This episode of The Startup Story features Larry Namer, founder of E! Entertainment Television. When you think of E!, you may instantly think of the show, Keeping Up with the Kardashians. Now for the record, Larry had nothing to do with the Kardashians phenomenon. He did, however, have everything to do with the building of this media network giant, which eventually sold for approximately $3,000,000,000 in 2007.
This episode of The Startup Story features Larry Namer, founder of E! Entertainment Television. When you think of E!, you may instantly think of the show, Keeping Up with the Kardashians. Now for the record, Larry had nothing to do with the Kardashians phenomenon. He did, however, have everything to do with the building of this media network giant, which eventually sold for approximately $3,000,000,000 in 2007.
In this episode, you will learn how Larry maneuvered the early days of his startup and how he built his company with little to no funding. Larry also shares openly about how he constantly adapted his business to ensure success, regardless of the external circumstances he faced. Wherever you in your entrepreneurial journey, Larry's story will provide you with a fresh perspective to take into your own endeavors.
Special Guest: Larry Namer.
The Startup Story - Larry Namer
Larry Namer: Hi. This is Larry Namer, founder of E! Entertainment Television, and this is MY startup story.
James McKinney: Every wildfire began with a spark. Every superhero has an origin story. And every single startup has a moment that they point to as their beginning. And every founder has a purpose that drove them in the midst of all obstacles. THAT is The Startup Story.
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James McKinney: Your age will probably determine what shows come to mind when you think of E! Entertainment Television. If you're 35 years or older, like myself, you'll probably think of the hilarious show Talk Soup with Greg Kinnear and Joe McHale, a television show that mocked, well, other television shows. If you're under the age of 30, you might think of Keeping up with the Kardashians. Either way, E! Entertainment Television has a v significant audience draw across the cable platforms.
This episode of The Startup Story features Larry Namer, the founder of E! Entertainment Television. For the record, Larry had nothing to do with the Kardashian phenomenon that has taken over pop culture today. He did, however, have everything to do with the building of a media network in the mid 1980s that eventually sold for approximately $3 billion in 2007. At first glance, you might be thinking cable was so new in the mid 80s, it's just a matter of capitalizing on time and history. Well, there may be some validity to that thinking, E!'s startup story is about Larry's conviction that there was no way he was going to let E! Fail.
In this episode, you will learn how Larry maneuvered the early days of E! With only $60 remaining in his bank account. You'll learn how he built his company with only raising 3% of the money he tried three years to raise. You'll also hear how he learned to constantly adapt his business to ensure success, regardless of the external circumstances he faced.
Wherever you are at in your entrepreneurial journey, Larry's story will speak to you directly and provide you with a fresh perspective to take into your endeavors. If you don't believe me, let me just start by saying that Larry's story does not begin on the glamorous side of Hollywood. In fact, Larry's startup story begins in the sewers of Manhattan, new York.
Larry Namer: Somebody I knew's dad was an electrician in New York, and said, "Oh, my father, he's part of the electricians union. They just organized this thing called cable television. I'm not quite sure what it is, but we can probably get you an interview." So I did get an interview at a company called Sterling Manhattan, the precursor to Manhattan Cable, which was the precursor to Time Inc. cable. So I got a job there. I think I lied. I think I put down that I had no education, because I needed the job. So they gave me a job being an assistant splicer underground, which meant I worked in the sewers of Manhattan-
James McKinney: Oh my God.
Larry Namer: Where I would literally, at 8:30 in the morning, I would go do in the sewer and I'd splice cables together for what eventually became the cable system that powered all of Manhattan. But it was a great time to be there. The company, while nobody knew it or what it was at the beginning, Time Inc. came in a year after I joined and they bought the company. So Time Inc. at that point was a magazine company and was very interesting because you had all these the Yale and the Harvard guys sitting up 6th Avenue, and a lot of them trying to figure out what it is those guys in the sewers do.
Then eventually, somebody in Human Resources said, "Wait a second, there's a guy with an economics degree that does that." So I kind of became the de facto translator between the tech guys, who very rarely even had a high school diploma, and Harvard and Yalees and stuff like that. So it was a great time to be there because Time Inc. decided that over 10 years, this is kind of like '71 to '81, that they were going to migrate their company from being a printing company to becoming a media company.
James McKinney: Oh, interesting.
Larry Namer: And actually the study that was done was done jointly with IBM, which IBM read the study and poo pooed it and said, "Ah, ridiculous." But Time Inc. decided they were going to make the transformation, and it was a great time because it was the beginning of big city cable systems. While I was there we built Manhattan which was the first underground big city system that was really dependent more on programming, where the rural systems were all on telephone poles to bring people television where they never had it before. Then programming. 1973 a guy named Jerry Levin came in there and oh who's there, but he kind of rose and said, "I heard about these things called satellites. I think we're going to start putting movies on them," and we were going, "Really Jerry? What's a satellite?" So that was the beginning of HBO, and then we did Cinemax. So a lot of things came out of that group in that 10 years. A lot of innovation. So it was a great place to be because I got to do stuff really young that most people in the Time Inc. family didn't get to do until they were in their fifties.
