The 5 Stages From Operator to Owner

John Jantsch (00:01.768)

So what if being the CEO of your own agency is the trap that most founders mistake for the finish line? Hello and welcome to another episode of the Duck Tape Marketing Podcast. This is John Jantsch. My guest today is Jason Swank. He's the founder of Agency Mastery, host of the Smart Agency Masterclass Podcast and author of a book we're going to talk about today, Operator to Owner. He's built and sold his own digital agency after working with brands like AT &T, Hitachi, and LegalZoom.

And today he advises seven and eight figure agency founders on building businesses that run without them. Jason, welcome to the show.

Jason Swenk (00:37.918)

Thanks for having me, John.

John Jantsch (00:40.484)

So you built and sold your own agency before any of really the consulting work that you do now. When did you kind of come to the realization that maybe, and maybe this didn't occur for you, the agency owned you more than you owned it. Did you ever have that moment?

Jason Swenk (00:59.394)

yeah. A bunch of times. mean, I can't even count that many times. So the one that I remember that is the whole purpose behind, you know, writing the book was I kept coming home every night and I was just completely exhausted, miserable. We were probably at that time, I think around 2 million in top line revenue. So we weren't small, but we weren't, we weren't big either.

John Jantsch (01:25.372)

Mm-hmm. Mm-hmm. Right.

Jason Swenk (01:27.32)

but everything was on my shoulders. And my wife said, why don't you go get a job and shut it down? And so I took a job interview with NASCAR and they asked me two questions, not to race, I would have taken that job, but they said, what do you want to do every day? And what do you never want to do again? And those two questions changed everything for me.

John Jantsch (01:53.0)

So.

I think a lot of people wrestle with the first one. I don't think enough people wrestle with the second part of that. so they stay stuck in the second one, which keeps them from doing the first one, right? mean, so go ahead, yeah. Well, I was gonna ask a question about the book at least and your work, you've identified these five stages that you need to climb through. You wanna unpack that?

Jason Swenk (02:12.76)

Well, they... Go on.

John Jantsch (02:25.508)

a little bit, you don't have to do every stage what it means, but just kind of give us the framework.

Jason Swenk (02:27.843)

Go.

Yep. So as founders, we all start off as operators where we're doing everything. Okay. So then what happens is we're having fun and we concentrate on sales and then operations takes a hit. And then we focus on operations and then sales takes a hit. And this, it's, it's this roller coaster ride. And then what happens is we go, we want to grow and I don't want to be doing everything. So what you start to do and you're working 80 hours a week as an operator, right? If not more.

John Jantsch (02:59.398)

Yeah, yeah, yeah.

Jason Swenk (03:00.984)

And we've all done it and we all have to go through all these roles, right? And so then you transition to a manager. But the problem is we suck at managing people. We are horrible at managing people. And so we hire the wrong people. We don't have systems for them. So now we're stuck doing the same amount of work that we were doing before, plus managing them, plus probably even doing their work. So now we're paying them.

John Jantsch (03:12.676)

Yeah.

Jason Swenk (03:28.886)

and doing more work. It doesn't make any sense. Have you gone through that?

John Jantsch (03:32.892)

Yeah, yeah, well, absolutely. mean, I, you know, like many of folks you've worked with over the years had, did everything myself. I was a one person shop. I've been doing this 30 years now. So I did finally figure it out. And, you know, we have a CEO. I, you know, I'm the chief innovation officer, which is code for I can do anything I want. And so, but it took a long time to get there. And it took a lot of, a lot of, you know, I think the hardest part was,

I like doing the work that an agency does. I'm pretty good at it and I enjoy it. And in a lot of ways, even when it is no longer profitable for that person to do that work, that's the hardest part of giving it up is it's not even so much like I don't trust other people. It's like, what about me? What am I going to do?

Jason Swenk (04:24.618)

So that's what I call the rubber band effect. And I've gone through it too, right? So when I sold my first agency, I only reached the fourth level, which is CEO. But when I reached that level, and I'll talk about the other levels too in a second, but when I reached that level, I only had to work like 20 hours a week. And so mentally going from 80 hours a week to 40 hours a week to 20 hours a week, and I would go into a creative meeting. No Jay, I'm good.

