Conference session · Apr 15, 2026 # Building an Agency from 0 to $35M: Lessons Learned @ Digital Marketing Europe Lisbon 2026 Lisbon, Portugal [Book this talk](https://www.alexmelen.com/contact/)[Slides (PDF)](https://www.alexmelen.com/assets/slides/building-an-agency-from-0-to-35m-lessons-learned-digital-marketing-europe-lisbon-2026.pdf) Video: [Building an Agency from 0 to $35M: Lessons Learned @ Digital Marketing Europe Lisbon 2026](https://www.youtube.com/watch?v=YRiz_kdIdKA) In brief In this keynote at Digital Marketing Europe Lisbon 2026, Alex Melen, co-founder of SmartSites, shares ten lessons from growing the agency from a one-man shop to a 400-person company, and argues that an agency has to keep growing or it starts to die. Alex argues that agencies have no patents, trade secrets or products; the service being sold is employee time, which makes forced growth essential, because top performers leave companies that cannot offer them promotions. SmartSites targets 30 to 35 percent growth every year, pays a deliberately low base salary with large performance incentives, and tells candidates honestly that the job is a grind. He describes how each stage, from 5 to 40 to 100 to 400 employees, required reinventing the company, first by placing the right department heads and then by building tight processes. He warns against accidental KPIs such as rewarding people for arriving early and staying late, and admits he still struggles to delegate and make himself replaceable. Key points - There is nothing special about an agency: no patents, exclusive distribution, intellectual property or real trade secrets. The entire value proposition is the time and skill of the people who work there. - SmartSites has targeted 30 to 35 percent revenue growth every year since 2011 because forced growth creates promotion opportunities; without them, the best performers leave and the company slowly withers. - Tell candidates during hiring that the job is hard and set expectations for real work, because no agency succeeds without people putting in the effort, regardless of AI or process efficiencies. - Pay a lower base salary but attach large incentives to nearly every role; SmartSites PPC analysts and project managers earn a percentage of the cash flow of the clients they manage. - Roughly 90 percent of people who quit do so for two reasons: they hate their boss or they feel unfairly compensated. Flat salaries with 1 to 3 percent annual raises are the worst incentive model. - Every growth stage requires reinventing the company. What got SmartSites to $5 million would have yielded maybe $6 million a decade later; at 30 to 40 staff department heads mattered most, at 100 tight processes. - Delegation is a superpower and the founder is usually the bottleneck. With 200 employees and no HR department, Alex personally ran final interviews and contracts, and hiring slowed because he was too busy. - Audit your KPIs for accidental ones. With an office, SmartSites ended up rewarding early arrival and late departure, even installing a fingerprint clock-in machine, which measured presence rather than output. - Make yourself replaceable and let people on the ground decide; if your absence breaks the business you have not built one, and top-down decisions are too slow for how fast the industry now moves. > “We don't make anything. There's nothing being produced. The value you're giving your customers is your employees' time. Literally everything you're doing as an agency is coming from you and from your employees.” [9:53](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=593s) · Alex Melen > “What got us to $5 million in revenue, if we kept doing the same thing at that point, we would have gotten 10 years later to maybe six million. You actually have to keep rethinking the process as you move forward.” [15:38](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=938s) · Alex Melen > “If you are the business, then you literally have no vacations, you have no downtime. Anytime you're not working, the business is making less money. At that point, you're not a business, you're pretty much selling your time.” [22:47](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1367s) · Alex Melen Chapters - [0:02 Introduction and Alex's background](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2s) - [4:19 SmartSites growth and the agency landscape](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=259s) - [8:31 No moat: people are the product](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=511s) - [9:53 Force growth and pitch hard work](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=593s) - [12:42 Low base, big incentives, owner's burden](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=762s) - [15:38 Reinvent at every stage and delegate](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=938s) - [18:28 Ignore accidental KPIs](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1108s) - [21:19 Be replaceable and let others lead](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1279s) - [27:12 Recap and audience Q&A](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1632s) Questions this talk answers **How should a digital marketing agency structure employee compensation?** Alex recommends a lower base salary paired with a large, clearly defined incentive for almost every role, such as a percentage of client cash flow for analysts and project managers. SmartSites pays above market overall and offers first-year or monthly guarantees so new hires trust the target figure. He argues corporate-style flat salaries with 1 to 3 percent raises remove any upside and push overachievers to do the minimum or leave. **Why do top employees leave agencies, and how do you keep them?** Alex cites two causes that account for about 90 percent of departures: people hate their boss or feel unfairly compensated. He adds that top performers will not stay at a company that is not growing, so SmartSites forces 30 to 35 percent annual growth to create manager and director opportunities. Pairing that with incentive-heavy pay and honest expectations about hard work has given SmartSites one of the best retention rates in the industry. **Are digital marketing agencies still needed in the age of AI?