In this episode of Hubstaff’s Agency Advantage Podcast, I’m talking with Keith Perhac (Twitter) of DelfiNet.

DelfiNet is a technical marketing agency that at its peak had a team of 14 spread around the world, servicing clients in Japan and the US. But his life was a constant battle of managing client expectations, managing his team, and putting out whatever fires pop up in between. One day, the bottom fell out.

One day, the bottom fell out.

Today Keith’s agency has only 6 employees and is doing around $1 million a year in revenue. To get to this point, he had to take a step back and evaluate his priorities.

In doing so, Keith realized just how important it is to be deliberate not just about when you hire, but also whom you hire. And in this episode, Keith will share his hard-earned lessons about hiring the right way.

.@harisenbon79 on how to avoid horrible mistakes when hiring for your agency (PODCAST) Click To Tweet

Keith doesn’t hold back at all in this interview and really dives into where things went wrong and this is one of the most honest looks into an agency that I’ve had on the show.

Download a full transcript of the interview with Keith: Get it right here.

Key Takeaways

When things went off the rails [2:00 – 6:00]

DelfiNet was growing quickly, so they started hiring more and more people. They soon great to a team of 14 people, split between the US and Japan, but one day the bottom fell out. Clients weren’t getting the deliverables they were expecting, and Keith frankly wasn’t always confident he and his team delivered the value that the clients were promised.

The problem is that when a team grows that quickly, you need to make sure your processes scale up as well. The way you communicate when there are just 2 or 3 of you is entirely different than when there are 14 people, especially when you aren’t all in the same room. Not only is your team growing, but you are also working with more clients as well, which means your project management processes are going to be stretched to their limits.

In periods of rapid change, you need to focus even more on getting the right processes in place, but when you are constantly putting out fires it’s nearly impossible to find the time to plan and execute those processes.

For Keith, he knew he needed to slow things down and grow deliberately if he wanted to succeed.

Making the right hiring decisions and why it matters [13:00 -22:00]

Keith tried hiring people near shore, offshore, freelancers, consultants, expensive people, cheap people. They tried everything. But at the end of the day, the only consistent factor they’ve identified in their best employees is that they care about the work they are doing. This is even more crucial when you are a small team, because if you mess up, you now have a significant portion of your company that is effectively dead weight.

In some highly productized businesses, highly skilled and motivated employees may not be necessary, but if you rely on your employees more than a standard operating procedure, you need to make sure they are there for more than a paycheck.

Minimizing your hiring mistakes [32:00 – 34:30]

Keith’s advice for hiring is relatively straight-forward, but at the end of the day, it works:

  • If you’re a small team, only hire 1 person at a time
  • Hire 3 months before you truly need somebody
  • Start with short-term contracts to make sure they are a good fit

These tips don’t ensure that you never make a mistake with your hiring, but if you follow them you will drastically decrease the likelihood of a hiring mistake and limit the impact if it happens.

Above all else, though, avoid the common trap of tying your ego to the number of employees in your agency. If you want to build a giant company, that’s great, but don’t do it at the expense of your profit margins or, more importantly, your stress levels.

Transcript:

Andy Baldacci:Keith, thanks so much for joining me today.
Keith Perhac:Thanks for having me, man.
Andy Baldacci:Of course. You have a really cool story and I want the listeners to actually hear that. Usually this is a throw away question, but for you it’s really not. Can you explain what it is you do today at DelfiNet and how you ended up there?
Keith Perhac:

[00:00:30]

DelfiNet is the agency that I started and we are a technical marketing agency. That sounds all pretty standard on the front-end, but the thing I think that you’re referring to is the fact that until 3 months ago, I was not in the US at all, even though all my clients were. We actually started the company in Japan about 6 or 7 years ago.
[00:01:00]We were 100% remote even to the point where I wasn’t on the same time zone. I wasn’t even awake at the same time as most of my clients. It gives us some interesting challenges. Now, there’s some good points about that which was we had essentially 24-hour coverage for all our clients. Someone was awake at all points during the day, but I had a lot of early mornings and a lot of late nights trying to make sure that I could get on client calls all the time.
Andy Baldacci:You had a Mixergy interview where you really dove into that. I don’t want to rehash all of it but for listeners, if you’re curious about that back story, check out the Mixergy interview. It’s a cool story. Roughly, how big are you guys today?
[00:01:30]

Keith Perhac:

We fluctuated a lot. We’re 6 people right now. I have to check revenue, but we’re just under a million, I believe in revenue.
Andy Baldacci:Nice. What is that ramp up been like? Has it just been linear, slow growth?
Keith Perhac:

[00:02:00]

