Thriving In A Tough Economy: How To Start And Succeed With Your Design Agency As A Small Business

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00:00:42.000 | You're listening to Let's Talk Jobs,

00:00:45.320 | where we give you practical insights into jobs and careers.

00:00:48.360 | Today, we're talking about building

00:00:49.800 | your own international creative agency,

00:00:51.560 | and joining us is Andre Oliveira.

00:00:53.080 | Andre, how you doing?

00:00:54.160 | - Hey Tim, doing well and you,

00:00:57.400 | thank you so much for having me.

00:00:59.360 | - Yeah, you know, you and I have worked a lot in the past,

00:01:02.400 | but maybe just get us started,

00:01:03.440 | like what is it you're doing,

00:01:04.640 | and what are you doing at Pixel Matters?

00:01:06.600 | - Yeah, so we are a digital product studio.

00:01:10.680 | We basically partner with tech companies

00:01:13.800 | from all over the world,

00:01:15.360 | but especially U.S. based to basically

00:01:20.360 | to elevate their products into a whole new level,

00:01:23.480 | being a website, a web app, or a mobile app.

00:01:27.360 | And yeah, we have been doing it for 10 years now.

00:01:30.760 | We are roughly a team of 60,

00:01:32.960 | we try to differentiate ourselves

00:01:41.680 | by the level of quality of the work,

00:01:45.000 | and process, and communication that we have,

00:01:48.160 | and our culture around all of those things.

00:01:51.800 | - Cool, and I probably should have introduced

00:01:53.640 | even better earlier,

00:01:54.480 | you're the CEO and founder of Pixel Matters,

00:01:56.640 | and Andrei, I'm kind of curious,

00:01:59.360 | did you, were you always creative?

00:02:01.720 | Like coming out of school, like what led you here?

00:02:05.560 | - Yeah, so to answer that,

00:02:10.200 | I maybe have to go back to my roots.

00:02:14.400 | So I don't know about,

00:02:16.200 | I'm not sure how it is in the U.S.,

00:02:18.040 | but here in Portugal, where I'm from,

00:02:20.880 | and where we are based,

00:02:24.640 | when you are at the ninth grade,

00:02:28.080 | and before you switch to the 10th,

00:02:30.280 | you have to basically pick like a course, right?

00:02:34.160 | Like something to study.

00:02:36.640 | And back then, as the majority of the kids of that age,

00:02:40.880 | maybe 14, 15, something like that,

00:02:43.800 | I really didn't knew what I wanted to do for my life.

00:02:48.800 | Like I was too young,

00:02:52.280 | and sometimes school doesn't necessarily

00:02:56.320 | like gives you a good indicator of what your path may be.

00:03:01.280 | So the only thing that really I valued back then

00:03:05.040 | was the fact, or I highlighted back then,

00:03:07.720 | was the fact that I had like a whole computer

00:03:12.000 | in which I played some games like Counter-Strike.

00:03:15.400 | - Oh yeah.

00:03:16.240 | - Call of Duty, things like that, you know?

00:03:18.320 | - Yes.

00:03:19.200 | - And so it felt like, I'm not studying informatics.

00:03:22.720 | And I went on to study informatics.

00:03:25.760 | I did the 10th grade of informatics,

00:03:30.480 | but the problem was that it had too much code.

00:03:34.520 | Like, and it was too much math to my brain,

00:03:39.520 | let's call it that way.

00:03:44.040 | And so I switched to a multimedia course,

00:03:48.920 | not because I knew what I wanted to do,

00:03:51.120 | but simply I had a friend that switched to that same course,

00:03:55.160 | and I wanted like to keep studying with that friend.

00:03:58.520 | So these are like the, I mean,

00:04:01.360 | there is luck along the way, right?

00:04:04.480 | Of course, there is a lot of hard work,

00:04:06.720 | but there is also some luck,

00:04:08.600 | and this is an example of that.

00:04:10.960 | And so with that multimedia course,

00:04:13.600 | what I basically found out was my passion.

00:04:16.240 | And my passion was clearly, and still is to this day,

00:04:21.240 | like the digital design, like UX, UI in particular.

00:04:26.760 | So I really try to specialize

00:04:30.720 | and to know as much as I possibly could about that.

00:04:35.120 | And so after a period of unemployment after the school,

00:04:40.920 | I eventually found out my first job, my second job.

00:04:44.400 | Then I started working as a freelancer,

00:04:46.840 | like and I received some inquiries via Dribbble,

00:04:51.240 | BS, and websites of that kind.

00:04:54.160 | And one day the inquiries started to pile up,

00:04:58.440 | like then referrals, like a client brings another client,

00:05:03.320 | a client brings another client.

00:05:05.440 | And so before I could even think twice about it,

00:05:09.760 | I have an open business and I have like people working

00:05:14.480 | with me in my apartment.

00:05:18.200 | So I'm trying to consolidate it

00:05:22.360 | as in the most succinct way I possibly can.

00:05:26.680 | - Yeah, you know, that's very consistent actually

00:05:29.360 | with even my impression of you,

00:05:31.280 | 'cause you're talking about building relationship through,

00:05:33.800 | I mean, building business through relationships, right?

00:05:35.480 | And through referrals.

00:05:36.480 | And that's exactly the first impression I had with you

00:05:39.680 | as well, like your strength in building relationship

00:05:43.360 | with clients through good work and building rapport

00:05:47.240 | and honesty is really, I feel like what differentiates you

00:05:50.320 | with a lot of the other, even at an individual level,

00:05:54.080 | not even just at a company level, like you as an individual,

00:05:56.760 | 'cause a lot of times we engage with a service provider

00:06:00.480 | or whatever, based on the first interaction

00:06:02.760 | with the first rep, right?

00:06:04.040 | And that individual carries with them the burden

00:06:06.880 | of representing the whole brand.

00:06:08.040 | And if that's a bad experience,

00:06:09.560 | you kind of don't wanna do work with them.

00:06:11.720 | So can you help me understand?

