When I see an agency listing that mentions CMO services or consulting, I skip it.
I don't even look at the numbers because I know what that listing is really saying.
The founder is the business. Customers are paying for the founder's time and advice.
Buy that and you're not buying a business. You're buying a job.
I've sold four companies. Since 2024 I've been buying and growing web and digital agencies, and I've looked at hundreds more along the way.
Founder dependency (buyers call it key person risk) comes up in almost every conversation. It's one of the biggest fears founders have when they think about selling.
So here's how I look at it as a buyer, and what you can do about it. It's one part of the bigger picture in my guide to selling your business.
Depending on you vs requiring you
There's a difference between customers depending on you and the business depending on you.
Every agency has customers who depend on the founder. That's very normal.
Your strategic customers especially. They're making decisions with real money on the line every month, so they want to know who's flying the plane.
(I break down transactional and strategic customers in what happens to your customers when you sell.)
The problem starts when the business itself requires you. When you're the one doing the work, and nobody else can.
Your customers can depend on you. Your business can't.
The hub and the spokes
When you start, it's just a hub on the wheel. It's all you.
Then you build your first spoke in customer support. Someone else answers the tickets, so you can do more sales.
Then your second spoke in admin. Invoices, contracts, paperwork. Again, so you can do more sales.
Then you hire a salesperson. Now you're not just selling. You're working the machine.
Each spoke frees up the hub to build the next one.
If you've raised capital, you can often launch with the hub and spokes in place, with co-founders covering the key roles from day one. If you're bootstrapping, it can take months to years.
The hub isn't the boss
Being the hub doesn't mean sitting back while everyone else does the work.
You need to be able to work at every level, from the clouds of the numbers down to the dust of the details.
In my experience, once you're at 40 or 50 people, you're out of the day-to-day detail most of the time. Your job comes down to setting the direction, supporting the team, and making sure there's cash to fund it all.
The sooner you get there, the better. But it's not always up to you. Markets change, businesses evolve and competitors compete.
When I was the hub
When I sold my first company, there was one part of the business I never escaped.
This was before AI. I'd built a handful of integrations myself, and only I knew how they worked.
So when an integration broke, it came back to me, and when we sold, I was worried.
It got resolved over time, but it took a while.
Some knowledge is just hard to transfer. And the longer only you hold it, the harder it gets.
A buyer isn't asking whether you matter. They're asking whether the spokes can run the business day to day, with you supporting rather than doing.
What buyers actually discount
What gets marked down is extreme dependency.
Consulting. Fractional CMO roles. Anything where the founder personally delivers the work and the customer is buying their time.
That revenue walks out the door with you.
Here's what that looked like in one deal.
The seller offered a CMO-level consulting service to a few customers. It was less than 10% of the deal value.
The friction point was the deal structure. It had that consulting revenue paid at the same multiple as everything else. It didn't make sense. The founder was the service. We couldn't pay a multiple on revenue that relied on him being involved.
So we split it. The seller kept the consulting customers. We took the repeatable, productised ones.
It worked for both sides. The seller kept some future income. We got a much cleaner path into the business, and the numbers got a lot cleaner too.
Buyers pay a multiple for revenue that repeats. Consulting revenue only repeats as long as you do.
Splitting customers is one option. Otherwise a buyer prices the dependency in, asks you to stay longer (often through an earn-out), or walks away.
Changing pilots
The good news is most of what happens in an agency isn't consulting. Most of it can be documented.
Remember those strategic customers who want to know who's flying the plane? Right now, the answer is probably you.
But planes get flown by other pilots all the time. That's what training, checklists and manuals are for.
A business works the same way. With strong playbooks and SOPs in place, it's a lot easier to change pilots, or put a new one in the seat.
Without them, everything lives in your head. And your head doesn't transfer in a sale.
Before you sell
Move your strategic customers onto the team. Start making them less dependent on you, and connect each relationship primarily to the people who'll look after them.
Run the month-away test. If you stepped out for a month, what would stop? Every answer is a spoke to build and a process to write down. Playbooks and SOPs for delivery, onboarding, support and anything only you know how to fix, enough that a new pilot could take the controls.
Be upfront about consulting revenue. If part of your revenue is you, personally, say so early. A buyer will find it in due diligence anyway. Agree how it's handled up front, whether that's a different multiple, a longer handover or keeping those customers yourself.
A business that leans on you can be sold. A business that requires you is a job.