SPEAKER_00 0:01

This week on the agency hour, we're chatting with Brandon Hearst. You won't want to miss this one. We break down how Brandon went from $8,000 to $34,000 in recurring revenue in a single year, how his stress level has dropped thanks to his growing team and this recurring revenue, and dealing with pushback and never trading time for money. I'm Johnny Flash. Stick with us. All right, welcome to the agency hour. Today we've got Brandon Hearst from Behurst Media joining us from Spokane, Washington. Hey Brandon, how's it going? I'm doing great. How are you? Awesome. Hey, well, um, I wanted to dive into kind of this whole, you know, selling projects as a payment plan and how you've really grown your recurring revenue because it's been an extraordinary kind of journey over the last year, particularly. So uh tell us kind of where were you, you know, a year or so ago with like recurring revenue and were you doing any you know projects as a payment? And to kind of tell us where you were there, and then we'll kind of jump to now.

SPEAKER_01 0:57

Yeah, so um I've I've definitely grown quite a bit as far as recurring revenue goes. Um I've always been the more the typical agency model of like doing like a one a big project where we have 50% down, 50% done, or paid when it's done and basically ready to launch. And then we have care plans. So we've always had some like the technical support care plans, and those have helped with recurring revenue quite a bit. But what I was coming into the play of is a pretty big roller coaster of like up and down months of like basically we things are great. We just had um four new projects sign on, but then we have that in between time where we're working on the projects, and then that next month looked at it. And every time I looked at the numbers, I'm like, I know we're doing good because like we've we're having this stuff, but um, I mean, if if it came to the point where like we're dry for a couple months and um we we had to like have keep make sure we're like keeping that like little little bit of flow there so we're not running into issues there. And one thing I wanted to do is really grow my team, and that was that was a big thing that I was focusing on, and because like I I want to make sure like my recurring revenue is um there so I can for sure say, Yeah, I can we can make payroll, not gonna have any issues there or anything like that. So that was a big focus for me. Um, so about I'd say like December last year, towards the end of the month, um, I started like really kind of diving into like how can I make it to where um we make it a little bit easier on it and spread it out to where I'm never gonna have any issues. And oh for me, I just feel more comfortable with like having a uh consistent recurring revenue versus those up and downs. Yes, I'm making the same with it, but at the same time, it just makes the books so much easier when I know like okay, we're gonna get another um X amount this month, and next month we're gonna be growing because we're getting this, and it just made life a whole lot easier with making managing everything. So where I was at, like, yeah, yeah. Um, so I was just gonna say, so where we're I was at as far as like um I was re-curring revenue-wise, we're looking like right around like $8,000 a month with it off just like the care plans. We saw, like I said, we still have those one-hour projects, so the my revenue was high, but my re-occurring revenue was low. So what I started doing is breaking up like how um like those big projects and started doing more payment plans with them, um, to where like we split it up over six months, 12 months, whatever, and we're getting the consistent stuff in there. It's a break for my clients, so they don't have a huge bill on right up front and right at the end. But and then also it makes it so it's more just easier consistent payments. But then for me, it made it to where I can bring on projects and still support everything without re-occurring revenue. I know stuff's coming in, so I'd um over the time I brought bumped it up. Um, we're looking at right around 34 um thousand for in uh uh the eight thousand to thirty-four thousand over this past year um comparison.

SPEAKER_00 3:43

So there's it's probably eight thousand to four. Wow, eight thousand to thirty-four thousand. That is just incredible. In one year, recurring revenue like quadrupled.

SPEAKER_01 3:54

So yeah, and that's I mean, we still have some one-off projects, things like that, but like the the I don't I don't really focus on those one-off projects. Like the only my bottom idea and or line that I focus on is every kind of revenue. So that's that's what I attract there.

SPEAKER_00 4:08

Wow, it's that's amazing. Definitely have been improvement there. That's amazing. So let's dive into this a little bit more because I'm sure people have thoughts, you know, questions in terms of like how does this exactly work? So you're you're you're doing a hypothetical, you're doing a proposal. Let's say it's normally would have been a $15,000 project. You would have done your 50% up front, whatever, whatever. Like, what does that look like now? Do you give them the choice? Do they have to do the payment plan? Is it the same amount? Is it different? How does that factor in with like what you would have charged, you know, $15,000 up front, and then you would have had some kind of monthly care plan, you know, after the fact? Like, kind of walk us through that.

