Home / Tech / A startup says it built a profitable business solving ad agencies' staffing problems — and it has three of the top five holding companies on board, including IPG

A startup says it built a profitable business solving ad agencies' staffing problems — and it has three of the top five holding companies on board, including IPG

WorkReduce Team

  • One of ad agencies’ many struggles is that they struggle to fill mid-level roles.
  • Former coder and adtech sales executive Brian Dolan has capitalized on the need, launching an on-shore remote staffing company WorkReduce after he saw an agency waste $500,000 on a single campaign because of a lack of oversight.
  • Most ad agencies won’t discuss their use of third-party staffing companies like his, but WorkReduce said it works for three of the five biggest holding companies including IPG; is growing at an annual rate of 100%; and is profitable.
  • Some big agencies take other approaches to their staffing problems. Publicis, for example, builds pools of employees outside major cities by working with universities.
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A man we’ll call “John” is a former pro gamer. He doesn’t fit the typical profile of an advertising staffer, but he analyzes campaign data for a media buying agency that’s owned by one of five biggest ad holding companies.

Brian Dolan, founder and CEO of Boston-based remote staffing company WorkReduce, said he’s built a profitable business in five years on the premise that employees like the ex-gamer will form an ever-larger piece of the ad industry puzzle.

Most ad agencies won’t discuss their use of third-party staffing companies, but Dolan said he works for three of the five holding companies, including IPG; Dolan wouldn’t name the other two. He said his company is growing at an annual rate of 100% and is profitable.

He also claims prominent investors including Jacob Hsu, CEO of IT firm Catalyte; Eric Yang, co-founder of consultancy The Agency Shop, which works with Deloitte; and Andy Chen, former CEO of Jay-Z’s streaming music service Tidal.

WorkReduce’s CEO launched his business after watching an ad agency waste $500,000 of a client’s money on one mistake

Dolan, a former coder and head of sales for connected TV platform DataXu, has never worked at an ad agency. But he told Business Insider he came up with the idea for WorkReduce after seeing an agency waste $500,000 by running a geotargeted campaign without doing the advance targeting work.

Ad agencies have well-publicized problems hiring and keeping talent as clients cut budgets and hire would-be agency employees as they take their marketing work in-house.

According to Dolan, a bigger challenge is finding people to do the critical but unsexy, repetitive, mid-level work like analyzing numbers and managing paid social media campaigns that can prevent costly mistakes like the one mentioned above.

Jade Watts, executive director at IPG agency Mediahub, told Business Insider that her company hired WorkReduce to address the challenges of recruiting at its Boston and New York offices and filling specialist roles like programmatic trader that don’t require Ivy League degrees or proximity to Manhattan.

“The economics are inevitable,” Dolan said. “I’m just here before the agencies are.”

The big ad holding companies won’t admit to outsourcing work

A big part of WorkReduce’s pitch to agencies is that it saves them money by hiring people who live in areas with lower costs of living. And unlike other outsourcing companies such as India’s Wipro and Manilla-based WideOut that serve the ad industry, all 80 of its employees are based in the United States.

Watts said the use of remote staffing services is growing more common among agencies like hers and that other companies have recently pitched Mediahub with similar offerings. 

Still, most holding companies won’t acknowledge using remote staffing services — even when their own clients’ contracts require such disclosures. Some of the biggest names avoid the practice altogether and address the talent crunch in other ways.

Publicis creates new pools in cities like Atlanta and Detroit, working with local schools like Georgia Tech and training graduate students to handle analytics tasks while diversifying its workforce in the process.

Tim Jones, CEO of the Americas at Publicis Media, estimated that Publicis employs around 145 people in Atlanta and Detroit who support teams in bigger cities like New York.

As Accenture and Deloitte try to chip away at the agency business, a new space has opened for companies like WorkReduce

Outsourcing has a dubious reputation because many companies use it to hire low-level staffers overseas and avoid paying for overhead or benefits. Another knock, Jones said, is that outsourcing risks compromising agency culture.

Dolan’s response is that all his employees have health insurance. He also said that, as consulting firms move to compete in the marketing space, they have prevented themselves from providing outsourcing services to agencies and thereby created an opening for companies like his.

“We think of ourselves as a micro-mini Accenture,” said Dolan.

SEE ALSO: The FCC has officially approved the T-Mobile and Sprint merger. Here’s how Sprint’s CMO thinks the combined company will change 5G and advertising.

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