The deal, which completed in the last week of December, marks the first major acquisition by London-headquartered The Specialist Works since the management buyout (MBO) of the agency in August 2018, and forms part of its long-term business growth strategy to expand into the North American market.
Connections is a platform that enables advertisers looking to acquire high volumes of new customers to connect with retailers looking to monetise their e-commerce packages.
The marketplace benefits direct-to-consumer and consumer-packaged-goods brands who want to find retailers that will offer their customers special discounts or product samples.
The Specialist Works will build on the capabilities of the marketplace to augment its existing US offering that includes TV, print and digital media planning and buying alongside print management.
The Specialist Works chief operating officer Parry Jones told Printweek: “We partnered with Exact Media early last year. Our strategy is to partner with like-minded businesses who can add value to our client base.
“Every now and then those partnerships turn into something a bit more, and this just felt of real value to our existing client base but also gives us access to some exceptionally good clients that we were keen to work with, so it was just a really nice fit.”
He added: “We’ve acquired the Connections platform and the clients, the advertisers and the retailers within the platform, and it’s going to be rebranded as Connections by The Specialist Works.
“We are creating a global network, and this is the next step in creating that. The modern direct-to-consumer business is going multinational much quicker than it ever has before, which has inspired us to go international.
“So this is absolutely the best opportunity for our UK clients to expand their businesses in the US, and it’s a very natural journey for them to go on because this is an English-speaking market who tend to live UK brands and there is enormous and exciting scale there.”
More than 170 retailers currently use the Connections platform, including HelloFresh, booking.com, Harry’s, P&G, PepsiCo and SC Johnson.
Connections investors Tony Hsieh (chief executive of Zappos), Joshua Schachter (founder of del.icio.us) and Rho Capital remain shareholders. Its co-founders Ray Cao and Daniel Rodic are departing the business but will remain as external advisors to the executive team.
Cao said: “We have long admired The Specialist Works for what they’ve been able to do as pioneers and global leaders in the inserts market.
“With The Specialist Works’ infrastructure and management team, we feel confident that Connections is now positioned for rapid expansion. We look forward to seeing where The Specialist Works takes Connections next and we will remain close to the management team.”
Turning over £120m, The Specialist Works provides media planning and buying, data science, brand partnerships and creative services.
It currently employs just under 200 staff, including around 170 in the UK, with other offices in the US, Europe and China. Its clients include Carter’s, 23andMe, Headspace, Wayfair and Boohoo.com.