After 18 years running his own advertising and marketing firm, Todd Muffley is ready to slow down.
Muffley announced this week he has sold his Carmel-based ad agency, Fat Atom Marketing, to two of his employees, husband-and-wife duo Jennifer and Adam Fox.
Although Muffley declined to divulge terms of the sale, he told IBJ he sold the firm for 7.5 times EBITDA (earnings before interest, taxes, depreciation and amortization). The transaction closed this month.
“I’m definitely turning the company over to people smarter than me,” Muffley said.
Muffley, who turns 48 next week, started Fat Atom as Plan B Marketing in 2005, shortly after selling Creative Indoor Advertising, which he launched in 1999.
Creative Indoor Advertising specialized in selling advertising on the walls above urinals. Fat Atom’s bread and butter is digital marketing.
Muffley built a solid client base at Fat Atom before the firm lost out on a big, national account and went through a rough patch in 2014. Since then, Muffley said, “the company has been on a tear.”
Fat Atom, which has 20 employees, grew its revenue from $950,000 in 2014 to $1.2 million in 2015 to a record $2 million last year.
“That revenue doesn’t include media buying and other pass-through money,” Muffley said. “That’s real work.”
In 2016, Fat Atom was the Indianapolis area's 17th largest advertising agency in terms of employees, according to the IBJ Book of Lists.
Muffley said the turning point for Fat Atom came in late 2014 when the company signed a deal to do work for Credit Acceptance, one of the nation’s largest sub-prime auto loan companies.
Now, Fat Atom counts OB/GYN of Indiana, Fairbanks Treatment Addiction Center, Williams Comfort Air, Indiana Limestone, Westfield Steel, Superior Oil and PAI Medical Group among its clients. Jennifer Fox said about half the firm’s 40 clients are in Indiana.
In March, Fat Atom signed a contract to do work for Chicago-based heat treatment company SuperHeat, which is the firm’s biggest deal to date, Muffley said.
Fat Atom will remain housed in a building Muffley owns at 141 N. Rangeline Road, and Muffley will continue as a consultant for the firm for the next five years.
Muffley said the sale will allow him to spend more time with his family and on his hobbies.
Meanwhile, Jennifer Fox, 36, will be the firm’s president, and Adam Fox, 37, will be vice president and marketing director.
Fox admits she was a little taken aback when Muffley approached her and her husband about buying the company. They bought a minority interest in the company in 2014, and Muffley said he used that money to boost the firm.
“When he came to us about buying the whole thing, I was a little surprised, but delighted, because we both put our heart and soul in our job and love what we do,” Fox told IBJ. “We can’t imagine ever working anywhere else.”
Fox, who has worked with Muffley since 2003, said she and her husband hope to set Fat Atom on a course that will lead to 20 percent annual growth.
“We want growth to be steady and sustainable,” she said.
Fox is confident the staff in place can make that happen.