Inside CAA, the Hollywood super agency behind Respawn, Obsidian and Turtle Rock

You can see it from down the street, taking up a block of Los Angeles' Avenue of the Stars. The valet line out front, the glass-walled atrium, the men in sport coats and women in oversized sunglasses, the reception desk off to the side where visitors wait until called upstairs. Creative Artists Agency's headquarters wasn't designed for subtlety. Often called the Death Star, its footprint alone can intimidate outsiders. It's like visiting Gattaca, says Turtle Rock Studios Co-Founder Phil Robb. Founded in 1975, CAA is one of the world's largest talent agencies, representing actors (Tom Cruise, George Clooney), directors (Steven Spielberg, James Cameron), musicians (Kanye West, Bon Jovi), athletes (Peyton Manning, Drew Brees) and others. Finding clients jobs, negotiating contracts, making deals. Over the past nearly 40 years, the company has opened offices around the world and expanded into numerous businesses. It was only a matter of time before it got into video games. In the early 2000s, CAA started finding its place in the game industry, representing some of the biggest names in the field to Hollywood studios, investors and game publishers. In March 2014, the CAA games team set up 110 meetings at the Game Developers Conference in San Francisco. Many of which resulted in nothing. At least one of which resulted in a game publishing deal. And most of which the public may not hear about for years, if ever. On the way up the elevator, a company representative says CAA rarely does interviews about itself, preferring to focus on its clients. But today the company is making an exception, inviting Polygon to its office for a look at how its game division operates — and how it has reinvented itself in recent years.

Part 1: Hollywood To understand CAA's game group in 2014, it helps to understand the group's origins. So before writing about our tour of CAA's current operations, we first tracked down those that started the group 14 years earlier. In the year 2000, CAA backed itself into a game division. The dot-com boom was at its peak. That January during the Super Bowl, ABC ran more than $40 million worth of ads from web companies like Pets.com and Computer.com. Later that year, Yahoo acquired Broadcast.com for nearly $6 billion after purchasing GeoCities for over $3 billion the year before. Telefonica bought Lycos for more than $12 billion. Money was flying around and CAA wanted a piece of it. Larry Shapiro So CAA formed a New Media division in part to capitalize on internet spending. To represent people running — or wanting to run — web companies, in much the same way it got actors roles. That's what the company was good at. It got people jobs. "This was at a time where you had Hollywood celebrity housekeepers who had ideas for dot-coms, and the celebrity would say, 'Hey, my housekeeper got this idea for a dot-com. Can you try and sell it? It could go public,'" says former CAA agent Larry Shapiro. The New Media division took a shotgun approach and, in addition to web deals, it invested in other emerging businesses. Which is where Shapiro came in. Shapiro came from a background of producing music videos, working with directors like David Fincher and Michael Bay before they made it big in film. But in the late '90s he saw business opportunities in the video game industry. He got hooked on games like Half-Life and Oddworld: Abe's Oddysee, and after working a few game industry jobs, Shapiro decided to pitch Hollywood production studios on starting game development departments. So he called a friend, Dan Adler, who happened to be setting up CAA's New Media division, to see if Adler could introduce him to people in Hollywood. Adler offered Shapiro a job instead. Shapiro accepted and became the only agent in the division to focus on games — specifically, connecting the game industry with Hollywood. "The only one I couldn't get that everyone wanted was Grand Theft Auto, of course." He began developing licensing deals, signing clients like Xbox and representing their games to Hollywood. He signed clients such as Valve, id Software and Epic in an effort to create animated TV shows using their software engines. He worked on deals for movies including Doom and Halo, the latter of which involved an elaborate pitch with six actors dressed as the game's Master Chief delivering copies of the script around Hollywood. Shapiro had mixed luck seeing film projects through to completion, but he was able to sign many big-name clients looking to break into Hollywood. "The only one I couldn't get that everyone wanted was Grand Theft Auto, of course," he says. "That was the one everyone chased." And in the middle of his attempts to connect the game industry with Hollywood, Shapiro found another way to approach the business with the help of a new recruit.