SPEAKER_01 4:45

Yeah, so for me, like if we're doing a payment plan, um the a couple of questions that always come were coming up for me in the beginning, and I'm sure a lot of people get the same kind of ideas, but it's like, well, one, what happens if they stop paying? Like, um, do they just get the website and it's on their server and there's nothing you can do about it? Um, two, is there like what if something happens um 10 months down the road, at least have two months left? Obviously, you're gonna want to still fix it for them. So, like, how do you make it to where it's still profitable for you and the business and make sense for the client as well? So, because like, I mean, they're still feeling they're still paying you um 10 months down the road, and they may not be like you may have been done with the project, but um, what we decide to do is like take a care plan and put it, build it into the price for that payment plan so that way like we're still getting um payments through that, and we still feel like we're still getting paid for those months. Um, it's just it makes it to where we don't really have to focus on like, okay, yeah, we're the project's been done, they messed up the site or whatever, we have to go in and fix it. We can just go in there, jump in there, and do it for them right away. So, what it does for the client is like they are paying more, um, obviously over those the 12 months or whatever, how many months you decide for that payment plan. But at the same time, um, you're still getting the technical support along with it, you're still working on that. They're they're a regular care plan customer, as is when they what site launches. But then when you go to move them off that, you it's an easy transition to a care plan. So you don't have to call say, Hey, now that your website's done and you're done with your payment plan, um, everything there. They we just say, Oh yeah, uh, as soon as the um plan's done, we just your price drops down to this, and then that's covers it for the technical support. That's stuff we cover in like the very beginning of it, so that way there's no like confusion. I don't have to um message him and ask him again, like, hey, do you still want to sign up for um technical support? It's just expected that once that's done, it gets dropped out into it. So that's those are some of the questions I had, and um, I've been asked that quite a bit with for from people. Um but yeah, those those are the main kind of things. And as far as like a one-off projects, we still do some of them because there's some clients that they just they want to get it done now, they and they just want to pay for it now. Um I will still do them. I I just strongly kind of push still towards the um recurrent revenue side of things or the the payment plan side of things, because like for me, like I said, I I that's what I care about the most, that's what I want in there. And then it's it's an easier transition for the care plans, and then also um when you do have the like the one-off projects with the other things there, it just um it's still nice to have them come in. It's just more of like the transition between the two. I'm I'm able to get a little bit more out of it over the 12 months. Um, because typically if they're a one-off project, they aren't necessarily um that you have that other cell that you're gonna have to go in there and talk about the tech technical support later on.

SPEAKER_00 7:38

So that's just one of the things that it makes it easier when you do have the payment plans versus the one-off projects, right? Right. So if it was the $15,000 in the example, if it was the $15,000 project and you were gonna put them on, I don't know, $150 a month plan, let's just say, then, or or maybe even $250 a month plan. So that would be like $3,000 over the year, you know, for the care plan. So then are you basically like pitching that as in that example as like an $18,000 project that they can pay for over 12 months to like $1,500 a month kind of thing? Yeah, so I that's basically what I do there.

SPEAKER_01 8:16

Um I typically will make the payment plan overall cost more because like um just because that's when they include the technical support in it. So, like for instance, if it's let's say just for a quick numbers to throw out there, we have a $15,000 site, you add $2,000 onto that for the payment plan, divide it by 12 or whatever it is. Um, that extra $2,000 is gonna be for basic technical support there. And I do give kind of a discount on technical support during that time because they're already paying for the website. That is one there. So I don't take like the full amount that they'd be paid on for like a care plan and add it in. You could do that for me. I just because I know how much we're gonna be paid each month, we're good to go there. Um, that's just how I do it.

SPEAKER_00 9:00

So it's kind of like a it's it would be the same as like someone who maybe takes a payment for a care plan, you know, a year in advance and they might give a month or two off, right? It would it's kind of the same type of thing because you know you have the money, you know they're gonna be on for a year. And I'm assuming, um, kind of giving you the softball here, but I'm assuming that you're hosting these sites because they owe you money so that way if they ever stop paying, like you can kind of turn it off, right?

