Shepherd-Smith joins Big Al's, which specialises in offering project-based work using a stable of creative freelancers, six months after he quit TBWA following a management shake-up that resulted in the group president, Tim Lindsay, being fired.
He joins Big Al's founding partners Tom Burnay and Stef Jones, who launched the agency in 2004, and will take an equal share in the business.
The move reunites Shepherd-Smith with Burnay and Jones, the former creative directors at WCRS, who he worked alongside during a stint at Bates Dorland.
Big Al's, which has created recent campaigns for clients including Paddy Power, Air Miles and Lastminute.com, positions itself around providing clients with direct access to creatives working on their business. Shepherd-Smith said that a major attraction of joining Big Al's was "to be involved in so much work again".
Jones said: "We've been stalking Matt for ages. His experience running a creative agency will prove invaluable to us as we continue to grow."
Shepherd-Smith started his advertising career at Still Price Lintas in 1990 before spells at Leo Burnett and Bates Dorland. He joined TBWA\London in 1998 to run its Nissan account, and was appointed the agency's chief executive in 2006.