Principals: Jim Weiss, CEO (pictured); and Bob Pearson, president and chief innovation officer
Subsidiaries: Marketeching Solutions, Pure, Sentient Interactive, Twist Mktg, and WCG
Revenue: Global: $122,715,000; U.S.: $113,511,155
W2O Group had a year of changes, completing three acquisitions and selling a stake in the agency. Among all the change, it saw overall global revenue growth of 33% — 4.4% organic — and a 32.5% uptick the U.S.
Despite saying last year he had no intention to sell the firm, W2O did divest an undisclosed share of the company to private equity firm Mountaingate Capital in May 2016 to "help the company grow," says agency CEO Jim Weiss.
"A lot of companies stall as they approach that $100 million mark," he explains. "How am I going to continue growth exponentially and robustly beyond that and not stall? I had to find a financial partner that understood that and was well aligned with that strategically."
Much of the agency’s growth came from its healthcare practice, which made up about 85% of 2016 revenue. But Weiss praises the growth in the technology and consumer practices as well, which both expanded more than 30% over 2015. In those two areas, W2O began working with Sony, Philips, Comcast, United Technologies, and British retailer Tesco last year. The firm also increased work with existing clients including Merck, Pfizer, Medtronic, and PepsiCo. Clients lost in 2016 included NetScout Systems and Whole Foods.
Staff turnover was 20%. Executives who left included Paul Dyer, president of analytics and insights, who became president of Lippe Taylor; CCO Mike Hartman, who departed to found creative strategy consultancy RelevantVerse; and Carolyn Wang, president of BrewLife, who joined Verily Life Sciences.
A year of acquisitions
W2O acquired three agencies in 2016 to expand its expertise. The firm acquired life sciences agency Pure Communications, combined it with its existing subsidiary BrewLife in September, and rebranded it as Pure. In November, W2O acquired research and analytics firm Marketeching Solutions, adding its 20 staff to the agency.
The firm also snapped up Sentient Interactive, a digital marketing agency, in December. With these acquisitions, W2O now has a specialized health and tech subsidiary, a larger data and analytics team, and an expanded digital marketing offering. Adam Cossman, president of Sentient Interactive, became W2O’s chief digital officer; former Pure Communications CEO Andrea Johnston now leads Pure; and Marketeching president Kevin Johnson continues to lead the firm.
Weiss expects to acquire two more firms by the end of 2017 and is looking for continued double-digit growth.