** Alex says yes, and probably more than before. Most businesses below enterprise size cannot afford in-house experts in every channel, a team's output beats a founder doing everything, and AI raises the floor for juniors while making experience and historical data more valuable. Even if platforms like Meta eventually automate ad management, he believes small businesses will still need strategic consultants to manage it. ** Full transcript 9,120 words · auto-generated captions, lightly edited for readability · timestamps link to the video ** [0:02](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2s)Good morning. Welcome to our stage. I am very proud and happy to present Alex Melen the person who knows how to scale business from zero to millions. And I think one of the things that he shared yesterday with me was that one of the challenges that you believe when you're like a small company is that when once you hire people you will be able to delegate things and that's the story that you would believe. From Alex perspective things are very little bit different. He still owns a lot of responsibility and he shares that burden every single day because I've seen how people call him and call him and he's like actively involved in business. So he has he runs a business where he has like 400 employees and I think like 399 of them know that they can call him every single day. He will know all the answers. So welcome on stage Alex Melen and let's hear the story. Thank you. Thank you for that intro. Thank you. That was a great intro. By the way, I don't recommend that for others. The having 399 people call you. I think that's one of my bullet points of what not to do, but perfect. So, I have great slides for you guys today. This is I think this is [1:24](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=84s)The first time I'm presenting something like this. I'm usually presenting like SEO, PPC, like technical stuff. So this was very interesting for me to even put the slides and ideas together and the thoughts behind this presentation is I wanted to distill the things that I think make us successful and you'll see a lot of the points I strongly believe in and follow. Some of them I think are important but I struggle with following like the 399 people calling you. But I'll walk you through literally all the things that I think helped us get to where we are today. Before I begin, I'll go through a little bit by myself and then I did my best to distill everything down to 10 I think bullet points. Just to get a better idea of the audience here. How many of you guys here have an agency even if you're a self-employed agency? Crazy. Everyone. Perfect. It's great that I think all of this stuff is going to be very applicable to you guys and I've gone through the journey from being the one-man shop to where we are today. So I think there's going to be a lot of great learnings. That's me in 1991. Very fashionable shorts I'm wearing. I actually immigrated from my family immigrated from the Soviet Union. I was [2:51](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=171s)Born in Kiev Ukraine. We came to US in 1991. I started my first company in 1997 for those that were involved in the space back then. That was the time of it was one of the first web hosting companies the time of GeoCities, Tripod, Hypermart. I don't know if any of those words sound foreign to you or you recognize them. That was that was the environment I started T35 hosting in. It's still actually alive today as opposed to all the other names I named. Actually predates the start of Google. So it was like literally the wild west. I've been involved in this digital space for more years than I want to do the math on. 2011 I started SmartSites with my younger brother. There's I think I have some more pictures actually on my next slide. It's actually 15 years today. We started April 15th. So today is our 15th year anniversary. I stole this slide from my team in the morning. This is going on our social media. Might already be on social media. I think it's a little early in New Jersey time, but might soon be posted on social media. U so we've come a long way since then. And I think the once we get to 10 points we're going to go through. I think it there's been so many learnings along the way regardless of where you are in the journey whether you're still up here or here or here. And this picture the 2026 picture is a couple days ago we do a yearly annual event and everyone who's willing [4:19](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=259s)And able we fly them out to New Jersey to meet. So obviously not everyone could u could come down but this was last week with a lot of our with a lot of our team. Also it's funny I've recently started using this. So a lot of our competitors took on private equity or sold out or sold their company. So fact-checking myself, we're actually officially now the largest there's a lot of asterisks. Largest private digital marketing company in the US. This is I use some AI to fact check myself. This has been our growth throughout since we started and I was actually those that sat with me at dinner yesterday. I was a little reluctant sharing financial information and this might in the end might turn out not to be the greatest idea. But I thought it was very important to just show our journey and be very transparent with the steps we took along the way. So what's interesting is we've always been very growth minded and I think it's very difficult to do that. So our growth our target growth every year has been 30 to 35%. Some years we've been over some years we've been under obviously COVID happens and the COVID recovery / COVID helped happens. There's always things going on. But I think one of the greatest achievements we've had as a company is being growthminded. I'll walk you that's one of the bullet points I'll walk you through. But this is this is where we are. This is core revenue. So I took out there's a lot of funny business that goes on in digital marketing as you guys know. [5:45](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=345s)There's prepaid spend. We still have the hosting business that we own. So I took out every all of that and this is literally our core digital marketing revenue. And to spot check, we did, it's funny, when I sent the slides originally, I think that the idea for the slides must have been like nine months ago. I was are we going to be over 35 million? We didn't make it over 35 million. So, I could I didn't have to change the title of the presentation. Before going into the actual learnings, just and this is super applicable obviously to everyone in this room and I what's interesting is I get asked this question very often recently, right, with AI and everything. They're "Is digital marketing still needed? Do I still does this space even exist?" "Will companies like yours exist?" And I think it's super needed and it probably more needed than it was before, but this is pretty much the landscape, The reason that my business exists, your business exists, is that most companies can't afford in-house team to do it all, and some obviously enterprise you do but the everyone except enterprise it's very cost prohibitive to have an expert on everything inhouse. With we also run into run into a lot of like founders who are like I do everything. I do the marketing I do the social media I do the email marketing I do everything right. [7:09](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=429s)The team output will always be greater even when the founder is involved and of course the value of experience and scale. I think that's