She Already Had a $2 Million Agency. She Niched Anyway.

Full transcript of Josh Nelson’s interview with Pam Mashburn. Lightly edited for readability.

Josh Nelson: All right. Hello, and welcome to another episode of the Seven Figure Agency podcast, where we're interviewing highly successful digital marketing agency owners from across the country. I'm really excited today to be joined by Pam Mashburn by Explore HVAC, Explore Marketing. She's grown a seven-figure and growing agency. Pam, thanks so much for being here today.

Pam Mashburn: Hey, thanks for having me. I have to say, this has been my dream to be on your podcast. I've watched all of them, and before I joined- Awesome… Seven Figure Agency, I really studied everybody that was on it, so wow.

Josh Nelson: I love to hear that. And, and now, like, you get to inspire the other agency owners that are on this track. So congratulations on your success, and thanks for taking the time to do this. Just kinda tell us a little bit about the lay of the land. Like, what does it look like in the business today? How many clients? How much recurring revenue? What's, what's the lay of the land?

Pam Mashburn: Yeah. So we've got 28 clients. We're at 110 monthly recov- monthly, or MRR, monthly recurring revenue. We have 23 people working in the business full time. Wow. So yeah.

Josh Nelson: Okay. All right. So good margin per client in terms of the number of clients and the monthly recurring revenue. A large team. I know that the HVAC piece isn't the only thing that you do. Right. Talk, talk to us about like the other divisions and how that plays into it.

Pam Mashburn: Right. So we started the business 20 years ago, and we have basically three pillars of the business. So we have the publication side, which is about a quarter of the business. We have a generalist agency, and then we also have the HVAC man- in, HVAC niche. And so it's interesting 'cause we started the publications in around 2019, kinda dabble as an offshoot of some digital marketing. And so we just started learning about it, and we were like, "Oh, we could offer this as an upsell to our publications clients." And thank goodness we did, 'cause then 2020 hit and a lot of, you know, a couple of our publications shut down, and it was just… We were worried the business was gonna go under. But fortunately, digital took off, and so our generalist agency took off, and, that was, I mean, it was really a blessing. And God has truly blessed this business. But what we realized is, and this, we are, we're in Montgomery, Alabama. It's a small city, about 200,000 people, and we knew that we wanted to grow bigger than that. So we were around two million. We're at about four million now agency, and, we knew that we needed to grow outside of our area, and we were also getting tired of learning about every different industry. And so that's, so I started doing some research, found Seven Figure, started watching all your webinars and your podcasts and learning about that, and really started getting jazzed about it.

Josh Nelson: So cool. So you've got a $4 million per year enterprise, and you'd already had a multiple seven-figure business, but you decided to shift to niche focused. Talk to us about like why. Like, what were some of the reasons you wanted to go niche and how that's impacted your ability to continue to grow?

Pam Mashburn: Yeah. I think the biggest reason was what I just said, was just going outside of our area. 'Cause now we have clients all over the United States, right? So we've got so much more potential to earn more, and I think that there was just a fatigue. There was just a fatigue of, you know, we've got the landscape business. We've got the med spa. We've got doctors. We've got all these different people, and it was just exhausting for our staff to kinda figure out what would move the needle for each one. Whereas now- Mm-hmm… We get so excited 'cause we're like, "Ooh, HVAC. Well, if we do this, and we can make this happen for another client." We're able to kind of truly become the authority in that space. And to be honest, you know, we had like a credit union, and this was kind of our first aha moment about getting into a niche. We had a credit union that we'd had for years, and they said, "Oh, we're gonna use this boutique agency that just helps credit unions." And then we heard another client say that, and we said, "You know what? This is gonna be the way of the future, and so we need to adapt and change, too." Amazing.

Josh Nelson: So, so it was to simplify. It was to streamline. It was to really be able to put your laser pointers on it. And from when you decided, all right, we're gonna focus on our niche, HVAC, to now over 110K in that one space, how much time had elapsed? And kinda talk to us a little bit about that journey. Yeah.

Pam Mashburn: It was pro- it was about two and a half years ago that we made the decision, and I kind of took the team kicking and screaming into it. And I don't know if you remember this, Josh, but like I came with one person, and then I brought my whole leadership team to the conference because I needed them to buy in to what we're doing, 'cause the niche stuff is a lot more work. You know, we're used to selling because based on relationships and just being known in the community and seeing people at the grocery store. And now we still have those relationships, but people are looking at something bigger. They're looking at results. Mm-hmm.

Josh Nelson: You know, I have an engineering background.

Pam Mashburn: I used to work in manufacturing, so I love data. I love kind of looking at an equation and saying, "If we do this should happen." Like, I love strategizing that way. But our branded kind of generalist clients, they didn't care about that. But our HVAC clients, they really care about it. And so it took us a couple years to really dial it in and then also to get everybody on my team to become authoritative when they're doing it and feeling confident in delivering results.

Josh Nelson: So- Mm. Yeah. Love that. So you made that, made that pivot. Obviously you're, you're thriving. I think you're just like about to even go to the next level even quicker. Talk to us about why HVAC, 'cause that's something people struggle with, especially in a case like yours where you've already got all these verticals where you have success, and, you know, it's like, okay, it would be nice to be in one vertical, but how do you choose the right one? And, and so like what guided you towards HVAC, and what kinda what was your decision criteria for that?

Pam Mashburn: Yeah, that's interesting. W- so we looked at two different niches. One was med spas because most of the people in my office are women, and since we started- Mm… We've added a few men, but it was- Okay… Mostly women, so we were like, "Oh, we know a lot about that. We'll do that." And then w- but we also had a couple of HVAC clients. And so not as sexy as med spa, right? Right. But what we decided was the med spa industry was really fickle, and I applaud the people that are in that niche Because it's a fickle group, and they're a little bit more needy, and you're dealing with doctors. And so it was just, we decided that clientele was gonna be harder. And so, but what we did love about HVAC is we liked the guys that run those businesses. We understand the nitty-gritty of what they're doing every day, and then we also knew that we could get results. And that was the- Mm-hmm… That was, that was really truly the real trigger, was how do we get results, and can we do it? You know, they already recognize that they need advertising, whereas the med spas, they didn't always recognize that they needed that. The HVAC guys- Mm-hmm… They know if I wanna grow, I've got to invest in marketing.

