Financial Model
Built a financial model to introduce visibility into labor cost, project profitability, and capacity planning for a 3-person agency. The model became the foundation for pricing, hiring, and revenue decisions, enabling consistent 50% delivery margins and more predictable growth.
Context
In 2023, Brave Little Beast was a 3-person agency generating steady six-figure revenue with strong delivery processes, but no visibility into profitability, labor cost, or capacity.
We couldn’t answer basic questions like:
Operationally, we were organized. Economically, we were guessing.
Intervention
Results
For the first time, revenue planning was based on capacity and cost structure instead of intuition.
Established and maintained a consistent 50% delivery margin
Increased hourly project close rate ~20% after pricing adjustments
Eliminated negative-margin retainers through renegotiation
Reduced overhead ~30% through consolidation and cost controls
Introduced capacity-based revenue forecasting
Enabled structured hiring decisions based on financial impact
Pricing Corrections
A Defining Moment
During this transition, we declined a high-profile project after the client pushed for discounted pricing.
Under our previous model, we likely would have accepted based on prestige alone. Using the new framework, we determined the project would not meet our margin threshold and walked away.
Six months later, we learned the agency who accepted the work was struggling under scope creep and micromanagement, reinforcing that margin discipline also protects operational health.
Reflection