How to scale a service business to $ 10 million annual recurring revenue in just 4 years - Interview
Russ Perry is the founder of Design Pickle, a flat rate design service, that he started in 2015. In a nutshell, Design Pickle offers unlimited designs for a monthly rate.
After running 2 design agencies and freelancing, Russ saw the limitations and constraints that a classic agency brought. Following those experiences, he decided to come up with a new business model that would allow him to productize his services and make his business much more scalable.
What's special about Design Pickle?
Design Pickle is the world’s #1 graphic design platform that provides unlimited, high-quality design work for thousands of businesses for a flat-rate. Design Pickle was born from the idea that all businesses need access to seamless, reliable and professional graphic design on a consistent basis.
With a scalable pricing model based on each user’s needs and unlimited project requests, the platform can be used as a stand-alone source of design work or as a supporting tool for graphic designers.
Why did you start Design Pickle?
I actually started Design Pickle by accident — While I was running my consulting business, I needed a way for my clients to get design work done while I traveling to other offices. I created the bones of Design Pickle so my clients could request new designs. The requests would get fulfilled by a remote team and delivered to me initially, then I would review and send them to my clients in the evening.
I knew I wanted to start another business, and when I realized that this process worked, Design Pickle took off. I finally saw that my clients were really happy with an on-demand design service that was reliable and didn’t need my interference.
I had been studying the SaaS (Software as a Service) business model through different books and podcasts, and asked myself, “I wonder if I could deliver this service at one price every month where clients could subscribe and get as much as they need.” On top of that, I really needed to pay my bills! I had a family to take care of — I’m married with three children. So it was important that I was building something beyond just consulting.
What's different and better in the business model of Design Pickle versus the agency business model you previously had?
The difference between Design Pickle and the agency business model, especially the one that I had, is how much more reliable and consistent the former is for everyone involved.
At the agency level, you’re erratically trying to deliver for clients — there’s a ton of different deliverables and a varying mix of clients and involvement. On the client’s side, the experience is also varied. Every agency is different and has various levels of capabilities and competencies. There’s a ton riding on who you hire.
With Design Pickle, the experience is standardized across every user. We work the same way no matter if you’re a small “mom and pop” business or a Fortune 500 organization — from signing up and onboarding to billing and receiving design work.
Image by Taylor Henning
How did you start it? Did you have any previous experience as an entrepreneur?
I had eight and a half years of entrepreneurial experience. I ran two branding agencies; one I ran solo for three years, then with a partner in Argentina. So I really learned how to work with clients and deliver creativity with a remote design team.
How did you validate your idea?
Back when I was consulting, I started calling this design request system Design Pickle internally. The positive feedback I was receiving from this process made me realize, “aha, this is something that I should be doing.”
How did you finance your project?
I financed my project through all of my consulting revenue, so I took the money that I was making, paid my bills, paid myself a little bit, and then invested that all back into hiring, growth, and marketing.
How did you market and promote Design Pickle when you were launching?
When I launched design pickle, it was all word of mouth marketing. I emailed every contact I ever had and did a ton of guest blogging. I also coordinated a big launch where all my guest blog posts went live at the same time. And then within the first 90 days, I attended Infusionsoft’s marketing conference (which no longer exists) and that's when I first dressed up as the pickle.
As the legend goes, I was unable to get a booth and so I negotiated with their team to let me hand out pickles at the conference. But I didn't just hand out pickles. I wore a pickle costume that I found on Amazon, and pushed an old ice cream cart I had rebranded to carry all of the pickles in.
How long did it take you to start getting the first results and see you could create a viable business?
We knew that we were a viable business from day one. I had 26 clients, which felt amazing. Design Pickle was profitable in its first month and we just kept growing from there. Knowing that this was working from the get-go was a lot of fuel for me to continue.
What are the main ways in which you are able to monetize Design Pickle?
Most agencies and creatives charge either by deliverable or by the hour. But with Design Pickle’s subscription model, the service is one flat rate — So you’re basically renting part of your designer’s day.
What has been Design Pickle revenue progression?
A lot of people doubted Design Pickle at first — in fact, I got rejected from 500 Startups because the investors thought that this business model simply wasn’t scalable. All the numbers were there, but people just couldn’t wrap their heads around the idea.
But by our fourth year in 2018, we had served more than 10,000 clients and was on track to hit $10 million in ARR. In 2019, we achieved #345 on the Inc. 500 list with 1,329% growth.
What do you like most about being an entrepreneur?
What I love most about being an entrepreneur is simply the ability to solve problems and to create. I’m also able to travel and see the world, since Design Pickle has team members in seven countries.
As an entrepreneur, I also love seeing the vision of our company come to life. Design Pickle’s vision is to change lives through creativity, and not only are we changing our customers’ lives with our service, but we’re providing amazing jobs here in the states and around the globe.
What has been your biggest challenge/failure as an entrepreneur?
The biggest challenge as an entrepreneur is knowing the balance between “growth and go” and when to slow down to improve what you have. I think there's always this internal drive to do more and to build more and to create more. And that for me is hard to balance, to say, “okay, let's stop doing that and let's just improve what we have.”
What are your business goals for this coming year?
This next year is huge for us — we're revamping the entire Design Pickle experience for clients, including the user interface and how clients interact with it. We'll also be adding more services beyond graphic design and creative illustrations — including the launch of our custom template and stock vector library called Fresh Stock. Our goal is to launch 30,000 plus assets with templates and illustrations all created by our custom illustration team, which is going to be huge.
How can an aspiring entrepreneur start building a business now? What would be a good business type to start as a beginner?
If you're starting a business now, I would recommend you start something that is profitable from day one. Good types of businesses to start are, in my very biased opinion, better ways to deliver services.
And there are so many services out there, from real estate to cars, where people are delivering a service in a very old fashioned model. If you can come up with a new way to deliver that service, people are going to understand the value you're giving because it's a service they recognize. This is a great way to disrupt either with technology, pricing, or both — and it will be much easier to sell.
What is one habit of yours that makes you more productive as an entrepreneur?
One habit that makes me more productive as an entrepreneur has to be a meditation and journaling. I do both every day. It allows me to stay focused and achieve peace mentally so I can keep going despite the chaos.
What's your favourite quote?
“Don’t be in the business of playing it safe. Be in the business of creating possibilities for greatness.”
― Robert Iger,
Any good book to recommend to an aspiring entrepreneur?
I definitely recommend Zero to One by Peter Thiel, one of the founders of PayPal. The book offers a consise, witty, and practical approach to create value in the world as an entrepreneur. Thiel demonstrates how unconventional thinking is crucial for success — and how truly innovative businesses have a competitive advantage.
Learn more about Design Pickle at www.designpickle.com
Listen to another interesting interview of Russ Perry from Side Hustle Nation podcast.
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