In this episode of the B2B Brand180 Podcast, Linda sits down with Nick Avaria, serial entrepreneur and founder of Agency Acquisitions, to unpack what it really takes for service firms to break through from mid-level profitability to seven-figure margins without burning out the founder.
The conversation explores how to maximize billable value, build lean teams, and design founder-led content systems that reliably generate pipeline, authority, and revenue—while putting the right operational leadership in place so the business can perform without the founder being involved in every decision.
02:00 How Service Firms Break Through to Seven-Figure Profit
03:10 Why Billable Rate and Productization Really Matter
04:20 Building Ultra-Lean Teams and Buying Back Founder Time
05:30 Outsourcing, AI, and Eliminating Low-Value Work
09:12 Content as a Revenue Engine and the Power of Personal Brand
09:50 Nick’s 10-20% Content Formula
12:11 Lead Magnets as the Primary Driver of Qualified Conversations
17:45 Rapid Fire Questions: Scaling, Content, and Profit Systems
https://www.linkedin.com/in/jennifervdalton/
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Millennium Agency: Brand Strategy | Marketing | Web Design: https://mill.agency
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https://www.amazon.com/CLAIM-YOUR-WHITE-SPACE-CRITICAL-ebook/dp/B0CLK8VLYV
Passion + Profits: Fueling Business And Brand Success
https://www.amazon.com/Passion-Profits-Fueling-Business-Success-ebook/dp/B0CLLDDSNX/
Linda Fanaras:
Welcome to the B2B Brand 180 Podcast built for leaders who want to scale smarter with transformative marketing strategies. Hi, I’m Linda Fanaras, CEO of Millennium Agency, and the host of the B2B Brand 180 Podcast. Today’s guest is Nick Avaria. He’s a serial entrepreneur and he’s the mind behind Agency Acquisitions and one of the rare operators who have built, bought and sold seven agencies while still running his own. You’ve really helped founders escape that burnout while they’re building that margin- rich business, they can actually scale without actually sacrificing their lives and live and die by work. So for today, our core audience will learn three kind of key things. They’ll learn the patterns that separate agencies stuck that might be at 300,000 or even those service firms from three to maybe 500K in profit to break into those larger numbers. And then actually how the content-driven systems can actually help drive pipeline authority and then, additionally, revenue. And then that backend, which you spoke about, that operational and leadership that’s required to build businesses that perform without a founder constantly being part of it, which I think a lot of founders have that. Nick, it’s great to have you here. I would love to have you share a little bit more insight about yourself.
Nick Avaria:
Firstly, thanks Linda for having me. Really appreciate your time and being on the show as well as the listeners, I hope that I can bring some value to you today. To give you some background on myself, I really got my start in say my career right after the financial crisis. So it was an interesting time to be around. I started off in, believe it or not, industrial services firms. So this is really big firms. We were doing well over $100 million, and I ended up doing mergers and acquisitions for them and just kept getting more and more responsibility. And then eventually I opened up my own consulting firm, my own marketing agency, and the rest is kind of history as you mentioned.
Linda Fanaras:
So let’s get into it. I’d love to ask you a couple questions. You’ve scaled service firms into some of the biggest seven, eight figure territories. What do you think the biggest bottleneck is keeping most service firms from $1 million in profit?
Nick Avaria:
I’m going to give you the corniest answer ever, which is it’s people, but how we get there matters. So the devil really is in the details here. I start off with the model really thinking through how do I maximize my billable rate? It’s no wonder why things like law firms or accounting firms generate high profits, right? And it’s like because their hourly rate’s really high and in the agency space, hourly rates are by comparison much, much lower. And it’s no wonder why. If you look at some polls, if you look at what the top 30, 40% of firms are doing, say in a law space, a lot of them are doing 25, 30, sometimes even higher percent profit versus say a marketing agency who averages 15 or less as the mean average. Now there’s ways, whether you’re an agency or a service firm, you have to look at really maximizing that billable rate per hour, and productization goes in here as well. So people are like, oh, but I’m not trying to do this. I’m trying to productize my offer. It’s like, look, productization is a tactic used to maximize your billable hourly rate, not the other way around. So the whole purpose of productization is maximization of billable hourly rate. It’s a tool. It’s not an end goal. It’s like I don’t want to productize and productize.
