{"id":1933,"date":"2016-05-23T07:20:48","date_gmt":"2016-05-23T06:20:48","guid":{"rendered":"https:\/\/marvel7077.wpengine.com\/?p=1933"},"modified":"2020-09-03T12:53:56","modified_gmt":"2020-09-03T11:53:56","slug":"state-of-the-digital-nation-2016","status":"publish","type":"post","link":"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/","title":{"rendered":"State of the Digital Nation 2016"},"content":{"rendered":"<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">In 2013, we explored the state and future of the digital consultancy industry, posing the question \"<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/medium.com\/@ezyjules\/how-when-and-where-will-the-first-truly-great-digital-design-studio-emerge-79e911cbc425#.onilymdv3\" target=\"_blank\" rel=\"noopener noreferrer\">How, When and Where Will The First Truly Great Digital Design Studio Emerge?<\/a>\". Three years later in 2016, enough time has passed to discern patterns from trends. In that time the industry has experienced seismic shifts and a sweeping wave of consolidation. So let\u2019s take another look at the state of the digital nation and why, for the bold, great opportunity lies ahead. Indulge me on a four course stream of consciousness on the business of digital.<\/p>\n<ul class=\"pageWrap pageWrap--s list list--unordered marginBottom-l lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">\n<li><strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"#chapter-one-industry-perspective\">Chapter I: Industry Perspective:<\/a><\/strong> A look at the what, who, and why of consolidation, Digital Product explained, what lies behind advertising\u2019s existential crisis, and the brewing clash of the titans between Ad Holding Groups and management consultancies.<\/li>\n<li><strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"#chapter-two-agency-perspective\">Chapter II: Agency Perspective:<\/a><\/strong> The red hot agency market, the reality behind buying and selling, calling bullshit on the \u2018end of consultancy\u2019, the designer\u2019s delusion, and the second coming of the independent studio.<\/li>\n<li><strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"#chapter-three-new-perspective\">Chapter III: New Perspective:<\/a><\/strong> Escaping the agency cycle, finding inspiration and perspectives in the startup studio model and in the venture and own product initiatives of progressive agencies.<\/li>\n<li><strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"#chapter-four-future-perspective\">Chapter IV: Future Perspective:<\/a><\/strong> The blueprint for the next evolutionary step for the studio model... the Digital Product Studio.<\/li>\n<\/ul>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">There\u2019s plenty of additional reading in the links for those who want to go down the rabbit hole, as well as a reference table at the end. Happy to continue the discussion on Twitter using the hashtag <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.twitter.com\/hashtag\/DigitalNation\" target=\"_blank\" rel=\"noopener noreferrer\">#DigitalNation<\/a> at <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.twitter.com\/ezyjules\" target=\"_blank\" rel=\"noopener noreferrer\">@ezyjules<\/a> and <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.twitter.com\/marvelapp\" target=\"_blank\" rel=\"noopener noreferrer\">@marvelapp<\/a>.<\/p>\n<section class=\"mask-top aspectRatio aspectRatio--16-9 is-loading is-loading--xl bg-snow width-100 marginTop-l\"><span class=\"aspectRatio-content zi-chrome display-block\"><img class=\"b-lazy position-relative width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Pacman.jpg\" title=\"\" alt=\"\" \/><\/span><\/section>\n<section id=\"chapter-one-industry-perspective\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\"><span class=\"marginTop-xl display-block c-slate fontSize-xxl lineHeight-xxl breakPointM-fontSize-xxxl breakPointM-lineHeight-xxxl breakPointL-fontSize-xxxxl breakPointL-lineHeight-xxxxl fontWeight-5\">Chapter I: Industry Perspective<\/span><\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">A sweeping wave of acquisitions has decimated the ranks of independent agencies and formed two clashing clans. On the one side are the giants of advertising and marketing and on the other the titans of management consultancy. Meanwhile the market over which they are fighting is in the midst of a multi-faceted existential crisis.<\/span><\/p>\n<section id=\"the-great-consolidation\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The Great Consolidation<\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"dropcap\">O<\/span>ver the last four years the design consultancy industry has experienced an unprecedented period of consolidation, building to a frenzy in 2015 with yet another flurry of acquisitions. 2012 and 2013 saw the big fish Ad Holding Firms WPP, Omnicom, Publicis, Interpublic, and Dentsu buying up digital marketing agencies. 2014 and 2015 heralded the era of the big 5 management consultancies such as Accenture, Deloitte, McKinsey, and KPMG snapping up independent design consultancies (a trend foreshadowed by Accenture\u2019s acquisition of Fjord in 2013).<\/p>\n<section class=\"width-100 position-relative display-none breakPointL-display-block\"><svg class=\"position-absolute pinTL\" width=\"168\" height=\"156\" viewBox=\"0 0 168 156\" style=\"left: -20px; transform: scaleX(-1)\"><rect class=\"fill-pink\" x=\"12\" y=\"34\" width=\"12\" height=\"11\" \/><path class=\"fill-pink\" d=\"M156,68V34H144V23H132V11H108V0H60V11H36V23H24V34H48V45H60V77H48V88H24V77H12V68H0v88H12V145H24V133H36v12H48v11H72V133H96v23h24V145h12V133h12v12h12v11h12V68H156Zm-24,9H120V88H96V77H84V45H96V34h24V45h12V77Z\" \/><rect class=\"fill-purple--d\" x=\"12\" y=\"57\" width=\"24\" height=\"20\" \/><rect class=\"fill-purple--d\" x=\"84\" y=\"57\" width=\"24\" height=\"20\" \/><\/svg><svg class=\"position-absolute pinTR\" width=\"168\" height=\"156\" viewBox=\"0 0 168 156\" style=\"right: -40px; top: -400px\"><rect class=\"fill-yellow--d\" x=\"12\" y=\"34\" width=\"12\" height=\"11\" \/><path class=\"fill-yellow--d\" d=\"M156,68V34H144V23H132V11H108V0H60V11H36V23H24V34H48V45H60V77H48V88H24V77H12V68H0v88H12V145H24V133H36v12H48v11H72V133H96v23h24V145h12V133h12v12h12v11h12V68H156Zm-24,9H120V88H96V77H84V45H96V34h24V45h12V77Z\" \/><rect class=\"fill-marvel\" x=\"12\" y=\"57\" width=\"24\" height=\"20\" \/><rect class=\"fill-marvel\" x=\"84\" y=\"57\" width=\"24\" height=\"20\" \/><\/svg><svg class=\"position-absolute pinTR\" width=\"168\" height=\"156\" viewBox=\"0 0 168 156\" style=\"right: -40px; top: 600px\"><rect class=\"fill-marvel--l\" x=\"12\" y=\"34\" width=\"12\" height=\"11\"><\/rect><path class=\"fill-marvel--l\" d=\"M156,68V34H144V23H132V11H108V0H60V11H36V23H24V34H48V45H60V77H48V88H24V77H12V68H0v88H12V145H24V133H36v12H48v11H72V133H96v23h24V145h12V133h12v12h12v11h12V68H156Zm-24,9H120V88H96V77H84V45H96V34h24V45h12V77Z\"><\/path><rect class=\"fill-pink--d\" x=\"12\" y=\"57\" width=\"24\" height=\"20\"><\/rect><rect class=\"fill-pink--d\" x=\"84\" y=\"57\" width=\"24\" height=\"20\"><\/rect><\/svg><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Some highlights of the 2014 \/ 2015 shopping list...<\/p>\n<section class=\"money-list heart-list marginTop-l\">\n<ul class=\"pageWrap pageWrap--s list list--unordered marginBottom-l lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/techcrunch.com\/2015\/07\/22\/chaotic-moon-sells-to-accenture\/\" target=\"_blank\" rel=\"noopener noreferrer\">Chaotic Moon sold<\/a> and <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.campaignbrief.com\/2014\/12\/accenture-to-acquire-reactive.html\" target=\"_blank\" rel=\"noopener noreferrer\">Reactive sold<\/a> to Accenture Interactive<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.wired.com\/2015\/05\/consulting-giant-mckinsey-bought-top-design-firm\/\" target=\"_blank\" rel=\"noopener noreferrer\">Lunar Design sold<\/a> to McKinsey Digital Labs<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/digiday.com\/agencies\/inside-deloitte-1-5-billion-ad-agency\/\" target=\"_blank\" rel=\"noopener noreferrer\">Mobiento sold<\/a> to Deloitte Digital<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/startups.co.uk\/digital-consultancy-seren-acquired-by-ernst-young-llp\/\" target=\"_blank\" rel=\"noopener noreferrer\">Seren sold<\/a> to Ernst &amp; Young<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/adage.com\/article\/agency-news\/publicis-completes-deal-acquire-sapient\/297020\/\" target=\"_blank\" rel=\"noopener noreferrer\">Sapient sold<\/a> to Publicis Groupe for $3.7 billion<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/techcrunch.com\/2014\/10\/02\/adaptive-path-acquired-by-capital-one\/\" target=\"_blank\" rel=\"noopener noreferrer\">Adaptive Path sold<\/a> to Capital One<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.business-standard.com\/article\/companies\/wipro-to-acquire-designit-for-93-mn-115070900739_1.html\" target=\"_blank\" rel=\"noopener noreferrer\">DesignIt sold<\/a> to WiPro<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.unquote.com\/nordics\/official-record\/72889\/fsn-capital-sells-tactel-to-panasonic-avionics\" target=\"_blank\" rel=\"noopener noreferrer\">Tactel sold<\/a> to Panasonic Aviation<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/gigaom.com\/2012\/03\/16\/exclusive-emc-buys-pivotal-labs\/\" target=\"_blank\" rel=\"noopener noreferrer\">Pivotal Labs sold<\/a> to EMC in 2012 and <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/techcrunch.com\/2015\/10\/14\/dell-needs-to-decide-what-to-keep-and-what-to-sell-after-emc-deal\/\" target=\"_blank\" rel=\"noopener noreferrer\">EMC sold<\/a> to Dell in 2015<\/li>\n<li>Bucking the trend <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.teehanlax.com\/story\/our-next-act\/\" target=\"_blank\" rel=\"noopener noreferrer\">Teehan+Lax opt for a dignified dissolution<\/a><\/li>\n<\/ul>\n<\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Brief pause for breath... and into the 2016 new year sales:<\/p>\n<section class=\"money-list paddingTop-xxs\">\n<ul class=\"pageWrap pageWrap--s list list--unordered marginBottom-l lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.thedrum.com\/news\/2016\/01\/29\/st-ives-group-agrees-50m-deal-acquire-app-business\" target=\"_blank\" rel=\"noopener noreferrer\">The App Business (TAB) \u00a322M<\/a> and <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.chicagotribune.com\/bluesky\/originals\/chi-solstice-mobile-st-ives-acquisition-bsi-20150317-story.html\" target=\"_blank\" rel=\"noopener noreferrer\">Solstice Mobile $36M<\/a> sold to St Ives<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.wsj.com\/articles\/mark-penns-stagwell-acquires-creative-agency-code-and-theory-1452027259\" target=\"_blank\" rel=\"noopener noreferrer\">Code &amp; Theory<\/a> sold to Stagwell<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/fortune.com\/2016\/02\/02\/ibm-digital-firm-aperto\/\" target=\"_blank\" rel=\"noopener noreferrer\">Aperto sold<\/a> and <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.forbes.com\/forbes\/welcome\/#30e89b9c3a89\" target=\"_blank\" rel=\"noopener noreferrer\">Resource\/Ammirati sold<\/a> to IBM<\/li>\n<li>Creative marketing agency <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.fastcodesign.com\/3056415\/ideo-silicon-valleys-most-influential-design-firm-sells-a-minority-stake\" target=\"_blank\" rel=\"noopener noreferrer\">Brooklyn Brothers sold<\/a> to IPG<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.fastcodesign.com\/3056415\/ideo-silicon-valleys-most-influential-design-firm-sells-a-minority-stake\" target=\"_blank\" rel=\"noopener noreferrer\">IDEO sold<\/a> a minority stake to Japan\u2019s Hakuhodo DY Holdings<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.prnewswire.com\/news-releases\/capgemini-acquires-innovation-and-design-consultancy-fahrenheit-212-to-drive-north-america-growth-through-digital-innovation-offerings-300222214.html\" target=\"_blank\" rel=\"noopener noreferrer\">Fahrenheit 212 sold<\/a> to Capgemini<\/li>\n<li><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.adweek.com\/news\/advertising-branding\/deloitte-acquires-acclaimed-san-francisco-creative-shop-heat-169916\" target=\"_blank\" rel=\"noopener noreferrer\">Heat sold<\/a> to Deloitte Digital<\/li>\n<\/ul>\n<\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">That\u2019s a whole lot of design legacy, revenue, and talent being assimilated. The reasons behind it mean that we need to preface our journey with an important definition.<\/p>\n<section id=\"wtf-is-digital-product\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">WTF is Digital Product<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Terminator.jpg\"><img class=\"b-lazy position-relative width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Terminator.jpg\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">What is \u2018Digital Product\u2019? In as human speak as possible\u200a\u2014\u200ain the style of trying to explain to my mother what I do &mdash; here goes...<\/p>\n<section class=\"pageWrap pageWrap--s position-relative marginBottom-l paddingLeft-l paddingTopBottom-xs fontWeight-3 c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl\">A Digital Product is a software enabled product or service that offers some form of utility to a human being.<span class=\"position-absolute pinTL bg-marvel borderRadius-s\" style=\"width: 3px; bottom: 0\"><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Real world examples: Your favourite car service app such as Uber or Lyft, your mobile banking app with Chase or Barclays, your shoppable H&amp;M or Nike app, the digital dashboard in your Tesla car (lucky you), the interface of your consumer electronics devices such as your phone or smartwatch, the controller app for your Sonos speakers, or an investment bank broker\u2019s trading platform. Some products and services are made up mostly or entirely of software such as your Facebook messaging or Tinder \u2018dating\u2019 app. This is the <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.wsj.com\/articles\/SB10001424053111903480904576512250915629460\" target=\"_blank\" rel=\"noopener noreferrer\">software that is eating the world<\/a> as almost all businesses come to be digitised and run on software.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The digital touchpoint through which a human interfaces with said product or service can sit on many types of platforms and devices. Those can include web, mobile, auto, wearables, VR and beyond. Things are slowly moving beyond the visual interface towards the more natural form of conversational interface. Such examples are speaking with your Amazon Echo or accessing services in written conversation in your messaging app. Because you interact with the product, it does more than simply display information, as say a marketing website does. Complex interactions take place between the part you use (the front-end) which is connected (integrated) into the wider system that runs the service in its entirety (the back-end). This means software is core to it all.<\/p>\n<section class=\"pageWrap pageWrap--s position-relative marginBottom-l paddingLeft-l paddingTopBottom-xs fontWeight-3 c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl\">\u2018Digital product\u2019 or \u2018product\u2019 work is the delivery of the digital touchpoints of a product or service.<span class=\"position-absolute pinTL bg-marvel borderRadius-s\" style=\"width: 3px; bottom: 0\"><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Delivery can involve end-to-end concept, design, and engineering of the digital product, bringing it through to market launch and beyond. Delivery can draw on multiple disciplines of not only design and engineering but also business strategy, product management, data science, and marketing.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">There are multiple players involved as well as not inconsiderable cost. So the aim is to make the process as holistic as possible in order to get the product to market efficiently. So the method by which you deliver the product becomes as important as the product itself. Well-established best practices of product development include integrated teams, Agile (not waterfall), SCRUM, Lean, and Continuous Delivery methodologies. All of this makes digital product delivery an expensive investment. Engagements can run over many quarters and even years, commanding a high premium and margin. The budget for this kind of work usually comes from places other than the marketing department, which usually makes shorter-term, campaign-based investments.<\/p>\n<blockquote class=\"pageWrap pageWrap--s position-relative marginTopBottom-l breakPointM-marginTopBottom-xl\"><div class=\"blog-quote-before position-absolute bg-marvel\"><\/div><div class=\"tweet-quote blog-quote-after position-absolute bg-marvel cursor-pointer transitionDuration-l transitionProperty-all transitionTimingFunction-cv-easeOutCircular scaleUp--hover zi-weak\"><svg class=\"fill-white opacity-0 pointerEvents-none position-absolute pinCenter transitionProperty-all transitionTimingFunction-easeInOut\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"24\" height=\"20\" viewBox=\"0 0 24 20\"><path d=\"M24,2.37a9.64,9.64,0,0,1-2.83.79A5,5,0,0,0,23.34.37a9.72,9.72,0,0,1-3.13,1.23A4.86,4.86,0,0,0,16.62,0a5,5,0,0,0-4.8,6.2A13.87,13.87,0,0,1,1.67.92,5.13,5.13,0,0,0,3.19,7.67,4.81,4.81,0,0,1,1,7a5,5,0,0,0,3.95,5,4.82,4.82,0,0,1-2.22.09,4.94,4.94,0,0,0,4.6,3.51A9.72,9.72,0,0,1,0,17.73,13.69,13.69,0,0,0,7.55,20c9.14,0,14.31-7.92,14-15A10.17,10.17,0,0,0,24,2.37Z\"\/><\/svg><\/div><p class=\"blog-quote position-relative textAlign-center c-marvel\"><span class=\"blog-quote-text transitionDuration-l transitionProperty-all transitionTimingFunction-easeInOut\">Design has become recognised as a critical factor in creating successful products and services.<\/p><\/span><\/blockquote>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The point of this massively distracting aside is this. All businesses are becoming heavily software driven. So client demand has shifted towards the actual delivery of digital products and services into market, rather than just the strategy behind or marketing of them. In addition <em>Design<\/em> has become recognised as a critical factor in creating successful products and services. All of this has placed a premium on those skills and the relatively few companies that can offer it. Thus the red hot M&amp;A market.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">For those who wish to nerd out on the topic, here\u2019s pretty great stab at <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/medium.com\/@nodesource\/what-is-digital-product-design-93caad4e4035#.p26ii8jlt\" target=\"_blank\" rel=\"noopener noreferrer\">What is Digital Product Design<\/a> by Paul Devay.<\/p>\n<section id=\"shrug\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">\u00af\\_(\u30c4)_\/\u00af<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Shrug.png\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Shrug.png\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">So what\u2019s with all the M&amp;A action? From a revenue perspective, Ad Holding Groups have been going from strength to strength in recent years. With their amassed wealth they have have been busily buying up digital agencies. They have done so to cover capability gaps and round out their all-encompassing client offering. This was all about \u2018doing digital\u2019 in a world going fully digital and sweeping up any remaining significant non-group affiliated players and their clients\/revenue.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Digital represents an ever increasing greater share of their revenues, topping 40% for the first time in 2015. The fresh-off-the-press Ad Age <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/adage.com\/article\/agency-news\/agency-report-web-mainbar\/303704\/\" target=\"_blank\" rel=\"noopener noreferrer\">Agency Report 2016<\/a> shares some juicy stats: Over the last six years digital\u2019s share of US agency revenue jumped from 25.8% in 2009 to 41.3% in 2015. For Publicis Groupe, digital represented 51.9% of worldwide revenue and for WPP 37.5%. The point is that the Ad Holding Groups are responsible for a huge portion of the digital industry and what happens there affects us all.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Looking at these figures, you'd think doing digital in ad-land is like making hay while the sun shines. You'd be wrong. The weather is about to turn and the industry, heavily centred on ad tech and the execution of digital marketing, is ill-prepared. Whilst the big names in advertising have made many ad tech and agency acquisitions and postured heavily in trade publications, they have failed to meaningfully commit to the field of digital product. The consequences for their failures here are profound; they are standing on a burning platform, and they lack the right skills and DNA to build a new one (figuratively and literally). In short: The ad industry is tipping into an unprecedented existential crisis.