What percentage do most teams take?
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Yikes that's ridiculous.
Do you think people would go for a non-profit team that takes 5% or so which will go into either developing the team further or donated to a charity?
Some teams like Senior Team, charge a surplus of 25% from their clients. 15% from freelancers and 10% for processing fees.
It's ridiculous, thinking that they've had the opportunity to work with some big notable youtubers and are extremely dependant on their freelancers. The work environment has no other perks for working there other than for your cut of the commission $$. They could do so much more things to make the work environment more beneficial when they rely on their freelancers so much..
Oh wow that's crazy cuts.
What are the main things that make them stand out right now? Is it their discord bot, their size etc?
I believe it's their dominance over the market currently.
They have a sticky thread on every service category and also new users tend to see them as responsible as well as their size.
Their discord bot used to be miles ahead of other service teams, but now it's pretty standard if not only a few steps ahead of other teams.
They have a sticky thread on every service category and also new users tend to see them as responsible as well as their size.
Their discord bot used to be miles ahead of other service teams, but now it's pretty standard if not only a few steps ahead of other teams.
Yeah they're pretty established for sure, I might give it a shot if enough people would be interested in it.
Don’t do it.
Most services teams take a 15% cut from their freelancer and charge a 10% fee to their clients to cover PayPal's G&S Fees.
Not all teams are terrible and some actually put genuine effort into bringing clients, and coming up with original ideas even though the effort can't be seen
Not all teams are terrible and some actually put genuine effort into bringing clients, and coming up with original ideas even though the effort can't be seen
Just saying "Don't do it" isn't particularly useful not gonna lie
Sure. I’ll expand on that for you.
Service teams both damage your own reputation (not in an MCM stat sense) and the profit margins are not worth it.
It’s very easy to be a shit service team, and very difficult to be a respected one. Ask most established community members, they’ll look down on you. Ask most established respected freelancers, they’ll look down on you. Why? Maybe take a look at all the old countless archived suggestions begging the staff team to outright ban or regulate service teams.
I can also say from experience, the profit margins are pitifully low and the business does not scale well. Back when this concept was new in 2017, I ran one of the “big three” teams in the market. Our total revenue netted about $15-20k over the course I ran it, but the actual profits were around 10% accounting for PayPal fees etc.
For the time spent managing the whole shitshow, your returns are pitifully low. You’re essentially a call centre for freelancer customer service - they typically exploit underdeveloped countries with penny wages for that stuff in the real world. You’d be working below minimum wage for the hours you spend on it (if you don’t put in the hours, you’re probably one of those shit services teams I mentioned earlier), and that leads to the issue of scale. This market is painfully small - there’s a limit before you’re experiencing diminishing returns in growth (and I had a healthy marketshare over MCM and Spigot with tons of recurring clients like Arkham Network and a few decently sized YouTubers etc). You can’t grow it big enough to make it worth your while.
You’ll run into a paradox too. Want a higher percentage for yourself? You’ll only receive shit or new freelancers who are desperate for commissions. Want to charge way higher prices and take on some real big projects (in MCM market standards), you’ll need to charge way lower percentages to attract higher skilled freelancers... oh most of them look down on service teams anyways. There’s not much future profit potential.
I will admit. Build teams do feel profitable since their market prices are actually kinda decent (in an MCM sense). But you’d be carrying a lot of deadweight if you diversify into a general service team - maybe pick a niche.
Does this prove to be more useful knowledge to you?
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This was very useful thank you,
I'd first of all like to say that if I did this I wouldn't be doing it for profit, the aim is to provide extra funds for the charity that I should have officially registered sometime this year.
I only plan to take 10% at most, if even that much. 5% going back into developing the team and 5% towards the charity.
Although this would not necessarily mean the team is better than others, I feel it would definitely improve the view others have of the team and may even convince higher skilled freelancers to join the team so that they know the percentage of the commission that is taken away is going into something to benefit the community, as well as other communities around the world.
I really appreciate you taking the time to write all of the above, thank you
Lotus makes a lot of good points here, but I would like to add on something.
