How to open an advertising agency?

And let there be light. God’s will was expressed in the human tongue. Many agency founders experience the same warm light when they step out of the shadows of their former places of worship workspace.

Many folks, after a disappointing day or sometimes a good day of work, sit down and wonder about opening their own shop. But, as soon as the cup of tea in their hands is finished, reality sets in, and they go back to work the next day. Some, however, linger, and eventually, go ahead and just do it.

“I don't think it was to prove anything for sure,” says Pallavi Chakravarti, co-founder and chief creative officer, Fundamental, an agency founded in March 2023.

For her and her co-founders Nishant Saurabh and Anand Murty who are also the chief executive officer and chief strategy officer respectively, time and again they found themselves agreeing on what constitutes good advertising, and because the trio were at the cusp of making a name for themselves, “all of that over a period added up to the sentiment of "enough talking, let's go for it",” remarks Saurabh.

Sometimes people open an advertising agency to make changes they could not at their previous workplace. Santosh Padhi, co-founder, Taproot (later Taproot Dentsu) says when you work at an agency, you eventually get married to its culture, and as an individual, you cannot change the machinery. “The only option is that you start from an empty canvas.”

Padhi worked at Leo Burnett as an ECD and went on to start Taproot with Agnello Dias in 2009. Dentsu India acquired the agency in 2012.

It is a sentiment Gautam Reghunath, co-founder member, Talented shares. “Our ambition for what a creative organisation should be was very different from how Dentsu India's vision for creative companies." He, like Padhi, says they needed a blank canvas to experiment with.

The first hurdle

Dreams are made in the mind but to bring them over to the mortal world, money is what it will take. There are many ways to raise money to open an advertising agency but an overwhelming majority of agency founders afaqs! spoke did it on their own terms and did not choose to go the investor route.

And that is because, as the founders of Fundamental, Talented, and Taproot tell us, the advertising agency business is not capital intensive. “All we need are places for people to sit with a laptop,” says PG Aditya, co-founder, Talented.

Padhi sums up this thought when he says many people who grew by giving away 30-40% of the agency share are now feeling the pinch because every single time, a rupee comes into the system, 40-50% goes to someone who does nothing. The person who is running the agency is feeling the pinch.

Shradha Agarwal, co-founder and CEO, Grapes has an interesting tale here. She joined Grapes Software which her husband Himanshu Arya ran and “after selling only websites for six months” she got bored and said she wanted to get into content and social media, among other marketing services.

"You need money to start this vertical, I will invest and back you. But you need to figure out your clientele, and I will help wherever I can," quipped her husband. Grapes Software became Grapes Digital in 2015 and 2021, it became Grapes, an integrated agency.

The Beatles crooned All You Need Is Love, for ad land, it is only tables, chairs, laptops, and serious brains.

The first friend

What is an agency without a client, it’s a friendship set in stone. However, for newcomers, getting that first client can sometimes become the toughest challenge and often set the course for the near future.

For instance, Grapes, for many years, had become the second agency to Maruti Suzuki Nexa while Hakuhodo played the protagonist’s role. While the agency did not bill Maruti, “it taught us a lot and we performed well.” Homeshop18 and Pepperfry were the other two clients at the start.

The first client who comes on board is the one who trusts the new agency’s founder(s) and their credentials. It is heartening.

It was the Times of India for Taproot which, as per Padhi, “allowed us to demonstrate our creative strength.” Talented see Brittania, Cleartrip, and Bumble as its first believers.

The first believers

Clients may be an agency’s first friends but its first believer is its employees. The people who take the risk and leave their well-paying job to join a youngling. It is naturally challenging to converse and then convince people to join a new agency.

“The sentiment we are seeing today is that people wish to join people and not agencies,” says Saurabh of Fundamental. It was something that used to happen in the past and seems to have risen once again.

While agencies like Talented and Fundamental choose to hire experienced folks, Taproot decided to hire youngsters with one to three years of work experience. “They loved the fact that they got to work with Aggie and Paddy (nicknames for Taproot’s co-founders),” reveals Padhi.

It is hard for people to leave a well-cushioned job but sometimes the risk can be worth it. The first 20-odd joiners of Talented were named partners.

The case of two leaders

A co-founder is a partner to whom you can confess all your professional fears. Or that’s how the quasi-adage goes. But, does it help?

Talented’s PG Aditya makes it clear that there are no strict demarcations between him and Reghunath. “I don't think Gautam is non-creative. He's had more of an influencer on our showreels than I'd like to admit,” he says.

Padhi had Dias, Fundamental has three, the more the merrier is often welcomed because when one isn’t present, there is someone else to take over and ensure the agency’s functioning remains smooth. And while each founder may have his or her special role, many quite often work on most if not all aspects of an advertising agency.

“We haven't come in looking to build an empire, build some 200-people outfit, but have come by a common love for what we do, and hoping if this takes off and goes in the direction it wants to go in, there is no better way we feel to spend the last leg of our working lives,” says Fundamental's Chakravarthy echoing what most agency founders must have imagined when they started. 

Cover image credit: Variety