The US Founder's Guide to Vetting and Hiring Paid Ad Agencies

I've seen hundreds of US founders make the same costly mistake. They spend weeks searching for a "paid ads agency in Austin" or the "best Google Ads expert in San Francisco," believing proximity equals quality. It's a fundamental misunderstanding of what actually drives results in paid advertising. The truth is, the best agency for your B2B SaaS company in California might be a small, specialised team right here in the UK. Why? Because we understand SaaS. A local generalist who ran ads for a dentist last week understands nothing about your business.

This guide is designed to stop you from burning tens of thousands of dollars learning that lesson the hard way. We're going to walk through the exact framework you should use to vet and hire an agency, a framework built on maths and strategy, not geography. It all starts with looking inward at your own business, because no agency, no matter how good, can fix a broken foundation.

So, Why Is Hiring a Local US Agency Often a Terrible Idea?

Let's be brutally honest. When you type "PPC agency near me" into Google, you're not getting a list of the world's best experts. You're getting a list of the companies best at local SEO. The skills required to rank a Google Business Profile are entirely different from the skills required to profitably scale a multi-channel ad campaign for a complex B2B product.

The core issue is a lack of specialised expertise. A generalist agency in your city might have a portfolio that includes a local restaurant, a law firm, and a car dealership. They might be perfectly competent at running local search campaigns for those businesses. But do they understand the nuances of a 6-month B2B sales cycle? Do they know how to calculate LTV for a subscription product? Do they have experience with the specific targeting options on LinkedIn that will reach VPs of Engineering at Series B tech companies? Probably not.

I remember auditing an account for a US-based software company. They were working with a big, well-regarded agency in their city. The agency was spending a fortune on broad awareness campaigns on Facebook, getting lots of clicks and impressions, and patting themselves on the back. But the leads were rubbish. We looked at their targeting and they were essentially aiming at anyone with "technology" as an interest. It was a complete waste of money. We switched their budget to highly-targeted LinkedIn campaigns aimed at specific job titles and industries, combined with Google Search ads for high-intent keywords. Their lead quality shot up overnight, and their cost per qualified lead dropped by over 70%.

You need a partner who lives and breathes your industry. Someone who has already solved the exact problems you're facing for dozens of other companies just like yours. Whether that partner is in San Antonio or Scotland is completely irrelevant. In today's world, with tools like Slack and Zoom, physical location is the least important factor in choosing a partner. In fact, by limiting your search to your own city, you are actively choosing from a smaller, and likely less qualified, pool of talent. You need to find a specialist, and the best way to do that is to look for proof of their expertise, not their postcode. In fact, many founders get overwhelmed when choosing a local ad agency because they all seem to make the same promises without having the specialised experience to back it up.

Before You Write a Single Cheque: Your Pre-Flight Checklist

Here’s a truth most agencies won't tell you: your success with paid ads is about 80% determined before you even launch a campaign. It's determined by your offer, your understanding of your customer, and your business's underlying economics. An agency can't fix a broken model; we can only amplify what's already there. If you amplify a weak offer, you just get a lot of expensive, unqualified clicks.

So, before you even start looking for an agency, you need to do your homework. Get this right, and you're setting any future partner up for success. Get it wrong, and you're setting them up to fail, and you'll be the one paying for it.

Step 1: Define Your Ideal Customer by Their Nightmare, Not Their Demographics

Throw away that useless "buyer persona" document that says your customer is "Sarah, a 35-year-old marketing manager who enjoys yoga and hiking." It's meaningless. It tells you nothing about why she would ever buy your product.

Instead, you need to define your Ideal Customer Profile (ICP) based on their pain. Their specific, urgent, expensive, career-threatening nightmare. Your product or service is the aspirin for that headache.

-> For a cybersecurity SaaS, the ICP isn't "companies with 100-500 employees." It's the CTO who lies awake at 3 AM terrified of a ransomware attack that could bankrupt the company and ruin his reputation.

-> For a fractional CFO service, the ICP isn't "startups that just raised a Series A." It's the founder who is brilliant at product but breaks into a cold sweat every time an investor asks for a cash flow projection because he's basically guessing.

-> For one of our clients, a medical job matching platform, the nightmare wasn't 'finding a job'. It was the immense stress and time wasted by doctors sifting through hundreds of irrelevant listings on generic job boards. Their pain was inefficiency and frustration. Addressing this specific pain point directly in our strategy was key, and for that client, we ultimately reduced their Cost Per User Acquisition from a staggering £100 down to just £7.

Once you've identified this nightmare, you can figure out where these people congregate online. What podcasts do they listen to (e.g., 'Acquired', 'My First Million')? What newsletters do they actually read (e.g., 'Stratechery', 'The Hustle')? What software do they already use (e.g., Salesforce, HubSpot)? Who do they follow on LinkedIn or Twitter? This is the foundation of effective ad targeting. Without this deep understanding, you're just throwing spaghetti at the wall and hoping something sticks.

