What we've learned buying agencies (and why we're going to Dallas)
AgencyHabits is where we share what we’re learning at Barrel Holdings as we buy, build, and grow agency businesses. Acquisitions have been a big part of that work. Here are a few lessons from the process.
Buying is a growth strategy
When agency owners talk about M&A, they usually mean selling. That makes sense. For many owners, a sale is the culmination of years of work.
But buying is worth considering too. An acquisition can bring in a team, a client base, or a capability that would take years to build on your own.
That doesn’t make it a shortcut. It changes the work. You have to assess the business, structure a deal you can afford, and make sure the people and clients have good reasons to stay after closing.
Three things we wish we'd known earlier
Know what you're buying for. We publish our buy box: the size, location, margins, and leadership profile we look for. Writing it down forced us to get specific about what we wanted and why. Are we buying a capability, a client base, or a team? Each calls for a different approach. Having a clear answer makes it easier to assess opportunities and pass on the ones that don’t fit.
Decide early whether the brand survives. A standalone acquisition keeps its name and operates as a separate business. A tuck-in becomes part of an agency you already own, usually taking on its brand. Either can work. Problems arise when the buyer and seller have different expectations. We’ve found it’s worth discussing this early, because it shapes the conversation about the team, clients, and the founder’s role after closing.
Pay for the business as it is today. In our experience, valuations have generally landed between 3x and 5x EBITDA. It can be tempting to justify a higher price based on what we think we can do with the business. We try to stay disciplined about that. Future growth still requires work, investment, and risk. Start by understanding the current earnings, adjusting for items like the owner’s compensation and one-off expenses, before talking price.
And one more thing: closing the deal is only the beginning. Keeping the team and clients, building trust, and following through on your plans takes sustained attention. Make room for that work before committing to an acquisition.
Why we’re going to Dallas
It requires ongoing learning, and conversations with other agency owners are a valuable part of that process. It helps to hear how someone approached a deal, what happened after closing, and what they’d do differently.
That’s why we’re partnering with M&A Liftoff and heading to Dallas.
Whether you own one agency or several, acquisitions can be part of your growth strategy. If you’re considering that path, M&A Liftoff is an opportunity to meet others who’ve done it and learn a repeatable framework for approaching a deal.
We’ll be there and would love to connect.
AgencyHabits readers get 30% off any ticket with the code habits.
This article is part of a paid partnership with M&A Liftoff.
