2 Ways an Acquisition Can Help Your Agency Grow Faster
Do you feel like your agency has reached a plateau? Do you want to speed up your agency's growth but not sure how? Are your clients looking for more? An acquisition can be a great way to diversify your agency's offerings and bring new life into the business.
In today's episode, we'll cover:
- 2 Ways a merger or acquisition can help you grow your agency faster.
- #1 component of a successful merger or acquisition.
- Why your partners should always agree on an exit strategy.
Today I talked to Jim Hawker, co-founder and head of sales and marketing at Threepipe, a digital marketing agency based out of the UK. Early on, Jim realized the value of mergers and acquisitions to not only grow his agency but also streamline internal processes. He's here to talk about what's worked (and what hasn't) along the way.
2 Ways a Merger or Acquisition Can Help You Grow Your Agency Faster
It's hard to grow a successful agency without reaching a point where you hit a plateau. A place where it seems like no matter what you do, your agency's growth is just kind of stagnant. A merger or acquisition is a great way to give your agency a kick start and mix things up. But just how exactly does this work?
- Streamlined hiring: Jim says it has always been a part of his agency's strategy to go out and acquire talent. While you can find success when you hire and train, this process can take a long time and you'll often end up spending more money in the end. When you merge your team with another existing one, you expedite the process.
- Greater reach: Jim says he was finally able to expand his agency's service offerings after he went through his first merger. When he connected with like-minded owner-managers who complemented his service offerings, his agency was able to attract and land clients quicker than they had before.
#1 Component of a Successful Merger or Acquisition
Jim says ultimately he chose the right agencies to work with along the way. That said, it took three or four years for the two newly merged agencies to learn how to work with each other. The number one mistake Jim says his agency made was forcing people to work together and figure it out on their own.
I've talked about it before and I'll talk about it again — when you merge with another agency, you have to consider whether it's a culture fit. Take some time to get to know the other agency, what their vision is, and if they align with your own core values. Skip this step and you're going to have a hard time finding success.
Want to truly get to know who you will be partnering with? Spend time in the office and see if their team is happy. Or as Jim puts it, "Go on a few dates before you pop the question."
Why Your Partners Should Always Agree on an Exit Strategy
You never want to enter a partnership without having a plan for how it will end. What happens if one of the partners wants to leave the agency? What if there is death or illness? How will you determine the value of the business? An unexpected dissolution can destroy an agency if there isn't a plan in place. If you agree to all the details ahead of time, you'll have a legal document to go back to in the event the partnership ends.
You can't build a successful agency without taking risks. Sometimes the right risk is merging with another agency. Remember why you started your agency and don't be afraid to keep taking chances that can help your agency grow.
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