00:06:13.840 | So all right, you got folks in your living room

00:06:16.360 | and taking the leap from that to, I guess,

00:06:18.680 | incorporating or creating Pixel Matters,

00:06:21.040 | like did you have the name Pixel Matters

00:06:24.160 | or did it come afterwards?

00:06:25.680 | Like how did this all come about?

00:06:27.320 | - No, we have the name Pixel Matters

00:06:31.080 | from the very beginning.

00:06:32.320 | So I have a friend that started the business

00:06:35.440 | with me in the early days.

00:06:37.720 | He left in the meantime,

00:06:39.200 | but the company was incorporated as like a 50/50.

00:06:43.560 | And back then, I remember we were just like brainstorming

00:06:47.040 | on Skype.

00:06:48.200 | This is like 2012 or 2013, something like that.

00:06:53.200 | And we were like combining words, you know?

00:06:59.880 | And there was a moment in which we combined Pixel Matters

00:07:03.720 | and we both felt, oh, this one will be amazing.

00:07:07.760 | And I remember Googling and because I was expecting

00:07:12.480 | like something to exist with the name Pixel Matters,

00:07:15.960 | to my like surprise, nothing existed.

00:07:19.640 | And we were like, okay, this is it.

00:07:22.040 | This is the name, let's go for it.

00:07:24.560 | We opened it up the entity on December 17, 2013.

00:07:32.360 | And the motivation for it was the fact

00:07:35.280 | that we have a big client that appeared

00:07:40.280 | into our front door, a client from Ghana.

00:07:45.800 | It was the only client ever we ever had from Africa,

00:07:50.320 | but it was clearly an important one

00:07:53.560 | in which we basically estimated the project

00:07:56.560 | into like 20K or 25K,

00:08:00.120 | which was like an enormous amount of money.

00:08:03.160 | And none of us were like comfortable to receive

00:08:06.880 | that amount into our own personal bank accounts

00:08:10.120 | without like a proper justification, you know?

00:08:14.040 | And so that was like the catalyst,

00:08:17.800 | let's call it that way, to open up the entity.

00:08:22.240 | And from that point onwards, yeah,

00:08:26.760 | the business just kept on evolving like organically.

00:08:31.120 | We are completely different from the usual companies

00:08:35.320 | that we work with as our clients

00:08:37.360 | and the companies that you work with

00:08:40.560 | at least in the recent years as well,

00:08:42.960 | in the sense that we are like old fashioned, you know?

00:08:46.480 | It's like, I own 100% of the business.

00:08:49.320 | We have no investors.

00:08:50.720 | We are profitable nearly every month,

00:08:54.040 | otherwise like there will be no business.

00:08:56.520 | And so it's a simple structure from that perspective.

00:09:01.520 | I don't know if I answered your question.

00:09:05.520 | - No, you did, yeah.

00:09:06.640 | Yeah, you know, I don't know if I ever told you, Andre,

00:09:09.400 | I've always really liked the name Pixel Matters

00:09:11.520 | because I have, so as a digital marketer,

00:09:13.880 | I have a very specific phrase

00:09:15.480 | I use almost at every single job I join,

00:09:18.040 | and that is that every pixel has to have a purpose.

00:09:21.760 | You know, like- - There you go.

00:09:23.240 | - Coming from the agency side,

00:09:25.600 | clients are always saying,

00:09:26.440 | "Oh, build it like Apple, build it."

00:09:27.840 | It's like, yes, Apple has a wonderful site.

00:09:29.720 | It's true and it's beautiful.

00:09:31.360 | There's a lot of analytics behind that

00:09:33.840 | which you don't have visibility into.

00:09:35.040 | So just copying it, you know,

00:09:37.480 | or Stripe, beautiful website as well.

00:09:39.440 | You just can't copy it

00:09:40.840 | if you don't know what's really working

00:09:42.160 | 'cause you don't have the data.

00:09:43.000 | And so like, you can't just arbitrarily

00:09:44.760 | throw colors on a page.

00:09:45.640 | So yeah, for me, it's like every pixel

00:09:48.000 | has to be put there intentionally.

00:09:49.600 | If it's not, get it out of there. (laughs)

00:09:51.960 | - Yeah, yeah, yeah.

00:09:52.800 | No, I don't remember you saying that,

00:09:56.640 | at least not in that way.

00:09:58.080 | So yeah, yeah, thanks, appreciate it.

00:10:01.640 | But yeah, indeed, Modesty aside,

00:10:05.280 | it's really a name that has served us well

00:10:09.600 | because it kind of facilitates the pitch.

00:10:13.880 | Like the company name kind of says

00:10:16.280 | like 75% of the whole idea we want to convey

00:10:22.360 | to a potential client.

00:10:24.680 | So yeah, so just to touch on the relationship point,

00:10:29.040 | because I missed that part just a while ago,

00:10:33.600 | that is to say that, I mean,

00:10:35.400 | I'm glad that that's something that comes across,

00:10:39.240 | at least for someone like you

00:10:40.800 | that has worked with us in the past,

00:10:42.720 | because I think that at the very foundation of that

00:10:47.720 | is a relatively simple like idea and concept,

00:10:52.560 | which is the fact that we,

00:10:55.200 | like I never propose of myself to create a company

00:11:01.280 | or in this case, an agency,

00:11:04.400 | just for the sake of like billing man hours, you know?

00:11:09.040 | I did it with the intention to try to do work

00:11:12.360 | that really has an impact on the client business,

00:11:17.160 | in whatever form that may be,

00:11:21.000 | but to really have an impact

00:11:22.640 | instead of just doing it for the sake of doing it

00:11:26.200 | or doing for the sake of receiving

00:11:28.120 | some financial upside in exchange.

00:11:33.000 | And because of that, even when you aren't the client yet,

00:11:37.600 | like even if you are a lead,

00:11:39.600 | our approach is always like help first,

00:11:43.560 | sell secondly, you know?

00:11:45.680 | So the sale is always like secondary.

00:11:49.200 | And because, I mean, to me,

00:11:52.280 | that is the only way in which it makes sense,

00:11:56.000 | always with the mindset of like playing the long game

00:12:00.960 | instead of like looking for short-term gains.

