Mike Arnesen

We’re living through a dark moment, unprecedented in our lifetimes. Each day brings a relentless flood of bad news: lives are lost, families and individuals are suffering, businesses are struggling and collapsing. Yet despite all of it, the days march on and we must find a way to live our lives and — if we’re fortunate enough to be able to do so — do our jobs. 

While keeping the metaphorical lights on is more than enough to keep me busy, it felt important to provide a transparent look at how UpBuild is navigating all this. So within this context, at this unique moment in history, what is UpBuild doing? 

UpBuild is existing. Hopefully that will count for something when this is all over. 

[Read more…] about UpBuild & COVID-19: Staying the Course in Uncertain Times

In what has become somewhat of a yearly tradition, I’m here today with some thoughts on what’s in store for UpBuild this year with a look back at the previous one. If you’re curious about what I wrote about last year, check out our 2018 Year in Review.

2019 Highlights

Before I discuss UpBuild’s path forward in 2020, I’d like to look back on some of the company’s highlights from 2019. 

2019 was a great year. 

At UpBuild’s company retreat one year ago, I called 2019 “The Year of Stability”. A year in which we’d keep our headcount the same, hold off on making any big moves, and just work on perfecting being a ten-person company. The goal was to spend 2019 becoming the best possible version of this UpBuild that we possibly could. We absolutely accomplished that.  

A few achievements that spring to mind include the following.

Exceeding One Million in Gross Revenue

To be needlessly precise, UpBuild’s total receipts for 2019 came to $1,051,719.63. While in reality, crossing the million-dollar threshold is a completely arbitrary thing to set a goal around, it’s an exciting and personally fulfilling milestone. Also, as someone who still has a bit of a chip on the shoulder from someone referring to UpBuild — in its infancy — as “Mike’s ‘agency’ ” (“agency”, in deprecating quotation marks), it feels validating to see us reach this point. 

Of course, the more important financial metric is the percentage by which we grew the agency’s revenue. In 2019, we grew revenue by 17% compared to 2018 while our total expenses fell by about 1.5%. 

Our profitability for the year came in at 24%, which was a huge step up from last year’s 13%. The reason? For one, our team hit capacity more than a few times (so much so that we temporarily stopped taking on clients). Additionally, while we remained a ten-person company, we effectively swapped out a completely non-billable person (see more on that in our Operations Manager Protocol section below) for a very-billable fifth Senior Marketing Strategist. 

Retained and Rewarded the Team*

UpBuild is all about sustainability because we’re in this for the long-haul. Beyond our own self-interest, clients love when the people they’ve worked with stay around (i.e., they don’t particularly find value in, or get jazzed about, employee turnover). As such, retaining and continuing to reward our team (e.g., salary increases, more benefits, promotions) is not only an accomplishment but a big step forward for UpBuild’s product. That’s the team. 

The reason for the asterisk above is that we retained nearly our whole team; our Operations Manager resigned! While we want to be the best place in the world for self-motivated technical marketers to work, we acknowledge that not everyone will view this as the best place for them over the long term. Ryan was an amazing and integral part of our team for over a year, but I’ll freely admit that managing the business operations and HR for a smaller agency that is deliberately not growing doesn’t necessarily make for an exciting long-term challenge. Ryan’s tour of duty here revolutionized how we operate and taught us some incredibly valuable things, one of which being that we don’t need an Operations Manager (at least, not anymore, thanks in large part to Ryan’s work while he was here). See below for more. 

Developed an Operations Manager Protocol

As Ryan wrapped up his time with UpBuild, he and I invested a lot of time and effort into getting all the knowledge and operational savvy out of his brain and into a defined system. The result was a living document we’ve come to refer to as the Operations Manager Protocol (the OMP). Within this Google Doc is everything needed to keep the UpBuild ship afloat with an important caveat — the instructions and processes laid out therein are specific enough that anyone can manage and/or execute any (or all) aspect(s) of UpBuild’s operations. I’d rather it never come to that, but if it should come to pass that UpBuild’s Leadership Team inexplicably disappears, the comprehensive guide to keeping the lights on is available to anyone on the team. 

