Two Years of UpBuild: Then, Now, and Lessons Learned in Between

Happy birthday to UpBuild! We’re 2 years old today. To commemorate the occasion, I wanted to reflect on how things have gone, the ways in which the company has evolved, and what we’ve learned along the way.

It only makes sense to start with the beginning.

Then

On the morning of May 1st, 2015, I logged into my Dreamhost admin panel, hunted for a specific domain name I’d purchased about a year prior, and clicked one the WordPress one-click install. Less than 15 minutes later…bam! This thing was real.

It’s interesting to note that up until that point, I hadn’t imagined that UpBuild would be…this. My initial vision was that UpBuild would be a SaaS product for managing team development — tracking 1:1s, working toward shared goals, celebrating professional milestones, and providing analytics on team member happiness. The idea was actually inspired by software that my wife used as a child and family therapist. Yeah, the software itself was kind of a nightmare but the principles of outcome-focused case management were super impressive to me.

Just in case I need to make it absolutely clear that my first draft of anything is always super embarrassing, hold onto your butts. I found this buried in my Dropbox, it’s from June of 2014. Just under a year prior to my founding the UpBuild that people know today.

“upBuild”, the SaaS product

The “product” never made it beyond the “Mike is clearly not a designer” mock-up stage, but I did end up buying up-build.com (upbuild.com was taken and it wasn’t until May 5th, 2015 that I’d decide to go down the .io road).

When I decided to start doing my own consulting, UpBuild seemed like a great choice; a few close colleagues from SwellPath and the larger industry had suggested calling the company “The Arnesen Method”1 2 (I think it was Aaron Bradley who coined that), but I didn’t think my ego was big enough to support that branding. Haha. So, UpBuild it was.

While I’d started talking to potential clients in late April (UpBuild’s first sales meeting was on April 29th), the first day of paid work landed right on May 1st. I had spent the last three weeks contemplating whether or not I had the guts to do this thing, but now I was getting paid for it and there was a check coming in the mail(!!!) with “Pay to the order of UpBuild” on it instead of my name.

I pretty much had to be all in at that point.

A few days earlier, I had found a lawyer through Thumbtack and he helped me file UpBuild’s articles of organization (and David‘s still our lawyer to this day). 

With that check on the way I needed a bank account, stat, but the paperwork was still en route to Salem, OR for processing. Through some stroke of luck, OnPoint Community Credit Union let me open a provisional business bank account (so I could deposit checks made out to UpBuild), but they let me know that if they didn’t receive confirmation from the state (that I was legit) within a few weeks they’d have to close the account. My first company purchase was Screaming Frog. Best £99 I ever spent.

 

 

From that point forward everything went way better than expected, over and over again. You will never meet a more devout subscriber to the idea of Manufacturing Serendipity. With every unexpected email from a lead starting with “I saw you speak at…”, or “You helped me on Twitter…”, or “I used to read your blog posts when I was at an agency and now I’m in-house…”, I became more and more aware that all of it was tied back to helping people (either directly or indirectly) at times when I had no clue that I’d ever get something in return.

Pretty soon I had four clients that were all the result of said serendipity.

My time as a strict solopreneur was not long; I got lonely (and busy) and started reaching out to build my team on May 7th. If you count the three weeks that I’d spent “in between opportunities”, I’d gone almost a full month without having anyone to tell lame SEO jokes to. That clearly needed to change, so I started to build out my dream team (easier said than done, of course).

For the first year (through the end of 2015), everyone on the team was an independent contractor (1099) but I paid everyone a consistent salary — we’re adults with bills to pay and it seemed like the right thing to do. Back in those days, I had no idea what I was doing. I still say that today, but the amount of stuff that I didn’t know about running a business at that point probably should have terrified people. The Year One team has my eternal gratitude; I have no idea what all of you were thinking. 😉

Fortunately, being able to structure my workdays and define my job the way I wanted to allowed me to network with a lot of people (notably other founders), listen to a lot of startup and business podcasts, and read a lot of books (John Durso of Crosshatch Creative sent me a Kindle copy of “Simple Numbers, Straight Talk, Big Profits!” after we met up and that book was very formative in how I approach the CFO-type responsibilities of my job). I was also watching a lot of Silicon Valley.

And it wasn’t all closing sick deals, hiring great people, and cashing checks.

I woke up many (i.e., most) nights with my mind running in circles about why I was going to lose a client, how they’d refuse to pay, how my team would finally realize I had no idea what I was doing, how my previous employer would sue me (they eventually would do that, but that’s a story for another time), and how this would all come crashing down. What saved me was shifting my attitude from having to crush it every day to simply having to get up each day and move forward in some way. I set the image below as my phone’s wallpaper and that became my single goal each day. I found that I could just put on pants and the rest would follow.

Achievement Unlocked!
Put on pants!

I also took up a regular practice of meditation which fostered in me the ability to interrupt unproductive or unskillful trains of thought so that I could refocus before I spiraled into anxiety and high stress. Thanks to Headspace, I actually ended up keeping a New Year’s resolution for the first time in my life by meditating every single day in 2016.

Following those first few months, I just tried to build the best agency, be the best CEO, and treat everyone on my team as well as I possibly could.

Now

Fast forward to today, UpBuild is a team of six people. We have four senior marketers on the team (leading client accounts and absolutely killing it), a Director of Strategy (who oversees it all, takes on some advanced client work, and provides an awesome counterpoint to my leadership style), and me (who is ultimately responsible for making UpBuild a sustainable framework within which the best technical marketers in the world can work).