Josh Nelson: So it sounded like you were looking for where you could have a big impact, where you've already got some experience, where you've already got some wins, and that was kinda like the let's go down this track. How many, like, how many HVAC clients did you have, and then what was the approach to go out and, and grow that like you have?

Pam Mashburn: So we had two. We had two. Two. But we real- I enjoyed working with them. So, okay, so let me just back up. We kinda did things in an, a little opposite from what we talk about with Seven Figure Agency. You know, we have the different tiers at the different, you know, MRR that you're at. Yeah. And I already had a sales team, so I was able to, like… So our sales team was doing different things. We brought somebody on to really do the cold outreach, and we got a couple of clients through cold outreach. But then I had another salesperson that made a JV connection. And so actually- Mm-hmm… That's really how we've grown the most is just the leads from that. So- So good… We're actually starting to do a little bit more with our cold outreach because we don't wanna have all of our leads coming from one source. But- Mm-hmm… We really enjoy working with this coaching group, and we've gotten some really great clients from it. But that's really what propelled the growth.

Josh Nelson: So good. So you had this sales team, and you're like, "Okay, let's, let's go, let's go from two to whatever the next level is." Yeah. And there's a lot of ways to grow. In Seven Figure Agency, we talk about podcasts and webinars and Facebook ads and Google ads and trade shows and events and joint ventures. It sounds like you probably did a mix of that, but what really worked is you landed on one great strategic relationship that started to plug you in to these clients that helped you grow the company.

Pam Mashburn: Yeah. And yeah, that was, that was really the key. And I think you even say you're only one JV away from, you know, a million dollar or Seven Figure Agency, and so- That's right… That was really truth for us.

Josh Nelson: So good. And so, y- you know, if you don't mind, talk to us a little bit about how that relationship was formed. Sounded like you had a salesperson that connected. Was it a win-win? Was it some type of rev share? 'Cause a lot of people are like, "Oh, I love the idea of the JV," but, like, obviously you were already very successful in a very established business, so that gives you a, an advantage in those types of conversations. But just kinda talk to us about, if you can, like, on a high level, what the, what the structure of that looks like.

Pam Mashburn: Yeah. So it's pretty easy. So he, this coaching group, he is from our town of Montgomery. And- Mm-hmm… It was just kind of a God thing, actually. So my sales gal, Christina, who was at the conference the last time we were there, she reached out to him because he had a local HVAC company. And then they got to talking, and then they saw each other out at a restaurant. And he's just such a nice guy. And so we met with him and his trainers, and they actually were already recommending a different agency. Mm-hmm. And they were like, "Well, why should we recommend you guys?" Because we were a lot smaller. And it wasn't a Seven Figure Agency that they were recommending. It was somebody else. But-… And I said, "You know what?" I, and I remember in that meeting saying, you know, we talked about all the things we could offer and the things that we do, and I just said, "I unapologetically will tell you that we are better than they are." Mm-hmm. "We're gonna be more responsive. All of our team is in-house. You know, they're all on salary. We're not just, you know, white labeling stuff," although there's nothing wrong with that. But we weren't. And I said, "You know, we will take care of your clients." Because we were… And we treated it like we recognize that they are your clients first, and that we are a part of the puzzle that will make them successful. Mm-hmm. And so we keep a very close relationship with those trainers and coaches within that group, and we let them know how their clients are doing with us as our clients. And it's just been a really nice relationship. There is no revenue share. They don't need any, they, to be honest, they don't need anything from us. They're making plenty of money. And they have made so many great connections for us and have just been a terrific partner. But on the other hand, they make a lot of their revenue based on their clients increasing their sales. Mm-hmm. So it's actually been very symbiotic 'cause if we can help increase the sales, they end up benefiting. So it's been a really good, a really good JV.

Josh Nelson: Love that. So proof again, like, you're, you're just one joint venture away from a seven-figure business, so you have to approach it in the right way. So, you know, in Pam's case, it sounds like you guys created a great relationship. You found the win-win, and it's not always, "Hey, I'm gonna pay you 10% of the recurring revenue." Right. It's not always… Sometimes it's what's the win-win? Well, you wanna see your clients grow, and we can help accomplish that, right? Right. And we're gonna go to bat for them, and we're gonna make sure that happens. And if you deliver on that promise, now you become indispensable to that joint venture partner, and that's just gonna continue to be a win-win for both of you guys as the companies continue to grow.

Pam Mashburn: Right. And, you know, it's interesting 'cause to continue with that JV, one of the things that we realized is that our ideal client that we really like going after is not, they don't have that many of those clients. Like, they have the clients that are under 700,000 in annual revenue, and they need help. And so we actually created, like, a visibility package just for this, these clients because we wanna help them, help them fill a need, right? 'Cause they're not gonna keep sending us leads if we keep saying, "I'm sorry, you're not the right fit." Yeah, you're not, you're not big enough. Right. Right. So, you know, you have to sometimes make some accommodations for that.

Josh Nelson: I love that. So a great example there kinda how you transitioned into HVAC, how you grew. Talk to us a little bit about what you deliver. Like, what is the typical package, and what kinda, what are you doing for these HVAC contractors?

