How agencies can break through the $2 million revenue mark

In Australia, only 7% of businesses ever make it past $2 million in annual revenue. For marketing agencies, that milestone can feel especially elusive. You hustle, win work, build a team, and yet, somewhere around the $1–1.5 million mark, growth slows or stalls. The team is busy, the clients are demanding, and margins start to squeeze. Sound familiar? 

This is the point where many agency founders hit a wall. But it’s not the end of the road, it’s a signal that something needs to shift. In my work with agency owners and other service-based founders, I’ve seen a clear pattern of what holds businesses back, and what helps them push through to that next level of growth. 

Here’s what’s really going on and how to move forward. 

Why agency growth stalls around $1–2M 

At the $1–2M mark, most agency founders are still heavily involved in the delivery side of the business. They’re the rainmaker, the creative director, the strategist and sometimes even the account manager. The business is often built around their reputation, skills, and relationships. For the most part, they prefer it that way as they are reluctant to let go. 

However, this model works up to a point. Once you hit the low seven-figure range, it becomes unsustainable. The founder becomes the bottleneck. Team members don’t have enough autonomy. Clients expect access to ‘the boss’. And every new project adds complexity to an already stretched operation. 

This is not a failure, but it is a challenging phase. Scaling beyond it requires a fundamental shift in how the business is structured and led. 

Jenny Stilwell

Simplify to scale: structure, pricing, and client mix 

Complexity is the enemy of growth. Many agencies find themselves managing too many client types, offering too many services, and reinventing the wheel with every new engagement. This kills efficiency and makes it hard to scale profitably. 

To move forward, agencies need to: 

• Streamline service offerings into clear, repeatable packages that deliver outcomes, not hours. Clients don’t care about what you do, they care about the value and outcomes they receive. 

• Refine the client mix to focus on ideal clients who value strategic input and are willing to pay for it. 

• Price for value, not time. Hourly billing and underquoted retainers erode margins and can create resentment for the founder. 

Agencies that simplify their operations and sharpen their focus, consistently outperform those that try to be everything to everyone. 

The founder-to-CEO transition 

This is the biggest – and hardest – shift. Moving from founder to CEO means letting go of the day-to-day delivery and stepping fully into a strategic leadership role. It takes time. 

This doesn’t mean abandoning your team or clients. It means creating the right leadership structure so your agency isn’t dependent on you to function. It means spending your time on: 

• Business development and strategic partnerships 

• Building the leadership capability of your team 

• Driving long-term growth, innovation, and profitability 

Many agency founders struggle with this transition because they have to shift from expert to leader. It’s a big shift that they typically don’t have any reference points for. But if you want to scale, this is the single most important move you can make. 

Why ‘more clients, more people’ doesn’t work 

It’s a common trap: get more clients, hire more staff to service them, repeat. But this linear approach to growth rarely leads to scalable success. It increases overhead, complexity, and management load without necessarily improving profitability. 

The better alternative is to grow smarter, in a more manageable and profitable way: 

• Maximise the value of each client relationship 

• Improve internal processes and delivery systems 

• Build a high-performing team that can operate without micromanagement 

• Focus on fewer, more profitable accounts with strategic potential 

• Narrow down to a niche rather than searching wide 

• Focus on growing and nurturing existing clients, rather than neglecting them in the primary pursuit of new clients 

Scaling a service business is not about doing more. It’s about doing better. 

Final thoughts 

Breaking through the $2 million mark is absolutely achievable for marketing agencies, but not by doing more of what got you to $1 million. It takes strategic focus, a more efficient operational structure, and a mindset shift from founder to CEO. 

If you’re ready to join the 7% Club, it’s time to simplify, make the strategic shift, and lead differently. 

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topics jenny stilwell Marketing

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