What they don't tell you about owning a creative small business
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Creative Small Business

What they don’t tell you about owning a creative small business

This past weekend marked the 12th yearfrom my last full-time job.

Granted, that previous statement looks a bit misleading. Since then, I’ve worked enough to account for 3 fulltime jobs, but it specifically holds a special meaning because it was the beginning of my Self Employment.

It’s been a long road getting here, but despite the bumps and bruises that are typical of small business ownership, especially in the creative field, I wouldn’t trade it for the world.

Stick with me on this…maybe you can avoid some of the mistakes I’ve made in getting here.

If you’re looking for all the answers or some catchy definitive guide to solving everything…you won’t find it here.

This is just my story about starting and running a creative studio and some of the gotcha’s that nobody really talks about because shooting, designing, and producing is so much more fun.

Resignation Letter 2008
Clever Naming Convention, Huh?

Way back to the beginning

Penn Paper - The Office
They must have painted out the moss for the intro titles.

Before I decided to hand in my two weeks, I was sitting at an outdoor bar in Scranton, PA with a friend of mine.

We were obsessed with “The Office” and wanted to check out that Penn Paper building at the beginning of the opening credits.

So, we were sitting at this little bar sipping coronas, and I was ranting about all the things I would do differently. All the things I would fix.

It’s so funny looking back to see how full of piss and vinegar I was. Ready to take over the world and make meaningful changes in the industry.

My buddy sat there. Quiet, the whole time; just listening. I stopped my rant (I tend to be very Sam Kinison-like in my rants) to take a swig of the beer when he chimes in,

"Why don't we just start a company then?"

That hit me like a ton of bricks. I had never considered going off on my own with no safety net, no guarantee of pay, or even a remote form of guidance on how to run a business. But it sounded sexy.

If these guys can do it, then why can’t I? I’m smart. I have passion.

Boy, was I naive! I think I’m still just as smart…maybe even more passionate. But what I didn’t think of, or know of for that matter, was what was involved in starting (and sustaining) a new business.

Well, I’m pretty obsessive and I couldn’t shake off that idea. It stuck with me, and after we parted ways once we got home in CT, I spent all night researching the steps to begin.

For those of us who are young, dumb, and broke, it is a pretty steep learning curve to figure out what the State, IRS, and Federal Government want from us. Youtube didn’t exist at that point, so forget about that. I was relegated to combing through the websites to see which form I would need to fill out, all without the assistance of a lawyer to help guide me.

Luckily, I had experience in web design, so getting started on our website was a breeze. I was already doing graphic design and video editing on the side. That all helped.

It took me a few days to gather my courage, and I submitted my two week’s notice on Friday the 13th. Who the hell would plan it like that?

Me, that’s who. I threw caution to the wind and didn’t even glance back.

Fast-forward through time, I’m still in business. Took a ton of punches along the way, went through a partner, a business name, lived in multiple cities and months of lost sleep. I now have a great group of peers that I work with and I’m proud of the systems that I’ve built. But, like many small business owners, I am never satisfied.

There is always something to improve.

For those in the creative field, everyone knows the lie we tell ourselves.

Build it and they will come.

The truth is that is just a dream. As creative business owners, we need to start balancing our areas of focus— dedicate just as much time, if not more, to the business aspect as we do on the creative end. (I know, it’s heresy to say that).

Joel Pilger from Revthink is a great resource that helped open my eyes to this. I had told myself for my whole career that if my work got better, then people would be fighting to give me their hard earned projects.

Sorry Paulie, it takes more than that.

We need to build it, but also support it. Otherwise, the whole thing crumbles down.

I’ve been thinking a lot lately, given the current state of affairs, and I’ve been trying to break down some of the common pitfalls that I’ve encountered and affect all business owners, but especially new business owners.

Here are some things to consider:

Website and SEO (Search Engine Optimization) –

God, I hate this term so much. In my younger days, I was so cavalier in not putting in the time to optimize my site. Nowadays, good SEO is mandatory for any business, and even if you aren’t technically savvy, it is important to understand what it is before you pay someone to do it for you.

How can you pay someone to fix something but you don’t even know if it is broken in the first place?

I’m not a professional on SEO, though. I am a Creative Director, so I will leave those articles to the experts.