Step 2: Do the Maths. Calculate Your LTV (or You're Flying Blind)

This is the most important, non-negotiable step. If you don't know what a customer is worth to you over their lifetime, you have no possible way of knowing what you can afford to spend to acquire them. You'll be making decisions based on gut feelings and vanity metrics like Cost Per Click, which is a recipe for disaster.

The real question isn't "How low can my Cost Per Lead go?" but "How high a CPL can I afford to acquire a fantastic customer?" The answer is your Lifetime Value (LTV).

Here's the simple formula for a subscription business:

LTV = (Average Revenue Per Account [ARPA] * Gross Margin %) / Monthly Churn Rate %

Let's break it down:

• ARPA: What's the average amount a customer pays you each month? Let's say it's $500.
• Gross Margin %: What's your profit on that revenue after accounting for costs of goods sold (COGS)? For SaaS, this is often high, let's say 85%.
• Monthly Churn Rate %: What percentage of your customers cancel their subscription each month? Let's say it's 3%.

So, your LTV would be:

LTV = ($500 * 0.85) / 0.03

LTV = $425 / 0.03 = $14,166

This single customer is worth over $14,000 in gross margin to your business. Now we can talk about your Customer Acquisition Cost (CAC). A healthy LTV:CAC ratio is typically at least 3:1. This means you can afford to spend up to $4,722 ($14,166 / 3) to acquire a single new customer and still have a very profitable model.

This simple calculation changes everything. Suddenly, a $300 lead from LinkedIn doesn't seem so expensive if you know your sales team can close 1 in 10 of those leads into a customer. That's a CAC of $3,000, well within your profitable range. Without knowing your LTV, you'd panic at the $300 CPL and turn the campaign off, killing your most profitable channel. Many founders find it difficult to scale their ad campaigns precisely because they haven't done this foundational maths.

To make this easier, I've built an interactive calculator for you. Play around with the numbers to see how small changes in churn or ARPA can dramatically impact what you can afford to spend on ads.

Step 3: Fix Your Offer. Delete the "Request a Demo" Button.

Now we get to the most common point of failure in B2B advertising. You've nailed your targeting, your ad copy is perfect, the prospect clicks... and they land on a page with a single, arrogant call to action: "Request a Demo."

This is a terrible offer. It's high-friction and low-value for the prospect. You're asking a busy decision-maker to commit to a 30-minute meeting just to be sold to. It instantly positions you as a commodity. They have no idea if your solution is any good yet, so why would they give you their time? It's no wonder your conversion rates are in the toilet.

Your offer's only job is to provide a moment of undeniable value. An "aha!" moment that makes the prospect sell themselves on your solution. You must solve a small, real problem for them for free to earn the right to solve the bigger problem for a price.

Here are some much better offers:

• For SaaS Founders: A free trial (no credit card) or a freemium plan is the gold standard. Let them use the actual product. Let them experience the value first-hand. This generates Product Qualified Leads (PQLs) who are already half-sold. We've worked on campaigns for SaaS clients where simply switching from a "demo" to a "free trial" offer doubled their conversion rate. One client generated 1535 B2B SaaS trials by focusing on a frictionless trial offer.
• For Service Businesses: Bottle your expertise into a tool or asset. An SEO agency could offer a free, automated website audit that uncovers the top 3 keyword opportunities. A corporate training company could offer a free 15-minute interactive video module. For us, it's a free 20-minute strategy session where we audit failing ad accounts.
• For High-Ticket Products: Offer a valuable piece of content that helps them make a better buying decision. A detailed buyer's guide, an ROI calculator, or a case study of a similar company that saw massive success.

The principle is the same across the board: give, give, give before you ask. Provide value upfront, build trust, and demonstrate your expertise. The sale will follow.

The Vetting Framework: How to Find a True Partner

Alright, you've done your homework. You know your customer's nightmare, you know your LTV, and you have a high-value offer. Now, and only now, are you ready to start talking to agencies. This framework will help you cut through the noise and find a team that can actually deliver results.

Part 1: The Case Study Deep Dive

This is where the vetting process truly begins. Any agency can claim to be an expert. The proof is in their past work. But you can't just glance at the logos on their website. You need to dissect their case studies like a detective.

Here's what to look for:

-> Niche Relevance: Have they worked with companies like yours before? Not just in the same broad category ("B2B"), but in your specific niche ("B2B SaaS for finance teams," "High-ticket e-commerce for industrial parts"). The more specific, the better. If they show you a case study for a local pizza place, it's irrelevant to your software company.