<\/p>\n<section id=\"rome-is-burning\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Rome is Burning<\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">It may seem bizarre to claim that a $50B a year and growing industry is in peril. But whilst executives quaff ros\u00e9 at the self-congratulatory circle jerk that is Cannes, Rome slowly burns. Multiple fires have been smouldering away over decades with more starting every year: service commoditisation, low technical competence, failure to grapple with digital product work, death of linear TV, ad blocking, robots, data judgement, the end of AOR, a people and lifestyle problem, a talent drain, and... a new gang in town out to steal their turf.<\/p>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Trends.png\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Trends.png\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The rapid commoditisation of the services the industry offers will continue to erode profit margins. As mobile engineers slowly become as ubiquitous as web engineers the premium on skin deep mobile marketing work will disappear. Margins will go south the same way of once bountiful web marketing work. We have seen that pattern play out on platform after platform.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">People are deleting advertising from their lives. Many simply don\u2019t like or want it and now for the first time they have a choice in the matter. With the shift to streaming, the so-called \u2018millennial\u2019 has abandoned linear TV and, in turn, the ads that grace it. (Who can blame them? <span class=\"display-none breakPointM-display-block position-relative float-left bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTop-m marginBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 280px; margin-left: -60px; box-shadow: -12px 12px 0 0 #009EEB; top: -6px; margin-right: 25px\">In the US alone an estimated 45 million are using ad-blocking technology and eMarketer predicted that 15 million people in the UK would begin using ad-blockers by the end of 2017.<\/span> Have you tried watching an episode of anything in the US without developing ADD from all the ad breaks). Higher-income consumers are more able to afford an ad-free existence by paying subscriptions for ad-free service experiences such as YouTube Red, Hulu+, or Spotify. This further erodes the pool of young, upwardly-mobile consumers that the ad industry so covets. In the future, only older, poorer people will experience advertising.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The industry found hope in Nielsen\u2019s 2015 \u2018Global Trust in Advertising\u2019 report. It heralded millennials as showing \u201cthe highest levels of trust in online and mobile formats.\u201d. But a 2016 KPMG study found that the very same group was most likely to block ads with 60% of 16- to 24-year-olds planning do to so in the next six months. It also found that wealthier consumers are more likely to block ads. In the US alone an estimated 45 million are using ad-blocking technology and eMarketer predicted that 15 million people in the UK would begin using ad-blockers by the end of 2017. Clearly the issue of trust is meaningless without like or want (I trust my dentist, which doesn\u2019t mean I want to unnecessarily spend time with him). This presents a serious challenge to an industry which has principally relied on these channels since inception.<\/p>\n<section class=\"marginTopBottom-xl\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl bg-snow display-block\"><span class=\"aspectRatio-content zi-chrome display-block\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Guy.jpg\" title=\"\" alt=\"\" \/><\/span><\/span><span class=\"display-block marginTop-l marginBottom-xl lineHeight-m textAlign-center c-silver fontWeight-3\">I'm just going to leave this here<\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.wired.com\/2012\/12\/ff-robots-will-take-our-jobs\/\" target=\"_blank\" rel=\"noopener noreferrer\">robots are coming<\/a>! Software is going to eat a large majority of non-creative agency roles in the coming years. With great irony, like turkeys selling Thanksgiving, the advertising industry is excitedly pushing the very robots that will ultimately replace them (programmatic anyone?). In the brave new world, bots will communicate with millennials in a \u2018relevant voice\u2019 in their channel of choice about a product\/service they are, according to data, likely to purchase. Dystopia here we come!<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The shift to digital channels has delivered a data-rich world of less imperfect information. So the actual impact of what effectively constitutes shouting into the ether (legacy advertising) can now begin to be measured. TV advertising has long been considered effective, but for how long if it becomes measurable or people are not watching it? As consumption of viewing and advertising moves to the internet, quantifiable data means accountability and judgement. That should scare the hell out of agencies and publishers which have, outside of TV advertising, thus far survived and thrived on at best cloudy metrics.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">For example a display ad is considered as \u2018viewed by the visitor\u2019 if \u201cat least 50% of its pixels were displayed on the visitor\u2019s browser for at least one continuous second\u201d. The bar is clearly low. Kalkis Research recently released an <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/kalkis-research.com\/google-end-of-the-online-advertising-bubble\" target=\"_blank\" rel=\"noopener noreferrer\">End Of The Online Advertising Bubble<\/a> report foreboding a beautifully coined \u201csub-prime crisis\u201d in ad tech. It is well worth a scan. Gabe Leydon, founder of Machine Zone, buys a lot of ads and a lot of TV spots (you know, the ones with Kate Upton and Arnie in them). He gave an epic takedown of the agency\/media industry at code\/media 2016, characterising \u201calmost all brand advertising as nothing more than a slush fund that feeds lazy advertisers, publishers and networks, who want to avoid accountability.\u201d Ouch! It\u2019s a must-watch if you are in the ad or media industry or if you like watching slow motion car crashes (seriously, the Q&amp;A is like a post-coital cigarette... \u201cDesire is an art and advertising is art and science!\u201d someone forlornly pleads).<\/p>\n<section class=\"marginTopBottom-xl\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content zi-chrome display-block\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/05\/Landscape.jpg\" title=\"\" alt=\"\" \/><\/span><\/span><span class=\"display-block marginTop-l marginBottom-xl lineHeight-m textAlign-center c-silver fontWeight-3\">Because Fuck You<\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The era of the Agency of Record and retainers is coming to an end. I have met with many client-side teams and senior business decision makers at leading brands over the last year. I can tell you that the value and returns on comfortable, long-held agency of record relationships are in question. Feeling gauged and exploited, they are also asking the same of the many millions spent on bloated retainers over many years. The age of mega-retainers is coming to an end and the big brands such as <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.adweek.com\/agencyspy\/pepsi-executive-is-not-so-happy-with-his-agencies\/95627\" target=\"_blank\" rel=\"noopener noreferrer\">Pepsi are calling it<\/a>. As a new generation begins to take the helm, brands and clients are seeking out more open relationships than those of the AOR era. That shift presents a significant structural risk to the largest agencies who have grown fat on these arrangements. Everyone will need to figure out an operating model in a post-AOR world.<\/p>\n<blockquote class=\"pageWrap pageWrap--s position-relative marginTopBottom-l breakPointM-marginTopBottom-xl\"><div class=\"blog-quote-before position-absolute bg-marvel\"><\/div><div class=\"tweet-quote blog-quote-after position-absolute bg-marvel cursor-pointer transitionDuration-l transitionProperty-all transitionTimingFunction-cv-easeOutCircular scaleUp--hover zi-weak\"><svg class=\"fill-white opacity-0 pointerEvents-none position-absolute pinCenter transitionProperty-all transitionTimingFunction-easeInOut\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"24\" height=\"20\" viewBox=\"0 0 24 20\"><path d=\"M24,2.37a9.64,9.64,0,0,1-2.83.79A5,5,0,0,0,23.34.37a9.72,9.72,0,0,1-3.13,1.23A4.86,4.86,0,0,0,16.62,0a5,5,0,0,0-4.8,6.2A13.87,13.87,0,0,1,1.67.92,5.13,5.13,0,0,0,3.19,7.67,4.81,4.81,0,0,1,1,7a5,5,0,0,0,3.95,5,4.82,4.82,0,0,1-2.22.09,4.94,4.94,0,0,0,4.6,3.51A9.72,9.72,0,0,1,0,17.73,13.69,13.69,0,0,0,7.55,20c9.14,0,14.31-7.92,14-15A10.17,10.17,0,0,0,24,2.37Z\"\/><\/svg><\/div><p class=\"blog-quote position-relative textAlign-center c-marvel\"><span class=\"blog-quote-text transitionDuration-l transitionProperty-all transitionTimingFunction-easeInOut\">The ad industry has a talent, lifestyle and purpose problem.<\/p><\/span><\/blockquote>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The ad industry has a talent, lifestyle, and purpose problem. Behind the generation of career-coasting marketers maintaining business as usual sits a frustrated, hungry, product focused, and purpose driven generation of progressives. For anyone working in and around agencies and brands those generational fault lines are clear to see. With so many options this talent is not hanging around. Many are emerging from a career-long bout of Stockholm syndrome, the self-justification for the all-hours, all-sacrifice lifestyle of the industry. Some agencies are beginning to act on the damage such as Wieden &amp; Kennedy London <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.campaignlive.com\/article\/wieden-kennedy-trials-limits-working-hours\/1386740\" target=\"_blank\" rel=\"noopener noreferrer\">limits to work hours<\/a> and email curfews for its staff. The fresh young talent that used to fuel agencies is increasingly altogether eschewing the industry <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.nytimes.com\/2016\/04\/19\/business\/media\/ad-agencies-need-young-talent-cue-the-bean-bag-chairs.html\" target=\"_blank\" rel=\"noopener noreferrer\">despite desperate cosmetic makeovers<\/a>.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">It may be a case of too little, too late to change the tide. For more and more the question arises of what\u2019s the point of putting up with all this? Confronted by his mortality following inoperable esophageal cancer, Linds Redding, a New Zealand-based art director who worked at BBDO and Saatchi &amp; Saatchi <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/uk.businessinsider.com\/its-not-worth-it-linds-reddings-short-lesson-in-perspective-2012-11?r=US&IR=T\" target=\"_blank\" rel=\"noopener noreferrer\">put it like this<\/a>:<\/p>\n<section class=\"pageWrap pageWrap--s position-relative marginBottom-l paddingLeft-l paddingTopBottom-xs fontWeight-3 c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl\">\"I think you\u2019re all fucking mad. Deranged. So disengaged from reality it\u2019s not even funny. It\u2019s a fucking TV commercial. Nobody gives a shit.\" &mdash; Linds Redding<span class=\"position-absolute pinTL bg-marvel borderRadius-s\" style=\"width: 3px; bottom: 0\"><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Where once the talent was trickling from the leak in the dike, talent is now flooding out of the industry. Many are finding roles in tech companies with better pay, better conditions, and greater meaning and fulfilment in the work. From the top down, the very people that could save the industry are leaving it. <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/adage.com\/article\/agency-news\/akqa-execs-rei-inamoto-rem-reynolds-open-business-invention-studio\/300619\/\" target=\"_blank\" rel=\"noopener noreferrer\">Rei Inamoto<\/a> leaving AKQA to open a business invention shop or pretty much all the product-focused talent at Huge leaving to set up the product-focused agency <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/work.co\/\" target=\"_blank\" rel=\"noopener noreferrer\">Work &amp; Co<\/a> are two of countless examples. All of the above means that attracting talent, especially engineers, is approaching the impossible.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-none breakPointM-display-block position-relative float-right bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 160px;margin-right: -60px;box-shadow: -12px 12px 0 0 #009EEB;top: -6px;margin-left: 25px;\">The parasite has become the host.<\/span>The script flips further. Tech giants such as Google and Facebook were once simply vendors and channels for the ad industry. However, both are now taking their talent and offering quantifiable performance marketing services directly to their clients. The parasite has become the host.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">There is clearly a real impetus for change and <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/hbr.org\/2013\/03\/what-the-marketing-agency-of-th\" target=\"_blank\" rel=\"noopener noreferrer\">none of this is new<\/a>. Someone should do something right? Unfortunately, the industry suffers from a false sense of security and lack of urgency. This has been fostered by the billions still being generated through a generation or two of marketers who are fully invested in maintaining the status quo (I suspect in order to ride out careers, pensions and mortgages). The fact is that both agency and client side have been complicit in selling and buying things to and from each other that no one cares about because it\u2019s what has always been done.<\/p>\n<section class=\"paddingBottom-s\"><iframe loading=\"lazy\" class=\"display-block marginTopBottom-l centered\" width=\"720\" height=\"405\" src=\"https:\/\/www.youtube.com\/embed\/Xp7VhEy4GHI?rel=0\" frameborder=\"0\" allowfullscreen><\/iframe><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">A macrocosm of exactly this pattern is cloud advertising. Actual human beings give zero fucks about the cloud aka just someone else\u2019s computer. Yet this untargeted, expensive and pointless noise that exactly this generation has sold to each other is plastered absolutely everywhere: TV, online, stations, billboards, outhouses, sporting events, and ensuring utter global inescapability in practically every major airport on the planet. VR is undoubtedly next as the \u201cI need VR\u201d becomes the new \u201cI need an app\u201d and branded VR content from vodka brands floods our consciousness.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The party is not going to end any day soon. But the industry will continue a slow and inevitable march to redundancy unless it responds to the many forces at play. There is another industry that went from nearly $40B a year to under $15B due to failure to grasp digital. This was the global recorded music industry which was <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/qz.com\/383109\/the-music-industry-has-hit-its-rock-bottom\/\" target=\"_blank\" rel=\"noopener noreferrer\">decimated in just over a decade<\/a>.<\/p>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/MusicRevenue.png\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/MusicRevenue.png\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><span class=\"display-block marginTop-m lineHeight-m textAlign-center c-silver fontWeight-3\">Oooooh shit!<\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Digital product work with its margins, purpose, and engagement is one of the paths that could save the industry. With the writing on the wall for so long, why is the ad industry still not in the game?<\/p>\n<section id=\"the-great-pretenders\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The Great Pretenders<\/h1>\n<section class=\"marginTopBottom-xl\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content zi-chrome display-block\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Horse.jpg\" title=\"\" alt=\"\" \/><\/span><\/span><span class=\"display-block marginTop-l marginBottom-xl lineHeight-m textAlign-center c-silver fontWeight-3\">\u201cSorry mate, that\u2019s still a horse\u201d<\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">There was time when the ad industry had influence over more than Promotion, one of the Four Ps in the traditional Four Ps of marketing (Product, Price, Place, and Promotion). Way back in the Mad Men era so celebrated by the modern advertising industry they heavily informed Product. But as their clients in the 70s and 80s established in-house capabilities for those skills (doesn\u2019t that sound familiar!) they were increasingly limited to Promotion. Decades later, the golden opportunity to reclaim the lost P and properly integrate digital product capabilities and culture is being spurned. The focus appears to be on rebranding existing capabilities to posture as business-building product shops, or even somewhat delusionally as startup disruptors...<\/p>\n<div class=\"pageWrap pageWrap--s\">[tweet id=\"705413682394763264\"]<\/div>\n<section class=\"pageWrap pageWrap--s display-block marginBottom-l lineHeight-m textAlign-center c-silver fontWeight-3\" style=\"margin-top: -20px;\">TBWA schedule their April fool\u2019s parody 29 days too early.<\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Scan the positioning, websites, and decks of design, advertising, marketing, and branding agencies and you will see that everyone is now talking about building products and businesses. Old case studies have been repositioned in a new \u2018product\u2019 context. Has everyone transformed themselves into product organisations? No. They\u2019ve mostly painted stripes on their horse to make a zebra. But it\u2019s still a horse. To bastardise <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.facebook.com\/dan.ariely\/posts\/904383595868?imm_mid=0a9701&cmp=em-strata-newsletters-strata-olc-20130529-elist\">Dan Ariely\u2019s<\/a> beautiful Big Data quote, a lot of people are putting on a good show...<\/p>\n<section class=\"pageWrap pageWrap--s position-relative marginBottom-l paddingLeft-l paddingTopBottom-xs fontWeight-3 c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl\">\u201cDigital Product is like teenage sex: everyone talks about it, not many know how to do it, everyone thinks everyone else is doing it, so everyone claims they are doing it...\u201d\u200a&mdash;\u200a(sort of) Dan Ariely<span class=\"position-absolute pinTL bg-marvel borderRadius-s\" style=\"width: 3px; bottom: 0\"><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Ad Holding Group agencies such as BBH, Huge, Rockfish, Wieden &amp; Kennedy &amp; Ogilvy et al have all established innovation \u2018Labs\u2019. Based on evidence that\u2019s yet to be discovered, they have thus far proven to be marketing and client seduction efforts. They have shown little in terms of real world product output... repeat after me \u201cA Digital Product is a software-enabled product or service that offers some form of utility to a human being\u201d. These labs do not reflect a true intent or investment in building a product for the world. The dust-gathering 3D printers, soon to be joined by dust-gathering VR headsets, are symbolic. This wonderful piece on agencies and products from 2012 still stands strong today.<\/p>\n<section class=\"pageWrap pageWrap--s marginBottom-l boxShadow-smoke boxShadow-smoke--xd--hover borderRadius-m transitionDuration-m transitionTimingFunction-ease\"><a class=\"link link--blue fontWeight-4\"class=\"link link--dark fontWeight-3 link--underline\" href=\"http:\/\/digiday.com\/agencies\/why-agencies-cant-create-products\/\" target=\"_blank\" rel=\"noopener noreferrer\"><span class=\"display-block padding-m paddingRight-xl position-relative\"><span class=\"display-block height-100 position-absolute pinTR\"><span class=\"display-table height-100 paddingRight-l\"><span class=\"display-tableCell verticalAlign-middle\"><svg class=\"fill-smoke--d \" xmlns=\"https:\/\/www.w3.org\/2000\/svg\" width=\"34\" height=\"24\" viewBox=\"0 0 34 24\"><path class=\"a\" d=\"M33.78,11.18a2,2,0,0,0-.44-0.74L23.63,0.61a2.09,2.09,0,1,0-3,3L27.05,10H2a2,2,0,1,0,0,4H27l-6.37,6.4a2.09,2.09,0,0,0,3,3l9.78-9.82A2.07,2.07,0,0,0,33.78,11.18Z\"><\/path><\/svg><\/span><\/span><\/span><span class=\"display-block padding-xs paddingRight-m\"><span class=\"marginBottom-xs display-block c-slate lineHeight-l fontSize-l fontWeight-5\">Why Agencies Can\u2019t Create Products<\/span><span class=\"c-silver lineHeight-l fontSize-l fontWeight-3 opacity-80\">No self-respecting \u201cfuture of the agency\u201d panel or article is complete without a detour to product world. This is a mythical place where agencies...