James McKinney: So you were a part of the early days of HBO.
Larry Namer: Yeah, I was there. I was part of what was known as the Time Inc. video group and we all helped each other. So I was on the cable operations side, but HBO at one point was in the same offices and stuff. It was kind of incubated there and we crossed over and did a lot of stuff. It was kind of there I started becoming a little bit fascinated in the programming side because I would see all this exciting stuff. I'd go, "Gee, that's a lot more interesting than working with the rats in the sewers."
James McKinney: So while you were in the sewers, though, what were you thinking your, because I'm assuming you didn't have any entrepreneurial endeavors while you were in the sewers, right? Was your mindset just kind of climb the ranks? What were you thinking in the sewers?
Larry Namer: My mindset, well at first my mindset was just this is a nice temp job, can't wait to get out of there. But then I think when Time Inc. came in and I started to say, "Hey, wait a second. This has got possibilities here and this could be exciting, and this could be a big company." It really was focused much more on being able to climb the ranks. I did climb rather quickly there. I think I was 23 when I was on the union side. I think I was 23 when they put me as the vice chairman of the division of the union, simply because I knew how to read. I could actually read contracts and stuff like that, so I represented literally thousands of cable workers in the union thing, which was just bizarre. But then the management guys wanted me to move over to management which at first I refused, but then they lured me over. I saw the opportunity to rise. I think at that point my aspiration was to maybe one day become a vice president of the company and stuff. Then after, I look back and go, "Really? I once wanted to be that?" Because I think at some point I kind of passed that.
James McKinney: Do you think just to kind of stay in that moment for a minute there when you had aspirations of being a VP, do you think a lot of that mindset was related to your upbringing? Your parents had stable jobs. Were they first generation US?
Larry Namer: Yeah, they were first. It was definitely that. My family's aspiration for me was get a civil service job and be able to retire with a pension and stuff like that, so there was no thoughts of being an entrepreneur whatsoever. It was just rising up in the corporate ranks that they were supportive of that. They were thinking you should work for the city, and you're more guaranteed, what's this cable thing and how do we know it will be around tomorrow? But I kind of knew that this cable thing was not going away, and it was going to be big and stuff. So I just stuck with it for 10 years.
James McKinney: So when you were at Time and you're getting this experience with HBO, if I'm not mistaken you actually on the HBO side, you were integral in the expansion of that whole business unit, weren't you?
Larry Namer: I eventually, and again this is kind of fun because I was really young when I got to do all this stuff. I was 25, they made me the director of operation-
James McKinney: Oh my goodness.
Larry Namer: … which I had like 300 and some odd people. Lot of technical people. Engineers and I mean like real engineers and stuff reporting to me. Then having to go read books to find out what the pp that work for me do, which I did. I just started reading books. Then they made me the head of corporate development, which was finding out things… figuring out businesses that we could build on the back of the cable system that were non entertainment. So even way back then, I was doing remote data things. We were running special cables throughout Manhattan so that a bank uptown could talk to a bank downtown. Their computers could talk to each other.
James McKinney: Oh so you, because you had the infrastructure, you were part of the driving force for monetizing that infrastructure.
Larry Namer: That was exactly it, and over a short period of time. So we were saying banks could talk to each other on, at that point with T1 circuits which were unheard of. You're talking '79. Very quickly, it actually became the number one source of profits for the cable system, because the margins were much, much bigger. I mean you charge somebody $12 for a cable hookup, but you could charge a bank $1200 for hooking up one computer to the other on essentially the same kind of bandwidth, so it was a much, much more efficient use. It was basically all about finding efficient uses of bandwidth.
James McKinney: Yeah. So as you're with Time, you're climbing the ranks. You're doing incredible things. Now, looking back, a part of the early days of some incredible opportunities. When did the idea start percolating about doing something on your own?
Larry Namer: What happened was I hit the 10 year, where you qualify for the pension. You're 30 years old, you go wait a second. It was kind of then I'm going, "Really? 30 years old and I'm qualifying for a pension? I'm not sure this is where I'm supposed to be." But as a true New Yorker, never thought of… I moved to Manhattan which was the aspiration of every kid from Brooklyn at that point. But then somebody called me to recruit me to come to a cable system in Los Angeles, but it actually wasn't a cable system. It was a company that won the cable franchise, and nothing was built here. So basically, all they did was they had a piece of paper from the city of LA saying you now have the right to build the San Fernando Valley. They had a bank commitment from Toronto Dominion, and they needed someone to come and build it. While there were cable systems all around the country, city of Los Angeles when they wrote the franchise, insisted that the cables go underground, not on telephone poles.
So this company had to find someone who knew how to build underground. Well, at that point only Manhattan Cable was built, and I was the only one who knew how to build underground. I got called. I first refused I think two or three times. I said, "Listen, I'm a New Yorker. I'm not moving to California." But then they convinced me to come out for a weekend and pitch me and stuff like that. They said, "What would it take for you to move here?" I named like four times what I was making in New York, and they said I was out of my mind. I said, "Yes, you're probably right. But your question was what would it take, and I told you what it would take. I'm not looking to make a lateral move. I'm really find in New York and I've got a great new apartment in the city."
