When Scaling Ads Breaks Your Business

Summary

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Podcast Summary: Follow The Yellow Brick Road

Episode: When Scaling Ads Breaks Your Business

Hosts: Emma Rainville & Mitch Barham
Release Date: May 12, 2026

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Episode Overview

This episode dives into a paradoxical challenge in online business growth: how scaling ads — bringing in too many customers, too quickly — can actually break or even destroy a business. Emma and Mitch explore the operational pitfalls, from overwhelmed customer support to broken systems, and share real-world stories and tactical advice for avoiding these common traps. The conversation also highlights how leveraging technology, especially AI agents, can prevent chaos as you scale, and why customer service should be treated as a profit center, not a cost.

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Key Discussion Points & Insights

1. Why Scaling Too Fast Is Risky

• Key Insight: Getting too many customers without robust systems is the fastest way to “break” your business.
• Emma (00:00): “The fastest way to break a business isn't by not having enough customers. It's by getting too many too fast.”
• Mitch (00:07): “You can literally scale yourself, grow yourself out of business because things just crumble and break.”

2. Customer Service: From Cost Center to Growth Engine

• Empowering Customer Service:
  • Many businesses see support as a “refund processor,” but it’s a huge driver of retention and revenue.
  • Emma (01:51, 02:17): “It should be a revenue producing department and it absolutely can be if you know what you're doing and how to do it.”
  • Tactics:
    • Monitoring support tickets for sales opportunities.
    • Creating retention programs — e.g., giving info products in lieu of refunds.
    • Training agents to cross-sell and upsell during support calls.
    • Treating support as brand advocates (with regulatory awareness — “without creating FTC violations.”)
• Memorable Story (05:30): Emma recounts hiring a star employee from a penis pump company, giving humorous insight into product knowledge, team culture, and making agents real advocates by having them (and sometimes their families) use the product.

3. Operational Systems & Scaling Pains

• Consequences of Poor Systems:
  • Fulfilling too many orders without protocols leads to errors, customer dissatisfaction, and reputational damage.
  • Common issues:
    • Not enough inventory
    • Middleware failures when too many users crash a system
    • Merchant accounts freezing funds if sales spike suddenly
    • Hasty, suboptimal hiring during crunches
• Notable Quote (13:02):
  • Mitch: “Sometimes people complain about that… never, in 21 years, had somebody actually hold any percentage of our money that came in.”
  • Emma: “I've not had a problem with Amazon [reserves], but I've had them steal our products and recreate them.”

4. Hiring in a Crunch:

• The “panic hire” is a near-universal founder mistake.
  • Emma (14:19): “I don't think that any of us have not done that. That's...If you've been in business for 30 seconds, you've absolutely done that.”
  • Quick hires often cost more in the long run in terms of money, reputation, and even personal relationships.

5. AI Agents as the New Scaling Superpower

• Major Shift:
  • AI-based agents now amplify output, speed, and quality across customer service and operations.
  • Mitch (15:46): “In my business we have I think 32 now at this point. It's like 5x the productivity of my existing employees. It's just ridiculous.”
  • Emma (15:58): Describes how building layered agents (task, QA, management, team review) scales capacity dramatically without layoffs — in fact, she’s hiring more people for agent management.
  • AI can spot anomalies, manage inventory, and answer repeat questions quickly, preventing bottlenecks.
  • Mitch (18:14): “There’s almost no bottlenecks in this day and age that a business should have. Or drop the ball because you got too many customers.”
  • New programs like their “AI Workforce Lab” help others implement these systems.

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Notable Quotes & Memorable Moments

• Emma (00:00):

  "The fastest way to break a business isn't by not having enough customers. It's by getting too many too fast."

• Mitch (01:37):

  "You can literally scale yourself, grow yourself out of business because things just crumble and break."

• Emma (02:17):

  "If you look at customer service as something that just pulls money out of your business, you are making a mistake."

• Emma (07:03):

  "I used to go into the bathtub on Saturdays about 8 o' clock with a bottle of wine and dry erase markers and I would sit and listen to customer service calls… The grout, because it doesn't come out of the grout."

• Mitch (15:46):

  "In my business we have I think 32 now at this point. It's like 5x the productivity of my existing employees. It's just ridiculous."

• Emma (15:58):

  "I've not got rid of one person. In fact, I'm about to hire another guy in my business Shockwave, because having someone that understands how to oversee and manage the agents… now my people have gone from doing things to managing the things that are getting done."