<\/span><\/span><\/span><\/a><\/section>\n<blockquote class=\"pageWrap pageWrap--s position-relative marginTopBottom-l breakPointM-marginTopBottom-xl\"><div class=\"blog-quote-before position-absolute bg-marvel\"><\/div><div class=\"tweet-quote blog-quote-after position-absolute bg-marvel cursor-pointer transitionDuration-l transitionProperty-all transitionTimingFunction-cv-easeOutCircular scaleUp--hover zi-weak\"><svg class=\"fill-white opacity-0 pointerEvents-none position-absolute pinCenter transitionProperty-all transitionTimingFunction-easeInOut\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"24\" height=\"20\" viewBox=\"0 0 24 20\"><path d=\"M24,2.37a9.64,9.64,0,0,1-2.83.79A5,5,0,0,0,23.34.37a9.72,9.72,0,0,1-3.13,1.23A4.86,4.86,0,0,0,16.62,0a5,5,0,0,0-4.8,6.2A13.87,13.87,0,0,1,1.67.92,5.13,5.13,0,0,0,3.19,7.67,4.81,4.81,0,0,1,1,7a5,5,0,0,0,3.95,5,4.82,4.82,0,0,1-2.22.09,4.94,4.94,0,0,0,4.6,3.51A9.72,9.72,0,0,1,0,17.73,13.69,13.69,0,0,0,7.55,20c9.14,0,14.31-7.92,14-15A10.17,10.17,0,0,0,24,2.37Z\"\/><\/svg><\/div><p class=\"blog-quote position-relative textAlign-center c-marvel\"><span class=\"blog-quote-text transitionDuration-l transitionProperty-all transitionTimingFunction-easeInOut\">The ad industry is still characterised by a low level of technical competence.<\/p><\/span><\/blockquote>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Despite the many acquisitions of digital shops, the ad industry is still characterised by a low level of technical competence in digital product. It has yet to effectively structurally, or culturally integrate digital within its walls. There are simply so few examples that demonstrate success (before you wheel out RGA and Nike Plus, please... that was launched four James Bonds ago). The industry has struggled to effectively deliver beyond web marketing and e-commerce work into mobile software development. It is hard to see how it will command emerging technologies such as VR or wearable tech let alone complex digital product work.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">This is precisely where the industry\u2019s failure to grapple with digital product work, which commands a much higher premium and margin, will have consequence. If digital advertising and not products and services are to be commoditised and if \u2018<a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.gerrymcgovern.com\/new-thinking\/future-marketing-be-useful\" target=\"_blank\" rel=\"noopener noreferrer\">The future of marketing is to be useful<\/a>\u2019 then there should be no greater impetus for the industry to drive towards the delivery of digital products and services. Brand clients, nearly all of whom are becoming software oriented businesses, will ultimately seek out partners who are able to deliver digital product work. Within the confines of a confine of digital, the ad industry will be left to operate in the low end of the market. It is here that margins and profits will dry up. (Maybe then the focus will shift again on selling brands by making, well... advertising).<\/p>\n<section class=\"big-mask-top width-100 marginBottom-xl\" style=\"background-color: #3AA9C4;\">\n<div class=\"display-block pageWrap pageWrap--m\"><span class=\"breakPointL-display-table paddingTop-xl\"><span class=\"display-block breakPointL-display-tableCell breakPointL-width-50 breakPointL-verticalAlign-bottom\"><span class=\"display-block paddingLeftRight-0 paddingTopBottom-l breakPointM-paddingLeftRight-xl breakPointM-paddingTopBottom-xl \" style=\"margin: 0 auto;\"><span class=\"display-block breakPointL-paddingTop-xl c-white fontSize-xl lineHeight-xl opacity-80\">All in all the evidence points towards an Ad agency having as much experience in building businesses or digital products as chimpanzees do in space travel. Yes, chimpanzees have been in space, but that doesn\u2019t mean you should let them fly the spaceship. So should a startup let themselves be advised by people who have never launched a startup themselves?<\/span><span class=\"marginTop-m display-block c-white fontSize-xxl lineHeight-xxl\">  That\u2019s why tech companies and startups will let ad agencies market their core consumer facing products but won\u2019t let them work on the products themselves.<\/span><\/span><\/span><span class=\"display-block breakPointL-display-tableCell breakPointL-width-50 breakPointL-verticalAlign-bottom\"><span class=\"aspectRatio aspectRatio--100 is-loading is-loading--xl is-loading--white display-block\"><span class=\"aspectRatio-content zi-chrome display-block\"><img decoding=\"async\" class=\"width-100\" src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/05\/Monkey.jpg\" title=\"\" alt=\"\" \/><\/span><\/span><\/span><\/span><\/div>\n<\/section>\n<section class=\"display-block breakPointM-display-none pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">That\u2019s why tech companies and startups will let ad agencies market their core consumer facing products but won\u2019t let them work on the products themselves.<\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Ad Holding Groups have made an art form of establishing relationships with global brands. They have had the ear of the business decision makers more than any other vendor. I would venture that few do it better. However, with every fumbled product initiative another decades-old bridge gets burnt. As George Walker Bush said \u201cFool me once, shame on ... shame on you. Fool me... You can\u2019t get fooled again!\u201d.<\/p>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/F1.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/F1.jpg\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><span class=\"display-block marginTop-m lineHeight-m textAlign-center c-silver fontWeight-3\">Destined to be placing ads on those cool race cars rather than getting to work on them.<\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Clients need to question how honest a partner is incentivised to be if their agency delivers on only one part of the process. If you\u2019re married to only one part of the process, selling purely strategy, design, branding or media, you\u2019re most likely going to make that as big and expensive as you can as that\u2019s how you make money. In contrast, being responsible end-to-end for getting a product to market, promotes honesty and efficiency as you\u2019re invested in the outcome and post-launch iteration.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">It begs the question of whether, like supertankers trying to navigate rapids, the big ad firms are too big to function in the new world of digital product. For the 500-plus person vessels sailing the marketing seas, I am not confident the patient would survive the necessary surgery, nor their holding group masters allow it. But hold tight, we\u2019re not done yet because adding to all of the above, shit just got real...<\/p>\n<section id=\"enter-the-big-five-four\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Enter the Big Five \/ Four<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/NotAboutIdeas.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/NotAboutIdeas.jpg\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Management consultancies have entered the arena through a glut of digital consultancy acquisitions. They have done so for reasons both similar and different to the Ad Holding Groups. They already have C-suite access and accounts from which they are generating tens or hundreds of millions of dollars a year per client. Now they are slip slidin\u2019 along the value chain to sell them more stuff and they have their eye on the Ad Holding Group\u2019s slice of the pie.<\/p>\n<section class=\"pageWrap pageWrap--s position-relative marginBottom-l paddingLeft-l paddingTopBottom-xs fontWeight-3 c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl\">\u201cIt\u2019s not about ideas, it\u2019s about making ideas happen\u201d &mdash;\u200aScott Belsky<span class=\"position-absolute pinTL bg-marvel borderRadius-s\" style=\"width: 3px; bottom: 0\"><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">They are also responding to market demand. Much as visions of 2030 spur the imagination and inform strategy, they don\u2019t impact more immediate business cycles. Increasingly their clients (and the world) are slowly edging away from buying ideas in multi-million dollar, 300-page powerpoint decks towards actually making ideas happen. In the same vein that the value of AOR and retainer relationships are being questioned by clients, the same is being asked of the strategic engagements of management consultancies. Their clients have become increasingly focused on a meaningful and actionable return on their not inconsiderable investment.<\/p>\n<blockquote class=\"pageWrap pageWrap--s position-relative marginTopBottom-l breakPointM-marginTopBottom-xl\"><div class=\"blog-quote-before position-absolute bg-marvel\"><\/div><div class=\"tweet-quote blog-quote-after position-absolute bg-marvel cursor-pointer transitionDuration-l transitionProperty-all transitionTimingFunction-cv-easeOutCircular scaleUp--hover zi-weak\"><svg class=\"fill-white opacity-0 pointerEvents-none position-absolute pinCenter transitionProperty-all transitionTimingFunction-easeInOut\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"24\" height=\"20\" viewBox=\"0 0 24 20\"><path d=\"M24,2.37a9.64,9.64,0,0,1-2.83.79A5,5,0,0,0,23.34.37a9.72,9.72,0,0,1-3.13,1.23A4.86,4.86,0,0,0,16.62,0a5,5,0,0,0-4.8,6.2A13.87,13.87,0,0,1,1.67.92,5.13,5.13,0,0,0,3.19,7.67,4.81,4.81,0,0,1,1,7a5,5,0,0,0,3.95,5,4.82,4.82,0,0,1-2.22.09,4.94,4.94,0,0,0,4.6,3.51A9.72,9.72,0,0,1,0,17.73,13.69,13.69,0,0,0,7.55,20c9.14,0,14.31-7.92,14-15A10.17,10.17,0,0,0,24,2.37Z\"\/><\/svg><\/div><p class=\"blog-quote position-relative textAlign-center c-marvel\"><span class=\"blog-quote-text transitionDuration-l transitionProperty-all transitionTimingFunction-easeInOut\">\u201cManagement consultancy... The art of stealing someone\u2019s pocket watch and telling them the time\u201d &mdash;\u200aAnonymous<\/p><\/span><\/blockquote>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">A broadening of services from idea to encompass execution was required. By \u2018buying\u2019 design, management consultancies could now sell \u2018design\u2019 through their newly minted, execution focused storefronts; McKinsey Digital Labs \/ Accenture Interactive \/ Deloitte Digital \/ Capgemini Digital Customer Experience \/ IBM iX etc. They have ready buyers in existing clients, whose businesses are becoming digitised and running on software.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Now they have creative credibility by acquisition, digital chops, and a new and very large product and service design banner to wave to their clients. Something we need to see play out, given the sheer size of these client accounts, is whether design and digital product delivery will be central to or an afterthought in their relationship with the client. This will have a telling impact on the environment in which that work is carried out.<\/p>\n<section class=\"position-relative position-relative marginTop-xl paddingTop-m\"><span class=\"display-block position-absolute pinTL zi-negative\"><img class=\"b-lazy width-100 height-auto\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Clash.jpg\" title=\"\" alt=\"\" \/><\/span><\/section>\n<section id=\"clash-of-the-titans\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Clash of the Titans<\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-block paddingRight-xl\"><span class=\"display-block breakPointM-paddingRight-xl\"><span class=\"display-block breakPointM-paddingRight-xl\"><span class=\"display-block breakPointM-paddingRight-xl\">All of this has the behemoths colliding. The old school T-Rex Ad Holding Firms are now <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/digiday.com\/agencies\/inside-deloitte-1-5-billion-ad-agency\/\">fighting over prey<\/a> with the genetically engineered I-Rex management consultancy design groups (sincere apologies if you haven\u2019t seen Jurassic World). Let\u2019s take a look at the 2015 revenues of the big management consultancies versus the Ad Holding Groups:<\/span><\/span><\/span><\/span><\/p>\n<section class=\"pageWrap pageWrap--s marginBottom-l\">\n<div class=\"grid grid--1 breakPointM-grid--2\">\n<div class=\"marginBottom-l breakPointM-marginBottom-0\">\n<div class=\"marginBottom-m c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-5\">Management consultancies:<\/div>\n<dl class=\"marginLeft-l\">\n<li class=\"marginBottom-s c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3\">IBM: <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">$81.7B<\/strong><\/li>\n<li class=\"marginBottom-s c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3\">Deloitte Consulting: <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">$35.2B<\/strong><\/li>\n<li class=\"marginBottom-s c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3\">Accenture: <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">$31.0B<\/strong><\/li>\n<li class=\"marginBottom-s c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3\">Capgemini: <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">$13.2B<\/strong> <sup class=\"fontWeight-5\">*<\/sup><\/li>\n<li class=\"c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3\">McKinsey: <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">$8.3B (2014)<\/strong><\/li>\n<\/dl><\/div>\n<div>\n<div class=\"marginBottom-m c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-5\">Ad Holding Groups:<\/div>\n<dl class=\"marginLeft-l\">\n<li class=\"marginBottom-s c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3\">WPP: <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">$17.5B<\/strong> <sup class=\"fontWeight-5\">*<\/sup><\/li>\n<li class=\"marginBottom-s c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3\">Omnicom: <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">$15.1B<\/strong><\/li>\n<li class=\"marginBottom-s c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3\">Publicis Groupe: <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">$10.7B<\/strong> <sup class=\"fontWeight-5\">*<\/sup><\/li>\n<li class=\"c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3\">IPG: <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">$7.6B<\/strong><\/li>\n<\/dl><\/div>\n<\/p><\/div>\n<\/section>\n<section class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 opacity-60\"><sup class=\"fontWeight-5\">*<\/sup> Revenues crudely adjusted to USD from their reported local currency<\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Make no mistake these are absolutely giant companies fighting it out and the battle will be epic!<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><svg class=\"centered display-block marginTopBottom-xl fill-slate\" width=\"64\" height=\"8\" viewBox=\"0 0 64 8\"><path d=\"M4 8c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4z\" \/><\/svg><\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">The impact of these seismic shifts in the industry are yet to fully play out. Will the management consultancies entering the market be able to escape the forces plaguing the Ad Holding Groups? Will either be able to shape compelling and sustainable digital product propositions for their clients\u200a\u2014\u200athe ability to \u2018actually make ideas happen\u2019? Will they be able to hold onto the talent they have gathered up via expensive acquisitions?<\/span><\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">The answers to those questions we will only know a few years down the line. But right here right now amidst the fray, independent digital consultancies, mere pissants when you consider the numbers above, are a hot commodity. At the same time \u2018design as a service\u2019 is by all accounts in critical condition. So next we\u2019re going to zoom in on the little guys amongst all this madness and explore what\u2019s going to be left when the smoke clears.<\/span><\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><svg class=\"centered display-block marginTop-xl fill-slate\" width=\"64\" height=\"8\" viewBox=\"0 0 64 8\"><path d=\"M4 8c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4z\" \/><\/svg><\/p>\n<section id=\"chapter-two-agency-perspective\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\"><span class=\"marginTop-xl display-block c-slate fontSize-xxl lineHeight-xxl breakPointM-fontSize-xxxl breakPointM-lineHeight-xxxl breakPointL-fontSize-xxxxl breakPointL-lineHeight-xxxxl fontWeight-5\">Chapter II: Agency Perspective<\/span><\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-block paddingBottom-xl c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">In chapter I we focused on the digital industry at a tumultuous macro level. This sets valuable context in which to explore the situation at the consultancy and agency level that many of us call home. In this red hot market, agency valuations have never been higher. But the truth is that selling is the death of the company you know whilst the buyer ends up with a mere facsimile of what they paid good money for. Despite the consolidation and growing trend of in-house teams, there will always be a market for great consultancies as long as they are prepared for a new reality. So get ready for the second coming of the independent studio.<\/span><\/p>\n<section class=\"mask-bottom width-100 marginTop-xl\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content zi-chrome display-block\"><img class=\"b-lazy width-100 height-auto\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/777.jpg\" title=\"\" alt=\"\" \/><\/span><\/span><\/section>\n<section id=\"jackpot\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Jackpot!<\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">CONGRATULATIONS!!! Your firm with a global footprint and a few hundred staff, which would have fetched upwards of $75M USD in 2013, will now command closer to $100M in 2016. There is no better time than now to sell your agency with so many well heeled suitors. In fact the market is so hot right now that agencies are being sold based on multiples of between 3x, 4x and in some cases even 5x revenue (not EBIT). Factors such as size, numbers of studios in key markets and client list dictate where in that threshold you sit. Here you go, dream a little...<\/p>\n<section class=\"pageWrap pageWrap--m marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Valuations.png\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Valuations.png\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><\/section>\n<section id=\"buyer-and-seller-beware\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Buyer (and seller) Beware!<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--100 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Ladies.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Ladies.jpg\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Selling one\u2019s company is of course completely OK and is any owner\u2019s right. The true motivation for a large majority of the aforementioned deals is no-doubt cashing out with retirement on the far horizon. When confronted by the reality of a repetitive Greek tragedy of a professional life in its closing cycles, a handsome offer for one\u2019s life\u2019s work is surely hard to resist. Certainly, scanning the Microsoft Word acquisition template press releases... \u201cwider, scale, expand, access, yada yada yada\u201d from the range of the companies who have sold in the last few years it is hard to discern any authentic non-financial motives (of course money is never mentioned).<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">All good right? Except the vision they sold to their people along the journey certainly didn\u2019t include being sold. Despite their declarations, they did not start out in the design industry dreaming of selling to a management consultancy, a global accounting firm, or a credit card company. They know it and their people know it. As such telling the world and more crucially their people how great this is going to be for \u2018us\u2019 is not all good.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Adaptive Path gave an incredulous spiel <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/techcrunch.com\/2014\/10\/02\/adaptive-path-acquired-by-capital-one\/\" target=\"_blank\" rel=\"noopener noreferrer\">following their sale<\/a> to the credit card company Capital One, declaring \u201cIt kind of feels like where we were headed all along.\u201d 19 months on it would be interesting to see how many of those souls are still vibrating.<\/p>\n<div class=\"pageWrap pageWrap--s\">[tweet id=\"517815071322279936\" conversation=\"false\"]<\/div>\n<section id=\"keeping-it-real\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Keeping It Real<\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">I\u2019d personally love to read a from-the-heart announcement...