by Natasha Wolff | December 14, 2015 12:50 pm
On Friday, September 25, 2013, the day after his namesake advertising agency abruptly filed for bankruptcy, David Lipman returned to the company’s 22,000-square-foot headquarters in New York’s Meatpacking District to sort out paperwork with his accountants. As Lipman tells it, he was exiting the office when a white van pulled up in front of the building. A man—whom Lipman says he did not recognize—sprang from the passenger’s seat holding a two-by-four. He proceeded to clock Lipman over the head with the piece of wood.
“I went down, and he started kicking me and calling me names,” recalls Lipman, who bears a large scar across his right cheek from the incident. “Then he jumped back into the van and drove away.”
Lipman never bothered to file a police report: The notion that someone might be out to get him did not exactly come as a shock. His agency owed a lot of people a lot of money, and they weren’t just angry—they were out for blood.
It’s been two years since the Lipman agency shuttered seemingly overnight, leaving stunned employees without jobs, A-list clients like David Yurman and Stuart Weitzman with unfinished campaigns and top talent—including Kate Moss and photographer Mario Testino—with millions in owed money. People said Lipman would never work again and there was a time when Lipman himself might have agreed. Now, though, he’s fighting to make a comeback.
One could argue that Lipman was born to be an ad man. His grandfather, Herb Lipman, founded the Lipman agency in 1927 before passing the company on to David’s father, Robert, in the late 1940s. Lipman spent most of his twenties working for the global advertising agency Bozell & Jacobs, but later decided to join his family’s more modest firm, which was then creating campaigns for resorts in the Catskills.
“That world died in front of us,” says Lipman. But he was less defeated than motivated. He set out to save the family name, though the way he tells it, there was no strategy or plan—“it just happened.”
Soon, the Lipman agency was working with talent like Cindy Crawford and Linda Evangelista—then up-and-coming models—on ads that garnered quick attention. Former Burberry chairman Victor Barnett was so impressed by Lipman after a brief phone call that he hired him 24 hours later; the brand became Lipman’s first international client. Over the next 15 years, he turned his father’s humble agency into one with luxury accounts and international cache—replacing run-down hotels with Harry Winston, Yonkers Raceway with Mercedes.
From the late ’90s to the early 2000s, the Lipman agency was considered a major player in the luxury-advertising landscape, and Lipman the creative force that every brand wanted. He was shooting campaigns with Angelina Jolie for St. John, directing Smartwater ads with Jennifer Aniston and was even hired as a creative director on Justin Timberlake’s debut solo album, Justified. Images from these projects, among others, now cover the walls of his East Village townhouse.
“The first time I saw what he was doing I was blown away,” says Tommy Hilfiger, who met Lipman in the early aughts and eventually hired him for several campaigns. “He chooses the right photographs, the right lighting, the right setting, the right models. David is incredible at doing sexy, sensuous and eccentric advertising.” Another early client, jeweler David Yurman, hired Lipman in 2000 just as the brand was taking off. “We needed somebody with an eclectic, emotional point of view,” says co-founder Sybil Yurman. “[His ads] represented an emotion and a tone and a resonance that gave you the feeling of who we were. It accomplished everything I was hoping for.”
But when the economy took a turn for the worse in 2008, the Lipman agency started to struggle financially. Through a friend, he was introduced to Andrew Spellman, a former Goldman Sachs executive, and enlisted him to handle the books. Spellman became CEO and the Lipman agency began operating under Spellman’s holding company, Revolate, with operations overseen by a seven-person board. “I willingly gave it away with a smile on my face. I said, ‘Let me have creative control. You have business control,’” explains Lipman, who handed over to Spellman and other investors a 68 percent stake in the company, keeping 32 percent for himself.
That first year, he says, “was glorious. We went back to doing business the way we were doing it pre-recession.” The company began to expand at a rapid-fire pace, opening a digital agency, a celebrity-partnership company and a private-equity division—though none, says Lipman, were bringing in revenue. Instead, the new departments were draining the company of cash, with money that didn’t exist going toward pricey hires and rent. Lipman didn’t necessarily object. “I think we all sort of got drunk with the idea that it was easy,” he says. “And nothing is easy.”
NEXT: “Lipman holed up in his apartment while reporters lurked outside his front door. He contemplated taking his own life.”