A pinball. It all comes in spurts. We grew a lot and I had a lot of focus where I could focus 100% on the business. We were growing very fast revenue wise and we hired a lot of people. At one point, we were 14 people. We had a Japanese team that was focusing on marketing to Japanese clients. We had a US team that was focusing on marketing to US clients as well as the dev design and marketing teams doing all the development and producing deliverables. Then the bottom fell out of that after …
Andy Baldacci:What happened?
[00:02:30]

Keith Perhac:

[00:03:00]

A number of things. I think a lot of people also have this where you grow and you’re growing and you have this influx of money and you’re like, “We need to grow this as fast as we can.” When you’re 3 people, you have a way of working and that doesn’t work when you’re 14 people. Back when we were really small, when it’s just 2 or 3 of us, we all owned everything. We hopped on Slack or there wasn’t Slack back then, whatever we chatted on, I think Skype.
We just kept talking and we talked through any problem and everything was collaborative and things got done. You can’t do that when you’re 14 people because everyone is working on something different. We had, at that point, I think 15 to 20 clients. Everyone is working on something different. They all have different expertise. The designer has no idea what the developer is saying. The marketer has no idea what either of them are saying.
[00:03:30]Where one person could manage everything, now you’re having to put things in the teams and some people are speaking Japanese, some people weren’t. There’s just so much going on.
Andy Baldacci:What was your role at that point?
Keith Perhac:
[00:04:00]
My role at that point was mainly sales and promotion. I had a couple of event people who were scheduling me to go give talks. I got a couple of articles in the Huffington Post. I think, monthly we did a seminar locally and then I would generally travel out to Tokyo or Osaka, wherever to give a speech or some sort of seminar there as well.
Meeting with lots of clients, pressing the flesh. Just getting the name out there and trying to grow the business which honestly once you get passed maybe 5 people, that’s what you, as a business owner, really need to be doing because no one is going to be able to sell it as well as you.
Andy Baldacci:Exactly.
[00:04:30]

Keith Perhac:

That also comes in the problem of, you’re able to sell it because you know it and you have the experience and you know what you’re doing. You have to let go of that. You have to let go of the doing in order to focus on the selling and to make sure that everyone is happy in their strategy and everything is moving, but the business is growing.
[00:05:00]That’s where it started crumbling where I’m focusing on getting more clients and it’s going really well, but we never put the process in place because we grew up too quickly. We never had a slow ramp up of, now we’re 6 people. Now we’re 7, now we’re 8. It was more like, “Hey, we’re 3. Holy crap, we’re 6 and hey, where did the other 7 people just come from?”
Andy Baldacci:How did you manage it? Were there any red flags along the way or was there one thing where you were just like all right, something needs to change. What happened? Was it just was it just waking up one day and looking around what did I build? What happened?
Keith Perhac:

[00:05:30]

The biggest thing was when clients started saying, “Hey, where are my deliverables?” I think it still happens to a degree. I think we’re getting much better at it but at the end of the month, when I send out invoices and we’re like, “Everyone has a retainer. Did I provide 40 hours worth of value to this client?” not, “Did I spend 40 hours?” That’s a completely different thing. We’ll get into this as we talk about the right people to hire but you can’t charge someone 40 hours for a single landing page.
Andy Baldacci:Exactly.
[00:06:00]

Keith Perhac:

[00:06:30]

Maybe you can but you’re not going to keep them as a client very long. The problem then is I was starting to see clients who either, A, we’re not getting the hours that they had paid for at which point I of course didn’t charge them or B, they’re getting hours but not quality. We haven’t given them any deliverables. Maybe we sent them 20 designs and they were all like, “Oh, yeah. That’s great.” In 2 months, we never pushed anything out the door.
There was no point where we were improving their site. We were giving deliverables but not improving the metrics which is what we focused the company around. We really had to have an internal view of our … A, it’s not good enough to provide hours. We need to be providing real value. Even if it’s not what the client wants in a way because the client ask for, “I want 20 designs for this.”
[00:07:00]We should step back and we should step up and say, “No, you don’t want 20 designs of this, you want 3. We’ll start with running that now and then once we see that, then we’ll iterate. I mean they don’t pay us just to build stuff. They pay us to be …
Andy Baldacci:No. You’re not a construction worker, you’re an expert, you’re the architect.
Keith Perhac:Exactly.
Andy Baldacci:They come to you for advice.
Keith Perhac:
[00:07:30]
We’re a consultancy. They come because we know what the hell we’re doing and they want us to know. That was some of the problems. We had people on the team who were not experts. Not really performing that expert role but just listening to what the client wanted instead of what we knew was best.
Andy Baldacci:Were the clients interacting directly with the team members or what was that communication like? How did that work?
Keith Perhac:
[00:08:00]
We’ve had a couple of times where that wall broke down. We generally tried to have people communicating with 2 or 3 of us. The manager/strategy level. As communication broke down because we were too busy, we had more leakage where clients were emailing the developer directly. As much as I love my developers, that is a recipe for disaster in all lens because, A, just like myself, the developer wants to please the client.
[00:08:30]They want to do a great job. All my employees, they want to do a great job. If a client comes and says, “Hey, can you do this?” I’m like, “Yes. I will jump on that right now and do it.” Then they don’t understand all the other things that are moving with the company and that throws everything else off balance. I’m just as bad at that. There’s a reason that my COO doesn’t let me promise things to clients anymore.
Andy Baldacci:You’ve learned.
Keith Perhac:
[00:09:00]
I’ve learned. I always say whenever a client asks, “When can this get done?” I say, I’m like, “Scott, do you think that next Friday is a good timeline?” I let him make the decision because that’s not a place where I need to be.
Andy Baldacci:What does your business look like at this point? Are you profitable? How is it impacting these communication issues, these types of staffing issues, how is it impacting the business itself?
Keith Perhac:
[00:09:30]
We are profitable. We go up and down on profitability only because we try growing, we’re trying different things to get our processes to work. Sometimes it costs more money, sometimes it costs less. As a business owner, the goal is to reach out into new verticals and to try and figure out where we can best use our talents to make more money. Is that always getting new clients? Is that doing something like an online course? Is that doing something like SaaS? What does that look like? We make a lot of false starts/investment into that kind of stuff as well as our standard client stuff.
Andy Baldacci:Yes.
Keith Perhac:Go ahead.
[00:10:00]

