Two decades after founding the agency now known as Real Chemistry, Jim Weiss has named a successor.
Shankar Narayanan, who brings senior life science experience from roles at consultancies Cognizant and McKinsey & Co. and other big organizations, will become CEO effective January 3. The agency announced the managerial moves to employees Thursday morning at an internal town hall and is expected to issue a statement this afternoon.
Narayanan will assume day-to-day operations, as Weiss moves into the role of founder and chairman. Weiss will also join Real Chemistry’s investment partner, New Mountain Capital, as an executive advisor. Both men will join the agency’s board of directors and Narayanan, who’s based in Boston, will also report to the board.
“He’s a healthcare nerd like we are. He knows the business,” said Weiss of his heir apparent.
Weiss credited New Mountain with helping him select a CEO who would preserve the agency’s culture. “There’s no intent here to change that all that much,” he added. “What is important is our people, clients, the work we do and the patients we serve. That will be the north star.”
Asked about the somewhat unusual decision to tap someone who rose through the consulting ranks, rather than an agency veteran, Weiss said Narayanan’s experience operating and growing large healthcare-adjacent organizations makes him “ideally suited” to take the helm of Real Chemistry at this point in its history. The agency is currently celebrating its 20-year anniversary.
“We will do about $475 million in revenue this year and next year we will obviously cross the $500 million barrier,” Weiss said. “The experience Shankar brings – running life sciences at Cognizant and taking that from $800 million to $1.3 billion in revenue – was critical. Obviously we want to scale, but we want to grow and scale at quality.”
In September Real Chemistry reported that it recorded first-half revenue of $200 million; that it is on track to achieve 35% organic, year-on-year growth; and that it has hired more than 600 people in recent months. The firm reported full-year 2020 revenue and head count of $334 million and 1,519, respectively, according to MM+M’s 2021 Agency 100 issue.
At about 1,800 people and rising, Weiss said, Real Chemistry doesn’t aspire to be “the big bulk player in the space” but rather a nimble, efficient and transformative partner to clients. “To do that, you really need an expert like Shankar.”
Narayanan’s healthcare resume runs deep. In his most recent C-suite role, he served as COO of payer analytics firm Equian, a former portfolio company of New Mountain. Once Equian was sold to Optum in 2020 for $3.2 billion, Narayanan worked under the new ownership for another year-and-a-half.
He then took some time to contemplate his next move. After spending nearly five years in the payer world, Narayanan said the COVID-19 pandemic reinforced his desire to be back in biopharma.
“It’s an industry that I spent a lot of time in, both at McKinsey and at Cognizant, but COVID showed us what that industry is really capable of,” he said. “For years, pharma has had somewhat of a mixed reputation in some circles, but to me this was pharma’s bright shining moment. Everybody now understood what research- and innovation-led science can do for the world at large.”
The pandemic, of course, also prompted the industry to compress years of digital transformation into an 18-month window. “Now, you look around and physicians don’t want to meet reps in-person anymore,” Narayanan continued. “They want to do everything remotely. Gone are the days where you would sit around a conference room table and say, ‘Let’s design Slim Jims and tchotchkes for Dr. John Doe.’”
As conversations have turned to the many ways clinicians are engaging on different platforms, Narayanan sees opportunity in drawing on his technology and data background to oversee the way content is customized, personalized and delivered.
“Real Chemistry has this incredible trifecta of capabilities: communications, marketing and data/analytics,” he said. “To me, those capabilities are converging at this time, and that’s what clients want the most.”
It was the desire to appeal to an increasingly innovation-minded industry that drove the agency to rebrand from W2O to Real Chemistry this year. But after spending time with Weiss and global president Jennifer Gottlieb, Narayanan explained, the agency’s people and values cemented his decision to join.
His challenge entails not only taking on the leadership mantle but also realizing the agency’s strategy of uniting multiple integrated capabilities. Since bringing on New Mountain in 2019 (it initially partnered with investment firm Mountain Gate in 2016), Real Chemistry has acquired nine companies, from creative shop 21Grams to social media analytics firm Symplur and machine learning specialists Swoop and IPM.ai.
Over the past two years, the firm has doubled its revenue and nearly doubled EBITDA, Weiss reported, even as it is still in the integration process. “There’s a need to ensure we have the operational and systemic foundation to make it easy and efficient to work with us and to work here. Our people are clamoring and asking for that, as well as our clients,” he noted.
As for Weiss’ decision to change his role, he’s not fully moving on. Rather, he will continue to mentor, work with clients and capitalize on his vast network and extensive relationships on the recruiting front. As Real Chemistry’s founder, chairman and board member, he said he will be careful to stay involved in “ways that help the most, and get out of the way where I’m not helping at all. That’s an important thing to learn.”
And serving as an advisor for New Mountain, he said, will test his skill in helping the organization “see around corners, see the whole field and figure out where to go. We’ve always been good at figuring out where the next thing is for our clients and our people. And it seems like the perfect time to do this.
“I’m 56,” Weiss added. “I’m not old, but I’m not exactly starting out. So if I was going to redirect my own career, this was the moment.”
