The latest session from the Agency Curve community gathered industry leaders and agency founders to explore the evolving landscape of mergers and acquisitions (M&A) within the marketing and communications sector. Against a backdrop of rapid technological change, global consolidation, and emerging ownership models, the panel shared personal experiences and strategic insights into how agencies can prepare for and succeed through the M&A process.
Evolving M&A Trends: From Holding Groups to Hybrid Models
The last five years have seen significant shifts in the agency M&A space. Traditionally dominated by large holding groups, the market now features a growing presence of private equity (PE) firms, Employee Ownership Trusts, and hybrid models - trade buyers backed by PE capital. This evolution has opened new avenues for agency owners, offering more flexibility and alignment with long-term growth goals. Private equity firms are increasingly active, viewing agencies as scalable, high-margin businesses that complement broader investment portfolios.
Motivations for Selling: Scale, Security, and Succession
Many founders are motivated to sell due to scale limitations, financial opportunity, or the burden of future-proofing their businesses - particularly in the face of emerging technologies like AI. Other common drivers include international expansion ambitions and the desire for operational support. However, not all founders are seeking a traditional exit; some are looking for strategic partners to help evolve their businesses without relinquishing total control.
Employee Ownership Trusts: A Rising Alternative
A standout topic was the increasing adoption of Employee Ownership Trusts (EOTs) as an alternative to traditional exits. EOTs enable founders to sell their businesses to employees, maintaining cultural integrity and operational independence while realizing financial value. For mission-driven or culturally distinct agencies, this model offers a tax-efficient route to succession without sacrificing identity or autonomy.
The Importance of Integration Planning
One of the most consistent insights shared was the critical importance of planning for post-sale integration. Many deals falter not due to financials, but because of cultural misalignment or poor communication post-acquisition. Successful integrations require clarity around leadership roles, brand positioning, and operational processes from day one. Buyers and sellers alike emphasized the need to treat integration as a strategic, people-centred process, not just a financial transaction.
Preparing for a Sale: Key Success Factors
Panellists stressed the importance of running a well-structured and financially sound business well in advance of pursuing a sale. Agencies with strong leadership teams, clear succession plans, healthy margins, and demonstrable growth potential are far more attractive to buyers. Professional advice, especially regarding tax, legal, and financial implications was deemed essential, with thorough due diligence processes being both intense and highly personal.
Cultural Compatibility Is Paramount
Beyond numbers, buyers are increasingly focused on acquiring teams, not just assets. Founders are often expected to stay on post-sale, continuing to lead their businesses through the next stage of growth. Cultural alignment, mutual respect, and shared vision are essential for long-term success.
Challenges and Reflections
Founders shared candid reflections on the emotional toll of the M&A process - from relinquishing control to navigating the complexities of integration. Many described the experience as both exhausting and rewarding, emphasizing the importance of understanding one’s motivations and being honest about desired outcomes. While some went on to lead new initiatives within their acquiring companies, others found fulfilment in enabling broader employee participation and redefining their roles.
