MANAGING PARTNER, GOULD+PARTNERS
Business strategy and public relations firm.
Rick Gould is Managing Partner of Gould+Partners. He believes that breakthrough results are created via the merger of education and experience. His passion for education is what fuels his 30+ year commitment to creation and administration of his annual “PR Agency Best Practices/Benchmarking Survey” and the reports that follow. Rick has exhibited this passion for learning in his own career. Starting his own CPA firm in his twenties, Rick went on to get his MBA and law degree.
After starting my accounting career at Ernst+Young, I launched my own CPA firm, representing more than 100 Professional Hockey players. A few years later I shifted the direction of my CPA business to serve the PR profession. In 2001, I sold my CPA firm and shifted to M&A for creative services agencies full-time, which proved very beneficial to my career. In the last 15 years I have helped to facilitate transactions among some of the top mid-size PR firms in the industry, including Schwartz Public Relations, SHIFT Communications and the Horn Group, and worked closely with many of the PR profession’s top executives, including Peter Finn, founder and managing partner of Finn Partners, and Todd Defren, CEO of SHIFT Communications.
The biggest trend, which is likely to accelerate in the foreseeable future, is the growing rate of “roll-ups” among small- to mid-size creative services firms, including PR and advertising agencies. Another big trend: private equity players are fast jumping into the PR and ad sectors and executing more transactions. This heightens the overall competition for creative services assets among strategic players (agencies that want to acquire other firms and take them to a higher level) and private equity players (which acquire companies only to flip them a few years later at a much higher price than what they payed).
The most important challenges/opportunities for creative services firms is the ongoing transition from traditional PR and marketing channels to digital and social media platforms. The ability to monetize social media platforms is getting to be very problematic for many small- to mid-size firms, not to mention the most effective ways to meld digital media with traditional channels that still hold value. The ongoing changes in the market have an impact throughout the agency world, in terms of budgeting, creating new services, utilization, integrated communications and recruiting new talent to fill new disciplines regarding content creation, online analytics and data management. And the more agencies and firms react to these changes in the marketplace—rather than be proactive and forward-thinking—the further behind they’ll fall in the eyes of potential buyers, not to mention their clients and prospects.
While I ran my CPA firm I got a taste of M&A for creative services firms and agencies and was fascinated by the opportunities in the market. I was confident I could be successful facilitating transactions in the creative services sector, so I made the jump to M&A transaction facilitation and consulting full-time. It was a matter of following my gut and charting a new and more lucrative and passionate course for my career.
Other than expanding our global footprint in Canada and India, we are also starting to ramp up business with a growing number of U.S.-based small-to mid-cap size creative agencies. We sense a generational shift throughout the creative services profession, as agency owners who are baby boomers increasingly are looking for an exit strategy and to hand over the reins to digital natives, or people born of the millennial generation. We’re also being proactive on the content marketing front. In February I hired Matthew Schwartz, who has been covering PR and marketing for nearly 20 years, as editorial director for our firm. Matthew continues to expand our editorial of the agency world and create new thought leadership opportunities/programming for our company and our partners.
I am a frequent speaker at industry events, including PRSA’s Counselors Academy’s Spring Conference. I am also a featured speaker at a periodic breakfast series, sponsored by Gould+Partners and the large accounting firm ANCHIN, focusing on creative services trends and agency management. Earlier this year, I was a featured speaker at “Staying Profitable, Sustainable and Legal in the New Economy,” which was sponsored by the National Capital Chapter of the Public Relations Society of America and took place at the National Press Club. In July we launched Inside Edge…Business Strategy for PR, Media & Creative Service Agencies, an email newsletter catering to agency/firm owners of creative services firms. The newsletter is designed to help creative services owners and managers boost their top and bottom lines and enhance the overall value of their firm.
September 11, 2001. I just sold my CPA firm three months earlier and launched the M&A firm. But after September 11 there was no M&A. Buyers stopped buying and sellers rapidly lost value to their firms. Their clients were freezing PR and Ad budgets and many firms folded. What I learned is hope for the best, but plan for the worst. Build a reserve/war chest for tough, unpredictable times.
I think my clients (and prospects) appreciate how comprehensive I am throughout the M&A process. I won’t even take on a client unless I am totally confident in his or her commitment to executing a sale. Once I am confident, there are dozens of moving M&A parts in terms of generating a successful transaction and, ultimately, maximizing the seller’s valuation. I provide a guiding hand and M&A expertise every step of the way, ranging from strategic planning to understanding what sellers want to integrating the seller with the buyer.
I don’t need to motivate any members of my firm. They are all self-motivated, senior executives who love their work and working with clients. The M&A business is in an interesting, exciting business.
My career advice to owners of both established firms and agencies (as well as startups) is always to manage their firm “as if” they’re going to sell, even though they may have no intention to sell for many years. By adopting an “as if” mindset, owners pay much closer attention to building value for their firm and improving their bottom line.