Hollywood’s smartest actors run businesses, too
They are the ones who are aware that stardom is a fleeting and financially risky proposition
IBM, the technology behemoth, began its life as International Business Machines. They made rudimentary adding machines, mostly for merchants and small businesses. Ray Kroc, the impresario behind the McDonald’s empire of hamburgers, was originally in the ice cream manufacturing industry, selling electric blenders for the preparation of milk shakes.
At a certain point in every business, the people in charge have to make a decision: do we keep doing exactly what we’ve been doing, or should we diversify our product line? The in-vogue term for this kind of strategic move is “pivot,” and the business press is full of companies contemplating, or in the midst of, some kind of major pivot from one thing to the next.
Being a celebrity is a business too – in many ways a more cutthroat and unforgiving one than making hamburgers or adding machines. Celebrities, unlike technology concerns or chain restaurants, don’t really have what is called, in business jargon, defensible businesses. The keys to success in the film and television business are fairly non-exclusive: you must be reasonably attractive and you must be able to speak clearly. That’s about it. As Spencer Tracy, the iconic Hollywood movie star, put it, the trick to being a great actor is knowing your lines and not bumping into the furniture.
Los Angeles is an international magnet for attractive people from all over the world. For almost a century, young people have been arriving there – and yes, they’re mostly young – with dreams of riches and stardom, only to discover that every other pretty face from every other outback town has had the same idea. In Hollywood, there’s always someone a little richer, a little more famous and a notch or two higher on the beauty ladder than you are.
Which is why smart celebrities keep expanding their corporate offerings. Jessica Alba – without question one of the most dazzling and alluring young movie stars around – must have noticed at some point the long line of newer, fresher Jessica Alba’s gathering in audition rooms, appearing in smaller parts, generally moving closer and closer to her level of prestige and power. She must have realised, smartly, that movie stardom is a fleeting thing – sort of like being a professional athlete – and that eventually she’d be replaced with a more recent product. This is, after all, an industry in which it’s not unknown to send out a casting notice for a “younger” version of whoever is in fashion. Even when he was a fresh face in his twenties, there were casting directors out scouting for a “young Tom Cruise”.
Jessica Alba, though, took a page from IBM and McDonald’s book – she got into a new line of business. Along with a few partners, Alba is an owner and executive of a cleaning products company called The Honest Company, which is currently valued at almost $2 billion (Dh7bn). That’s a figure well in excess of whatever she might have made as a movie star.
Reese Witherspoon, the talented and accomplished actress, has opened a small clothing and housewares design business, along with a charming boutique in Nashville, Tennessee. Her products are simple, fun, sunny knick knacks and accessories for the home, along with tasteful and classic women’s clothing. It’s a smart way to hedge against the uncertainty of the entertainment industry. Actor Ashton Kutcher is an active venture capitalist, and has invested in some of the tech industry’s most high-flying companies. Rapper 50 Cent made tens of millions with a mineral water business when he sold the company to Coca-Cola. Robert De Niro has ownership in a swanky New York hotel, as well as the Nobu chain of upscale sushi restaurants. And everyone knows that music entrepreneur Dr Dre sold his headphones company to Apple for $3bn.
Being a movie, television, or music star these days is really just a springboard to a better line of work – something with a much bigger upside and no age limitations. Alba and Witherspoon can keep selling their wares well into their sixties and seventies, should they wish to. Kutcher, who hasn’t been in a feature film or television series in years, can relax with his Silicon Valley riches. Hollywood can move on to whatever the hot new thing is without dooming them to bankruptcy or, worse, anonymity. They’ve diversified their portfolios, which as any savvy investor will tell you is the safest and smartest move to make.
There are still young, attractive hopefuls pouring into Hollywood daily, eager for their shot at fortune and celebrity. The smarter ones, though, realise that stardom – now more than ever – is a fleeting and financially risky move, and are actively searching for ways to branch out. The most successful Hollywood aspirants will end up treating their careers, and themselves, the way Ray Croc treated his milkshake machines – as a place from which to pivot to another more lucrative and dependable business. It’s not enough to be a rich, attractive movie star anymore.