How Marvel Survived Certain Doom

conclusion of Marvel on the Brink. Hey, I'm Jonathan Strickland and I'm arial casting, So full disclosure, we're doing this as if we decided to do it two part on Marvel, but in reality, we recorded a super long episode on Marvel. There was way too long for a single episode, but it was all important because comic books and Marvel and DC have had a roller coaster of a ride. Yeah, They've gone from being this really obscure type of art form that people were ashamed to even admit that they enjoyed.

The ones who loved it unabashedly were looked on as outcasts and now their mainstream baby. But we're going to talk about how that all happened in this episode. Yeah, so let's look at where we left off. Marvel had just been sold to a company, So what happens next? So next in New World Pictures, which had bought Marvel, had suffered three years of losses after buying Marvel, and so they sold again to mc andrews and Forbes Group. So so we went from Marvel getting sold to Marvel

getting sold. Yes, yeah, just three years later. Now, mc andrews and Forbes was owned largely by Ronald Perelman, not ron Pearlman, just Twoges. But Ronald Perelman is a different person. Yeah, he was a multi millionaire investor. He also owned Red Lawn as a part of mc andrews and Forbes, and he bought Marvel for eighty two point five million dollars. So whereas New World had bought it for forty six million, they were able to sell it for eighty two and

a half million. So so it's not we're not seeing a reversal unfortunately. Yeah. Yeah, So then Perelman decides that he wants to turn Marvel into a publicly traded company, not a privately owned one. So they start selling stocks and think about the company. Yeah, like and it was. The more you read about Perelman and his business proceedings, the more you figure some of this seems pretty questionable. He wanted people to invest, he wanted people to think

they were in control, but he didn't want to lose control. Yeah, that would become a big problem. He wanted to have his cake and eat it too. Yes, so we start seeing interesting moves here. One of the other things that Perelman would do is he bought some stock in a different company called toy Biz and uh. He also didn't hold on to all of the properties that Marvel had. He sold some of those off, including Marvel Productions, the

the Animation Studio. He sold the back catalog for Marvel Productions to another company to Saban, who was then later bought by Disney, who then later bought Marvel. So you know, Circle of Life reunited and feels so good. Yeah, but the close Animation Studio and decided to outsource their cartoons instead of making them in and then into Pearlman also acquired Fleair and I believe also sky Boxing Panini card companies.

I know, at least Flair. I know they also distributed cards through sky Box and Panini, but I don't know if it was the same year. That's those details are a little bit fluid. And they bought it to distribute Marvel Trading cards, of which my husband owns a lot a lot of Marvel Trading cards. In ninety three they started up Marvel Films. But this was also right at the beginning of another major dip in comic book sales. It was an industry slump. This was a real problem.

So Perelman had sold the company, not literally, but he had sold the idea of the company to shareholders with this promise for an incredible and return on their investment. He was able to do that in a way that was a little questionable. So what he essentially did was he started creating a bunch of special edition type comic books, and he was essentially selling the same title of comic book multiple times to the same people by creating different

collectors editions. And because older comic books had become incredibly valuable, they were collectors items. Now, the idea was, hey, if you buy these comic books because these are limited runs or collectors editions, and a few years they're going to be worth way more than what they're worth right now, which and he could also up the prices on the

comics now it hopes for a better return on investment later. Yeah, So what he's doing is he's telling the collectors, I bet you all wish you had an issue of Action Comics number one with Superman holding the car over his head, because you would all be, you know, multimillionaires if you just had those old comics. Well, here's your chance to get in on the ground floor by all these comics, and in a few years you can sell them off

for a huge profit. So that's how he that's how he's selling it to the customers, and that in turn is what's driving the investor's interests and the fact that he's telling them, we're gonna just keep doing this. We're gonna make this bigger and bigger and bigger. You guys are gonna make huge amounts of money on your investment, so make sure you buy more stocks. And then he doubles down because he bought Sharon toy Biz, he has some start selling action figures of these characters that people

