FAST 50: THE RIGHT CHEMISTRY

Showtime started at a Pittsburgh advertising agency 15 years ago, and the guiding premise that propelled it across the country — big-brand clients and coveted industry recognition for creativity and results — hasn’t changed.

At Chemistry, it started and stays with people, plain and simple. The evolution of the business, whose roots go back to 1978, revolves around the company’s now 292 employees (158 are at its downtown Pittsburgh headquarters) and the clients they serve.

“We didn’t start the company with a spreadsheet to be X revenue, X people, X profit,” said Ned Show, Chemistry’s chairman and CEO. “For a creative business, you get into trouble when you do that. Our goal was to be the best independent agency in the country, a pretty lofty goal for an agency in the Strip District (the location of the firm’s Pittsburgh office at the time). Successful organizations carve out a culture and a path to what they want to be. We started with being a place where people wanted to work.”

Chemistry is No. 1 on the 2024 Fast 50, the Business Times’ annual ranking of the region’s fastest-growing private companies, posting a whopping three-year growth rate of 360.84%. The firm had $39.98 million in revenue for 2021, and revenue more than doubled from 2022’s $72.16 million to 2023’s $184.24 million.  

Mergers and acquisitions took Chemistry’s physical footprint into the advertising hotbeds of Atlanta and Miami, and it opened an office in the industry’s capital city, New York City. Retaining employees, expertise and clients were part of the formula, with national recognition being the fudge sauce on the sundae, including awards such as making Ad Age’s prestigious A-List in 2023 at No. 6 after being hailed by the industry publication as a Small Agency of the Year in 2016, 2018 and 2022, and Adweek tagging Chemistry as a 2022 finalist for Midsize Agency of the Year.

“We were put on the radar screen of companies that four or five years ago probably didn’t know we existed,” Show said.  

To truly appreciate how far and fast Chemistry has come, look back to its beginning.

Show had worked at a series of Pittsburgh’s largest advertising agencies since 1992 before teaming with a handful of veterans from Labwerks, a Lawrenceville-based web design firm, to launch the digital shop SpaceBoy Interactive in 2007. Gray Baumgarten Layport was a creative boutique founded 30 years earlier that ranked among the region’s biggest agencies. When the founding name partners retired in 2001 and a new generation of management took the helm, it was abbreviated to GBL. 

For over a year, startup SpaceBoy shared GBL’s offices while retaining a separate identity so it could pitch clients independently. But then in summer 2009 GBL and SpaceBoy combined, with Show as the top executive. It was time for a new name.

“We just circled around the idea of what, at the end of the day, makes client and agency click,” Show said. “Why do they find each other and work well together? It’s intangible. But you know it when you have it. It’s all chemistry.”

Chemistry’s C-suite illustrates the growth components that propel the agency. Tim Smith, chief marketing officer and president, came aboard via its 2016 merger with Atlanta agency Breensmith. Earlier in 2024, Taylor Grimes joined as chief strategy officer from the revered The Martin Agency. And Dan Dehner, formerly of SpaceBoy and Labwerks, has been chief interactive officer since Chemistry’s start.  

“Dan is hands down the smartest digital marketer you will ever meet and an equally amazing human being,” Show said. “Dan has been a driving force in the company’s growth and guided the work that resulted in our first ever Effie Award for Marketing Innovation this year.”

The Effie is “the end-all, be-all of advertising,” as far as Show’s concerned, and he views the award as a punctuation point for Chemistry. A win shows the market the agency can move the needle so clients achieve their goals. Chemistry’s Effie was for client Frontdoor Inc., a publicly traded company in the home warranty business. 

“We created an online app for them,” Show said. “We won the award for making innovative, overlaying technology and creative to launch the brand. It was gasoline on the fire.”

