I Lost It at the Movies

Glamour, moguldom, potential home-run returns -- is it any surprise that so many CEOs with cash want to try their hand in the film business? Or that bad things happen when they do?

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Barry Quart knows what you're thinking. Or knows, at least, what most of Hollywood is thinking as he tools into L.A., into Hollywood's town, a former entrepreneur with his Ferraris, his bankroll, his confidence and ambition, his golden record in an altogether un-Hollywood line of work. He's a type, Quart is -- another accomplished company builder now come to make movies. And he knows Hollywood sees only an out-of-towner carrying cash and the expectation of success. And that what Hollywood is thinking is, "No living way."

But that's all right, Quart would tell you. He's coming anyway. And he has a plan.

He'd better have one. Though the occasional outsider has made headway in Hollywood (see "Gone Hollywood," below), "movie folks have a long tradition of removing the money from your pocket," says one media banker. Adds another analyst, Harold L. Vogel, author of the classic Entertainment Industry Economics: A Guide for Financial Analysis: "Outsiders are sheep to be slaughtered. Lambs to be shorn."

Still, they come. Nowadays, according to film banker Lewis Horwitz and producer Jeremy Barber, wealthy entrepreneurs are showing up in greater numbers than ever -- looking for power, sex, fame, drugs, a vehicle for promoting their own values, or even the chance to build something. In one respect their timing is good. With a soured economy and the pullout of the latest foreign investors to lose their money en masse (the Germans), cash is again king in Hollywood. The industry needs it. It's just that the arrivistes aren't likely to be left with any of it when they're done.

"Hollywood," says one prominent lawyer who has waved many a client away from the business, "is a town famous for the way people beat a path to its doorstep and then leave wearing a rain barrel. I'm talking about very intelligent people -- highly successful and greatly accomplished in their other endeavors." According to a well-informed source, even Microsoft cofounder Paul Allen is looking for a way out of his $500-million investment in Steven Spielberg's struggling DreamWorks studio. (Allen denies it.) Outsiders can invest "for fun," says investment banker David Davis -- to buy entry to the parties, a fringe place in the scene, a fleeting taste of the life. "But they can't do it for profit."

"I'm not looking to make high art that no one goes to see."

Barry Quart understands. He sits in an upscale Chinese restaurant across Sunset Boulevard from his offices, which cap a strip of low-budget-film companies on the boundary between opulent Beverly Hills and a smarmy stretch of West Hollywood. Between bites of moo shoo shrimp he says: "The standard [moviemaking economic] model can't work. It's a business you go broke at." And yet ...

Quart -- now 45 and with a home, a wife, and a 12-year-old daughter in San Diego -- tells of growing up as the son of an aircraft engineer and an encyclopedia saleswoman in L.A.'s neighboring San Fernando Valley back when American Graffiti resonated with teenagers. The valley was dull, hot, and oppressively smoggy, and Quart found his escape inside movie theaters, watching the latest science-fiction horror flicks. Usually, he was the last person to leave; he studied end credits, even noting a film's financiers. He followed the fortunes of high-flying movie companies such as Cannon Pictures that operated independently of the major studios. "I've always been fascinated by [moviemaking] -- not from a celebrity-cult standpoint but from a business standpoint," Quart says. "I couldn't for the life of me sit down and write a script. But when I see a movie, I can say: 'It was a good movie. But it would have been so much better if they had done this and this and that.' I could have done that forever."

Instead, Quart got rich by saving lives. As president of research and development at Agouron Pharmaceuticals, a pioneering San Diego drug designer, he shepherded the development and approval of a key constituent drug in the AIDS cocktail, buying HIV victims perhaps years of survival. In 1999, Warner-Lambert bought his company for $2.1 billion, enriching Quart even as it kept him in charge. Soon, though, Warner-Lambert was the victim of a hostile takeover by Pfizer, and Quart became a cog in what is now the world's largest pharmaceutical company. He left and returned to his boyhood fascination.

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