AI Agency Competition: Why Sub-$3M Agencies Are at Risk

**Jordan Ross** (0:00)
Welcome to How to Build an 8 Figure Agency. My name is Jordan Ross, and I'm your host. And over the course of this journey, we're going to be interviewing 8 Figure Agency owners and going through the systems that I've seen work and we've implemented into our clients' businesses that have helped our clients add a half a billion dollars in annual recurring revenue over the last handful of years. I myself have already hit the 8 figures in annual recurring revenue, and when I got there, I wasn't happy. I was stressed, I was dissatisfied, and I didn't like the people I was working with. So I clicked the restart button and went from 12 million in annual portfolio revenue back down to the mid 7 figure level to a climb back again. And on this journey, I'm going to be documenting my process on how I'm getting backstage figures and bringing you expert industry leaders who will tell you everything they did to get there as well. Thanks for tuning in and enjoy the episode.
If you're doing $3 million or less, have been in business for more than five years, and have at least employees, whole thought, you are in trouble. I'm not fucking playing around. This is not a joke. This is not an over exaggeration. This is going to be a short conversation that if this is you, you need to listen the fuck up because what I've been saying since 2025 is happening and I got another use case and anecdote yesterday. And I want to tell you two stories of two independent experiences into one bigger thing. One is new entrants into the agency space, who you're competing against. And that one, I spoke to one of them yesterday and I blown the fuck away. And the other is the incumbents, you guys. So without further ado, this will be less than six minutes. I have six minutes between now and when I'm done, this will be a short convo. Thanks for listening. So for those of you that don't know me, my name is Jordan Ross, I'm the CEO of How to Scale an 8 Figure Agency. And today we're doing a solo conversation where I speak to thousands of agency owners a year. In 2025, we're the world's first AI development consulting firm for agencies. So I've just been on top of this trend since last year. Before it, but anywho. Okay, so two stories. Story number one. We had a prospect for Adath. She's been in business for 16 years, and she's doing just about a million. And her margins aren't good. She doesn't have a lot of discretionary profit to invest into fixing things. When we pull the transcript in her own words, she loads her business. Her business has given her the ability to live her life in the way she wants to, but she's a prisoner to her business. She doesn't have the capital to invest like 5,500 a month. It's too big of an investment. And she doesn't have the ability to actually grow this thing because she's managing the biggest accounts. Her team's not adopting AI in the way she wants to. She can't build it fast enough. Like she doesn't have the time. There's spire, she can't be pulled in. She is what we have been solving for years. She's in ABC prison.
Now, historically, when ADEF solved this problem, it's like in 2024 and before, SOPs, Process Mapping, where's the waste? Where can we find profit? And then AI comes around and we just have a new tool editor supposed to make solving this problem easier.
Now, that's story number one. Anecdote, quick anecdote number one. Some of you might feel that. And if you feel that, you need to listen up because this is like important story number two.
I have a friend, he just exited his second SaaS company. Now, the SaaS company didn't sell, but his equity is 80% invested. So he's like, they're going to be selling to private equity soon for nine figures, multi nine figures. So, and he already had enough money to be like retired going into this business. So he's about to have his second big frickin win. His SaaS company services a small industry like the TAM is maybe this is actually interesting. The TAM is like definitely many thousands, many tens of thousands, but it's a small niche. It's like, if I gave you 100 guesses of the industry, his SaaS company service, you would never guess it. You would not guess him 100
So this guy's absolute baller. He just leaves his company because he's 80% invested. He's like, well, I got my investing. Like, I don't want to do this anymore and I have enough money to live. I want to do what I want to do. And he talks to his friend who runs a marketing agency. He's like, you know, what are you doing? And they start talking. And this guy has, for his first two months, he picks up Claude in the Internet, and he starts to drive traffic and learn SEO. So we had Matt Putra on the podcast. And in eight weeks, Matt went from zero to hero on Geo and Google. Now, what wasn't mentioned that Matt was over publishing on blogs, but this guy also figured out how to do Geo, how to rank on GPT and Claude and LLMs and Reddit and Google. He had a service that he sells that was just now going a little bonkers just because he learned it. Jeff Bezos didn't build Amazon by being the smartest guy in the room. He built it by building systems. In his own words, good intentions don't work, mechanisms do, and that's the whole game. Most angelins are stuck at seven figures because they're running their business on poor, ineffective or non-existent systems. There's no repeatable way to analyze data, to root cause constraints, to build the correct strategic plans, to source hire onboard training, retain, develop, manage talent and clients. Everything is dependent on the founder showing up every single day and willing their business to success. If you want to hit eight figures in annual revenue, you need my 13 systems.