I believe most people miss the true value you can generate from a service team. When running a team, you have the opportunity to grow a huge cash balance.
While yes, you will eventually need to pay out on orders, and your margin on that deal may be slim it is often that case that a team can have thousands of dollars sitting in accounts. The thing I noticed over my time running a team, is that with consistent advertising, you can find a value of which your business' balance will never really drop below. As long as you can guarantee new orders, and are willing to keep up with the work, you can keep this balance stable.
What this means is, if you have the risk tolerance, you can spend that money, and generate revenue just by having cash to spend. A common example would be to schedule order payments and a server launch around the same time, so you spend a little bit on ads for the service team, take in a bunch of orders, and in the 2 or 3 days it takes to have the freelancer's complete the orders, spend their held balance on another set of ads, this time for the server launch. Then, simply use the revenue made from the server launch to pay the freelancers. At the end you are left with returning clients, whatever residual profits come from the server and more cash to repeat this cyclically and scale it up.
Obviously the example mentioned, and others like it are extreme-risk strategies.
Which is why I stress this strategy is only viable if you have cash to back this up should an investment fail. I imagine this strategy would be hard to pull of without the necessary connections and infrastructure. It seems most people who do these kinds of models exit the market after a year or so, as the stress of this kind of cycle is by all accounts severe. I for one felt it better to move to a much more stable approach to investing.
Finally, if you are getting into this business for charity, I suggest somewhere else. It is a tough place to be, and I do believe the only way anyone ever really does it well is to be greedy and arrogant.
As a team owner, the businesses, and by that your interests, do not align with everyone. What is best for the freelancers is almost always worse for the executives and/or customers. Generally speaking, it's really difficult to be benevolent to all parties, you have to pick somewhere someone is getting a rough deal. Who you choose that to be is up to you, but if you think everyone is getting a good deal your lying to yourself.
Feel free to PM me if you want to talk about anything specific.
I believe most people miss the true value you can generate from a service team. When running a team, you have the opportunity to grow a huge cash balance.
While yes, you will eventually need to pay out on orders, and your margin on that deal may be slim it is often that case that a team can have thousands of dollars sitting in accounts. The thing I noticed over my time running a team, is that with consistent advertising, you can find a value of which your business' balance will never really drop below. As long as you can guarantee new orders, and are willing to keep up with the work, you can keep this balance stable.
What this means is, if you have the risk tolerance, you can spend that money, and generate revenue just by having cash to spend. A common example would be to schedule order payments and a server launch around the same time, so you spend a little bit on ads for the service team, take in a bunch of orders, and in the 2 or 3 days it takes to have the freelancer's complete the orders, spend their held balance on another set of ads, this time for the server launch. Then, simply use the revenue made from the server launch to pay the freelancers. At the end you are left with returning clients, whatever residual profits come from the server and more cash to repeat this cyclically and scale it up.
Obviously the example mentioned, and others like it are extreme-risk strategies.
Which is why I stress this strategy is only viable if you have cash to back this up should an investment fail. I imagine this strategy would be hard to pull of without the necessary connections and infrastructure. It seems most people who do these kinds of models exit the market after a year or so, as the stress of this kind of cycle is by all accounts severe. I for one felt it better to move to a much more stable approach to investing.
Finally, if you are getting into this business for charity, I suggest somewhere else. It is a tough place to be, and I do believe the only way anyone ever really does it well is to be greedy and arrogant.
As a team owner, the businesses, and by that your interests, do not align with everyone. What is best for the freelancers is almost always worse for the executives and/or customers. Generally speaking, it's really difficult to be benevolent to all parties, you have to pick somewhere someone is getting a rough deal. Who you choose that to be is up to you, but if you think everyone is getting a good deal your lying to yourself.
Feel free to PM me if you want to talk about anything specific.
I'd like to put in my $0.02 in regards to Cal and Lotus' posts.