Pam Mashburn: So, okay, again, we're a little bit different. We consider ourselves a full funnel agency, and so we can do it all. Now, our packages don't include it all, but we can do it all. And what- This is the approach we took a long time ago, is we don't want them talking to the billboard guy, because the billboard guy is selling digital, too. We don't want them talking to the ma- So, like, we don't want other people whispering in their ear that they can do a better job, and they see them at the grocery store. So we'll, we talk to them about, "Oh, we can create those ads for you to complement your branding." But we do, we'll, we'll do TV, streaming TV, whatever. But typically our packages are the j- the basic website hosting, website design, Google, PPC, LSA. Let's see, what else? We also do social. We do programmatic advertising, and we'll do emails, and that's kind of standard. We do text messaging. So anything that's gonna bring them results. So we have, like, our foundation package. Then we have our branding and reactivation package, and then we have… Gosh, we don't sell the other one very much, so I can't remember the name of it. But whatever the bigger one is- Mm-hmm… That one has more of, like, streaming TV. It's, it's really f- We've only got one client right now that's big enough to afford that, and it has, like, streaming TV, geofencing, mailers, and that kind of stuff.

Josh Nelson: Okay. So you're trying to come in and say, "Hey, we're gonna be your full digital marketing or marketing partner- Yes… And it's not just website SEO," even though that's kinda like the fundamental that most people are buying.

Pam Mashburn: You've got bigger- No, well, we do website SEO, too.

Josh Nelson: Yeah. Yeah.

Pam Mashburn: And the local SEO. So we, yeah, we are truly full funnel. And one of the things that we learned the hard way is that if you can't control that whole funnel, then you're not gonna get results. Because everybody, all these clients, they think, "If I just do this one thing, I'm gonna get all the leads I need." And they don't understand that customer journey of I saw you here, then I s- I see you everywhere, and then when I go to Google, I pick you. Yeah. And one of the biggest things we learned was if you take on a client and nobody knows them, and we call it known before needed, if nobody knows them, nobody's gonna pick them. So you've gotta have, make sure that your clients are known in their community, and then Google works. Otherwise, Google doesn't work.

Josh Nelson: I love that. How do you, how do you build that known before needed a- approach? Is there any s- like secret sauce that you're bringing to the table that helps to, especially for those $750,000 a year companies, to get them known before that, you know, like, okay, now they've got a problem and they're gonna choose that company?

Pam Mashburn: Right. So there's a couple of things that we really talk about. One is their Google Business Profile, obviously, 'cause that's- Mm-hmm… Like Google's website for you. And then we've really leaned into the social piece, because that's- Okay… Where everybody is. Everybody's on their phones, right? And we're really leaning into, the video as well. We're doing some AI videos. We're doing, you know, if they send us stuff, we'll, we'll edit it. But most of those smaller guys, they're not gonna do it. We've gotta, I mean, we're having to c- be creative to come up and come up with what their branding is. But the other piece is, you know, we talk to them about, and this is something I learned from some other people in some bigger agency, is we really talk about what is your revenue? Where do you wanna go? And like- Mm-hmm… How many new customers did you bring on last month? You know, 'cause that's really, we're trying to build for those smaller revenue clients, is just building their base. You can't reactivate a database if you don't have a database. So one of the things we always talk about is are you wearing your shirts? Are you wearing your hats? Are you going out? Mm-hmm. What are you sponsoring? And so we talk a lot about what are some things you can do. And I mean, we'll have discussions and people say, "Well, you know, they're building a new Publix grocery store. Should we buy the things on the grocery cart?" You know, and so then we talk about the cost and the time and what it would look like. And so sometimes we're like, "Yeah, spend the money on that," because you've got to be everywhere. So we really see ourselves as partners for their whole marketing campaign. And we'll even, I mean, we have some clients and they show us their whole marketing budget, and we'll go, and it may not be spent with us, but we're like, "Yep, that's a good spend." Or, "Ugh, I know this is, you know, your son's whatever, but is that the best use of money?" And so we really have some honest discussions with them about that.

Josh Nelson: I love that. It sounds like you've kinda elevated yourself beyond just being a digital marketing provider, but to be almost like a marketing consultant. Do you position yourselves as, like, fractional CMOs or anything like that in the mind of the clients that you serve?

Pam Mashburn: W- We haven't, because I don't think they understand what that is. And so- Okay. Yes, but what we talk about is that they can lean into our authority. And so- Mm-hmm… And we talk about the fact that we, that we call ourselves strategists. You know, we've gotta have our monthly strategy meeting. Okay. And actually for our more advanced clients, that meeting used to be, "Here's what we're doing for you. Here's, you know, the clicks and the, and the conversions and that kind of stuff." But now we've moved past that, because now they trust that it's bringing results. And what we talk about is, "I'm seeing a lot of leads on my end. Tell me how your month went. Did you hit your goal? How was service? How was installs?" And we really talk about the business. And so I think they see us as an, as an extension of their business team. And so I don't meet with, I have three clients of the 28, and I know, like, a lot of people like to get, pull themselves as an owner or as we do EOS or as the visionary out of that. But I think- Mm-hmm… It makes me stronger to stay with these three clients, and I really enjoy digging in the weeds with them. And I also enjoy, and this is something all of us do, is talking about what's worked for other clients. Like, "Hey, my guy in Iowa, this is, this is, something we did and it ha- it got a lot of traction. Do you wanna try this?" And they really value that authority of they don't have to throw the spaghetti noodle at the wall and see if it'll stick, because we've tested a lot of that already. And then we have a few clients and they're like, "I wanna test it." Like, "I wanna be, I wanna see if this is working first. I don't wanna have to wait for somebody else." So that's been fun.

Josh Nelson: I think that's gonna be a big part of your retention and why you do as well as you do, because you're not just coming in as like, "Here's our preset package. Here's how much you pay, and we'll meet once a month, look at the results." You're really trying to meet with them on a strategic basis and saying like, "What's the goal? How are we performing against that?" And not like, "More links, more citations," but more like, "What can we do to drive that outcome, whether it's branding centric or something different?" And so I think that- That's really neat. How do you pass that level of thinking down to your account management staff? So you've got your three clients that you still meet with, and I think that gives you a good pulse, and it gives you the ability to train that down, but how have you baked that into the culture of your account management strategy?

