There's this, this idea going around in AI right now. It says, the fast track to making money is starting an AI automation agency. Sounds flashy, right? Modern. Yeah. Lucrative, even. But what if it's not quite the golden ticket, it seems? What if it's more like a bubble? We've got some insights from a founder who, well, they built a big agency, sold it for millions, and then
walked away saying, hold on. think again welcome everyone yeah today we're really diving deep into this our mission basically is to unpack why this popular ai agency model might actually be a trap for many we'll get into the real story from someone who lived it and then the exciting part we'll look at three other ai business models ones that are actually scalable actually profitable in the long run we've even got a kind of build -in public blueprint to share how you might actually
do this yourself Okay, let's get into it then. The appeal of an AI automation agency. I get it. It feels cutting edge. You're helping other businesses automate using AI. What could be wrong with that? It sounds great on paper. Yeah, but here's the thing. The secret that often gets missed. These AI automation agencies, they're not really AI businesses in the way you might think. Fundamentally, they're traditional service businesses. They just happen to use AI as one
of their tools. It's like... Think of a personal trainer. They're so busy training other people, they don't have time to work out themselves. The agency owner is selling their time, their team's time, their problem -solving skills. They're not building their own leverage with AI. That's the crucial difference. That's a really clear analogy. And this isn't just hypothetical, is
it? We have this story, this cautionary tale from a founder who actually did it, built a tech agency, scaled it to, what, $2 .6 million a year, 25 employees, sold it, looked like a huge success from the outside. But hearing them talk about it. They called it a trap that looked good. Exactly. That multi -million dollar operation from the inside was a daily grind, a constant battle. They identified four big problems, what we're calling the high revenue grind. First one, the
leaky bucket of doom. Agencies are always losing clients. It's just the nature of it. A key person leaves the client company, budget shift, they get bought out, boom, a chunk of revenue disappears. So you're constantly, desperately hunting for new clients just to fill the holes. Forget growth, you're just trying not to shrink. Wow. So just maintaining feels like a full -time job in itself. It absolutely is, and that feeds right into the second problem. The hiring and firing roller
coaster. You land a big contract? Great. Now you scramble to hire people? Fast. Then the project winds down, maybe the next big one isn't signed yet. And you're faced with letting good people go. It's incredibly stressful. Unstable for everyone. Which leads to number three. The fire chief reality. As the owner, you think you'll be setting strategy, right? Visionary stuff? Nope. You're the chief firefighter. Client's mad. Your problem. Deadline missed. Your problem. Server down. Team conflict.
All land on your desk. Your day is just reacting to the latest crisis. Zero proactive work. That sounds utterly exhausting. Just constantly putting out fires. And after all that, what was the end result? The big payoff. Well, that's the final problem. The 12 -year grind. This founder spent over a decade in this mode. Then they sold the company. And the kicker. Those millions they got. It wasn't retire to an island money. It was, in their words, just enough to start over.
All that work, all that revenue didn't buy freedom. Just the chance to get back on another hamster wheel. It really drives home that illusion of the AI business, doesn't it? When it comes down to it, it's still managing people, managing problems, often at 2 a .m. So for someone thinking about starting an agency right now, what's the bottom line here? It's selling human time, not building scalable AI assets for yourself. OK, but let's be fair. It's not always a bad move to build
an agency, is it? There must be situations where it does make sense for certain people. Oh, absolutely. If you genuinely love building teams, if you thrive on managing complex client needs, navigating difficult conversations, designing systems, if that's your true passion, then sure, an agency can work. But the key is you have to go in knowing it's a service business. It's not a product company. The scaling mechanics are totally different. Right. And this is where the thinking gets...
Really clever, I think, this idea you mentioned, the pro -level upgrade, the client as an angel investor model. That sounds intriguing. What's the twist? This is a really smart pivot, yeah. Instead of trying to build a big, sprawling agency, you deliberately take on only, say, two or three clients, good clients, paying a fixed monthly fee, predictable income. But here's the mindset shift. These clients aren't your main business.
