EP#1 Life After Agency Life

Summary

On Strategy Showcase: EP#1 - Planning On The Outside (Life After Agency Life)
Host: Fergus O’Carroll
Release Date: December 2, 2024

---

Introduction: Shifting Landscapes in Strategic Roles

In the inaugural episode of On Strategy Showcase, host Fergus O’Carroll delves into a significant trend shaking the marketing and advertising industry: the departure of senior strategists from traditional agency roles to embark on entrepreneurial ventures. Highlighting recent exits like Martin Weigel from AMV BBDO and Martin Beverly alongside Richard Brim from Adam and Eve ddb, Fergus sets the stage for a deeper exploration of why seasoned strategists are seeking new horizons beyond the confines of established agencies.

Guest Introductions: Trailblazers Beyond Agencies

Fergus welcomes three prominent guests who exemplify this shift:

• James Herman – Founding Partner at Previously Unavailable and co-founder of New and Improved Ventures.
• Adrian Ho – Co-founder and Chairman of Zeus Jones in California.
• Brent Vartin – Managing Partner at Bullish in New York.

These strategists have leveraged their extensive agency experience to venture into startups, venture capital, and innovative consulting, demonstrating the diverse paths available post-agency life.

Experiences of Leaving Agencies and Building Ventures

Adrian Ho: Navigating Agency Constraints

Adrian Ho shares pivotal moments that catalyzed his transition from traditional agency work to founding Zeus Jones. Reflecting on his tenure at Fallon, he recounts the challenges faced while working on high-profile campaigns for Microsoft and Sony:

"We won the Sony Walkman business with an innovative strategy, but were let go six weeks later when the client couldn’t implement our vision due to product limitations." [14:23]

Similarly, a successful campaign for United Airlines was abruptly halted once the client secured additional funding for service upgrades, underscoring the limitations of solving deep-rooted business problems solely through advertising [16:08].

These experiences highlighted the frustration of strategists who could envision transformative solutions but were constrained by agency-client dynamics, prompting Adrian to seek avenues where strategic impact could extend beyond mere advertising.

Brent Vartin: Integrating Strategy with Venture Capital

Brent Vartin discusses the founding of Bullish, a hybrid venture capital firm and brand agency. By merging investment with in-house research, strategy, design, and advertising, Bullish aims to embed brand strategy into the heart of startups and growing businesses. This integrated approach allows for:

"Creating deep, emotional, sticky relationships between companies and their customers", enhancing brand value from the foundation up [33:55].

Brent emphasizes the unique value strategists bring to venture capital, bridging the gap between financial acumen and brand-centric growth, thus fostering more holistic business development.

James Herman: From Advertising Effectiveness to Startup Innovation

James Herman outlines his journey from agency planner at Colenso BBDO to founding Previously Unavailable and New and Improved Ventures. Recognizing that large organizations struggle with innovation, he pivoted to support startups where he could make a more immediate and significant impact. Key aspects of his approach include:

• Equity-Based Services: Trading consultancy services for equity stakes, allowing for mutual growth and aligned incentives [40:01].
• Long-Term Value Creation: Focusing on building brand equity that translates into substantial financial returns over time.

James highlights the profound financial benefits of this model, noting a net profit of 50% from investment returns, significantly surpassing traditional agency revenue models [32:49].

Insights on the Value of Strategists Outside Traditional Agencies

Embracing a Broader Business Perspective

All three guests concur that strategists possess invaluable skills in understanding and solving complex business problems beyond advertising. James articulates:

"Planners in the industry are talking about the same problems for 25 years. It's inspiring to see people actually solving those problems in new ways." [09:43]

Adrian adds that venturing beyond agencies allows strategists to influence fundamental business decisions, fostering environments where brand strategy is integral to operations rather than an afterthought [25:08].

Bridging the Gap Between Branding and Business Growth

Brent emphasizes the transformative power of integrating brand strategy with venture capital, enabling startups to build robust brand foundations that drive sustainable growth:

"Strategists deliver magic by understanding cultural tensions and creating brand value that financial models alone cannot achieve." [34:47]

James echoes this sentiment, underscoring the importance of embedding brand thinking from the outset to enhance company valuation and investor confidence [41:29].

Lessons Learned and Strategic Advice

Adrian Ho: The Importance of Focused Magic

Adrian advises strategists to maintain a sharp focus on their core competencies—creating transformative brand experiences—while respecting the expertise of other business functions:

"Our job is to give you some piece of magic that changes the landscape of what you're able to do." [44:35]

He cautions against overextending into areas outside strategic branding, which can dilute the impact and effectiveness of their contributions.

James Herman: Championing Long-Term Thinking

James advocates for a long-term perspective, noting that:

"Think long term because that's where all the biggest benefits and value come from." [45:52]

He highlights the limitations of the agency business model, which often prioritizes short-term gains over sustained growth, and champions a strategy that leverages compounding growth through sustained value creation [47:30].

