Don’t call Miles Nadal an acquirer. Rather, the CEO of MDC Partners sees himself as a strategic partner to the agencies he buys.
Nadal stressed that point on Wednesday (March 9) during an interview with The New York Times’ Andrew Ross Sorkin at the 4A’s Transformation 2011 conference in Austin, Texas. Largely, the head of one of the smaller ad holding companies used his half-hour with Sorkin to distance himself from the CEOs of industry giants WPP Group, Omnicom Group and Interpublic Group, who had just left the stage.
Noting WPP CEO Martin Sorrell’s earlier point about the need for the industry to add chief talent officers on their boards, Nadal said bluntly, “Well, that’s bullshit because I am the chief talent officer. That’s my primary responsibility.”
As for clients not always thanking agencies for great work—a complaint of Omnicom CEO John Wren—Nadal said holding companies themselves don’t do enough to recognize their employees. “In our particular case, anytime there’s a birthday, somebody does anything terrific, they get an appointment, they do some phenomenal work, I am the first person to send them a note and say, ‘Congratulations on what you did. We’re very privileged by our association with you and it’s people like you that reinforce our reputation as a place where great talent lives.’”
Of course, MDC—with an annual revenue of approximately $700 million and some 14,000 employees—is a fraction of the size of the other holding companies. Nadal can afford to shower his agency leaders with affection simply because it’s a much smaller group. That said, his reputation for providing money and support to agencies like Crispin Porter + Bogusky without telling them what to do makes MDC more appealing to some shops looking to sell. He also generally doesn’t buy 100 percent of what he invests in, as was the case in his early 2011 deals with Anomaly and 72andSunny.
Asked if Crispin could have been as successful without the backing of MDC, Nadal said, “No one really knows, but I’ll tell you my point of view. Not a chance. Why? They wouldn’t have invested in 400 new people in planning. They wouldn’t have expanded to Sweden. They wouldn’t have gone to Boulder and hired 600 people. They wouldn’t have made the acquisitions they’ve made. They wouldn’t have invested in technology.”
Nadal added that “at the same time, they were still able to get all their distributions. I put up a hundred percent of the capital. Nobody had to sign personally. So, I didn’t make them smarter or more effective. I just gave them the resources to explore the entrepreneurial opportunities on a bigger platform.”
While Nadal questioned why Sorrell, Wren and IPG CEO Michael Roth did not cite Crispin as the agency they most admire, he agreed that their choice—Wieden + Kennedy—is a “great micro-network.” Nadal added, “They service global brands from, I don’t know, five or six or seven or eight offices and that is the model of the future. You don’t need to have that [many]. And in fact, most of the firms have a problem because they [have] 64 offices in 32 countries. Thirty-eight of them don’t make any money and they’re being carried [by the rest].”
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