Ask an agency owner why they have not hired yet and you will usually get some version of the same sentence: I do not think I have enough.
Enough for what? Enough compared to what? The sentence has no numbers in it, which means it cannot be argued with, tested, or acted on. It is a feeling wearing the costume of a financial decision, and it delays hires that would have paid for themselves while green-lighting hires at the wrong point in the season.
Financial management at this level has very little to do with accounting. It is the discipline of converting every one of those feelings into a number you can commit to in advance, so the decision is already made before the emotion shows up.
Turn every feeling into a number
The move is to write decisions as conditional statements with thresholds in them. At X revenue, sustained for Y months, I will spend Z on this specific role.
Instead of saying I don't think I have enough, make it a how can you make this happen type question. Hey, when I get to $20,000 of revenue I will budget $5,000 a month for a creative specialist. Right now we're actually having a constructive conversation where you remove the feelings and you're able to really break down your business in a more meaningful way.
Written that way, the decision becomes a checkpoint you either hit or did not hit. For most agencies the first full-time creative lands somewhere between $15,000 and $20,000 a month in revenue, sustained, not spiked. Below that the salary is too small to attract someone building a career.
One owner in the group wrote the sentence properly on a coaching call in August: at $25,000 a month, a full-time shooter at $3,000 to $4,000 would take 40 hours a week off him. The coach agreed and added the missing line: the software and everyone else on payroll come out of the same $25,000, so do not treat it as margin you can spend.
The threshold has to include what happens on the other side. Hiring a creative for $5,000 a month buys their capacity and the shoot time it hands back to you to spend on sales. Owners who fill those recovered hours with busywork end up with worse margins and no idea why.
Start with your baseline, not your revenue
Before any of that works, you need one number that most owners have never written down: what you personally have to take home each month. Rent, mortgage, family, the actual floor.
That number is an operating input. Underpay yourself and you start making decisions from scarcity, which affects how you price, negotiate, and manage people. Overpay yourself and there is nothing left to grow with.
If you're running a 20K a month agency, is it reasonable to pay yourself a 20K a month salary? Probably not, because you have zero dollars left over for growth. Because whatever your baseline is, that is the amount of cash and oxygen your business needs at all times to just sustain you as your own employee.
Once your baseline and your overhead are set, what remains is the reinvestment budget, the number that decides how fast the business can grow.
This also corrects the most common self-deception at the solo level: an owner shooting everything themselves reports an 80% margin because their own labor is unpriced. Matt Giesow, who coaches owners in the group, priced it live on a call this September using one owner's two shoots from the day before.
If you were an employee, how much do you charge? Well, let's see, you made 1758 divided by, let's say 11 hours, you made a hundred and sixty dollars an hour. So if you're good with that, after everything shakes out, you're good with that. And that's not bad. I like to make anywhere from 250 to 300 an hour if I'm gonna get my butt up off the couch for something.
He was not telling the owner to shoot faster. The day was already full at two appointments, so the only way to make more was for someone else to be shooting photo-only jobs at the same time: "We need money being made while you're out doing that, too." Pay yourself what you would have to pay someone to do your job, subtract it first, and the real margin appears. For a properly run agency, 20% net is the high end of this industry and closer to 10% is normal. Margins compress as you scale, because you are trading margin percentage for equity in something that runs without you.
Budget by percentage, then hire against the calendar
Percentages make hiring decisions mechanical. Roughly: 10% of revenue to project management, around 25% to creative production, 10% to 15% to photo editing, about 20% to overhead and leadership, and what is left, around 35%, to sales, marketing, profit, and growth. Early on your percentages will run higher than target, because the first hire in any function always does.
The editing line has moved most since those percentages were coached. The $12,000-a-month bill in the Facts above, some months $20,000, was on roughly 290 appointments a month, and other owners in the group report their per-image cost roughly halving with AI. If your editing line is still at 15% of revenue, that is the first place to look.
The percentages are also how you notice a leak. The former owner who took in $1.1 million and spent $1.1 million had staff and pricing that should have produced $1.4 million to $1.6 million, and the editing bill was the leak. Nothing on the profit and loss statement was wrong. It was just never read against a target.
