Agency2 min read
AI automation agencies: what changes about the structure (very little)
The pitch is new, the delivery is new, the margins are usually better. On every axis that decides an entity, an AI automation agency is an agency.
Published
This page exists because the question is asked constantly and the honest answer is short: read the agency guide. The structure is the same, the S-corp arithmetic is the same, the classification risk is the same.
Three things do differ enough to be worth stating.
One: you are reselling capacity
If you pay for model API usage and pass the cost to the client, that is the same principal-or-agent question media agencies face with ad spend. The full version is in pass-through ad spend; the short version:
- Client's own API key on their own account — cleanest. The cost never touches your books.
- Your key, rebilled at cost — an agency arrangement if the contract says so; otherwise it inflates your revenue.
- Your key, marked up — you are a principal reselling capacity, and the gross is genuinely your revenue with a genuine cost of goods against it.
The third is a legitimate and often profitable model. It just means you carry the margin risk when provider pricing moves, and you should know that is what you have chosen.
Two: who owns the automation
The deliverable is usually a configuration — workflows, prompts, integrations — built partly from your own reusable library. That is genuinely ambiguous unless the contract resolves it, and both parties will later believe they own it.
| Term | What to say |
|---|---|
| The client's build | They own the specific configuration created for them |
| Your library | You retain your reusable components, prompts and patterns, and the right to reuse them |
| Where it lives | Whose platform accounts host it, and who pays the subscriptions |
| What happens at the end | Handover, credentials, and whether you retain any access |
| Maintenance | Who is responsible when a provider changes an API and it breaks |
Three: what you are promising
Automation engagements are often sold on outcomes — hours saved, leads handled, tickets deflected. Outcome promises are commitments, and a limitation of liability capped at fees paid is what keeps a disappointing result from becoming a claim for the client's business losses.
If the automation touches decisions about people — hiring, credit, insurance, healthcare — sector rules already apply to automated decision-making, and they apply to your client's use of what you built. Knowing that, and saying so, is part of doing the work well.
An ordinary company behind a novel service
Founders 8 holds the entity, the filings and the deadlines. The unusual part of your business should be the delivery, not the admin.
Build your workspaceThis is one section of the agency structure guide, which covers the entity choice itself.
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