Operating Like a Hollywood Agent

Information is Power

Michael Ovitz ruthlessly built the a Hollywood agency that revolutionized the movie business and then he helped create some of the biggest tech VCs. This interview of Ovitz is wonderfully entertaining. It’s full of showbiz stories but also concise lessons of how Ovitz operated and won in an extremely competitive environment.

Ovitz states that “information is power” several times and goes into detail about how he used that insight to build a huge amount of power:

• For 30 years he (and all of the agents at the firm) made 250 phone calls a day

• The firm’s strict rule was that you could play people outside of the firm but you could not play people inside of the firm: “you did your fighting outside the firm, not inside.”

• Each morning, before the rest of Hollywood woke up, the whole firm would have breakfast together and each person would share all the new information they’d found out the previous day

He describes how this information sharing compounds:

We had a partnership and we had 150 agents. And you have to realize what that did. You had 150 agents in all different fields, at one point two hundred, going out, covering the communities between New York and L.A. in all creative areas, everything. Taking that information, reporting it back into a meeting every single day, sharing it unfiltered, no cards held close to the vest and then doing 200 to 300 calls a day.

And it builds on itself to the 100th power. So if we had 200 agents, it builds to the 200th power and one can't compete with that. It's not an accident that we ended up with the best client list or the most film packages or most musical tours or most books on the New York Times bestseller list each week. It fed on itself.

I love the simplicity and the power of this idea. Every company has some method of internal knowledge sharing and everyone recognizes that it is valuable but I have never seen a company commit to it to this degree.

At a much more modest scale, I’ve seen the benefit of reading lots of things related to my company and industry, even though they are not directly a part of my job. This type of information is powerful, it gives you a critical perspective for the things you work on and helps you relate to people in different roles or at different companies.

I also have friends who are very good at gathering knowledge about what is happening internally at their organizations by talking to lots of people about intra-company moves. I’m not as good at this but it also seems quite powerful, to know the relationships of people and to know all of the projects going on in a company.

If you’re interested in Ovitz or Hollywood, his book Who is Michael Ovitz? is among my favorite books about business. He’s a fascinating character.