GOOD CEOs: Issue 8

Forgetfulness
is considered to be
a weakness.

But did you know that your leaky memory – that is incapable of recalling what happened to you on a specific day in March – is actually a function rather than a bug?

Neuroscientists reckon that our brains automatically filter out the useless, mundane mental material to preserve the stuff that helps us learn or grow. Which means being able to remember well is also about being able to forget well.

No: we don’t remember days, hours or years very clearly – if at all.

Instead: we remember emotions, feelings, people…

Moments.

I’m opening this issue by talking about moments, because we’ve just wrapped our first season of GOOD CEOs. And it was full of these instants where a sudden revelation takes place. Each one has lodged in my memory, and I’ve found myself regularly repeating things from our interview episodes.

• Toby Southgate’s predictions on the future of the holding co

• Laura Tannenbaum’s model for incredible agency growth

• Alex Lubar’s emphasis on balance and vision

• Leland Maschmeyer’s artful approach to pricing

Each conversation featured several moments of powerful, undeniable, shattering truth. They were so valuable (and memorable) that I wanted to recap on them here.

Plus! Season Two gets underway next week

After that, we’ll give you a little taster of what we have planned for season two – which gets underway next week.

MOMENT ONE
Toby Southgate, Global CEO, We Are Social

Indy agencies are where it’s at.

Toby was the first creative leader to sit down with us this year. He gave us a wide-ranging, far-looking POV on what’s likely to happen in holding co. land in the coming months. He expects a slimming down in the number of big marketing and advertising multinationals (the big six will become the big three). But the moment that got us most excited was when he turned his attention to the outlook for indy agencies.

“Great companies stay great through hiring and retaining the best people. That’s just a fact. Right now, these people are gravitating towards independent agencies that value creativity. They get freedom, they get scope, they have to answer to fewer people. These companies can turn quickly,” he said. “Properly scaled, fully independent, creatively orientated businesses are able to magnetise the best talent around.”

Supreme creative talent, and brand clients who are getting tired of the big network rigmarole. Toby reckons that indy agencies are in the midst of a major growth spurt. “There will be some upsides for smaller and independent agencies. They will find themselves getting into rooms with bigger clients. And client side, pitch lists will feature a more varied set of agency names.”

Mic drop moment:

“The first £1 billion
independent holding company
will emerge in 2026.”

💨
🎤

I wonder if Mr. Southgate knew something we didn’t? 🙃

MOMENT TWO
Laura Tannenbaum, CEO, Fabric Social

The rules to grow by.

We have followed Laura’s meteoric rise from helping scale one of the world’s first social-first agencies, That Lot – to building Fabric Social into a business appealing enough for a buy-out by Publicis Groupe UK. The most arresting moment for us during her interview was when we learned about the rate of growth she’d instigated at Fabric Social.

In the year (and a bit) that Laura has been leading the company, it’s seen a 300% year-on-year upsurge. For an agency model, 20% is very good, 40% is incredible. We don’t have a word for whatever 300% is (although, if you asked the folk at Publicis Groupe UK, they’d probably use the phrase ‘acquirable’).

How did she do it?

Firstly: Operational foundations. “I know it sounds boring, but it’s so important,” she says. “Fabric Social was quick and scrappy startup vibes - amazing and super fun. But if you're growing super quickly, that will not scale. It will break. So better processes, better visibility over the data points that you need to be able to make better decisions.”

Secondly: Non-negotiables. “Being really clear about who we are, what we're trying to do, what we're trying to achieve. The principles that inform the path of say, what's the right client for us? What are we in the business of? getting all those answers right encourages alignment, speed, effectiveness.”

Thirdly: Momentum. “I think I've been incredibly lucky because Fabric Social was already on a great path. There was a clear ambition that we've sort of stuck with. There was no ripping up and starting again. I don’t need to crack the whip. At least, not too much.”

Mic drop moment: 

“Our CAGR
has been 300%
year-on-year.”

💨
🎤

 Yep. 

MOMENT THREE
Alex Lubar, CEO, FundamentalCo

Balance and vision are key to growth 

He ran one of the biggest ad agencies on Earth, then he left. Alex Lubar was Global CEO of DDB. Now at FundamentalCo, the strategy consultancy carved out of Blackstone. How does a running a famous company of some 8k people compare with scaling an upstart of around fifty? There are two things leaders should bear in mind: balance and vision.

On balance: Creative agency CEOs often overlook how simple their time allocation should be. Alex has a straightforward formula that helped him keep his attention and talent trained on where it should be: “A creative agency CEO should be spending sixty percent of their time with clients – or more,” he told me. “They should set aside twenty percent of the rest for operations, then the final twenty should be kept aside to lean into any issues that come up with the pace and complexity of running a business of this kind. The reality is, especially in a legacy organisation, the operational component can spike up into the sixties or eighties.”

On vision: The importance of far-sightedness can’t be overstated, according to Alex. It’s imperative to be part of an organisation that has a clear view of where it’s going: “Make sure that you're part of an organisation that has a vision of what the future looks like. And is not just looking at the business through the lens of creating efficiencies, but of innovation and creating something that’s new,” he says. “As long as you're part of a group that is embracing change and the excitement of change, then it could be fine. And is my talent focused on the things that I care about and the things that I think will drive the business?

Mic drop moment: 

“You really have to ask:
Does that vision exist
in the organisation?” 

💨
🎤

MOMENT FOUR
Leland Maschmeyer, CEO, COLLINS

Pricing is a creative act

Leland brings a designer’s discipline to his role leading COLLINS. The most revelatory moment in our interview came when he revealed his thinking to do with pricing. While most people assume that pricing is about the empirical stuff – time, materials, overheads, and maths. Leland flips the idea, making the argument that pricing client work is a creative rather than a logical act. Here’s how he puts it.

“Pricing is not math. Pricing is not finance. Pricing is a creative act. It is a creative discipline. It’s fundamentally the understanding of value and an exchange so value can be captured. So it’s about value communication, delivery and capture,” he says. “Value communication is what a lot of creative industries have traditionally been tied to because of the nature of distribution and the nature of media. But it's ultimately communicating the value of something.”

Leland asks about the difference between the ritual of yoga, versus the physical act of stretching: “A client’s willingness to pay is anchored on the perceived value of what you're going to buy. So, what's the difference between stretching and yoga, for example?” he asks. “It’s basically the same thing. It’s a heated room, some exotic language around it, maybe some incense burning in the corner, but you're basically stretching. Fundamentally, it's the same thing, but yet people pay a ton of money to go to yoga. If you change the context, you change the set of the price – you change the understanding of what something costs.”

Mic drop moment: 

“There is no monolithic
approach to pricing – just like
there’s no one way to build
a brand. It’s more of an art
than a science.”

💨
🎤

Season scaling

You may have noticed there has been a flood of private equity money in the creative industries.

You may have noticed that there has been a flood of holding companies figuring out where they are and where they're going.

You may have noticed there is a flood of brands looking to work in different ways. And so therefore, we are seeing a flood of different independents, killing it, starting up: thriving. 

It made me think – if I was starting or scaling a company right now, what do I feel like I've not been told? What information has been kept from me as a growing CEO or founder?

If you’re in the creative industries, there’s one word.
 

 
 
Capital.
 
 

 
Creativity and capital have an awkward relationship. With the worlds of the imagination and finance industries inhabiting two different worlds. So that’s what season two is going to be all about. Exploring the intersection of these two spheres, and looking at how they can learn from, and interact with each other in ways that drive growth (in both).