Tech journalist and pretty cool dude John Biggs recently published a fascinating tweetstorm on the lack of viability for startups and the American Midwest. You may hard disagree with his points but John Biggs has been covering startups for 20 years and his points are almost certainly backed up by his own prolific experience in the field. In one of his first tweets he describes his efforts to be a Midwest booster as not having panned out so it’s not as if he has an axe to grind against a vast swathe of the country.
The whole tweetstorm is worth a read regardless of your opinion and own experience on the topic. One tweet of his stood out to me in particular: “What works? By all means build a dev agency or marketing group or whatever. Build your company in Madison or St. Louis and enjoy the beer. It’s great.”
Can you really build a marketing agency from anywhere, as John alludes to?
You’ll find no shortage of people – usually with a financial incentive – telling you yes. There’s a sprawling cottage industry of self-styled business coaches willing to tell you all about how, in the words of one I just Googled: “Let me tell you how I went from virtually no marketing experience to building a 6 figure digital marketing agency in less than 1 year and now how I’m making $50K per month, serving 50 clients across the US.”
These stories are hugely exaggerated and often come with a mountain of caveats, but that’s a topic for another time. My point is that there are people telling you that from home with nothing but a laptop and a desire to learn you too can be a marketing agency hotshot! What’s more, you can do it even if you live in the Midwest!
The reality is, as is often the case, much more complicated.
Three years ago I wrote what is in hindsight one of my favorite articles on the long, arduous road it takes to become the type of marketing consult that can be self-sustaining, let alone a top tier one that gets paid tens of thousands of dollars for speaking engagements. Many of the problems in that piece are similar ones you’ll run into when starting a marketing agency but they only get worse when you start one in an area like the Midwest (like John I realize Midwest is a very nebulous term but it’s the best I’ve got for this situation).
The first problem is not only competition, but the context of your competition. The issue with any kind of marketing agency is that competition is absolutely everywhere; in around 2010 we entered a massive marketing agency gold rush that lead to a glut of articles flat out telling you why you should start your own marketing agency.
So the big hurdle is that while I’m sure you have a great idea, a lot of other people have had similar ideas. What’s more, a lot of those people are in urban centers like NY, SF and LA and they’re going to have massive advantages over an aspiring marketing agency in the Midwest for a simple reason: It’s where the money and many of the lucrative clients are.
John mentions that you cannot get money or scale in the Midwest, and this applies to marketing agencies as well. “Fine,” you think. “I can bootstrap!” I don’t doubt that, but consider the situation at this point. A marketing agency in the Midwest – even in a city like Chicago or St. Louis – is going to be competing for the same clients as a huge number of lavishly funded, well-connected agencies in NYC and SF run by branding veterans with lots of experience.
While it’s true that you can start an agency “from anywhere” and that you can work remotely as long as you have a working Internet connection this is a double edged sword. These agencies are going to be able to spend huge amounts of money advertising, networking and searching for the biggest clients in your area. Which more often than not they will do since a lot of these agencies have the same ideas you probably will about being able to work with any company in any part of the US.
Connections are also something it’s difficult to compete with. Being in NYC or SF as an agency potentially gives you access to untold resources that agencies in the Midwest could only dream of. I was once a contractor for an agency in NYC that was in the running to secure a lucrative contract with a financial technology firm that wanted to scale. What gave them the edge was that several of the agency’s employees had personal and business relationships with senior employees of a very large financial firm that would be of tremendous value to the financial technology firm.
Naturally the agency closed the deal and it was explicitly because of these connections. Unless you’ve recently moved to Chicago or St. Louis and have a huge network to bank off of this is a disadvantage you’ll never be able to overcome. Marketing agencies often aren’t charging for their expertise on a particular topic; they’re charging for access to resources, and the resources in NYC and SF are going to be far more lucrative for potential clients than the agencies working out of the Midwest unless it’s a very specific niche like a brewery that would benefit from Midwest connections. Fair? Probably not, but that’s the state of play.
This especially applies to the types of larger clients who will just put out requests for proposals for agencies on a general scale. Your application is going to be standing next to ones from those same glitzy NYC or SF-based agencies flush with money and the ability to introduce clients to the resources they need.
Being an all-remote marketing agency in the Midwest gunning for big, lucrative clients in NYC, SF or LA was at one point more viable when it was a less popular career path. I remember a lot of stories from 2009-2010 when remote work really started taking off how amazing it was that companies based in Oklahoma or Kentucky could work with companies in NYC or SF without ever meeting face to face. Except as of 2011 there were 12,000 marketing agencies in the United States alone and the number has almost certainly exploded since then.
This leads to an unfortunate reality of being an agency in the Midwest. As a general rule – though there are exceptions – companies much prefer local vendors who they can have face to face meetings and discussions with. Not to mention people who are in the same time zone. You will absolutely have access to plenty of clients in Chicago or St. Louis, but there will be fewer opportunities than there would be in coastal cities.
This is where my own experience comes in. Web hosting is a very, very crowded field; it’s estimated that there are a staggering 330,000 estimated web hosts worldwide. The way I’ve been able to consistently grow is with a very specific niche and more importantly a focus on my local market. I’ve had a number of clients leave larger web hosts and work with me explicitly because they like the fact that they can put a face to the company. Over 100 clients can call me and have me at their door in less than an hour (usually). That kind of peace of mind can be crucial to companies working with marketing agencies on a big website rollout or product launch.
Where you are matters. I doubt I’d have landed even a fraction of my clients if I weren’t local. Could I now pack up and start working from a beach in Hawaii? That’s…unlikely. I’d have 100 clients lining up to crucify me, for one thing. I’d also not be able to do on-site meetings, take photos, or work with people in person who prefer face to face interaction.
Heck, I can tell you about my own failures. While my own marketing consultancy wound up fizzling out, part of what kept me sustainable as long as it did was the fact that I was working local. Most of my clients eventually let their contracts with me lapse, but I got lucky. I happened to have the type of client base that I could spin into something much more viable with more of a utility-based need. Most of my first generation customers rehired me after I’d gotten out of marketing.
So my advice would be similar to John’s and it’s the path I’ve taken with web hosting. Work local and sell cost-efficient services to local businesses in your area. Bootstrap. Don’t try to dress yourself up as a top tier marketing agency or compete with them. Grow slowly and don’t bank everything on securing high-powered clients in NYC that you’ll almost never be able to close.
In short, don’t try to be something you’re not and know that where you are absolutely does make a difference when it comes to business. Even in this era of “work anywhere for anyone.”
Most of all, enjoy not having to commute to work in the notorious NYC subways. Living in the Midwest does have advantages, after all.