Start me up

Today's post is dedicated to Ann Barlow and Edward M. "Ted" Birkhahn.

Representing VC-backed start-ups is a slippery slope at best. On the plus side, many of these AX034090 nascent businesses are pioneers in new, and robust, sectors that are sure to grow in the future (think: clean tech, nanoscience, Manhattan fruit stand vending, etc.).

As a result, they're extremely attractive for two reasons:

– Their business model might actually succeed and you may find yourself in the role of a latter-day Waggoner-Edstrom (a West Coast powerhouse PR firm that, in the early 1980s, partnered with a tiny start-up called Microsoft).
– You'll be able to build your sector credentials and, when the timing is right, trade up to a serious, established player in the space for a far larger budget.

But, the dark side of start-ups is bleak indeed. To wit:

– They're chaotic and almost impossible to keep on track in terms of program strategy and implementation.
– The in-house marketing or PR contact (if one exists) is typically 12-years old and has no clue whatsoever how to manage an agency or a national publicity campaign.
– Despite being founded by Bill Gates and Mark Zuckerberg wanna-bes, most start-ups tend to follow the Japanese consensus management style. Decision making is often glacial, always muddled and often reversed multiple times after the green light has been given to the agency. We had one start-up change from being a BtoC player to a BtoB, and back again (all within six months).
– Start-ups believe they're making the world a much better place. So, even though they may be bringing a next generation circuit board to market, the CEO and his team believe they should be simultaneously delivering a keynote speech at Davos and appearing on the cover of Bloomberg BusinessWeek.
– Every press announcement has to be crammed full of tech speak, industry jargon and laughable hyperbole. One start-up wanted the words 'funky culture' included in the boilerplate description of the firm believing it would catch editor's eyes and help separate them from the competition. Not.
– Last, but not least, start-ups say they want strategic counseling. But they don't. They want order-takers who are willing to work insane hours, make endless changes on press releases and endure the oral and written abuse when the end results don't meet the client's expectations.

We've fired quite a few start-ups over the years. We ended one relationship because the client violated the letter of agreement and stole away our account executive. We ended another relationship when friends at other agencies told us the client was shopping the account around after only a few weeks of working together.

I guess agencies will continue to represent these high maintenance clients because of the 'Zuckerberg effect' and the chance to build credentials in a high growth sector. Then, of course, some agency CEOs may actually believe the abuse heaped on an account team by a start-up is akin to basic training in the Army. It toughens one up for the bigger battles down the road.

I'd like to say we'll avoid all start-ups in the future. But, we won't. Hey, there's a guy holding on the phone right now who says he's the next Steve Jobs. Gotta run.

5 thoughts on “Start me up

  1. Sounds like a rough experience, Julie. It seems like most of these start-up CEOs are hard-wired to believe they not only know best, but that they’re en route to mastering the universe. Most end up as road kill.

  2. I haven’t worked on a VC-backed tech firm since my days in NYC, but I do still work with VCs that invest in the financial services industry. The tune is the same (mostly) but most in the financial industry know that it takes more than a new whizbang translator or chat aggregator to win attention from the industry (investment) rags and general consumer press. For that I am thankful.
    BTW, in regards to a previous entry, were you thinking of hiring this “Jimbo” as your driver? I so, I only drive Italian sports cars and/or American or British SUVs.

  3. Your experience, unfortunately, is not unique.
    When you say, “…they want strategic counseling. But they don’t. They want order-takers who are willing to work insane hours, make endless changes on press releases and endure the oral and written abuse…” — This accurately describes an investment bank I worked for (briefly) in the late 1990s as the in-house PR and Marketing head.
    One of the partners felt he knew more about those areas (and basically everyone’s job on staff) than the experts he hired to supposedly fill those roles. Everyone felt demoralized and deflated.
    Not a good way to run a business.

  4. Thanks for sharing our pain, Steve. Funny, though. Some of the good, the bad and the ugly that you’ve experienced is different from what I am seeing at the moment. For instance,one of the most satisfying experiences we have had in the past year is working alongside top executives of start-ups, and having them value both our counsel and craft, and their impact on the bottom line. We’ve also been able to move quickly and decisively to take advantage of narrow windows of opportunities.
    Of course, we’ve still encountered executives with monstrous egos and poor manners, and waaaay too much insistence on jargon in news releases. But, perhaps because cleantech companies have to quickly behave like industrial manufacturers if they are to survive, many seem willing to put their start-up antics aside and focus on partnering to get the job done. It makes me hopeful for the planet’s future and Peppercom’s.