‘Betting on Zero’ is a truly profound documentary that emotionally explores the political and social convictions that people courageously hold, but are unable to share, due to their limited financial resources. The film, which was directed by acclaimed documentarian, Ted Braun, enthrallingly showcases how money plays a central role in influencing many components of people’s lives, including their justice system, values, social class and their sense of self-worth.
Braun once again fulfilled his mission to explore the many dimensions of an important conflict in his latest movie. Throughout ‘Betting on Zero,’ he shows how the question about how money fits in the American Dream leaves audiences pondering how the role of an effective regulatory government plays in a country’s promise to its citizens.
The helmer’s latest project premiered at last year’s Tribeca Film Festival, where it earned a special jury mention for investigative filmmaking. The independent documentary is being released today on VOD platforms, including iTunes and Amazon Video, by FilmBuff.
‘Betting on Zero’ follows controversial hedge fund titan Bill Ackman as he puts $1 billion on the line in his crusade to expose multi-level marketing giant Herbalife as a massive pyramid scheme. The investor insists that the corporation deliberately targets low-income or immigrant communities and robs them of their life savings. Ackman finds an unlikely ally in Chicago activist Julie Contreras, who rallies the Latino community to get the federal government to intervene.
In response to Ackman’s allegations, Herbalife claims the hedge fund manager is a market manipulator who’s smearing the company to drive the stock price down, so that he can make a fortune. The company is aided by longtime Ackman nemesis and fellow Wall Street billionaire, Carl Icahn. Merging tales of high-stakes corporate intrigue with working-class people caught in the crossfire, Braun paints a stirring picture of the American Dream gone wrong.
Braun generously took the time recently to talk about directing ‘Betting on Zero’ during an exclusive interview. Among other things, the filmmaker discussed how he became interested in directed the movie after producer Glen Zipper contacted him with the prospect of working on a documentary about the world of American finance and corporate conflict. After contemplating several ideas, the director felt the battle between Ackman and Herbalife would provide an intriguing story for an on-screen investigation. Braun also explained that he felt it was important to reedit ‘Betting on Zero’ after it premiered at the Tribeca Film Festival, as he felt audiences should how how the FTC ultimately decided to approach the charges Ackman made against Herbalife.
ShockYa (SY): You directed the new documentary, ‘Betting on Zero,’ which chronicles controversial hedge fund titan Bill Ackman as he puts $1 billion on the line in his crusade to expose Herbalife as a massive pyramid scheme. Why were you interested in making a feature documentary about the world of American corporate conflict? How did you become involved in directing the film?
Ted Braun (TB): I became involved when the producer Glen Zipper called me in March of 2013. Glen and I had wanted to make a film together for awhile. He said he’d been introduced to a company, Biltmore Films, that was interested in financing documentaries set in the world of American finance and corporate conflict. Biltmore had a lot of different ideas they were interested in. I zeroed in on a couple of sentences about Ackman and Herbalife, and suggested to Glen that following that unfolding battle would make a good present tense feature documentary.
I was curious about the place of money in the American Dream and surprised by the antagonists: on the one hand there was Bill Ackman, a billionaire hedge fund manager on a moral crusade, and on the other had was Herbalife, a NY Stock Exchange listed nutrition company accused of being a massive pyramid scheme. Things seemed upside down, and not at all what they ought to be.
I didn’t have an agenda. I didn’t know any of the participants. But my hunch was if we followed this conflict as it unfolded, we’d have gripping film with fascinating characters whose struggles would illuminate something about money and our times. Glen, as well as Devin Adair, the other producer on the film, and Biltmore all responded to my approach, and we decided to move forward.
SY: What was your research process like while you were making ‘Betting on Zero,’ including into the motivations and backgrounds of Herbalife and Ackman, and the many elements of their conflict?
TD: Both the hedge fund world, especially short selling, and the world of Herbalife were completely new to me. So I read everything I could get my hands on, and watched as much of the news coverage, TV documentaries and archival material that were available.
I also spoke with as many different people who were directly involved, or who had covered the conflict, as I could. Ackman made himself, and members of his staff at Pershing Square, available, so I spent time with them. I also spoke with journalists, reporters and other members of the financial community who understood short selling and did business with Pershing Square.
On the Herbalife side, I had an introduction to Michael Johnson, the CEO of the company. I spoke with him and other current and former executives, employees, shareholders and distributors. I spoke with them at length about their experiences in Herbalife, what they hoped to accomplish and how they viewed the battle with Ackman.
These conversations went on throughout filming and post-production right up until we stopped editing. It’s the kind of homework that helps me understand the contours of the conflict and make informed decisions about who to film and what to focus on. I try to see as much of what’s going on as possible, uncover and explore my blind spots, and know the subject as fully as I can. Even though none it ends up directly on the screen, it makes for a more compelling, dramatic and stimulating film.
SY: Ackman agreed to take part in ‘Betting on Zero’ almost immediately after you approached him with the idea for the film, but Herbalife declined to actively participate. As a filmmaker who makes documentaries that focus on the conflicts that are brought on by social challenges in American society, how do you find the balance of unbiasedly presenting the facts of all the conflicting subjects who are highlighted in the movie, especially if one side doesn’t wish to participate?
TB: It begins with trying to fully understand and imagine what the people on the various sides of conflict imagine they’re doing, and how they perceive the world from inside their own skin.
