Step 1: Start-Up

At 6:15pm on Friday, May 13th, 2005, Chris and I turned off the lights, set the alarm, and left the Chicago office of the Whitehouse for the last time.

It was the culmination of a plan we had laid out eleven years before when the idea of starting an international film editing business had first entered our consciousness.

Our goal had been to build the best film editing company in the world. We reasoned that if we were going to work every day at something, there was no reason to aspire to be less than the best the world had ever seen. We might not get there. But we should try.

We defined best on a variety of levels. Quality of work; financial performance; career opportunity for staff; honesty; transparency, level of service. We wrote them down and worked to hold onto those standards every day for eleven years. We measured our progress against them relentlessly. That gave us the framework we needed to stay on track through all the good times and bad.

We were also guided by a Terence Conran quote that Chris wrote on a sticky and stuck on her office phone. “Stay humble and nervous.”

In October 1994 we left our jobs at DDB Chicago and formed The Lookinglass Company - a small Chicago film editing boutique - with a lot of financial backing from an angel investor. There were many things that were incredible about that relationship. And a few that, over time, got in the way.

That's true of every relationship based on money, and the more you can think the issues through up front, the longer the relationship will work for both sides. The challenge in all aspects of running a business is to know what you don't know. And that can be expensive knowledge to acquire through experience.

One thing we never forgot was that we were in a service business, and we spent a lot of time talking to our clients about their problems. We also never lost sight of the fact that our success would be determined by our ability to solve their problems. Not our ability to solve ours.

To claim that we foresaw every issue and every obstacle would not be true. But whenever we were confronted by something unexpected we had a philosophy and a frame of reference by which to approach it. That gave us the confidence to make decisions and the confidence to make mistakes. In either case we knew we could learn something because we had a plan against which to measure the results. When it comes to analyzing information, context is everything.

"You have to see where you’re going before you can see where you’re not."

We went through a lot of the typical start-up pains, and a lot that were less typical. We learned the difference between cash flow and profitability, that not all employees were equally capable of the same level of growth no matter how much we believed in them. We discovered the benefits and downside of bank loans versus investor loans, of having beautiful - and expensive - office space, of working with friends.

We came to understand value engineering. We were given a hard lesson in the importance of recognizing and maintaining leverage in any negotiation. We saw that the work of a logo designer can impact the work of up to a dozen other suppliers, and we learned the cost and benefit of thinking through each and every one of those steps.

We thought through every detail. We thought.

Until we got a call that a client was actually going to hire us for the first time and were on their way over. Suddenly, we took stock. We had the windows, the wiring, the rugs, the computers, the cables, the labels, the phones, the pencils, the paper, the heating, the cooling and the invoicing numbering sequence.

What we did not have were any coffee cups.

As we ran out to Crate and Barrel, we had no idea what lay ahead. What if this turned out to be our one and only client? What if we had just opened a very beautiful mausoleum.

Either way, we were in business. With a paying customer.

At least we could say that much.

Step 2: Expansion

The first year went by in a blur. A few signs of optimism. A lot of anxiety. But through it all we really did act locally and think globally.

We had hired David Brixton, a very talented editor from London and convinced him and his wife Jemma of our dream. They moved to Chicago and brought European flair, creative credibility, a work ethic that matched ours and extraordinary social sensibility.

Chris and I were never comfortable in big crowds. But we knew we were powerful in small intimate social settings. So we started inviting potential clients to our home for dinner. I can honestly say we never invited any one we didn’t already like. But we made the effort consciously. As Woody Allen says, though not as often as I repeat it, “ninety percent of life is just about showing up.” We found a way we could show up that was comfortable to us.

The business grew. We advertised nationally and acted as though we were who we wanted to be. “They became what they beheld” is another quote we lived by. Quotes are micro philosophies. I’m a fan of both.

Things were good and getting better. But, we knew we were never going to be ‘the best editing company in the world’ (“tbecitw”) sitting in Chicago. So we asked David and Jemma if they would consider moving to Los Angeles.

A quick contract renegotiation later - LA is very much more expensive than Chicago - we opened a small office in Santa Monica, and threw the resources of our small but growing company behind them. (Ultimately we came to establish formal cost of living factors in all four of our offices so we had a transparent and fair foundation for all employee moves).

We didn’t discriminate based on where an opportunity came from. We simply allocated resources to support it. We developed proprietary information systems that supported both offices seamlessly, established a philosophy for travel policies so we could manage costs and expectations pro-actively, and then added technology to support our commitment to ‘fluidity’ - a catch phrase I adopted to define our method and our expectation both internally and publicly.

We made many, many decisions based on whether they made us more or less ‘fluid’ as a company. And if you look at the Whitehouse to this day, you’ll see fluidity coursing through its veins.

