Interview with Matt Cooper, Founder of Alpha Digital
With an eclectic background in justice studies, philosophy and film, Matt Cooper, Founder of Alpha Digital, has taken a rather unconventional route into the world of entrepreneurship. Quitting his full-time job in 2011 to pursue a passion project, Matt was half way through producing a feature film when a friend suggested he should start his own digital agency.
Having dabbled in a series of account management roles and looking for his next challenge, Matt dived into the deep end and started ‘Alpha Digital’, armed with nothing more than $1000 and a laptop. A succession of noodles, tuna and eggs later (an entrepreneur’s staple diet) Matt persevered through the first year, bringing on two employees shortly after. Now with a team of 25 staff and a revenue in the seven figures, Alpha Digital is a leading digital agency in both Brisbane and Sydney.
Can you tell us a bit about your background?
I worked for a company called 1300 Flowers and prior to that, I worked for a web design agency. One of the clients (1300 Flowers) offered me a position as General Manager for their e-commerce website over in the UK so I did that for a couple of years before coming back to Australia. After that, I decided to chase a dream of mine which was to make a movie. I actively pursued this for a year before a friend of mine suggested I start my own digital marketing company. I started the Alpha Digital Agency in May 2011.
Had you done much digital marketing before?
I’d been involved with web development and designing websites before so I knew what SEO and Adwords was but I hadn’t gotten into it in depth. I immediately hired two people who were experienced with the more technical aspects of digital marketing. That way I could focus on the business development and company management side.
What were your biggest struggles in the beginning?
Survival! In year one I had $1000 in startup capital and a laptop. So, no private investment, no debt and just a website and an email address. I made $16,500 in revenue in the first year which I used to pay myself. $12,500 of that was spent on rent which left me with $4000 to spend on food and clothing. I ate tuna and rice pretty much religiously, mixing it up with pasta and sometimes, egg and noodles. I shopped at Woolworths late at night to get all the specials. I lived very cheaply and burnt through all my savings, a credit card and a personal loan!
What made you continue as opposed to just getting a full-time job?
It was growing fast and I could see the potential. There was a lot of struggle and sacrifice in the first year but I was finally doing my own thing and steering the ship of my own company. I really enjoyed that in comparison to being an employee. As year one progressed into year two we started to get a few more clients and word of mouth began to spread. Our strategy was just to be better and cheaper than our competitors. We had a really good reputation and eventually started to build a portfolio of very happy clients.
Why do you think it has grown as quickly as it has?
By being customer results focused. We work in the client’s best interests and get them a really strong revenue stream, so as the client grows we grow with them. This is something I’ve repeated many times to staff members at Alpha Digital Agency.
I place a big importance on being honest, ethical and transparent with our clients and I think that also attracts staff members who are the same. In digital marketing, there are a lot of cowboys out there and a lot of agencies who are known as ‘churn and burn.’ To those agencies, there’s so much work out there and they can just sign people up, do an average service and if they get disgruntled and quit, six or twelve months later it doesn’t matter because you’ve got clients to replace them with.
We’re the opposite as we try to build our portfolio and only take on clients when we can actually perform the work for them, so there have been times when we’ve grown so quickly that I’ve had to say no to business. That has meant that we have a very low churn rate of clients and also a very low churn rate of staff. So, our clients enjoy long term relationships with Alpha Digital and the account managers they speak to. I think those are probably the reasons why we’ve been successful and why we’ve got such a good reputation.
What do you look for in new talent?
I look for people who are enthusiastic about digital marketing and who really see it as a big part of their future. One of the common questions I ask is, ‘Where would you like to be in five years’ time?’ If digital marketing is in the core vision of themselves in five years’ time that’s really important. We also look for honesty, transparency, and ethical approaches to work. High achieving university performance measures such as high GPA’s, double degrees and having performed in a number of internships are also a good indicator.
What are some hard lessons you’ve learnt?
Letting a client grow to be a large part of your business and having too much faith in a small portfolio of clients and not diversifying. For example, there was a client that was at one point 50% of our revenue, so it was this monster massive client. Out of nowhere, the board of directors fired the General Manager, the CEO and the Project Manager. The company then made an immediate shutdown of all expenses which including all advertising. So overnight 50% of our revenue got shut off with one month’s notice. It was definitely a hard lesson. A lot of business advisors will tell you never to let a client get up 20/25%.
What’s your five-year plan?
I actually have a six-year plan! So, we’re six years old and the last six years have been fantastic. We’ve grown from a laptop and $1000 to a seven-figure revenue and 25 staff. The last six years have been very successful but the next six years are going to be even greater in terms of growth, change and achievement.
I sort of feel like we’ve reached base camp at Mt Everest. The last six years have been in preparation for the base camp of Everest and now we’re about to step out of QUT CEA which has been a fantastic support and it’s almost like we’re moving out of home now. But I think we’re more than equipped to survive and prosper and climb to the summit of Everest! The next six years should be very exciting and we’re going to be winning a lot of new business, especially some marquee clients. We’ve got a few of them at the moment such as City Beach and Matt Blatt so we’re looking to win larger clients like that as well as grow our medium and entry level client base as well.
We’re also planning to expand our intern and digital marketing team and introduce some brand new digital marketing services. Can’t talk anymore about those but watch this space!