We’re delighted to announce that we’ve successfully completed our first round of fund raising and will be announcing our first acquisitions in the next few weeks. Our new investors are committed to supporting us over the long term and with their active support we can now execute our business plan of acquiring up to six creative agencies each year.
We’ve held numerous discussions with agency owners throughout 2018 and as a result our pipeline is looking extremely healthy. We’d expect a number of these prospects to convert into acquisitions in 2019 and beyond.
These conversations have given us a real insight into both the opportunities and challenges facing smaller creative services firms and as a result, we’ve refined our terms so as to make our offer even more appealing to them.
Despite what some might call a turbulent business backdrop (!), our glasses remain resolutely half full and we still believe that smaller, well managed boutique-style agencies with their relentless focus on creativity and customer service will always have a bright future. We’ve not been surprised to see how many of the agencies that we’ve been talking to are punching well above their weight and delivering real value to their clients.
But Challenges Lurk
Our glasses may be half full but they’re not rose-tinted. Smaller creative services firms may be fun places to work in but they can’t offer the structured career paths that larger agencies do which means that, as the much-heralded war for talent hots up, they may not come out the winners.
With less capital available to them they’re less able to invest in productivity-enhancing (and margin-boosting) business systems and processes. And if clients are under pressure to consolidate their agency rosters then those offering a less expansive service portfolio will be the first to go.
For many owners then, about now seems to be the right time to exit their business and realise some of the value that they’ve built up in them over the years.
All the conversations that we’ve held in the last few months have given us a chance to ‘listen hard’. And we’ve now converted that listening into creating a more appealing exit strategy. We genuinely believe that we can now offer those agency owners who are considering one a fair and equitable exit route.
We’re going into 2019 fully funded, with supportive investors behind us and a business plan that we think is ambitious yet achievable. No wonder our glasses need refilling too!