Henry Corona, Author at Agency Management Institute

About Henry Corona

Mr. Corona is focused on the small to mid-cap professional services market for $5 MM to $50 MM firms located in the U.S., South America and Europe. He offers clients realistic assessments of the value of their businesses and the types of transaction structure they are likely to receive and supports each owner and B.O.D. through a successful conclusion. Based on his 30 years of experience in agency finance and operations and merger & acquisition transactions, he assists clients to obtain favorable terms of sale, or to explore and select other options that are in their best long-term interests. Since 1987, FinanceSur has assisted owners of privately-held companies to develop and achieve their financial objectives. This client-oriented approach to investment banking often runs counter to the transaction-oriented approach that focuses only on closing the transaction. FinanceSur will not hesitate to counsel against a transaction if it does not appear in the best interests of the client. In many instances and pending alignment to the our client’s financial and operational objectives, we have verified that occasionally, principals are better served by continuing to manage their own firms rather than sell. FinanceSur assists owners to determine where their greatest advantages rest. An independent analysis helps owners to validate their choice; whether the decision is to sell, or to continue operating their own business. This objective assessment often reveals new opportunities or hidden profits previously overlooked. FinanceSur offers clients over 30 years of significant transactional experience plus direct operating experience. This breadth of experience is applied to every engagement to produce the best long-term results for every client. Mr. Corona holds an MBA in Finance from the University of Southern California, an MA in Economics from UCLA, and a BA in Economics from Grinnell College in Iowa. Mr. Corona has worked as a financial management executive within film companies, advertising agencies, interactive companies and marketing firms throughout the U.S., the U.K., Europe and Latin America. He’s also served in consultancy roles to support public and privately held companies as well government agencies in restructuring operations, and establishing new operating processes and procedures. Mr. Corona developed his financial management expertise at Lucasfilm Ltd. during the first Star Wars’ film series; and refined his skills as a consultant by working in Economics, Finance and Marketing at The Rand Corporation, Pannell Kerr Forster, and the Sanders Consulting Group.

Agency Value In a Digital World – Purchase Price Structures
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Agency Value In a Digital World – Purchase Price Structures

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Agency Value In a Digital World – Purchase Price Structures

When digital was a novel offering, we saw agencies with that narrow focus receive extravagant valuations. Today, digital expertise has become a given rather than a point of differentiation. I heard the comment at an AMI event that basic online digital services are part of the “table stakes” that every agency must put up in order to be seriously considered by a prospective new client, or by a current client for some types of projects. That is consistent with my experience. Most agencies have it in-house and the others outsource it. But it’s a very rare agency today that just doesn’t offer digital services. So, how do advertising agencies charge for services? Agency values continue to be simply defined as a semi-subjective combination of profitability, size, the client list and the services the agency routinely provides. There are plenty of other factors that influence the final number but we always start with these. So, what about the seller’s goals? Many agency owners begin down the path of selling their agency only to quickly retreat once they are shown the valuation and what they can hope to get as a purchase price/package A very important aspect of the transaction is the actual structure of the deal. How, how much, and when are you going to get paid? In many cases, the sales price doesn’t matter as much as when are you going to get paid. First of all, how much cash are you going to receive at closing? What can you expect? And, how negotiable is it? Managing Your Margin Let’s assume that your agency is profitable, with a respectable margin. Say that the net margin is 15%. (Note: net margin is the percentage of revenue [...]

By Henry Corona|