00:12:04.840 | - Yeah, you know, I'm kind of wondering,

00:12:07.280 | so you're uniquely positioned in this call,

00:12:10.440 | I see amongst everyone I've talked to so far,

00:12:12.600 | because you are an international firm, right?

00:12:15.360 | Because everyone I've been speaking to so far

00:12:17.040 | has been very stateside.

00:12:18.920 | And when we're evaluating design partners or whatnot,

00:12:23.480 | like especially in today's climate,

00:12:24.920 | like budget becomes a really important thing.

00:12:26.760 | And so if it's not an internal headcount,

00:12:30.240 | choosing to do business with a stateside firm

00:12:35.200 | could be an expensive prospect, right?

00:12:37.320 | And usually the argument for staying stateside is like,

00:12:41.880 | oh, you know, maybe they're in the same time zone

00:12:44.600 | or whatever it is, or maybe they're close to us

00:12:46.160 | and do in-person meetings.

00:12:47.440 | But I'm finding that that reason

00:12:50.560 | is starting to become a lot less important than cost,

00:12:54.280 | only 'cause in this climate right now,

00:12:56.200 | like companies are just struggling,

00:12:57.840 | they're just trying to stay alive

00:12:59.000 | 'cause the economy is so crazy.

00:13:01.480 | So it's opened the door more

00:13:03.360 | to working with international firms.

00:13:05.280 | So I'm kind of curious on your side,

00:13:07.480 | like how do you,

00:13:09.680 | I think building relationships obviously is one way

00:13:11.680 | of kind of creating state US-based customers,

00:13:15.400 | but is that an intentional strategy of yours?

00:13:18.280 | Is the majority of your customers

00:13:19.800 | still based out of Portugal?

00:13:21.320 | And what are the challenges you faced?

00:13:24.200 | Time zone is probably one of them,

00:13:26.520 | but working with customers who are not in Portugal,

00:13:29.880 | not local, what challenges do you face?

00:13:32.880 | - Like historically, roughly 90 to 90% of our revenue

00:13:41.040 | comes from US-based companies.

00:13:43.520 | So we do have a few local like Portuguese clients,

00:13:47.400 | but we are talking about like 5 to 10% in annual revenue

00:13:52.400 | over all these years.

00:13:54.480 | So it's not very relevant.

00:13:57.240 | So yeah, we have been dealing

00:14:00.640 | with this kind of remote collaboration for 10 years now.

00:14:07.160 | I think the value prop that we try to offer to our clients,

00:14:12.160 | and actually I've been on a call with a lead,

00:14:14.960 | like a potential client that said this almost

00:14:19.200 | with using the same exact words,

00:14:22.040 | which is we try to position ourselves in a way

00:14:25.760 | that we provide a value of the same level of quality

00:14:30.760 | that the US-based agency does,

00:14:33.720 | but for a fraction of the cost.

00:14:36.600 | While not being the cheapest option

00:14:39.600 | that you find like in the market, right?

00:14:41.760 | Because obviously the cost of living

00:14:45.240 | and the cost of employment and goods and whatever in Portugal

00:14:49.920 | is quite different from other places in the world.

00:14:54.280 | So, and we don't want to compete in price anyway.

00:14:57.800 | So that's the kind of sweet spot

00:15:00.560 | that we try to position ourselves.

00:15:04.640 | - In addition to this, I would say that the pandemic

00:15:09.640 | and the change that happened in the work paradigm

00:15:14.440 | really, really made the difference.

00:15:16.200 | Because what I found these days is that

00:15:18.760 | everyone is kind of distributive anyways, you know?

00:15:24.880 | So very few companies are like office driven

00:15:28.880 | like they were before the pandemic,

00:15:31.240 | especially the bigger ones.

00:15:32.880 | Like the bigger you are, the harder it gets

00:15:35.520 | to have an approach to that kind.

00:15:38.600 | So everyone is already like deal,

00:15:42.680 | user to deal with the time zone difference,

00:15:46.000 | the need for a sync communication,

00:15:48.680 | the need to have like documented processes

00:15:52.080 | or, you know, like some basics

00:15:55.040 | for a remote collaboration to go well.

00:15:59.240 | That partnering with someone that is overseas,

00:16:03.520 | that is indeed on a different time zone,

00:16:06.320 | it's really not something that like matters

00:16:10.920 | as long as the work is done and with quality

00:16:14.920 | and the relationship is good.

00:16:16.760 | So that's what I find.

00:16:19.480 | That doesn't mean that we are not feeling the impact

00:16:22.640 | of the current market.

00:16:23.960 | Those are two different things because yeah,

00:16:26.440 | things are wrong out there.

00:16:29.240 | - Yeah, I mean, I definitely wanna talk

00:16:30.640 | about surviving the pandemic,

00:16:32.360 | but before I get there, I'm kind of curious, you know,

00:16:35.040 | you said something that I didn't even think about,

00:16:36.920 | which is, you know, the community that you work with,

00:16:41.600 | they're either a custom or have experience working

00:16:45.560 | with very remote, different time zone customers, right?

00:16:49.760 | And so I was wondering, you know,

00:16:52.400 | because the time zones are so different,

00:16:53.760 | oftentimes I'm working with, for me, an offshore team,

00:16:56.760 | the value of not having the same time zone

00:17:01.520 | is by the time you get into work,

00:17:03.240 | the work that you need to get completed is already done,

00:17:05.400 | right? - Yeah, yeah, yeah.

00:17:06.640 | - But then there's always time for feedback.

00:17:08.240 | And depending on the resource type, right?

00:17:11.720 | Like design, it's more, you can mostly package and hand off,

00:17:16.720 | but like when we're doing development work,

00:17:19.360 | sometimes that requires us to be online

00:17:22.560 | at the same time, right?

00:17:23.600 | And so, is it hard for you to, you know,

00:17:28.280 | find the resources who are willing to work

00:17:30.480 | like US-based hours or how do you meet the middle?