I went back to New York and it was like one of those winter days. There was snow on the ground and it was like second day. And second day snow in New York gets black, it's not white. I'm standing there wearing my suit while I'm walking to work. Cab goes by and splashes like black wet cold slush all over me, and I just said, "Really? Did I really refuse that job?" It was like two days later. The guy called again and said, "Listen. What you asked for is outrageous, but okay." I was like, "Really?"
James McKinney: That's awesome. I love that.
Larry Namer: And he said, "Yeah. How fast can you be here?" I said, "Well, two weeks I guess." I literally walked in, quit that day, packed up my stuff, and came out to California to build what's now Valley Cable, which was the first 61 channel two-way cable system ever built. For me, it was a great opportunity because now I moved totally out of the operations side. Then I now had finance and marketing and programming. Literally everything. I was the general manager so everything reported to me. So I got fascinated with all the other stuff, and I kept thinking, "Hey, maybe there should be this. Maybe there should be that." Then what happened was the company I had worked for decided to sell out and move back to Canada. I said, "I didn't move from New York to LA, to go to Toronto." So I had left there. Friend of mine and I were just kicking around. That was kind of the point where I said, "You know what, maybe it's time I did this for myself."
James McKinney: How old were you at this time?
Larry Namer: 32 or 33.
James McKinney: 32 or 33, lots of experience from the sewers up through management at Time. Now building
the entire cable system in the valley. So lots of experience there. Now you're 32ish.
Larry Namer: So a friend of mine and I, we just kept kicking around ideas, said, "You know, I could go work for another cable system, but that's not really what I want to do." My friend was in the real estate business and he said, "I didn't really want to be in the real estate business. I always wanted to be in entertainment." So we just said, "Okay, let's think of something kind of interesting to do."
So we kept kicking around stuff. It was not long after things like MTV started and whatever. Just started reading articles and studying the entertainment business. Somebody did a speech that we went and listened to, talking about the incredibly high cost of advertising motion pictures. We turned to each other, we go yeah, but they're doing things kind of ass backwards. The most efficient marketing vehicle you have for movie is the trailer, but you only see the trailer when you're in the movie, but you're already there. So wouldn't it be good if you found a way to bring the trailer into people's homes, where that could actually influence them on which movie to go?
We kept trying to play with the thing, we said, "Wait a second, this is MTV of the movies." with MTV, people turn to green screen and say, "And now Madonna has a new video." We said why can't we have a host there going, "And Schwarzenegger has a new film," and basically take the low cost of the efficiencies of doing just the host stand ups, and putting them against the best two minutes of a $50 million movie or $100 million movie. We didn't have to make the movie, we just had to do the stand-ups. So that's kind of how we started.
We originally called it Movie Time, but we did find an innovative technology. It was the technology that was being used for the weather channel. Where the weather channel is a national video feed, so the video that everybody saw was the same, but in each different city there's a little ticker that ran on the bottom that would tell them what the local weather forecast was, so that you would see it differently in Santa Barbara than I would see it in New York or whatever. So we said, "Gee wouldn't that be interesting if we could not only show the trailers but run the local movie theater times?"
James McKinney: Oh, interesting. Okay.
Larry Namer: So say it loops instead of weather, it's movie times. So that's the way we started. We wrote up a business plan for Movie Time. We thought it was such a great idea and people would read it and go, "Well, yeah, it's an interesting idea but you're not Rupert Murdoch or Ted Turner. You don't just go out and start TV networks."
James McKinney: Actually, let's pause on that for a second. Let's set the context for what you were trying to do. I heard an interview with Michael Dubin, the founder of Dollar Shave Club. when he started, he was entering a market that Gillette had 72% market share. From all appearances early stages, he was crazy for trying to do that. So who were the big players in the period that you were starting up movie time to become E?
Larry Namer: There was John Malone, who had TCI and Liberty. There was Rupert Murdoch of course. There was Time Inc. There was Paramount, Disney.
James McKinney: So all the, at that time, the studios as well had their own cable networks?
Larry Namer: A lot of the studios had their own cable networks.
James McKinney: So was MTV the first independent?
Larry Namer: No, MTV was not an independent. MTV was Viacom.
James McKinney: From the early days, they were Viacom?
Larry Namer: Yeah, from the very early.
James McKinney: Oh, I though they started and were acquired.
Larry Namer: No, no. They started out in a big company and they had lots of resources and stuff like that. But the breakthrough guys were basically BET, Bob Johnson, Discovery, and us.
James McKinney: Wow, so you were very early stage on independence. Oh, that's incredible.
Larry Namer: Yeah, we were. And you know, people just said, "You can't do it, it's impossible," and stuff like that. But I think it was my background in Time Inc. where I knew what I was going up against. I mean, I worked with them and for them for years. I said, "I can tackle that."
