What's your backstory?

My backstory is quite fascinating. At around 12 or 13 years old, I discovered web design and development, which was exciting at the time since creating websites wasn't as common as it is now. I spent countless hours after school building various projects, and eventually, I started selling my services. Given the scarcity of web developers, many business owners sought my help to create or design their websites. It amazed me that I could earn money doing something I loved so much I would do it for free. Using an alias, because I was only 13, I managed to keep my clients unaware of my age.

A few years into freelancing, I realized that trading my time for money wasn't ideal, so I decided to productize my skills. I created a browser game where players could build and expand a mafia family. Surprisingly, the game attracted about 10,000 players in a few months, and I even received an acquisition offer. Selling my first company was an exhilarating experience, all done without my parents' knowledge. They would have been shocked, questioning why I was engaging in these activities online and accepting money from strangers.

This experience marked the beginning of my entrepreneurial journey, though I hadn't envisioned myself becoming an entrepreneur. I was inclined towards consulting or corporate roles, leading me to study mechanical engineering, a decision I quickly regretted. My passion lay in creating digital products, not learning about thermodynamics or technical mechanics. Fortunately, in my second semester, I co-founded an educational company with friends, which expanded rapidly to over 120 cities in Germany and Austria, attracting over one million website visitors monthly. My studies took a backseat as my business ventures took center stage.

That venture was my first foray into the startup scene, and since then, I've never worked for anyone else. Being an entrepreneur is incomparably rewarding. Over the past 15 years, I've launched numerous businesses and invested in several companies, leading me to create Magic Design.

What does your company do and how did you come up with the idea?

The concept behind Magic Design is straightforward yet essential: every business requires design. Throughout the 15 years of building various companies, I've always needed design services. Initially, design demands were simpler and the quality expectations were lower, allowing for modest efforts like a single Facebook ad to suffice for an entire year. However, the landscape has dramatically changed, necessitating a vast array of assets ranging from landing pages, social ads, email graphics, to print materials. The importance of outstanding design can't be overstated—it enhances usability, sets you apart from competitors, and significantly attracts customers.

Magic Design was born from a reluctance to start an agency. My co-founder, Sina, introduced me to a new model inspired by some innovators in the U.S., which shifted away from traditional project-based pricing to a software-like subscription model. This approach meant clients would pay a fixed monthly fee, covering all their design needs with a turnaround time of 48 hours for assets. Initially skeptical, I was eventually convinced by the model's merits—it perfectly aligned with what I would have desired as a founder or marketer: a reliable partner delivering high-quality, timely assets without the constant negotiation over prices. It offers entrepreneurs predictability in expenses and flexibility with the ability to adjust, pause, or cancel their subscription.

What distinguishes Magic Design in a crowded market is our emphasis on scalability, quality, and targeted geographic innovation. From the outset, we designed Magic Design to scale, establishing processes to manage hundreds of designers efficiently. Quality is non-negotiable; we commit to employing only top-tier designers to ensure our survival and relevance in the future. While there are countless design agencies available, focusing on specific markets for innovation is crucial. We began with Germany and Europe as our initial markets, planning to expand from there. This strategic approach, combined with our subscription model and commitment to quality and scalability, positions Magic Design uniquely in the design services industry.

How did you get your first 10 customers?

Navigating the path to securing the first 10 users in a startup is always a fascinating challenge. I firmly believe that many companies falter not because their product lacks merit, but due to the absence of effective distribution channels. As someone deeply passionate about product development, I could easily immerse myself in refining my product and website indefinitely. However, the stark reality is that without the capability to sell your product, the entire endeavor is futile.

In the case of Magic Design, we took the bold step of selling our product before we had even assembled a team of designers or developed any backend systems. This approach was viable because we recognized a clear market demand—every company needs design. Our previous experiences in startups had already acquainted us with the specific pain points of our target audience.

Our strategy encompassed two pivotal actions. First, we engaged in customer discovery, conversing with 30 to 50 potential customers, including founders and marketing executives, to gain insights into how they perceive and articulate their design needs. Although we were already familiar with the challenges, these conversations served to validate our assumptions about market needs.

