‘Maturing’ Endeavor Strikes Gold

Upstart talent agency Endeavor has become a "doppelganger" of Creative Artists Agency, following in the footsteps of the 10-percentery founded by Michael Ovitz, according to a July 27 profile in the New York Times.

However, the Gray Lady posits that Ari Emanuel’s baby needs to continue showing that it’s all grown up now.

Despite a much smaller staff and client roster, Endeavor makes up for lack of bodies with "the sort of quick thinking, ferocity and barely bridled ambition that carried CAA to the top," the Times reports.

The company seems to have smoothed what the paper called its "rougher, frat-house edges." An embarrassing 2002 sexual harassment suit revealed, among other things, "office escapades that included rampant pot-smoking, obscene hazing at corporate retreats, sexual romps on desks, and one agent demanding that his assistants book prostitutes for him," according to the Times. At the time, only one of its dozen agents was a woman.

Endeavor has moved onward and upward since then, with women comprising about half of its agent ranks and one-fourth of its 26 partners. And the company now challenges CAA, William Morris Agency and International Creative Management for industry supremacy.

Certainly, each agency has different strategies and business philosophies that make "ranking" a pecking order difficult. For instance, CAA is making aggressive moves into sports and corporate consulting while Endeavor is concentrating on ownership deals for its clients. WMA and ICM can monetize long-term relationships, given their long histories in Hollywood.

But everybody loves a list, and on the 2008 film front Endeavor ranks behind CAA, which landed about 10 directors and 13 stars in film projects while Endeavor placed six directors and nine stars in major films.

On the TV front, TVtracker.com ranked Endeavor ahead of CAA for the top spot for 2007, based on the number of overall network and cable deals, and in representation of "showrunners" – the writer-producers who supervise TV series.

In annual income, the lines become more distinct. The Times estimates Endeavor’s revenue at just more than $100 million per year, which it says is "well under half that" of CAA.

William Morris and ICM also appear to out-earn Endeavor, despite lagging behind in the Hollywood pecking order. The paper attributes the discrepancy to "legacy," or steady cash flow from movie and TV work booked over decades of representation.

Success has many fathers, as the saying goes, and Ovitz isn’t shy about claiming paternity when talking about Endeavor.

The CAA co-founder told the Times that Emanuel "and his crew have done the same thing we did, and people don’t really give that enough weight. In some strange, blasé way, it’s taken for granted."

Emanuel disagreed, saying he takes nothing for granted and told the Times "I feel like we’re just getting started."

However, Emanuel and Patrick Whitesell did acknowledge there is speculation that Endeavor is being groomed for a sale or merger, but insist no such deal is in the works.

And Emanuel, the model for Ari Gold of HBO’s "Entourage," is also bullish on Hollywood, despite changes in the industry wrought by digital media and the deterioration of broadcast television network dominance (and budgets), and a pullback among major film investors.

"You have the same number of content creators," he told the Times. "But distribution has grown."

In an economy of supply and demand, Emanuel said he sees opportunity actually exceeding the supply of talent – and agents. With more outlets for distribution, including cable TV, Internet and independent film buyers, the industry is on the verge of new prosperity, he believes.

Not everyone in Hollywood is as enamored with Endeavor, including several unnamed former clients who talked to the Times. They told the paper that internal coordination "lags" and that CAA is quicker to match its clients with each other on projects whereas Endeavor’s agents tend to advance and protect their own clients.

But with a recent flurry of agency shopping by name clients, Endeavor has at least broken even. For clients it has lost, it’s picked up others. Ashton Kutcher, Robert De Niro and two agents recently left the company, but it’s also picked up Ben Stiller, Jack Black and Amy Poehler.

The ability to mix it up with long-established agency leaders indicates to some that Endeavor has not only survived, but matured, since the "old boys club" corporate culture was excised as a result of agent Sandra Epstein’s $2.25 million settlement in the sexual harassment case.

"The firm grew up," Endeavor co-founder Thomas Strickler told the Times.

And so have many of its key partners, now well into their 40s, finding new interests and perhaps sparking the speculation that a sale may be in Endeavor’s future despite Emanuel’s denials.

Emanuel himself is an example. He’s been a key player in Sen. Barack Obama’s Hollywood campaign and is a regular contributor to the Huffington Post politics and culture Web site.

He told the Times politics won’t become a full-time preoccupation nor does he intend to set aside his personal client list, which reportedly includes Larry David, Mark Wahlberg and Martin Scorsese.

His other key lieutenants told the Times they are staying put, too. Whitesell said Endeavor has become too interesting lately for him to even consider the prospect. "People want to be part of it," he told the paper.

As if further proof was necessary, within days of the publication of the Times’ Endeavor profile, Hollywood Deadline Daily blogger and industry watcher Nikki Finke reported that advertising conglomerate Interpublic has quietly upped its minority share to a majority stake in Endeavor’s New York-based Endeavor Marketing.

The company reportedly reps brands including American Express and Revlon, and raises cash for the agency as well as giving it "a foot in the door to the lucrative corporate branding market, which all the Hollywood agencies are chasing these days," according to Finke.