Who Is Michael Ovitz?

by Michael Ovitz

Rupert Murdoch was sniffing around any available asset as usual, and Michael Eisner wanted MCA’s library for Disney. But Matsushita wasn’t out to bleed the last buck from a sale. They wanted a clean exit and agreed to grant Seagram an exclusive bidding window. By March 1995, when Edgar scheduled a trip to Osaka, it was Seagram’s deal to lose. I briefed Edgar on the basics: Don’t cross your legs and don’t show the soles of your feet; it’s disrespectful. Here is how you hand them a business card. Never take your jacket off in a meeting without asking everyone else if they want to take off their jackets, too. Never ask about the other person’s health—that’s strictly private. I described each senior executive’s personality, hobbies, and children. Edgar went to Japan ready and able. Unlike Lew and Sid, he was at home in any setting. I’d watched him handle himself in Sun Valley and New York and knew he’d be fine at Matsushita. In the first MCA sale, I did all I could to keep the two sides apart; in the second one, I pushed them together. The sooner Edgar and Yoichi Morishita established a relationship, the sooner the deal would close. When they met, Edgar steered clear of numbers and all went well. Three weeks later he went back with an offer letter in his briefcase.

Yet Ron couldn’t admit that his job was eating him up, too. One Saturday he took a call from his most challenging client, Sylvester Stallone. No matter how methodically Ron explained why he should do a certain movie, Sly would lose interest and hit some erase-the-last-hour button and make him start over. Ron was extraordinary in these situations. He showed not one iota of impatience, not with Sly on the line or to me afterward. But this particular call was over the top even for Stallone, ten numbingly repetitive hours. I am not exaggerating. I think Sly broke Ron for good that day.

I was about to become a very wealthy man. When I was younger, cash was my ticket out. I’d made lots of it since. But I yearned to accumulate money—to build equity—which felt different from merely making it. Once an agent stopped working, there was no accrued equity to fall back on. I watched the runaway growth at Microsoft, where Bill Gates had built one of the world’s largest companies. Fortunes were beginning to be made off the internet. Executives I considered as my peers—Michael Eisner, Barry Diller—were raking in hundreds of millions in stock options. My appetite for corporate buccaneering grew as I worked with Herb Allen and mingled with Fortune 50 CEOs in Sun Valley. It grew further whenever I lost an auction to an art collector with deeper resources. I wanted to play in that league, too.

I felt completely numb; frozen with disbelief. The job on the table, chief operating officer, was what I’d negotiated for Ron in my last go-round with Edgar, with one big difference: I was out of the picture. (Edgar would bring in Frank Biondi as the CEO Ron reported to.) After a long silence, when I felt that I could speak without my voice breaking, I told Ron how much I needed him, what it meant to have him at my side. I’m great at pitching even when I’m not sincere, and I was a thousand percent sincere, so it was my greatest pitch ever. I was sure he’d be won over. What came back, in a burst of rage, were all of Ron’s pent-up grievances. How I had undernegotiated for him with Edgar and overnegotiated for Bill Haber because I’d valued them equally in my ask. How I had made a big mistake by walking away from MCA, and how it had always been all about me, never about him. How it was time to strike out on his own, to be recognized as something more than my consigliere. I tried to sell him for two hours, as the knot in my stomach swelled into my throat. Finally, my voice faltered and I gave way. His mind was made up. I felt absolutely crushed. Ron was leaving, and taking the best, most human part of me with him. It felt like I was getting divorced.

I should have made Ron the CEO and called myself the chairman. Because he’d never brought the matter up, it never occurred to me what that kind of recognition might have meant to him. When I looked at my partner, I still saw the brash young man with the cojones to flirt with Geneviève Bujold. I saw the guy who hung out with the biggest stars in the world like he’d grown up with them. I had forgotten that Ron was a high school dropout who craved approval just as much as I did—maybe even more. The biggest problem was that our friendship never quite recovered after I put him in handcuffs for his poker debts. I had instinctively moved to protect our company, rather than to protect Ron from himself. I don’t think I was wrong to do that. I do think I was wrong to behave, afterward, as if the crisis had never happened. It made it less scary for me. I should have taken Ron aside to talk to him about how he was doing, reestablished that unshakable bond, made it clear that I was with him through thick and thin. But men like me weren’t too good about opening up, about acknowledging our fears. And so his resentment festered.

As the dispute over Jeffrey Katzenberg’s unpaid compensation headed for the courts, Michael let me try to settle it. I’d be dealing with both Jeffrey and his friend and adviser David Geffen, which would be tricky. David and I had fallen out back in 1980, when he was producing Personal Best and our dispute over writer-director Bob Towne’s compensation delayed the start date. I respected David’s considerable achievements, but hard as I tried to stay on his good side, he seemed to feel slighted that I didn’t confide in him or, perhaps, defer to him. I would have been wiser to befriend him and take his counsel—given his intellect and influence, that was an error in judgment. But I preferred keeping my own counsel.

possessed. Jane Eisner called me in a fury: “Your crazy work ethic is pressuring my husband. He’s putting in too many hours. It’s against doctor’s orders!” I believed if I could get one thing to work, one new artist or acquisition, maybe everything would turn around. If insanity is doing the same thing over and over and expecting a different result, I had become stark raving mad.

taste. (He used to complain to me about just that quality in Frank Wells.) In trying to keep the Brad Grey deal confidential, I failed to build consensus before bringing it to the boss. I was at sea in Disney’s hierarchy and fiefdoms. It was hard to downshift from CAA, where I did as I pleased at my own headlong pace.

