Why we suck at business
This morning I received an email from a designer who I’ve been in contact with digitally. We are connected on Facebook and have shared the occasional back and forth through it. In his email he noted that he’s just started out on his own and is finding himself discouraged by how challenging this path is. He commented that I’m someone he admires, and that my feedback would be helpful.
Obviously, such emails are flattering. It’s really nice to hear that others feel that we’re doing good work and take the time to let us know. At the same time, I feel at odds in imparting any kind of advice on this topic. The truth is: I’m not a good enough business-person to be any kind of an example–far from it.
smashLAB has now operated for just over eight years. It has been a good run so far. We’ve grown a great deal over that time, and I think we’re all the better for it. The downside is that we have no money. Seriously, we’re running on fumes. We love what we do, and we work hard at it, but we’re really awful at making money from our efforts.
I suppose we really could have cashed-in on Design Can Change. We could have packaged smashLAB up as a “green design” studio and used DCC to lead traffic to us. We just couldn’t do that sort of thing though–it just seemed unethical. So, instead, we send traffic to members, but haven’t really seen any work as a result of this project.
We’ve also been too picky. Some clients have come to us with cash in hand, but we’ve felt uncomfortable about what they were doing. When our radar has given us the “weird” vibe, we’ve chosen to skip such people and wait for the next ones to come along. Sometimes this has even meant parting ways with clients who just didn’t seem like good people. This has (thankfully) only happened a couple of times, but it has hurt us financially.
We could certainly hire a sales person to build our business, but I’ve always been a little reluctant to do so. It seems that whenever that conversation starts, something important about what we’re doing gets lost. All of a sudden, we’re just chasing a dollar, instead of concentrating on the work. Plus, added overhead seems to bring with it the need to rush jobs through and focus on bottom-line, instead of quality.
We run on a trickle of gas (often fumes). Doing so, however, has allowed us to do things we like, and operate with principles.
We have earned a strong reputation. We’ve been told amazing things by our existing clients. Eric at illumivision recently recounted to us that their international sales are up around 225% as a result of our efforts. Mark at the Sustainable Endowments Institute met with us for beer a couple of weeks back and applauded how effective their Green Report Card site is.
It seems that every quarter, some larger operation offers to buy us; additionally, we get a lot of offers to work for the “big guys”. We keep responding with a polite “thanks, but no thanks” though. It’s not as though such offers aren’t compelling, but as I noted, we’re not good at the money thing. Or perhaps it just isn’t as interesting to us as the work. (It sure would be nice to buy a condo though.)
The challenge, in my mind, is that the “smart play” in the short-term financial sense often compromises one’s long-term opportunities. It was safer for me to stay in my union-job than it was to start smashLAB with my friend Eric Shelkie. That safety, however, would have come at a high cost.
I could have never experienced as much in that role as I have by taking the risk we did. Likewise, we could add a sales-person, start to “turn-around” projects as quickly as possible, and find more creative ways to bill our clients. None of that, however, seems particularly appealing. In fact, I tend to think that doing so is what might lead one to a mid-life crisis a few years down the road.
So, instead, we just plug away, and I can tell you that at times it’s far from pretty. Along the way though, we get to work on some really neat stuff! As broke as we may be, it feels good and I think this is particularly important. And who knows? With the numbers we’re starting to see on MakeFive, we might actually make some money off of this thing some day!
I write this in part because I’m guessing that there are a lot of us out there in a similar spot: good at what we do, and truly passionate about it, but perhaps not the best on “cashing in”. The sad part is that it’s seen as a weakness to admit this. To many, the notion of acknowledging that they aren’t seeing the success they had hoped for seems out-of-the-question. Well, I can fairly say that we had much higher expectations for our “comfort of living” when we started out, eight years ago.
I ended my response to the designer who contacted me, suggesting that he just work more. I noted that this is important as it keeps you active in your destiny, and distracts you from the hurdles you might be facing. Plus, even though the remuneration is often disproportionate with the effort one puts in, this is certainly a pleasurable kind of work to do.
