MEDIA CFO — Episode 004 — Lindsay Conner of Manatt, Phelps & Phillips talks to Tobias Jaeger about brokering some of the biggest deals in Hollywood and driving US-China film and business relations
We sat down with Manatt partner Lindsay Conner, who has always been a bridge between capital, studios, and producers. Lindsay was instrumental in brokering, negotiating, and closing some of the most prolific US-China film deals in recent history as well as the first series deals on Netflix.
Lindsay Conner is a partner of Manatt, Phelps & Phillips, where he is also co-chair of the firm’s media, entertainment, and digital practice. He studied at UCLA, Occidental College, and Harvard and since he got started more than 25 years ago Lindsay is a regular on all top attorney lists and rankings including the Legal 500, Chambers, Best Lawyers, The Hollywood Reporter, and Variety. Besides his work in everyday media transactions for production companies and studios, Lindsay negotiated one the largest US-China slate deals ever to the tune of a half a billion dollars.
“The technology certainly has changed our agreements. Lawyers, in particular, have to try to stay ahead of the curve. Be aware of the technologies that are out there, the technologies that may be used, the rights that may be necessary to ensure that content is available and protectable in the broadest range of technologies and that the business terms deal appropriately with those different technological outlets.”
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Tobias Jaeger: Lindsay, welcome to the program.
Lindsay Conner: Thank you, Toby.
TJ: It’s such a pleasure to speak with you. As you can hear, my voice is a little scruffy, but I’m sure we will get through this.
LC: Sounds fine to me.
TJ: I’m really excited to talk to you because obviously, you’ve had an extremely long and prosperous career in the legal practice, especially for the entertainment industry. And I was curious and wondering how did you get into it? Tell us a little bit more about your journey.
LC: Well I grew up in the entertainment industry. My dad was in it for his whole career, and by the time I was aware of my surroundings, he was a personal manager here in Los Angeles. So I grew up in the business. I had Variety and Hollywood Reporter around the house, and I think I learned to read a little bit through them and probably surprising I don’t talk the way they used to read with their very special lingo. But I did grow up in the business. I was very interested in politics from an early age. And I think law was more something I thought of as an avenue to go into politics one day. Although I knew I’d want to see entertainment law too when I got to that point.
TJ: Yeah, I know you’ve lived here your whole life, so one of the things I was obviously wondering about is, do you think that influenced your decision?
LC: No question. I think growing up in the industry, you either like it, or you don’t. I suppose some people are driven away from it. I was enticed. I thought it was fun to see how film and television especially would be made and thought it would be interesting to go into that.
TJ: So you mentioned politics, that you were interested in that. Did you pursue that for a while and then come around to the entertainment industry? What was that path like?
LC: Well I did sort of pursue a dual track. Though the political side came up, not out of nowhere, but I hadn’t intended to be in politics so early on. I had just started my legal career when one of my mentors from UCLA, where I had been student body president as an undergraduate, asked me to run for his seat on the Los Angeles community college board. He was retiring. The community college board is a seven-member board that governs America’s largest community college system. And it turned into a big campaign. So I was elected to this city-wide public office when I was 25 and all of a sudden I was in politics as well as an entertainment lawyer. So I did both for a number of years, and enjoyed both, but eventually decided that politics was less attractive. And I think it’s gotten even less attractive since I stepped out of it.
TJ: I can imagine. Probably not a bad decision to do something honest instead.
LC: Well you know what, the good thing about the community college board is that it wasn’t subject to the kind of campaign contributions and the other things that distort national politics. So that part of it was fine. But I did it for 16 years and had a great run and felt that I had made a real contribution, but it was time to step off of the community college board, and there was really no other office that I was excited to run for at that point. And I concluded that being in the private sector, at least at this point, would be the right way to go.
TJ: Yeah, so as you were doing that, working to make a difference there, you simultaneously practiced law and got started there.
LC: That’s right.
TJ: What was your start like? Can you still remember the first couple of transactions or deals or things you worked on?
LC: I started at what was then the biggest entertainment law firm in the country, a firm called Kaplan Livingston Goodwin Berkowitz & Selvin.
TJ: It’s always a mouthful.
LC: Yeah, it was tough on the receptionist, I tell you. She had to answer that every time she picked up the phone. It was a combination of deals representing production and distribution and financing entities, and also sometimes representing talent. And I had a mix of that from the partners who were there at the time. And both were enjoyable and profitable.
TJ: Yeah. You mentioned the talent. Obviously, this was an industry with quite eccentric and eclectic people. And obviously, as a lawyer you’re trying to focus on the substance and not the hyperbole. How did you bridge that when you were working on deals or transactions or things like that with talent or creative people?