00:17:34.520 | - I mean, I guess we are lucky in the sense

00:17:41.640 | that all of our team is in Portugal

00:17:46.160 | and we in Portugal are in a very like central place

00:17:49.960 | of the world and like looking at the US,

00:17:54.720 | even if you are in like California, like you are,

00:17:58.840 | we still manage to have at least a daily overlap

00:18:02.960 | of time of two to three hours.

00:18:05.640 | And not only because of the time zone difference,

00:18:08.520 | but also because the fact that usually like Americans

00:18:13.200 | like yourself get up like quite early,

00:18:16.120 | which is for us great because if you got out of bed

00:18:20.760 | at 10 a.m., things will be different.

00:18:24.440 | So I guess with the combination of luck,

00:18:27.880 | which is the context that I just described

00:18:30.280 | and the fact that we have a process that is very well oiled,

00:18:34.360 | we have the right communication tools in place,

00:18:38.400 | things just work well.

00:18:41.320 | And I can tell you that apart from a few exceptions

00:18:44.920 | over the years, we never felt the need, for example,

00:18:48.240 | to adjust our schedule to, let's imagine like having

00:18:53.160 | our team starting to work at 11 in the morning

00:18:56.840 | or noon or something like that.

00:18:59.720 | That never happened simply because like

00:19:04.720 | it was never needed, right?

00:19:06.160 | So the only thing that happens is like, okay,

00:19:09.480 | today's lunch day or there is something important,

00:19:14.000 | let's, we stay longer through the day

00:19:17.320 | or we wake up earlier or whatever it may be.

00:19:21.720 | But always with good sense and looking at what's best

00:19:26.720 | for the challenge that is in front of us.

00:19:31.080 | - Yeah, I'm kind of wondering, beyond the client side,

00:19:35.320 | I've seen a shift post-pandemic around the need

00:19:40.320 | to demonstrate ROI for every dollar spent, right?

00:19:43.600 | And that manifests itself in different ways, right?

00:19:48.440 | For someone like me, who's come from the agency side,

00:19:51.120 | I have a little more empathy of the process

00:19:53.360 | that you go through.

00:19:54.200 | And so when it comes to prioritizing the work

00:19:57.680 | and working with a partner like you,

00:19:59.280 | like I do a lot of upfront work to make sure

00:20:01.600 | you're set for success, which sets me up for success.

00:20:04.240 | But I don't see that all across the board.

00:20:07.200 | I see a lot of frantic planning,

00:20:12.280 | where budgets are cut.

00:20:14.640 | Now you need to squeeze as much as you can out of it.

00:20:17.400 | And from what I observed, and this is not just,

00:20:19.360 | and not my current company, but my previous companies,

00:20:22.480 | and actually from stories I hear from other friends as well,

00:20:26.160 | is that because you demonstrate that ROI,

00:20:30.000 | the focus of what you send the agency partner down

00:20:35.240 | becomes more vague.

00:20:36.680 | They just ask a lot, ask a lot, ask a lot,

00:20:39.360 | trying to squeeze as much lemonade out of the lemons,

00:20:42.800 | which is a decreasing budget.

00:20:45.200 | Have you noticed that shift as well,

00:20:47.080 | in terms of how clients work with you,

00:20:50.080 | how they speak to you?

00:20:51.840 | Do you feel like you're treated more

00:20:53.160 | as a commodity now than before?

00:20:55.120 | Or anything of that nature?

00:20:57.680 | - That's an interesting question.

00:21:02.840 | I think the change that we have felt,

00:21:09.200 | timing-wise, was not in the pandemic.

00:21:11.880 | So basically what we felt in the pandemic

00:21:15.000 | was like a V recovery,

00:21:19.120 | in the sense that in March 2020, April 2020,

00:21:23.360 | the world was in shock, and everyone went crazy,

00:21:27.880 | and there was like a stock market crash,

00:21:30.880 | and everyone was like, what the hell is this thing?

00:21:33.800 | And now we have to be closer at home.

00:21:36.080 | And so there was like a panic going on.

00:21:39.920 | But immediately afterwards,

00:21:41.920 | what followed was like a growth

00:21:46.480 | in all companies that have like a digital offering

00:21:51.480 | of something that is usually done offline,

00:21:55.480 | like online education.

00:21:57.840 | Even Zoom, where we are right now,

00:22:00.000 | grew like crazy over the months that followed,

00:22:04.280 | because suddenly every grandma in the US

00:22:08.000 | was doing a Zoom call with their kids

00:22:10.680 | almost on a daily basis.

00:22:12.600 | And so it was like a drop, and we felt that,

00:22:16.440 | but the market recovered very rapidly,

00:22:20.880 | and 2021 and 2022 have been like way better years

00:22:25.880 | from a financial and economic standpoint in tech,

00:22:31.760 | not necessarily in the rest of the world,

00:22:33.880 | but in tech it was...

00:22:35.720 | In fact, in 2021, at least that's my reading,

00:22:40.720 | it was like the top of the bubble

00:22:45.560 | that exploded in the meantime.

00:22:49.520 | So that said, what I think that really changed

00:22:52.520 | was like in late 2022, early 2023,

00:22:56.160 | where the tech market correction really started

00:22:59.400 | to be felt and all the layoffs,

00:23:03.080 | and I mean, all those things,

00:23:06.320 | that's where what you just described

00:23:10.400 | really started to play a big part

00:23:13.800 | at the negotiation table.

00:23:16.280 | Like, I'm not sure if the right way to put it is ROI.

00:23:26.120 | To me, it's more like the money is no longer cheap,

00:23:31.120 | and so therefore the cost of a dollar

00:23:36.120 | is way bigger than it was before.

00:23:39.920 | And so companies, even though they still have the cash,

00:23:44.920 | they don't have like the openness to invest that cash,

00:23:49.760 | and it's way harder to get those budgets

00:23:55.920 | to be invested on whatever it may be.

00:24:00.440 | In our case, it's a service.

00:24:03.040 | So definitely like a big change

00:24:06.920 | and really, really challenging times right now

00:24:10.600 | that I think everyone in the industry is feeling,

00:24:14.640 | and we are not an exception.