As time went on, though, Lipman grew worried that the brand he’d worked so hard to build was in real trouble. His employees were receiving calls from agents, angry that their clients weren’t getting paid. “It was a huge mistake,” he says of giving up control. “Catastrophic. And when I realized that I wanted it back, it was too late. Nobody was listening to me.” He couldn’t have afforded to buy it back anyway.
In mid-September 2013, Lipman was at his son’s baseball game when he received an emergency phone call from the board. They were going to file for bankruptcy, imminently. Lipman says he lobbied to hold off: It was the middle of campaign season, and filing for bankruptcy would leave his clients with half-finished ads for their spring collections. There was enough cash flow to operate until December, Lipman argued, but the board, he says, decided to go through with the bankruptcy anyway. (Calls to Spellman’s attorney and several board members went unreturned. The attorney representing former Revolate president Michael Mendenhall said in an e-mail that his client declined to comment.)
Within a week, the office was closed and 60 employees were left scrambling to find new jobs. According to court documents, the agency’s debts totaled $9 million at the time of the filing. Harry Winston was one of several companies that filed suit around that time, alleging that the Lipman agency and Revolate “intentionally and knowingly duped Harry Winston International into making advance payments for media buys” and, in turn, used that money to fund unrelated Revolate interests. The suit was ultimately put on hold when the agency filed for bankruptcy.
Lipman’s friend and former employee Hunter Lee Soik called to check in on him after hearing the news. “I just said, ‘Hey man is everything okay?’ He was pretty quiet about it. He didn’t say too much,” recalls Lee Soik. “That was the moment I knew things were really starting to unravel.”
In the weeks that followed, Lipman holed up in his apartment while reporters lurked outside his front door. He contemplated taking his own life. “I understand now why people commit suicide,” he says.
But Lipman was never the sort of man to stay defeated—he loved the work too much to give it up. He accepted the first consulting job that was offered to him, and it wasn’t long, he says, until former clients started calling again. He began working out of a friend’s office space, consulting for brands like 7 For All Mankind, Caesars Las Vegas and HBC, the parent company of Saks Fifth Avenue, Lord & Taylor and Hudson’s Bay. HBC executive chairman Richard Baker, who had worked with Lipman on a number of rebranding projects before, says he had “absolutely no” hesitation about his decision to hire Lipman again. Says Baker, “I don’t know the details of what happened to his firm, but I do know that talent is rare… and he has talent.”
Another client, luxury real estate developer Extell, was equally unconcerned about the agency’s headline-making collapse. “We still felt that he was a creative genius… and we were very confident in what he could help us create,” says Tamar Rothenberg, Extell’s vice president of marketing. “If the ideas are unique and groundbreaking, then I think they always will be. David will always have his talent.”
Two years have passed since the agency went under, and according to Lipman’s attorney, Jeffrey Rich, the bankruptcy trustee is currently in the process of collecting the estate’s assets. That pool will be distributed to a laundry list of creditors, of which there are nearly 400, according to the Chapter 7 filing, and Rich says that number will likely continue to grow. Lipman admits he’s not sure how things will pan out: who will get paid, how the assets will be distributed and what lawsuits might be filed. What is clear, though, is that there will never be enough money for everyone to get back what they lost.
Still, he has never been more focused on moving forward. “I blame myself,” he says. “It was absolutely heartbreaking. But I’m ready to start a new chapter of my life.”
He recently launched a consultancy company called Creative Brand Craftsmanship and has a team of six employees working out of his East Village home. It’s not the Lipman agency 2.0: Rather than acting as a full-service firm, Lipman serves as a creative consultant to clients like Extell, as well as to European fashion brands Cerruti, Gieves & Hawkes and Kent & Curwen. The biggest difference is that the only cash that funnels through CBC is money to be paid to Lipman and his employees. “I don’t want 20 clients or 60 clients,” he says. “I want a dozen clients that I can work with intimately.” He’s also attempting—at least in a small way—to repay the hairdressers, makeup artists, stylists and photographers who got stiffed by hiring them for jobs whenever he can.
And despite his past, clients—current and former—see no reason he can’t pull it off; that even his determination to return speaks to the sort of risk-taking drive that makes good ad men great. “To see someone who had such a strong career be humbled enough to stand up, dust off and go back out there,” says Lee Soik, “that speaks volumes about who David is.”
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