Brent Vartin: Valuing Strategic Contributions

Brent emphasizes the critical role strategists play in venture environments, bridging the gap between financial objectives and brand-driven growth:

"Strategists know how to create brand value in a way that financial models alone cannot." [34:09]

He encourages strategists to view their work as integral to business transformation, enhancing both cultural and financial outcomes.

Conclusion: Expanding Horizons and Future Directions

Fergus O’Carroll wraps up the episode by highlighting the immense contributions of the guests and reiterating the potential for strategists to make significant impacts beyond traditional agency roles. He invites other planners who have made similar transitions to share their stories, setting the stage for future episodes that will continue to explore the evolving landscape of strategic roles in marketing and business.

---

Key Takeaways:

• Agency Limitations: Traditional agencies often restrict strategists to advertising-centric roles, limiting their broader business impact.
• Entrepreneurial Ventures: Transitioning to startups and venture capital allows strategists to embed brand strategy into the core of business operations, driving sustainable growth.
• Long-Term Value: Focusing on long-term brand equity and business transformation yields substantial financial and cultural benefits.
• Strategist’s Role: Strategists are invaluable in diagnosing and solving complex business problems, bridging the gap between creative branding and financial success.

Notable Quotes:

• James Herman at [03:41]: "If I could work with companies that are sort of like larger ad agency style clients, but I could help them create better products, then wouldn't that be nice?"
• Adrian Ho at [14:23]: "The skills that we have are so incredibly valuable at solving business problems."
• James Herman at [45:52]: "Think long term because that's where all the biggest benefits and value come from."

---

For those interested in the intersection of strategic planning, brand building, and entrepreneurial ventures, On Strategy Showcase offers invaluable insights and inspiring stories that transcend traditional agency boundaries.

Transcript

[Fergus O'Carroll]

Welcome to OnStrategy Showcase. I'm Fergus O'Carroll in Chicago. We're about to come. At least we're getting a little bit closer to the end of the year. We've had a great year at the show. I want to thank all of our supporters, all of our sponsors and all of you listeners for being a part of the year and making the show as successful that it has continued to become. We're looking forward to 2025 and a ton of great things coming up and a bunch of new announcements, I think, to come in early. It's been an interesting week in the world of strategy, in particular at the most senior levels. This past week, we've seen Martin Weigel, who's the Chief Strategy Officer at AMV BBDO in London, announced that he was resigning and he's starting his own consulting practice. And then literally a few days later, Martin Beverly and Richard Brim. Martin Beverly is the Chief Strategy Officer at Adam and Eve ddb and Richard Brim is the Chief Creative Officer at the same agency. They are leaving together to start a new venture in the new year. So a lot of things happening, and we're seeing this all over the US And I think in many parts of the world where very senior people are leaving, deciding to leave. I'm sure some of them are getting pushed out because of various reasons. I'm not suggesting that any of the guys I've just mentioned were, but I know of others that have been pushed out. But generally, I think there's a desire to get out and there's the desire to get out and explore new things. And so I was talking to James Herman, who's on the show today, and we were talking about doing an episode with a group of people who have begun that or have taken that leap and have stepped out and are doing it in different ways. We're actually going to turn this into a series and it's going to begin with today's episode and then we'll go out from there and begin to explore it with people doing different things. But that's going to be starting in January. But it's a really interesting topic because an awful lot of people like people in all jobs. We get very, very frustrated at times. We see where the scope of our thinking can be applied, but we feel very limited in how it's applied today. And we find that as idealists, because I do feel that strategists in their hearts are idealists and they can see a vision of how things can be. And then to be faced with the reality of what that has to be is very demotivating. It is very destructive, very disheartening as it is to anybody in the creative field or anybody who uses their brain to imagine, to design, to create, to then see how it has to be pulled back in. And so it can be very frustrating. And sometimes you get over it, you get a new assignment, you get re energized, but a lot of the time you just don't. And you're looking for ways to experience the joy of what might be. And so many people are stepping out to do their own thing. They've built up this amazing bedrock of knowledge, of experience, and they want to see how they want to apply it elsewhere. So we're going to begin this series with that in mind. And here is a clip from today's episode.

[James Herman]

My first sort of dream was if I could work with companies that are sort of like larger ad agency style clients, but I could help them create better products, then wouldn't that be nice? Because I think one thing that we all noticed in our advertising careers was client comes with problem, you diagnose problem, you figure out that it's not actually an advertising problem. But we're a bit stuck at that point. And if only the product was a bit better, then the advertising would work better and the business would go better. And so I wanted to sort of try and get into product innovation. And in sort of that first couple of years I discovered that two things. One, that large organizations are very, very bad at innovation and no matter how much you help them, they don't tend to get any better at it. But that startup companies are fantastic at innovation and you can help them in amazing ways that really do add a lot of value very quickly.

