How a Mar-a-Lago Lunch Birthed the Marvel Cinematic Universe
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Lunchtime, early 2003: Donald Trump was one year away from starring in The Apprentice and fourteen years away from being sworn in as the forty-fifth president of the United States. He owned a share of the Miss Universe beauty pageant, some Atlantic City casinos on the verge of bankruptcy, and a luxury beach resort in Palm Beach, Florida, called Mar-a-Lago. Trump had bought the Mar-a-Lago mansion in 1985 and converted it into a private club. Unlike the other upscale clubs in Palm Beach, Mar-a-Lago was willing to accept Black people, Jewish people, and gay people as members, so long as they could afford the $100,000 membership fee.
Trump, circulating through the Mar-a-Lago dining room, glad- handing and schmoozing, came upon an odd couple: Ike Perlmutter and David Maisel. Trump knew Perlmutter well as a friend and a fellow member of the unofficial New York City plutocrats club. Perlmutter would become a major donor to Trump’s presidential run and, during Trump’s presidency, would be part of a three-person Mar-a-Lago cabal that unofficially ran the Department of Veteran Affairs. (When news broke of that unusual arrangement, Perlmutter and his associates insisted that “At all times, we offered our help and advice on a voluntary basis, seeking nothing at all in return.”) Membership at Mar-a-Lago was the only known luxury for the frugal Perlmutter.
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Trump wasn’t familiar with Perlmutter’s lunch companion. David Maisel wasn’t socially adept by anyone’s measure, including his own. Tall and lanky, he seemed much younger than his forty years. His mind was always spinning with business plans and financial schemes. Sometimes Maisel came up with ideas faster than he could get words out of his mouth; he spoke quickly and enthusiastically, and with an occasional stammer. Now, in Donald Trump’s dining room, he was eagerly trying to talk his way into a dream job.
Perlmutter had taken Maisel to Mar-a-Lago for a meal that would help chip away at the club’s annual $2,000 dining minimum. Before the appetizers arrived, Maisel launched into his pitch. What if Perl- mutter and Marvel could keep the money from blockbuster super-hero movies, instead of most of it going to studios like Fox (for X-Men) and Sony (for Spider-Man)? What if Marvel Studios was a real studio, not just a glorified production company? And what if he, David Maisel, could make that happen without Perlmutter having to contribute his own money?
A few months later, Maisel turned up for his first day of work at the office space Marvel Studios shared with Spectra Star, the Los Angeles building Marvel staffers had nicknamed “the kite factory.” Maisel, the new president and COO, immediately found himself at odds with the CEO Avi Arad, a former toy designer.
When he had first approached Arad hoping to pitch Perlmutter, Maisel hadn’t revealed the scope of his ambitions; he had sold Arad on the idea that his time with Michael Ovitz at Disney had qualified him to work on brand management, intellectual-property management, and theme-park rights. Arad was shocked to learn, only after Maisel had been hired, that Maisel wanted to launch a new studio, a move that would likely make Arad irrelevant. And Arad took offense at the implication that any of the film deals he had made were bad ones.
“I love Daredevil. I thought it was enjoyable. Okay?” Arad said in 2004 when, bafflingly, Fox went into production with Elektra, a disastrous spinoff from Daredevil starring Jennifer Garner’s assassin character. Arad made excuses for Daredevil underperforming: the opening-weekend weather was bad; Ben Affleck’s real-life relationship with Jennifer Lopez distracted people; Daredevil wasn’t a famous enough character.
Maisel had a simpler explanation. “Really, the movie just wasn’t done in the way that it should have been,” he said. He intended to do better. The relationship between Arad and Maisel started tense and quickly got worse, stopping just short of a duel with sai blades in the parking lot. After a full decade with Marvel and Toy Biz, Arad was confident he could outlast Perlmutter’s new golden boy and his crackpot schemes. Indeed, he believed that Maisel’s long-term plan to turn Marvel Studios into an actual studio was doomed to failure. If Arad was certain of anything, it was that Maisel wouldn’t be able to start a studio without a source of funding. He waited for the interloper to run headlong into that harsh reality .
Maisel ignored Arad. Poring over the fine points of the film deals that Arad had brokered, he noticed that for some of the characters, Marvel still retained the direct-to-video animation rights. Maisel promptly negotiated a deal with Lionsgate for four direct-to-DVD animated features based on Marvel characters. A typical Arad-era deal would have sold the license to the character in exchange for some cash and a seat at the creative table. Maisel instead negotiated a contract in which Lionsgate would pay the budget of $300,000 per film. Marvel Studios would make the movies, retaining complete creative control, and deliver them to Lionsgate, which would market and distribute them. After Lionsgate earned back its investment in each movie, it would split the profits evenly with Marvel.