LC: When you’re a young associate you do whatever the partners ask you to do. And in fact, talking about fun things that you don’t expect to do when you went to law school. One day the senior partner for whom I worked called me in, and one of his best clients was Gene Wilder. And he said “This isn’t exactly a legal assignment, but I need you to do this. Gene is writing a screenplay, and he wants to know the words in German to an old German song called ‘I Left My Heart In Heidelberg’.” Which I had never heard of before. The closest I ever got was ‘I Left My Heart In San Francisco’, and that was nowhere near what Gene Wilder was looking for. So I had the afternoon and no Google in those days and no opportunity to do it the easy way, to call around and find the lyrics. Which I eventually did. And then I had to call Gene and tell him what the lyrics were letter by letter almost and then he started singing the song in the middle of the call. He was as nice as he could be and very grateful to have these lyrics for his screenplay that he was writing. So those are the kinds of things you don’t expect to do when you’re studying in law school.
TJ: Yeah, that’s quite amazing. Especially since then you didn’t have Google. I have a couple friends who are my age that became lawyers, and I always find it amazing of how technology has helped that industry as well. Because obviously if you need to research information, which is a great part of the work, now it’s all available, but you still need to interpret it, of course. But I mean, such an assignment sounds like great fun.
LC: It was. You had asked about bridging the gap of the creative side and the legal or business side. And this is an important part of what we do. It’s really a case of protecting the business aspects, the financial aspects, and of the legal aspects so that the creators can produce their magic. That’s what my job is in a sense when I’m working on a specific creative project as opposed to a more corporate project.
“I kiddingly said at one conference that part of the problem getting the two sides of the Pacific together in the entertainment industry is that China is a nation state with its way of doing business and Hollywood is a nation-state of mind with its own way of doing business and for a while you just couldn’t get the two together. That happily has changed, and people have a much greater understanding and appreciation of the other.”
TJ: So you see yourself as kind of the protector of whatever’s created in your capacity as a lawyer, that you just want to make sure it’s structured properly and people are protected in what they do?
LC: Absolutely. Nothing gets made without financing and financing is an important part of my job. Making sure financing is structured in an intelligent way. Whether it’s for an individual project or for a slate of projects or for a company. Then making sure the production is done properly and then once you have a product, how is that being distributed? What are the agreements for distribution? Sometimes that’s all wrapped up in one package, one agreement. Whether it’s with a studio or whether it’s with a Netflix or an Amazon, someone like that. And sometimes things are separately financed, produced, and distributed.
TJ: You just mentioned kind of the new companies. Do you feel them entering into the market has changed the dynamics of this? That now there’s someone that has global distribution from the get-go, that working with them is different from let’s say another studio or the existing players?
LC: The streamers have certainly changed the television business radically, and they’re starting to change some of the film business as well. They changed it in part because of the financing model. Most of the streamers will pay you the cost of production of a show plus some kind of premium. That’s certainly the Netflix model, and right now they’re the leading streamer. That eliminates deficits, which producers used to have to bear because the license fees being paid by television networks weren’t enough to cover the cost of a show initially. So the deficits have been eliminated, but the streaming services also now increasingly want worldwide rights or at least a large portion of the world in the case of Amazon. Netflix wants worldwide rights, and they want them for a very long period of time. So you don’t have the same kind of back end sales that one could have in television and still can’t have with the broadcast networks if a show is successful. So what they’ve done, the streamers, is they’ve taken away the strikeout, and they’ve taken away the home run. You can make a profit on everything you do. There aren’t going to be the enormous profits of the big hits, but there aren’t going to be the losses of the misses. That’s changed our business, and it’s now starting to change the film business too. Or it’s given people another alternate place to go to get financing and have a different experience. That’s not to say that the major studios are gone. Fox has just merged into Disney. So we’re down to five majors plus Lionsgate, which is very close to being a major. But we have these new entrants in our business, Netflix, Amazon, Apple, that are spending an enormous amount of money and we really have to consider them major studios. Particularly since they’re all now making feature-length content as well as episodic content. Really the distinction between film and television that 20 years ago was so strong is today pretty much blurred.
TJ: Yeah. It blurred a lot, yeah. I’ve been wondering about this. Do you feel like this surge of television and the blurring, that that’s just kind of a temporary phenomenon or do you feel like that it’s just going to continue that way? That may be one day we don’t really make the distinction anymore other than of course film being one two hour episode rather than 10 one hour episodes or something like that. Do you feel that’s shifting more and more?
