Paul Bellows | [Top Agency Series] How to Niche and Diversify an Agency Business

John Corcoran 10:43

How long did it take you to take the company to recover? Because you’re, you know, I don’t know how big your team is now. But you’ve got a fairly large company now. So I imagine you’re larger than you were then how long did it take you to really get your feet under yourself and figure out your new market and figure out how to sell and get leads? And that sort of thing?

Paul Bellows 11:03

Well, it took, I would say it took us the better part of probably two years, two to three years. And I mean, one of the things that my team has heard me say way too often, I think is you know, I’ve never learned anything worthwhile from success. Everything you learn that comes through failure, everything is really worthwhile is when you get it wrong, and then you get to figure out how to get it right. So we built, we built most of the mature aspects of our company during that two years, the things that were really, drivers of our success got created during that time, the way we manage projects, the way we market and sell the way we manage customer relationships, you know, the way we train and develop our team, all those things we built during that time, because we had to survive, you know, our, our back was against the wall. And, you know, there’s, we haven’t, we haven’t missed a payroll in 25 years. And I wasn’t about to do that. So, you know, we really just worked hard to do everything we could to keep the ship together.

John Corcoran 12:03

And how long did you have to go without a paycheck?

Paul Bellows 12:06

I was off for about six months. So I’m really happy about the visa. And, and, yeah, it was a pretty, it was a pretty tight six months, I didn’t sleep a lot during that time, you know, I think I was sleeping two hours a night for about half a year. And it was just through sheer willing hustle my business partner, I just somehow clawed our way back into a viable position as a business. And we’ve been thriving since then he actually left the company at the end of 2017. And he really was excited to try just a new chapter, he’s doing some consulting with other digital agencies doing great work out there. And since then, we launched a bit of a new strategy. And it’s sort of part of what we learned was, you know, we need to focus, we need to know how to do something for a customer and add value to a particular kind of customer. We didn’t really want to be just in a generic area where hey, we can do anything for anybody, you know, we really wanted to know certain things. So we doubled down on the public sector and government and said, you know, we think that there’s a real opportunity to help the government with how they deliver services and information online to build real expertise, to build a market focus, and to have strong relationships in that market and a stronger brand in that market. Especially given where we are up here in Canada. You know, we’re far away from a lot of places, and just being known for doing a thing well is proven to be one of the secrets to our more recent successes.

John Corcoran 13:36

Yeah, it’s funny, because I’m looking at you now over the zoom here, and you’ve got kind of a Hawaiian shirt on. You’ve got a bunch of guitars on one wall and you got amps up against the other wall. Something doesn’t scream government worker to me here. So what was it that drew you to it? Why did you feel so passionate about government, especially given from a business perspective, it can be challenged to, it can be a challenge to get that type of work can be a long sales cycle and go Yeah, tend to be frugal.

Paul Bellows 14:04

The sales cycle is brutal, and the budgets are challenging. But what I’ll say, I mean, one thing, you know, you might say, I don’t look like work in government, but you start to meet people who work in government, people who are really in government, and some of the things that are true about them is they live their life for the purpose, you know, most of them, they, they value their life as much as their work, you know, they want working life balance, you know, they want to be parents and or hobbyists or a musician or something. And government is the kind of job that tends to be 40 hours a week, tends to be fairly manageable, and has a lot of stability to it. So a lot of really, really interesting, passionate, socially minded, you know, intelligent people go into government work and some of the best people I know work in government. One of the reasons I would like working for the government is, you know, there are definitely people that get beat up by the bureaucracy and become jaded and become political. And you know that that definitely exists in government, but most of the average people that I work with day to day Are the people that are trying to fix things, trying to work in their communities, trying to improve things for people, you know, cuz you got to remember government is, you know, it’s teachers, it’s nurses, it’s healthcare practitioners, at least in Canada, it usually is, you know, it’s the people who paved your roads and pick up your garbage and the people who mow the lawn in your neighborhood park, you know, that’s who government is. And that’s who works, there’s people who want to invest in the communities and be part of something meaningful. So government work to me is really exciting. Because, you know, I get to make that promise to my team of you know, every day you’re going to come to work, and you’re going to make some small incremental difference in the world right around you, in the people that were your neighbors, who might be your family, people you might ride the bus with. And it’s, it’s important

John Corcoran 15:43

work. What if some of the challenges have been since you decided on that being your market? What are some of the challenges for you, with pursuing that as a market?

