The Exchanges

Q You failed there. How'd you get from wanting to go to medical school to this world?

A It was really easy. When I was just about to turn 17, and Universal Studios made a decision to do a tour on their lot, which now everyone knows is so huge, and it's a tourist attraction in LA, but it was very low-tech, very minimal number of people taken through the studio. They were looking for 10 tour guides, five men and five female, and I applied, And I don't know how, Ted, but I got the job. I showed up every morning at seven in the morning, and I left there when it got dark at eight o'clock at night. I went to every department. I did 13 hours of walking. They had a makeup department. They had a prop department. They had a wardrobe department. It was the old days of filmmaking. It was the last great part of the film business. I went everywhere. I got an education in eight weeks. That you couldn't buy. And it was the best eight weeks of my life, and I remember I was at UCLA, and I left Universal with the guy I worked for to go start the same thing at Fox. I set up classes that were either early in the morning or late in the day, and I'd go to the first class, and then I'd go right to the studio, and I kept a suit in my car. And I would change in the parking lot at UCLA, lot five, and then I'd go right to work, and we built up this business there, where I ended up having a hundred people working for me. And they thought I was 25, and I was 19. Guy I worked for, got accepted …

AI assessment note: “they made me head of the studio tour. And that was the end of medical school.”

Q As you extended at CA from representing agents, later you got into banking, famously advertising with Coca-Cola. How do you think about building a new business that you weren't involved in at all?

A My son, Chris, comes home, and we're in this meeting, and he hears names. Columbia, Sony, and he starts hearing all these things. He said, Dad, what are you doing? I said, we're gonna sell a motion picture studio to an electronics company. He said, Dad, how do you know what you're doing? And I looked at him, and I said, Chris, I said, I'm learning as I go. Now, I was lucky. I had a guy named Herbert Allen, who is a prince among men. He just adopted me at an early age. When I had a problem, I called him, and we did every deal together, every single deal, and we basically did all the deals in Hollywood at the time, and Herb Was gracious, and had no ego, and ran his business like we ran ours, family business. I had a question, didn't matter how stupid it was, and man, I had some stupid questions. Herb guided me through it. We must have done a dozen mega deals together. I had a real serious mentor in investment banking, but there were things I had to learn as we went. I didn't know what Hart Scott Rodino was until someone said to me, have you, Satisfied heart Scott Rodino. There was no Google. So I had to figure out What that was, and I remember calling my stockbroker at the time, asking if he knew what Hart, Scott, and Rodino were, and he joked, and he said, they're a law firm. I said, that's not possible. Then he said, no, it's a law, and you have to check off certain things to d…

AI assessment note: “I said, I'm learning as I go. Now, I was lucky. I had a guy named Herbert Allen”

Q So with that idea, That you could do anything you wanted to. At what point in time did you get interested in the entertainment world?

A That was a complete accident, frankly. I lived in a area of the San Fernando Valley where Eli Broad built with Kaufman and Broad a zillion tract homes in the San Fernando Valley, and we had one of them. We were four blocks from the RKO studio backlot, so I would- Go do my paper route after school when I was nine years old, and when I got done, I used to crawl under the fence with one of the guys that did the other route at around five 30 during daylight savings time, and no one stopped us. We'd go watch them shoot these serial television shows in those days, and they were in black and white on film. I got this strange education about how you actually Make something and put it on film to record it for posterity. Very old-fashioned technology. I've watched the people on the set, and how they interfaced, and how the director would move people around. They had a person I later learned was a continuity master, and that person made sure that when they were done shooting that scene, that the next time they did it, It looked exactly the same. Nothing was out of place. So I learned a lot, and I liked it, but I didn't like it enough to sidetrack me from being interested in science and math and wanting to go to medical school. That was all I cared about, was getting to medical school.

AI assessment note: “Go do my paper route after school when I was nine years old”

Q What are the different lenses of what makes a successful talent as a creative than what you've seen, say, as a founder in tech?

A Nothing. I had founders start with an idea, and usually nothing else. Let's put off to the side a technical founder who may have come up with a fabulous algorithm that no one else has, but he still has to have an idea for it. What's he gonna do with it? What's the application? Who's he gonna sell it to? They don't do these things for charity. And it's the same with a writer. Michael Crichton sitting across from me saying, two years, he couldn't work. He just was blocked. He just, all of a sudden, out of the blue, he said, I have an old idea, but I don't think it works. What about three people? One's older, two are younger, and they're caught in an amusement park off the coast of South America someplace. The amusement park breeds dinosaurs, and It's like anything else, Michael. They get loose somehow, and it's havoc. He said, what do you think? I didn't skip a beat. I said, look, my son loves dinosaurs. I love dinosaurs. And Michael went and in five months wrote the book.

AI assessment note: “Nothing. I had founders start with an idea, and usually nothing else.”

Q How's your life turned out differently from how you expected it to?

