Why Ajaz Ahmed walked away from WPP to start over with Studio.One

“When WPP went down the road of consolidation and mergers, at that point, I felt that the best path for a very creatively led, values-oriented organization like AKQA would have been to have been spun out as an independent agency and taken private,” Ahmed tells The Drum. “But, you know, the powers that be obviously didn’t agree with me.”

On Thursday, Ahmed will officially open Studio.One, the new marketing agency he describes as a “direct rival” to “the slow, bloated, expensive agency model” of the holding company world he’s left behind. The Drum can reveal that he will also be joined at launch by two AKQA stalwarts: Ron Peterson, who spent 12 years at the agency, most recently as a managing partner, and Johnny Budden, who spent 13 years there, rising to global chief creative officer. They will not be the last AKQA alumni to join Ahmed’s “all-star team.”

Ahmed returns to startup life more than three decades after starting AKQA at the age of just 21. From AI to remote work to shifting client expectations, today’s industry is almost unrecognizable from the one he joined back then. As such, Studio.One is shedding many of the trappings of agency life.

“We’re not having timesheets because they’re completely unnecessary and ideas aren’t built by the hour,” Ahmed says. “We’re not going to have annual review processes because feedback happens in real time and feedback delayed is feedback denied.”

Nor will the company maintain a traditional HR department. “Culture and respect belong to everyone,” he says. And in a marked departure from his previous employer, the agency won’t enforce a return-to-office policy, either. “We definitely think that our teams will collaborate and be together. But often, creative people need to have solitude and focus time. People have got families and there needs to be that flexibility. We think that where talent thrives is where there’s trust.”

Like AKQA’s contemporaries Huge and R/GA, which recently extracted themselves from holding company IPG, Studio.One has taken private equity investment. According to Ahmed, being operationally independent but having the backing of Atrum Global will allow Studio.One to do things “that holding companies can’t do because of their structure and their motivation.” These include running an R&D lab testing ideas at “the cutting edge of culture and technology” and partnering with investment management firms as a brand consultant and potentially even a co-investor.

“We believe it’s a new era for independent agencies,” Ahmed says. “What seems to be the narrative in a lot of holding companies is that AI is going to be a replacement for a lot of human creativity and that’s not our perspective at all. Our belief is that there isn’t an algorithm for human spirit and that technology is our instrument. It isn’t our replacement.”

Ahmed spent 13 years within WPP after selling a majority stake in AKQA to the holding company in 2012. The deal, brokered under the particularly acquisitive leadership of then-WPP chief executive Sir Martin Sorrell, valued Ahmed’s company at $540m. But by 2020, under the new management of Sorrell’s successor Mark Read, WPP embarked on a period of streamlining its agency portfolio and AKQA was merged with the advertising agency Grey in a somewhat surprising union.

Having witnessed the often-fraught evolution of holding companies from the inside, Ahmed has come to believe they are no longer equipped to best serve clients or creative talent, who find themselves in “endless meetings” that “often have nothing to do with the clients.”

“A lot of holding companies have started adopting practices and systems from large conglomerates that don’t necessarily work in a creative environment,” he says. “If you’re a brilliant practitioner, you get promoted out of that role into admin and coordination. You stop doing the work that made you join the industry in the first place.”

Clients, he argues, don’t always get access to the talent they were promised. “There’s a lot of bait and switch. Sometimes the A or the B team will end up doing the pitch, but then the day-to-day service is done by the C team and that’s why there’s such a high staff turnover.” At indie startups, Ahmed says, clients “get direct access to the talent, faster decision-making and more outcome-driven solutions.”

Holding companies are trying to reinvent themselves, but Ahmed doesn’t believe change is coming quickly enough. “Some of the holding companies talk about how their transformation is three years away – well, the transformation is three years away and it always will be. And there are very few companies that have made the bold transformations that are required.”

One exception, he says, is WPP’s French rival Publicis Groupe, which has usurped it in the holding company standings. “Publicis has made those bold moves a few years ago and it’s being rewarded because it’s now in the Premier League. Maybe some of the other holding companies just haven’t kept pace.”

In an ideal world, Ahmed says, holding companies would conduct a “portfolio review” every quarter and be more proactive about divesting agencies that aren’t growing at the desired pace. “You would divest of those the moment where you could get a good valuation for them and you would then deploy that capital that you get in in faster growth areas, or to reduce some debt, and that would increase your shareholder value and make you a much more agile and streamlined and high performance company.” He pauses before adding: “I don’t think some of those practices exist.”

He points to the successful spinouts of VCCP, Finsbury and Kantar as examples of what WPP could have done with AKQA. “They’ve all achieved excellent valuations. Those case studies prove that it could be a good route to go down.”

That’s history now. But as Studio.One opens for business, Ahmed has a new opportunity to show he was right about the industry’s future. “I don’t think you can build something new by following the old rules,” he says.