My AI Automation Agency FAILED

Key Concepts

AI Automation Agency, Automation, Zapier, Make.com, n8n, Recurring Revenue, Churn, Upwork, Freelancing, SaaS, Call to Action (CTA), Personal Branding, Lead Generation, Future-Proofing, Service-Based Business, AI Agents, No-Code, Education as a Service.

What is an AI Automation Agency?

An AI automation agency helps businesses automate their workflows using software like Zapier, Make.com, and n8n, which have become more powerful with the integration of AI. Automations are configured sequences of steps for specific tasks, such as automated email sequences for new leads. AI integration allows for more complex automations with "if" statements, "for" loops, and AI-powered steps.

Business Model:

• Fixed Fee: Agencies charge a one-time fee (e.g., $5,000 - $10,000) for setting up the automation.
• Recurring Fee: They also charge a recurring fee for monitoring, customization, and API management, providing ongoing support and maintenance. This is intended to generate recurring revenue.

Why the Speaker Launched an AI Automation Agency

The speaker, previously focused on blockchain development education, pivoted to AI due to changing interests. He identified the AI automation agency model as a seemingly easy and fast way to enter the AI space. His plan was to:

1. Create an AI agency.
2. Achieve $10,000/month in revenue.
3. Launch a coaching business or private community to teach others to do the same.

Learning and Skill Development

The speaker learned AI automation by:

• Watching tutorials, particularly recommending Nate AI Automation's 8-hour course.
• Working on real projects to gain experience and confidence. He automated processes within his own YouTube business, such as:
  • Automating his weekly newsletter creation using n8n, reducing the time spent to 10 minutes.
  • Creating a market research tool to track the profitability of private AI automation communities by scraping member counts and calculating churn.
  • Automating the process of recording new member information in his free AI solopreneur community into a Google Sheet and adding them to his email list.
  • Building an automation to monitor successful videos from favorite YouTube channels for content creation ideas.

Client Acquisition Attempts

• Upwork: The speaker created an Upwork profile with a video introduction and a portfolio showcasing his automation projects. He subscribed to Upwork for two months, spending $40. He applied to five jobs, had three conversations, and found one potentially good corporate client interested in team training. However, he found the quality of leads generally poor.
• YouTube: He created videos about n8n with calls to action (CTAs) inviting viewers to contact him for automation services. This generated five leads and one meeting, which was the best lead he received. The lead was from a consulting company reviewing construction plans and wanted an automation to speed up the review process. The speaker created a proposal, but the client never responded.

Quote: "It shows that YouTube in a personal branding is really good for generating leads compared to Upwork."

Reasons for Discontinuing the AI Automation Agency

• Market Competitiveness: The barrier to entry is low, as no-code tools like Make.com are accessible even to non-coders.
• Churn: The recurring revenue model is difficult to sustain due to high churn rates. Clients often cancel after a short period and attempt to replicate the automations themselves.
• Future-Proofing Concerns: The speaker questions the long-term viability of AI automation agencies as AI becomes more advanced and easier for businesses to use directly.
• SaaS Competition: He believes that SaaS businesses will automate the most popular workflows, offering simpler and more integrated solutions than custom automations.
• Personal Dissatisfaction: The speaker realized he dislikes service-based businesses and chasing clients, reminiscent of his negative experience as a freelancer.

Quote: "I just hated every second of it because you always have to hustle to find your next customer and I I wasn't happy at all. Like that was really freelancing hell."

Shift to AI SaaS

The speaker is pivoting to focus on building SaaS businesses with AI. He realized his audience is more interested in SaaS than AI automation.

Quote: "We just have one life. Okay? So, let's just go for the things that we really want. Okay? So, let's just go for uh AI SAS."

He will continue to mention automation only when relevant to building SaaS products. For example, studying popular workflows on the n8n marketplace to generate SaaS ideas.

Future Plans

• The speaker will launch a separate channel dedicated to the AI automation agency, focusing solely on acquiring end clients.
• This channel will focus on creating content related to building SaaS businesses with AI.

Conclusion

The speaker's experience highlights the challenges of launching an AI automation agency, including market competitiveness, churn, and long-term viability concerns. He is shifting his focus to AI SaaS, driven by audience interest and a desire to build a business he enjoys more. The key takeaways are the importance of validating business ideas, considering long-term market trends, and aligning business ventures with personal values and interests.