They're your funders, your angels. You use that steady income, that predictable cash flow to finance the development of your real business on the side. which is your scalable AI product or productized service, suddenly client work isn't the trap anymore. It's the launchpad. Ah, okay. So it's not the end goal itself. It's the engine to power the real goal. Exactly. You're leveraging service income to build lasting, scalable assets. Mid -role sponsor, read placeholder.
All right. So we've seen the potential pitfalls of the standard agency model and a clever way to use client work as funding. Let's shift gears now to the main event. The truly smart, truly scalable paths. What are these three types of AI businesses that actually make long -term sense? Right. So instead of that agency grind, think about these three routes. They let you benefit directly from AI's power. First up, AI services, but done the smart way, the productized way.
This is probably the most accessible starting point for many. Instead of doing custom work for every client, you create a standardized service package. Something repeatable. You use AI and automation to do like 90 % of the work. You're basically sending access to your efficient AI -powered machine, not your time block by block. Can you give us an example? Make it concrete. How would that look in practice? Sure. A great one is a productized content creation service.
Think about all the experts, coaches, consultants who know they should be creating content, but they hate writing. or they just don't have time. Your service could be they record a quick voice memo, maybe drop a messy draft into a folder. Your system, mostly automated with AI, takes that raw input, transcribes it, cleans it up, turns it into a polished blog post, maybe some tweets, a LinkedIn piece, an email. You get the idea. The heavy lifting is done by the system.
Your role is overseeing it, maybe some light QA, managing the client relationship. That's a true AI business. You're leveraging the tech. Beat. Whoa. I mean, just imagine scaling that kind of content engine, delivering huge value to tons of clients with minimal extra effort from you. That's powerful. That's a world away from custom projects. Huge difference. Okay, what's model number two? The second one is automation templates. This is where you can potentially
build a, say, $5 ,000 digital product. this is super interesting instead of running the service for people you package up the actual automation system itself the templates the workflows maybe using tools like zapier or make and you sell that system along with instructions on how to use it this is what the founder we talked about eventually did so successfully why is it great well the profit margins are potentially massive right build it once sell it thousands of times
delivery cost is near zero it scales infinitely selling the one thousandth copy takes no more effort than the first you can charge Premium prices, too, because it's not just information. It's a working system, a business in a box for a specific task. And crucially, almost zero client management after the sale. Maybe a support forum, but no ongoing service delivery. That founder sold his content engine database for $5 ,000 a pop. People bought it straight off the page.
No sales calls needed. Incredible scalability. Just pure asset leverage. What's the third type? Third is information products. The scalable goldmine. potentially. Now, when people hear info products, they often think, I don't know, courses, teaching how to make money online. But there's this massive underserved market professional AI education for established businesses. Think about it. From your local dentist to big corporations, most
companies are way behind on AI. Maybe one or two people are playing with chat GPT, but that's it. They lack real internal knowledge on how to apply AI strategically. This creates a huge opportunity. If you can package AI knowledge professionally for specific industries, things like AI for healthcare administration or AI for financial compliance, real practical applications. These companies need this training. They have budgets for professional development. They're
not looking for hype. They want real skills for their teams. Okay. So across all three models, the key theme seems to be creating something once you can then sell over and over again. Yes. Creating assets that scale independently of your direct time and effort. That's the goal. So let's circle back to that founder's story. After selling the agency, how did they actually stumble upon this $5 ,000 product? It sounds like it wasn't exactly planned. Not at all. It was completely
accidental. After selling, he was basically starting from scratch. One person, no team. Big adjustment. He knew he couldn't just rebuild another service agency, couldn't face that 12 -year grind again. So he was doing what lots of people do, creating content, trying different marketing things. And he found himself struggling to organize his own content workflow. Just to solve his own problem, he built this simple little database using Airtable
and Zapier. Nothing fancy. Then, almost on a whim, he started making short TikTok videos showing how his simple system worked, how he automated his content repurposing. The reaction was instant and huge, videos getting 100 ,000 plus views. People were messaging him like crazy, saying, I need this. So the market was literally yelling at him, telling him what it wanted. Exactly. But here's the first mistake he made. He didn't
listen initially. He was still chasing other, more complicated business ideas that weren't getting traction. You know, I still wrestle with trying to overthink what the market truly wants sometimes. It's so easy to ignore the obvious signals right in front of you. Anyway, eventually he did listen. He set up a simple $10 a month community just to show people his Airtable system. Got over 100 members right away. Clear validation.