Secondly, we concentrated on identifying an effective initial channel to acquire our first five to ten customers. A common pitfall we observed—and have previously encountered—is the temptation to spread efforts across too many channels simultaneously. For Magic Design, we leveraged our personal network to secure the first five customers within a few weeks, then relied on cold outbound emails to attract the next five. These methods not only proved to be effective in the early stages but have also remained crucial components of our marketing strategy.

What steps did you take to understand and confirm that your product or service was a good match for the needs and wants of your target customers?

Navigating Magic Design's trajectory has been a rollercoaster, characteristic of many startup journeys. Initially, I assumed our biggest hurdle would be customer acquisition. Surprisingly, securing the first five and then ten customers was straightforward, despite not having a single designer on board—forcing us to handle the design tasks ourselves. This early success was a clear indicator of product-market fit, something I hadn't experienced with such immediacy in any previous venture. This success can be attributed to several factors:

1. Pre-validation of the Model: Knowing that our business model had already been tested and proven elsewhere gave us confidence.
2. Understanding of Pain Points: Drawing from our own experiences, we were intimately familiar with the challenges our target customers faced.
3. Customer Interviews: Despite our insights, we still conducted interviews to validate and understand the nuances of our ideal customer profile's (ICP) challenges, enabling us to tailor our solution effectively.

Sharing our founder story significantly bolstered trust with our clientele, as they recognized that we had firsthand experience with the challenges they were facing. While the initial customer acquisition phase was relatively smooth, scaling operations and establishing repeatable sales processes became more complex over time.

A year into our journey, we're continually faced with setbacks, mainly due to our ongoing search for scalable and repeatable channels. My approach emphasizes the importance of engaging in non-scalable activities initially. Many founders err by rushing towards automation and scalability without fully understanding the dynamics of each channel. For instance, in cold outreach, we explore various strategies to improve lead sourcing and open rates, testing everything from automated email campaigns to personalized LinkedIn messages and videos.

The key takeaway from these experiments is the compilation of learnings to formulate a strategy that propels business growth. I firmly believe that focusing on a single "hero channel" can scale any business to at least $1 million in revenue, rather than diluting efforts across multiple channels.

Magic Design enjoys a robust product-market fit, with customers quickly recognizing and valuing the service we provide. This advantage is rare and significantly contributes to our growth. Additionally, Magic Design benefits from founder-led sales, a strategy not feasible for low-ticket SaaS businesses due to the high time investment required. In contrast, my direct involvement in outreach ensures that engaging with 100 people weekly translates to new customers—if not, the responsibility falls on me.

This hands-on, founder-driven approach underpins our strategy to expand our customer base, aiming for the next 50, 100, 200 customers. It encapsulates the essence of Magic Design's growth philosophy: understanding customer needs, validating our solution, and committing to intensive, personalized outreach to build and scale our customer base.

How did you reach and acquire your first 100 customers? Which platforms or methods did you use to connect with them and promote your product or service?

As of now, Magic Design has successfully onboarded around 50 customers, marking our halfway point to reaching the initial milestone of 100 customers. The journey ahead is promising, and our strategy for growth involves a blend of proven tactics and new initiatives tailored to our unique strengths and experiences.

Continuation of Successful Channels: Our primary focus will be on leveraging strategies that have already yielded results. This includes tapping into our personal and professional networks and engaging in cold outreach efforts. These methods have been foundational in building our current customer base and will continue to be pivotal as we aim to double our reach.

Incorporation of Long-Term Strategies: Drawing from our experiences in previous ventures, we plan to implement long-term growth tactics that have demonstrated success. Key among these is the production of SEO-optimized content and the establishment of a strong, recognizable brand. Social media will also play a crucial role in enhancing our visibility and engagement with potential customers.

