Ralph and Lauren sit down with Chris Martinez—founder of Bloom Partners and architect behind Agency Freedom Live—to expose what’s really wrong with the digital marketing agency space. With over a decade of experience, Chris shares hard-earned lessons on how bloated promises, shallow metrics, and lack of accountability are destroying agency reputations. If you’re tired of BS and ready to scale your agency the right way—with real metrics and leadership that delivers—this episode is your roadmap. Discover how to stand out in a sea of scammers, earn client trust, and transform chaos into clarity.

Chapters:

• 00:00:00 – Kicking Off with Ralph & Lauren: You’re Not Gonna Want to Miss This One
• 00:01:17 – Meet Chris Martinez: The Agency Leader Disrupting the Status Quo
• 00:01:51 – Why Most Agencies Are Broken (And What Needs to Change Now)
• 00:06:12 – The Numbers That Actually Matter If You Want to Scale Profitably
• 00:11:58 – How to Stop Wearing Every Hat and Build a Real Team
• 00:13:46 – Losing Clients? Here’s What That Really Says About Your Agency
• 00:17:57 – When Emotions Hijack Business: How to Lead with Data and Discipline
• 00:18:48 – The Brutal Truth About Underperformers on Your Team
• 00:20:24 – Don’t Skip This: The Power of Job Clarity and Measurable KPIs
• 00:21:12 – Want Accountability? It Starts at the Top (Yes, That Means You)
• 00:24:02 – Your Clients Aren’t Off the Hook: How to Hold Them Accountable Too
• 00:26:39 – How to Audit Your Business and Set Profit-Driven Goals
• 00:30:27 – Limited-Time Offer: How to Get Exclusive Access to Agency Freedom Live
• 00:33:42 – Final Mic Drop: What It Really Takes to Build a Scalable, Respected Agency

LINKS AND RESOURCES:

• Agency Freedom Live
• CALLING ALL 7-Figure MARKETING AGENCY OWNERS…
• BLOOM
• Get Your nCAC Calculator Now!
• Tier 11 Jobs
• Perpetual Traffic on YouTube
• Tiereleven.com
• Mongoose Media
• Perpetual Traffic Survey
• Perpetual Traffic Website
• Follow Perpetual Traffic on Twitter
• Connect with Lauren on Instagram and Connect with Ralph on LinkedIn

Thanks so much for joining us this week. Want to subscribe to Perpetual Traffic? Have some feedback you’d like to share? Connect with us on iTunes and leave us a review!

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READ THE TRANSCRIPT:

Selling Your Agency for $10M+: The Untold Obstacles Revealed with Chris Martinez

Ralph: [00:00:00] Hello and welcome to the Perpetual Traffic Podcast. This is your host, Ralph Burns, and the founder and CEO of Cheer 11 alongside my amazing Seattle based

Lauren: Lauren Eve Trau, the founder of Mongoose Media,

Ralph: that’s right. Well, and today is an amazing podcast because we’ve got an

Ralph: amazing guest. amazingly amazing handpicked, hand

Ralph: plucked for his expertise in the agency space. And I know you’re listening, you agency owners. ’cause today we’re gonna teach you the right way to grow your agency with a guy that is doing it the right way.

Ralph: ’cause I used to try to do it and then I kind of sucked at it. Although all the people that actually went through my agency program did actually have a good time. I dunno if they learned anything, but you know, they had a good time. In your case, you’re actually teaching them the right way to do it.

Ralph: [00:01:00] Through the real metrics that matter for an agency, but also you’ve got sort of a bone to pick with the agency space in general, which is something that you and I and I think Lauren also really resonate with. And we’re really, really glad to have you on today’s show and Perpetual Traffic. Welcome Chris Martinez from Bloom Partners Agency Freedom Sponsor of Agency Freedom Live coming up in June. So welcome to PT Man.

Chris: Thanks guys. Great.,

Ralph: So Chris, what’s the bone that you have to pick? with agencies So what is it about

Ralph: agencies that are doing it the wrong way?

Ralph: And this is, this is the reason why we’re connecting on this and why I’m actually consulting with Bloom Partners on what you’re doing. ’cause I, we both feel very, very strongly on it. So.

Chris: I started my agency in 2012 and it was a much different landscape back then. I mean, looking back, who knows if it was realistically better or worse, [00:02:00] but. Objectively speaking. Right now, our industry as a whole, the reputation has never been worse. And if you walk into a room and you tell somebody, Hey, I am a digital marketer, or I own a digital marketing agency, what’s the thing?