John Jantsch (04:26.887)

Yeah.

John Jantsch (04:38.524)

Yeah, yeah.

Jason Swenk (04:53.922)

go into marketing me, no, we're good. And I was like, they don't need me anymore. So what do we need to do? We need to get in there and mess stuff up so we feel important again. And it's, and the whole book is really about, it's not about who you need to hire, it's about who you need to become and the identity shift that you go through because look, we all go through it and some go through it faster than others. But if I can like, when I was writing this book,

John Jantsch (04:55.377)

You

Jason Swenk (05:21.484)

It was really kind of like writing it to my sons if they ever wanted to go into business. Like, here's all the stuff that you're going to be going through. Just know, like, if I'm not here, here's what you need to do.

John Jantsch (05:25.576)

Mmm.

John Jantsch (05:32.936)

Yeah. You know, you mentioned this identity thing and we, you know, we work with a lot of agencies as well. On top of having our own agency, we have a network, you know, similar to some of the work I think you do with agency owners. And what we're finding is right now they're going through not just a sort of an existential identity crisis right now because of what's going on with AI and

the changing attitudes of the buyer and what their expectations are. I so I think a lot of, I don't know if they all have the answers, but certainly a lot of agencies right now are asking some pretty hard questions like what business are we really in? And I think that's really got to add to this kind of owner doubt or owner dependency, doesn't it?

Jason Swenk (06:20.738)

Well, the thing that I realized and what everybody else needs to realize is this. So when you get to the different level and you want to stay there, you have to realize that the agency needs you for something different now. It doesn't need you for what you used to do. And so when you can get to the CEO stage where you're steering the ship and you're protecting culture, you're investing in the things, right? And building better leaders, that's your main goal as a CEO.

John Jantsch (06:47.485)

Mm-hmm.

Jason Swenk (06:49.646)

I'll give you a story that will explain this like that. The other day, we were trying to make our podcast more efficient using AI and creating some AI agents. so Stacey and I jumped on a call on a Zoom and I started building it in front of her. I basically did it where it does everything. And then I realized, go, if I build this all for her, she is getting robbed.

John Jantsch (07:00.538)

Mm-hmm. Right.

John Jantsch (07:08.605)

Thanks.

Jason Swenk (07:18.656)

And just because I'm experimenting with AI or if we're using, you know, for our sales team, we'll use AI agents and all that kind of stuff. I need to train them. So I literally hit delete right in front of her. said, I want to, I want to show you it's possible. Now I want you to go do it. And it's the mentality that I've always thought about is I can give fish to my team or I can teach them to fish. And that's what we need to do.

John Jantsch (07:29.893)

Yeah.

John Jantsch (07:43.58)

Well, and I think, and I think really when it comes to AI particularly, that's the skill they need to have because otherwise they're just gonna get replaced. I mean, they're not going to have a purpose, I think. And so I think that's great. I do wanna go back to the stages, a little bit of progression because each one has its own challenge to get out of, right? But I will say that for me, when it finally felt like it was a possibility,

was when I finally had somebody who could actually sell and land the big client, you know, that wasn't asking for me anymore. And it was really until that happened, I didn't feel like I could be free of, you know, running the business.

Jason Swenk (08:29.358)

Yeah. So that's when you get to a place where it's the third stage, an architect, we, where you design a system, but a lot of agencies have you seen where businesses, what they'll do is they have no clue. They, they know how to program and do something really cool, right? Like I'm an accidental agency owner. I designed a website, making fun of one of my friends called in shit and it looked like in sync. And I was off to the races. So I didn't even know what the invoice was. I didn't know all this stuff in 99 when I created it.

John Jantsch (08:34.834)

Yes.

John Jantsch (08:45.704)

This is

John Jantsch (08:50.92)

Yeah. Yeah. Yeah.

