Will Your Creative Agency Benefit from VC investment in Tech Companies?

Some years back ,Ad agencies had started the trend of investing in companies that they believe are shaping the future of technology and advertising .The benefit is not only that this offers a first-mover advantage to both the agency and its clients, but also a sizable return in investment if the company goes big.

From a marketing agency perspective, I believe technology companies which focus on analytics (or simply, making sense of data), mobile, localized marketing (would be leading the way soon. Investing in them could be a good bet if you know what you want. Of course VC investing is not the only way by which you could gain the early bird advantage — partnerships help too, which we’ll be talking about in another post.

The first thing to keep in mind as an agency investing in a technology company is that you must be able to use the technology to provide better service your clients. Remember that you are an agency first and foremost, not a VC firm looking for the next Facebook.

An important measure to consider is the fact that you’ve formed a good wing consisting of dedicated investment professionals to oversee new deals.VC investing ain’t hippy as one might think. You might have the vision to spot trends in your industry, but monetary investment is something that should be managed well.

Agency-style investments are double faced: You aren’t really motivated by money, which makes your proposition a good choice for start-ups. But at the same time Start-ups are not looking for money only, they’re looking for guidance as well. That might make your proposition a bit less sexy. If they’re solely looking for money, for which chances are good that a partnership based solely on money won’t do much good for you.