[Fergus O'Carroll]

So that's James Herman. James is a former agency guy planner, came out of Colenso BBDO down in Auckland, New Zealand. He has started a number of ventures. One is previously unavailable and his latest is a venture called New and Improved Ventures. And he, along with Adrian Ho, who is longtime founder of Zeus Jones in California, and Brandt Vartin, is managing partner of Bullock in New York. These are guys that have gone out and tried something and it has been working for them. Now there's a common theme amongst the three of these guys in terms of them being involved in venture and venture capital and working with startups. So we're going to be kind of leaning into that side of the options when you leave. Taking creativity, taking your ability to brand, taking your understanding of markets and marketing and then applying it to building something with somebody else or having ownership in it or building it and starting it yourself. We're going to be taking that angle today. Enjoy this one. It's a great conversation and let's see where this series goes as time moves on. If you're somebody who has made that leap and built something, we would love to hear from you. You can reach [e-mail] and maybe you'll find yourself on the next episode. So enjoy this conversation. James Herman, Adrian Ho and Brent Vartin. A lot of the feedback we get in the industry when we have these live shows. This particularly became an issue or underscored issue in New York when we were talking about the future of ideas. It's this issue of what business are we in? And it's the idea of people have different definitions of it. Some people say we're in the business of ideas. Some people say we're in the business of brand building. Some people say we're in the business of business building. And that's a fair summation of what we are in the business of when we're serving clients. But there's also the ability of planners, strategists, creatives in this industry to be able to apply their skill sets into other areas and working at building different things in different ways. So James Herman reached out and asked if we could do a show about this very topic. And it was kind of timely because these live shows have been stirring some, some sort of questions. So we've brought together these three guys who have each played a role in applying their skill sets outside of the agency world. All three of them are well known in the agency space, so it is brilliant to have all three of them here. Adrian, thanks for being here today. Appreciate having you on the show.

[Adrian Ho]

Thank you so much. I feel like, Felgus, you've created this sort of platform where I finally feel like I've made it because I'm finally on your show. So thank you.

[Fergus O'Carroll]

That's quite a compliment coming from Adrian. Your agency and your business has been around a long time and I think that we're thrilled to have you here. Brent Varden has been a part of the show in the past, but not directly. He's actually recommended some great people that we've had on the show. We'll talk about that later. But welcome back, Brent.

[Brent Vartin]

I am thrilled to be here. Thank you, James. Awesome idea. I'm, I'm thrilled to be on this podcast for the same reason Adrian is, but also both of these guys. Adrian, I've been a fan of for a long time, and I didn't know James, but I read a bunch of your stuff. So when we finally met, I was over the moon.

[James Herman]

So I'm.

[Brent Vartin]

I'm this and then been a fan of the podcast for a while. So I'm. I'm thrilled.

[Fergus O'Carroll]

Good.

[Adrian Ho]

Likewise, Brent. And as soon as I started finding out more about James, I realized how successful I really am as well.

[Fergus O'Carroll]

So, yeah, yeah, I want to go one. I want to go one job compared to James. So James Herman is here with us. James has been a longtime supporter of our show, and many of his businesses have been a part of it. And once again, we've had James on a number of different shows, all related, I believe most all, if not all, were related to marketing effectiveness and advertising effectiveness. So great to have James back on again.

[James Herman]

It's great to be back. Fergus. Thanks for organizing this. It's really exciting to. Yeah, just be able to connect and talk about something that's really close to my heart with a couple of others who are, I guess, of the same mind and experimenting in really interesting ways about how to take this sort of thinking that we all did in our advertising careers and apply it in new and interesting and valuable ways.

[Fergus O'Carroll]

And so to that, then, when you say of the same mind, what do you think that same mind is? The mind of what or the way of thinking? How would you define it?

[James Herman]

I think, like, I reckon that planning at its heart is about understanding problems really deeply. Right. When we can understand problems to a really kind of deep level, solving them becomes really easy. Right. And I think, you know, I think that naturally leads you into wanting to solve all kinds of problems that aren't just advertising ones. And what. I mean, I remember right back when I started in my career, I remember listening to, you know, leading planners around the world talk about how we should be involved in more than just advertising, that brands are more than just advertising. We should be involved, you know, further than just the sort of the advertising part, that we should be in the air of the CEO and be solving business problems, not just advertising and marketing problems, that we should be paid for the quality and the success of our ideas, not just for the hours that we worked. All of these sorts of things I listened to and as a really young planner thought, yeah, that's totally right. That really excites me. And I think still, 25 or so years later, still the planners in the industry are talking about the same problems. And I think it's really interesting to get a view from Adrian and Brent, who have Gone out and actually stopped talking about it and got down to the business of actually trying to solve those problems and trying to be a bigger influencer of business success and generate value in a way that's different to the kind of fee for services model that agencies are still stuck inside. So I just kind of, you know, I just have a lot of respect for people that, you know, talk for a minute and then get out and actually experiment and try new things and try to solve the problems that we've identified.

[Fergus O'Carroll]

Because I think almost the industry that we're in limits the way we have to think, because depending on what agency you're in, I always think that the agency you work for defines the type of planner you have to be now that. But in your heart, you might be somebody who's able to see across a much broader, broader horizon than just the world that your agency exists in. And, you know, for me, Adrian, it's this idea that as a planner, I think a good planner, when they're thinking through and developing a strategy, they can see it come to life. They can see it come to life everywhere, but they have a complete inability to control so much of that.