But for the most part I ran in place. My directives were ignored; my suggestions vanished down the memory hole. More than one person at Disney later told me that Eisner went around me to everybody who mattered. He directed Larry Murphy, who led the planning group, to report on our meetings but to sit on anything I proposed. He did the same with Dean Valentine, head of TV animation, who fawned to my face while feeding the press anonymous negative quotes about me. Just humor him, Michael said, and they did.

For

Hightower stayed. In 2005, after Eisner resigned under pressure and Iger replaced him, I finally grasped the method behind Eisner’s madness: he saw Iger as a future successor. Bob has led Disney to new heights as CEO. He built the business with high-wire acquisitions and a stronger foreign profile, more or less what I’d tried a decade earlier. He made big M&A bets on Pixar, Marvel, Lucasfilm, and Fox, and built the Shanghai Disney Resort. Bob was smart about it. First he changed the culture, dismantling the strategic planning group and erasing Eisner’s imprint. And then he empowered the people around him, as any successful leader must. I still think I could have run a big public company, given time to learn and adjust. But I never could have run that company as Eisner’s number two. Disney’s culture under Michael was too ingrained and ingrown. I lacked the power to change it or the temperament to blend in. Bert Fields later told me that Eisner didn’t want me at Disney so much as he wanted me out of CAA, in order to weaken the agency’s power—all agencies’ power. I’d been a thorn in Disney’s side for too long, so he pulled it out. Humiliating me every day was just a bonus.

A few weeks later I finally gave him the property, handling the transaction through our mutual business manager, and Ron lives there to this day.

with increasing speed, we did a face-plant. One big problem was that the smartphone-adoption rate and bandwidth needed for large numbers of people to receive programming on their phones weren’t in place yet. We taped Robin Williams reading the front page of the New York Times and riffing off it—a bit we thought would be a repeatable, snackable way of advertising our wares. But when we tried to upload it to Verizon’s network, it simply didn’t transmit. We intended to be two years ahead of everyone else, but we turned out to be five years ahead not only of everyone else, but of the technology.

Worse by far was that after Robin left, I heard that Barry Levinson was thinking of leaving, too. Barry was my oldest client and one of my closest friends; we’d talked every day for twenty-seven years. Each Christmas he sent me a pint of Chivas Regal with a handwritten note about our year together, and I was always deeply touched. I went to Barry and begged him to stay. I said I was devastated—devastated—that he’d even think of doing that to me. He said it was done; he’d made a business decision. Friends, trying to cheer me up afterward, told me exactly that: “It’s just business.” I said, “No, it’s not.” What Barry and Robin and Marsha did to me, when I was at my lowest moment? I carry that within me still.

Meanwhile, I turned my attention to Silicon Valley. Intrigued, early on, by software and the internet, I’d dreamed of remaking MGM or MCA as a digital-age studio. In the early nineties I flew to Redmond, Washington, and had a four-hour dinner with Bill Gates and Steve Ballmer of Microsoft to talk about what was coming. I met with Andy Grove, the CEO of Intel, to see how our companies might mesh, and before I left CAA, Intel built a media lab there to give us a jump on the internet age. I picked the brains of dozens of tech innovators at Allen & Company retreats and other industry conclaves. I especially admired Ron Conway, the Bay Area’s leading “angel” investor in embryonic start-ups. In 1999, Ron phoned to say, “I know a young man up here who’s extraordinary. He’s starting a company that’s ahead of its time, and he’d like to meet you.”

As Marc and Ben led me into their world, I felt like a privileged student in a graduate school of one. After they sold Opsware, I asked Marc about joining their angel investment group. “Funny you should mention that,” he said. “Ben and I are thinking about doing something more formal.” As their venture capital firm began to take shape, I coached them about how to make Andreessen Horowitz stand out. The idea that took was to offer a full menu of business services—a novel approach in venture, whose stars tend to be one-man bands who freelance out of a larger firm. In other words, Marc and Ben set out to be the CAA of Silicon Valley. They borrowed our roots to give themselves gravitas the same way I had borrowed from Lew Wasserman and Sun Tzu. In essence, the firm linked all the partners’ networks and added specialists to strengthen the whole organism. No individual “owns” an account at Andreessen Horowitz; investments are chosen by joint approval of the general partners, with the entire staff having a say. Then the team provides in-house experts to assist its start-ups with recruitment, budgeting, operations, sales, publicity, IPO rollouts—whatever an entrepreneur might need.

