Speaker 1 17:25
For everyone.
Speaker 2 17:26
They also have a very thorough due diligence process, due diligence to make sure they’re acquiring healthy and sustainable business, healthy and sustainable. Yeah, so they’re doing their homework. They’re doing their homework before making any big moves.
Speaker 1 17:42
They thoroughly examine the agency’s financials, client base operations team, yeah, name it.
Speaker 2 17:51
It’s like a full body scan for the agency, a full body scan, I like that, and they’re very transparent. Transparency is key with potential acquisition targets, yes, about their expectations, values and vision for the future.
Speaker 1 18:06
It’s about building trust, right, and making sure both sides are on the same page. Yeah, from the start.
Speaker 2 18:11
Jason emphasized that Republix isn’t just out to gobble up agencies for their revenue. That’s not just about the money they genuinely want to build lasting relationships with agency owners who share their passion for growth, innovation, client service. It’s a much more human approach to acquisitions. It is focused on partnership and shared success.
Speaker 1 18:33
Okay, so we’ve covered a lot of ground on Republix legs and their unique approach. Yeah. What about the bigger picture of agency acquisitions.
Speaker 2 18:41
The bigger picture.
Speaker 1 18:42
What are some of the key trends and challenges happening in the industry right now?
Speaker 2 18:46
One major trend we’re seeing is a lot of consolidation, consolidated big agencies and holding companies are snapping up smaller agencies at a rapid pace. So it’s becoming a bit of a feeding frenzy out there.
Speaker 1 18:47
Kind of — there are a few reasons for this. Okay, agencies need to scale up to compete, right? They want to access new capabilities and talent, okay, and they’re looking to expand into new markets.
Speaker 2 19:09
Makes sense. Bigger is better in a lot of ways, in a lot of ways, yeah, but what about the smaller agencies, the little guys? How do they survive in this increasingly competitive landscape?
Speaker 1 19:21
It’s definitely a challenge. Yeah, they might not have the resources or scale to go head to head with the Giants, right, right? So what are their options? What can they do? They need to find ways to stand out and prove their value. Okay? They might focus on specializing in a niche area, okay, offering strategic consulting or becoming masters of delivering measurable results.
Speaker 2 19:43
So it’s about carving out a unique space in the market and demonstrating their expertise.
Speaker 1 19:49
Exactly. So being small doesn’t mean you can’t be mighty. I like that. Yeah. Another big trend we’re seeing is the growing importance of technology and data in the agency world, technology and data, okay, clients are demanding more sophisticated solutions, right? And agencies need to keep up.
Speaker 2 20:08
It’s all about leveraging the latest and greatest tech, the latest and greatest tech, to deliver better results, better results. Yeah, think marketing automation.
Speaker 1 20:17
Marketing automation, data analytics. Given AI and machine learning.
Speaker 2 20:20
AI and machine learning.
Speaker 1 20:22
It’s a whole new world out there, but I imagine, yeah, all this new tech requires a lot of investment. It does, and that’s another challenge for agencies, especially smaller ones, especially smaller ones with limited budgets. The limited budgets, yeah, they need to be strategic. They need to be smart about their tech investments, about their tech investments and find ways to maximize their ROI, maximize that ROI. So it’s not just about buying shiny new toys. No, it’s about using those toys effectively, effectively to drive real business value. Real business value.
Speaker 2 20:55
And another curve ball agencies are facing is the rise of in house marketing teams, in house marketing and those freelance platforms and the freelance platforms so they’re getting squeezed from both sides.
Speaker 1 20:55
Kind of, as companies bring more marketing functions in house yeah, and explore alternative sourcing models. Agencies need to differentiate themselves, improve their worth.
Speaker 2 21:16
It’s all about showing those clients why they need an agency, why they need an agency, and what makes that agency unique?
Speaker 1 21:23
What makes that agency unique? Yeah.
Speaker 2 21:24
So the agency landscape is changing rapidly, with lots of challenges and opportunities, lots of challenges and opportunities. So what advice does Jason have for agency owners who are thinking about selling.
Speaker 1 21:35
Thinking about selling, okay, in this ever evolving market.
Speaker 2 21:38
His first piece of advice is to get your house in order. What does he mean by that? Clean up those financials. Okay? Make sure your processes are well documented, right, and have a strong leadership team in place. So basically, make your agency look as appealing as possible.
Speaker 1 21:54
As appealing as possible to a potential buyer. Potential buyer, yeah.
Speaker 2 21:58
Buyers want to see an agency that’s well managed. Well managed, profitable, profitable and ready to grow, ready to grow. Okay, so once your agency is looking spiffy, spiffy, what’s next?
Speaker 1 22:09
It’s time to think about your ideal buyer. Ideal buyer. What type of company would be the best fit for your agency?
Speaker 2 22:17
So are we talking a larger agency, a holding company, or maybe a private equity firm. It could be any of those. Each type of buyer comes with different expectations. Yeah, expectations, investment philosophies, investment philosophies and integration plans.
Speaker 1 22:33
And integration plans. It’s like choosing the right dance partner. Oh, I like that. You want someone who matches your style and moves.
Speaker 2 22:40
And once you have a buyer in mind, yeah, it’s important to be realistic about valuation. Valuation, yeah, don’t expect to become an overnight gazillionaire just because your agency is making a profit. No, no, no. Valuation is based on a lot of factors, including size, growth rate, growth rate, client concentration, client concentration, and market competition and market competition. So you might need to temper those expectations a bit, and be prepared for a long and winding road.
Speaker 1 23:08
A long and winding road.
Speaker 2 23:09
When it comes to due diligence, due diligence, ah, the dreaded due diligence. The dreaded due diligence. I imagine that can be.
Speaker 1 23:17
It can be pretty intense. It can be the buyer is going to scrutinize everything, everything like what, financials, contracts, client lists, employee agreements, intellectual property, you name it.
Speaker 2 23:30
It’s like having your entire business put under a microscope. Under a microscope, exactly. So any advice for surviving due diligence.
Speaker 1 23:37
Be organized, be transparent, okay? And have all your documentation ready to go.
Speaker 2 23:41
And probably a good idea to have a strong cup of coffee on hand, or maybe something a little stronger. But seriously, due diligence is where having those legal and financial experts on your side is crucial. It’s crucial they can help you navigate the process and protect your interests. Protect your interests. Yeah, it’s like having a team of bodyguards for your business. A team of bodyguards. They can help you avoid pitfalls, avoid pitfalls, negotiate favorable terms, favorable terms.