LC: Yeah, I think that distinction between film and television is, if not gone at least going away. In fact in agreements that I do now, usually, I refer to features and episodic series. It’s not so much whether it’s going to be exhibited in a movie theater or exhibited on Netflix or Amazon Prime. It’s really about the length of the content. A two-hour piece of content, we’d consider a film. And I’d consider it a film whether it’s going to be in a movie theater or going to be on Netflix. But it’s really a feature. It’s a feature length. An episodic series might be on a broadcast network, but it may also live on Netflix or Amazon or Hulu or one of those services. And that’s a series. I think for most talent the distinction of film and television which was so important years ago is now almost completely gone. People don’t care where they perform. They’re happy doing features wherever those features are going to be shown. They’re happy doing episodic series as well. And our business has switched from being a film or television business to being a content business.
TJ: Yes, that’s right. I mean there’s so many new aspects to it, whether that’s ad-funded programming or even shorter stuff like on Facebook or even Instagram, Snapchat. Everyone’s in content now.
LC: Right. And just to illustrate how important the shorter forms are, Jeffrey Katzenberg has formed a company, Quibi, with substantial backing that’s designed to make what he calls premium short-form content. And it is a nod to the fact that so many people, particularly younger consumers, do consume their content in five minute or eight-minute bytes on the way to work or as they’re relaxing at home or working out in the gym. So we now have long form, classic film. We have what you might call mid form.
TJ: What is the new label?
LC: I don’t know if that term will stick, but that’s what I would think of as the classic television series, the 30 minute or 60-minute television series. And then we have short form content. Which is, in many cases, user-generated, the YouTube model. But now increasingly with the likes of Quibi going to be available as premium content as well.
“But another force has entered the picture, and that’s technology. And now you have to decide not only how you’re going to film something, but importantly how it’s going to be distributed. And technology is shaping the way we do that. When the internet didn’t exist there was no question of streaming or having the short form content that was out there. So technology now plays a role in addition to the creative and business side and the newest entrant into the picture in a sophisticated way is data.”
TJ: It’s definitely a venture that is going to be interesting to watch of A, how they approach just the sheer mass of content that they will need to produce, but also compared to, you mentioned YouTube where users are just kids out there doing dopey stuff and filming it, and people are watching that. How that’s going to translate to the premium short form where it’s scripted and professionally done.
LC: Well it’s a very broad market, and we’ll see over time what consumers want. My guess is that they want both the premium content for certain things and the spontaneity of the user-generated content for other things. So I don’t think it will be entirely premium content one day. I don’t think YouTube is going away. People are still going to be watching the crazy stuff that people and animals do. They’ll still be watching the things that get posted elsewhere in social media. But there will also be a place for premium content at all levels.
TJ: I find it really funny because often I think, especially in this industry, as soon as something new comes out people always have this idea of like oh, this is going to change everything as if all the existing stuff is going to vanish. I mean, that has never happened. When television came, it didn’t kill film. When streaming television if you will came, it also didn’t kill linear television. Obviously, it has changed the dynamics and the economics quite a bit, but film isn’t going to go away. I think there’s actually some places where film is doing a lot better now.
LC: And I believe that what you and I are calling the film business, which is really the theatrical film business, will continue. There is something special about that experience of seeing a movie with a bunch of other people. Whether it’s funny or scary or moving or thrilling, there’s something special about the big screen and the theatrical experience, and I don’t think it’s going away. There will still be television as we know it. The screens may be in different places, maybe everywhere in your home. But there will be a place for what we more or less traditionally think of as television. And clearly, people will be watching content on phones and iPads and a variety of other devices, probably one day including glasses with heads up displays and things like that.
TJ: With this changing landscape and also changing economics, we talked about the creative side of the business, do you feel there’s kind of a fundamental misunderstanding that creative people have about the business and also legal side of course and vice versa?
LC: I don’t think it’s a misunderstanding. People live in their own worlds if you will. Creative people like to create. Business people need to look at the bottom line so to speak. Lawyers are trying to protect an enterprise. And sometimes the misunderstandings come from the fact that it is a collaborative business. Unless you’re doing videos of your cat singing opera or something, creators have to have a budget. They have to get financed from somewhere. They have to live within a budget. Their work is legally protected, and it will get distributed in a certain way. So there’s that business and legal side of what they create that is important to getting the content created in the first place and then distributed and protected. At the same time, if the only thing that anyone focuses on is the financial aspect, the business people will be happy until they realize that what’s being created isn’t something consumers want.
TJ: I think that has happened a couple times.