Nearly a year after Ryan’s departure from the company, we’re supporting ten team members with a completely decentralized operations system. Duties are split between members of UpBuild’s Leadership Team (Hi, Ruth and Laura) and a team of virtual assistants (Hey, Leverage!). While there were, and will undoubtedly continue to be, some small hiccups here and there, this approach feels incredibly efficient and very UpBuildy. As an added bonus, I feel confident that should the need arise nearly anyone on the UpBuild team could grab the wheel and keep our operations running smoothly (at least reasonably so). 

Aside: It’s been brought to my attention that the OMP might not be as clear as I like to think it is. Did I mention it’s a living document? I’m stoked to revisit it now!

We went to MozCon and Disney World! 

Another highlight (possibly the most fun highlight of them all) is that the UpBuild team got to take a few field trips in 2019!

While we make a point to send every team member to at least one industry event (e.g., an SEO conference) each year, this was the first time we were able to get all the pieces in place (logistically and financially) to send all our team members to the same conference — MozCon! We had a blast hanging out, networking, and learning together. Plus we got to grab an amazing team dinner one night, as well as capturing an elusive collocated team picture to prove we’re not all bots. 

Even more exciting, we took the team to Disney World (Epcot, specifically, which is the best WDW park. Come at me.). We also had a great company retreat the day before that, so I guess you could say that was the primary business reason for the trip, but spending a day together at the Happiest Place on Earth was way too much fun. 

We Did Great Work That We Were Proud Of

The whole reason that UpBuild exists is so that technical marketing geeks can do work that they’re proud of. I’m happy to say that we did that across the board in 2019. As a result, we performed extremely well in terms of client satisfaction and retention. That’s not to say that we didn’t lose any clients or that we were able to grow X accounts by Y%. That’s not really something we worry about; in fact, a mantra around here is that we will lose every client, and lose clients we did. 

The key difference this year is that there were (by my estimation) no surprises in that area. Based on what we were able to learn and incorporate into our client strategy approach over the last few years, we served all our clients incredibly well, and every client that we parted ways with did so at a natural and mutually-agreeable stopping point. Either we accomplished our shared goals, their company achieved their goal (e.g., of getting acquired), or we hit a point at which they became self-sufficient and just didn’t need what we offered anymore.

In each year past, we’ve had at least a few surprise cancellations that we didn’t see coming or have had those “we need to talk” emails that come in on a Friday afternoon. This evaluation isn’t a pass-fail in which having those things happen would mean we weren’t a good company in a given year, but what happened in 2019 underscores how far we’ve come and just how much we’ve learned since 2015. 

I Took Parental Leave

This highlight could easily be a standalone blog post, so I’ll attempt to keep this brief. TL;DR — my wife and I welcomed a baby girl in mid-October, and immediately following her birth I took twelve weeks off. Like, completely off. I signed out of email, logged out of Twitter, and turned off my work phone for nearly three months. 

This stands in marked contrast to my direct experience with CEOs I’ve worked for (all fathers). The longest I’d ever seen someone in the C Suite take away from work was two weeks. The standard line of thought was, “I’m very important and I can’t afford to take more than a week or two off”. 

Now, don’t get me wrong, that may very well be true for those people. I’m in no position to judge what’s right or required for them. For me, however, I thought it was extremely important for a multitude of reasons to take a risk and completely step away from my business for twelve weeks and just…learn how to be a dad. 

When I took the leap and started my own company five years ago, I was motivated in large part by the desire to try to build the life I wanted to live. Being able to have a family and take this kind of time away is a big part of the life I sought to build for myself. Furthermore, when Ruth took the lead on building our Parental Leave Policy in 2016, I knew a huge part of its success would be showing the larger team through action that we truly believed in it and stood behind it. A key aspect of the policy is that all parents get to take leave and that “leave is leave”. As the second member of the UpBuild team to welcome a new little one while working here, how badly would I have undercut this policy by only taking a week or two off? For UpBuild to be successful, nothing that we claim we believe can be simple lip service. We have to walk the walk. 

And so I walked that walk for twelve weeks, and it’s the best work-related decision I’ve ever made. I’ll admit that it was anxiety-inducing to completely shut down the home office for that long, but I had prepared for the moment for the better part of a year (I suppose you could say I’ve been preparing since Day One of UpBuild). Thanks to this incredible team, the leadership group here, and assets we’ve built like the Operations Manager protocol, everything continued on as normal while I was out. As a result, I came back at the beginning of January more motivated and refreshed than ever. 

