Founder's Role Shift: Developing People Fuels Agency Scalability

The most significant, yet often overlooked, challenge facing scaling agencies isn't external market forces or client acquisition, but the founder's inability to evolve from "doer" to "developer of people." This conversation with Matt Kovacs of Blaze PR reveals how clinging to operational execution not only creates personal bottlenecks but actively stunts team growth and client experience, ultimately sabotaging scalability. Agencies that understand this fundamental human and structural dynamic--prioritizing team strength before chasing bigger clients--gain a distinct advantage. This insight is crucial for agency founders and leaders seeking sustainable growth, offering a clear path to transform their business from a founder-dependent liability into a robust, team-driven asset.

The Founder's Paradox: Doing vs. Developing

Many agency founders believe the key to scaling lies in acquiring better clients or refining their market positioning. Matt Kovacs, however, argues this is a fundamental misdiagnosis. The real constraint is internal: the founder’s persistent role as the primary executor. In the early days, this hands-on approach is necessary. But as an agency grows, the founder must transition from being the engine of delivery to being the architect of the team and systems that deliver.

Kovacs describes this shift as a willingness to let go. The turning point for him came when the agency achieved a sufficient level of team strength and client quality, creating the necessary space for him to step back from day-to-day execution and focus on strategic oversight, business development, and, crucially, mentoring his staff. This transition is often where founders stall. They attempt to grow while remaining deeply embedded in delivery, leading to bottlenecks in sales, team development, and client relationships. When this happens, growth doesn't break the bottleneck; it amplifies it, creating a cycle of scrambling, neglect, and lost momentum.

"The real constraint is internal: everything still runs through them."

-- Matt Kovacs

This internal bottleneck is precisely why the common belief that "better clients come first" is flawed. Kovacs contends that a stronger team must precede better clients. Without a robust team, larger clients simply increase pressure, expose existing gaps, and force the founder to become even more entrenched in delivery, trapping the agency rather than elevating it. This leads to the familiar agency "rollercoaster": landing a big client, struggling to deliver, neglecting other areas, and then losing momentum. The correct sequence, Kovacs emphasizes, is Stronger team → better client experience → higher-quality clients. This requires a founder to shed the operator mindset and embrace the role of an architect.

The Hidden Cost of Stagnation: The $1M-$3M Plateau

The consequence of a founder remaining stuck in the "doer" role is profound and often leads agencies to plateau between $1 million and $3 million in revenue. While revenue might be present, the underlying structure is often weak, and the agency is busy but not truly scalable. The founder, in this scenario, becomes the most expensive and least scalable resource in the business.

Kovacs’ approach to leadership is rooted in a deep understanding of people. He views managing a team not as a one-size-fits-all endeavor but as a nuanced practice requiring an awareness of individual motivations. Some team members thrive on daily interaction, others need autonomy, and different individuals respond to recognition versus responsibility. This level of insight separates effective leaders from mere managers. The fundamental shift, however, is recognizing that the founder's job evolves from producing work to developing people.

An example of this principle in action occurred when Kovacs allowed a junior team member, who had developed deep expertise in Indigenous relations through personal passion, to lead a critical part of a major pitch. Instead of controlling the outcome, Kovacs created space for her to step up. The agency won the account, but more importantly, this act strengthened the entire organization. When founders hoard control, they limit their team’s potential. By creating opportunities for others to lead, they expand the agency’s capacity without necessarily increasing headcount.

"the founder's job becomes developing people, not producing work."

-- Matt Kovacs

The AI Amplification Effect: Systems First, Tools Second

The conversation also touches on the integration of Artificial Intelligence. Kovacs’ team approaches AI cautiously, implementing guardrails, review processes, and intentional usage. AI is viewed as a tool to enhance output, not replace critical thinking. This perspective is crucial because AI amplifies existing systems. If an agency is chaotic, AI will accelerate that chaos. Conversely, if an agency is well-structured, AI becomes a powerful force multiplier.

This distinction explains why some agencies will compress timelines, increase margins, and outpace competitors with AI, while others fall further behind. The difference lies not in the tool itself but in the underlying operating model. Agencies that have robust systems and strong leadership will find AI enhances their capabilities. Those without these foundational elements will find AI exacerbates their existing weaknesses. The implication is clear: AI is not a shortcut to scalability; it’s a powerful accelerant for agencies that are already built for growth.

Navigating the RFP Cattle Call

The discussion around RFPs highlights another area where conventional wisdom often fails. Kovacs and Swenk both express a strong aversion to RFPs, viewing them as often unproductive "cattle calls" that consume significant resources without a guaranteed return. Kovacs admits to doing only one or two per year, and only after careful consideration and pitching the opportunity internally to his team. The decision to pursue an RFP is based on criteria like existing experience, potential upside, and alignment with team passion, rather than simply the prospect of new business.

Swenk shares a similar sentiment, advocating for strategy sessions with potential clients who present RFPs, charging for this consultative work, and often winning deals through this more targeted approach. The consensus is that RFPs are generally a waste of time unless there's a pre-existing connection or a willingness from the client to pay for the strategic thinking involved. The shift towards more organic introductions and trusted referrals signifies a move away from the RFP-driven model, emphasizing relationships and proven capabilities over speculative proposals.

• Prioritize Team Development Over Client Acquisition: Recognize that a strong, capable team is the prerequisite for attracting and retaining high-quality clients. Focus on building internal capacity before chasing larger accounts.
• Evolve Your Role from Doer to Developer: Actively shift your focus from executing client work to mentoring, coaching, and empowering your team. This requires a conscious effort to delegate and trust.
• Implement Structured Team Engagement: Since organic, informal interactions are less common, proactively schedule and structure opportunities for team connection, collaboration, and skill-sharing, even if it’s through in-person events a few times a year.
• Embrace AI as a System Multiplier, Not a Fix: Integrate AI tools thoughtfully, with clear guardrails and review processes. Understand that AI amplifies existing operational strengths or weaknesses.
• Be Highly Selective with RFPs: Treat RFPs as strategic opportunities, not obligations. Develop strict criteria for pursuit and consider charging for the strategic work involved in responding.
• Invest in Understanding Your People: Dedicate time to understanding individual team members' motivations, communication styles, and development needs to foster a more effective and appreciated workforce.
• Develop "New Markers" for Experience: As the agency evolves, create new reference points for team members to understand historical context and strategic decisions, moving beyond outdated timelines.

Key Quotes

"The real constraint is internal: everything still runs through them."

-- Matt Kovacs

"better clients come after a better team, not before."

-- Matt Kovacs

"If your agency is chaotic, AI makes it faster chaos."

-- Matt Kovacs