How We Started A $35K/Month Online Advertising Agency

Start An Online Advertising Agency
About The Company
Coming Up With The Idea
Building The Product
Launching The Business
Growing The Business
Revenue + Financials
Lessons Learned
Recommended Tools
Books & Resources
Advice For Founders
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$35,000
revenue/mo
2
Founders
2
Employees
product
Loop
from Milan, Lombardy, Italy
started September 2017
$35,000
revenue/mo
2
Founders
2
Employees
1.88M
alexa rank
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Listen to the audio version of this story!

Hello! Who are you and what business did you start?

Hi! We are Francesco and Valerio, and in 2017 we founded Loop, a $35K/Mo Online Advertising Agency. Our company primarily deals with Paid Advertising services (Google Ads and Facebook Ads mainly), specifically focusing on improving campaign performance for our clients. More recently, we also started working on chatbot-related projects.

We do not offer a wide range of different services, as we believe that specialization is the key to give the best possible service.

We work with clients from all around the world (mostly Italy and the USA, but also Europe and China), all with very different projects, but brought together by the will to improve their results through investing in online marketing.

Our company is rapidly growing (with an average of +150% yearly increase in revenue), as we deepen our outreach to new markets and industries, including IT, eCommerce, Local Services, Food and Beverages, and Fashion.

We started by offering just campaign management, but now also offer creative services and strategic advice, while always maintaining a major focus on numbers.

how-we-started-a-35k-month-online-advertising-agency

What's your backstory and how did you come up with the idea?

Our story is quite simple but rather atypical.

We both worked as freelancers (Francesco on Facebook since 2014, while Valerio on Google Ads since 2016), so in 2017 we decided to join forces and found our own agency.

We both came from a stereotypical freelancer background where we found our clients through online marketplaces.

From the very beginning, we have designed our agency to be slightly different from the average general service web agency, in which we were seeing organizational and expertise limits.

We decided, at least for the early stage, not to hire any employees, but rather to rely on other freelancers and associates with proven abilities and experience.

We live by the rule of the “3 Ps”: Performances, Priorities, and Processes. We try to achieve the best possible results through work organization and self-discipline, always focusing on elements that turned out to be most effective in relation to their outcomes.

We’re huge fans of the “80/20” rule and we try to always apply it, where possible. Thanks, Perry Marshall! We owe you a couple of drinks.

Over the years, we have been exploring and living in different work environments (as employees, freelancers, “almost-work-partners” in a similar project), and we always tried to treasure all experiences, even the negative ones, in order to avoid repeating the same mistakes over and over again.

We both hate micromanagement, therefore we prefer not to accept projects if we’re not sure we’re going to have a certain degree of freedom of choice. We simply preferred not to acquire another customer if you feel we were not totally able to handle it in terms of time, and resources.

We’re always grateful to those who work with us, but also to people that support us and give us advice. Relationships are the key.

The idea behind this has always been the following: we want to offer high-quality services, hence we want to expand in a very specific market, that in Italy is not yet saturated.

It just came naturally, as this was basically what we had been doing so far, and it was clearly working well.

However, we wanted to raise the bar of our earnings and for the number of projects, we could handle, compared to what we would have been able to do as solo freelancers.

In the past few years, we’ve been having better opportunities, but also new challenges: we believe our strength has been to have a clear vision in mind since the beginning, therefore we could act focusing on that.

At present, we’re able to manage the agency 100% remotely, also by delegating all the non-operational roles (accounting, administration, etc.). This has been quite a challenge initially, honestly speaking.

how-we-started-a-35k-month-online-advertising-agency

Take us through the process of designing, prototyping, and manufacturing your first product.

The projects we handle in Loop are not so different from the ones we used to manage as solo freelancers - but they surely have a different size and a different complexity. We do not prepare a package of services for our clients, as we prefer a more tailored approach, regardless of their budget.

All the services we offer renew on a monthly basis, with a minimum of 3/6 months, depending on the project itself.

We don’t want to force our clients to stay with us, but rather we wish them to stay based on their judgment, and not based on a contract they feel they need to honor.
However, some of our clients have been with us since day 1!

By doing so, we often find ourselves dealing with reasonable and nice clients, and our collaborations proceed in a smoother way. A sort of ‘karma’ we like to believe in.

The churn rate is low and this allows us to work and thrive without being anxious, and moreover without the need to always struggle to find new clients and potentially do a bad job.