00:24:17.400 | Regarding us being like a commodity,

00:24:23.920 | I think that part, it's not really something

00:24:27.960 | that I can say that, yes, we felt that, no,

00:24:31.960 | because the type of service that we provide

00:24:37.040 | is usually very attached

00:24:39.280 | to the long-term success of the business.

00:24:43.640 | I will give like a simple example.

00:24:46.440 | Let's say that we are working on the revamp of your product,

00:24:53.440 | like your company has a very outdated product,

00:24:56.320 | users complain, or they don't understand how to use it,

00:24:59.520 | so there are UX problems, your UI is a complete mess,

00:25:04.520 | you have no like digital identity, right?

00:25:07.040 | And so there is a need to clean all that up.

00:25:10.320 | In the tech front, like your backend is a mess

00:25:15.320 | or your frontend is completely outdated,

00:25:18.800 | and there is a need to revamp everything.

00:25:20.440 | And so when we are working on those type of projects

00:25:24.600 | that are so close to the heart of the business,

00:25:27.920 | definitely we are not like a commodity,

00:25:31.680 | and that's where we feel like we want to,

00:25:34.880 | we are more valuable at,

00:25:37.720 | and that's where our clients value us the most.

00:25:41.560 | When we are working on something

00:25:43.440 | that is like more like a side priority to the business,

00:25:49.520 | that's where usually the sentence comes,

00:25:52.720 | something in the line of,

00:25:54.440 | "Oh, Pixelmatrix is the most expensive line item

00:25:57.520 | "I have on my spreadsheet,

00:26:00.040 | "so I have to cut somewhere, it will be on you."

00:26:03.920 | So that's more or less how I would put it.

00:26:10.840 | But it will be very interesting to listen

00:26:14.400 | also what you think about these changes.

00:26:18.440 | - You know, it's interesting to me your last statement,

00:26:23.280 | which is Pixelmatter is being the most expensive line item,

00:26:27.600 | that hasn't been my experience

00:26:29.480 | with your agency in particular.

00:26:31.760 | So typically, just for everyone out there, right?

00:26:34.440 | When you're, there's always the three factors

00:26:39.040 | of like speed, quality, cost.

00:26:43.600 | And the rule of thumb is you usually can't have all three.

00:26:45.960 | You can have two at the sacrifice of one, right?

00:26:47.840 | So you can have speed and cost, but quality could be down.

00:26:52.840 | Or you can have, take your time with high quality,

00:26:56.600 | but the cost would be high, right?

00:26:58.960 | But like Pixelmatter is in my experience,

00:27:01.080 | and this is a huge kind of shout out to you guys,

00:27:03.040 | you somehow, in my mind, managed to achieve all three.

00:27:07.280 | Meaning the cost compared to the rates

00:27:11.160 | of US-based companies is advantageous, right?

00:27:15.880 | The quality of output is always really, really good.

00:27:20.360 | And you somehow deliver it quickly.

00:27:22.920 | I remember in the past when evaluating vendors,

00:27:26.880 | all the time working with you even,

00:27:28.160 | or trying to bring you on as I move companies myself,

00:27:31.120 | what I've discovered is rate for rate

00:27:35.800 | versus quality of talent,

00:27:38.400 | that's where you start feeling the difference, right?

00:27:39.920 | Like if you try and compare to a US-based company,

00:27:42.720 | and they try to match the rate that you guys are doing,

00:27:45.440 | because you're offshore, it's about location, right?

00:27:48.920 | Now you're comparing a junior talent

00:27:50.200 | versus a mid to senior level talent, just based on budget.

00:27:53.880 | So for me, choosing not to do business with Pixelmatters

00:27:58.200 | isn't because you're the most expensive line item.

00:28:01.000 | What I'm experiencing now is just spending money at all.

00:28:04.640 | - I have.

00:28:07.440 | - Yeah, like I come in with an envelope

00:28:10.280 | that was healthy this year, and I was like, oh, cool.

00:28:13.200 | I have a budget spent last year.

00:28:15.880 | The budget's flat year over year.

00:28:17.400 | I just got to spend it again.

00:28:19.200 | My team overachieved last year.

00:28:21.400 | So far, it's looking like it's doing that again.

00:28:24.160 | So I was like, cool, like conventional wisdom would be like,

00:28:27.680 | let me just at least invest in the same areas,

00:28:31.040 | and maybe it'll grow, or maybe, or whatnot.

00:28:33.840 | But I'm finding right now that even though I have a budget,

00:28:39.040 | getting it approved to be spent is something else.

00:28:43.400 | And even if I come to the table and say,

00:28:47.120 | hey, look, I have all the metrics to prove ROI on the spend,

00:28:51.600 | why it's strategically aligned to the business priorities,

00:28:54.640 | as well as my own organization's priorities and the yield,

00:28:58.360 | even then it's a tough sell.

00:28:59.760 | And I can understand.

00:29:01.320 | The trade-off is, are you gonna spend 50K

00:29:05.640 | in one area of the business,

00:29:06.840 | or is that gonna go towards keeping someone's employed?

00:29:10.920 | So I understand the trade-offs that companies make,

00:29:14.400 | as well as protecting company value and stock price.

00:29:17.320 | So I get that, but the climate is just so weird, man.

00:29:20.520 | And there's things that are just table stakes

00:29:22.440 | that I would think should be a no-brainer,

00:29:24.560 | and it's just requiring a little bit more scrutiny than usual.

00:29:27.560 | - Yeah, I mean, I'm happy to listen to what you just said,

00:29:34.120 | and I think it will be interesting for folks

00:29:36.520 | that are listening to this,

00:29:38.320 | especially folks that are on my shoes.

00:29:41.320 | And I know that because of all the community local

00:29:45.520 | that I have, there will be, for sure,

00:29:47.280 | a lot of other founders from agencies

00:29:49.440 | that will listen to the pod,

00:29:51.160 | because what you just described

00:29:53.600 | is exactly what I'm feeling.

00:29:57.280 | The money is there.