Pam Mashburn: Yeah, that's the difficult part, 'cause we didn't have CSS's until maybe a year and a half ago. Yeah. And we had one, and then she left, and so we had to get new ones. And we now have a CSS m- manager, and he's doing an amazing job with training my people. So we've got three CSS's, and I'm actually, I used to be more focused on the marketing and, the sales piece, and now I am digging into the fulfillment and the CSS piece. And so, and the whole reason is because I need to make sure my knowledge gets in their brains, and they think like me. Mm-hmm. And so we go through the dashboards, and I'll say, "This doesn't look good to me. Why do you think that is?" And so we have a lot of sessions where we're just like, I… And I have a rule. I only hire really smart people. Like- Mm… If you're not smart, you probably aren't gonna fit here. Mm-hmm. So I like to hire smart people that are trainable, and so far we- the new group that we have has been really good at that. But my CSS sits in with me, and then I have two salespeople that we're calling strategists, and so they sit in on the monthly strategy meetings with their CSS. But what we're trying to do is get them to the point where the sales and strategist person doesn't have to be there every month. You know, it might be quarterly. I do try to sit on each one. The part that I like is I really like helping them grow their business. So if I, like, one of our clients in Atlanta is talking about growing a second location. So we got on the phone, or on a, on a Zoom, and we talked, and we were like, "Okay, it's really about proximity." He's like, "I'm looking at this space." And I go, "Let me look at it on the map." And then we look, and I go, "You're in an industrial park. Like, that's gonna h- be hard for you to get five-mile famous in the areas you wanna get." Mm-hmm. So I love doing that part. And so just helping those CSS's learn the questions. If we bring in a new CSS, it's gonna take a whi- I mean, we have already accepted the fact that it's gonna take six months to a year to really get them fully trained. But- Yeah… That's the hope. That's the hope. I hope it's scalable. We'll s- I guess we'll see.

Josh Nelson: No, I think, I think it's great, and investing that time is really g- like, your competitive advantage, right? It's your ability to have those strategic conversations even though you're not there, which drives better results for the clients, drives better buy-in, drives better client retention long term. You said, and I, I love getting into, like, operational hiring philosophies and things. Y- you said you only hire smart people. Objectively, like, how do you test for that? How do you, is there any types of, like, IQ testing or thing, or you just, y- you judge mentally?

Pam Mashburn: You're like, "I think this sounds like a smart person." Well, we look for experience, and I will say this. We used to hire people that were inexperienced, and now, and I'll tell you this was, used to be my philosophy. I can do all of your jobs, and I don't have enough time, so I'm going to hire you to take this off my plate. Mm. And now I don't hire that way. Now I say, "I don't, I can do this not very well, but I need somebody that can do it better than me." Mm. Because to bring us to the next level, I need experts, you know? And that's one of the things that makes a marketing agency so attractive to a business owner is they can't be a Google expert and a social media expert and all the different things, right? No. So that's what our group brings. I think the hardest thing, and then I'll get back to your question, I think the hardest thing, though, is to get everybody in your organization to not work in their own little expertise of silo but work together. Mm. Yeah. And that's really what we're, right now it's on my mind, 'cause we're about to do our state of the state, and I, that's one of the things I wanna talk about, is being results focused through collaboration. But getting back to hiring, we like to use the Kolbe test, and then we have hired some people overseas, and that was not something that we did before seven figure. Like, that was something that scared me, made me really nervous. Ooh, I don't know about that. But we met some great people through that, and, one of our staffing agencies that we use really, what's the word? They really go through and find the ones that they think we'll like. Like they know- Mm… The ones that we don't like, and I'm like, "Yep, they're not smart enough." Like, "Nope, they c- they're not grasping this quick enough." And so we really ask a lot of questions during the interview process. Like, if you were setting up an, you know, a Google PPC campaign, tell me all your steps. Mm-hmm. And usually we can figure out pretty quickly if they've done it, if they're good at it, or if they've just read a little bit about it. So, so we ask some hard questions.

Josh Nelson: I love that. I think the philosophy that you said there, and the shift is kind of one of those key shifts from getting to seven figures to getting to multiple seven figures, is I just need someone to help me out and kind of take some stuff off my plate versus I need someone that can actually innovate this process and do it- Yes… Better than I would, and that's how you continue to elevate the company, you know, to multiple seven figures like you have.

Pam Mashburn: Yeah. I mean, I need p- and that's, and that's a great way to say it, because I need people that don't just, are t- people that do tasks. Mm. I need people that look at the process we have and say, "Ooh, I don't think that's gonna work. I think a better way would be this." And you know, now we are, embracing AI. I'm calling us an AI-forward agency, and we're really trying to figure out, because to be competitive, again, I'm always looking at, I'm, I'm not worried about my competitors, but I wanna stay competitive for my clients to say, "Are we offering the best we could offer? Are we offering-" Mm "… The best results that we can give?" And for the money that they have, they're, that they're able to spend, right? And so we're really turning to AI to help us with our productivity pieces so that my people have time to think. Mm. 'Cause I think that is a lost art, is actually thinking, like looking at this- Right… And going, "I don't know. That doesn't seem right," or, "I think we could get better results if…" But when you're just so busy just trying to get your tasks done, you don't have time to think. And, and in the last year, that has been a real struggle for us. Creating that mental space with the amount of clients- Yeah…

Josh Nelson: And the amount of revenue and the amount of tasks, and so you're gonna use AI as a, as a multiplier there to say, "Hey, let's create enough mental space so that you can really be strategic, and you can bring better decisions to the clients that you Sure Exactly. That's exactly… I'm writ- I'm writing that down, multiplier I love that. No, that's fantastic. The other thing I noticed is it sounds like you, I don't know if this is intentional, but you have a lower client-to-CSM ratio than the norm. So it sounds like maybe like 8 to 15 clients per CSM. I don't know if that was intentional or you're kinda growing, you know, or hiring in advance of need.