[Adrian Ho]

Yeah, well, obviously I 100% agree with everything that's just been said, but I would say that there were three kind of pivotal moments and they took place over, unfortunately, quite a long time that really cemented this for me. One was I was working on Microsoft back in 95. We ran all of their digital advertising and it was pretty clear that we were approaching it strictly from a communication standpoint. And it was obvious at that point, like, this is an interactive medium. We should be able to think about what we're doing in very different ways. But Microsoft were paying the agency 30 million in fee. So it was not a popular opinion at that point. But then fast forward back up till at Fallon, and there were two projects that really honestly sent me out the door. One of them was we pitched and won Sony their Walkman business. And it was an impossible brief, but basically they said, ipod's come out. We want to reclaim Walkman for Sony. And so we did an analysis and we found out that ipod had only about 11% penetration. And so there was 89% of people that just hadn't gone digital with their music. And so we were like, ah, Sony, you've got a studio, you've got this electronics. You could put this together and actually help people go digital, reconnect them to music, you know, be a solution. We won the business off of that insight. And then they fired us about six weeks later because we couldn't figure out how to deliver advertising that would reconnect people to music. Surprise, surprise. And then tell us about that.

[Fergus O'Carroll]

Why could you not? Because there you felt the objective was wrong. Or.

[Adrian Ho]

I think. And, you know, and this gets to. I think what you're going to probably hear is a very common thing, which is communications. Like, I'm not one of those people that thinks agencies don't, you know, have a place. But there are a limited set of things that you can solve with communications and trying to get, you know, a whole bunch of people who. And this audience were like, they loved music early on in their youth and just felt disconnected because it was so fragmented, so confusing. So there was a very sort of obvious strategy which was like, let's help you reconnect with the music of today. Let's get you more engaged in bands that you might want to listen to, just based on sort of the music that you would have liked in the past and stuff like that. But that's not an ad campaign platform, you know.

[Fergus O'Carroll]

Yeah.

[Adrian Ho]

And then I would say the final one, just sorry, to cut a long story short, was United Airlines, they gave us an impossible brief, which was like, drive business, full fare, business travelers back to the airline, just with advertising. We're not going to make any product. We don't have the money to make any product enhancements or service enhancements. It's just got to be advertising. And we actually launched a campaign that was based. Based on Rhapsody and Blue, and it worked, and we actually won a gold Effie for it. And then six months later, the client said, love what you've done with the work, but now we have enough money to actually invest in upgrades of the service. So we're going to put all the advertising on hiatus for a year.

[Fergus O'Carroll]

And so. And so for you, what did that symbolize to you as somebody in the industry?

[Adrian Ho]

I mean, I think it's what you're going to hear from these guys as well, which is like, the skills that we have are so incredibly valuable at solving business problems and trying to diagnose what's going on and how to potentially offer solutions or how to fix it. But if you're limited to, well, you can run an ad to solve it. There's just a very thin slice of problems that you can really solve. And that, honestly, was the inspiration for us starting Zeus, which was why we just wanted to be able to solve more interesting problems and a broader range of problems.

[Fergus O'Carroll]

So, Brent, for you, tell us about how you got to where you are today. Where'd you start out and how did you get to doing what you're doing?

[Brent Vartin]

I started out in media, but I started working probably three years into it, became an account planner and became a strategist. By the way, I love that we're using the word planner.

[Adrian Ho]

Let's bring it back.

[Brent Vartin]

I'm all in.

[Fergus O'Carroll]

I'm gonna make up. We'll make up another one. The third one.

[Brent Vartin]

Yeah. The world needs like planning, not just strategy. So I was a, I was a big student of it. I was never the smartest kid in the room, so. And you know, it's a craft that you can learn and you can follow people. And Adrian was ahead of me and he was on stages. I was like, what's that guy doing? You know, so like there's a lot, like it's a variant on Green James and stuff. But the, but there's all, there's all kinds of stuff that I was really getting attracted to. And I was learning the craft of asking why, unpacking and then learning the craft of all right, so then what? I eventually went to BBDO. The clients wanted 30 second ads. That's who was there. That's what was getting paid. That's so that's what you were kind of forced to make. And there was wonderful ideas that would come out.

[Fergus O'Carroll]

And in pre Lubar's days, that worked.

[Adrian Ho]

It did.

[Brent Vartin]

But like I was there like two years later, Lubars came and then and Han came and there was, you know, radical work coming out, but it was still very much communications work. And at that point I just started to get more and more attracted to Deutsch on both coasts. And I ended up going to Deutsch. And Deutsch was coming off a crazy six year run of agency of the year. Like bang, bang, bang, bang, bang. That place breathed business solutions on advertising solutions. So we were all. And it still had media. So you were always thinking kind of neutral in a neutral standpoint, but yet still most of the, most of the money was for advertising. And I just started to get to a place where I wanted to move further upstream. I wanted to have that freedom to be able to go look, everything is in play.

[Fergus O'Carroll]

Well, how would you define what Bullish is today?

