaboration in place by not having the office. I mean, there was fantastic tools around like Google Hangouts and things like that, but there’s nothing better than being in the same room with people to collaborate.

Drew McLellan:

Absolutely, right.

Raman Sehgal:

When you’re developing a PR campaign, or a creative campaign, and that type of thing, and I think for us, it was just, as we were growing as an agency, where we’re notching up working with bigger clients, and different types of clients. So, having a physical space, and having multiple disciplines, so PR, creative, and design kind of under one roof, that became more, and more important. And I think, for the people working for us, it felt more real as well. It didn’t feel like working at home, on a laptop or whatever. It felt like, “Oh, wow. We’ve [crosstalk 00:10:53].”

Drew McLellan:

You’ve grown up, yeah.

Raman Sehgal:

Yeah, it feels like a proper business now. And that’s part of the journey I’ve personally been on, where, I mean, you’ll think I’m being daft, but up until we moved to a bigger office, the one I’m in right now, and I remember, my wife walked in about, we moved in, in March earlier this year, my wife walked in, and she went, “Oh, my God, you’ve actually got a proper company.” And there was this realization of, it’s like eight years down the line that we both kind of had that feeling of, “Oh, my God, this thing’s real, and there are 20 people here.” And all that type of thing.

And it’s hilarious, you go on this journey, and without even realizing, you arrive in a place that… The journey’s so fast that you rarely stop and think. “Wow.” And [inaudible 00:11:39] I was saying to my staff, one of the first days you arrived in this office, I was sat having lunch at one of the desks, looking out the window, and I turned to one of them and I said, “I felt like I’d just started working at a new agency.” And I was like, “Well, this is a cool company to work for.” It was just a bizarre situation, where it never felt… It stopped feeling like it’s like someone else’s company, and not mine, which is quite an interesting situation.

Drew McLellan:

Yeah, I think a lot of agency owners are accidental business owners, where it happens exactly the way it happened for you, which is an opportunity presented itself, you start doing some work on the side, you need some help, so you reach out to somebody that you know, that has some expertise.

And all of a sudden, in a blink, or five years, or however long that takes, now you’re running an agency of five, or 10, or 15, or 20 people, and it has an all different set of requirements that are all… It sounds ridiculous, but kind of come up by surprise, because you’re moving so fast, and you’re juggling so many balls that you don’t really take a lot of time to reflect on where you’re headed, or the consequences of where you’re headed. And then all of a sudden, boom, you’re there. And it’s like, “Shoot, I’ve got to figure all this out.” So how are you structured today? And how is it different than a traditional agency? Or are you today a very traditional agency in terms of structure?

Raman Sehgal:

Yeah, I mean, there’s an irony in it, actually, because we are, it’s quite interesting, because we are moving more towards what we set out never to be actually, in a sense, because we… And I think it’s just we’re dictated by our clients, and were dictated by our market, and actually having infrastructure in place, and having operating systems and processes, and a clear vision for the businesses is just part of growing up in the market that we operate in.

I suppose, where we still differentiate in lots of senses is both in terms of sector specific expertise, and obviously, in the culture of our business as well. And we’ve always been big on, like, we were on day one, we have on our wall, “Family first, work second,” and we’re big on making sure people don’t just work 12 hour days, and kind of work themselves to the bone, because burnout is very common in agencies, and we’ve tried really hard to avoid that, and allow people to keep perspective of what we’re doing, and build a really positive culture here.

And I think we have a staff retention rate of about 80%. We very, very rarely lose people out of our team, which as you know, is one of the biggest challenges in running an agency, and running any business. So, I think developing that, retaining and maintaining that culture, and keeping our key staff, and adding people to the team without upsetting the applecart has been something we’ve managed to do, that’s allowed us to just sustainably grow the business, and reach into new markets.

Drew McLellan:

So, I think one of the things that listeners are probably thinking about is, there are a lot of agencies that are 20 or so staff people, and they’re basically a local, or a regional agency, they can break out of even their state, or their region, let alone break out into other countries. So, how does an agency of 20 people serve clients across the UK, and the US, and the rest of Europe? How does that happen at your size, for, like I said, because many agencies, they are having a hard time breaking out of their city?

Raman Sehgal:

Sure. Yeah. I mean, absolutely, we are very unusual in that sense. And I think, for me, it all starts with having… There’s a great phrase that Seth Godin uses, which has been meaningfully specific, and I absolutely adore that phrase, because with our business, we are meaningfully specific to a relatively small audience, in the kind of global pharmaceutical life sciences sector. So, the sector is worth, say $100 billion globally, so it’s a huge sector, and it’s a very global sector, but that’s our market, on the whole, predominantly, we work in that market. So, that’s allowed us to look well beyond our region, and even our nation, and develop business all over the world.

So, two of our largest clients are on the East Coast in the States, and I think we have clients in about 10, or 11 cities in Europe, as well. And we just today had a meeting with a company who, a representative was here from a company in China as well. And it’s all very much based on having a niche specialism, and that, to be honest with you, has probably been the driver behind the growth in our business. We did, for three or four years, we had clients in all kinds of sectors, and tried to do multiple clients, and multiple sectors, and found it kind of felt like a merry go round, in that we were growing, but we kept on losing clients as quickly as we could gain them.

Drew McLellan:

Yeah.

Raman Sehgal:

Whereas what now we’ve got, certainly in the last 18 months or so, while we really, ironically, focused actually where we started, the first three or four clients of our business were in the pharmaceutical life science space, and we have 40 plus now in this space alone, and it’s just given us that clarity, in terms of how we market ourselves, how we speak to our audience, what events we go to, who do we recruit, and all these types of things. It’s certainly given us real clarity in that sense, of where we’re going as a business.

Drew McLellan:

So, there are lots of US based pharma agencies, so what is it that you do that would… And what kind of conversation do you have with a prospect who is out of your market? So, either in another European country, or even more so in the States, what does that conversation look like that makes you the right choice over a pharma agency that is geographically much more close? So they’re niche just like you are, and they’re physically closer, so what does the conversation look like, as you’re discussing with the client? Because I have to think they ask. How do you justify that? Or what is it about what you do, or how you do it, that makes them go, “Forget the pharma agency in New York, or Philly, or wherever, let’s go with these guys over in the UK?”

Raman Sehgal:

Yeah, I mean, that’s a really interesting question, and one of the things that we found is that it’s one of the things I was keen to also chat about, is understanding the kind of nuances of your audience, and something that we found was a real quirk in the system, in the pharmaceutical, or the life science sector was, you have a lot of US agencies that are very strong in the US, but you have very few, apart from, I suppose the big, big global guys have got offices all over the world, but there’s very few that know the European market in our sector. So actually, our US clients, our [inaudible 00:19:05] three or four of them that we have is predominantly, “Can you guys make us famous in Europe?”

Drew McLellan:

Got it.

Raman