When it comes to selling your agency, timing is everything. The best time to sell is when you don’t need to sell—when your business is thriving, your life is balanced, and you’re enjoying the fruits of your labor. On the other hand, if you’re desperate to sell because of financial stress, personal reasons, or burnout, you’ll likely find yourself in a weak negotiating position, forced to accept less than what your agency is truly worth.
The Pitfalls of Selling Out of Desperation
Desperation is the worst reason to sell your business. If you’re in a situation where you must sell quickly—due to financial difficulties, personal issues, or simply burnout—you’re at the mercy of buyers who can sense your urgency. They know you’re not in a position to hold out for the best offer, and as a result, they’re likely to lowball you.
- Weak Negotiating Position:
When you’re desperate, you can’t afford to be selective. You may have to accept the first offer that comes your way, even if it doesn’t reflect the true value of your agency. This can be particularly painful if you’ve spent years building your business from the ground up. - Missed Opportunities:
Selling under pressure means you won’t have the time or flexibility to explore multiple offers, find the right buyer who shares your vision, or negotiate favorable terms. Instead, you’ll be forced to take what you can get, which could mean leaving a significant amount of money on the table.
The Best Time to Sell: When You Don’t Need To
The ideal time to sell your agency is when you don’t need to. This might sound counterintuitive, but it’s the key to getting the best possible deal. When your agency is running smoothly, generating healthy profits, and providing you with a balanced lifestyle, you’re in a position of strength. You have the luxury of time to explore your options, entertain multiple offers, and choose the one that best aligns with your goals.
At our firm, we often work with clients who come to us with the goal of selling their agency within the next five years. However, our approach is to help them build an agency that they never want to sell. Why? Because that’s when they’ll receive the most attractive offers.
Building an Agency You Don’t Want to Sell
Imagine this scenario: Your agency is generating $5 million in revenue with a 30% EBITDA margin. You work just 30 hours a week by choice, not necessity, and you’re still taking home a seven-figure salary. The business is supported by strong leaders in every department, ensuring smooth operations whether you’re there or not. You have a steady stream of leads and new clients, and client retention is sky-high because you consistently deliver great results. Plus, you have the freedom to spend time with your family and take vacations whenever you want.
Why would you want to sell that business?
The reality is that if you’ve built an agency like this, potential buyers and investors will see the value in it. They’ll recognize the growth potential and the stability you’ve created, and they’ll be more than happy to cut you a great check to take it off your hands. However, because your life and business are in such a good place, you’re in no rush to sell. This gives you the upper hand in negotiations—you can afford to wait for the right offer, from the right buyer, on the right terms.
The Value of a Well-Run Agency
A well-run agency with solid financials, happy clients, and a strong leadership team is incredibly valuable in the eyes of investors. They know that this type of business has a high likelihood of continued success, which makes it a low-risk, high-reward investment. When they see that you’re not desperate to sell, they’ll understand that they need to make you an offer you can’t refuse.
Moreover, a successful, well-oiled agency is more than just a source of income—it’s a lifestyle. It gives you the freedom to enjoy life while still being involved in a business you love. This is why we encourage our clients to focus on building an agency they never want to sell. When you reach this point, selling becomes a choice, not a necessity, and you’ll be in the best possible position to get the deal you deserve.
Conclusion
The best time to sell your agency is when you don’t need to. By focusing on building an agency that runs smoothly, generates healthy profits, and provides you with a balanced lifestyle, you’ll create a business that investors are eager to buy. And because you’re not desperate to sell, you’ll be in a strong negotiating position, able to hold out for the best offer. The moral of the story? Build an agency you never want to sell, and the right offer will eventually come your way.