Chris: They’re gonna think Scam. Yeah, right. Scammer. sucks. the reality is that the, I would say the overwhelming majority of marketing agency owners are good human beings. They want to help clients. It’s a small percentage of people that have really fucked over our industry selling things to people when they didn’t know how to deliver and they didn’t know how to get results.

Chris: And ultimately they didn’t know how to help their clients make more money. That’s really what a marketing agency is supposed to do. It’s like, you know, we gotta help our clients to make more money. It doesn’t have to be more complicated than that. And so, you know, that’s kind of the bone that I have to pick, so to speak.

Chris: Ralph is like, I’m tired of seeing this. Like, we gotta stand up and take a stand and.

Ralph: Yeah. we say that this stat all the time, We paid for this

Ralph: report so we know it’s, you know, somewhat [00:03:00] accurate, even if it’s halfway accurate. Like there’s 433,000 agencies on the planet. Like, let’s say there’s half, there’s 200,000. That’s still, that is an incredibly fragmented industry, and the reason is, is there’s no barrier to entry.

Ralph: and it’s unregulated, there’s no rules.

Ralph: So if you have a laptop and you have some kind of knowledge of, let’s say Google ads, or a content marketing, or a website building or meta ads, you can start an agency. And you can also do it really, really cheaply and undercut everybody else that’s in the space.

Ralph: Question is, is how good of a job are you really gonna do? And when we talk about how good of a job, that’s also a subjective measure. So, quick example, I was on a discovery call today with a customer in the, they basically, you know, trick out trucks and like they’re in that space. , Great business he’s like, yeah, my agency right now is doing about as [00:04:00] good as I was doing when I was running it.

Ralph: They’re getting about a three to four to five meh blended roas. Like he understood kind of how it all worked. It’s all in app metrics, and he is like, I’m not making any more money. I’ve been flat ever since I added these guys for a year, and they’re telling me every week, Hey, look at, look at your roas, look at how great we’re doing on meta Google, you name it.

Ralph: And I’m like, this is a story I’ve heard hundreds of times is that you can make the metrics look as good as you need them to be in order to air quote, not get fired. But at the end of the day, if the business owner is looking at your production as more than just in-app metrics or you know, reports that you’re showing them, Hey, look at our frequency, our reach this week, or our impressions, like that’s even worse quite honestly, but.

Ralph: It can be manipulated. , I don’t think agency owners necessarily believe they’re trying to deceive. They just [00:05:00] don’t know any better in some cases. But in some cases they do and they do it in spite of that. And that’s sort of the duality of it, is that I was like, listen, what you wanna grow 31% over the next eight years and get to $50 million in revenue?

Ralph: Like you’re at X number of dollars right now. That’s what you wanna do, right? He’s like, yes. Like my goal is to get you there and to get there in incremental steps. 31% this year, 31% next year at an end cer cost to acquire a customer. That makes sense. And then we increase LTV, we increase a OV. We do all these things.

Ralph: Three ways to grow the business, right? Get more customers, get ’em to buy more often, get ’em to buy more when they buy. There’s the only three ways he’s like, yes, that’s it. In-app metrics don’t show that. So his agency isn’t bad, I don’t think they’re evil people, but they’re just, they don’t get it or they don’t wanna get it.

Ralph: And he’s looking for alternatives. And I think that’s kind of what’s wrong with the space. I would even say in that case, that [00:06:00] individual is probably dealing with a, like an, a good agency. Like they’re doing a, good job, but he’s not getting what he wants out of it. ’cause his business is flat year over year ever since he hired him.

Chris: well, part of the problem too, Ralph, I agree with everything that you said. one of the root causes of that issue is that a lot of agency owners don’t know about business. They don’t understand the metrics of running a business. So to be able to have a very intelligent marketing and sales conversation with client or a prospective client, you do have to understand concepts like cost of goods sold and operating expenses, and just overall profitability and how you scale a business.

Chris: , And, you know, I think because as you mentioned, the barrier to entry is so low and the type of people that typically gravitate towards running a marketing agency, not a whole lot of business backgrounds. And We all worked in corporate. We all see reporting that goes that, like, that you have to do and all the things that are tracked in corporate America.

Chris: And so we do have an understanding of how things are supposed to run. A lot of marketing agencies [00:07:00] who don’t have that background, they just kind of shoot from the hip, you know, and, bring those types of, they’re not best practices, maybe like mistakes or like lack of SOP or whatever, like their lack of business knowledge carries through in the way that they, deliver for their clients.