But then came mistake number two. He started doing one -on -one Zoom calls with members, and everyone had these long wish lists. Can it do this? Can you add that? Complex stuff. He felt pressured to please everyone, started offering these $15 ,000 custom setups, which became total nightmares. Unprofitable, complex, stressful. So trying to please everyone with complexity almost derailed the whole thing. Pretty much. He was close to just quitting. But then he had
this epiphany. Simplicity scales, complexity fails. He went back. Ricked out all the complicated features, made the core system simpler. Instead of custom installs, he made clear video tutorials showing how to set up the simpler version. And he packaged that simpler version as a $999 course first week. Sold 50 copies. And people were happier because it was easier to use. That led him to
this kind of golden rule. Every time he simplified the product, took features out he found he could actually increase the price his engineer brain wanted complex features but the market just wanted a simple solution to their pain the market won and refining that led directly to the 5 000 automation template that's now doing you know 40k to 75k a month what a turnaround it really underscores the power of simplicity and this whole journey leads us to this build -in public blueprint,
the practical plan. Can you walk us through the steps? Yeah, it's a really straightforward four -step blueprint. Anyone can follow this. Step one, pick your lane. Focus on solving a problem in one of the big three areas of human need. Money, think business. Productivity, investing. Health, fitness, wellness, mental health. Or relationships, dating, family, networking. Choose one arena. Step two, build in public. This is the absolute core of it. Don't hide away building.
Make your building process become your marketing. Every time you work on your solution, document it. Record your screen, talk through your process, share the journey, the wins, the struggles, the breakthroughs. This raw, authentic stuff is your marketing content. Building and marketing become the same job. That makes so much sense. Killing two birds with one stone. What's step three? Step three. Community first, products second. As you're sharing your build and public journey,
invite people into a free community. Could be school, Discord, Facebook group, whatever. The key is, don't sell anything yet. Just gather the people who are interested in the problem you're solving and your process. Build that audience. Learn from them. Let them see your expertise grow. They become your best source of market research and your future first customers. OK, but the big question everyone asks, if I build it all out in the open, won't people just steal
my ideas? That seems like a massive risk. It's
the most common fear, but honestly. it's largely misplaced look people can try to copy your product anyway especially with ai now someone can take screenshots feed it to an ai and get a clone pretty quickly your real competitive advantage your moat isn't the finished product it's your process and your audience by building in public you understand your customers real needs way deeper than any copier ever could you build trust you build connection and you're naturally always
six months ahead while they're busy trying to copy the thing you show last month, you're already working on the next iteration based on real feedback. The winning formula is audience plus deep insights, just a product every time. Right. So transparency, ironically, becomes your biggest protection and advantage. Precisely. It builds trust and gives you that priceless, continuous market feedback loop. OK, so we know how to start with this build in public approach and why it's powerful. What
are the concrete advantages? What's the real payoff for working this way? Yeah, the payoff is huge. There are at least five unfair advantages you get over people building in secret. One, market validation happens automatically. You're not guessing if people want your thing. They tell you every day in comments, DMs, your community. Two, customer service becomes content. Instead of answering the same question privately 10 times, you make a video answering it publicly. Helps
hundreds. Becomes marketing. Three, product development stays lean. You only build what your audience actually asks for and needs because you're getting constant feedback. No wasted effort on unused features. Four, competition becomes irrelevant. Seriously. While they're reverse engineering your last version, you're building the next one with your community. They can't copy your audience or your insights. And five, sales become natural.
