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A Tough 2023 for Tech
O'Dwyer's Public Relations News O'Dwyer's Public Relations News
For Immediate Release:
Dateline: New York, NY
Thursday, April 18, 2024


Any way you slice it, the tech sector had a tough year.

While 78 firms appeared on our 2023 list, for 2024 that number has slid to 63. And if you compare last year’s top 63 firms with this year’s group, net fees are down 17.5 percent—going from $858 million to $708.3 million.

The biggest firms did a bit better than the rest of the pack. The drop there was only 7.7 percent—from $556.8 million to $514.1 million.

Highwire Rethinks Its Way to Growth

Carol Carrubba
Carol Carrubba

“It was a challenging year for the tech sector,” said Highwire principal Carol Carrubba. “Rising interest rates, inflation and the proliferation of AI caused many tech organizations to rethink communications strategies and resourcing.”

Nevertheless, Highwire, which came in at #5 on our tech list, still managed to post 5 percent growth in 2023. Carrubba attributes much of that growth to the agency’s move toward “deeply integrating content, social and creative services into our strategic communications programs. We’ve seen repeatedly that integrated programs deliver more business impact and increased value.”

Highwire is looking to spur further growth with the recent acquisition of Candor Content, a content marketing company with expertise across technology and healthcare. Carrubba says that the acquisition will offer clients “expanded capabilities across SEO, lead generation, brand journalism and more.” The agency has also hired Magaret Cote as the head of insights and analytics.

AI, she notes, will continue to be the big story in the sector. “It goes without saying that AI is the biggest driving force in tech right now. It’s revolutionizing every industry. For example, in healthcare AI is poised to reduce the administrative burden that cripples healthcare providers, improve comprehension of healthcare text, and ultimately, improve patient outcomes.”

Carrubba also expects to see “an increase in the need for cybersecurity communications. In late 2023 the SEC enacted the Cyber Disclosure Laws, meaning organizations now have four days to assess and disclose whether they’ve been impacted by a cybersecurity breach. The regulation highlights the importance of cybersecurity to a brand’s reputation and puts pressure on communications leaders.”

She also sees developments in energy and sustainability as central components in the agency’s tech business. “We’ve seen more AI-powered tools employed to automate energy transformation along with the integration of blockchain technology in the energy sector. The rapid growth of renewable energy sources is also front and center.”

But Carrubba also stresses that “every industry will be impacted by this. As every company grapples with customer and data security, we aim to strengthen our guidance on all regulations, leveraging our strong cyber expertise bench to advise on complying with legislation from a communications perspective.”

And finally, she cites the agency’s investment in it team as a big part of its success. “We redoubled our commitments to innovation, DEI and team empowerment,” she notes. “Our culture thrived while we grew, despite the tech industry’s economic downturn.”

PAN Maintains Stability

PAN Communications, the #10 firm on our tech list, “adapted effectively, maintaining stability as the market underwent significant corrections,” according to president and CEO Philip Nardone.

Philip Nardone
Philip Nardone

“Even as the tech sector destabilized, our early adoption and embrace of growing tech like AI made us a magnet for clients pivoting in this direction. Due to legacy brands adopting AI, new AI offerings emerging and an increased focus in ethical AI, we are proud to say more than 50 percent of our clients touch this space,” Nardone said.

He says that PAN experienced growth across the public sector, health tech, commerce (supply chain, logistics, ecommerce) and security. “As these industries adapt to the intersection of AI, security and data, we've been well-positioned.” In addition, he says that the agency “saw a spike in demand for comprehensive content strategies and thought leadership across our client base.”

Later this year, PAN is introducing a new data platform that will further demonstrate how its efforts are making a tangible business impact—an essential tool as the tech economy remains shaky.

Nardone also notes the increasingly pivotal role his agency’s staff plays in its success. “We used 2023 to continue to build a foundation that puts employees first,” he says, citing its Hyflex+ work model, a permanent policy that gives employees the flexibility to work from anywhere, and its ongoing commitment to DEI. “As of this year, 20 percent of our team members identify as persons of color, and 30 percent of our 2023 hires were racially and/or ethnically diverse.”

As the year progresses, Nardone says he expects for PAN “not only to grow through the organic expansion of our current client base and new accounts but also to explore innovative ways to enhance our offerings, be it through mergers and acquisitions or strategic hires.”

