The new breed: Exploring the next agency generation

It is accepted that this is a tough time to launch an agency, but despite a slowdown in the number of new agencies founded (see our Agency by Agency Industry Report, Spring 2025), some 2,710 of the agencies we have mapped were founded since 2022 – 10.7% of all active agencies across the sector. But what type of agencies are they, and which subsectors are growing the most quickly when it comes to agencies being founded?

Mapping the new agency generation

At first glance, when looking at the agencies founded since 2022 we can see similar patterns to the sector as a whole. The subsector with the highest number of new agencies is Website and UX/UI design, with 1,069 agencies born over the past three years. This is the largest subsector we have mapped overall, with 8,327 agencies – 32.96% of all agencies in our mapping.

But there are some differences. Agencies offering Design and branding services make up the third largest subsector when we look at the sector as a whole, but only comes fifth when we look at only the new agencies. Digital and Market research are lower in the table of new agencies founded compared to all agencies, while SEO and Social Media are higher.

Subsector share across all agencies

We can explore this trend in a little more detail when we look at the percentage of all new agencies by subsector when compared to each subsector’s share of the agency sector as a whole.

Here we can see the subsectors that have a higher share of the new agencies compared to their share of the overall agency sector. Notable examples include:

SEO: 20.1% of new agencies compared to 10.4% of all agencies.
Amazon/Marketplace: 1.1% of new agencies compared to 0.6% of all agencies
Digital product design: 13.1% of new agencies compared to 7.7% of all agencies
Conversion: 0.6% of new agencies compared to 0.4% of all agencies
Influencer: 1.6% of new agencies compared to 1.1% of all agencies

The subsectors with a lower share of new agencies compared to their share of the overall agency sector include:

Market research: 1.6% of new agencies compared to 3.1% of all agencies
PR and communications: 5.7% of new agencies compared to 11% of all agencies
Design and branding: 10% of new agencies compared to 19.2% of all agencies
Internal comms and employee engagement: 0.3% of new agencies compared to 0.6% of all agencies
Video and production: 4.9% of new agencies compared to 8.2% of all agencies

Subsectors with the highest proportion of new agencies

When looking at each agency subsector individually, we can also see which specialisms have the highest number of new agencies. Amazon/Marketplace leads the way with 21.2% of all agencies in the subsector founded since 2022, followed by SEO (20.7%), Digital product design (18.2%), Influencer (16.4%) and Behavioural research and behaviour change (16.1%).

Some of this will be influenced by subsectors having a low number of agencies in total, in which case a handful of new agencies could have a big impact. Behavioural research and behaviour change, for example, welcomed 19 new agencies over the past three years. On the other hand, SEO was a subsector with a significant number of agencies already, and yet the 546 agencies offering SEO services that have been founded in the past three years means that one in five are new. 

What does this all mean?

The trends that we see here could be a consequence of two different things. The first may relate to agencies that grew quickly in the 2010s contracting, with experienced staff going on to create their own agencies in digital, SEO, and website development and UX/UI. The second could be an outcome of new market demand for agencies that have capabilities that aren’t yet available to most in-house teams, such as Amazon/Marketplace and, still to some extent, in social.

We can also see that there are a greater number of agencies being founded offering the promise of measurable and efficient marketing than there are offering brand strategy and research. Rightly or wrongly, this is perhaps no surprise given the continuing macroeconomic uncertainty in the UK.

This data raises a number of questions for agency owners, investors and the industry as a whole. Agency owners may be thinking about pivoting or refocusing their existing proposition; investors may be looking at the future M&A pipeline; and industry bodies may want to consider the implications of this for long term talent and skills development within the sector.

What questions would you like answered?

Our data is particularly useful to help agencies identify opportunities and for investors to find specialist agencies, or agencies at specific points in their lifecycle. 

Get in touch if you would like to commission us to do bespoke analysis tailored to your needs and for your exclusive use. You can find out more about our bespoke research and all our products here.  

Would you like to learn more about emerging trends and what is happening across the agency sector? To access all our reports for the next year and our benchmarking Data Shots into 28 agency subsectors (updated quarterly), you can explore our subscription options here.