The Comics World is Dictated
by the Success of Marvel Comics

For the past few weeks in this column, I've been relating my personal perspective on certain elements of the recent history of the comic industry. In particular, I've told you why I think that the "speculator boom" of the early 1990's never really existed, but was actually a boom in the number of unknowledgeable people encouraged to open comics retail stores by the open door policies of Diamond Distributing and Capital City Distributing. I moved from that topic into a couple of columns designed to provide you with some insights into the damage to the comics world caused by Ronald O. Perelman during his ownership of Marvel Comics (1989-1997). My purpose in covering these topics was initially to alter what I felt were some misperceptions on the part of many comics fans as to what's been happening during the past few years. I now want to take this all one step further, by relating some of my own experiences with Marvel Comics during the 1990's.

I'll begin by stating that it has been my experience that the health and well-being of the comics world is dictated by the success of Marvel Comics at any given point in time. I know this thought is an anathema to those of you who detest either the super-hero genre in general, or work-for-hire publishers, but the fact remains that Marvel not only provides the critical sales volume that is required in order for the distribution system (i.e. Diamond) and many retailers to survive in these days of low print runs, but also acts as a strong entry portal for young readers first becoming comics fans. DC Comics manifests similar strengths, but has been much more stable over the years. You can rely on DC always being there, but Marvel has gone dramatically up and down, and that has been the number one factor influencing comics sales over the past decade.

That having been said, I need to make clear to everyone that we came far closer to losing Marvel as a publisher in 1998 than all but a few people in the comics world are aware. Take the time to read Dan Raviv's excellent new book, COMIC WARS, and you'll get a real sense about how much brinkmanship was employed by the various investors, bankers, judges, and the trustee during the negotiations prompted by Marvel's December, 1996 bankruptcy filing. No one actually wanted to shut the company down on purpose, but the fact that they couldn't reach agreements on critical financial issues meant that the managers running Marvel were frequently scrambling to keep enough operating capital around to keep the presses going. The seemingly endless number of layoffs and other economy measures announced by Marvel during this period were simply a reflection of the fact that everyone involved in the process of Marvel's bankruptcy was strictly looking out for their own needs, and completely ignoring the fact that without working capital, the publishing end of the company would ultimately be forced to shut down.

I had some personal experience in this process because I was recruited by Jim Shooter to participate in a short-lived effort to purchase the publishing division of Marvel. This came about because John J. Gibbons, the Marvel trustee in 1998, publicly sought alternative bids to those submitted by competing investment groups led by Carl Icahn and Isaac Perlmutter. Shooter asked me to participate in a group that consisted of two New York investment banking firms, a top New York partnership, and himself. When I met with the bankers, I was told that they believed that they could put together an investment pool of between $80 million and $200 million, depending on the quality of Marvel's assets. The theory was that everyone would get some measure of equity if the deal worked out, with the lawyers and bankers keeping the lion's share.

While Jim Shooter's goal in participating in this consortium was to regain leadership of Marvel, mine was far more altruistic. In fact, I didn't want to be involved with purchasing Marvel on any level. The idea of having to leave my wife and my four daughters, my company, and my organic farm in Boulder in order move to New York City for an indefinite period, filled me with dread. I strongly believed, however, that the future of the entire comics world was possibly at stake, so I reluctantly agreed to be a marketing advisor to the consortium, with the thought that I would (temporarily) take the leadership role in marketing at Marvel if our bid succeeded. My heart was certainly not in this endeavor, but I thought it important enough to risk changing my entire life in order to contribute to potentially restoring some measure of vitality to Marvel comics.

The irony of this situation was that I was so broke at the time that I could barely afford to even travel to NYC. With all of our company working capital being absorbed by our newly-created Internet division, even my credit card was redlining. To keep it from bouncing, I stayed in a youth hostel-type hotel near Harold Square. It was an OK room for $65/night, but I shared a bathroom down the hall with five other guests. It was quite a contrast to leave my humble room and meet up with the rest of our group at Penn Station, in order take the train to the incredibly luxurious glass tower (across the river in New Jersey) that housed the law offices of Marvel's court-appointed trustee.

To be continued...

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