[Brent Vartin]

Yeah, so we talk about it a lot as a marketing operating partner. Bullish is a one part venture capital firm with about $100 million of assets under management. And then it's one part brand agency where we have research, strategy, design and advertising in house. And it's a, it's a Little cute, but we work with startups or bigger companies trying to start something up. We're really good at that particularly or that. That particular life stage of a business. And sometimes it's at the. It's where there is no money. And we bring in checks of million dollars to $2 million, up to 3 sometimes. And we will help at the dirt stage. And what we'll do is we'll put brand strategy in at the gestational stages because we think when you bring the demand side in, your things will go farther, faster. And when you think more holistically about what that thing could be, then the advertising helps. There's an analyst sitting right next to a designer, who's sitting next to an account person, who's sitting next to a creative director. So there's a left brain. Anything happening here? That is awesome.

[Fergus O'Carroll]

It feels kind of like what Johnny Bauer did when he joined Blackstone, but it's a different scale. But it was the idea that you could bring brand strategy into the private equity and investment world and you could insert it at key points. I mean, Johnny Barra, when we were in New York, he talked about it as being. His thesis was that when a brand gets a major investment, when ownership changes, it's like the perfect, perfect time, James, for somebody to be inserted into that process, because that's when change is welcome. The startup owners are going to transition out. There's a new management crew coming in, the investment portfolio wants returns. It's like a perfect time for culture change. And that was his sort of perspective on how he could apply because it's tough to find the right time when a CEO is even open to this type of a conversation.

[James Herman]

Yeah, I mean, obviously. Yeah, I thought that was a really, really smart insight of Johnny's that particularly when you had the private equity organization saying, how do we take this company from paying 3 billion for it to selling it for 6? Right. Or how do we take it from the type of company that earns a certain multiple and transform it into the type of company that earns a much larger multiple? I think it was really cool. I think, like, transformation is really interesting. I think probably, certainly listening to Brent, where I'm at is I love the start of companies and being able to bake brand thinking into the absolute outset of that company and have that inform sort of everything that the company does, all the decisions that it makes, the types of people that it hires, the way it shows up and the product and the experience and all of that. When you're right at the start of A company, you've got just such an amazing ability to, you know, set the foundations in just the right way. And if you're an investor in that company, you're taken seriously when you, you know, when you go to do that because everyone knows that the, that the incentives are aligned, right? And I think that's, you know, when you ask Brent the question, why have these two things together? I think when you're an investor, you have a totally different conversation with the company around things like random marketing than if you're an agency and they believe in you as an investor. Like all you want as an invest is for them to grow, grow really helpfully and as quickly as possible. And so they kind of know that you're going to deploy your creative and strategic skills in the service of that rather than just trying to take money off them to do things, which I think is sometimes what the perception of agencies can be.

[Fergus O'Carroll]

We'll be right back. I'd like to share a report I recently read from Tracksuit and TikTok. The report proves what marketers have known for decades that performance and brand market achieve better business outcomes together. The report is titled the Awareness Advantage and it backs up a long held theory that having a stronger brand helps your performance marketing perform better. Specifically, high brand awareness advertisers drive 2.86 times more lower funnel conversions than lower awareness advertisers. What's more, if your brand is known by 4 out of 10 consumers, your performance marketing is 43% more effective. It's yet more evidence from Tracksuit to support the value of brand building and is a great resource for marketers trying to nail that tricky balance between performance and brand to get the most out of their advertising activity. You can download the Tracksuit and TikTok report. It's titled Awareness Advantage and you can download it for [e-mail] that's gotracksuit.com AwarenessAdvantage. And if you need a way to measure your brand health, such as your awareness, then Tracksuit is a beautiful, affordable and always on tool that tracks these fundamental metrics over time so you can prove the impact of marketing to business stakeholders.

[James Herman]

Hi there, my name's James Herman and I'm what's known as a distinctive asset which is something that makes people think immediately of a certain brand. Like the Golden Arches make people think of McDonald's or the swoosh makes people think of Nike. When the most effective marketing and advertising people hear me, they think of the master of advertising effectiveness brand. The master of advertising Effectiveness is a six week online program in partnership with Walk where I'll give you a next level understanding of how to make advertising that creates consistently better commercial results. One important ingredient is distinctive assets like me, me and me. Being here on this ad is one of the many reasons this campaign is the most effective advertising campaign in the world. Confused? You won't be when you become a master of advertising effectiveness. Get started at Mae Academy. That's Mae Academy.

[Fergus O'Carroll]

Now back to the show. So Adrian, the sort of, the frustration that a lot of people have, this idea that you've talked about earlier too is like my, my sort of aperture is limited by what my agency does, by what my clients want. You mentioned some frustrating points where you were like, it's almost like you were building up to a decision to jump out. What were you jumping out in order to create with Seuss Jones? It was what in terms of the palette and the services that it would offer?

