Inside the NATIVE-VML Deal

native vml

By now anyone who cares – and probably a lot who don’t – know that my business, NATIVE, has sold a majority stake to WPP and its empowerment partner, and that we are due to become Native VML.

For me personally this is the culmination of a 17-year journey that started when I founded my first business in 1995. Fresh out of university, with an honours degree in Philosophy, I had no idea what to do with my life. I knew that I didn’t want a regular job, I knew that I loved computers and technology – and I knew that there were no jobs for Philosophers in the Star Classifieds.

That road, as the poem says, led to others, and a year later I met Jason Xenopoulos who was founding what was to become the first significant web development company in South Africa. Together with him and the people who have stayed on this journey with me – Diane Wilson, Kevin Lourens, Jacqui Maroun, Hans Liebenberg – we toiled away at VWV Interactive for five years, achieving a lot and starting the careers of some of the leaders in the digital industry today. Vincent Maher, Tim Spira, JP Farihina, Mike Wright, Abey Mokgotswane, and many others – all got their start in the marketing and digital business there.

For me this has always been a shared journey. That’s meant I have always only been a minority shareholder in the businesses I’ve been part of. I admire some of my counterparts and competitors for having had what it takes to do this and keep a bigger piece of the equity. But truthfully I’m too lazy and inconsistent – to say nothing of spectacularly untalented in specific areas like sales –  to have flown solo. I owe everything to my partners and colleagues over the years. VWV led onto Cambrient and then NATIVE where people like Antonio Petra, Danelle Stiles, Ben Wagner, David James and Angus Robinson join the story.

So why sell? And why to WPP who are, by reputation, a juggernaut machine that barrels along with no care for the small guys? I’ve always been proud to say that I’ve never had a job, I’ve always owned my future.

I’ll tell you what it wasn’t about: the money. Money is nice but money isn’t a destiny. It is an inherently empty thing and you are always rich relative to someone and poor relative to someone else. It’s a cliche but it can’t buy you love or happiness. It can buy you some new clothes whose ability to confer happiness is transitory at best.

The ultimate reason for selling we found several months into the negotiation when we met some of the core team from VML. Based out of Kansas City, Missouri, VML is perhaps the key digital agency on the globe. Not because they are the biggest yet, but because they have a realistic vision for going global. One that is being executed right now.

They are also the only digital agency network that has taken the bold step into Africa. Whilst Isobar has been here for several years, it is more of a holding company than an agency. VML still has that American Midwestern family feel about it – as the 60+ emails in my inbox on Tuesday from VML leaders around the world testify. And Africa is now on their map via the two NATIVE offices in Joburg and Cape Town.

Africa is a tough place. Still in equal parts poverty stricken and war torn, with fragile new democracies, it is the saddest reminder on earth of the world’s colonial history and Western opportunism. But it is also a massive untapped market that is tired of being left behind. The determination on the continent to step up and be counted is palpable, and it’s in the numbers of mobile phone users.

For both VML and NATIVE, African expansion poses many risks and challenges. But we both believe that now is the time. It’ll be a slow burn but it’ll get there. And this partnership makes that possible.

Fearing being part of WPP is akin to fearing being part of a global market. Enormous and sprawling it may be but it’s agencies are standing head and shoulders above their competitors. Just see, for example, the performance of Ogilvy at Cannes recently. Far from crushing creativity and running its businesses like accountants, WPP through Ogilvy and others has silenced the skeptics.

But NATIVE is not an Ogilvy. Confident and passionate as we are about our brand we’re also realistic about where we are in the world. Perhaps if we had founded our business in San Francisco or New York or Berlin seventeen years ago we would be a Razorfish or an AKQA. But even they are just small slices of a much bigger pie (AKQA also being a WPP agency now; and Razorfish belongs to Publicis). There is a limit to what you can achieve earning rands and being this far away from the centres of influence. Kudos to Quirk, in particular, for being brave enough to be in London, but even they are an insignificant player in that market.

So the future for us was to be a bigger and bigger fish in a small pond or find a big friend. The latter choice was easy once we met the VML people. As cynical, jaded and often pessimistic South Africans we often forget that there are people and places in the world where plain old niceness hasn’t died. It wins you over fast.

So for us, and for me personally, this deal represents a thousand open doors. To VML offices worldwide. To WPP agencies. To new global clients who are increasingly aligning their brands to agency networks. And to the potential for growth for myself, my team and the digital industry in SA. Plus we retain a share of the business – making this a true partnership.

Going big isn’t for everyone. I often advise people – whoever will listen – to stay small if you can. 50 staff or fewer is the ideal size in my opinion. At that size you can be nimble, agile and specialised. You attract people who like being at the centre of the action, and your wins tend to be few but significant. Beyond that you have no choice but to build out processes and systems. You stop knowing every one who works for you and you start being The Boss. Of course many larger companies will argue that there are ways to structure so that this doesn’t happen but I don’t believe them. I’ve seen this story too many times to doubt it.

But if you’re going to grow you need to do it right. That starts with accepting that it’s happening and learning to love order. You have to nurture, respect and grow your people. And it definitely involves fostering relationships – with clients and with partners. And when the right deal comes along that can magnify that growth, to leap at the opportunity.

It’s easy to write this piece now right at the start. Perhaps I will be writing something entirely different in a year – or five. But I doubt it. The people I work with are the best there is. VML is the best. WPP is the best. If we fail because the global economy implodes then so be it. But I believe with certainty that I and my business are in the most perfect place its possible to get to. The NATIVE strategy has proven out and will continue to do so. And no, I won’t end up as the richest person in digital in SA. But I think I might end up with the satisfaction of having found the intersection between a unique brand and culture, and a being a global force.

Here comes Native VML.