Stagwell—Ad Age Agency Report 2024

Stagwell is an agency company based in New York. The company took its current form in August 2021 when MDC Partners, an agency company, combined with The Stagwell Group, which had holdings in new media and digital marketing services. At that point, MDC changed its name to Stagwell Inc. See Stagwell’s financial reports. More from Ad Age Agency Report 2024 Big picture: State of the agency business World’s biggest agency companies Agency listings Agency revenue growth Agency company revenue by client sector Stagwell served more than 4,000 clients as of year-end 2023, according to its annual regulatory filing. Stagwell said its 10 largest clients by revenue accounted for about 22% of worldwide revenue in 2023; 20% in 2022; 17% in 2021; and 35% in 2020. Stagwell’s annual filing for calendar 2023 said: “No sales to an individual client accounted for more than 4% of revenue for the years ended December 31, 2023 and 2022.” That represented a revision for 2022 vs. what Stagwell’s annual filing for 2022 said: “No sales to an individual client accounted for more than 7% of revenue for the years ended December 31, 2022, 2021, and 2020.” Stagwell’s filing for calendar 2023 said: “Historically, client concentration has increased during election years due to the cyclical nature of our advocacy brands.” Stagwell Inc. was formed Aug. 2, 2021, through a merger of Stagwell Marketing Group and MDC Partners. Upon completion of the merger, Stagwell took control of MDC through a reverse merger. At that point, MDC changed its name to Stagwell Inc. (Nasdaq: STGW). Stagwell’s March 2, 2023, earnings release explained: “The acquisition of MDC Partners by Stagwell Marketing Group (SMG) was completed on August 2, 2021.” Before the merger, Stagwell (operating as The Stagwell Group) had been MDC’s largest shareholder. MDC was the parent of agencies including Anomaly, CPB (now Crispin), Doner and 72andSunny. The Stagwell Group’s holdings included digital creative shop Code and Theory, communications firm Sloane & Co. and digital agency Targeted Victory. Existing MDC common shareholders (including Stagwell) ended up with about 31% of the common equity of the combined company immediately following the closing of the transaction in August 2021 (excluding the effect of converting outstanding MDC preference shares into common stock). In the merger with MDC, Stagwell Media LP contributed its interest in Stagwell Marketing Group LLC to the merged company. Stagwell Media received about 69% of voting rights in the combined company (excluding Stagwell’s ownership in the combined company derived from its ownership of MDC shares before the merger and excluding the effect of converting outstanding MDC preference shares into common stock) for contributing its businesses in return for newly issued MDC shares. As of Dec. 31, 2023, Stagwell Media beneficially owned approximately 56% of Stagwell Inc.’s shares of Class A common stock on an as-converted basis, according to a Stagwell Inc. 10-K filing. Stagwell first invested in MDC in March 2019, when Stagwell Media invested $100 million in MDC by purchasing $50 million in MDC common shares and $50 million in non-voting convertible preference shares. As part of the deal, Mark Penn, Stagwell’s managing partner, joined MDC as CEO and a board member. Stagwell said it had approximately 10,250 full-time employees and approximately 2,750 contractors and part-time employees—a total of 13,000 people worldwide—at year-end 2023. Stagwell said it had approximately 11,100 full-time employees and approximately 1,050 contractors—or a total of 12,150 people worldwide—at year-end 2022. Stagwell said it had approximately 9,100 full-time employees and approximately 1,100 contractors—or a total of 10,200 people worldwide—at year-end 2021. Mark Penn is Stagwell’s chairman-CEO. Penn became CEO of predecessor MDC Partners on March 18, 2019, and was named chairman effective April 18, 2019. Stagwell’s ticker: STGW Mark Penn founded The Stagwell Group in June 2015. Before starting Stagwell, Penn held senior executive positions at Microsoft Corp. including oversight of its $2 billion advertising budget, and at WPP. MDC Partners was formed in Canada on Dec. 19, 1986. Effective that day, the company combined with Branbury Explorations Ltd., a move that made MDC a public company. The Stagwell Group and MDC Partners merged Aug. 2, 2021. At that point, MDC changed its name to Stagwell Inc. “Stagwell, the newest global marketing services company, was built to stand out from the start: a challenger network built to transform marketing. “Since our inception in 2021, we’ve been building an organization that’s differentiated from the decades-old legacy holding companies by our digital transformation expertise and non-competitive approach to integrated, collaborative work—and the industry has taken notice. “In 2022, we rode on the tailwinds of a rebounding economy, with six consecutive quarters of growth; in 2023, we weathered market headwinds in the ‘year of efficiency,’ focusing our growth on strategic organizational changes and investments that complement our existing services, arming us with greater capabilities and the ability to scale: in size, into new regions and across industry verticals. “We made big bets like the launch of Sport Beach, the most talked-about event at Cannes Lions; partnering with Google Cloud to develop marketing-focused generative AI products via the Stagwell Marketing Cloud, our proprietary suite of SaaS products; expanded our footprint globally with acquisitions, new leadership and new affiliate partners in Vietnam and Brazil—including the establishment of our LATAM regional hub in São Paulo; and invested in leader-driven businesses via four acquisitions to propel us forward. “Our focus on digital transformation has never wavered and we’re bullish on the opportunities of 2024 as we carve out our leadership in building the marketing technology and immersive experiences driving the brands of tomorrow.” Ad Age Agency Report 2024 Revenue and analysis for agency companies Click here

Stagwell—Ad Age Agency Report 2024

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