William Morris Kills Investment Fund

Ari Emanuel considering new strategy for financing deals

It’s been two years since William Morris Agency merged with Endeavor, but Ari Emanuel is still cleaning house. Just before the merger, WMA had launched a $30 million to $50 million investment fund co-managed by venture firms Accel Partners and Venrock, along with heavyweight partner AT&T. Called the Mail Room Fund, the vehicle backed three digital media companies totaling no more than $5 million.

Now with only a tiny fraction of its capital deployed, William Morris has pulled the plug. According to a report on Fortune.com, the Mail Room Fund is no longer making new investments. It’s a direct result of the merger: when Emanuel took the helm of the new William Morris Endeavor, he pushed out the old guard, including two of the Mailroom Fund’s managers: Richard Wolpert and Paul Bricault. Wolpert landed at Accel; yesterday venture firm Greycroft Partners announced it had hired Bricault as a partner in its Los Angeles office.

The three Mail Room Fund investments are still managed by Wolpert from his new perch. No word on the fate of the fund’s remaining capital, but it was more than likely returned to investors. Wolpert didn’t respond to calls from Adweek.

But just because Emanuel shut down the Mail Room Fund doesn’t mean William Morris Endeavor is out of the investing game. Emanuel is considering an investment program of sorts at the firm, Fortune reported. This year the firm invested in (or co-founded, depending on which report you read) Hollywood merchant bank Raine Group, founded by two former media investment bankers. Raine Group recently backed Vice Media alongside WPP and Tom Freston; William Morris did not invest in the deal directly, but the firm created a “strategic partnership” with Vice wherein the firm will represent the hipster media company. Raine’s other deals include social shopping company OpenSky and Jagex, an online gaming company.

Essentially WME has eliminated a formal digital media fund, backed by the two venture funds and AT&T, in lieu of making indirect digital media plays on its own. The question of whether the firm will formalize its investment efforts or simply continue as an investor/landlord/advisor/cofounder of Raine Group is unclear.