00:29:58.760 | The willingness to spend the money doesn't exist,

00:30:02.120 | which is what you just said.

00:30:05.080 | And so it's a very weird moment in time,

00:30:10.080 | because you question yourself,

00:30:15.400 | what can you do to change things around

00:30:18.920 | and to start to close lids and all of that?

00:30:21.560 | And it's tough, because even if you arrive

00:30:27.440 | into the front door of the right clients,

00:30:31.320 | if they aren't willing to invest

00:30:34.360 | and to spend the money, what can you do?

00:30:38.400 | So I don't know if you have any tips for me,

00:30:41.440 | but it feels a bit, yeah,

00:30:46.120 | I'm not sure what to do regarding that,

00:30:49.600 | other than keeping investing in the quality of the work,

00:30:53.640 | the processes, the team, the brand,

00:30:55.840 | and preparing ourselves for a recovery.

00:30:59.480 | - Yeah, the path I'm taking right now,

00:31:03.120 | and you're a part of this journey as well,

00:31:04.800 | 'cause you and I obviously we talk a lot

00:31:06.760 | and you were sounding board for one another,

00:31:09.000 | or trying to create opportunity with each other.

00:31:12.080 | I came in this year with the original thought

00:31:14.440 | that, hey, I can just translate my budget year over year.

00:31:16.880 | And so it was a large line item,

00:31:18.880 | and it was quickly dismissed.

00:31:21.120 | So I'm doing a different method now,

00:31:22.800 | where it's like, I need to prove, first of all,

00:31:25.240 | that I'm maximizing utilization of internal resources,

00:31:28.080 | 'cause that's gonna be the very first things

00:31:29.560 | that come to mind.

00:31:31.080 | We have designers in-house,

00:31:32.440 | we don't want them to be impacted,

00:31:34.080 | so make sure they're fully utilized,

00:31:36.120 | even if it's utilized in a way

00:31:37.880 | that falls outside their comfort zone, right?

00:31:40.240 | They're a designer,

00:31:41.240 | they're not typical UX/UI web designers,

00:31:44.200 | but can you make it work?

00:31:45.360 | And as a leader, I need to figure out

00:31:47.080 | where that skillset can fit in

00:31:49.760 | without negative impacting anybody.

00:31:52.840 | So my approach now, and I'm still working on it, Andre,

00:31:55.920 | is going the other way around,

00:31:58.200 | which is like, let's start small.

00:32:02.280 | And small means different things

00:32:03.720 | to different businesses, right?

00:32:04.640 | For startups, small could be a $5,000 engagement.

00:32:07.720 | For a large company, small could be $50,000 or more.

00:32:10.160 | It's totally different.

00:32:11.400 | But the idea is like taking something,

00:32:14.920 | maybe like two or three key priority projects,

00:32:18.400 | and just starting there to prove value, right?

00:32:21.000 | And so that's what I'm trying to do now,

00:32:22.840 | and it's across the board,

00:32:25.720 | whether it's a technology investment,

00:32:27.560 | or a service investment,

00:32:28.840 | I'm just trying to get it in there.

00:32:30.800 | And once the spend is in there,

00:32:33.400 | you're in the system, and you're proving work,

00:32:36.760 | people can then see, right?

00:32:39.000 | So again, it's just a different model.

00:32:40.400 | And in this case, it's bringing on a new relationship,

00:32:43.200 | like I'm actively talking to you,

00:32:45.240 | trying to see if we can do some work, right?

00:32:47.520 | But even with existing vendors,

00:32:48.920 | it's surprisingly going through the same level.

00:32:51.920 | - Yeah, yeah, yeah.

00:32:53.640 | Yeah, I also felt that right now,

00:32:57.000 | I'm not feeling that very heavily,

00:32:59.920 | but with like the boom of AI,

00:33:03.360 | and I mean, of course,

00:33:05.480 | ChatGPT has been like the key milestone,

00:33:09.720 | but obviously a lot more has been happening,

00:33:13.800 | and being launched ever since.

00:33:16.880 | I also felt that like the expectations from clients

00:33:22.000 | regarding how much time things take to be done,

00:33:26.200 | really like changed dramatically on, not right now,

00:33:31.200 | I think now things are a little bit more stabilized,

00:33:35.440 | and everyone kind of realized that AI,

00:33:38.240 | at least for now, won't do all the work for you.

00:33:42.520 | But in the, like half a year ago, or something like that,

00:33:46.760 | we really felt that change in people's expectations,

00:33:52.720 | and the perception of how much something takes to be done.

00:33:57.720 | Like I had CMOs telling me like,

00:34:02.600 | "Andrei, how much time do you think

00:34:04.640 | that like five pages take to be done?"

00:34:09.640 | I'm asking because my CEO says that now with AI,

00:34:13.800 | and Webflow, it should take three days.

00:34:16.120 | And I was like, "Am I missing something?"

00:34:20.360 | Or, you know, and so there was like a big,

00:34:25.360 | as if the market economic correction wasn't enough,

00:34:30.640 | AI also brought some more pressure to the table,

00:34:34.240 | because you are now supposed to be more efficient,

00:34:38.280 | more like, more productive, faster.

00:34:42.160 | And I'm not saying this meaning

00:34:44.880 | that we are ignoring the change, no.

00:34:49.280 | But the change is like progressive, you know,

00:34:52.200 | it's not something that from one day to the other,

00:34:55.240 | you cut something that will,

00:34:57.400 | before chat GPT will take one year,

00:35:00.560 | and now you can make it into two weeks.

00:35:03.320 | It's not really like that, so.

00:35:06.520 | - Yeah, this has come up for me as well.

00:35:09.800 | And the way I kind of help educate people

00:35:13.040 | is AI is definitely here, it requires a conductor.

00:35:18.840 | So AI can only do so much as it's being inputted.

00:35:22.440 | And so usually when I have this conversation,

00:35:24.160 | I was like, "Look, the strategy piece

00:35:26.960 | "can't be replicated by AI."

00:35:29.040 | So you're coming in and setting groundwork.

00:35:30.920 | Now, once you inform the AI, it can augment work.