One thing we’ve always found useful during client acquisition has been to offer the analysis of their existing advertising accounts for free in the first place. By following this approach, we’ve had the chance to point out critical issues and improvement opportunities (via video calls or written reports), and this helps us to look even more trustworthy for our potential clients.

Metaphorically speaking, this means opening the bonnet of your car and pointing out what the problems and solutions are, before speaking about any fees or asking for any money. We have been refining and improving this method so that we can now call it our specialty.

Describe the process of launching the business.

We built a company together mainly for two reasons. We felt that working alone was limiting us in terms of potential revenues (our fiscal plans forced us to keep our individual yearly revenues under a certain threshold to have taxation benefits initially). We also felt that while our focus and specialization were somehow useful initially, it proved to be somehow limited in a scale-up phase. Potential customers wanted more services and a more structured interlocutor in some cases - the bigger the prospect the higher the project complexity in most cases.

Starting a company was the attempt to start fixing these two problems that were somehow limiting our growth as solo consultants.

Interesting thing is that we always been good matches professionally: Francesco focused on Facebook Ads and has significant experience in sales; on the other hand, Valerio decided to focus on Google Ads and felt that an administrative role was a good fit.

Teaming up has been somehow easy because we started working together with a clear role division.

We started from a good customer and prospect base as freelancers and we just started facing the Italian market with more self-awareness, more service, and a slightly better online presence.
Afterward, we decided to add more services and learn new skills. Now we also offer landing page building, Conversion Rate Optimization, Messenger Chatbots among the other services.

Given the structure of the agency, we do not have large overheads and costs, therefore we’ve always taken a salary from our agency earnings. We are quite cautious when it comes to agency money and expenses, so we never had any cash flow issues so far.

In fact, launching our agency as a 100% remote-working based company reduced the initial starting costs, and opting for freelancers instead of hired workers helped us scaling up gradually and allowed us a certain degree of flexibility in business management. In the first years, our costs have been mostly around freelancers and online tools.

The business growth pace has always been gradual. Our online presence has become better over time, starting from online advertising communities (constantly creating content and lessons, especially on Facebook and LinkedIn). We’re now proud to find time to join events (even as students), delivering University lessons and both online and offline masterclasses.

What really helped us in our growth and development was our constant presence in numerous online communities. We were reaching tens of thousands of people daily, and this allowed us to truly get the chance to talk about our “hands-on experience” and our results, triggering a lot of positive reactions and bringing us several collaboration requests.

Anyway, we are aware that all of this is mainly useful for the early stage, and will not work for a more complex organization; this is why we’re currently working on structured methods to help Loop become more and more visible among its target audience.
This strategy will be more effective with an increased advertising investment.

We don’t exclude that we may need at least an operative to headquarter in the next future.

Loop’s initial stage taught us the importance of having a vision and living “in the business” and not just “on the business” so that you can understand its peculiarities.
This inspired us to create a team and grow it.

Since launch, what has worked to attract and retain customers?

Our very first agency clients came from our solo freelancer experience, online marketplaces, advertiser/marketers communities, and word-of-mouth. Most of them were consolidated local businesses and small (but brilliantly built) eCommerce.

We’d say working on online and offline education also helped us acquiring customers initially. We personally built and manage a couple of Italian communities:

Facebook Advanced | Marketers - Italian Facebook Advertising Community (33k members)

Google Advanced | Marketers - Italian Google Ads Community (11k members)

Both were created from scratch in a partnership with a larger, online education community (Marketers). We share news, case studies, tutorials and how-to’s, and most of the content is free for our users. We got the chance to meet a lot of people, both online and offline, and we often had the privilege to run Q&As with Italian marketing experts and colleagues like Luca Orlandini and Gianluca Lisi).

This naturally generates a great return in terms of contacts initially and leads as a consequence. Our efforts have been around moderation and content production and syndication - sharing and crediting great resources produced by others.

A couple of contents (in Italian) that worked great:

These are just ‘peak’ examples in terms of approval (likes, shares, engagement, private PMs), but what proved to work is posting frequency and overall quality. Content is tailored based on the interests of our followers (current and potential): we always aim to give them useful and practical advice.

We plan and produce content both for colleagues (freelancers, agency owners, advertising specialists) and entrepreneurs - a huge effort that gives huge returns in terms of partnerships and prospects. We also worked hard on debunking false advertising myths and crediting other valuable content producers in our community. Overall, ours are tiny efforts in the direction of cleaning up and improve the entire online advertising ecosystem. We definitely feel to be more librarians than rockstars, but we believe that ‘safely’ running two large and trusted communities boosted our credibility a bit.

