Michael Kempner, founder of MikeWorldWide on the PRmoment podcast

In this week’s show Ben Smith and Michael Kempner discuss the current US political climate.

Michael Kempner talks us through the organic growth of MikeWorldwide from a garage in 1986 to a “$70 million valuation”, crediting early success to "intentional serendipity," a strong network, and a focus on problem-solving outside of traditional PR conventions.

The discussion also covered Michael Kempner's optimism about the future of PR and Michael’s advice on risk, failure, and the importance of hiring and retaining the right people.

What was covered on this podcast?

• The Trump media era and US political division Ben Smith initiated the conversation by asking Michael Kempner about Donald Trump and the political climate in America. Michael Kempner described Trump as a master at changing the subject and dominating the news cycle, a strategy also observed with Boris Johnson in the UK. Kempner noted that the US is heavily divided into "red or blue" silos, influencing even consumer choices and media consumption.

• Trump's popularity and the road to US national unity Michael Kempner observed that Trump's support often resembles a "cult or a religious action," making the support segment resilient regardless of the political environment. Kempner argued that there is no obvious heir apparent with Trump's level of charisma.

• Kempner and Smith acknowledged that media observers understand the strategy of flooding the media with endless commentary, and Kempner expressed surprise that certain issues, like the Epstein files, are still breaking through despite most media channels being owned by right-wing interests.

• Influence of contemporary media and the future outlook Michael Kempner noted that contemporary means of communication, often referred to as new media, are driving the debate more than traditional mainstream media. Kempner remained an optimist, citing that the US has overcome previous national crises, such as those in the 1960s, despite today's challenges like increased gun violence and different media consumption patterns.

• The growth of MikeWorldwide Ben Smith introduced MikeWorldwide, noting that Michael Kempner founded the independent PR agency from their garage in 1986 with no external funding, eventually reaching a $70 million valuation. Michael Kempner attributed their early success to "intentional serendipity," starting out in his mid-20s without significant financial responsibilities and financing the business initially with insurance proceeds from a car accident.

This unique financial situation allowed Kempner to reinvest every dollar back into the business, prioritizing the hiring of knowledgeable staff.

• Early business philosophy and expansion Michael Kempner explained that his lack of traditional PR experience was a "massive advantage" because he was not bound by industry conventions and norms, instead focusing on solving client problems. The firm grew quickly, largely because Kempner had built up a strong network and goodwill from working in politics. 

• Milestones in organizational and financial growth Michael Kempner estimated that the firm reached 100 people in about ten years. They initially prioritised cashflow over formal accounting, following advice to "run your business for cash". A key turning point was at $5 million in revenue, when Kempner realised the need to hire their first CFO.

• Organic growth and key client acquisitions Michael Kempner confirmed that MikeWorldwide's growth was mostly organic and "really fast," often competing for the title of fastest-growing firm. Significant key moments in the firm's history included winning a project from Continental Airlines (later United), which led to more opportunities, and taking on a major bankruptcy case. 

• Advice on risk, failure, and people management Michael Kempner's advice for those starting out emphasized the need to get comfortable with risk and failure, stating that success in business requires stepping outside one's comfort zone.
  
  Kempner also stressed that the PR business is "simple but hard," with the key elements being finding the right people, helping them grow, and retaining them. He highlighted the importance of empathy in the corporate ethos, as well as staying curious and being a perpetual learner, citing AI as a current example.
  
  

• Optimism for the future of public relations Michael Kempner expressed optimism about the future of public relations, despite the historical fear of change brought by new technologies. He believes core services, such as strategic communications, reputation management, and stakeholder communication, will not be replaced. Kempner views technological advancements as an opportunity to reduce "non-value added parts" of the business, allowing smart firms to use tools to focus on creating value for clients.

• Prisma and the role of AI in precision and predictability Michael Kempner introduced Prisma, an in-house AI tool focused on data analysis with precision and predictability. The tool allows Mike Worldwide to analyze data more precisely and offers a higher predictability of outcomes for clients, who are increasingly risk-averse. While acknowledging that "some serendipity" and luck remain, Kempner emphasized that the objective is to get as close to certainty as possible, and the tool has been remarkably accurate in the past year.

• Differences and commonalities in the US and European PR markets Michael Kempner noted that fees and salaries are materially lower in the UK and throughout EMEA compared to the US, requiring an understanding of the market. Kempner stated that the UK has caught up well with the US in deploying technology, meaning there is no "tremendous difference" in the type of work being done. He emphasised the success of hiring great talent, such as Sarah Maloney, the general manager of the UK office, and noted that MikeWorldwide operates on one P&L, allowing for seamless integration of US and UK talent on client work.

• Outsourcing and the model of specialisation Michael Kempner explained that MikeWorldwide utilizes outsourcing to focus on what they are best at, rather than trying to perform every function for a client. He gave examples of designing but not building websites, and working with third parties for sophisticated surveys. The firm also maintains a pool of trusted global freelancers to handle overflow work, ensuring integration with client operations.

• Advice for entrepreneurs In PR Michael Kempner says entrepreneurs in PR must be prepared to work hard, emphasizing that scaling a business is challenging and requires a big commitment. He stressed the need for entrepreneurs to be comfortable with risk and the necessity of reinvesting in the business, which temporarily reduces profit. Kempner concluded that going for it requires the right personality, preparation, and understanding of the commitment required to leave a stable salary and role in a large company.