Part 2: Developers By 2003, the dot-com bubble had burst. CAA's New Media division dissipated, and Shapiro describes himself as the "last man standing." But in many ways, he was the first. Shapiro realized that he wanted to represent game developers not just to Hollywood, but to game publishers. He wanted to be the middleman to negotiate game deals with publishers, much like CAA had always done with actors and film production studios. But Shapiro was an outsider looking in. He had experience in production but not the relationships necessary to pull off his plan. "I didn't have the credibility," he says. Seamus Blackley Around the same time, a former game designer named Seamus Blackley had left Microsoft after spending four years there spearheading the creation of the Xbox. A self-described creative type who laughs at being called a businessman, Blackley wanted the console to allow developers to work on original, innovative and creative projects. He saw the Xbox as a tool that would make it easier to develop games and could therefore make games better. But while his group had done the impossible and convinced Microsoft to release a game console, Blackley was disappointed with the first games for the hardware. He realized that, as game budgets increased, the publishers and investors willing to pay for them became more conservative. As a result, developers were often no longer in control, which clashed with Blackley's vision of making it easier for them to make the games they wanted to make. "I mean it's great that there's an Xbox, and that's an awesome thing and I love it, and it's super great," he says. "But the fundamental problem that I was trying to solve, I kind of didn't solve. I didn't get there with the Xbox, because certainly at the start — with the exception of [critical darling first-person shooter] Halo — it really kind of just was another port target." So in 2002, Blackley left Microsoft wanting to find a new way to finance original, innovative and creative games. He spent time studying the film business' structured finance model, how in the '70s and '80s agents figured out how to convince investors that their top creative people were safe bets because of who they were rather than what license they were attached to. And Blackley founded Capital Entertainment Group to apply that model to games. "Which I guess in shorthand meant, you know, funding all my friends' games," he says. "I could stand wearing a suit, or I could stand having lawyer meetings for three days ... because there was a goal." In the process of reaching out to people in the entertainment industry, Blackley met Larry Shapiro. "I wanted to create this new financing entity," says Blackley. "And what happened, essentially, was that the guys who ran CAA — through Larry — said, 'Listen, you could do that here. We have done that. We were around when all of that happened. Guys working here were some of the guys who set that stuff up. And you should come work here, and we will help you to realize that dream.' And I was like, 'Ah, I've seen ... Swimming with Sharks. I can't be a Hollywood agent. Are you out of your fucking skull? Like, do you know who I am? I'm a high energy physicist, OK? I'm a jazz musician and a game designer. I have no business being there. Fuck off.' "But, you know, they wore me down." If Shapiro was an outsider looking into the game industry, Blackley was an insider looking out. "He knew every single game developer in the world," says Shapiro. "I knew that Seamus wasn't an agent agent," says Shapiro. "He didn't want to be considered an agent. That was always the rub between Seamus and I." Blackley says he hated the Hollywood aspects of the job, but he liked what he could achieve by playing that game. "I could stand wearing a suit, or I could stand having lawyer meetings for three days or I could stand having to drive to Beverly Hills and all that pretentious crap, because there was a goal," he says. Ophir Lupu With Blackley on board, CAA's game division grew. Blackley and Shapiro added more team members and turned the group into an entity of its own rather than an offshoot of another department. They made movie deals, but focused on negotiating game contracts. One of their first hires was Ophir Lupu, a former Miramax intern who had been looking for a way into the entertainment industry. He met Shapiro while trying to find a place at CAA, and decided to take a shot at games rather than film. Between Shapiro, Blackley and Lupu, CAA's game division signed dozens of popular clients, from Ratchet & Clank developer Insomniac to Metal Gear creator Hideo Kojima. They helped Double Fine find a new deal for platformer Psychonauts after Microsoft decided not to publish it. They worked with Harmonix to finance Rock Band and sell the company to MTV. They put together a deal for Resident Evil Director Shinji Mikami and No More Heroes Director Goichi Suda to publish a game with Electronic Arts. They promoted developer names as key creative talent and represented individuals as well as studios. They helped people find jobs and negotiated contracts — often using alternative financing methods — taking a cut of the proceeds and putting more negotiating power in developers' hands. "At least initially, the gratification came from feeling like we were kicking up a lot of dirt," says Lupu. "The established guard of the game business was not happy to see us. ... [We] had many doors closed in our faces. 'We'll never work with agents here, blah blah blah.' And cut to not 12 months later, making deals with those people. Those people were now coming to us asking for help on things. That's when we really started to feel like we were onto something." "At least initially, the gratification came from feeling like we were kicking up a lot of dirt." CAA wasn't the only agency working in games at the time. But CAA had high-end corporate resources, which Blackley says made a difference in helping it sign deals for original games and franchises. "The scale of the hammer that can be wielded in terms of leverage [with a company of CAA's size is much greater]," says Blackley. "... If you are the head of the games division at CAA, and [Gears of War Lead Designer] Cliff Bleszinski calls and he wants to make a $60 million game, you can call 10 different guys and sit them down with him and have serious conversations about that. And you have very serious accountants and financiers, and legal teams internally that are accustomed to dealing at that scale with projects, and the tax ramifications, international trade, all this stuff that you need to do ... You need guys in suits, and you need them to have done it before on a big scale, and it needs to work the first time and be real." Blackley points out that the attorney CAA used for most of its structured finance deals was Harold Brown, who had a long history in the field and who, back in the early '80s, set up a structured finance deal with Steven Spielberg to make E.T. "On one hand, it was all a giant conspiracy to fund novel video games," says Blackley. "... And it worked. So we started out with a few things and built from there, and we ended up doing hundreds of millions of dollars of structured finance for video games."

