3 Mistakes That Are Stimulating Your Professional Services Business Growth

Professional services firms make up the majority of the small business landscape in the US. Most never cross the seven-figure revenue mark or even see it on the radar. They are often dominated by a few loyal clients. Hard-driving founders work 24/7 to get projects done and, if a client asks, they’ll sell the few minutes they have free each week to take a breather. They are highly dependent on the owner’s time and talents and are notoriously difficult to scale and monetize.

My partner and I eventually grew our professional services firm to nearly eight figures when we finally discovered that the biggest opportunities tend to go to the biggest businesses. We were able to sell and deliver to our clients. But with both of us playing all the roles in our business, we were struggling – and the customers knew it. They saw us doing a lot of work with companies and they got used to getting emails at all hours of the night when we finally had free time to answer their questions. They tend to give more and more conversations to other firms because of our limited bandwidth. We have lost millions of dollars on opportunities we thought were slim.

We broke the million dollar mark and continued when we started thinking like a big firm. We discussed the big game early on and took the credit for hiring consultants and vendors to get there. It was hard, and there was no sleep at night. But we soon began to see more opportunities, current clients expanding their range of services with us and competitive opportunities that we had not been included in before.

Here are three ironclad rules that have driven our success:

Related: 4 Tips to Build a Million Dollar Business

1. Start selling your company, stop selling yourself

Unless you can charge tens of thousands an hour or cover a few times, you will never make that much money selling your personal skills. You need people – or at least the illusion of lots of people (until you get bodies on the ground) to get real income. Our way? We found out what customers liked best about us and rewrote our marketing materials to include words like “our team” and “our approach.” Behind the scenes, we’ve created a training guide and videos for new employees to learn how (and why) to sell themselves.

2. Resist the temptation to save on salary costs by hiring inexperienced consultants

Our success was ultimately tied to our willingness to hire well ahead of the curve and put a team of professionals in place that promised our new marketing materials. The biggest rookie mistake we’ve made is hiring people who are part-time or have less experience than the business needs. Instead, we hired experienced big hitters who were bored with corporate America and looking for a new challenge.

We couldn’t meet their very high salaries, but we helped you with flexibility and independence. In a few cases, we have offered equity in exchange for quality of work, tenure and sales. But we took a big part of our success by living on reduced wages for almost two years. It was a slog, but it allowed us to make a few key hires that were critical to driving the business and helping us hire more stars.

Related: How I Built a Million Dollar Business in 12 Months

3. Don’t gamble with sales

We were passionate about our company’s best sellers. Unfortunately, we were also the head recruiter, head planner, lead administrative assistant and bookkeeper. We didn’t have enough time on the day of the sale. But if you don’t sell to a service company, you’re dead in the water. Another option is to invest (heavily) in marketing.

We hired someone to identify and aggregate opportunities, giving us more time to focus on closing great deals. Maintain seller compensation risk. We have implemented a compensation system with incentive tiers and built in large bonuses to achieve the highest numbers. Our first seller doubled his income every year when he finally crossed the $2 million threshold. We made money, he was a happy employee, and my partner and I forgot (almost) about sacrificing a few months’ salary to bring him on board.

These days, it would make more sense to invest in a marketing platform like Hubspot, Salesforce or thousands of other new competitors to do the heavy lifting. When we sold our company, about 50% of our new $100,000-plus consulting deals came through these tools. Make sure you save some money on the budget of the marketing platform. It took us some time to adjust our system and stop about two-thirds of our emails from being caught by spam filters.

Related: How to Scale Your Small Business in 8 Steps

In general, the bigger your team and the more they can do without you, the higher your revenue and profit. Put your time and talents into growing your company’s value – don’t commit to it – and you’ll be rewarded with record sales and pay that will more than make up for any sacrifices you make along the way.