Overall

I knew that 2019 was a great year for us, but exploring everything in writing shines a light on just how incredible it was. I’m so proud of everything we’ve accomplished and I’m endlessly grateful to get to do all of this with the team here. 

UpBuild in the Year 2020

Now that 2019 is in the rearview mirror, allow me to share a few priorities and changes that will be front and center for us in 2020. 

Narrowing Focus

Picking our battles is in everyone’s best interest

We’ve had a good idea of who our ideal client was for some time now, but the back half of 2019 really served to solidify who we should be serving. The refinement of our ideal client isn’t about capitalizing on a growing market or industry. I can’t say it’s about “finding our niche”. It certainly isn’t about maximizing profits. It’s about picking our battles in such a way that we can set our team up for success and make sure that the clients we take on are ones we can do exceptional work for. 

While the “ideal client” description below was developed last year, we’ve learned through trial and error just how accurate it is and just how important it is to adhere to it. This isn’t to say that we’ll never again take on a client who doesn’t fit this description, but with rare exceptions, each time we’ve veered noticeably away from this focus, we’ve come up against considerable challenges. 

Put simply (and a little tongue-in-cheek), UpBuild’s ideal client is the client we can get awesome results for. Since the success of a consulting engagement almost always boils down to who you’re partnered with (the stakeholder), our ideal stakeholder is a person whose work-life we can make markedly better by doing what we’re best at: highly-engaged and collaborative technical marketing.

Beyond the individual hiring us, we’ve found that we work best with B2B SaaS startups and mid-sized consumer brands. 

For B2B SaaS startups, it’s typically companies at the Series A or Series B stage. Post-seed money is okay, too, but pre-seed just isn’t a good fit; it’s pretty clear that early-stage startups should be conservative with their SEO budget in their early days and we’re heavy hitters that they don’t yet need. By contrast, B2B SaaS companies at the Series A or B stage actually need an SEO Manager or Director of Optimization, but almost without exception aren’t able to find (or take the time to slow down to find) the right person. By giving them a vetted, senior SEO strategist at 40-50 hours a month, we’re quite literally the next best thing. 

When it comes to mid-sized consumer brands, we’re talking about B2C companies that are already established and profitable. They’re well-known to at least their core demographic and this gives our team some amazing raw material to work with. Those companies may have their own in-house SEO, but many don’t and they certainly should. We love to fill that gap and we’re exceptionally good at it. 

Overall, we do our best work when we have 40-50 hours per month and at least 4 months to really build momentum and ensure that ROI manifests quickly. Throughout 2019 (and in the years preceding), we found that going upmarket in an effort to work with bigger companies isn’t the best move for us — we’re not able to give them what they need and we’re often not equipped to make headway within those larger organizations. On the other end of the spectrum, we’re usually not a great fit for smaller startups, publishers, or other agencies — we can revolutionize their SEO, but the results typically aren’t sufficient to generate a truly exceptional return on their investments with us. 

In 2020, we’re really doubling down on the fundamental truth that what UpBuild offers is less akin to “SEO services” that you can set and forget, and more akin to giving companies an SEO Manager (or even a Director of SEO) on their team. At the end of the day, bringing on UpBuild as a partner is like hiring another person for an in-house marketing team, and we want to focus more on attracting the clients who need that while bowing out of consideration with humility when a prospective client might be better served somewhere else. 

Oh, and we still don’t have full-time salespeople and we still vote on every client. 

Rates & Pricing 

As value delivered increases, so too should pricing. 

As we enter 2020, UpBuild is no longer a loose collection of talented marketing strategists doing their very best to serve their clients; we’re a dialed-in machine. Over the last five years, we’ve built on our strengths, learned from our mistakes, discovered new approaches, and optimized how we work collectively as a team. I firmly believe that the UpBuild team is greater than the sum of its parts, and that statement has never been truer than in 2020. 

As a result, we’re providing our clients with more sophisticated SEO, deeper analytics insights, better results, and more overall value than we ever have before. As such it’s only logical that what we charge increases in a similar way. 

Where’s the extra money going to go? Into the product, as always. The “product” being the team. In order to continue fulfilling our objective and realizing our vision, we need to be able to reward our team members with salary increases, better benefits, promotions, and more. Also, company-wide meetups get more expensive every time the team grows, so we have to account for that, too. 

