LAS VEGAS — When he led the world’s largest ad agency holding group, his central strategy was seeking growth in two circles of a Venn diagram – digital media and emerging markets.
Now that he helms his own S4 Capital, Sir Martin Sorrell aims to repeat the trick – with a twist.
S4 Capital, a brand-new but publicly-listed company, opened 2020 by announcing another piece of M&A, a merger with Circus Marketing, a Latin America digital marketing agency.
In this video interview with Beet.TV from the Consumer Electronics Show, Sorrell explains the rationale…
“So, now we’re in 30 countries,” he says. “(It’s) basic digital advertising content, so it very much fits with our model, which is purely digital, we’re only interested in where the growth is.”
After its initial capitalization in 2018, S4 Capital was kick-started by a pair of key acquisitions – content studio MediaMonks and programmatic firm MightyHive. Since then, MediaMonks and MightyHive have respectively acquired or merged with Caramel Pictures, Datalicious of Korea and ProgMedia.
The plan is to continue bolting on what Sorrell calls “practices” in order to execute a “land and expand” strategy of customer growth.
In October, MediaMonks merged with Firewood, a large digital agency servicing Silicon Valley companies. So S4’s client list already includes Microsoft, ServiceNow, Uber, Amazon, Facebook, TikTok and others.
“Growth is very hard to come when you have a traditional analogue business,” Sorrell adds. “We have no traditional, no analogue business. (We) focus on digital because that’s where the growth is. So that’s where we’re zeroing in. Our client list is 50% tech…”
He says his approach puts S4 and its constituents at an advantage over the likes of his former WPP.
“We have a supply constraint, we don’t have a demand constraint,” he says. “The holding companies have a demand constraint – they’re all flat on their back or up by 2 or 3%, at maximum.
“Sixteen months in, we’re a dollar unicorn … capitalised at about $1.2 billion on the London Stock Exchange. Our organic growth is 45%. There’s very few, if anybody, in our industry growing at that rate. On a pro forma basis, our revenues are about $400 million. So we’ve made a fast start.”
This video is part of a series produced at CES 2020 called Television Redefined, sponsored by Samsung Ads. For more videos, please visit this page.