James McKinney: What was it about the opportunity that was so appealing that it was worth the obstacles that were in front of you?
Larry Namer: Number one, I wanted to stay in LA. I wanted to find something that I could do here. Number two, I became fascinated with the entertainment business and some of the incredible inefficiencies that I saw. But the movie trailer thing being the same thing. The only time I see a good marketing for a movie is when I'm already in a movie. That's kind of backwards, but the more we looked at it, we saw the unbelievable opportunity. Everybody used this analogy, saying cable TV is like an electronic newspaper. It's CNN is the headline, MTV is the music section. ESPN is the sports section. But if you really looked at the numbers for let's say the Sunday paper, the second most read section in any paper was the entertainment section. We said, "Wait a second, that's the only thing that's really missing from the picture." So we went out saying we're going to create the video version of the entertainment section of a newspaper. That's really where we saw the upside there, is to become that important.
James McKinney: So you're at this time, when you're pitching Movie Time at the time, wee you still working at the Valley Cable?
Larry Namer: No, no. They had already moved back so I was now out. Allen and I went around and we always thought it was a good idea. I think I was down to like $60 in the bank or something like that. Actually starting to get worried, saying, "Gee, maybe I was wrong here. Maybe I really should just take another job.
James McKinney: Why didn't you at that point in time? Because I think a lot of pp, they get down to that point, $60 in the bank account, knowing the resume can get them a job anywhere. What was it that you were just convinced of as to why you kept moving forward?
Larry Namer: Well, the more we went on and the more people objected I realized that their objects were not really good objections. I just became more and more convinced that I was right and they were wrong, and this was just going to be finding the right place to bring this to, and we'll get it done. That's literally what happened. We spent three and a half years of people telling us, "You're not Rupert Murdoch," and then we finally found a venture capital group with vision.
James McKinney: And your partner Allen, he was a real estate guy at the time. Was he fully dedicated in the Movie Time as well or was he still working on the-
Larry Namer: No, he came out here from New Jersey. Together, he and I. We actually had a third partner at the beginning who, along the way, became a non believer. Kind of when you hit that two year period, he's going like, "You guys are out of your mind. This is never going to happen. Why don't you just buy me out?" Which we did.
James McKinney: With your $60.
Larry Namer: Just some crazy… I think he had almost a third of the company. I think we bought it for like $20,000 or something. Then he sued us, and told the judge that, "Well, they should have told me that this was going to be successful," and the judge threw it out and said, "Don't ever come back here."
James McKinney: Of course, of course. Oh my goodness. So you finally, after two years pitching and no luck-
Larry Namer: Three and a half.
James McKinney: Three and a half years of pitching, no one investing. You're done to your $60. There's probably some doubt that's playing in your head, but you're still determined because you're just like, "These guys are idiots. They don't know what they're talking about. This has go to lay out." I love that determination. You believed in it to the point of only sitting on $60. You pitch and how did that first investment catapult Movie Time?
Larry Namer: It was, we were flying to New York for a pitch meeting with someone. Kind of going over the business plan, kind of going back and forth to make sure we both knew the numbers exactly the same way. Guy sitting not far from us said, "Oh, that sounds like a TV network. What are you guys doing?" And we told him. He says, "That's brilliant. When are you going to do it?" We said, "Well, we don't have any money." And the guys said, "Well, I'm in charge of acquisition and the vestiges for Warner Brothers. I can't do a deal like that because you're a startup, but I know of companies that would love to hear this pitch. It's a really good idea." We were like, after three and a half years of getting kicked to the curb, we were like, "Yeah, okay, whatever. Give us his name."
So he gave us the name and we called up, and we went in to see. It was funny because it was an investment bank on Wall Street that had just, it was a bond house, I'm sorry. It had just started an investment banking division, so they really didn't have a lot of deals going. We walk in and we go into the guy's office. It's a young guy who had taken over the investment banking division. We look on the wall and it's got movie posters on the wall. Allen and I just looked and we said, "No, it can't be." Then he started telling us how he was the entertainment reporter for his college newspaper and stuff like that. At the end of the day, he said, "I really love this. I'm not allowed to sign for $60 million" which is what it cost to start a TV network. He goes, 'I'm only allowed to sign for $2.5." and we go, "But what are we going to do with $2.5?"
MSNBC had just started up around then. All the numbers were coming in around $55 to $65 million. He said, "Well, but I'm only allowed to sign for $2.5." So finally we just said, "You know what, give us $2.5. We'll figure it out." They did. I give him credit for taking that leap of faith. So with our $2.5 million, we went back to LA and started preparing to launch this network.
So I called a friend who was teaching at University of Texas in Austin, and I said… he was teaching radio television and film. I said, "Do you have any kids who need intern jobs?" He said, "Yeah. I've got a lot of them. It's hard to find internships for these kids." I said, "Send them to LA."
James McKinney: Oh, that's awesome.
