Earlier this month, Japanese ad major ADK, announced the acquisition of Chennai-based Rage Communications, an independent agency that specialises in digital experience design and e-commerce solutions. ADK will own 50.1 per cent of the company, while the founders and other principal investors of Rage will own 49.9 per cent of the company. Rage is 26 years old, incorporated on March 15, 1996, and founded by JRK Rao and Karthik Kumar. In this interview, the founders explain why they decided to sell the company that was perhaps among the early digital natives. Excerpts:
Why did you choose to sell the company now?
The reason we were looking for a partner is because as founders, we were not getting any younger and since we are a professional company employing professionals, it was appropriate to ensure a partner who would continue the culture of professionalism, when we step down from the active management of the company.
What influenced your decision to go with ADK and not with one of the large western MNC agencies present in India?
We had been in talks with other US-based networks. Ultimately they did not fructify for various reasons ranging from structural issues to a mismatch in business priorities. With ADK we found a partner where there was a synergistic fit in terms of: Low geographical overlap of markets; complementary client mix, with no conflicts of interest; services mix that is mutually supportive – both, for our organisations and for our clients. This gives us the opportunity to deepen engagements with existing clients, and appeal to a wider cross-section of clients.
What does ADK bring to the table, and what does Rage bring to the table for ADK? How will the acquisition help Rage expand its work?
ADK is the third largest agency network in Japan. It brings with it a rich history of traditional marketing communication skills, increasing focus on digital services, long-standing client relationships, and presence in most of the key markets in Asia, Europe and the US. Whereas, Rage, with its digital marketing communication focus, complements ADK’s traditional strengths to offer its clients a well-rounded communication strategy that encompasses traditional and digital media seamlessly. Additionally, Rage’s presence in India and Australia, allows ADK to expand its geographical coverage and, simultaneously, aids Rage in extending its services to ADK’s global clients with a presence in India and Australia.
What is the work that Rage is doing for its top clients?
Rage is a ‘digital only’ company. Rage’s expertise is in bringing to bear all the different disciplines that make up digital marketing communications – strategy, ideation, technology, optimisation – under one roof and offering them seamlessly to clients. Being a full-service digital communications company, our services extend from creating consumer-centric digital web presences (for example, web sites, eCommerce platforms, mobile apps) to digital marketing that includes varied types of advertising solutions (organic search, paid search, performance and programmatic marketing), platforms (social media, CRM platforms, bespoke platforms), technologies and technology stacks. For several of our clients we provide cross-border services comprising markets in Asia, Europe and North America.
Now that you are minority shareholders, how long will the founders remain in the company as per the agreement?
Both the founders continue to be on the board of the company and continue to have executive responsibilities over the deliverables of the company and its key metrics.