Richard Kirshenbaum, CEO of Swat Advertising—formerly NSG/Swat—has always had an entrepreneurial spirit, working with startups and small businesses and even co-founding Blackwell Fine Jamaican Rum. Now, the business mogul has gone a step further by launching a venture capital firm named Swat Equity Partners.
Despite sharing a name, the advertising and venture businesses are two completely separate companies with different P&Ls, says Kirshenbaum. The equity firm's fund of about $12 million focuses exclusively on consumer brands and their founders. Its current investment portfolio includes Supergoop, Naadam, Guideboat Company, Banza and Powerful Yogurt.
Even though the two businesses act independently, Kirshenbaum says Swat Equity is "aggregating some interesting institutional knowledge about what's happening in the marketplace right now," which can be used to help clients at Swat Advertising.
Other leaders at Swat Equity include senior advisor Mark Hauser, managing director Sarah Foley and Brian S. Riordan, president of Swat Advertising. Swat Equity has been in the works for about three years, but the partners were not allowed to talk publicly about the firm until all money was raised and it had FCC approval.
According to JC Uva, managing director at MediaLink who leads the investor strategy specialty, the "agencies that invest capital in early-stage brands provide a built-in advantage because their core business, brand building, is an essential ingredient for success in many of these consumer-facing startups.
"If the brand grows substantially as a result, agencies come out the other side with a case study that can be very compelling," Uva continues.
Swat Advertising itself has a rather unique model. Since its inception in 2011, Kirshenbaum says the agency has never competed in a pitch. "We will not do it," he says, "and people like the idea that we won't pitch. It's a huge waste of time and money."
For some clients, Swat Advertising takes a reduced fee for equity in its company, such as membership-based private aviation company Wheels Up and Master & Dynamic luxury headphones.
Kirshenbaum declined to disclose revenue for Swat Advertising since it's not a public company, but he says the agency has tripled in revenue in the last four months and has added 12 staffers, bringing the headcount up to 28.
Some recent new business that has helped propel Swat Advertising this year include repositioning and leading strategy for Venus Williams' apparel brand, Eleven