Are you currently working as a freelance WordPress expert but you want to appeal to more high-profile clients? Or maybe you have your own company but want to expand quickly. Either way, you might be thinking about buying a WordPress agency.
This will give you access to a diverse client list, experienced employees, and sometimes, intellectual property rights. That said, it’s important to determine the quality of WordPress agencies first, by looking at the growth potential, brand reputation, recurring revenue, and more.
In this post, we’ll discuss why it might make sense to buy a WordPress agency. Then, we’ll explore ten factors to consider to help bring about a successful merger or acquisition. Let’s get started!
Why should you buy a WordPress agency?
WordPress agencies offer a range of services focused on the WordPress CMS platform. Typically, they encompass web design services, WordPress development, security enhancements, search engine optimization, and ongoing maintenance and support.
It might be the case that you want to set up your own WordPress agency. Perhaps you’ve been working as a freelancer and you’d like to expand your client base. Buying an agency is a great way to do this since it can be a more trustworthy and reliable solution compared to hiring freelancers.
Even if you’re already running a small or mid-sized company, buying a WordPress agency enables you to quickly scale up. You could get access to experienced WordPress designers with niche expertise, which can add value to your business.
You might also gain exclusive access to specialist products like software or technology that’s protected by intellectual property (IP) rights. Better yet, buying a WordPress agency is a ready-made solution that doesn’t require a significant time investment.
Other ways to grow your small agency may involve finding more clients, onboarding new talent, developing your own products, or acquiring different skills. All of these ventures can be time-consuming and some of them involve a significant financial investment.
10 Factors to consider when buying a WordPress agency
Now that you know why it can be a good idea to buy a WordPress agency, let’s take a look at ten important factors to consider before you begin the process.
1. Team expertise
When you buy a WordPress agency, you’ll usually get access to the existing team of designers, developers, SEO experts, team managers, and more. The bigger the team, the more you’re likely to benefit from a wide variety of skills and expertise.
Perhaps the team has insight into new markets that you’re looking to venture into. Or, they possess rich knowledge about a specific area within the WordPress space.
This can give your agency a competitive edge over general-purpose WordPress agencies. Specialist skills can also be leveraged to attract different types of clients, raise your service prices, and set up extra revenue streams.
2. Previous work
People looking to sell WordPress agencies are often capable of talking a big game to attract buyers like yourself. That said, it’s important to go and do some digging of your own to make sure that the work is up to your standards.
If the agency has its own website, you should be able to access featured work, case studies, or a portfolio. Here, you can usually find details about previous projects including timelines, industry, and the team members that worked on it.
If this information isn’t readily available, it’s a good idea to request a look at past projects or case studies. Naturally, the opinions and experiences of past clients are also a key consideration, but we’ll get into that later on.
3. Growth potential
Your goals will be crucial in determining the growth opportunities available at various WordPress agencies. But, it’s a good idea to consider this step with a forward-thinking attitude.
What does the future of WordPress development look like? How will new technologies like artificial intelligence (AI) continue to be implemented across websites? Will you be able to constantly evolve within an ever-changing industry?
Perhaps you’re keen to expand into new markets, offer a more niche service, or target high-profile clients. Sure, looking at the agency’s revenue, client lists, etc can help. But ultimately, you need to reflect on your exact business goals and where you see yourself five or ten years from now.
4. Current client base
Another important factor to consider when buying a WordPress agency is the client base. Typically, a larger pool of clients is more appealing since it’s less risky than acquiring an agency that relies heavily on one or two large accounts.
You may also need to think about the industries that current clients operate in. Perhaps you’re looking to work with a highly targeted client base, or maybe you’d prefer to fulfill a diverse range of needs.
On top of this, you’ll want to assess the quality of these partnerships. How long have the clients been onboard? WordPress agencies that can demonstrate long-term contracts and low churn rates can increase confidence in your purchase.
5. Revenue and profits
Although revenue is certainly a critical consideration, many potential buyers make the mistake of limiting their search to agencies with a very high return on investment (ROI).
We’re not saying this isn’t important, but it’s simply one factor among many that indicates a good investment on your behalf. If you’ve already built a strong foundation, then you have the skills and determination to turn around an agency that isn’t currently profitable.
In your valuation, you might decide that there are too many employees on the payroll, which has severely impacted profitability. Or perhaps the agency is too focused on acquiring short-term or one-off projects, rather than taking on long-term work and developing lasting relationships with clients.
That leads us nicely to our next point. Generally, lower-risk sales are associated with agencies that provide a healthy amount of recurring revenue in the form of retainer agreements or WordPress maintenance plans. This offers a much higher level of income stability.
6. Age and size of agency
As you might have guessed, more established agencies with a strong track record of work are more appealing than newer businesses.
But this isn’t always the case. For example, an individual may have set up the agency and scaled it quickly with the intention of selling it for profit.