Chris: that’s one of the issues with that, that that’s why we’re dealing with these

Lauren: They’re in these creative ideas, but they don’t know about the business impact. But also, not only do they know about it, they don’t know to ask for it. So I’m sure that they’ve not been given credentials or information that speaks to profitability because they’re like, oh, well, I’m dependent on in-app row as something I can demonstrate at large at scale.

Lauren: However, the net growth on that business, they don’t know to ask for. I think that’s the biggest part. Like when you don’t know and you don’t know what you don’t know, you’re in a perpetual state of mediocrity.

Chris: And I’m not like some finance expert, you know, I didn’t go to Wharton or Harvard, you know, or I, graduated with a degree in [00:08:00] sociology. , But I’ve learned over the years and I’ve learned how to run a business and I love business in general. I love running businesses.

Chris: Obviously we work with clients and we show how to run the business better.

Ralph: Yeah. Well you bring

Ralph: up an interesting point because how can a agency owner understand a client’s business if they don’t understand their own business? And I think that’s one of the cool things about when you work with somebody, that’s the first thing that you do. And we’re obviously gonna have an incentive for people to get involved with you at the end here.

Ralph: So, you know, open loop. But the point is, is I think that’s what’s wrong. With a lot of agencies is that they don’t have the metrics or they don’t even understand their own metrics. How can they understand like the cost of goods sold or gross profitability or you know, operating expenses or chargebacks or any of the things that you need to understand in order to determine N CAC at the end of the day, or how to grow a client’s business if they don’t understand it themselves.

Ralph: And I’m sure one of the questions that you probably ask [00:09:00] is, obviously you look at their p and l or their profit and loss statements, but then you ask the question for them, like, how much can you afford to pay to acquire a customer? And I know the answer in the agency space is, eh, no, no, 300 bucks,

Chris: So one of the things that we do at the very beginning of a client relationship is we get their numbers right. And so we map out a budget. So they say, I’m doing, you know, 1.5 million, , in revenue and this is my profitability and I wanna get to here in 12 months time. And so we’ll map out exactly when it needs to happen.

Chris: And, , we always create sales targets. They, I would say 99% of agencies do not have quotas or sales targets every single month. And so we have to create that. Okay, cool. So you want grow by three clients a month.

Chris: The point that I’m making is that once we establish a quota, even if it’s one client a month or three clients a month, then the next question we ask is, how much are you willing to invest to acquire a client?

Chris: Do you know how many [00:10:00] people have actually thought about that? Like maybe one out of 50.

Chris: you know, and to me these are like basic marketing questions that we should all be asking our clients too. If you’re willing to invest, let’s just say a thousand bucks for a client and you close at 20%, then you say, okay, well how much am I looking to invest? I know it should be higher. How much am I willing to invest to get an appointment?

Chris: So if it’s, if coin that 20%, then you should be willing to invest

Chris: $200,

Chris: you know, to get that appointment. So very, very basic things. It’s all math.

Chris: I

Chris: know it scares some people and

Chris: It’s

Chris: not necessarily fun. it’s 99 cents store calculator math. You know, we can all do this now. We do have a data analyst that’ll go through and like, put in all these crazy calculations. Like if you have a sales team and you need to calculate commission rates and you know, what their quota should be and product mix and what you should sell of each one and A RPU and all this other stuff.

Chris: Like, you know,

Chris: like we can do

Chris: we, our p you’ve never heard that term Average revenue per unit.

Lauren: Oh, no,

Chris: Yeah, [00:11:00] that’s a, that’s a good one For Jeopardy.

Lauren: that sounds like, a character of the next Disney film.

Ralph: banking school, the movie, the new movie by Disney. , So. tell the agency listener who’s like, all right, all this makes sense. I’m sick of burns, like ranting about agencies yet again. , Martinez’s hair sounds like he kind of knows what he is talking about. But Like how do you do it? Like how do you figure out what that number is and then back it out and out and then say, oh, okay, if you want to grow by X amount, this is what you need more of.

Ralph: And then you determine what actions they need to take. Like Take us through that whole sort of process there.

Chris: I’m gonna explain it in a way so that really anybody can do this. , It’s just something that we happen to do all the time. So obviously it’s way easier. And if you wanna try and do it yourself, send me a message. I’ll, I’ll walk you through it if you want. So there’s two aspects of figuring out how to get from point A to point B.