Jason Swenk (08:59.18)

had to figure it out. And so we were reacting to it. And so what a lot of people do is they hire a salesperson with no systems, no agenda, no outcome. It's like going to chat GBT and say, create me a website and all you do is get garbage, right? You give it no context, no system. And so when I was able to give them context and D I'm curious what you think on this. when you hired your salesperson,

John Jantsch (09:12.456)

Yeah, right.

John Jantsch (09:17.416)

Okay.

Jason Swenk (09:28.918)

It probably took you a while to hire a salesperson that did with me. And I tried to think back, why was that? Why was I the best salesperson? was because I knew all the stories.

John Jantsch (09:40.454)

Yeah, right, right, right, Yeah, and.

Jason Swenk (09:43.138)

All I had to do is share the stories in the system. Voila.

John Jantsch (09:47.91)

Yeah. Well, and frankly, accidentally, that's what I did. I, was a long time employee, you know, who was doing the work, you know, who was really good at serving the client who then, you know, knew all the stories and was able to, and hung around long enough, was able to really, you know, the fact it was kind of humorous, you know, I'd listened in on the calls and I was like, you heard me say that one time, didn't you? You know, and it was just,

you know, almost like playing back what I, you know, the kind of the anecdotes that I had done, but she also had her own stories. And I think, I think you're absolutely right. It's really hard to hire that person that's been so-called classically trained as a salesperson, you know, and expect them to be very productive. And, you know, you probably get these pitches. mean, we get them all the time of, you know, people wanting to come and generate leads for us and wanting to, you know, close deals for us. And it's like, I wouldn't want the leads you would generate, but it's.

Jason Swenk (10:41.838)

No, no, not at all. Yeah.

John Jantsch (10:43.368)

But it's like an epidemic. must be the most lucrative business going right now is generating agency leads, because there's sure a lot of people pitching me on it.

Jason Swenk (10:55.47)

There was a certain individual that would be nameless that had a course that taught all these people how to travel the world and do it. And it's the same pitch over and over again.

John Jantsch (11:05.736)

So, I know a lot of business owners, and this is not just agencies, I this is just business owners in general, is have kind of this, I'm going to call it a false assumption, that if they're not doing the work, if they're not hanging on to and checking the work and, you know, there every moment, that it's not going to be done as well as they could do it. How do you get people passed up? Because obviously that's a constraint that is going to keep you from going anywhere.

Jason Swenk (11:34.799)

So you have to kind of throw your team into the deep end without floaties. And I was telling our group of our community last week when I was speaking to them, I said, you got to be okay with fender benders, but avoid the train wrecks where you have to let them know where we're going. What do you expect from them? I always people that report to me, they can manage themself.

John Jantsch (11:38.982)

Right? Yeah.

John Jantsch (11:53.032)

Yeah.

Jason Swenk (12:04.195)

That's the key. And I have systems in place to allow them to make decisions without coming to me because when you're the operator or the manager, you're the bottleneck. And especially with AI, AI enhances everything. So now you have even more work, which you would think you wouldn't. But if you don't create these decision layers and these systems in place and you create that as an architect,

John Jantsch (12:05.64)

Yeah, yeah.

John Jantsch (12:23.29)

Isn't that funny?

Jason Swenk (12:32.921)

The other thing too about all these roles, Like, obviously we have architect CEO and then owner, which everybody thinks they're the owner of the agency, but really come on, the agency owns your ass.

John Jantsch (12:38.268)

Mm-hmm.

John Jantsch (12:42.6)

Yeah, 2 % of the time you're the owner.

Jason Swenk (12:46.147)

That's right. You start an agency to leave the nine to five to start a 24 by seven. Like, doesn't make any sense.

John Jantsch (12:55.762)

Yeah, yeah. I can't remember. think it was, you're probably familiar with Michael Gerber's work on the E-Myth, but I think I remember hearing him say one time that, you know, I went into business so I could be free, know, free to work any eight hours a week I choose. That's really kind of what it is.

Jason Swenk (13:13.903)

That's right. Well, well, in my goal, and we always used to, mean, you've been in the agency world a while. And so I was on the tech side for a long time. We always used to tell people joking around that we have support 24 seven, 24 days out of the month, seven months out of the year. And so that's, that's the goal to work, right?

