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Raster vs vector for logo design - my client taught me a hard lesson

I spent 3 hours on a logo in Photoshop for a local coffee shop in Portland. Looked great on screen. Then they wanted it on a billboard. The raster file turned into a pixelated mess when I scaled it up. I had to rebuild the whole thing in Illustrator from scratch. That extra time cost me $200 off my usual rate. Now I only start logos in vector, even for small jobs. Has anyone else had a project blow up because you picked the wrong file type?
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walker.julia
Funny you mention Portland. My cousin runs a food cart there and had a guy design their logo in Microsoft Paint of all things. Sent them a .bmp file. They tried to print it on a banner and it looked like someone dropped a pixel bomb on a hot dog. The cart is called "Dirty Dog" and the logo was this scrappy little wiener dog. They spent months telling people it was supposed to look intentionally blurry as a style choice. Total disaster. I think about that every time I see a shop with a weirdly fuzzy sign.
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