Chris: The first one where we like to [00:12:00] start is the team. So who do you have on the team now? What are they doing? And then what do we need them to do? So if I’m gonna use a sports analogy, right?

Chris: So let’s say there’s 11 players on the field, right? The goalkeeper obviously has to keep the ball from going in the net, right? If your goalkeeper is not able to do that, can we train that goalkeeper or do we need to trade them and bring in somebody who can? Your forwards have gotta score goals.

Chris: Your midfield gotta be playmakers, right? So everybody has a specific function on the field and in, in soccer for all the soccer players that are listening. You might change up your lineup based on the team that you’re playing and if you’re home and away. So maybe they’ve got, you know, just massive bodies in the back and there’s no chance of you winning head balls.

Chris: And then, so then you’ll put Lauren, you petrillo up at top and just have her receive those balls and then play the midfielders through. So

Chris: whatever the, tasks are, you align those with the people on the team. I know we can, we’re just gonna turn this into a soccer

Lauren: I played soccer in college. Look, I thought I

Lauren: [00:13:00] was going to be a professional soccer player. Okay? That was my entire life until I.

Chris: I am shocked that you were a midfielder, by the way. I

Chris: Anyways, where were we talking about? you need the right team in your agency. If they can’t do what you need them to do, we gotta level them up and train them to do that. Otherwise, we are going to have

Chris: to

Chris: find

Chris: somebody else.

Chris: And that’s the way that it’s

Chris: Sure. Mm-hmm.

Ralph: versus attrition? Like how do you know? Because that’s an easy, like I get it, there’s 11 players on the field. We’re using the soccer analogy here, but like get a little deeper on that because that’s where people are like, well I’ve got seven media buyers and I’ve got two creative people and I’ve got a strategist and then I’ve got, you know, a deaf person.

Chris: It’s a great question. Okay, so this feeds perfectly into my second one, which is the numbers. So the second thing that we gotta do is we gotta dive into the numbers and we gotta see what’s actually going on

Chris: into the

Chris: business. And

Chris: we gotta look at the numbers. We gotta see what’s actually going on. So my big phrase is facts, not feelings. Right? And there’s no more [00:14:00] factual thing in your agency or your business than the actual finances of the business.

Chris: So we gotta look at the numbers. One of the first things I look at is the cost of goods sold. So specifically to your question, Ralph, are we staying within the budget?

Chris: So what I like to see, and there’s some variance here, but what I like to see is whatever your revenue is, I like to see 30 to 35% of that going towards cost of goods sold. Meaning mainly the fulfillment team that’s producing the deliverables and any other software that we’re using. For fulfillment. So all your fulfillment stuff.

Chris: I like to see that around 30 to 35% of the revenue. the reason I start there is because if we’re losing money on cost of goods sold and our gross margin isn’t healthy, it makes everything else more difficult. So we go in there. So if you have seven media buyers, right, and I’m looking at your revenue and I’m looking at your cost of goods, and, this is like really happens, like some people’s cost of goods is like 70% or 80%

Ralph: It

Ralph: is

Ralph: [00:15:00] related to revenue. You have media buyers in this case relate to like how much revenue comes in, how much, how busy they are. That is a cost that rises and falls with sales in essence, although a lot of people would debate that because it’s personnel. But anyway, I, I

Ralph: agree. ‘

Chris: exactly.

Lauren: Well, there’s like with labor, because labor is, if they’re doing marketing for internal purposes, so our media buyers are doing hours on mongoose media ads, whether it’s on like PornHub or Facebook.

Lauren: That doesn’t count in

Lauren: the cost of

Lauren: fulfillment

Lauren: because Mongoose Media is an internal client, external watch,

Chris: so when Lauren is advertising for herself on PornHub, that is more considered an operating expense. But if PornHub is a client and they’re fulfilling for that client,

Chris: now it becomes cost of goods sold.

Chris: See how I tied that all together there? if that number, if that percentage of revenue is higher than, you know, 35%, more or less, then I look and see like, you know, what’s the issue here?

Chris: I’ll then [00:16:00] actually switch and I’ll go look at churn, because churn is a great indicator if our, if we’re actually getting results for the clients. What we sell, as I mentioned, is inherently easy, right? Where clients are giving us a few grand a month and we’re turning that around and we’re generating a lot more money for them.

