The rise of talent platforms and their threat to agencies

by: Lucinda Southern on 15 January 2015

Tongal has set out to organise rather than employ talent, 12ahead speaks to its co-founder James DeJulio

  • Tongal in numbers, from 2014
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  • 270 Projects (+100% over 2013)
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  • 90k Ideas contributed (+100% over 2013)
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  • 3,330 Videos/Ads Created (+100% over 2013)
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  • Community Growth increased +120% (from 2013)
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  • Raised +$20MM of venture capital from Insight Venture Partners

There’s been a lot of discussion about the widening talent gap in the creative industry, and with traditional agency models in flux, this is paving the way for new measures of generating ad campaigns and branded creative.

Talent platforms are gaining traction with swift pace, indicating the time is right for a change in talent scouting. Topcoder has inked deals with Nasa cementing its relevance within the space-exploration industry, while Tongal is storming the advertising sector.

An on-demand video content platform, Tongal lets sponsors, (increasingly more and more brands including players like McDonald’s, Lego, Mastercard, Kraft and Oral-B), post a project to the platform which gets pushed out to the community who submit ideas to solve the challenge. The winning ideas get chosen by the sponsor, and the creators remunerated, while directors then pitch their vision and are given the time and money to bring their idea to life. The outcome is anything ranging in content and format from a music video, branded entertainment, product innovations, to TV spots, online video and more increasingly short-form videos like Vines.

Tongal has seen impressive rates of scale; it’s currently the 8th fastest growing company in Los Angeles, making it in the Inc 500 list in 2014. Launched in 2008, last year saw increases of over 100% YOY in the number of projects launched, ideas contributed and content created, and the community grew by over 120%. Over its short history it has raised $20M of venture capital from Insight Venture Partners.

With brands going straight to the creative source for one-off projects, agency roles are potentially facing a threat. Speaking to 12ahead, James DeJulio, co-founder of Tongal, says setting out to disrupt this order was never the intention; “The objective has always been to bring the world’s creative work to the world’s creative talent,” he says, explaining the platform began to straighten the meritocracy discrepancies that Hollywood suffers; “as we got closer, we saw more immediately addressable opportunities and inefficiencies with advertising content.”

And that’s the endgame, a win-win for consumers, sponsors and creators; more efficiency, something that can scale (thanks to Tongal’s robust and heavily invested-in management software) lower cost from less overheads, global diversity (again, lack of this is another often-cited criticism of the ad industry), all adds to a model that promotes agile creativity.

“To me, it just made sense - if technology can enable things to happen at the same or better quality, faster and more economically - while unlocking mutual value between the person or people doing the work and the person or people sourcing the work, then it just made sense and was going to happen eventually,” says DeJulio. “It was started to bring opportunity to undiscovered talent and create value for customers.” 

With every piece of creative up for pitch, a criticism of this model is having a less established relationship with your providers, something that agencies can provide value in. DeJulio notes that it’s rare that agencies use the same production teams to carry out the physical execution of the work. Employee churnover in agencies reaching greater rates also makes this less of an sticking point.

A counter argument is found in Tongal’s relationship with LEGO. “We partnered with LEGO in 2011 and have built a significant portion of their YouTube channel which accounts for hundreds of videos and +60MM views,” says DeJulio. “We have become friends, we plan together, we understand their business, we celebrate wins together.”

More of this is in store for Tongal this year, who will be leveraging opportunities with existing customers and generating longer-term partnerships with brands, as well as supporting community members to deliver more ‘real-time marketing’ for consumers.