SPEAKER_01 9:25

Yeah, like um I I went back and forth with that because like there there are like we we host most of our client sites anyways, but I've had some people say, well, can we host it on my server and do that? And it's like um totally fine moving it over once the payment or plan is done. Um the main thing is like, yeah, if they could if we get it done in um our project time like four to six weeks, and then they still have that rest of the year to pay for, um, there's nothing I can really do if it's on their server and they lock me out. Like, I mean, we can put like fail safes and things like that in there or um take them to court, do that, things like that, but I don't want to have to take get to that part of it. Like that's never fun for anyone. So, but if you just have it on your server, like that like um rather than on theirs, they don't there's not really that like question of oh, I don't feel like paying them anymore and kind of go from there. It just it's you you have more control over that with it.

SPEAKER_00 10:19

And do you give them uh real technical minor question, but do you give them admin access when it's on your server, or are they like at an editor level or somewhere where they couldn't just like clone it off and and run with it?

SPEAKER_01 10:31

So we give them admin access still, um, but we disable like adding plugins and things like that. Okay.

SPEAKER_00 10:37

Okay. Yeah. Okay, so gotcha. Yeah. Cool. So you've gone from 8,000 to 34,000 and recurring in like less than a year, which is amazing. Um, what what has that allowed you to do in terms of like team development and stuff like that? Because I would imagine having that consistent revenue, you're you're able to you know bring people on a little bit more confidently, knowing that like the money's gonna be there tomorrow and next month to pay them. Yep.

SPEAKER_01 11:04

So it's been great. Um, my team has definitely grown. We're up to four developers, an SEO specialist, a project manager, and uh executive assistant. So we've had quite a bit of growth with it. Um as far as like the team, um, it's it does make it a lot easier because like I mean, as you guys all know, there's always gonna be some months that are a little slower than others. So like when I go into those months, I don't feel any stress anymore with it. Like, I don't feel like I have to put a shot like some random offer to a bunch of people just to make um rent or whatever for it, uh or make payroll or do anything like that. It's just one of those things where hey, we we know we have these coming in. And um the nice thing about the reoccurrence revenue with it is since what's already up there and it's based off of like um they're not like huge payment plans or anything like that, they're um consistent enough to where like if one or two end or we um have a couple people cancel with stuff, we're not gonna run into any issues because we're hitting everything there, we have our profit margins all set up pretty well. So those are the big things that we um it just makes life a lot easier as a business owner. I don't have to worry about it.

SPEAKER_00 12:13

And I would think that in addition to kind of making life easier and you know being able to kind of know you you can pay your team and if it slows down slightly, it's still gonna be there. I would imagine that when someone's year as an example comes up, and let's say they've been paying $1,500 a month or $2,000 a month or whatever for this payment plan, I would imagine it's probably a little bit easier potentially to upsell them at the end of that, because rather, you know, if they're already paying $1,500, $2,000 a month and they're gonna drop down to let's say a $250 a month plan or $500 a month plan, it's not that hard to say to them, hey, you can drop down to $250, but if you want us to keep doing this SEO work or these Google Ad Management or whatever the thing is, like, hey, it'll only be $750 a month. And so their payments going down in half or more, but you're still able to like offer them services. I don't know, that just seems like a easier sell than saying, like, hey, you just paid $15,000 for this website. Now you got to now fork out you know this extra money for these upsells that we're trying to do for the recurring.

SPEAKER_01 13:12

Oh, yeah, 100%. It's it makes it a lot easier. Like, um, I tested out with some six-month payment plans um in the beginning. So like I've already had some people go through that. And um the people who have gone gone through it, I've able been able to like put them on higher um support plans where we are doing more, like building out landing pages for them or having like more support as far as um doing a little bit of SEO or doing a little bit of um like graphic design for things that would typically cost more, obviously. But um, we they it it was an easy sell because it was still cheaper than what they were paying before.

