Former top Publicis exec Richard Pinder has spent his career at big networks like Grey, Ogilvy, and Leo Burnett before he became worldwide chief operating officer at Publicis Groupe's flagship agency. So after leaving that job in 2011, it was more than a little surprising to see him go public with a new entrepreneurial gig as a co-founder and CEO of The House Worldwide, a new take on global networks. The company has signed up independent agency, marketing and media partners around the world and in its beta phase worked with clients like Maserati. Pinder spoke with Adweek about his new industry model, how The House and its partners make money and why he’s given up an enviable Parisian life to return to his native U.K.
After you left Publicis, did you think of other career options or did creating this new company feel like the right next step?
I had previously thought a lot about it but hadn’t done anything about it and I had no time to focus on it until I left Publicis. I was 46 and I knew I had to do it. In the two years (after leaving the agency) people came to me with things and I stopped and thought for ten minutes, "Whoa, what if?" There were some big marketing roles or even heading up smaller businesses as CEO and, of course, agency discussions. I’d be lying if at some moments they weren’t interesting. But for one reason or another, they never gelled and this idea carried on gelling and built a life of its own.
Aside from industry considerations, why move from France and start your business in London?
I’m a huge fan of France. I spent seven years living there, my children were born there [and] I’ve only lived with my current partner in France, even though she’s Danish. France is our life, my family’s entire view of home. It’s one of the best places in the world to live but not necessarily the best place to work. … Aside from the high rate of tax for the very top earners, the government took a less-publicized step that essentially assured all start-ups had to run the same taxation and social charge program as existing businesses, which never used to be the case. In France you can also pretty much multiply by two the salary of any employee in terms of total company costs and if you hire someone and it’s not working out, there’s not much you can do about it.
What have you heard from marketers about how to create your new industry model?
When you don’t have a (corporate) business card and you’re talking to large global clients they’re more willing to talk candidly. Twenty years ago at Grey it was news if you had an office in the UK but now marketers want you to usually organize around clients, not geographies. Clients want talent focused on the business, rather than having the very best people end up at the top of the companies, which is normally the case at most professional service companies. Value which is important but not at the top of their priorities. That’s interesting because it’s not about price: Agency profit is about one percent of a normal client’s marketing budget. So while price is important, it’s not a key driver. What is important is, am I paying for what I need?
How did you assemble your partners?
They are people that either I or members of the core team have worked with before. We’ve made an informal rule that we shouldn’t partner with anybody we don’t know and trust and couldn’t vouch for with clients. … So you don’t have any of the games that go on in organizations that breeds politics when everyone agrees there is a problem but no one bothers to take responsibility to fix it.
Some of your closest working partners spent time at Leo Burnett, as you did. What’s the significance of that?
When Leo Burnett was private its values were absolutely amazing, it was a place with the most-low politics, and high-focus on the good things of the business: focus on clients, work, teams, international reach. You could criticize it about other things but that’s how it ended up going from humble beginnings to become the most creative network in the world in 2001. We think those values are what held a lot of people together; it wasn’t money or titles. Virtually everyone we work with has spent at least part of their career at that company.
Are you looking to expand your partner relationships?
There will be a time when we’re not always looking but right now, yes. If you look at geography, in the U.S., there clearly is opportunity to grow partners. We’d like to expand more in Asia [Pacific], including Australia, and a couple of markets in Europe, particularly Germany.
How do you and your partners make money?
There are a whole lot of ways to get paid but our principles are very simple: We will only charge when something is being done. It’s time-based and you agree on a number and you pay. If a partner in France introduces a client to a partner in Spain, there is a fee to be paid because there is no acquisition cost to the Spanish team. And if the French team continues to provide management advice, that’s where a percentage comes in—but we’re talking 10 and 20 percent, not 50 or 80 percent. At no point would I want to characterize it as a management fee or overhead. We’re trying to avoid the "o" word because we think it’s a killer of the current value equation in advertising. … We think each year you should revisit the value equation and say: "What am I doing for you?" That’s what partners and friends do which is why we like the name “The House” because we are trying to create a family-type atmosphere rather than an organizational atmosphere.
Virtually all of your career has been spent at large agency networks. What do you miss, what are you glad to be away from?
I was very proud and happy about what I did in the first 25 years of my career. No regrets, no issues and I’m not poking at that. I’m just looking at the opportunity rather than nagging away at a problem. People ask from time to time what do you miss and they imagine it’s the first-class hotels, the limousine at the end of the driveway, the fancy office. I spent five years working for (Publicis Groupe chief) Maurice Lévy and he doesn’t believe in any of that stuff. So I don’t miss it because I never had it at Publicis. About infrastructure and scale, the thing you realize when you create something of your own is that you turn up at a client and it’s not your business card that gets you in but your name. It’s odd, unusual, humbling, sobering and rewarding. It forces you to be at your absolute best and ironically at your most relaxed because if it fails the only person who is going to shout at you is you.