The agency now is made up of five operating units. There’s the flagship Chemistry, provider of integrated advertising services. React Digital, formed in 2022 by blending Chemistry’s digital staff and leadership with the acquisition of Image Box, focuses on digital marketing and web and app development and is based in Pittsburgh. Chemistry Cultura, which centers on U.S. Hispanic public relations and advertising, was created through Chemistry’s 2020 acquisition of Miami-based agency Pinta. Test Tube Productions, centered on commercial and social media production, and The Market Research Lab (2020), created to obtain data “at a fraction of the old focus group cost,” Smith said, are both housed in Atlanta.

“If we think we can serve a client better, we will create something to do it, and we love giving it a Chemistry-related name,” Smith said. “When I started in advertising, it was all about big TV and Super Bowl spots. As a smaller agency, I never imagined we would have our own production company. But technology made it possible, and we launched Test Tube about five years ago to handle everything from broadcast productions to experiential, social and radio nationally and internationally for clients like Netflix, Beyond Meat, NBA, Auntie Anne’s, Carvel Ice Cream, Cinnabon, Jamba, McAlister’s Deli, Moe’s Southwest Grill and Schlotzsky’s.”

The credit for growing Test Tube, Smith said, goes to Renee Williams Royal who was recently named its president, leading a diverse team that’s more than 70% women. Test Tube and Williams Royal’s role also ties to Show’s commitment to attracting and retaining talent by enabling Chemistry employees to build and develop successful careers within the agency.

“People have career paths; they see ways they can move forward, work with bigger clients,” Show said. “If you create an ecosystem for them, they’ll stay and work really hard.”

Grimes had been contacted by a recruiter about the Chemistry CSO role. He is based in Richmond, Virginia, and the ability to work remotely was a plus, but it was Chemistry’s work, reputation, culture and potential that attracted him.

“Getting back into strategy was high on my priority list and not possible at that level at Martin,” he said. “They [Chemistry] were on our radar because they had beaten us on the A-List the prior year. … I wanted to contribute more to the growth of an agency, and Chemistry was right on the verge of jumping to the next level.”

Show noted that Chemistry has been “fortunate and purposeful” in building relationships with clients. 

“We’re a service business, and we’ve always had a strong commitment to building relationships beyond a transactional level where we become partners with them,” he said. “When you invest in relationships with really smart people, they tend to move on to new organizations and get promoted. People we started  working with 15 years ago continue to call us.”

Expanding the footprint was crucial.

“From day one, I and the other partners here had a clear vision that if we wanted to grow the company, we needed to look at other geographies,” Show said. “Pittsburgh is home, but as an advertising market, it’s where it was 25 to 30 years ago. Atlanta was on fire, a big market with a lot of interesting brands; I call it the New York City of the South. Miami is the epicenter of U.S. Hispanic culture. And New York is the capital of advertising in the U.S.”

Atlanta and Miami have been instrumental in attracting clients. New York has been “tremendous in finding talent,” he said, and having a presence there enables Chemistry to have talks and conferences. 

A West Coast office is a distinct possibility. Los Angeles/San Diego is also crucial to the Latino market — while Miami tips Cuban and South American, southern California is a huge base for the Mexican market.

“We’ve had conversations over the last year and a half over a more significant investment on the West Coast,” Show said.

How big Chemistry will or wants to become is tough to answer. Show doesn’t cite size goals and, in fact, believes bigger isn’t necessarily better from customers’ perspectives. He said more clients across the country are gravitating toward smaller independents and that this wasn’t the case 10 or even five years ago.

Grimes agrees.  

“Clients are looking at the agency landscape, the new tools, the new rules for success — and asking how they can navigate all of that with a flexible partner that isn’t going to drop them into the machine and churn out whatever AI and synthetic data say is best,” Grimes said.

That’s not to say Chemistry is against those new tools.

“I think they will help small agencies compete with big shops, but we have a deep respect for the thing that’s always worked: Doing the hard work of solving a business problem with creativity,” Grimes said. “That’s what’s on their mind day-to-day — at least the creative-oriented marketers we want to work with — and that’s what we, and independents like us, offer. Also, we’re cheaper.”