How Do 5 Partners Lead a Successful Digital Agency?
How do you make decisions when there are multiple agency partners? Can you truly grow without second-guessing the big decisions? How do you grow an agency with multiple partners? Should you build from within or use acquisition as a growth strategy? When there are many decision-makers at an agency it can be a challenge to agree on the best way to grow. But with mutual respect and a yin-yang of strengths, it can work.
In today’s episode, we’ll cover:
- Can things really work with multiple agency partners?
- Using acquisition as an agency growth strategy.
- Deciding on when and which agency to acquire.
- How to get through an economic recession.
I chatted with Peter Bishop, Partner and Director at ZGM Marketing Partners in Canada. He has been in digital marketing for over 20+ years and, as it turns out, we share a ton of old-school experience on the evolution of design software. But, now as a partner at ZGM, he is on the show to share what he’s learned about sharing partnership with four others as well as how they use acquisition as a growth strategy.
Can Things Really Work with Multiple Agency Partners?
Having one owner can be great or it can be awful. We all have biases but when it comes to agencies, they are led by creative souls and that is usually the backbone of an agency. As Peter points out, creatives aren’t usually awesome at finance or other business skills. Having a partnership that balances each other out is usually beneficial.
Peter’s agency partnerships include a creative person, financial person, an accounts person... so everyone brings something different to the table. There are rarely problems among them, but when there is a problem it’s a big problem.
How To Get Through Partner Disagreements
Peter says the agency partnership is like any relationship. When there’s mutual respect you can get through anything. Although ZGM has five partners, there is one partner who has stepped away from day-to-day involvement and is more like a silent investor.
The partners involve him in the bigger decisions and Peter says, he’s become like the wise grandfather figure. He is more objective and also calls bullshit on them when necessary. Every partnership needs this type of unbiased person, board of advisors, or even a mastermind who is looking out for the best interest of the agency.
We can’t do it all by ourselves, so having others helping and guiding is the best way to build and grow. Holding things close to your chest is no longer the way to do business. When we all share, we all develop and grow. Providing advice to others can also provide clarity for yourself.
Using Acquisition as an Agency Growth Strategy
ZGM has used acquisition as a growth strategy and Peter attributes much of their growth to this decision. They've acquired three agencies so far, and each time there’s an acquisition he feels significant growth in clients and staff, as well as in top-line revenue.
Culture is key and it’s one of the first things ZGM looks at before considering an acquisition. It sounds cliche it’s true - culture is everything. Agencies can’t pay top dollar for talent but culture is where they compete. Top talent can be drawn to the right culture. And, your agency co-workers usually become like a second family. So a culture that fits is key in making sure the family functions. So when merging or acquiring another agency, culture fit is one of the most important aspects.
How to Decide When and What Agency to Acquire
ZGM has been very strategic about its acquisitions. They have found that when they want to go into a new direction -- more product-based accounts, for example -- doing it organically isn’t realistic. So their growth strategy has been focused on acquisitions that can help them break barriers that afford them growth in new areas.
Getting Through the Current Economic Recession
Now more than ever, our clients are leaning on us to be creative and solve their business problems. Peter and partners have told their team, instead of looking for bigger spends or more money, ask how can you help clients get through this crisis. We need to help clients figure out ways to pivot their business and survive the economic recession.
Bottom line, money isn’t everything. Now is the time to be human.