Firstly, Lotus' - I believe many of these points are very moot. While I don't run a service team in the standard sense, I do run a development team called Nexure. You can find some info about us on my page if you so choose, but that's not why I'm here. Generally, I feel as if the bad rap falls on to service teams as a whole. I was privy to this when Dean, someone who has now vouched on my thread, messaged me inquiring about the backend of my team, the percentage cuts I take, etc... After telling Dean everything nearly, he realized that perhaps Nexure wasn't so bad. To lay a blanket statement out such as "Ask most established community members, they’ll look down on you. Ask most established respected freelancers, they’ll look down on you." is dangerous, as it gives the impression that a service team can't be good, which quite simply isn't true.
The reason most service teams fail is because they never expand. Businesses are meant to grow, and if you're constantly operating at a 10-20% cut of even 500 jobs in a year, you're not going to get anywhere. A lot of service teams have terrible owners with zero capital, which is primarily why those owners are just after money. If you have a solid foundation as an owner, though, you can use it to expand. Nexure, for example, will be expanding to have its own professionally-made Website (Hopefully with Syncore) soon. This will allow us to break through the idea of the McM-esque 'Service Team', despite that being where we started.
Lastly, I'll say this - Freelancers are the most important part of any team. My developers are fucking fantastic, and I make sure they know that. Out of over five hundred applicants, we've accepted a grand total of under twenty, and only six of those >20 are still with us Today. However, the team we have in place now is experienced, quick, good with communication, and they fit with one another extremely well. Now, that's not the case for most teams, sure - However, it could be. It's a matter of value, which dips in to the last point I made. A lot of team owners simply value how much money they can scrounge up each month, but if you have someone who truly values their business, someone who wants to expand beyond what they are now... That's when you get into something special.
Next, Cal's - I have far less to say about this one, so I promise to be less long-winded. Essentially, I disagree with most of what was stated here. The 'strategies' listed in this post are... not viable for most. I have nothing further to say about that really.
Where I truly find issue is the last two blocks of text. "do believe the only way anyone ever really does it well is to be greedy and arrogant." Really? You can't be serious mate. Arrogance and greed are two of the things that kill most service teams, and that's just a fact. That said, a charity-related team, in my mind, isn't a terrible idea. While it's true that your interests may not align with everyone, who the hell cares? Finding a balance that works well for high-quality freelancers as well as yourself is the key. Finding these freelancers, getting them to understand and allign themselves with your values, that is what will make something like this succeed. To say that you have to contain greed and arrogance to be successful is idiocy (No offense Cal).
Firstly, Lotus' - I believe many of these points are very moot. While I don't run a service team in the standard sense, I do run a development team called Nexure. You can find some info about us on my page if you so choose, but that's not why I'm here. Generally, I feel as if the bad rap falls on to service teams as a whole. I was privy to this when Dean, someone who has now vouched on my thread, messaged me inquiring about the backend of my team, the percentage cuts I take, etc... After telling Dean everything nearly, he realized that perhaps Nexure wasn't so bad. To lay a blanket statement out such as "Ask most established community members, they’ll look down on you. Ask most established respected freelancers, they’ll look down on you." is dangerous, as it gives the impression that a service team can't be good, which quite simply isn't true.
The reason most service teams fail is because they never expand. Businesses are meant to grow, and if you're constantly operating at a 10-20% cut of even 500 jobs in a year, you're not going to get anywhere. A lot of service teams have terrible owners with zero capital, which is primarily why those owners are just after money. If you have a solid foundation as an owner, though, you can use it to expand. Nexure, for example, will be expanding to have its own professionally-made Website (Hopefully with Syncore) soon. This will allow us to break through the idea of the McM-esque 'Service Team', despite that being where we started.
Lastly, I'll say this - Freelancers are the most important part of any team. My developers are fucking fantastic, and I make sure they know that. Out of over five hundred applicants, we've accepted a grand total of under twenty, and only six of those >20 are still with us Today. However, the team we have in place now is experienced, quick, good with communication, and they fit with one another extremely well. Now, that's not the case for most teams, sure - However, it could be. It's a matter of value, which dips in to the last point I made. A lot of team owners simply value how much money they can scrounge up each month, but if you have someone who truly values their business, someone who wants to expand beyond what they are now... That's when you get into something special.