Andy Baldacci:

It’s not that the business wasn’t performing or anything like that, it’s just there are a lot of fires that constantly needed to be put out.
Keith Perhac:

[00:10:30]

Exactly. That’s been our goal the last 6 to 8 months which is let’s stop having so many fires because when you have 14 people working over 4 continents, 2 languages, doing marketing design development, the whole shebang and 2 SaaS apps. There’s a lot of fires that need to be put out all the time. Our focus for 4 or 6 months has been let’s slim things down.
Let’s get a good process so that when I say, “Hey, client A needs a new landing page in evergreen warming funnel, we know exactly what that means and it just goes boom, boom, boom, clockwork. We don’t have this whole back and forth of what’s a landing page? How many emails go in? It’s all standardized. It’s a process that we all know how to do.
[00:11:00]

Andy Baldacci:

Was there a tipping point that made you realize we need to do differently or was it just what happened to [crosstalk 00:11:03].
Keith Perhac:

[00:11:30]

Multiple ones. The one that caused me to slow down what we were doing into remove the Japanese side of things was essentially just not seeing return on investment and just being too tired. Just burn out. The one that made me realize that we need more process and I need to get out of the management was the fact that I hadn’t slept in about, I think 4 weeks or something just because I was so stressed about if each client was getting stuff delivered to them.
[00:12:00]Different people have different personalities. Different people have different skill sets. They are okay at different things. The idea of managing multiple things and managing expectations of people is so out of my comfort zone because I like people to be happy. Whenever anyone emailed me that’s like, “Hey, I thought you were supposed to have this yesterday?” that just destroyed my life. Even if it’s not a mean email, just saying, “Hey, I thought I was supposed to have this yesterday,” freaked me out.
Andy Baldacci:You’re like, “Oh, I let them down.”
Keith Perhac:
[00:12:30]
I did. That’s exactly what I felt. I would drop everything. I’d jump into that and then I had 2 clients email me. Now, I’m torn and I’m freaking out. This increased and increased. This was while I had a project manager as well. It’s not like they weren’t doing their job, it was just there was a lot of stuff. What he and I decided, I said, “I can’t deal with this anymore. This is not what I’m good at. I’m good at building strategy. I’m good at providing tools. I’m good at coming up with the ideas and building out what we’re going to do but I can’t manage 10 clients.”
[00:13:00]We need to build SOPs or I need to build SOPs. I need to build checklist. I need to build processes. You and I need to work together and you need to take over what’s going on with everything because I can’t do it. One of the things I really want to talk about today was the importance of hiring people who you can trust to do that.
[00:13:30]We have hired a lot of people from different cultures, from different strategies, from different skill sets and it’s really hard to find people that are completely invested in our company and who are going to do good work. We’ve tried a lot of near shore, offshore, freelancers, consultants, the whole kit and caboodle.
[00:14:00]We’ve tried expensive people, we’ve tried cheap people and the only thing that we’ve seen consistent is people who are focused on working with us and focused on our success, we get great results from. If we’re just another client or they have a ton of other stuff going on in their life, they just don’t care about the work that we’re doing, it usually doesn’t work.
Andy Baldacci:For that, do you mean employees rather than contractors?
Keith Perhac:

[00:14:30]