-> Real Metrics, Not Vanity Metrics: Clicks, impressions, and reach mean nothing. You're looking for business metrics. ROAS (Return on Ad Spend), CPA (Cost Per Acquisition), CPL (Cost Per Lead), and an increase in qualified pipeline or revenue. If their case study says "We generated 10 million views," ask "So what? How much revenue did that drive?" For example, we're proud of a campaign that generated £107k in revenue for a client at 618% ROAS. That's a real business result.

-> The "How" and the "Why": A good case study doesn't just show the results; it explains the strategy behind them. What targeting did they use? What was the offer? What creative angles did they test? What did they learn? It should tell a story of a problem, a hypothesis, a test, and a result. This shows they have a repeatable process, not just dumb luck.

-> Don't be afraid to ask for specifics. "I see you got a $22 CPL for a B2B software client. Can you tell me more about their ICP and the offer you used? What was the quality of those leads?" A true expert will be happy to discuss the details. A pretender will get defensive or vague.

Part 2: The Initial Call - Questions They Won't Expect

Once you've shortlisted a few agencies based on their case studies, it's time for the initial consultation. This isn't a sales call for them; it's an interview. You are in control. Your goal is to move beyond their polished sales pitch and test the depth of their strategic thinking.

Here are some questions to ask:

1. "Based on what you know about my business, what would be your initial hypothesis for a winning campaign? What audiences and angles would you test first?" A good consultant will have already thought about this. They'll have ideas based on your ICP and offer. A bad one will say, "We'll have to do some research after you sign the contract."
2. "Walk me through a campaign you ran that failed. What was the hypothesis, why did it fail, and what did you learn from it?" This is my favourite. It tests their honesty and their ability to learn. Everyone has campaigns that fail. The experts analyse them, learn, and apply those learnings to future campaigns. Pretenders will blame the algorithm, the client, or the phase of the moon.
3. "What's your process for creative testing and iteration?" You're looking for a structured answer. "We test 3-5 different ad creatives with different hooks and images against our top 2 audiences. After 7 days, we analyse the data, kill the losers, and iterate on the winners." A vague answer like "We make great ads" is a huge red flag.
4. "How do you approach the relationship between ad spend, CPL, and lead quality?" This tests if they think like a business owner or just a media buyer. They should understand that sometimes a higher CPL is acceptable if it leads to a much higher lead-to-sale conversion rate and a better CAC. They should be talking your language: LTV, CAC, and ROI.
5. "What Key Performance Indicators (KPIs) will you focus on in the first 90 days, and what should my expectations be?" The first month is about data collection and testing, not scaling. They should be honest about this. They should be focused on leading indicators like Click-Through Rate (CTR) and Cost Per Landing Page View initially, before moving to CPL and CPA as they gather conversion data. If they promise you a 10x ROAS in the first month, they're either lying or naive. The process of finding a specialist who can provide a credible answer to these questions is something every founder in every city needs to learn, whether they are looking for help in Cambridge or Chicago.

Part 3: Red Flags and Dealbreakers

As you go through this process, certain red flags should make you run for the hills. Hiring the wrong agency is worse than hiring no agency at all, as they can burn through your budget and set back your growth by months.

• The "Guarantee": Anyone who guarantees results in paid advertising is a liar. There are too many variables. We can guarantee a professional process, transparent communication, and expert strategy, but we can't guarantee a specific ROAS.
• Long-Term Contracts from Day One: A confident agency will be happy to start with a 3-month trial period. They know they can prove their value in that time. An agency that insists on a 12-month contract from the start is likely insecure about their ability to perform.
• Focus on Vanity Metrics: If their proposal and reports are filled with talk of impressions, reach, and clicks, but light on details about CPL, CPA, and revenue, they are not focused on what matters.
• A "Secret Sauce" or "Proprietary Method": There are no secrets. Paid advertising is about a disciplined process of research, testing, and optimisation. Anyone who claims to have a secret is usually just hiding a lack of a real process.
• Poor Communication: In the vetting process, are they responsive? Do they answer your questions clearly and directly? If they are poor communicators before you've paid them, imagine what it will be like after you're locked into a contract.

The entire vetting process, from looking at case studies to asking these tough questions, is about one thing: finding evidence of genuine expertise. Many firms, even those in major hubs like London, can talk a good game. Your job is to find the ones who can actually play it.

What Should You Expect to Pay? Understanding Agency Models

Pricing can be confusing, so let's demystify it. There are three common models you'll encounter. None are inherently "better" than the others, but you should understand the incentives for each.

1. Percentage of Ad Spend:

The agency takes a percentage of your monthly ad spend as their fee, typically 10-20%.
Pros: Simple to understand. Scales with your budget.
Cons: Can create a perverse incentive for the agency to simply encourage you to spend more, rather than focusing on efficiency and profitability. This model works best when you have a large, established budget and are focused purely on scaling.

