• by Joe Mandese  @mp_joemandese, August 28, 2008

Toronto-based agency holding company MDC Partners is spinning off a digital media management company that was incubated within its New York-based The Media Kitchen unit. The new company, dubbed Varick Media Management, a reference to Media Kitchen's address at 160 Varick Street in Manhattan, is based on an open online exchange structure that will enable marketers - and presumably other agencies - to trade digital media buys in "real time" across a variety of online exchanges, ad networks and Web sites.

Varick Founder and President Darren Herman likened the new service to a Wall Street "hedge fund," and said that it utilizes proprietary algorithms to manage its client's digital media buys.

"Our algorithms enable us to aggregate audiences and optimize the media mix," he boasted in today's announcement.

Varick was spawned by MDC's The Media Kitchen, which is a unit of New York agency kirshenbaum bond + partners company, and will initially launch with the agency's roster of media clients.

Varick grew out of a strategic partnership with MediaMath, a New York-based media trading platform that provides algorithmic bid management, analytics, and technology to media buyers. The system has access to multiple ad exchanges including Google, DoubleClick AdX, Yahoo! RightMedia, Microsoft AdECN, AOL Spot Market, TraffiQ, AdBidCentral and more than 110 million users across 65,000-plus Web publishers.

The spin-off is part of a trend toward digital media entrepreneurism within Madison Avenue's leading media organizations. A variety of major shops are looking at new ways to monetize state-of-the-art media management systems beyond their internal roster of agency clients. In December, for example, Havas unveiled the development of a proprietary global online advertising network that it created on the basis of its internal Artemus online user data management system.