Usually, this will be discussed during negotiations with the seller, but you can always verify the information yourself. In the U.S., you can find out when a company opened its doors for business using U.S. Secretaries of State websites. Meanwhile, UK buyers can explore public company records on the government services website.
Besides age, it’s also a good idea to consider the size of the agency. Larger companies can increase confidence in the sale. That said, if you’re looking to grow an existing agency, there are plenty of advantages to acquiring small or mid-sized businesses, particularly if there’s evidence of quality work and impressive results.
7. Intellectual property rights
This isn’t something that all buyers should look for when choosing a WordPress agency. But if you’re looking to significantly maximize your future earnings, you might be interested in acquiring intellectual property (IP) along with the sale.
This refers to any product or service (like software and technology) that’s been developed within the agency. This will usually be legally protected by copyrights, patents, and trademarks, which means that it can’t be used by others without explicit consent.
Gaining exclusive access to such a product can be a huge asset when acquiring a WordPress agency. However, depending on the nature of the IP, it can often be used to drive up the sale price, so you may need to increase your budget.
8. Operational structure
When looking to buy a WordPress agency, you’ll need to consider the existing operational structure. Is it compatible with your current business environment?
Many buyers make the mistake of targeting agencies with a high ROI and a varied client base. But you need to think about how things will work after the acquisition or merger.
Yes, the agency may have been successful where it was, but the processes, technology, team members, and clients may not necessarily translate to your company structure. This is especially relevant if you’re looking to merge your new agency with an existing set of staff and clients.
How will new client accounts be handled and who will be put in charge of them? How often will you manage to meet with clients? Will the team blend as one? These are just some of the questions you’ll want to ask yourself.
9. Brand reputation
We discussed earlier that past projects can inform you about the standard of work. But it’s also important to find out what previous clients have to say about working with the agency.
It’s a good idea to obtain testimonials that speak to the communication, work ethic, and skills of the team. These may be available on the website, but you can also check out Google Business reviews or feedback left on social media.
If you don’t have much luck here, you can always find past clients by looking through the portfolio of work. Then, you can reach out to these individuals/businesses directly to ask the exact questions you’re curious about.
Beyond this, there are various other factors to consider when determining the brand reputation of an agency. For starters, is the agency competitive in organic search results? Does it have a strong social media presence? Does it have a clean website history?
10. Transparent communication
The final factor to consider when buying a WordPress agency is the communication of the seller.
This might not seem like a deal-breaker for you, but poor communication skills or a lack of transparency can slow down the sale and even bring negotiations to a halt. Additionally, if details aren’t exposed until later on in the process, it can change the agreed sale price.
Naturally, prompt replies can make the sale go faster. Therefore, it can be beneficial to choose a seller that keeps to similar working hours or shares the same timezone as you. You should also be assessing the level of openness that the seller operates with.
Have they been upfront about any obstacles or challenges they’ve faced over the years? Have they been transparent about the credibility of financial resources or the right to IP?
Some details may not come to light until there is a legally binding agreement in place, which is completely natural. However, you can still judge for yourself whether the seller will (or is likely to) facilitate a fair and efficient sale.
Where to sell a WordPress agency
If you’re interested in buying a WordPress agency, there may come a time when you want to sell it. You may even be looking to acquire an agency to quickly add value to it and flip it for a profit.
If that’s the case, it’s important to find the right buyer for your company. Freshy is a full-service WordPress agency with a strong track record of successful acquisitions and mergers:
With over 15 years of experience, Freshy has worked with a wide variety of clients across all kinds of industries. It also boasts an extensive range of WordPress services including WordPress development, design, security, search engine optimization, maintenance, and more.
You’ll be on the tail end of a hassle-free process that promises a very smooth transition for your team members and clients. In terms of clients specifically, the in-house support team provides a tailored onboarding process so that customers feel supported and taken care of.
Freshy is open to mergers with agencies of any size and specialism. Plus, you can check out an in-depth portfolio of featured work and case studies to assess the quality of work for yourself. Then, all that’s left to do is fill out a quick form and a member of the leadership team will be in touch shortly.
Conclusion
One of the quickest ways to set up a WordPress agency (or scale up your existing business) is to acquire another company. This is a ready-made solution that might come with a knowledgeable team, an established online presence, and a strong track record of quality work.
To recap, here are ten key factors to consider when buying a WordPress agency:
- Team expertise.
- Previous work.
- Growth potential.
- Current client list.
- Revenue and profits.
- Age and size of agency.
- Intellectual property rights.
- Operational structure.
- Brand reputation.
- Transparent communication.
If you’re looking to sell a WordPress agency, Freshy is an excellent option. We’re interested in agencies of any size and industry. Plus, we carry out a tailored onboarding procedure to help your clients transition smoothly. Fill out this quick form to get started!
Featured image credit: Pexels.