Larry Namer: So we ended up with like 31 interns. We had 11 employees, 31 interns. With that, we figured out how to launch the channel. It was interesting because the fact that we didn't have money led us to a lot of innovation. E! Was totally innovative when we started, and it was just because we had to be. We just didn't have the money. We were buying used industrial equipment that a company would use to make their in house training tapes, and then they graduated to real equipment. We would buy the old equipment and stuff like that. We built our first studio on a freight train rail station.
James McKinney: That's fantastic.
Larry Namer: It was pretty crazy stuff.
James McKinney: So with your $2.5 million and your 30 interns, obviously you had to adapt your business model that you had for $60 million, and I assume that when you took your $2.5 million investment, you said, "This has got to get us to money at some point. We've got to be able to launch and advertising, have sponsors," whatever the case may be. What adaptations did you make to your game and your launch plan to accommodate the reduced investment?
Larry Namer: Yeah. We had always planned to call it Entertainment Tonight 24 hours a day, so in the original plan there was lots of original programming and stuff like that. The cheapest part of our programming was taking these movie trailers, which we'd get from the studios for free, and having hosts kind of like the video jockeys that MTV had, and having them introduce all these clips. So we came up with 10 different ways to have clip shows, and just said, "Okay, all the original programming has to wait and just put it all aside," and just went with the most efficient, the most economical thing we could do.
As it turned out, people actually love it because you go to the movies, and you're seeing the best two minutes of a movie. So that's the way we started, and that's the way we kept the cost down. But as soon as we went on the air, we did a few things smart. We put the company in Hollywood, which even though Hollywood is always considered the entertainment capital of the world, there's no TV station that came out of Hollywood.
James McKinney: Oh wow.
Larry Namer: Yeah. It was kind of strange to us.
James McKinney: It was all New York or?
Larry Namer: All New York or all Burbank, or Culver City or something. There was no TV Station that came out of Hollywood, so we decided we're going to put the company in Hollywood, and then got all the Hollywood chamber of commerce and stuff to get behind us. So when we did the launch, we actually had Jack Valenti who was the head of the MPAA, the Motion Picture Association. He actually came and pulled the switch, did all of that which brought a lot of attention to it. People going, "Jack Valenti's pulling the switch on a little cable network in Hollywood? What's that about?"
So we did that. We were very, very diligent on picking hosts. We realized that if we're not going to have money to make fabulous programming, we needed to have fabulous hosts. I think we put over 7,000 people on tape to pick the first five hosts.
James McKinney: Oh my goodness.
Larry Namer: It's funny because afterwards, people say to us, "Oh you were so lucky you had those great hosts." We weren't lucky. We just realized what it was, with limited money what we had to focus on.
James McKinney: Did you, for those listening, I can only think of one of those hosts, but can you share those beginning hosts that you had?
Larry Namer: Oh, sure. Greg Kinnear. Julie Moran went on to do Wide World of Sports and then Entertainment Tonight. Martha Carlo went on to do Studs. Had Richard Blade, K Rock and things. You had Katie Wagner, Bob Wagner's daughter who went on to do Lifestyles of the Rich and Famous.
James McKinney: And these were people that had nothing before.
Larry Namer: They had nothing. They were never on TV.
James McKinney: You just saw something, and you-
Larry Namer: Sam Rubin, who's now the big… he's 20 something years the top entertainment reporter here for news in LA, so we had Sam. We picked well.
James McKinney: That is awesome. I remember Greg Kinnear and the early days, so it's interesting to know that he was picked out of 7,000 and didn't have a pedigree before E!. So you get your hosts. What were the early days of E! like? Trying to get coverage and get credibility within the industry.
Larry Namer: We were pretty inventive. So we went… now, I had come out of the cable world, so I knew a lot of the cable operators. When I talked to them about it, they go, "Larry, it sounds interesting but how do we know you're going to get the studios to give you the stuff that you're talking about?" I had met with this woman, her name is Tichi Wilkerson Kassel. She owned the Hollywood Reporter magazine, which at that time trade magazines, Variety and Hollywood Reporter were it. You woke up at 6 o'clock in the morning and you read those because you didn't want to go to work not knowing what website in those things. I talked to her and she said, "Larry, it's an interesting idea, but I'll give you advertising in the paper and just give me some stock. I just wish you luck." She was very supportive of entrepreneurship.
James McKinney: That's awesome.
Larry Namer: So we would go, and I would talk to a studio. The first studio who really came on in a big way was Universal. We went over and they said, "We don't think you're ever going to really be that big, but if you are, we want to hedge our bets." So they were giving us clips and helping us get interviews with stars and stuff like that. They kind of saw the vision. So we would take out an ad in The Hollywood Reporter saying, "We'd like to thank Universal for coming on as our programming partner."
James McKinney: Oh, that's smart.
Larry Namer: And then we would just rip the pages out and we'd send them to every cable operator in the country. Then I would call them and say, "You didn't think we could do it, but here you go. Universal's a partner." So I get a cable system to sign on, then I do another ad and say, "We'd like to thank Manhattan Cable for joining our list of affiliates," and we'd rip that out and we'd send it to Disney, then we'd send it to Paramount. So we just literally kept going back and forth.