Number two, we need to tackle building our firms in a way where we have as few people as humanly possible. Having a lot of staff is actually the enemy of scaling profitably well. So the higher revenue per full-time employee that I can generate for the company the better. So we need to really think through that. The best way to do that is to think about our own as the founder, because arguably in a service firm, we are generally that person that knows the most. We need to be able to maximize our own billable hourly rate to the maximum. You can use prioritization, you can use just billing a high amount per hour, however you want to go about that. And you remember as a founder, generally no one else is ever going to actually surpass whatever your billable hourly rate is. So if you don’t increase it off the bat really, really high, that means that everybody’s going to be underneath you. So you better get to, in my opinion, somewhere between like $1000 and $2,000, an effective billable rate per hour. That’s maybe a controversial take, but if you founded a business, you’re probably pretty effective at what you do. You should be able to do much more work in much less time than everybody else. So that’s where I’m coming at it from.
Linda Fanaras:
That’s right. So if you were to look at this operationally, let’s say for example, we’re trying to reach that number. What does the firm look like operationally? Are they offshore employees? Are they in US employees? Is it a combination? And what does that look like? Structure, process, leadership rhythm, all of that?
Nick Avaria:
Yeah, I mean, I’ll speak quickly to the agency and say, as an agency, you need some sort of done with you or consulting-based offer to be able to capture higher dollar per hour rate. If you’re an accounting or law firm, you’ve already captured that higher dollar per hour. So I’ll skip there. Having said that, outsourcing in my opinion, is essential for low value tasks. And depending on legal and privacy things, obviously that might need to be somebody stateside, which is fine. But the most important thing is you need to buy back your time somehow as that high billing, high dollar per hour individual. And in my opinion, you just need to outsource everything that’s low cost. Like, don’t do $20 tasks, in my opinion. If you’re the founder, don’t even do $100 an hour tasks, don’t do them, right? If you can bill $500+ per hour, you should not be doing this stuff.
So get an executive assistant very early on in the process. Are they going to be full? No. And I think that this is a huge barrier to people. They don’t hire an executive assistant because when they add up the hours that this person’s going to do, they’re like, I don’t have 40 hours a week for this person to do. Trust me, there are things that you have put off that you’re not doing because you can’t imagine anyone having the time to do this. This person will have it. So they might start off like 30 to 50% full. Over time, they will get to 100% full. Outsourcing, I think for agencies is mandatory, especially in the environment that we’re in. I think that this is becoming more common as well in accounting and law firms to do these low value tasks. In the same vein as outsourcing, I do think that AI has come a long way and it can’t do end work output yet in my opinion.
However, it can automate small administrative tasks internally and using it intelligently in order for us to clarify our own ideation and making things just go faster. That is where it is today. So those two things, in my opinion, are a necessity. Don’t do $20, $50 or even $100 dollars tasks, just get rid of them. And this extends, in my opinion, beyond the workplace. A personal story that I can give is we have a young family, and after about six months of my wife giving birth, I had to finish work every single day and I was going upstairs and cooking, and it was taking me an hour, hour and a half with cleaning all this other stuff. This is madness. I own multiple businesses, I am doing this. I don’t expect her to do it with a six-month-old things are tough. But I was like, why am I doing a task that I can outsource for a fraction of my billable rate? So we actually hired a chef twice per week that would come every three days to come cook because the weekends weren’t a problem for me, right?
Linda Fanaras:
Right.
Nick Avaria:
So, they would come and basically cook that day’s meals and the next days, and that took me to at least Friday. So Friday it’s like, “Hey, it didn’t matter. I could do Friday, Saturday, Sunday, no problem.” So don’t just do this for your business life as an owner, founder, or executive, you’ve got to translate this into your personal life. Get a cleaner, get a chef part-time, get a house manager if you’re making enough money as well, reinvest that time into either A, getting proper rest, spending good family time and not resenting your business by freeing up this time. And number two, if there’s even more time, reinvest it into your business and make more money at your higher hourly rate.