Paul Bellows 15:53

But definitely, you know, we don’t sell in the way that that any other organization working in commercial work would sell, you know, so every, every bit of work that comes to us, every, every new, or at least every new client relationship that comes to us comes through a request for proposal, some formal public tendered opportunity, where a consultant has written a massive tome of requirements that someone has worked over a year, and you need to respond to them and explain why you’re the best and price competitively and, and have a high value proposition. And it’s really, really hard to win an RFP, because

John Corcoran 16:28

sounds you know, sounds wonderful. Yeah,

Paul Bellows 16:29

it’s, it’s a grind. But yeah. But it’s also part of what we just accepted is the way that our industry works. And generally, once you pass sort of that, that initial gate of getting through an RFP process and sort of grind, grind it out and kind of prove that you can do the work and prove that you understand the technology, you know, it is a real test of your competence. Once you get onto the other side, you’re now in a working relationship with a group of people where future projects, you know, usually have a vendor record status for some number of years where you can provide support and enhancements and ongoing work. And that’s the stuff that gets really exciting. So, you know, that it’s painful, and it’s a long sales cycle, and it’s a ship that turns slowly, like, there’s not much we can do if we have a down month, there’s not much we can do to light up work quickly. You know, it’s its government, and they, you know, they move at a bit more of a glacial pace, just because they’re, they carry a lot of water concurrently, within government, there’s a Apple has, like five products are selling at any given time, government, even a city will have 800 services they have to maintain all concurrently. So it’s just hard to stretch dinner. Yeah. So yeah, we, you know, we, it’s, there’s the, the challenge to it, and we’re probably less profitable than a lot of other agencies like ours, because there are fewer things we can do to impact profit, you know, quickly when there’s something outside of our world that that changes, the oversight of our control the changes, but but there’s also stability, government always pays their bills, government has a reliable partner government, you know, when they commit to work, we generally see the work gets finished. The work is interesting, it’s challenging, it’s, it’s, it’s something that my team is inspired to work on.

John Corcoran 18:06

Yeah, I wanted to ask you about that. Because, you know, that’s one thing that a lot of the agency leaders that I’ve talked to, in this series, have talked about, you know, some struggle with making sure that their work is purposeful, or there’s a tension sometimes, especially if you have a client coming to you throwing a lot of money your way. Yeah, but you don’t know if you really believe in what they’re doing, you know, that sort of thing? Did you find that your team was more motivated once you drilled down on this market? Or did the team evolve where you started attracting more people that were really motivated by the work that you do and the purpose behind it?

Paul Bellows 18:42

I mean, without a doubt, you know, and, you know, you’re talking in like September 2021, which was supposed to be the end of a pandemic, but isn’t quite in either of our countries. And, you know, it’s been a hard year for all of us who have been locked at home, you know, I have staff who have been at home with children in the house trying to do online learning while they’re trying to work. I have staff who are single people in urban centers living in tiny shoebox condos, and they’ve been trapped in those condos, you know, for way longer than they would have expected to be, you know, I have people who have had family and friends, you know, in real peril, or in in, in, in, in adverse health situations. And it’s also just been a time of a lot of anxiety. And so, you know, how do you keep people motivated, given that time? And how do you keep good people on the job during that time, but I mean, work that’s worth doing has been really key to our stability over the last year and a half. And I think the fact that we’ve kind of come up with we lost a couple of people this summer, in senior positions. I think we’re just exhausted and need to change. But we’ve kept our team holds through this and people continue to show up at work and be energized by the work and so I don’t know that a paycheck I just I don’t know. A paycheck at the end of the day is only worth so much. It’s only really I mean, it’s worth a very specific amount actually about not more than that. So the question is, you know, what else are people getting out of bed for? You know, what, why is this work exciting? Why is it energizing if you could do 100 Different things for that same paycheck, and in tech, there’s 100 jobs that any of my people could be offered tomorrow, and they would be great jobs, you know, right. See your purpose that you’re doing? Right. Yeah, yeah.