LC: Yes and it’s interesting, the challenge of the sides collaborating, of the different sides of the equation collaborating, is probably going to grow greater rather than less. And the reason I think that is because historically there’s a kind of, not a tug of war, but a tug and pull between the creative side and the business side of the industry. And I’ll lump lawyers in on the business side there. So what a director needs to create, what an executive needs to be able to market a film or a show, back and forth. But another force has entered the picture, and that’s technology. And now you have to decide not only how you’re going to film something, but importantly how it’s going to be distributed. And technology is shaping the way we do that. When the internet didn’t exist there was no question of streaming or having the short form content that was out there. So technology now plays a role in addition to the creative and business side and the newest entrant into the picture in a sophisticated way is data. More and more over the years to come, we will see companies trying to find the perfect type of content or create the perfect type of content by assessing data. So it won’t simply be a question of a Netflix saying “Toby, we see you like these films, please consider these other 10 films.”. That’s what we now consider a pretty sophisticated use of data. It will seem less unusual in the future. Where I see companies wielding data going is to say how do we assemble this data in a way that we create the perfect film? That we create a film that most people are going to want to see. And now you’re going to have a pull from four different directions. You’re going to have the human creative mind, that original creative force that underlies all of it, the business side that has to still protect the bottom line on each project and for a company, the technologists who in advancing their technology effectively start to shape what the content is, and then the purveyors and analyzers of data who will step in and say that’s not going to work, but if we change these five scenes or change these two actors, this will work.
LC: The creative business has always been collaborative, but the numbers of people collaborating are going to grow.
TJ: Has that changed the contracts or documents or agreements you work on that there’s all these new components you need to cover?
LC: The technology certainly has changed our agreements. Lawyers, in particular, have to try to stay ahead of the curve. Be aware of the technologies that are out there, the technologies that may be used, the rights that may be necessary to ensure that content is available in the broadest range of technologies and protectable in the broadest range of technologies and that the business terms deal appropriately with those different technological outlets. So the technological piece is very much there. Data is the brave new world, the new frontier if you will, and right now the companies that we represent that are in the data collection business … And that’s not necessarily a reference to companies that collect data as their main business. They may collect it as a byproduct of whatever they’re doing. But those companies are thinking about how the data is collected and how the data is used. Much of the rest of business still isn’t that focused on data, but data’s the next frontier.
“And it will be an interesting question to see how well those things go together. Whether you can make the ideal movie or an ideal movie by mixing in the data at a very early stage or whether that turns out to stifle the creative process and make everything sort of cookie cutter where you don’t have the kind of eccentricity that gives you some of the scenes in film and television that we’re most fond of as we look back.”
TJ: Yeah. It feels like often organizations that started to keep track of things or collect data as a byproduct, they, once they’ve done it for a while, understand how much not just information but intelligence they can actually extract out of this. I had a conversation recently with someone who said: “Well, Netflix doesn’t share the information with the creators or the producers if you will.” And it was more of a philosophical debate I guess of if there’s ever going to be a point in time when they will share this or share more of it. Because I’m not sure if it’s right now just the holy grail or if they also, for example, don’t share it because as you said it’s a collaborative process. They don’t want to influence creators and producers by saying oh, this is something that works and then the next couple months they only get proposals for that type of content. Because I guess it’s the same with Henry Ford, who said: “If I had asked people what they wanted they would have said a faster horse.” Nobody would have said oh, can you build me an automobile? So I feel like with content there is this magical element. I don’t what to call it. But where you and I watch it, and we’re like, we would have never asked for it, but we’re really enjoying it.
LC: Yeah, I think that’s right. Initially, the use of data will be more in the selection of programs. I want to make that movie, or I want to make that show based on the data that our company has at its fingertips. But I think it’s inevitable that at some point producers and creators will look at the data and alter scripts based on it and make it a part of the creative process. And it will be an interesting question to see how well those things go together. Whether you can make the ideal movie or an ideal movie by mixing in the data at a very early stage or whether that turns out to stifle the creative process and make everything sort of cookie cutter where you don’t have the kind of eccentricity that gives you some of the scenes in film and television that we’re most fond of as we look back.
TJ: You were talking about all these different activities and things, obviously internal and external activities. Tell us a little bit more about how does a day in the life of LC look like?
