Agency Health Check
Revenue tells you how big you are. These tell you whether you'll still be here in five years. Comp ratio, revenue per employee, overhead, and EBITDA margin, each read against the band the best agencies run in.
A healthy agency by the numbers that matter. Rule of 20 sits at 20.5 on a 23.0% EBITDA margin. Those two numbers predict survival better than revenue ever will.
Revenue tells you how big you are. These tell you whether you'll still be here in five years. The Rule of 20 ties growth and margin together: it's the number Reagan Consulting calls the best single gauge of agency health. Benchmarks are directional comparison points, not your exact peer cohort.
Payroll is in the zone top agencies run. You're paying for production, not for seats.
Strong output per head. This is what lets a small team run like a big one.
Lean overhead. Most of every dollar is going to people and profit, not the building.
Healthy margin. This is the number a buyer pays a multiple on, and the cushion that lets you take a swing.
At or above 20: this agency is creating real shareholder value, roughly a 15%+ annual return. Best Practices agencies hit 25.1 in 2025.
A few numbers, no software, your own figures. Benchmarks are real but directional, pulled from the Reagan/Big “I” Best Practices Study and MarshBerry, not your exact peer cohort. The math is yours to check.