I’m back. Sorry I’ve been absent so long. Pay-the-bills-work on tight deadlines, plus a protracted case of the flu interfered with my best laid plans.
Cory Doctorow
Cory Doctorow describes himself as a science fiction writer and a technology activist. A science fiction writer, says he, “envisions the future” and a technology activist strives to “change the future.”
Not all science fiction is future-oriented, but most is, I’d say. Anyway….
Wikipedia says that Cory Doctorow’s parents were “Trotskyist teachers” and that he grew up in a Jewish activist household. Jewish activists, also referred to as the Jewish left, are supportive of left-wing, generally liberal causes and policies.
Yesterday, I took issue with Cory Doctorow’s “dandelion” theory. Cory says: “Dandelions and artists have a lot in common in the age of the Internet.” He believes that spreading your digital content for free across the Internet like zillions of dandelion seeds scattered by the winds helps sales of physical products. It seems to work for him. However, I said: “Now, about how Cory’s marketing advice applies to most creative people and the comic book business—it doesn’t. Or I don’t see how. Maybe he’ll set me straight….”
Maybe he already has.
Check out these passages from his book CONTENT – Selected Essays on Technology, Creativity, Copyright and the Future of the Future:
Cory Doctorow opposes technology that limits what one can do with digital content and laws that criminalize people for alleged copyright infringements that he believes are harmless, or even beneficial. I think that’s an accurate assessment. If not, I hope Cory will correct me.
In any case, don’t take my word for it. Check out his position statements for yourself. They’re entertaining reads. The guy writes like the Silver Surfer surfs. Here are the links again:
Cory Doctorow sent me a couple of nice e-mails recently. He said he liked the last three posts, which discussed issues he raised about copyright, DRM and SOPA.You probably noticed from the dates on Cory’s articles and essays I cited (if you followed the links) that some were written a while ago. Cory said that he’s currently working on an updated, comprehensive book on the “big, synthesized whole” of intellectual property in the digital age. He sent me a sneak peek at the work in progress and gloriosky, it’s great. It’s not just for people in the biz or those fascinated by legal issues. Draconian digital copyright protection measures currently in use or being contemplated can affect ordinary, innocuous communications and be used in nefarious—make that really evilways—that never occurred to me. Some of the things Cory brings to light are deeply disturbing.
Note from JayJay: In the late 90s Jim got a book deal from a major NY publishing house to write a book on the comic book business. This is the book proposal that got him the deal. Unfortunately, the project proved too research intensive to do alone and he was unable to finish it. But this is a fascinating overview by a uniquely positioned insider of a point in time when the future of comics was seriously in question.
$UPER VILLAINS: The Decline and Fall of the Comic Book Industry
A Mafioso loan shark who also happens to be an artist is inking a Superman page when an FBI organized crime sweep picks him up. A four-hundred-fifty pound publisher of soft-core porn comics, heartbroken over being ousted from the company he founded, rolls himself over the railing of the forty-fifth floor landing of the Marriott Marquis Times Square Atrium and craters in the elevator lobby below. A young cartoonist decides to get in the mood to draw his creature-of-the-night strip by prowling over the rooftops of Hellʼs Kitchen at midnight, leaping from building to building.
The comic book industry is chock full of colorful characters on and off the pages. The real-life characters are the most creative, and possibly the most dysfunctional group ever assembled. The comics industry has always been a tiny sideshow just off the entertainment midway, a bizarre little freak show of the nerds, by the nerds and for the nerds. Always brilliant, yet pathetic, wonderful, yet wretched, it has bumbled its way along since the early part of the century—a medium that has nonetheless created powerful ideas and timeless icons.
Meanwhile…
In their marbled lairs and Wall Street aeries, financial predators caught the scent of opportunity. Men like Mario Gabelli, Ronald O. Perelman, Herbert Allen and Carl Icahn have swooped to attack this plump, defenseless little business. Through evil machinations, they inflated its perceived worth until Marvel Comics alone had a market capitalization of nearly three billion dollars…
But, Marvel was a hollow giant. Moves made to provide short-term growth damaged its markets, drove away talent and cut out the companyʼs creative heart. Marvel was reminiscent of a rotting whaleʼs corpse—impressively big, but bloated by the gasses of its internal decay.
Other comics companies werenʼt spared. All across the industry, short-sighted greed and pillaging by Super Villains wreaked havoc. Collapse was inevitable.
In mid-1993 the comic book industry implosion began. Itʼs still going on. The once-thriving comics business is all but dead, now, its value strip mined away. Most of the Super Villains escaped, as free as O.J. Itʼs no wonder that during these last two decades, the comics themselves have become darker and grimmer. Super heroes are a futile and bitter lot these days, always failing, losing and impotently swearing vengeance.
Iʼve spent the last twenty years straddling the great divide between the business side and the creative side of the comic book industry. Iʼve been a writer, an editor, an executive and an owner—sometimes all at once. Iʼm intimately familiar with the rank and file employees and creators, to whom the Super Villains might as well be dark gods, beings beyond their ken at whose whim they suffer. Iʼve also had many direct dealings with the Super Villains. Iʼve fought against them in the boardroom and in the court room. Iʼve bid against them in the 1988 auction of Marvel Comics. Iʼm not a stranger in their world. I saw the fall of the industry from both sides.
$uper Villains, The Decline and Fall of the Comic Book Industry begins with a short overview of the tortured history of a schlocky little business that set out to be a shortterm fad but decades later was stunned to find itself still alive, surviving paper shortages, a Senate investigation and a slow erosion of sales to disastrously low levels.
Then, it tells the tale of the turnaround and rise to prosperity, which attracted the attention of the Super Villains, the resulting years of turmoil and meteoric crash, as I saw it from my unusual vantage point. Since much of my time was spent among the comic book ground troops during that time, my view of the ravaging of the industry necessarily includes up-close, behind the scenes stories about the weirdest people on the planet.
Events like The Coronation of the Tater Queen and The Great Marvel Whack-off Contest come to mind…
$uper Villains also necessarily includes some of my own story, beginning with becoming the youngest professional comics writer ever at age thirteen, working my way up through the ranks from associate editor to editor in chief and vice president, and finding myself, ultimately, battling Ronald O. Perelman and his ilk for control of Marvel. I was profoundly naive about business and finance when I arrived for my first day of work at Marvel, fresh off the plane from Pittsburgh, Pennsylvania with my suitcase in my hand, fifteen bucks in my pocket and no idea where I was going to sleep that night. As the crisis in the comics kingdom evolved, and as I moved up the ladder, I had to learn about what was happening because I couldnʼt learn to bury my head in the sand. I suppose itʼs because I read too many Spider-Man comics when I was a kid. As he would say, “With great power comes great responsibility.” To the Super Villains, the comic book business in general and Marvel in particular represented the opportunity to make a play with reckless disregard for long-term consequences, but to the people I worked with every day, it was their livelihoods, their careers, and often, in a somewhat pathetic way, their lives. When I saw evil threatening, I felt like I had to do something about it. If only Iʼd been able to duck into a phone booth, change into my costume and punch out the bad guysʼ lamps to solve the problem…
What I did do was possibly just as ridiculous, often foolish, sometimes funny and ultimately unsuccessful. I used whatever clout I had inside Marvel to resist the machinations of the predators, and got fired, I raised money to bid for Marvel, and lost, I started my own company, and had it stolen out from under me by Super Villains.
But, I made a valiant effort. Iʼd like to think Spider-Man would be proud of me. The experience has given me an incredible story to tell. And, the fact is, itʼs not quite over yet.
Bankrupt, in the hands of a Trustee, Marvel Comics is for sale again…
Hmm.
Wouldnʼt it be a proper comic book ending if the good guys could ride to the rescue at the darkest hour?
The Author
No one else could possibly write this book. My experiences with the corporate raiders and financial predators who came to plunder Marvel and other comic book companies, combined with my extensive background in the comic book business, give me a unique perspective. No one else has written Spider-Man stories for Marvel and also bid against Ronald O. Perelman in an attempt to buy the company.
In 1965, at age thirteen—a world record—I began writing Superman and other comics for National Periodical Publications, Inc., publishers of DC Comics. I worked with longtime chief editor Mort Weisinger, who taught me a great deal about creating comics, and the business of comics as well. Later, I also worked closely with and learned much from Stan Lee, one of the founders of Marvel Comics.
In 1978, when I became editor in chief of Marvel Comics, the comic book industry was in steep decline. Over the course of several years, we turned it around, and Marvel emerged as the dominant leader of a revitalized industry. Our new, booming success was well publicized. We might as well have chummed the waters of Wall Street.
During 1983, corporate raider Mario Gabelli began and attempt to takeover Cadence Industries, Inc., Marvelʼs parent company. After a long, bitter struggle, from which Gabelli emerged significantly richer, Cadence was taken private by chairman Shelly Feinberg and the board of directors. Soon thereafter, a number of attempts were made to sell crown-jewel Marvel. Viacom, Western Publishing, under Richard Bernstein, and several other potential buyers backed away, but finally New World Pictures bought Marvel in late 1986.
