Growth Capital: Maths men are making it ad up nicely, thanks to all things digital

Maths Men, armed with algorithms and smart technology, are challenging the creative Mad Men who used to reign supreme in the advertising industry. For proof, look no further than the co-founders of fast-growing London digital agency Essence.

Matt Isaacs, 42, is a former management consultant while Andy Bonsall, 38, and Andrew Shebbeare, 35, worked in financial services. None had been in the ad industry before they set up Essence. Yet nine years later, they are running an advertising business with 470 staff from Singapore to San Francisco, and a client list boasting Google, YouTube, eBay, Expedia and Betfair.

Revenues shot up more than 50% to £35 million in the last financial year and are on course to do the same this year, with turnover forecast to hit £50 million. “It’s moving so fast,” says Isaacs. “Internet marketing is relatively well-established. But areas like mobile and online video are still being invented. It’s changing all the time.”

Essence specialises in all things digital from search marketing to social media advertising, from building websites and apps to running e-commerce, from data analytics to automated ad-buying. Globally, it manages about £400 million a year of digital ad spend.

“We’ve been built from the ground up,” says Isaacs, explaining how Essence has always focused on digital, rather than worrying about defending existing business models based on “old” media such as TV and print. “It’s been a challenge for the legacy agencies,” he adds as he sits in Essence’s understated offices off Oxford Street.

Shebbeare adds: “To examine things from the outside has been a big advantage. It’s allowed us to develop ways of working, systems, ways of recruiting that are completely different.”

The trio, all from the Home Counties, got the idea for Essence when they worked together at Accucard, a credit-card company backed by Lloyds TSB, where they developed an in-house digital marketing arm.

They launched on their own in 2005 and got a break from Carphone Warehouse boss Sir Charles Dunstone. Carphone’s website was struggling at the time, with bad layout and a poor conversion rate for sales. “Carphone’s IT department said it would take two years to fix,” recalls Isaacs. “We said three months.” Dunstone went on to give them a roving brief to improve digital operations. “Charles is entrepreneurial to his core,” says Isaacs approvingly.

Essence was profitable from the start, with no need for debt or investors. 2008 was a watershed. Smartphones and social media were taking off while the financial crisis meant clients were scrutinising costs. Essence was well-placed because, as Isaacs puts it: “Digital marketing is highly accountable compared to other forms of marketing.”

Winning Google as a client helped. “In 18 months, we went from a predominantly UK agency to 75% of the business was international — it was very dramatic,” he recalls. “It is now 85%.” Essence now has about 250 staff in London, which serves Europe, with 200 in North America and 32 in Asia.