Chris: That’s really what we’re here for. And if we’re not doing that, then a lot of the times they’re gonna cancel. It’s not the only thing. We do have to manage the relationship and build trust and all those things, right? But if we’re not making money for our clients, they’re going to cancel. So then if I look at those two things, I see budget and I see high churn, right over budget and high churn, then it goes back to the people conversation.

Chris: It’s like, okay, yes, you have those set seven media buyers who are the ones that are actually making money for the clients. And the ones that are not. ’cause it’s usually just a couple bad apples that are ruining it for everybody. We have to make the decision red, yellow, green, they’re green, then they’re great.

Chris: And we keep ’em, they’re yellow. It’s somebody that maybe we can [00:17:00] train, or if it’s red, like, this person’s been a problem for a long time, let’s just, you know, cut our losses and move on.

Chris: Well, it’s not easy to do that. But again, we’re making those decisions with facts and not feelings because it’s like, if this person’s been making that mistake for the past three years

Lauren: gosh. Yeah.

Chris: and they’re still on the team now, that’s an US problem.

Chris: That’s an ownership problem. this person’s not gonna improve. And maybe they were great when the agency was smaller and we were doing, you know, a half a million and whatever. But now we’re playing a different game. You know, we’re in the big leagues here. We need better quality people that can perform for our clients, otherwise we suffer.

Ralph: that’s a good place to, just reiterate that point, is

Ralph: that I find that. In almost every round table or any group discussion that I ever do with agency owners, it’s always like, oh, I need to let this person go, but I just can’t because then I have to go out and hire. so they just let them fester longer and longer and longer.

Ralph: And I think your percentages of like, I’ve got seven [00:18:00] and maybe two of ’em are great. And then the others are sort of in the either yellow or red. The reds like the hardest part is letting go of the reds. I think just, I mean it’s apparently not a problem for me ’cause I hired more people than I probably hired.

Ralph: No, that’s not actually actually true. But the point is there’s an art and a science to it. You have to understand that. You have to separate out the feelings. Although I will say, you say facts, not feelings a lot. I think all business is personal and so there are feelings and it’s to separate them to be cold.

Ralph: And my wife tells me this all the time. She’s like, you’re so cold. When it comes to these sorts of decisions, it’s not, I just have to like separate it out because. I come across that way because it is personal. You develop relationships with these people and that’s the hardest thing to do. And making that decision, I always sort of look at, and if you’re an agency owner, you have seven people on your staff right now, right?

Ralph: In the analogy that we’re talking about here, maybe you got 11 person, crew, whatever it is, ask [00:19:00] yourself the question, if I let this person go today, would I be happy or sad or ecstatic and relieved? Or they, if they quit today,

Ralph: would I like, do everything I possibly could to save them?

Ralph: And that’s a great differentiator.

Ralph: And if it’s you are relieved or you’re slightly happy, like you need to take action. So, what do you do there, I guess? Like what’s your, well the facts, not feelings. Like how do you coach your individual? ’cause I see that as like one of the biggest, biggest issues because it’s really is hard to separate that out.

Chris: So when I say facts, not feelings, I’m not saying to just be a robot and ignore your feelings. What I am saying though is don’t let your feelings dictate all of your decisions, your feelings, your gut can absolutely make you aware of problems. That’s how we’ve survived as a species, is we do have an instinct, but at the same time, if your instinct [00:20:00] is essentially to help you survive that instinct, can also keep you from making a decision that you have to make as an agency owner that gets outside of your comfort zone.

Chris: You might be playing it safe, you might be hanging onto somebody that’s not a good fit, right? So that’s why I’m saying you need to make, ultimately make the decision with facts and not feelings. So when I go through and if we’re gonna determine whether or not we have to let a team member go. We’ll go through their job description.

Chris: Another thing that most agency owners don’t have, we’ll go through a job description that lists out exactly the things that that person needs to do to be successful at their job. We put our job descriptions

Chris: as daily,

Chris: weekly, monthly, quarterly,

Chris: semi-annual goals. So we just go through a checklist. Are they doing this?

Ralph: Yeah.

Ralph: Whether you’re a business and you’re listening to this, you’re like, oh, should I hire an

Ralph: agency or I am an agency Listening to this?

Ralph: having that is actually absolutely critical.

Chris: Yeah.

Chris: I got that from my wife actually. She’s like amazing at the whole HR stuff. So, [00:21:00] we’ll go through that and now we’re starting to look okay. They can’t do the job. How long have they been training? Like, have we been trying to fix this for weeks, months, sometimes years. Then it goes to, well, what’s the alternative?

