Chris Manderson is Quoted in the Los Angeles Business Journal, "Seeing Stars: Bullish on Celebrities, Athletics".
Chris Manderson, Partner and Co-Chair of the Business, Corporate and Tax department was quoted in Los Angeles Business Journal in an article titled, "Seeing Stars: Bullish on Celebrities, Athletics".
Chris Manderson, chair of the corporate practice at the Beverly Hills-based law firm Ervin Cohen & Jessup LLP specializing in mergers and acquisitions and private equity, said, "the significant downturn in leverage deal value post-2021 has made equity firms eager to get the best bang for their buck with the deals they do make."
“Leveraged deal value has fallen off much harder on average than overall deal value, which makes the difficulty of obtaining financing all that much worse,” Manderson said. “Given that, it makes great sense that private equity firms would look to alternative strategies to get those funds raised, deploy their capital, and close deals.”
Manderson said, "celebrities with mainstream appeal can be significant needle-movers for fundraising, and in that regard, the Kardashians have among the most dependable brands."
“Their words carry substance. When the Kardashians back a consumer-facing business, it’s something that has genuine value, especially in categories like consumer cosmetics and fashion,” said Manderson. “They’re not out there investing in aerospace and defense contractors, but when it comes to things like beauty products, health and wellness and the like, their name carries weight in the same way that Tom Cruise’s name means something when you’re trying to sell a movie.”
"Private equity affiliated with a big name combined with “the right kind of business brings something to the table that no one else really can,” Manderson said.
“You can have a guy with an MBA from Harvard, but chances are all of that know-how won’t help them deploy capital nearly as effectively as the Kardashians could. It is the rare, very rare case where a big-name celebrity that actually brings business value outside of the realm of entertainment.”
Top Hollywood influencers like Kardashian have enough clout and cash to direct investment, but Manderson noted that it’s much more common to find high-profile names in sports and entertainment on the side of the companies benefitting from the funding.
“Los Angeles is overwhelmingly a middle-market city, and the companies here tend to be privately owned and driven by private equity transactions,” Manderson said. “And with the heart of the entertainment industry a few miles down the road, that creates some obvious opportunities for synergy between the two.”