When you finally release your product, your audience already knows you, trusts you, understands the value. They watched you build it. Selling is just opening the door. That sounds like a much less stressful way to launch something. So what kind of content actually works best in this model? How do you create stuff that connects and eventually leads to sales? Good question. It's not about slick, polished corporate stuff. The content that really resonates here does four key things.
First, it teaches while you build. Every time you figure something out, solve a problem in your build process, share it, teach it. That positions you as a generous expert. Second. It shows your thinking process. Why did you make that design choice? What's your strategy? Let people see how you think. That builds massive trust. Third, and this is important, it includes your mistakes. Don't just show the highlight reel. Show the bugs, the dead ends, the frustrations,
and then show how you fixed them. That vulnerability is relatable and builds way more connection than just success stories. And finally, it solves a real problem. All your content should ultimately tie back to the core problem you're helping people solve. It reinforces that you're focused on their pain point, not just cool tech. That feels very authentic. Build trust by being open and helpful. But surely there are ways this can go wrong, too. What are the common traps people fall into?
Oh yeah, definitely. We call these the anti -patterns. Five big traps that'll absolutely kill your progress if you fall into them. Number one, the secret laboratory. Building in silence for months, then launching to crickets. Fix. Build in public from day one. Simple. Two, the jugglers act. This crazy cycle where you're either 100 % building or 100 % marketing, constantly switching, burning out. Fix. Merge them. Building is marketing. Three, the more is more fallacy. Thinking a complex
product with tons of features is better. Fix. Simplify relentlessly. The market pays for elegant solutions to painful problems. Complexity confuses and kills sales. Four, the trend chaser. Hopping onto every new AI tool or technique without actually building something useful that solves a core problem. Fix. Anchor yourself in a real human need. Money, health, relationships. AI is just
the tool. And five, the agency delusion. This is starting a traditional service agency hoping it will magically turn into a scalable product business later. Fix. Be honest about your goal. If you want scalable assets, focus directly on - productized services, templates, or info products from the start. So a lot of success here seems to be about discipline, focus, and simply avoiding these very common mistakes. Yes, steering clear of these traps keeps you on the right sustainable
path. It's often more about what you don't do. Okay, let's try and wrap this all up. What's the big idea here? The core message seems to be that the standard AI automation agency model, while tempting, often leads to this high -revenue, high -stress trap. It doesn't necessarily build freedom. But the good news is there are smarter, more scalable ways to use AI to build your own business, your own assets. Exactly. And it's about playing the long game. This isn't a get
-rich -quick scheme. It's more like get -rich -smart. Building an AI -powered business this way, building in public, takes time. It won't happen overnight. But every day you do it, every piece of content you share, every interaction in your community, you're laying another brick. You're building multiple valuable assets simultaneously. Genuine expertise, a loyal audience, deep market understanding, and eventually revenue streams.
It's like gaining XP in a video game. Even if your first product isn't a home run, you keep the experience, points the audience, and the knowledge. Those assets make your next attempt much more likely to succeed. They compound. It's a much more resilient approach, so it doesn't need a complex plan or huge investment to start. It boils down to this simple, repeatable loop. Let's quickly recap that six -step loop for everyone listening. Step one. Pick your arena, money,
health, or relationships. Choose a broad area. Step two, identify a villain. Find one specific painful problem within that arena that simple AI automation can help solve. Step three, start the broadcast. Just hit record. Start building your solution and share the process publicly. Step four, share the journey. Post everything, the good, the bad, the ugly, your process, your findings. Be transparent. Step five, build your tribe. Invite everyone watching into a free community.
Engage with them. Learn from them. And step six, repeat consistently. Just keep doing steps three, four, and five until your community clearly tells you they love what you've built and are ready to buy it. The market, it seems, is speaking quite clearly. It wants authentic people solving real problems in the open. The only real question left is, are you listening? Definitely something to think about as you continue your own deep dive into this space. Out to real music.