00:35:34.000 | So for example, like we're like,

00:35:35.200 | for Adobe, Adobe Firefly, right?

00:35:37.200 | They're kind of embedding design capabilities.

00:35:39.960 | And actually even with Adobe,

00:35:41.360 | they're introducing like Gen AI.

00:35:43.320 | And they have this thing where,

00:35:45.400 | based on the algorithms they have,

00:35:48.080 | they can do things like instantaneously

00:35:51.520 | grabbing from a library of images.

00:35:53.480 | Of course, they have a lot of stock images, right?

00:35:55.840 | They can do a thing where,

00:35:58.160 | let's say you're doing a webpage,

00:35:59.960 | and it can automate iterations of an image

00:36:03.480 | like 100 times within like a week.

00:36:05.720 | And it can iterate, iterate,

00:36:06.720 | and then automatically self-select to a winner.

00:36:09.640 | Great.

00:36:10.480 | The quality of those images are questionable, right?

00:36:13.280 | But again, there is value in automation,

00:36:16.440 | but it can't replace a strategy of it.

00:36:18.560 | And so that's where I go back to like,

00:36:21.440 | anyone who's trying to do this is like,

00:36:23.120 | you need to think through like how you're going to use the AI

00:36:26.040 | and that requires a human.

00:36:27.280 | But AI will augment the work, right?

00:36:32.000 | And so there are,

00:36:33.320 | but I don't think we're at the place yet,

00:36:35.760 | and we might be soon,

00:36:36.840 | where the AI cuts quality of work.

00:36:40.800 | I think it allows you to iterate quicker,

00:36:44.400 | but those iterations are also,

00:36:45.960 | they're not always ready for final production though.

00:36:47.720 | So it just allows you to speed up

00:36:49.480 | your brainstorming process possibly.

00:36:51.960 | But like, I have so much respect

00:36:54.200 | for like creatives and developers.

00:36:55.880 | There's some things you just can't take shortcuts on.

00:36:58.680 | And actually I feel developers

00:37:00.240 | probably feel the AI crunch even more,

00:37:03.280 | 'cause AI can actually spit out code now, right?

00:37:06.200 | And it's a lot more data driven

00:37:10.400 | and a lot less subjective than creative.

00:37:12.440 | So those folks, for my developer friends,

00:37:14.760 | they're really feeling it.

00:37:15.840 | They're like, people coming out of college right now,

00:37:17.880 | they can just spit in the code

00:37:19.240 | and then kick out a package.

00:37:20.920 | And like, yeah, that's hard.

00:37:22.720 | - Yeah.

00:37:23.560 | No, yeah, it's a multiplier of productivity,

00:37:28.880 | but I think you put it out well

00:37:31.320 | in the sense that if you don't know what you want to do

00:37:35.080 | or what type of outcome you are looking for,

00:37:38.800 | AI won't make it up for you.

00:37:41.240 | So there is also always some level of thought

00:37:45.480 | that needs to go into play.

00:37:47.440 | One of the sentences I like the most

00:37:51.920 | about this AI revolution is AI won't replace you,

00:37:56.920 | a person using AI will.

00:37:59.520 | - Yes.

00:38:00.360 | - Because I really identify myself

00:38:02.360 | with the thinking behind that.

00:38:06.360 | And I think that's where the things are headed.

00:38:12.280 | - I think a good example,

00:38:14.320 | and I even, I tweeted about that is,

00:38:17.640 | I don't know if you saw like the Vercel,

00:38:21.520 | they launched something called V0,

00:38:24.680 | which is basically, I have access to like a beta

00:38:29.680 | or test account or whatever.

00:38:31.840 | And basically it's a site,

00:38:34.560 | and you go there and you say,

00:38:36.520 | build me like a calendar app for my barbershop, whatever.

00:38:42.400 | It may be.

00:38:43.520 | And it literally gives you like a full fledged product

00:38:48.520 | that you can then use and take it as your own product.

00:38:54.440 | And so these things are happening

00:38:57.840 | and it's really a revolution.

00:38:59.800 | I think one of the few like protections

00:39:04.800 | that we human beings have from that,

00:39:09.320 | to avoid all of us to become unemployed,

00:39:12.360 | all of the sudden is IP.

00:39:15.080 | Because if I am like an early stage founder

00:39:18.520 | and I'm scrapping my ideas and testing an MVP

00:39:23.520 | for 10 of my friends or whatever it may be,

00:39:27.920 | it's totally fine to use that

00:39:30.040 | and to use that AI generated code

00:39:33.640 | and be dependent on Vercel,

00:39:36.640 | which is a private business to run my product, right?

00:39:41.200 | Like it's fine, I don't have revenue,

00:39:43.320 | I'm just testing things out.

00:39:45.200 | But if I am like a big company

00:39:48.560 | listed in the stock exchange or even a smaller one,

00:39:51.840 | but the company with already some

00:39:54.280 | like importance in the market,

00:39:56.360 | I can't have a product that depends

00:39:58.280 | on another privately owned company.

00:40:01.120 | And it was generated by AI,

00:40:04.320 | which in itself already has like concerns

00:40:08.280 | regarding the IP of the code that it gets,

00:40:12.640 | like there are concerns in the community

00:40:14.640 | regarding GitHub Copilot and all of that.

00:40:17.560 | And so what path do I need to run?

00:40:20.920 | I need to build my own product with my own code.

00:40:24.560 | Maybe AI is used into the mix,

00:40:26.880 | but it's like just as a facilitator

00:40:31.960 | and always reviewed by a human,

00:40:34.760 | but I can't afford to have my products

00:40:36.960 | being built on top of like Vercel or whatever it may be.

00:40:41.960 | So I don't know if this makes sense.

00:40:45.840 | I haven't spoke with too many people about this,

00:40:49.320 | but it's something that like crossed my mind

00:40:52.880 | a few times already.

00:40:54.160 | - Yeah, I mean, I definitely know that our company has,

00:40:56.840 | we are not allowed to use things like ChatDBT

00:40:59.000 | because it's aggregating the data

00:41:01.560 | and you can't have content risk being made public.