James McKinney: I love that hustle. That is outstanding, again. What I love, even hearing this story, I just love that you wanted $60 million, you got $2.5, and you still you made it happen, and you were just inventive and innovative.
Larry Namer: Like you say, it really did, the fact that it forced us into innovation. We just didn't have a choice. Our first voice over booth, and Greg Kinnear with Greg and stuff, it was literally a closet in the conference room. The hosts were like, "Really? I've got to go do my voice overs in the closet?" but it gave it this very pirate look. It was clearly different than anything you've ever seen. Because we didn't have enough money to re-tape things. A lot of times you'd see a host make a mistake, and we would just keep rolling tape. Which we used to do with Greg all the time. Then girls started going, "Oh, he's so cute when he makes mistakes. We love when he raises his eyebrows." We're going geez, it's amazing what's happening. Greg blew up, and Julie Moran. They all did really well.
James McKinney: When did you know… I mean obviously, we know the story of E! now. I don't think everyone knows that it sold at some point in time, for $3 billion I think it was, so I don't know if everyone knows that but you can Google, you can find the stats on it. But when did you k now. You're recording in a closet… at what point, what trigger, what event happened where you said, "Now we've got this. I know this is going to succeed."
Larry Namer: The day Jack Valenti pulled the switch. When we got that far, when he pulled that switch, I just kind of went, "We did it," but the person next to me says, "No, no, Larry. You don't understand. You spent the last six months building up to this point, literally working 16 hour days." He goes, "Now think, you've got to do this every day for the rest of your life." With a TV network it's funny. It's never off. It's on 24 hours a day, 7 days a week. Running one is kind of interesting because even though you're in charge of the product, you never really get to see all the product because you can't.
James McKinney: That's a great point. Oh wow.
Larry Namer: So you really had to build a management team that you could trust. That I could go to sleep at night knowing that they were going to do things the right way and stuff like that, because you couldn't see what they were doing.
James McKinney: So knowing that your initial vision for E! was to have a lot of original content, when did that, in the E! lifecycle, when did that start happening?
Larry Namer: It started after about two years. We started doing… covering things like the academy award, not the awards themselves but the entrances, getting on the carpet.
James McKinney: Were you invited with open arms to those events?
Larry Namer: No, we weren't. as a matter of fact the first one we ever did was at that Shrine Center, and we literally climbed over the fence. We had an entire camera crew. We climbed over one o the back fences. We had no credentials, nothing, but we got great things. Again, being the first one from Hollywood. Like a lot of people in the business started looking at us and saying, "You know, this is actually kind of cool." Because we were covering parts of the business that were never covered. People would fight for their 20 seconds on Entertainment Tonight and here we were, willing to do a 30 minute show on the making of a movie. Movie trailers was never really an art a lot of people understood until we came around and made it that.
James McKinney: That's incredible. So within the story, you start making your own content. Was Talk Soup your first original piece?
Larry Namer: Talk Soup was the first original, and again out of necessity because we could get the clips, again. I mean they were from the Jerry Springer show and all that. Greg was fabulous. Greg Kinnear was the first host, and he was fabulous. It was an easy show for us to do. Very economical. But what was interesting, because when we did it, originally it was actually going to be called Talk Soap. We were thinking of doing a TV show for women who loved soap operas that work, and they get home at 7 o'clock at night and they don't know what happened on their favorite soap operas. But we couldn't clear the clips.
So we said let's call Jerry Springer. They were more than happy to give us the clips. So when people heard, they said, "Larry, we think you lost your mind." I go, "Why?" They go, "You want to do a TV show that makes fun of TV shows?" I was like, "Exactly." They were like, "Okay, whatever." But as soon as you went on, Greg was just so fabulous you had to love that show. Again, it was a pirate.
James McKinney: It was a great show. A great show.
Larry Namer: Yeah. And it ran 25 years.
James McKinney That's unbelievable. I can think of two hosts. Obviously Greg Kinnear and then Joe McHale. Those are the two that resonate with my life span. What an incredible show. How old was E! when acquisition conversations were being made?
Larry Namer: About two or three days. As soon as it went on the air, people came to us and said-
James McKinney: Oh really?
Larry Namer: Oh yeah. They said, "Well why didn't you tell us that's what you wanted to do? We would have given you that money three years ago." So it was just one of those things that, as soon as you saw it, you just had to hit yourself in the head and go oh my God of course. Again, you had all the stats saying that the entertainment pages were the second most popular in any Sunday newspaper, and here you had it in a video version.
James McKinney: Let's ask a couple retrospective questions. What do you say to those who hear the E! story, your journey, and say, "Well, it was just all perfect timing. That could never happen today."
Larry Namer: I think you say it happened time and time again today. The world is much more open. Then, you needed to start a media venture of that size and scale, you needed $60 million. Now, I could literally do it on a laptop. The barriers to entry are way down. When I first started getting in the business, video was two inch tape and giant machines that cost $2 million each, and stuff like that. We just watched it come down. Now, you could record an unbelievable video on your iPhone.
