Marketing agencies are no different. In terms of valuation, we see 90% of marketing agencies fall between is 2 – 3.5 X annual profit. Where your business fits into this valuation spectrum is determined by how your business fits the following criteria.Oct 31, 2019
REV Multiple. According to our data, advertising agencies sell for an average of 0.40x – 1.68x revenue multiple. You can calculate the implied value of the business by multiplying the amount of revenue or sales an advertising agency makes by the valuation multiple.Sep 2, 2021
What multiples do marketing agencies sell for?
Most digital marketing agencies with revenues over $8M sell for about 8–12x EBITDA. Agencies with revenues under $8M generally sell from about 1.5X-4X EBITDA. Sophisticated strategic buyers look much deeper.
How much can I sell my digital marketing agency for?
Digital marketing agencies can sell from anywhere between 1.5X – 7X EBITDA, depending on a multitude of factors. There are some obvious factors that determine how much your digital agency is worth, like the size and revenue structure (project vs. retainer based).
What is a good profit margin for an agency?
According to industry benchmarking data, marketing agency averages a net profit margin somewhere between 6.0% and 12.0%, which means there's plenty of room for growth. For the agencies we work with, generally the bogey is a 15.0% net margin. No agency is powerless to overcome poor margins.
How do you value a marketing company?
- Tally the value of assets. Add up the value of everything the business owns, including all equipment and inventory. ...
- Base it on revenue. ...
- Use earnings multiples. ...
- Do a discounted cash-flow analysis. ...
- Go beyond financial formulas.