Next, Cal's - I have far less to say about this one, so I promise to be less long-winded. Essentially, I disagree with most of what was stated here. The 'strategies' listed in this post are... not viable for most. I have nothing further to say about that really.
Where I truly find issue is the last two blocks of text. "do believe the only way anyone ever really does it well is to be greedy and arrogant." Really? You can't be serious mate. Arrogance and greed are two of the things that kill most service teams, and that's just a fact. That said, a charity-related team, in my mind, isn't a terrible idea. While it's true that your interests may not align with everyone, who the hell cares? Finding a balance that works well for high-quality freelancers as well as yourself is the key. Finding these freelancers, getting them to understand and allign themselves with your values, that is what will make something like this succeed. To say that you have to contain greed and arrogance to be successful is idiocy (No offense Cal).
A responsible, sensible businessman would never take up a service team, the margins are bad, the staff and time demands are ridiculous compared to the expected margins. That's why it's rare to see a team owner around here older than maybe 20. But an arrogant one, he may think "yeah I reckon I can get something profitable with a few hundred dollars and a few hours a day".
Arrogance is not a bad thing, at least not in this case. Business acumen is grossly overrated in my opinion. Not knowing what mistakes you are making can be hugely beneficial. Especially in early, low risk ventures like a service team. It repeats over and over in technology startups. More often than not, startup founders who lead a successful product often had no idea what they were doing when they first get going. So they take stupid risks, go way outside of the scope of their project, and ignore sensible points to cut losses and instead push on.
A sensible, humble businessman would of taken the profits from their service team and put in a blue chip stock or a hedge fund to grow over time. Could of been a lot of money in 35 years. Or, they could bet his first good earnings on one server one time because the owner is charismatic and he found a good deal to get 300k views on YouTube worth of exposure for $6/cpm.
Finally what better motivation than greed? Especially when the ceiling is so high, and risk for a traditional style of team so low.
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These are some fair points, but for the most part I feel it has the same hubris your first post did. You preach risky, nonsensical strategies then preach near-riskless investments. Additionally, you go on to say arrogance isn't a bad thing, then you discuss how arrogance leads to the failure of countless businesses because, and I quote, "they take stupid risks, go way outside of the scope of their project, and ignore sensible points to cut losses and instead push on".
Your entire post is contradictory from start to finish. This post, ultimately, regards a venture that is not filled with greed. This is the precise reason why it has more of a chance than the service teams you so desperately claim are invalid and shit (Which, to be fair, most of them are). I don't take issue with your standpoints entirely - I take issue with your blanketed statements. Not everything is bad in one section or another, saying so immediately nullifies any validity you previously had. 100% of nothing is successful or a failure. 100% of people don't do the same thing(s). 100% of near-nothing is true. Of course there may be some special cases like dying, but that's vastly off topic.
While I'm at it, let me just say this. As the owner of a thriving development team, I did put a portion of the profits into stocks or crypto. I've reinvested nearly 100% of my profits, and I now spend next to no time actually running the team. 90% of my time spent here is overseeing tickets. My freelancers are, in most cases, more than capable to deal with anything clients may throw at them. This ties into the point I talked about last post regarding sensible, high-quality freelancers making or breaking a team and how the owner who values the company over money will succeed because he follows this model.
I honestly can't even begin to show how appreciative I am of you both taking the time to explain your points as well as providing useful advice/information.
Over the next few days and weeks I will definitely be re-reading over all of these posts to really take in the advice you have given so far so that I can determine the best route to take when looking further into setting this team up.
Extensy, If it is fine with you I would love to talk to you in dm's to discuss the logistics and back-end side of things at the team you currently run and what would be the best options going forward for the team I am looking into.
Cal, I do like the unique nature of the ideas you have suggested and will be sure to read more into them when I'm deciding on different aspects of the potential team. One thing I will say is that I am more looking for a lower risk, long-term plan for the team. As this will be a source of funding for the charity and I would like to see how far I can really take this team with the variety of different goals I have for the future.
Thank you both again, it really does mean a lot that you have taken the time to provide more insight into the service team 'sector' of the market.
Appreciate you both
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