Behind the scenes

7 min read

Yearly round-up - 2022

Skyward has officially turned 1 🥳, (back in June) and this year has been a rollercoaster. We’ve had some great months working on amazing projects and we’ve also had some not-so-good months (it can’t always be perfect I suppose!) but even despite that this year has been incredible.

Written by

Dan Spratling - Founder & CEO

Dan Spratling

Published on

2 August, 2022

I’ve grown a lot and learned a lot, and through all the ups and downs I’ve been able to hyper-focus on exactly where I want to take Skyward, going from a growth-focused agency into a more personal one. I still, of course, plan to grow the agency and the team behind it in the future, but only when it’s (and I’m) good and ready to do so.

I wanted to share the progress we’d made and the direction I plan on taking Skyward in the future. I’ve always been very open about how Skyward runs so this will be a totally transparent look at what we’ve done, some of the decisions I’ve made, and how successful they’ve been (everyone loves to talk money, don’t they?).

If you’d like to see more like this, let me know on Twitter or sign up to our newsletter!

What we’ve done

Skyward website relaunch

I’ve been thinking hard about the direction we want to take Skyward and the old website wasn’t doing our work justice.

There were a few things I wanted to improve on:

  • Very technical sales approach → Refocus on our UX roots
  • Complex “flashy” features → Easy updating for everyone on the team
  • Unclear brand image, bland & corporate → Become a professional, yet personal brand

Essentially, we wanted the website to better reflect who we are, what we do, and the values we bring across.

Of course, being busy meant that this kept getting pushed back, which is why it took over 6 months to release. Whoops! 😅

Going forward we’ll be continuing to update this site with more relevant content, talk more about the work we do and the results we provide.

Pigeon Loans

At this point I’ve been working with Pigeon Loans on and off since I started freelancing in 2020 and have helped them grow from an idea into a thriving and in-demand platform with over 20k users (and counting).

This year we helped Brian and the team redesign their application, refreshing the UI and dramatically improving the user experience to help make peer-to-peer lending safer and easier for everyone.

In the past few months, they’ve successfully achieved Y Combinator Alumni Status and over $2.5m in additional funding. An amazing achievement and I expect they’ll continue to top it going forward!

Read the case study

Other projects

We always aim to deliver the best results and sometimes that takes a long time. Some of our projects have been going on for a while, and we’ll be certain to share once they’re ready!

You can see a sneak peek of some of our newer projects on our homepage.

Head over to our Projects page to keep up to date with our latest work.

Finances

I’ve learned a lot about how to (or how not to) manage money in this year, but overall it’s been a great year. Every quarter has been profitable and each quarter has also earned a significant amount of revenue!

2021-2022 Revenue/Costs table. Q3 2021: Revenue $57600. Costs $50500. Profit $7100. Q4 2021: Revenue $33800. Costs $32000. Profit $1800. Q1 2022: Revenue $51500. Costs $35000. Profit $16500. Q2 2022: Revenue $74000. Costs $69000. Profit $5000.

Our quarterly finances from June 2021 to June 2022

With that in mind, you can clearly see that most months aren’t left with much breathing room, with Q4 2021 being scarily close to making a loss (not as bad as actually making a loss though), and Q1 2022 only being so profitable by pushing costs to a later quarter - a strategy that could have easily backfired. Costs have grown a LOT more than revenue since the previous year - this makes sense as I switched from freelancing and hired/contracted more.

Even so - it has been an excellent first year of business, but there’s a lot of room for improvement!

(Keep in mind, these numbers are counting my own pay as costs too - this shows money left after each month, but does not take into account tax which happens after the end of the first year)

Going Profit First

Profit first is a model where you take all your income and break it out into profit, expenses & owners pay & tax. Then limiting yourself to only spending what’s in your expenses & owners pay pots.

By breaking your income down this way, you’re encouraged to only spend what’s in pots allocated for spending, and therefore always ending the year with profit, and slowly optimising the efficiency of your business. It’s like a sealed piggy bank - you can’t open it without smashing it, or at least that’s the idea.

That’s obviously a very simple version of how this works, if you’re interested in reading deeper, I’d highly recommend reading the entire book (it’s a really good read).

I haven’t been very good at it this year. There have been unexpected expenses and difficult projects that required more investment than originally planned - but regardless of this being able to use the profit pot to pay for this has meant we’ve always had a buffer when things get hard. It’s how we’ve always stayed profitable overall, even in the bad months.

Next year, the plan will be to build this pot out so we can take more profit at the end of the year, hopefully leading to bonuses, and giving us a bigger buffer in the event of problems that might arise.

Fully transparent

One thing I’ve always thought while working at agencies in the past is “why are they hiding their processes?”. The ways we work shouldn’t be secret or only used to impress our clients when it means we’re about to win work (aka: make some money). One thing I’ve found since working for myself is that there’s plenty of work to go around. So let’s help bring everyone up while we’re at it!

We haven't been perfect this year, mainly due to being extremely busy, but we've started sharing our resources to help you understand our process and even use them if you'd like.

