You didn't invent the multiple

Multiples come from buyers. They were never designed to get you a good price.

Every founder knows the going rate. The formulas have been stable for thirty years: a certain EBITDA earns a certain multiple, and on that basis your agency is worth eight times whatever. The trouble is that the formula is not a promise. It is the buyer's opening anchor, and everything that happens next moves in one direction: downwards, as they discount for every risk they find.

No succession team, discount. One client too big, discount. A proposition nobody can distinguish from the agency next door, discount. Gross margins that wobble, a pipeline that is really the founder's address book, a leadership team that has never made a decision alone: discount, discount, discount. Due diligence exists to find these things, and it will.

In the US market this bites harder than anywhere. A very large generation of agency owners is trying to sell to a small pool of buyers at once. Buyers do not need to negotiate hard; they simply move to the next agency on the list. You have to be clean to sell at all, let alone at the top of the range.

The full repair job takes about a year, and the improved numbers take another year to show up in your accounts. So the window to start is roughly two years before you want out. I sit on agency boards to run exactly that programme.