We gained local traction in LA thanks to having smart and committed people on the ground who embodied our original philosophy, and then added their own personality and experience to bring it to life. We got better work, attracted more attention and then reached the tipping point with the addition of two significant local talent, film editor Livio Sanchez and Executive Producer Sue Dawson. They both agreed to join us on the same day. It was the day I knew we had reached a new level.

Two years later Livio edited the original “Whassup” campaign for Budweiser on the back of his passion for the short film on which the work was based and on my personal relationship with the agency producer in Chicago. “Whassup” infiltrated every home in the Western hemisphere and won the Grand Prix at the Cannes Advertising Festival as the best commercial in the world that year.

We had arrived.

Step 3: Merger & Acquisition

As a very junior account executive at Ogilvy & Mather, I heard Kelly O’Dea - who went on to become President of three different worldwide ad agencies - describe trying to get to a new business presentation in Miami from a snowbound New York. With every airport in the Tri-state area closed, it was apparent that the Ogilvy team wasn’t going to make it in time. “We’ve tried everything,” Kelly was told. “You can’t get there from here.”

Kelly paused and then said, “where can you get there from?”

The answer, it turned out, was Washington DC. I can’t remember whether they won the business. It doesn’t matter. What matters is they knew where they were going. And they knew where they were.

The rest is a matter of geometry.

By early 2000, The Lookinglass Company was, by any measurement, successful. We had fifty employees, two offices, serious profitability, award winning work (including editing the best commercial in the world that year) and great office parties.

We were not, by any measurement, ‘the best film editing company in the world', however. And the truth, as I was becoming increasingly aware, was that we couldn’t get there from here.

Film editing companies are fueled by the creative quality of the projects they work on. In the advertising industry, those commercials rarely make you any money. They do, however, make you aspirational to potential customers. And aspiration is a powerful metric in building customer loyalty.

Which brings us to the Whitehouse.

The Whitehouse in 2000 was a London based film editing company owned by three of the best film editors in the world. Rick Lawley, John Smith and Andrea MacArthur. In my view, John is the best pure editor I’ve ever come across. And they had working for them an editor named Russell Icke, who was potentially the best of them all. Their work was, by every definition, aspirational.

In February 2000, we had a cup of coffee with Rick in the chilly basement of their Soho offices, a stone’s throw from Carnaby Street. He’d been describing the latest approach from a US editing company interested in buying the Whitehouse and ended the story saying casually, “I don't see a reason to sell my company to them.”

We got on the plane home that afternoon. As we took off I turned to Chris and said, “do you think he’d sell it to us?”

We were back two months later to ask him the question formally over lunch. It was April 27th. My Father’s birthday. And as we explained our vision, Rick fell silent for about twenty minutes. It was the only time, before or since, that I saw him lost for words.

The vision, simply, was that we put the two companies together. Integrate them. Utterly and completely. No marketing alliance. No affiliation. A pure and absolute merger. Their creative profile on our business model. A true network, without regard for geography or time zones. Talent + opportunity. 2+2 = 1000.

The deal took eighteen months to negotiate and paper. Technically, it was probably part merger, part acquisition, but in practice we worked very hard to make sure everyone had an equal voice and shared responsibility. The deal had to be re-negotiated entirely at one point when Andrea decided that she was chemically more interested in starting her own business. Differences are never the problem. Unwillingness to confront differences openly are the problem. Andrea started a company called PeepShow which she has since expanded into the US as well. She did it her way and their work speaks for itself.

The negotiation with the Whitehouse was as challenging as anything I’ve ever done. We learned about LLCs, and S-Corps and Ltd’s. We learned about investment basis, valuation methods, capital accounts, preferred and common stock. We learned the tax implications of phantom ownership, US state tax law (which can extract more than 100 percent of your state tax obligation if you get it wrong), the value of being a US citizen and the cost of equalizing those that aren’t. We learned about VAT returns, UK employment law, inheritance law and what due diligence can mean and should mean. We ran up several hundred thousand dollars in legal and accounting bills to acquire this knowledge, and several thousand more in travel costs in both directions.

There were any number of times it could have fallen apart. When it seemed easier to stop. When the issue of who paid for employees' coffee threatened to derail us. But we managed always to keep to the fore the vision that this would change the way the industry worked. That if we could take the best parts of both companies and truly integrate them, that we would establish so significant a competitive advantage that the rest of the industry might never catch up. (In my view, four years after we left, the Whitehouse still stands alone in its depth of talent and ability to support clients effortlessly around the world.)

By Labor Day that year the various agreements were in the last stages of being finalized and a signing ceremony had been scheduled in Chicago for September 15.