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Timestamps for Key Segments

• [00:00-01:30] — Main problem: Growing too fast can kill your business
• [01:30-04:50] — Customer service as untapped scaling lever (retention, upsells, affiliates)
• [05:30-07:00] — Story: Culture, product knowledge, and hiring in unusual businesses
• [07:00-10:00] — Quality control, customer call insights, and real feedback loops
• [11:00-13:30] — Systems and merchant account disasters when scaling up
• [14:00-15:30] — Panic hiring: damage and inevitable founder mishaps
• [15:30-18:40] — AI agents changing the scale game, practical examples
• [18:40-19:20] — The future: Seamless scaling with tech + human oversight

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Takeaways & Actionable Advice

• Treat customer service as a revenue driver — Train, empower, and incentivize your support team.
• Prepare systems (inventory, middleware, SOPs, payment accounts) before scaling ads/traffic.
• Avoid panic hiring — anticipate operational needs and build bench strength.
• Leverage AI and automation for repeat tasks, freeing humans for higher-level problem-solving.
• Quality control and listen to feedback — Use customer input to improve both product and messaging.
• Anticipate the pain points of scale — Don’t wait for problems to emerge, proactively shore up weak spots.

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Overall Tone & Style

Conversational, candid, and direct. Emma and Mitch share hard-earned lessons, practical systems, and stories with humor and zero sugar-coating. Their banter and openness make operational challenges feel both dire and solvable, with a clear bias toward action and experimentation.

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For Further Resources

Visit followtheyellowbrickroadpodcast.com to access free guides, checklists, and new episodes.

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Summary compiled by [Podcast Summarizer AI], preserving content, intent, and tone of the original episode.

Transcript

[A]

The fastest way to break a business isn't by not having enough customers. It's by getting too many too fast.

[B]

A lot of people don't realize, but you can really grow yourself out of business because things just crumble and break.

[A]

If you look at customer service as something that just pulls money out of your business, you are making a mistake.

[B]

They should be your biggest advocates. The advancements in technology, even just thinking back five years ago, still would have been frantic. It's a wild time to revise.

[A]

Welcome to Follow the Yellow Brick Road, the show where online businesses learn how to turn clicks into content customers and growth into real scale. I'm your co host, Emma Rainville, the wizard of ops, helping companies transform chaos into systems that actually run.

[B]

And I'm Mitch Barham, the wizard of ads, the guy who knows how to turn paid traffic into predictable revenue. Together, we break down what really drives profitable online businesses. From traffic and funnels to operations, scaling and everything behind the curtain. Because getting customers is only half the battle.

[A]

The real magic happens when ads and operations work together. So if you want smarter traffic, stronger systems, and a clear path to scaling your business, you're in the right place. Let's follow the yellow brick road. So, Mitch, today we're talking about behind the curtain. Why most online businesses collapse after scaling ads. The fastest way to break a business isn't by not having enough customers. It's by getting too many too fast. And we see this in most online businesses, but also in the service business side of things and the agency side of things. So let's break it down.

[B]

Yeah, it's funny, a lot of people don't realize, but you can literally scale yourself, grow yourself out of business because things just crumble and break. I mean, I don't know where you want to start with the pieces that actually can break. I mean, from customer service to.

[A]

Let's start with that. Customer service is probably the biggest opportunity to keep things from breaking. Actually. So many people don't have good customer service and, and good sops around empowering customer service to help you deliver to your clients. They think customer service is a department that grabs refunds and processes them.

[B]

If only it was that simple, right?

[A]

Well, it shouldn't be. It should be a revenue producing department and, and it absolutely can be if you know what you're doing and how to do it. And so let's kind of start there, if you don't mind. Yeah, so the first thing is you need to be watching your customer service tickets. If you look at customer service as something that Just pulls money out of your business. You are making a mistake. You need to be thinking about. If I was sitting in the seat of X person, let's say it's a customer service manager, what would I do to increase my shareholder value? And so there's all sorts of things. Number one, creating retention programs of products that are info products that cost you nothing to give customers that you give to them in lieu of a refund. Cross selling customers who call in to purchase because for some reason they couldn't get behind the buy. So something happened at checkout and they weren't able to purchase. Happens all the time. If you have a big business, you know, it happens a lot. If you have a small business, you may not realize it, but it absolutely happens. So having your customer service agents automatically know that they offer the upsells that that person's never going to see is wildly important. Additionally, providing good customer service really does provide brand loyalty.

