London Ad Agency: The Startup's Ultimate Vetting Guide

Stop looking for the 'best' paid ad agency in London. Seriously. You're asking the wrong question and it's probably why you're struggling to find one. The question isn't "who is the best?", but "who is the right fit to solve my specific problem, right now?". Most agencies, especially in a city like London, are not the right fit for a startup. They are built for a different game entirely, and if you're not careful, they will happily burn your hard-earned cash on their learning curve.

As a startup founder, your reality is about cash flow, runway, and getting a return on every single pound you spend. You need leads, trials, sales. Not fluffy 'brand awareness' metrics that look good in a report but don't keep the lights on. This guide is going to walk you through how to think like an expert when hiring an agency, so you can avoid the common pitfalls and find a partner that actually understands how to drive growth for a new business.

Why will most London agencies burn my startup's cash?

Let's be brutally honest about the agency landscape in London. It's saturated. You've got massive network agencies in the West End with swanky offices, used to servicing huge corporates with six-figure monthly ad spends. They have layers of account managers, strategists, and junior staff. When a startup with a modest budget of, say, £2k-£5k a month comes along, you're often not getting the A-team. You're getting the junior exec who's learning the ropes on your dime.

These big agencies think in terms of long-term brand building. They’ll talk to you about 'share of voice' and 'ad recall lift'. That's all well and good for a company like Unilever, but for you, it's poison. You need to see a direct line between ad spend and revenue, and you need to see it fast. Their entire structure and mindset is misaligned with the urgency and agility a startup requires.

Then you have the small, boutique agencies. Some are brilliant, but many are just one or two people who've left a bigger agency and decided to go it alone. The danger here is that they often lack broad experience. They might be a whizz at Google Ads for eCommerce, but if your B2B SaaS needs a complex LinkedIn strategy, they're out of their depth. They say yes to the work because they need the revenue, not because they are genuinely the best person to solve your problem.

The biggest red flag of all? Any agency that promises you a specific return on investment (ROAS) or a set number of leads before they've even touched your account. It's impossible. Anyone who does this is either lying or naive. Paid advertising is about testing, learning, and optimising. There are no guarantees. A good partner will be upfront about the risks and the process, not sell you a fantasy.

So, how do I actually vet an agency properly?

You need to become a forensic investigator. Forget their slick website, their awards, or their office location. None of that matters. Your entire focus should be on one thing: relevant proof. This means digging into their case studies with a critical eye.

Don't just scan for logos you recognise or big revenue numbers. That's surface-level stuff. You need to deconstruct what they actually did. For instance, a case study showcasing significant revenue and ROAS for a prize draw company, while impressive, might be irrelevant if your goal is to acquire sign-ups for a software product. You need to look for evidence that they have solved a problem like yours before.

Here’s how to do it. When you look at a case study, you're looking for the story, the context. What was the situation before the agency got involved? What was the specific challenge?

For instance, I remember a medical job matching SaaS client we worked with. They were acquiring new users, but their cost per acquisition (CPA) was nearly £100, which was completely unsustainable. They were burning through their funding. The problem wasn't 'we need more ads'; the problem was 'our acquisition is fundamentally broken'. We managed to restructure their entire approach on Meta and Google Ads and brought that CPA down to just £7. That's a 10x improvement. The case study isn't just a vanity metric; it's a story about solving a specific, critical business problem. That's the kind of depth you should be looking for.

Here's a framework you can use to analyse any case study you see:

If an agency doesn't have public case studies, or the ones they have are vague and lack detail, that's a huge warning sign. It suggests they either don't have the results to show, or they don't understand the importance of proving their value. A confident, expert agency is proud of their work and has the data to back it up.

What questions should I ask on that first call?

Right, so you've done your homework, found an agency with some promising case studies, and you've booked an initial chat. This is not a sales call for them to pitch you. This is a reverse interview. You are assessing them. Your goal is to get past the sales patter and see how they actually think.

Don't ask generic, lazy questions like "What's your process?" or "What results can you get me?". You'll get a pre-rehearsed, generic answer. You need to ask questions that force them to think on their feet and demonstrate genuine expertise.

Here are some much better questions to ask:

• -> "Looking at my website and business for 5 minutes, what do you see as the single biggest risk or challenge to us getting a good return on ad spend?"
  This question immediately puts them on the spot. A good consultant will be able to give you an instant, candid assessment. They might say your offer is unclear, your landing page is weak, or your pricing is confusing. A bad salesperson will just say "Oh, it looks great, we can definitely get you results!". One shows expertise, the other shows desperation for a sale.


• -> "Talk me through a time a campaign for a client like me *didn't* work initially. What was the problem, and what did you do to turn it around?"
  This is my personal favourite. It tests for honesty and problem-solving ability. Every single agency has campaigns that fail at first. It's part of the process. If they claim they've never had a campaign fail, they're lying. What you want to hear is a story of diagnosis, hypothesis, testing, and iteration. It shows you their thought process under pressure.


• -> "Who exactly would be working on my account? Will I be speaking to the person actually managing the campaigns?"
  In many agencies, you get sold by the senior, experienced director, and then your account is handed off to a junior who you never speak to. You need to clarify this. For a startup, you want direct access to the expert, not an account manager acting as a go-between.