“It was the first time that we fully had producing responsibility,” Maisel said. “We had to make these on budget and deliver them to Lionsgate. When I talked to the board and Ike, I explained that we were guaranteed money. So we’re making $1.2 million, but we’re also producing stuff, so that was really fun.” At long last, Maisel was making movies: Ultimate Avengers: The Movie and Ultimate Avengers 2: Rise of the Panther, both released in 2006, sold a combined 1.5 million copies, with each disc placing in the top ten children’s DVDs that year. (The Marvel-Lionsgate partnership would eventually yield eight animated films.)
Maisel also worked his contacts to set up TV deals. Ari Emanuel, his old boss at Endeavor, paid a $1 million advance for the rights to produce a live-action pilot featuring the superpowered detective Jessica Jones for ABC. The show never happened, but that hardly mattered: Maisel had brought in a million dollars on a side deal while Arad’s pet project, Ghost Rider (about the motorcycle-riding, demon- possessed Johnny Blaze), had been stuck in development for years. Any questions Perlmutter had about betting on Maisel evaporated. Perlmutter was occasionally uncertain about his gut, but he never doubted the bottom line.
After his early success, Maisel went to the Marvel board of directors with his proposal to build a live-action studio. (In recent years, Arad has claimed that, earlier in 2003, he pitched the board a plan in which Marvel would form its own studio, only to get shot down because “Ike’s scared of the film business,” but nobody else at Marvel seems to remember this happening.) Perlmutter and the board approved the new master plan, siding with Maisel. Arad was no longer allowed to make new deals or license any characters to other studios. All the remaining Marvel superheroes would stay at home while Maisel tried to make his big idea work.
That decision left Arad embittered. The rift between him and Perlmutter would never heal. But Perlmutter hadn’t written Maisel a blank check, or a check of any amount whatsoever. As Maisel remembered the pivotal meeting, it ended with the board telling him, “Don’t come back and talk about movies unless we have no money at risk.”
Since Marvel wasn’t going to provide any money itself, Maisel needed to convince a large financial institution to stake him the hundreds of millions he needed to launch Marvel’s studio. He proposed that the new studio would use the borrowed money to make films, earning enough to pay back the loan with interest. The collateral for such a large loan would be significant: The film rights to ten of Marvel’s characters. A bank that ended up with those characters could keep them in perpetuity, even if it didn’t use them, or it could sell them to any interested studio, with no benefit to Marvel. It was a serious risk, but Maisel needed the money.
Marvel executive John Turitzin, a lawyer who knew his way around a complicated bank deal, was assigned to oversee the ambitious project. He outranked Maisel on the Marvel corporate ladder, but he nevertheless thought of himself as Maisel’s “assistant.” As Turitzin put it, Maisel did most of the work “in his own head…. It was him all by himself, conceptualizing and developing it, thinking it through, pursuing thought pathways.”
Arad had been so successful licensing Marvel intellectual property, most of the company’s biggest names were already under contract with various Hollywood studios. That left Maisel with a weaker selection of characters to play with. These ten superhero properties, most of them future marquee names for Marvel, were considered B-listers and C-listers at the time: Captain America, the Avengers, Nick Fury, Black Panther, Ant-Man, Cloak and Dagger, Doctor Strange, Hawkeye, Power Pack, and Shang-Chi. Maisel had to tell two contradictory stories: while he persuaded banks that those assets were worth a fortune, he simultaneously needed to convince the Marvel board of directors that, if the deal went bad, losing the American film rights to Captain America and his superfriends would not be a huge loss.
Persuading the board was easier than he expected: no studio was interested in any of the characters in question. As Turitzin remembered it, the comic-book version of Captain America was “this funny-looking red-white-and-blue character, dressed, basically, in a cut-up flag with little white wings on his head, carrying a shield, and just weird.” He added, “There’s a reason why those characters had not been turned into movies or TV shows.”
Also helping Maisel’s case was that his offer didn’t include all the rights to the characters as collateral, just the American film rights. As with other Marvel characters, including Spider-Man (movie rights controlled by Sony) and the X-Men (permanent residents of the Fox lot), Marvel would retain the rights to merchandising, publishing, videogames, and international film rights. If Marvel had ever wanted to make a Spider-Man movie to be shown exclusively in China, it legally could have done so without Sony’s input, although that would have been impractical. The realities of big-budget filmmaking being what they were, Sony and Marvel were forced to work together to make movies that could be released in the US and around the world.