John Corcoran 20:26

And then talk about, you know, I loved working in government, when I worked in government, it felt very, as you said, very purposeful. One of the challenges though, is that I mean, I remember I was at the White House in 1999 2000, when the y2k was coming through. And we had this, we had these weekly meetings about this software that we were using, that we were worried was going to crash. Unfortunately, it forced them to get rid of this horrible old software and put in some new software, which was a good thing. But you know, it’s difficult to get governments to invest long term and major wholesale change. You know, you said to yourself that kind of thinking about three year cycles. How do you as a technologist, someone who probably can see the future, probably get excited about, I don’t know, cryptocurrencies are excited about blockchain or things like that? How do you try and get your clients to adopt those technologies?

Paul Bellows 21:22

Well, so I think that the first thing is, we never sell technology for technology’s sake, like technology is how not why? And if you don’t get to the why, I mean, I love Simon Sinek, you know, his golden circle, you know, it’s, it’s why, what, and then how, and so, strategically, you know, we start with our why, but we also start with why for our customer. And that almost always comes from user experience, you know, there are almost no people who work in government who haven’t completely lost their way in the bureaucracy that, you know, like I said, you know, that does happen from time to time you find those people that have become jaded, but, but most aren’t. And when you start talking about citizen experience, like, Hey, this is what it’s like for a citizen to access this service. But here’s what it could be like, you know, well, that’s what people get, get out of bed for on the government side, like, Oh, that would be way better for everybody, my constituents would be happier, my, you know, the people I’m accountable to would be happier, we would get fewer complaints that would it would just feel better to if that was the citizen experience that we could deliver. And, and then from there, that’s what becomes the basis for every conversation of well, what do we need to do with technology? How might we do that? What systems would be necessary? So it’s what you lead with? I think that that is what motivates change. So we were brought into a big Canadian city. We brought in some AI technology that essentially lets us build what we call conversational agents, which are robots that will answer the phone and talk to people on the web. And it’s some special Google technology that we work with. And, boy, that’s a hot button, because you’re talking about a unionized organization, where this could be like, is this taking up a person’s estate? Right? Yeah, yeah, we have issues of like, like equity and like biasing this tech, you know, like, are we equally serving all people? Because this technology prefers white male voices? Yes, it does, you know, and yes, it does. That’s a problem with technology, it’s not perfect technology? How are you going to overcome that bias? How are you going to work around it? How are you going to count for it, so that we’re not adversely impacting the experience of one group of humans versus another group of humans, and sort of like leaning into sort of societal power imbalances? The government was nervous about that. So it was big, scary technology. But the reason we were successful was we started from that experience, and we said, we can really help people to get more information more quickly. without straining, or already strained budgets, you know, we can use this to automate the things that people shouldn’t be doing, you know, there’s certain things that people shouldn’t be doing here. But we’re gonna make the jobs of the people who are already working for you, or valuable, they’re getting more value they’re gonna do, they’re gonna be less stretched thin, you know, so we really looked at it as a an experience both for the people within the city and then for the for the citizens to say this is better for everyone in our in our client agree that we were able to roll this into this technology to great success and in handle just a lot of, you know, turn to short, like a nine to five service into a 24/7 service. And make sure that it was easier for people to find out how to deal with their garbage and get on a bus and find a rec center, you know, all these things that people needed to do where a human didn’t necessarily need to answer that call. Those answers are probably already on their website. But you know, they were people who were moving to call centers and other things. So those are the kinds of things that when you pull it off, it’s really exciting. But you’ve got to start with experience and with the why, which is we want citizens to have a better experience working with the government.

