In this episode of Trunk Talks we speak to Stuart Goldstein, Executive Director of Operations at McCann Healthcare about his numerous management roles where he oversaw numerous agency acquisitions. These included agencies such as i33 Communications, 360i, Dentsu as well as Tenthwave Digital. Now, he oversees operations for two health and wellness agencies at McCann Healthcare in NY
Stuart discusses a number of ways agencies can keep their financials clean by having periodic audits or bringing in the right financial advisor to help keep the books in order. This means putting the right systems in place that would allow the agency to scale rapidly. Investing in current systems and processes creates more value for the agency, as acquirers are more interested in the last twelve to eighteen months financials versus the past five years which many agencies focus on. Not skimping on these important operational investments allows agencies to be ready to scale through an acquisition easily and efficient.
The last thing an agency wants is for current clients to find out about the acquisition of their agency through a press release. However, agencies should be tactical with when this information is disclosed. Generally, the right time to get customers on board with the sale is when the terms of the transaction are in place. A good way to make an official introduction to the new team is to get the acquiring executives to do a “roadshow” where clients can get comfortable with the new members. This is also a good opportunity to show clients the new services and networks they may have access to, while demonstrating that they’ll still receive the same level of service and attention in the new set up.
It’s important to align the culture between the agency and the acquiror. The company should be sensitive to employees that enjoy working in a small business and may not want to be a part of a large corporate organization. It’s important to make sure the aspects of the culture that make the agency are preserved and that nuances like changes in title don’t have material effects on employees’ salaries and bonuses. Stuart advises owners to never sell just for the money, but instead make sure you actually like the people you’re selling to. Be transparent and upfront about your goals in the beginning.
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