LC: One of the great things about this job is that I never know when I walk in in the morning exactly what the day is going to look like. I always have a plan for the matters that I’m working on, appointments that I have, but clients call, email, text, WeChat, WhatsApp. There’s so many ways they make their needs known and all of a sudden the day can be off in a different direction depending on what client priorities are. And in a given day I could be dealing with five, eight, 10 different matters for a bunch of different clients. It can be anything from negotiating a deal in one case to reviewing documents in another to drafting or amending agreements to introducing one client to another and trying to see if there’s a viable business or business proposal there. All of those things go on in any given day and then obviously business development is part of what all of us have to do. So the day is a real mix. I think that makes it fun actually. But when there’s a lot of work piled up and emergencies on top of it, it can be quite a juggling act.
TJ: Yeah. I was about to ask, so what’s your personal recipe for kind of staying on course and not getting absorbed by the daily requests that you get?
LC: Well you do your best to prioritize the needs and have a plan as to how everything is going to get done. And you stick to the plan as much as you can. It’s harder and harder in a world where we’re constantly being hit with email and text and all of the phone calls, all the different media of communication. And clients have needs that pop up all of a sudden. A new idea, a new problem, a difficulty with an old agreement, something they want to change in a current agreement. And clients understandably and rightly expect that their lawyer will be there to handle it for them. So sometimes you have to put your plan to one side and jump on whatever needs doing today and get it done. And then go back to the plan. You have to be flexible in this job. I think that’s one of the things that makes it fun actually is that you don’t really know what’s going to happen when you walk in the door. But you also do need to have a plan or at least some way to keep track of the things that need to get done today or this week so that you can keep on course for as many of them as possible.
“There was a period two or three years ago where there were a lot of, how should I call it, romantic shows, dating shows and things like that, on Chinese television and one day the government announced that there was just too much of that and they were pulling certain shows off the air and content would be directed in a different way. You have to understand that you’re going to be going into that kind of environment and accept the fact that some things may be a certain way that is not like Hollywood or some things could change positively or negatively, and it’s not as if you’re going to have an opportunity to change it. You have to roll with it.”
TJ: My theory is that I think probably you don’t sleep at all anymore because obviously, you work a lot with China, so that brings a whole nother timezone aspect to the game. You’ve done a lot of work in China or with China, how did that come about, the interest for it or the direction that you’re one of the people from China that people would go to in this town and vice versa?
LC: Well it’s been very exciting and a great privilege for me. Its roots probably are in the fact that I did grow up in Los Angeles and in some ways was always focused on the Pacific rim and looking at the prospects of Asia as an important business partner. When I started my career, China was really not a factor in the American entertainment industry in Hollywood at all. Things changed in the last 20 years but where they really got a jumpstart was in 2007 when the state council of China announced that over the next 10 years or so entertainment and leisure industries would go from being two and a half percent of China’s GDP to 10%. And I thought to myself wow, quadrupling share of GDP against a rising GDP, the only way they’re going to do that is by pushing all the chips on the table and telling everyone in the business in China to get moving. So I started focusing on Chinese companies and the Chinese industry, got involved in conferences and media and so forth, and over a period of a few years started getting calls and talking to more people. Initially, there was a lot more talk than action. The Chinese business community and the Hollywood business community. The … I don’t know. The business environment if you will, business cultures perhaps, just couldn’t quite get together. So there was a lot of talk and very little agreement. And then about five years ago things changed. People got more comfortable with each other. There was better understanding of the needs on both sides. I was fortunate to represent a Chinese company called Huayi Brothers in the first-ever Chinese investment in a Hollywood film slate. They did a 18 film deal with STX. And I represented Huayi Brothers in that deal.
TJ: Which was huge news at the time.
LC: That was big news. It was an incredibly exciting deal. Being a pioneer means you either find very interesting success or leave with disappointment and in this case, it was successful.
TJ: Leave learning…
LC: That’s right. You just have to take it as it comes. But that led to an introduction of Perfect World Pictures in Beijing. And I was privileged to represent them in a $500 million, 50 film, five year deal with Universal Pictures which was not only the first Chinese state investment in one of the major studio film slates but is still to this day the largest Chinese investment in a Hollywood film slate ever closed. And from there the business just grew. Not only were my existing clients active in that space but I met more companies in China that wanted assistance dealing with Hollywood or dealing with the global film industry and learning about the global film industry. And I had the privilege of representing many of them.
TJ: Yeah. You just mentioned one the aspects. Obviously, it’s two different worlds, and there’s so many differences culturally, politically, how business is done. What do you feel like are some of the learnings as you kind of danced the dance? You described this conversations and getting to know each other and feeling the other side or the other partner out. What are some of the takeaways from all these years that you’ve been doing this that Chinese people should know about when they come to the US and of course vice versa as well?
