From the seemingly never-ending parade of small shops popping up in the U.S. and abroad, to the infiltration of technology into the business world, to the fluid definition of “chief marketing officer,” boutique agencies have a lot to contend with—and contend against—in 2021.

This combination of pressures has been so great for some in the industry that agency founders and principals have opted to sell or merge their businesses, which is not an easy conclusion to reach for any creative. But with small agency leaders likely grappling with the “to sell or not to sell” question now more than ever, it’s worth asking: How do you know if the time is right?

“There’s never going to be a perfect time, there’s just going to be a better time,” Mark McQuillan, founder and managing director of Jam3, said during a panel discussion on the topic this week at Ad Age's Small Agency Conference & Awards. Jam3 merged with S4 Capital’s MediaMonks in March of this year. (As further evidence of mergers’ ubiquity, MediaMonks is one with MightyHive as of Tuesday, forming a combined entity now stylized as Media.Monks.)

For McQuillan, one of the most pressing factors that led to the merger of his international hotshop was the varying needs of his co-founders and partners, underscored by the long-term goal to create as much opportunity for as many employees as possible—something that a merger could help facilitate with competition for work being at an all-time high.

See all the winners of Ad Age's 2021 Small Agency Awards here.

Being a small agency in 2021 is “like you’re a dog in the alley fighting for scraps, and the dogs keep getting bigger, and the dogs keep getting more numerous. And then there are small ones, and then there are ones that don’t even look like dogs anymore,” says Tracy Wong, co-founder and chief creative officer of WongDoody. An independent shop for more than two decades, Wong and CEO Ben Wiener made the call in 2018 to sell their Seattle-based business to Indian technology and consulting firm Infosys—not exactly the kind of group that typically acquires creative agencies, but a partnership that Wong nevertheless recalls being a “very deliberate decision.”

As a founder, after answering the question of whether or not to sell your small agency, the next most important question is who you should sell to. In WongDoody’s case, Wong knew he wanted to make a move with a firm that could “diversify our business,” which ruled out the most traditional route of selling to a massive holding company.

“I didn’t want to have to fight within our own network for more scraps,” he says of his choice to ink a deal with Infosys, which previously had no such creative branch in its portfolio.

Holding companies aren’t necessarily the boogeymen of Small Agency Land, out to gut boutique shops and revamp them in an unrecognizable way; in fact, the WPPs and Omnicoms of the creative world are often the most logical choice for indie agencies looking to take themselves to the next level.

For Roger Camp, chief creative officer and partial namesake of award-winning small agency Camp + King, doing business with a holding company made the most sense out of every available option. Camp and CEO Jamie King sold a majority stake in the now-former indie shop late last year to Havas, which he notes had already had a minority interest in it for the previous decade. “We really knew who we were getting in bed with,” Camp says.

“[Havas] brought a lot that we were lacking,” he adds, citing benefits from having access to Universal Music Group’s library to boosting its own media production capabilities, which now give Camp + King a leg-up on pitches for new business. “So many pieces and parts they’ve been able to bring to us that we wouldn’t have on our own.”

“We’re small agencies, we’re always going to be faking it until we make it,” Camp continues.

No matter what larger business an independent agency merges with or gets sold to, a critical consideration is how any given shop will retain its internal culture and personality—often sticking out as boutique agencies’ most defining element in an increasingly crowded industry.

“We were super concerned; many sleepless nights leading up to the announcement” of Jam3’s merger with Media.Monks, says McQuillan. But for him and his fellow executives, the bottom line of the deal was that it could provide more opportunity for more people faster than the shop alone could’ve done.

“Does it mean it might challenge some of our values? Yes,” he says, but adds that Jam3 has always upheld the ideal of the “relentless pursuit of better” and won’t be foregoing any of its workplace culture as a result of the merger.

“Jam3 was never perfect. It’s always in a state of flux, state of improvement, and that doesn’t change,” McQuillan says. “People are going to see on the outside that the team colors have changed, but from the inside, we’re still going to act the way we act, make decisions and lead the way we’ve been leading.”
 

See all the winners of Ad Age's 2021 Small Agency Awards here.