Chris: Will we keep them on? and you look at the growth trajectory that we have in our budget and you know, all the things that we’re looking to accomplish as an owner, you have to also recognize that if you’re keeping somebody on the team that is not a great player, your great players are looking at that and they are considering leaving because of that reason, and they’re looking at you and they’re wondering what the hell is wrong with you?

Chris: And maybe they’re questioning your ability to lead

Ralph: People forget that so much. And like if you’re, really, really, uncomfortable with this, you have to start thinking, are you the right fit for the role that you’re in right now? And even like, I’ve had this conversation with just some of my managers, like, if they absolutely hate this stuff and like, we have to reevaluate whether or not you’re in the right role within the organization.

Ralph: If we have another seat on the bus that [00:22:00] perfectly fits your, talents and your skills, great. If not, we might wanna move on. And we have done that. And that’s really hard because these kinds of decisions. Are not made lightly. And you know, to be able to do them takes a lot of courage and you should never feel like you enjoy it.

Ralph: That’s masochistic. But you should feel badly. Yes. But if you are just riddled, riddled with guilt, even when somebody is a bad hire and you know they’re a bad hire, when you do, finally let them go, everyone who’s good, finally a letter. What took them so long? They all know.

Lauren: Those are the worst conversations because then it’s like, well, we were ready to quit, and it’s like, at least I can speak from my standpoint, I’m like, well, why did no one tell me? I was under the impression that

Lauren: this was all happy go lucky.

Lauren: I didn’t realize that

Lauren: this had become pervasive.

Chris: yeah, you would think that they would speak up. They’re terrified. and in reality, that’s not their job really. Like, you know, like, you are there. This is the part of being an owner that I think is the least [00:23:00] sexy and definitely the least fun is basically holding people accountable, right?

Chris: Like, who really likes going around and holding everybody accountable From a sports perspective though, think about the best coaches that you ever had in your life. Those are the folks that made you stay late, that made you run when you didn’t want to, that

Chris: pushed you

Lauren: you

Lauren: out on your shit

Chris: called you out.

Chris: Yeah. Go hard in that tackle. What’s wrong with you? you’re going up half-assed for those head balls. I know you can do that. Right? Those are the people who get the best out of you. The soft coaches, we don’t even think about them anymore.

Lauren: Oh my gosh, I remember I was like, I can walk all over this coach. Like they don’t actually

Lauren: care, so why should I care?

Chris: exactly. So that’s part of your job as the boss, as the owner is you have to go around holding people accountable.

Chris: And we have systems to be able to do that so that it’s fair and ethical and obviously, makes it a lot easier to make these hard decisions. But that’s what you signed up for as an owner. And if you want to build a business that you could sell one day, that’s an asset that you can sell one day. I promise [00:24:00] you, you have to have these systems in place.

Lauren: one level of accountability though, there has to be a moment where you have to evaluate, did you hire the wrong client? Because there are times where you could have really great A players, and I’m just gonna use immediate buyer example, and it’s like they have a bad offer. They’ve done everything. They’re not updating, they’re tracking, or they will not pivot their offer to match what the market demands.

Lauren: And so then you’re doing everything you can. And I have seen talent media buyers wither away because everything that they’re trying isn’t working and there’s no cooperation back. So that like putting that aside, the accountability has to go both ways.

Chris: I agree 100%. And there’s, this is the way you have an SOP for what’s a good client, and that needs to go all the way,

Chris: through to the sales team. These are the boxes that they check to make sure that they’re a good client for us, that we can bring them on. here’s something that I’ve never seen anybody else do when you’re onboarding a client.

Chris: A new client, you walk [00:25:00] through all the things that they have to do. Right. It’s kind of like a checklist of like, Hey, if you need to do this as our client.

Lauren: Like the agency for agreement.

Chris: So you go through and you go through these four agreements or whatever and, and, then you send it to them to sign. We do this for our clients. You send them a document, we call it a best practices document, and you have them sign it. Is it legally enforceable?

Chris: No. But there is now a mutual agreement amongst people that, Hey, yes, I understand that I need to do these things and if I don’t do these things that I might get dropped as a client,

Lauren: Like earlier communicating financials of if the cost of goods increases or if financially speaking you need to communicate. When, like right now with everything with the tariffs, costs are going so high for many of the products that we’re selling that if we don’t get that carry over and we’re not communicated the moving targets like how we can have impact our marketing efforts, then

Lauren: they’re not following through

Lauren: with the agreement we’re to an accountable standard that we’ve not [00:26:00] been communicated to.

