Even including successful lottery ticket purchasers, Merv Griffin had one of the most profitable minutes in the history of the civilization. You may recall the fortune that he made through his creation and majority ownership in various American game shows, which most notably include Wheel of Fortune and Jeopardy.
As brilliant as Griffin was as a gameshow producer, he was just as shrewd when it came to operating his intellectual property.
In a 200 interview with the New York Times, Griffin indicated that he spent less than a minute creating the famous “Think” song that plays during the final question in Jeopardy. It was a lullaby for his son that he used as a placeholder while searching for a more official song.
Griffin never got around to changing the song, though he did bother to perform a company that consisted of nothing but the intellectual property for the song. As the majority shareholder of a separate corporation that owned the Jeopardy game show, he arranged for a royalty rate that was well below the market average to dodge conflict of interest concerns for the lack of arms-length transaction.
During the first season of Jeopardy, CBS offered to pay $150,000 in exchange for the holding company that held Griffin’s theme song. Griffin said no.
In a 2010 interview, Griffin estimated that he had earned approximately $80 in royalties from the Jeopardy song alone. If CBS had gotten its hands on the song, it would have earned 16% annual returns (to get an idea of the enormity of decision, if CBS had owned the Jeopardy song during the 2009 recession, its earnings would have improved by 1.5%. That is staggering–a broadcast television corporation with an almost century-long track record would have had its annual success measurably improved by the inclusion of a doo-doo-song that was written in the amount of time it takes an average American to pump a tank of gas).
This is also a reminder of why and how it seems that the rich are always able to create more money seemingly out of thin air. It was a tremendous competitive advantage that Griffin was able to evaluate CBS’ offer rationally. That sounds basic, but should not be taken for granted.
What is that data point? Something like over eighty percent of Americans consider $10,000 to be a life-changing amount of money. A suitor showing up waving cash can induce a lot of irrationality in a hurry if you have a present need for the funds. Your first duty, if you seek affluence, is to put yourself in a position where you don’t have to make decisions that prioritize the short-term over the long-term in order to survive.
Originally posted 2018-07-18 01:20:22.