With his bro leaving the White House and rival CAA getting a $365 million cash infusion, the power broker's having a rough couple of weeks
In the space of two short weeks, Hollywood power broker Ari Emanuel has suffered a double blow to his power base, neither of his making.
The decision by brother Rahm to step down as White House chief of staff and run for mayor of Chicago (why is this a job anyone wants?) pulls the rug out from under the uber-agent’s ability to tout his access at the apex of government.
This is not a small thing. In a world where power is a relentless shape-shifter and information is the underpinning of power, it was mightily handy to have a sibling whose job it was to whisper (or yell expletives, whatever) in the ear of the president, the calling card to trump all others.
It was a subtle but huge advantage in a world where influence is all.
Last October at a USC Law School panel, Emanuel managed to instantly shrink his fellow panelists Jeff Berg of ICM, Jim Berkus of UTA and David O’Connor of CAA with three simple words: “My brother says … ” he began.
Emanuel went on to explain how “my brother” had told him about Obama’s plans to extend broadband across the country, and that Hollywood needed to be vigilant against the heightened threat that piracy represented to the industry.
It was potent and dropped effectively in an ohbytheway manner. I am told it instantly underscored Emanuel’s new status on the heels of the WME "merger."
All that is behind Ari as the landscape changes. I tend to doubt that he will find it as effective to name-drop with Rahm moving back to Chicago.
What’s the other blow? CAA’s new investment with TPG taking a 35 percent minority stake, and the launching of a $500 million media fund alongside it.
This means WME’s main and larger rival just got more formidable with an infusion of hundreds of millions in new capital. (Reports seem to reliably put the investment at $165 million cash plus $200 million in debt financing.)
It gives CAA the ability to expand into new arenas, to more decisively fund its new interest in the sports game and to solidify its dominance of the talent game.
WME has its own "preferred relationship" at a newly created $300 million media fund put together by boutique investment group Raine, run by Joe Ravitch and Jeff Sine.
This could be an interesting new avenue, but it’s impossible to say from this vantage point. Lots and lots of media funds get announced. The question for TPG/CAA and Raine/WME will be: What investments actually get made, and how do they perform?
Said one knowledgeable observer: “With the investment at CAA, the question is, is it really a meaningful two-player game?”
Emanuel's karma could use some help. Even Ari Gold got dumped by his wife on "Entourage."