It arrives as an email, or a message from someone you half recognize, or a call from a number you don't. They've been watching your market. They admire what you've built. They'd love to have a conversation about what the future might look like.
And then, sooner than you expected, there is a number.
Something strange happens to that number once you hear it. It stops being one person's opinion and starts feeling like a fact about your life's work. You run the after-tax math in your head. You think about how you'd explain it at dinner. You feel insulted, or you feel tempted, and both reactions come from the same mistake: you are treating the offer as a measurement.
It isn't one. An offer is a bid, and a bid is a statement about the bidder.
An offer prices your situation, not your business
The buyer is not calculating what your agency is worth. They are calculating what they can get it for. Those are two different exercises with two different sets of inputs, and only one of them has much to do with the quality of what you built.
The inputs to the second exercise are things like: whether you have other options, whether you can prove your own earnings, whether the market just gave you a soft quarter, and whether you sound tired on the phone.
Two examples from this industry make the point better than any theory. One founder was running an agency at $4.3 million in annual revenue during a down cycle when a buyer came in and offered one million dollars. Another was offered $4 million for a business doing $4 million in annual turnover, and found himself genuinely weighing it. One offer was refused flat. The other is the kind you sit with.
Look at those two offers next to each other. One is a fraction of a year's revenue, made to a business coming through a rough stretch. The other is a full year of it, made to a steady one. The offers tracked the sellers' circumstances at least as much as the earnings underneath them, and above all they tracked the same input: what the buyer believed the seller would accept.
The first of those two stories is mine.
He said he offered a million dollars to buy Aerial Canvas even though we did 4.3 million in revenue. And I knew we could turn it around with smarter financial decisions, just dialing it in. So it was kind of offensive.
I've had like a 4 million dollar offer, which is exactly the sort of turnover I was turning over last year. And I've gone, should I take this? 4 million is not a bad number. And it's kind of one of those things that you go, should I do it?
Notice what is being weighed there. Not adjusted earnings. Not what the business would be worth in two years with a real salesperson in the seat. A number, against a feeling. That is exactly the position an unsolicited offer is built to put you in, and it works.
The buyer had a number before they had your name
None of this is personal. It's a process, and it runs whether or not you're paying attention to it.
Brad Ziemer at Window Still buys agencies in this industry at around 2.83× earnings, over and over. He runs twelve AI-trained cold callers at four dollars an hour, working through the industry to find owners who are tired or coming off a bad Q1. Full Package Media runs a similar playbook, closing multiple acquisitions a year in the same mid-tier. Zillow's acquisition of VRX told every platform company watching that buying your way into media services works.
By the time an offer reaches you, it has already been through a machine. The buyer knows their multiple and their integration model. They know, roughly, what they will pay for a business your size before they know anything about your business except its size.
Window Still has already acquired LPG.
LPG lifestyle production group, it sold for 1.2x revenue. I think it sold for 1.1 million. And it was doing around 800, 850k with pretty good margins.
Read those numbers with a cold eye. A decade of household-name equity in luxury video, healthy margins, and the brand did show up in the price: on those margins the deal ran a shade above what a systematic buyer's standard predicts. That is what a real brand earns in this market. A premium measured in fractions of a turn, inside a process the buyer has run many times and the seller runs once.
The same asymmetry shows up further up the market. Larger agencies in this industry have paid around 3× for businesses that were potentially worth 5 to 6× with preparation. Nobody was deceived in those deals. The spread is the difference between a seller who arrived with evidence and alternatives and one who arrived with neither.
Why the first number tends to land near half
The advisors and operators around this group put an unprepared seller's outcome at fifty cents on the dollar or less against what the same business could command organized and ready. The working target held inside this network is at least eighty.
That gap does not get closed by being tougher in the meeting. It gets closed by what you carried into the meeting.
What actually creates leverage
Four things, and none of them are negotiating tactics.
Knowing your adjusted EBITDA. Not revenue, and not the bottom line as it appears on your P&L. Adjusted EBITDA is earnings before interest, taxes, depreciation, and amortization, with four add-backs applied: personal expenses run through the business, one-time costs that won't recur, owner compensation normalized to a market rate, and other non-recurring items that distort the picture. Owners who have never been through a sale routinely underestimate this number. Which means a fair share of the offers that feel insulting are insulting relative to a figure the owner has never actually calculated. You cannot defend a number you don't have.
Books that make it provable. An add-back you can document is an add-back. An add-back you merely assert is a discount waiting to happen in diligence. The same dollar of profit is worth more when it is legible.
Alternatives, including not selling. The strongest sentence in any negotiation is that you're genuinely fine either way, and it only works when it's true. An owner with a growth plan and no urgency is a different counterparty than an owner with neither. Buyers can tell the difference in the first ten minutes.
Peers who have seen deals. The first transaction you ever see should not be your own. Operators who have watched other people's deals know which terms matter and what a buyer's smooth answer is actually covering. That knowledge is not available in the abstract. It comes from people who have been in the room.
An offer is information, not a verdict
Reframe what happened. Someone with capital looked at your market and concluded your business is worth owning. That is real information, and it is good news, whatever you think of the number attached to it.
The offer also tells you two other things: which category the buyer has filed you under, and what they believe about your situation. Both are useful. Neither is a valuation.
So the right response to a first offer is a question, then several more. What is that number based on? Is it a multiple of adjusted earnings or of revenue, and which earnings figure are you using? How much of it is paid at close? What is the rest contingent on, and who controls those conditions? A buyer who has done this many times will answer all of that smoothly. Your ability to evaluate the answers is the whole game, and you find out how prepared you are in about four minutes.
Before any of that, you need your own number. Not the one you hope for: an actual one, built from your adjusted earnings and an honest read on the things that push your multiple up or down. You can run the numbers on your own agency in a few minutes.
The first offer is one buyer's opinion, shaped mostly by things that have nothing to do with how good your business is. Change those inputs and the number moves with them, sometimes by more than the business grew in three years of hard work. If you want the longer argument for why this industry is heading toward that conversation whether or not any of us are ready, the full A27M thesis lays it out.