Buying UK web agency client base... need advice?

[cloudy]

I buy a lot of agency/freelancer portfolios and clientele.

One of the key metrics that you need to understand is intimacy.

To give you an example, if I were approached by ABC Ltd. for a sale with 200 hosting clients who only ever open a support ticket once in a while. I'd lap it up in the first instance, if the price were right.

However, if it were a smaller agency XYZ where the owners were intimate with the client - talking to them on phone frequently, doing smaller fixes for free, not just hosting them but also managing their domain and having designed their website etc. (where the client is clueless and is just trusting XYZ with everything), then the factors change completely.

You have to exercise a certain level of caution if the agency you're getting is like XYZ above. Since a change in the friendly face who speaks to them daily without their knowledge will alarm most of them and they may be in the market looking for a new developer the very next day.

Yes i understand... they are very much like XYZ...
Have you ever bought anything like that before? Have you had it go wrong with the client expecting to much etc?

 

[kickthat]

I would try and see if you could put this back on the seller.

Can you agree a price per client that signs a contract with you, and put the responsibility for arranging the handover onto the seller?

I.e he pitches the move to them, and they sign a contract with you. Then you pay for each successful sign?

 

[Total Noob]

Sounds too good to be true and like you are about to get scammed

(1.1k profit per month on HOSTING, being sold for 7.5k? yeah...)

Unless I misunderstood

 

[cloudy]

Sounds too good to be true and like you are about to get scammed

(1.1k profit per month on HOSTING, being sold for 7.5k? yeah...)

Unless I misunderstood

Nah it’s correctly pal!
Just need to make sure that them clients don’t leave!

 

[cloudy]

I would try and see if you could put this back on the seller.

Can you agree a price per client that signs a contract with you, and put the responsibility for arranging the handover onto the seller?

I.e he pitches the move to them, and they sign a contract with you. Then you pay for each successful sign?

Yes I really like the idea!

The last meeting they had with me... they said... “it’s not our fault if you cannot retain the clients” With your idea of them paying per each successful sign up... I believe I could mitigate that risk. It’s only if they agree to it.


Thank you tho!

 

[Stavro]

The last meeting they had with me... they said... “it’s not our fault if you cannot retain the clients”

My gut feeling is that this is a failing business, their current clients are already wanting to leave, and their £1300/mo numbers are based on old data or otherwise cooked. If things were really going as well as they claim, investors would be jumping at the chance to buy the company at such a huge discount.

 

[SamLewis]

Just out of interest, who is your host?

Right now vps.net. Their user navigation isnt so friendly, the FAQs/help arent well organised, but I think the price and support is ok. I don't really use their website much, as I use cPanel.

 

[darkhorse1]

Friend or not you need to get an agreement from a solicitor signed by both parties. It needs to include a clause stating that company X will no longer offer hosting services to any clients for a minimum term of 3 years, which gives you time to build loyalty and make a switch back too much effort for them.
Just because you are friends with him, means nothing in business or legal terms. Get it drawn up in hard copy .

What if he starts feeling better in 6 months once the hosting stress is gone? and he starts offering hosting to other clients again. Not an ideal scenario at all. It seem a decent price, especially as for 90% of managed hosted companies (in my experience), they cannot be bothered to move hosting due to stress and risk and cost , provided that

1/ the cost stays on parity to what it was
2/ reliability is as good as or better
3/ customer support is great


As mentioned above, if its a close relationship between supplier and hosted clients, I would think closely about it, but if you provide a great service at your end, I see no reason why it couldnt work and it's not a huge amount of money.

 

[cloudy]

Friend or not you need to get an agreement from a solicitor signed by both parties. It needs to include a clause stating that company X will no longer offer hosting services to any clients for a minimum term of 3 years, which gives you time to build loyalty and make a switch back too much effort for them.
Just because you are friends with him, means nothing in business or legal terms. Get it drawn up in hard copy .

What if he starts feeling better in 6 months once the hosting stress is gone? and he starts offering hosting to other clients again. Not an ideal scenario at all. It seem a decent price, especially as for 90% of managed hosted companies (in my experience), they cannot be bothered to move hosting due to stress and risk and cost , provided that

1/ the cost stays on parity to what it was
2/ reliability is as good as or better
3/ customer support is great


As mentioned above, if its a close relationship between supplier and hosted clients, I would think closely about it, but if you provide a great service at your end, I see no reason why it couldnt work and it's not a huge amount of money.

Absolutly! I think what I’m concluding from all the replies is obviously getting a solicitor to look over everything.

That is my biggest worry in all honesty that he could feel better in 6 months and pitch to them hosting and development work.

I’ll get the ball rolling with a solicitor today!