Buying a Marketing Agency in the Age of AI
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About this listen
In this episode the hosts break down a $4.3M SBA‑eligible niche digital marketing agency serving legal clients, exploring its strong growth, high margins, client retainer model, and the risks around leverage and industry uncertainty.
Business Listing – https://quietlight.com/listings/15442269/
Welcome to Acquisitions Anonymous – the #1 podcast for small business M&A. Every week, we break down businesses for sale and talk about buying, operating, and growing them.
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Tonnesen Accounting Services - Tonnesen provides full quality of earnings reports trusted by buyers, lenders, and brokers on over $500 million in deals each year. Fast, detailed, and affordable. Visit tonnesenaccountingservices.com or connect with Josh Tonnesen on LinkedIn for a free consult.
Capital Pad – A platform connecting accredited investors with vetted small business acquisition deals. Discover exclusive opportunities at https://capitalpad.com
In this installment of Acquisitions Anonymous, Bill and Michael are joined by Capital Pad co‑founder Travis Jamison to review an eight‑year‑old digital marketing agency focused on lead generation and strategic advertising for legal firms. With nearly $2M in revenue and ~50% year‑over‑year SDE growth, the agency boasts roughly $1M in income at ~50% net margins, 65 active clients on retainer, and no concerning client concentration. The seller has built a team of about 10 people, works only 20 hours a week, and the business is SBA‑eligible — though with a caveat around debt coverage if the new owner wants to draw a salary.
Key Highlights:
- Business Size & Growth: ~$2M revenue, ~50% net margins, ~47% year‑over‑year SDE growth.
- Model: Digital marketing agency specializing in legal firm lead generation and retainers.
- Client Base: ~65 active clients averaging ~$3,200/mo each with no heavy concentration risk.
- SBA Notes: Eligible for SBA lending, but high multiple means max leverage might preclude owner salary.
- Risks Noted: Changing digital marketing landscape, debt coverage concerns, founder dependency on relationships.
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