are collecting. So now you've got the collector comics and you've got the collectible action figures. Yeah. And it's interesting because right around this same time, Neil Gaiman, the famed author who would end up actually being he's also a comic book writer. He's written on several comic books, including like Sandman, some of the Marvel comics as well. He actually talked to some retailers and he said, this is a bubble that you're you know, you're inflating a bubble,

and eventually this is going to burst. It's not sustainable. It's like the tulip craze from the seventeenth century. Those tulips. People were speculating in them and buying up more and more tulips and it just was a crazy This is a true story. This really did happen, and that ultimately when the market crashed, you had people had warehouses full of tulips that just would rot away because no one

wanted them anymore. It was everyone thought everyone was going to want them, and that's what led to the buying. He said, the same thing is going to happen with comic books. And this was as it turns out, he was spot on the money. You would take a few years for that to really come to fruition, but he was he was absolutely right. Yeah, but you know, you start to see that turn in ninety three, Marvel starts trying to gain some other markets, so they start like

seeing out their characters around this time. Yeah, they also, uh, well, a movie company made a Fantastic Four film, yes, but didn't get released. It was produced by Roger Corman. It was an amazing movie. I actually, really, on ironically, genuinely love this unreleased Fantastic Four movie. You can find bootlegs of it. I'm sure it's even on YouTube at this point.

You know, I don't know. I watched it on an old VHS I got off a bootleg DVD, and it's it's like the nineteen sixty Batman TV show meets The Music Man meets Days of Our Lives. It's fantastic. It's very it's definitely very low budget, but I feel like they nailed the spirit of the comic book, whereas I would argue the later Fantastic Four films failed to do that. I, in my personal opinion, it is the best Fantastic Four

movie there has been, I agree to date. Now, now our listeners are going to go and seek this out and watch it, They're gonna be think why are you thinking these effects all credibility? In ninety four, they buy Heroes World as a distributor for their exclusive use by They were really starting to feel a crunch. They were. They owed a lot of money to a lot of different companies. I mean they owed one point seven million

to Disney. Yeah, and by nine this would mean that the company, in order to remain a company, was going to have to make some major cutbacks and that included laying off a third of the people working for the company. Yeah. That's about a hundred and fifteen people, which doesn't seem huge, but it is a third of the company. Yeah. So then we get into a corporate battle in Marvel. This is this is like the corporate version of a massive

slug fest in a Marvel comic book. I would say Perelman buying Marvel was the start of their brink, but this is the true brink moment. Yeah. So he sees the need to restructure the company in order to make

it profitable. But he's made all these promises to stockholders that and the stockholders are a little irritated more than a lawyers, and the things have not gone as planned, So it would become kind of a battle between him and another major shareholder, someone that we talked about occasionally on this show because he's had his hand in numerous

major corporate upheavals, and that would be Carl Icon. Carl Icon owned a significant number of shares of Marvel and so they often call him an activist investor because he uses his shares to influence the actual inner workings of corporations.

So you had kind of a power struggle between Perelman and Icon, and you meanwhile also had other entities involved, not just Marvel, but toy Biz because Perelman wanted to get even more control of toy He wanted to buy up the remaining like he wanted to buy outright toy Biz, so everything that he didn't currently own in them, And he was thinking of merging Marvel and toy Biz together

in order to make Marvel of more sustainable, uh stable company. Yeah, But then he wanted to keep like most of that stock for himself, Like he wanted to fund the buy so that he was like more of a majority owner despite the fact that he was a public group, and then just leave the old stock to the shareholders. And that's rightned the value of their stocks. Yeah, to the point where they saw a massive drop in stock price.

And by massive drop I mean nearly thirty six dollars per share down to less than two dollars fifty cents per share. That's a that's a monumental drop. Yeah, and so and so they said, no, no, perimn we don't We're not gonna, We're not going to agree to this. And he said, fine, I'm gonna file for chapter eleven and then I don't need your permission yep, which is

exactly why he diddy. We filed for bankruptcy protection and they underwent another restructuring plan and secured funding from the The Andrews Group, which is an investment firm three and sixty five million. And this would allow them to help poff creditors and to continue working on making the business profitable. Yeah.

