The Benefit of Hindsight

Gerry Graf’s success in advertising stems from his creative, rather than operational, acumen. The same goes for Ty Montague. But Graf, the departing New York CCO of Saatchi & Saatchi, and Montague, outgoing North American CCO at JWT, with partner Rosemarie Ryan (who resigned as JWT North American president) are launching their own agencies. And those who blazed the path before them say these creative minds will need to sweat the details as much as the quality of their work to establish lasting businesses.

They had other advice, too, shared with Adweek when we reached out to the principals of nine shops that opened between 2000 and 2009 (five are represented here, four more can be found online at adweek.com/agency). Some wish they’d taken more time to find the “right” partner, others that they’d skipped a few pitches. But most stressed the need of paying close attention to operational details. “If you don’t get the business of the business stuff right, you won’t be around for a long time,” said David Murphy, co-president of Barrie D’Rozario Murphy. His advice? Invest in top talent in finance, accounting and legal services.

Rockfish Interactive CEO Kenny Tomlin wished he’d spent more time selecting software systems. “We could have avoided a lot of hassle had I paid more attention to internal processes earlier,” he said.

Here, more lessons learned from some of the industry’s top talents.

Anomaly
Launched: 2004
Headcount: 100 (75 in New York, 25 in London)
Key clients: Nike (Converse, Umbro), Sony, Motorola; shop also in joint ventures with chef Eric Ripert and cosmetics enthusiast Lauren Luke
Smartest business decision:
Picking a distinctive name that “defines and differentiates” the shop, said partner Carl Johnson (pictured).
Biggest mistake: Not getting the partner casting 100 percent right the first time around, Johnson said. For example, the shop replaced founding creative chief Ernest Lupinacci with Mike Byrne in 2006. “The final partner lineup took a couple of detours in the first couple of years, delaying us hitting our full stride, which we are getting much closer to,” said Johnson.
“If I knew then what I know now . . . I would have given more thought to how best to scale an unconventional business like ours where talent is at a premium, creative thinking is crucial and process is extremely hard to impose and potentially damaging,” Johnson said.

The Barbarian Group
Launched: 2001
Headcount: 94 (52 in New York, 26 in Boston, 16 in San Francisco)
Key Ccients: General Electric, Samsung, Kashi, Red Bull
Smartest business decision: Opening during a recession, according to CEO Benjamin Palmer (at right). “There had been the dot-com bust and most of the small shops went out of business,” he said. “So, there was an opening of sorts for us to start small and scrappy-just four guys in an apartment for a while. Actually, I think the smartest business decision was just starting a business, realizing I’d never have a job I really loved unless I made it myself.”
Biggest mistake: Being “too big for our britches,” said Palmer. “Most of my big mistakes have been trying to do something that was outside of the abilities of myself or the company. But every time I make a mistake I’m like, ‘Fuck that, I will figure out how to pitch a client like that, figure out how to pull off that kind of work,’ and a year or two later we get stronger and we can handle it.”
“If I knew then what I know now . . . I would have worked at a big shop to learn more about marketing and management before setting off on my own,” Palmer said. “There are a lot of folks who will work at a big shop for years and learn all the secrets and get experience, and then leave to start their new thing-Ty [Montague], Gerry [Graf], etcetera. I never really knew that was an option. It seems way easier.”

Droga5
Launched: 2006
Headcount: 130  (85 in New York, 45 in Sydney)
Key Clients: Puma, Activision, Unilever (digital duties for Suave), TracFone, Method
Smartest business decision: Hiring from outside the industry, said creative chairman David Droga (pictured). The shop’s CFO, Judd Merkel, is from Citibank and CEO Andrew Essex is a former magazine editor. Droga also pointed to “putting the majority of our profits into hiring really smart senior people” and “not compromising ourselves for a quick buck.”
Biggest mistake: Droga cited “being flattered into crazy situations.” The reference is to pitch invites from five or six marketers during a three-month period in 2008, after Creativity named Droga5 agency of the year for 2007. The shop failed to win any of those pitches.
“If I knew then what I know now . . . I would have opened the agency earlier,” Droga said, echoing the sentiment of others. He added, “And bought more Apple stock.”

mcgarrybowen
Launched:2002
Headcount: 330 (276 in New York, 54 in Chicago)
Key clients: Chase, Verizon, Kraft Foods, Disney (parks and resorts), Chevron
Smartest business decision: Picking the right creative partner, said CEO John McGarry (at right). CCO Gordon Bowen “is the most unbelievable partner I’ve ever had,” he noted, citing Bowen’s skills as a creative director, leader and client handler.
Biggest mistake: Not starting sooner. “I wish I had another 40 years to go on this run,” McGarry said.
“If I knew then what I know now . . . we would have had” digital expertise from day one, McGarry said. The agency has since developed that capability and today, digital assignments-from clients such as Marriott and Chase-represent about a quarter of the
shop’s revenue.

