The Margin Myth: Why Growth Without Efficiency is Just a Faster Way to Burn Out

Growth isn’t the victory lap. Profitability is.

Anyone can add revenue with enough hustle, discounting and over-servicing. The real skill is building a business that gets bigger and healthier at the same time.

Right now, too many founders are celebrating growth that’s quietly eroding the very thing that keeps them in the game: margin.‍

‍Reality check: 40% of agencies over £2M turnover operate below 10% net profit. Growth isn’t fixing the problem; it’s hiding it.

We glamorise “scale” and “momentum” so much that it’s become normal to cheer revenue milestones without ever asking: What did it cost us to get there? Not just in ad spend, but in margin, in operational sanity, in leadership headspace.

That’s the margin myth in action: the idea that you can grow first, then “sort out” efficiency once you’re bigger.

You don’t suddenly become disciplined at £10M. You just get louder with the same bad habits.

Revenue on its own is a terrible indicator of business health.

It flatters your ego.
It wins you LinkedIn applause.
It looks great on a pitch deck.

But it hides:

• How hard your team is working to deliver it
• How leaky your processes are
• How fragile your pipeline really is
• How little is left once everyone else gets paid
  

You can double revenue and end up with less money in the bank if your margin structure is broken.

The real signal isn’t “Are we growing?”, it’s “What does each pound of revenue actually do for the business once it lands?”

Until you answer that, you’re just turning up the volume on a system you haven’t tuned. Most founders don’t see the cracks because growth hides them, until the volume gets too high to ignore.

On the outside, it looks like success: new logos, busy teams, a calendar full of pitches.

On the inside, it feels like this:

• Projects priced on instinct, then delivered at a loss
• Teams firefighting because scope, process and expectations keep shifting
• Leaders spending more time smoothing chaos than making decisions
• A creeping sense that “we’re bigger than ever, but it’s never been this hard”
  

I’ve seen agencies with £5M top lines, and nothing left to show for it. Not because the market turned, because they never learned what profit really means.

When you don’t build operational discipline as you grow, everything becomes a bespoke exception.

Every client: custom deal.
Every project: custom process.
Every delivery: custom pain.

It feels like creativity. It even sells like creativity. But under the surface, it’s chaos with a brand deck.

There’s a comforting story many founders tell themselves:

“Let’s chase growth, then once we hit £X, we’ll slow down and optimise margins.”

Here’s why it rarely plays out.

1. Bad habits compound
   The way you sell, price, staff and deliver becomes “the way we do things”. At scale, those habits are harder, slower and more emotionally expensive to unwind.
   
   
2. Your cost base locks in
   As revenue grows, you make senior hires, sign longer leases, and commit to tooling. Your fixed costs creep up while your margin discipline is still immature.
   
   
3. Expectations get set externally
   Clients get used to over-servicing. Teams get used to heroics. Investors get used to headline growth. Rolling that back feels like “decline”, even when it’s actually health.
   
   
4. You lose your optionality
   Thin margins limit your ability to invest, pivot, or say “no” to bad-fit work. You end up taking on the very projects that further erode your profitability.
   
   

Across £200M+ in exits, we’ve seen the same pattern: founders who design for margin early build optionality. The rest builds exhaustion.

You don’t earn the right to focus on profitability “once you’re bigger”. You earn the risk of being wrong about your unit economics at a much larger scale.

Operational discipline isn’t about bureaucracy or slowing things down.

It’s about designing your business so that:

• Good decisions are the default, not the exception
• Margin is protected by your system, not your stress levels
• Growth actually makes life easier, not harder
  

This is where high-performing companies quietly separate themselves. Not in the slogans, but in the detail.

Some unsexy but powerful examples:

• Clear offer architecture
  A small, defined set of services with standard inclusions, exclusions and delivery models. Less “we can do anything” and more “here’s the best way we create value.”
  
  
• Pricing rooted in reality
  Rates and fees built from capacity, cost and profit targets, not from “what seems reasonable”. Every price knows its job: what margin it must protect.
  
  
• Capacity-led sales
  Pipeline decisions based on who is actually available to deliver, not just who wants to buy. Saying “not now” to protect delivery quality and margin.
  
  
• Standard ways of working
  Templates, playbooks, and processes that 80% of work runs through. Freedom for teams sits on top of structure; it doesn’t replace it.
  
  

The result isn’t rigidity. It’s predictability. And predictability is what makes profitable creativity possible.

If you want to break the margin myth, you need to stop treating profitability as an outcome and start treating it as a design constraint.

Some practical questions to build around:

1. What margin are we targeting, and why?
   
   
   • Gross margin: What must we earn after direct costs to run the business well?
   • Net margin: What’s the minimum that justifies the stress, risk and responsibility?

2. What does that imply for pricing?
   
   
   • At our cost base, what minimum rates or retainers do we need?
   • What work types consistently destroy our margin, no matter how well we deliver them?

3. How does that cascade into operations?
   
   
   • Do our scopes, timelines and staffing models make the numbers achievable?
   • Do we have guardrails to stop margin erosion in live projects?

4. Where are we leaking profit today?
   
   
   • Write-offs and over-servicing
   • Poor utilisation of senior roles
   • Discounting at the proposal or renewal stage
   • Constant “one more thing” favours that never make it onto the invoice

You won’t solve all of this in a week. But you can stop pretending it’s a problem for “future us”.

Underneath the margin myth is a deeper belief: that business success is about how hard you can push.

Work harder. Sell more. Say yes. Then deal with the consequences.

The companies that last play a different game. Their questions sound more like:

• What would this look like if it were easy to run at twice the size?
• How do we protect the energy of the people who actually deliver the work?
• What are we no longer willing to do, even if someone is willing to pay for it?
  

They understand that operational discipline isn’t a constraint on ambition. It’s the infrastructure that lets ambition keep going when the initial excitement wears off.

Because sooner or later, it always does.

If this all feels abstract, here’s the most practical next step:

Stop guessing.

Run the numbers.

Model:

• What you sell
• What it costs you to deliver
• How much capacity you actually have
• What happens to your profit if you grow 20%, 50%, 100%… as you are today
  

You might discover that more of the same growth will quietly erode your margin to the point where you’re “busy and broke”.

Or you might find you’re closer to a robust model than you think, and you can scale with far more confidence once a few key levers are tightened.

Book a confidential founder call with Unusual Group and see how we help agencies install systems, pricing, and structure that compound, not collapse, under growth.