John Jantsch (13:34.536)

Absolutely.

I'm curious where you land because I get this question all the time. You know, lot of people that are starting a consulting or fractional CMO practice and they're like, I need to niche. I just haven't figured out what my niche is. I'm curious where you land on there. My view is it's really hard to pick a niche unless you've got like deep history in it or experience in it. And like, what if you pick the wrong one? You know, because you've been told you have to pick one. I'm curious where you are.

Jason Swenk (14:08.271)

So I had a member, man, we were screaming at him for years and years to pick a niche, okay? They picked a niche and they picked conferences. I was like, man, that's great. Like conferences spend a ton of money. The issue was six months prior or six months later, COVID happened.

John Jantsch (14:31.688)

Yeah, yeah.

Jason Swenk (14:34.595)

Right? So he had to pivot and he pivoted to cybersecurity and now crushes it. Now, so here's my deal on picking a niche though. I do believe that you need to pick one, but it takes people a long time because like you said, how do I know which to pick? I treat it like a Vegas buffet. If you've ever been to Vegas and the buffets, right? Like you got, you try it out everything.

John Jantsch (14:39.037)

Mm.

John Jantsch (14:55.954)

Yeah, yeah, yeah.

Jason Swenk (15:00.131)

And then you're like, man, I really like these crab legs. I don't like the prime rib over here. And then like, anytime you go back, you're like crushing those crab legs, if you're anything like me. And so the question that I always tell people in picking a niche is not who do you work with the most clients or who are the most profitable ones? I always say, if you had to be paid on performance only, who would you do it for and what would you do for them?

John Jantsch (15:11.464)

You

John Jantsch (15:27.112)

Yeah, yeah, yeah.

Jason Swenk (15:29.913)

So now you're setting yourself up for success and then you can start understanding the client's biggest challenges, their struggles. But here's the key, you don't have to fire all your other clients. You can take on work outside of it. You're just marketing to that niche. That's my stand on it.

John Jantsch (15:43.496)

Yeah. Yeah. I mean, I think mine's very, very similar to that. I always tell people, it find you, you know, as opposed to the one I have a problem with is the people that have been told you have to pick a niche. So they just go out there and say, well, here's where I think I could. Yeah. You know, and, and three months later they have to start over again because they've got everything set up for dentists and they hate dentists now. So it really, you know, I think we're, we're in sync on that.

Jason Swenk (15:57.199)

drama.

John Jantsch (16:11.514)

All right, so once a founder has made it all the way to owner, what's their week look like now? Day to day.

Jason Swenk (16:19.725)

You can do anything you want. The business does not depend on you. All you have to do is be accessible to the leadership team for when they have things that may come up, they wanna bounce off you. So like one of the example I use in the book is Tony Robbins. He is an owner of a thousand companies. He cannot, even if he owned five companies, he could not be the CEO of five companies, right? Then you're dividing.

John Jantsch (16:44.252)

Right.

All right.

Jason Swenk (16:49.579)

it's just not fair or even an architect or whatever it is. And most people don't reach the owner realm other than stocks. Like I was able to reach that when we started another agency, but, that was great. And they would just come to me like I was on the board. Okay, cool. Like here's what, what I would do, but it's not fulfilling. So you got to make sure you do other stuff. Like when, when I sold my agency for the first time, I was really depressed because I sold my baby.

John Jantsch (16:57.042)

Yes.

Jason Swenk (17:18.191)

I didn't have any sense of purpose. actually went to a Tony Robbins event, walked on that stupid fire, all that kind of stuff. He saved me. No, just kidding. like, I didn't have a sense of purpose because my identity was being an agency owner versus being creative, innovative, all the other things that I could contribute to other things.

John Jantsch (17:22.088)

Nice.

Ha ha ha ha ha.

John Jantsch (17:34.012)

me

John Jantsch (17:38.748)

All right.

I'm curious, is there one thing that you held on to too long? And I guess the flip side of that is what changed when you finally were able to let go of it.