<\/p>\n<section class=\"pageWrap pageWrap--s position-relative marginBottom-l paddingLeft-l paddingTopBottom-xs fontWeight-3 c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl\">\u201cHey folks, As many of you will be aware someone came in with a great offer for our life\u2019s work. We reflected long and hard and came to the conclusion that this is the right time, that we\u2019ve taken this thing as far as it can go. We fought for the best possible deal for our people, so if most of us stick it out and get stuck in for a few years everyone will be looked after (and to be transparent we will maintain our earn out). Things are going to be different moving forwards. It will become something new. So we\u2019d like to acknowledge and celebrate the end of an era and all the hard work you put into making this happen. Let\u2019s accept it for what it is, make the best of it and all earn our keep as we ride this one out.\u201d\u200a<br \/> &mdash;\u200asaid no one. ever.<span class=\"position-absolute pinTL bg-marvel borderRadius-s\" style=\"width: 3px; bottom: 0\"><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Teehan+Lax went well beyond this standard <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.teehanlax.com\/story\/our-next-act\/\">not just in word<\/a> but also in action by opting for a dignified dissolution of the company rather than a sale. The partners and the employees that would and could moved on to Facebook. This path uniquely preserved the T+L legacy. Exhibiting great self-awareness and honesty, they spoke of failing to break their cycle...<\/p>\n<section class=\"pageWrap pageWrap--s position-relative marginBottom-l paddingLeft-l paddingTopBottom-xs fontWeight-3 c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl\">\u201cIf Teehan+Lax was to be successful going forward, we would need to find, what Geoffrey Moore calls, <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.amazon.ca\/Escape-Velocity-Free-Companys-Future\/dp\/0062040898\/179-8999422-9603363?ie=UTF8&*Version*=1&*entries*=0\" target=\"_blank\" rel=\"noopener noreferrer\">Escape Velocity<\/a>. Escape Velocity is the work and investment required for established companies to break patterns in their business to find new levels of growth and sustainability.\u201d &mdash; T+L 2014<span class=\"position-absolute pinTL bg-marvel borderRadius-s\" style=\"width: 3px; bottom: 0\"><\/span><\/section>\n<section id=\"agencies-scattered-on-dawns-highway-bleeding\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Agencies Scattered On Dawn\u2019s Highway Bleeding<\/h1>\n<section class=\"marginTopBottom-xl\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content zi-chrome display-block\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Dead.jpg\" title=\"\" alt=\"\" \/><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The truth Teehan+Lax recognised is that selling your agency is unequivocally the end for the company you knew. You are no longer master of your own destiny. It\u2019s death by spreadsheet. Once assimilated, your company is now a cell in another company\u2019s spreadsheet in which there are no columns for culture. Most crucially the collective spell, which kept the talent that makes up the sum of the parts doggedly committed to the cause beyond all reason through hell and back, is broken. You\u2019re culturally holed below the waterline. If the agency is lucky they will feature in the following well worn conversation for a generation or two before being forgotten.<\/p>\n<section class=\"pageWrap pageWrap--s position-relative marginBottom-l paddingLeft-l paddingTopBottom-xs fontWeight-3 c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl\"><span class=\"display-block marginBottom-m\">A: \"do you remember &lt;insert agency name&gt;?\"<\/span>B: \u201cyeah, they were great weren\u2019t they. What happened to them?\u201d. <span class=\"position-absolute pinTL bg-marvel borderRadius-s\" style=\"width: 3px; bottom: 0\"><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The tragic thing about the denial, the self-delusion or worse the outright lie to your people\u200a\u2014\u200atelling them that selling is not the end but the great next step in the journey\u200a\u2014\u200ais that no one gets a closure experience. When someone dies you hold a funeral or a wake for people to come together. They mark the occasion, reflect, cry, laugh, celebrate, and commiserate. It is a fundamental human need that allows us to honor what has been and begin the process of moving forward properly. I suspect the Teehan+Lax closing party was just that and the bond between their family, wherever they scatter, will consequently endure.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">By not marking the end of what things were, the passing of an era, the company slowly dies. The earnout incentive and timeline is to all intents and purposes a march towards a desert mirage. One by one the people, its very life force, fall away as does its legacy. The founder of Fjord, who sold to Accenture in 2013, recently wrote an article on <span class=\"display-none breakPointM-display-block position-relative float-left bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTop-m marginBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 340px;margin-left: -60px;box-shadow: -12px 12px 0 0 #009EEB;top: -6px;margin-right: 25px;\">If a company is its people, then what\u2019s the point if virtually no one you took the journey with arrives at the destination with you?<\/span>\u2018<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.fastcodesign.com\/3057878\/can-corporate-and-creative-cultures-ever-truly-merge\" target=\"_blank\" rel=\"noopener noreferrer\">Can Corporate and And Creative Cultures Ever Truly Merge?<\/a>\u2019. It speaks of protecting culture, open-space studios and design methodologies in a sale, yet is tellingly thin on the protection of its people. If a company is its people, then what\u2019s the point if virtually no one you took the journey with arrives at the destination with you? It\u2019s like scoring the Presidential suite at the Bellagio... on your own. It has to feel somehow empty.<\/p>\n<section class=\"marginTopBottom-xl\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content zi-chrome display-block\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Zombies.jpg\" title=\"\" alt=\"\" \/><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">We\u2019ve seen death by acquisition over and over. You\u2019ll see nearly all the companies who have sold in the shopping list at the top of this piece wrestle with their predicament, bleed talent, fade, and end up as zombies\u200a&mdash;\u200amere facsimiles of their former selves.<\/p>\n<section id=\"ship-of-theseus\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Ship of Theseus<\/h1>\n<section><iframe loading=\"lazy\" class=\"display-block marginTopBottom-l centered\" width=\"720\" height=\"405\" src=\"https:\/\/www.youtube.com\/embed\/BUl6PooveJE?rel=0\" frameborder=\"0\" allowfullscreen><\/iframe><span class=\"display-block marginBottom-xl lineHeight-m textAlign-center c-silver fontWeight-3\">\"This old brooms had 17 new heads and 14 new handles in its time\"\u200a&mdash;\u200aTrigger<\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">What will all the Ad Holding Firms and management consultancies end up with from their shopping spree a few years down the line? If an agency is acquired and 70+% of the people, the very soul of that company, leave in the months and years that follow, does the buyer actually end up with what they paid for? It\u2019s a brain teaser Greek philosophers (See \u2018<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/en.wikipedia.org\/wiki\/Ship_of_Theseus\" target=\"_blank\" rel=\"noopener noreferrer\">Ship of Theseus<\/a>\u2019) and cockneys have wrestled with over millennia.<\/p>\n<section id=\"the-end-of-consultancy\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The End Of Consultancy<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--100 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Funeral.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Funeral.jpg\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">There has been a great deal of noise made about <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.fastcodesign.com\/3048192\/why-are-design-firms-stagnating\" target=\"_blank\" rel=\"noopener noreferrer\">design firms stagnating<\/a> and the <span class=\"display-none breakPointM-display-block position-relative float-left bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTop-m marginBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 210px;margin-left: -60px;box-shadow: -12px 12px 0 0 #009EEB;top: -6px;margin-right: 25px;\">Don\u2019t panic. We\u2019re not seeing the end of design as a service.<\/span> <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.wired.com\/2014\/12\/disappearing-business-of-design\/\" target=\"_blank\" rel=\"noopener noreferrer\">disappearing business of design<\/a>. This has been driven by the sales and consolidation, the growing trend of internal design departments, and a few prominent shops shuttering studios\u200a\u2014\u200asuch as Smart Design\u2019s SF studio, more due to shifting strategic focus than P&L. Don\u2019t panic. We\u2019re not seeing the end of design as a service. The underlying business model of design as a service remains strong and will continue to exist for many reasons:<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">There are more projects than there are good teams. Consequently, there will always be work for companies that do good work. If you do shit work you\u2019re going to get less work and attract shit projects (i.e. you\u2019re done for). If you do great work you are more likely to get more work and attract great projects. It\u2019s a rather obvious virtuous circle many agencies don\u2019t seem to appreciate.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Any client, be it a startup or global brand, is hedging risk when they work with a consultancy. The cost of failure to meet market, board, or investor expectations around a critical product release heavily outweighs the comparatively high premium of retaining a consultancy. Many clients simply neither have the skills or talent in house or the permission or affordance to build a team. They therefore need to work with consultancy partners to deliver.<\/p>\n<section class=\"pageWrap pageWrap--s marginBottom-l paddingBottom-s c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl fontWeight-3 cf\">Even for brands with internal design departments the field is rife for collaboration and opportunity for consultancy. The inescapable goldfish bowl existence of in-house team robs a company of vital perspective, <img class=\"b-lazy display-none breakPointM-display-block float-right marginTop-m marginLeft-l\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/LetsDoThis.gif\" width=\"240\" height=\"310\" title=\"\" alt=\"\" \/> with the outside world turning exponentially faster than their own. The banking sector is especially affected with regard to product development lifecycles that run in years rather than months. Vital outside market perspective and agility are the panacea that the digital consultancy can offer. Health warning: for the uninitiated studio, the inertia of diving into work with a big organisation can be all like...<\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Whether in-house or in a consultancy, building and running high performing design and engineering teams is extremely difficult. Really! That shit is super fucking hard. You could hand pick a team made up of the very best players from any league of any sport and still have a team that stinks compared to a cohesive, well-drilled team. On top of that, achieving a truly product oriented \u2018one team\u2019 approach with tightly integrated designers and engineers is even harder. (Any team that has engineering on different floors, buildings, states or even countries to design is building weakness into the system). All the money in the world cannot buy getting that right and there are innumerable dysfunctional in-house and agency teams that stand testament to that.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">So if a consultancy can offer the above, something that even some of the world\u2019s wealthiest companies can not pull off, then you\u2019re going to get business even if there are internal design departments in place. Design as service is far from dead.<\/p>\n<blockquote class=\"pageWrap pageWrap--s position-relative marginTopBottom-l breakPointM-marginTopBottom-xl\"><div class=\"blog-quote-before position-absolute bg-marvel\"><\/div><div class=\"tweet-quote blog-quote-after position-absolute bg-marvel cursor-pointer transitionDuration-l transitionProperty-all transitionTimingFunction-cv-easeOutCircular scaleUp--hover zi-weak\"><svg class=\"fill-white opacity-0 pointerEvents-none position-absolute pinCenter transitionProperty-all transitionTimingFunction-easeInOut\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"24\" height=\"20\" viewBox=\"0 0 24 20\"><path d=\"M24,2.37a9.64,9.64,0,0,1-2.83.79A5,5,0,0,0,23.34.37a9.72,9.72,0,0,1-3.13,1.23A4.86,4.86,0,0,0,16.62,0a5,5,0,0,0-4.8,6.2A13.87,13.87,0,0,1,1.67.92,5.13,5.13,0,0,0,3.19,7.67,4.81,4.81,0,0,1,1,7a5,5,0,0,0,3.95,5,4.82,4.82,0,0,1-2.22.09,4.94,4.94,0,0,0,4.6,3.51A9.72,9.72,0,0,1,0,17.73,13.69,13.69,0,0,0,7.55,20c9.14,0,14.31-7.92,14-15A10.17,10.17,0,0,0,24,2.37Z\"\/><\/svg><\/div><p class=\"blog-quote position-relative textAlign-center c-marvel\"><span class=\"blog-quote-text transitionDuration-l transitionProperty-all transitionTimingFunction-easeInOut\">The real challenge is to evolve, do it all better: to deliver the irresistible package.<\/p><\/span><\/blockquote>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">When Teehan+Lax referred to Escape Velocity, a failure to break the cycle to achieve the next evolutionary step for their company, they brought the true challenge for the studio model into sharp focus. How do you achieve orbit in your business if you don\u2019t want to sell? The real challenge is to evolve, do it all better: capabilities, product development, collaboration, process, and culture, to deliver the irresistible package. We\u2019re set for a second wave of new independent agencies that will aim for just that under the product studio model.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">But before we go there, we interrupt this transmission for an important message...<\/p>\n<section id=\"the-designers-delusion\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The Designer\u2019s Delusion<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--100 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/PSA.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw==data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/PSA.jpg\" title=\"\" alt=\"\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The design industry has had its ego stroked hard over the last few years. This has resulted in what I refer to as the \u2018designer\u2019s delusion\u2019\u200a\u2014\u200athe naivety and arrogance to think that an industry can be disrupted simply by making an app. That beautiful material design EMR alone is not going to \u2018disrupt healthcare\u2019 because it is only one tiny piece of the gargantuan effort required to even make a dent. For some perspective, beyond pixels that effort can involve lobbying government and taking cities to court.<\/p>\n<div class=\"pageWrap pageWrap--s\">[tweet id=\"709853249407361024\"]<\/div>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The design industry has been guilty of self-indulgent navel gazing, debating the difference between UI and UX, chin stroking on \u2018design thinking\u2019 or trying to capture the essence of what \u2018Design is...\u2019 in 140 characters. Muscles have atrophied from years of consultancy work for giant organisations with five floors of lawyers (NO you cannot spend eight weeks on registration flow!). Every day that we continue to pontificate and indulge in the abstract a dangerous gap widens between us and startupland and techworld where time and methods relentlessly accelerate. It\u2019s time to speak like humans, get grounded and get real.<\/p>\n<div class=\"pageWrap pageWrap--s\">[tweet id=\"710555007989383168\" conversation=\"false\"]<\/div>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">It is vital that designers be equipped for this \u2018real\u2019 world. When a board is reaming you over volume of users, user retention and revenue models, that storytelling campfire bullshit doesn\u2019t cut the mustard. In this world the hierarchical setups, rigid process and stratified walls between disciplines are falling away. Interaction design, visual design, service design, design research et al are all origin stories for the new breed of Product Designer who is honing her multi-disciplinary skills and studying data, business, and technology to move up the value chain with authority.<\/p>\n<section id=\"the-second-coming\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The Second Coming<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/05\/Dandelion.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/05\/Dandelion.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Anyway... Many decades old studios have disappeared. But whilst we\u2019re undoubtedly experiencing a contraction in the number of independent consultancies, we are far from the end of times. The talent has been assimilated into ad group holding companies, management consultancies, and startups over the last several years.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The question is whether they can retain the talent. Unless these environments prove to truly satisfy they will not be able to. Designers and engineers are are idealistic folk who want to make things that count. As long as they can afford to be idealistic, they will ultimately place what they are putting into the world above the money they are taking from it. They also fear stagnation. Their inner voice constantly seeks purpose and in time it almost always wins. That reality has been manifesting itself in the talent drain from the advertising and marketing industry over the last five years.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">By way of acquisition, the management consultancy industry has swept up a lot of the talent. We\u2019re still to see how it\u2019s going to play out in that domain. Doing great product work within the confines of the management consultancy industry presents its own challenges.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">It is a deeply political environment that requires a massive operational overhead just to be able to do your job. This is a million miles from lean and agile and it places a heavy burden on individuals and teams. We\u2019ve yet to see whether design is viewed as a core or bolt on client offering by the consultants who rule their client fiefdoms. This will dictate the level of stakeholder access that teams will be able to secure and in turn the quality of collaboration and of the end-product. If a high percentage of the work is on projects that do not see the light of day, working in abstract, then this will erode the talent\u2019s interest. How will the culture clash play out between the tattooed \u2018design guys\u2019 who are rolled out by the pressed pants \u2018consultant crew\u2019 to \u2018do\u2019 some design. Grab your popcorn folks!<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">As for the owners and the most senior talent from companies acquired by Ad Holding companies and management consultancies? The majority of those companies will kick their final cultural death throes in the coming years and, with earn outs complete, those people will want out. The inner voice just has a little more resistance to overcome. These are exactly the kinds of people inclined to start new consultancies, kickstarting the second wave of the independent studio.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The intoxicating allure of the startup world has attracted so many designers and engineers in the last decade. However, <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/heidiroizen.tumblr.com\/post\/139377970205\/dear-startups-heres-how-to-stay-alive\" target=\"_blank\" rel=\"noopener noreferrer\">markets are correcting their inflated valuations<\/a> of tech stocks and <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.wsj.com\/articles\/this-tech-bubble-is-bursting-1462161662\" target=\"_blank\" rel=\"noopener noreferrer\">the funding for startups is drying up<\/a>. As that reality bites, the talent is sobering up. Everyone is realising that the gold in them there hills is just as hard to mine as it is anywhere else. There are no sure things\u200a\u2014\u200athe laws of nature ultimately apply to a tech startup just as much as they do to other companies. We are going to see more horror stories about long-term employees with common stock getting burnt in the coming months and years due to the ratchets and liquidity preferences for investors built into new rounds of financing. The case of the unicorn <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.nytimes.com\/2015\/12\/27\/technology\/when-a-unicorn-start-up-stumbles-its-employees-get-hurt.html\" target=\"_blank\" rel=\"noopener noreferrer\">Good Technology opting to sell to Blackberry<\/a> rather than for an IPO is a cautionary tale for those who opt for stock over salary.