Foreign partnerships can offer a fresh, outsider perspective and the chance to cross-fertilise ideas, says Charlie Hoult
One of the smartest things we think we’ve done at Loewy is to hook up with a foreign partner. Almost a year ago, we agreed a joint venture with Iceland’s largest ad agency, Hvita Husid, which is also known as the country’s most creative.
In return for 10 per cent equity and a place on our board, Loewy got a useful injection of cash from its new partner, plus a fantastic opportunity to cross-fertilise the businesses on a number of levels – creative, new business and operational – all of which are now paying dividends.
We also get to work on some international projects, which, because of our scale, we might not normally get a chance to. For example, we’ve just completed a major rebranding initiative for leading Scandinavian financial group, Glitnir, with similar scale projects in the pipeline.
Early on at Loewy, we made a decision to adopt a ‘fusion’ mentality, bringing down artificial boundaries of all kinds between disciplines and between cultures. Any business that wants to grow has to be adventurous.
Rather than chase after ‘dumb money’ from a bank, it made a lot of sense to secure ‘smart money’ from a like-minded company, which could also bring an outsider, expert perspective to the way we do business. I’m not sure how many independents in our sector have actually thought about alliances of this kind – if they haven’t, they are missing a trick.
Of course, you’ve got be clear on why you’re entering a foreign partnership and make sure you follow through, so that you get to reap the full gains. Do think outside your normal comfort zone – just because you’re a design consultancy doesn’t mean you have to hook up with another design consultancy.
As with any kind of partnership, there are issues of control and autonomy, trust and insecurity. And, in the same way that you would apply due diligence to a joint-venture partner here in the UK, don’t let the normal rules of business fly out of the window just because you’re ‘playing abroad’. Unlike some foolhardy Brits buying homes overseas, don’t let the foreignness of it all find you with your guard down.
That said, don’t get too bogged down in legals and financials either. Trust underpins everything we do with Hvita Husid and we try to keep things simple.
We have a two-way, mutual agreement of 10 per cent for any of our clients, where we commission our partner to help and don’t get involved, plus 5 per cent where we both work together on a new client. We have monthly board meetings where we discuss ongoing projects and assess how the partnership is faring.
Do follow your gut. Language will always be an issue, so make sure you can communicate, but if it feels right culturally and you share similar values, then it probably is. That’s not to say you’re going to find your perfect partner on the first date. Before selecting Loewy, Hvita Husid ‘beauty-paraded’ around 30 different UK groups.
Incidentally, like it or not, some cultures do have more of an affinity with we Brits than others, and can make more natural bedfellows.
It is also important that you start from a position of confidence in your own offering and capabilities, knowing that you can ‘hold your own’. You need the right mindset and to be open to collaboration and sharing. If you are going to feel vulnerable, you’ll miss out. If you’re happy to ‘play together’, you can gain a lot.
For sure, there’s an element of ‘raising one’s game’ when you have outside partners. You also get a really interesting new perspective on creativity and exposure to other design cultures, which is hugely stimulating. That’s not to mention the opportunity for travel and to work on top notch global projects with overseas colleagues.
It’s also hugely satisfying to note the high regard in which UK creativity is held and the foreign fascination with UK design work. By partnering with foreign teams, you get a check on just how challenging the UK market is, how creativity is so high on the agenda and how the creative economy here is a really significant one.
And foreign partners get to share in some of that glory. Hvita Husid has gained from the attention that the partnership has secured them, both in their home media and from competitors, and has found that having a formal international link provides a real point of difference at the new business level.
Charlie Hoult is managing director of Loewy Group
FORMING INTERNATIONAL ALLIANCES:
• Follow your gut when it comes to deciding how a potential partner fits your own consultancy
• Cast your net wider than just the design world when looking for a partner
• Expect issues of control and autonomy, trust and insecurity
• Don’t relax your guard because it’s a foreign deal – be just as diligent as you would be with a UK partner