Hill+Knowlton Strategies (H+K) bought JeffreyGroup, an independent firm that Jeffrey Sharlach founded in 1993 with the idea of offering public relations services from Miami, without imagining that three decades later it would employ more than 300 people and become a benchmark for corporate communications, public affairs and marketing consulting in Latin America.
The incorporation of JeffreyGroup to the international network of Hill+Knowlton will allow this company to double its presence in the region, since, with headquarters in Miami and offices in Mexico City, Brasilia, Rio de Janeiro, São Paulo and Buenos Aires, JeffreyGroup has been a dominant player in Latin America for nearly 30 years.
“One of the reasons we’ve been successful all these years is because we’ve been able to change over time. The Jeffrey Group of 30 years ago was a very different agency. We used to get newsletters out by fax. Today we are much more strategic advisers, we have evolved to be a completely different business than we were in 1993. And for me, this transaction is part of the evolution. The next chapter for JeffreyGroup will be one of the most exciting,” said Jeffrey Sharlach, founder and president of JeffreyGroup.
Expansion (E): How did you start JeffreyGroup?
Jeffrey Sharlach (JS): Well, it’s been so long since I started JeffreyGroup that I can’t remember. JeffreyGroup started 30 years ago. I started the agency as a business idea because I am not fluent in Spanish or Portuguese and have no history in Latin America. But he had been working for a large agency, in international public relations, and believed that there was a great opportunity in Latin America for a company like JeffreyGroup.
I was living in New York, quit my job, moved to Miami and started JeffreyGroup out of my Miami apartment. The idea was not to create a large agency with hundreds of employees. The idea was to go to the beach in Miami, while teaching, writing and consulting under the name JeffreyGroup.
But actually I had a lot of work and I didn’t have time to go to the beach, and I didn’t have time to write my book. In fact, I had started teaching at the University of Miami, but had to drop out because I was too busy with business. For 30 years it has been a very exciting journey and today we have more than 335 employees in four countries. And I think the next chapter that we’re starting is going to be very interesting for JeffreyGroup.
I: What kind of challenges did the company face?
JS: We have had many challenges going through many crises in Latin America. Argentina’s financial crisis in 2001, which was the same year the internet bubble burst in 2001. It happened on 9/11. We went through a lot of strikes and earthquakes in Mexico, as well as other problems. And when things seemed to calm down in Mexico, something happened in Brazil, and when things calmed down in Brazil, something happened in Argentina. So I think it is a region of the world in which there are many changes and it is very dynamic.
One of the things we have seen over the years is that JeffreyGroup’s commitment to Latin America has never stopped or changed. And for other big agencies Latin America has always been a small part of their business, but for Jeffrey it is 100% of the business, so we have always focused on the region and maintained our commitment through thick and thin. I think that’s something that customers really appreciate.
E: Why did you decide to be part of Hill+Knowlton?
JS: There are many reasons. We have been an independent agency and very successful that way. And I think one of the things that happened was that almost every major agency expressed interest in acquiring JeffreyGroup over the years and I always said no, I wasn’t interested or it wasn’t going to be a good thing.
But this time with Hill+Knowlton it was a very powerful opportunity for me and for the company. First of all, they are very respectful of the style and people of JeffreyGroup, of the reputation we have in Mexico and in Latin America. So the JeffreyGroup brand is going to continue. Everything that has made the agency successful for three decades will continue. And that was very important to me because when you start a company from scratch it’s like your baby, you know what I mean, at some point you have to let go of your child, but you want to do it in a way that it continues to grow and thrive.
The other thing that was very important was the commitment to the people. And that’s something I share with Hill+Knowlton being a very people-focused agency. In this operation that we are going to carry out, all the people will keep their jobs. And we’ve also opened up a lot of growth opportunities for our people, because we’re now part of WPP, one of the largest advertising and communications companies in the world.
And finally, it also gives customers access to more resources, because the reality is that in our business technology, digital, all of these things are becoming more important. And by working with WPP we now have access to the most innovative cutting-edge technology.
E: How much was the amount for the transaction?
JS: No, we cannot disclose the terms of the transaction, it is confidential.
E: After the purchase, what will your business model look like?
JS: Our business model is not going to change. Brian Burlingame took over as CEO of Jeffrey in 2015 and will continue. And our executive directors, Mauricio Gutiérrez here in Mexico, will continue as executive director. He is also our regional director of strategy and that is going to continue and I am going to continue as the president of JeffreyGroup.
Brian will report to H+K Americas CEO Richard Millar and join the H+K Global Leadership Council. He will also become the CEO and leader of Hill+Knowlton Latin America. As part of that process we’re going to try to take the best practices we can from both agencies, so they can continue to grow to their full potential. The transaction will be successful and in fact we hope that the opportunities will increase, so when we put one plus one together it will be much more than two.
E: But then, what changes will customers perceive?
JS: Clients are going to have the same account team. For our team there are going to be some changes, but they will be in the administrative part, there will be new accounting procedures, since we are now part of a publicly traded company. WPP’s headquarters are in the UK, so we’re going to have to follow public accounting procedures that we didn’t have previously. We followed all the ITA standards, but we didn’t have to publish our results publicly.
And for the team, growth opportunities will open up that they didn’t have before. WPP is made up of 109,000 people in 110 countries. Jeffrey has 330 people in four countries. So a lot of opportunities open up for our employees and I think it’s something positive because people want to develop their careers, they want to move, they want to work to learn. What we’re doing today is a transaction that creates a lot of opportunities for all of those things.
E: What is your vision of the future and what do you hope to achieve in the coming years?
JS: Brian Burlingame, CEO of JeffreyGroup, and the management team have many plans for how the agency can continue to grow. Through WPP you will have access to many more global resources than ever before. Going forward, I think communications will continue to be a very vital part of business success for any company. I mean, if you have the best product in the world, but you don’t have effective communications, you’re not going to be successful.
E: What do you think about the competition in your industry?
JS: There has been a lot of competition in our industry, but the good thing is that the demand for communication services has continued to grow and grow. So the fact that it is a growing sector means that there are plenty of business opportunities for everyone. Although there is a lot of competition, we are not stealing business. There are many more business opportunities than have ever existed. In other words, companies are very aware of how important communications are to having a successful business. These days you can’t have a successful business without having an effective communications program.
E: As an entrepreneur, what inspires you and how do you make your business decisions?
JS: Sometimes people ask me, what is the main reason for my success. Well, if you mean success in business I should say that the main reason is because I hire very smart people. When I started with JeffreyGroup I always depended on other people to make the agency successful. And I have been very fortunate to hire and work with a great management team for decades.
What has been exciting for me is creating JeffreyGroup from scratch. And what inspires me today are all those people working at the agency throughout Latin America. Maybe one day I was an inspiration to them, but today they inspire me. And one of the things I always tell them is that it’s not about JeffreyGroup anymore, it’s about the whole group.
E: What kind of books do you like to read?
JS: I have to say that I’m not the kind of person who reads business books. When I read, I often read something that takes my mind off business. But I love reading, I really enjoy reading. One of the things about me that no one who works with me is going to tell you is that I’m not a very patient person. I do not have much patience. And that is why sometimes it is very difficult for me to watch movies or television, because my mind always goes very fast. That’s why I like to read, because I can go as fast as I want and it keeps me busy. I usually read more fiction. And if you ask me what the last business book I read was, I’m not sure I can tell you what it was.