Linda Fanaras:
So we talked about increasing your hourly rate. I mean you can productize, but it’s not really, it’s more of a tactical thing. It’s really just getting those numbers up and then operationally, it’s trying to maintain the small number of staff, not continuously adding staff. If you get a new client or whatever the case may be, just be extra careful with that piece. Now that we have that framework, we had spoken beforehand about how content architecture is like a revenue engine. So what is a formula that you’ve used that behind your content that has helped you scale your businesses?
Nick Avaria:
Look, the rest of it is all good, but to your point, you need the work. The work’s got to come from someplace, and in my opinion, content is the number one way to do this right now. Personal brand is in my opinion A, the lowest cost, B, most effective moat there is because the moat is you as a person, as the founder being out there. I’ll say my formula is actually really simple. There is somewhere between 10 to 20% about me, meaning things that I go through. I am quite active on LinkedIn. I generate a lot of leads through LinkedIn and Instagram, Meta, et cetera. And what I’ve found is that you’ll get a lot of engagement and things like that from this founder-led content that it’s like, “Hey, I talk about anything and everything in this 10 to 20%.” “Hey, I just sold a bunch of my real estate holdings,” or a talk that I had with my wealth manager or things that I do day to day that resonate with my target audience because they’re founders just like I am.
So if I just talk about what I’m doing as a founder on my personal side, generally that connects well, number one. But more than anything, it’s just value. I just want to inject as much value into my ideal target audience as I possibly can, and I make content that’s very specific. If you’re not an agency owner, I think a lot of what I’m talking about is valid for all B2B service. But if you go to my LinkedIn and you look at what I’m saying, some of it will cross over to other realms, but the maximum value is going to be drawn from an agency owner where they’re like, this guy’s in my brain. How does he know? I’ve had people go on calls with me that say, “Nick, it feels like you’re in the boardroom with me and my leadership team, and I look at your LinkedIn post and it’s like you wrote about it and I’ve never talked to you.” That’s how well you need to know your ideal client profile. If you don’t know your ideal client profile that well, you need to talk to them until you do and really kind of get those hopes, fears, what are they going through and all of that, right from the very beginning of your engagement with them.
Linda Fanaras:
Right. Okay. So you covered content, you spoke, basically what we’re saying is okay, you’re just talking about probably business tips and so on and so forth, but also about your day-to-day learnings could be anything, like you said, it could be your financial advisor giving some advice or how you’re using your time. But as far as companies are concerned, what decisions help them really unlock the next level? We already talked about time of value. We talked about operational efficiencies. Are there other things that you could share that you think could really help unlock that next value?
Nick Avaria:
Yeah, I would say as to round out the content point, one additional item that’s really required is lead magnets. And if you don’t know what a lead magnet is, a lead magnet is sort of like this free resource that you give away for absolutely nothing. It is people are going to have to pay with their email address because you need to send them the thing that’s all you really require from them. But if that thing that you give away is valuable enough, people will understand that and be like, this person or this brand is smart, I need to talk to them. And they will book themselves. And this is where we generate the majority of our leads across all social media platforms with this personal brand strategy is after we send them the lead magnet, we just follow up and say like, “Hey, do you think that this thing could be improved? Did you like what you read? Are you facing some challenges that this thing resolved? Are there any challenges outside of this because we might have a different lead magnet that we can give you.” And inevitably people just start talking because people that have a problem want to talk to somebody that understands their problem, and it’s because the brand has established that that is what we do. You’re an easy person to talk to. Inevitably they’re going to book a meeting with you if you steer the conversation that way, if it’s needed and if you believe you can help them. I guess to your point around margins and things like that, what is the shortest path to this $1 million in profit idea? I’ve recently started this consulting firm, Agency Acquisitions, which is A, a consulting firm, B, we’re doing agency acquisitions as well ourselves for my own agencies, which I own a couple of.
