MDC Partners (US)

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MDC Partners is a mid-sized North American marketing group, housing a broad portfolio of creative and diversified marketing agencies, now mainly headquartered in the US, but with a growing international network. Operating primarily as a venture capital investor, it has accumulated stakes in a collection of separately branded, often single-office agencies, several of which have gradually developed a limited international profile. MDC has become best known for its shareholdings in two highly admired American shops, Crispin Porter & Bogusky and 72andSunny, each of whom also has outposts in Europe. Other subsidiaries include KBS, Anomaly and fashion specialist Laird & Partners. A key addition in 2012 was the purchase of a minority stake in Detroit-based Doner. The main benefit MDC offers its partner agencies is the upfront payout for their shares. Beyond that, businesses are left with operational independence, and that includes the freedom not to work with each other to grow faster or more efficiently. Gradually, though, the group has begun to encourage synergies between its various subsidiaries, not least through the creation of a pooled central media buying agency, now known as Assembly. However, after several years of rapid growth, MDC ran into a succession of problems in the 2010s. An SEC investigation into expenses claims filed by founder Miles Nadal led to his abrupt departure in 2015; soon afterwards, the rapid growth curve began to stall, and in 2018 MDC finally launched a strategic review that may lead to its sale or break-up.

Who are the clients of MDC Partners? See individual agency profiles below for more

Who are the competitors of MDC Partners? See ranking of Leading Global Marketing Groups 

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Brands

Colle & McEvoy Concentric Pharma
Mono TargetCom
HL Group Source Marketing

Recent stories from Adbrands Weekly Update:

Adbrands Weekly Update 1st Nov 2018: Another grim quarter for struggling MDC Partners, though with some glimmers of improvement. Revenues of $375.8m for 3Q represented organic growth of 1.5%. That was significantly better than last quarter's 1.7% decline but still far behind past performance. The group expects to report around 1.0% for the full year. Bottom line was impacted by a $21m impairment charge against goodwill and other assets, resulting in a net loss of $18.2m for the quarter. Excluding impairment and other most non-cash items, adjusted EBITDA would have come in at $59.8m, compared to $53.8m for the year-ago quarter. Dentsu and Havas/Vivendi are both due to report mid-next month.

Adbrands Weekly Update 27th Sep 2018: Just in case anyone in the industry hadn't already got the message by now, MDC Partners formally confirmed that it is "exploring potential strategic alternatives"; in other words, putting itself up for sale. That follows a grim set of results for 2Q, as well as what will presumably be an even weaker result for the quarter about to end. As announced last week, the group is also seeking a successor to chairman & CEO Scott Kauffman. The problem facing MDC in its search for a buyer is that its several parts are worth considerably more separately than the sum of the whole. Comparatively few acquirors will want to buy the entire group, but key assets like 72andSunny, Anomaly, Crispin Porter & Bogusky and what is now Forsman & Bodenfors would each individually appeal to other groups.

Adbrands Weekly Update 20th Sep 2018: Scott Kauffman, chairman & CEO of MDC Partners for the past three years, announced plans to step down from that role, though he will remain a director. Kauffman was previously MDC's presiding director, but became chairman & CEO in 2015 following the ousting of MDC's founder Miles Nadal over extortionate expenses claims that had resulted in an SEC investigation. "This is the right time for me to transition back to the board," said Kauffman. "I look forward to supporting our partners, the executive team and my colleagues throughout this process to ensure that we have the stability and continuity necessary for success." Kauffman will stay in place until a suitable successor can be found.

Adbrands Weekly Update 9th Aug 2018: Alex Bogusky's surprise return to CP&B was the silver lining to follow a grim set of results for parent group MDC Partners. Revenues of $380m for 2Q represented a 1.7% organic decline. It is MDC's weakest ever organic performance, though lower than the declines already reported by Havas and Publicis. The group blamed "client cutbacks, delays and slower conversion of our new business pipeline". Net income for the quarter plunged from $8m in the year-ago quarter to just $1.1m, reducing the half-year loss to-date very slightly to $30m. Despite the weak quarter, MDC held its organic growth forecast for the year at between 1% and 3% - the year-to-date figure is currently -0.5% - and also promised "materially improved profitability" in the second half. With only WPP left to report 2Q figures (not until September), here's the current ranking for organic growth (or decline) in 2Q. Dentsu 5.9%, Interpublic 5.6%, Omnicom 2.0%, MDC -1.7%, Publicis -2.1%, Havas approx -4.1%.

Adbrands Weekly Update 5th July 2018: Former Crispin Porter & Bogusky chief creative officer Ralph Watson filed a lawsuit against that agency, its holding company MDC Partners and multiple individuals employed by those two companies on multiple charges including wrongful termination of employment, discrimination, defamation and civil conspiracy. Watson already has a suit in progress against anonymous Instagram account Diet Madison Avenue, which accused him, as well as several other executives at different agencies, of sexual harassment. Virtually all of the men named were dropped by their agencies despite little apparent evidence to back up Diet Madison Ave's allegations. Watson says in the suit that he was wrongfully terminated by MDC despite being an "exemplary performer during his entire tenure with the agency... as a direct result of Diet Madison Avenue's false statements, pressure and interference." MDC and CP&B said they stand by their original decision to terminate Watson and vowed "to vigorously defend themselves and their employees" from the lawsuit.

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