One of the company building topics that’s surprisingly mystifying is PR — and only surprising since so much of the strategy and tactics behind public relations are actually hidden from public view. We’ve tried demystifying the topic in an ongoing series, covering everything from “the why, how, and when” of PR” and leaders building a personal brand to crisis communications.

But the most frequently asked question startup founders, especially technical ones, have is how to manage a PR agency — from when to bring one in and the mechanics of onboarding and engaging with them; to key acronyms to know in the process of doing so (what’s an AoR? RFP? GA?); to what are the ideal configurations for the who-what-where of in-house vs. agency PR.

So this episode of the a16z Podcast provides perspectives from both sides of the table (in-house vs. agency, big company vs. startup) for what it takes, featuring PR legends and veterans Shannon (Stubo) Brayton, chief marketing officer at LinkedIn (formerly at OpenTable and formerly vice president of corporate communications at eBay) and Margit Wennmachers, operating partner at Andreessen Horowitz who heads up the marketing function (and who co-founded and later sold The Outcast Agency), in conversation with Sonal Chokshi. It’s not dictation — whether from company to agency, or agency to reporter, or PR to internal stakeholders — there’s a lot of strategic thinking involved even with seemingly incidental things. And… it’s a leap of faith.

Show Notes

  • Definition of PR and the advantages of working with a dedicated agency [1:37]
  • Deciding when a business needs a PR agency [8:47] and various specialties [16:04]
  • Common terminology [20:39] and further discussion of agency types [26:07]
  • How to work with an agency [27:45] and how to choose the right one [31:45]
  • Advice around PR during and after an IPO [34:36]

Transcript

Sonal: Hi, everyone. Welcome to the “a16z Podcast.” I am Sonal. We talk about everything from tech trends to company building on this podcast, but one of the company building topics that’s surprisingly mystifying is PR, since so much of the strategy and tactics behind public relations are actually hidden from public view. So today, we cover the frequently asked question of how to manage a PR agency — from when to bring one in, and the mechanics of onboarding and engaging with them; to key acronyms to know in the process of doing so; to what are the ideal configurations for the who, what, and where of in-house versus agency PR.

Joining us to have this conversation, we have Margit Wennmachers, operating partner at Andreessen Horowitz, who oversees a16z’s marketing function — which includes brand and communications, among many other things. Before that, she co-founded and sold The OutCast Agency, which worked with some of the now biggest internet companies — then startups — and continues to work with leading tech companies today. And then we have Shannon Brayton, who is the chief marketing officer at LinkedIn. She has worked in-house in corporate communications at several prominent internet companies, including OpenTable —  which later IPOed — and formerly served as vice president of corporate communications at eBay. Together, Shannon and Margit provide perspectives from both sides of the table — in-house versus agency, big company versus startup — for what it takes to manage PR.

By the way, you can find more background and other topics touched on in this episode, including PR 101, crisis communications, and building a personal brand, in our podcast series. You can look under the public relations tag. But this conversation begins by quickly recapping the “why” of PR. The first voice you’ll hear after mine is Shannon’s, followed by Margit’s.

What PR is and why it’s important

Sonal: So how do you guys actually answer the question of, do they even need an agency or not in the first place?

Shannon: Well, I always start with, “What are you trying to achieve?” So, if you are there because you are trying to get users, PR is not the only lever you should be pulling, obviously. But if you are trying to get funding, or you’re trying to get acquired, or you’re trying to get someone else’s attention, PR is a good lever to pull, but you don’t necessarily need an agency to do that. <Right.> So it all depends on the objective.

Margit: Yeah. And if it’s early stage, PR can be very helpful, because it makes everything else easier, right? So it makes hiring easier. It makes fundraising easier. It makes everything easier, but there’s almost never a direct correlation. I mean, it’s like, I did this interview in Fortune, and therefore, I got these customers. It’s just not how it works.

Sonal: So you’re saying it’s valuable, but there’s not necessarily a direct immediate…

Margit: It’s hard to measure…

Shannon: It’s a leap of faith.

Margit: …on a spreadsheet.

Sonal: Right.

Shannon: It’s a leap of faith.

Margit: Yeah, exactly.

Shannon: I think the biggest tip I give people that ask me about this is, don’t expect to hire an agency and get results immediately, just, like, all of a sudden. You actually need to invest in the relationship both ways. The closer I’ve brought an agency, the better the results. The more I keep them at an arm’s length, the results just completely go downhill, and then the expectations and the relationship just starts to sour.

Sonal: But I have a question about this, because honestly, like, if I’m a founder and I’m busy trying to build a freaking company, for god’s sake — and in the beginning, you’re doing like 20 things at once, wearing 20 hats — I don’t have the time to manage an agency. Like, isn’t the point of outsourcing it to just not think about it?