[B]

Yeah, 100%.

[A]

I have a company, Seismic Wave Support and we do customer support. And one of the things that all of them know is at the very end of the call. Thank you so much for your call today, Mitch. By the way, did you know that we have an affiliate program for all of our current customers and that you can earn money just by recommending or sharing this product with your friends? I can send you the link via text if you like.

[B]

Oh, I had no idea. I would love to know.

[A]

Yeah, people want to share with their friends what's working for them, whether it be a supplement or a service or whatever. So.

[B]

Well, not customer service rep, manager, whatever it is, is like they should be your biggest advocates for the brand.

[A]

Without creating FTC violations.

[B]

100.

[A]

But yes, absolutely, they should. They should be your biggest advocates. I don't have a physical product that I've ever promoted that my customer service agents didn't get a ton for free. Give it to your families. We even had one. I'll tell you a funny story really quick. One time we had a client who sold penis pumps. I really loved Richard and the owner of that business didn't value him for what he was for and wanted to get rid of him and did get rid of him. And the second I heard the news, I called him and I was like, I would love to pay you a referral fee if you allow me to hire him. And he was like, you don't have to pay me anything. You want to take that off my hands? Go ahead. Because in the UK there's like a whole thing where you have to, oh, you Continue to pay people after they don't work for you or something. Weird. That's how I hired Richard. And Richard, hands down the best hire of my entire career. I've hired some great people. Hands down the best hire in my entire career. I made him a partner in one of my businesses because I just absolutely. I think he's brilliant. Anyway, that went way over there. And now let's bring it back. We had penis pumps that we were selling and this company was an $11 million company, but we did a lot more wholesale than direct to consumer sales. So at the time we had five customer service agents and they were all female. And we g all penis pumps for their husbands, fathers and boyfriends.

[B]

I love that.

[A]

And we sold them on how good it was for their health. It's not what people think it is. It actually can prevent you from having a heart attack. Hospitals after you have a heart attack will oftentimes prescribe you one. What are the two biggest places in your body as a male that circulates your blood, your heart and your fetus? So there's no reason why they shouldn't experience your product. Even if it doesn't seem like a fit. They should absolutely experience your product. They should know everything about it, your product knowledge with your customer service team. There should be tests and additionally, every page that we have go out there, guess who the last QC is.

[B]

Customer service.

[A]

Why?

[B]

They're the front lines. They talk to the people. They know what they.

[A]

There's nothing that they won't know about the offer and what we offered because they QC it and they're going to see Mrs. In there because they talk to people all the time. So they know when they read this and they buy this and then they get this, this is what they're going to call us and say, let's go ahead and combat that in there.

[B]

Right?

[A]

The other thing I used to do all the time, I wish I still had time to do this because it was really great for me. Actually. Back when I was a drinker, I used to go into the bathtub on Saturdays about 8 o' clock with a bottle of wine and dry erase markers and I would sit and listen to customer service calls and all throughout my tiles would be notes from the calls. Pissed. Pissed my husband off. The grout, because it doesn't come out of the grout.

[B]

Oh, shit.

[A]

Pissed my husband off. I would try and keep it in the, you know, anyway, mid bottle that ended. But, but, but the things that I would get out of there from new products that we should sell. Because I'd hear over and over and over again, why don't you guys offer this or questions that would come up over and over and over again. We should be combating that in in the marketing. Not once the product is delivered, but. So yeah, 100 I'm with you.

[B]

Interrupt this podcast to ask you to do a huge favor for us.

[A]

Huge.

[B]

We drop so much knowledge to help you guys, but you're not going to be notified unless you hit that. Subscribe in the bell to be notified the minute we drop a new episode to help you grow and scale your business.

[A]

Because you never know when we're going to be taken off YouTube.

[B]

You have no idea. Like I could all of a sudden be like Liam Neeson with a particular set of skills.

[A]

Also, we read every single comment.

[B]

So leave a question or comment, we will reply to it and maybe we'll even talk about it in a upcoming episode.

[A]

Probably. If you troll us, we will definitely talk about you in an upcoming episode. Thanks. Customer support is a great place to put a lot of your time and in today's world, and we'll talk about this a little bit later at the end, but in today's world you can build agents that can find anomalies and patterns far faster than your human agents. And if you build them correctly, people will enjoy talking to them more. How many times have you called customer service or emailed customer service and asked for questions? Only got the answer to one and the question was what time it is and they told you Tuesday only every time. Or you tell them what your problem is and their first question is asking you what the problem is.

