First published in the Financial Times on 28th October 2014.
Like other professional service firms, such as lawyers, they need to keep clients happy
Every entrepreneur must be a talent manager – able to identify and inspire the right human capital. Without motivated people, no business can succeed. I’ve always been fascinated by those people who focus on doing just this for a living – professional talent managers are the wheeler-dealers who look after the careers of entertainers and artists. They are merely the more glamorous version of professional service firms such as lawyers or management consultants; all are partnerships of a kind, concerned with recruiting and retaining big fee earners who know how to keep their clients happy.
The three great skills such operators need are spotting gifted entertainers early; keeping their famous clients satisfied; and negotiating ferociously on their behalf. Usually talent agents start with nothing except their wits and chutzpah. At heart it is a business that needs no working capital, just drive and insight into what makes creative people tick – and which ones to back.
Top of the tree these days is probably Ari Emanuel, joint boss of William Morris Endeavor. The firm is involved with clients in film, television, music, theatre and the literary world. Silver Lake, a technology private equity investor, bought a 31 per cent stake in 2012, and then backed the firm earlier this year to buy IMG, a sports, fashion and media agency, for $2.3bn. Mr Emanuel is reputedly the inspiration for the abrasive Ari Gold, the fictional star of the HBO drama series Entourage. His writer client Aaron Sorkin, creator of The West Wing, says of Mr Emanuel: “In a business deal, he’s going to try to kill for you.” The firm’s website is wonderfully low key, revealing almost nothing – suggesting it will call you, not vice versa.
Organisations such as WME, and its rivals including Creative Artists Agency, Management 360, Brillstein Entertainment Partners and Principato Young Entertainment, are all engaged in packaging content as well as representing actors, writers, directors, singers and so on. By originating shows – as Anonymous did with True Detective, perhaps the best US crime drama of recent times – they capture more of the value chain than simply acting as intermediaries, taking up to 20 per cent of their client’s earnings.
In Britain the sharpest outfit is Avalon, run and owned by Jon Thoday and Richard Allen-Turner. It specialises in presenting comedy, but does everything from TV production to live performance and even public relations. It commands respect from broadcasters, even though it is known to drive hard bargains. By broadening its activities, Avalon has reduced its dependence on any single show or star, while also offering its clients a much richer range of services.
Traditionally such agencies were much less powerful, at the whim of big corporations such as film studios, record labels and TV corporations. But the rise of digital downloads, the decline of DVDs, the proliferation of TV channels and the desperate need for popular content mean Hollywood needs big names more than ever to make a show a success.
The richest agent is surely David Geffen, who has made fortunes in rock and roll, film and art. But the most powerful agent was unquestionably Lew Wasserman, who started as a booker at MCA and in due course became manager of the business. It was the dominant show business agency, and in 1962 totally reorganised the industry’s structure by buying Universal Studios and Decca Records.
Subsequently MCA had to dissolve its talent agency business. Wasserman finally sold MCA to the Japanese conglomerate Matsushita in 1990, having run the business for 44 years. The Last Mogul, Dennis McDougal’s biography of Wasserman, is a brilliant depiction of the most influential man in entertainment, controlling more levers in his day than Rupert Murdoch, Jeffrey Katzenberg or any of the current day TV and movie titans.
Talent agents rely on their stars, and such income can be fragile. Colonel Tom Parker helped invent pop music by making Elvis Presley the most famous entertainer of his time. Then his “asset” died aged 42.
Yet on the day of Presley’s death, asked what he was going to do now, Parker replied: “Why, I’ll just go right on managing him!” And so he did, persuading Presley’s father to sell him the rights to the star’s estate – at Elvis’s funeral.