Building a business with value
At Leaders.inc, we work with ambitious agency owners every day, and most want to grow.
But at our recent event, the Value Multiplier, the conversation shifted to something more important:
How do you build a business that is genuinely valuable, not just profitable?
Across the session, attendees enjoyed specialist talks and a panel discussion. One message stood out clearly: high-value agencies are designed differently.
Here are the key themes.
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1. Profit is not the same as Value
Profit keeps a business healthy. Value determines what it is worth to someone else.
Agencies that command the strongest valuations tend to share a few traits: predictable performance, strong systems, clear reporting, and low reliance on the founder. They can operate consistently even when the market tightens or leadership steps back.
A simple test was suggested during the morning session: could your business run well for three months without you? For many owners, the answer highlights exactly where value is being limited.
2. Regulation is a commercial opportunity
With the Renters’ Rights Act approaching, regulation was framed not as a threat but as a filter.
Change increases complexity and compliance. That disadvantages weaker operators, but benefits professional agencies who invest in systems, knowledge and communication.
Landlords increasingly value guidance and certainty. Agencies that lead them through change build trust, improve retention and gain market share while competitors fall away.
3. Portfolio quality beats portfolio size
Several speakers stressed that not all growth improves value.
High-quality portfolios tend to be compliant, low-risk and professionally managed. Poor-quality stock increases workload, regulatory exposure and staff pressure – often reducing valuation multiples rather than increasing them.
In some cases, letting go of unprofitable or high-risk landlords is one of the smartest commercial decisions an agency can make.
4. Management accounts drive credibility
Jo Moran and Laura Cooper focused on the financial foundations buyers look for.
Statutory accounts satisfy compliance. Management accounts run the business.
Agencies that produce timely, accurate monthly reporting – separating recurring income, tracking margins and showing performance trends, inspire far more buyer confidence than those relying on annual snapshots.
Trends matter more than one strong year.
5. Growth comes from a few key levers
In lettings businesses, value is usually driven by two things: the number of managed properties and the average fee per property.
Agencies that understand and actively manage these drivers grow deliberately. Those that don’t often rely on general expansion and hope value follows.
It rarely does.
6. Deal structure matters as much as price
Lucy Noonan and Peter Knight explained that valuations are fluid, shaped by demand, portfolio quality, retention risk and competition.
Deferred consideration is common outside the most competitive markets and, when structured clearly, protects both sides. When structured badly, it damages trust.
Strong Heads of Terms – covering payment structure, exclusivity, handover and guarantees – prevent many deals from failing later.
7. Emotion is expensive in exits
One of the strongest lessons was that emotional decision-making often reduces outcomes.
Owners frequently choose buyers based on how they believe staff will be treated. In reality, staff make their own choices, and loyalty is not transferable.
Most owners only get one opportunity to monetise decades of work.
8. Retention decides acquisition success
From the panel session, one risk dominated all others: retention.
Successful buyers communicate early, protect relationships, avoid sudden changes and focus on people first. Failed acquisitions usually unravel because of uncertainty, not spreadsheets.
9. Final Thoughts
The strongest agencies are not built accidentally.
They are structured to function without constant founder involvement. They treat regulation as leverage. They prioritise quality over volume. They understand their numbers. And they plan years ahead.
Whether your goal is growth, acquisition or exit, the principle is the same:
build for value first – and growth will follow.