A great way to test an agency is to see how much value they'll provide for free. We, for example, offer a free, no-obligation account review or strategy session. In that call, we'll dig into your business, look at your existing setup (if you have one), and give you actionable advice you can go and implement yourself that very day. We do this because it's the fastest way for both parties to figure out if there's a good fit. It demonstrates our expertise in a tangible way. If an agency is cagey about giving you any real advice before you've signed a contract, they're more interested in your money than your success.

What if the ads aren't the real problem?

Now for the bit of tough love. After all this vetting, there's a strong possibility that the reason you're struggling to get results from ads isn't because you haven't found the right agency yet. It's because your offer is broken.

I've seen it countless times. A founder comes to us with a fantastic product, but their go-to-market is all wrong. A brilliant ad campaign pointing to a confusing, high-friction offer is like owning a Formula 1 car but putting bicycle wheels on it. It looks the part, but it goes nowhere, expensively.

The most common failure point in all of B2B advertising is the "Request a Demo" button. Think about it. You're asking a busy, important person to commit their valuable time to sit through a sales pitch, from a company they've never heard of, for a product they don't yet understand. It's an incredibly arrogant ask. It screams "I want to sell to you," not "I want to help you."

A good agency doesn't just run ads. They should be a strategic partner who challenges you on this. They should be asking tough questions about your landing page, your value proposition, and your call to action. Their job isn't to drive traffic; it's to drive conversions. And if the conversion point is the problem, they need to tell you.

Your offer's only job is to provide a moment of value. An "aha!" moment that makes the prospect think, "Wow, this is actually useful."

One B2B software client we worked with was struggling to get leads. Their offer was a standard demo request. We convinced them to change it. Instead of a demo, they offered a free tool that analysed a prospect's data and gave them one valuable insight. Their lead volume tripled almost overnight, and the quality was higher because the prospects had already experienced the value of the product firsthand. Fix your offer first. No amount of ad spend can fix a bad one.

But how do I know what I can afford to spend?

This is the final piece of the puzzle you must have in place before you even think about hiring an agency. You need to know your numbers. Specifically, you need to know your Customer Lifetime Value (LTV). Without this, you're flying blind. You have no idea if paying £50 for a lead is a bargain or a catastrophe.

The real question isn't "How low can my Cost Per Lead go?" but "How high a CPL can I afford to acquire a great customer?". The LTV tells you the answer. Here's how to do a basic calculation:

1. Average Revenue Per Account (ARPA): What does a typical customer pay you each month? Let's say it's £400.
2. Gross Margin %: What's your profit margin on that revenue? (Revenue - Cost of Goods Sold). Let's say it's 75%.
3. Monthly Churn Rate: What percentage of customers do you lose each month? This is crucial. Let's say it's 5%.

Now, the simple maths:

LTV = (ARPA * Gross Margin %) / Monthly Churn Rate

So, in our example:
LTV = (£400 * 0.75) / 0.05
LTV = £300 / 0.05
LTV = £6,000

This means that over their entire time as a customer, each new client is worth £6,000 in gross margin to your business. This number changes everything. A common rule of thumb is to aim for an LTV to Customer Acquisition Cost (CAC) ratio of at least 3:1. This means for a £6,000 LTV, you can afford to spend up to £2,000 to acquire that customer.

Now let's work backwards. If your sales team (or you!) can convert 1 in 10 qualified leads into a paying customer, you can afford to pay up to £200 per qualified lead (£2,000 / 10). Suddenly, that £80 lead from a LinkedIn campaign doesn't look so expensive, does it? It looks like a profitable investment.

Knowing this number empowers you. When an agency comes to you with results, you can judge them properly. If they're delivering leads at £150 but they're high quality and converting, you know it's working. If they're delivering leads at £20 but none of them ever close, you know something is wrong. Without knowing your LTV, it's all just guesswork.

This is the main advice I have for you:

Hiring a paid ads agency in London is a major decision for a startup, and getting it wrong can be incredibly costly. You have to go into the process armed with the right framework and the right questions. Stop looking for a magic bullet and start looking for a genuine strategic partner. To cut through the noise, you need a clear plan of action.

I've detailed my main recomendations for you below in a step-by-step process. Follow this before you sign any contracts.

Doing this groundwork yourself is a massive advantage. It forces you to understand your own business better and puts you in a position of power when you talk to agencies. But executing it, especially in a market as competitive and expensive as London, is another beast entirely. It requires deep platform knowledge, constant testing, and strategic oversight.

Getting it right can be the difference between stagnating and finding a scalable, repeatable engine for growth. If you've done the work above and want to discuss how to turn that strategy into a high-performing ad campaign, it might be time to speak with an expert.

That's where a professional consultancy can make a huge difference. With years of experience and a deep understanding of the advertising landscape, we can help you identify the best strategies to drive growth. We can provide insights that you might not have thought of and take over implementation of the entire optimisation process for you, ensuring that every pound you spend is working to grow your business. We offer a no-strings-attached, completely free strategy session where we can audit your current approach and give you a clear plan. It's a chance for you to get some expert advice and for us both to see if we're a good fit to help you scale.

Hope that helps!