Leveraging Side Products: A unique aspect of our growth strategy involves the creation of mini products or side projects. This approach has proven effective in our past businesses, driving significant traffic and subsequently converting visitors into paying users. These side products not only serve as valuable tools or resources for our target audience but also act as indirect marketing channels for Magic Design.

Resource Management and Prioritization: One of the perennial challenges we face is the balancing act between our ambitious ideas and the limitations of our resources. Our strategy necessitates careful planning and prioritization to ensure that we execute the most impactful initiatives without overextending our capabilities.

Target Audience Focus: Our efforts will be specifically tailored to appeal to early-stage founders, heads of marketing, and content leaders—individuals and teams with an ongoing need for high-quality design services. We are confident in our ability to offer superior solutions compared to their current alternatives, which will be a critical factor in our continued growth.

In summary, our strategy to reach and acquire our first 100 customers hinges on a combination of immediate and long-term initiatives. By building on the foundations of direct outreach and network leveraging, while also expanding our reach through content, social media, and side projects, we aim to not only meet but exceed the expectations of our target audience. This multifaceted approach, coupled with our focus on delivering superior design solutions, positions us well for achieving and surpassing our next customer acquisition milestone.

What distribution channels did you try that didn’t work?

Our experimentation with paid advertising, specifically social media ads aimed at driving traffic to our website for demo bookings and to access freebies, did not yield the results we had hoped for. Despite investing time and resources into this channel, we found it to be prohibitively expensive without delivering the expected return on investment. This outcome could be attributed to several factors, including possibly our lack of patience or insufficient focus on optimizing this channel for our specific needs.

Magic Design, by its nature, requires a certain level of explanation to potential customers, distinguishing it from straightforward e-commerce products that consumers might impulsively purchase upon seeing an ad. Our initial foray into social media advertising might have faltered due to a misalignment in targeting, failing to reach the audience segment most likely to benefit from and engage with our offering.

Recognizing these challenges, we've decided to pause our paid advertising efforts temporarily. Instead, our strategy has shifted towards strengthening our brand presence and creating valuable content. This foundational work is essential for establishing a more substantial base from which we can effectively utilize social media ads in the future. By focusing on building a strong brand and developing compelling content first, we aim to enhance our future marketing efforts on social media platforms, potentially revisiting paid ads with a more strategic and targeted approach.

What specific tools, software, or resources have been most helpful in growing your business?

In the quest to grow Magic Design, we've leaned heavily on a suite of tools that have significantly streamlined our operations and enhanced our productivity. Among the plethora of resources we've explored, three stand out for their pivotal roles in our daily activities and strategic development:

1. Figma: Figma has been indispensable for all our design needs. It's where we create the 'magic' for our clients, crafting everything from website layouts to social media ads and white papers. Its collaborative features and intuitive interface make it a favorite among our designers and the broader team. Figma's versatility and ease of use have solidified its position as our graphic design tool of choice.
2. Webflow: Webflow is another critical tool in our arsenal, enabling us to build and update our website efficiently. Its user-friendly platform allows for seamless collaboration among team members, ensuring that content updates and new site elements can be implemented swiftly without bottlenecking our development processes. Webflow's ability to accommodate multiple editors and integrate closely with our development team's workflow makes it invaluable for maintaining an up-to-date and dynamic online presence.
3. Loom: Loom has revolutionized the way we communicate, both internally and with clients. It allows us to create videos for a variety of purposes, from detailing project updates to explaining the nuances of Magic Design's services. The asynchronous nature of Loom communications has proved to be a game-changer, offering a highly efficient method to disseminate information and engage with clients without the constraints of scheduling and real-time meetings.

These tools—Figma, Webflow, and Loom—have been instrumental in facilitating our growth, improving our operational efficiency, and enabling us to deliver exceptional value to our clients. I highly recommend exploring these tools to anyone looking to enhance their business's productivity and collaborative capabilities.

How did you make the transition from a side hustle to full-time entrepreneurship?