Our Designs

Want to take a look at our design process for Skyward? Have a look at our Figma files and see exactly how we work and what we’re working on, including how we break down our components and showcase our work to clients.

See the designs

Statistics

Wanna see how well the Skyward website is actually doing? What was our best (or worst) month? Where does our traffic come from? How has it changed over time?

We draw tons of interesting insights from analytics for our clients and ourselves on a regular basis, and as a brand new agency we want to include you in the journey and show you exactly what this rollercoaster is like!

Explore our live Analytics

Doing our part

Skyward may not be a huge business after just one year, but that doesn’t mean we can’t start giving back! We hope to see this list (and the funding we can provide) grow over time.

Carbon Offsetting

Going forward we’ll be offsetting our carbon use to ensure we’re doing our part. We’ve already started offsetting 200% of the carbon our full-time team uses while working and while not working (yep, we’re carbon positive!). We decided to use Wren to offset our carbon which allows us to easily calculate how much carbon our team uses, and contribute to a variety of projects to help alleviate that!

Join Wren and help the planet

We also considered offsetting the carbon used to create our websites, but our static websites are so carbon efficient, we’d only need to plant one tree per year! It’s still good to keep an eye on your sites though, especially as they get more complex and more visitors.

Discover the carbon impact of your website

Supporting developers

We’ve also started sponsoring FreeCodeCamp, an amazing and totally free learning platform for developers starting their careers in tech. I’ve been supporting them on Twitter for a while, so it feels great to be able to sponsor them too!

Visit FreeCodeCamp

Lessons learned

It’s not all about growth

A lot of people see endless growth as the goal of their business. Growth is impressive and looks good on reports (or on Twitter), but I’ve found that growth for bigger figures is hard work, potentially damaging long term.

This year I nearly tripled growth since freelancing (from $60k freelancing to $200k at Skyward), but that also meant increased stress, higher costs and extra responsibilities. That’s not to say I don’t want to keep growing Skyward (I definitely do!), but I’ve learned that I have to be much smarter about it. More isn’t always the answer, especially if that means a lot more costs too.

Ups and downs will always balance out

There will always be high and low points in business, but if you stay on your toes and keep looking for things that can be improved, you can always turn things around.

And if you keep doing that over time, things will continue to improve. Skyward is extremely new in business, so some mistakes are expected to be made. My goal is always to keep things going in the right direction, and if (or more likely, when) mistakes happen, we learn from them!

Next year goals

While this last year was good, our goals next year are to earn more consistent income to reduce pressure on the business and allow us to provide even better results. Fewer swings, more stable growth, and more of a profit buffer will allow us to worry less about where the next job is coming from and focus more on our clients' businesses, as well as our own.

2022-2023 financial goals targeting $75k revenue per quarter and an increase in profit by $5k per quarter

My target quarterly finances from June 2022 to June 2023

Profit is calculated after paying my own salary. In the UK, business owners take dividends after tax is calculated (instead of being paid wages which are calculated before tax). But regardless of how I'm paid, that pay is a fixed cost of business, so I account for it in these figures like any other employee/freelancer would be accounted for. Profit is also calculated before tax and as this is our first year that's not shown in the current figures.

A profit & loss graph from June 2021 to July 2022

You can see how both our revenue (green) and our costs (red) had large spikes and dips over the months. While income is never totally predictable, especially in agencies, this kind of unpredictable income pattern can lead to rash decisions, overconfidence (when things are going well) and panic (when things aren't).

Ups are great, downs not so much. I want the income and costs of business to be more stable and predictable, and while viewing this quarterly helps smooth this graph out, you can see that Q4 and Q2 had very high costs, regardless of how much income was made.

Being more consistent means being able to be more profitable, which makes the business more secure in the event of any issues, or allows us to be more proactive with our growth, hiring in areas that benefit the business, instead of hiring reactively when we get busy as I have done mainly this year.

Lifestyle goals

One of the core elements that drove me to create Skyward was the freedom to work on what I’d like when I’d like. That was why I initially went freelance too.

While not every job is going to be perfect, I have mostly been able to work on what I’d like in the ways I’d like.

This is no small feat, especially while growing the business, hiring others, and making a profit.

But there are still improvements that we could make.

The first is keeping my work hours below 32 per week. I’ve recently reduced my working hours to try and improve my work-life balance. This has meant a much better sleep schedule! But I would love to be able to get to a point where I am consistently able to keep to only working 4 days (32h) per week or less.

I also need to manage my capabilities better. It’s very easy to get overwhelmed as a Designer/Developer/Leader/Founder, especially as teams and workloads start to grow. Finding a good balance between growth for the business, without adding extra stress, is incredibly important for the business's continued success. This requires me to know my limits, what I can delegate, and how best to do that - and better pick work based on our specialised skills, and our schedule.

It’s still amazing progress

I have to be honest, when I went freelance 2 years ago, I never expected to be running a small agency and even though there have been ups and downs, I’ve learned so much, gained so much experience and made so many new friends.

In only 2 years I’ve gone from being “just a developer” to a founder running a UX-focused Jamstack agency, and I’m incredibly proud of what my team and I have been able to achieve. I can’t wait to see what’s next.

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