NeilPatel.com and Backlinko.com have some great resources to build up your understanding of what goes into it.

Seriously, check them out…they’ve helped me immensely.

If you’ve got some dough to invest, check out Semrush.com. It’s a great tool to measure website performance and run some tests for keywords and backlinks against your competitors. It has a bit of a learning curve, though.

Make sure that your website works too. If you aren’t technically inclined, there are plenty of services such as Wix.com, Squarespace, and Shopify, that can help you create your website, and customize it to fit your brand needs.

Generally speaking, having a website and having an SEO optimized website are two totally different things. Learn how it impacts you.

I repeat, good SEO is mandatory for every business that wants to grow their web presence. For many years, I made the mistake of relying on referral business to keep me growing. That segues me into the next point.

Sales

Sales, blech! 😭 We are reminded of the image of the scummy car salesman, or the shady vacuum dealer.

But that’s a bad stereotype. If you speak to any good salesperson, it is immediately clear that they benefit from your increasing knowledge of a subject.

Dwight's Speech - The Office
Credit: Giphy.com

A good salesperson informs and relates to the prospect. They serve as a guide to help you.

Granted, their job is to sell and they are usually paid on their merit, but the ultimate goal is to provide knowledge and work to figure out what is best for both parties. This results in sustainable, long-term relationships; not carnival-style, pack up and leave town transactions.

A strong sales system is necessary to manage cash flow and ensure that you are making the most money that you can while assisting clients in achieving their goals.

For years I’ve made the mistake of not knowing how to sell myself and my studio, and it’s resulted in lost opportunities.

Perfecting your elevator pitch and knowing exactly what makes you special is your biggest weapon in presenting the best “you”.

If you take pride in your work, there is something special you can offer someone. You just need to figure out what that is. Be bold and shout it from the rooftops.

People don’t buy products. People buy from people. People buy based on feelings. People want to work with others that share their same values.

Work hard. Be nice to people. Articulate what makes you great. Rinse and Repeat.

Inbound vs Outbound Marketing

What is the difference between the two? What do they mean?

Inbound marketing is focused on driving traffic to you, and converting leads into sales by educating the customer. Typically, you would capture customer data on your website in exchange for some sort of useful information or guide.

Outbound marketing, on the other hand, is what we typically think of when the term marketing is brought up. Advertising, Cold Emailing and Calling are some examples.

Once you get busy, marketing is the first thing to fall by the wayside. To this day, I still struggle with maintaining a balance between the two.

Again, I’m not a marketer by trade, so I won’t delve too deep into this, but these sites have some great resources:

Inbound

Hubspot.com

Impactplus.com

Outbound

Close.com

Pipedrive.com

For our sales process, we use Pipedrive to keep us organized. It is a great CRM (Customer Relationship Management) tool to make sure that potential leads moving through the sales pipeline aren’t being ignored.

Using a CRM saves so much time in the end…I can’t tell you how often we would forget when we last messaged prospects, and had to guess which form of communication we used. CRM’s can keep track of that stuff for you.

Pro Tip — Be a damn human and write down people’s birthdays for Pete’s sake.

Treat clients and prospects like they deserve to be treated, and show a genuine interest in them as a person. If you don’t know their birthday, then wish them a happy holiday when the time comes.

Do something to show them that they mean something to you. It’s five minutes out of your day and it might be the pick-me-up that they need.

However, don’t use this to be manipulative, because people will spot it a mile away. Nobody likes that guy/gal.

Processes

As Mike Michalowicz always says, a company lives and dies by its processes. New businesses need to establish processes for things such as Sales, Operations, and Production.

As a process junkie, I am always trying to punch holes in the way we work to see if we can optimize for efficiency and communication.

For example, let’s say a new job comes in and you don’t have an established production process.

How do you start? What do you do if a client makes a change? How do you create a schedule for determining when the work would be completed?

These are all easily answered by creating repeatable processes.

I know what some of you are thinking, “Well I’m a freelancer so I only need to keep track of my stuff”.

This is important especially to those who work by themselves, as there is no one else to keep track of accountability.

By the time the client starts doing it for you, you are already losing them.