September 15, 2001.

Then the world changed.

Step 4: Integration

On 9/11, Chris and I were in a hotel room in Scotland. She was on the phone with our accountant in Chicago about the upcoming deal with the Whitehouse. Suddenly, he told her to turn on CNN. A plane had crashed into the World Trade Center.

As soon as the picture resolved I knew it was terrorism. A clear blue sky. The tallest building within several thousand miles. And growing up in London in the Seventies where bombs were part of our daily life. I knew it was possible. It took four days to get back to the States. We were the first plane allowed in to US airspace from Europe. We landed to applause and sobbing. And a new way of life.

We focused on two things. Providing stability to our staff. And getting the Whitehouse deal finalized. We felt everyone needed to have hope in the future. We did too. And if travel was going to get harder, a company that was truly integrated across multiple offices and countries would have an even bigger advantage.

We signed the Agreements at our home in Chicago on October 1, 2001. Immediately we changed the name of the company in the L.A. and Chicago offices and waited for the phones to ring.

We soon came to realize that no one knows your story like you do. And if you don’t make it your business to explain it to your customers, your customers won’t make it their business to figure it out. We hadn’t and they didn’t. So we started going to door to door. It’s still the best way.

The next priority was adding a New York office. From Chicago and L.A. we’d learned the need to convince each local community you were serious about being there. You could bring fresh thinking and innovation, but only after you convinced people locally you were in it for the duration.

We hired Roe Bressan, who personified the post production industry in New York and set about translating our culture. Sometimes that meant adapting our way of thinking to her experience. Sometimes that meant challenging her view of the industry with ours. We tried hard to be principled and respectful. Roe was up for the challenge and we grew together.

The dot com bust gave us access to built-out office space. By early April 2002 we had four offices. We came to learn that we now had to think in a whole new way.

Linking offices into a real network is about so many things. Philosophy, technology, methodology to name but a few. And a lot of getting on planes to break down local barriers. Humans are parochial by nature. We can’t help it. So if you want to make a company virtual, you have to commit to that outcome relentlessly. It takes a long time for those roots to take hold. But once they do, they feed themselves.

Managing the company became three-dimensional chess. Every possibility had a cascading effect. In all we were merging six different professional cultures and seventy different personalities. We tried to be transparent and consistent. We knew that if the vision became reality, everyone would benefit.

Rick moved to LA and immediately represented proof of concept for US clients, and we heavily promoted the fluidity of our model. We absorbed travel costs in order to demonstrate the unique way we worked - there’s no benefit to having an advantage if your customers never experience it - and we started to develop technology to provide practical, real-time support of our philosophical approach.

At one point, after about six months, I was inundated by complaints from the managers of each of the offices about how much more demanding their clients were than anyone else’s. Actions speak louder than words. I asked each of them to job swap for two weeks. They came back with empathy and understanding. And supported each other to the hilt.

That became true of employees in every office at every level. Whenever we could remotely justify the expense we paid for people to travel to other offices. This created two things. Practical experience of different situations, which sped their professional (and sometimes personal) development. And incredible fabric throughout the company. Fabric was important to us, as was the growth of individuals. Building a company capable of creating long-term value for yourself means making yourself increasingly less important, not more.

We were transparent about the fact that there were different salary ranges for each city. That a producer in LA made more than a producer in London. You can’t run a business subsidizing local economics. We offered the chance to move through the company to everyone except receptionists. And when the receptionists got promoted, we offered it to them too.

We learned a lot about the difference between business in the US and business in the UK. Differences that I thought I already translated as an Englishman living in America. I didn’t. One of Rick’s favorite sayings was, “it’s not where you’re from, it’s where you’re at.” You have to manage that way as well. Your past doesn’t count. It’s how your staff sees you now that matters.

It took two years for the company to establish a rhythm. There’s a reason 80% of mergers fail. It’s unbelievably personal. And along the way you have to give up part of who you were in order to become what you want to be.

By the end of 2003, we had begun to reap the benefits of being talent rich and geographically agnostic. We were doing better and better work and a lot of it. The company had grown to over a hundred people, most of whom had worked in multiple offices, and the next generation of talent was beginning to come through.

Everywhere we looked we were becoming the company we had envisioned nine years earlier.

Our dreams were coming true.

And that would change everything.

Step 5: Exit

A business with four offices spread across 5000 miles doesn’t lend itself naturally to a single company Christmas Party.

By the summer of 2003, however, it was feeling increasingly important that we have one. The Whitehouse had coordinated over 1000 employee travel nights that year. As a result a lot of people knew a lot of people. But Chris and I had come to realize that we were the only two that knew everyone in the company. It was time for that to change.