“I had to ask my board for zero money, and they were guaranteed to make money,” Maisel recalled, almost giddily. “It was so exciting for everybody.”
Turitzin, however, remembered the Marvel board being dubious: “It was a very frightening idea to the company because of the enormous potential downside to making movies. There was a lot of resistance at the board level to doing it.”
For more than a year, Maisel pitched banks with his Marvel Studios scheme, and failed again and again. Finally, in the spring of 2005, Perlmutter set up a meeting for him at Merrill Lynch. Knowing that this was probably his last chance, Maisel poured everything into his presentation, drawing on his varied experiences as a comics geek, as a Hollywood player, and as a world-class contract-cruncher. Turitzin, who was in the room, said, “David spun a story about how popular these characters were and the depth of the storylines behind them and what they could support. He clearly had a passion for the source material.”
Facing a room full of skeptics, Maisel wore them down, persuading them that a goofy overgrown Boy Scout named Captain America could one day be a cinematic icon. But he couldn’t sell his vision for Marvel Studios solely on the name recognition of lesser-known Avengers like the Vision. Arad, however, had unwittingly done Maisel a favor. Because of the hit movies that Arad’s deals produced, most notably Spider-Man and X-Men, Maisel was able to claim truthfully that, despite Daredevil’s middling reputation, films based on Marvel characters had an excellent track record at the box office. As [future president of Marvel Studios] Kevin Feige, who was operating very much in the background at the time, put it, “We were able to get the financing because almost all the movies worked.”
Six months of tough negotiations followed, but Maisel and Merrill Lynch arrived at a deal: the bank would put up $525 million, with the legion of substitute heroes as collateral. Maisel reasoned this would be enough money to cover the budgets of four feature films (with some cash set aside for overhead). The brand-new studio had four chances to make at least one hit — or as Maisel put it, “We were guaranteed four at-bats.” Maisel also brokered a deal with Paramount Studios, which would handle the distribution and marketing, taking a modest percentage of the box-office gross in return.
Then, on a September afternoon in 2005, the bankers flinched. “Ike, they’re changing the terms,” Maisel whispered into the phone, speaking with his boss from a Merrill Lynch conference room. The bank now wanted Marvel to come up with one-third of the money itself. Maisel and Turitzin knew Perlmutter and the board would never approve that outlay. Turitzin leaned back in his chair, put down the pen he had been using to take notes, and took a moment to reflect on the end of Maisel’s dream. “This has been a fun project,” he thought. “But it’s over and done. It’s dead.”
“I’m in the conference room,” Maisel quietly told Perlmutter. “I’m not going to leave.” Maisel stubbornly refused to get up from his chair. As he described it: “I just held my breath like a little kid.” Maisel knew there was another option for covering the shortfall: Marvel could bring in a third party (likely another studio) as an investor. That move, however, would require giving up on his aim of full creative control, so he didn’t even want to mention it.
Before he turned blue, Maisel came up with a solution. Marvel would shoulder some of the production costs by preselling distribution rights in five foreign territories for each of the four films. Maisel persuaded Merrill Lynch to agree on contractual language that said Marvel would try to cover a third of the budget. “They changed the word from ‘requirement’ to ‘target’ and solved the issue,” Maisel said, grinning. If Marvel didn’t produce 33 percent of a film’s budget with foreign presales, the bank was still on the hook for the remainder, so long as Marvel could demonstrate that it had attempted, in good faith, to raise the money.
In November 2005, Marvel and Merrill Lynch finalized the deal. Two and a half years after his lunch at Mar-a-Lago, David Maisel had his studio. The final contractual hurdle for Merrill Lynch to commit was for Paramount to sign on officially as Marvel’s distributor. So it was a big day at the kite factory when the fax arrived confirming Paramount would distribute six movies made by Marvel Studios. The staff gathered around the fax machine, looking at the newly printed document as if it were a holy relic, realizing that they would soon be making movies and contemplating what an amazing opportunity and responsibility that was.
Arad poked his head into the room, witnessing the moment when his rival’s dream was coming true. In his baritone voice, he dramatically intoned, “Be afraaaaaaid.”
Adapted from MCU:The Reign of Marvel Studios by Joanna Robinson, Dave Gonzales, and Gavin Edwards. Copyright © 2024 by On Your Left, LLC. Used with permission of the publisher, Liveright Publishing Corporation a division of W. W. Norton & Company, Inc. All rights reserved.
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