Pam Mashburn: Yeah. We're gr- we're actually growing that. I'd like- Okay… To have them around 16 to 20.

Josh Nelson: Okay. Nice.

Pam Mashburn: And then it could be more than that if they're a smaller kind of visibility client that doesn't need as much- Mm-hmm… You know, hand-holding. And the visibility kind of package, that smaller package that we're talking about, it's not gonna generate leads. It's about getting them ready to generate leads. And so that's more tasks and creativity, but it's not about the equation of lead generation, which I think- Yeah… Takes more. It's such a dynamic environment out there, and it's such a competitive environment in HVAC that you've got to be on your A-game.

Josh Nelson: Yeah. No doubt. One thing I wanna make sure we talk about, because it's such a common thing where an agency grows to, you know, s- s- high six figures, seven figures in a generalist market, and that was kind of your role. You had the publishing company, and you had a generalist agency. And making the pivot to a niche, you know, talk to us about some of the struggles and kinda how you were able to balance. You know, you can't just turn off the generalist business- Right, right… While you go down this track. Talk to us about how you balanced that and any lessons for other agencies trying to make that pivot.

Pam Mashburn: Yeah, I mean, it's what helped us fund, 'cause, I mean, I'm just gonna admit, I'm, I'm kind of a bougie girl, and I don't, I don't wanna like go into debt. And I will say this, one of the things we did grow slowly. So our business- Yeah… We own our building. We don't have any debt in our business. And we have- Amazing… Funds that act as like a credit line for us. Because I think as a small business, you can't hire people that are worried about getting a paycheck. So we have grown very conservatively and, but the generalist agency is what helped us kind of get our coffers, you know, have that surplus so that we could invest in this. And it was really, actually the seven-figure agent- it's been very humbling. Like, it's been hard, and if you asked anybody on our staff, they would say it is the hardest thing this business has ever done. It's, because it's not based on relationships. It is based on just nitty-gritty getting down there and doing the work. And I did, I knew you were gonna ask this question because I watch all your podcasts, so I got myself prepared to answer this one. And I think here are some things that were big ones for us. You always say that revenue is vanity, profit is sanity. And so we really embrace that. And one of the things that we were doing is, like, for their Google spend, we were charging them for the Google amount and the management fee. And so it was a really hard transition to move our generalist clients and our HVAC to putting their credit card on file. Mm. But it was such a, so freeing for us, for invoicing and management. It really made it so much easier, less complex. So that was one thing that we did, and that was if I hadn't had an amazing integrator and finance person, like, 'cause us salespeople, we were like, "Oh, no, they gonna drop. They gonna drop. We're changing something. They're gonna drop." You know? I mean, like- We were all very fearful… We were freaking out. 'Cause we've always set up our contracts so that they automatically renew. And so- Mm-hmm… We were kinda like, oh, this like signals something changing, and they may decide, oh, I need to rethink this. But you know what? We didn't. And so that was good. So don't worry if you're in that situation. The other thing is with our generalist clients, we always would take anybody, and in fact, we had to make this rule because they were, because these ones that were really small were like taking all the life out of us, and we couldn't use that to grow. And so we had to make this rule, and our salespeople really fought it, which was if a generalist client can't spend $1,000 a month, we're not taking them on. Woo, woo. That was like incendiary. I mean, like, people were ready to like go to fisticuffs over that deal. I don't even know if people say fisticuffs anymore. They were l- they were like, "I can't believe you're restricting my ability to sell." But we had to. Mm-hmm. Because if they weren't a big client for generalists, we didn't want them because we needed to focus on this niche. But I will say in the niche, one of the things we learned was not everybody is a fit. Right. There are some, like we finally started realizing the signals of they're gonna be not easy to work with. They're not. And so we started looking at people more with our core values. And so w- when we look at potential clients and vendors with our core values, it makes it a lot easier to make that decision. But it is hard because you're, because we would see it, and we'd have to tell our salespeople, "No, you're not, we're not taking them." And they're like, "But I worked so hard to get this," and this is their livelihood and their money and all this stuff, and so, but we, we finally got to that point. The third one was y'all have always said in seven figure, set up your packages, run on packages, and what is it? Simple… Wait, what is it?

Josh Nelson: Complex fails, simple scales.

Pam Mashburn: And so we've been trying to get more simple, more simplified. But you know when you're so desperate to hire those clients, you're like, you'll do anything. You'll customize it. You'll break the packages. We had packages set up, then we were like, we need this other little package. And what we realized with that one, like we had our three tiers, right? Where you could kinda grow, and then we had this like one-off package that had a little bit of different things. And what we realized is that package didn't allow anybody to go back into the three package. Mm-hmm. So that was a big learn, and so we've gotten rid of that package. There's a lot of package changing. And then we added the visibility package, so that's our little mini package. But what we did is we set it up so that they could grow into those next tiers. So we finally got smart about that.

Josh Nelson: So it's an escalation path as they, as they're winning with you guys.

Pam Mashburn: Yes, yes. And so that was some big learnings that we had. And then the other one was just taking on CSSs You know, I think salespeople and even myself, you know, we're so protective of these relationships and these people that we've met, and we're afraid somebody's gonna screw up and all of that kind of stuff, and so we didn't. We were very resistant to taking on CSSes. But you've got to have someone. A salesperson and a strategist person is different sometimes than a CSS person who gets- Yeah… Stuff done. And so that has been a big shift for us, and it has been such a healthy thing for our organization.