As I reflect more on his question, a few core things continue to roll about in my mind: do good stuff, stay humble, operate on the cheap. I don’t know if any of these will pay-off, but it’s the only way I really know how to work.
Eric
Hey you fight the good fight. Sometimes that means you don’t cash in, but down the line you’re rewarded.
Eric
Eric,
Thanks, nice of you to say. :-)
Cheers!
Eric
(This Eric thing starts to feel weird, doesn’t it?)
Have you ever considered that your core values - do good stuff, stay humble and operate on the cheap - come from being a northern boy? I know a lot of people here in the Yukon run their business, and their lives, exactly the same.
This not-good-at-business post actually shows some good r.o.i. from your services, turning it into a good-at-business post.
It sounds rather cliched, but it will all “work-out-in-the-end”. You do great work, and you don’t need to be told so. The quality of the product will eventually pay-off, it almost always does…
Money is great, we all need it, but, from experience—when I have lots, I’m not really that much happier. You didn’t get into this to become rich, you got into it feed a demon. When the demon (I think you know what I am talkin’ about) is not fed, no matter how much $ you have in your chequing account, you’ll still feel that feeling: that something is incomplete.
Sure, I want more $, who doesn’t—actually, I want way more (we run on fumes as well), but I also want to be happy. I think I’ll start taking more drugs to numb it all away (tee-hee)…
this is an honest and thoughtful post, Eric.
I guess I’m wondering… is it possible for you to make some strategic decisions that don’t compromise the work but get your the earnings you deserve? While that may not come under the heading “work harder” it may just pay off as an area worth looking at.
Keep on truckin’ Karj!
Hi all,
Thanks for the comments–nice to get so much feedback to the post!
Geof: Could be. I think that things were so lean in Prince George that we started to see the world through that lens. (Which is both good and bad.)
Jason: I wish I were smart enough to have been that strategic. ;-)
Craig: Thanks for the kind words–nice of you to say!. I agree about the drugs. (I prefer red wine and scotch.)
Seth: Glad you liked it, and thanks for the suggestions! We’ve been talking about just this over the past months.
Jon: We will keep trucking.
Cheers!
Eric
Maybe this post will stop all those offers from PR services Eric. ;)
I’ve been lucky enough to work with nice people, but not people that have paid a whole lot. What keeps me going is sort of an altruistic sensibility toward my clients and good design in general. I can’t chase the Target, Nike, Coke type clients. Though I don’t think I’d be most effective in that arena, so I actually like doing work for small to mid size businesses. Those that actually can benefit the most from my help.
In a healthy market perhaps, it might not be a strategy worth pursuing as its more work for less money, but as I’ve grown use to it, I appreciate every dollar that much more and spend it more wisely. What is even worse is that when I talk to friends with agency jobs, their banks accounts are on fumes, which I can never understand. I guess they took Kanye’s words “let’s go on a living spree” a bit literally.
So what I’m hearing is…that I’m always going to be broke.
Damn.
[...] Anyhow - those are the words of advice we would [so far in our journey] have offered had we received the letter that this guy did. [...]
Great post, I enjoyed the read.
However, it sounds like you have had opportunity to make more money, you just haven’t taken advantage of any of those opportunities.
I’m not telling you to adjust your morals and values, but not everything in business is always glamorous. My suggestion would be to either keep your morals and ideas the way they are and realize that you might not get rich, but you will be happy with yourself and your work.
The other alternative is to work on projects that might not make you “happy” all the time, but provide additional income so that you can pay the bills and to live a comfortable life - so that you can stick with your career and work on the fun / artsy projects as well.
Eric, thank you so much for a great post, it comes at a right time and hits close to home! I wish my company had the balls to refuse some clients, that clearly do not bring anything but bad experience (definitely not the money). My fiance, who is also a designer, already had this epiphany and switched from enriching sugar water and sneaker companies to helping one of the largest environmental company.