LaunchSquad Moves Into a Strong Position

“2023 was a particularly turbulent year for tech and venture-backed companies, which make up the majority of our client roster,” says LaunchSquad director of business development Jacqueline Hull.

Jacqueline Hull
Jacqueline Hull

“The pullback in investments and the weak IPO and M&A markets led to increased pressure for our clients to grow responsibly, and in many cases resulted in budgets tightening across the marketing and communications functions.”

Hull says that the agency responded to those rapidly changing budgets by working closely with clients “to realign our scope and services with their new circumstances. In response, we shifted resources into sales and business development, and we were able to add a fantastic cohort of new clients to our roster, especially in the climate and sustainability sector.”

She notes that the growth in climate and sustainability work stems in part from “the U.S. government’s vast commitment and investment in climate change solutions, we have significantly grown our climate and sustainability roster and it is currently our largest practice area. This work — from carbon removal, to food waste reduction, to energy and transportation — is extremely fulfilling for our people, and has been part of LaunchSquad’s core values since our founding.”

LaunchSquad has also “implemented significant changes across the company, particularly in sales and business development, operations, and people initiatives. We feel we are in a very strong position today to prosper as the tech, innovation, and venture capital economy inevitably reimerges.”

While Hull says that AI will “offer exciting new ways to improve the way we work,” LaunchSquad still plans to “invest in helping our people become highly creative and adaptable so they can generate high impact for clients using their own intellect. Comms is still a people-driven profession and will be for quite some time.”

She adds that she is “confident that this year will be stronger in almost every category compared to 2023. This is partially due to the changes we have been implementing, as well as the broader market improvements that are setting us on a growth path again.”

Alloy Rides a Growth Wave

Alloy, our #22 tech firm, had a banner year, says CEO Raj Choudhury. “Thanks to an acquisition and organic growth, we grew 103 percent in 2023—exceeding our initial expectations.”

Raj Choudhury
Raj Choudhury

The agency also had a 92 percent employee retention rate, “which exceeded industry averages.” Choudhury says that meant the firm was “able to redirect HR resources to create value in other areas.”

Nevertheless, he notes that the firm was not immune from tech’s difficulties. “We faced headwinds as the tech sector battled volatility. Some of our clients suffered layoffs that affected our partnerships in various ways.”

Alloy recently announced a significant investment from Purpose Group, which Choudhury says will be “used to fuel our growth strategy, including our ability to accelerate our M&A strategy,” which includes “broadening and deepening our capabilities by acquiring innovative, right-fit units.”

As far as AI goes, he says Alloy is “already realizing positive benefits from the dawn of this technology. Since implementing new AI-based tools and feature sets in our stack, we’ve made measurable gains—from decreasing content editing rounds to streamlining graphic design workflows to accelerating website development timeframes.”

Choudury expects this year to show signs of overall improvement as well. “In addition to organic revenue growth, we’re identifying areas of efficiency— from new office space to resource management to AI tools— which we expect to positively impact the bottom line in 2024.”

Hotwire Embraces Change

“Our industry is still navigating long-term questions about how marketing and communications leaders will integrate AI into our workflows, tech stack and the partnerships we prioritize,” said Hotwire Global CEO, North America Heather Craft.

Heather Craft
Heather Craft

“Clients turned to our team for consultation around building or refining AI narratives, engaging with AI media and building relationships with AI influencers, as boards and c-suites quickly reacted to the initial groundswell,” she added.

Craft also cites “increased generational diversity in the global workforce, with varying perspectives and preferences around workstyle, work environment, and what’s valued and expected from an employer.”

Hotwire, the #2 firm on our tech list, accelerated its investment upskilling its team in 2023, as well as developing solutions designed to empower organizations by leveraging advanced analytics, AI, and comprehensive data insights to better identify the most impactful messaging, storylines, reporters, and influencers. Its new data intelligence offerings: MessagingIQ, NewsroomIQ, and IQBrief, have been utilized by brands such as Discord, Avanade and ABB to add greater intelligence to their communications and marketing programs.

While 2023 was a pivotal year for many industries, Craft notes that “we’re in an industry that has long embraced change and never sat idle. We look forward to the year ahead, as the role that marketing and comms plays has never been more critical, and our team is well positioned to help elevate our clients' brand reputation, deepen the relationships that matter and ultimately drive revenue.”

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