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s a cofounder of Creative Artists Agency, Ovitz revolutionized how big deals in film, TV, music, and corporate media were done from the 1970s through the 1990s. Following brief stints at Disney and his own mobile content start-up, he reset his career as an adviser in Silicon Valley.
HBR: In your memoir, Who Is Michael Ovitz?, you say that agents are first and foremost sellers—of themselves and their clients. What makes a good salesman?
Ovitz: Sales can be done aggressively—a constant barrage—or with thought, more elegantly. We tried to sell based on the quality of the client and to make the presentation softly. But we were aggressive in that we would never stop. We wouldn’t take no for an answer. Selling was easier for us than for others because we would only sign talent we really believed in for the long term.
But when you were just starting out, how did you sell yourselves to those quality clients?
It was an uphill fight. We were young, so we had to differentiate. We could not perform like traditional agents—fielding calls and trying to sell clients on jobs. Our thesis from day one was that we would take clients’ dreams and put the projects together.
The strategies you used to turn CAA into a powerhouse sparked resentment. People have called you a bully, a villain, and worse. If you could do it again, what would you do differently?
At the time I thought being vulnerable was a sign of weakness and that any weak link would affect the business. We were the ones who got stuff done, and that meant we sometimes ran a little rough over people. We always had to be moving forward and winning. We had to have 100% market share, the number one book, the number one movie, the number one TV show. I discovered after the fact that we could have gotten just as big and still let a few others take some wins.
But the tactics worked.
Really well. I remember when we sold ER to a very unwilling NBC. They didn’t like the pilot, so we manipulated everything we could to get it to work. We got Warner Brothers to push hard. We got Steven Spielberg and Michael Crichton to make calls. We pushed from every angle. We believed in the show. But we ran over a lot of people at NBC to do it. And there was a cost associated with it, which I personally paid and would have preferred not to.
In your book, you call out betrayals by former colleagues and friends: Jim Moloney, Michael Eisner, and Ron Meyer. Why rehash those stories now? Are you trying to learn from the experience? Help others to do so?
I’m telling a story about lessons learned: things done right and things done terribly wrong. Each of those relationships went wrong for a different reason. One stayed wrong. One ended because the individual passed away. And one came back to life, which is pleasing. I’m at a place in my life where I can look back. As an investor and a consultant in Silicon Valley, I’m meeting the most brilliant young people and trying to give them advice, and the lessons they like are about the mistakes I’ve made as much as the successes.
You’ve been involved in so many high-stakes negotiations. What’s the key to a successful outcome?
You need to know where you want to end up before you engage. At CAA we spent hours on prep work for the larger negotiations. We did studies, readouts, role-playing—everything we could. But even in the smallest negotiation, we always wanted to know how the meeting would end before we walked in the door. How do you manipulate the scene to get what you want for your client but leave something on the table for the other side so that when they walk away, they feel happy?
But if your counterparts have their own ideal outcome and it’s different from yours, how do you reach an agreement?
That’s the fun part of negotiating. We had different ways of handling that. Sometimes when we were on the buy side, putting together a TV show package, someone would come in and quote us a fee for an actor that was not in line with the budget, and we’d say, “There’s nothing to respond to. We’re going to recast.” One time an agent asked for a client fee that was double what ours were getting, and we said, “You’re under-asking. You should get five times our clients’ fees added together.” The agent understood, and when we were done laughing, we got down to making a serious deal.
But strong-arming was a tactic you used, too.
When we had leverage, we used it. Take Jurassic Park. That package was developed at CAA. Michael Crichton pitched me the story. I gave the book to Steven Spielberg. He said he was in. So was Kathleen Kennedy, a producer. We controlled all the elements. So we had the ability to go to the first studio and say, “We have good news and bad news. The good news is that we have a movie based on a book by Michael Crichton that will be a best seller. It will be directed by the great Steven Spielberg and produced by the great Kathy Kennedy. You need no stars. We have three young cast members. The bad news is that we and the clients control it.” We asked for a partnership deal in which clients and studios were paid the same, dollar for dollar, and said they had one day to come back to us. It was said nicely, but it was as strong-arm as you could be. If they said no, we already had it backed up and sold at another company.
How did you know whether people would collaborate well?
In the Valley now, I deal with men and women who believe they’re unstoppable. In the entertainment business, people were just as spirited. But you could tell if they’d be collaborative by how they accepted suggestions. Look at Mark Zuckerberg. He’s not afraid to have brilliant people working for him who tell him what they think. When we put Ghostbusters together, Dan Aykroyd wrote it, but Bill Murray put his imprimatur on it, and [the director and producer] Ivan Reitman and [the late actor] Harold Ramis—may he rest in peace—added theirs. Understanding the creative process, doing our homework on the participants in a package—that gave us a sense of whether they could relate.
When projects took forever to get going, how did you have the patience and focus to keep at it?
It was strictly belief. Rain Man went through four directors in three years before we shot a foot of film, but the motor for that project was Dustin Hoffman. When a client wanted to achieve something, it made my job much easier. All these brilliant directors—Marty Brest, Steven Spielberg, Sydney Pollack—were trying to find a third act: positive change at the end of the movie. Finally Barry Levinson said, “There is no third act.” After talking it out, Dustin Hoffman agreed with him. It was an interesting creative moment. There were hours of discussion. Should Dustin as Raymond show some improvement? But with his type of autism, it had to stay the same. So we agreed to take that risk. The newspapers and daily trades predicted that the film would fail, the head of the studio would be fired, the clients would be angry, I would be fired. But lo and behold, it went out the first weekend at $6 million and did the same for the next 50 weekends and won four Academy Awards.