[Adrian Ho]

Yeah, I mean, I think it's exactly what James was saying, which was like, we believe that rather than wrapping marketing around the outside of the a business that was already, you know, where all the decisions had already been made that we wanted to see if we could build marketing deeper into the heart of how that company operated. I think Brent said as well, you know, like, if you could make something remarkable, then the advertising is easy. So we were like just, you know, and honestly I would say it was a bit of a slog because we were, weren't super smart about how companies operated. And I think this is a problem for planners right now. But we just slowly kind of just said how can we help be more effective at a sort of start of decision making rather than at the end point of decision making. And, and I would say, and I know I've chatted with Brent about this, but sort of going into the venture world and kind of what James was saying, it's even a continuation of that idea which is like even going into companies and helping them think through operations and maybe even product design and sort of distribution design. What you started to realize was, well, there was a financial basis to all of the decision making that was driven by a set of investors on the board who just weren't going to see things in the way that you might be able to unless you were at that table. So I think that that's what we've been all trying to do probably is get a seat at the table where some of those real fundamental decisions about what the business is going to be like and how they're going to go to market are being made. And yeah, you're not going to win every conversation, but I just don't think the kinds of conversations we would have about a brand and creativity, they're not parts of conversations without us. I would say the humbling bit of me listening to Brent and listening to James is venture is a very, very complicated world. But in general there are people that are important, whether they're sort of incubators like I think James is, or lead invest like I think Brent and Bullish are. And then there's a bunch of small like value added hanger owners who are bringing a little bit of capital and some useful services to try and get themselves into deals that they otherwise would not belong into. So that's, that's where Zeus is and that's how we play in the early stage world.

[Brent Vartin]

You're way too humble, Adrian. You're way, way too humble. You're way too humble. From the minute we started talking about your guys move into venture, the value add is immense that you and your team bring.

[Adrian Ho]

Well, I mean it's all stolen from you, so it should be great, right?

[Fergus O'Carroll]

But Brent, tell us about the. I mean when you look at the revenue of your company, is most of it coming from the investment side or is it coming from the advisory side? Advisory meaning the brand side.

[Brent Vartin]

It's a great question. When we started, 90% of the revenues coming mean coming from the services side, you know, the agency side. We're now, we're now because of where the fund is and because of what where we've always wanted to be with the agency.

[Adrian Ho]

It's now 50 50.

[Fergus O'Carroll]

So James, for you, am I right in saying that most of your investments are in startups? Why the startups? What is it about that? Why not established brands?

[James Herman]

I love new things. I called the company previously unavailable because I love things that didn't exist before. So it's as simple a name as that. I think the ability to be involved in the creation of things, it's just so exciting. And so we in our company we invest in and work with a ton of startups that, that were not created by us. Then we have a kind of venture studio part of our business which creates companies like Tracksuit and ideally marketing technology companies. And then we have a couple of venture funds which are sort of semi sidecars to the venture studio business, but also invest more broadly than that particular business. And for me the kind of firstly I loved advertising and I still love advertising and so I do all of the effectiveness stuff because I really, you know, I Love advertising, what it can do, how great it is, when it is great. And so I certainly wasn't running from advertising. But I do remember thinking about, you know, when I was the head of planning at Colenso and I was thinking about the value of this, you know, at the time, 40 year old company and how it would be valued if it were to sell and it would, would have been valued at about, you know, somewhere similarly to the premium rum startup that we had created that I'd been part of creating, like back in 2010, which had a very, very different multiple and a very different kind of valuation. And I was just buzzed out at how, you know, you can sort of, as an agency, Trundle along for 40 years doing a really, really good job and never get to where you can if you start something kind of new that is in a different area of business where people look at the value of that business in a very different way. And so that's what sort of intrigued me about investment and about starting companies and being involved with these companies that grow very quickly and grow in value very quickly. And therefore, if you are an investor in those companies, you get rewarded for your ideas. Because if your ideas, your advice, your work is really good, those companies grow in value and that comes back to you. And so, so if you look at our, the P and L of our company and its balance sheet sort of combined, if we look at the amount that we spend running the company versus the amount that we've gotten back in terms of the returns on those investments and actual returns, not sort of holding value, but genuinely sort of cash out of those exits for the last 10 years. I just did the maths. And our kind of net profit is 50%. Right. So that's far higher than you would get in a traditional agency now. In the future it'll be far higher than 100%. Right. So if I look just at last year, it was about 300% or something like that. And so your ability to generate value far beyond the hours that you can work is there. And so that's really kind of solving that problem of how do we get paid for our value, not for our hours. This is how you do it.

[Fergus O'Carroll]

So it's interesting because. Sorry, go ahead.

[Adrian Ho]

Well, I just wanted to reiterate kind of because I think this might help some of the people in traditional planning. Our job, if you break it down right, our job is creating deep, emotional, sticky relationships between companies and their customers and trying to figure out how to align a company with growing culture that is going to Fuel it along and make it larger. Like ad agencies, they would measure that on a brand tracker and they go, well, don't done in an early stage company that is many, many multiples of market size larger. And that is really sort of one of the big ahas here, which is we're really devaluing the, just by lumping it with advertising, we're incredibly devaluing the skills that we have because they are the absolute most important skills for most companies, you know, outside of the technical and scientific stuff that they might have to do.

[Fergus O'Carroll]

Can I jump on that, please?

