When your agency is closing in on a $1 million revenue milestone, it’s not always clear whether to keep pushing alone or bring in a partner to support your next leap forward. For one agency owner in Toledo, Ohio, the choice became clearer with each passing month of juggling growth, acquisitions, and operational overwhelm.
After more than a decade of building a personal lines powerhouse, this agency owner had done just about everything right: smart acquisitions, steady expansion, and building a recognizable brand in a competitive local market. But the weight of HR, accounting, and constant policy servicing started to take a toll and the ceiling on further growth was starting to show.
A Strong Foundation Built on Personal Lines and Smart Acquisitions
Based in Toledo, Ohio, the agency manages approximately $7 million in premium, with a heavy emphasis about 95% on personal lines. The business is poised to surpass $1 million in annual revenue by 2025.
This growth was fueled in part by two key acquisitions:
- The first, about eight years ago, was a progressive-heavy auto book targeting the underserved Hispanic market. That book, as the agency owner described, “has just grown like wildfire.”
- The second acquisition, five years ago, brought access to one of Insurance Company and a loyal client base. However, it also came with high-touch service expectations that now strain the team’s capacity.
While both deals were pivotal, they also highlighted a core challenge: every new client, every policy renewal, every “Why did my rate go up?” call lands back on the same small team.
Why the Owner Explored Partnership
With a lean team and rising demands, the owner began considering options that could relieve the back-office pressure while preserving the agency’s momentum.
"I’ve got good producers and great retention," the owner explained, "but we’re not set up to scale the way I’d like. The day-to-day stuff HR, payroll, accounting it’s nonstop. And I still want to do more."
He’s not alone. Many agency owners at this growth stage find themselves caught between wanting to expand and being stretched thin operationally.
What triggered the outreach to Equity Expansion was a desire to:
- Offload HR and financial administration
- Gain support for future acquisitions
- Explore a phased exit within the next few years
The owner wasn’t looking to walk away. He was looking for a strategic partner who could add lift without forcing cultural or brand compromises.
How Equity Expansion Structured the Partnership
After an initial discovery call, Equity Expansion presented a financial modeling structure that aligned with the agency’s revenue trajectory and succession goals.
Here’s what the proposed partnership looked like:
- Estimated Transaction Size: $3 million–$4 million based on projected $1M revenue
- Structure: Mix of upfront cash, equity rollover, and performance-based earnouts
- Equity Rollover: 15%–25% into the buyer’s larger platform, allowing for upside as the agency grows
- Operational Support:
- Full HR and payroll services
- Bookkeeping and financial reporting
- Access to national carriers and better commission splits
- Marketing and digital support to further build the local brand
Importantly, the owner retains day-to-day leadership through the next transition phase while reducing administrative burden and positioning the agency for long-term value creation.
Cultural Fit Was the Deciding Factor
The owner emphasized that any partnership would have to align culturally. “My producers are loyal, my staff’s been with me for years. I’m not interested in flipping the business, I want to grow it, and eventually exit in a way that feels right.”
Equity Expansion’s ability to tailor partnerships not just plug agencies into a one-size-fits-all structure was a key differentiator. The recommended buyer had a Midwest footprint, a strong back-office platform, and a track record of keeping brands intact.
That gave the owner confidence that a future partnership wouldn’t just be a transaction it would be a relationship.
Post-Partnership Benefits and Outlook
While the agency is still in early discussions, the partnership modeling exercise has already given the owner clarity and options. If the deal proceeds as envisioned, the benefits will include:
- Less Time on Admin: HR, payroll, and accounting shifted off the owner’s plate
- Increased Scalability: Freed-up capacity for recruiting and local growth
- Financial Liquidity: Significant cash out with retained equity for future upside
- Phased Exit Path: Owner can reduce involvement by Q1 of next year if desired
For the owner, it’s not about leaving it’s about leveling up. And with the right support, what started as a $7 million book could double in value over the next five years.
Ready to Scale Your Agency Without Doing It Alone?
Whether you’re looking to grow, exit, or just lighten the load, Equity Expansion offers tailored partnership solutions for agencies like yours. Our team works exclusively with insurance agency owners between $500K–$2M in annual revenue to unlock growth, protect legacy, and build value.
Schedule a confidential consultation today to see if a partnership is right for your agency.