going to be a big one looking forward, the experience and scale, I think AI is replacing a lot of things at the bottom level. I think it's raising the bar. Junior analyst who knows nothing now with AI could be pretty good, He's not going to be excellent, but it could be pretty good. But I think the value of experience and the data set you guys doing this for so long and having the data you could now use that data and com not only the your previous data but everything you're doing now to be better than people who don't have that. So I think this space will stay super relevant. I think it'll become I think it will become even more relevant. All right, things I learned. So, I'm going to go through all of these one by one and then I left a good amount of space for Q&A at the end. Some of this might be funny, but as I go through them, they'll make more sense. So, the thing the things I learned, Number one, there's nothing special about agency, and I'll walk through all of them. Force growth. Tell everyone the job sucks. Pay people very little. That's going to going to be a good one to go through. Give everyone's an owner's burden. Stop doing what you what got you here. Number seven is be lazy, ignore KPIs, make yourself replaceable, and don't leave. So, the last two are [8:31](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=511s)The ones I struggle with. Make yourself replaceable. I still didn't get to that, but I try to distill the best practices here more so than the things I've personally accomplished. So, we'll take it from the top. Nothing special about an agency, If you think about it, if you're doing any business analysis of digital marketing agencies, there's really nothing special about an agency. There's low barrier to entry. Someone in the morning could wake up in any country in the world and decide, I am a digital marketing agency. There's really nothing that stops them from doing that. They buy a domain name. You don't even need a fancy domain name anymore. You buy I am a digital marketing agency.com which actually might be available. And all of a sudden you are the digital marketing agency, There's no patents, there's no exclusive distributions, there's no intellectual property, There's nothing that creates a moat for an industry if you're doing a business analysis. There's also no tra no really trade secrets, There's some companies that claim we have proprietary this, proprietary that, but I think most consumers now understand a lot of that is So, I wouldn't even go down that route. The value proposition is literally your people. So, as opposed to a company that produces something like Ford Motor Cars, they make a they make a car, It's pretty straightforward. They produce a car, that's their product. As a digital marketing agency, we don't [9:53](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=593s)Produce anything. We don't have we don't make anything, There's nothing being produced. We're literally the value you're giving your customers is your employees time. So, I think that's very important to recognize because literally everything you're doing as an agency is coming from you and from your employees. Force growth. So, I mentioned this a little bit at the beginning. I think this is literally one of the most important things you could do as an agency. And I think this is where a lot of people struggle with in the beginning levels, When u when you are when you're a oneoff entrepreneur and you're trying to grow to next level and you're like now the first picture in my original screenshot now you're at 5 to 10 employees, the biggest challenge is to push that to the next level to go obviously to grow after that. The problem is that a lot of people stay there and staying there creates a couple of problems. In the long run, your best performers aren't going to want to stay in a company that's not growing. And I think that's going to be your biggest problem. We just looked at the other slide where it says your employees are your number one asset. If your employees are leaving because they don't have growth opportunities, you're not gonna be a very good company, So, I think it's super important and it's not for everyone, Some companies are okay. We'll stay at five employees. I'll make sure till that they stay by overpaying them or doing this or that or [11:20](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=680s)They get equity, but ultimately, if you want to grow and scale and keep growing, you always have to create the opportunity. So for us, by forcing the 30 to 35% growth every year, we're creating opportunities for current employees. So our current employees know that if they perform really well, they're going to have a opportunity to become a manager, director, whatever they want, Some people don't want that. Not you can't have a company of everyone who wants to be a director, You can't have like 400 directors in your company, 400 people. But you need to be able to create the opportunities for a top performers to want to perform better to be able to have the opportunities to raise with your stay with to get promotions within your company and stay with your company. This is a good one. Tell everyone the job sucks. It's digital world is very tough. So before starting SmartSites I briefly worked at media which is part of Publicis. I think they're now the biggest marketing agency and there was a lot of digital market a lot of marketing people there a lot of young digital stuff they were just getting into when I was there and it was a grind and people knew it was a grind but I think they enjoyed it and I think it's important to realize u that it will be a grind when you're trying to hire people don't tell them that oh it's now it's remote so you don't even have to work a [12:42](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=762s)Lot or put in a couple hours right I think you want to attract the right people by being honest with them that it is going to be a lot of work to deliver I think to deliver great results it's going to be a lot of work whether you have AI processes all that obviously helps but I don't think any company succeeded without people actually putting in the hard work that's an interesting one so the attention grabber obviously pay people very little but it's not about paying people very little we actually pay above market rates the idea A is to pay people a lower base salary and then incentivize them in other ways. So almost every single employee in our company minus maybe like three or four like there's certain ones that gets a little tricky to incentivize like HR maybe incentivize based on how many people they fire. I don't know. It's some of them are hard to come up with goals incentives but outside of HR and a couple other positions everyone in our company is has a very big incentive opportunity. What that means is if they do if they and again not everyone needs to like be the put in a 100 hours and do