Mark Penn: Look, I think, interestingly, creative in some sense is coming back. People are more interested than ever in the Superbowl and in great creative expression. I think what you saw with our purchase of Movers + Shakers is that we’re also cognizant that people want more and more online creativity across social media, and that a lot of cost effective marketing is there. And that’s where we’re really bolstering, particularly TikTok would be the fastest growing advertising medium around.
Ben Allanson: Obviously, some strong net new business trends in the quarter and actually over the course of the last 12 months. Ben Swinburne over at Morgan Stanley has just asked, can you talk about the pace at which you expect some of that net new business to translate into revenues?
Mark Penn: I think that the people now are getting online with it. I certainly see these contracts that we’re winning coming online by the beginning of the year, for sure. Some of them will start in this quarter, which gives us some enhanced confidence about the quarter itself. But we do see the last three, four months of new business piling up into a strong next year, which is why I feel as strongly as I do about Q1 2024. When you look at these new business numbers, these are unprecedented scopes of wins on a consistent back to back basis. When you look at some of the areas here that we’ve returned to growth, you look at research minus entertainment, you look at performance media, you look at creativity and communications, and you look on top of that this kind of new business showing our position in the business, add to that political and add to that return to really the single area that has been a big drag this year, digital transformation, that’s how these things come together.
Ben Allanson: Shifting a little bit to M&A and particularly some questions around the ConcentricLife deal that we announced last week and closed yesterday. This is a question from Barton Crockett at Rosenblatt. It was helpfully accretive and the timing is good given current pressures across your company. You say you’re looking at other potential divestments, can you provide some more color on that potential.
Mark Penn: I think that we’re looking at probably one more asset about half the size. It will equally be something that nobody ever asked me about in any of the calls. So I think that there’ll be – generally surprised at the – again, the value under our hood is really quite tremendous. And our ability then to restore and even take a sale in these double-digit multiples – you obviously take a look at the Concentric at 18 multiple, our ability then to buy stuff at 5, 6, 7 multiples and then grow them is really how tremendous value is built in our assets and should be built in in our stock and outside value appreciation.
Ben Allanson: Geographical expansion has obviously been a key tenet of the M&A approach. Brett Feldman at Goldman asks, getting scale in international markets seems like a key way you can position Stagwell to win larger contracts with your largest customers. What do you see as the most effective path to expanding your presence outside the US, both organically and inorganically?
Mark Penn: Well, the first thing that we did was really to bring together the existing assets that we had in these regions. They had been really quite scattered. So you really kind of see the double digit growth in Asia after we brought all of our agencies together in Singapore headquarters and put an infrastructure in. In Europe, in January, almost all our European agencies in London will all come together into a physical facility, work together. And then you see the same kind of EMEA growth where they’re able to kind of show the true scale of operations there. We found that’s the first path to double-digit growth and really to take existing assets that were not seeing growth and really turn them into double digit growers. I think in terms of investment, we’re still looking at Latin America, the Mid-East as in a bit more turmoil at the moment.
But we’d like to beef up in those two regions to have a better positioning for large global contracts. By the way, just to go back to an earlier question. We are seeing a very strong pitch season here in the fourth quarter.