Venables Bell & Partners
Launched: 2001
Headcount: 152 (San Francisco)
Key clients: Audi, Intel, HBO, Nestea, ConAgra, ConocoPhillips
Smartest business decision: Opening in the first place and putting a lot of thought into building an agency culture, said partner and cd Paul Venables (pictured). “The tendency is for grizzled creative veterans to open a shop and think it’s all about the ads. It isn’t. It’s about the people,” he said. “Attract the right people and they will create the right ads. And you can’t attract the right people if you have a culture that supports assholes under the guise of ‘the creative genius program.'”
Biggest mistake: Pitching too often and overaddressing the issue of agency size, Venables said. “We’d go to great lengths to prove we could handle a bigger piece of business. Gee, ya think we underscored our size limitation?” he asked. “You have to pitch from your strengths. … When you’ve clearly defined those advantages, line them up against the potential client. If you don’t see or hear them slapping the table that you’re right, pull out.”
“If I knew then what I know now . . . we would probably have said, ‘No thanks'” to pitch opportunities more often, Venables said.

Barrie D’Rozario Murphy
Launched: 2007
Key clients: United Airlines, Best Buy (new initiatives), United Health Group (brand identity)
Headcount: 30 (one office in Minneapolis)
Smartest business decision: Hiring top talent in finance, accounting and legal services. “Don’t try to save money in those areas,” said David Murphy, co-president. “If you don’t get the business of the business stuff right, you won’t be around for a long time.”
Biggest mistake: Not launching an agency sooner. “There are a number of people who think of doing this, but they put it off because they don’t know if it’s possible,” Murphy said.
“If I knew then what I know now . . . I’d have hired a good HR person at the get-go,” said Murphy. He stressed that having hiring policies and a benefits plan in place, for example, make the business of hiring easier.


Pereira & O’Dell

Launched 2008
Headcount 65 (in San Francisco; shop will open offices in New York and Bristol Bay, Alaska, in the next two months)
Key clients: University of Phoenix, Lego, Muscle Milk, Corona
Smartest business decision: Taking time to find the right partner, according to CEO Andrew O’Dell (pictured), who teamed up with P.J. Pereira as the digital shop’s chief creative officer. “So many new shops have great potential and promise, but are crippled by the partners’ egos and inability to agree on the smallest issues, which quickly add up and infect the entire company,” said O’Dell.
Biggest mistake: Nothing big, O’Dell said, but “small ones every day, [like] employees mistaking our landlord for a homeless person. Either I’ve blocked out the really bad ones or they haven’t happened yet. Either way, we always clean up the messes quickly.”
“If I knew then what I know now . . . I’d laugh,” O’Dell said. “The doom and gloom around the economy and the ad business was so bad that actually being in business two years later seemed laughable. Everyone said we were insane and it has given us an interesting perspective.”

The Brooklyn Brothers
Launched: 2002
Key clients: kgb, Unilever (Caress, Q-Tips), Cablevision, New Era Caps, Land Rover (London)
Headcount: 45 (half in New York and half in London)
Smartest business decision: To develop our own products and brands, said partner Guy Barnett. “Nothing teaches you how global business really works like a 6 a.m. dialog with China-in Mandarin-about plastic packaging. You get to learn the realities of business as opposed to just the marketing problems,” Barnett said.
Biggest mistake: Not dealing with tough problems quickly enough. “You learn pretty quickly that there’s no hiding from the most awkward of situations. And the toughest decisions need to be made swiftly before they affect the whole business,” said Barnett.
“If I knew then what I know now . . . I wouldn’t change a thing because getting some place faster isn’t always the most rewarding path,” Barnett said. “Experience comes from the detours and occasional cul-de-sacs.”


Rockfish Interactive

Launched: 2006
Key clients: Walmart, Sam’s Club, Tyson Foods, Cisco
Headcount: 85 (70 in Rogers, Ark. and 15 in Frisco, Texas)
Smartest business decision: Building the agency around strong technology capabilities, said CEO Kenny Tomlin (shown). “As a digital agency, we are building brand platforms and engagements for our clients across multiple touch points and technologies — all in-house,” Tomlin said. “This core competency has also allowed us to develop many proprietary technology solutions and products that we sell or license, which creates additional revenue streams for our company.”
Biggest mistake: Not focusing entirely on core competencies to start, said Tomlin. “I had no prior experience in traditional advertising and we did a mediocre job at best winning business in that space,” he said. “After our first year we shut down the traditional ad business and focused on our strength in digital. Our business doubled the second year and has every year since.”
“If I knew then what I know now . . . I would have spent more time when we were smaller thinking about the [software] systems we would use to manage our operation,” Tomlin said. “This year we converted everything into an agency management software solution and it has been painful.”