While Marvel was on the block, the previous owners were stunningly short-sighted, even self-destructively so at times, but shortly after the new owners took over, I realized that they were intent on setting a New World record for myopia. Disgusted, I left Marvel in Spring of 1987. New World, so ineptly run by Larry Kuppin, Harry Sloan and Bob Rehme that, at one point, it was losing over a million dollars a day, was forced to sell Marvel at auction in 1988.
Having had an education in the buying and selling of companies forced on me during my time at Marvel, with the help of Chase, N.A., I raised money and entered a bid of $81 million. However, through his Andrews Group, Ronald O. Perelman (who was an insider at New World, by the way) narrowly outbid me and wound up with Marvel. I wound up with another education.
Since then, Iʼve started three comic book companies, only to discover that financial predators by no means confine themselves to big targets like Marvel. The parade of people Iʼve dealt with—and sometimes struggled against—includes Herbert Allen, Enrique Senior, Victor Kaufman, Lew Korman, Michael Ovitz, Wayne Huyzienga, Charles Lazarus, Tom Riefenheiser, Gordon Rich, Michael Lynn, Bob Shea, Michael Lynton, Bill Bevins, Dick Snyder and Lorne Michaels. Iʼve been the subject of a feature article in Forbes Magazine (June 12, 1993), which recounted one of my battles involving Allen and Company, and Iʼve often been interviewed by and quoted on the subject of the comics industry in The Wall street Journal, The New York times, Crainʼs and many other well-known publications.
All through this, Iʼve kept an eye on Marvel. Thanks to the many contacts Iʼve accumulated along the way, both in the comics business and in the financial world, Iʼve had a ringside seat for the struggle between Ronald Perelman, Carl Icahn and others over the remains of Marvel, which entered Chapter 11 bankruptcy on December 28, 1996. Marvel was the leader of what was once a billion dollar a year industry. Unfortunately, the industry is so dependent upon Marvel to attract customers into stores, inspire interest, and serve as the economic bedrock of the business that, as Marvel has dwindled and weakened, the entire industry has crumbled. Greed, inept management and callous disregard are destroying an industry, the lives of people who depend upon it, and an artform.
Friends of mine in the comic book business have often asked me to write this book. No one else could—and itʼs a story that ought to be told.
Table of Contents
Introduction: “This Man, This Monster”
Super Villains fight dirty. Theyʼll slime you.
Chapter One: “Days of Future Past”
The tawdry, tacky, lightly checkered history of the only other American artform besides Jazz, the future we had and how we blew it.
Chapter Two: “What Price Power?”
Cadence Industriesʼ boardʼs epic and expensive struggle against Mario Gabelli, culminating in the boardʼs taking the company private.
Chapter Three: “New World Aʼborninʼ”
New World Picturesʼ junk-bond financed purchase of Marvel Comics, and subsequent plunge into the abyss.
Chapter Four: “If This Be My Destiny”
My attempt to buy Marvel and deliver it from the clutches of the Philistines.
Chapter Five: “The Perelman Cometh”
The Ronald O. Perelman era at Marvel, during which the company was inflated, much like the Hindenberg.
Chapter Six: “Turning Point”
My attempts to buy Harvey Comics, create a comics publishing division for Disney, and start up a comics company, leading to the launch of VALIANT, which became a huge success.
Chapter Seven: “By a Friend…Betrayed!”
The scheme involving my partner, his bedmate, who was a principal of the venture capital company that funded us, her brother and others from Allen and Company by which I was ousted from VALIANT. VALIANT was then sold for $65 million. Machiavelli himself would have blushed.
Chapter Eight: “Man on a Rampage”
My start-up of another company, DEFIANT. DEFIANT ended in disaster as Marvel began to collapse, the market began to contract and deals with Savoy Pictures and New Line Pictures failed to close in time to save us.
Chapter Nine: “The Web of the Snyder” (or “Along Came a Snyder”)
My start-up of Broadway Comics in partnership with Lorne Michaelsʼ Broadway Video Entertainment. We were sold to Golden Books Family Entertainment and subsequently “Dicked.”
Chapter Ten: “When Titans Clash”
Carl Icahn and Ronald Perelmanʼs war over the right to pick the corpse of Marvel.
After a year in bankruptcy, the judge finally appointed a trustee. Breaking up is so very hard to do.
Epilogue: “The Final Chapter?”
Is it over for the comics industry? Or is it possible that, like a Phoenix from the ashes it will rise again?
Chapter Overviews (Part 1)
Introduction: “This Man, This Monster”
The introduction to Super Villains illustrates the nature of the game Super Villains play, and itʼs not just buy low sell high. Itʼs a cowboy business—there are few rules on the range. A would-be buyer of a company who spends hundreds of thousands of dollars on due diligence, only to discover that the auction was rigged by a Super Villain insider shrugs it off like a fisherman whoʼs lost his bait. There is no cost-effective legal recourse—better to move on to the next deal. Cheaters prosper. “Business ethics” is an oxymoron. Board members operate in their own interests—screw the stockholders.
Down the line in management, executives are expected to help the Super Villains strip mine the company and are rewarded for doing so. One key thing required of them is lying to the employees: “We want them to think this so letʼs tell them that.” Spin control to keep the troops marching is essential. They may be marching right into the whirling blades, but so what? Nothing personal. Itʼs just business.
Donʼt misunderstand. Super Villains is no paean to blue collar honesty or the heroic worker. Employees and creators in the comic book business have routinely been sucked in by the manipulations of their exploiters because of their own greed. An amazingly small bonus and the promise of future success under a new regime is often all it takes to secure gung-ho support form the employees. Itʼs all part of creating the illusion of value which is, in fact, what Super Villains cash in on.
If you stand in their way or oppose them you find out very quickly that Super Villains fight dirty. They have money, power, influence, clever lawyers and good PR people.
They can hurt you in many ways.
In the course of my battles against them, theyʼve threatened me, harassed me, fired me, had me spied upon, had me followed by private investigators, had my office ransacked and my files stolen. Theyʼve sued me spuriously several times, and, though Iʼve always defended myself successfully, the cost in time and resources has been crippling—which was the point, of course. Worst of all, theyʼve spared no effort to destroy my reputation.
In the comic books, super villains typically cackle, rub their hands gleefully and boast about their wickedness. Real world Super Villains, however, always claim the moral high ground. Some of the really twisted ones even believe that they hold it. They present themselves to the employees of target companies as good guys, even saviors. At the same time they demonize whoever opposes them.
Me, for instance. Iʼve been slimed—and itʼs made life difficult.
For example, in 1989, after being outbid for Marvel by Perelman—who was an insider at New World Entertainment, the seller—I needed a job. I thought Iʼd found one until Michael Lynton, then marketing VP of The Walt Disney Company, reneged on his promise to install me as head of the new comic book publishing division they were forming. The reason, he said, was that theyʼd done their usual background checking and had been informed by a number of sources that I was literally a monster. It had been said that while I was editor in chief of Marvel Iʼd been a megalomaniacal, raving tyrant that no one who knew me or knew of me—in other words, no one in the comic book business—would ever work for. Disney Comics would be boycotted if I worked there. I was a pariah.
The information, Lynton said, flew in the face of his own experience with me. Iʼd been working with him for six months as a consultant, helping to develop the business plan and creative strategy. Weʼd gotten along fine. He said heʼd found me eminently reasonable, level-headed and easy to work with. Maybe, he said, Iʼd reformed since my Marvel days…
I tried to explain how the several Super Villains Iʼd vied against over Marvel had rewarded anyone who denounced me, punished anyone who sided with me, generally vilified me and blamed me for everything except the Challenger disaster.
Lynton was sympathetic, but said that Disney couldnʼt take a chance on me.
As it turned out, no one would. I ended up starting my own company and creating a job for myself. Disney, meanwhile, hired someone else.
A year later, Michael Lynton called and apologized. As heʼd gotten more involved in the comic book business and learned more about what had happened at Marvel, he realized that what Iʼd told him was true. He said he sincerely regretted not hiring me, a vindication which meant a great deal to me.
Later, Michael Lynton personally invested in one of my start-ups and even served on the board. He is currently CEO and president of Viking Penguin, and we remain friendly.
Thatʼs generally how it works. They smear you wholesale. You have to prove them wrong one person at a time.
If the idea of people falling for such a transparent smear campaign seems fantastic to you, you donʼt understand the stunning naiveté of the comic book community, professionals and fans alike. It was easy for the Super Villains to make comic book people, who after all love super heroes and super villains to believe that Iʼm Doctor Doom.
To this day, it is commonly held that anyone who had a dispute with Marvel during my tenure there was actually having a problem with me personally. A beloved artist having a dispute with Marvel over the return of his originals became “Jim Shooter wonʼt give Jack Kirby his artwork back.” A small publisher alleging unfair trade practices became “Jim Shooter flooded the market to drive First Comics out of business.” A film deal falling through became “Jim Shooter ruined the Laurel Entertainment deal.”
They even managed to reverse good parts of my reputation. For instance, while Iʼm the one who installed virtually every benefit and incentive program for artists that Marvel has, it is now a generally considered fact that I was the Great Enemy of creatorsʼ rights while at Marvel.
Once Iʼd been slimed, it got easier and easier for Super Villains to slime me again. My legend still grows. The kindest mentions in business and trade media call me “controversial.” Every business transaction I undertake begins with trying to convince investors, partners or employers that Iʼm not so bad. One potential investor, Centre Partners, demanded, and I provided, one hundred references from reputable people in the trade refuting my alleged monster-hood. Others simply werenʼt interested in getting involved with someone so “controversial” no matter how many hoops I jumped through.
Nonetheless, Iʼve managed to survive and, periodically, in my Grandma Elsieʼs words, “rise up and strive again.” Iʼm not through fighting the Super Villains yet, but I think itʼs time to tell the story so far. They may not like it, but so what? Nothing personal. Itʼs just the truth.
Note from JayJay: Part 2 of a book proposal Jim wrote.
Chapter One: “Days of Future Past”
People have been using sequences of pictures in combination with written or spoken words to tell stories since Paleolithic painters chronicled hunting expeditions on cave wall. It wasnʼt until the late nineteenth century, however, that the medium of comics began to develop in earnest, when American newspapers and magazines started carrying single panel cartoons and comic strips.
The first comics were drawn from one fixed point of view, as if the scenes shown were taking place on a stage, and the readers were seeing them from an orchestra seat. Cartoonists soon realized, though, that angles could be varied, close ups could be used to convey emotion, medium-depth shots to show action and long shots to introduce locales.
Thus, the choice of shots and the sequence of shots could relieve the words of much of the burden of exposition. The result was the evolution of an entirely new way of conveying ideas—a fusion of word-bites with information-rich images to form highcontent, easily assimilated info-packets that could be presented alone or in a sequential stream.
Comics quickly gained acceptance as a legitimate medium all around the world—except in the United States. Elsewhere, the comics medium is used to convey entertainment and information of all kinds to all ages. Here, in its birthplace, the comics medium has been stigmatized as a rather lowbrow amusement for children thatʼs probably bad for them. Comic books, especially, have always suffered from, and largely lived up to their reputation as junk for kids (and somewhat pathetic adults).
The first American comic books, published in the 1920ʼs, were reprints of newspaper strips, often use as giveaway premiums by soap companies and movie houses. Comic books were generally published by small, fast-buck publishers who thought they were cashing in on a fad. When, in the mid-1930ʼs, comic booksʼ popularity had failed to fade, some publishers began publishing original material—but kept their schlock mentality.
In his book The Great Comic Book Heroes, Jules Feiffer, who like many talented people started out in the comic book business, tells of virtual sweatshop conditions—of comic book creators working in cramped bullpens, sleeping on the floor, living on cigarettes and coffee and cranking out pages. Often, two artists would work on the same page at once, one drawing upside down. Writers churned out scripts page by page as the artists were drawing them. Creators often used pseudonyms to avoid having their real names sullied by association with comic books. For instance, Stan Lee, the creative force behind Marvel Comics, was born Stanley Leiber, a name he hoped to save for when he wrote the Great American Novel, or for when he broke into writing newspaper comics, which, by comparison, were respectable.
Artists and writers often had to hound publishers for payment. Many publishers simply flew by night.
The tawdry history of the business, rife with low self-esteem, greed and cheesiness, set the stage for disaster. Somehow, though, comic books survived wartime paper shortages, investigation by the U.S. Senate Subcommittee on Juvenile Delinquency, and a steep decline in available retail outlets. Not only did the business stubbornly refuse to die—a testament to the innate vitality of the medium—but three times in my lifetime it enjoyed tremendous boom periods and nearly established itself as a major, mainstream, legitimate medium.
That may be hard to imagine for many people—but consider that Japan, with one third the population of the U.S., buys three times as many comic books at price points that are relatively higher. There are Japanese comics devoted to such diverse things as romance, knitting and tennis. There are cute “funny animal” comics for young children and pornographic comics for adults—often bound together in the same volume, oddly enough.
Success isnʼt limited to Japan. Scandinavia has the highest per capita consumption of comics in the world, and throughout Europe, the variety of comics, and the respect given comics as a medium is amazing.
Chapter One will briefly explain the history of comic books in America—how they earned their status as third class citizens of the arts, how the industry self-destructively avoided big-time success and how it became ideal prey for financial predators and Super Villains.
Itʼs a litany of short-sightedness, stupidity and greed, leading to the near- moribund state of the business now. Itʼs tragic, really. We couldʼa been a contenda.
Chapter Two: “What Price Power”
In 1983, corporate raider Mario Gabelli began buying up shares of Cadence Industries, Inc., setting off a bitterly contested battle for control against chairman Shelly Feinberg and the board of directors. The real prize was Marvel Comics, a division of Cadence. Shelly and his henchweasels had made Marvel a division, rather than a subsidiary, like every other Cadence unit, so that Marvelʼs earnings could be buried under Cadenceʼs bloated corporate overhead. With the crown jewel carefully hidden, Shelly planned to deliberately depress the stock/price, take Cadence private for a relative pittance, then sell off the pieces—especially Marvel—at their true worth. Gabelli, however, had seen through Shellyʼs scheme and was trying to usurp it.
Chapter two tells the tale of Marvelʼs rise from the brink of oblivion in the late 1970ʼs to prosperity in the 80ʼs, and of the Super Villain war it touched off. Downstairs on the creative floor we were saving the company! Saving the industry! Building the foundation for the future—the companyʼs and ours! Upstairs, the top cheeses were planning to use the opportunity we were presenting them to make themselves richer with reckless disregard for how we might suffer in the short term, or how the company and our future might be damaged in the long term. Too bad for them that Marvelʼs prosperity was so well publicized. Too bad for them that a sharp cookie like Gabelli could make some reasonable estimates, do some simple math and deduce that Marvel was worth more than three times the market cap of Cadence.
Too bad for us downstairs, too. Pressure from upstairs to publish more with less money and fewer people to fund Feinbergʼs expensive defense against Gabelli was intense. We succeeded because I managed to squeeze more work out of an already overworked staff (which did nothing for my popularity). We created new series, came up with a bunch of promotional one-shots and invented new ways to repackage old material. We put millions more in the war chest. It was the best of times and the worst of times—we were marching from victory to victory, but it was a double-time forced march.
Comics creators, not normally the most well-balanced of humans, become even weirder under pressure. The relieve stress in strange ways—and I began to believe that my main jobs were inmate control and suicide watch.
When the Shelly/Gabelli war for control began, I was cheerfully unenlightened about such things, but I got a battlefield education.
As it all unfolded, because I was among the top five Marvel execs, I was privy to a lot of the machinations of the Feinberg gang. I was their fair-haired boy, after all, the one filling the coffers and pulling profitable publishing miracles out of my butt daily—a loyal lieutenant to be well rewarded after victory had been achieved.
I also was among the rank and file workers every day. They didnʼt understand what was going on, and for the most part didnʼt want to. They preferred to keep their heads in the sand and hope that everything would come out all right, or, perhaps, that I would look after their—our—interests. I saw the effects the takeover war was having on them, and it became increasingly clear to me that no one upstairs—unless I was there, attending a staff meeting—gave a damn about them or their future. As my stupendous naiveté slowly wore away, and I understood that what I thought was doing my job well was actually serving the selfish interests of a few greedy bastards.
Then, rather suddenly, it was over. Feinberg and his partners in Cadence Management, Inc. bought off Gabelli and succeeded in taking Cadence private at a cost of $27 million. Shareholders received $17 per share. In a fairly short time, CMI succeeded in selling Marvel to New World Pictures for $46.5 million, and the rest of the Cadence companies for $30 or so million more. The way I see it, the shareholders were bilked by the board of directors to the tune of $50 million. And my troops? Just when I thought the crisis had passed and things couldnʼt get worse, they did.
Chapter Two will tell the story of the first big battle for Marvel, of the downstairs crazies who suffered through it, and my own consciousness-raising.
Chapter Three: “New World Aʼborninʼ”
In late 1986, two years after taking Cadence Industries, Inc. private, Shelly Feinberg and his henchweasels sold the Marvel Comics division to New World Pictures. A string of potential buyers prior to New World had been scared off by Feinbergʼs strange negotiating style, which entailed starting with outrageous demands, haggling endlessly and then, at the eleventh hour, reneging on what had finally been agreed to and, in Richard Bernsteinʼs words, demanding “a nickel more.”
