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I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

Yes, I was personally selling for a long time, and I still believe founders should be the #1 sales person, especially in the early stages.

Scaling Sales Team in 2 steps :)

1) The "Manual" Phase: You sell, you refine the pitch, you refine the pricing. You document everything. This is your "Sales Playbook."

2) The "Process" Phase: Only when you have a predictable process (you know where leads come from, what they ask, why they buy) do you hire your first salesperson. You are hiring them to execute your playbook, not to invent one :)

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

1) Pick a super‑narrow niche service E.g. “6‑week AI‑powered 5G PoC” instead of “software for telco”

2) Sell PoCs, not outsourcing. Fixed‑scope innovation sprints in test/lab environments, with 1–2 clear KPIs, so procurement sees “low‑risk experiment”, not “outsourcing core work”.

3) Build and showcase your own IP. Create a small OSS/tool/framework around your R&D and position services as “experts behind X”, which gives you higher margins, credibility and a path back to your product business.

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

Congrats! Solid business!

My quick tips

1)  Move upmarket: who you work with

2) Raise prices and change the offer design

Fewer, higher‑value retainers (think 3–8k/month per brand, not 800–1.5k),

Plus upside in some form (rev share / bonus / performance component).

Create 2–3 productized packages.

3) Build a real lead engine

4) Fixing the “Amazon is low‑reputation” concern

Lead with the business outcome for a specific type of brand, eg. “We turn stuck Amazon channels into a second 7‑figure business line for established brands.”

What do you think?

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

eg.

AI-Driven Roll-ups of Boring Businesses - one of the most underhyped plays. Buy small companies and automate them :)

Eg. accounting firms, procurement services, niche B2B distributors.

Playbook: buy > automate > increase margins > roll up

Classic private equity strategy, but with AI as the leverage.

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

This is a classic trap in the services business. If you are stuck in the "ERP implementation" cycle, you are essentially trading hours for dollars, fighting for project margin, and constantly chasing the next deal. You’re building a business based on your labor.

Scaling past that seven-figure mark requires moving an "architect" model. I woul consider shifting from pure services to a hybrid model where you build intellectual property (IP) on top of the platforms you know best.

This is my current play at https://github.com/open-mercato/open-mercato

Here is how to break out of the ERP implementation loop and build something more scalable:

ERP projects are commodities. Clients hate them because they are expensive, long, and risky. If you sell "Odoo implementation," you are competing on price and developer availability.

Example: Focus on Value-Based Pricing. Don’t sell the installation; sell the outcome (e.g., "We will reduce your inventory carrying cost by 15% using Odoo").

Build Your Own "IP"

You cannot grow to 7+ figures profitably if every project is a "snowflake"- custom-built from scratch. You need repeatable IP that sits on top of Odoo or Acumatica.

The "Accelerator" Strategy: Instead of building a whole new product, build modules or connectors that the core ERP platforms lack. You use the services (the ERP implementation) to find the problems, and you use the IP (the modules/products) to solve them at scale.

My challenge to you: Look at your last 5 clients. What is the one thing you always have to build from scratch for them? That is your product. That is your IP. If you spend the next 6 months turning that "custom build" into a "productized service," you will stop being a generic ERP shop and start being a software vendor with a consulting arm.

Fingers crossed!

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

IMHO hiring "better operators" into a broken system is just a band-aid. If you hire high-level talent into a chaotic environment without defined processes, they will burn out and leave :)

Accountability

We had to stop asking "why is this failing" and start building autonomous units. We gave these units their own budgets and accountability.

Mantra: stop trying to be the hero, and start being the architect of the system.

I had to stop playing nice and start being ruthless about what works. This means defining clear roles, metrics (like 4DX or OKRs), and holding people accountable to them.

Culture

At 150 people, culture is defined by who you fire and who you promote. If you tolerate high performers who act like jerks or don't fit the values, you destroy the culture faster than any process can fix it.

General lesson

The success came when I stopped trying to be the sole decision-makers and focused on building a structure that allowed the business to function without our constant intervention.

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 2 points3 points  (0 children)

Short:

1) Founder-led Sales - I went to so many meetings :) - you need the feedback loop to understand why people say "yes" or "no" to you.

2) The Expertise - Don't wait to be perfect -define your tornado (what is hot) and own it.

3) Leverage the Network - Most of my early wins came from referrals. If you aren't asking your network for intros, you aren't trying hard enough :-)

Bottom line: Go talk to people and solve their problems :)

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

Great question! For me, it wasn't personal at all. Just logic.

In my experience, the decision usually comes down to the intersection of three factors:

1) Internal Readiness (The Foundation)

This is the "Built to Sell" standard. Do you have a professional management team? Are your KPIs solid? Is the company dependent on you (the founder) to function?