As of this month, we have 18 active clients (3.6:1 client-consultant ratio). Based on the tight limits we have in place, i.e., limiting senior marketers to 4 clients and 145 billable hours each month, our earliest availability to take on new clients is in June (but most likely July). It’s hard to say “no” to exciting new prospective clients who have to get a SEO and marketing partner signed ASAP, but I guess if that’s our biggest challenges, we’re pretty well off.

From our capacity planner

On the financial end, UpBuild is on track to hit close to a million in yearly revenue. I’d be lying if I said that I wasn’t proud of that number, but top line revenue is largely meaningless if we don’t have solid profitability. For this year (Jan-Apr), we’re sitting at ~30% profitability, which I feel awesome about. When it comes to finances, my only metric is to maintain 15% profitability (and bank away 3 months of operating expenses). We definitely won’t maintain 30% profitability for long, because we’re gearing up to make two new hires, but that’s how I’ve been judging when we can make those leaps — build up profitability, invest in the team, and then fall back to ~15%. Loop.

What are our goals from here? Simple.

  1. Ensure that everyone on the team feels great about the work they do, gets opportunities to work with clients they’re proud to partner with, and feels like they’re part of something meaningful.
  2. Do the best work we possibly can for our clients and be of true service to them (and the wider web) by providing real and perceived value.
  3. Maintain at least 15% profitability.

That’s it. If we can keep doing those three things together and UpBuild has the same-sized team and the same revenue five years from now, that’s great. On the other hand, if we’re a 10 million dollar company with a team of 60 that would be wonderful as long as we hadn’t compromised on any of those three things.

Lessons Learned

So what has UpBuild learned over the course of our first two years? What have I learned? It’s too much to write out here, but on our two-year anniversary, a few major lessons spring to mind.

Do good work, every day

If you want our secret sauce, this is pretty much it. Do good work every single day. The rest more or less takes care of itself. It’s easy to worry about losing clients (but we try not to because we will lose every client), having the number in the bank account fall to zero, or falling short of what we were trying to accomplish (for a client or for ourselves) but even when things are out of control and/or falling apart we can find a way to do some kind of good work every day.

Prepare for the worst, but don’t worry about it

How can we prepare for the worst?

  • Have enough money in the bank so that we can cover payroll for a month (or a few months) if, heaven forbid, we lost our two largest clients.
  • Practice unimpeachable integrity so that we can never get called out.
  • Put our relationships with our stakeholders first, even if they’re offloading their frustrations onto us or not paying their invoices, so that positivity and empathy can echo far beyond the lifespan of the client-consultant relationship.

Don’t get hung up on the worst case scenario but, instead, ensure that you’re intentionally fostering what will minimize the fallout from that worst case coming to pass.

It’s not about me; it’s about the team

This is an anomalous one. I found that by always referring to UpBuild as “us” and “we” from day one and talking about what “the team” would do rather than what “I” could do for a client, I set up a natural handoff from me to a team bigger than myself. I know another agency, founded at around the same time as UpBuild, who still struggles with having everything resting on the founder’s shoulders. All the branding and confidence in the agency’s expertise is tied to the one individual and I’m thankful that this hasn’t happened here. Our clients would be missing out of working with some incredible talent.

Goals are crap

I tried making projections and setting goals around revenue, team size, the number of clients, etc. for the first 12 months or so. This kind of goal setting was ultimately abandoned. Setting those goals was fairly pointless and only served to get the company riled up about something that ultimately didn’t matter. We could easily get to five million in revenue, get a hundred clients, or hire two dozen people but if we’re all miserable from 50-hour weeks and we’ve overinvested in hiring, those “goals” might be what kills us.

Instead, we’ve changed the focus to team happiness, pride in our work, and financial health. If we can preserve those three things, I couldn’t care less about how big any of our numbers are.

We ask a lot of the people on the team

Most of the Year One team had worked with me before in some capacity. As such, they already knew what level of work UpBuild was going to expect or at least had an inkling of it. As we’ve grown and begun attracting talent from other agencies and companies, it’s become clear that we ask a lot of our team. I’m not citing this as a shortfall of incoming team members; I’m impressed that UpBuild as an organization still has exciting things to teach senior-level marketers. When I write the five-year anniversary edition of this post, I hope I can still say that folks at UpBuild feel like they’re learning new things every day and being pushed to improve.

Remote work is amazing and challenging

Now that I’ve had the experience of leading and being a part of a 100% distributed and remote team, I can’t imagine working any other way. We’ve learned a ton about remote work and how to solve its related challenges.

Being shamelessly idealistic and successful are not mutually exclusive

One of the most pleasant surprises that I’ve had throughout all of this is that virtually none of the “facts of running an agency” have turned out be set in stone. As it turns out, agency marketers don’t just get unavoidably burnt out, you can provide more and better benefits than the industry or government expects without going bankrupt, you can say “no” to money, you can let your team vote on every client.

The biggest thing I’ve learned in the last two years is to be shamelessly idealistic and question the defaults.

Thank You

If you’re reading this, you’re likely either,

  • on the team,
  • one of our amazing clients, or
  • someone who’s been following our journey.

You all have my deep gratitude for your support in making this dream a reality. I can’t wait to see what the next two years hold for UpBuild.

Until then, happy optimizing!

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