No. Because we were a Japanese company, because of legal laws in Japan, we were all contract employees and I just kept that when we moved the company to the US. We’re all contractors. It’s 2 things. First of all, most of us are full time. Then the people who aren’t, there’s an expectation of we’re going to have this many hours each week. This is how much we are committed to you.
[00:15:00]We are committed to you. We have long-term contracts. It’s not like, “Hey, I’m going to hire you for 40 hours and then maybe I’ll hire you for more.” Most of our contracts are 12 months or more. It’s a long-term engagement. If you are invested in us, we are invested in you.
Andy Baldacci:How do you judge that? How do you say that this person is invested?
Keith Perhac:
[00:15:30]
It shows through the quality if the work because there is really no way to tell right away. What we have done is when we’re bringing out someone new, we do a demo project with them, then we’ll hire them for a month so we have a month retainer. Then a 3 month retainer and then we usually go up to a 6 or 12-month after that.
[00:16:00]We work our way up because it’s really difficult to see is this person going to be a good fit? Are they going to be invested in the company? Especially when you’re 6 people, one wrong hire is a large portion of your team that now is dead weight, that’s costing you money every month and not providing any real value for your clients.
Andy Baldacci:

[00:16:30]

Especially at that size, it’s like people think that things … I’m trying to think out of phrases but it’s like when you’re bigger, a hiring mistake isn’t going to potentially break the company. It can reduce morale, it can have bad impacts. You might lose money on it but when you’re a team of 6, one person is a huge part of your company culture, of everything that you’re doing. If they’re not a right fit, it can have a huge impact on the business.
Keith Perhac:

[00:17:00]

I had a guy that I really like working with. I’ve been working with him a long time, but he wasn’t a good fit with the team. It killed me to do it but those dynamics change. They always change and that’s why we’ve been very selective. They say hire slow, fire fast. That’s what we’ve been trying to do as well. We’ve been trying to make sure that everyone fits in, that everyone understands the workload, the expectations and that everyone gets along too.
Andy Baldacci:How did you actually implement this? I know you scaled down to 6. Did you have to let go of clients at that point?
Keith Perhac:

[00:17:30]

Through natural selection. There were a couple of clients who were, “hey, you’re not performing. We’re going to have to let go. There were a couple of clients where we said, “Hey, we’re moving in a different direction.” There were just a couple of clients where the contract was just over. It was not a sudden, “We’re letting go half the company and scaling down,” it was more of, “We’re not moving in this direction anymore. Let’s start phasing out.
Andy Baldacci:I see.
Keith Perhac:
[00:18:00]
The first thing I did was I stopped doing any of the events. We let go of the event planner. I stopped doing any outbound marketing in Japan. I let go of the sales guy in Japan. I let those contracts go down when they expired. I said, “Hey, we’re not going to be picking up the next quarter or whatever. It took about, I think 3 months, 4 months to wean ourselves out of that. It wasn’t a sudden shift where, “Hey, you guys are gone now and hey, clients, screw you,” kind of thing. No, it wasn’t like that at all.
Andy Baldacci:Knowing you, I would have been surprised if it was.
Keith Perhac:I’m so non-confrontational with [inaudible 00:18:27].
[00:18:30]

Andy Baldacci:

You get down to 6 people and you’re buckling down on not just on get me SOPs in place and get in the process in place but also on making this changes to the way you hire. Are you looking at different sources for hiring? Where are you finding contractors to work with now?
Keith Perhac:

[00:19:00]

It’s been all over the place. The best people I’ve had have been through recommendations and they are generally individuals. We had tried hiring a couple of agencies through recommendations and they just didn’t really work. They were agencies that were made to supplement existing teams.
Andy Baldacci:I see.
Keith Perhac:
[00:19:30]
They had a mini team that came in and one person was the lead. Essentially, pretty much what we do, but without the strategy side of things. It didn’t work out for the same reason that we were talking which is they’re not as invested in our success. Maybe the lead is but the developers or the artists or whoever was on the team, the team members were not.
[00:20:00]We were just another client. We had too many degrees of separation of people caring. That was very difficult. What we’ve really been looking to do is finding people who, A, are interested in the work that we’re doing so they’re not just people who are … It’s not just a designer. It’s a designer who’s interested in marketing or interested in learning about marketing if they’re not already or developers who are interested in the type of work we’re doing or building systems that talk to each other because that’s a lot of what we do.
[00:20:30]We’re looking for a new developer and I was talking to a guy who was really into react and the new JavaScript frameworks. I’m talking to him and he’s like, “Yeah. You do all these landing pages. Could we rewrite these landing pages and react?” I’m like, “This is probably not going to be a good fit.” He was very into the dev side. He was very into playing with the technology side of things but that’s not necessarily a good fit for us.
Andy Baldacci:
[00:21:00]
I want to dig into this a little deeper because when you talk about being invested, when you talk about these types of qualities, I’m curious does it come down to just how much they care or is it more to it than that?
Keith Perhac:

