I’ve spent 11 years in the SEO trenches in Europe. I’ve run delivery teams that hit the ceiling of human output, built internal Python scripts to scrape data while my team slept, and watched agency owners burn out trying to pivot into “tech companies.”
Most agencies try to ship software because they are desperate for non-linear growth. They look at their service margins and realize they’re capped by the amount of hours a human can sit at a desk. Then, they decide to “productize” their workflow. And almost every single time, they crater.
Here’s a story that illustrates this perfectly: learned this lesson the hard way.. If you aren’t looking at your operation with the cold eye of a software architect, you aren’t building a product. You’re building a bespoke nightmare that will cannibalize your agency’s profit.
The Math: Why You’re Failing the Margin Test
Service agencies dibz.me operate on a linear model. You hire a person, they bill hours, you take a percentage. Eventually, you hit a utilization limit. You can’t hire your way to infinite scale because middle management becomes a tax on your efficiency.
Software is different. The math is simple, yet agencies ignore it:
The mistake is thinking your current internal script—the one that saves your link-building team five hours a week—is a SaaS product. It’s not. It’s a patch for a leaky process.
Mistake #1: The Wrong Problem Selection
I see this constantly: an agency identifies a “need,” but the need only exists because their agency is poorly run. They try to sell a tool that fixes a broken internal workflow to the market. But the market isn’t your agency.
When you suffer from wrong problem selection, you build features that nobody wants to pay for. You’re solving for a custom configuration that worked for a specific client—maybe a high-stakes partner like a branch of Coca-Cola or a Philip Morris sub-contract—but the generic version is useless to the rest of the world.
Stop building things that only exist because your internal process is messy. If your “software” requires a 45-minute onboarding call, it isn’t software. It’s a consultancy service in disguise.
Mistake #2: The “What Breaks at Month 3?” Blindspot
I ask this of every tool vendor I talk to: “What breaks at month 3?”
Most agencies can launch a version 1.0. You’ve got the technical chops to get a MVP (Minimum Viable Product) live. But agencies are terrible at maintenance. They treat software like a deliverable—”build it, ship it, move to the next client.”
Software is not a deliverable. It is a living, breathing entity that demands customer support, API updates, and security patches. By month three, your developers are back on client work, the API has changed, and your users are complaining. You haven’t built a business; you’ve built a technical liability.
Take tools like FAII.AI or UberPress.AI. They succeed because they focus on specific, high-friction tasks. They don’t try to do everything. If you are building software to replace an agency task, ask yourself if the utility survives the first time a major platform (like Google or Meta) shifts their UI.
Mistake #3: No Dogfooding
If you aren’t using your tool to run your own agency, you aren’t building a tool. You’re playing developer. This is what I call the “no dogfooding” trap.
Your agency should act as a lab. If your tool is supposed to automate backlink audits, your entire team should be using it 40 hours a week. You should be screaming at your developers because the tool is too slow during the Tuesday morning sprint. Exactly.. That feedback loop is the only way to build software that actually scales.
If you don’t use it, you don’t know where the “time thieves” are hiding. My personal list of agency time thieves is long—manual reporting, repetitive outreach, link-tracking spreadsheets—but if your software doesn’t kill one of those in a way that is objectively faster than a human, it’s just fluff.
Mistake #4: Scope Creep as a Strategy
Agencies are addicted to saying “yes.” When a client asks for a custom report, the agency says “yes.” When they translate that into software, they say “yes” to every feature request that comes from a high-paying client.
This is scope creep on a catastrophic scale. You start building an SEO tool, then someone asks for a social media dashboard, and suddenly you’re building a Frankenstein platform that does nothing well.
I’ve seen companies like Four Dots or large enterprise entities like Philip Morris manage vendors. They don’t care about your side project. They care about outcomes. If your software gets bloated because you’re trying to make it all things to all people, those enterprise clients will drop you for a tool that just does one thing perfectly.
How to Pivot: The Agency-as-Lab Model
To succeed, you have to separate your concerns. Your agency and your software company should be distinct entities.
Final Thoughts on Tooling
I look at modern AI stacks like FAII.AI or UberPress.AI and I see agencies getting excited about the tech rather than the utility. Don’t fall in love with the tech stack. Fall in love with the math of recurring revenue.
Software is not a way to get “growth.” Growth is a byproduct of solving a problem so well that people pay you while you sleep. If you aren’t ready to fire your developers from client work so they can focus on the product, you aren’t ready to ship software.
And for heaven’s sake, if a tool vendor raises their prices mid-year on you, dump them. If you’re building software, hold your own product to that same standard. If your software doesn’t provide 10x the value of the subscription cost, you don’t have a product. You have an agency that’s about to go out of business.
Be boring. Focus on the math. And for the love of everything, stop building until you’ve stress-tested the “Month 3” burnout.
