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For a long time, the story of the independent agency in Australia and New Zealand was simple to tell. These were founder-led businesses that stayed closer to their clients and moved faster because they were free from the pressures of a global holding company. Independence became a synonym for trust, and many agencies earned that reputation through years of building their business without a safety net.
What has changed isn't whether independence matters, but the fact that it is no longer enough to guarantee survival.
There is also a growing realisation that many "independent" agencies aren't as autonomous as their PR suggests. A look behind the curtain often reveals a heavy reliance on managed services partners to execute work or back-end financing provided by the very holding companies they claim to disrupt. This isn't true independence. Its a middle-man model that carries the same bloat and hidden incentives as the larger holding groups. The future belongs to a new breed of agency that is smaller, nimbler and genuinely self-sufficient. These agencies treat technology as their core infrastructure and maintain total financial independence, allowing them to operate with a level of transparency and speed that the older "indie" guard simply cannot match.
Clients today are far more commercially aware than they used to be. Finance and procurement teams now sit right next to marketing during the decision-making process. Technology is no longer a scarce resource and capital is much more cautious about where it lands. While none of these shifts happened overnight, they have combined to move the ground beneath independent agencies in a way that is now impossible to ignore.
We can see this clearly in the way agencies are being bought and sold. According to SI Globals M&A Insights Report 2025 - deal activity remains high in our region, the actual structure of these deals has evolved. Their recent M&A reports show that while buyers still have an appetite for acquisitions, they are becoming much more precise. We are seeing longer earn-outs and stricter conditions, with a focus on proving performance over the long term rather than just paying for current momentum.
This isn’t about buyers being pessimistic. Relationships still matter, but they are no longer enough on their own. Buyers want to know what happens if a founder steps back, how stable the revenue truly is and whether the profit margins hold up once you look past the brand name. An acquisition has stopped being a finish line and has become more of a probation period.
This is where many independent agencies feel a disconnect. Internally, success is often measured by simple revenue growth. To a buyer, those numbers are just the starting point. There is often a mismatch in valuation because of the gap between what a seller expects and how a buyer prices risk.
That gap usually comes down to structure. Buyers are asking practical questions about how a business actually makes its money. They want to know if margins come from repeatable systems or just temporary negotiated advantages. They are looking at whether the model would still work if a major client changed their rules. These aren't hostile questions, but they are the ones you ask when you intend to own something for a long time.
Transparency sits at the heart of this. Clients are now very comfortable asking how media is traded and where an agency’s incentives truly lie. This doesn't mean the agency model is broken, but it does mean that unnecessary complexity is getting harder to justify. The simpler and clearer the explanation, the easier it is to keep a client's trust.
Technology adds another layer to this. There is a lot of talk right now about AI and automated software agents that can plan and buy media. While this promises efficiency, it also creates a massive need for accountability. AI doesn’t remove the need for an explanation; it actually increases it. As trading decisions become more automated, clients want more confidence in who is actually responsible for the results.
Agencies are still agents for their clients. Acting on someone else's behalf means being able to explain in plain language how media is bought and where the risk sits. Automation can improve outcomes but "black-box" systems often make clients more cautious rather than more confident.
This is why we have to be precise about what we mean by technology. Simply having access to a DSP platform is no longer a differentiator because those tools are now available to everyone. Real technology shows up in the way an agency operates every day. It’s found in how work moves through the business and how systems reduce the chance of human error. When technology changes the actual cost of doing business, it matters. When it only exists in a slide deck, it doesn’t.
We are seeing this in M&A trends as well. Buyers are wary of AI being "bolted on" as a sales pitch at the last minute. They are looking for evidence that these capabilities are properly embedded in the business.
Quietly, some independent agencies have already adjusted to this new reality. They are growing more deliberately and spending more time on how the business works than on how it is positioned. Many are separating their advisory, execution, and technology services into clear categories. This separation makes the business easier to run and much easier to value.
From the outside, these agencies might look conservative but from the inside, they are stable and predictable. At Cake.Shop, this is why we have always focused on separation. We keep Cake.Shop as the strategy layer and Sweetshop as the technology layer. This isn’t just about branding; it’s about keeping incentives clear and making the value visible to the client.
Independence still has a bright future in Australia and New Zealand. However, it's no longer defined by what an agency isn't. It is defined by how well it is built and how clearly it can explain itself when the questions get difficult. The agencies that get this right won’t need to talk about it much because their structure will do the talking for them.