US-based investment firm The Stagwell Group acquires UK agency Forward3D
The Stagwell Group announced the acquisition of London-based digital marketing agency Forward3D.
DC-based Stagwell Group acquired London digital agency Forward#3D
Stagwell Group, a digital marketing and investment firm founded by former Clinton adviser and strategist Mark Penn, has a mission to reinvent the traditional advertising agency holding company model by focusing on digital-first marketing services. It chose Forward3D for its focus on performance marketing.
The London firm has 11 offices and 350 employees worldwide.
Forward3D has a client roster that includes Hilton and Gucci, and is projected to earn $30m to $50m in net billings this year. According to the Wall Street Journal, this marks Stagwell’s 16th transaction since its 2015 launch, where it raised an initial $250m in funding, including from former boss at Microsoft Steve Ballmer.
Results International helped to broker the deal. Director Mark Williams at Results had this to say about the acquisition: “Digital marketing, and performance marketing in particular, continues to grow at pace, with M&A being driven by the need for international scale as the world’s largest global brands demand a truly international service. The Stagwell Group's acquisition of Forward3D Group is the latest deal where a disruptive US acquirer looks to the UK for a platform to drive growth outside of the US. Cognizant’s acquisition of digital agency Zone is another recent example.”
Forward3D Group, considered a challenger agency, “has seen a phenomenal growth trajectory since it was founded,” said Williams. “It has an enviable roster of global blue chip brands and has expanded into numerous overseas markets, reaching an international scale few agencies are able to achieve independently. Notably it has made great headway in Asia and has offices in Shanghai, Seoul and Tokyo. As a premium-quality, scaled business, Forward3D Group was a logical and valuable target for acquisition.”
“Stagwell is an exciting home for Forward3D Group,” Williams continued, “it’s clear that there is now a much richer universe of acquirers for digital marketing businesses than just the holding companies. This of course includes the management consultancies, Asian-HQ acquirers and fast-growth independents, such as Stagwell.”
Stagwell isn’t well-known in the UK, but Williams noted Penn’s experience at both WPP and Microsoft as an influence. “It was set up to invest in marketing services businesses,” he said, “and one can think of it as a challenger acquirer to the traditional holding companies offering an entrepreneurial and dynamic environment for further growth. This makes it a great fit for Forward3D Group. With the acquisition, Stagwell is now one of the world’s leading independent performance marketing groups.”
Williams saw this sort of activity continuing within the next year: “Independently-minded businesses may well opt for deals outside of the established networks and this looks set to be a trend to look out for in 2018.”