LC: Well you know I kiddingly said at one conference that part of the problem getting the two sides of the Pacific together in the entertainment industry is that China is a nation state with its way of doing business and Hollywood is a nation-state of mind with its own way of doing business and for a while you just couldn’t get the two together. That happily has changed, and people have a much greater understanding and appreciation of the other. I think for Chinese companies and individuals coming to Hollywood, one thing that they had to understand was that the legal structure really does protect people and the court system is fair, not only to Americans but to people from China and around the world, and you can rely on it to be protected in your investments and in your dealings. Folks from China needed to develop a greater appreciation of lawyers. It sounds self serving, but in China where there was not previously a very developed legal system, contracts were very short, most things were done on the basis of relationships, nobody took anybody else to court there. They were unused to a context like Hollywood where agreements were longer, spelled out terms in great detail. You could rely on the court system. And where lawyers acted not merely as the people who wrote down what the business people decided but as business guides. And Chinese clients have come to appreciate the fact that American entertainment lawyers are business guides. We do understand what the marketplace looks like. We understand what market terms are, where a deal ought to go, and where a deal could go off the tracks. And if there’s a greater sense of partnership between the client and the lawyer, the lawyers can add a lot of value on the business side as well as doing their job on the legal side.
TJ: And vice versa. When you went to China and saw things for yourself and talked to people there, what were some of the things you took away that you said oh, this will be interesting for US business people, studios, producers to know about China?
LC: Well I think we’re aware of the fact that China is a different political system than the United States. That’s not so apparent when you’re walking down a street in Beijing or Shanghai. You’d have a very pleasant experience in those cities. Dine, converse with people. In that sense, it’s not that much different from being somewhere else in the United States or in Europe. You do have to be aware that the political system is different and the government can announce a change of a program or a change of its thinking in a certain area, and unlike America where that just leads to a battle in Congress, in China it happens. So when China sets a quota on the number of western films that can come in, that’s a limit if they want to enforce it. They may decide at the end of the year if box office isn’t doing as well as they’d like to open that quota up. And it’s just a decision that the government makes. In America, it’s a negotiation as to what percentage of box office a theater owner keeps and what percent goes to the distributor like a studio. In China, it’s set by the government. For domestic Chinese films or official co-productions, the distributor keeps 42%, the theater 58%. If it’s an imported film the distributor keeps 25% and the exhibitor keeps 75%. Those numbers were changed a few years ago by the government to get to this point, and they made it a little more advantageous. But they could step in tomorrow and change it in a different direction. And that’s true of Chinese television as well. There was a time when more American shows were imported, and then the government simply announced that there was going to be a limit on how much-imported television there could be on Chinese television. Censors have to approve all the films that come in and sometimes change their minds. It’s true of Chinese television too. And I’m not just talking about what’s imported from America. It’s true of domestic Chinese content as well. There was a period two or three years ago where there were a lot of, how should I call it, romantic shows, dating shows and things like that, on Chinese television and one day the government announced that there was just too much of that and they were pulling certain shows off the air and content would be directed in a different way. You have to understand that you’re going to be going into that kind of environment and accept the fact that some things may be a certain way that is not like Hollywood or some things could change positively or negatively, and it’s not as if you’re going to have an opportunity to change it. You have to roll with it.
TJ: Do you find that, ironically maybe, this makes things a lot more efficient because not everything’s negotiable, but that’s just how it is and that makes it easier but of course more difficult to navigate at the same time?
LC: There is efficiency when you have central direction, but it comes at a price. And obviously, this is a difference between American culture and Chinese culture. There’s less creativity. Chinese filmmakers and television and other content producers are extremely creative, but they understand their creativity has to be within certain bounds. There are certain things that are just not going to be allowed by the censors. We have the freedom to make content in those areas, and it either succeeds, or it doesn’t succeed with audiences. But from a pure efficiency standpoint, that kind of central direction works. It just comes at a price.
TJ: We talked a lot about learnings from your career. One thing I’m wondering about of course is you’ve done this for such a long time. What are some of the things you would recommend or tell your 20-year-old self if you could go back and meet yourself and say listen, here’s a couple points, follow them religiously or don’t do this or this? What would that be?