They figured they would be out of bankruptcy by the middle They knew that to keep Marvel on track, they just needed to resolve all their issues as fast as possible because the market is ever changing and you don't want to have to play more catchup than you have to. Yeah. And so this leads up to seven, where you have the kind of the massive conclusion between the Icon and Perilman fight because I was still going during this whole process. So they're both struggling for control of the company. So

who wins neither of them. Yeah, toy Bis wins. Yeah, toy Biz, owned by Isaac pearl Mutter and A Manly, got the ownership. They booted Perilman, they booted Icon, They booted the CEO of Marvel at the time, Scott Sassa, who had only been in that position for eight months. Yeah, I feel like he kind of got largely caught in the cross. I think I think it was in a really tough position, like just you can't really blame Marvel's struggles on the CEO at that time. He didn't even

really have the time to get a handle on. Yes, And they named Joseph Calamari the new CEO of Marvel. That's such a great name. Yeah. And so it's interesting, you know, Ared and pearl Mutter had both been on the board of directors for Marvel already because of these previous business dealings between toy Bus and Marvel, and this would be the mark of what would allow Marvel to

return from the brink. Yeah, this is this is truly the turning point is this change in leadership where the two super heroes who were slugging it out like this is when Captain America and Iron Man are both fighting each other and yeah, and and it turns out they knock each other out and Squirrel Girl comes up and she takes over. She is the most powerful. It is true she can take on Galactus. But that again, that's a tangent. And you know what we're gonna talk about

how this new leadership was able to rescue Marvel. We have more to say about Marvel, but first let's take a quick break, all right. So it took a little longer than Marvel wanted, but they were back at of bankruptcy, still struggling, but in a better position than they were in.

They started expanding their offerings beyond comic books so that the next comic books slump wouldn't hit them as hard, right, so that if it turns out that these are cyclical, like let's say that's every generation there's a high point and a low point, that those low points don't wipe out the business. Yeah, and you know we said that Pearl Letter and Rod had been on the board before Joseph Kelley Murray had a hand in running Marvel prior

to being named the CEO. In so much like staying with people who had helped make the company successful in the past, they decided that they really needed to stay true to the core concepts of Marvel, the heroes and the ideals that made them successful in the first place. Taking these and moving them into the modern marketplace is what would make them successful. It's not new characters, right, It's not like taking your most iconic character and making

that iconic character a dark antihero. And that iconic character had been such a glowing bastion of goodness up to that point. Superman. I mean, you've you've got evil versions of Superman like Bizarro, but you already have them, alright. But they also had some ideas that were not so great.

They thought they were going to make some well. They did make some themed restaurants and video games and trading card initiatives, and like the restaurant marvel Mania was only around for about a year or so, and the other ones were so so. Marvel video games are hit or miss, like I like them, but some of them are good, like It's some of the more recently, the most recent Spireman game is one of the best games ever. It's

a great one PS four game. The But they also were responding to changes in technology, right, and you started to see them embrace the concept of digital comics, and they start creating apps and making their titles available for digital download, which appealed to people who wanted the comics for the stories, but they weren't necessarily interested in actually collecting physical comic books and then storing them and all that kind of stuff. Well, and they also worked to

expand their characters more into the cinematic universe. Instead of just licensing out their characters for a movie here or a movie there, they started just selling the rights to their characters outright to studios. Yeah, this is what has led to what a lot of people are upset about today, is that they don't all belong to Marvel Cinematic or Marvel Studios. Well, it's it's because in Abvis kind of oversaw this. They would try to write a movie and

sell it to a studio. But when a studio is looking at a ton of movies at a time, it's hard to get yours seen, especially if HER's as a superhero movie. When previous superhero movies have been questionable quality. I mean apart from things like say the Tim Burton Batman films or the Night Superman film. Yeah, there there were a lot of failures, like that Captain America movie. Anyhow,