I also saw on your site mentions of agile and iterations. Have you successfully implemented the methodology into your process, or just adapted some parts of it?
I have been broke for the past 2 years, with the chance to “cash-in” twice. But you know what, I had so much time to learn so many things, so many experiments to try out, so many wonderfuly fun self-initiated projects that I would not have done this another way.
I mean take a look at smashLabs side projects, they are amazing. People would be missing out if you took the “cash-in” projects and had no time for Makefive or Design Can Change.
So really, just create and enjoy. Right?
Hi all,
I can’t believe how many responses there are to this post. Thanks! It’s nice to hear so many positive things from all of you!
Josh: I agree. We often look at this sort of thing from the “output is more important than input” perspective. If you keep your costs low, you can gain a lot of freedom to do what you wish.
md: Nope, that’s not the case at all. But if that’s an important point, I suggest looking for an agency job. ;-)
Cam: You’re right, and we’ve discussed this at some length here. Curiosity is often what keeps us less financially “set” than we’d like to be. We love taking on new projects and often without the return on investment being the primary concern.
I should also note that I’m not so much complaining about our spot as I want to acknowledge that reality is sometimes quite different than perception. The designer who emailed me seemed to think that we had some knowledge that he didn’t. I just wanted to make it clear that we stumble about as much as anyone.
victoria: We’ve only parted ways with a couple of clients like that, and each time I dreaded the process. It felt a lot like “breaking up”. That being said, it sure is nice to work with people who don’t make you feel bad.
Regarding your question of process, we have implemented a pretty solid method of working. We started to craft it pretty early in our company’s existence, and have refined it over the years. It’s likely not that different than what most groups do, just augmented to work best for us and our clients.
Adrian: Thanks! It’s great to hear things like that. Glad you have enjoyed those projects. We sure have had fun working on them!
Cheers!
Eric
I’ve been thinking about hiring someone to handle the sales side for a while now. I’m just not good at putting myself out there. But they would have to have a background in design for me to feel comfortable with it, and most designers don’t want to get stuck in sales.
Hi, my name’s Dan and I suck at business.
When I get down on myself I think of my family & friends, my colleagues, the work I produce and my place in the community. When I do I always come to the same conclusion:
What I feel is lacking is simply “more stuff”. I want more stuff all the time. I can’t help myself -I ain’t no monk.
For me it’s just consumerism talking. I am a victim of the same monster that, as a photographer, I am often complicit in feeding.
What am I motivated by anyhow? Money never feels as satisfying as creating a great image.
I try to remember to do more of what I love and most of all -covet less. Walking around an art gallery usually helps too.
That seems like a good idea John–I’ve often had the same thought. The trick is to find someone who understands your offering well. I’ve found this tricky.
Dan, I’m completely with you. As long as there’s enough cash to keep going I’m happy. When it gets tighter than that though, I’m less chipper. ;-)
Geez. Now I feel bad for having taken some shirts.
Don’t worry about it Bill!
We like to clothe fellow designers. ;-)
Thats what I mean…I can’t do the agency thing. Theres no way I could ever do this “for the money” so I’m doomed!
Yup. No gold-plated Porsche for you. ;-)
I still think part of it is to keep costs low. That way you don’t need to make that much. Thank goodness for Craigslist!
Hi Eric,
Even though I have a lot less experience than you, I can empathise with much of what you say.
Does your current position make you yearn for more reward, or are you contented with your business / family life?
In self-employment, many of my contacts want to compare themselves to me, seeing who’s “doing better”. The truth is, and contrary to popular opinion, we don’t all want the same thing.
I respect you for not chasing the money, and believe you’re happier as a result, but if it’s leaving you wanting more, then all the very best with those strategic discussions that have been taking place. I can only hope you continue to impart your knowledge on the subject, so I can continue to learn each day at a time.
All the best.
Hi David,
Thanks for the kind words. :-)
I’m a pretty happy guy. I have a lovely family, and I work with good people on projects that we all feel strongly about. There isn’t much I’d change about this picture.
