How I Started A $750K/Year Web Development Agency
Hello! Who are you and what business did you start?
I’m Ty Fujimura, Founder, and CEO of Cantilever Web Design and Development. We work with clients from the International Monetary Fund and IBM to local small businesses and startups. They come to us because they are looking for superior results from their websites, and we deliver that by providing their visitors with an outstanding experience and giving them a reason to come back.
Our core value is “Digital Hospitality” – the idea that a website is a place people inhabit, not a billboard they see from a distance. We like to say we aren’t just a technology company, we’re a hospitality company. I’m so proud when I read our Glassdoor reviews and our Clutch reviews, both of which speak to the effort we’ve put in to make work better for our clients and our people.
What's your backstory and how did you come up with the idea?
I’m the son of a therapist and an artist, and both sides of that upbringing prepared me well to manage a creative business! I was always playing with code and design growing up, and was lucky enough to have my dad’s tech hand-me-downs to learn on.
I regret bootstrapping because it forced us into making decisions based on the fear of running out of money, rather than on trying to find long-term value.
I majored in Mathematics at NYU, but while in classes I started to get the itch to design again. I did some portfolio pieces in photoshop but needed a website. I taught myself the basics by spending hours in Barnes & Noble reading every web design and development book I could find (even though I couldn’t afford to take them home) and got hooked.
I picked up a few clients and before long I had enough work coming in that I needed to hire people to help me deliver it – and the studio was born. I felt that if I had enough work coming in to hire others, we’d be able to build a company from that.
As a freelancer, I had found success by being reliable and by overdelivering on quality. I would often find myself writing copy and taking photos for sites when I wasn’t even getting paid to do so, and I would end up really ingrained in my clients’ businesses and decisions. This is a certified weakness as well as a strength, as I would get into disagreements or conflicts with people over the creative vision for a project. As I’ve matured I’ve let go of this impulse while still staying incredibly invested in the experience that each of our clients has. It’s pivotal in business to walk this tightrope between care and obsession. Don’t forget to water the plants, but don’t water them too much, either.
At the time I formally launched the company, my wife had just had our first child, and I was finishing up a year working at a start-up. It definitely felt like a risk to be on my own, but I’m so grateful that I did. I self-funded the start of the company and clung to cash as long as I could before the next few checks would come in. I definitely took a hit in the first quarter or two, but I was working stupid hours and got up to a workable income within the first year (please note: this is not a good idea, especially with a baby).
Take us through the process of designing, prototyping, and manufacturing your first product
Our “product” is our methodology for creating sites and our philosophy. You can read about it in our Handbook.
The very best sales move can be to forget about selling. Build relationships. Find people who interest you and be friends. Bring them value through your insight and genuinely care about them.
When I started the company I had a pretty solid network of collaborators and I know roughly how I liked projects to go. But we had no sense of “a process” or how we would necessarily pull something off. It was very much a “ready, fire, aim” approach. As such we did a lot of work more than once.
The process we use now has come from being incredibly curious about what works in our field, and also a healthy amount of trial and error. We now have a handbook with hundreds of procedures and policies that cover a good chunk of what we do. It’s hard to replace experience. Most of our projects have some substantial precedents from the 100+ other projects we’ve done over the years. We use that insight all the time to keep getting better.
We try to first know a client’s business and how they think before we start our own work. This is one of the most fun parts of the job.
One thing people often comment on with our work is our attention to detail. We care about every aspect of a site, visible and invisible. This leads us to overdo it sometimes. But we’d rather overdo it than care too little. When I see our clients notice it makes me very proud of the culture we have.
Describe the process of launching the business.
I was freelancing during and after college and was lucky enough to build a robust list of clients. I ended up hiring several freelancers to work on projects together. I particularly hit it off with Nevan Scott, a brilliant designer/developer, and a lovely and thoughtful person. We had a lot of great conversations about life and the industry, and we became really good friends.