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">I am not saying that any of these silos for talent are better or worse than the other, except for advertising in its current state. They each present their own challenges and the talent is increasingly sober to that and evaluating options between them all.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-none breakPointM-display-block position-relative float-left bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTop-xxs marginBottom-m borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 340px;margin-left: -110px;box-shadow: -12px 12px 0 0 #009EEB;top: 14px;margin-right: 25px;\">By 2018 the second coming of the independent studio will be in full force as waves of designers and engineers leave ad land, management consultancy, and startups to start or join new digital consultancies.<\/span>In the coming years a LOT of the talent that has been holed up will blow like dandelion seeds in a fresh spring breeze. By 2018 the second coming of the independent studio will be in full force as waves of designers and engineers leave ad land, management consultancy, and startups to start or join new digital consultancies. A thriving new independent agency community will emerge with a sharper focus to their work, resolved to do things differently under a new and progressive business model.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><svg class=\"centered display-block marginTopBottom-xl fill-slate\" width=\"64\" height=\"8\" viewBox=\"0 0 64 8\"><path d=\"M4 8c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4z\" \/><\/svg><\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-block paddingBottom-xl c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">A great majority of the industry\u2019s agencies and talent has been churned by the strategic expansion of Ad Holding Groups and management consultancies. But from the carnage and fallout a new and evolved breed of digital agency will emerge that understands and engages with the new world and seizes upon the opening in the market.<\/span><\/p>\n<section><svg class=\"centered display-block marginTopBottom-xl fill-slate\" width=\"64\" height=\"8\" viewBox=\"0 0 64 8\"><path d=\"M4 8c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4z\" \/><\/svg><\/section>\n<section id=\"chapter-three-new-perspective\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\"><span class=\"marginTop-xl display-block c-slate fontSize-xxl lineHeight-xxl breakPointM-fontSize-xxxl breakPointM-lineHeight-xxxl breakPointL-fontSize-xxxxl breakPointL-lineHeight-xxxxl fontWeight-5\">Chapter III: New Perspective<\/span><\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-block paddingBottom-xl c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">In chapter I and II we explored current digital industry and agency perspectives and the quandary which talent finds itself in. We\u2019ve also heralded the second coming of a new breed of studio. Iterating on the old agency model is vital or you\u2019ll be condemned to repeat history. The evolutionary avenues are already being explored by the startup studio, as well as by progressive agencies engaged in venture and own product initiatives. But you need to approach the game wisely or you could lose it all!<\/span><\/p>\n<section id=\"cracking-the-code\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Cracking The Code<\/h1>\n<section class=\"pageWrap pageWrap--m marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Code.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Code.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The digital consultancy business is a game of highs and lows. There is adventure, friends, fun, creativity, and plenty of variety as you get to work on a range of problems in a diverse range of industries. Rock \u2018n\u2019 roll!<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">But it can also be a complete pain in the arse. You live and die by the whim of clients, budgets, and the economy\u200a&mdash;\u200aoh the uncertainty. The outlook can go from 72 and sunny to end-of-days and back again within the course of a month. Your services suffer an endless and increasingly faster downward spiral of commoditisation. In the typical vendor-client relationship shit flows downhill right where you are standing with the shovel. The work can at times seem pointless and unmotivating. The hours can be insane and crap all over your work life balance. The bigger the company gets the more furiously everyone has to scramble. It relies on humans who have needs, feelings, and emotions\u200a&mdash;\u200aunhelpfully, all kinds of different ones at different times &mdash; that need to be considered and cared for. Then after putting up with all that, one day the company you work for gets sold to a credit card company, or as an owner, you get sick of the life and sell to one. All of that can mean it\u2019s not much fun at the bottom, middle or top of the pile in the consultancy game, whatever the payoff.<\/p>\n<section id=\"hamster-wheel-or-rocket-ship\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Hamster Wheel or Rocket Ship?<\/h1>\n<section class=\"pageWrap pageWrap--s marginBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Hamsters.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Hamsters.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Whether you\u2019re considering starting a new consultancy or pivoting an existing business, you have a fundamental decision to make. Do you want to build A: a giant fucking hamster wheel or B: a rocket ship and explore the galaxy.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The hamster wheel represents the consultancy business as usual. It\u2019s a model that relies on a linear relationship between effort and revenue; you sell your consultancy services on the basis of units of time. To make more money you need to make the hamster wheel bigger. To get to \u2018bigger\u2019 and maintain it, everyone including you needs to run furiously faster. When they are sleeping the company does not make money. Those incidentally are the conditions in which an owner is more likely to get tired and sell and those in which employees are going to disengage. Does anyone who has the choice really want to live that life again?<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">A 500 or 1,000 person marketing agency for example is a giant hamster wheel. I bet most people in them from early on are bewildered with what it has all become. In this age it is evolve or die for the consultancy model. But at that size all your vital organs rely on the dying model of marketing work. You may not survive the surgery required for the transformation.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">There has to be a better way. I\u2019ve referred a lot to escape velocity, breaking patterns, evolution, doing things differently and hinted at the need for a new and progressive business model. How can we change our fate, compensate for uncertainty and take control of our destiny?<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">In what direction can we diversify in order to escape the apparent laws of nature of the consultancy ecosystem? For some inspiration for what the rocket ships could look like it\u2019s well worth looking at the emerging startup studio model and some of the venture and own product plays that progressive digital studios have been making in the last few years.<\/p>\n<section id=\"the-startup-studio\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The Startup Studio<\/h1>\n<section class=\"pageWrap pageWrap--s marginBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Rocket.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Rocket.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The startup studio is a relatively new model of company that\u2019s focused on developing tech startups internally. They keep their fledglings warm, fed, and safe until they are ready to fly the nest. Not exactly a fund or a typical incubator, they might develop their own startup, back a founder or buy a company\u200a\u2014\u200aall the while nestling them in their warm ample bosom.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">New York\u2019s <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/betaworks.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Betaworks<\/a><\/strong> are arguably the baby daddy of the model. They acquired and revived digg and bitly, gave birth to Giphy ($55 Million Series C At A $300 Million Post-Money Valuation), Dots (spun out with a $10 million Series A round from Tencent) and Poncho ($2M seed round hot off the press). One way in which they seed new startups is by backing founders through a Hackers in Residence program that brings in and enables talent. Whilst they are not a fund, they do make small seed investments of between $100k to $200k in companies that they \u2018think will make our network stronger\u2019. The crew over at Betaworks shared the content of their <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/medium.com\/in-beta\/investing-at-betaworks-3b16f1a2ecf8#.j1sde3hmi\" target=\"_blank\" rel=\"noopener noreferrer\">2015 shareholder book<\/a>, which gives you a great insight into the setup and philosophy. They are super hooked up in the fund and the startup community, which gives them strong deal flow and access to investors.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Other notable startup studios include New York and San Francisco based <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/expa.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Expa<\/a><\/strong>. Their focus is to \u2018partner with founders to create new products and services\u2019. They create the environment to help them scale as independent companies through shared services (back office) and resources (space). That allows the startup\u2019s team to focus on product and business. We\u2019ve yet to see how their piglets Kit, Reserve and Drip will fare in the world. Expa recently <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/expa.com\/news\/100m_labs\/\" target=\"_blank\" rel=\"noopener noreferrer\">raised $100m in funding<\/a> and took a step into the incubator space by launching <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/expa.com\/labs\/\" target=\"_blank\" rel=\"noopener noreferrer\">Expa Labs<\/a> to incubate early stage companies with $500k of seed funding and 6 months of office space. The CEO and founder is Garrett Camp, co-founder of Uber and StumbleUpon. They have also attracted partners such as Foursquare co-founder Naveen Selvadurai. They have an absurdly strong network and access to money and investors.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.science-inc.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Science<\/a><\/strong>, based in Santa Monica in LA, is another player focused on internal investments and partnerships. They incubate by \u2018developing a thesis, testing the concept, and then bringing in like-minded talent to help execute and scale.\u2019 as well as make minority investments. They had early success leveraging their toolset with Dollar Shave Club (raising $50 Million Series C round in September 2014, now serving 8.8% of the US men\u2019s cartridge market with over a million members) and DogVacay (raising a $25 million Series B round in November 2014). They\u2019ve put a lot of chips on the table over the last few years and have yet to see a significant exit that would replenish the coffers and prove the model works.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The startup studio model is still relatively new. The barriers to entry to creating a startup such as space, tech, and operations are becoming lower each year. So the startup studio arguably becomes a less compelling and unique proposition for startups. Whether for evolutionary or reactive reasons the leaders in the space are continuously revising their approach and offering. Money and network alone are not enough to guarantee success. Nevertheless the startup studio highlights an opportunity in and around the early-stage technology startup space. I would argue that the ability to execute product has allowed Betaworks to make the greatest headway.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">No doubt fuelled by rampant valuations and news of herds of unicorns roving the Californian plains, everyone has been drawn towards the startup and venture space like moths to the flame. However, it is a very different game to services and not something you can simply stroll into.<\/p>\n<section id=\"the-agency-venture-fund\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The Agency Venture Fund<\/h1>\n<section class=\"pageWrap pageWrap--s marginBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Dollar.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Dollar.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Bigger, older companies with spare cash investing in smaller, younger companies without cash has been happening since the beginning of business time. However in the last six years we have seen agencies enter the venture field. They have done so under formalised venture fund arms which invest cash into early stage technology companies.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The giant Ad Holding Groups have always been busy investing their riches. Notably <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">WPP Ventures<\/strong> (<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.crunchbase.com\/organization\/wpp#\/entity\" target=\"_blank\" rel=\"noopener noreferrer\">Crunchbase<\/a>), the investment arm of WPP Digital for whom investments include a 2015 $50 Million series D Investment in Refinery29. They made $50 Million from their $5 Million investment in Buddy Media when it was sold to Salesforce for $745 Million. <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.interpublic.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Interpublic<\/a> (IPG)<\/strong> (<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/angel.co\/interpublic-group\" target=\"_blank\" rel=\"noopener noreferrer\">AngelList<\/a>), which owns Deutsch, Huge, McCann Erickson, and R\/GA, bought a half-percent stake in Facebook in 2006 for less than $5 million. In 2011 it sold half of its shares and netted $130 million in the process. They are sitting on their remaining .25% stake, valued at $212 Million. Fair play, that was a stupendous coup. In 2016 French advertising agency holding group <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Publicis Group<\/strong> <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/uk.businessinsider.com\/publicis-groupe-launches-publicis-90-startup-fund-2016-1?r=US&IR=T\" target=\"_blank\" rel=\"noopener noreferrer\">launched the Publicis90 fund<\/a> to invest \u20ac10 Million ($10.9 million) in 90 startups. The process by which they are selecting their investments looks like some kind of Facebook-Likes-regional\/national-America\u2019s-Got-Talent-clusterfuck, a million miles away from how funds behave. The lucky startups will also benefit from mentorship from senior management who\u2019ve never launched a startup. Good luck with that.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">However, this is lifestyles of the rich and famous territory. These guys are minted, are giants and their lifestyle choices are far removed from ours. So where is this kind of activity taking place at the atomic level in \u2018smaller\u2019 companies?<\/p>\n<section class=\"pageWrap pageWrap--m marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content zi-chrome display-block\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Row.jpg\" \/><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Back in 2011 there was a lot of noise about agencies setting up funds including the $16 million BBH Black Sheep fund and Method Inc rounding up $30 million. This represented a false start as many announced funds failed to pan out. The lesson seems to be that once you are acquired you also give up your ambitions of making cash venture investments. Your new masters want you focused on making cash rather than spending it (Viva la independencia).<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">One of the few agencies that sits in a holding group that has maintained its ability to play in the venture space is <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">RGA<\/strong>. Their investment arm <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">RGA Ventures<\/strong> (<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.crunchbase.com\/organization\/r-ga-ventures#\/entity\" target=\"_blank\" rel=\"noopener noreferrer\">Crunchbase<\/a>) has been highly active. That activity is principally driven through their RGA Accelerators in which they begin with $120K investments for up to 6% equity. They also invest greater amounts and follow on, working not just at seed, but also Series A\/B, mostly in line with a lead investor. They are able to present themselves as a unique strategic investor by bringing not only cash but also their services, resources, and a deep and wealthy network to the party\u200a&mdash;\u200aan apparently virtuous circle.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">All of this activity relies on having spare cash to invest, which only happens at a certain scale. A new agency would have to put a few years of hard work in to build enough reserves to afford to diversify into investing. There are however other ways in which smaller companies are getting some startup equity action and that is by getting paid in equity rather than cash.<\/p>\n<section id=\"services-for-equity\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Services for Equity<\/h1>\n<section class=\"pageWrap pageWrap--s marginBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Old.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Old.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The practice of companies being paid for their services in equity rather than cash by clients is nothing new to commerce or to the tech sector.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The practice has been a near constant in the industrial design field. <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.ammunitiongroup.com\/work\/beats\/\" target=\"_blank\" rel=\"noopener noreferrer\">Ammunition Group<\/a><\/strong> took equity in Beats back in the day and <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.fuseproject.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Fuseproject<\/a><\/strong> is well known for its <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.fastcodesign.com\/1665894\/could-a-change-in-business-model-win-designers-a-place-in-the-c-suite\" target=\"_blank\" rel=\"noopener noreferrer\">venture design-based business model<\/a> that greatly reduces cash fees in return for a royalty\/equity arrangement. Fuseproject notably took an equity stake in Jawbone (admittedly not-so-hot stock right now). <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/smartdesignworldwide.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Smart Design<\/a><\/strong> has been associated with OXO since 1990, having arranged a 3% royalty that generates a double digit percentage of its profits, and has done equity for services deals. Smart founder Davin Stowell notes \u201cInvesting in physical product is tough business\u200a\u2014\u200aeven if you have a great product, AND distribution, AND initial success, scaling becomes a challenge\u201d.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">During the dot com boom Silicon Valley lawyers would on occasion take equity in exchange for their services. But when the bubble burst in the noughties plenty of fingers got burnt and the practice petered out. However, it\u2019s becoming a growing trend in the digital consultancy space, a sign of renewed confidence (or forgotten history) in the tech sector. The barter can solve both parties needs. For startups who don\u2019t have the cash, bartering provides access to the help they need to get to market. For the service provider who does not have the cash spare to invest it gets them a seat at the early stage technology startup venture game.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">It makes a lot of sense as service providers often get to see companies way before VCs at a stage where equity is early enough to be meaningful. As such, to harness that opportunity a number of reputable design focused consultancies have formalised their services for equity propositions.