This is, of course, something I view as a virtuous cycle. We deliver more value to our clients than we’ve ever been able to before, we then command a higher investment from them, and we use that to build up (i.e., upbuild [verb]) our team, which then creates the conditions in which they can deliver even more value and return on investment. 

Efficiency 

We’re optimizing for impact-per-hour.

Another initiative that we intend to work on this year is efficiency. Specifically, how can all of us at UpBuild make every hour we spend in the virtual office really count? How can we maximize the value, results, or impact we generate with our work? How can we get the most out of every keystroke?

Sure, it’s easy to say we’re trying to become more efficient, but what does that translate to in real life? I think it means starting with the inverse and looking at our inefficiencies to uncover what’s slowing the team down and getting in their way. My goal is to ask:

• What recurring tasks can we automate or systematize and free up team member’s time? 
• What daily, weekly, or monthly tasks and reminders can we pull out of team member’s brains and put into a reminder or todo system to free up mental bandwidth?
• Could virtual assistants help the team by allowing them to offload certain tasks? 
• Could we leverage productivity experts to develop individualized recommendations to suit everyone’s individual work style?
• Should everyone at UpBuild give up QWERTY for Dvorak? 😉

Beyond that, we’re also taking a hard look at our expenses and budgeting this year (with the help of a third-party CFO) and making sure that we’re being efficient in our finances as well. 

There are no obvious or clear answers here. That’s why it’ll be a respectable challenge and that’s precisely why I’m really excited to work on it. 

Growing the Team

Adding more minds is not just additive; it’s a multiplier. 

It was this time last year that I reported that “we’re not growing” in 2019. We elected to focus on stability rather than growth (“The Year of Stability”, it was dubbed). Our goal was to perfect being a ten-person company. Call me crazy, but I think we did that. I think we’re the best version of UpBuild at ten people that we could possibly be. 

I’ve never been of the mind that growing headcount equates to, or even correlates all that strongly with, success. However, I have come to find over the last five years that having more minds in the mix doesn’t just add to our team’s capabilities; each new brain that’s introduced to the hive mind is a multiplier on our collective ability. Now that we’ve achieved stability and arguably become great at operating as a ten-person company, I find it much more likely than not that we’ll hire two, three, or even more people this year. Our challenge and charge throughout the year will be to ensure that we don’t turn into a generic “big agency”, but that we become a better UpBuild. That means maintaining our thoughtful, deliberate, and values-driven culture. That means that we can’t ever use our growth as a justification for non-ideal outcomes (e.g., “The team feels like they’re not as interconnected at fifteen people as they did at ten, but hey, we’re scaling up!”).

Beyond all that, growth doesn’t simply mean “more bodies”. Retaining and promoting (see the 2019 highlights) existing team members is also a kind of growth. Arguably a better kind of growth. Keeping the great people from our present-day team here, engaged, and rewarded is going to be not only a good thing but a key strategy in scaling up. Bringing in more minds is only a multiplier when those minds are being melded into a healthy, functional core group. 

Wrapping Up

2019 was a great year for us and I truly believe 2020 will be even better. This year — the Year of Efficiency at Scale — is about optimizing how we work, how we operate, and how we leverage all of our lessons learned in order to multiply our team’s collective ability. It’s going to be a great year.

Until next time, happy optimizing!

For the last two weeks, I’ve been sending emails to prospective UpBuild clients to let them know we’re not going to work with them. Well, at least not for another month or two. Why? Because our team is at capacity and asking a business to pay us money for technical marketing consulting when we’re not able to service them to the absolute best of our ability is wrong. Is that a polarizing statement? It shouldn’t be.

In my experience, it’s essentially a coin toss as to whether or not this will cause us to lose the opportunity to get a client’s business. I’m more than okay with that. I’m honestly proud of it.

In this post, I’d like to explain why UpBuild turns clients away or puts them on a waiting list rather than trying — as most other agencies would — to make the sale and continue growing the business.

How Did It Come to This?

In my agency experience prior to founding UpBuild, it was not uncommon for me to find myself with upwards of 20 clients in my care. That’s 20 businesses whose SEO I was responsible for. You can already see where this is going, right?

[Read more…] about Hitting Capacity: When UpBuild’s Cup Runneth Over