Can a win destroy an agency?

Can a win almost destroy an agency?

Short answer: Yes.

Long answer:

End of year. The leadership team is staring at their numbers and it's not pretty. They're going to miss their EBITDA targets, which means they're going to miss their bonuses. And if you've ever watched senior leaders do math on their bonus shortfall, you know what comes next.

They decide to push hard on one-time projects. Sell anything with a pulse. Get deposits collected before December 31st, whatever it takes.

So they do. They sell a bunch of work - and they sell it cheaper than they should, because they're not playing the margin game anymore. They're playing the calendar game. They just need the cash to land before the year closes out.

And it works. The deposits roll in. They hit their number. Bonuses get paid. Everyone's happy. High fives all around.

Except nobody's thinking about what happens in January.

All that work they sold at thin margins? It still has to get delivered. The team still has to do it. And because it was sold cheap, every hour spent on those projects is an hour that's barely breaking even - or worse. By mid-January, the damage starts showing up in the numbers. By February, it's undeniable. They'd hit their year-end target by borrowing from the future, and the future showed up to collect.

This is something I come back to over and over again: why you win is more important than if you win.

Could they recreate that result? Of course not. The whole thing was a sugar rush. It felt great in the moment and left them worse off a month later.

And that's the question I'd want you to sit with for a second.

Because this doesn't just apply to year-end scrambles. It applies to everything.

If your agency hit 40% EBITDA last month but you can't point to exactly why, you shouldn't count on seeing it again this month. If your churn dropped below 2% but nobody can explain what drove it, don't be surprised when it spikes back up. A win you can't explain is a win you can't repeat. And a business built on wins you can't repeat is a business built on luck.

Agency has a great month. Owner's feeling good. Team's feeling good. Momentum seems real. Then I ask the most boring question in the world: what specifically drove that result? What behaviors, what systems, what decisions made this month different from the one before it?

And I get nothing.

Which means they have absolutely no idea whether it'll happen again. And more often than not, it doesn't. The next month is mediocre. The one after that is rough. And now they're back to wondering what went wrong, when the real problem is they never understood what went right.

The agencies I work with that scale well are almost annoyingly obsessive about understanding causation. When something goes right, they dissect it.

What did we do? What process did the team follow? What was different about this client, this project, this particular combination of people? They document it. They turn it into a system. They make the accident repeatable.

And when something goes wrong, they do the same thing. Not finger-pointing - understanding. What broke? Where did the process fail? What behavior or decision led to this outcome, and how do we make sure it doesn't happen again?

Because once you understand why something happened, you own it. You can make it happen again on purpose. Or you can prevent it from ever happening again. Either way, you have control. And control is the whole game.

Without it, you're just hoping. And I've never seen an agency scale on hope.

The thing that ties all of this together, and it's something I think about a lot when it comes to churn specifically. Sales tactics change all the time. What worked last year might be dead this year. The algorithm shifts, the market evolves, your competitors copy your playbook and suddenly it's not a differentiator anymore. Even if you know exactly why you won those deals, the landscape underneath you is always moving.

But the reasons clients stay? Those are remarkably stable. The behaviors that drive retention - trust, communication, delivering real results, creating an experience that makes people feel like you give a damn - those don't get disrupted by a platform update. Human psychology doesn't release quarterly patches. The fundamentals of why someone stays with you for three years instead of three months are the same today as they were a decade ago.

That's why I'm so relentless about building retention systems instead of just chasing new revenue.

New revenue is important. But it's also unpredictable.

Retention, done right, is the closest thing to a sure bet that exists in the agency world.

Nick

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