The percentages also give you benchmarks to hold people to. A project manager should be managing roughly their annual salary in project volume every month. A full-time shooter doing two shoots a day across twenty working days should be handling about forty shoots a month. The coach above set the same floor at his agency and enforced it: "I'm starting to lose money if those media pros aren't at least shooting two appointments a day." Shooters who ran below it for about two weeks were let go for lack of work.
The same arithmetic tells you your capacity ceiling before you promise a brokerage anything. Two creatives at two shoots a day, plus you shooting half the time, across twenty working days at a $600 average order, is about $60,000 a month of capacity. Above that line, the constraint is hiring, not selling.
Then check the calendar before you sign anyone. Hiring in September means training through October, one productive month, then the three slowest months of the year. The exception is when you can see doubling in booked work.
I had someone ask me yesterday, like, I should hire someone right now. And I'm like, show me your schedule, dude. I think I've hired one person in my life in September, and it was because somebody quit, not because I was, like, growing at this point.
The mirror image is hiring under pressure. Three brutal weeks is not a trend. Three sustained months is.
Move the cash forward
Cash flow problems in this industry are usually timing problems, not profit problems. The fastest fixes are structural.
Take payment up front wherever the relationship allows. Getting paid at the start of the cycle instead of two weeks after delivery pulls an entire month of revenue forward. One owner in the group went further this summer and offered his two biggest clients a discount to pay for a year up front: "I made 50 grand off of that." On anything over $5,000, take 50% before production begins and another 25% on the shoot day. Ask your larger vendors for net 15 or net 30, because that is exactly what your clients are doing to you.
Two instruments are worth having before you need them. A credit card used properly buys a month of float for free. A line of credit, which most banks will extend once your profit and loss statement is clean enough to read, smooths payroll through a slow stretch at around 10% interest. Aerial Canvas carries a quarter million dollar line for exactly that reason. Treating it as a rescue fund is how agencies end up owing money they cannot service.
Keep one and a half to three months of overhead in the business account. Beyond that, idle cash is doing less for you than a trained hire would.
One caveat on retainers, the most common way to advance cash: a year paid up front is an obligation, and the payroll to deliver it arrives over the following twelve months.
Where this goes wrong
Tracking that never turns into action. The point of the reporting is the decision it produces, not the reporting.
Numbers don't mean anything unless you're going to do something with the numbers. I used to have all my departments give me reports monthly. I never looked at any report. It's just like, I'm wasting everyone's time, including my own.
Running on a two-year-old mental model. Owners describe their finances using information that was accurate when the business was half its size. Reassess quarterly at minimum. The audit Matt Giesow now runs for the owners he coaches is one week of real jobs, timed and costed: "we take a sample of a week, we look at your team and we just make sure that you're as profitable as you think you are."
Assuming your market is everyone's market. At the August Process Lab, Don reported his agency had not slowed down since March while owners in other regions were posting "half of what we did last August." Brendan's forecast in September was a cliff in November and December, with revenue at half the current run rate and possibly a third. That is a forecast, not a result. Build your plan on your own booked work.
Mistaking projections for the work. Take last year's monthly revenue, apply a growth assumption, and you have a forecast in ten minutes. The projection does not produce the growth. New partnerships, new products, and trained people do. Also log what actually happened each month, the weather, the market, the brokerage that signed, because next January you will not remember.
Over-engineering the dashboard. Track the handful of metrics that change a decision at your current size. The newer version of this mistake is building the tools yourself. One owner at the September roundtable had an AI rebuild his $200-a-month project management software and then found he was the one on call whenever it broke. Brendan's reply was to price your own hour first, at $100 or more, before deciding what to build instead of buy.
Do this consistently and decisions get faster and cheaper. A monthly profit and loss statement itemized by category tells you where every dollar went and makes the next hire obvious. In a good month at one agency in the group, $110,000 in revenue produced about $25,000 in profit after every line item, including a partner's full salary. That visibility is what lets you invest instead of hoarding cash out of nervousness.
The delayed return is larger. The same reporting that runs the business is the reporting a buyer will eventually price it on, and businesses that can prove their earnings get paid for them.
Both full sessions are worth watching: Financial Management for Growth for budgeting and hiring thresholds, then Cash Flow Projections Simplified for the forecasting sheet behind it. Start this week with two numbers: your personal baseline, and the revenue threshold that triggers your next hire. Then see what your agency is worth in a few minutes.