[00:21:30]

Caring is a big part. I’m of the opinion that at a certain level anyone can learn any skill. There’s always going to be designers that are horrible but a talented designer can always learn a new design style. A talented developer can always learn a new language and a new coding style. When I say invested, I think it means 2 things.
[00:22:00]One, it means that they care if the company succeeds or not. They’re not just there for a paycheck. They care if they send me a landing page and say, “This took 130 hours to create this landing page.” They care that it’s that versus, “Hey, this took way too much time. I’m sorry but here’s the issues I was having,” or even reach out beforehand. It’s not just a paycheck, it’s something that they care about, what they’re providing and what they’re providing to both me and our clients.
Andy Baldacci:Not to interrupt but do you feel like that is something that’s innate in a person or are there things you can do on the company side to encourage that buy-in from the employees?
Keith Perhac:
[00:22:30]
I think it’s a little of both. I think that definitely there are ways to encourage it and there’s a lot more ways to discourage it which is what you have to look out for. I think that innately all people want to do a good job and they want to own what they build especially in the designer, copywriter developer circles, the circles that we are in. The problem is if someone got to them first and discouraged them or just whip that out of them so that they’re just going for the paycheck.
Andy Baldacci:I see.
[00:23:00]

Keith Perhac:

[00:23:30]

I think that everyone … Maybe this is just me projecting too much. I think everyone wants to build something beautiful. I also know having work for some clients that if you’re not valued, and what you do is always second guessed or taken away from you as far as like, “Oh, you did a design. That’s great. Let me just tweak it all or let’s get on the phone and I’ll show you exactly where to move the mouse as you fix this thing,” which I have sometimes been guilty of but I try not to. I’ve been with clients like that where they just beat it out of you. you are just so frustrated, you just don’t care anymore. You’re obviously not valued.
Andy Baldacci:Exactly. They don’t respect the work that you’re doing. They don’t value you exactly.
Keith Perhac:

[00:24:00]

Exactly. I think it’s just as important if not more for employees or contractors that you’re working with long term because at the end, you can fire a client but do you really want to fire an employee or contractor you’ve worked with for a year or 2, invested this time and energy into because you are not valuing that. You want everyone you work with feel valued like they’re doing a good job.
[00:24:30]That doesn’t mean sugar coating everything, that just means when people come up with a good idea, tell them, “Hey, that’s a great idea.” When they bring something to the table, don’t just dismiss out of hand. Here’s the biggest thing. This is the thing that always use to annoy me when I was just doing consulting is after years of working with a client, let’s say, they would hire a new consultant to come in and make recommendations.
[00:25:00]They would be the same recommendations that I had been trying to push forward for months but because the consulting comes in, he’s new and flashy. He’s like, “Oh my god. This is brilliant. Let’s do all of this.”
Andy Baldacci:You’re just sitting there banging your head.
Keith Perhac:I’m just so upset. It’s like I’ve been trying to get these. This is what I’ve been saying for 3 months. Why don’t you listen to me? That’s the important thing. Don’t discount people, just because they’ve been there forever or they’re not the new freshness. You have to listen and value everyone on your team. If you’re not valuing your team, why do you have a team? Why are they there if you don’t value them?
[00:25:30]

Andy Baldacci:

Then tell me if I’m off base. I’ve seen and talked to a lot of agency owners and it seems like there’s a couple different approaches . I was actually just speaking to Dan Golden who runs a big agency in Chicago and he was talking about getting employee buy-in. When he called, it was like, you want your employees to act like entrepreneurs, to act like owners to really care.
[00:26:00]They have something that’s guiding them so they can make decisions of their own but it’s working towards a better product and better result for the client. They do care about the business on the whole but on the other side you’ll have the more highly productized agencies where it’s checking a lot of boxes and that’s about it. They’re not as invested in their employees because they see it as more replaceable.
Keith Perhac:Cog in the wheel.
Andy Baldacci:Exactly.
Keith Perhac:

[00:26:30]

I think both are valid. I’ll put that up. I think both strategies are valid. It depends what type of company you want to run. Now, I don’t think that they’re completely separate either because especially in each person owns the project has to have buy in as investment, you still need some checklist. You need SOPs, you need something to make sure that no matter how invested someone is, someone is going to forget something. That’s just how people are.
Andy Baldacci:

[00:27:00]

You think that’s important too because if you don’t have those things, if someone has to do this one project a dozen different ways and you’re not happy with any of them as a manager, they’re not getting what they want, that’s going to discourage them and so having some of those SOPs is going to make them not as likely to go crazy and hate their job.
Keith Perhac:

[00:27:30]

Exactly. What I see, usually, I guess we could call them checkbox farms. I don’t know. The productized consulting or the productized services side of things, they usually have one person that has the buy-in. That’s the project manager. Everyone else is just filling out the check boxes, cogs in the wheel. You’re paying one person a lot of money and everyone else is probably paid very little money because they’re just cogs in the wheel, they’re easily replaceable.
[00:28:00]I actually preferred the other way where everyone paid pretty much equal because everyone is equally invested in the success and when everyone is invested that much, I know that I’m paying for smart people to solve problems on their own because at the end of the day, especially with the team of 6, at the end of the day, the person with all the answers “when no one knows what to do.” There’s 20 things that could be done which is the correct one that goes to me.
[00:28:30]The more unanswered questions that people have, if they don’t feel that they have the buy in and the ability … When I say ability, I mean the permission to make those decisions, they all come to me. I think that’s a horrible way to run a company. For me personally, we’re like team 6.
Andy Baldacci:It’s funny because I was just talking to Brian Casel and he has a very different approach. It’s funny because when someone comes up with a client who ever comes up with something, it’s like not on a scope but that requires a change in their process, it automatically has to go to him, then he’ll adjust all the processes to account for that so that next time it doesn’t.
[00:29:00]It’s like if that’s your personality and if that’s a business you want to build, that’s fine. There are ways to make it work but if you don’t want to have this rigid structured company business and you want to let the people solve it on their own, then you need to empower them to be able to make those decisions.
Keith Perhac:
[00:29:30]
Brian is honestly the master of the SOP. I want him to coach me on how to make good SOPs, to be honest. I’ve been a client of his. I talked to him. I’ve been on his podcast. It is amazing what he’s been able to do. Now, the difference between Brian’s company and mine is that he has a very … We’re talking about this, he has a very productized service that he’s providing.
They write blog post. They have a format that they follow and it doesn’t make sense to have something like what we do because we do very much off the cuff what they call done for you …
Andy Baldacci:Bespoke.
[00:30:00]

Keith Perhac:

Bespoke. We are bespoke services. Now, it’s interesting because we always start with a set productized offering. We always start with an evergreen funnel or something similar to that. Something that we know we can produce well and get really good improvements for the client and then we go into, “What do you want us to work on next. This is where we think we’d be good.” Starting from month 2 or 3, we’re really all over the place as far as what we are doing for the client.
[00:30:30]That’s why in our specific case, we can’t do it as a check box because this is each step of the way. We have to have people who have buy-in. We can’t have a developer have coded up a page and just stick it out there when the buttons don’t work or the analytics isn’t there or something isn’t right,
[00:31:00]

Andy Baldacci:

Then a lot of the value that you’re providing to maintain these retainers is the extra strategy that’s going to be more custom to each client. You’re not offering the same exact thing and you’re going to start from a similar place but as you dig in, as you see what works, what doesn’t, you’re going to adjust. You need people who are able to adjust. Like you said, in terms of capability but they’re allowed to, they’re given a permission to because you trust them, because they do have that buy-in.
Keith Perhac:Exactly.
[00:31:30]

Andy Baldacci:

I’m curious. To boil this down a little bit. We talked about a lot but to boil down a little bit.
Keith Perhac:We went way off the rails.
Andy Baldacci:It’s funny because I think listeners a lot of times intuitively they’re going to relate more to your method of an agency. Whether or not, they’re full stack, whatever, full service, whatever they want to call it, they’re going to be doing different things for different clients. Some want to work towards the truly productized service.
[00:32:00]They want to have to do the same thing, build a machine, let it scale and that’s it, but for the ones that do want to stick with this more bespoke route, how would you recommend for them to avoid some of these mistakes with staffing. How would you recommend that they get started, getting this buy-in from current employees or new ones even?
Keith Perhac:

[00:32:30]

The biggest staffing issue that I would warn against is growing too fast especially if you’re a small company, I would never hire 2 people at the same time. For example, no matter how much you think you need it, people always say when you have found that you need a new person, it’s already too late. You need to be hiring about 3 months before you need them.
Andy Baldacci:I see.
Keith Perhac:That’s especially true when you’re small because you have to make sure that they have ramp time. You have to make sure that they’re a good fit. I would definitely recommend doing a graduated one project, one month, 3 months, 6 months, 12 months, whatever contract if you’re able to. Make sure that you’re good working together.
[00:33:00]

[00:33:30]

