3 DURABLE DECADES

It’s a long journey from booking movies into college dorms to having your salary surpass – and even double – that of legendary media mogul Ted Turner. But Robert Shaye, the 56-year-old founder, chairman and CEO of New Line Cinema, has managed to parlay a career in independent film into Turner-size success.

Shaye built New Line from a cult movie distribber in the late ’60s into a premier arthouse distributor in the ’70s, moving into production of niche and horror pictures in the ’80s. More recently, the company he started in 1967 in a Greenwich Village apartment became a crown jewel of ’90s-style merger and acquisitions mania when it was purchased by Turner’s TBS last year for half a billion dollars.

“New Line had a proven track record of success,” says Turner, “based on excellent management, successful distribution operations and a diverse slate of film and TV properties. They are one of the country’s best-run production and distribution companies.”

Indeed, if the box office numbers for New Line’s “Mortal Kombat” continue to climb (the pic has already crested $60 million), the movie continues New Line’s rep as a producer capable of doing major-style numbers.

To appreciate the magnitude of Shaye’s achievement, one need only regard the wreck-strewn highway of failed indie film companies: Cannon, De Laurentiis, Vestron et al. With its canny combination of creative daring, commercial timeliness, tiny budgets and low-risk deal-making, New Line’s unparalleled success as an indie over nearly 30 years speaks volumes about Bob Shaye the entrepreneur.

Throughout his life, Shaye has demonstrated a combination of frugality, business acumen and the creative eye of an artist. His business and legal training have blended with the inherent spirit of an iconoclast, and a gift for recognizing creative talents and trends. Shaye, who built a successful film production outfit from the ground up, is more in the mold of early Hollywood execs like Irving Thalberg than the current breed, who may have little hands-on experience with either production or distribution.

Michael Lynne, chief operating officer and president of New Line since 1992 and a Columbia Law School classmate of Shaye’s, says a look at Shaye’s Detroit upbringing provides insight into his business sense: “His father was in the wholesale grocery business, a business of very small margins. Neither of us were particularly privileged as kids: We grew up with a work ethic that was real – we were expected to succeed on our own merit.”

Recalling their law school days in the early ’60s, Lynne says Shaye’s combination of mainstream ambition with a free spirit was already apparent. “In those days, you went to school in a coat and tie,” he says. “Out of 350 guys, only one never once wore a tie – Bob Shaye. But he was serious about the work. After graduating, he got a Fulbright scholarship.”

Having majored in business administration at the University of Michigan, Shaye used his Fulbright to study copyright law in Sweden. There he learned techniques that would help put his fledgling firm on the map when he started New Line soon after returning to New York.

Looking for pics to distribute to college campuses, Shaye discovered that “Reefer Madness” was in the public domain, and had the acuity to know a cult film when he saw one.

On the edge

Sara Risher, now chair of production at New Line and an employee for 21 years, says, “Bob’s always immediately recognized unusual talent. New Line always had the edgy films.”

In addition to “Reefer Madness” and Jean-Luc Godard’s “Sympathy for the Devil,” Shaye supplied the coffeehouse crowd with Czech films like “Hotel Ozone” and Euro art pics like Lina Wertmuller’s “The Seduction of Mimi.” Risher, whose first duty at New Line was learning to thread a 16mm projector, recalls that in the late ’70s, New Line distributed films from a loft on 14th street with a staff of only 10 people.

The versatile Shaye has even dipped into directing, helming New Line’s “Book of Love” in 1990. At 15, he made a training film for the carry-out boys at his father’s supermarket – a cautionary tale advising on the handling of eggs. He also shared first prize in the Society of Cinematologists competition for U.S. directors under age 25 with another young helmer named Martin Scorsese.

Along with high-toned European films, Shaye has always had a romance for campy exploitation pics. From “Texas Chainsaw Massacre,” one of his first releases, to a series of memorable John Waters efforts – “Female Trouble,” “Pink Flamingos” and “Polyester” (with Odorama scratch ‘n’ sniff cards) – probably no one has made more money from odder movies than Shaye. Risher recalls one gem, “The Crippled Masters,” which was “about one guy with no arms, another with no legs, who one on top of the other made an awesome fighting machine.”

After carefully laying the groundwork as a niche distributor, Shaye moved New Line into production in 1979 with a pic called “Who’s Killing the Stuntmen?,” which was sold to NBC. But if anything’s riskier than low-budget distribution, it’s low-budget production, and Shaye needed a hit. With the “Nightmare on Elm Street” series, the hit became a franchise. The first three “Nightmare” pics, made between 1984-87 for a combined budget of under $10 million, grossed over $100 million. While other indie firms have crashed and burned on high budgets and overambitious expansion plans, Shaye has clung stubbornly to low-risk, minuscule budgets and a legendary frugal work style for employees. Secretaries used to be scolded for using New Line stationery as scratch pads.

“For so many years, we had to bootstrap ourselves financially,” Lynne explains. “Rather than going for the big score, we always tailored our business plan to meet our financial capability.”

Though New Line produced many forgettable pics in the ’80s, there were enough low-budget hit sleepers to keep the company in the black. “Teenage Mutant Ninja Turtles,” acquired from Fox under Barry Diller for $3 million, grossed $130 million, the most ever at the time for an indie pic. Both the “Ninja Turtle” and “House Party” franchises exploded New Line’s profit margins. The combined gross for these four low-budget pics was $252 million.

Shaye and Lynne have always had a long-range vision for New Line: to be in control of their production and distribution, just like a major studio. In a series of moves in the early ’90s, they formed inhouse units New Line Video and New Line Television. They also launched Fine Line Features – a specialty film division. New Line further expanded with sophisticated deals bringing them rights to Nelson Entertainment and RHI Entertainment’s large film libraries.

New Line’s next franchise came in the form of Jim Carrey, who was paid $450,000 to star in the $20 million, special effects-laden “The Mask.” Carrey then shocked the industry by getting $7 million for New Line’s “Dumb and Dumber” – the salary seemed astronomical for a $14 million picture.

New Line’s 8-year-old international department is fast expanding, recently opening a London office to help support its burgeoning network of distribution partnerships worldwide. Headed by Rolf Mittweg, the division has seen spectacular numbers on pics like “The Mask,” which out-grossed domestic in foreign release.

Shaye has plowed some of his personal wealth into a private family foundation, Four Friends, which supports the Neuroscience Institute in La Jolla, a scientific think tank run by Nobel Prize winner Gerald Edelman. Four Friends also aids Inside Out, an inner-city arts program in Detroit in which artists, writers and dancers tour the schools, and kids produce and sell an arts magazine. “It’s a way to show the kids how arts and creativity fit into their lives,” says Shaye.

Despite Shaye’s leap into the big time, he retains an indie style: He still drives a cherry red, ’72 Oldsmobile convertible. And he still doesn’t wear a tie.

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