Salinger's Kids, Yeah, it's it's not great. They sold some of their i would say most profitable characters at that time spider Man to Sony X Men to Fox. Now, they also sold Daredevil to Fox, which was a Golden age hero but not as popular in the public eye. And they also sold Blade to New Line Cinemas. And this is important because when these companies did make these

movies with these characters, they were successful. Blade made seventy million dollars, and because Marvel had kind of sold the right and they only got a little bit of the profits from licensing out the rights, they got about two of that. Yeah, so while it was a profitable move, it wasn't breaking in huge amounts of money. Meanwhile, they were still breaking in some licensing profits from their other efforts,

like through toys and merchandise. Yeah. And then in two thousand three we get a huge change that would put Marvel in prime position, and that was when David Mazel would go to Arad and Paul Motter and say, you know what you guys need to do. You need to make your own movie studio. You need to make your own movies. Don't license your characters to these other movie companies. Keep all your profits. Yeah, if you do all the work, you get to keep all the Money's you just got

to make sure your movies are good. That's all you gotta do. It's easy. Two years later, the Marvel board improved that plan and they got a loan from Meryll Lynch. Yeah, a small loan of half a billion dollars billion dollars

for a seven year span. But to get it, they had to put up for collateral ten of their characters and properties, so Captain Mary, the Avengers, Nick Fury, Black Panther, ant Man Cloaken, Dagger, Doctor Strange, Hawkeye, the power Pack who I don't I'm not familiar with in shang Chi, which meant that if this movie push was not successful, if they could not pay back that loan, yeah, then they wouldn't have the rights to any of their most

popular character and the bank would own them. Yeah yeah, yikes. But first, let's take another quick break to thank our sponsor, so um they knew they couldn't go out and launch a film with the X Men or with Spider Man. They did not hold those movie rights, so they were limited in which characters they could put forward. So they had to start making tough decisions about what what was

going to be their first attempt. Now, hilariously, they settled on iron Man because he had been poppler to comic viewers and they figured they could adjust him and make him popular to the general public as well. But if you listened to the list of the characters that were collateral, iron Man wasn't in that list. He was licensed to New Line Cinema, and then their option on him ran out two months after the bank deal closed, and Marble said, oh, we're going to do a movie on iron Man. This

is great. He's a golden nagu here o. He's he's popular with our readers. But because he wasn't a part of their their deal, they had to fund that movie themselves. So they start working on that, and at the same time they really concentrate on getting into the digital comics in a big way. In two thousand and seven, and the iron Man project, as you may be aware, was successful. It was. It ended up bringing in five eight five

million dollars at the box office. That's that's revenue, not necessarily profit, but five million, and they took out a loan for five hundred and twenty five million, So with one movie they proved that they could at least get a revenue that was equal to the loan that they had secured. And Kevin Fiegi would become the president of production for Marvel. Now, he had been the producer for several Marvel films, not just Marvel Cinema films or Marvel

Studio films. He was the producer on Fox's X Men, He was the producer on Sony's Spider Man, which are both great movies, they are, and he was also the producer for the Marvel Studios film Iron Man. And once that was such a monumental success, Marvel said, we should put this guy in charge of everything, and that is what set the stage for Marvel to get eyed by the Mouse House. Yes, in two thousand nine, Disney bought Marvel for four billion dollars. You're probably familiar with that.