For me, the journey into full-time entrepreneurship wasn't marked by a single transition moment from a side hustle; it's been my chosen path throughout my adult life. Since my university days, I've never been employed by someone else, having always pursued my ventures. After establishing and running previous companies, it was a natural continuation for me to embrace entrepreneurship wholly.

This ongoing experience has made me accustomed to the pressures and challenges inherent in entrepreneurship. Despite these challenges, I firmly believe it's the most rewarding career path. My conviction is that if you're truly passionate about your venture, you will find ways to make it viable and sustainable. Passion fuels perseverance, and with that drive, monetization and success become achievable.

For those contemplating the leap into full-time entrepreneurship, starting as a side or part-time hustle can be a prudent approach. This phase allows for customer demand validation and gradual transition without immediately foregoing a steady income. However, there comes a critical juncture where you must commit fully. Going all-in is essential for substantial growth, as it eliminates the safety net and necessitates a focus that can propel your business forward significantly. From my perspective, embracing entrepreneurship fully, with all its risks and rewards, is key to unlocking its true potential.

What made you get into a design subscription business rather than a regular design agency?

The decision to venture into a design subscription business over a traditional design agency was driven by multiple factors, rooted in my own experiences as a founder. I found design agencies to be prohibitively expensive and slow, often failing to match the pace required by a rapidly evolving startup. This discrepancy highlighted a gap in the market for a service that could offer high-quality design work with swift turnaround times, all while providing clear cost expectations.

The subscription model appealed to me because it mirrors the familiarity and convenience of software services, which are integral to modern business operations. Why shouldn't design services offer the same level of accessibility and predictability? This approach not only simplifies budgeting but also fosters a stronger alignment between the service provider and the customer. By eliminating the common points of contention around pricing and scope, both parties can concentrate on achieving the best possible outcomes.

Choosing a subscription model for Magic Design was about building a solution that I would have wanted for myself—one that guarantees quality, speed, and transparency. This model is designed to cater specifically to the needs of startups and marketers, ensuring they receive the support they need to thrive without the usual hassles associated with traditional agencies. Ultimately, this approach benefits everyone involved by prioritizing the quality and efficiency of the design process.

What drives you to do what you do?

My motivation stems from the profound belief that there is no greater vocation than being an entrepreneur and engaging in the act of creation. This belief is deeply intertwined with my personal mission to foster growth, both for myself and for others. The drive to constantly learn, experiment, and innovate fuels my journey, providing a sense of purpose and fulfilment.

Through Magic Design, this mission takes on a tangible form as we assist businesses globally to enhance their design capabilities. Our goal is to empower these companies to attract and satisfy more customers through superior product design. The ability to contribute positively to the success of others, to help them achieve their goals and elevate their offerings, is incredibly rewarding.

The essence of my drive is the dual satisfaction of personal growth and the impact we make on our clients' success. It's about the joy found in discovery and innovation, coupled with the gratification that comes from seeing others thrive because of our efforts. This blend of personal development and contributing to the broader community encapsulates why I do what I do, and why I believe there's no better job in the world than being an entrepreneur.

What advice do you have for founders in the earlier stage of their journey?

The paramount piece of advice I have for founders at the early stages of their entrepreneurial journey is the importance of focus. As a founder, you'll naturally be inundated with an endless stream of ideas—new products to develop, marketing channels to explore, partnerships to pursue. However, the harsh reality is that both your time and resources are finite.

The most significant leverage you possess lies in where you choose to direct your focus. Spreading yourself too thin across too many initiatives simultaneously is a common trap, leading to half-finished projects and diluted efforts. Instead, the key to making meaningful progress and achieving impactful results is to concentrate on a select few priorities.

Commit to fully executing two or three critical tasks or projects rather than attempting to juggle an unmanageable number of tasks. This approach ensures that you not only complete these tasks but do so with the level of quality and attention they deserve. By maintaining a laser-like focus, you maximize your limited resources and move closer to your goals with greater efficiency and effectiveness.

Any quotes you live by?

Hard work beats talent.

Your links + socials

Maximilian Fleitmann

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Magic Design

Website
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