November 2013: Johnny Hornby wondered how he could create a media company that was all things to all men, one that would have all the entrepreneurial spirit of a start-up and the global scale of a WPP or an Omnicom.
As a founder and the chief executive of the advertising agency CHI & Partners, he had seen clients torn between giving their business to edgy, nimble, small and medium-sized enterprises or opting for the “safer” option of a giant. There was nothing in the middle ground, a no man’s land created because the big guys sweep up all the little guys as soon as they are doing well. The magic of those agencies can often disappear in the process.
His answer? To create a holding company, The&Partnership, which works in a similar way to many law firms, where partners are owners in the business and work toward a single profit-and-loss statement that spans practices.
The bang for his buck came from Sir Martin Sorrell, WPP’s chief executive, who took a 49.9 per cent stake. Sir Martin had bought a minority stake in CHI & Partners in 2007.
“Typically, entrepreneurs start businesses, build them up, sell them and disappear after their earn-outs,” said Mr Hornby, who is the half-brother of Nick Hornby, the author of Fever Pitch . “In our new model, the entrepreneurs and founders stay involved and share ownership amongst each other and with their senior partners. We now have all the scale and retain all the entrepreneurial spirit.”
The&Partnership, which was launched this month, consists of nine agencies. The group stays entrepreneurial, it claims, because it owns most of its agencies as joint ventures, with founders incentivised to stay, as they retain close to a 50 per cent stake.
It spans four continents, ten disciplines, from advertising to PR to digital, and employs 1,400 people. Crucially, it has access to the huge buying power of GroupM, the media buying arm of WPP, whose clients buy about a third of all British television advertising.
Each agency will pay a dividend to The&Partnership. The 20 senior partners will be paid and awarded bonuses from their own agency and will be awarded dividends from the single bottom line.
Mr Hornby, the chief executive of The&Partnership, estimates that group revenues are £90 million and that the consolidated entity will have turnover of £45 million this year, valuing the business at £150 million. Agencies within it include Halpern, the PR company owned by Jenny Halpern Prince, the daughter of Sir Ralph Halpern, the former boss of Burton.
Mr Sorrell said: “Our six years as partners with Johnny and his team have proved very fruitful for us both, I think The & Partnership is a novel and exciting next step - clients are increasingly looking for us to find better and better ways to bring expertise together across disciplines for them.”
Mr Hornby, 46, is now working on a start-up to sit under The&Partnerhip. The Vineyard will focus on six-second Vine videos on Twitter and 15-second ones on Instagram. “Nowadays there are a plethora of media platforms and channels, all of which we can use to build brands for our clients. We need to be able to bring together genuine experts across all of them,” he said.