extra work, Some people don't want to do that and that's also okay. You need you need a mix of different employees. But for those that want to put in the extra time, there's incentives in place to reward them. And I think that's super important because eventually without that, no matter how you're rewarding employees, if you don't have that stuff in place, the overachievers will not want to overachieve and they'll either start [14:11](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=851s)Doing the bare minimum. And there's a lot of really smart people that are really good doing the bare minimum. So please don't incentivize them in a way that encourages that or they'll leave to a different company that rewards their incentives. So that's been a very big part for us and it helped a lot of people really make a lot more money if they want to put in the extra time. This is a big one. Give everyone a small business owner's burden. So you want to you want to build a culture where everyone thinks as an owner, We're we've always we've always been a very entrepreneurial company even though we're now a little bit bigger and not it's a little bit hard to maintain but you always want to be very entrepreneurial and all of you guys most of you guys in this room being the business owners you started the company you guys are entrepreneurial right but you want to encourage everyone within the company to also have those instincts so then that's a couple things in there you want to create a structure that empowers ownership right you want to you don't want to micromanage people you want to put the right people in place, the right processes for them and right people to support them and then let them make the decision. And based on I forget which report this was, but small business owners work twice as many twice as much as an employee. You guys know this. I'm sure all of you in the room are working a lot more than your employees do. But the idea is to set things up in a way that your employees really want to do as much as you and are [15:38](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=938s)Just have as much ownership and incentive to do that. All right. This is a good one. Stop doing what got you here, the and this is this has been a good one that I've that I've talked about at a lot of dinner chats, at a lot of conferences. It's been interesting for me to see the different struggles at different parts of the journey. And by seeing that, I realized how much you have to change, what got us to $5 million in revenue. If we kept doing the same thing at that point, we would have gotten 10 years later to maybe six million, you actually have to keep rethinking the process as you move forward, when we were smaller, I was very big in being involved in everything. I unfortunately still try to do that, although I probably shouldn't be. But generally speaking as the company goes bigger you have to now invest in processes and invest in team leaders and different things to keep growing. Every growth stage requires you to reinvent yourself and that's there's been nothing more true than that. You could see our growth is slowing down. We have to once again reinvent ourselves and think differently because if you don't you're [17:04](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1024s)You'll get stuck at the you could grow your company without reinventing yourself and rethinking everything and new processes but you'll grow at the five 10% you'll replace a lost client with a new client. You're not going to have the growth to u pull everything together. All right. This is this is one I struggle with. So, I run the company with my younger brother, and he's really good at some things. This is there's a couple ones that he's gotten really good at that I'm still lagging, but I didn't want to make this presentation about myself. I wanted to make it about the things that I've seen that helps agencies grow. And I think this is this is a big one. U so delegation is a superpower. There's a lot of people that struggle with it, me personally. But the less you delegate, the less your company will grow. At the end of the day you become the bottleneck. There were certain times where I was very involved in HR hiring. For example, we didn't have an HR department. We had we had 200 employees, we had no HR department. So I was the bottleneck of people getting hired. Even though I let others do the interviews and pick the people, I would do the final interview. I would send the contracts. I would review the contracts, I literally became the bottleneck. We started hiring slower because I was too busy to do that stuff. So this is this is always super important. Putting it in a more funny way, always try to do less, Very [18:28](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1108s)Hard mindset as an entrepreneur because as an entrepreneur, as a agency owner, you always want to do more, the idea, and this will require you guys after the conference going home and really like thinking about it, but you always want to deliver the best results, but do less. The less you're able to do in certain tasks, the more time you have on bigger picture stuff. And really investing in the growth of the company versus spending time inside of the company. Man, I'm going really quick. Rapid fire rapid fire growth ideas for you guys. Ignore most KPIs. Oh man, that this has been a tough one. We're always KPI focused. There's a lot of very strange KPIs that you wind up not even creating as a business, but you somehow wind up with them. For example, a really big one was come [19:55](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1195s)Early, stay late. So, when we had an office, and I've worked in the corporate world a little bit, too. In the corporate world, that's probably the most rewarded strategy you could have as a young employee working anywhere. You'll be the rewarded the most and perceived to be the best employee simply by coming in early and staying late. You could be doing nothing. You could be sitting on your computer playing Tetris. They see you're like the last person closing the lights when the office leaves. You get rewarded for that. So, and th there's a whole bunch of other KPIs that get developed that you might not even cognizantly think that you develop, but if you have an office by default and we had the office we were even tracking how many hours people were in the office, I remember at one point because people started coming in late and then someone's well, why is she coming in late? And I didn't want to be like sitting there writing down people are coming in. We did I set up a fingerprint machine at the door. People like sign in like clock in clock out and thinking about now I'm like how crazy is that? People like clock in and then sit there and stare at like the monitor without doing anything for an hour and be rewarded for that. Like I clocked in early and we would look quarterly at