00:41:05.920 | And now it's public domain, right?

00:41:07.360 | And so we're utilizing tools internally that are like that.

00:41:12.360 | But I remember from my own stuff,

00:41:16.000 | to your point around people who use AI

00:41:20.240 | are better positioned to replace you.

00:41:22.280 | I totally believe that.

00:41:23.280 | An example of this would be like,

00:41:24.880 | I was writing for my own personal projects.

00:41:27.120 | I was writing some headlines and blogs

00:41:29.640 | and someone asked me to help them write like a paragraph.

00:41:33.760 | Now, normally my research process would be going to Google

00:41:37.400 | and like learn as much as I can, right?

00:41:40.440 | But I was able to do things like a ChatDBT,

00:41:44.120 | write me a paragraph about insert topic,

00:41:47.200 | utilizing these five keywords

00:41:49.680 | in the tone of someone who is insert persona,

00:41:54.400 | limited to 500 characters for the high-tech space,

00:41:57.440 | specifically in electronics.

00:41:59.800 | And it spit me off some people, right?

00:42:01.200 | Like the more thought you put into directing the AI,

00:42:06.200 | the more successful.

00:42:07.320 | But that's why I say it requires a conductor.

00:42:08.760 | And that's why AI can't just replace you outright.

00:42:12.440 | But you're right, if you know how to utilize it,

00:42:14.200 | then yeah, you're a lot better positioned.

00:42:16.800 | - There will be people making a lot of money

00:42:19.800 | on selling out to make the ultra-right Google prompts.

00:42:23.760 | - Yeah, that's true.

00:42:25.800 | - Right, because the quality of the prompt

00:42:28.120 | is extremely important and really has an impact

00:42:31.520 | on the output that you get.

00:42:35.480 | So yeah, I totally understand that.

00:42:38.600 | At the same time,

00:42:39.920 | and I don't want to drag this topic so much,

00:42:42.520 | but it's so fascinating, right?

00:42:45.480 | At the same time, I can tell you that,

00:42:48.600 | and maybe you have this experience yourself,

00:42:52.080 | from like a recruitment standpoint,

00:42:54.280 | we have in our application form,

00:42:56.760 | we have like three questions.

00:42:58.520 | One of them is like, "Why pixel managers?"

00:43:01.040 | And "Why you are a fit for the role?"

00:43:03.160 | Or one sentence about you, something along those lines.

00:43:06.840 | And I can tell you that even without using any tool,

00:43:10.760 | I can immediately like almost smell

00:43:15.200 | when someone just copy-pasted or something like that,

00:43:19.680 | something from ChatGPT.

00:43:21.400 | And that is happening right now.

00:43:23.400 | And so while I understand this is like,

00:43:27.280 | it's a phase that we will go through,

00:43:30.920 | like AI is very, like it's a baby yet for now.

00:43:35.920 | But what I mean to say with this is that

00:43:39.000 | I think that as more people adopt AI,

00:43:42.600 | for example, to write,

00:43:44.320 | the more valuable it will become

00:43:46.880 | to write something like very authentic and genuine

00:43:50.480 | and something that really comes from your heart

00:43:54.000 | and it's very raw, you know?

00:43:56.080 | Because people will notice this wasn't written by a bot.

00:43:59.480 | So there is that as well.

00:44:02.520 | It's like an opportunity that to me clearly exists

00:44:07.520 | in the midst of all the revolution.

00:44:09.560 | - Yeah, absolutely.

00:44:12.440 | And I think just kind of wrapping this up for everyone,

00:44:15.280 | you know, my key takeaway from this conversation is,

00:44:18.520 | you know, for a agency going through this climate,

00:44:22.960 | the quality absolutely matters, right?

00:44:25.200 | But I think what differentiates you at the end of the day

00:44:28.400 | when you go beyond the dollars and cents

00:44:30.560 | is that relationship piece.

00:44:32.000 | And I think your ability specifically

00:44:35.400 | to build that relationship, build that trust,

00:44:37.680 | and in some ways, just being a pure sounding board for me,

00:44:41.040 | whether we do business or not,

00:44:42.960 | is something that echoes very constantly with me, right?

00:44:47.480 | And so that's why I'm always thinking about Pixel Matters

00:44:50.320 | because of that relationship.

00:44:52.280 | So maybe that's the only way for now

00:44:53.560 | to kind of get through this

00:44:54.400 | and we find creative ways of getting, you know,

00:44:57.440 | getting foot into the door,

00:44:58.800 | but these are things that have lasting impressions

00:45:01.480 | on clients.

00:45:02.440 | So Andre, I just want to thank you for your time.

00:45:05.880 | And I learned a lot from this conversation

00:45:07.720 | and look forward to hopefully having you on again

00:45:10.360 | and just talking about anything else you want to talk about.

00:45:13.480 | - Yeah, Tim, thank you so much for having me

00:45:16.120 | and you are always so kind and you are right,

00:45:19.360 | like the relationships really matter.

00:45:22.600 | And we, whenever we work with someone that we like,

00:45:26.280 | like you, we look at the person

00:45:29.640 | and not to the role that the person has, you know?

00:45:33.200 | And so I'm happy that we have stayed in touch

00:45:37.440 | during good times, bad times.

00:45:40.440 | Now we are doing this podcast together.

00:45:43.560 | So yeah, I really appreciate it for you

00:45:46.480 | to give me the opportunity

00:45:48.560 | and enjoy, really enjoy the conversation as always.

00:45:53.560 | - Well, congratulations again

00:45:54.880 | on your 10 year anniversary.

00:45:56.280 | For everyone, pixelmatters.com is where you want to go

00:45:59.640 | or reach out to Andre Oliveira on LinkedIn.

00:46:03.040 | Thank you so much, Andre.

00:46:05.080 | - Thank you.

00:46:05.920 | - All right, talk to you later.

00:46:07.040 | (upbeat music)

00:46:09.640 | you

Thriving In A Tough Economy: How To Start And Succeed With Your Design Agency As A Small Business

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