Efficient communication between cells requires the ability to process precursor proteins into their mature and biologically active forms, prior to secretion into the extracellular space. Eukaryotic cells achieve this via a suite of enzymes that involve a signal peptidase complex, prohormone convertases and carboxypeptidases. Using genome and transcriptome data of the demosponge Amphimedon queenslandica, a universal ancestor to metazoan multicellularity, we endeavour to bridge the evolution of precursor processing machinery from single-celled eukaryotic ancestors through to the complex multicellular organisms that compromise Metazoa. The precursor processing repertoire as defined in this study of A. queenslandica consists of 3 defined signal peptidase subunits, 6 prohormone convertases and 1 carboxypeptidase, with 2 putative duplicates identified for signal peptidase complex subunits. Analysis of their gene expression levels throughout the sponge development enabled us to predict levels of activity. Some A. queenslandica precursor processing components belong to established functional clades while others were identified as having novel, yet to be discovered roles. These findings have clarified the presence of precursor processing machinery in the poriferans, showing the necessary machinery for the removal of precursor sequences, a critical post-translational modification required by multicellular organisms, and further sets a foundation towards understanding the molecular mechanism for ancient protein processing.