John Corcoran 24:48

Yeah. So bringing it back to that allows you to overcome the challenges and the concerns and stuff that come up or makes it easier makes it more easy for you to do that. What are some other examples of other solutions you’ve implemented, where you’ve been focusing on improving the experience, you’ve been able to revamp, you know, experience and make it much more accessible for people.

Paul Bellows 25:14

One of my favorites that we did just launched this one last year, it was about an 18 month project. And so Alberta justice, I’m in the province of Alberta, Alberta, Justice administers the court system here, it’s the provincial department. And so in the same way that you know, you would have a State Department of Justice in any US state, we have our Department of Justice here in Alberta. And they challenge us to say, we want to digitize certain aspects of how traffic tickets are dealt with in the community. So, you know, we have large urban centers here in Alberta, we have a lot of small rural centers, and we have centers in between, and when you get a traffic ticket on a highway, or a municipal road, in this province, it’s given to you by the local police department who then register that ticket in a provincial database. And at the time, you know, there was a way you could look up your ticket number, and it would take you to a payment form you could pay online, and that was fine. But if you wanted to dispute a ticket, you had to book a court date, you had to show up in court, you know, a judge or prosecutor had to look at you, you know, that’s it, that’s a huge part of how the justice system works is a judge will make a judgment on you, they see you in person, you know, they they put eyes on you and they, they hear your story, and they make a character judgment, or legal judgment or policy judgment on should give you a reduced ticket. And so this system, you know, we were talking about, like $200 tickets, and someone wants it knocked down by $80, because maybe the signage was inappropriate, or they are rushing to the hospital and believe it’s a just cause for what, why they were speeding, etc. So you need to book an appointment, it would often take six to eight months, just to get your court date because the system was overloaded. You know, you had justices driving from urban centers, to rural centers for one day a week loading their personal car with boxes of files, booking, you know, hotel banquet rooms to sort of set up court for the day, this is a system that was not doing certainly anyone Well, you know, they the government was spending huge amounts of money on it. So the challenge is, you digitize this process. So this is where it gets interesting, because, you know, the actual technology of a payment form is not particularly novel, you know, like the idea that you can pay for something online. And maybe you can even manage a customer service problem online. None of these things are novel. But novel is we’re doing it in the context of we’re changing the culture of the Justice Department, you know, saying, What if a judge didn’t have to look at this person? What if a judge was a prosecutor sitting in an office in a cubicle in a downtown office building, receiving, you know, digital disputes? Yeah, and reviewing them and getting evidence, maybe photographic evidence or written statements of testimony digitally, and then making a judgement there through clicking a button? What if that’s how justice works? Let me tell you, it was a hard journey to ask people to walk on it, because we’re talking about hundreds of years of precedent in color. Yeah. So you know, we did that through, you know, good old fashioned, like, ride alongs with, with with police and looking at the thing happened, and sitting through court sessions, learning about the process, and getting deep into the culture of, you know, why things work the way they did, and understanding with from within their world, you know, developing empathy for how they work. And they started to model different ways of doing things, and that process really helped them to come along for the journey. And by the time we had started designing to build the early prototypes, we were validating them, everyone on that side said, you know, this is actually, this is actually a much better world, we’re gonna we’re gonna save hundreds of millions of dollars a year, just not running all of these, you know, these extra court systems, you know, they were, they were, you know, like I said, booking hotel rooms and driving all over, and people were waiting, and was taking six, eight months for this to happen. Did you know once the system rolls out, everything’s gonna change. And then you always have privacy issues and security issues. So it’s complex work. So you know that that’s why it takes 18 months to build a fairly simple web form, and get it launched. But, you know, the benefit at the end of the day is you drastically changed the entire culture of the Justice Department. Like I should say, we have changed you know, that the evidence and the word changed it. But, you know, ultimately, you made a real difference in society and probably saved you know, I don’t know that I say hundreds of millions but certainly 10s of millions of dollars a year in ongoing costs.

