Most agency owners don’t start their business thinking about an exit.
They start because they’re great at something (design, development, strategy), and want to build a better life doing it. But somewhere along the way, the question inevitably comes up:
What is this business actually worth, and how do I make it valuable?
In a recent conversation on our podcast, Creative Outcomes, Albert Banks, former agency founder turned advisor, shared what he’s learned from building, merging, and ultimately selling his agency after 20+ years in the professional services world.
This isn’t a story about chasing an exit. It’s about building a business that could exit, and why that mindset changes everything.
1. Run Your Business Like You’re Going to Sell It (Even If You Never Do)
One of Albert’s core philosophies is simple:
“You don’t have to think about an exit, but you should run your business like you’re going to sell it.”
Why?
Because the habits that make a business sellable are the same ones that make it:
- Profitable
- Scalable
- Less stressful to run
- More valuable (to you, even if you never sell)
The reality is that very few businesses actually sell; in fact, less than 1%. But the ones that could sell tend to be better businesses across the board.
2. “Operational Hygiene” Is What Separates Good Agencies from Great Ones
Creative excellence gets attention, where operational excellence creates value. Albert calls this the “unsexy work”, but it’s the difference between a business that looks good from the outside and one that can survive the scrutiny from buyers.
This includes:
- Clean, reliable financials
- Clear processes and documentation
- Defined roles and accountability
- Consistent, trackable performance metrics
Without this foundation, growth often comes with hidden problems:
- Revenue increases, but profitability doesn’t
- Teams grow, but efficiency drops
- Decisions rely on gut instead of data
If you can’t clearly explain how your business works, and prove it with data, neither can a buyer.
3. What Actually Drives Value (Hint: It’s Not Just Revenue)
One of the biggest misconceptions among agency owners is that valuation is straightforward. It’s not. While revenue puts you in a general “range,” what really determines value is everything beneath the surface:
- Profitability (EBITDA)
- Client concentration risk
- Retention (clients and employees)
- Growth trajectory
- Leadership structure
- Operational maturity
Two agencies with the same revenue can have wildly different outcomes depending on these factors. Revenue gets attention. Predictability and stability get paid for.
4. Most Founders Aren’t Built to Run a Business
Many agency owners are, at their core, craftspeople. They care about the work, the team, and their clients. They don't necessarily care about the financial modeling, operational systems, and forecasting. It's not a flaw, it's just reality.
The key is recognizing that:
You don’t have to do everything yourself, but you do have to own the outcome.
That might mean:
- Hiring an operator or CFO
- Bringing in a partner
- Using a framework like EOS
- Or working with advisors
You can stay in your zone of genius, but only if someone owns the rest.
5. Mergers and Acquisitions Don’t Fix Broken Businesses
Many founders see merging with another agency as a shortcut to growth or stability. But Albert’s experience highlights something important:
Mergers only work when alignment already exists.
In his case, success came from years of relationship building, cultural alignment, clear role definitions, and strategic rationale.
Without those, mergers often fail because leadership conflicts emerge, teams don't integrate well, or expectations don't match reality. A merger isn’t a solution; it’s a multiplier.
It amplifies whatever already exists (good or bad).
6. The Exit Process Is Emotional, Not Just Financial
Selling a business isn’t just a transaction. It’s an identity shift. For many founders, the business is their identity. Their relationships are tied to it; for some, it's their sense of purpose.
When it's gone, or even just changing, it can create some feelings of uncertainty. That's why planning for life after the exit is just as important as the deal itself. Don't just plan the exit, plan your next chapter.
7. Earnouts: Where Deals Are Won (or Lost)
A large portion of most deals comes through an earnout.
Typically:
- 50–70% is paid at close
- The rest depends on future performance
And this is where things get tricky. Earnouts often hinge on revenue growth, profitability, and employee retention. The biggest mistake here is setting goals that are unrealistic. It's important to negotiate for goals you can control, not just ones that look good on paper. If you set targets you can't hit, you're setting yourself up for failure.
8. Integration Is Where Value Is Created (or Destroyed)
Closing the deal isn’t the finish line; it’s the starting point. This is where many deals fall apart. Integration comes with new systems, new leadership structures, new expectations, cultural friction, all sorts of "new".
Albert emphasizes that preparation makes all the difference:
- Strong processes make transitions smoother
- Clear communication reduces disruption
- Defined roles prevent confusion
9. Sometimes the Biggest Wins Come Later
One of the more interesting dynamics in agency M&A is the “second bite of the apple.” If you roll equity into a larger company, you may benefit if that company sells again later, but you also lose control over the outcome.
It's essentially an investment, and like any investment, it can pay off big or not at all. Taking equity isn't just selling, it's betting.
Final Thoughts
If there’s one theme that runs through this entire conversation, it’s this:
Great businesses don’t become sellable by accident.
They become sellable because:
- They’re well-run
- They’re predictable
- They don’t rely on one person
- They can stand on their own
And whether or not you ever plan to sell, those are the kinds of businesses worth building.
If you want to hear the full conversation, including deeper stories on mergers, identity shifts, and the actual sale process, you can listen here: