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More Talent Agent VCs: William Morris to partner with Accel

WMA venture fundHollywood studios fight and follow each other in the search for their next blockbuster movies so it probably  should come as no surprise that the same “follow the leader”  “anything you can do I can do better,” mentality applies to the talent agencies representing  those in  the films.  And that’s exactly what’s happening.   Like one shotgun wedding after another, or the line waiting outside the Elvis Wedding chapel in Vegas, pairs keep forming between venture capitalists and talent managers.

The first high profile attachment was in early December.   Then, with venture capital investments at a six month high, Creative Artists Agency joined hands with Draper Fisher Jurvetson and partners from Palomar Ventures to establish a venture fund of their own.  Details were short, largely due to securities law required quiet periods, but the estimate, was that the fund, which was still being raised,  was in the ballpark of $200m. All of it earmarked for digital entertainment investments. 

Even with Silicon Valley and the Hollywood sometimes at odds with each other in battles of so called old media versus new, content being king, and the media worlds converging, makes the pairing seem a natural fit.   Both VCs and the Agencies live by looking to the future.  Both take risks.  Both focus on discovering what’s next and, especially, both rely heavily on substantial contact networks to advance their projects.  

So now, William Morris is the second major agency to formally get into the act with a Silicon Valley partner.  Announced today, they have revealed an agreement to jointly establish a small venture fund that will be  co-managed with assistance from top tier funds Accel Partners and Venrock, along with AT&T.    (William Morris has previously made some investments in startups on their own.)

This new fund was reportedly initiated at the urgings of William Morris CEO James Wiatt and Paul Bricault who runs their consulting practice.   Unlike the CAA fund, it will be small; more of an experiment than a bold step. The capitalization is expected to be in the range of $25 to $50m.  Investments are speculated to be no more than $2m at a time, and possibly as low as $250k.

AT&Ts involvement suggests there will be an emphasis on mobile content but reports are that’s exaggerated. The fund is intended to be broad in its focus and will likely look to WMA focus areas in music and video entertainment.   Mobile entertainment will be just a small part.  AT&T as a limited partner in the fund can choose which companies it wants to invest in.

Managerially, Richard Wolpert will lead  the fund.  He was formerly president of Disney Online and chief strategy officer at RealNetworks.  An executive committee staffed with reps from William Morris, the VC partners will oversee executive management.  A separate investment committee, as typical of most venture funds, will collectively approve or reject proposed investments.

Consequence of the news, there’s some probability that similar partnership announcements could trickle out from other agencies over the course of the next year.   Endeavor and International Creative Management (ICM) have both reportedly been interested in building technology and investment relationships. In fact, ICM’s CEO, Jeff Berg, has been on Oracle’s board of directors for a decade and has been reported on more than one occasion to have sought guidance from established technology executives about increasing his firms involvement in media convergence.

United Talent Agency (UTA) has already taken a different route.  Instead of looking to become an investment partnership, they’ve sought to incubate or partner directly with young companies.  They first got involved with startup advertising agency Spot Runner.  Then they helped incubate TV firm 60 frames entertainment.

The new William Morris fund is likely to remain almost exclusively focused on southern California and entertainment industry related projects.

Paul Bricault, senior vice president and head of William Morris Consulting said, “We’re focusing on Southern California because we truly believe there’s a sense of reality here about the intersection of media and entertainment and technology,” adding, "it is producing real results."


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