New World was the ideal suitor—awash in junk-bond money, on an acquisition binge, eager to close a deal before the end of 1986 to avoid adverse tax-law changes effective January 1, 1987. New World was run by Larry Kuppin and Harry Sloane, two entertainment lawyers who had bought Roger Cormanʼs B-movie company, and Bob Rehme, a former marketing exec. They did only a cursory due diligence on Marvel and the deal seemed to be zooming along until, in mid-November, something threatened to derail it.
I quit.
Iʼd become increasingly at odds with the top management during the nearly two years of the Gabelli war and the nearly two years of Marvelʼs being on the block—three-plus years during which Shelly Feinberg, Marvelʼs president, Jim Galton and their ilk had become increasingly self-serving at the expense of my troops and our future. You might expect owners to be short-sighted and niggardly while a companyʼs on the block, but Shelly and company were out to set a new record. The pressure on me and my troops had been tremendous, and worst, Iʼd become aware that Marvel hadnʼt been paying creators incentives they were due.
I discovered this after a trip to Europe to visit international publishing licensees, where Iʼd seen foreign editions of many of our contract artistsʼ works in print, that Iʼd been unaware of. I checked when I got back to see if weʼd paid those artists royalties they were due. No. “Why pay them?” the CFO told me, “theyʼll never know about those books.”
Furthermore, he told me that his orders were to “delay or not pay” any money owned to artists that he could.
My first instinct was to let the artists in question know what Marvel was doing to them. But then what? Theyʼd quit en masse, and the better ones would be received with hugs and kisses at DC Comics. That seemed drastic—scattering the team Iʼd worked so hard to build.
I decided to do everything I could to fight for justice, and if I couldnʼt get Galton to come around, then Iʼd quit. And then Iʼd tell the artists…
Once, Iʼd been CMIʼs fair-haired boy. But as the situation deteriorated, I became enemy number one. One of the moments that iced it was probably the time I stood in the intersection between Galtonʼs office, the corporate counselʼs office and the CFOʼs office screaming at the top of my lungs that if the artist and writer whoʼd created the Hobgoblin didnʼt get their $26,000 royalty for the Mattel action figure, that I was going to go to go to the Daily News with the story and launch a class action suit on behalf of the artists.
They were paid. Grudgingly.
After a number of such screaming matches over things like their idea of retroactively eliminating incentives, cutting benefits to creators and other charming ideas for saving money, it had become war between us. They must have felt very vulnerable, because none of them had ever even opened a comic book, and therefore they were extremely dependent upon me and my knowledge of the business. Executive V.P. Joe Calamari (no kidding!) once told me that they couldnʼt get rid of me because I was the only one who could tell them who could replace me.
In an attempt to fix that, they had begun to groom an ambitious young woman from the sales department, Carol Kalish, to become their new comics guru.
Still, though, at the eleventh hour of the pending New World transaction, they thought they needed me.
When Galton got my resignation letter, he called me to his office and literally begged me to stay. What did I want? he asked.
If my resignation had been a ploy, it would have been genius. A less naivé person, at this point would have called in his lawyer and had crafted a lovely contract with a splendid golden parachute. Not me.
I told Galton I wanted my people paid. He swore that the moment the deal closed, heʼd see to it. New World intended to keep Galton and several others of the owners in position as management. He couldnʼt do it now, he said, because it would be difficult to explain to New World why they were suddenly paying out all this money theyʼd never admitted owing, but after the closing, heʼd be able to engineer it.
I believed him. Yes, that is world-record, stupidity, but I had a reason. Galton had always been short-sighted and greedy, even when he didnʼt have to be. That wasnʼt so bad—Iʼd learned to work with it—by simply couching everything I ever asked of him in terms of how it would make Marvel money fast. You can work with greedy people if you know how to approach them. Other then that, heʼd always been honest, even a standup guy upon occasion. I trusted him. Stupid me.
On the morning of January 5, 1987, the deal closed. After heʼd signed, putting four or five million dollars into his personal pocket, Galton returned to his office to find me waiting for him. I had a list of artists who were owed money from foreign sales, toy royalties and other incentives. I told him it was time to settle up.
He said exactly, “Fuck you.”
Restraining the urge to toss this nasty little man out his eleventh floor window, I returned to my office to write another resignation letter.
I changed my mind, though, and wrote instead a letter to Kuppin, Sloane and Rehme telling them what they needed to know about Galton and company.
Kuppin and Sloane were very concerned. They had Rehme look into it. He quickly discovered that I was right. Then, he allowed Galton to fire me. Then, to preempt my going to the media with my story, they quickly paid all the overdue incentives—including $3,500 to me that I didnʼt know they owned me!
At my exit interview with Rehme, he said that they couldnʼt really keep me and fire, essentially, all the rest of top management. How would that look to their investors, especially since theyʼd just bought this company?
Amazingly, after spending twelve years of my life helping to build Marvel from a disaster to a winner, all I felt walking out that day was relief.
Chapter Three will tell the tale of how Marvel fell into the hands of the three stooges, Kuppin, Sloane and Rehme, and why that was bad.
Chapter Four: “If This Be My Destiny”
When I left, the Marvel editorial staff and freelances threw a “Ding, Dong, the Witch Is Dead” party. During my three-plus year war with top management, Iʼd been systematically undercut and vilified to my own troops. The same people who in 1982 would have followed me to the gates of Hell were convinced that everything that was wrong in their lives and everything that was wrong in the industry, was my fault.
Marvel faltered only a little after I left—not enough to please me—but running a comic book company is like piloting a hot air balloon. Turn up the heat and itʼll be a little while before you start to rise. Turn down the heat and youʼll coast along for a while before slowly starting to descend. It takes a while to build consumer loyalty, and it takes a while for it to erode.
I kept track of Marvel and New Worldʼs fortunes in the trades out of curiosity. What I saw in print, combined with my insider knowledge make it clear that Marvelʼs sales were slowly fading and New World was losing about a million dollars a day.
Hmm.
I figured that, at that rate, New World had under a year before their junk bond money ran out. I also figured that no one there was likely to turn it around.
New World did make some money, though, by speculating in the stock market. The three stooges were well enough connected to acquire insider information about several buy-outs in a row, most notably Murdockʼs purchase of MacMillan Books. By buying up McMillan stock just before Murdockʼs takeover attempt became publicly known, which made the stock price soar, then selling to Murdock, New World made a quick $18 million profit.
Several other similar scenarios worked in New Worldʼs favor. Buoyed by these successes, they were very heavily invested in the market when Black Monday—October, 1987 rolled around.
That did it.
At that point, having taken a near fatal beating on Wall Street, theyʼd have to sell something to stay alive, I thought. They only thing they had that was easily detachable and worth anything was Marvel.
Chapter Four tells the story of my first attempt to buy Marvel Comics and oust the Philistines.
Itʼs a story of highs and lows, a year of blood, sweat and smears. It involves intrigues, double dealings, betrayals, confrontations and trick maneuvers. Among the cast of characters were Chase, N.A., Bankers Trust, Warburg Pincus, Boston Ventures, The McFadden Group, Baker McKenzie, Weslay, Odyssey Partners, Ernst and Whinney, and more.
It ended with an eleventh hour deal hastily knit together among my management group, our advisor and senior lender, Chase N.A., and Shenkman Capital. We made a final round bid of $81 million. Ours was the only bid. We won. Shenkman signed a letter of agreement. For one glorious week, we thought weʼd done it.
Then, one morning, a small article in the Wall Street Journal announced that insider, Ronald O. Perelmanʼs Andrews Group had bought Marvel Comics for $82.5 million— enabled by an escape hatch in our letter of agreement with Kidder Peabody (who conducted the sale) and the fact that our armʼs length bid had set a value. Weʼd been used as a stalking horse.
Later, I had a meeting with Andrews Groupʼs CEO, Bill Bevins—an interview, actually.
They were considering hiring me as part of their management team. During our discussion, I found out that they would probably have one-upped any reasonable bid. Ours had been a hopeless quest.
Ultimately, Bevins didnʼt offer me a job at Marvel, though he seemed convinced that Iʼd do a good job. Though Bevins told me that their assessment of the current Marvel management, Jim Galton and cronies, was that if they all drowned in the East River one day, itʼd be a month before anyone at Marvel noticed they were gone, he planned to keep them while slowly filtering in their own people, to create the illusion of stability needed to facilitate their plans to take Marvel public in a year or so. There was no way I was going to quietly “filter in,” and that ended that.
So much for Marvel. At least, thatʼs what I thought at the time.
Next week: $UPER VILLAINS Part 3, The thrilling conclusion
Note from JayJay: The final part of a book proposal Jim wrote in 1998.
Chapter Five: “The Perelman Cometh”
During the Ronald O. Perelman era, Marvel became hugely inflated, much like the Hindenburg.
The comics themselves were mysterious to Perelmanʼs management people—including Galton and the other holdovers. They were strange, gaudy hard-to-read things churned out by odd-looking people downstairs. The managers Perelman filtered in, however, know something about marketing. Realizing that many comics were bought by collectors, they began taking, what to them, was the obvious step of turning Marvel into the Franklin Mint. “Special” issues that every collector had to have came out in a flood. How could a collector not buy several copies of the Ghost Rider issue with the glow-in-the-dark cover? How could they not buy the special hologram cover issues, the gold foil cover issues, the die-cut-embossed-variant-platinum cover issues of Spider-Man, The X-Men, et al?
As Marvelʼs emphasis shifted to marketing gimmicks, it shifted away from creative. Disgruntled creators began bailing out, or being driven out. If you can sell a book by pasting on a hologram at the printer, who cares if the story inside is any good? Who needs high-priced “star” artists?
I happened to meet new Marvel president Terry Stewart at the Frankfurt Book Fair in October of 1992. He told me how well they were doing—two great years in a row. He said he felt like heʼd won the lottery each year. “Youʼre supposed to be the great comics guru,” he said. “What should we do next?” I told him theyʼd used up all the easy shots, done every “event” marketing trick to death, and now, they were going to have to create—publish good books.
He laughed.
Chapter Five will tell the story of greedy-publishing, spectator-pandering, fad marketing driven, over bloating that was the beginning of the end for Marvel.
Chapter Six: “Turning Point”
It seemed as though from the moment Gabelli began his attempt to take over Cadence Industries, my life became a series of setbacks and frustrations. The bitter parting with Marvel, and the disappointing outcome of the auction were just the beginning—many more disasters and disappointments came along before I finally finally arrived at a moment of vindication and success that belongs on the all-time highlight reel.
Warburg Pincus, which had been interested in the Marvel sale invited me to submit a plan for a start-up—then later reneged on promised funding.
I explored buying Harvey Comics, a once-thriving then almost defunct publisher of young kidsʼ comics, like Richie Rich and Casper the Friendly Ghost. Harvey was owned by three people who hated each other. After a meeting at their offices with one of them, who insisted that we do our talking in a closet, lest the other two should overhear, I decided that this deal was more grief than I needed.
A consulting gig with Disney, which was supposed to turn into a full time job didnʼt pan out. They thought I was great—but too “controversial.”
While these dead ends were playing out, things were getting grim for me financially. Pursuing Marvel had cost, by my modest standards, a great deal of money, and I hadnʼt been able to get much freelance work due to my pariah-hood.
Finally, I was able to convince a small venture capital company, Triumph Capital, L.P., to fund a start-up comics company. With the same partners whoʼd joined me in my attempt to buy Marvel, J. Winston Fowlkes and Steve Massarsky, I launched Voyager Communications Inc., publishers of comics under the imprint VALIANT. I was confident that we could out-create and out-compete Marvel, the market leader, where creativity had been thrust into the rumble seat since Perelman and his marketing mavens had taken over.
Fowlkes was a retired Time Inc. financial officer—a wealthy man who got involved with my comic book ventures because he found the whole business fascinating, and quite a change from his relatively stodgy Time days. He was the “gray hair” of the group, the experienced financial person that gives lenders and investors comfort and confidence. Massarsky was an entertainment lawyer. Besides the obvious advantages of having a lawyer on board, he had contacts in the film and music industries that I thought might prove useful.
Triumph Capital was essentially a two-person operation—Michael Nugent, an older man, and Melanie Okun, a thirty-year old woman. Before starting Triumph, theyʼd been a successful investment banking team at Bankers Trust Capital. Triumph owned 40% of Voyager, Fowlkes, Massarsky, and I each owned 20%. Nugent, Okun, Fowlkes, Massarsky and I comprised the board.
My joy and excitement about starting Voyager, not to mention having a job, was shortlived. We closed our funding deal with Triumph in November 1989. Just before Christmas, Massarsky informed me that he was sleeping with Melanie.
That worried me. Fowlkes, though, was absolutely appalled by the obvious conflict. He grew even more appalled as Massarsky spent more and more time courting Melanie and less and less time doing his job. Fowlkes finally complained to Nugent, hoping he would do something. He did. He called a board meeting, and with a three-fifths majority—himself, Okun and Massarsky—fired Fowlkes!
I was thunderstruck. Triumphʼs intention was to clawback Fowlkesʼs stock and simply terminate his contract. I took the following stand: either they had to settle with Fowlkes to his satisfaction, or Iʼd quit.
Ultimately, they agreed to a deal by which Fowlkes kept half of his stock, 10% of the company, and would be paid the entire amount due under his three-year employment contract. He was happy with the settlement, and happy to be away from Massarsky and Triumph. I agreed to stay.
I stayed because I reasoned that, though Nugent and Okun were vipers, most venture capital people are vipers; though Massarsky had proven to be a self-serving, doubledealing scumbag—he was a lawyer after all—that they needed me. I was the creative guy. The success of the venture depended upon me, therefore, they couldnʼt do anything too bad to me without cutting their own throats. Besides, all they wanted was money. If I could make Voyager successful, and I knew I could, theyʼd want to exit.
Maybe I could buy them out.
There were other reasons, too—I needed the job. Furthermore, Iʼd hired a number of my friends to work there, including several whoʼd given up other jobs, and they needed the jobs. Committing to work for me, The Great Satan, had pretty much gotten them blackballed elsewhere. Perhaps most importantly, I needed a victory. I was tired of being a pariah. This was a chance, however tainted and soured, to redeem myself.
Chapter Six tells the story of VALIANT, how we overcame incredible odds, not the least of which were my corrupt partners, to emerge as a phenomenal success. We would gain over 11% of the then-robust market and be on our way to a fiscal year with an EBIT over $18 million from publishing alone, on approximately $38 million of sales. Marvelʼs gross was higher, but its publishing profit was substantially lower. We were a force to be reckoned with, and growing stronger. Supplanting Marvel as the industry leader was a thinkable goal.
At the Diamond Comic Distributorʼs 1992 Retailer Convention, VALIANT was voted Best Publisher, and I was given the Diamond “Gemmie” lifetime achievement award. As I walked up on-stage in front of 3,000 retailers, plus representatives of every major publisher and product manufacturer for the comics market, I got a sustained standing ovation.
These same people would have thrown rotten vegetables only a year previous.
The quality and innovativeness of our creative work at VALIANT, and our success had in fact, redeemed me. How could I be a bad guy if my comics were so good? I was on top of the world. It was one of the best moments of my life.
I should have known it couldnʼt last. In the shadows, Super Villains were scheming…
Chapter Seven: “By a Friend Betrayed”
Well, Iʼd once considered Massarsky a friend…
My theory that Triumph and Massarsky couldnʼt get rid of me because I was the creative guy, upon whom success depended was accurate up to a point. The point came once Iʼd created a universe of characters that were successful, pre-tax profit was rolling in over the gunwales at a rate of $2 million a month, and the entity could be sold for an astronomical sum. That would have been June of 1992.
First, I was told that Triumph wanted us to sell a controlling interest to Allen & Company. Melanie Okunʼs brother, Glen Okun worked there, and had assembled a group of investors including Michael Ovitz, Wayne Heuzinga, David Lazarus, Herbert Allen and himself who were willing to pay $9 million for a controlling interest. With their substantial influence, the story went, the company could be built up with toy deals, film deals and distribution through the Blockbuster chain, then sold to, say, MCA Universal for megabucks.
Terms of the deal included Glen Okun replacing me as CEO. I was given a ten-year employment contract with a two year non-compete, specifying no appreciable increase in salary, no title, no duties and having 100% clawbacks of my (much diluted) stock, should I “fail to engender good morale,” or “fail to report to, of fail to obey “Massarskyʼs brother-in-law (by now, he and Melanie were married).
They needed my consent, I went through what is known as a “cramdown,” for a week.
Ultimately, I wouldnʼt agree to this nightmare scenario. I knew that wouldnʼt stop them, but I thought it better to force them to get rid of me now, as opposed to letting them do so at their convenience later.
I was summoned to a board meeting at 9:00 AM one morning near the end of June and summarily fired. I was told not to go to the office. Two armed guards were there to deny me entrance.
Meanwhile, at Voyagerʼs Seventh Avenue office, my secretary, and several of the people most loyal to me were being fired as well. They were escorted out and their personal items were dumped on the sidewalk outside.
My assistant, Bob Layton, my sales manager John Hartz and our best artist, Barry Windsor-Smith stayed, their loyalty purchased for several million dollars in stock each.
The spin control to consumers and the comics community in general was easy. Massarsky and company simply dredged up the old Marvel slime—Iʼd been a megalomaniac, I tried to kill a really great deal with Allen & Company because Iʼd lose some power, and besides, other people actually did all the creating—I just stole credit for their work, etc., etc. It was an easy sell, since us leopards canʼt really ever change our spots. I was a pariah again overnight.
