Professional & B2B Services · Buyer guide
Buying a Marketing Agency business
Published · Reviewed by The Diligence Standard Team · Updated
a Marketing Agency can look attractive on a summary P&L while the operating details underneath it change the cash flow, transferability and capital a buyer will actually own. Diligence should connect the reported earnings to the business-specific drivers that create them.
How the business works
Retainer mix, client concentration, gross margin by service, talent retention and owner-led sales determine value.
Risks to test
- Owner-led sales
- Client concentration
- Key creative/media talent
- Project revenue volatility
- Platform dependence
- Unbilled scope creep
Evidence to request and reconcile
- Client revenue/contracts
- Retention/churn
- Staff payroll
- Project margins
- Pipeline
- Platform/ad account ownership
Decision questions
- Who owns client relationships?
- What revenue is truly recurring?
- Which employees are critical?
- Do project margins include all labor?
- Who owns client ad/data accounts?