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">In 2014 Frog established <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.frogdesign.com\/frogventures.html\" target=\"_blank\" rel=\"noopener noreferrer\">FrogVentures<\/a><\/strong> (<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.crunchbase.com\/organization\/frogventures#\/entity\" target=\"_blank\" rel=\"noopener noreferrer\">Crunchbase<\/a>). Positioned as a \u2018growth partner to entrepreneurs\u2019, they exchange their design services for equity in early stage startups. Also in 2014 their perennial competitor IDEO established their venture arm <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.ideofutures.com\/#new-page\" target=\"_blank\" rel=\"noopener noreferrer\">IDEO Futures<\/a><\/strong> (<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/angel.co\/ideo\" target=\"_blank\" rel=\"noopener noreferrer\">AngelList<\/a>) to \u2018help new ventures soar\u2019. They act as a seed fund, incubator, and run a startup in residence program through which they take a nominal minority stake in companies they mentor.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">At <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/ustwo.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">ustwo<\/a><\/strong> (<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/angel.co\/ustwo\" target=\"_blank\" rel=\"noopener noreferrer\">AngelList<\/a>) we\u2019ve directly invested in, incubated, and engaged in services for equity deals with early stage tech startups since 2014. We invested in the prototyping tool <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvelapp.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Marvel App<\/a> and co-founded <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/dice.fm\/\" target=\"_blank\" rel=\"noopener noreferrer\">DICE<\/a>, a zero booking fees mobile ticketing service. In 2015 we formalised ventures arm <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">ustwo adventures<\/strong> to manage our growing portfolio.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/designit.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">DesignIt<\/a><\/strong>, who sold to WiPro in 2015, worked on the supplier management tool <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/tradeshift.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Tradeshift<\/a> under a services for equity deal and ended up making $3M on the stock in the process. Branding consultancy <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/redantler.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Red Antler<\/a><\/strong> (<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/angel.co\/red-antler\" target=\"_blank\" rel=\"noopener noreferrer\">AngelList<\/a>) has partnered with startups and early stage companies since being founded in 2007. For select early and late stage venture-backed companies, Red Antler takes equity in addition to fees. Famously they <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.wsj.com\/articles\/service-providers-see-gold-in-shares-of-startups-1441056504\" target=\"_blank\" rel=\"noopener noreferrer\">took equity in then unknown e-commerce mattress company Casper<\/a> which in its latest funding round reached a valuation of $550 million. Nice!<\/p>\n<section class=\"pageWrap pageWrap--m marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content zi-chrome display-block\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Graffiti.jpg\" \/><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Even videographers are in on the game. <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/sandwichvideo.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Sandwich Video<\/a><\/strong>, Silicon Valley\u2019s favourite video maker, <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.forbes.com\/sites\/ellenhuet\/2015\/03\/03\/meet-sandwich-fund-sandwich-video-venture-firm\/#745b43656005\" target=\"_blank\" rel=\"noopener noreferrer\">established a venture arm<\/a> in 2015. For select clients they would front the full costs of a video\u200a\u2014\u200ausually around $100k- in return for $100k of equity. They did not have that setup in place when they did the Twitter and Uber videos, but did score Jawbone stock. And who doesn\u2019t want to be David Choe, the artist who painted Facebook\u2019s first office back in 2005 and got paid in stock rather than $60k in cash. That stock that is now worth $200 million. Jammy sod!<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">There was also the <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/talkingbiznews.com\/2\/coverage-square-files-for-ipo\/\">interesting case of a consultancy called <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">West Studios<\/strong><\/a> that came out of Square\u2019s IPO filing which benefitted only from a consultancy fee but also an option to purchase 375,000 shares of Square\u2019s common stock. This was seen as a <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/uk.businessinsider.com\/jack-dorsey-company-west-studios-llc-2015-10?r=US&IR=T\" target=\"_blank\" rel=\"noopener noreferrer\">little controversial<\/a> at the time as then CEO Jack Dorsey was an also investor in the consultancy.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Why has the services for equity deal been focused largely on early stage startups and not large brand clients? Alternative compensation arrangements such as equity or revenue share are extremely hard to pull off with big brands. Whatever the intent of the stakeholders you\u2019re working with, the very idea tends to blow the fuse when the proposal hits procurement or legal. You may as well be proposing the trafficking of children. Rule of thumb is that for each floor of lawyers your client has, your odds are exponentially longer. All of this means that the services for equity opportunity is largely restricted to startups who can be more flexible.<\/p>\n<blockquote class=\"pageWrap pageWrap--s position-relative marginTopBottom-l breakPointM-marginTopBottom-xl\"><div class=\"blog-quote-before position-absolute bg-marvel\"><\/div><div class=\"tweet-quote blog-quote-after position-absolute bg-marvel cursor-pointer transitionDuration-l transitionProperty-all transitionTimingFunction-cv-easeOutCircular scaleUp--hover zi-weak\"><svg class=\"fill-white opacity-0 pointerEvents-none position-absolute pinCenter transitionProperty-all transitionTimingFunction-easeInOut\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"24\" height=\"20\" viewBox=\"0 0 24 20\"><path d=\"M24,2.37a9.64,9.64,0,0,1-2.83.79A5,5,0,0,0,23.34.37a9.72,9.72,0,0,1-3.13,1.23A4.86,4.86,0,0,0,16.62,0a5,5,0,0,0-4.8,6.2A13.87,13.87,0,0,1,1.67.92,5.13,5.13,0,0,0,3.19,7.67,4.81,4.81,0,0,1,1,7a5,5,0,0,0,3.95,5,4.82,4.82,0,0,1-2.22.09,4.94,4.94,0,0,0,4.6,3.51A9.72,9.72,0,0,1,0,17.73,13.69,13.69,0,0,0,7.55,20c9.14,0,14.31-7.92,14-15A10.17,10.17,0,0,0,24,2.37Z\"\/><\/svg><\/div><p class=\"blog-quote position-relative textAlign-center c-marvel\"><span class=\"blog-quote-text transitionDuration-l transitionProperty-all transitionTimingFunction-easeInOut\">Investing in early-stage technology startups requires patience and long term perspective.<\/p><\/span><\/blockquote>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">All in all there are many indicators of significant intent in the consultancy space to begin to diversify by changing up the terms of business. It is still early days and we\u2019ve not seen many results yet. But be careful not to be seduced by a fairytale. Investing in early-stage technology startups requires patience and long term perspective. It is important to note that for nearly every company above, services for equity is the exception not the rule. Most firms have established and staffed separate companies or divisions to manage these arrangements. They do so for good reason...<\/p>\n<section id=\"stacked-odds\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Stacked Odds<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/BuyTickets.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/BuyTickets.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">So drop $100k or so of cash or services into a future unicorn at seed stage and cash out in between 4 to 7 years later in an IPO or exit. Simples right? Not so fast. However you got a seat at the cap table you need to understand that you are no different to any other investor. The golden rule of investing from legendary stock picker Peter Lynch holds true to investing in startups, just as it does to its cousin gambling...<\/p>\n<section class=\"pageWrap pageWrap--s position-relative marginBottom-l paddingLeft-l paddingTopBottom-xs fontWeight-3 c-slate lineHeight-l fontSize-l breakPointM-lineHeight-xl breakPointM-fontSize-xl\">\u201cNever invest money you can\u2019t afford to lose.\u201d\u200a&mdash;\u200aPeter Lynch<span class=\"position-absolute pinTL bg-marvel borderRadius-s\" style=\"width: 3px; bottom: 0\"><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Services for equity deals usually take place at the very early seed stage. With so little proven or defined in the business the chances of failure are high. How high? A lot of stats get thrown around such as that 90% of startups fail. Most of us are familiar with the rule of thumb that experienced investors rely on: that of 10 startups in <span class=\"display-none breakPointM-display-block position-relative float-left bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTop-m marginBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 310px;margin-left: -60px;box-shadow: -12px 12px 0 0 #009EEB;top: -6px;margin-right: 25px;\">Be prepared to lose every single penny and never under any circumstances bet the farm<\/span> their portfolio, three to four will fail, another three to four will break even and one or two will bring home serious bacon. A 2012 study by Shikhar Ghosh, a senior lecturer at Harvard Business School, found that three in four startups fail to return investors\u2019 capital. Whichever of these statistics are right, it is clear that you are dealing with long odds. You\u2019re essentially playing an expensive round of roulette. So be prepared to lose every single penny and never ever under any circumstances bet the farm.<\/p>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Kittens.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Kittens.jpg\" \/><\/a><\/span><\/span><span class=\"display-block marginTop-m lineHeight-m textAlign-center c-silver fontWeight-3\">Startups are a world where nine in ten kittens die.<\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The journey takes patience. A \u2018liquidity event\u2019 that would return a significant multiple of the original investment could take anything between 4 to 7 years. This is precisely why, for many of the companies I\u2019ve highlighted above, this kind of deal is the exception not the rule.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">You also need to get smart to venture investing. A typical agency team knows as much about startups as a garage mechanic knows about Formula One cars. So why on earth would you think you are going to do better than seasoned investors and VCs? You need to approach with caution, humbly and with eyes open. Understanding that early stage tech investing is a different game to consultancy, many of the aforementioned companies have established dedicated divisions staffed by investment professionals. The setup still does not mirror that of a typical venture firm, but they have become visibly better equipped in the last few years.<\/p>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"ttps:\/\/dl.dropboxusercontent.com\/u\/24093\/Post\/Scrooge.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Scrooge.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">And the \u2018spare cash\u2019 with which we can place some bets? The thing about gambling is that you need to be able to afford a seat at the table. Profits secure you permission to play. The Ad Holding Group\u2019s permission to play comes from their formidable network and the fact they have very deep pockets. For a smaller company to get into the game they need to be generating significant margins and build the reserves from which the excess can be drawn to invest with. That informs the type of work that the agency needs to do, and their ability to charge a premium for it. Major <img decoding=\"async\" class=\"display-inline verticalAlign-middle margin-0\" src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/themes\/marvel\/assets\/images\/key.png\" height=\"20\"> &mdash; Investing is highly risky and you\u2018ll need to generate \u2018spare cash\u2019 to be able to do it.<\/p>\n<section id=\"own-product\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Own Product<\/h1>\n<section class=\"pageWrap pageWrap--m marginTopBottom-l paddingBottom-s\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Own.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Own.jpg\" \/><\/a><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Yes, that\u2019s it! Why don\u2019t we use our skills and resources to build our own products! We can make money whilst we\u2019re asleep by generating passive revenues and finally break free from the linear relationship between effort and revenue. Enterprise SAAS products offer the prospect of building stable <span class=\"display-none breakPointM-display-block position-relative float-left bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTop-m marginBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 340px;margin-left: -60px;box-shadow: -12px 12px 0 0 #009EEB;top: -6px;margin-right: 25px;\"> Since the inception of the instant global market of the app stores and stories of teenagers making million dollar apps over one weekend, agencies of all guises have been building their own products<\/span> subscription revenues and consumer apps offer the prospect of bell-shaped revenue windfall. Since the inception of the instant global market of the app stores and stories of teenagers making million dollar apps over one weekend, agencies of all guises have been building their own products... \u201cA Digital Product is a software enabled product or service that offers some form of utility to a human being\u201d.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Outside of barren holding group agencies, who has successfully brought a product into market? Let\u2019s rise above success being purely defined by how much money was raised in round X or Y as that is money is invested to grow the company rather than an exit. Let\u2019s broaden this out to any of: attracting a significant user base or investment, a big exit, continued media attention or simply as having moved the needle or impacted our digital lives. In crude chronological order, and I am sure people will come at me with what I missed or what success is, here are notable digital products coming from agencies:<\/p>\n<section class=\"pageWrap pageWrap--m marginTopBottom-xl\">\n<div class=\"borderStyle-solid borderWidth-0 borderTopWidth-1 borderLeftWidth-1 borderColor-smoke borderRadiusTop-l overflow-hidden breakPointM-display-table\">\n<div class=\"width-100 bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">37 Signals, originally a web application company, founded in 1999 stopped consulting work in 2005 to focus exclusively on <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/basecamp.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Basecamp<\/a><\/strong>.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency ceased operations.<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Davidville, a small software consulting company, started work on <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.tumblr.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Tumblr<\/a><\/strong> during a two-week gap between contracts in 2007. We all know how that story goes with it\u2019s 2013 sale to Yahoo! for $1.1 Billion.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency ceased operations.<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Digital services agency <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.invokemedia.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Invoke Media<\/a> span out <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/hootsuite.com\/en-gb\" target=\"_blank\" rel=\"noopener noreferrer\">Hootsuite<\/a><\/strong> in 2009, raising US$165 million in Series B in 2013.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/div><\/div>\n<div class=\"display-table borderStyle-solid borderWidth-0 borderTopWidth-1 borderLeftWidth-1 borderColor-smoke\">\n<div class=\"width-100 bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Check-in app <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Gowalla<\/strong> was spun out of the founder\u2019s agency Firewheel in 2009.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency ceased operations<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\"><strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"http:\/\/hipstamatic.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Hipstamatic<\/a><\/strong>, the godfathers of mobile photography, were a Chicago based digital services agency called Synthetic Infatuation before dropping client services to go all in on the photo app in 2010.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency ceased operations.<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">The top selling text editor <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/ia.net\/writer\/\" target=\"_blank\" rel=\"noopener noreferrer\">iA Writer<\/a><\/strong> was first shipped in 2010, an own-product from European client service agency <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/ia.net\/\" target=\"_blank\" rel=\"noopener noreferrer\">iA<\/a>.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/div><\/div>\n<div class=\"display-table borderStyle-solid borderWidth-0 borderTopWidth-1 borderLeftWidth-1 borderColor-smoke\">\n<div class=\"width-100 bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">The task management tool <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.getflow.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Flow<\/a><\/strong> is an own-product released in 2011 by interface design studio <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/metalab.co\/\" target=\"_blank\" rel=\"noopener noreferrer\">Metalab<\/a> and is still run within the confines of the company.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\"><strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/magento.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Magento<\/a><\/strong>, sold in 2011 to eBay for almost $200M, was built out of an e-commerce agency called Varien.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency ceased operations.<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Branding consultancy <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.movingbrands.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Moving Brands<\/a> nurtured motion comic book platform <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.madefire.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Madefire<\/a><\/strong> into life in 2011, before their CEO broke it out, raising a $1.1M seed and $5.2M in Series A in 2013.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/div><\/div>\n<div class=\"display-table borderStyle-solid borderWidth-0 borderTopWidth-1 borderLeftWidth-1 borderColor-smoke\">\n<div class=\"width-100 bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Seattle based Product design and development company <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.artefactgroup.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Artefact<\/a> without outside investment created the resource planning tool <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.10000ft.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">10,000ft<\/a><\/strong>, achieving <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.geekwire.com\/2013\/10000ft\/\" target=\"_blank\" rel=\"noopener noreferrer\">month-to-month profitability within a year<\/a> (Respect!). They span it out to a sister company in 2012.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\"><strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/vine.co\/\" target=\"_blank\" rel=\"noopener noreferrer\">Vine<\/a><\/strong> came from the founders of New York design studio <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/bighuman.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Big Human<\/a>, selling for $30M to Twitter before its official launch in 2012. In Dec 2015 it had 200 million active users.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">London\u2019s <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/mintdigital.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Mint Digital<\/a> created an Instagram fridge magnet printing service <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">StickyGram<\/strong> which they then sold in <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.cityam.com\/article\/printing-site-photobox-snaps-london-based-instagram-firm\" target=\"_blank\" rel=\"noopener noreferrer\">2013 for \u00a35M to \u00a310M<\/a>, after which they split the studio divided operations between client and own product efforts.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating but in an altered state.