Thinking of Selling Your Web Design Business?

If you are thinking about selling your web design business, web design company or digital agency, we would be interested in having a confidential conversation.

ALT Agency is actively looking to acquire established UK agencies with strong teams, long-term client relationships and profitable businesses.

We are looking to acquire well-run agencies rather than freelance client portfolios or one-person businesses. If you have built an established agency and are considering a sale, we can discuss what the business looks like, what you want to achieve and whether there could be a good fit.

Any initial conversation will be treated confidentially, and we are happy to put an NDA in place where appropriate.

Why sell a web design business?

There are plenty of reasons why you might consider selling your web design business. You may be thinking about retirement, looking for a change, or feel that the agency has reached a point where somebody else could take it further.

For owners of established agencies, selling is rarely just about the final price. You are also likely to care about what happens to your team and clients, whether you need to remain involved after the sale and whether the buyer has the experience and funding to complete the deal.

Those are all things we would want to understand from the outset.

What type of web design business are we looking to acquire?

We are primarily looking for established web design and digital agencies generating EBITDA of more than £100,000 per annum.

A good management team is particularly important to us, as are experienced members of staff who have been with the business for some time and want to remain after an acquisition.

We also look for:

• Strong, long-term client relationships
• Recurring or contracted revenue
• Sensible contract lengths and notice periods
• A good spread of clients rather than heavy reliance on one account
• An established in-house team
• Limited reliance on the owner for key client relationships or day-to-day decisions

We are not generally looking to acquire one-person web design businesses where most of the work is subcontracted.

Turnover alone does not determine whether an agency is right for us. A profitable business with a strong team, dependable clients and solid foundations may be a better fit than a larger agency without those qualities.

How much is a web design business worth?

Agency owners understandably want to maximise the value of what they have built, but asking prices and realistic valuations can sometimes be very different. We start with the numbers rather than a headline valuation.

We would normally review at least three years of accounts, establish a maintainable EBITDA figure and then consider an appropriate multiple based on the strength and risk of the business.

We would look beyond the profit shown in the accounts and examine the underlying numbers. For example, are the senior directors/shareholders properly accounted for by way of salary received? If not, this may result in an adjusted EBITDA as an example.

There may also be legitimate one-off costs or other add-backs that should be taken into account.

We would also look closely at the quality of the revenue, client contracts and notice periods, reliance on individual clients, strength of the management team and how dependent the agency is on its owner.

Two web design companies producing the same EBITDA can therefore have very different valuations. Our aim is to reach a realistic value based on how the business actually operates and the profit it can maintain after a sale.

What happens to you, your team and your clients?

The people and relationships within an agency are an important part of its value.

A strong management team and long-serving staff provide continuity, while established client relationships are a significant part of the value of the business. We therefore want to understand both and how they can be maintained through the transition.

Your own involvement will depend on what is agreed. Some owners want a clean exit, while others remain involved for a period to help transition clients, responsibilities or management.

We would agree that as part of the deal rather than assume the same approach works for every business.

How could the acquisition be structured?

Not every agency acquisition needs to be structured in the same way. Depending on the business and what both sides want to achieve, a deal may include a payment on completion, deferred payments, an earn-out period or a combination of these.

Where an earn-out is involved, we would agree how long it lasts, what it is based on and what you would need to do during that period.

Importantly, we have capital available for acquisitions. That means we can focus on whether your agency is right for us, what it is worth and how a sensible deal could be structured.

How does selling a web design business to us work… and why are we buying?

We are an established web agency since 2006 and have grown successfully year on year through organic growth. We now want to accelerate that process through strategic acquisitions.

If you are considering selling your web design company or agency, the first step is a confidential conversation.

We would initially want to understand you, what makes you tick, and the business at a high level, including its profitability, approximate EBITDA, team, client base, recurring revenue and your own role within the agency.

If there looks to be a good fit, we can then review the business in more detail. This would typically include three years of accounts, any proposed EBITDA adjustments or add-backs, client contracts and notice periods, reliance on individual clients and relevant staff information. From there, we can discuss valuation and how a potential acquisition could be structured.

If both sides want to proceed, we would carry out the necessary due diligence before agreeing final terms, completing the transaction and beginning the agreed transition.

Why sell your web design business to ALT Agency?

We have been building and running ALT Agency since 2006, so we understand what goes into developing a team, retaining clients and building a successful agency. You can read more about ALT Agency and our team .

ALT was founded by Craig Murphy , and our acquisition activity is supported by John Byfield , a consultant to ALT with extensive experience in acquisitions and corporate growth.

John founded Essentially Group, took the business onto AIM and grew it through acquisitions before it was acquired by Chime Communications. John continues to advise both public and private companies.

Alongside that experience, we have the capital available to complete acquisitions and an established agency team already in place.

We are not simply looking to buy a list of customers. Instead, we want to acquire established web design and digital agencies with good people, strong client relationships and solid foundations for continued growth.

If you’re considering selling your web design business, get in touch for a confidential conversation about whether your agency could be a good fit for ALT.