James McKinney: Isn't that crazy?
Larry Namer: It's actually much, much easier now to be creative and inventive, and be much more catering to the consumer needs.
James McKinney: Yeah. If you were to start, now I know you have a current venture Metan, which is content in China, but if you were to do this again in the states, what steps would you take differently?
Larry Namer: Well first, I wouldn't do linear television.
James McKinney: Can you explain linear television for the listeners?
Larry Namer: Linear television is the old style TV networks, like NBC, ABC, CBS where tune in Thursday night at 9 o'clock and we have whatever. If you want to watch Seinfeld, you had to watch it when NBC wanted to watch it, not when you wanted to watch it. I've always kind of been thinking forward, like how technology fundamentally changes the business and stuff. To me, when all this digital technology came around, you look at storage. As storage gets bigger, bigger, bigger, cheaper, cheaper, cheaper. It will continue, so you just kind of play it out and you say, "What happens when it gets real big and real cheap? Then you have the ability to have things in your home that allow you to record and store, and then watch things when you want." Then you say, "Okay, when you get really big, you could have things in the cloud," it wasn't called the cloud then, "That every program ever made could be stored somewhere and called up when someone wants to watch it." The changes are amazing.
Thinking of networks as brands disappears. I don't go home to watch NBC. I got home to watch certain programs and stuff. So I would not do anything linear again. Again, simple thing. Do you want to watch what you want watch, when you want to watch it or do you want to watch what NBC wants you to watch when they want you to watch it?
James McKinney: I want what I want.
Larry Namer: We all know the answer to the question. Now, you spread that out, you say now beyond being able to watch on time, you can watch it on the device you want. I can watch a program on this big TV here and then I can leave the house. Sitting on an airplane, see the end of the movie on my cell phone or my pad, whatever. So that's a major, major change. It's putting back control in the hands of the consumer, which means it better be good. They're not forced to watch your stuff anymore. It better be good stuff. So it's really forced the elevation. I think it's forced the elevation of the quality of what's out there and stuff. Today, there's so many platforms that are doing incredible stuff. The visual entertainment, I don't even call them film or television, it's visual entertainment, because I don't think it makes any difference what you watch it on, as long as you get to watch what you want.
James McKinney: Looking back on your journey, I'm a big believer in mentorship. I just think the entrepreneurial journey people say is lonely, and it can be lonely but it doesn't have to be. I think part of why it's lonely is we get so focused on the tasks that have to be accomplished in order to grow a business, whatever the business is. Looking back on your journey through E!, Metan, all the other ventures you've had in between, are there people that you point to as your mentors?
Larry Namer: Yeah, there are. When I worked at Manhattan Cable, I reported to then vice president of operations who moved higher, a guy named Frank Chiano. Frank had a similar background to me. Came from a very modest family and stuff, and just worked really hard and stuff, and was tough as hell when he needed to be. I learned an amazing amt from him. Then when all the Time Inc. took over and I became closer, I discovered them and they discovered me. So probably the most is a guy named Nick Nicholas. Nick came in from Time Inc. to be the president of Manhattan Cable, with the job to grow the business. So he was really there in a growth mode. Frank was more in the, "Let's maintain the customer," mode.
So I learned a lot from Nick. Nick eventually went on to become the president of Time Warner. But I was there through the beginning of HBO with Jerry Levin, the video group I was part of that growth with the guy who ran it was a guy named Dick Monroe. So those are all the guys who sort of set the tone for me, which was great because then I had this entrepreneurial spirit, but yet I had corporate discipline. I knew the way those guys thought and how they played the game. I also understood very clearly the timing involved in what they had to do versus the timing involved in what I had to do. So that's why a lot of the stuff I did, I went in very confidently because I could say, "I know how to play that game," but I could play it a lot faster than they can because I didn't have boards and directors to go through, and shareholders, writing reports.
If I felt something was good, I could just pull the trigger and do it. That's what let E! become, a lot of it was improvised. A lot of it we didn't really go out there knowing, but someone would come to us with an opportunity, and we'd go, "Sure." When the Wayans Brothers first started on trying to get on television, we let them host. They would walk in, say, "Hey, we have nothing to do," here's a microphone you can be the host of the next hour. Paula Abdul and stuff. So we kind of became almost the clubhouse for Hollywood, but it was just a comfortable place to go and hang out. If we felt like doing something, I mean one day we had Jack Lemon, we brought a piano on the set and we had Jack Lemon play the piano.
James McKinney: That's incredible.
Larry Namer: Instead of doing an interview, because he didn't like doing interviews. Then every agent in town was like, "How did you get Jack Lemon to come on? He doesn't do that." We go, "We just let him do what he wanted to do, not what we wanted him to do."
James McKinney: So I have to ask a question I did not intend on asking until you brought up the Jack Lemon story. When you look back at your career at E!, specifically E!, what is one whether it be an interview, that one moment, that you look back on and that is your fondest memory of that period?
