The Steely Dan effect: when agencies stay lean and use a ‘liquid workforce’

Chris Mele, managing partner and founder of Siberia, an independent design studio/agency based in Brooklyn, runs a foundation of five full-timers who handle design, product management, engineering, and talent management — while he stands in as head of strategy, as well as sales and marketing. 

Mele likens the setup to classic rock “band” Steely Dan, which in reality was primarily comprised of two founding members, Donald Fagan and Walter Becker — who hired any number of professional session musicians to record their albums in the 1970s. Known for being production perfectionists, they sometimes ran through different players before finding their sound. The shop then leans on a roster of 30-40 freelance people of differing skillsets to flesh out what’s needed for each client. 

“When we started this iteration of the company, our intention was, let’s do this and figure out how to flex and only flex,” said Mele. “We have a couple of clients that have longer term contracts where it’s made sense to convert a very select few people who are also very senior … Most of the people that are in our roster are sort of career-committed to being contractors.”

The pandemic certainly helped “shake the box” of agency work, added Mele. “For some reason, in our corner of the world, it wasn’t quite as prevalent,” he noted. “I do think that people just kind of burnt out a little bit  [at the time]. Whatever the percentage was before, there’s a much larger percentage now of folks that really don’t have that much interest in being part of a full time team and being committed to company culture.”

Adam Kleinberg, founder of Traction, an agency he now describes as a marketing accelerator company, believes in what he calls a “liquid workforce.” Kleinberg actually set up Traction’s current means of working before the pandemic — it’s currently at about 20 full time personnel, but about 100 freelancers, or “perma-lancers” as he calls them. 

Traction’s roster of perma-lance keeps expanding because, as Kleinberg explained, they tend to beget one another through recommendation. In fact, moments after he hung up with Digiday for this interview, he got a message in his LinkedIn from one of his perma-lancers suggesting another potential person to add to his team. “It’s not too hard to keep a bench when you get intros like this all the time,” he said.

There are some downsides, Mele explained, including the perception of instability, the prospect of not having the right people available at the right time. He said Siberia lost a potential client because they didn’t believe Siberia could scale sufficiently on a project without more manpower. And both Mele and Kleinberg spoke of the significant effort it takes to onboarding freelance or perma-lance talent, which can backfire if that person turns out to be a dud (it happens even after considerable vetting). 

But neither founder would ever go back to a full-on staff operation again. “When we define who we are, we proudly state this liquid workforce model,” said Kleinberg. “And clients say, oh, that’s smart.”

Kind of like Steve Gadd’s famous drum solo at the end of Steely Dan’s legendary song, Aja.