How to take control of your agency’s finances

19th April 2024 – by Paul Muggeridge-Breene, Thrive CEO

Do you feel in control of your agency’s finances?

I’m always struck by how many of the founders I speak to answer “no” to this question.

There are dozens of reasons why it’s important to have a firm grip on finances, but they ultimately boil down to one critical thing.


Running an agency is hard. You have to make dozens of decisions every day, and this can be incredibly stressful if you’re not feeling confident about the state of your agency’s finances. Can you afford to invest in a new role or tool? What will your margin be if you give a star team member a pay rise? Do you need to reduce your outgoings to avoid running out of cash?

Having your finances under control means you can confidently make these sorts of decisions with the best information available. Here’s where to start:

1) Create a tracker

You need a simple dashboard that provides an overview of your agency’s performance. Use a spreadsheet with the months of your financial year along the top and categories down the first column – eg revenue, costs of sale, fee income, outgoings, net margin etc. Add the relevant numbers into each month as your year progresses. Be sure to recognise revenue based on the work carried out in each month, not when the invoice is sent or paid.

2) Create a forecast

Being able to explore what the future may look like is one of the best ways to increase your confidence and feel in control. Develop your tracker to include a forecast for future months in your financial year. Numbers should be based on your best estimate – what’s the most likely outcome? You’ll need to use your judgement throughout. Include your weighted pipeline and any entirely new business you expect to win. Don’t forget to include any additional outgoings you’re likely to see, too.

3) Plan scenarios

You can use your forecast tracker to explore different future scenarios, see what impact they would have and develop plans to manage them. For example, what happens if you win a big potential job later in the year? Or lose an existing client? Just adjust the revenue numbers in your tracker to start the process. Don’t forget to increase or decrease your outgoings accordingly, too.

4) Forecast your cashflow

Knowing what your bank balance will look like over the next few months and avoiding cashflow issues are some of the best ways of increasing your confidence. You can use plugins to your finance software (eg Float for Xero) to create a cashflow forecast, or just use a spreadsheet. Be sure to include invoice payments when the money is most likely to land in your bank account. And don’t forget to include all outgoings, including any tax payments due.

You don’t have to do all of this at once – just take it step by step. Each thing you do will help you feel more in control of your finances, and more confident making the decisions that shape the future of your agency.

Paul Muggeridge-Breene is an exited agency founder, former international journalist and a member of the British Psychological Society. Please get in touch if you’d like to discuss how Thrive can help you.