Larry Namer: Well, the launch obviously, but after we were going and I got a call from Warner Brothers. Well, there's two. One, I got a call from Warner Brothers, which was kind of wow, Warner Brothers calling me, asking me if they could borrow Greg Kinnear to do a pilot of a TV show. Of course, I agreed. It was something called College Fun House. Just had a very short run. But going wow, that's really weird that Warner Brothers is calling me to borrow some of our people. The other was we had… the last studio to kind of sign on with us was Paramount, and no matter what we would do, they wouldn't give us clips. They wouldn't advertise with us. They wouldn't do anything.
So we used to do the movie countdown, whether it be Greg Kinnear or whatever. We go, "And the number 10 movie for last week was blah, blah, blah by Disney, and then the number nine was blah, blah, blah from Columbia. And the number eight was, oh some studio that starts with a P. Don't even bother with that one." I had a friend at Paramount who told me that the president of Paramount literally came down to the marketing department and screamed at them going, "I don't know who this company is, but I don't want to hear this anymore. You figure out a way to work with those guys," and we started working with Paramount right after that.
James McKinney: So one of the things that I love about the E! story is that two and a half year mark, one of your partners wants out. You're down to your last $60. One of the personas of the listeners might just be that entrepreneur that just isn't getting traction, and isn't sure if it's time to call it quits or not. What do you say to that person in that journey?
Larry Namer: Number one, you've got to do a real honest assessment there. You can't let your emotions get in the way of really figuring out was this a good idea to being with, is it still a good idea. Sometimes time just passes you by and what was a good idea two years ago may not be. But a lot of people hang onto those way too long. I think that's the downfall of a lot of people, is they just hang on to an idea, who might have started out well but now technology is kind of past it and stuff. So number one is make that honest assessment. If you're so convinced, just hang onto your dreams. If you really believe in it, you've got to go for it.
James McKinney: Or evolve, right? If you're so passionate about it, it's like what is that evolution of whatever your vision is.
Larry Namer: And it all evolves. Even when you take E! we started out one way, and then obviously we went into the Howard Stern show, and E! Hollywood True Story. Yeah, it's a progression. You look now at any TV, you look at CBS and you say is it what Bill Paley envisioned in 1940 something, and the answer is no, it evolved. But it's still his baby.
James McKinney: I'm a big fan of reading and I always want to ask the question what books have helped shape you?
Larry Namer: There's a book, well one of the most, is Juan Enriquez, called As the Future Catches You and it was just really focused on thinking about the what can be versus the what is. It's just a way of thinking. Those, and my Bruce Lee books. Bruce was a much more than a fighter. Bruce was a philosopher, and he was really into be the best. Don't try to and be someone else and stuff. Be the best you can be. Really convinced me I didn't have to be Rupert Murdoch. I could be me and be successful in my way. I didn't have to be in someone else's.
James McKinney: Was that something that was constantly present in your mind as you were building E!, was that I've got to be Rupert Murdoch?
Larry Namer: That's what other people expected, and unfortunately it's when people meet me, a lot of them are taken back because they expect me to be that. They go, "Oh, he started TV networks. He's a mogul." I listen to some of the descriptions and I go… and then they realize I'm still the son of a Pepsi Cola driver from Brooklyn. I don't live in giant mansions and fly in private planes and stuff. I like my quiet, I like my privacy. I want my kids to grow up with values and stuff like that. While E! obviously is huge, I kind of carefully moderate that whole thing.
James McKinney: That's incredible. Larry, I really do appreciate you affording me this opportunity for The Startup Story podcast, but all the other times you've given me your time to share the story. I learn from you each and every time. I know our listeners have probably learned a tremendous amount as well. It is incredible to just get your perspective with all your experience, so thank you so very much.
Larry Namer: Sometimes it's fun to think back on some of those funny experiences, so thank you.
James McKinney: Over the last year, I have had the good fortune of meeting with Larry a few times for various reasons, and every single time I learn something new from him. His experience gives me a perspective I did not have before. One of the narratives that I shake my head at is when I hear people talking about the days of old, or the golden era that will never happen again. You hear people talk about how they miss the dot.com boom in the mid to late nineties, or the mobile applets of the mid 2000s. Hearing from Larry how much easier it would be today to start a media network tells me that the best opportunities are still ahead of us.
Think about what he said regarding the ability to record from your mobile phone versus needing to obtain expensive commercial grade video equipment, like he had to when he started E!. Or being able to leverage platforms like YouTube or IGTV to create a viewership as opposed to being dependent on cable distribution. Don't believe the false narrative that all the great ideas or opportunities have past. Now is the time to move on your idea.
Larry is still moving on new ideas that he has. Aside from his company Metan Global, that content producer in mainline China, he has a startup called Yuzzl.com. It's a platform started by merchandising some hilarious Tweets from our president, and has since grown to allow other brands to establish their own storefront. You know, I believe in entrepreneurs helping other entrepreneurs, so please check out Yuzzl.com. Again, Y-U-Z-Z-L.COM to see if there's a way to support a fellow entrepreneur.
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