how many hours people work. So there's a lot of KPIs that get developed along the way that probably might not make sense. So this is always a good one where people to take home with you to think about the [21:19](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1279s)KPIs your agency has the intentional KPIs and a lot along the way that got created are not intentional. Another one, what do we have? The people who are not rude and not loud get rewarded because they don't create like friction, And the people who create friction in the company even though they're the best employees get penalized, There's all these little silly things that come along the way. We have moved to being very intentional with our KPIs. Now each department has very specific KPIs to hit that are not only logical to us but we actually work through with the department. We go to department heads, we sit down with everyone in the department and we work through like does this KPI make sense, How many hours you work per day? Is that an efficient KPI to reward people in your department? Probably not, So, I think this is a this is a big one. A lot of people get stuck on the wrong KPIs that really slows down their growth. This is another one that I struggle with. I think there were two there were two points I struggle with. This is this is one that I'm still probably a couple years away from. And I think it's a lot of it's personality driven and I always try to be better, but I'm still I still work with this. Make yourself replaceable. If your absence breaks the business, you didn't build one, and I see a lot of entrepreneurs and me personally, although now as our company has gotten bigger, it's been [22:47](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1367s)A little bit better for us, but I see a lot of entrepreneurs struggle with this where if you are the business, then you literally have no vacations, you have no downtime. Anytime you're not working, the business is making less money, And at the end of the day, if you think about it, at that point, you're not a business or a consultant. You're pretty much selling your time. The problem with selling your time is you're always have to be working to make money, So it's it becomes it becomes a struggle. Be extremely replaceable. That's how you scale. All the big companies have gotten really good at it. All the leaders of the most successful companies are very good at it. Doesn't mean that you're not important and you're not doing a lot of things, like if you take an extreme example like I look at Elon Musk he's doing everything at all times probably sleeping less than I do. But he made himself replaceable with a lot inside of the companies right a lot of the companies he could take the step back and focus on something else focus on I don't know going to Mars for a couple months and the other companies don't implode. So he's every successful leader has gotten really good at it. Some companies have that's an interesting one. Mandatory time off. That's an interesting one. I've seen a lot in a lot of companies. But you want to you want to create people and processes that run without you. I think that's the biggest struggle I see u in entrepreneurs and smaller businesses. [24:16](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1456s)This is a good one. Don't lead, let others lead. So th this one I could say I've gotten a lot better with. There's always personal development I go through. I've gotten a lot a lot better with this. I think for any company to grow, you have to get really good at this. And this is the journey trying to think of what part in the journey. I think when we got over maybe 20 employees, like up until like 15 20 employees, you could probably be the leader of all of them and personally coach them and be very involved. I think the next step after that, this was the big learning point that you want to empower people on the ground to be able to make decisions and that means a lot of things. Number one, first of all, you have to hire the right people. You have to know that they could make those decisions. You have to make sure they know that they could make those decisions, If they're afraid to make the decisions, that's also not going to work. And you got to put processes and things in place to support them and let them make those decisions. And it should be at every level. We give our employees, it's funny, the one feedback we used to get and we hire usually younger people. The one feedback from the exit interviews when people leave or get fired, the one feedback we used to get all the time and still get all the time is that we give people too much responsibility early on and not everyone is ready for that. But I think that's [25:43](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1543s)Super important. I think the whole culture has to be built like that. I think in today's age, companies have to be more agile than ever before. And I think without empowering all your employees to be able to make decisions, you're not going to be agile. If decisions have to be made at the at a very top level, you're not going to be fast enough to keep up in today's world. One semi-related story for you guys. Ritz Carlton was very, very big into this. Ritz-Carlton hotel chain. I forget what year, but they went through some ownership change. I think this was before they rolled up into Marriott. But the policy they made is they allowed every single employee, is it Ritz Carlton? Someone's got to fact check me later. I'm pretty sure I'm sure I'm pretty sure it was Ritz Carlton. They allowed every single employee to spend a certain amount of money without any approval if there was an if they could do something to improve the stay of a guest. So, for example, someone's staying in a hotel room, their kids toy got lost. I don't know. Housekeeping took it. Literally, the housekeeping lady gets called. They're "Where's the toy? We don't know. Maybe we accidentally took it. Maybe we didn't." That housekeeping lady has the ability to spend up to, I forget, it was more than $500. But every employee literally within the company was able to make that decision without any approval and they would never get in trouble. Spend up to a certain amount of money to make things right for a guest. [27:12](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1632s)I think things like that is what makes companies better. All right, I got the recap. Went through everything super fast. Rapid fire. We'll take it from the top. So, core truth, small businesses still need digital marketing. I guess not everyone here works in a small business space, but I call I see a small business space as very big. I think everything up till enterprise. Enterprise still needs it, But enterprise it gets a little different. There's more value for doing it inhouse perhaps. But I think every business is going to need digital marketing whether even if we five years from now