A I had a plan, and it didn't work, is what it boils down to. Left CAA To go to Disney with the hopes of spending five to six years running a public company, and then I wanted to get involved in the State Department, because I love negotiating, and I wanted to have a job working in the State Department. I had spent a lot of time raising money for the Democratic Party, and I thought by running a public company it would give me a foundation. I had been enough as an agent, I wanted to be on the buy side, And I wanted to run a profiled business, and then I wanted to go to the State Department, and I'd say within 48 hours of joining Disney, I knew I had made one of the great mistakes of my life, so when you talk about mistakes, I missed every cue when I went over there. It was the worst, most horrific experience imaginable. I mean, they wrote a book about it called Disney Wars, and it's quite accurate. Jim Stewart is not a guy that Writes things that aren't true in anything he does, and it just didn't turn out the way I thought it was going to turn out. Now, I can't complain, because if I did that plan, I wouldn't be partners with Ollie right now having the time of my life, so I got lucky in a strange way, but it was a rough road for part of it.

AI assessment note: “I had a plan, and it didn't work, is what it boils down to.”

Q How do you think about your framework for building a business?

A They're all the same. They're the same fundamentals. You find great people, you flesh out their ideas, you back them all the way, you raise money for them, you get their product going, you help them market it, you help them get sales, and you distribute it. It's that simple. They're all the same. And they all have one factor that goes through each one as a common denominator. For me, not for anybody else. I can't speak to anybody but me. It's about the talent. The rest is irrelevant. Every business I've been involved with. So you talk about advertising. The minute I knew I had the Coca-Cola account, Even before we closed the deal, I went out and I started looking for talent, and the only thing I know how to do is find talent. I don't know how to do anything else. I went out and I started asking a lot of questions. I don't wait for anybody to call me. I will call someone, and by the way, I don't wait for them to return my call. If I call you and you don't call me back, you'll hear from me in a couple hours, and you'll hear from me 10 times till I get you on the phone. And I have no ego about it. I don't play this stupid game that a lot of my friends play. Well, I've called them. We didn't wait.

AI assessment note: “You find great people, you flesh out their ideas, you back them all the way”

Q When you now are meeting with people, let's say it's a pool of capital that might look at what you're doing as a potential investor. What do you think you do differently than maybe what Ali might have done before or other people in the industry when they're trying to approach raising capital?

A I tell the people I'm meeting with that I think I don't like the meetings to go more than 20 minutes. I tell them up front. I don't book an hour. I like to give people back what I call bonus time, and I say that at the end of every Zoom. I don't do long phone calls, which I had to teach Ali about because He couldn't understand why he had no time, and he had no time because he was too long on each call. People want to get stuff done, and they want you to get stuff done. If I'm pitching to a pool of capital, they hear this every day, and I'm very open about it. I said to someone on the phone, one, I know you want to see a deck. I think they're stupid. I'm happy to send it to you. I will send it to you, but you better investigate me and Ollie and our partners because we're the ones going to be doing the work. Number two, every person in my position tells you they're the greatest thing since the wheel. It's all baloney. We're not. We're good at certain things and not so good at others, just like everybody else. I said to someone at a big foundation yesterday, we were in a giant meeting, and I think they were in a state of shock. I said, I can't believe you're sitting through this. And the guy looked at me, he said, what are you talking about? You asked for the meeting. I said, but you take these meetings every day. And everyone's doing what we're about to do, which is tell you we'r…

AI assessment note: “I don't like the meetings to go more than 20 minutes.”

Q How did you think about helping the people find a job that either didn't fit in your culture or they couldn't cut it?

A It's a very excellent question, but it's a pretty simple answer. We move them from the sell side to the buy side. When you're on the buy side, the phone rings. People are looking for you to help them, give them money, tell them you'll make their project. When you're on the sell side, you have nothing. Being a sales person in the entertainment business is one of the top five hardest jobs there is. I remember a friend of mine who was on the buy side for 30 years. He was one of the most powerful guys in the business, and at the end of his run, running a big studio, He got pushed out by a younger guy. It happens. I'm sitting in my office, and he calls me, and he said, I need some help. I said, sure, what can I do for you? Because he had helped me for 20 years, and he said to me, my phone isn't ringing. He said, I don't know how to make my phone ring. No one's calling me. What do I do? And it was fascinating. He was a buy-side guy. He wasn't entrepreneurial. He was in a big organization that was stratified, And people called him because they needed something from him. When he was sitting in his office in Beverly Hills, not a buyer with nothing to offer. He didn't know how to generate his business. He didn't know what to do. So a bunch of us went over and sat with him and tried to educate him on being entrepreneurial. I have a thesis about building businesses. I've done three. It's a…

AI assessment note: “We move them from the sell side to the buy side.”

Q When you look at that last year, from where Travel was when you got there to now. This concept of building momentum, what did you see, and what did you do when you say Ali was going to have to keep up with you to get from where you were a year ago to today and forwards?