Since I could no longer prevent it, Massarsky, Okun, and Nugent went through with the Allen & Company deal. Roughly a year later, Voyager was sold to Acclaim Entertainment for $65 million. Enrique Senior at Allen & Company later told me, when I met him at a meeting with Savoy Pictures, on whose board he served, theyʼd had serious discussions with other parties at much higher prices, but those parties had backed away because the creative guy—me—was gone. Even the price Acclaim paid, he thought, was too much.
He turned out to be right. My “hot air balloon theory” kept Voyager prosperous for a while after I was gone, but sales eventually began to fall, then collapsed. A few weeks ago (April 1998), Acclaim Comics, nee Voyager, went under.
Chapter Seven tells the tale of one of the nastiest examples of financial predation Iʼve ever heard of. Forbes Magazine found it appalling enough to publish a feature article about my experience entitled “How Not to Start a Company: What Do You do When Your Partner Tells You Heʼs Sleeping with the Venture Capitalist who Backed Your Business?”
Chapter Eight: “Man on a Rampage”
After Massarsky, his wife and her partner got rid of me, first they sued me, then they forced an arbitration in an attempt to recapture my shares. They had the best lawyers that the vast sums of money Iʼd made them could buy, plus they were willing to lie under oath and falsify documents. I had the best lawyer no money could buy and truth on my side.
Hereʼs a maxim for you: the best lawyers win. Ask O.J. My arbitration award for the 25% of Voyager I owned was about enough to pay my legal costs. Truth doesnʼt seem to count for much. The arbitrator himself caught their side in lies and contradictions several times, but, in the end decided to value the company on the day I was fired—which would be like valuing the Jim Hensonʼs company on the day before the Muppets TV show aired—and to use the Allen & Company “offer” (made by Massarskyʼs brotherin-law) as the value. They later sold voyager for $65 million.
Welcome to America.
I knew, though, that I could do it again. I set out to raise money. Again.The success of Voyager made it fairly easy, despite the fact that Massarsky and company had reprised the Shooter-is-a-monster legend. I had half a dozen offers to fund my new company. Over Patricof and others, I chose The River Group, which also owned a trading card company, figuring that the synergies between comics and cards would be useful. This time I insisted upon and got majority and control. In February of 1993, I founded Enlightened Entertainment Partners, L.P., capitalized at $4.5 million, which would publish comics under the appropriate imprint DEFIANT.
The first property I created was “Plasm,” a sci-fi world where everything, and I mean everything including the world itself, was alive.
Within a month, I presented the Plasm concept to Jill Barad and her boys toysʼ staff at Mattel, and walked away with a three million dollar guarantee against royalties deal for an action figure line. They anticipated $10-50 million in sales the first year.
Pre-launch publicity for the comics, a trading card set being produced by my partners and the toys began.
Then, Marvel sued us for trademark infringement. It seemed they had a character called “Plasmer” registered in the U.K. “with intent to use” by their British publishing division. We tried to settle. At their lawyersʼ behest, we changed our name to “Warriors of Plasm,” and thought it done with. But, they never returned the signed agreement, let us launch our first product, a trading card set and sued us, despite our agreement.
Similarities in comics names are common. DC has “Wonder Woman,” “Power Girl” and “Hellblazer.” Marvel has “Wonder Man,” “Power Man” and “Hellrazor.” One has a “Guardians of the Galaxy” and one has a “Guardians of the Universe,” but I forget which is which and who has what. Which is the point.
The judge, Michael B. Mukasy (who also tied the World Trade Center bomber case) got the point, and found in our favor—emphatically. His opinion was practically a scathing denunciation of Marvel. Defending ourselves took six months and cost us $300,000, however, and the Mattel deal, which was put on hold pending the outcome of the suite, and canceled once weʼd missed out launch window. Talk about a Pyrhic victory.
Bleeding us and wasting our time was Marvelʼs real goal. After all, the last company Iʼd started had taken ten or so points of market share out of their hide. What better way to squelch my new venture then to burden it with expensive litigation. It worked. We were crippled coming out of the gate.
Our first comic book issue was published in August 1993. That month is notable in another way, too—itʼs the month the Great Collapse of the Industry started.
The industry had been enjoying a boom driven by speculators and collectors for several years. Following Marvelʼs lead, virtually every company was producing “collectible,” special issues with wild abandon. DC published the “Death of Superman” issue, which collectors bought by the case, certain that it would skyrocket in value. Fourteen million copies were sold, Marvel published a new X-Men issue #1—collectors love #1 issues—and sold eight million copies. It got so that virtually every issue from every company (except mine) was a “special,” with a birth, death, wedding, costume change, team break-up, team re-formation, hologram, foil cover, premium insert or other trumped-up event that collectors might think noteworthy enough to buy extras.
The boom was false prosperity. For some reason in August of ʻ93, the collectors all got wise at once to the fact that if 14 million copies of an issue have been squirreled away by collectors its greatest value is as bird cage liner—and it will never be worth big money until 13,999,999 birds have dumped on it.
Chapter Eight tells the sad story of DEFIANT, thwarted at every turn. In a collapsing market where nearly a hundred of the six thousand or so comics retailers extant were going under every week, where nearly every comics titleʼs sales were falling precipitously,
DEFIANT couldnʼt survive.
We had two last chances. I got a call from Bob Shea and Michael Lynn of New Line Cinema, who wanted to buy an interest in DEFIANT for its characters, and as a development engine. They were willing to make an investment which would have been, I think, enough to see us through the worst of the collapse and perhaps position us to lead a turnaround in the market. I wanted to maintain my ownership, but got them together with my financing partners. A deal was put on the table that would let New Line step into The River Groupʼs shoes as my backers, tripling their investment in about a year, and still leaving them with 10% of the company.
They turned it down! I tried to point out to them that the Good Ship DEFIANT was sinking… Enter Savoy Pictures. I got a call from Victor Kaufman who expressed the same interest as Lynn and Shea had. They made The River Group an even better offer.
Strangely enough, Allen & Company was deeply involved with Savoy, and I found myself negotiating with Enrique Senior of Allen & Company, who was on Savoyʼs board, and would be on DEFIANTʼs board if the deal went through. Enrique had been involved with the VALIANT deal, seemed to know exactly what had been done to me, and was okay with that. He had an “itʼs just business” attitude about it—and the deal currently under consideration—that was both chilling and fascinating. Though he was professional, dispassionate and utterly uninterested in the human side of these occurrences— as opposed to the numbers—I think that in some small way he thought it suitable that I, a “creative guy,” who had been burned badly on one deal would benefit from another. However, four months later, The River Group was still haggling over $80,000 for their legal costs, holding up our $11 million deal. Savoy gave up on them.
DEFIANT ran out of money and closed its doors at the end of August 1995.
Chapter Nine: “The Web of the Snyder,” or “Along Came a Snyder”
I was starting to suspect that I sucked at picking partners. Massarsky, Triumph, and The River Group all belong on the tenth level of Hell as far as Iʼm concerned.
Finally, though, I found a good one—television and film producer Lorne Michaels. My association with Michaels was good—the fact that it led to an association with Dick Snyder was not.
Michaelsʼ interest in comics was similar to Lynnʼs, Sheaʼs, and Kaumanʼs. Michaels and the president of his Broadway Video Entertainment, Eric Ellenbogen, saw the comic book business as a development platform for television and film properties. After DEFIANT closed, Ellenbogen hired several of my former creative employees, and eventually hired me as well to undertake development of a licensed property they controlled. He was sufficiently impressed with our efforts to offer to fund another comic company start up for me, and so Broadway Comics was born.
Ellenbogen was aware of the sorry state of the comics market in early 1995, but wasnʼt concerned about our selling huge numbers of comics. His intent was that we create and develop useable properties; that we attract great talent and become “Idea Central.” All he asked was that we not lose too much money until television and movie exploitation started paying the bills.
Things went along pretty well for a while—until Lorne Michaelsʼ company sold Broadway Video Entertainment, including us, to Golden Books Family Entertainment, which was run by Dick Snyder of Simon and Shuster fame.
It was the second time I experienced a cramdown. Among the terms of the fifty-fifty partnership I had with BVE were provisions that, in the event of a sale, entitled me to opt to buy BVE out, to approve certain conditions or the sale, or in some circumstances, to refuse to go along. Iʼve never talked to Lorne Michaels about this, and Iʼd like to think that he didnʼt know how his lieutenants went about it. It was ugly.
Broadway Video, Inc., BVEʼs parent company was run by president John Engleman. Engleman apparently decided that rather than risk complications from me, heʼd deliberately keep me in the dark about the deal until the last minute—a violation of our agreement—an attempt to arrange things so that I had no choice but to play ball.