Chris: That’s a great one that you could put in there and who could have predicted the tariffs. But if you had something in there that says, you know, like, Hey, if costs are adjusting and we might need to adjust our cost, target cost of acquisition, or whatever, you know, so that also is part of the reason why you need to be really good at understanding business

Chris: So that you can then educate your clients,

Chris: because a lot of the times they’re not even thinking about that either.

Ralph: What’s the next step? After you figure out who your people are,

Ralph: you have those tough conversations. figure out who’s on the team like what’s the

Ralph: next step in the journey for you all? take people through this.

Chris: Yeah. So ultimately after we have our team that we need, , now also in the future, that’s gonna help us get to our goals. We have this whole budget that lists out their financial targets, their sales goals, their cost of good goals, their net profit goals, everything. We map all of that out. , And then we hand them the tools and we, or we hand them the plan and we say, Hey, here you go.

Chris: You like, go ahead and execute on that on your own. Or, you know, that’s where we could come in and do a longer [00:27:00] term, , engagement. And, don’t think, well, our clients say that they love the clarity, what they also enjoy. Is having us there to drag their asses across the

Chris: finish

Chris: line. ,

Chris: So one of the things that our clients love about us is ultimately having us there in their business every single week, every single day if they need is, , just dragging them across the finish line. And so, , we implement our facts, not feelings method of course, which means that you’re gonna have a whole lot of reporting that you’ve probably never done before or have looked at.

Chris: you’re gonna have to send us the financials every single month. ’cause that’s how we make sure that we’re actually on track and making money. and it’s just a way of running the company. There is a level of transformation that the owner has to go through as well. But our clients that work with us are ready for that because they, as I mentioned before, these people want to build an asset that they can sell one day.

Chris: It’s a big, big component of who we work with is they’ve, been doing this for a while and they’re like, you know what? I know that I’m not gonna do this forever, but I see where [00:28:00] I’m at today and I know that I’m onto something.

Ralph: So the analysis is,

Ralph: really is, we’re sort of talking about to start this whole conversation like how much you can afford to pay to acquire a customer. If you’re an agency and most don’t really know, it’s, you know, one of these, but we’re talking about like figure out your profitability and then as a result of that, there’s probably some internal, well, churn might be an issue of bad client but also bad employee.

Ralph: That’s a whole other conversation. Clearing out your, red, yellow greens as far as like your best employees go, the ones that are actually carrying the team and the ones that are dragging everybody down. Got it. Then you’re actually closer because you now know what the big number is, what your COGS number is, basically what your gross profitability is.

Ralph: ’cause gross profitability is revenue minus cogs, and then you got your GP. And then from there you determine what, like the growth that most [00:29:00] agencies want. The ones that I talk to are like, yeah, just get me more leads, man. And then they don’t know how much to pay to acquire a lead. And then that would be sort of the step, like that’s the step before the step.

Ralph: That was actually the cost to acquire a sale.

Chris: I’ll do a little analogy of , the business analysis that we do. it’s, like doing a full diagnostic test of your body, for example. So we’re doing blood work, we’re doing, you know, CT scans. We’re going through everything that’s going on in the business, and that will give us an understanding of why we’re at where we’re at today.

Chris: Second piece of this, and this is really like, I think it’s the value is, is what needs to change for us to get to this. Goal that I have. So if that goal is 5 million revenue, if that goal is a $10 million exit or a $20 million exit, we map that out for you over the next three years. this is where you’re at today, which is very, very important.

Chris: That’s our benchmark. These are the things that we have to fix. Maybe it’s a churn thing, maybe it’s a cost of goods thing. Maybe it’s a people thing. Maybe it’s a profitability thing where you’re just, you’re not [00:30:00] building your business for profit. and to be able to do that, maybe we’ve gotta raise prices.

Chris: Maybe we gotta let people go. Maybe we have to bring on better people. Maybe we have to invest in our own marketing. It’s different for everybody. But that’s ultimately what we do in that business analysis. And so when you leave, you know exactly what needs

Chris: to change

Chris: for you to be able to hit that target Well this whole, we call it our profitable agency business analysis. That’s our fancy term that we have here at Bloom. , We charge normally $2,500 for that. , For the first five people who are listening right now, if you are over a million dollars in revenue, have to be over a million dollars in revenue.

