AKQA Buys SearchRev; More Deals To Come

Focused on speedy growth through acquisitions, AKQA has acquired search marketing company SearchRev. Terms of the deal were not disclosed.

Tom Bedecarre, CEO of AKQA, said the deal is likely to be the first of many as the independent digital agency seeks to expand its range in the areas of search, media and mobile.

"We have pretty ambitious goals," said Bedecarre. "We want to integrate a number of services for our clients, so a CMO can optimize search against landing pages and so forth."

Bedecarre's strategy was made possible by AKQA's decision earlier this year to sell a majority stake in itself to private equity firm General Atlantic for about $250 million.

News of the AKQA sale in February came just a day after Publicis Groupe closed its acquisition of AKQA rival Digitas. Another rival agency, iCrossing, doubled its size in July by acquiring Web development agency Proxicom for an undisclosed sum.

Whether in the area of search, media, or mobile, what is AKQA looking for in a company?

"We're looking for solid management teams and services [that] our clients need," said Bedecarre. "What we like to do is to find companies that have developed an interesting technology, but have been focused on delivering it within a particular niche. We have the network to scale that solution and offer it across different areas of our business."

That is exactly what AKQA plans to do with SearchRev, according to Bedecarre, who estimates he can easily double the search marketing company's business by next year. With 55 employees, SearchRev presently has 60 clients, including Coca-Cola and Yahoo. Its annual revenue is estimated to be less than $10 million. (Bedecarre would not comment on the company's worth or revenues.)

The nearly 600-employee-strong AKQA has offices in cities around the world, including San Francisco, London, New York, Singapore, and Shanghai. The agency's revenues are commonly estimated at $75-100 million. For context, iCrossing forecasts revenue of about $110 million this year, while aQuantive had forecast revenue this year of about $615 million before it was acquired by Microsoft.

Competing against AKQA for worthwhile digital assets is a shark's tank of bidders, from holding companies and media conglomerates to private equity firms and Web goliaths like Microsoft and Google. According to Bedecarre, at least, AKQA has the edge.

"We can compete on more than price," he said. "A lot of networks [would] rather work with us than be absorbed by some large behemoth. There's also a better opportunity for interest owners to grow with AKQA than with bigger, slower-growth companies."

AKQA has recently done work for a host of blue-chip clients--Coca-Cola, Nike, Visa, McDonald's, Smirnoff, and Unilever, among others. The agency added Nike and Microsoft's MSN to its client roster last year, and also won global assignments from McDonald's, Smirnoff, and Johnnie Walker.

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