Zuckerberg thinks that starting next year Meta ads will do everything themselves, He's like with AI Meta ads will run themselves blah. Even in a world where that happens, I think small businesses will need strategic consultants to actually manage that for them. And I personally don't think it's going to happen. U, I'll take you from the top. Nothing special about an agency, people are your value proposition. And it, you really have to realize that there's a couple agencies I know that are very big, oh, it's big on brand and marketing. They market themselves, but they really like deliver a bad product because they don't care about the people, That you're not producing a widget. You're not making anything. The your employees are literally with your guidance is the service you're selling. [28:39](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1719s)Force growth. That's something that we continue to do and trust me it gets harder to do as you grow bigger. It's a lot easier to go from five employees to 10 than from 400 to 800. But I think grow forcing growth is probably one of the most important things you can do. Without that I see companies getting stagnant. I see top employees leaving. I think after that it all slowly withers away. Tell everyone the job sucks, set expectations correctly. You want to pitch hard work. You don't want to during the hiring process make it seem like there's going to be no work to do and it's going to be you're just relaxing. You really want to create a culture where hard work is valued. And that doesn't mean working 100 hour weeks, went through a lot of careers when I was younger. I did investment banking for a little bit, That investment banking values the 120 hour weeks, That's about I don't think it has to that I don't think that's what hard work is. I think that hard work means actually being committed to delivering the best you can pay people a little initial base salary. So that one that one's obviously a little tricky. I think the takeaway there is you want to really think through your compensation. Corporate America for those I'm from the US. I know not everyone is here. Corporate America is all about set salaries with 1 to 3% raises per year, [30:10](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1810s)That's how corporate America is set up. I think that's the worst way to incentivize employees. And I think that's why today, if you look at the numbers in the US at least, employee loyalty is the lowest ever. 40, 50 years ago, there's a lot of people that would stay within the same company their entire life. Isn't that crazy? It's crazy to think about now, especially for people from the US. I don't know, in Europe, it's still a little bit different. In the US, it's gone really extreme, but 50 years ago, there's a lot of people, that's literally one or two generations ago. Their entire life, they would stay with a single company, would never leave, today I think average if you if you look on employees under 50, maybe it was under 45, average time they spend working at a company is 18 months, year and a half. People are jumping jobs every year and a half. How insane is that? I think I think a lot of that is the compensation stuff, Why people two actually there's literally two reasons people leave. It makes up 90% of all people leaving. Number one is they hate their boss. Number two is they don't feel like they're compensated fairly. It's not like you think there's a lot of other stuff like they fight with the co-workers or they don't like the company. It's all literally hating their boss and not getting paid enough or not being not feeling like they're not being compensated fairly. So, I think compensation is huge. I think try to not avoid try to avoid any flat [31:34](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1894s)Salaries or anything like that as much as you can. Give everyone an owner's burden. That's also a good one. I think as much as you can, you want m everyone to feel like they're invested in the company, If you don't, you wind up with poor results. If they don't, if they don't feel like they're and that doesn't mean making them an owner, doesn't mean that giving them equity or whatever, There's different ways to incentivize them to feel like an owner. But I feel like if you don't do very bad things. It's like one of those like I don't know something crazy is happening in with the client like their clients freaking out and employees like 5:00 p.m. I'm out. Like closes the door and walks away, If they don't feel invested in the business, if it's just a job for them, it's going to be very bad for everything. Stop doing what you're doing. Stop doing what got you here. Went through that one before. It's every step is going to have its own challenges. I don't know where everyone here is in the journey. Later on, if there's any guidance I could give if you're anywhere through the journey that I've gone through, I'm more than happy to share our challenges. But each step has been a challenge to overcome. And it's always interesting because you never know what the next challenge is going to be. [33:01](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=1981s)Dealt with before optimize your time be lazy we went through that ignore KPIs so KPIs are very important in the smaller digital marketing agency space like if you're not a bigger company if you have I don't know, maybe 10 employees, five employees. I feel like a lot of times there's really no KPIs at all. Which is I think without knowing what you're shooting for, you're really not going to accomplish it. So, I think developing KPIs and then for those of you that do have KPIs or a little bit bigger of a agency, I think it becomes important to evaluate your KPIs and make sure you don't wind up with silly ones like encouraging people to come in earlier just to come in just for sake of coming in earlier, the longer you've had your company, the bigger chance is that you've developed some very odd KPIs that probably don't make sense. Make yourself replaceable. That's the one that if anyone has any advice for me, that's the one I'm still working on. Personal development. You want to build systems, not dependencies. You don't want to become the bottleneck as I think for entrepreneurs that's in any not even agency space. If you're any entrepreneur, that's probably the biggest challenge to make yourself replaceable. And two things I'll say with that. Number one is if you don't, like I said, you'll always be a bottleneck of something. Like I don't know, I'm on a flight. I took a flight here. I went through London to get here [34:31](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2071s)At a dinner meeting. My flight from London to here had no Wi-Fi, which I'm not used to at all. So I was I was off the grid for 3 hours. It's terrible. It was terrible because I still haven't made myself replaceable. I was like I feel like a drug addict. I was sitting there