Bill Koenigsberg, CEO and founder of U.S. independent agency giant Horizon, has inked a deal that in one fell swoop creates a new media agency, brings in a massive automotive account, expands his shop's reach globally and lays the groundwork for a new network.
Horizon is doing a joint venture with Hyundai-backed agency group Innocean to launch a separate standalone media agency called Canvas Worldwide. The first client will be the nearly $700 million U.S. media business for Hyundai Motor Group's U.S. brands, including both Kia Motors America and Hyundai Motor America. Interpublic Group of Cos.' Initiative currently supports the account.
"I'm interested in building out a new entity. I think there's enormous white space here," said Mr. Koenigsberg. "The $26 billion that's up for review now in the market -- I believe that's pointing to the fact that the old models are broken. Marketers are looking for a clean slate, new opportunity for invention, new creativity. I believe that with the success I've had with Horizon I can build another entity with a strong global partner to create two of the best-in-class agencies in the world."
Hyundai Motor America indicated as much in a statement. "Canvas will bring a new, entrepreneurial team that is not associated with any media holding company, providing independent thought and action. Canvas will be inventing a new future in the media world, while using all of Horizon's known strengths to function at full effectiveness from the moment it begins working for Hyundai Motor America in January, 2016. The independent nature of Canvas is a perfect fit for the bold, entrepreneurial nature of Hyundai."
The automaker also referenced the new media agency's transparent buying model as a main selling point at a time when there's a lot of debate around buying. "Hyundai has been impressed by Horizon's existing ability to offer fully a transparent system for media buys and understands this will be a key component of the Canvas philosophy," the company said in its statement. "This transparency, and the accountability that goes with it, are critical to HMA."
The move follows years of speculation about the future of Horizon, the last-standing, large independent media agency in the U.S, and indicates that a sale is not in the cards in the near future as Mr. Koenigsberg builds his new network. He declined to comment on an eventual sale.
The new joint venture also furthers Innocean's goals for growth. The company, which was started by Hyundai over a decade ago and completed its initial public offering in Seoul last month, said that it would take 134 billion won from the 340 billion won it raised from its IPO and use it to expand and diversify its client base beyond Hyundai, according to numerous reports in publications like Reuters and Businessweek.