In 2011, Nevan got wind of a development project for a large advertising agency. It was a much bigger piece of work than either of us had done before, but knew we could pull it off, so we pitched it confidently, and won the bid. I had been managing larger projects under the DBA “Cantilever” and I decided that it was a good idea to formally incorporate. I hired Nevan as our first employee and a founding partner. Nevan was definitely the most influential person for me in those earlier years. He has moved on to other adventures (in the teaching world) but remains a friend and ally, and I’m so grateful for the legacy he left here.
We cobbled together a good enough list of clients to keep us busy and kept delivering work at a top-level despite our size. Clients told other people. Most of the work we have today we can trace back in some way to the clients we had then. Referrals are like interest – they compound. A satisfied client today is two more tomorrow, then four, then eight… Always focus on high-quality relationships and investing yourself in anything you choose to do.
We started with a few thousand dollars that I had in my bank account, which covered staff for a few weeks and maybe some gear we needed. The first check for the large ad agency project was $20,000. I still remember sitting in the bank with Nevan to open a proper business checking account and deposit that money. It kept us going for a few months so we could hit the next check, and we slowly built some momentum.
I regret bootstrapping because it forced us into making decisions based on the fear of running out of money, rather than on trying to find long-term value. It has taken a while to get out of that mental model. I recommend trying to find some kind of funding, even if your “funding” is living with relatives for a few months to save money.
Since launch, what has worked to attract and retain customers?
Every customer is first and foremost a human being. Service companies are an amalgamation of social networks. The very best sales move can be to forget about selling. Build relationships. Find people who interest you and be friends. Bring them value through your insight and genuinely care about them.
The trick is you have to want these relationships for their own sake, not for any ulterior motive. Everyone can sense a phony friend who just sees you as a Hubspot lead. Luckily, it simply feels good to help people. As the ponies say, friendship is magic. When I find us in a sales drought I have come to think “wait, how many people have I sent referrals to lately? How many lives have we improved lately?” You can’t gain if you don’t give.
When we work with sales leads we seek to help them no matter whether we’re the solution or not. We recently brought on a new head of sales and marketing and he told me that he spent an hour on the phone talking a wrong-fit lead through what they needed to do to launch their business. I was super proud because that’s exactly the spirit of what we do. We helped them in their journey, with no expectation of reward.
Diffusely, this applies to your marketing. If you give people something they value, they will use and recommend you. Back when we started, Teehan + Lax was a studio we really admired, not just because they did great work but because they were always contributing resources to the design community.
The role of marketing and advertising for service companies is to expand your network quickly and into areas where you don’t already have a foothold. Advertising does not create a business, it creates relationships. Relationships create a business.
90% of our customers can be traced up the referral chain to original personal relationships I had and developed for their own sakes. I am crazy lucky because I grew up in NYC in relative privilege, and so my network is naturally tuned to support a business like mine. However, anyone can look at the network they have and see what opportunities it might afford them. Opportunity is everywhere.
How are you doing today and what does the future look like?
Today we have 11 people on staff, distributed across the U.S. and Canada. We are and always have been profitable. Over the last twelve months, our revenue was over $750k, which is a neat milestone we’ve never hit before. Our gross margin is about 50%, so for every dollar of revenue, it costs us 50 cents to deliver that work. This doesn’t include our admin and sales staff, which we consider a part of our overhead. A gross margin of around 50% tends to be reasonably healthy for us.
We only started paid advertising in earnest this year but early signs point to a modest but positive ROAS. We are refining our advertising to reach the right people. We are not always the best fit, and so we need to advertise as much as possible to the specific people we serve best. We have a brilliant young social media marketer, Liam Ramsey, who has been defining our tone and approach to social. Those followings have been growing steadily.
We are on a long-term quest to refine our process and philosophy so that we can expand and reach more people. We have a wonderful team of passionate people who I love working with every day. Our mission is to make great creative work easier.
Through starting the business, have you learned anything particularly helpful or advantageous?