Margit: An agency is ideally managed not by the founder, because as a CEO, you’ve lots of things to do, right? Like, you’re growing [the] company, you’re probably managing engineering still. Like, there’s just a lot of things to do. So ideally, you have someone with a lot of input from you who will help the agency be successful, and the other way around. And so, yes, you do weekly phone calls, and you share lists, and like, this, that, and the other, but it’s like, okay — building camaraderie and, sort of, the investment together. The agency can only tell the stories that they know, right? So if you are the founder that has that gene and understands, like, “Oh, this will be interesting to WIRED. That will be interesting to TechCrunch. This is not interesting at all.”

Sonal: Which almost nobody can do.

Margit: Like, that’s just — this is not a given that you have that skill. So, then, if you don’t, then you need to let that team in so that they can discover the stories and tell them for you. And then they do all of the story-finding, the fact-finding, the backup — like, who needs to tell the story, and all of that. And then they figure out how to map a particular idea to a particular person at a particular outlet who will be interested in that.

Shannon: And building the story is not, “Oh, hi, I’m gonna call you, and I’m gonna tell you the story, and then you’re gonna tell the reporter.” Bringing the person into your world and letting them help find it — experience your culture, get to know you a little bit better — that’s gonna make the story much richer.

Margit: Yeah, it’s not dictation. There has to be a story. There has to be some tension. Who is well suited to tell the story? What kind of proof point do you need, if any, right? So there was a dance.

Shannon: That’s, sort of, tip number one, right? Is, you have to be willing to invest in the relationship.

Sonal: …to invest that fund in the relationship. So there’s a real dance I’m hearing, but quite frankly, what I’m also hearing a little bit of — and just disillusion me of this — why would I even bother outsourcing this? Why not just hire someone in-house? Like, why do all this work if you’re saying it’s not dictation, you should be able to discover…

Margit: It’s totally legit. I mean, like, I don’t think Apple has really used PR agencies. There are models where you don’t have an agency at all. What we should do is dissect, like, how would you divide and conquer? Like, who is good at what? If you’re internal, you probably are — more of your time is often consumed with talking to the product managers and figuring out what the roadmap is, right, and doing all that. Finding the stories, making sure that everything moves forward, doing all those meetings, right? And you don’t have any of that when you’re on the agency side, right? Your time is taken up with talking to reporters all the time because you have multiple clients. And as a result, you know stories that are kind of outside of scope. And that’s interesting to a client. Whereas, like, you know, it’d be good for me to know if WIRED is doing a cover story on AI.

Sonal: So you’re saying, an agency, in that context — that person has the time to really keep their tabs on what the reporters are doing all the time, essentially.

Shannon: Two things I think when it works really, really well. So one is when you’ve got way more program dollars to spend, and you’d rather do that than bring on a headcount, which is much more of a fixed cost. So a CFO, actually, a conversation with the CFO is typically, “Oh, an agency sounds like a great model instead of hiring three people that may be very, very hard to manage, and then potentially have to exit at some point.” Number two, if you get the phone call, “Hey, we’re gonna launch in India, but we’re actually not gonna put an office there or a country manager, and we just need some arms and legs on the ground,” that works beautifully, to be able to find an agency in the network, and call up and say, “We really need your help with project A, and if it works out, we’d love to keep you on.”

Sonal: So that’s more like more specialty-type things.

Margit: Yeah. You can dial up and down. And so, particularly, you know, once you’re a really established, high-growth company, you wanna grow the team, you want all of that. But, like, when you’re not in that stage, an agency can be super, super effective.

Sonal: So I hear the thing on — that specialties may vary, and that some of the media relationships may vary. But are you also, guys, saying then that people should outsource their media relationships to their agency? Or do the in-house people also still invest? Like, how do you, sort of, divvy that bit up?

Shannon: I think it really depends on who’s got the relationship, and there should not be pride of ownership.

Margit: No.

Shannon: If the agency has the better relationship — like in Margit’s case at OutCast, they probably had way better relationships with reporters than half their clients. The client has to be willing to say, “Margit, I’m fine with you calling Quentin Hardy. I don’t need to do that.” And not having that conflict of interest between the two, it should really be whoever’s got the best relationship.

Sonal: Right.

Margit: And at the same time, I think it’s really important for internal folks to be talking to the press. Because you kinda lose touch. What is even a good story? What are they thinking? Like, what’s kind of in the water? And not knowing that at all is just really detrimental. However, do you need to be booking all of the appointments, or do you need to be working on every story? Probably not, right? So it’s a balance.

Shannon: And the internal team, too, gets a lot of G-2 on other companies by talking to reporters directly, too, if they build the relationships.

Sonal: What’s G-2? Sorry.

Shannon: Some information about other companies. What’s happening in the Valley, in the industry, just intel, in general. And so I think you don’t wanna ever have the agency team do all of it at the exclusion of the in-house team. They should have their own.

Sonal: It’s like you’re basically not outsourcing your insights and your connections, but you are trying to scale what you do, and leverage where you don’t have specialties, etc.

Shannon: Right. Without potentially fixed costs.

Margit: I remember being in situations where the reporter won’t tell the company directly, like, what’s up, but they’ll tell you.

Sonal: You’re the inconvenient messenger.

Shannon: Or like a conduit.

Margit: And then on the client side sometimes, sometimes it’s really nice to have an agency walk in and deliver a particular message, versus you do.