As far as getting buy-in, it’s something difficult that we’ve been having to work with as we’ve been hiring people. It was much easier when it was just people who have been with the company for years. One of the things that we’ve started doing is whenever we bring on new client or a new project, we have a meeting with everyone. That’s not just all the strategy people or all the designers or whatever, it’s everyone gets together and says, “Hey, this is what we’re doing for this client. This is the process that we’re using. These are the things that we’ve built in the past that are similar, this is how many hours we expect people to be working on this client.”
[00:34:00]Just talk about the client what they do so people understand not only what we need to do but why we’re doing it for this client. Why are we not completely redesigning this client’s site because he really likes his current design and has attachment to it or why are we redesigning everything when everything looks good. They’re tired. Why are we doing the things that we’re doing?
Andy Baldacci:Is that why that informs you or gives them the context so that they can make some of those decisions down the road without having to go to you or just doing their own thing and then when it comes to the client, the client is like, “This is not at all what I was looking for.”
Keith Perhac:Exactly. Which we’ve had a couple of clients where we didn’t do that and that’s exactly what came back. It’s like we weren’t all on the same page here.
[00:34:30]

Andy Baldacci:

I’m curious. For DelfiNet, what does the future look like? I know you’re going to slow things down in terms of growth for growths own sake but do you see yourself staying this nimble highly trained team, highly skilled team or any year from now are you going to keep hiring? Where do you see DelfiNet going?
Keith Perhac:

[00:35:00]

I think we’re almost at the size we want to be. Maybe 2 more people. I definitely want to stay under 10. The goal right now that I have set out is getting internal process for client working, specifically handle. We need to make sure that clients get what they expect, know what they’re getting, how much they’re being charged for what and just have a view of what everything that’s coming down that we’re doing things right.
[00:35:30]Once that is in place and we’ve been working 6 months on this so far, once that’s in place, the goal is to take our SaaS products which we have developed and turn them into essentially clients for ourselves because I know a lot of the team they want, just like they want to own the work they’re doing for clients. They want to own something for us.
[00:36:00]We have 3 internal projects that we’re looking that we want to focus more time on but we can’t have a lot of wasted time going to clients and once we have their processes in place, we can do the exact same thing we’re doing with our clients with our internal projects. That’s the role.
Andy Baldacci:I see. The growth goal, the long-term play is keep the clients coming but then slowly transition the real scale, I guess, you can say is going to come from working on those SaaS projects as though they are clients. That’s where …
Keith Perhac:That’s what I’m hoping.
Andy Baldacci:Right now, you have SegMetrics and summit evergreen. What’s the third?
Keith Perhac:

[00:36:30]

The third one is actually an info product that I was supposed to release next week, that’s not going to happen. I’m working with a team of consultants and they’re like, “All we need is an outline and then we can start.” I have literally not written a word on that outline. I know what the product is going to be about. I know the branding and the positioning but I have no written a single word towards actually creating it.
Andy Baldacci:

[00:37:00]

That actually transitions really well into the rapid fire questions and then again, I’ll go through them quickly but you don’t need to respond in a sound bite. Right now, what is taking up too much of your time so you can’t do things like write that outline?
Keith Perhac:

[00:37:30]

Stress. The biggest one right now is trying to figure out this project process and trying to make sure that things are going smoothly. There’s a lot of shakeup with what we’re doing. we changed our management software. We’re changing the way we manage. We’re changing a lot of stuff. They’re trying to find out how to structure this correctly so that we can be more effective. That is taking up the lion’s share of my mental capacity and my time.
Andy Baldacci:Then if you had that time freed up, what is something that right now, you don’t think you’re spending enough time on?
Keith Perhac:
[00:38:00]
One is writing that outline and starting the course. Then the second one is there’s a lot of things that I’ve been wanting to get out the door for SegMetrics. There’s a lot of A strategy. There’s a lot of features that haven’t been launched yet even though they’re done and because the marketing is behind. I don’t have time to do the marketing I want to do on it.
Andy Baldacci:I see.
Keith Perhac:That’s a big thing.
Andy Baldacci:Interesting. What are you hoping to accomplish in the next month? Hopefully getting that whole thing done.
Keith Perhac:

[00:38:30]

Not explode. The number one thing I would like to have done by the end of this month and I think I just have to put the course on hold until next year which is sad but what I would like to get done is to have to process dialed in so that my COO can take charge of all the clients and that I come in for strategy and building tools so that team can work better. I need to get out of that stressful world as much as possible.
Andy Baldacci:

[00:39:00]

I see. We talked a little bit about the long-term plans for DelfiNet and how it’s going to be focusing on the SaaS. Keep the team small, still work the clients but really treat your other projects as clients. Right now, do you see a light at the end of the tunnel. Is this something where you start at the process of acting all those changes but are you at a point where you’re like, “Alright. Things are clicking now. I have several ways to go but we’re making progress”?
[00:39:30]

Keith Perhac:

[00:40:00]