I’m an alum of the Goldman Sachs 10,000 Small Businesses program, which I highly recommend. Our brilliant alumni coordinator Javis Brunson gave us an aphorism I’ll never forget:
“What you allow, you endorse.”
A CEO is like a gardener. You tend to the plants and watch over them, but you can’t make them grow. When your garden is weedy or dry or overgrown, your job is to correct that. You have to pull the weeds when they’re small before the roots set in and the damage is widespread. If you notice anything you dislike about your own company or culture, fix it. Now. Or at least make a list, and get to things one by one.
Like many people, I avoid hard conversations sometimes. But the best policy is candor. When someone’s not a fit, tell them. And when someone’s doing well, also tell them. Don’t assume that people realize you appreciated the good work they did. Overdo it. Your people should always know exactly where they stand and what you are asking them for.
What platform/tools do you use for your business?
We have an “asynchronous” office culture with loose expectations around response time but high expectations around accountability and independence. Our main tools are all geared to that approach:
- Basecamp (project management, chat, team management).
- Notion (handbook, databases, documentation, and other shared knowledge).
- G Suite (storage, email, and office apps)
- Harvest (time tracking, invoicing)
- Xero (accounting)
- Gusto (HR & Payroll)
- Hubspot (CRM)
Our actual working applications are:
I am a Getting Things Done (GTD) enthusiast and rely on the system beyond words. I use Omnifocus to manage my tasks. It is probably the most important tool I use.
What have been the most influential books, podcasts, or other resources?
I have read a lot of amazing books about design, development, and business, but the one that’s had the most influence is one about productivity: Getting Things Done by David Allen. The book is about creating a “mind like water” by consolidating your commitments in a trusted system (digital or physical). Your mind is for thinking, not storage.
I read it and thought it was neat, and got a brief productivity boost. Then about a year later I really read it and implemented the system it outlines, and it changed my life. I couldn’t function at a high level without the GTD principles.
Advice for other entrepreneurs who want to get started or are just starting?
Start with “why?” What motivates you, inherently? What do you love? When I started Cantilever I did it because I was just so passionate about design and development. Today my career purpose is to unite business and creativity. What motivates me is to change the way our industry works, and to improve the lives of our people, our clients, and our communities. That is why I do this instead of getting a day job somewhere.
Money tends to be a bad motivator. There are lots of times as an entrepreneur when you have to take financial hits. Those are the moments you need your strength the most. If your goal is to fix something then you will have the fortitude to push through those difficult times. If you solve a real problem that people care about, you’ll do well financially as a by-product.
Financial management is so important. You must understand your books to be a successful entrepreneur (even if you aren’t a numbers person). Managing a company’s finances is a blend between careful prudence and bold investment. Too much of either is bad. If you lean towards one side or the other, you need people around you who can balance you out. Don’t be afraid of debt, but don’t become a slave to it.
The most important part of a business is of course its people. Figure out your values and hire people who share those values. Be willing to pay for quality. Err on the side of doing too much for your team – financially and personally. Give people a chance to succeed, but don’t delay to release people who aren’t the right fit. Look outside your personal networks. Diversity is not a “nice-to-have” or a social obligation, it’s key to an effective team. Monoculture is counterproductive if you want to make a “dent in the universe.”
Lastly, ENJOY IT. My work has given me so many cherished relationships. I have seen so many great places and opened up opportunities I never would have had otherwise. This life has a lot of tough aspects but if you’ve chosen it, make sure to smell the roses too.
Are you looking to hire for certain positions right now?
We are always on the lookout for people who share our values, whatever their skillset. If you care about the same things we do, let’s talk. It might not be the right time, but when that time comes, we’ll know you!
Where can we go to learn more?
If you have any questions or comments, drop a comment below!
Cantilever Web Design & Development has provided an update on their business!
3 months ago, we followed up with Cantilever Web Design & Development to see how they've been doing since we published this article.
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