Dec 8, 2024
This Rural Irish Firm Grew from €300k to €1.4M in Six Years
Tyler Suomala
Creator of Growthitect
Welcome to Money Memos! Money has always been taboo in our industry. But that's shifting…
Despite the growing need for financial transparency, many architects have kept firm finances close to the vest, even with partners and close colleagues.
But now, more architecture firm owners are sharing financial insights to grow stronger, more resilient firms.
In an effort to provide real, candid insights into the financial side of running a practice (and to shake up the silence around money), I've created Money Memos. This series brings you anonymous and rare looks into how your peers are navigating the numbers.
Want to participate? Submit your Money Memo here
Here's a look from one of 3 directors at a 6-year old architecture firm with 12 employees located in rural Ireland:
Projects:
Multi-unit residential and some commercial work.
Office Situation:
We own. The mortgage is €3k per month. It's a 175 year old heritage building. Constant drain on energy and resource with issues of an old building.
Salary:
€90k salary. Benefits include healthcare and a company car. Bonus depends on profit/cash at the end of the year and it varies €0 to €30k.
My salary started at €40k and I've been steady at €90k for the last 2 years. I don't anticipate a rise next year.
Work/life balance:
Excellent! We have a 4-day office week, 8am-6pm Monday to Thursday. I typically work a hard day every second Friday.
Debt:
€300k mortgage at 4%. €50k in Professional Indemnity (PI) insurance is paid with hire purchase at 3%.
Revenue:
We've grown roughly 12% each year since we started. Our annual revenue was €300k year one and now, 6 years later, it's €1.4 million. Our profit margin is ~15%.
We're constantly investing in software upgrades and staff training; currently in the middle of a transition from 2D to Revit.
Our goal is to get our profit margin between 20-25% and hit €1.5M in annual revenue.
Best & Worst Expenses:
Best expense is my company car. It's an EV and very tax efficient. PI insurance is a pain and our worst expense. It was €78k 3 years ago but down to €45k now.
Biggest Mistake:
Buying the office was probably a mistake. But we needed to improve our office environment and it looked like a good opportunity at the time.
Firm owners: Want to participate? Submit your Money Memo here