Agency Clinic with The DRUM Network

A few weeks ago, we facilitated a clinic with our friends at the Drum Network for agencies who had completed an agency valuation in January to help them understand how they were progressing with increasing value. 

Without revealing any sensitive information, the session highlighted a few insights that we’d like to share with you. 

1. Although agency valuations fell short of their expectations causing some dismay, agency founders appreciated the clarity on the reasons behind the value multiple. The multiple was 20-30% lower than they thought or were previously advised on.  
2. A valuation of an agency generates much debate amongst shareholders and leadership, so be prepared to answer a few awkward questions and get everyone aligned to ‘what next’. 
3. Review and refine the agency business plan so that the drivers and risks highlighted in the valuation can be prioritised. Agencies are brilliant at adapting and evolving themselves. 
4. Agencies are heavily reliant on the growth plan to increase its value – ‘if we grow, we will increase our value’. However, not at the expense of the culture and the agency’s core proposition. 
5. Develop a coherent and discipline action plan that can be easily delegated to the broader agency management team. Why shouldn’t everyone own part of building the value of their agency. 
6. Remain confident and resilient because your agency will deliver the next step of increasing the multiple from 5.2 to 6.2 x profit.