<\/span><\/div>\n<\/div><\/div>\n<div class=\"display-table borderStyle-solid borderWidth-0 borderTopWidth-1 borderLeftWidth-1 borderBottomWidth-1 borderColor-smoke overflow-hidden breakPointM-borderRadiusBottom-l\">\n<div class=\"width-100 bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Tokyo based UI design shop <a class=\"link link--blue fontWeight-4\"href=\"http:\/\/goodpatch.com\/\">Goodpatch<\/a> launched prototyping tool <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/prottapp.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Prott<\/a> as an own product in 2014.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Scandinavian digital studio <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/bakkenbaeck.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Bakken &amp; Baeck<\/a> launched <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/wake.com\/\">Wake<\/a><\/strong> in 2015, attracting $3.5M of seed investment from First Round, Designer Fund and others.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/div>\n<div class=\"width-100 bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-display-tableCell breakPointM-width-33 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Product Innovation shop <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/madebymany.com\/\">Made By Many<\/a> got into the hard to navigate world of consumer electronics in 2015, releasing interactive programmable ball <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.hackaball.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Hackball<\/a><\/strong>.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/div><\/div>\n<div class=\"centered bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderBottomWidth-1 borderLeftWidth-1 borderColor-smoke borderRadiusBottom-l overflow-hidden breakPointM-width-50\">\n<div class=\"padding-l\"><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">At ustwo we shipped <strong class=\"c-slate lineHeight-l fontSize-l fontWeight-5 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><a class=\"link link--blue fontWeight-4\"href=\"http:\/\/www.monumentvalleygame.com\/\" target=\"_blank\" rel=\"noopener noreferrer\">Monument Valley<\/a><\/strong> in 2014, winning some awards, generating 18M downloads and $14M in revenue. In 2016 we established a dedicated games company in the group. We also launched the NFP <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.engadget.com\/2015\/12\/03\/wayfindr-blind-navigation-standard-google-org-grant\/\" target=\"_blank\" rel=\"noopener noreferrer\">Wayfindr<\/a>, a vision-impaired navigation solution attracting a Google.org grant.<\/span><span class=\"display-block marginTop-s lineHeight-l fontWeight-3 c-silver\">Agency still operating.<\/span><\/div>\n<\/p><\/div>\n<\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">There you have it. Client service agencies are capable of shipping their own products. We don\u2019t know how successful all of these efforts are ultimately going to be. A round raised is money given by investors to grow the business, not to put in the founder\u2019s pockets. What these examples do prove though is that it is possible to launch a product within an agency. What they all have in common is that nearly all these products came from smaller independent shops. Just like venture investing and services for equity arrangements, the opportunity of investing in own-product disappears once you are acquired. Your new masters are not interested in you taking that kind of risk. So when you take the cheque you can kiss those dreams goodbye.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The other interesting thing to note is that in the \u2018olden days\u2019 running the product operation meant the consultancy side of the business ceasing operations. For a small agency with all resources invested in the product effort this is an inevitability, you can\u2019t do both. This is a function of the size of the agency at the time of the product initiative. As for when is the right time, it\u2019s a matter of how many vital organs are shared between the agency and the product operation and whether the conjoined twins would survive the separation.<\/p>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Ship.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Ship.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">No one wants to blow their one big chance in life. So wouldn\u2019t it be wonderful if we could create many big chances? More and more we\u2019re seeing agencies maintain both the consultancy and own product sides of the business rather than betting all their chips on the product. In order to enable both you need to consider the timing and conditions under which you push into own product. Major <img decoding=\"async\" class=\"display-inline verticalAlign-middle margin-0\" src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/themes\/marvel\/assets\/images\/key.png\" height=\"20\"> &mdash; You want to be building a shipyard, not a ship.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><svg class=\"centered display-block marginTopBottom-xl fill-slate\" width=\"64\" height=\"8\" viewBox=\"0 0 64 8\"><path d=\"M4 8c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4z\" \/><\/svg><\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-block paddingBottom-xl c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">There is every reason to try to avoid the well worn path of the agency lifecycle. However it takes steely resolve across the company to do so. Whilst there is no magic bullet, there are numerous examples of companies breaking the mold and shaping their own destiny through venture and own product initiatives.<\/span><\/p>\n<section id=\"chapter-four-future-perspective\"><\/section>\n<section class=\"paddingTop-l paddingBottom-xl\" style=\"background-color: #0052a8;\">\n<h1 class=\"pageWrap pageWrap--s marginTop-m marginBottom-l c-slate fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl breakPointM-marginTop-xl\" style=\"margin-left: auto; margin-right: auto;\"><span class=\"display-block c-white fontSize-xxl lineHeight-xxl breakPointM-fontSize-xxxl breakPointM-lineHeight-xxxl breakPointL-fontSize-xxxxl breakPointL-lineHeight-xxxxl fontWeight-5\">Chapter IV: Future Perspective<\/span><\/h1>\n<section class=\"pageWrap pageWrap--s marginBottom-m breakPointM-marginBottom-xl\">\n<div class=\"c-white fontWeight-3 lineHeight-l fontSize-l breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">Over chapters I, II and III we\u2019ve run through the conditions for industry, agency and talent as well as highlighted the evolutionary avenues being explored by the most progressive. Now let\u2019s bring it all together in a blueprint for the next evolutionary step for the studio model... the Digital Product Studio.<\/div>\n<\/section>\n<section class=\"pageWrap pageWrap--m\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl is-loading--white display-block\"><span class=\"aspectRatio-content zi-chrome display-block\"><img decoding=\"async\" class=\"b-lazy display-block centered marginBottom-m b-loaded\" src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Car.jpg\" alt=\"\" \/><\/span><\/span><\/section>\n<\/section>\n<section id=\"the-digital-product-studio\"><\/section>\n<section id=\"the-digital-product-studio\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The Digital Product Studio<\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio blends three components: Consultancy, Venture &amp; Own Product. Running through each like letters on a stick of rock is a structural, policy, and cultural framework that binds them all together. Each feeds and informs the other in a powerful virtuous circle of network, experience, funding, brand, craft, and talent.<\/p>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Tri.png\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Tri.png\" \/><\/a><\/span><\/span><\/section>\n<section id=\"1-3-consultancy\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">I\/III Consultancy<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Yoda.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Yoda.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The focus of the Digital Product Studio\u2019s consultancy work is purely on the delivery of digital products. To repeat...<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">A Digital Product is a software enabled product or service that offers some form of utility to a human being. \u2018Digital product\u2019 or \u2018product\u2019 work is the delivery of the digital touchpoints of a product or service.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-none breakPointM-display-block position-relative float-right bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTopBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 240px;margin-right: -60px;box-shadow: -12px 12px 0 0 #009EEB;top: -6px;margin-left: 25px;\">The Digital Product Studio is capable of taking a product from meeting to market.<\/span>The Digital Product Studio has the strategic, product management, design, and engineering talent that is capable of taking a product through to market launch and beyond from meeting #1. That capability means it earns its keep by getting products to market rather than exploiting any one stage of the process. That keeps things honest and outcome oriented.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio completely eschews digital marketing work, which suffers from perpetual commoditisation (Seriously, don\u2019t go near it, it\u2019s like crack cocaine. You\u2019ll get hooked and it will be hard to get off it). Product work is less sensitive to economic downturns. The decision to cut a seasonal campaign marketing budget is ten times easier than the decision to cut a product and service development initiative that runs over many years.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio is \u2018platform agnostic\u2019 by virtue of having engineering talent that covers multiple platforms. That engineering talent understands software, QA, integration, and embedded systems and it can shoot the breeze with the technical team of any major company. Well beyond web and mobile, it is ready to engage with emerging platforms such as wearables, VR, and beyond to stay at the forefront of digital product (\u201cScreens? Where we\u2019re going, we don\u2019t need screens\u201d). In doing all of the above it stays ahead of the technology and platform commoditisation cycle by being able to \u2018move to the next\u2019 in a timely fashion.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio focuses on putting work of the highest possible quality and standard into the world. It knows that poor quality output will ensure certain doom and that in a virtuous upward spiral, a proven track record of delivering quality products to market will attract opportunity.<\/p>\n<blockquote class=\"pageWrap pageWrap--s position-relative marginTopBottom-l breakPointM-marginTopBottom-xl\"><div class=\"blog-quote-before position-absolute bg-marvel\"><\/div><div class=\"tweet-quote blog-quote-after position-absolute bg-marvel cursor-pointer transitionDuration-l transitionProperty-all transitionTimingFunction-cv-easeOutCircular scaleUp--hover zi-weak\"><svg class=\"fill-white opacity-0 pointerEvents-none position-absolute pinCenter transitionProperty-all transitionTimingFunction-easeInOut\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"24\" height=\"20\" viewBox=\"0 0 24 20\"><path d=\"M24,2.37a9.64,9.64,0,0,1-2.83.79A5,5,0,0,0,23.34.37a9.72,9.72,0,0,1-3.13,1.23A4.86,4.86,0,0,0,16.62,0a5,5,0,0,0-4.8,6.2A13.87,13.87,0,0,1,1.67.92,5.13,5.13,0,0,0,3.19,7.67,4.81,4.81,0,0,1,1,7a5,5,0,0,0,3.95,5,4.82,4.82,0,0,1-2.22.09,4.94,4.94,0,0,0,4.6,3.51A9.72,9.72,0,0,1,0,17.73,13.69,13.69,0,0,0,7.55,20c9.14,0,14.31-7.92,14-15A10.17,10.17,0,0,0,24,2.37Z\"\/><\/svg><\/div><p class=\"blog-quote position-relative textAlign-center c-marvel\"><span class=\"blog-quote-text transitionDuration-l transitionProperty-all transitionTimingFunction-easeInOut\">The Digital Product Studio focuses on putting work of the highest possible quality and standard into the world.<\/p><\/span><\/blockquote>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio charges a premium for its services. That\u2019s not because it simply slaps a high price tag on its work, but because it offers a valuable commodity that is not readily available on the market. That commodity is the ability to design, engineer, and launch digital products for and with partners. Without the ability to get a product to market and into users\u2019 hands, even the greatest idea, <span class=\"display-none breakPointM-display-block position-relative float-left bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTop-m marginBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 280px; margin-left: -60px; box-shadow: -12px 12px 0 0 #009EEB; top: -6px; margin-right: 25px\">Without the ability to get a product into users\u2019 hands, even the greatest ideas are meaningless<\/span> funding, and network are nigh-on meaningless. This is the thing that companies with almost infinite resources greatly covet. The Digital Product Studio serves as the missing piece, the essential component. This premium offering is not sold in hourly units of time, but by the day and week to shift the focus on the delivery of value rather than of time. A high percentage of the market does not understand the value it delivers. The Digital Product Studio is OK with that and works with select clients that do.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The process by which the Digital Product Studio executes is as important as the output. This is the never-fixed, ever-evolving toolbox of methods; integrated teams, agile, SCRUM, lean, continuous delivery etc. Imparting these methodologies to clients and partners forms part of the offering. Facilitating knowledge transfer sets a path towards self-reliance and ultimately handover. Beyond that, if a client wants to continue working together it is because they want to rather than that they have to.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-none breakPointM-display-block position-relative float-right bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTopBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 240px;margin-right: -60px;box-shadow: -12px 12px 0 0 #009EEB;top: -6px;margin-left: 25px;\">The Digital Product Studio seeks out partnerships with clients rather than the antiquated shit-flows-downhill vendor client relationship. <\/span>The Digital Product Studio seeks out partnerships with clients rather than the antiquated shit-flows-downhill vendor client relationship. It steadfastly avoids abusive, non-reciprocal relationships. It will work with, but not through, third parties to work with clients as it will not endanger the quality of access, process, and communications necessary to build good products. Teams take on the same emotional commitment to the product\u2019s success as the client\u200a\u2014\u200awe\u2019re all in it together.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio mirrors the team, skills, and methods of world-leading tech companies. Tech companies and startups are understandably precious about letting anyone work on their core consumer facing products and services. Tech clients have existing teams in place and don\u2019t want to give away their most exciting work for some agency to drag away to a cave. The only partners they will allow to do so are those who reflect the best of their culture, understand their world and who at a minimum produce to their standards. The Digital Product Studio integrates and collaborates with existing client teams to form \u2018one team\u2019 for the engagement. It is for these reasons that tech companies and startups will grant access to their hallowed, core consumer facing products. It is also the reason that non-tech clients, who aspire to the standards and methods of the tech sector, want to work with a Digital Product Studio.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio needs to do it all better than its predecessor model: capabilities, product development, collaboration, process, and culture, to deliver the compelling package. That premium proposition generates valuable cash reserves. These reserves are the rocket fuel for diversification into venture and own product work.<\/p>\n<section id=\"2-3-venture\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">II\/III Venture<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Jump.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Jump.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio is actively engaged in the venture space, managing a portfolio of early stage technology company investments. It builds that portfolio through \u2018services for equity\u2019 deals and through direct cash investments in early stage startups. It measures its investments carefully to protect a minimum level of runway for the cash generating consultancy arm of the business.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-none breakPointM-display-block position-relative float-left bg-marvel c-white paddingTopBottom-m paddingLeftRight-l marginTop-m marginBottom-xxs borderRadius-m fontSize-xxl lineHeight-xxl fontWeight-4\" style=\"max-width: 320px;margin-left: -60px;box-shadow: -12px 12px 0 0 #009EEB;top: -6px;margin-right: 25px;\">The Digital Product Studio has a dedicated venture team with investment experience<\/span>The Digital Product Studio has a dedicated venture team with investment experience that oversees the portfolio and that seeks out and validates new opportunities for the company. It leverages the product expertise, market insight and proximity of the consultancy arm of its business to early stage entrepreneurs and technologies to support these efforts and generate deal flow.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio knows what it brings to the table of early stage technology companies\u200a\u2014\u200athe ability to take a digital product through to market launch. It is grounded, humble, and understands that its role, albeit essential, is just one of many necessary for success.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">For services for equity partnerships the Digital Product Studio seeks out experienced partners. It understands that any industry worth \u2018disrupting\u2019 is a high walled garden. It does not engage Jack and Jane who have an \u2018app idea\u2019 and granny\u2019s inheritance. It seeks out partnerships with industry veterans who understand the opportunity, risks, and pain points of a sector. These veterans have the knowledge, access, and contacts necessary to improve the chances of success. The Digital Product Studio serves as the enabler for that partner who will put their material existence on the line for the endeavour.<\/p>\n<section id=\"3-3-own-product\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">III\/III Own Product<\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--100 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Robot.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Robot.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio deploys its internal resources to engage in own product initiatives, exploiting the instant global marketplace of the web and app stores. It does so in order to both generate passive revenues as well as to raise awareness of the studio. This serves as a form of \u2018marketing through doing\u2019. These initiatives serve as a testing and training ground for its teams and technologies, helping the studio refine its ways of working (after all, nothing keeps you more honest that making your own stuff).<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Not all of The Digital Product Studio own product initiatives are focused on creating revenues, nor is their intent on creating the next Facebook. As such, these initiatives come in all shapes and sizes and under the fail fast and fail often ethos, many of them will not see public launch. What is important throughout is learning, progress and fuelling passion.<\/p>\n<blockquote class=\"pageWrap pageWrap--s position-relative marginTopBottom-l breakPointM-marginTopBottom-xl\"><div class=\"blog-quote-before position-absolute bg-marvel\"><\/div><div class=\"tweet-quote blog-quote-after position-absolute bg-marvel cursor-pointer transitionDuration-l transitionProperty-all transitionTimingFunction-cv-easeOutCircular scaleUp--hover zi-weak\"><svg class=\"fill-white opacity-0 pointerEvents-none position-absolute pinCenter transitionProperty-all transitionTimingFunction-easeInOut\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"24\" height=\"20\" viewBox=\"0 0 24 20\"><path d=\"M24,2.37a9.64,9.64,0,0,1-2.83.79A5,5,0,0,0,23.34.37a9.72,9.72,0,0,1-3.13,1.23A4.86,4.86,0,0,0,16.62,0a5,5,0,0,0-4.8,6.2A13.87,13.87,0,0,1,1.67.92,5.13,5.13,0,0,0,3.19,7.67,4.81,4.81,0,0,1,1,7a5,5,0,0,0,3.95,5,4.82,4.82,0,0,1-2.22.09,4.94,4.94,0,0,0,4.6,3.51A9.72,9.72,0,0,1,0,17.73,13.69,13.69,0,0,0,7.55,20c9.14,0,14.31-7.92,14-15A10.17,10.17,0,0,0,24,2.37Z\"\/><\/svg><\/div><p class=\"blog-quote position-relative textAlign-center c-marvel\"><span class=\"blog-quote-text transitionDuration-l transitionProperty-all transitionTimingFunction-easeInOut\">The Digital Product Studio is setup as a shipyard rather than a ship.