John Corcoran 29:40

That’s great. That’s great. I mean, I practice law for a number of years and I remember you know, getting in the car driving down your building the client the entire time driving down to, to sit in a courtroom, sit there for an hour for your matter, and we called you stand up in front of the judge for 30 seconds to set another date in the future. Back in the car, driving back to the office, you know, a couple hours have blown a ton of money, very inefficient. And you know, in so many ways, I think that if there’s a silver lining to this pandemic, it’s that it’s accelerated that type of digital adoption, it’s going to save a lot of time. Before we run out of time here, I do want to ask about how you started your agency in the mid 90s. Backwards. Yeah, there were very few people doing that. So, you know, and naturally, I mean, you had a natural, you know, background to start a digital agency. That is you, you got a BA in critical theory. I’m joking, of course, like, you know, yeah, yeah, I was an English major. So how did you know? How did that come about? Like, were you just kind of like tinkering around with websites, and you end up starting a web company? How did it come about?

Paul Bellows 30:47

Well, you made the observation when we jumped on the call, because you and I can see each other and everyone else is just listening. So you don’t know that I was only four years old when I started my digital age. But at the time, I was a four year old, professional musician. So I had this dream that I was going to be a musician. I was much older than four, of course, but you know, I was touring, I was working as a musician. It was the early days of the web, I learned to market it to promote myself, I, you know, I built my first website in 1992. And it was actually not even a proper website on the web, it was just sort of an intranet site where I could post some information, you know, via Telnet, on my, on the local university servers. So you know, I just started working as a hobbyist. I’d learned to do the work and at one point, I ended up meeting with my friend, Randy Thompson, who’s now a venture capitalist here in Canada. And he was starting a new business. And he had just through weird luck ended up in the same room as in the mid 90s. Peter Gabriel, his record label, had a multimedia division, and, and they made CD ROMs. And he had ended up in a room with the folks who are the creative team behind Peter Gabriel’s division, some of the business and creative folks. They had just lost their distributor in North America. They were at a film and television gala that Randy had gotten to. He said, Well, that’s funny, because I’m a CD ROM distributor, do you want to give me a try on consignment? And they said, Absolutely. And then he called me the next day and said, quickly, we have to figure out how to be a multimedia distributor. So he knew that I knew how to build websites, he said, We need to e-commerce, you need to build these things. And we really quickly spun up in like, mid 90s. There, you know, this online commerce, which was almost unheard of, we were making CD ROMs, we were doing streaming audio, we were working Wow. Real networks at the time, like the real audio people. They were talking about us bringing in real world catalog and, and we were doing streaming services, we were like, just like pre bubble. You know, like we were doing all the interesting things at that time. And then I can recall, there was a day where the real world had this fantastic new product that came out that was sort of an art book kind of concept called Griffin. And Sabine people might remember, there was an art book series and they sort of digitized it and gamified it and it was really cool. Multimedia kind of art and an interactive experience. And we had like the Oprah show lined up. And I had this call with Barnes and Noble and they were going to stock it North America wide or like we’re finally going to make some money doing this finally going to make some money after all this hustle. And on a Friday I talked to a Barnes and Noble person. He said, Great, call me Monday, we’ll work up the deals. And on Monday, I called her and she said, you know, Barnes and Nobles getting into the CD ROM business, as of this week, sorry, we can’t close a deal. The internet has taken over CD ROMs. That cold ready, is it? I think our business just ended. By the way, I make websites now. I’ll see you later. And I called my brother at that point. And then we started working together. And that’s that was really the birth of Yellow Pencil was sort of all in that like nine to 12 month period where we dove in, we had to solve all these challenging problems. And from there, I got to like streaming media and commerce and then just building websites. And that was really how the whole business started in the mid 90s. So it was luck. And like they say, you know, it’s ready when lightning strikes. Yeah, he’s most of success in business,