My reason for posting this is largely from a few emails I’ve received, which seemed to imply that we might have some knowledge that others do not. I just wanted to be clear that we struggle with the same stuff that everyone else does.
Sometimes I think this kind of thing gets lost due to an antiquated notion of “professionalism”. Most companies aren’t comfortable with the notion of telling anyone that there’s any shortcoming in their expertise. This always seems perverse to me. We don’t know everything. We can’t know everything. Why pretend otherwise?
Glad to learn that some of this is helpful. It’s nice to hear that from folks like you. I like the design community. It’s nice to share what we’re finding out with one another. :-)
Cheers!
Eric
What a great post! I hope my comment is worthy of it.
I was in the same situation my self not so long ago, I ran a small Web design / development company in a small town.
I took on other freelancers to get the bigger jobs done but mostly did every job myself. I was constantly working for small environmentally conscious companies and delivering way more than I should have for the money I was charging.To say I was running on fumes is a bit of an understatement, I would take large jobs and deliver on them perfectly but once I had covered my costs I was making less than the minimum wage for my time.
I got by doing this for about three years and was happy with it but I never had any money for the nice things in life.
You could say I got lucky, but I think that my hard work paid off: I got ‘Head hunted’ by a mid size well established marketing firm who offered to make me their lead designer for interactive media. This was a bit of a predicament for me as their headquarters was 200 miles away in a city I would never have chosen to move to, but they offered me a decent salary and the opportunity to head their web team.
It meant moving away from all my friends and having to cut off relations with existing clients but eventually I decided to take it. I now head a team of about seven developers and four graphic designers plus have a twelve man sales team at my disposal and almost complete control of the clients I pick. I love my job and have enough money each month to do things I couldn’t afford before. But I do feel like a complete capitalist and spend my days putting the enthusiasm and creativity I used to put into my own business into making other people richer. On the plus side I now have all my spare time to work on my own projects that never would have got off the ground in my old situation. I also gain so much experience from working with corporate clients everyday that If I ever went back to freelance work I feel I would know exactly what to do to be successful in happiness and business.
What I am trying to say is that there is a middle ground between agency style work and small business or freelance work that some might find comfortable (as I myself do). At least for a while.
Sorry I should get my own blog. Feel free to collapse/condense.
Joe
Hi Joe,
Thanks for dropping by and sharing your story–it’s nice to hear how well everything has worked out for you! :-)
Cheers!
Eric
Wow, what an unbelievably honest and down to earth post.
Thank you for sharing.
Stu Collett.
Thanks Stu–glad you liked it! :-)
Most creatives faces the business ‘aspect’ hurdle.
I think the challenge is also the fact that when creatives meet a client, the first thing that comes to mind is an opportunity to create a masterpiece.
And on the other side you find non-designers building successful design empires.
This might be because whenever non-designers see a potential client, they see an opportunity to create an income, then maybe a masterpiece but money comes first!
I also experience work-flow drought from time to time but with my passion and a lot of coffee, I use my skills to create stuff:
http://www.skout.co.za + http://www.wordstheater.com
I force a challenge to be a blessing ‘cos if it weren’t for the drought this projects would have never existed.
A very humble and honest post Eric. As a recent graduate trying to freelance my way into the profession, I must admit, I can relate to a lot of the things you mentioned here. I also struggle, but like you said, “you just got to keep plugging away.”
As you mentioned, it’s about doing what you love to do. I guess, for me, it’s not about the money or becoming rich, but about the fulfillment of knowing that you did a good job.
“Be good at what you do, and work will come to you”, as someone once told me.
Sounds like you got a good heart Eric. I truly hope and wish the best for you and yours, and your company endeavors. Thanks for sharing your thoughts and experience.
Thanks David–glad to hear that the post was helpful. :-)
I like what you’re saying and agree. The trick is to keep enough gas in the tank to keep running. From there on, everything seems to work out!