Post #4 – How Agencies Are Valued

September 30, 2025

Filed under: Uncategorized — herringbone @ 8:15 pm

Ever wonder why one agency sells for 2× EBITDA while another gets 8×?

Here’s why: buyers don’t just look at your revenue. They look at the quality of that revenue.

Factors that influence valuation include:

  • Profitability – healthy margins matter more than top-line revenue.
  • Retention – do clients stay year after year, or churn quickly?
  • Growth – is your revenue trending upward consistently?
  • Niche – are you specialized in a valuable segment, or a generalist?
  • Team & Systems – can the business run without you?

I’ve seen two agencies, both doing $5M in revenue, sell for wildly different prices. One had sticky clients, strong margins, and a leadership team. The other had flat growth, founder dependency, and shaky books. The result? A 3× multiple vs. a 7× multiple.

Valuation is math, but it’s also storytelling. The story you can tell about your revenue, your clients, and your future potential matters just as much as the spreadsheets.

👉 Which of these factors do you think your agency is strongest in?

Contact us if you’re and agency owner and have considered selling or joining something bigger.

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