Speaking about Loop clients, SMBs were initially easier to engage with, as they were more prone to understand our model (no offline meetings, no aggressive selling and so on). Now we’re a bit more picky, not just on budget thresholds but on trust and decision-making autonomy on what concerns our efforts.

We love customers from the USA and UK because they are more challenging (read: pleasant to work with as professionals that want to raise the bar) and they trust more online advertising, overall. We like to think that we are giving our small contribution to the Italian ecosystem to bridge the gap through our online communities.

As an agency, now we mainly serve our content organically, but we also use social interactions, trust, and engagement to create remarketing campaigns on Facebook to acquire new leads.

In our opinion, another approach that distinguishes us is the very precise selection criteria we use for accepting clients. We tend to accept and work on projects we believe in, and where we see the potential for us and for our clients to succeed.

Of course, this doesn’t mean choosing easy projects but rather being realistic and pragmatic on what we can do and what can be achieved.

We would never offer services we have no experience with, and moreover, we prefer to create a solid relationship with companies and colleagues that share our mission and vision and that are complementary to us (e.g. SEO, visual content, video making, etc.), so that we can offer our customers a better service. We never wanted to get money from our cooperation to keep ourselves free to decide the best possible partner for each project.

How are you doing today and what does the future look like?

As mentioned, the agency is in a healthy position so far. We are pretty satisfied with our results and our growth, while we’re constantly improving our performance and the ones of our clients. For example, in 2019 alone we handled a €1.5M budget for Google Ads advertising. That’s not bad for a small Italian firm in its 3rd year!

We keep receiving collaboration requests, also thanks to some of our biggest clients (the largest eCommerce business in the world is one of them, as well as some of the most famous Italian keynote speakers and trainers and fashion brands). They are satisfied with the job we did for them, therefore we may have more opportunities.

We do foresee a promising future for ‘boutique’ agencies like ours. Requests for specialized services are constantly increasing, as many old fashioned web agencies are not so skilled when it comes to online advertising, at least in Italy.

We also do see challenges, for sure. Like for example, our team of freelancers growing as well as the number of our clients, administrative complexity, etc., but we’re positive about that.

We are about 15 persons - all of them are freelancers and independent contractors, both full-time and part-time, including

  • One administrative assistant
  • One graphic designer
  • About seven Google Ads and Facebook Ads specialists (actively looking for at least two more)
  • Two Project Managers

Our goal for 2020 is to keep growing smoothly and not letting work become an obsession or a source of stress. Driving too fast can sometimes mean running into a wall! We still need to wear both the hats of business owners and campaign managers on the same day, but we are slowly and steadily shifting towards the first.

Nowadays, we’re interested in clients that not only can make our agency economically viable (trying to grow our projects’ dimension) but can also help us improve our processes, expand our expertise and allow us to create case studies. For example, in the last 3 months, we’ve been acquiring several new projects to work on, and this gave us the opportunity to refine and improve our systems, especially thanks to our new partners Lorenzo Tombari and Simone Magazzù.

how-we-started-a-35k-month-online-advertising-agency

Through starting the business, have you learned anything particularly helpful or advantageous?

5 things we’ve learned in the last 3 years:

Learn to delegate.
During Loop’s first year, we worked too much and delegated too little. We were both dangerously close to a burnout. Things started to go better when we finally decided to only focus on key activities.

Gratitude.
We dig people who love their job and give 110%. This is why we’re always grateful to those who work with us, but also to people that support us and give us advice.
Relationships are the key.

Cooperation.
Luckily we understood this quite early, but we’re still surprised there are so many of our colleagues that are failing to get it: online is a world where cooperating is definitely better than competing. There are so much to do, and so few people capable of doing it.
It’s always worth collaborating, even with a company offering the same services as you.
Karma can be surprisingly generous!

Work/life balance.
Eat well, get some rest, do physical exercise and you’ll be ready to give 100% for the day. We have sometimes neglected these aspects, especially at the beginning. We’re respecting ourselves more now. Let’s call it self-awareness.

Having fun.
It’s so incredibly easy to let the everyday routine overtake you, especially during stressful periods. Sometimes we just like to unplug our computers and take a day off to enjoy a well-deserved beer and our friends’ company. This is very important for an agency like ours, where we’re often at home, along with our computers.

Like in a videogame, despite some errors, we try to overcome more and more levels, while learning from our mistakes.