Gordon Ramsay Yelling

During a grind to finish up a job, it is easy to let some things slide just to get it done, but think of your good friend Gordon Ramsay criticizing you, and stick to the plan.

Is the job going out of scope? Well, then you need to charge more.

Has the work timeline been extended? Is the client past due on their invoice?

Having established guidelines help remind you to keep things in order.

Organization is next to godliness.

Delegating Tasks

As a business owner, it is imperative that as soon as you can create your systems, you start delegating tasks to others.

Small business owners have to wear many hats regardless, but is it efficient for you to divide your time doing menial tasks, while simultaneously trying to grow the business?

Again, learn from my mistakes. I had tried to juggle everything for years, but not until I started delegating work, did the profitability of my business increase, as did the amount of completed internal projects, which helped drive growth.

You gotta spend money to make money

It seems counter-intuitive, but spending some money on getting help from others freed my time up to look at the work we were creating more objectively. This ultimately increased the quality of work, as well as increased profits with me at the helm managing the processes, instead of focusing on executing all the labor.

Here’s an example. Let’s say that you have years of prior experience working for a Creative Studio. You have a high level of expertise and you ventured into creating your own company.

Your level of experience dictates that you should make around a certain amount of money. Would it be prudent for you to be doing all of the video editing and motion design when you should be focused on producing or directing?

I didn’t think so. Delegate, delegate, delegate. Surround yourself with talented people and give them things to do.

If you can’t afford to because your business is brand new, then check out sites like Fiverr or Upwork, to help you out until you can hire someone that you want. There are also a ton of freelancers across the globe who would love to work with you.

If you can’t afford to and your business isn’t new, then there is a good chance that:

  • You are not charging enough
  • You don’t have efficient processes in place to hold you accountable on time or money

Accounting

Finding a good accountant and learning how to manage your money is so important.

Depending on the business you are in, your bookkeeping needs can be more or less than others, but getting set up in bookkeeping software and maintaining good fiscal responsibility can make or break your business.

We use Quickbooks Online, but I hear great things about the Quickbooks Desktop version as well as some people using Freshbooks.

As a self-employed individual, it makes life so much easier if you keep your personal and business finances separate. Different bank accounts, different credit cards, different expenses.

This will help you in the future if (God forbid) you get audited, apply for grants, seek investors, or just to have a clearer picture of how your company is performing for growth.

As much as I hate to admit it, Profit & Loss and Balance Sheet documents are your friends.

I am not a technical guy outside of the creative industry, so it has taken me some time to fully embrace the data, but it is certainly something that cannot be ignored.

Wrap it up, Melluzzo.

Some of these points I’ve hit might seem to be glaringly obvious problems to solve, but in my experience, it’s easier to ignore the obvious problems while you are focused on specific details. Like every boxing coach worth their salt would say:

Funadamentals win fights.

These aren’t the sexiest topics to think about, much less act on, but they are the oft-forgotten/ignored building blocks that your creative business stands on.

There are many other things to consider when starting and sustaining a business, but these are the ones that sit at the top of my mind all the time.

I hope that this has been informative to those who are in a similar situation as I am and have been. If this article does it’s job, you should have more questions than answers. Luckily for all of us, Google exists. Use it…abuse it.

Doing great work will only get you so far if you don’t have all your ducks in a row.

To summarize, here are some of the key takeaways:

  • Understand your internet presence and how it affects outreach and authority.
  • Create repeatable processes for efficiency and profit.
  • Get down and dirty with the numbers. If you don’t understand them, speak with a professional who does. (Accountant, Mentor)
  • Don’t be a crappy person. People want to work with others that care.

I am always learning, as a business owner, as a Creative Professional, and as a human. I’d love to hear some feedback if you thought this was useful, and I’m always down to elaborate on some topics if you had more targeted questions.

If you hated it, feel free to drop me a line as well. I‘m open to criticism, and I want to share my knowledge with everyone else that stands to benefit from it.

If you’re lucky, you might just get some sass in return. 😉

Paul Melluzzo
Paul is a multi-disciplinary Creative Director with a background in Film, and Design. He has over 12 years of experience in the creative industry and has worked with both film productions and brands, such as Hallmark, Lifetime, NBCUniversal, Shiseido, and BareMinerals.

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