LC: Well the most important one, and I say this to people at any age, is be yourself. You can develop certain aspects of your style. You can certainly learn all the time. But be yourself. Your instincts, your personality, your way of doing things are yours. And while you can emphasize your strengths and work on your weaknesses, you have to be you. If you try to be somebody else, you’re not likely to be good at that for very long. And that’s not a problem because there’s no one personality that’s right for every deal. I have a certain way that I operate. I’m very honest and straightforward. I try to create win-win relationships in deals. I try to allow the deals to establish a relationship that’s going to last for a long time rather than burning bridges or fighting so hard over every penny that people walk away and don’t want to do business with each other again. That’s my style. And my clients are here because they like that style. If you want a different style, there are others who will give that to you. And I’m not saying that my style is necessarily the best for every single deal, but I think over the range of deals that a client’s involved in in our business that that style works well. But you have to be yourself. It’s too hard to be somebody else or to try to be somebody else. You’re likely to trip yourself up and not take advantage of your own strengths. The other thing I would tell younger people coming into the industry is that there are some things that just come with experience. And they shouldn’t get frustrated if they don’t know everything right away. There’s no way you can swallow a pill and know what someone who’s been in the business 10, 20, 30 years knows. It’s just impossible. Don’t get frustrated. Learn as quickly as you can. Read, study, work with people who have been in the business a long time, and just know that you’re going to develop over time too just like they did.
TJ: I think that’s such an important message and I think you put it so beautifully because obviously this world wants you to be so many things and just the message of saying just do you, focus on that, I think is so valuable because especially when you’re working in larger organization there’s so many things you have to comply with but to find your way of how you can do both, be you and reach the goals that you set out, I think is so important. You mentioned people coming into the industry, for example, a young lawyer. When you got started if that hadn’t been an option if someone had said “No Lindsay. Sorry. Entertainment law, can’t do it.” What else would you be doing if you couldn’t have done it?
LC: Well I like to build. I like to create. I like to bring people together. So I suspect if entertainment law as a category hadn’t been available, I would have gone into some other area of transactional law. Entertainment law to me is just more fun. And it’s a fun industry to be in. But I would have probably been a lawyer in another area of transactional law trying to create businesses or improve businesses, enhance businesses.
TJ: So for someone that’s coming in now or knowing what you now know, how would you have done things differently for example? Or how would you recommend them to approach the industry that’s changing? Is there something that you observed where you go huh, this is very different from … Young associates for example that are coming into the firm right now as opposed to when you were younger and came into the company. That there’s different priorities, you have to set.
LC: The technology has changed, and you have to be adept at technology, but that’s not a problem for young lawyers. They are growing up in those technological worlds in college and in law school. So that is a change, but it doesn’t disadvantage the young lawyers at all. I don’t think there is a real difference in the sense of you need to learn about the industry, about the norms of the industry, about legal issues in the industry. But that’s always been true. I had to do that when I first came out too. If there’s a greater challenge now, it’s just that we are bombarded by so much information, so many places to go and get news. There’s just a lot more to know in a sense. But the basic task of learning about the business so that you can advise clients what’s smart, where the market is, what they ought to do in order to achieve their business objectives, that really hasn’t changed.
TJ: Interesting. Because when I started to develop an interest for the industry and started learning about it and reading books, something I always found very difficult to get was information, especially from books, that’s accurate. And the book was written three years ago, and you read it, and you go oh okay, so this is how it is, and you talk to someone who’s actually doing it, and they’re like “No, no. This is what we did three or four years ago.” And you’re like oh. How do I stay up to date? Do you have any observations or things you can share of kind of what is a good way to learn about this industry?
LC: Jump in and work with people who know what they’re doing. There are a couple of law schools that teach entertainment law courses. Mostly they’re in the Los Angeles area.
“The other thing I would tell younger people coming into the industry is that there are some things that just come with experience. And they shouldn’t get frustrated if they don’t know everything right away. There’s no way you can swallow a pill and know what someone who’s been in the business 10, 20, 30 years knows. It’s just impossible. Don’t get frustrated. Learn as quickly as you can. Read, study, work with people who have been in the business a long time, and just know that you’re going to develop over time too just like they did.”
TJ: I was about to say move to Los Angeles.
LC: Yeah, it’s a company town. There are some entertainment law courses elsewhere. But there’s only a limited amount you can learn about the business reading out of a book or studying old contracts because the business changes so quickly. You can get a grounding in the areas of law that are most central to entertainment, which are really the law of contract and copyright law. And that’s certainly a good place to start. But that gives you legal structures. That doesn’t teach you about the business of the industry, it doesn’t teach you what the norms are, it doesn’t teach you the lingo of the business. That you really have to get in and apprentice if you will. We don’t call it apprenticeship, but that’s what being an associate is. You have to learn from the people who are doing it, and over a period of time you do pick up the language and the norms and the market knowledge so that you’re in a position to advise clients intelligently as well.
