What comes to mind when you hear the words "Hollywood deal?" A multi-million dollar project signing a movie star? A producer getting a very lucrative contract from a major studio?
Deals like these are certainly common, but there's one deal that stands out from the rest: Cameron Diaz's "Bad Teacher" agreement. For the movie, Diaz was paid a mere $1 million to get it produced but received as back-end bonuses, a portion of box-office earnings, which secured her over $40 million for the movie. This is known as one of the most "legendary" deals in Hollywood history. It’s an increase of 3,900%!
I know you're wondering the same thing: what can we learn from Diaz's deal? Studios aren't the only ones who can make mammoth sums off of a movie. A few other actors and actresses have by negotiating a percentage of box-office earnings, being able to ensure that they would make significant profits even if the film didn't do well commercially.
For some projects and some actors, actresses and producers, it's not just about signing on for a multi-million dollar project to make money in Hollywood, sometimes, all it takes is some creative negotiation!
Overview Of The Legendary Deal That Gave Cameron Diaz A 3,900% Pay Increase
This back-end option is a gamble for actors, but it has led to some major payouts over the years. Hollywood is a business, and if a movie is successful, the actors and actresses involved want to share in that success.
In the movie business, there are a few ways an actor can get paid. They can receive a salary for their work upfront, or they can make money through back-end profits or they can get both. Back-end profits are when an actor or actress is paid a percentage of the movie's profits after it is released.
This has led to some big paydays for those who are lucky and patient enough to wait for their back-end profits to come through. And as it turns out, Bad Teacher was one of such HUGE successes, grossing over $200 million at the box office!
So not only did Diaz get her $1 million payout, but she also made a staggering amount of money from the movie's profits!
The Success of Cameron Diaz's Deal Was Tied To The Unexpected Success Of The Movie
You might be wondering how a movie with a $20 million budget made $216 million at the box office. Well, it had all the right ingredients: star power, comedy, a compelling story and great acting. For instance, the movie "The Blair Witch Project" was made for only $600,000, but it grossed over $248 million worldwide.
Cameron Diaz was lucky with her deal as she just rode on the success of the movie to line her already deep pockets. Diaz negotiated a portion of the box office earnings, and because "Bad Teacher" was such a hit, she walked away with over $40 million.
This is one of the most "legendary" deals in Hollywood history and proves that it's not always about how much money you get upfront, but about what you can earn later on.
Other Honorable Mentions Who Made Incredible Deals For Back-End Profits
When you're negotiating a contract, it's important to have an idea of what you're worth. This especially applies to artsy movies made with low budgets. Such projects usually leverage how bankable an actor is and they build the story around that actor.
In moments like this, the actor may get little to nothing on the front end of the deal and a mammoth of promises on the back end. On the off chance that it pays off and the movie is a smash hit, the actor ends up smiling like a Cheshire cat to the bank. One example of this is Cameron Diaz in "Bad Teacher".
Well, what Cameron Diaz got for "Bad Teacher" is called a “back-end participant.” This means you get paid upfront for making the movie, but then you get additional payments from any revenue the movie makes later—like in DVD sales or Box Office receipts.
You can also negotiate for a contract that includes perks like points or royalties, which are financial gains based on the show's performance. And of course, there are other ways to make money in Hollywood than acting—like writing or directing.
Before her "Bad Teacher" deal, Cameron Diaz had already started building a name for herself in Hollywood. She had started her career with a series of box office hits like "The Mask," "Shrek", "My Best Friend's Wedding," and "There's Something About Mary."
With each movie, she kept making herself a fan-favorite in those roles and continued developing her reputation as a bankable actress. This is how it starts. This is what makes them attractive choices for back-end deals. This is how she could convince the producers of “Bad Teacher" to quickly sign her on to star in and produce the film.
The deal was incredibly lucrative for Diaz, and it also solidified her status as one of Hollywood's respected actresses. Her talent and hard work allowed her to make history with a remarkable contract.
Robert Downey Jr. made $75 million in back-end profits for his role in Avengers: Endgame. The MCU gambled on Robert Downey Jr. to kicking off the franchise in 2008 with the first Iron Man film. He owned the role so much that many fans began regarding him as the star of the franchise. This was the pulling power he leveraged on to make him end up taking home as much as $75 million for his performance in the movie "Endgame".