Chapter Nine tells the tale of Englemanʼs evil, and how, to keep my people from being summarily tossed out on the street, (for several it would have been the second time), I had to go along.
It also tells of what happened to my battered little band of creative crazies once we were in the web of the Snyder.
Chapter Ten: “When Titans Clash”
In 1992, when I told then-Marvel president Terry Stewart that marketing gimmicks would eventually fail, and that eventually theyʼd have to get back to the business of creating new things, new ideas and better entertainment, he laughed.
A year later, with the blush quickly fading from the marketing-gimmicks dandelion, they tried creating something. The trouble was that, during their Franklin Mint period, theyʼd pretty much lost or driven away their creative heavyweights.
What the remaining flyweights came up with was “Marvel 2099”—a group of new titles set a century in the future featuring “future versions” of the standard Marvel characters. Maybe if the concept had been very well executed, it might have been more than derivative trash, but the concept was merely, well…executed.
Among the other big ideas the downstairs dregs came up with was a Spider-Man storyline wherein it was revealed that it hasnʼt really been Spider-Man having all those adventures for the last couple off hundred issues, it was a clone. The real Spider-Man had been off somewhere afflicted by amnesia.
Fans didnʼt like this idea at all. Eventually, the writers were ordered to write their way out of the storyline and Marvel actually apologized for it—but not before publishing more than a yearʼs worth of the lamest, most convoluted, tedious stories imaginable.
Almost unbelievably, down the hall, another editor launched a storyline for Iron Man based on the idea that several hundred issues ago heʼd been replaced by a “Life Model Decoy,” that is, an android duplicate.
The joke around the industry was that Marvel, which had called itself “The House of Ideas” since the early sixties had become “The House of Idea.”
It seemed that no thought was too stupid for Marvel. Anything that crossed the alleged mind of an editor might find its way into print. No one was, or is to this day, running the asylum. No one is there to reject bad ideas or encourage good ones.
The trouble was that no one upstairs at Marvel, no one with any real power, read or understood
the comics. Since I was drummed out, there has been no one who is both an upstairs executive and a downstairs creative person. A great divide exists…
Terry Stewart once told me that he know some of his editorial people were good and some werenʼt, but neither he nor his publishing executives were capable of sorting them out.
Sales started to plummet in August of 1993, and have kept falling ever since. The comics market and the trading card market are closely related, so it wasnʼt just the comics collapsing. Marvelʼs Fleer and Skybox units fell as well.
A source close to Perelman told me that Perelman knew heʼd built a house of cards with acquisitions like Panini, Skybox and Fleer, but intended to sell Marvel to Sony or another entertainment giant while it was at its peak. The collapse came too soon and too suddenly, though. I think the wretched failure of their creative effort—the word “effort” seems wrong somehow—was what triggered the avalanche.
At first, Marvel management blamed their collapsing sales on their distributors, and bought the third largest comics distributor, Heroes World Comics and Cards, in order to get control into their hands, and out of the hands of “incompetents.”
What a disaster! Within three years, Heroes World was defunct, one of its principals, wanted for embezzling, was a fugitive, and Marvel was begging for distribution.
The shrinking market had left only one distributor alive, Diamond Comic Distributors, Inc., which is partially owned by DC Comics. Given a choice of one, Marvel signed up. They still donʼt get it at Marvel. Iʼve spoken to top Marvel execs who, to this day blame the collapse of the comics on competition from video games, inexplicable “cycles,” that govern such things, or platitudes like “kids donʼt read anymore.” As if anyone could read some of that drivel…
They donʼt understand that the comic book business is a relationship marketing business. It has more in common with the single malt Scotch business than with other publishing or the collectibleʼs business—and the first step toward building the relationship with the audience—the all important, very personal love between a fan and, say, the XMen—is good creative work.
As Marvel foundered, Carl Icahn and other holders of Marvel bonds including High River L.P. and Westgate International L.P. began to move to usurp Perelmanʼs control of Marvel.
The first major shot fired in the war was when Marvel declared bankruptcy, entering Chapter 11 on December 27, 1996, “in order to complete… reorganization without bondholder consent.”
The financial and courtroom battles between Perelmanʼs forces and Icahnʼs forces over the rotting remains of Marvel was well chronicled in the press. I have a virtually complete set of clippings from the Wall Street Journal, the New York Times, Crainʼs, Barrons and other publications buttressed with information I garnered from a friend on Icahnʼs board, and several meetings with Scott Sassa, Bill Bevins and other sources close to the fighting.
What isnʼt covered in those articles is the collateral damage from the fighting, the stories of the people in and around the business whose lives and livelihoods have been damaged.
A lot of them are people close to me. From the biggest retailers in the country, who are watching twenty-plus years of their efforts to build their business crumble to dust as Marvel takes the industry down with it, to artists, writers and production people who donʼt quite understand whatʼs going on, but wish it would stop.
Chapter Ten, which will be the longest and meatiest chapter (probably divided into several sections), tells their stories as well as the story of the war of fortunes.
In early Marvel Comics, when Stan Lee and artist Jack Kirby would depict titans like the Hulk and the Avengers clashing, the battle would always wind up in an “abandoned warehouse district” where “miraculously” no one was hurt by the sweeping devastation they caused. Perelman and Icahnʼs clash, however, has harmed plenty of innocent victims.
Every week or so I hear from George Roussos, a staff colorist at Marvel. George is pushing eighty with a bulldozer, and has been in comics all his life. Heʼs seen it all. He canʼt believe what heʼs seeing now. Itʼs sad to watch something once great, once vibrant and alive die—especially if youʼre inside it at the time.
While Marvel languished in bankruptcy for nearly a year, Judge Hellen Balick kept hoping that Icahn, Perelman and the principals of Toy Biz, Inc. could work things out. Toy Biz is a company partially owned by Marvel and much embroiled in the dispute.
Finally, in August of 1997, Judge Balick retired, and the case fell into the hands of Judge Roderik McElvie, who wasted no time appointing a Trustee, ex-judge John Gibbons. Gibbons set out expeditiously to settle the Marvel mess by selling it all or in pieces to the highest bidder. A “document room” was set up at his law firm, Gibbons, Del Deo, Dolan, Griffinger & Vecchione.
With the help of investment bankers from McFarland Dewey & Co., I put together a management team including former top-tier ABC/Cap Cities execs Bruce Maggin and Brian Healy, and gained the interest of Perry Capital Investments, Inc.
We went to the Gibbons, Del Deo law offices in Newark in late January of 1998 to examine the possibilities. There werenʼt any. Marvel is so inextricably tied to Toy Biz by an outrageous license for all toy categories, for all Marvel properties, in perpetuity, with no royalty, that it really isnʼt worth much—except to Toy Biz, which has an offer pending.
We left disappointed—then came up with the idea of buying both Toy Biz and Marvel, which would render moot the license, and also effectively end the snowstorm of lawsuits flying between Toy Biz and Marvel—a nasty passel of contingent liabilities.
For that we needed a toy company partner on our team, someone who could effectively run Toy Biz, and to whom Toy Biz and the Marvel license would be an asset. I called CEO Jill Barad at Mattel. Her president of Corporate Operations, Ned Mansour called me back. Yes, they were interested. We arranged a meeting.
That proved to be a dead end, for the time being at least. After a cursory look at the situation Mattel backed away.
We learned, however, that should Toy Biz succeed in acquiring Marvel, one of the conditions required to gain the secured creditorsʼ approval of their offer was that the combined entity be offered for sale immediately after the acquisition closed. The creditors who would own over 40% of “Newco,” as part of the deal, wanted at least an attempt to be made to turn their stake into cash.
So, why not wait, let Toy Biz suffer through uniting the two companies, and perhaps make a bid for Newco?
Weʼre in wait-and-see mode.
Meanwhile, Icahn and his group turned up again with another offer of $475 million in cash. Meanwhile, theyʼre also suing to assert control they say they should have over Toy Bizʼs board, under terms of Marvelʼs deal with Toy Biz. Toy Biz is firing back, and the whole mess drags on and on, and every day the industry dies a little more.
Chapter Eleven tells why breaking up is so very hard to do when Super Villains are involved.
Epilogue: “The Final Chapter?
Is it all over for the industry, no matter what the outcome of the greatest Super Villain mine-is-bigger-than-yours contest in many a moon? Many people seem to think so.
Total industry volume continues to shrink month by month, comics retailers are going under daily and no oneʼs making money. There is a critical mass level—a level below which too few stores are selling too few copies to sustain themselves, and justify publication of the remaining comics titles (down from around seven hundred a month to slightly over two hundred a month). The fact is that the industry is already below critical mass level.
People are hanging in there, staying this crazy business because they love it. Therein, lies the hope. Theyʼre clinging by their fingernails, hoping that Marvel will be resurrected and lead a new wave of growth, or that something will happen to turn things around. As long as they believe itʼs possible, it in fact is.