The transition As time went on, Shapiro, Blackley and Lupu each left CAA. For Shapiro, it happened in 2007. He cites personal issues, saying he wanted to get back to the creative side of his career. "I didn't want to be an agent forever," he says. "I came out of production. ... I like building things, and as an agent you never get your hands dirty." Shapiro joined well-funded game publisher startup Brash Entertainment, which was built to make games based on Hollywood films — in many ways, it was the inverse of his early work at CAA. For Blackley and Lupu, the end came in 2011. Blackley left first and points to stress as the main reason for his departure. "It's funny because I was such an ass, but we represented all of the top developers, more or less," says Blackley. "And at the time, I was so stressed out all the time that I couldn't enjoy it. Because I was just freaking out the whole time, you know, because every game was always canceled and everything's late, and everybody's upset all the time and blah blah blah. And it was a lot of responsibility." Respawn Entertainment's Titanfall "I think the pinnacle of it all, which was also sort of the last big thing because it, like, took the soul straight out of me, was Respawn," says Blackley. When Activision fired Infinity Ward heads Jason West and Vince Zampella in 2010, Blackley and the team at CAA guided the pair through the process of finding funding to create a new studio, Respawn Entertainment, in the middle of an ongoing lawsuit. Blackley became part of the suit. "It was incredibly painful and really frightening, and a billion-and-a-half-dollar lawsuit that's public record," says Blackley. Blackley went on to tackle a number of projects, including a startup mobile game publisher called Innovative Leisure. Approximately six months after Blackley left, Lupu departed. But unlike Blackley, Lupu didn't exit the agency business. Instead he went to one of CAA's direct competitors in the entertainment field, United Talent Agency. UTA had dabbled in the game business, and represents Electronic Arts to Hollywood for projects like the Need for Speed movie, but Lupu wanted to take CAA head on by representing developers to the game industry. "A number of factors led to me deciding to leave," says Lupu, "primary of which was the following: There comes a point where the company you work for gets really big, and at least to me it felt like CAA wanted a games division, in a word, to fill a pie chart on a capabilities presentation for the agency, as opposed to actually have a games division for the goal of representing best-in-class game creators. I didn't want to be a service area, which is what it felt like it was becoming." When Lupu left, he took many of his clients with him. That included BioShock Creative Director Ken Levine, Cliff Bleszinski, Assassin's Creed Creative Director Patrice Desilets, Deus Ex Director Warren Spector and Journey developer Thatgamecompany. "I was so happy when he did that," says Blackley. "I know it was painful for everyone, but, like, man, the two top agencies representing game creatives on equal footing with movie creatives. That's exactly how the world should be." Meanwhile, CAA was hatching its own plan.