It made a lot of news. Yeah, it was like the estimates tend to go between four billion and four point three billion. It all depends on how you measure it, but either way, everyone thought, this is a company that sold for eighty two and a half million dollars a couple of decades earlier, that was in bankruptcy a decade earlier, and now is being bought by Disney, the global powerhouse

of a company, for four billion dollars. And beyond that, Disney has the power to try to get back some of those iconic characters that Marvel didn't have rights to, So they made a deal with Sony in two thousand fifteen to share Spider Man between studios and ma'am I

love it. Oh yeah, no, that's that. Spider Man Homecoming is a great movistic fantastic And in two thousand eighteen, last year as of recording this episode, Disney bought Fox for seventy one point three billion dollars, which is opening up discussions to X Men crossover and bringing X Men

under the Marvel Studios umbrella. So the the great story here, I think is that this comic book company took a huge risk in following the advice of Masal and creating a movie studio of its own when that was not its business before, and yet was able to leverage that but one partly because I mean, they knew those characters, they knew what resonated with fans, and they were able to take those traits that resonate with fans and then to adapt them because they Any comic book fan will

tell you the movie versions are not exactly the same as the comic book versions, but most of those changes were made in an effort to appeal to a mainstream audience that isn't familiar with these characters backward and forward, and I think for the most part it works too. So an enormous success. And this year is a special year for Marvel. Yep. This year, two thousand, Marvel is

hitting its eightied anniversary. They've got a whole bunch of really big plans to celebrate it, reimagining characters, doing stuff on social media, including a bi weekly animated series called Today in Marvel History, a bunch of stuff over all of their venues. You can go to Marvel com to learn about it, specifically Marvel dot com, slash Marvel eighty, or you can look for hashtag Marvel eight because there's

a ton of big stuff. Yeah, they're well, well, the company has definitely more than bounced back, especially now this

part of Disney. That's not to say that every decision that has been made has been met with universal approval, and some of the decisions which I really like, a lot of the hardcore traditional fans have reacted poorly to things like Iron Man and the rise of Iron Man's protege, or Miles Morales taking on the role of Spider Man, or for becoming a woman, Like, there are a lot of different things that actually I think are great changes for the overall storyline and especially when it comes to

representation and diversity, But fans get fickle, especially like the hardcore ones who resist any change, Like they it's so weird because on the one part, they want it citing news stories. On the other part, if you go away from anything they think of as being important to the character, then you are betraying them. Yeah, Captain America becoming a part of Hydra Okay, yeah, but that we're not going to go into that anyhow. That's yeah, that's another episode.

So the company is doing quite well, at least cinematically, where we've seen some other changes recently, Like there were several Marvel properties that were Netflix series that have recently been canceled, and while that hasn't been necessarily divulged publicly, the general speculation is that these are properties that will probably resurface on Disney's own streaming service once it launched

Gosh I hope. So the conflict there is that Netflix would own the old seasons of it and Disney would own the new and so these competitors would then have to kind of work together. So we'll see how that turns out, and maybe we'll cover in a future episode. But this was a fun one for us to look at because it's again hard to imagine when you're living in a world where Marvel is running so crazy popular

at the box office. It's just every every year you're hearing about another billion dollar film like Black Panther or Avengers Infinity War. We've got Avengers Endgame. You know, you hear about those things, and it's hard to imagine that this was a company that, again, just a couple of decades ago, could have gone out of business. But I think by staying true to the stuff they had created, by being flexible to try and get their content to people in the different ways that people want to access it,

they were able to turn all that around. That I think is a valuable lesson for lots of people that you cannot get so married to a specific way of doing business, nor can you drift too far from your core values without endangering the entire business. And Marvel I think it's proof of that. I would agree, Well, that was fun and uh, I look forward to revisiting this and maybe we'll do an episode about d C and I can go on a rant about the movies and Arian Ariel can leave the room for a good This

was a long episode that one will be forever. Yeah, but we'll touch on that in a different time. If you guys have any suggestions, where can they reach out to us arial, Well, they can reach out to us at feedback at the Brink Podcast dot show, and you can check out the Brink podcast dot show website that has all of our episodes on it. A little bit more about us if you want to learn more about what makes us tick. And we look forward to talking to you again. I have been Jonathan Strickland and I

have been aerial casting Excelsior. The Brink is a production of I Heart Radio and How Stuff Works. For more podcasts for My Heart Radio visit the I heart Radio app, Apple podcasts, or wherever you listen to your favorite shows. The bad