Agencies economics do my little paranoic, presbyterian-pessimists head in.
Once again I am off on a below wonderful wage to a company who's business is probably so lumpy that it makes your blind grandmothers porride look of even consistency.
The issue with agencies is that they grow in non linear ways, completely sporadic and at the whim of the commisioning marketing director or senior brand manager at the client.
They either grow by reputation, hard pitching or selling more to the same customers. Every one of these hits a wall. Life's a pitch and then you die.
The company I am merily hopping off, bushy tailed to tommorrow COULD follow a route to producing a software revenue model by combining a browser - my Bot type set up and selling seats at clients. The value add could be in writing meta reports, doing set ups and then updating the system as the arms race on the internet starts to make obselite the once wonderful ( web promoter gold; remember that one?) A product is scalable in terms of sales, marketing and version management. Also today we could include cloud computing for bots, using down time to do crawls and indexing on a network of users machines. Problematic?
How much does it cost to get to a product ? Well it can be pretty well documented and worried about, while surprisingly getting a couple of big service clients and then bumbling through justifying your fees there and building up business on shoe leather, a wind, a single repeating prayer and all by the seat of your pants. Flights for directors probably amount to pretty much the same as a months programming here, or maybe a whole project in India.
Some how this is just accepted by investors, maybe because it is getting them near to the business and early raft investors are happy to see explosive growth on a handful of big-brand-name deals.
For my money and in this case time is money, I would go for the scalable product tied to a service, seat numbers and developments out from the core offering. Then we can get to be puppetteers and play at product management in stead of burning out shoes.