An Entrepreneur on the Road to Success Thanks to Relationships, Business Evolution, and Values

“Brands struggle to find the right marketing agencies. Agencies struggle to find the right brands. Setup is the matchmaker bridging the gap between brands and agencies.”  

This was the idea that Joe Koufman, founder and CEO of Setup, hammered home in two of his most recent interviews. 

Joe Koufman. He’s responsible for introducing at least 3 married couples in countless contacts to establish business relationships. In early 2014, he parlayed his passion for connecting people and founded a company called AgencySparks, which is essentially a dating service for brands and marketing agencies. Famous Five: Favorite Book? – The Challenger Sale What CEO do you follow? – Jeff Hilimire Favorite online tool? — Lucky Orange How many hours of sleep do you get?— “I try to get 7” If you could let your 20-year old self, know one thing, what would it be? – “I would have invested even more in relationships. They will absolutely pay off down the road”   Time Stamped Show Notes: 01:36 – Nathan introduces Joe to the show 02:29 – AgencySparks focuses on making connections for brands and agencies 02:34 – AgencySparks is paid by the agencies to help them with their business development and outreach to potential clients 02:50 – In many cases, AgencySparks can help subvert the RFP and the client will hire the agency directly 03:15 – One of AgencySparks’ clients tells them about Coca-cola’s water sustainability efforts and that they need the story to be everywhere 03:46 – AgencySparks was able to make a connection with one of their agencies that focuses on public relations and they made a deal 04:13 – AgencySparks is shifting their model now 04:20 – AgencySparks is traditionally paid by agencies to get them through a thorough, upfront, vetting process 04:27 – AgencySparks is getting paid through monthly retainers and a percentage of the deal 04:34 – The monthly retainer is $5K per agency, which is 12-month deal 04:50 – AgencySparks was launched in early 2014 04:58 – Joe spent years with KnowledgeStorm which was acquired by TechTarget 05:05 – TechTarget went public and bought KnowledgeStorm for $58M 05:26 – Joe spent 6 years building marketing and business development in Engauge 05:31 – Engauge was then acquired by Publicis 05:56 – When Joe left Engauge, he had job offers from 6 different agencies and that’s when he had the idea of AgencySparks 06:21 – Joe’s highest offer from one of the agencies was $400K and he said “no” 06:55 – AgencySparks is Joe’s first entrepreneurship stint 07:11 – Joe didn’t have any equity in KnowledgeStorm 07:45 – Joe made a big transition while he was at KnowledgeStorm 07:47 – Joe started as an account manager in 2000 08:05 – Joe moved to sales and realized that he was just going to have the same exact salary 08:23 – Joe did well in sales and had grown big accounts 08:50 – Joe’s last salary was $210K, in 2007 09:20 – By the time Joe left, he was making around $300K in 2013 09:43 – When Joe started AgencySparks, he knew that we wouldn't have much revenue, at first 09:52 – First year revenue was $270K 10:03 – Year 2 was $370K and Year 3: $430K 10:13 – 2017’s goal is to double 10:25 – To achieve their goal, they have to change their model a bit 10:45 – The client is asking AgencySparks for different options 10:59 – They want to have multiple agencies in one category 11:27 – AgencySparks currently has 11 clients 11:40 – AgencySparks has other revenue streams 11:48 – The commission percentage is 10% 12:10 – AgencySparks offers other services like info-product 12:40 – March 2017 revenue 13:00 – Team size is 4 and all are in Atlanta 13:18 – Greg Crabtree’s labor efficiency ratio is the idea of hovering between 2 and to 3.5, so for every dollar spent on payroll, you should be bringing in $2.50 - $3.50, in terms of revenue 13:47 – As a CEO of a company, if you’re not pulling out the salary that you would be making as a hired CEO, then your business isn’t profitable 14:00 – Nathan’s computation within The Top’s 600 interviews done with SaaS companies 15:04 – AgencySparks’ net margin 15:27 – Joe is the guy who would re-invest his money into the...

Following the interviews with Nathan Latka, of “The Top” Podcast and the Dana Barrett Show on Biz 1190, Setup’s CEO, Joe, spoke about the upcoming changes for the company, the need for Setup in the marketplace, and his entrepreneurial journey.
 

