Will Whiting, Luke Patton and Joshua Ogden, co-founders of Justified Studio. “Creativity can … [+]
A London creative agency has launched a venture arm aimed at helping purpose-led, pre-seed companies with branding and strategic planning. But at what stage should startups be calling on the services of brand strategists?
To be honest, it’s not a subject that comes up very often. You can cover a lot of ground in a 40-minute video call or a face-to-face meeting over coffee. Business models, marketing strategy, growth plans and fundraising. These are all topics that founders are usually keen to discuss when I interview them for this column.
Discussions about branding and brand strategy are much less common and perhaps that’s not surprising. Hiring the services of a creative agency to help with branding and strategic planning costs money. And for very early-stage companies, hooking up with an agency may not be a priority, especially if they’re struggling to pay staff and keep the lights on.
A Creative “Supercharge”
“There are a lot of advisers and VCs out there,” says Will Whiting, co-founder of creative agency, Justified Studio. “And a lot of people can put creativity low on the list. But creativity can supercharge a startup.”
Earlier this month – May 15, to be precise – the agency announced plans to put its services within the reach of a larger number of pre-seed startups. With the launch of a new division – dubbed Justified Ventures – the company is offering brand strategy support in return for equity.
When I caught up with Whiting and co-founder, Luke Patton, I was keen to discuss the role that creative agencies can play in helping startup businesses to connect with their target markets.
As Whiting explains, Justified Studio was established four years ago to harness the disciplines of strategy, design and technology in support of “disruptive” organizations. That doesn’t necessarily mean the agency is entirely focused on early-stage businesses – Google Labs is among its clients – but Patton and Whiting have a particular interest in working with founders. Hence the creation of Justified Ventures.
“We believe in a lot of the founders who are out there,” he says. “But a lot of early-stage companies don’t have capital.” Hence the equity for brand strategy offer – an approach the company quietly developed ahead of the official launch of Justified Ventures.
So, how does it work? Well, candidates are assessed in terms of their leadership teams, the product, the market and the potential for returns. However, Whiting and Patton say they are also looking for startups with purpose-driven business models.
Purpose-Driven
What does purpose mean in this context? Patton says there are a number of criteria. “Does it have a social impact? Does it have an environmental impact? Does it have an educational impact?” he says. “That’s what we look for. It’s for us to evaluate the impact.”
As Patton and Whiting see it, the creative process can extend as far back product ideation. In other cases, a founder will already have a clear idea of the product and its commercial potential. Then the role of the creative agency is to help articulate the problem and the solution by developing a narrative or manifesto. “Then you go on to develop the brand,” adds Patton.
An example of early-stage development is the video-first clothes marketplace, Finds, which was supported by Justified in terms of concept development, design and branding.
Funding Help
In addition to smoothing the road to the market, Whiting says the work of a brand strategy agency can also help pre-seed startups to raise the funding they need by creating a plan that captures the attention of VCs.
Indeed, as Patton explains, Justified encourages founders to ask themselves some of the questions that will later be put to them by venture capitalists. For instance, is the value proposal fully understood and is the right team in place. And what of the market? Is it already saturated and if so, how do you gain traction?
Fair enough, but equity is not something that is given away lightly. As a startup grows, successive rounds of investment inevitably dilute the shareholdings of the original founders and it’s not always a comfortable process. Yes, everyone knows the logic. A half share in a big company is better than 100 percent of a small one but even so, founders don’t want to surrender more equity than they really have to.
So what about swapping equity for creativity? “There is a lot of forward and back discussion about how much equity the founders want to give away,” says Whiting. “But if the value we add offsets the cost,” then it is a good deal.
“This is a mutually beneficial situation,” adds Patton. “We are invested in the businesses and we want them to succeed.”
Whether a startup will benefit from the early involvement of a creative strategy and branding agency probably depends on circumstances. Many founders will be clear about the product, branding and go-to-market strategy from the outset. Indeed, execution on these fronts may represent a personal superpower. Others might benefit from some root and branch strategic planning and design work. Whatever the circumstances, the branding and strategy issues that agencies such as Justified address are worth factoring into forward planning at the earliest opportunity.
