A Tale of Two Web Designers
Why Positioning is Key to Success or Failure in Service Businesses
On a quiet Saturday in 2010, sitting on my father's porch on Thormanby Island, I faced a harsh truth. My Vancouver web design agency, once prosperous, was now skirting failure. The serene view from the porch stood in stark contrast to my inner turmoil as a young CEO at the brink of crisis.
At 24, I juggled client relations and profit margins, celebrated by magazines as "Recession Proof." Yet, deep down, a storm was brewing. The past year had been a scramble – settling tax debts, buying out a partner. These were mere symptoms of a deeper problem: a business model chasing quick gains over lasting value.
Our strategy was simple yet flawed: target wealthy boomers, offer cheap web solutions, subsidised through outsourcing. We prioritized immediate profits over true expertise, a short-sighted approach that couldn't last.
My struggles crystallised during a video shoot. Trying to articulate our value, I stumbled. "We market brands on the web," was the best I could come up with. But my hair was great!
Enter Andrew Wilkinson, a fellow young web design CEO from Victoria. Our revenues were equal at $250K when we became friendly in 2009. But that’s where the similarities ended. He wasn't just playing the part of a marketing genius; he was one.
Andrew’s Metalab was a beacon of clarity: "We Make Interfaces," read their simple homepage positioning. They built beautiful web products. Andrew leveraged PR masterfully, attracting Silicon Valley's attention with critiques of major companies and savvy endorsements. His approach was not just about making noise; it was about creating value.
Inspired, I shifted our focus – better designs, local talent. But our costs soared, and the gap between our makeshift strategy and Andrew’s precision became glaring.
In a desperate bid, we pitched a $30K campaign to Allwest Insurance, inspired by the brazen spirit of 'Slapshot.' It evoked the Hanson brothers, known for their roughhouse on-ice tactics. Our tagline, "Who’s Looking out for #1?", was a good fit for Allwest’s hockey presence and guardianship spirit.
Paul Zalesky, Allwest’s owner, loved and immediately signed our proposal, but it was a short-lived lifeline. The next morning, Shirley, Allwest’s controller called, as I travelled to my father’s spot at Thormanby. I can still hear her voice as she said, “Sorry Tommy, we can’t proceed with the project now. Maybe next year.” It felt like a final blow.
As I stared out over the yard my brother and I helped clear as teenagers, the truth hit me: our business lacked identity. We were trying to be everything to everyone, and it was our downfall.
The subsequent days were some of my career's toughest. I had to face our team with layoffs, marking an end and an uncertain beginning.
Meanwhile, Andrew’s success soared. He expanded Metalab, even did the early product designs for Slack (a company later sold to Salesforce for $28 billion). Andrew started buying other businesses like media sites and other agencies. In 2023, he took his companies public as TINY in Canada with a personal stake worth $600 million.
But TINY stock was cut in half in 2023. Critics say its business units don’t justify a premium multiple. Yet, in my eyes, Andrew remains a strategic visionary. He has a great track record, alignment with shareholders (owning ~67% of the company), and 50+ years of compounding ahead of him. I’m watching TINY closely for a cheap entry price that may never come.
Every visit to my dad's cabin reminds me of that 2010 turning point. Painful, it was the best thing for me. It led to successful ventures like CEO.CA, where we owned our niche and demand exceeded capacity.
Paul sold Allwest for a bundle in 2021 and our friendship endures. I rarely talk to Andrew anymore, but I remain an admirer. He demonstrated an essential truth in the service industry: the might of strategic positioning. It's a game-changer – defining what you do, who you do it for, and what they get out of it.
Neglecting this, you're adrift in a sea of competition, as I was. Master it, and you may chart a course towards achievement, rivalling even the most accomplished like Andrew Wilkinson.
Great article 🤓