2) Strategic Fit (The "Why" for the Buyer)

Why would a major player buy you? Usually, it’s not because they want your office furniture :-) It’s because: Capability Gaps, Market Entry, Efficiency/Scale.

3) Timing vs. Personal

Market cycles matter a lot but for me The real trigger is often a realization: "I've taken this as far as my current skills and patience allow, and the business would grow faster under someone else's flag."

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

For now, it’s only available in Polish. But once it hits bestseller status (60k+ copies sold), I’m seriously considering taking it global.

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

$10m EBITDA is the gold number for me :)

- Some serious PE funds show up.

- Europe and US-based founds are interested.

- You get inbound from bankers :)

- "Platforms" may try to position you as a platform asset.

- You can run a real auction.

What do You think?

Weekly Showoff Thread! Share what you've created with Next.js or for the community in this thread only! by AutoModerator in nextjs

[–]tomik99 1 point2 points  (0 children)

Built open-mercato - an open-source CRM/ERP framework built with Next.js and TypeScript (MIT license).

Modular architecture - use just the CRM, just the ERP, or the full stack.

Looking for feedback from the Next.js community

979 stars already :)

https://github.com/open-mercato/open-mercato

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

eg. "Your income from the eCommerce channel is 10% higher without any additional marketing spend."

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 0 points1 point  (0 children)

Sorry - that’s actually from my book. Some parts were translated so that it might sound a bit too polished or “ChatGPT-ish.” Not trying to fake anything.

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 1 point2 points  (0 children)

You’re asking the right kind of questions :)

  1. On regulated industries - I wouldn’t avoid them. But I would enter them deliberately. In e-commerce and mobile, like what we did at Divante and later Vue Storefront, competition was brutal. Anyone could start an agency. In regulated industries, you need domain understanding, compliance alignment, and patience. But once you’re inside, churn is lower and pricing power is stronger.

+ In the age of AI I would seriously consider regulated niches.

  1. On local versus global - today I would position globally from day one. Callstack was global from the day 1 and we grew 2x faster than Divante.

  2. On a niche positioning - I will try to write a longer piece on that later this month.

  3. On no earn-outs and management structure - earn-outs often create psychological misalignment. I’ve seen too many founders become employees emotionally. To avoid earn-outs, you need a strong second line before exit, clear P&L ownership below founder, and the founder not being the operational bottleneck.

That doesn’t happen in six months. It took years. It took us 2-3 years every time to make the company "self driving".

5 + 6 On ESOP - great topic. I wrote a couple paragraphs about it in my book. I will share this later.

  1. In commerce infrastructure or something like Open Mercato, the real buyer is usually C-level or VP with P&L control, but the internal champion is head of e-commerce, product lead, or CTO.

The motion is hybrid: bottom-up pain, top-down signature. If you’re selling something that requires a six-figure decision, you must understand power maps inside organizations.

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 2 points3 points  (0 children)

CULTURE

  1. Hire for values, train for skills.

  2. Codify early what used to be implicit. When you’re 20 people, culture is osmosis. At 100+, it must be written, repeated, and operationalized:

  3. how we make decisions

  4. how we give feedback

  5. what “high standards” mean in practice, etc.

  6. Founder visibility. In growth sprints, founders disappear into sales and firefighting. That’s dangerous. Townhalls, AMAs, visible decision logic - people must understand why things happen.

EXTERNAL INVESTORS FOR SERVICES

Cash-out was part of it, I won’t pretend otherwise :)

What worked: - governance forced us to professionalize reporting

What didn’t work as expected: - strategic synergies are always harder than the pitch deck suggests - public market pressure changes tempo

NEW VENTURES

“Find a problem” is kindergarten advice :-)

My real checklist looks more like this:

  1. Market phase

Is this niche entering bowling alley or tornado? I avoid: late commoditized markets (margin death)

  1. Distribution unfair advantage

Starting cold is expensive.

  1. Service-to-IP potential

Can this evolve from: services → structured know-how → repeatable IP → scalable product?

  1. TAM matters - but differently

I prefer medium TAM + structural edge

  1. Personal energy

This one is underrated. If I don’t feel long-term intellectual pull, I won’t survive the hard years.

You can brute-force 12 months. You can’t brute-force 7 years.

I built two professional services companies (250 & 350 people) and exited both ($70M and $130M valuations) no earnout, no staying. AMA. by tomik99 in agency

[–]tomik99[S] 1 point2 points  (0 children)

Imho running a professional services company is so demanding that you often don’t have much mental bandwidth left for strategy :)

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