Website Closers® presents an SBA-Qualified Digital Marketing Agency that has grown substantially in the past 6 years and now serves nearly 50 clients, with new ones being onboarded weekly. The agency’s services are applied in two high-growth verticals, local home improvement companies and eCommerce businesses. As their client base has grown, the company is now enjoying very healthy 53.2% net profit margins as clients stay on long-term in monthly contracts.
A very exciting aspect of this business is that they have been able to continue on a growth trajectory with zero ad spend. That is a testament to the word-of-mouth referrals the business receives due to their great work with clients.
The company provides marketing services that include paid search and paid social campaigns, email marketing and SMS texting messaging, and website and landing page designs. The agency also provides a white label Customer Relationship Management system for clients to utilize. These services have attracted a clientele made up of stable businesses earning a minimum of $1 million in annual revenue and larger clients that have profits in the 9-figure range.
eCommerce brands are 65% of the agency’s revenue, and the seller has put together an expert team that includes both full-time employees and 20 contractors who understand what matters to these business owners and how to optimize their brand to generate leads. The agency is known for turning out new creative content for their clients every week at a low cost that still ensures high-quality marketing.
Their team also has deep industry knowledge and expertise that has helped local businesses generate tens of millions of dollars in revenue, which is why clients stay with them for years. The average contract for local clients is $2,877, and for eCommerce companies, it nearly doubles to $5,273. Their average client stays for 20+ months, and the business maintains a very high client retention rate.
Those clients have responded to their work by providing the company with glowing testimonials and referrals to other prospective clients, which has been the agency’s main source of advertising. The company has no paid marketing budget and hasn’t needed one since these referrals have become their primary lead generation source. The agency also has some business partnerships that provide reciprocal referral agreements.
This represents an enormous opportunity for the buyer of this agency, who will benefit from the fact that this business qualifies for SBA lending. With their experienced team in place, there are plenty of clear opportunities for a U.S. Buyer to acquire this company and then scale it quickly. Digital marketing will be one of the strongest tools. The new owner could start running paid media on Google and Facebook and launch a social media marketing campaign to build brand recognition. The agency’s website could be updated with a robust SEO program, particularly since the company just rebuilt the website to better showcase the work they do.
Business Brokers Takeaways
We are excited about this business for 3 important reasons:
1. SBA & Seller Financing. The business made a notable achievement recently when it underwent a successful Quality of Earnings (QoE) report from a third-party accounting firm, which provided independent verification of the company’s financial statements.The SBA approval this agency has is also a major benefit for the buyer since SBA loans are a popular way to acquire a profitable online business. An SBA loan enables investors to finance the sale with just 10% of the asking price put down up front, and the loan can be financed over 10 years at very attractive interest rates. The agency has passed the underwriting process of an SBA lender, which approved $5.3 million in debt financing. The seller has made this even more attractive by offering to provide up to $1.25 million in seller financing.
2. Professional Team in Place. Client accounts are skillfully managed by an experienced team that includes two email strategists and a paid social account manager. Those full-time employees are assisted by 20 contractors, mostly based in Latin America and the Philippines, and they include designers, a web developer, a content strategist, a virtual assistant, and a creative assistant. This is a 100% remote business that can be operated anywhere, and this team is fully versed in both verticals the agency services and understands how to build brand recognition and drive leads. The business is organized in pods, which include a local services marketing pod and four eCommerce marketing pods. The agency also benefits from certifications and partnerships with Google Premium, Meta Business, Klaviyo Gold, Shopify, and Triple Whale Gold.
3. Strong Sales Management. The agency tends to see new business increase on the eCommerce vertical during Q1, particularly from new clients leaving agencies that underperformed for them during Q4. After the company gets a referral, an interview is scheduled, and the agency completes an audit of the desired channels that would be managed. Onboarding information is sent to those clients who are ready to sign up. The company is averaging 2-4 new leads each month and maintains a very high close rate, which has been accomplished without either a digital marketing plan or a sales team. Establishing both would be a major game changer for the new owner.
Conclusion
Launched in 2019, the business now benefits from an expanding client base of professional businesses operating in local services and eCommerce, two rapidly growing verticals, and they maintain ownership of numerous domains created for home improvement clients, who are 35% of the agency’s revenue and represent an under penetrated niche from the perspective of a marketing firm.
Today, most clients are in a month-to-month service agreement.
The ideal buyer for this company would be someone with digital marketing experience who could guide this business toward untapped growth potential. There are possibilities to grow the business by expanding service to its existing verticals while also expanding into new industries. With the demand for expert digital marketing continuing to grow rapidly, this agency has enormous potential moving forward.