SPEAKER_00 13:46

Yeah, yeah. I just think that that gives you so much room if they're at 1,500, $2,000, $2,500 a month to get them, you know, still at a $750,000 a month plan going forward. I just think that, and you've built that relationship for a year, right? So, I mean, typically, like if we do a website build, it might be eight to twelve weeks depending on the complexity of the project and stuff. But um, so we have some relationship that we've built up with them over that eight to 12 weeks, but I would imagine after they've like been working with you for a year, it's even more so solidified that like they're they'd be kind of scared to you know suddenly like not have you in their corner when you've been there this whole time, which which I think is just really great. Um what would you say in terms of um I because I I imagine that you have more costs up front, right? You build the website, you said over four to six weeks, even if it takes you eight weeks, a lot of your cost obviously is up front, and and then you know, so you're you're front-loaded with the work, the payments are coming over six or twelve months, so you're kind of getting most of the money after the work's done. Does that create any kind of issues or anything that like um as you kind of deal with that?

SPEAKER_01 14:58

Um I mean, I I just need to space it out, and that's one of the things that we have kind of run into, which is why I've had to scale the team a little bit more than I or faster than I expected. Um, but at the same time, since we do have like the those coming in, I don't I don't um feel like it's a hard thing to do to like step back a little bit and scale more or hire bring on some more people because it's like I know what I'm gonna have for the next like 12 months. I like I have my whole map of how everything's gonna look out for it. And then with that being said, as soon as like if we do need to scale it up, I can just say okay, um, yeah, we can start your project next week or whatever. I have people ready to go, I have contractors and stuff like that that are um available if I need to hire on extra on people for it, so which is nice. Um, so like the cost of things up front, um, since we've already been doing it, I we have wiggle room already in like our current budget to where we can easily do that if we need to run into it, but knowing that we'll be making it back later on. So like there is a little bit of push and pull with it. Um, the the main stuff though is like just knowing that we have the extra stuff coming in next month and what it's gonna cost next month. I can like um there's other services out there too. If I need to bump stuff up or bump stuff down, I I have a little bit of back play with it. And then we have some um a couple of our developers are part-time. So if I need to um or ask anyone if they want extra hours or anything like that for a couple weeks or stuff like that, I always have a lot of people who are definitely interested in doing that.

SPEAKER_00 16:28

So mainly just what I hear you saying, I think, is just if you space out some of the start of the projects, like it'd be bad for you to have four clients potentially sign on in the same week, right? Because all those timelines would be real crunched. But if you can have one sign up now and one, you know, in a week or two, and you can kind of just keep those kind of uh a little bit of space, then that kind of probably helps a lot, right?

SPEAKER_01 16:50

It it does definitely help. And I did have um that kind of happen, which is why I ended up scaling pretty quick with the team, like more faster than what I expected with it. But um overall it worked it turned out good because I was still able to get the stuff going and get things those launched. Um, we have had like some projects where things have been a little delayed with it because of things like that. Um, but at the same time, like my the clients were all understanding we talked to them and got things set up and ready to go. So um as long the main thing is as long as you're communicating with clients and you're upfront with some of the stuff with it, that like obviously they're gonna be more than happy unless there's like a real specific deadline and you can work stuff around that.

SPEAKER_00 17:29

Do you have you ever gotten any pushback with like because I because I what I hear you saying is you're you're kind of steering people toward the payment plans, you know, because that just has the consistent revenue. Do you get any pushback? Is there people that are like, I really don't want to pay, you know, two grand for the next year?

SPEAKER_01 17:45

I mean, like I have I've had a couple people where they just want to do the one-off projects, and I I I mean that's totally fine. I just give them the option between the two. And um, I like like I said, I I push more for the recurring one and um talk more about the pros on it. Like, um, when I when I'm describing a payment plan for him, I talk about, oh yeah, and you're gonna get support for the 12 months, you're gonna have this all included, or if you do the one-off, you only get support for one month unless you go on to a technical support plan, which then is a monthly payment after that. Um, but the nice thing about it is as we're working on your website, if let's say your team gets held up a little bit and um you have to are we have some pages that aren't necessarily done and we want to get new content on there, you can take the time and just know that we'll be ready for you as soon as that's happening because you're already on that technical support plan, we can get that stuff set up for you, no problem. Um, things like that, the where it just helps kind of like smooth out the or gives more pros for the payment plan versus just not doing it. Um, because it's in theory, it's not that much more, and it's split up even further. And for some reason, um people are more likely, I I don't I don't know why, but for some reason, people are more likely to want to split it up over it because like even though they're paying more, they are still they're getting it feels less to them because it's uh it's overall up front, it's not as much right away.

