THE HOLMES REPORT - PROVOKE19: FEWER "PREMIUM OPPORTUNITIES" FOR PR AGENCY SELLERS

The final panellist was David Zapata, founder and CEO of Chicago-based Zapwater Communications, a boutique PR firm that has made a couple of micro-transactions—an increasingly prevalent part of the PR industry’s M&A environment.

“It’s all about mitigating risk for us,” he said, pointing out that as a small firm he needs to get every deal right. “The first deal we did—we are Chicago-based agency, and we needed a presence in LA. We asked ourselves, was it more of a risk to hire someone and hope that revenue would catch up—or make an acquisition. And we found an agency where the owner didn’t want to handle the business side any more but she wanted to stay on.

“In the second case, an opportunity presented itself in the Miami market, where the owner wanted an exit strategy. One factor was that both of the agencies we acquired were not strong in influencer and social, where we have good capabilities, and so we have been able to upsell their clients.”