Part 3: Teams In 2010, the year before Blackley and Lupu left, CAA hired a man named David Stelzer to join its games team. Unlike Blackley and Lupu, Stelzer came from a legal background, having worked for House of Blues, Sega and SouthPeak, putting together contracts on games like Bayonetta and Iron Man. Stelzer was a veteran of the game industry but new to the agency side of the business. Blackley remembers CAA doing a report of its business when Stelzer started: "David was like, 'Holy crap. This is amazing!' And I was like, 'Really?' Because it just kind of felt so stressful." As Stelzer got comfortable in the role, Blackley and Lupu soon departed, leaving Stelzer as the current last man standing. Derek Douglas (left) and David Stelzer (right) "There was that moment of, you know, 'Are we gonna get to go on? Are we gonna continue to be able to do this?' says Stelzer. "And we got a lot of support from the [higher ups at CAA] to kind of figure out what could work, how to do it, to go hire good people." "[Stelzer] was either the luckiest man alive or the unluckiest man in history to sort of inherit this department," says Blackley. Stelzer took over the group, bringing on agents Derek Douglas and Rocco Scandizzo to fill out the team. Douglas had been working as an agent in games for about eight years, first at CAA entertainment competitor William Morris Agency, then at boutique game industry agency Digital Development Management. Much like how Lupu took clients with him when he left CAA, Douglas took clients including Obsidian and Turtle Rock with him when he left DDM. Scandizzo had grown up in Italy and moved to the U.S. to work in marketing and business development before joining another independent game industry agency. Together, Stelzer, Douglas and Scandizzo designed a new plan for CAA, one that pulled from each of their backgrounds, and the one that they invited Polygon to their office to explain. They decided to continue representing game developers to the game industry, but to focus on representing teams rather than individual people — save for a few exceptions along the way. It's a strategy Douglas finds familiar from his time at DDM, though with a heavier focus on connecting clients to other parts of CAA's business. DDM's strategy, according to Founder Jeff Hilbert, has always been to represent teams rather than individuals because of the return on investment. "At the end of the day we get paid on commission, so it's pretty straightforward," Hilbert says. Stelzer says the shift toward teams came both because of a change in the market in recent years, and because of his team's personal views on a better way to approach the job. "[Stelzer] was either the luckiest man alive or the unluckiest man in history to sort of inherit this department." "At the height of the last console cycle, [there were] tons of Xboxes in the market, tons of PS3s in the market, and you really had these people that were rock stars that you could build something around," he says. "And they could kind of command a good price to be able to do what they wanted to, or the demand was there from a lot of places to take them on." He points to Respawn as an example, where in 2010 CAA built a deal around the strength of Jason West and Vince Zampella's names, even before a specific product was on the table. "I think that, as we got closer to the new console cycle [with Wii U, Xbox One and PlayStation 4], then everybody kind of backed off a little bit on their bigger bets and [brought] a lot of the franchises to the forefront where they were making everything in-house," says Stelzer. Asked if CAA's direction is a response to Lupu taking many of CAA's biggest-name individual clients, people like Ken Levine and Cliff Bleszinski, Stelzer says that's not the case. "Every one of those clients who's with Ophir, that's a relationship that they have there; they get along really well, and for what they're doing together he's probably the best person for them," says Stelzer. "The rest of the clients, which was about two-thirds of our list, ended up staying here, where they believed in what we were doing and that we had the best approach. And we bump up against each other in friendly competition from time to time, but ... we think that we have a better approach that we would have moved toward anyway." [Lupu disputes Stelzer's estimate of Lupu taking one-third of CAA's clients, saying, "I would peg it more at two-thirds, maybe even more than that."] The new CAA In a meeting room in CAA's headquarters — surrounded by four solid walls for privacy — Stelzer explains his team's new approach firsthand. Stelzer says that in addition to representing teams, CAA works with a handful of individual clients, often ones that cross over with Hollywood. He cites client Christian Cantamessa as an example. Cantamessa worked as a lead designer on Rockstar's Red Dead Redemption, has done a number of contract game writing and story direction jobs and has long wanted to break into filmmaking. Recently, he wrote a film script with a partner; CAA's games team passed it to the company's film division, then Cantamessa met CAA client and The Walking Dead writer Robert Kirkman, who agreed to produce the film. During Polygon's visit to CAA, Cantamessa was on set directing the sci-fi thriller film, Air, in Vancouver. "They're really good about staying in good graces with a lot of the publishers." Stelzer says CAA's approach isn't one size fits all. "We work with companies that don't necessarily fit into the company structure of what we do either," he says, pointing to outsourced artwork opportunities. And even within the