like checking my phone like wait as the plane was landing waiting for like the satellites to kick in for the signal to come in. Don't be like me. Make yourself replaceable. And don't lead. Quiet leadership empowers team. That's also a big one. You want to you want to have teams that lead and be I think going forward it's going to be so much more important than before. I think 101 15 years ago where everything in our space we thought was fast moving. I think 2026 things are so rapidly moving it's crazy. I did a bunch of conferences speaking about AI when just came when it just came out three years ago. I would prepare the decks because they won the decks like a couple months ahead of time and by the time I would get to the presentation like it the deck was like garbage. Like none of it was true anymore. The industry I think going forward it's going to be moving quicker than anything we've ever seen before and I think if decisions are made at the top level you're going to become obsolete very quickly all right that's all I have for you guys that's my email address if you scan that's my LinkedIn and we have I think we have a bunch of minutes for eight minutes for questions we don't need a mic I'll repeat what you say [36:00](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2160s)So people one of my questions when you're How do you balance that with stabilizing? Yes. Very tough. So I'll tell you how we do it and I was speaking to some people at dinner last night and that also comes with challenges but the way we do growth. So we have different departments as I think most of you guys even smaller you have someone who does sales. So we start our growth with sales. So we hire an extra salesperson for us. We don't do any outbound. So all we do is digital marketing for ourselves. So for us, we're like ready for some more growth. We hire an extra salesperson. We put more money into ads to bring in the leads. The leads come in and then we hire more project managers to manage the leads and grow it like that. So it's for us it's been controlled. The biggest challenge with that is since we do we're in every industry and we literally we just I don't know bid more for PPC management. We don't control the leads that come in. And we try to be a little bit more channel specific but all of a sudden I don't know in one month all of a sudden 100 dentists come in right now and we don't have enough dentist experts. So definitely challenging but for us it's always sales driven. When we're ready to grow more, we hire another salesperson and we invest more in marketing and literally trigger everything after that. Like next [37:24](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2244s)Comes our project management, then comes the operations teams and funnel after that. Good question. Questions yes I don't get the point in because you said in the same time changing jobs don't you think that all this recruitment process is wasting? Yeah, good question. Yeah, good question. So, the question is, low base salary. So we actually have one of the highest employee retention rate. Apparently, I wasn't holding the mic close enough the whole time. Now it's loud all of a sudden. We have one of the best retention rates. So, it's not about, oh, just hiring and people leaving. People leaving is terrible. It takes months and months and months to replace people. But we're very transparent in the hiring process. So, we started giving them [38:50](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2330s)Guarantees for the first year because we feel confident they'll hit those numbers. So, so let's say your base salary is 50. From managing the clients that we think you're going to manage, you'll make another 100. So, you'll make 150, but we're so confident you're going to hit that, we'll promise the 150 for the first year, and then we'll take it from there. So, clear path of development for sure. It's especially with younger people that get their parents involved and this is when I was doing HR and I would be the bottleneck. The parents would call what do you mean you're going to he's going to make 100? I don't believe it. But I always want to create an upside because if you just do a base salary and a little bit of commission, there's no upside for them to overachieve. And not everyone needs to overachieve. You could just do whatever and we tell them if you do just the average here's the we have 60 project managers if you do the average this is what you'll make but if you want to overachieve this is how much more you could make I think there always has to be an upside for the employee otherwise they did I break some otherwise they won't want to work more I don't know if we could fix it I think the Any other questions yes question H good question. [40:21](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2421s)You could take it. It's been very interesting. We're now remote and have employees all over the US. We have international offices too. The younger folks is I think mostly US maybe a little bit Europe problem. Internationally hasn't been as jarring of a difference. Ultimately we've actually been okay with it. Surprisingly, if we were in the office, I think there'd be more friction because there's different work styles for sure. We see that younger workers younger workers put wind up actually putting in more hours, but they're not always doing work during those hours. And as long as you're okay with that, I think that's fine. Meaning like they'll go for a walk in the middle of the day, I think COVID recovery / COVID helped with those behaviors, but we also see it in younger workers a lot more. They feel more flexible during the day to do other stuff, but ultimately work produce it still comes out okay. But for sure there's different communication styles with not only other employees but with clients but ultimately I've been surprised how little of a dis disruption it's been. Ultimately they produce the same amount of work. They just work a little differently. Yes. [41:46](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2506s)Yeah. Or worse. And how interest does that work with profit? No, profit's been worse and worse. We're very fortunate that I run the business with my with my younger brother and we don't have like a board of directors or anyone to report to. So, can I share I could privately later share profit. Profit's been profit more as a percent has been worse and worse. So if we were a public company, our stock would be like in the garbage. Like no one no one no one likes when profit goes down. Yeah, there's a lot of challenges. Profit's not negative. We make money. But as a as a percent profit's been going down for sure. I think it's a little bit natural as you get bigger. I think the next couple years there's going to be a lot of opportunities to reverse that in the digital marketing space. I think AI is going to help make a lot of efficiencies obviously like again we