DJ Dart and Kelly Norris started their Web Design Firm, Verrius, in 1999, when they charged all their computer equipment to a credit card. As with most new companies, they started off without a client base upon which they could build the business and generate a recurring revenue stream.
Unlike other companies, Verrius chose not to send letters, do cold calls or go to networking functions to meet clients. Instead, they focused on creating partnerships with existing companies, who then offered Verrius’s Web development and marketing services to their clients.
"These types of businesses typically lack at least one important element in the overall package of services they offer. For these companies, whose reputations rely on offering a complete package of services, Verrius supplies whatever services are necessary without their clients ever knowing we were contracted to step in," notes Dart.
"For example, a software development firm we currently work with lacks an in-house graphic designer. We offer them our services, and the software company benefits from seeming as though they have staff to offer a complete menu of services. The client benefits from dealing with only one contact for everything from soup to nuts, without ever knowing we were instrumental in the process. It’s a winning arrangement for everyone involved."
Finding Partners
When Verrius started out in the Web development industry, it found partners by emailing them and following up with a phone call. "This was a bit of a numbers game, and attracted only a small percent of companies we contacted into our referral network. But persistence prevailed and as the number of partners/clients grew, so did our workload and business," says Dart.
In fact, the tactic turned out to be so successful that Verrius engages in no advertising. Instead, they focus on cultivating their partnerships, which in turn promotes the reselling of their services to their partners clients – clients they would never have reached otherwise.
Setting the Ground Rules for a Partnership
Verrius establishes two types of partnerships, depending on the company they are working with:
1. Reselling services.
"With these deals, we work strictly with the partner and establish a cost for the project. When the project is complete, we bill the partner who, in turn, bills the client, making sure to add a percentage or dollar amount to the project. This allows the partner to earn income on the project," informs Dart.
2. Referrals.
Every referral Verrius receives from one of its partners is rewarded with a commission. The specific amount of the commission depends on the size of the project and the contract they’ve signed with the partner.
Dart says that Verrius prefers to do reseller deals, especially with companies who they’ve dealt with for an extended amount of time. Not only does reselling allow Verrius’s partners to earn more money, but the turnaround on projects is usually much quicker because both Verrius and the partner are already familiar with each others work styles.
Working With Clients
What happens when Verrius wins a project?
"Typically the client/partner remains the primary source of contact and we work behind the scenes. Depending on the contract, the partner may reveal us, or they may wish to keep us concealed and make it appear as if we’re employees of their own business.
It makes the client’s business appear larger and allows the clients to attach fees on top of ours if they wish," says DJ Dart.
The Results
The business became profitable after 3 months, and has stayed profitable since.
Currently, Verrius employs a full-time staff of five: Marketer, Programmer, Web Designer, Graphics Designer, and Copywriter. Business has been so brisk in fact, that on more than one occasion they have needed to bring in additional help from freelancers.
What You Can Learn
It’s not necessary to own clients directly to earn a good income. If you have specialized skills or a great team that other businesses lack, you can partner with them and have them resell your services.
Approach software development firms, Internet marketing firms, ad agencies, and even other Web design companies. You can let them provide a full package of services to their clients, with the work being outsourced to you. They make a profit, they control the client, and you get business without having to go out and "sell".
Relationships with partners are everything. DJ Dart says "We have fun working with our partners, and we typically become friends with them" — which of course means more work and referrals for Verrius!
Matt MickiewiczMatt is the co-founder of SitePoint, 99designs and Flippa. He lives in Vancouver, Canada.