[Brent Vartin]

I think, I think like when you come into, when you come into venture, when you come into this side, there's a, there's, there is, you know, you, everybody who comes into this smartly is like, okay, cool. Like we're getting in close to finance.

[Adrian Ho]

Holy.

[Brent Vartin]

The stuff that strategists can do is incredibly valuable. And I think one of the big, big mistakes that happens is it's like all those people know the numbers and they deal with financial models and like they literally have their hand on the money. Like, oh, whatever they say goes. You know, part of what you're also doing with respect and be very smart about it is you are delivering magic to them. How cultural tensions emerge, how people make decisions, how brand value is created.

[James Herman]

It.

[Brent Vartin]

They know what they want, they do not know how to do that. And you do.

[Fergus O'Carroll]

My guess is though that if you're a planner who's trying to get into the world of assisting startups and maybe a level of investment in that, that you need to be more than that. You need to be more than what a planner is. You need to have either a passion for an extra dimension of business that's outside of the concept of brands and you, you really need to understand the business in order to be able to have conversations, James. Because, you know, there's, there's, as you know. Well, there's a, there's the majority of people, in my opinion that's an opinion only that actually think that brand isn't really even needed at the start. That it's product centered.

[James Herman]

Yeah, absolutely. And we've been, you know, I've personally been fighting that battle and actually winning because once you. I think this is another thing about planners is we're pretty good at learning new stuff, right? And for me, you know, it wasn't that I dropped out of advertising and went straight into the startup community and was immediately embraced at all when I left the advertising agency world, you know, I was pretty well known within that kind of Little tiny little world. When I went into startup, people were like, I don't know who you are. Frankly, I don't care a brand advertising. No thank you. And so it took actually a few years of really listening to that community, how it works, what it needed, and then doing, you know, just starting to do some work that did start to change the dial and earn the respect and earn the faith of that community so that they would entrust me and my people with brands that they were, were pouring really significant money into that they wanted to be really capital efficient, especially in the early stages. They're not splashing money around on kind of agencies and branding consultants and people like that at all. And so you've got to really kind of start and listen and understand what the needs are of the VC and the startup world and then sort of solve for that. Orient yourself in a way that you communicate to them and you work with them in a way that achieves what's important to them. Them and VCs are great because they like, like they are really smart and they're happy to listen to anything that's going to increase the value of their companies so you can show up and talk to them about brand. And, and this is what my book Future Demand is, is, is really all based on. How am I going to communicate the value of brand to a venture capital partner who is, you know, who is skeptical of brand, brand doesn't have a very good brand, and who, and who is thinking purely in financial terms. And so it of relanguaging stuff to talk to that market better and focusing on the types of work that genuinely do increase the value of the organization. And that's something that you sort of have to, once you leap out of advertising, you have to spend some time learning that craft and learning that industry before you'll be taken seriously by it. But you have to start right? We have to start somewhere. We can't just, if we're, if we're wanting to really change the game, we can't just stay in the agency planning television commercials. If we love that, we totally should stay in the agency doing that because that's a really, it's a great job and it's an important part of the puzzle. But for any planner that's interested in going further beyond that kind of world, you do sort of need to take yourself back to zero and go on a learning process. And I can tell you it's a really rewarding one.

[Fergus O'Carroll]

So how, where did, what was the first step you took?

[James Herman]

I mean it was probably Quite similar to Adrian at the beginning where my first sort of dream. If I could work with companies that are sort of like larger ad agency style clients but I could help them create better products, then wouldn't that be nice? Because I think one thing that we all noticed in our advertising careers was client comes with problem, you diagnose problem, you figure out that it's not actually an advertising problem. But we're a bit stuck at that point. And if only the product was a bit better then the advertising would work better and the business would go better. And so I wanted to sort of try and get into product innovation sort of. That first couple of years I discovered that two things, one, that large organizations are very, very bad at innovation and no matter how much you help them, they don't tend to get any better at it. But that startup companies are fantastic at innovation and you can help them in amazing ways that really do add a lot of value very quickly. And so that was the genesis really kind of realizing where all the real value could be created was more in those early stage companies than in the big ones.

[Fergus O'Carroll]

So it was like you went into sort of building a sort of a consultancy that led you then over time to be able to contribute to startups both financially and with your own expertise. And then it just snowballs over time.

[James Herman]

Yeah, and then we sort of just figured out like, you know, we can't charge like the fees that we need to run the business to a tiny startup so we need to think of a different way of working with them. And so, you know, using, you know, in any kind of services company you've usually got a little bit of time left over at the end of the month if you're running a good ship. And so what if we put trade that time for equity. And so we started with like a, a really interesting CPG company. We did about, I don't know, it must have been like 20 grands worth of work for them which we traded for equity that's now worth about $600,000. And, and, and we kind of got busy on making a difference to that company and we continued to do those small things. And then Ven started to notice and say, hey, something's happening here. All of the companies that you're invested in seem to be performing really well. And then they start to sort of trust us and go what are you doing here? And maybe we should send more of our portfolio companies to you for you to sort of help them, help them out.