Josh Nelson: So good. So many great insights and takeaways there. You've mentioned a couple times the sales team. A- and I'd love it if you could talk to us a little bit about, like, what, like, what does the sales role in your organization look like? How have you identified those people? How do you structure that in the organization?

Pam Mashburn: Yeah. So with our publications, most of those sales are reoccurring sales, and so it's a lot of re- just renewals, and a lot of those are kind of incoming sales. And so we have both our s- I have two salespeople right now. I used to have three. One left to take a job that was not so stressful. So we have two that have been with me. One's been with me for almost 11 years, and one has been with me for, like, five or six years. And then I still dabble in sales 'cause I love it, but, I've really tried to let them take the helm at sales pieces. But what really helped us, because, what I was telling Josh is, like, our generalist clients, we have a few generalist clients, and they'll spend 3 or $400,000 on a project-based piece. And so it's really hard to turn that away when it was helping fund this niche development and investment. But what we ended up having to do is, and I will, I will say that one, some of those whale clients we lost, which is what also propelled us forward in our niche, is we needed stability. We needed monthly recurring revenue to grow as a business. But what we ended up doing is we ended up defining lanes, and so we have one that focuses on generalists, and we have one that focuses on the niche. And now our generalist person is also dabbling and starting to handle some of the cold outreach that we're doing with the HVAC. So, I mean, at some point I know we're gonna end up having to hire another person, but we're hoping that instead of hiring another person, we can have the CSSs take on more of the role so that my closers close- Yeah… And that's what they focus on.

Josh Nelson: Awesome. Yeah, that's s- su- super helpful. So we've talked about, like, how you got into HVAC. We talked about what the program package looks like and how you've landed the clients and kinda what the client acquisition piece looks like. Let's talk a little bit about team structure. I see you've got a, like, a beautiful studio there. You've got the building that you run. Is it mostly in-house? Is it, you know, a mix of in-house, out-of-house? Talk to us about the team culture and the, kinda the team organization.

Pam Mashburn: Yeah. So we do have some people that are remote. So we've got… Mm, let me think about that a minute. We have, ooh, about eight or nine people that are remote, and I think eight of them are outside of the US. And we've had two people on our staff that are remote because their husbands got jobs, and so, my philosophy, when I started this business, I was a stay-at-home mom at the time who realized that she was created to work. But one of the things that I realized is that if everybody has a laptop, then if we have sick kids or we need to go help a parent or whatever it is, we can still work when we need to work. So everybody in our office has laptops, and that's just been a culture that we have. But when 2020 hit, one of the things that we realized is we're a lot more productive in-house. And so- Right… We bought, we always had an office, and we bought this building three and a half years, almost four years ago. And so when I bought it, I thought it was really big, and I was like, "Oh, we just need half. I'm gonna rent the other half." Being a good business person, "I'm gonna rent the other half." Well, my team had another idea. So they turned it into conference rooms- Oh, dear… And, you know, lunch areas and, podcast room. And so it's been good. It's allowed us to do some growth and have some, some space to grow. Was that the question that you asked? Oh, you asked about team structure. Yeah. So we have, we run on EOS and have for, like, 10 years, and that I attribute to a lot of how we've grown because it just has given us the structure to be able to realize and adjust with changes in growth. But we have a finance group. So the way our organization is, we have a visionary integrator, and then, below that we have a publications piece, and then we have sales, we have fulfillment, we have CSS, and then we have finance. And, some of, most of our remote people are either publications or some fulfillment. Okay. So- Well, and CSS actually. We have CSSs that are remote. Some, some remote CSSs. Yeah, we do. So that's, that's the org structure. Some people come to the office, some people work from home, and it's kind of a flexible, you know, if you need to work from home, you work from home.

Josh Nelson: Right. What is, like, what is the culture like? It seems like it's probably a fun, vibrant culture. Talk to us about that and how you create… Like, people have been with you for years and years. It's, like, I think you said 13 years for that one person.

Pam Mashburn: Yeah. So I ha- still have the same employee that, the very first employee that I hired, she's still on staff, and- Wow… It's been 14 years, so it's crazy. I think, you know, we work really hard here, and I really, I mean, we talk about the Explore Media way is ex- seeking excellence in all that we do. And so there's a natural tension in the office because if you're seeking excellence and somebody else is seeking excellence, you're both gonna be a little bit at odds because I'm trying to get this done, but my priority over here is something else. And so there's always gonna be a little natural tension there. But, we have a gal on staff, I call her my CFO, my chief fun officer. Nice. And she does make things really fun. We just had an Easter egg hunt, and, it had White Claws that we also, like, searched for around the office. Nice. We do a lake day that's kind of a tradition for our people that are here in the States at my lake place, and that's always fun. And then we'll even have a lake day for our families so that we get to know each other. But on a monthly basis, we have, online team building exercise that we do, and it's only been in the last few months that we've really embraced those overseas folks and really made them a part of our team. I think we just didn't know what to do, and Angie just really took that. She really did some research, and she's done some really fun things with it. Like, the last one we did was It's kinda, sounds really dopey, but it was really fun. It was this, show and tell. So everybody brought one thing, and, like, one of the guys, our videographer guy, brought the ashes of his dog that was his, like, best friend, Nug Nug. And one of the girls that hunts with her husband brought in her frozen duck that they use for their hunting dog. Yeah, it was some crazy stuff. Mine was not anything like that. But- Mm… It was just… And then our overseas guys, they had, like, this was my original book that I learned English out of. This was my guitar. I mean, it was really… So when we have those fun moments, it makes those stressful times a little, like, there's still, there's still that tension, but it makes everybody a little more forgiving and, give everybody a little bit more grace in their work.

