Almost at the 2023 finishing line | The M&A Insider | Issue #7

Global M&A deal value nearly reached a 10-year low in Q3 2023, but market conditions are pointing to a recovery next year.

Many agencies have struggled this year due to budget cuts and project delays, so have not had the performance to go out to market to find a buyer.

Some agencies have still experienced growth, but many have either remained flat or seen profit margins and cash flow significantly eroded.

Raising debt finance has become increasingly more difficult and expensive, so businesses servicing high levels of debt provided off the back of a period of ultra-low interest rates and COVID loans are feeling the pain.

On a positive note, most agency owners are feeling optimistic about 2024 and seeing greater visibility of projects and new business opportunities.

The next general election is looming and could have major implications on policy going forward, notably tax and specifically the raising of capital gains tax. Let's hope whatever government we have next is able to stimulate the economy and encourage business investment.

Industry News

Mergers & Acquisitions

• Stagwell acquires US social/entertainment creative agency, Movers and Shakers

• PMG acquires US media buying agency, Camelot Strategic Marketing and Media

• Stagwell acquires US digital experience agency, Left Field Labs

• Lad Bible Group acquires female-focused digital publisher, Betches Media

• Kin + Carta taken private by Apex Partners

• Flywheel Digital acquired from Ascential by Omnicom

News

• M&A media deals down significantly in the first half of 2023

• AI-volution and deals in the space

• Unbundling AI

• When will UK interest rates go down?

• 10 reasons M&A deals fail

Cactus News

• New on the blog: Building a better Now, Next and Future for your agency

• Four of our Managing Partners took to the stage for the Agencynomics Big Event to share their insight and top basics for scaling an agency in 2023 and beyond

• We've launched a new service offering from 2024 - The Cactus Agency MBA for agencies with a turnover of £1.5M+

• Interested in scaling through acquisition? Join our new mailing list to be first to hear about agencies we're representing (under £500k EBITDA)

• The team just returned from our annual Strategy and Planning Retreat and we have a lot in store for 2024

What’s Happening

1st December - Agency Founders Lunch Leeds (sold out)

Gareth Healey and & Danny Turnbull are returning to Leeds to host an Agency Founder Networking Lunch. Hugely popular, this event has already sold out, but if you'd like to be added to the wait list for a ticket get in touch with our Marketing Manager, Louisa Douglas Kent. 

1st December - Digital Podge

We're proud to partner with Podge Events, Spencer Gallagher, Pete Hoole, Joanne Reid and I will be attending. We're able to recommend a few guests to be considered for the invite list, if you've not been before and would like to come, let me know.

7th December - Roundtable Lunch, Sustainable Agency Growth

Expanding on their talks at the Big Event last month, Joanne Reid and Alfie Wenegieme FCCA are hosting a joint round table lunch for Agency Owners where they will be exploring some of the biggest challenges faced by agency owners when scaling their businesses, book your place here.

Recommendations of the month

Book:

Hidden Potential by Adam Grant

App:

Lollipop

Podcast:

Nudge - marketing research insights

Playlist:

The Zone In