don't make anything our cost 80% of our cost is employees and the marketing we do for ourselves right those are the only levers employees we just keep paying more and more there was a time in the US where everyone wanted like a 10% raise I think maybe still now we're not char we're charging clients the same we did years ago right so the there's very little price elasticity you can't charge your clients 10% % more every year, but your employees want to make 10% more every year. No, but it's [43:13](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2593s)It's for sure as a percent goes down, but I think in the next couple years there's going to be a lot of efficiencies to reverse that. But yeah, good question as a percent certainly it's gone down and but we're it's not a focus for us. Like when we like I said we do 400 grand a month in Google ads or 500 grand I don't get an ROI from that this year. Like I'll spend 500 grand this month on Google ads. I will lose money on it this year, but maybe I'll make money on it next year. And we're okay with that because we don't have a board to report to. Do whatever I want. That's the challenge. Yes, sorry, friend had a question. So I see that you are a leader in the industry but why do you think your customers prefer you and they keep doing business with you instead of other agencies? Yeah, good question. For what results do you a Yeah. Yeah. Good question. For us I think the biggest thing is reputation. Probably have the most fivestar reviews of any other agency. The way we do that is over incentivize and overpay our employees that then encourages them to over-deliver to our customers. And to that same profit [44:39](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2679s)Question over there. I think I was recording it so I don't know how public I want to be with this stuff but with upset clients we're very quick to give them free stuff and everyone at every level is empowered to do that to make sure we don't have upset customers. I don't want to have any upset customers. That's the that's I think that's I think that's where I was interesting. Yes. Yes. Can you give a few examples? Yes, for sure. When we were smaller even like 30 40 I think we had one minute left right so that might be the last question and but I'm available all this whole conference after to chat. When we were even we took our f so first we were like five to ten people it's that's so easy. I did everything. I was involved in everything. I knew everything. Everyone did everything. Everyone wore many hats. Then we got to like 30, 40 people. At that point, most important thing probably became putting the right people in place of each department. We put the right people and the right support. So I was there to support their department, but I wasn't personally involved with everyone in the department. So that was an important stage. The next stage after that was all about processes. So to get from 30 40 employees to 100 employees, you're not going to get there without very tight processes because if everyone's loosey goosey doing different things, your quality is going to be different for everyone. One client's going to get one result and another result. Everything's going to be a mess. So that to get to 100 employees processes became super important. [46:05](https://www.youtube.com/watch?v=YRiz_kdIdKA&t=2765s)I had to be very tight. Employees still need to be able to make their own decisions and do their own stuff and everyone's personality is different, but you need the processes to back them up and you need to have some guard rails with the processes. So that was a very big learning lesson for us when we got to about 100 employees because after that it's just so many people doing stuff that I don't know that if they don't have the processes to do things the way they should, everything will crumble very quickly. Or you got especially in today's world with the with the quiet quitting and everything at that point you wind up like with people quiet quitting there's a whole movement where quiet quitting is you don't quit but you don't do anything and if the company's big enough you get away with it so you need processes that was the big step and then for us now when we're at 400 trying to get to 800 I have not found the next step but it's definitely as you saw our growth has slowed down I think every time our growth slows down it always means that something needs to be reinvented a little bit to get it back up. Cool. Thank you guys. In this essential session, we’ll delve into critical—yet often overlooked—aspects of operational efficiency for growing companies. Learn how to streamline operations and scale your business to the next level. Date Apr 15, 2026 Location Lisbon, Portugal Format Conference session Speaker [Alex Melen](https://www.alexmelen.com/about/) Slides [Download the deck ↓](https://www.alexmelen.com/assets/slides/building-an-agency-from-0-to-35m-lessons-learned-digital-marketing-europe-lisbon-2026.pdf) PDF · 18 slides · 2.0 MB More like this - [Advertising Inside the Answer: Preparing for ChatGPT Ads and the AI Search Ad Economy @ Technology for Marketing / eCommerce Expo London 2026](https://www.alexmelen.com/speaking-engagements/advertising-inside-the-answer-chatgpt-ads-ai-search-ad-economy-technology-for-marketing-2026/) Sep 23, 2026 · London, UK - [Get Your Brand Recommended by AI: A Marketer's Playbook for Generative Engine Optimization (GEO) @ ANA (Association of National Advertisers) Virtual 2026](https://www.alexmelen.com/speaking-engagements/get-your-brand-recommended-by-ai-geo-playbook-alex-melen-ana-2026/) Jul 21, 2026 · Virtual (ANA) - [Turning Next-Gen Ad Formats into Marketplace Advantage @ AutosBuzz 2026](https://www.alexmelen.com/speaking-engagements/turning-next-gen-ad-formats-into-marketplace-advantage-autosbuzz-2026/) May 20, 2026 · Sitges, Spain - [Scaling Agencies: What Still Works, What Doesn’t, and What’s Next @ Digital Marketing Europe Lisbon 2026](https://www.alexmelen.com/speaking-engagements/scaling-agencies-what-still-works-what-doesnt-and-whats-next-digital-marketing-europe-lisbon-2026/) Apr 16, 2026 · Lisbon, Portugal - [Search Marketing for WordPress in the Age of AI @ WordCamp Canada 2025](https://www.alexmelen.com/speaking-engagements/search-marketing-for-wordpress-in-the-age-of-ai-alex-melen-wordcamp-canada-2025/) Oct 16, 2025 · Ottawa, Canada ## Bring Alex to your next event. Keynotes, breakouts, and workshops on AI search, digital marketing, and scaling a business. Tell him about your audience and he will come back with a talk built for the room. [Check availability](https://www.alexmelen.com/contact/) [Speaker kit](https://www.alexmelen.com/speaking/#kit) --- Source: https://www.alexmelen.com/speaking-engagements/building-an-agency-from-0-to-35m-lessons-learned-digital-marketing-europe-lisbon-2026/ · Markdown version of this page for AI agents and LLMs. Site guide: https://www.alexmelen.com/llms.txt