It’s an interesting question because I think we are making progress. I am fully transparent. I am not a great manager. I’m good working with people. I’m good understanding strategy, managing tickets, managing communication is not my strong point. I know that we’re making progress because it’s getting better but do I see a light at the end of the tunnel? No, because I don’t know. I’m sure there will be but I can’t see it yet. I’m relying very much on my COO and the other people in the strategy team to help me through that because it’s not my forte.
Andy Baldacci:What would have to happen for you to wake up one day, look around and be like, “All right. This is what I was hoping to build. Would it just be not to get called in the middle of the night with a client? How would you know, “All right. I’ve done it. This is what I wanted?”
Keith Perhac:

[00:40:30]

I keep doing this litmus test every now and then. For example, I was telling you I flew to Minneapolis this week for 3 days. I was pretty much out of touch for 3 days. I answered a couple of phone calls and the test is when I come back, is everything on fire or are things okay? I’ve done it a couple of times. Sometimes it works, sometimes it doesn’t. I had a client do this to his team once which is why I think it’s a great idea. He left for 2 weeks.
[00:41:00]I think we went to Thailand for 2 weeks and he said, “Keep the company running.” We had plans, we had things we had to launch. It wasn’t like the company was just sitting still. There were goals that we had to achieve and he’s like I will be around for 2 phone calls during the next 2 weeks unless things go horribly awry. You need to take care of it.
Andy Baldacci:How did it go?
Keith Perhac:
[00:41:30]
It went well. We actually joked that we should call Madame Trudeaux and have a wax model made of him and then we could just have the videographer like take old sound clips and the wax doll and completely replace him. We just take on without him. It went very well. I don’t think that my company is at a point yet where I could disappear for 2 weeks with my COO coming in murdering me.
Andy Baldacci:I’m also not sure what would happen to you if you just went away for 2 weeks. I think you would go crazy and come back after a few days.
Keith Perhac:I don’t know. I had a good time in Minneapolis by the way.
[00:42:00]

Andy Baldacci:

That’s good. It does seem like you’re making progress and I think the way your personality is, is that you’re going to take a lot of this on mentally yourself and really tie into that but as an outsider, it does seem like you’re making progress and so I’m excited to see hopefully in 6 months to see what’s it’s like and see the changes you’ve done. Are you going to MicroConf this year?
[00:42:30]

Keith Perhac:

I am. I’m going to a starter and then I’ll probably be around for build as well. I’ll be just hanging out in the lobby for Bill and then I’ll actually come into 10 starter. There’s one thing I want to mention because I hit on something there which is as a business owner you have to decide what you are good at, at the business and focus on that.
[00:43:00]Brian is great at building those SOPs. He’s great at building that process so that other people can follow it. I am great at coming up with the ideas and strategy that are going to grow the company. You have to hire people who can do what you can’t or what you’re not willing to do.
Andy Baldacci:

[00:43:30]

It’s funny. I actually was just interviewing Casey Cobb who runs an agency over in San Francisco and his big thing is what’s called the DISC personality test. If you take this, it tells you what dimensions you excel on, what you don’t and it gives a lot of insights into just how you operate as a person which is one, makes easier to identify intuitively like these are tasks, not that I’m not good at but they’re just not suited to me. It also helps you understand other people on your team in how they operate because when you get a lot of different personalities in the mix, when your team does start building, these things really matter.
Keith Perhac:

[00:44:00]

It does. People have a tendency to think that everyone acts and thinks like they do. It is so not the case. There’s just so many different ways that people come into problems and come up with solutions.
Andy Baldacci:

[00:44:30]

In just the past few weeks, after talking with Casey and going through some of those assessments myself, it’s like, “Wow. Now, I can understand why certain things I do just completely annoy my girlfriend when I think I’m just being normal and all of these other things. It’s like, “I get it now.” To wrap things up, Keith, I’m curious, if listeners want to follow along to see what you’re up to at DelfiNet to see about some of your projects, where should they go?
Keith Perhac:The best place that has everything we have is called Developyourmarketing.com and that has the agency pages, has link to SegMetrics Summit. Great way to get in contact with me and everything. Everything we do right there, Developyourmarketing.com.
Andy Baldacci:Awesome. I’ll make sure to get all of that link in the show notes. Keith, I just want to say thanks again for coming to the show and for sharing everything. That was a really fun talk for me.
Keith Perhac:Thanks so much, man. It was great.

Want to learn more?

To follow along on Keith’s journey, follow him on Twitter or head to DevelopYourMarketing.com where you’ll find information on all of the projects he is working on.

Resources mentioned:

Keith’s Mixergy Interview
Brian Casel on Scaling Your Agency with Productized Consulting
Dan Golden on Building a High-Performing Team with Open-Book Management
Casey Cobb on How to Avoid Accidental Evil
Segmetrics
Summit Evergreen