teams approach, not all teams are looking for the same things, says Stelzer. Some may be new to the industry and want to meet a lot of people and make connections. Others may be veterans using an agent in place of someone on staff to do business development due to CAA's ability to see all the deals happening in the market at any given time. Stelzer declines to comment on what fees CAA takes, but says the company typically looks for long-term arrangements that last beyond a single project. "I don't think it's interesting for the amount of work that gets put in by both sides to then have to go off and forge different relationships with people," he says. With that in mind, Stelzer says that industry conference D.I.C.E. in February marks the start of "selling season," where he and his team guide clients between meetings with publishers and investors. Shaking hands, making small talk, briefly showing games. Three One Zero's Adrift At this year's event, CAA client Three One Zero brought its space adventure game Adrift to pitch for the first time. Stelzer estimates the development team demonstrated the game about 30 times to interested parties, then showed it another 30 times after D.I.C.E. ended. Just over a month later at the Game Developers Conference, the team signed a deal for the project with publisher 505 Games. Stelzer says that usually things don't happen quite that quickly — show a game at one conference, sign it at the next — and that an average deal takes three to six months to close, with the longest taking just over a year. A lot of the work he and Douglas do involves planning ahead with proper market forecasting and relationships to anticipate the likelihood of projects landing within certain time frames. (Following Polygon's visit, Scandizzo left CAA to help start a game development division of production company Psyop.) As it turned out, GDC marked the end of a successful month for CAA. In late February, news hit that Warner Bros. acquired the rights to make a Minecraft movie, a deal negotiated by CAA. In early March, South Park: The Stick of Truth shipped, developed by CAA client Obsidian. One week later, Titanfall shipped, developed by Respawn Entertainment, which stayed with CAA following Lupu's departure. In general, CAA clients praise the team's relationships and ongoing support as two of the main reasons they like working with Stelzer and Douglas. Turtle Rock's Phil Robb says that for his team's multiplayer shooter Evolve, Derek Douglas has been working with them since the game was an idea on paper. Douglas helped mold the pitch, sign the game with two different publishers, playtest and assist with documentation along the way. Three years of daily contact, more or less, rather than setting up a contract and stepping aside. Turtle Rock Studios' Evolve Robb says that stands in sharp contrast to an agent he met years earlier, who turned him off to the idea of agents in general. "He was sort of what we imagined an agent being," he says. "Kind of slick shit. We didn't like him." But when Robb later met Douglas at CAA, he appreciated that Douglas was soft-spoken and made them feel confident about the business. Three One Zero Co-Founder Adam Orth tells a similar story. In 2008 during the Blackley and Lupu era, Orth signed with CAA as an individual looking for a job. He says he liked the agents assigned to him, but didn't like the process — they found him a job and left him alone and continued to take a cut of each paycheck. "They were really great, but the organization above them was not," says Orth. "And I didn't feel like they had the best intentions of people that they were representing in mind. ... I felt like maybe the reason why people had a bad taste in their mouth for agents in the industry [was] because the people at the top weren't really [interested in] the career of anyone who wasn't on the Will Wright level." Orth says his perception changed with the new era of CAA when he started talking to Stelzer in 2013. Stelzer impressed him by saying he didn't want to sign a contract upfront, and spent roughly six months working for Three One Zero before signing any paperwork. "That made us feel like it wasn't just a cash grab," says Orth. "It was a real relationship where they cared about us." Obsidian Entertainment's South Park: The Stick of Truth Obsidian CEO Feargus Urquhart also points to CAA's relationships with game publishers. Unlike Robb and Orth, Urquhart has a long history in game publishing, having handled much of Obsidian's contracts and negotiations for the past 11 years. But Urquhart says, as the business became more complicated over the past decade, he realized he either needed to hire someone to run business development for the company or hire an agency, and he decided to work with Douglas. Urquhart says he doesn't need introductions to publishers like agents often supply, but he relies a lot on CAA to inform him of available work he might not hear about otherwise and to serve as a barrier between him and publishers who might be more willing to speak openly with Douglas than they are with Urquhart directly. "They're really good about staying in good graces with a lot of the publishers," he says. "And to be honest, they're friends with a lot of people at publishers. And so that kind of helps find out what's going on and what's available and things like that, which I think is really important. ... "[And] because [Douglas] is third-party in a way, publishers are going to ... not [be] as worried about offending him as they're worried about maybe offending me if I'm on the phone, so they can have maybe more honest conversations."