And so it has more than one purpose, but this business has basically followed the exact tenants of what we’ve talked about today and Agency Acquisitions at this time. It’s a business that’s probably maybe like 19 to 20 months old at this time. It profited $1 million in annual profit line about six months ago. We’re already kind of there. And to be frank, breaking this down, it’s me, it’s my assistant, it’s one salesperson, and that’s it. It’s super lean. And is my assistant typical? No, they get paid almost double going market rate, right? Is my salesperson typical? No, their commissions and their base is much greater than the average. So these are not typical results from typical people. And to create high margin, we need people that are non-typical. So this anchors back to the very beginning where I said the corny answer is people, but I didn’t say what kind of people. The kind of people matter. And the reason why we need high billable per hour is because high billable per hour means high revenue per full-time employee, high revenue, full-time employee governs how much we can pay people. And if you want the top people, you got to pay them top dollar because if you don’t, they’re not going to stay with you. So all of these things that we’ve discussed today, like buying back your time, maximizing hourly, the source of leads, all of this kind of leads to, and even the content that helps attract the best people.
The number of people that come to us and say, “Hey, can we partner with you? I saw you. Looks like your audience is very active.” These things afford us opportunities with a very small staff. And the last thing I’m going to do is hire people. And if I am going to hire people, I’m probably going to hire somebody that came to me through the content funnel that is a top performer, and then we’re going to do some test projects together and we’re going to vet them so that they can be, I know they’re a high capacity person.
Linda Fanaras:
Right? Yeah, that’s great. That’s great. I think founders honestly do have a hard time making that shift to where you’re talking about, which is a complete mental shift. So what do you think? Just jump in two feet first?
Nick Avaria:
I think that the main mental blockage that I had that other people may resonate with is that I was trying to make everything too scalable, too fast. And I learned this a couple of businesses in where I was like, I can’t be involved in any of the delivery. I can’t be part of the day-to-day. I need to remove myself as fast as possible. That is the correct thing to do. It’s just the order is wrong. It’s maybe the third or fourth thing that you do, like once you’ve already maximized revenue per employee, once you’ve already bought back your time and outsourced as many things as possible. Once you’ve generated a consistent lead source, then you can start hiring leaders and putting them into place and then removing yourself. But guess what? Until those three things are done, you have to be involved very intimately in the business. So this is why I say the path is generate that annual $1 million in profit as soon as possible. Do the work if you need to in order to get there. Now you can afford top talent that will actually take work off of you because this is what happens otherwise: you hire a person that’s a manager that fits the title box of what you’re trying to do, and then you’d have to do a quarter of the work for them. Why? Because you don’t trust them. They don’t do the work to your standard, et cetera. It’s like, well, aren’t they doing the work to your standard? It’s like, well, because A, you’re not clear enough because not doing enough of it yourself to be able to make it clear. Number two, you’re probably not paying people enough, but if you have a million dollars in profit with a three-man team, guess what? When you hire somebody, you can spend top dollar on acquiring that person, and that person’s expectation is to be autonomous within three months.
Linda Fanaras:
Right? Yeah. That’s great. So I’d love to ask you what I’ll call rapid fire questions. So what’s the biggest misconception about scaling a service firm?
Nick Avaria:
That scaling is about the number of people you have rather than the revenue you have per person.
Linda Fanaras:
Perfect. What’s one content channel every service firm should own?
Nick Avaria:
LinkedIn and Meta right now.
Linda Fanaras:
Okay. What’s the fastest way founders burn themselves out?
Nick Avaria:
Not getting reward for their work.
Linda Fanaras:
And what’s one system every agency should build before trying to scale?
Nick Avaria:
Dashboards.
Linda Fanaras:
What’s the single best move a founder can make today to increase profit?
Nick Avaria:
Build out your dashboards internally because that is what helps you find where you’re leaking profit.
Linda Fanaras:
Great. That’s perfect. Thank you, Nick. So Nick, these insights were awesome. I think you kind of cut through all the noise, but before we wrap, I would love listeners to connect directly with you. Could you share how they can get in touch with you?
Nick Avaria:
Yeah, you can find me on LinkedIn @Nick Avaria, also agencyacquisitions.io. And if it’s okay, I’ll leave a free piece of value for your listeners. I have a training on how to delegate and how to manage teams really well. So when you do come to the point where you need to free yourself up from the day to day, it’s an easy guide to go through for free.
Linda Fanaras:
That’s great. Yeah, you can go share that with the audience. Awesome. So thank you for listening in today. If you enjoyed this episode, we’d like you to like, share or subscribe, and for leaders ready to build a brand with real market pull, visit mill.agency or lindafanaras.com.