<\/p><\/span><\/blockquote>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Just like venture activities, there is risk associated with own product initiatives. They both have the potential to depress the revenues of the consultancy arm. So the Digital Product Studio measures its investments carefully to protect a minimum runway for the business as a whole.<\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The Digital Product Studio is setup as a shipyard rather than a ship. It gauges when it can invest its people and time into an own product initiative. Initially it seeks to establish a parallel and independent team until it wishes to push the product out of the nest as an independent but federated company with its own leadership. Should it then ultimately wish to sell the own product company it does not mean the end of the ability to create further products. From one shot to many shots.<\/p>\n<section id=\"the-magic-numbers\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The Magic Numbers<\/h1>\n<section class=\"pageWrap pageWrap--m marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--100 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/LucaPacioli.jpg\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/LucaPacioli.jpg\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The old adage that you need money to make money very much applies to the investment game. Your profit and cash reserves are the rocket fuel for investing in startups, for enabling equity for services deals or for investing in your own products. Let\u2019s say you don\u2019t want to take on investment yourself and you want to self-finance this activity. When and how do you safely begin to accrue cash to engage in risk based venture activities? The rule of thumb in the agency game is to maintain minimum three to four months operating cash, aka Time to Die, at all times. If you got dropped by every single one of your clients in one week this would be how long you have to live without having to change a thing or do nasty stuff like firing people. As such a very crude and idealistic model based on 20% margins, 35% corporation tax and sustaining 3 months runway would look a little something like this...<\/p>\n<section class=\"pageWrap pageWrap--m marginTopBottom-l paddingBottom-s\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Numbers.png\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Numbers.png\" \/><\/a><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">As you can see, if you\u2019re starting fresh you\u2019re going to have to put a few years in before you\u2019ve stockpiled the \u2018surplus cash\u2019 shown in green. Only then can you afford direct investments or services for equity activities that depress revenues. That is unless you take investment that does not challenge your independence (if there is such a thing). Once you hit $5M or so you\u2019ve built yourself a nice but modest investment pot without betting the farm. At $20M revenues you\u2019ve got some decent angel investor sized cash to splash. Naturally if any of your bets delivers a return over the years then you can grow your investment pot, double down or \u2018diversify\u2019 your portfolio. Just remember, you need to be ready and able to lose every single cent of your investment pot. Ladies and gentlemen, place your bets!<\/p>\n<section id=\"make-money-money-money\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Make Money Money<\/h1>\n<section class=\"pageWrap pageWrap--m marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--16-9 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/RevenueModel.png\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/RevenueModel.png\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">The blend of ascending sine wave of consultancy service revenue, passive own product income (either bell curve one-time payment or ascending subscription payment) and peak and trough venture exit windfalls should look a little something like this. Obviously this illustration is rather Hollywood. We\u2019re overlaying three models here, each of which is hard to pull off and all of which are even harder to combine. But hey, if this was easy then anyone could do it and the most inspirational movies are \u201cBased on a true story\u201d.<\/p>\n<section class=\"width-100 position-relative display-none breakPointL-display-block\"><img class=\"b-lazy position-absolute pinTL\" width=\"330\" height=\"93\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Pez-01.jpg\" style=\"left: -20px; transform: rotate(-15deg)\" \/><img class=\"b-lazy position-absolute pinTR\" width=\"330\" height=\"93\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/12\/Pez-02.jpg\"  style=\"right: -20px; transform: rotate(15deg)\" \/><\/section>\n<section id=\"the-wrapper\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">The Wrapper<\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Without going all HBR on you, wrapped around and running through all of these three components are several other key characteristics. The Digital Product Studio is...<\/p>\n<section class=\"pageWrap pageWrap--m marginTopBottom-xl\">\n<div class=\"borderStyle-solid borderWidth-0 borderTopWidth-1 borderLeftWidth-1 borderColor-smoke borderRadiusTop-l overflow-hidden breakPointM-display-table\">\n<div class=\"breakPointM-display-tableCell bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderColor-smoke breakPointM-width-50\">\n<div class=\"padding-l\"><span class=\"display-block marginBottom-xs c-slate lineHeight-xl fontSize-xl fontWeight-5\">Digitally Native.<\/span><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Let\u2019s pretend I did not write those two words, but to point out the bleedingly obvious, the company, and its people have to be digital first. That\u2019s nothing to do with age and everything to do with mindset. Get anyone holding onto the past the hell out the way.<\/span><\/div>\n<\/div>\n<div class=\"breakPointM-display-tableCell bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-width-50 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block marginBottom-xs c-slate lineHeight-xl fontSize-xl fontWeight-5\">Resolutely Independent.<\/span><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">The odds of you having permission to engage in the risk of pulling any of this off unless you\u2019re independent are 10,000 to 1. Remain fiercely independent because if you sell the dream is over.<\/span><\/div>\n<\/div><\/div>\n<div class=\"borderStyle-solid borderWidth-0 borderTopWidth-1 borderLeftWidth-1 borderColor-smoke breakPointM-display-table\">\n<div class=\"breakPointM-display-tableCell bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderColor-smoke breakPointM-width-50\">\n<div class=\"padding-l\"><span class=\"display-block marginBottom-xs c-slate lineHeight-xl fontSize-xl fontWeight-5\">Purpose Driven.<\/span><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Make sure you have a purpose. You need everything pointed at something of human worth otherwise it will all become \u2018just work\u2019 and not be sustainable. Besides, you\u2019re not going to get any of those pesky and idealistic millennials to work for you without a purpose. Remember you\u2019re competing with Google, Facebook et al for talent who are all going to pay so much more.<\/span><\/div>\n<\/div>\n<div class=\"breakPointM-display-tableCell bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-width-50 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block marginBottom-xs c-slate lineHeight-xl fontSize-xl fontWeight-5\">Sharing Success.<\/span><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">Through a profit share mechanism, share a percentage of profits from the consultancy, venture, and own product business to bind everyone together. This way you can provide the \u2018stability\u2019 of an agency package with a taste of the upside that a startup can offer.<\/span><\/div>\n<\/div><\/div>\n<div class=\"borderStyle-solid borderWidth-0 borderTopWidth-1 borderBottomWidth-1 borderLeftWidth-1 borderColor-smoke borderRadiusBottom-l overflow-hidden breakPointM-display-table\">\n<div class=\"breakPointM-display-tableCell bg-white borderStyle-solid borderWidth-0 borderRightWidth-1 borderColor-smoke breakPointM-width-50\">\n<div class=\"padding-l\"><span class=\"display-block marginBottom-xs c-slate lineHeight-xl fontSize-xl fontWeight-5\">People Investing.<\/span><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">The sooner companies realise that a human can produce six, maybe seven hours of quality output in a day the better. The alternative is to rake it like manure over late night and weekend sessions and reduce output quality and employee engagement in the process. The studio of the future will foster a culture that respects work life balance, human need, and it will honour commitment as a two way deal. That means flexible, output-focused working policies, and support for working parents. This is the glue that keeps your community together through thick and inevitable thin.<\/span><\/div>\n<\/div>\n<div class=\"breakPointM-display-tableCell bg-snow borderStyle-solid borderWidth-0 borderRightWidth-1 borderTopWidth-1 borderColor-smoke breakPointM-width-50 breakPointM-borderTopWidth-0\">\n<div class=\"padding-l\"><span class=\"display-block marginBottom-xs c-slate lineHeight-xl fontSize-xl fontWeight-5\">A WIP.<\/span><span class=\"display-block c-slate lineHeight-xl fontSize-xl fontWeight-3\">The moment that you think you\u2019ve got it all worked out and present your \u2018process\u2019 in seventeen simple steps on a beautified keynote slide it is the beginning of the end. When it comes to ways of working, consultancy doesn\u2019t have it right and startups don\u2019t have it right. The studio will not work different ways on consultancy, venture or own product engagements. It will be working along one path that is non-prescriptive, always learning, and always evolving.<\/span><\/div>\n<\/div><\/div>\n<\/section>\n<section id=\"the-wrap\"><\/section>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\"><span class=\"marginTop-xl display-block c-slate fontSize-xxl lineHeight-xxl breakPointM-fontSize-xxxl breakPointM-lineHeight-xxxl breakPointL-fontSize-xxxxl breakPointL-lineHeight-xxxxl fontWeight-5\">The Wrap<\/span><\/h1>\n<section class=\"pageWrap pageWrap--s marginTopBottom-l paddingBottom-s\"><span class=\"aspectRatio aspectRatio--100 is-loading is-loading--xl display-block bg-snow\"><span class=\"aspectRatio-content display-block\"><a class=\"link link--blue fontWeight-4\"href=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/05\/Nasa.png\"><img class=\"b-lazy width-100\" src=data:image\/gif;base64,R0lGODlhAQABAAAAACH5BAEKAAEALAAAAAABAAEAAAICTAEAOw== data-src=\"https:\/\/marvel7077.wpengine.com\/wp-content\/uploads\/2016\/05\/Nasa.png\" \/><\/a><\/span><\/span><\/section>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-block paddingBottom-m c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">It is perhaps appropriate to have closed on the topic of being a WIP. Just between you and me, it even applies to this very model. After all, life is what happens whilst you\u2019re busy making other plans. In that context any \u2018plan\u2019 is simply a North Star to navigate against along your journey into the unknown. You most likely won\u2019t make landfall where you set out for. So in reality the journey is the only thing that is real. Remember to enjoy it.<\/span><\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-block paddingBottom-m c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">We are living in humanity\u2019s most exciting age and it\u2019s only going to get exponentially more so as technology and computing rapidly evolves. For those of us in the industry, as the most enabled, empowered, and creative generation ever seen, we have the opportunity to shape the future in some way. This is the real dent the universe territory. So please do something difficult. Please do something that has purpose. The Digital Product Studio is just one such vehicle. Sure, 100,000 things could go wrong before you achieve escape velocity and get into orbit. It\u2019s undoubtedly hard, but so is anything worth doing.<\/span><\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><span class=\"display-block paddingBottom-xl c-slate fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl breakPointL-fontSize-xxl breakPointL-lineHeight-xxxl\">Besides, someone\u2018s got to figure it out and fortune favours the bold.<\/span><\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\"><svg class=\"centered display-block marginBottom-xl fill-slate\" width=\"64\" height=\"8\" viewBox=\"0 0 64 8\"><path d=\"M4 8c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4zm28 0c2.209 0 4-1.791 4-4s-1.791-4-4-4-4 1.791-4 4 1.791 4 4 4z\" \/><\/svg><\/p>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">I also contribute to general nonsense on twitter at <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.twitter.com\/ezyjules\" target=\"_blank\" rel=\"noopener noreferrer\">@ezyjules<\/a>. For those interested I\u2019d love to continue the discussion on any of the above on social using the hashtag <a class=\"link link--blue fontWeight-4\"href=\"https:\/\/www.twitter.com\/hashtag\/DigitalNation\" target=\"_blank\" rel=\"noopener noreferrer\">#DigitalNation<\/a>.<\/p>\n<h1 class=\"pageWrap pageWrap--s marginTop-xl marginBottom-l c-black fontWeight-5 lineHeight-xxl fontSize-xxl breakPointM-lineHeight-xxxl breakPointM-fontSize-xxxl\" style=\"margin-left: auto; margin-right: auto;\">Disclosure<\/h1>\n<p class=\"pageWrap pageWrap--s marginBottom-m paddingBottom-s c-slate lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">Because something or other at this stage I need to tell you:<\/p>\n<ul class=\"pageWrap pageWrap--s list list--unordered marginBottom-l lineHeight-l fontSize-l fontWeight-3 breakPointM-fontSize-xl breakPointM-lineHeight-xl\">\n<li>I am an investor in Marvel and in DICE.<\/li>\n<li>I am an owner at ustwo. You can find out about us on the internet somewhere.<\/li>\n<li>If you have read this far and are in the creative industry in the US then please \u2018<a class=\"link link--blue fontWeight-4\"href=\"https:\/\/medium.com\/@ezyjules\/why-your-company-should-pledge-parental-leave-1c79ee9e2ca4#.lh9fdrnb4\" target=\"_blank\" rel=\"noopener noreferrer\">Pledge Parental Leave<\/a>\u2019.<\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>In 2013, we explored the state and future of the digital consultancy industry, posing the question &#8220;How, When and Where Will The First Truly Great Digital Design Studio Emerge?&#8221;. Three years later in 2016, enough time has passed to discern patterns from trends. In that time the industry has experienced seismic shifts and a sweeping wave of consolidation. So let\u2019s&#8230; <a class=\"link link--blue fontWeight-4\" href=\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/\">Read More &#65515;<\/a><\/p>\n","protected":false},"author":10,"featured_media":1949,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[485],"tags":[],"class_list":["post-1933","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-design-thinking"],"acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v15.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/\" \/>\n<meta property=\"og:locale\" content=\"en_GB\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"State of the Digital Nation 2016 | Marvel Blog\" \/>\n<meta property=\"og:description\" content=\"In 2013, we explored the state and future of the digital consultancy industry, posing the question &quot;How, When and Where Will The First Truly Great Digital Design Studio Emerge?&quot;. Three years later in 2016, enough time has passed to discern patterns from trends. In that time the industry has experienced seismic shifts and a sweeping wave of consolidation. So let\u2019s... Read More &#65515;\" \/>\n<meta property=\"og:url\" content=\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/\" \/>\n<meta property=\"og:site_name\" content=\"Marvel Blog\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/marvelapp\" \/>\n<meta property=\"article:published_time\" content=\"2016-05-23T06:20:48+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2020-09-03T11:53:56+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/marvelapp.com\/wp-content\/uploads\/2016\/05\/twitter-nation.png\" \/>\n\t<meta property=\"og:image:width\" content=\"600\" \/>\n\t<meta property=\"og:image:height\" content=\"600\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@marvelapp\" \/>\n<meta name=\"twitter:site\" content=\"@marvelapp\" \/>\n<meta name=\"twitter:label1\" content=\"Est. reading time\">\n\t<meta name=\"twitter:data1\" content=\"59 minutes\">\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Organization\",\"@id\":\"https:\/\/marvelapp.com\/blog\/#organization\",\"name\":\"Marvel\",\"url\":\"https:\/\/marvelapp.com\/blog\/\",\"sameAs\":[\"https:\/\/www.facebook.com\/marvelapp\",\"https:\/\/www.instagram.com\/marvelapp\/\",\"https:\/\/www.linkedin.com\/company\/marvel-app\/\",\"https:\/\/twitter.com\/marvelapp\"],\"logo\":{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/marvelapp.com\/blog\/#logo\",\"inLanguage\":\"en-GB\",\"url\":\"https:\/\/marvelapp.com\/wp-content\/uploads\/2018\/06\/Logo-Light.png\",\"width\":1605,\"height\":1130,\"caption\":\"Marvel\"},\"image\":{\"@id\":\"https:\/\/marvelapp.com\/blog\/#logo\"}},{\"@type\":\"WebSite\",\"@id\":\"https:\/\/marvelapp.com\/blog\/#website\",\"url\":\"https:\/\/marvelapp.com\/blog\/\",\"name\":\"Marvel Blog\",\"description\":\"Ideas and words on user experience, design, collaboration and more\",\"publisher\":{\"@id\":\"https:\/\/marvelapp.com\/blog\/#organization\"},\"potentialAction\":[{\"@type\":\"SearchAction\",\"target\":\"https:\/\/marvelapp.com\/blog\/?s={search_term_string}\",\"query-input\":\"required name=search_term_string\"}],\"inLanguage\":\"en-GB\"},{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/#primaryimage\",\"inLanguage\":\"en-GB\",\"url\":\"https:\/\/marvelapp.com\/wp-content\/uploads\/2016\/05\/twitter-nation.png\",\"width\":600,\"height\":600},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/#webpage\",\"url\":\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/\",\"name\":\"State of the Digital Nation 2016 | Marvel Blog\",\"isPartOf\":{\"@id\":\"https:\/\/marvelapp.com\/blog\/#website\"},\"primaryImageOfPage\":{\"@id\":\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/#primaryimage\"},\"datePublished\":\"2016-05-23T06:20:48+00:00\",\"dateModified\":\"2020-09-03T11:53:56+00:00\",\"inLanguage\":\"en-GB\",\"potentialAction\":[{\"@type\":\"ReadAction\",\"target\":[\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/\"]}]},{\"@type\":\"Article\",\"@id\":\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/#webpage\"},\"author\":{\"@id\":\"https:\/\/marvelapp.com\/blog\/#\/schema\/person\/cb2e96bfe7a79a370188268360ad2c97\"},\"headline\":\"State of the Digital Nation 2016\",\"datePublished\":\"2016-05-23T06:20:48+00:00\",\"dateModified\":\"2020-09-03T11:53:56+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/#webpage\"},\"commentCount\":37,\"publisher\":{\"@id\":\"https:\/\/marvelapp.com\/blog\/#organization\"},\"image\":{\"@id\":\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/#primaryimage\"},\"articleSection\":\"Design Thinking\",\"inLanguage\":\"en-GB\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\/\/marvelapp.com\/blog\/state-of-the-digital-nation-2016\/#respond\"]}]},{\"@type\":\"Person\",\"@id\":\"https:\/\/marvelapp.com\/blog\/#\/schema\/person\/cb2e96bfe7a79a370188268360ad2c97\",\"name\":\"Jules\",\"image\":{\"@type\":\"ImageObject\",\"@id\":\"https:\/\/marvelapp.com\/blog\/#personlogo\",\"inLanguage\":\"en-GB\",\"url\":\"https:\/\/secure.gravatar.com\/avatar\/aed075d6659e263fa52710a82ebc6ea96f2193efc5378aedee0cf89aa66f73fc?s=96&d=mm&r=g\",\"caption\":\"Jules\"},\"description\":\"Co-owner @ustwo. Englishman in New York. Riffing on design \/ tech \/ startups \/ life.\"}]}<\/script>\n<!-- \/ Yoast SEO Premium plugin. -->","_links":{"self":[{"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/posts\/1933","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/users\/10"}],"replies":[{"embeddable":true,"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/comments?post=1933"}],"version-history":[{"count":0,"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/posts\/1933\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/media\/1949"}],"wp:attachment":[{"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/media?parent=1933"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/categories?post=1933"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/marvelapp.com\/blog\/wp-json\/wp\/v2\/tags?post=1933"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}