John Corcoran 34:18

such a different world back then than it is now. The generations and generations of evolving technology to change policy have been great. Where can people go to learn more about your work? Oh, you know what I missed? I missed my gratitude question. Let me ask you that so yeah, my last question I was asked is you know, big fan of gratitude, big fan of expressing gratitude especially publicly to people that have been important to you in business over the years and continue to to this day. So you know, we always think of our family and friends. That’s great. I love that but you know who’s at you know, a peer or contemporary in your industry. However you want to define who you respect and admire the work that they do.

Paul Bellows 35:00

You know, so my gratitude is gonna, there’s gonna be two answers. One is, you mentioned Carl Smith, and you actually call them Carl shits at one point, which is now my name for him. But he stumbled on it and then corrected himself, it was a perfect one, please don’t edit it out for this moment of the podcast is gonna sound ridiculous. Anyway, Carl Smith is a wonderful caring community oriented leader in our digital industries. And he leaves this group called the Bureau of Digital, and the Bureau of Digital community has been everything for me in business, meeting other peers learning how they think, just through osmosis, picking up lessons. And so Carl is just as a leader in our entire industry bent in such a boon to me, and I know many others. So Carl is definitely somebody that I’m grateful for. And then I’m going to see another one, which is maybe different. But right now we do a lot of work in your large complex content management systems, we built our own platforms, we work with Google Cloud, and, and we’ve created some really cool technology on top of Google Cloud. But in the last few years, we started working with a really interesting company called Box. And you might know them as they are like an enterprise Dropbox, they do content cloud, they do file sharing, they do records management, but they as a company are so customer focused, so rational, so partnership oriented, it is just I am grateful for finding a company that you know, like me is really trying to make a difference. And it’s just so rare that especially in enterprise software, you meet people that are genuinely trying to do some good in the world. And doing it you know, technology first making great products, doing the right thing around security and features and communicating transparently. And working alongside companies like mine, you know, just really saying how can we be successful together? How can we help each other out? You know, how are we going to grow business together, find Customer Success together, and genuinely meaning it, you know, those kinds of conversations don’t happen often. So I had a meeting with some of their senior leaders this morning. And it was just feeling grateful you caught me on a day where I’m feeling grateful for, and just a company that I genuinely enjoy working with. And it’s just so rare to see a company that can grow to their size, you know, sort of be in the Silicon Valley world can can be an enterprise software sales world. And like in government, you know, some people get jaded, but you know, really, really haven’t found those people at Box. So a company with great culture, you know, any company with that kind of culture I absolutely admire and learn from everyday.

John Corcoran 37:25

Yeah, Paul, this has been great. Where can people go to learn more about you and connect with you?

Paul Bellows 37:30

Well, I mean, will tell you very little about my company, because, you know, shoemakers, children. But if you listen to The 311 Podcast, that’s the podcast I started, where I talked to people who are in government doing the really hard work, you know, they’re the heroes of that journey. And so that’s a great place to learn what I care about and hear me talk more. Yeah, if that’s something you would like to do.

John Corcoran 37:53

And even though you denigrate your website, call this choose kind of thing. I actually think it’s a stunning website. It’s really just it really stands out. That was one thing that I had a great impression of. So go check it out. If for no other reason, just to see, you know, really interesting dynamic design. But Paul, pleasure talking to you. Thanks so much.

Paul Bellows 38:13

John, thanks so much for letting me be a guest. It was great to meet you and learn a little bit more about your journey to think like.

Outro 38:18

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