TJ: Speaking of people who know what they’re doing, I had a look at your list of things you worked on, and I mean there’s very few transactions and deals on there that aren’t gigantic. So one of half a billion dollars, billion dollar-
LC: But that’s not day to day. I have done deals in that range, but I also do plenty of deals in a middle range and even smaller deals. The big ones attract a lot of media attention.
TJ: Yeah, for sure.
LC: But clients come in all shapes and sizes. Yes, I do represent major studios and networks, major telecommunications companies, banks and major financial institutions, and major production and distribution companies, but I also represent people in smaller production and distribution companies including some individual producers who are trying to get a project made. So there’s quite a range of projects that I work on on a daily basis.
TJ: Yeah. So one of the things I was wondering when we were talking about the deal size and size of organization. Is there a fundamental difference between all these deals or is it just you add a zero on some deals and others are … You know, is basically the setup or the anatomy of the agreements the same?
LC: The basic principles are the same. As a deal grows larger clients want more and more protection and as deals are smaller clients may say “You know what, I just can’t afford to tease out every possibility here.” So you have to be practical. You have to understand what the client wants, and you have to be, as I said, a partner in effect with the client in figuring out the level of complexity that makes sense for a deal, the level of protection, and the degree to which things are going to be negotiated. Some things just don’t deserve 10 weeks of negotiation. Some things do. And you have to be able to make that kind of distinction and advise clients in that area. But the basic principles are the same. And the one underlying principle for me that’s always the same is I always want to do a great job for the client. I never approach anything big or small and say “Oh, this isn’t that important.” If it’s important to the client, it’s important to me. The deal is what matters. And this, by the way, is something that varies from lawyer to lawyer in Hollywood. I’m one of those lawyers who believes that I am not more important than the deal. The deal is what’s important. It’s sometimes troubling when you do run into lawyers who think they’re more important than the deal or who inject their ego into it. I don’t inject my ego into the deal. The client and I are there to make the best possible deal for the client and establish a relationship that’s going to work and be successful over a period of time. And whatever it takes to get that done is what we need to do, but it’s not about me. It’s never about me. It’s always about the client.
TJ: Speaking of working with you, when someone’s listening to this now and says hey, I want to work with Lindsay or Manatt, are there prerequisites to work with you? What type of question, transaction, or deal should someone come to you with?
LC: I wouldn’t say there’s a prerequisite other than the fact that what can I say, this is a business and clients do pay fees and we are not the most expensive firm in the business, but we’re not the least expensive either. So clients have to understand if they’re going to come to a place like Manatt they’re going to get top of the line legal service, but they’re also going to be paying for that service. But beyond the ability to pay for the services there’s no real qualifier. As long as I think somebody’s a good person or a good company to work with, I’m happy to work with them. Whether they are in the United States or abroad. I have clients, not only in China and elsewhere in Asia, but in Europe and in Latin America. And regardless of the size of the clients. It may be a very big company, or it may be one individual. By the way, the one individual might be a producer trying to get a film made, but it might be a high net worth individual who wants to put money into the entertainment industry. Wants to get involved in the business in some way. So clients come in all nationalities and shapes and sizes and aspects of the business, and we’re happy to take them on.
TJ: Perfect. I think that’s a wonderful place to wrap it up. Thank you so much for making the time. A pleasure speaking with you.
LC: Oh my pleasure Toby. I’m really glad we had this opportunity.
TJ: Perfect. And I’m sure we will do it again sometime soon.
LC: Sounds great.
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ABOUT MEDIA CFO
Media CFO focuses on the finance, strategy, business affairs, and legal side of the global media & entertainment industry. The guests on the podcast range from veteran studio executives to new, disruptive market entrants. MEDIA CFO takes a look under the hood of the global entertainment industry and talks to the unsung heroes: dealmakers, lawyers, entrepreneurs, financiers, service providers, bankers, investors, and agents. The podcast offers unique insights into the daily work and life of those, who run and build this industry by visiting them on location and having in-depth, in-person conversations.
ABOUT TOBIAS JAEGER
Tobias started his first own firm during his studies at Maastricht University in the Netherlands and has lived, worked, visited, and studied in over 43 countries on 4 continents. Tobias loves to connect people from around the World to make great things happen. Previously, he has done so at Business Associates Europe, SAP AG, StrategosPoker, Aramark, and entrepreneur academy. Today he is a Managing Partner of AXIOM Venture Capital, a family office focussed on the media & entertainment industry and Tobias serves as the Chief Financial Officer of London-based television and content studio Colibri Studios.
The conversation was originally recorded in Los Angeles in March 2019.
© 2019, Colibri Studios of London