[B]

I love that.

[A]

And by the way Mitch, how are you enjoying your vacation? I just told you to refund me. It's awful. I got bit by an alligator.

[B]

Yes, but if you bring on too, if you have too many customers come in all at once and your people aren't trained right now, you have a bad reputation. But with the agent they can handle multiple things and answer all of those questions quickly, not ask you to stupid question after you already gave the answer.

[A]

I have only one client that doesn't have an agent first or last. Some clients don't want an agent first, sometimes they want an agent last. They want someone to answer the phone and say is it okay if I send you to an AI agent? I have two clients that like that wanted that. But I can go into this one client that doesn't have it and I can scroll through their customer service and I can probably find 15 questions that they asked today and it's 1247.

[B]

Oh, for sure.

[A]

And it's just from not paying attention

[B]

from call recordings that I can see with service based companies that we manage their ads for. I'm just like, oh my God, these poor people. Just same stuff over and over and over again. And you can almost. You could tell too, when like, because they're human and we get. We have emotions and we get snippy or, or annoyed or hungry and all of a sudden you're hangry. Like that comes across too. So anyways, yeah. Customer service is huge. I was even back in my day of the like my other businesses before the agency. Man, I wanted to get back to you so freaking fast. Via email, live chat, phone call. Because I wanted to make sure you were happy and taken care of so that you would be a lifetime customer as long as we were around.

[A]

Yeah. Okay. What's another one?

[B]

Your systems and operations. Yeah. Too many orders going out, too many new deliverables. They'll start slipping. Right. Because you don't have the right SOPs in place. You don't have the right communication channels.

[A]

I mean there's a gazillion things.

[B]

Yeah.

[A]

From not having enough inventory to if it's in info products that the middleware breaks because there are too many people crashing it all at once. That's something no one ever thinks about.

[B]

It happens all the time.

[A]

Merchant accounts.

[B]

Oh, yeah.

[A]

They have caps, particularly on subscriptions. You can really run that if you're not paying attention. Well.

[B]

Yep. Then all of a sudden they freeze your account or hold a bunch of your money.

[A]

My favorite is holding all your money. I get a 24% profit margin, which is pretty decent in an online physical product. And all of a sudden they're holding 30% of all money going through because I sold more.

[B]

Mm. Happens all the time.

[A]

Well, that's because they expect you to be a proper business owner and inform them because you knew your caps.

[B]

Yep.

[A]

And the worst thing you can do in that situation is call them and say you're holding all my money and I won't be able to pay my bills.

[B]

Yeah. You think they're gonna give you your money then?

[A]

No, no, no, no. They will not. They will actually hold more because it'll scare them.

[B]

Huh?

[A]

Yep.

[B]

They don't care about that. You always see that with PayPal, like in Stripe. Sometimes people complain about that and I'm like, I'm sorry, but in 21 years I've personally in any of my businesses because I advise people, you know.

[A]

Right.

[B]

Like when our Sales are about to take off. Like, hey, this is going to happen. Don't freak out. PayPal, don't freak out. Striped or even authorized.net Back in the day, never in 21 years had somebody actually hold any percentage of our money that came in.

[A]

Really?

[B]

Never? Once. It's the wildest thing probably, and probably an anomaly, but I've never had that happen.

[A]

Wow, that's.

[B]

Even Amazon. People will complain about Amazon. And I'm like, I never had these problems.

[A]

I've not had. I've never had a problem with Amazon. I've had them. A problem with Amazon stealing our products.

[B]

Oh, yeah.

[A]

And recreating them. That's a big one. I've had an issue. I can't think of one client I've ever had doing more than 2,3 million not having some type of reserve at some point.

[B]

Yeah, maybe I'm just in Washington, Lucky. I don't know.

[A]

We'll see.

[B]

I need to knock on wood real quick.

[A]

There's one behind you. There's. I love that you knocked on your head. For those of you listening on Apple podcasts or something like that. He knocked on his head.

[B]

You never know.

[A]

All right, what else?

[B]

There's so many things I can break because. Yeah, tech, inventory, customer service, people. You don't have enough people to fulfill the deliverables, then you gotta frantically go out and try to find somebody and somebody is probably not as qualified because you're literally panicking. Oh, my God, I have so many more clients I need to fulfill and you just go grab the first person ever. Which I think probably every single one of us has done.