SPEAKER_00 19:06

Yeah, so that's why Amazon's got the the buy now pay later or after the pay in four easy payments, and you're like, this thing is only 120 bucks, like I really don't need to do four payments, you know. But like people, I'm sure it's attractive for people, right? Because like I can just pay 30 bucks now and get that $120 or the $1,500 thing. I only have to pay $300 now, whatever it is, right? So um, yeah, I can see that that's for something about that psychology, just makes it easier for people to spend more than they might have otherwise, right? I mean, yeah. Um I was gonna ask you about, as I was thinking about this too, I was gonna ask you about like, you know, marketing services that you might offer after a web design. I'll just give you kind of a quick example, and I'm kind of curious how this plays out in this model. So we did a website for a company that's got a lot of products, they sell them through distributors, so it's not actually an e-commerce site, but they're trying to push their products in the highlights so that contractors and stuff are requesting their products and the end customer. And so, like, we did their website. I don't even remember what the project was. Let's say it was $12,000, $15,000 to do this website. And then they were really wanting us to do some ongoing marketing for them, which is turning out to be in the $2,000, $1,800, $2,000 a month range. So for them, we were able to get them, we weren't doing the payment plan, so we were able to get them to pay, you know, $12,000, $15,000 over a few months to do the web project. And now they're going to be paying us, you know, $1,800, $2,000 a month for ongoing marketing services. I'm curious with the payment plan model, um, would you just for a marketing service that they you knew that they wanted, would you just kind of bundle that in with the project cost, or how would you go about that with this kind of payment plan model?

SPEAKER_01 20:51

So something like that. Um, I would if if I knew that they want to do something along the lines of more than just a website, I would put them into more like my signature system. So um we we developed that through like Mavericks and kind of got the whole idea with that. And um that's more a complete like encompassing setup of like everything for them rather than just the website. And we do like their funnels, the landing pages, the SEO, um, any kind of like marketing setup that we would help them with, that's all included with it. And the way we kind of like break that up is like we figure out like one, like okay, they need their website, and this is the first that's what we have to do. Um, we know that we're gonna be doing a social media launch soon, so we're gonna get some landing pages done and ready to go. Um, and it's just we have more of a like a commitment on what all they're gonna need there, and then we just figure out like it's X amount of hours a month for what they get for that signature system. Um, and then it that way it gives them a little more freedom of like what they need. So, like if they have a big promotional thing that's coming up, we can easily like kind of shift gears without being like, Okay, now our timeline's all messed up. We just have to say, Okay, these are. This is what we're going to focus on for this quarter. And then each month we have a monthly check-in to make sure like this is what's coming at, or this is what's going on. This is what's what we need to work on. Um, and it just makes things a little bit easier that way. And we do have um more of a um like a we like a minimum like six month commitment, or if it's a really big project, then your commitment of being on that plan. So that way, like if they say that they're done or whatever after X amount of months, it's still similar to a payment plan with it. We just make it a little more um a little more free-flowing versus the okay, this is what we're getting, and then this is what you get after.

SPEAKER_00 22:35

Okay, so I I hear you saying that the signature system would be like three, four, five thousand dollars a month. We're gonna do your website in month one and two, we're gonna launch a social campaign here, we're gonna add on the digital ads here, here. And so they've got they've got a lot more stuff that they're getting done over the course of that six or twelve months, and they're paying obviously a higher amount for that. And so it still kind of puts it in that payment plan kind of recurring revenue model, right? Yep, yeah.

SPEAKER_01 23:01

So yeah, still that recurring revenue. And then the nice thing about it is like we we base it off like how many hours we spend on it per month. Um, so like I'm not gonna say that the landing pages are gonna be um super there's like we're we're gonna charge like X amount for the landing pages or X amount for the social media posting or anything like that. What we do is just okay, you get these hours with this package. We can spend it on any time over here based on um like the plan and like the actual like roadmap of what we've designed for it. So that that's how we break it up that way. Um it makes life a lot easier doing it that way too. Um, because they just have a little more freedom, and like as everyone knows in business, things tend to move pretty quickly, or we people want to move quickly. Um, and by saying no, sorry, we're locked in for this for um a year, or we're locked into this because we have to get this project done here, um, makes it a little harder for some business owners when they have a big launch that they're needing to push forward. So, so I mean I've had some clients where like we're working on their website, we're about done, but they have a big like webinar that we're um getting ready to launch. So we'll put the website on pause, work on the um the like webinar funnel forum to get that ready to launch so they can do their big push. So it's it really kind of goes back and forth depending on what the client needs first, like, okay, we have our strict deadlines here, which does put a little bit of um a little bit of a stress with the team as far as like things have to be paused and drawn out a little bit over time, but at the same time, like I mean, as long as we're so we're still fitting within those hours and we're good to go. We're not like stretching past that unless the client's painful more and we can bring on more time, more people for it.

