Drawn from 25 years of building, scaling, and selling agencies as a founder, CEO, chair and consultant
Someone in Boston asked how to tell an agency that really operates differently with AI from one that mostly posts about it. The answer: look at what they've built. One agency turned itself around in three months.
Icons that label AI content clearly and give people a way to identify human content. They are silly, they involve a really bad pun, and you are welcome to use them freely.
Most American SEO agencies resell the same white-labelled platforms. AI has called that bluff, and buyers see thirty thousand agencies with no reason to exist.
In 2007 we showed Virgin Holidays every pound in returned twenty-six. The budget doubled. AI now asks every agency a blunt question. Efficiency is no answer.
Serious buyers no longer settle for the polished management meeting. Strategy days, secret-shopper enquiries and candid client calls inspect the team beneath.
Told his window had closed because valuations average three years, a founder started anyway. Most discount factors never reach the accounts. Offers followed.
A $3m agency with a $1m client expects $2.4m at four times profit. The buyer prices it as the $2m agency it would be without that client, at two times: $800k.
The going-rate multiple is the buyer's opening anchor and everything after it moves down. In the US, with more sellers than buyers, be clean or stay unsold.
Your multiple is not a grade for twenty years of work. It measures a buyer's confidence in cash flow after you have gone, and every visible risk lowers it.
Take inflation, wage inflation and one lost client off a 20 per cent growth target and the agency ends the year where it started. Two years, three times.
Your senior leadership team was hired to preserve what exists. Growth is a different job, done by a Growth Lab team drawn from every level of the business.
The charisma that gets an agency to its first million teaches the team to wait to be fed. Past two or three million that becomes a ceiling, felt as stress.
The best deal I ever did, I left seven weeks after completion, because the agency already ran without me. The alternative is three years working for a boss.
Six out of ten agency founders do not finish their own earnout, and buyers price that in. You become most valuable at the point you become unnecessary.
Good team, strong clients, four case studies on the website, the newest from 2022. One short case study a month roughly doubled contact page conversion.
All ten of an agency's last clients came through the founder personally. Nine months later, 40 per cent of new business came through channels without him.
From a coffee app built on a rainy Saturday to Scale at Speed AI, distilled from the book, a 160,000-word course and terabytes of workshop video.
Three clients left in eight weeks with no complaints and high survey scores. The work had drifted into maintenance. Nobody had done anything wrong.
A head of new business produced nothing in six months. The proposition could have described any mid-size agency. The next hire closed two clients in a quarter.
An agency's first real quarterly review found designers at 115 per cent utilisation and the biggest service line the least profitable. Half an hour of clarity.
If you’re serious about building significant value, preparing for an exit, or executing a roll-up strategy, get in touch below. I’ll respond personally.
His agency got 35 per cent faster with AI and clients asked for lower prices. He repriced around outcomes instead. Margins went from 22 to 34 per cent.
An agency lost a pitch to a rival offering half the timeline for the same scope. The rival had rebuilt around AI. The founder had not known the gap existed.
AI automated the research and first drafts that used to teach juniors how to think. A creative director rebuilt junior roles around judgment instead of output.
AI made the team 40 per cent faster, so they said yes to everything and margins dropped eleven points. Faster is only more profitable if you take back the time.
Asked how she knew AI was working, a founder said she could feel it. Eight weeks of before-and-after tracking on three workflows turned that into evidence.
One founder rebuilt everything around AI: forty-two people to twenty-eight, same revenue, margins roughly doubled. AI as infrastructure rather than a tool.
A new Head of AI spent three months on training sessions nobody used. Sitting with teams and fixing what took too long that week got them coming to him instead.
A client sent an AI addendum and two weeks to sign it. A procurement exercise, not a confrontation, and it forced the governance work that was overdue anyway.
Eleven people, four AI tools, three teams, and nobody knew where client data went. Regulated-client data sat in a free-tier tool. Fixing it took two weeks.
She built a serious AI capability and pitched it as efficiency. Clients wanted to know what AI meant for their own business. The outward-facing answer wins.
Three agency AI rollouts quietly failed as people drifted back to old habits. The problem was ownership, not resistance. People implement what they design.
Founders say their agency is at Level 2 or 3 on AI maturity. Ask about a legally reviewed policy, contract cover and data flows, and the answer is not yet.
An eight-year financial services client was lost because a strategist used free ChatGPT under a 2019 NDA. Nobody had told her not to. No policy existed.
She thought her agency was at Governed on the AI maturity model. No written policy, no data map, 2022 contracts. Governed is where you can safely accelerate.
Her new business came from referrals and she had no idea which clients sent them or why. A referral practice is a habit: know your advocates and ask.
Day rates unchanged since 2020 meant the agency cut its price by RPI every year while clients raised theirs. Raise prices annually, without apologising.
Two days in a country house produced a fifty-six-page strategy nobody could recall by January. Agencies that execute commit to fewer things, not tidier ones.
Strategy days produced plans nobody executed. A small team of future leaders who research, design and pilot the changes themselves changed the execution rate.
A founder celebrated his sale, then reread the earnout: three years of targets under someone else's strategy. Build the agency so the buyer does not need you.
A founder admitted most clients would leave if he did. Two years building a layer of people with real authority between him and them got a far better deal.
Founders guess their biggest client is 20 per cent of revenue. It is often 55. Above 30, buyers price the risk aggressively. Know the real number first.
I once built a service line in a month and buried it in three. The method I use now is slow at the front: research, small pilot, then roll-out.
A founder came to me wanting help selling their agency for several million dollars. After half an hour of pointy questions, I told them flat out: give it away instead…
A very wide-ranging interview by best selling author Minter Dial in which Felix discusses his values, the state of the agency industry, the science behind – and methods for – scaling, the mechanics of profit growth, goal setting and much more.
A detailed presentation of the mechanics of agency M&A, including the financial motivation driving agency acquisition, how to maximise your agency’s sale value, how to address discount factors and how to create a great exit.
This eye-opening article reveals the real reasons buyers pay top dollar and provides a proven framework for maximizing your exit value, drawing from Felix Velarde’s unique experience of founding, selling and acquiring agencies.
Exploring how leadership procrastination on major business decisions can be overcome by answering five key questions, emphasizing that effective leadership requires making decisive choices even when faced with uncertainty.
Agencies can achieve greater success and value by identifying and focusing exclusively on a specialised niche where they can be the best, rather than trying to compete as a generalist against thousands of similar firms.
