Andreessen Interviewing Ovitz
Via All Things D, a strong interview on CAA as a disruptor in the 75-year-old entertainment talent game with a $100k line of credit, utilizing only $21k.
What’s interesting on both a disruptor and company building level is that Ovitz and his early partners were able “with a standing start” to launch CAA. Ovitz shares how they went for their bank line, and the head of the bank was good friends with William Morris’ CFO, where Ovitz et al were currently agents. Realizing they were about to all get fired, they pulled an all-nighter to lock up their partnership, and then went in the next morning and resigned.
Similar in some nature to how Ari Emanuel and his departing ICM coterie created Endeavor in 1995, Ovitz shares the hardships of the early days. Like an internet startup, CAA was independent looking to leverage deals. Read more >>
Imagenation: Hybrid Marketing & Distribution
These players certainly don’t need “help” in the global economic sense. Imagenation out of Abu Dhabi – with $1B in film capital – continues to create ties in the world of cross-culture film financing. In a recent expansion with early partner Hyde Park Entertainment ($250M in Imagenation funding) into Singapore with $75M towards four films, Imagenation looks keen to transition its financing into Asia, which many say is the next big Hollywood donor after the Middle East and India (Reliance and Dreamworks).
It’s an intelligent play to bridge capital between markets, i.e., share risk globally. Per Imagenation CEO: “It give us a focus east – Singapore, China, India – which is something that we want to do. And as Abu Dhabi and Singapore have a very close relationship, as city states, this strengthens our bonds with Singapore.” It also opens up their early production resources to digital effects, animation and gaming, including EA and Ubisoft. Read more >>
The Empire of Ari Emanuel
Leave it up to the NYT’s to create somewhat of a sensationalistic forum on the agency aftermath of the William Morris + Endeavor merger takeover. Under the headline “Mogul Ascends With Old Hollywood Clout,” the Times serves up little more than innuendo around golf games with outside investors, anonymous Hollywood insiders fearing both Ari and Rahm Emanuels, and finally, musical chairs or board seats with Ari on the Live Nation board. From Silicon Alley Insider - our preferred business read although they ditched their Entertainment blog “The Biz” somewhat quietly – made mention of the Ari Gold Ascendency of Emanuel, but both articles seem to only paint Ari as a hard ball player on the rise with a brother in the Obama Chief of Staff hot seat. One wonders how that fraternal conflict of interest can be of any use to either brother outside of easy sleepovers at the White House. Read more >>
William Morris + Endeavor, Future of the Mega-Agency
The mega-agency merger is made: William Morris Endeavor (WME) Entertainment is the combined talent agency merging film, television, music and book publishing between WMA and Endeavor. Architected on one side by Ari Emanuel, who left ICM (under Wiatt) nearly 15 years ago, and his senior partners – Patrick Whitesell (former CAA), Adam Venit and Rick Rosen (the fourth, or fifth, principal was Tom Strickler, who resigned presumably because he was anti-merger); and, by Jim Wiatt and Dave Wirtschafter from the WMA, now Chairman and Co-CEO, respectively, with Emanuel and Whitesell. A breakdown of the deal math, what it means, and where they go next in relation to CAA.
The Agency/Deal Math:
With Endeavor’s 80-100 agents (about 280 total employees, per LAT) and WMA’s 150 agents (800 employees), Nikki Finke at Deadline Hollywood Daily’s (DHD) blog, which expertly followed the merger, predicts 100 or so layoffs over the next few weeks.
Add to that the requisite agencies’ assimilation issues – agents/agency poaching and conflicts, agents-turned-managers, change of client marketshare – comes the understanding that while this merger helps both companies survive the current economic storm and a changing entertainment environment (lower DVD revs and TV budgets, less upfront/more backend for theatrical).
With combined revenues of $300-325M – research points to a 2:1 split between WMA:Endeavor – the goal will be to challenge the dominant CAA, while maintaining course with current clients.
And with the new classification as WME “Entertainment” (as opposed to “Agency” or better “Media”), one wonders if they will stretch the model as has been seen with the Endeavor-MRC relationship.
The toss-up will be how the two sides intermingle and work together to produce coherent results for their shared clients. Early on, Emanuel said, “We need a bigger boat,” given the merger exploration process which took an emotional toll on both sides, not to mention their clients.
Endeavor Advantages:
|
WMA Advantages:
|
Both sides now realize that any newly merged company has to consist of only 150 core movie/tv agents at most. The mantra of these negotiations is “make it smaller”. That means, of WMA’s 150 agents, and Endeavor’s 100 agents, about 100 from the combined total will have to be let go. And since CAA’s Richard Lovett has pursued a policy of 100% marketshare when it comes to clients, the new WMA-Endeavor is making as its goal to rep only the elite Top 2%.
After the jump, more on the new agency makeup, the financial value of the enterprise, and the new-and-improved mega-talent agency skirmishes and wars to follow…
Anti-Studio: Media Rights Capital(izes)
MRC, Media Rights Capital, is quickly becoming the new model for production companies and talent agencies – a hybrid of financing, rights ownership and innovative packaging. Its rights’ model shares ownership equity with film talent, moving beyond the usual pay-or-play contracts. After the jump, we’ll dive into their recent formation, industry perspective and what their success means to the market. Upcoming MRC titles include:
- Brüno- $42.5 million from Universal, rights revert to MRC; received new R-rating instead of NC-17 yesterday
- The B Team – Will Ferrell+Mark Wahlberg action/comedy, rights to Sony
- The Adjustment Bureau – Matt Damon action/romance/sci-fi, $62M budget, rights to Universal for 20 years, then revert to MRC; 20% first-dollar-gross backend. The studio puts up P&A and gets worldwide distribution rights. Read more >>