If you’re going to throw a party for a group of people aged between 18 and 45, there’s really only one city in the world to choose. Las Vegas.

We split four offices onto eight flights, and after a welcome dinner groups had disappeared to the five corners of Las Vegas for a day and a half armed with one simple request. Be at the House of Blues elevator at 6pm.

In my heart, I knew that getting 90 people to leave behind everything else that Vegas had to offer so they could be waiting for an elevator to be unlocked at 6pm was a fantasy.

If you’ve ever heard the song, “Tie A Yellow Ribbon” you’ll have some sense of how I felt at a few minutes past six that evening. Every single person was standing in line. They wanted to be with each other more than they wanted to be in Vegas. It was in every way the definition of the kind of company Chris and I had hoped to create. It was quite literally a moment when our dream came true.

An hour later we photographed the Whitehouse on the balcony at the top of the Mandalay Bay, with the Las Vegas Strip as a backdrop. It was December 13, 2003. Every picture captures a moment in time. This one speaks for itself.

We rode the energy of Las Vegas into an extraordinary 2004. We made some changes that were necessary but painful. The needs of a company change as it grows, and you have to be ever vigilant for seeing when employees have stopped growing with you. Support them, teach them, nurture them and review them honestly. But at some point, no matter how much you wish it otherwise, the company outgrows some people and you have to support the efforts of everyone else by letting go.

in June we took a large group of people to the Cannes Advertising Festival for the first time and saw for ourselves the breadth and depth of our connection to the industry. At Cannes every award carries a set number of points. The film production company that earns the most points that year is the winner of the Palme D’Or - the best production company in the world. I added up our points total. It was double that of the winner of the Palme d’Or.

There is no Palme d’Or for editing companies. But the results at Cannes that year were a measurement that meant a lot to me. It was third-party recognition of our creative capacity. A definition of ‘best’ that was hard to dispute. And for Chris and I, when we combined the results of Cannes with that incredible night in Las Vegas, it was the beginning of the end of our Whitehouse journey.

The year finished on a high. We had our biggest and most profitable year and Chris and I scheduled a trip to each office’s Christmas party. Since our first year, we had made it a point to go round the room at every office party and thank everyone personally. Over time, David had taken over responsibility in Los Angeles and that year for the first time, John did it in London. They were both clearly comfortable and increasingly in their element. As part of each evening Chris talked about the local charities the company had supported that year. We talked on the way home from London about the impact the company was having on lives beyond its 16 walls. It was a tradition that was now embedded in each office.

I made a short speech at each party to provide the overall company perspective. It felt different. Not quite unnecessary. But no longer essential. The company was connected in so many ways that we no longer had to be the glue that held it together, or the oil that eased the way.

2005 got off to a good start. Billings were up, we did some noteworthy work in the first couple of months, and our management team had hit their stride. We were spending time fine tuning and maintaining. Neither is my strength.

Growing a business is personal. Intensely personal. And if you knew what you were in for, you’d probably never try. But eleven years later, through all the ups and downs, we had done what we set out to do. And then some. By any standard I cared about, the last twelve months had proved to me we were the best editing company in the world. It was time to move on. Chris agreed.

We thought about it for a week, and told our partners by email the following Sunday night. We had pre-built the mechanisms and the valuation methodology for any partner who wanted to leave, and the negotiations took place quickly. Chris and I helped assemble the new management team, walked everyone through a transition plan, and we made the announcement over a 4-way in-house video conference. A lot of people were emotional. But no one was surprised. They knew the company had been built to last.

On our last day, less than two months after we had made the decision, I sent out an email to the Chicago office asking everyone if they’d mind leaving at 5:45pm for about half an hour. We had walked into the office on the first day with only our dog Harry for company, and we wanted to leave the same way.

We walked room to room, remembering the construction, the conversations, the meetings, the laughter and the drama of each. Then one by one we turned off the lights, turned on the alarm and left. We stood on the street outside for about five minutes and hugged each other and cried. Then we drove home.

The next night the company threw us the most extraordinary party. They had made movies about us, prepared speeches, flown people in from every office, and said thank you in the most heartfelt way. We had bought presents for our now former partners and for Livio Sanchez and Sue Dawson, without whom it would never have happened.

Two days later we were on a plane to Europe, conscious that we needed to be somewhere else for a while so that the lack of emails and phone calls wouldn’t depress us. In fact, our process of giving ourselves true closure had worked incredibly well, and the transition to a life without the Whitehouse happened even more easily than we expected.

In the weeks that followed we quickly realized two things. We had moved on. And so had the Whitehouse.

We were glad. That was what we had wanted. That’s the way we had built it.

It was time to start a new chapter.

“To make an end is to make a beginning. The end is where we start from.”