Chris: And I’m not like, don’t put ad spend in there because I will catch you. You’re over a million dollars in revenue. , You can get this Profitable Agency Business analysis, which we normally charge for $2,500. You can get it for free five people. So you gotta go to the page and act fast. Just go to agency exit plan.com and we’ll do this whole thing, the [00:31:00] whole analysis, everything for you.

Chris: We’ll meet one-on-one on a live call.

Chris: It’s two

Chris: hours.

Chris: we’ll give it to you for free. So go to agency exit plan com.

Ralph: Agency exit plan.com. And oh, by the way, we didn’t mention like you’ve exited your agency, like you actually know what you’re talking about. This sort

Ralph: of

Ralph: stuff, like how to prep for sale.

Chris: that’s the bigger piece of what we’re doing as well. So we’re actually helping an agency to, , do an exit right now, husband and wife team. Amazing, amazing people who’ve built a great business. And so, we are

Chris: deep

Chris: in it and things are going very, very well. So I, I know what I’m talking.

Ralph: To the outside world, to the private equity world, to the, you know, larger strategic, whether you wanna be a tuck in whatever it is that you wanna do. But if you wanna sell your business and you’re an agency on it, you have to have a system.

Ralph: And yet it’s like these guys will eviscerate you the private equities of the world, unless you have numbers that match churn. Obviously we talked about employee churn to a certain [00:32:00] degree,

Ralph: but employees relating back to curing, churn, number one issue, like we went down this road three years ago, that was the thing that they’ve dialed in on us so much.

Ralph: And then it’s ebitda, it’s about like earnings before interest, taxes, depreciation, and amortization, which is basically profit, net profit, like what’s left over than add backs. And then they wanna see a proven model of acquiring customers to affect better churn. The right types of customers and or clients.

Ralph: And then also increased profitability going long term. Because what they’re paying for is your profit right now. But really what they’re pricing you for is your profit in the future. And you also have at where I’m gonna actually be at this in June. You have a live, event in San Diego.

Ralph: Everyone wants to go San, so not Tell us about that one as well.

Chris: Yeah.

Chris: So it’s the first time in history, at least that I know of where there will be an, agency event talking and showing [00:33:00] you exactly how to build an agency that you can sell one day for eight figures or more. The speaker lineup is insane. Obviously Ralph’s gonna be there. We have people on the stage that have done over $650 million in exits.

Chris: People that have done it before, right? So if there’s nobody better to learn from than them, , it’s a small, intimate event. We’ll have about a hundred people there. , It’s workshop style and definitely do the

Chris: VIP ’cause then you can have lunch, and meet all the speakers.

Ralph: Okay, so agency

Ralph: freedom live.com, and then also for the freebie, if you’re like, eh, maybe not yet, but I’m sure you’ll email them or spam them to make sure that they go to go to the event if they go to agency exit plan.com. That resource is really good. that is the thing.

Ralph: It’s like you guys do it, right? And I’m not just saying this, that’s the reason why you’re on the show and the reason why you’re on the show is because I, the value that you bring, I was super impressed when I was there, what, four or five months ago. And ever since then, we’ve had this relationship where I think, , we [00:34:00] see where the, break right now is in the agency world and where it can be fixed and it can be fixed. it’s gonna take just a little bit more effort. And in most cases, most agency owners are like accidental business owners in a lot of ways. They kind of start it and they’re like, oh crap, now I’m managing people. I’m leading people. I gotta hire people, I gotta fire people. I gotta know finances. I have to know When you started it, you probably didn’t expect you needed to know all this. And you guys get all this. And especially with Amari who’s like just, , a ninja. , You get all this there. So, we’re not like pumping this up too

Ralph: much, but I, I really do believe strongly in this ’cause we do believe that this agency space does need to be, , rehabilitated to a certain degree.

Ralph: So check it out over@agencyexitplan.com for your freebie there. First five. Get that analysis first. P five PT listeners, like

Ralph: that’s a pretty big deal. And then, , checking out Agency Freedom Live, we’ll leave, all this over in the show notes over at [00:35:00] Perpetual Traffic. And of course, wherever you listen to podcast, leave us a rating and a review helps us get this to a wider audience, especially more agencies I suppose, so that we revolutionize this world that we live in and also help businesses grow the right way, which is what we’re all about here.

Ralph: So anyway, so glad to have you on, psyched to have you. Sure. You’ll probably be on again, Chris Martinez from Bloom Partners. So on behalf of, my amazing co-host who’s gonna catch a fish later today, Lauren e Petrillo, until the next show, see ya.

Chris: bye. Thank you.