St. Luke's founder quits as agency faces a new reality

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St. Luke's founder and Chairman Andy Law quit last week after weeks of debate over the future growth-in the U.K. and internationally-of the London shop started eight years ago as a creative cooperative owned by its entire staff.

Practicing "hot desking" in an open-plan ex-toffee factory, St. Luke's quickly became the city's most talked-about agency. Everyone knew about its idealistic lack of hierarchy, wacky creative ideas and the elaborately decorated Brand Rooms each client had at the agency to hold meetings or simply hang out.

But a new era is upon the agency. "The focus now is on trying to apply the radical thinking St. Luke's has always had with a sense of pragmatism and business rather than just be the weird-ideas people," said Neil Henderson, the shop's joint managing director. "It's a new place for St. Luke's."

Since last April, the shop has been run day-to-day by Mr. Henderson, former client-services director, and the other joint managing director, Phil Teer, who is also the planning director.

During that time, Mr. Law became involved in Artist Network, an ambitious venture with musician Dave Stewart (of Eurythmics fame) and others to bring together music, film, TV and art talents in a single company that has largely fizzled out. Then he turned his attention back to St. Luke's.

"We debated long and hard," Mr. Henderson said. "We're all shareholders and we all get pretty heated."

The new management is more conservative, for instance, about international expansion, particularly to the U.S. Until now St. Luke's eccentric international development, spearheaded by Mr. Law, has consisted of opening tiny offices in India last fall and Sweden two years ago.

conservative plans

"We need to do it very carefully and find the right opportunity," Mr. Henderson said. "America is something we talk about but we don't have firm plans. "

In London, St. Luke's has a staff of 95 and billings of about $100 million. Clients include Travelocity and U.K. telecom giant BT. The agency also has "co-ownership" stakes in related shops like digital agency Glue and the Kitchen, a retail agency.

Contemplating life after St. Luke's, Mr. Law said he has a vision that will be revealed in his second book, "Experiments at Work," to be published in the U.K. next week. His first book, "Open Minds," chronicled the early days of St. Luke's after the fledgling Chiat/Day outpost he managed was ordered to merge with TBWA Worldwide's London office following Omnicom Group's acquisition of Chiat/Day. Mr. Law refused, and dumbfounded Omnicom by opening St. Luke's with the staff and clients from Chiat/Day in London.

"The big test will be for [St. Luke's] to grow without its dad," Mr. Law said. As far as his own future, he said, "the new book is full of clues."

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