Jason Swenk (17:52.643)

So I held onto sales for too long. And then I even competed with my sales team, which is unfair because like, like I'm going to give away a good lead. Right. And, and I was always a competitive person, right? Like I paid, you know, tennis through college. So I was, I will crush anybody. Right. Like it was just that that's my mentality. And so I held onto that too long.

John Jantsch (17:55.206)

Yeah. Yeah.

John Jantsch (18:07.848)

Yeah.

Jason Swenk (18:20.465)

You know, I was, yeah.

John Jantsch (18:20.518)

That's, that's, I did the exact same thing, probably, but also it is hard, think a lot of times, especially, mean, you, you're a public figure. I've written books that have sold well. And so people come to us and I mean, my close rates like 99%, you know, because, because I'm just like, you want sure. I don't know how we do anything here, but you're talking to me.

Jason Swenk (18:45.903)

We're not selling them, right? They've already sold.

John Jantsch (18:50.16)

Right. And so it is, you do kind of get a rush of that and it's hard to, hard to let go of that. So I was probably in that same boat.

Jason Swenk (18:57.263)

And I just had to realize I had to put my effort into building a better team and really coaching them, not managing them. Going back to what I was saying before is like, how can I build a better leader where they can build better systems and become the architect? And even these five roles that I described, it could be an employee right now. It could be anybody. And so it's just, we all need to evolve.

John Jantsch (19:02.876)

Yeah, yeah, yeah, yeah, yeah.

John Jantsch (19:20.486)

Yeah, yeah, yeah.

Jason Swenk (19:25.709)

especially now more than before, more than ever. If you're not evolving, you're not doing anything.

John Jantsch (19:28.968)

You cannot sit still. No. Yep. All right. So for the agency owner listening, I know they're playing out there that are listening to the show and the business depends on them too much. They know that. What's one move they can make in the next 30 days to really kind of start this climate of yours.

Jason Swenk (19:46.969)

Well, it depends on what role they're at. So let's say they're at the operator. Well, they need to figure out who do they, what role do you need to get away from that you're not good at? So if I'm really good at sales, I need to hire a project manager, but I need a project manager that can manage themselves. Right? And just be honest with them, say, look, I suck at process. I need you to be able to create this. Now, if they're at a manager,

John Jantsch (19:57.414)

Mm-hmm.

Jason Swenk (20:14.543)

It goes back to like, you need to evolve to an architect. So you need to start removing being the bottleneck. And how do I build a system or a layer of systems so people can make better decisions without coming to me? Right? That's really it. Then if you're an architect, how do you start building people that can architect the systems that you're already building? And then if you're a CEO, you know, and that's one thing I want to tell everybody.

Some people may only want to reach architect and that's perfectly fine. You don't have to go all the way up to the top. And wherever you're at now is just the starting point. And just to enjoy the journey, when I look back at the first agency, some of the stuff that I was like, I can't wait to get rid of this. Those were the things I remember the most. Burning the midnight oil with the team and creating the sites and programming this and all that kind of stuff. That was really cool looking back.

John Jantsch (21:04.067)

If you

Jason Swenk (21:12.941)

Now you can't maintain that for a long time, but it was pretty.

John Jantsch (21:16.321)

Yeah. Well, Jason, I appreciate you stopping by the Duct Tape Marketing Podcast. Is there some place you'd invite people to connect with you, learn about operator to owner, and find out more about your work?

Jason Swenk (21:27.619)

Yeah, yeah, if you go to operator2onerevolution.com, you can get a link to get the book as well as there's a diagnostics, diagnostic, if I can say that right, that will tell you what stage you're at. Because a lot of people think they're at a different stage and they'll implement different strategies and then it won't work. So make sure you go to operator2onerevolution.com and you can check it out, it's free.

John Jantsch (21:55.024)

Well again, appreciate you taking a few moments and maybe we'll run into you one of these days out there in western Colorado.

Jason Swenk (22:01.571)

I hope so.

John Jantsch (22:03.292)

Awesome.