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Lessons from growing my business: Matthew Layton, Rewind Creative
At a glance
- When you’re a business owner, your company’s growth phase is often a time of learning. You figure out what works – and what doesn’t – and then make important decisions to prepare your business for growth.
- Matthew Layton, Managing Director of marketing agency Rewind Creative, learned some critical lessons during that early period of growth, including how to better manage clients and the business’s own finances.
- He also offers insight on how to evolve without compromising financial stability; the value of getting everyone involved in the business working towards a shared goal; and why prioritising the quality of your product or service is so important.
Be clear about payment terms
“Two critical lessons we learned were about getting payments in on time and enforcing our terms rigorously,” Matthew explains. Early on, Rewind Creative ran into problems with clients delaying payments or not adhering to agreements, which had an impact on cash flow and made it challenging for the business to plan.
To counter this, Matthew implemented more robust processes around agreeing terms with clients. This included requiring formally written documents that would be logged for future reference.
“It allows us to focus on building client relationships rather than constantly chasing late invoices,” he says. “That clarity protects our interests and builds trust with clients. When everyone is on the same page, it sets the stage for a successful partnership and avoids misunderstandings.”
Understand your financial structure
Another mistake in the early months of the business, Matthew says, was around how they managed the money coming in, for example treating VAT payments as regular income.
“That forced us to confront and address structural inefficiencies,” Matthew says. “We embraced the lessons from these challenges and became more structured in our approach.”
For one thing, they started separating VAT payments to ensure they were not including that money as part of their working capital. This helped them to avoid financial setbacks and to maintain a more stable financial position.
“We invested time into understanding how money works in our business and then structured our costs accordingly. This knowledge allowed us to optimise our financial resources, leading to improved profitability and sustainability.”
Under forecast, over plan
Making conservative assumptions when it comes to projecting income and outgoings has helped to keep Rewind Creative financially healthy.
“We learned to underpredict on forecasts and overplan on cash flow,” Matthew explains. “While optimism is essential, realistic projections are crucial to avoid overextending ourselves. Being cautious in our estimates ensures we are prepared for unforeseen challenges.”
Focus on sales growth
“We recognised that continuously pursuing new sales opportunities gave us the freedom to innovate and experiment – it gave us the flexibility to make mistakes without facing enormous risks. This allowed us to evolve and grow without compromising financial stability.
“Focusing on sales also helps secure quality work we feel proud of; enables us to finance bigger and better tools; helps us bring in talented people; and enables us to chase bigger-name clients.”
Rewind Creative also made increasing the amount of contract work a priority: “We were relying too heavily on project work,” Matthew says, “which made cash harder to predict, and salaries and monthly expenses harder to manage.”
Rewind Creative grew turnover 107% across eight months during its growth phase, Matthew says. Of this, around 80% of the income was for contracted and retained work, and 20% came from one-off projects.
Be smart about who you recruit
The Rewind Creative team grew from two people to five during its growth phase. Matthew knew that in the early stages of growing a business every team member plays a critical role – and often needs to wear multiple hats.
“We quickly realised the value of bringing in curious and versatile individuals,” he explains. “Curious people who embrace new challenges and eagerly contribute beyond their job descriptions became invaluable to our company’s success.”
Communicate your business’s values
As the company grew, Matthew recognised it was important that all team members were pulling in the same direction.
“Every business, whether it’s one person or a larger organisation, should have a ‘north star’ – a clear vision and direction,” he says. “In a competitive landscape, the ability to communicate the value and quality of your offerings is critical, especially when new-business acquisition becomes a challenge. It’s essential to stand out by effectively conveying your unique advantages.”
He invested time in communicating Rewind Creative’s values, purpose and mission throughout the organisation, so everyone understood the vision and was able to work together and unite behind a shared goal.
Be ready to adapt and pivot
During its growth stage, Rewind Creative got into a comfortable position with a strong client roster, Matthew says. But there was growing talk about the rising cost of living.
This pushed some clients to reduce their activity with the agency, meaning it had to reposition. By this point, Rewind Creative was able to act quickly, plan properly and stress-test the impacts of its decisions.
“An example was when I decided to add paid advertising as a service,” says Matthew. “Forecasting business income without the service, we would have broken even. Instead, we ended the year with 18.5% profit, and paid advertising made up 40% of our revenue.
“Also, in a previous role I saw it was common for agencies on monthly retainers to produce work that didn’t drive a tangible impact – for example continuing with a social media campaign that is no longer working. Something I now live by is that every piece of work should aim to drive impact.”
Choose the right clients
One common mistake businesses make is taking on every project that comes their way, without considering the potential risks and downsides – something Rewind Creative did in the early days.
“It’s important to carefully evaluate each project and decide whether it’s worth pursuing.
Some projects may seem great on the surface, but when you get into it, the time and resources needed can lead to a loss of time and money,” Matthew says. “Knowing which projects to take on and which to pass on can help you maximise profits, minimise risks and keep your team motivated by bringing in work that excites them.”
Never forget quality
Matthew’s advice to other business leaders facing challenges as they grow is to always prioritise the quality of your product or service, regardless of external factors and circumstances.
“Delivering excellence to clients remains crucial for building a strong reputation and retaining a loyal customer base,” he says.
How we can help
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SJP Approved 26/07/2023
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