Why We Need an A-gency Combinator Now

Zero to One in Agency Land Part Two

Everybody’s heard about how tech incubators spawned world dominating companies. Y-Combinator, the most famous, helped birth Airbnb, Coinbase, DoorDash, Dropbox, Instacart, Stripe and more. It’s a track record that’s beyond enviable and trending toward the downright miraculous. But it wasn’t an act of a higher power.

It was driven by a disciplined approach and process, well captured in Randall Stross’s The Launch Pad. Investors liked it so much some were willing to invest across every company in a Y-Combinator class.

In our previous post, Zero to One in Agency Land, we covered why advertising and marketing services companies aren’t traditionally venture capital investments, and all of the reasons remain valid today — expensive people make or break the business when they go home at night, services don’t scale like software, firmly defined offerings lacking innovation, i.e., media relations, digital acquisition, etc.

Yet with the rise of AI, the possibility of building different, more scalable agencies is no longer a fantasy, and it’s time to think through an ecosystem to support agency entrepreneurs launching hybrid firms combining services and tech.

To do so, are there things we can learn from Y Combinator? Does it make sense to apply those insights via an incubator? What would such an A-gency Combinator look like?

First, we would steal from the tech incubators and put in place a multi-disciplinary team to run the program. Members would include:

— Founders: people who have built agencies, whether current operators with insights into market conditions or founders who’ve exited and can share insights into the process.

— Technologists: innovators and developers focused on ad and marketing tech as well as automating workflows.

— Clients: execs with a sense of what agencies do well, what they don’t and, most important, what’s missing.

— Finance / operations pros: folks who understand the nuts and bolts of running a firm and can help founders get up-to-speed on accounting, tax, payroll, etc.

Second, we would have a strong, well-articulated point of view on what a successful agency of the future could look like, and we would ask applicants to the program to respond with relevant concepts. Every possible idea would, at a minimum, need to combine technology with marketing services in a targeted, novel and more efficient way.

Third, to make the process easier, we would map out some potential paths, while remaining very open to ideas we simply didn’t consider. Some possibilities include:

— Digital Content: high quality at scale is an urgent need with the fragmenting search landscape (Google dethroned?) and the relative decline of ad targeting (iOS 14 and beyond). It’s the best way to engage consumers and customers again, but needs to be refreshed, refreshed, refreshed.

— Strategy: derived from a combination of generative AI and industry and sector pros, it would break new ground in crafting campaigns that work and are measurable.

— Immersive: a new approach to building deep virtual brand experiences that continuously engage consumers and can be leveraged throughout a broader digital ecosystem.

— Optimization: how to structure, track and enhance content and campaigns in a world of fragmented discovery, ie, Google no longer dominates, with more and more AI applications competing for queries every year.

— Multi-disciplinary: for years, agencies have pitched themselves as “integrated” and digital campaigns have certainly gone a long way toward bringing advertising, content and comms together. But should we even be thinking in these categories anymore?

These are just a start and where we come to the most complicated piece of the puzzle. With the enormous potential of AI to synthesize information and generate ideas, content and even campaigns, new models are inevitable. What else is possible in a world where both humans and AIs are your audiences, both your fans and critics?

It’s time to build an A-gency Combinator and find out.