[A]

I don't think that any of us have not done that. That's. But if you've been in business for 30 seconds, you've absolutely done that. One of the worst hires I ever had was. And it was. It really sucked. It was a friend of mine. He had come to visit. That's how close friends we were. And he saw that I was like, really struggling to keep up. I was working from 5 o' clock in the morning to like 9 at night. And he was like, I'm actually looking for a job. I feel like I could help. You know, why don't I come work with you? And it really sucked because, like, we don't even speak anymore. I had to fire him. It really, really sucked.

[B]

Yep.

[A]

But we've all done that quick, fast, easy hire, which usually costs us the most amount of money, doesn't it?

[B]

Yes. It ends up being a very costly hire. Far more than you would have thought. But yeah, because you don't want the deliverables actually fall through. I laugh because just the advancements in technology, even just thinking back five years ago, like, I mean it still would have been frantic, like, oh my God, I need to hire somebody. But now we don't need to do

[A]

that with, you know, AI, right agents, agenic agents, N8N MCTs. Like all of these things have now really changed that. Now it's I need to make sure I don't hire literally, literally the agents.

[B]

Like in my business we have I think 32 now at this point. It's like 5x the productivity of my existing employees. It's just ridiculous.

[A]

For me, I'm building agents in my main business, Shockwave, and our customer service based business is pretty much all agents. The very interesting part is I've not got rid of one person. In fact, I'm about to hire another guy in my business Shockwave, because having someone that understands how to oversee and manage the agents, they need to be managed just like people do. And so now my people have gone from doing things to managing the things that are getting done. The outputs are far more quality, they're done far quicker with far more accuracy and speed. And my team is able to establish the nuance that comes up because you have to. It isn't, I'm one person, I could never do it, I absolutely need it. But now instead of being able to service five clients, I feel like it's endless. And by the probably the end of this month, and as we're sitting here filming, we're 27 days into the month, probably by the end of this month, I'll be able to double what I'm capable of doing. I'm able to double it now. I could probably do 10 easy right now. By the end of this month, probably 20 easy because it'll no longer be. You build agents to build agents to build agents. And so what I mean by that is Agent 1 does the task, Agent 2 QA's the tasks. Agent 3 reviews the tasks as a manager. Agent 4 pushes it to my team and my team just. It's a quick review. It's no longer reading every line. It's basically giving it a quick scan and sending it out. It's an amazing time to be alive.

[B]

It's a wild time to be alive. That the amount of stuff that we can do, like, yeah, I mean to your point, I'm not getting rid of people. It's like, hey, it's making everything more efficient and they're doing more High level tasks like, you know, act like really being able to focus on the strategy and helping out in places of business that like we, as an ads agent

[A]

agency never could do before. Now you get to think, yeah, how crazy is that?

[B]

It's amazing.

[A]

Now you get to think, yeah, so

[B]

a lot of the repeatable tasks and all that, but like now you can insert these in to scale up your customer service very fast, to scale up any aspect you're ordering. I mean, you can even use these things for like inventory ordering if you train it right. So there's almost no bottlenecks in this day and age that a business should have.

[A]

Right.

[B]

Or drop the ball because you got too many customers. Like, oh, no, you can just scale up your, your CS agents because you can literally make these on demand.

[A]

You just close them over and over and over and actually you don't have to make anything.

[B]

100.

[A]

Yeah. It's a very, very simple thing. And I love the new product you and I have, the AI workforce lab where we've just been coming together and teaching people how to do this. Because just seeing so many people in our community and that we know being able to just really grow and expand from being able to go out and get more leads to being able to service those leads and cultivate the leads, sell the leads and then deliver on the leads seamlessly, Seamlessly, it's been pretty crazy. So, yeah, great topic we had today.

[B]

Fun. It's good stuff.

[A]

That's it for today's episode of Follow the Yellow Brick Road where the wizard of Ads and the wizard of Ops break down what it really takes to to build and scale a profitable online business.

[B]

If you found this episode useful, make sure to go to follow the yellow brickroad podcast.com to check out the hidden control chamber for all kinds of awesome freebies, guides, checklists, everything that we do to grow businesses.

[A]

So hop over there and grab all those free resources in the hidden control chamber. And remember, getting traffic is one thing. Turning it into customers that build the systems to support real growth, that's where the real magic happens. Until next time, keep following the yellow brick road.