'Partners at the Collective Split to Launch New Firm'

VARIETY

The Collective partners Sam Maydew and Jeff Golenberg are preparing to exit the management-production powerhouse to launch a new entity focused on repping clients in film and TV.

Michael Green will remain CEO of the Collective, overseeing its digital media operations and management departments that rep music and digital clients. Green’s side will retain what was characterized as a passive investment in the Maydew-Golenberg entity, and vice versa.

For the short term, Maydew and Golenberg will remain at the Collective’s current office space in Beverly Hills but will look for its own digs down the road. The pair are expected to take about 15 Collective staffers with them at the outset. The sides are still in the early stages of working out the separation plan.

Sources emphasized that the split was amicable and comes after a period of rapid growth for the company. The partners decided that because the skill sets and needs of the film/TV department were so different than digital/music, it made sense to divide the biz in a way that would allow each side to make their own decisions about how best to deploy manpower and resources. Sources close to the situation downplayed rumors of tensions between the camps because profits were being funneled into efforts to expand the digital biz.

Maydew and Golenberg plan to take their entire roster with them in the move.  Those clients include Emile Hirsch, Evangeline Lilly, Jai Courtney, John Leguizamo, Vincent D’Onofrio, Jason Isaacs, David Krumholtz, Cat Deeley, Chi McBride, Eliza Dushku, Josh Peck, Ashley Madekwe, Christa B. Allen, Barry Sloane, Ramon Rodriguez, David Morrissey, June Diane Raphael, Wilmer Valderrama, Max Schneider amd Derek Hough, among others.  Comedian Martin Lawrence will remain repped by both firms.

On the production side, Maydew and Golenberg will continue to work with Green as producers of a pilot for Leguizamo at ABC and the Lawrence/Kelsey Grammer comedy series collaboration for Debmar Mercury. The trio is also shepherding a pilot for a docu-series on country singer Sara Evans at A&E (and they will continue to rep Evans with the Collective).

Maydew and Golenberg were part of the triumvirate that founded Collective in 2005 along with Green, who came from another management powerhouse, the Firm.

The changes reflects the growth of digital at the company, which is led by partner Reza Izad.

The rationale for getting aggressive outside the traditional realms of the entertainment business was that even though there was little immediate earnings potential, the direct-to-consumer nature of the Internet–where gatekeepers like networks and studios have yet to fully assert themselves–allowed for a greater share in long-term profits.

Collective’s growing interest in digital could also be seen as an impatience with the limitations many companies have with the traditional representation business; even talent agencies from CAA to UTA to WME are branching out into venture capital, making investments in start-ups with hopes of a payoff down the road that could ease the unpredictability of their core enterprise.

How Collective does its digital business is a twist on the traditional management model of taking a percentage of a client’s earnings. Instead, the company partners with clients on productions in exchange for offering a variety of essential services including deficit financing, technology and advertising sales.

Collective has figured out a low-cost formula for whetting consumer appetites for intellectual property online, then retaining control to that IP for a bigger payday on the more traditional platforms that are willing to relinquish rights to an already proven attraction. The company has also grown expert in exploiting that IP via touring and merchandising.

But it’s YouTube that has provided the foundation for Collective’s model, although there’s been some off-site exploitation across other platforms and apps as well.

Collective boasts a multichannel network business that generates 200 million viewers per month. While that’s still a far cry from the billion-view level that separates them from leaders in the MCN space like Maker Studios, Machinima and Fullscreen, it’s quite possible the company is looking to participate in the same rush of investment activity that has enveloped the sector in recent months.

Time Warner, Bertlesmann and Chernin Ventures are among the heavyweights that have plunked down coin for these properties with the intent of building brands that have the potential to scale to global TV networks.

Among the top properties on the Collective Digital Network include the Annoying Orange, Epic Meal Time, FreddieW and My Drunk Kitchen. While not mainstream phenomena in the conventional sense of the word, they are household names among the millennials that are increasingly slipping through the fingers of TV network yet still very much in demand to advertisers.

Madison Avenue has been getting over its traditional reluctance to associate its brands on YouTube with more and more experimentation with customized sponsorship integrations with YouTube personalities who have been aggressive about incorporating products directly into their programs in a way that hearkens back to the origins of TV.

Collective has brokered plenty of deals between these two factions including an upcoming Dodge branded integration for “Video Game High School 2,” a sequel to a hit YouTube sensation starring the firm’s client FreddieW.

Collective has scored a number of hits by taking a nontraditional path. Its first success came with comedian Katt Williams, who rose to prominence on the strength of a comedy special and DVD that was largely marketed off his website. 

Then came Lucas Cruikshank, a teenager known to the YouTube crowd as the helium-voiced Fred. After exploding on YouTube, Fred transitioned to Nickelodeon where he generated several high-rated TV movies and a series.

The most recent example of Collective’s migration strategy is The Annoying Orange, an animated fruit that has gone from a viral phenomenon to its own series on Cartoon Network. However, the cable channel simply licenses the series from Collective, which is able to sell the IP overseas as well.

Collective’s digital work isn’t restricted to amateur talent either; the firm partnered with “CSI” producer Anthony Zuiker on his own YouTube franchise, BlackboxTV.