Agency owners looking to sell up must have a response to the questions posed by AI, writes Martin Ward of Waypoint Partners.
Selling your agency is all about putting your best foot forward. Until recently, it was clear what a potential investor or buyer was looking for. But with the recent huge advances in AI, the goalposts have changed. According to a private equity house that is active in the marketing services space, if you don’t have an AI strategy as part of your IM (the information memorandum, a core sales document), you’re unlikely to impress.
In effect, you will be broadcasting to the world that you are either behind the times or simply arrogant enough to believe you can ignore the impact of the technology. Both are as bad as each other. An agency that gets it will know that, depending on how they navigate the technology, it represents either the biggest existential threat or the greatest opportunity.
But if the requirement to get on board with the opportunity presented by AI is clear to most, the decision-making journey the leadership team needs to go on is by no means straightforward. And that’s because the business world likes to deal with certainties: if I do A plus B, the result will be C.
We can also blame Richard Herrnstein’s hyperbolic discounting theory, which, simply put, means we humans are much more likely to opt for today’s clear but smaller reward over a future, larger reward that is not yet quite tangible. Effecting behavior change to mitigate climate change is tough for the same reason.
When it comes to embedding generative AI in your organization, whether to make efficiencies or to develop new products and services, you can’t be sure of the endgame until you’re well on the way and