“Please Be Precise”: Sir Martin Hates Business Models
Sir Martin Sorrell, the CEO of WPP, hates the phrase “business model” and made it very clear at the DLD Conference in Munich, Germany last week. He asked panelists at a video startups panel, rather pointedly (as recounted by Randall Rothenberg, CEO of IAB, on his blog): “If there’s a phrase I loathe, it’s ‘business model…In my company, we have 102,000 people working in 106 countries. Our world is made up of revenues, costs, profits, and cash flow. I’ve heard a lot from this panel on what will be. But we do an enormous amount of business, much of it growing, with broadcast and cable television networks around the world. Can each panelist precisely say what their revenues, profits, and cash flows are today, and what they will be in a few years? Please, be precise.” Unfortunately, almost no one was, write Rothenberg. The panelists, in case you’re curious, were Dina Kaplan, co-founder and COO of Blip.tv; Suranga Chandratillake, CEO of Blinkx; Niklas Zennstrom, co-founder of Joost; and Patrick Walker, head of content strategy and partnerships for YouTube in EMEA.
Sir Martin wrote about this incident on his Davos blog on Telegraph, where he said: “When asked what revenues, costs, profits and cash flow are, few respond coherently. The odds of success are still 1 in a 100, as General Doriot used to say. Sometimes it seems that its sardines for buying and selling, not for eating!”
Posted In: Advertising, martin sorrell
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Comments (3)
Jan 28, 2008 3:36 AM
I think Martin Sorrell, head a company with 102,000 people working in 106 countries, slightly misses the point of a startup. Asking early stage startups for this precise information is meaningless - Blip, Blinkx, Joost and evenYouTube are not mature profit and loss type businesses. Whatever Sorrell might think about them, that isnt’ a shameful situation to be in.
Jan 29, 2008 1:49 PM
I think its possible that his demands reflect a certain amount of frustration in the ad and marketing world right now. Everything is changing. And things are changing so fast, i think he’s simply asking the same questions ‘his’ clients are asking (demanding) of ‘him’ right now. And more than ever, ‘his’ answers are not as precise as they used to be able to be. Not as predictable. Everything is changing so fast - technologies, viewer habits, everything. And as fast as things are changing, the meaningful things, the quantifiable things (i.e. what my ROI if i buy ad HERE) aren’t changing fast enough, especially in the online space. If i were blip, blinx, joost or youtube, i wouldn’t take it personally.
Jan 29, 2008 4:17 PM
No wonder WPP can’t recruite any decent digital talent. Who would want to work for that guy? Can you see him taking to Larry and Sergey in the 2002? Sir Martin would tell them to go fly a kite and 36months later they would generate eneough free cash flow in a month to buy WPP.
The best digital guys never make statements like Sr Martin’s to entrepreneurs, but instinctively know when to cut and run if an idea is not going to fly.