A It's not a science. It's kind of an art form, and I'm not the only person that does this. I have so many friends that are extraordinary CEOs, and they create inertia. Around them. They do it with simple rules. It's the same common denominator for all of us. If you asked each of us how we do it, we'd all give you the same story, but with different descriptions. For example, I don't know any great executive that isn't the first person that'll jump out of the foxhole when there's a problem. So leading has got to be done by example, not by talk. People that talk and pontificate are worthless. When we built CAA, one of the things we did, all of us that started it, is if we asked someone to do something, it was nothing that we wouldn't do ourselves. And at the beginning, when they didn't do it, because that's most people, they put it off. We just went in and did it. And let me tell you, that had a humongous effect on the culture. We had a system that if you and I were partners and you were an agent with me, And we had a book slip system. There are cards with your name on it, and the system was, if I wrote you a note, and it was hand delivered by someone in the mail room on your desk, it had to be answered by the end of the day. Even if it said, I don't have an answer yet, but you had to write on it, cross out what I wrote, and write me back, Michael, I've got it, you're right, you're…

AI assessment note: “When we built CAA, one of the things we did”

Q What are some of the most important ways you've used systems to manage people?

A The key to a good management is accountability. Our systems are such that everyone gets follow-up notes on what they have to do, and they keep their own. But at CAA, for example, our follow-up was impeccable. When we were in the investment banking business, we brought that attitude to investment banking, and our follow-up, it was flawless. We never made a mistake, because it's rote, it's not rocket science. Anyone can be taught to follow up, yet very few people do it. Anyone can be taught to make outgoing calls and generate momentum, but very few people do it. When I started with Ollie, I did exactly what I did When Marc Andreessen had me move to San Francisco, I have put Ollie into over 200 meetings in the last nine months with smart people, and I've not gotten one negative back, and I'm very proud of him. He listens great. He's smart as hell. He has this extraordinary ability because he learned the credit business from the ground up. Credit guys look at things through a different lens, and they're very risk-averse. He's really risk-averse, yet our venture business is like being in the Wild West, because it's mostly risk, because you never know. Who knows? But Ollie's taken that credit lens and put it on top of our venture business, and it's been incredibly helpful, and he wants to learn, and he works, he works like I do. He's 2407. I can get him on the phone Sunday at 11 o'cl…

AI assessment note: “Our systems are such that everyone gets follow-up notes on what they have to do”

Q If you harken back to your conversation with Patrick Collison and reflect on the mistakes you've made as you look out, let's just focus it on what you're doing with Alia Treble. What are the most important mistakes that you want to make sure you don't make again?

A It's a fascinating subject to discuss because I am the world's greatest cheerleader for talent, any kind of talent. I want them to succeed. It makes me feel good. I'm probably the world's largest critic of myself. I've had the same writer put me on the cover of a magazine calling me brilliant, and then four years later write an article that I'm an idiot. But I'm my own worst critic. The writer said nothing compared to what I say to myself. And one of the things I realized early on when Mark Andreessen and Ben Horwitz invited me to be on their board in the late nineties, I never had a mentor. I didn't have me who'd been through it and was older. I had no one to say to me, don't do this, do that, and I've made a lot of mistakes, and some of them were obvious, but not to me, and I'm a horrific advisor for myself, because I have this thing from the time I was a kid that I can do anything, and I can fix anything, and I can Do good. If somebody's got something that needs to be done, I can do it. And I'd say by and large, I probably do that for friends particularly. I'm in the middle of helping friends settle their divorce because I don't want them to go spend a zillion dollars on lawyers, and I came up with a thesis, and I Henry Kissinger'd it between both of them. I enjoy doing that. I'm great at giving advice to other people, but when it comes to me, I sometimes miss it by a mile. …

AI assessment note: “I'm in the middle of helping friends settle their divorce”

Q In your many meetings with people gathering intelligence, As you look around corners, what do you see coming?

A I love that question because I just addressed that at dinner last night. I said to a table of people, I wish I was younger, and everyone said, yeah, sure you do. I said, but not for the reason you think. I just want to see how it all turns out. The stuff going on right now, oh my god. I haven't been this excited since I started CAA. Where I got to meet all these brilliant creative people and put their ideas together and help them form them. And I meet these young men and women, they're not, they're like 26, seven, and eight, nine. They're wicked smart, they're perceptive, they're personable, and they want to change the world. I remember living through all the format changes in entertainment. They changed constantly. I remember having a reel-to-reel tape recorder. Then I remember having a giant cassette player with those big giant cassettes long before your time. And then I remember getting a smaller cassette, and then a mini cassette. And then Sony came out with a video camera, and then Matsushita came out with one Panasonic. And then I saw floppy disks. And then I saw CD-ROMs, then I saw CDs, then I saw DVDs, and then I told three of the five record companies I consulted for that all their packaged goods were going to disappear, because Nathan Mirvold, who is the smartest guy, was employee number three at Microsoft, was CTO, said to me in a meeting one day in the nineties, Mic…

AI assessment note: “I remember living through all the format changes in entertainment.”