2. Flat Monthly Retainer:

You pay a fixed fee each month, regardless of ad spend.
Pros: Predictable costs. The agency is incentivised to deliver results to keep you as a client, not just to increase your spend. This is the model we prefer, as it aligns our success with our clients' success.
Cons: The fee is fixed even if your ad spend is small. It requires finding a retainer level that is fair for both parties.

3. Performance-Based:

The agency gets paid based on results, like a fee per lead or a percentage of revenue generated.
Pros: Seems low-risk for the client.
Cons: Can be very problematic. It can incentivise the agency to chase quantity over quality (e.g., generating thousands of cheap, garbage leads). It also ignores the fact that the agency doesn't control your sales process, your website conversion rate, or your product. It's often a sign of a desperate or inexperienced agency.

So, what should a US founder expect to pay? For a true specialist agency (not a cheap freelancer or a generalist), retainers typically start around $3,000 - $5,000 USD per month and go up from there depending on the scope of work (number of platforms, complexity, etc.). On top of that, you need your ad spend budget. I usually advise new clients to be prepared to spend at least $5,000 - $10,000 USD per month in ad spend to get enough data for meaningful optimisation. If an agency quotes you $500 a month, you're not getting an expert; you're getting someone who will press a few buttons and hope for the best.

Your First 90 Days: What to Expect When You Hire the Right Partner

You've done it. You've completed the homework, run the gauntlet of the vetting process, and chosen a specialist agency that you trust. What happens next? The first 90 days are critical for setting the foundation for long-term success. This is not the time for explosive, immediate returns; it's the time for methodical testing, learning, and data gathering.

Month 1: Foundation & Data Collection (The "Learning Phase")

The first 30 days are all about setup and launching initial tests. A good agency will spend significant time on onboarding, which includes a deep dive into your business, your ICP, your offer, and your past data. They'll install tracking pixels, set up conversion events, and build out the initial campaigns based on their primary hypotheses.

The main goal this month is to get data flowing. We need to see which audiences are responding, which ad creatives are getting the best CTR, and what the initial Cost Per Click and Cost Per Landing Page View look like. We are not expecting a profitable CPA yet. Anyone who panics after two weeks because the campaign isn't profitable doesn't understand how paid advertising works. We need to let the ad platforms' algorithms learn and gather enough data to make informed decisions. This initial period of what some call the 'learning tax' is unavoidable, and understanding how to manage it is a key difference between DIY ads and professional agency management.

Month 2: Optimisation & Iteration

By now, we have data. We can see which audiences and creatives are clear losers. The agency's job now is to be ruthless. They need to turn off what's not working and reallocate that budget to what is. This is also the time for iteration. If a particular ad angle is working, they should be creating new variations of it to see if they can improve performance further.

We'll start to see our key metrics, like CPL and CPA, begin to stabilise and hopefully trend downwards. We're also starting to get qualitative feedback. Are the leads being generated actually qualified? Are they booking sales calls? This feedback loop between the agency and your sales team is absolutely critical.

Month 3: Scaling & Expansion

With a set of proven audiences and creatives, and a stable, profitable CPA, it's time to start scaling. This doesn't mean just cranking up the budget by 10x overnight. That's a recipe for breaking the campaign. Scaling should be done carefully and incrementally, typically no more than 15-20% every few days, while closely monitoring performance.

This is also the time to think about expansion. Can we take our winning formula and apply it to a new platform (e.g., from LinkedIn to Google Search)? Can we expand our targeting to new lookalike audiences? Month 3 is about taking the validated learnings from the first two months and using them to drive real, profitable growth.

Conclusion: It's a Partnership, Not a Vending Machine

Hiring a paid ads agency isn't like buying a piece of software. You're not putting money in and getting a guaranteed result out. You are hiring a strategic partner, an extension of your marketing team whose expertise should complement your own.

The biggest mistake a founder can make is to abdicate all responsibility. The best agency-client relationships are highly collaborative. You bring the deep knowledge of your customer and your business; they bring the deep knowledge of the ad platforms and growth strategy. Together, you analyse the data, form hypotheses, and make decisions to grow the business profitably.

By following this guide—by doing the hard work upfront to understand your own business economics, by rejecting the myth of the local generalist, and by rigorously vetting for true, niche-specific expertise—you dramatically increase your chances of finding that partner.

It's a lot of work, but the alternative is spending the next year churning through mediocre agencies, burning your precious capital, and wondering why paid ads "don't work for your business." The truth is, they almost certainly can work. You just need the right foundation and the right partner to help you build on it.

If you're a US founder who has done the homework and is ready to talk to a specialist team that is obsessed with the maths of profitable growth, we offer a free, no-obligation 20-minute strategy session. We'll look at your business, your offer, and your goals, and give you our honest, unfiltered advice on whether paid advertising is the right fit for you right now. Feel free to book a time that works for you.