Josh Nelson: I love that. I think a lot of organizations, as they grow, they forget, like, if you're not having some fun with the team, you know, like if, you know, if you think about traditional office, you would, like, take them out to lunch or you'd go bowling and stuff like that. When you've got a virtual team, how do you still create that fun, hair-down moment? And if that's w- those are the moments where trust is built. Mm-hmm. And it's, you gotta trust the person next to you. You gotta trust that team. That creates results, but it also creates loyalty and, you know, like yourself, people that are staying with the organization for a long time. Yeah. So I love those examples.

Pam Mashburn: I have great, my CSS manager, he is, here in the States. And he works a lot of times remote 'cause he lives in Birmingham. But, his team is remote, and so I'll get on theirs and he'll do fun things like, he was going to Vegas, so his backdrop was Vegas. You know, and then the next month, the next week, it was, like, a Southwest theme, and he had a howdy hat on. I mean, it was just, like, he really creates a fun environment, and just creating some Slack channels that people can communicate on. So that is something that my team has done. That is not something I've done. And I think just- Mm… Have, bringing in, I like to bring in a lot of different age groups, but we have a mostly young people, and a lot of them have worked remote, so they bring that into the mix, and it makes it fun.

Josh Nelson: Super good. And, and I love the studio backdrop there. It looks like you're getting yourself set up to do more of that type of con- Talk to me about how you use that space, how you're planning to use that space.

Pam Mashburn: Yeah. So we are trying to do podcasts twice a month. Mm-hmm. And so we've been inviting people that can be JV-type partners, like vendors. We've had distributors on and clients. And so one of the things that we're doing is we've actually created a website with our podcast, and we're promoting it so that we can have a really good, high-quality back link for them for SEO. Nice. So that was part, so we're trying to use it for twofold. Then we can also use it for social media for those clients to have clips from it so that we build authority for them. And then we're also starting to reach out to people that aren't clients and getting them on. And it is interesting. We've had a couple of clients on our podcast, and then before you know it, they're up in their package deals, you know, because they get to know us, and we get to know their business better, and that trust just kind of naturally builds. So- Yeah… The podcast has been great. That's great. So twice a month.

Josh Nelson: Mm-hmm. And are you actually bringing people there, or is it on Zoom or, like, a little bit of both?

Pam Mashburn: So it's mostly on, we use, Riverside. I think the same thing- Yeah… You guys are using, yeah. So we use Riverside, and we don't do it live. Thank you, Josh, for making me a nervous wreck. Making this live. We don't usually do it live. But we've had a couple of people that wanted to come into the studio, and if they're just passing through town, they'll come in. And we had one guy, one of my favorite clients, and he came from Nashville. And he goes, "I just think it'd be better if we did it in person." And it was awesome 'cause he came down. Mm-hmm. He got to see our office space, and, he's, he's really a godly man. He, like, ministered to a couple of guys on our staff, gave them a book. I mean, it was just a really neat experience. So if I can do it in person, yeah, I would love to. But we don't let that be a- Mm… Be a constraint. A reason not to. Yeah.

Josh Nelson: Very, very cool. So last question, kinda as we, as we wrap up. You guys won the Operational Excellence Award, which means out of all the agencies in Seven Figure Agency, you had the best retention, profitability, kind of combined metrics. Talk to us about, like, how you think about efficiency and any secret sauce that you've gotten that has helped you, y- you know, really level, you know, produce at that level. Yeah. I, there's a, I don't know if we have a secret sauce.

Pam Mashburn: We'll, I will temper this with last year, we were, I feel like, understaffed.

Josh Nelson: And I ha- Mm.

Pam Mashburn: Yeah… Heard Tim Chernick at the conference talk about you're either gonna be understaffed or overstaffed. Mm-hmm. And I, we made a decision, a strategic decision this year to be overstaffed so that if someone is sick for three weeks, we're not scrambling. If- Right… Somebody leaves, we've got somebody that can c- cover or whatever. So we may not be quite as operationally efficient this year, but it's an investment- Okay… In growth, and so we're okay with that. Yeah. But I will say that some of the things that we have done intentionally, is one, my director of ops, she and I sat together and went through the packages and came up with every, like, this should take this amount. This person- Mm… Or this role makes this amount, so we know what our fixed costs are, what our variable costs are. And so we really looked at a project management thing. And we, then we said, "Okay. Based on that, we're gonna have this percentage." And that's how we pack- Mm… You know, price the packages. And so we were very, I would say, aggressive in really pricing those packages so that we made money, so we profited. So that was one thing that we did. And then the second thing that we did, is we decided to incentivize not just the salespeople, but also our operations team, so that, we could take on more revenue and more profit. And so we set a profit number, and based on that profit number, we would take whatever the, we would take 2% of the revenue, not after profit. But if you hit, you know, 9% profit, then you would get, we would take 2% of that revenue, that eligible revenue, and then we divide it amongst the people on the team. So- Okay… And we do that on a quarterly basis. And if we hit the profit for the whole year, there's an extra 1%. So we look at those numbers, revenue and expenses every month. Not every month, every week. We look at it every week and every, 10 or level 10 meeting for each of our departments, they look at those numbers every week. And it's so interesting, 'cause I think I mentioned this. Last year it was like, "I wanna buy this printer. I wanna buy this new… I wanna buy a drone. I wanna buy all these things." And they're like, "No. We won't make our profit number." Like, they are… So it's not great if you like to spend money, which I do. They're like, "Nope, not spending that. Nope, we're getting pizza. We're not gonna get the, you know, better catering thing. We're getting pizza for the lunch and learn." Mm. So anyway, so they have really held me accountable, and we're finally maturing enough, after 20 years, to actually have a budget and review the budget and make sure. And so, I mean, I think that transparency around the business has made… I have some really good stewards in my business, and they really hold me accountable as well as everybody else. So it's been good.