Sonal: I’ve actually heard the best definition of consulting, in general, is that they’re the people who will say what the internal people think all along but just don’t get across.

Shannon: This is why I love letting agencies do media training, too, because agencies can really tell a CEO, “Actually, you look like a complete dweeb,” or, “This message completely did not resonate,” where the employee sometimes has a harder time landing that message.

Overview of PR specialties

Sonal: So, we’ve been talking so far about common configurations for working with an agency — like, having it in-house and an agency. Let’s switch and talk about timing. When should you bring an agency in or not? Now, one assumption — maybe this is a good assumption, I’ve heard — is that a lot of times, in the very early days of a startup, at least — you don’t have any hires, you just need to launch an announcement out. Is that the time to bring an agency in, or should you be trying to hire?

Shannon: I think an agency, to come in at the very beginning and talk about the company’s narrative, and what are your value props, what are your market fit, and who are the people running this company — super, super valuable to have an agency help you do that, without having to hire someone at the outset.

Margit: I totally agree. One thing that I’ve learned in working with a lot of startups is that you need to, like, strip all the language that we are used to, because they can’t hear it. So, for example, a CEO will call and say, like, “We’re launching soon. We need to have an agency, you know. Like, can you arrange the launch?” And then, oftentimes, people say, like, “Well, first thing we need to do is we need a messaging positioning, blah, blah, blah,” and they just hear, like, “Blah, blah, blah, dollars, blah, blah, blah, dollars,” and none of it means anything to you. Try to work backwards from where the CEO is. Okay. So, when is the product ready? You know, it’s all different, whether it’s consumer enterprise, right, like, and work back from there and go, like, “Well, if you wanna have your launch date be that, that means you’d have to be on the road doing interviews then, and then before that.” Just kinda meet them where they are, and try to strip out all the technical lingo out of the thing, because that’s like engineer talk.

Sonal: It goes back to starting with what the goal is.

Shannon: Right. And one of the things I’ll ask people, too, at the outset is, what is your desired headline? Let’s think about your dream cover story. What does that say, and what is the headline? And then you get a really good view into what’s going on when you ask about the absolute dreaded headline, because you can actually glean what is potentially underneath that you’re not necessarily being told.

Sonal: Isn’t that a little bit dangerous also for them, though, in terms of mixed messages? Because a lot of funders, especially those who haven’t done communications and marketing before, they assume that, “Oh, I’m gonna say this. This is the truth. This is the message. There’s no variation from this.” It’s like logic, not story, which has multiple flavors of interpretation.

Margit: And so what you would do is, like, you basically are taking them on the journey with you, right? If they say, like, “I want the headline to be, like, we have the best search engine technology on the planet.” And you’re like, “Okay. Well, then, how — like, what would the reporter need to come to that conclusion, right? And so then you walk — again, you walk backwards with them where you have them go substantiate the story. And then, if you can’t, then you’re discovering that together, right?

Shannon: You don’t commit to the headline, but you basically say, “If this is the type of story you want, here’s all the stuff I’m gonna need to be true in order to help you go for that.”

Margit: And don’t trust an agency, ever, that will promise you a headline or a story or any kind of outcome.

Sonal: So how does the life cycle of a company look? And if you could set up an ideal model, is there an ideal model?

Margit: So, like, an example — you’re basically an established person with an established career in Silicon Valley, and all you wanna do is, you know, put out something that you’re working on something, so you get an inflow of, like, talent and, you know, investors knocking on the door, and whatnot. And you just wanna be very efficient about it. You probably have a relationship with a reporter, and you pick up the phone, he’ll assign it to someone. You do this one story and off you go. And then you go back into stealth, and you’re done. Like, you don’t really need an agency.

Sonal: Then what would the next inflection point be to bring in an agency again, or to have one on a regular basis?

Shannon: I’d say a huge influx of media inquiries coming to you, because then you realize, “Actually, this is getting out there, and we’re not controlling the story.” So I think if you’re getting, you know, 5 to 10 a month, you’re probably at a point where you may need an agency to help you manage through that.

Sonal: So when you get a lot of media inquiries, other inflection points.

Margit: There are companies that, like, really don’t have any profile, and they’re thinking of going public. I would say, you have left money on the table if you find yourself in that position. Because there’s not that much you can do. Like, once you meet with bankers, you’re on a quiet period, so you can’t really be doing anything, right? So, if you are a company where there’s product-market fit, the company is growing, things are going well, you’re thinking of — if it’s an enterprise software company, another office somewhere — you have a management team, right, and you’re thinking like, “You know what, we should get the CFO in the door, because in the next two years, we wanna be in a position that, if the market is good, we might file.” You definitely need to get a PR firm in yesterday, because you only have a very short window in which you can do anything at all before you go quiet again.

Sonal: That’s actually rather counterintuitive, because I would think that you would want PR when things aren’t going very well, but it sounds like you’re saying, actually, when you have traction but a low profile, right.

Margit: You want a different kind of PR.

Shannon: That’s right. And that’s the next infl