Insight: What to Consider When Selling Your Agency
Multiples make for a clean headline. They rarely make for an accurate one.
Our founder Hattie Marsden recently joined Marketing-Interactive's Marketing Connected podcast for an episode on what founders should actually weigh up before selling their agency. It's a conversation we'd recommend to any founder in marketing services thinking about an exit in the next few years, and a few points from it are worth pulling out here.
Multiples are an algebra equation, not a headline number
The most common mistake founders make is treating a multiple as a single, comparable figure. It isn't. A 12x EBITDA multiple sounds impressive until you ask which year's numbers it's based on, and whether the business is about to materially outgrow them. A 1.4x forward revenue multiple can be genuinely strong or fairly ordinary depending entirely on whether the buyer's definition of revenue includes future cross-sell opportunities. As Hattie put it on the podcast, valuation is really an algebra equation: it depends on which line of the P&L you're applying the multiple to, whether that's profit before or after tax, and which year you're looking at. The number that gets quoted publicly is rarely the number that matters privately.
This context is exactly why the current speculation around a possible Dentsu International sale, which we've covered separately, is so hard to price from the outside. The headline "multi-billion-dollar business" framing tells you almost nothing about what a buyer would actually be willing to pay once profitability, growth trajectory, and deal structure are factored in.
Buyers are rewarding quality over quantity
2025 has been what Hattie described on the podcast as a year of polarisation. Deal volumes in advertising eased slightly through 2024, even as overall deal value rose, which tells you competition for genuinely strong businesses hasn't gone away, it's just concentrated on fewer of them. Buyers have become noticeably more disciplined: if a business's numbers slip below what was forecast during a live process, buyers are increasingly willing to walk rather than renegotiate down and proceed anyway.
On the podcast, Hattie outlined the five fundamentals buyers are consistently screening for: a genuinely best-in-class market position, strong growth (ideally in the region of 20% year-on-year), healthy margins in the 15-25% range, a management team capable enough to remove key-man risk from the equation, and a client base with real enterprise-grade credibility. Businesses that can point to all five are the ones attracting competitive processes in an otherwise more selective market.
Preparation is what shortens the path to a good outcome
The operational side of a sale is where founders most often lose value they didn't need to. Unresolved issues that would normally surface in diligence, the kind of thing Hattie refers to as "skeletons in the closet," are far better addressed on your own timeline than discovered on a buyer's. It's also worth noting that earn-out periods have been shortening industry-wide, moving from the three-to-four-year structures common a few years ago down to 12-18 months, as private equity and strategic buyers push for faster integration. That compresses the window in which any post-sale surprises can affect what you actually walk away with.
What this means for founders
Run your business as if you're about to sell, not because you have to. The businesses that command the best terms are rarely the ones that scrambled to get sale-ready in the six months before a process started. Clean financials, a resilient management bench, and diversified enterprise clients are groundwork worth laying years in advance, not months.
Know your own reasons before you talk to anyone else. Hattie's advice on the podcast was direct: be honest with yourself, your advisors, and any co-founders about why you're actually selling. That clarity shapes everything downstream, from how you negotiate structure and earn-outs to how you communicate the transition to your team once a deal is signed.
Don't let a quoted multiple do your thinking for you. Before you anchor on any number you've seen in a press release or heard from another founder, ask what P&L line it's applied to, what time period it covers, and how the buyer is defining revenue. Two deals that look identical on the surface can represent very different outcomes once those variables are unpacked.
If you're starting to think about timing, structure, or simply what "sale-ready" would actually look like for your business, we're happy to talk it through. Our full breakdown of Marketing Services M&A in APAC, including the six-segment framework, deal multiples, and our READY framework for exit preparation, is available in the whitepaper below.
[Download the full whitepaper: Growth and Consolidation, A Deep Dive into Marketing Services M&A in APAC →]