8 Drivers of Value for Your Firm

Around 165,000 U.S. creative and tech firms could be preparing to transition ownership within the next five years.

And owners that think their retirement is in the value of the company could be in for a big wakeup call.

Profit ≠ Company Value

Plenty of businesses show healthy profit and still struggle to sell for strong multiples. Why? Because buyers pay for durability, not just past profit dollars.

Value is built on systems that keep results coming when the owner steps out.

Here are some of the value builders that buyers look for:

• Owner-independent growth: Owner isn't the one driving business development or deeply engaged in projects.

• Repeatable delivery systems: Standard offers, playbooks, clear handoffs, quality control.

• Balanced client mix: No single client is more than 20% of revenue + the firm has relationships at multiple levels of the client's organization.

• Reliable pipeline math: First, the pipeline exists. Second, the pipeline actually means something.

• Compelling, focused positioning and offering: Clear ICPs, easy to state why your firm is the best choice, and offerings aligned to the specific needs of your ICP. A "full-service agency that's different than everyone else because our people are the best" isn't that.

• Leadership & people: a bench that can plan, sell, deliver, and improve consistently.

• Clean financial hygiene: Your financial house is in order, reports are easy to run, and you consistently convert offers into cash.

• Process and data loop: processes are well-defined, but data and team feedback is always used to influence process updates to remove friction.

  It can be hard to think about systems when you're delivering bespoke solutions to your clients. But it's very much possible.
  
  Some questions to ask yourself...
  
  1. Could revenue grow for 2 quarters straight if the owner took at 6 month sabbatical (no checking in)?
  2. Could a CS/AM close an expansion deal with an existing client on their own?
  3. Would a top client stay if their key contact left?
  4. Is >70% of revenue delivered through documented, repeatable workflows?
  
  Did you hesitate on any of these?
  
  Profits start the conversation. Transferable, repeatable value sets the price.