| Wall Street money has invested in Hollywood celebrities. It has come for Hollywood talent agencies. Now it is sniffing around Hollywood management companies. Brillstein Entertainment Partners, which represents Adam Sandler and produced "The Sopranos," has been working with the investment bank Moelis & Co to explore selling all or part of the company, according to people familiar with the matter. Entertainment 360, which represents Margot Robbie and produced "Game of Thrones," has been working with the investment bank Raine to do the same, according to a different set of people. A company brings in financial advisors when it is receiving a lot of inbound interest from potential investors needs help deciding what to do. A company may also turn to a bank when it wants to generate interest in a potential sale or fundraising. In the case of Brillstein and 360, it is more the former, said the people, who declined to be identified because the talks are ongoing and no outcome is assured. Financial firms and strategic investors are very interested in entertainment and media, and the representation space is one way to get exposure to that business. Private equity firms have invested billions of dollars in the three biggest talent agencies over the last decade, and just last year funded Candle Media's acquisitions of Reese Witherspoon's Hello Sunshine and Cocomelon studio Moonbug Entertainment. Brillstein and 360 are two of the last management companies of any size that remain wholly independent and open to outside investment. 3 Arts Entertainment (Mindy Kaling, Tina Fey) sold a majority stake to Lions Gate in 2018. Untitled Entertainment (Olivia Wilde, Naomi Watts) sold a stake to Boatrocker Media in 2019. Anonymous Content (Luke Evans, Julia Garner) sold a stake to Laurene Powell Jobs in 2016 and is now looking to swallow Grandview Entertainment, yet another management company. While each deal has its own story, these recent transactions all underscore a fundamental change in the role of the talent representative. Being a talent manager or an agent used to be a relatively simple job. You helped your client line up their next gig and serviced their wants and needs day-to-day. That role has expanded over time as agencies took on more types of clients, including chefs, authors, athletes and corporations. Creative Artists Agency under Michael Ovitz advised companies on major mergers and orchestrated national advertising campaigns. But the role of the representative really changed in last decade as celebrities began to see themselves as entrepreneurs. The internet made it easier than ever for a celebrity to use their fame to sell you products. The Kardashians have larger followings on social media than any company and can communicate directly with their fans via every post (or email). Selena Gomez is a singer and an actress, but she also has a beauty company and a mental health startup. MrBeast is a major YouTube star, but he also has a food business. Celebrity-led companies are attractive to investors because a famous founder helps a business stand out in a world where every product is available with a swipe on your phone. Agencies collect a cut of clients' earnings from film, TV, concerts and on-field contracts. They want to make sure they get a cut of these other businesses and sponsorship opportunities too. But Gomez and Witherspoon aren't just going to give an agency a piece of their business for old times' sake. They must earn that money. That's one reason the three biggest agencies have raised outside money. They've used that capital to expand into new business units, like sports, and created divisions to incubate start-ups like Emma Chamberlain's coffee company. Endeavor has been the most aggressive by a mile. Ari Emanuel has completed dozens of deals over the last decade, including the sports agency IMG, Professional Bull Riders, Ultimate Fighting Championship and every other company with a three-letter initialism you can find. Endeavor is now a media company that owns a talent agency. Creative Artists Agency and United Talent Agency are still agencies, but they are on the path to follow Endeavor into the public markets. CAA completed its biggest deal yet earlier this year by acquiring ICM Partners, which it said made it worth about $5 billion. The company's leadership has been appearing at investor conferences for a few years and an IPO in the next 18 to 24 months would surprise no one. UTA may be a bit farther away, but it has also been acquisitive. Managers say consolidation on the agency side has made their roles even more important. Clients rely on them more because agents are focused on other tasks. Their businesses are stable, profitable and focused on the clients. Agents say this is a load of crap; they are as focused on their lists as ever. But it's clear consolidation of the agencies has made managers examine their own businesses. Thus far, managers' main advantage on agents has been the ability to produce. Agencies tried to set up production divisions and got blocked by Hollywood labor unions. Few management companies are producing at a scale large enough to get a billion-dollar payday. Nor do many have the same resources to invest alongside their clients. (Range Media Partners, backed by billionaire Steve Cohen, may be one exception.) So at the same time firms come looking to invest in Hollywood, managers are more open than ever to raise some money that can better position them for the future. It's not clear if Brillstein or 360 will end up doing a deal. But the next time a client wants to start a company, they want to have the resources to help make that happen. – Lucas Shaw My email is lshaw31@bloomberg.net. Reach out with tips via email, text or Signal. And if you aren't yet signed up to receive this newsletter, please do so here. Netflix picked up the rights to "Girls5Eva" and will now be the home for seasons one and two, as well as the upcoming third season. Let me be the first to say: WHAT?!?! Peacock has struggled to capture anyone's attention since its debut in April 2020. Almost none of its original series have attracted a large audience. Its coverage of the Summer Olympics was widely derided. And its subscriber growth trails every other mass-market service. Now NBCUniversal is taking a comedy produced by Tina Fey that is one of the only culturally relevant shows on Peacock and selling it to Netflix. I get it. NBCUniversal is looking to cut costs. But it has been somewhat unclear just how much Comcast wants Peacock to succeed. This move will hurt the effort to convince employees, partners and filmmakers that Peacock is legitimate buyer. This feels reminiscent of when Netflix took the rights to "Cobra Kai" from YouTube and made that show a smash. It wasn't long before YouTube stopped making original series. Warner Bros Discovery cuts and cuts and cutsCNN will fire staff before the end of the year and chief Chris Licht said the news giant is going to stop buying original documentaries and series. CNN has been one of the most active buyers of documentaries in recent years, earning awards with projects such as "RBG" and "Navalny." It has also commissioned lifestyle programming like "Anthony Bourdain: Parts Unknown" and "Stanley Tucci: Searching for Italy." Licht sys CNN will still try to develop projects in house. Apple raises prices. Is Spotify next?The music industry has wanted streaming services to raise prices for years. I consider the $9.99 monthly fee for Spotify the greatest deal in media. But Spotify has a hard time raising prices when it competes with three tech giants (Apple, Amazon and Alphabet) that don't need to make much money from music streaming. Problem solved. Apple raised the price of its music streaming service from $10 a month to $11 a month. Shares in Spotify rose on the news because it seems inevitable that the company will follow suit. co-founder/CEO Daniel Ek was non-committal, though he said Spotify has "significant pricing power" and has already been raising prices abroad. P.S. Apple raised the cost of its video streaming service to $6.99, which means Apple TV+ now costs the same as ad-supported Netflix. Deals, deals, dealsA new documentary based on the book "Meet Me in the Bathroom" tells the story of the Brooklyn rock scene around the turn of the century. Though I arrived in New York at the tail end of this scene, it still made me nostalgic for college. While I can't revisit the days where I would stay up drinking until four in the morning, I found this playlist to satisfy the itch. Also, my friend Alyssa Bereznak has a new podcast about social media stardom. You should check it out. | 
No comments:
Post a Comment