Meanwhile, the talent agencies themselves have become small parts of giant conglomerates. A few years ago, a young exec at TPG, the private equity firm that has bought 52 percent of CAA, casually told me, “I own CAA.” That hit me hard. CAA is still a force in entertainment, but the real heirs to Ron and me are Ari Emanuel and Patrick Whitesell, who’ve turned William Morris Endeavor into a multihyphenate business, a new octopus. Ari is now an agent, a producer, an advertiser, and an investment banker.

I decided to study Silicon Valley the same way I’d studied the entertainment industry when I was twenty-three. I began networking, taking eight to ten meetings a day with founders and engineers. At first I wore a suit, then I left the tie at home, and pretty soon I was business casual, which proved both more comfortable and a psychic relief. Many of the founders I met were dimly aware that I’d consulted with Steve Jobs, both about the entertainment business and later, after he bought Pixar, to help resolve tensions between him and Michael Eisner at Disney. That gave me some credibility, as did my work launching CAA, Hollywood’s ultimate start-up. So with the right introduction it was relatively easy to get a meeting with almost anybody. I met with Peter Thiel and Max Levchin, who’d founded PayPal and become leading investors in tech. I met with Kevin Systrom, who’d founded Instagram. I met with Reid Hoffman, the LinkedIn founder. I took separate meetings at Facebook with Mark Zuckerberg and Sheryl Sandberg. I met with Eddy Cue at Apple. And so on—377 meetings that first year alone.

Smith. The players in the Valley first made their marks in their twenties, as Ron and I did when we started CAA, so I felt right at home with the ambient energy and ambition. Young people make their own rules. I learned my most important lesson when two MIT engineers came to me with unproven technology to improve mobile payments. Acting as their agent, I called John Donahoe, the CEO of eBay, whom I’d met with earlier, and asked him to take a look for PayPal, which eBay had acquired. John brought two of his senior engineers to the meeting, and they began picking the code and the technology apart, asking nasty and insinuating questions. Accustomed to protecting my directors when studio execs got rough, I finally stood and told my guys, “They can’t talk to you like this! We’re going.” The engineers stared at me and said, “What are you talking about? It’s totally fine.” I sat back down; eBay ended up buying the tech. And as we walked out, John Donahoe put his arm around me and said, “You’ve just learned something very important about the Valley. There are no manners here, just brain challenges. It’s about getting to the truth of the idea any way you can.”

Hollywood. Through Alex, I met his brilliant cofounder, Joe Lonsdale, who was just leaving Palantir to launch a venture fund, Formation 8. As the fund went on to invest in hugely successful companies such as Oculus and Illumio, I advised Joe and got even more great advice in return. He was my road map to the Valley; he always knew where tech was going and which young entrepreneurs were going to take it there.

Brian Singerman,

candor. Yet even as we worked to get our feelings out, I felt destroyed because Ron kept confirming my worst fears: every time anyone in town had struck a match of accusation against me, Ron had dumped on a truckload of gas. “No one was better equipped to put you away than me,” he said. I told him, “Ron, you were unhappy at CAA, so you kind of shoved it to me. I apologize for missing the signs that you were unhappy, but you could have just told me.” He smiled a little and said, “Yeah—but you didn’t want to hear it.”

Ron followed up, he checked in, he was courteous and thoughtful, he made me feel like I was the only thing on his mind. It was seductive, particularly as more and more time passed without strife.

The conversation was affable and reflective. I recalled how he and I planned our moves together thirty times a day, and Ron won more laughs when he said, “It was a much more gentlemanly business before we started. Once Mike and I were let loose, no one was safe.” He added, confirming my core belief, “There was no one else who understood what we were doing or how we were doing it except each other.”

But, he noted poignantly, “It was much more personal to me” because my focus on bigger game made him feel less worthy, made him feel “disenfranchised from our relationship.” I jumped in to say that I’d been blind to his feelings, and that in trying to build a wider network “I didn’t realize I was sacrificing relationships that were more important to me.” Ron said, “I also have some responsibility. I did not tell Mike that I was unhappy. I felt that if I had confronted Mike, he wouldn’t have handled it well, and I would have put the place on tilt.” What we were both finally realizing, onstage, was that we’d each unwittingly sacrificed our relationship in order to save CAA—whereas if we’d just focused on making sure we were both happy, CAA would have done even better. The irony was right out of O. Henry.

That same reconciling impulse made me reach out to David Geffen. We met at Marea in New York, shook hands, and had a civil lunch. He told me, “My biggest problem with you was that I tried to be your friend, but you wouldn’t be friends with me!” The old me would have argued, would have objected that that wasn’t the whole story. But I just said, “You’re right.” I was there to make peace, and David said he wanted the same. We were two guys in our seventies, looking to fix what we’d broken. Ronnie later told me that David didn’t have anything bad to say about me afterward. That made me smile a little: the win, nowadays, is breaking even. But I’ll take it.