How do you know when risks are worth taking?
From age 17, when I got my first job at Universal Studios as a tour guide, I watched everything that came out on the big screen and every television show. I read every top 10 book, every script, notes on the scripts. I had subscriptions to several hundred magazines, which I would skim through. I was a student of popular culture, and my life was all about learning what people wanted to see. And then, as the ultimate fan boy, I did things I would want to see, too.
How did you manage your time?
It’s the same in any business. You could be a doctor, a lawyer, or a writer and an interviewer; an agent, an entrepreneur, or an Indian chief. Time is our most valuable commodity. I was obsessed with how to get more hours in the day. A client even gave me a 25-hour clock as a gag gift. One key to productivity and time management is responsiveness. At CAA we had a system where if you were asked a question by a colleague, you answered it; we kept notes on everything, and we shared information. We prioritized by the clients, the agent, the buyer who had the largest need. We returned every phone call by the end of the day, so you’d see people sitting in the office until 8:00 at night doing that. Also, honesty: If you do not have an answer for something, tell the client or buyer, “I don’t know.”
You had a family. How did that work for you personally?
Sometimes good; sometimes not so good. My wife and I were married when we were 21 years old. She helped me start CAA. She was a secretary, along with the wives of the other founding partners. We worked seven days a week. We came into the office at 7:00 AM and we’d leave at 11:00 PM. I didn’t have children until six years into CAA. Chris Ovitz, my first son, was a game changer for me. Having children is a giant responsibility, and I worked around it. I would leave CAA at 3:00, be on the phone in the car until I got to the John Thomas Dye School, watch one of my three kids in a sporting event while still making calls, congratulate them whether they won or lost, then get right back in the car, on the phone, to the office. It was a way of life for 25 years.
You’ve described your move to Disney as your biggest mistake. Why was your tenure there so short?
I don’t think Michael liked having an equal or the thought of losing control. The funny thing is that there was ample work for both of us, but we never got it right in terms of splitting up responsibilities.
After that and watching your new start-up fail to take off, how did you regroup?
Whenever I had a setback, Michael Crichton, a good friend, would tell me, “There’s always another horse race. Just take some time off, then jump into something that interests you.” In the mid-1990s I got interested in tech. In 1999 I was asked to be on a board. I got crazy infatuated with the Valley. My first year there I took 400 meetings just to get that frame of reference I used to have at CAA.
You’ve talked about similarities between Hollywood and Silicon Valley, but what are the big differences?
The scale is different. The entertainment business has instant gratification. You could pitch a television show or a record and have it out in a short period of time. But when you are working with the complexities of bioscience or self-driving cars, ideas take years and years to develop. Companies like Uber, Airbnb, and LinkedIn have taken years to incubate and to get right before they’re ready to go public or sell.
You’ve described yourself as a chameleon: different at home than at work, also inside and outside the office and with various clients. Why did you operate that way? Do you feel you can be more authentic now?
Let me answer the last part first: 100% yes. I’m in the most comfortable part of my life, particularly having finished this book and gotten all that off my chest. But back then I had an act. When Ron Meyer and I decided to get into the film business from television at CAA, we felt we needed to create personas. We decided to play good cop, bad cop, and I took the bad cop role. The chameleon side was something I had always done. I felt it was easier to communicate with people in the way they chose. If they chose to be soft, be soft. If they chose to be rough, be rough. It was an aikido move—to redirect their force back on them.
How did you get your agents to work together?
We knew that you could manage by creating competition between employees. Or you could go a different way: a combination of American team sports and the Japanese philosophy of nemawashi, or management by consensus. So people are invested in and help one another. You’d sit in a staff meeting and someone would say, “We have a singer who wants to do a film,” and a literary agent would say, “I’ll help.” He had no reason to, but he did, and we’d get a movie made. That happened with Prince and Purple Rain. No one said the idea was stupid. Half a dozen agents said, “Let’s try.”
I have to ask: Did you know about all the sexual harassment and abuse in Hollywood?
We didn’t know what we know now. We did deal with Harvey Weinstein, and we had no idea. And we didn’t have a lot of clients complaining about problems. When we did, we took care of them. But we didn’t allow clients to have meetings at odd places, and most of the time—in particular, with female clients—agents accompanied them.
In your book, you talk about having boundless ambition but also constant anxiety about your ability to achieve your goals. Was there ever a time when you felt at peace?
When we sold Sony to Columbia Pictures—a deal in which I represented Sony but had great relationships on the other side—I was sitting in a room after everything was signed with the investment banker Herb Allen, a good friend, and I looked at him and said, “Well, what’s next?” And he said, “You’re the dopiest guy. Why don’t you take a couple of days and enjoy the fact that we’ve just sold a studio, everyone got what they wanted, and we had a good time doing it?” I couldn’t. Within five days I started working on a deal to help Matsushita buy a studio. The anxiety came from being the operator of the business. Every day when you turn that key, you have overhead, so you have to run it, be creative, keep your people’s spirits up and the machine running and turning a profit and moving upward. Occasionally I’d step back and say, “My God, look what we created.” But those moments didn’t last very long.