[Fergus O'Carroll]

You know, Ritson will talk about the four P'S a lot. And so the four P's is sort of his way of sort of criticizing the narrowness of which agencies currently work within your. Your reality in working for actual businesses versus my reality, which was just working on the agency comm. Side of our brand. What is the reality in terms of what we can influence and what we can't?

[James Herman]

Yeah. So I think certainly from our point of view previously, we get to work on all four P's. Now, how those are the. Then who those P's are then assigned to within the organization can sometimes be a little different. So sometimes it is the marketing person, the CMO in the organization is really just responsible for the promotional P and others are responsible for the place and the price and the product. But I think when you can set it up in a way that it's well understood how those four Ps feed into each other within the organization, then you give even a promotionally focused marketer more of a voice. Right. And more of an ability to contribute constructively to the other P's, which is, which is, you know, which makes life much more enjoyable for them and also set the organization up to have a, to put a value on marketing that they may not have, you know, prior.

[Fergus O'Carroll]

Is there anything you'd add to that, Adrian?

[Adrian Ho]

Well, and this sort of refers back to something that James was going to say, was saying earlier. I think it's really interesting for planners who've been mostly in agencies to sort of step outside because I would 100% agree. You've got to have and develop a better sense of what's happening around the rest of the organization and honestly, how complex it is. Running a business is very, very challenging. I mean, this is why startups, most of them fail, because it's really difficult and you've got to be really excellent in so many different areas. So I think planners need to figure that out. They need to do a better job of listening and really understanding it. But then I would also say that conversely, what we can do is we can bring something that is transformative. We can create this brand that just changes the entire landscape for that business. Business. And what I sometimes see planners who stepped out of agencies do is they go in and they try and get their hands deep into every single part of the business and they kind of meddle in places where frankly, there's other people that are better doing it instead of going, I want to understand that landscape. But actually my job is to give you some piece of magic that maybe takes the pressure off of your sales or your distribution. Or other things that just changes the landscape of what you're able to do. So I think it's like, yeah, to me, it's this challenge of breadth of perspective, but it's still that narrow, sharp focus on, like, that's what we do. I love what Brent said. It is magic. I mean, literally, there's the only thing that outside of, you know, it defies logic. You can create an idea that just transforms how people think about their company, and no one else in the organization can do that.

[Fergus O'Carroll]

What have you learned about yourself over the years? I mean, when you look back, what have you learned about yourself and your strengths or your weaknesses since then?

[Adrian Ho]

You know, it's funny, I was having this sort of a version of this conversation with James when we were chatting, which was like, I have actually come back around, honestly, to recognizing, like, how incredible plan learning is as an education and how vital it is as an industry and how I feel that we have a. I feel like I have a responsibility to see if I can, you know, help in some ways, because it is the same conversation that's going on when we all left. Nothing has changed. Why won't my creative listen to me? I mean, it's like, you know, so I. I think what I've learned is like, just a deep appreciation of what we were given in terms of a skill set. And, yeah, kind of like, I wish we could do more to kind of grow a next generation of planners or help the next generation of planners, you know, figure out, like, don't give up, you know, keep on going. Because this is super important.

[James Herman]

My big learning is about the power of the long term. Right. And so in the agency world, you know, advertising does tend to be pretty ephemeral, and we are sort of focused on the here and now. The agency business model works on a standard sort of, you know, annual P and L basis. And so you're trying to engineer the business to make as much profit as it possibly can within this year. And so your ability to genuinely think really long term is really held back. And I was really, really inspired by that Bill Gates quote. We overestimate what we can achieve in a year, and we underestimate what we can achieve in 10 years. I think that is really. That's an amazing insight. Right. And when we give ourselves the ability to think much more long term. So, you know, when we are involved with a company, we're not thinking about how it's going to do next year, we're thinking about how it's going to exit in 10 years. And so the power of that is enormous. And the power of compounding growth, not just financially, but personally as well. What did Einstein say? Compounding interest is the eighth wonder of the world, or whatever it was. But the ability to go long, think long, plan long, the outcomes, when you get to the end of it, are amazing, absolutely amazing. And so I think I'm just a huge proponent for thinking long term, but also setting yourself up so you genuinely can act long term, because long term is where all, all the biggest benefits and value come from.

[Fergus O'Carroll]

It's Adrian Ho, co founder and chairman of Zeus Jones. You can connect with Adrian through LinkedIn or on our website. Brent Vartin is managing partner at Bullish in New York. And James Herman is founding partner at Previously Unavailable, as well as co founder of Tracksuit, also of the Master of Effectiveness Program, which is a terrific program that we are huge fans of and is a supporter of our show here and also an investment committee member for a number of different funds. It just keeps going on with you, James. There's just so much stuff here. I don't know how you even do you find time to sleep at night. I don't know how you do it, but brilliant to have the three of you on here. A great conversation. Thank you all for being, being a part of it.

[James Herman]

Thanks so much.

[Brent Vartin]

Thank you so much for taking us. It's great, really fun.

[Fergus O'Carroll]

And we will see everyone on the next episode.