Joe Koufman (right), Setup founder and CEO, with host Dana Barrett (left) of "The Dana Barrett Show" on Biz 1190

Three major takeaways that provide entrepreneurial success and a competitive advantage emerged from the interviews: 

1. Emphasis on Relationships

2. Room to Evolve

3. Tireless Commitment to Core Values
   

An Emphasis on Relationships

In Nathan Latka’s podcast, titled “The Top”, Joe discussed how he has always excelled at making connections in his professional life, as well as his personal life. This passion enabled his ascent to success in multiple marketing agencies. Amidst his agency-side journey, Joe noticed the disconnected, troublesome road to finding a “perfect fit” between brands and marketing agencies, thus, the idea for Setup was born.  After Joe left the agency world, he turned down multiple job offers to create the initial business model for Setup:
Setup is the “dating service for brands and agencies,” Joe told Latke. “[We strive to] make connections between brands and agencies.” 

Setup makes connections between brand and agency marketers in a number of ways. One way is by holding quarterly Marketing Breakfasts. Here, Joe’s team listens to the concerns of clients about the marketplace and facilitates introductions in a more personal and comfortable environment. 

Read related posts about the latest themed #MarketersBreakfasts: 

#MarketersBreakfast - Molding Creativity in the Work Place

#MarketersBreakfast - Creating Fantastic Customer Experiences

Joe Koufman leading a discussion between Atlanta's top marketing brand and agency executives at the last Setup’s Marketers Breakfast.

Setup’s culture of connectivity starts internally. Everyone on the team is encouraged to share their ideas and opinions and potential opportunities for the company. He noted Greg Crabtree’s labor efficiency ratio to Latka: the need to bring in 2.5/3.5 in revenue for every dollar spent on payroll. If the ratio is high, his staff needs to increase as to not burn his team out. However, if it is too low, the profitability will suffer from too many employees. 

Setup’s team at a staff bonding event at Escape the Room.

Key takeaway: Relationships are everything. How you interact and treat your clients and staff matters. Success is reflective of how relationships are fostered.

Room to Evolve

Setup is continuing to adapt to the need of the market and clients. Since the founding in 2014, Setup has experimented with additional service offerings.  2017 is a big year for Setup, bringing along plenty of changes. 

For one, the business model has evolved to benefit the clients even more. Setup understands there is just not a single best agency for all clients. This insight led to the expansion of service offerings to include multiple agencies in each category, an Agency-Client Speed Dating service, and an option for clients to outsource their RFP process to Setup. Now, when a brand asks for multiple agency options, Setup has the ability to deliver. The speed dating format enables the client exposure to several potential partners without investing a lot of time and energy which results in a more efficient selection process. The process often results in a more “perfect fit.”

Click here to fill out a free, confidential form used as the basis of conversation between brand and agency. 

Setup is also a valuable resource for marketing agencies. Setup is working on a training series that enables agencies to improve their business development efforts. The web product is scheduled to launch in June 2017. 

Key Takeaway: Markets and clients will often dictate shifts in service offerings. Companies must evolve so they can thrive.

A Tireless Commitment to Core Values

Setup firmly stays true to its values - emphasizing them at every weekly company meeting.  Ensuring the entire team is aligned with the values enables the company to remain consistent as it grows. Also, clients like working with companies with compatible values.

Key Takeaway: Companies that live their core values tend to thrive more than those that have no clearly defined values.

Setup continues to challenge the market to unlock the keys to success. By staying true to the core values, adapting to the market, and constructing solid and loyal relationships, Setup is experiencing significant growth and setting itself up for the next phase of opportunities.

Key Takeaways from Nathan Latka’s “The Top Podcast”

• As a CEO of a company, if you’re not pulling out the salary that you would be making as a hired CEO, then your business is NOT profitable.

• Continue to grow your business as much as you can, but be mindful of the interesting offers that come along the way.

• Invest in relationships.

Key Takeaways from The Dana Barrett Show:

• What is right for one brand, is different for another...hence the need of a matchmaker like Setup

• Adjust business model depending on marketplace need

• Integrity is of utmost importance in any business interaction