Three years ago, Code and Theory (C&T) founders Dan Gardner and Brandon Ralph (who left in 2017) reached that inflection point experienced by many independents: Do they stay small or continue to grow with an outside partner?
After making the rounds with the various holding companies, consultants, and even one privately held media buying shop, C&T became one of the first acquisitions under the recently formed Stagwell Group, launched by Mark Penn and Steve Ballmer.
That was in early 2016, and C&T has flourished under Stagwell's "Noah’s Ark" strategy of acquiring an array of specialist shops with different capabilities under its umbrella. The agency has grown from two people in 2001 to more than 500 working with clients including adidas, Burger King, CNN, Facebook, and JPMorgan.
In 2017, the agency, along with Stagwell’s other shops, migrated to new and expanded facilities, with panoramic views in New York’s Freedom Tower complex, though Gardner jokes it lacks the "character" of C&T's old SoHo operation, formerly Andy Warhol's Interview magazine headquarters.
Gardner says it is too soon to tell how the recent Stagwell-MDC Partners alliance, as well as Penn's elevation to CEO at MDC, will affect his agency. He says he is happy to have some of the world's most creative agencies as sibling shops.
Up till now, Gardner attributes C&T's success to a slightly paradoxical strategy that has evolved away from “all things digital,” yet has doubled down on the same expertise. While C+T can develop creative, the agency remains firmly rooted in interlinking clients across all digital footprints.
The agency is modeled on the multi-spoke hub of data/analytics/research, platforms/publishing, engineering and marketing. It's about the mind-set of the organization, says Gardner. "Digital first is really user first." Most digital agencies, Gardner, says, are really just digital production companies that use "digital as tactic" to achieve a broader marketing goal.
C&T, by comparison, examines everything in a company, from the back office and inter-agency communications to the ordering process and consumer-first communications. "Yes, we can make the app. We can do the website, but we really connect all digital to retail," says Gardner. He adds this evolution means a growing number of pitches are increasingly against consultancies for systems/platforms accounts. Still, 60% of RFPs remain against traditional agencies, like Huge and R/GA.
At the same time, unlike R/GA and its rivals, the agency isn't migrating into product innovation or launching Direct-to-Consumer practices. Instead, C&T is focused on its own core expertise.
Gardner says Penn is an ideal corporate parent. Though he isn't "in the weeds doing projects," he immediately responds to any calls and maintains an office a floor above C&T. (New York-based Stagwell agencies are all housed at 1 WTC.) He swoops in from time to time for critical pitch presentations in order to help land business, says Gardner.
Sibling agencies in the group work well together, says Gardner, often collaborating to effectively service clients.
The model appears to work, given Stagwell’s double-digit annual growth in recent years.