The last time the industry nearly tanked, in 1978, we fought our way out of oblivion with a combination of intensified creativity and a revolution in distribution.
Marketing comics over the world wide web seems to be emerging as the new distribution—but distribution is useless without a good product to sell.
Whoever finally captures Marvel has the chance to resurrect the industry by cleaning house, bringing in talent and once again, producing a quality product. People still love comics. Ink and paper are not dead (though Iʼve been hearing about their imminent demise since the sixties). Itʼs still a powerful medium, and it still has a place.
Many people have suggested that the long-awaited Jim Cameron Spider-Man movies, if it ever comes, may re-ignite interest in comics. Yes, but again, only if the comics are good. The Batman movies didnʼt do much on a sustained basis to sell the Batman comics, because the comics were and are pathetic.
Itʼs going to take excellent creative, and since no one else is stepping into the industry leaderʼs role, I think itʼs going to take Marvel to make it happen.
Itʼs time for heroics. Will the Super Villains succeed in crushing the life out of this hapless industry? Or will it get one last chance?
Weʼll know soon. Thereʼs not much time for more cliffhangers—weʼre turning to the final page, right now.
Note from JayJay: Here’s a look into our creation process. We used to compile these lists to help us come up with characters and story ideas. We did a few of them over the years, but these are a couple of later ones that were commited to computer, unlike earlier ones which were hand-written and may be lost to time.
Types of Origins and Powers
Origins
Magic
Magical object (Aladdin’s lamp, the Philosopher’s Stone, Ruby Slippers, the Witchblade, etc.)
Magical being (wizard, genie, Tinkerbelle, etc.)
Magical creature (horses like Shadowfax or Pegasus, dragons, monsters)
I never want to do anything typical or standard. For instance, I didn’t feel the need to go any particular direction for any VALIANT title. For each new title, I went with the best idea we had at the time. All I cared about was making each one good, gutsy and groundbreaking.
I start by thinking about events that might be in the story, the effects those events might have upon the characters and, conversely, how the characters would shape the events. I think about what is, or might be at stake, both in plot terms and in human terms. This is very much a freewheeling process—I play “what if…?” a lot and imagine recklessly. No thought, no idea is too far out at this stage. Nothing is out of bounds. Usually, I write down pages and pages of notes—ideas, snippets of dialogue that occur to me, character bits, scene ideas, real events from my own life that relate, events from the lives of people I know or have heard tell of that relate; whatever. I make lists of words or things that relate to the ideas that come up—for instance, if the story might involve the sea, I’ll probably make lists of nautical terms, fish, ships, etc. Free association. I do a great deal of research into the ideas that come up. At first, the research is speculative—just poking around for more items to include in my notes and lists—but as I become more sure that something is going to end up in the script, the research becomes more focused. I even make sketches.
While doing all of the above, I’m also thinking about what I have to say about the subjects that emerge. Do I have any insight I can offer? A new thought, a new way to look at something…or an “observation about the human condition,” as a former publisher I knew used to say. I’m not talking about building a corny moral into the story, or some stupid lesson; not just a stupid irony, or even a clever O. Henry-style irony. I’m talking about things that make the reader say, “I never thought of things that way before,” or “I’ve never seen anything like that before,” or “I know just how that character feels,” or “I understand that more deeply, or in a different way, now,” or…whatever.
For instance, my Legion of Super-Heroes story, entitled “One Evil,” has a subplot about a leadership crisis. I know about such things from both sides—being the leader of an organization in difficult times and being a follower in such a situation. I have plenty to say about that subject, plenty of insights to offer. If I can convey to the readers something new via the characters involved, what they go through and the way they go through it, that’s a good thing.
Those are the kind of things that can touch the reader, involve the reader and make a story personally meaningful. And, that’s the hard part. Often, I fail spectacularly. Once in a while, I think, I succeed. At least a few times in my life I’ve succeeded, apparently, because a few people have come up to me at conventions and told me that something I wrote moved them.
I remember stories Stan Lee wrote, that I read as a kid, that moved me, and how much they meant to me. It’s a wonderful thing. Rare, in my case, but wonderful. I keep trying.
Solid structure is not formula—it’s effective communication.
Jim Shooter
Writing a story is architecture as well art. Once I have my ideas sorted out, I try my best to build a story using Aristotelian principles. Solid structure is not formula—it’s effective communication. Most great Western literature is built using Aristotelian principles, as are pretty much all television and movies.
Summing it up, you need a good story to tell and the ability to tell it effectively.
My scripts are very detailed. I provide the artist a great deal of reference—photos, web links, even sketches, sometimes. I’ve seen some other writers’ “full scripts” that are less than 3,000 words for 22 comics pages. Mine are generally 12-15,000 words. I work things out pretty thoroughly. That doesn’t seem to stop some artists from high-handedly “interpreting,” though—and ignoring things, and just plain butchering things. Sometimes, what they do is extremely disappointing. “Look what they done to my song, Ma….”
When I started at Marvel in 1976, the common “wisdom” among many big-name editorial/creative people was that certain kinds of books “don’t sell.” The genres on the “don’t-sell” list included Westerns, romance, science fiction, fantasy, comedy and more. What idiocy! Every time someone in my presence said anything like, “Science fiction books don’t sell,” or “Westerns don’t sell,” I would say, “Show me a good one!”
Two former Editors in Chief of Marvel actually said to me that “good” books don’t sell! Their opinion was that all the readers wanted (they referred to these generic readers as the fans from “Fudge, Nebraska”) was to see the Hulk slam the ground and make the shockwaves that knocked the soldiers over—again and again and again. They often cited lower-tier books like Jim Starlin’s Warlock, McGregor/Russell’s War of the Worlds and anything Chaykin did as “proof” that good books don’t sell. Again, what idiocy! I can give you dozens of reasons those books didn’t do as well as the Fantastic Four or the Amazing Spider-Man, none of which have to do with them being “too good.”
Sales of comics in the United States these days are generally pathetic. When I was EIC at Marvel, we’d cancel any title that fell near 100,000 copies a month. Our line average was around 300,000! Today, few books reach as high as 100,000 a month. Most mainstream books from major publishers scrape by with pathetically low sales numbers, many under 30,000. Fortunately, the economics of the business have changed so that titles can survive at much lower sales figures than when I was at Marvel. Small indies can hang on with sales of only a few thousand copies. This has opened up a lot of niches.
Therefore, today, the good news is that there is a much wider variety of genres available. The bad news is the same as before—too many books in every genre just aren’t good. “Show me a good one!” still applies.
Some will tell you the reason for low sales is lack of distribution. Nonsense. I believe that if there were comics racks in every store in America, it would make little difference. The overwhelming majority of comics published here are not only not good—they’re unreadable.
The art in comics is generally better than ever, the writing is often clever and glib, but in spite of that, far too many comics are utterly impenetrable.
Anyone can pick up almost any novel off of the rack—and they’re able to read it and understand it. Anyone can turn on almost any episode of any TV show—even if they’ve never seen that show before, they can get the gist and follow it. Anyone can go to almost any movie—and they can make sense of it. But if anyone other than a hardcore fan picks up a dozen comics at random off the rack, I’d be surprised if they could make sense of/understand/follow even one of them. Even hardcore fans find many comics daunting to follow!
The craft of comics storytelling is all but lost. A Who’s Who of industry bigshots have privately agreed with me when we’ve discussed exactly this subject, but it’s a tough problem to fix, given the often huge egos of the creators, general creative anarchy, and lack of trained editorial people.
Good craftsmanship doesn’t inhibit creativity—it ignites creativity.
Jim Shooter
I had a similar problem when I became Editor in Chief of Marvel in 1978. I slowly dragged the creators kicking and screaming toward better stories and especially better storytelling, and, oh, by the way, that led to Marvel surging to leadership of the industry—almost 70% market share—and a truly amazing era of incredible creativity! Good craftsmanship doesn’t inhibit creativity—it ignites creativity. Our VP of circulation used to say that the reason we were so successful, even if other companies out-promoted us, had better production values, marketed better, had more well-known characters, whatever, was that we “beat ’em between the covers.” Better stories better told.
Genre is the least of our concerns. We need to produce brilliant and accessible work—a lot of it, for a long time.
When Watchmen came out, it brought a lot of new readers into comics shops. They enjoyed Watchmen, thought, “Hey, comics are cool! Who knew?” They went looking for more good stuff. They were disappointed to find too few other accessible, entertaining things. We, as an industry, need to produce things that sweep the nation—and have more good things waiting for people who get swept up into comics.
I think that a lot of what the big companies produce is driven by marketing concerns—foolishly. I think they’ve worn out the mega-crossovers and Crises. They need to think of something new. I think a lot of the indie creators worry about and hope for movie and merchandise deals way too much. They should learn their craft and focus on that. Too many writers and artists spend too much time playing permutations—recycling old characters and old stories. We need to create! And, again, as an industry, we need to learn our craft.