SPEAKER_00 24:37

So that those are the main things that we focus on. Love that, love it, love it. I know some agency owners will even do like a credit system where they'll say, like, hey, if you need this landing page launched or you need this social media campaign, like you know, you're on this plan that has X number of credits and they just kind of assign similar to like what you're saying, basically, with the hours, but rather than kind of saying you have 20 hours or 40 hours or whatever, it's like hey, you've got 10 or 20 or 30 credits, these different things take up different credits and then kind of give the flexibility to sort of adjust as needed, which is cool.

SPEAKER_01 25:09

And I can definitely see that being a huge benefit because like I mean, I have had a couple clients be like, well, um, how many hours did this this little project take and things like that? Where if you have say, okay, this this is gonna take X amount of credits or whatever, it's um it's a easier way to tell a client versus than be like, Well, that that project only took like a half an hour, right? Or 20 minutes. Do we how much how much of it are we blocking it down? So you don't have to give as much like detail.

SPEAKER_00 25:38

Yeah, yeah, which I think is nice, you know, and we're not trading the the time for money. So exactly, yeah. Cool. Um, well, Brandon, man, this is just I I'm just you're so inspiring to me. Like, I love how you just take action. You just you just like you're a go-getter, you're an implementer. You it's just been great to see you on this journey. Is there anything else that um you think related to this that we haven't covered that would be helpful in terms of uh people that are considering, like, hey, this could be really helpful for me? Any anything to look out for, anything you'd say?

SPEAKER_01 26:07

Um, the only thing I would say is um the payment plans are great, they're they're good, but one thing you want to be careful of is just like making sure like you're comfortable with it. Because like I know there's some people that aren't necessarily comfortable with like spread splitting it up because like if something cancels or whatever, just make sure you're covered, like make sure you're comfortable with it. Um I I have a a friend of mine that was talking with him the other day, and he had a just did a big like um $40,000 project for him, and they did 50% up front, and then the other 50% was due, um ready to go, and he was done with the project. And it was a um basically he's a tech company, but he was installing some like door system for a client, and that um company that he installed it for was all done, it's all done. The company came back and said, Hey, I don't have the money to pay you. And so we were talking about like ways to like in the future, so you don't run into that. Like um, we talked with like different payment plans, and he said, Well, I don't um I don't want to be a bank to for this kind of stuff. And so, well, I mean, what you could do 50% down and then split up that other 50% with a payment plan. That way, like you you have your costs covered, you don't have to worry about that kind of stuff, but then you just have the whole uh the whole feature of like the extra like reoccurring revenue coming in after the fact. So and he really liked that idea because like one, he's he's not out of the the 50% cost thing, so with a he doesn't have to affront a bunch of money on his side of things, but then the rest of it's just split up over a month and he's getting that re-incurrent revenue after that. So, and then also people aren't can't aren't gonna come back and be like, Hey, sorry, I don't have the other 20,000 to pay you right now. I don't know what to say.

SPEAKER_00 27:47

So, yeah, yeah, that's good, that's good. I I like that kind of uh variation on the take of this. I think you know, there's lots of ways, you know, you like you just like you said, you someone's not paying for a project and you you know want to kind of give them the option to make it over some smaller payments, like at least hopefully you'll get your money that way versus like hoping that they're gonna have that big chunk at the end um or whatever. So, well, this has been great, Brandon. Thank you so much for coming on. It's been awesome to see your journey as a Maverick and just kind of the progress that you've made and the growth that you've had in your business. So uh really appreciate you taking the time. Yeah, thank you for having me. I appreciate it. Hey, thanks for listening. Don't forget to like and subscribe and share this with anyone you think may need to hear it. You never know, you just might change their life.