Every few months, an owner tells me the window has closed. Deals are slower, the big buyers have gone quiet, and the best time to sell was a few years ago.
I understand why it feels that way. I just do not think it is true.
The market is not done. It is getting picky. And for owners who prepare, picky buyers are good news.
What the run-up looked like
For most of the last decade, buying agencies and distribution businesses was a volume game. Capital was cheap and plentiful. Buyers had growth targets to hit, and the fastest way to hit them was to add revenue by the book.
So they bought nearly everything. Large agencies and small ones. Clean books and messy ones. Owners who planned to stay and owners who wanted out by Friday. Diligence was fast because speed was the strategy. If a deal had a few problems, the thinking went, the platform would fix them after closing.
That era taught a lot of owners the wrong lesson. It taught them that a book of business sells itself. For a while, it did.
What changed
Two things happened. Money got more expensive, and buyers started living with what they bought.
The first part is simple. When capital costs more, every deal has to earn its place. A buyer who once could afford to be wrong on a few acquisitions now has to be right on most of them.
The second part matters more. After years of fast buying, many acquirers spent time integrating the agencies they already owned. They learned which deals delivered and which ones turned into projects. They saw books that shrank after the founder left. They saw producers who walked. They saw systems that lived in one person's head and nowhere else.
That experience changed how they buy. Not whether they buy. How.
What "more strategic" actually means
I have been involved in more than 25 acquisitions and completed two exits of my own. I have sat on both sides of the table. From the buyer's chair, "more strategic" comes down to one question: will this business still work a year after the owner steps back?
Buyers now look hard at a few things.
They look at retention. A book that holds its clients year after year tells a buyer the relationships belong to the agency, not to one person. Retention is the floor. Growth is what earns attention.
They look at dependence on the owner. If every key client calls the owner's cell phone, the buyer is not buying a business. They are buying a job that comes with a resignation letter attached. To the owner, being the center of everything feels like strength. To a buyer, it is a single point of failure.
They look at systems. Documented processes, a clean agency management system, clear compensation and a team that knows how things run without asking. Boring is safe to buy.
They look at fit. Buyers are no longer adding agencies just to add revenue. They want businesses that fill a gap in their footprint, their product mix or their talent. The same agency can be a priority for one buyer and a pass for another.
And they look at the people. A strong number two, producers who plan to stay and a culture that will survive a change in ownership all reduce risk. Buyers pay for predictability, not potential.
What gets passed over
The flip side is just as clear. The businesses that sit on the market now are usually not bad businesses. They are businesses that are hard to transfer.
An agency where the owner is the top producer, the operations manager and the only person with carrier relationships. A book with strong revenue but no clean data behind it. A business that grew fast but cannot explain why clients leave. An owner who has not decided whether they want to stay, go or something in between.
In the run-up, many of those deals closed anyway. Today, they get a polite pass, or they get an offer with so much structure attached that the owner carries most of the risk.
What to do if you plan to sell in 2 to 5 years
The good news is that two to five years is enough time to become the business buyers want. It is not enough time if you wait until year four to start.
Start by making yourself less necessary. Move client relationships to your team. Introduce your key accounts to the people who will serve them after you. Every relationship that lives only in your head is a discount waiting to happen.
Next, get your house in order. Clean up your data. Write down how the business actually runs. Know your retention, your revenue by carrier and line, and your margins without having to dig for them. When a buyer asks a question, the answer should take minutes, not weeks.
Then decide what you want. Do you want a full exit, a partial sale or a role going forward? Do you want a partner who will grow the business or a clean handoff? Buyers are more strategic now. Owners should be too. The right buyer for you depends on what you want your next chapter to look like, and that is a partnership question, not just a transaction.
Finally, build the business as if you will sell it, even if you are not sure you will. The things that make an agency attractive to a buyer are the same things that make it easier to own. Fewer fires. Better people. More time.
Where the market is heading
I expect the market to keep moving, just with more discipline. Buyers will spend more time on fewer deals. They will pay attention to quality, fit, and the strength of the team. Well-run agencies will keep drawing real interest, and the gap between a business that is ready and one that is not will keep getting wider.
That is not a closed window. It is a higher bar.
The real question is not whether buyers are still buying. They are. The real question is whether your business will be the one they choose.
The run-up rewarded owners who were in the market. The next era will reward owners who were ready.