Our personal values are concreteness, respect, responsibility. It may sound trivial, but we’re really happy to wake up every morning and turn on our computers while sipping a good coffee. We truly hope this is the same for our partners!

What platform/tools do you use for your business?

Being a full remote agency, we needed simple and effective online tools.

The first obvious choice was GSuite. We mainly use it for inbox (Gmail) and cloud.
It’s very easy to manage new accounts and all related permissions, without needing dedicated IT support.

One of the most considered choices has been for the collaboration tools, as we wanted to be 100% sure to find the perfect tool for our needs. Slack, Asana, Trello could have been potentially good, but we felt they had some limits and constraints.

After an exhaustive software selection process, we chose Basecamp. It allows us to manage the following aspects for each one of our clients:

  • Files
  • To-do lists
  • Calendars
  • Discussions (even chats with the client)
  • Automatic checks on the project’s status

Basecamp’s advantage is that it is extremely easy to learn and use, so everyone liked it immediately.

Other tools we regularly use:

  • Data Studio + Supermetrics: very nice for reporting, both for Facebook and Google campaigns.

  • WhatConverts: an amazing piece of software we chose to help us track phone calls from different sources, including PPC and organic traffic. Literally a game-changer, especially for local activities.

  • Unbounce for Landing Page creation: it allows us to focus on the creative and communicative side without struggling with the technical aspects of putting online a domain, implementing modules, running tests, etc. It’s a bit expensive maybe, but we think it’s worth it as it makes your life a lot easier.

  • Streak: nice, easy and fully customizable Gmail-based CRM. We love it.

  • Amazon Workspaces: the possibility to always have a remote, personal Windows machine available allows us to work at our best even on lightweight clients like Chromebooks.

What have been the most influential books, podcasts, or other resources?

Books:

  • The E-myth Revisited - Michael Gerber: clear teachings on how to create a company in a serious and profitable way. We found it eye-opening in its simplicity.

  • Marketing Management - Philip Kotler: it’s like the Marketing Bible. We started building ‘human-centric’ campaigns and landing pages - this simple principle helped us a lot besides the traditional best practices.

  • The Culture Map - Erin Mayer: a very useful book if you wish to understand how different cultures can interact, both on a human and a business level. Italy, for instance, is not just Pizza and Spaghetti :)

  • 80/20 Sales and Marketing: The Definitive Guide to Working Less and Making More - Perry Marshall: amazing tips on how to drive your efforts where there are more effectiveness and profitability in terms of cost/opportunity.

  • Tools of Titans - Tim Ferriss: very interesting points, both under a human and a professional point of view, especially concerning self-discipline.

Blog/online resources:

  • Smartinsights: very high-quality education on digital marketing.
  • Sleeknote: in-depth blog regarding the digital fields.
  • Zest.is: Chrome extension that allows you to read and check new content (marketing and digital themed, of course) every day.

Advice for other entrepreneurs who want to get started or are just starting out?

If you deal with consulting, always keep in mind that you need to work WITH your clients and not FOR your clients. Avoid clients you find hard to communicate with, especially the ones that think they can “use” your expertise and your time only because they’re paying you. This mindset is not business, it’s prostitution.

If you want an online project to grow steadily, you need to build a big, reliable brand. All the projects we’ve been working on, regardless of their geography, budget and size, had two common denominators: social proof and credibility.

If your team is not properly trained and well informed on what they need to do for a specific project, they do not “perform”. Briefings and processes quality will avoid tons of mistakes and misunderstandings. Also, if freelancers/employees are too tired or stressed, they will make more mistakes. There’s a threshold when it comes to the number of tasks and the number of responsibilities. Try to avoid these moments with accurate workforce planning.

Are you looking to hire for certain positions right now?

We’re always looking for Google Ads, Facebook Ads, and Digital Analytics experts :)

We do select freelancers directly through the communities we work in, courses and workshops we deliver, and of course through our personal network as well. All the freelancers are chosen by us, after a deep technical (and human!) check. Their mindset, their will to improve and grow every day are the most important qualities they must have in order to work with us.

We’re not looking for a phenomenal guru, we’re searching for people who are willing to take care of a project and handle it seriously, with passion, always aiming for day to day improvement.

Our most recent hires range from young freelancers in their 20s to 50-year-old professional figures coming from a totally different industry.

What do these people have in common? They’re passionate and they are eager to learn.

Where can we go to learn more?

-  
Valerio Celletti,   Founder of Loop

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