After the usual agency denial phase (something you learn about quickly here at AgencySpy), The Barbarian Group confirmed today that South Korea’s Cheil Worldwide acquired a majority stake in the Boston/New York-based digital firm. While Cheil already looked westward by purchasing a minority interest in London-based agency Beattie McGuinness Bungay late last year, the Barbarian buy marks a much more prominent step for the ad network to establish a solid US presence.
Despite operating 31 offices in 25 countries and hiring a host of notable creatives from the likes of JWT and Leo (Alistair Wood) and Chiat and Atmosphere BBDO (Timothy Bruns), Cheil has flown relatively under the radar when compared to advertising’s Big Four. Now, with the addition of a lauded digital outfit like Barbarian–one of those included in my notorious Digital Done Right piece from May–perhaps Cheil can attain what CEO Nack Hoi Kim says is its goal of “being among the world’s top 10 agencies by 2012.”
While financial terms weren’t disclosed, though $10-20 million has been floated around, Barbarian looks to obviously gain the most from the deal. First off, the leadership–cofounders Benjamin Palmer, CEO; Rick Webb, COO; and Keith Butters, Chief Experience Officer–remains intact and will continue to steer the company out of New York. This is the same group who started the company for $500 in borrowed cash in 2001, made a name for themselves in ’04 with “Subservient Chicken” and then went onto spearhead innovative work for clients ranging from Getty and CNN.com to Dove and VW plus lest we forget, this month’s Esquire Augmented Reality issue.
Second, as CEO Palmer told Nick Parish at AdAge today, the Barbarians can expand size and location. “It’s exactly time for us to make a big, new move,” Palmer said. “In some ways, that’s growing in size and location, and in some ways it’s becoming more capable at handling the great unknown of the future.”
Third, the Barbarian Group can benefit from the stable Cheil infrastructure and investments in R&D, software and hardware. The Barbarians themselves after all developed their own software tools like Plainview and Magnetosphere; now they can continue to build this department out. COO Webb adds on the Barbarian homepage, “With our creative leadership and their global network (over 1,500 employees in 25 countries), we’re setting the stage for the next great phase of this company. Increased potential for greater R&D. The ability to really delve into solving marketing’s difficult problems. More capabilities for our clients.”
While Cheil meanwhile adds to its digital portfolio and further advances its global agency status, one of the more interesting things to take from all this is that Barbarian opted to look for as Palmer says an “untapped” company across the globe for investment than be subject to the whims of the usual agency holding companies. It’s an intriguing, if not risky move by the Barbs, but at this point, we wouldn’t expect anything else. Now the question remains whether this deal will in any way compromise that risk-taking spirit.