Josh Nelson: That's phenomenal. So, like, really being intentional about the gross margin, right? Yes. And I think m- most agencies don't do that. They just pick a monthly price, and it's like, all right, that's what we're selling it for. But, like, really figure out what are the hard costs to deliver and make sure you're looking at your cost as the owner, you're looking at all of the team members and their hours, and have a healthy gross margin. That's, like, kind of the starting point for profitability. And then I love what you did where you got the whole team involved in being aware of what those numbers are and being incentivized by it. You're right. Most agencies, salesperson gets a commission, everybody else is on a base salary, and so they have no care whether the company is more profitable or less profitable. It doesn't impact them. Right. But when you open up that number and you kinda get them all bought in, now they're making decisions not just based on is this gonna improve revenue, but also is this gonna improve the profitability, 'cause they're, they're incentivized by it. So I love that, I love that example. That's, that's awesome.

Pam Mashburn: Yeah. Yeah. It's been a, it's been a really great help for us, as far as, you know, we're trying to create a business that is gonna last longer than Pam, right? Mm-hmm. That is gonna be… I mean, it supports the, our livelihoods. And you know, the other thing I'll say on that package piece, because we're, we were talking about our social media and to keep up with what's gonna move the needle, we've gotta do X amount of posts per month- Mm… Not just what we've been doing. So that affects our profit. So how do we do that without affecting profit? Is it AI? So it makes, it forces us to figure out, to be competitive, we have to do this, but we also have to make this profit. So it challenges us to get better.

Josh Nelson: Yeah. Iron sharpens iron, right? Yes. Love it. Pam, this has been amazing. Thank you so much for sharing how you've grown the business, how you've kinda structured the team, how you've structured your packages. So many great insights and takeaways. Guys, if you got value, be sure to reach out to Pam, thank her for sharing, thank her for being abundance-minded and really just coming on and being willing to share exactly what's worked and how she's done it. If somebody did wanna connect with you, what would be the best way?

Pam Mashburn: Yeah. Pam@exploremedia.com is my email, and I'm at three three four two zero one eighty-seven eighty-seven.

Josh Nelson: Oh, wow, leaving her number on there and everything. Pam, last question and we'll, we'll wrap up. The, if you had one piece of advice for that agency owner that's trying to get to the next level, what would that be?

Pam Mashburn: I would say that you need to lean into the Seven Figure Agency learnings. We, we made all, this has been the best investment that our company has ever made, is in Seven Figure Agency. We used the training. So we trained all our people on, you know, the Google stuff. My salespeople attended every week, the sales that Josh Con- Konigsberg used to do. Really took advantage of all the resources. We go to all the conferences. I usually bring more than just me. I bring some of my A players, trying to make sure everybody is bought on. And then, we do monthly lunch and learns, where I provide lunch, and usually I like to do not pizza, something healthier. But-… We, a lot of times, we'll watch, a podcast, Tony Ricketts or somebody within Seven Figure Agency, and then we'll stop it and we'll say, "That's really interesting. Can we adopt that?" And then we use it as, like, how do we get better? And so my coach, Nick, has been amazing. I called him the other day about something I was struggling with. The resources, the Facebook group, I mean… Yeah, you should be charging more, but don't. Don't. Don't. It'll mess up my profit.

Josh Nelson: Thank you so much for saying that.

Pam Mashburn: I really appreciate it, and, it's been an honor to be part of your continued growth and success.

Josh Nelson: Thank you. I'm excited to see you at the next intensive. So thanks for listening, everybody. If you've got follow-up questions or thoughts, drop them into the comments, and be sure to drop a shout-out for Pam for sharing today. Thanks so much, and we'll see you on a future episode of the Seven Figure Agency podcast.

Transcript of Pam Mashburn’s testimonial video.

It is the best investment we've ever made. Hey, I'm Pam Mashburn. I'm with Explorer Media and Explorer HVAC. My niche is HVAC and home services. Um, when we joined 7FA two years ago, we were at about ten thousand MRR. We had three clients, and now we are at twenty-six clients, and we're at a little over a hundred and two thousand per month MRR. The reason we joined 7FA, we had been doing digital marketing with our business since twenty-nineteen, but we just didn't have the processes dialed in, and we just felt like we were alone on the agency island, floating by ourselves.

And so we came on board and really got a lot of bang for our buck. We, um, took advantage of all the training. We took advantage of all the different specialty coaches that they have. More than that, actually, it helped me as a business owner to just really figure out how to lead my team, putting in a lot of different systems in place so that I could really manage and lead the, the organization instead of being stuck in the weeds all the time. The most important thing and most valuable thing for me in 7FA is the intensives.

I love the learnings, getting to work on my business instead of in my business. Um, I love learning about, um, things that people are struggling with that I might be struggling with. Um, and sometimes it's learning about the things that are coming up as I'm growing my agency. When I hit that next milestone, what I need to do to, to stay away from those, those issues that, that typically pop up. And honestly, I meet with people almost on a weekly basis, different people that I've met, different mentors and different coaches, and it is the best investment we've ever made.

The growth of our agency has impacted me personally in that we're taking more trips. I'm spending more time with my husband. The things that I'm doing for my business, I'm spending time on the right things, like don't spend time on the ten-dollar-an-hour items or tasks in your business, but assign that to someone else, and working on the things that really move the needle and make a difference. In the next twelve months, we have some pretty lofty goals, um, and we expect that we would increase our MRR, um, by another eighty-three thousand per month.

We thought about joining the Seven Figure Agency group for about a year before we actually pulled the trigger. It seemed like a lot of money to invest, and, um, we just run our business very conservatively. But we made the leap, made the investment. It has been the best investment we have ever made. Just money that I've saved in taxes from learning what other agencies are doing has paid for itself. But more than that, um, it has just been the catalyst that's helped us to grow. If you're thinking about doing Seven Figure Agency, don't wait a year like I did.

I wish – we would be so much further along if I had gone ahead and done it. Um, I tried to self-let, self-implement some of this stuff, and you really just need that accountability group to do it.