That’s a dramatist’s and human question; it’s not an activist’s question, necessarily, or the question of someone who wants to prove a point. But it’s a question that fascinates me and leads to the facts that shape their world view.
I think beginning with the empathetic impulse is important to us all as citizens of the planet. If we dismiss or dehumanize one set of antagonists in a conflict, we run the risk of perpetuating the kind of disregard and dehumanization that leads to these conflicts in the first place.
If one side of a conflict I’m telling a story about doesn’t wish to participate, as was the case with Herbalife, that work is harder, but it’s still possible. With ‘Betting on Zero,’ I was able to talk with people on the Herbalife side, off the record, who helped me understand what life was like from their perspective.
How did all these people involved with the company, including current and former distributors, executives and company employees, see themselves? How did successful and powerful people, as well as more ordinary folks, imagine what they were doing? When I combined what I learned from those conversations with the trove of archival material available online, I felt I could represent that perspective fairly and cinematically.
SY: What was the process of working with the documentary’s editor, Leonard Feinstein, as you were shaping the final version of the film during post production?
TB: Lenny and I worked together on (the 2007 documentary,) ‘Darfur Now,’ so we had an established creative partnership. I generally like to start editing after production’s complete, rather than midway through or as I go along. It enables me and the editor to look at the material with a bit more perspective.
Lenny and I spent about five weeks together in Los Angeles reviewing all the footage we shot, as well as a substantial portion of the Herbalife archival material we’d collected. At the end of each day, we talked about what was memorable, what we were moved by and what interested us. We listed scenes that were interesting, ditched sections that didn’t seem to hold much promise and noted material that was strong but we weren’t sure about.
Then we sketched out a scene by scene structure for the film in a somewhat old fashioned way. We used a file card for each scene, with different colored cards for each of the main character/lines of the story. Then we arranged them on a cork board until sequences emerged, and the series of scenes held our attention start to finish. After the weeks of looking at footage, that step took an additional week.
Once we had a scene by scene outline for the whole film, Lenny took a set of the cards and a drive with all the footage and went back home to work. Lenny lives in northern California, so during this phase he edited there and sent me sequences to look at.
After we’ve agreed on a basic structure, I prefer to let the editor work freely rather than sit together or look at his work each day. This way the editor’s imagination can respond to the material as openly and creatively as possible. I find it makes for a more stimulating collaboration, and Lenny likes working this way, too.
We had mirrored edit drives with the footage, so when Lenny reached a point where there was something he wanted to share, we’d review his cuts together by Skype. It usually amounted to about 10 minute sequences every week or two. I’m fortunate that Lenny works quickly and efficiently, and we were seeing the same film. Once he’d gotten to the end, he returned to LA and we worked together closely, day to day, for another several weeks. We then presented a cut to the producers and the financiers. In the case of ‘Betting On Zero,’ we hit the mark pretty closely, and didn’t have much more editorial work to do after those presentations.
SY: Three months after ‘Betting on Zero’ premiered at the Tribeca Film Festival, the FTC decided to charge Herbalife with running unfair, false and deceptive business practices, and ultimately the company agreed to pay a $200 million fine and restructure its business. You decided to include the FTC’s charge in a newly edited ending of the film following the festival’s premiere. Why do you feel that it was important to not only update the facts about the case in the film for its official release, but also highlight the overall shift in the role of justice places in protecting American citizens?
TB: It made perfect dramatic and intellectual sense to include the FTC charges and settlement. All of the major characters in the film, including Ackman, Contreras, Michael Johnson and Carl Icahn, had been waiting for the FTC to weigh in. They all felt it was going to be the decisive moment in the struggle over the future of the company.
As for justice, during the course of shooting the film, it became clear that all the participants in the battle were counting on the government, in the form of the FTC, to offer some determination about whether Herbalife was the massive fraud Ackman alleged. In that sense the film, and the FTC settlement, explores a fundamental shift from this conflict being about markets and money, in the form of a battle over the valuation of stock, to a struggle for justice in the form of one of the country’s major regulatory bodies protecting its citizens.
In the end the FTC found Herbalife in violation of the law, required them to fundamentally restructure their business, and said it was time for them to “start operating legitimately.” On first hearing Ackman had shorted the company’s stock, Michael Johnson, Herbalife’s CEO, said Ackman’s allegations were “bogus” and Herbalfe was “a legitimate company.”
But the FTC found Ackman’s allegations truthful, not bogus. They said Herbalife needed to “start operating legitimately,” unequivocally implying that Herbalife was not a legitimate company. It would have been irresponsible, intellectually and dramatically, to ignore that damning assessment. That’s why we updated the film.
SY: ‘Betting on Zero’ is built around a presentation Ackman gives that condemns Herbalife as a pyramid scheme. Why did you decide to structure the film around that one presentation? How did it influence the trajectory of the rest of story you included in the movie?
TB: I’d originally envisioned a film in which we were following characters on different sides of an unfolding present tense conflict. But when Herbalife declined to participate, I had to rethink the storytelling approach.
The solution to bringing Herbalife’s perspective into the film lay in the trove of archival materials and interviews that were available. But I still had to find a new way to structure the story.
We had filmed Ackman’s disastrous Nutrition Club presentation, and it had an incredible dramatic trajectory. he claimed he was going to deliver a death blow, BUT instead Herbalife stock price had the greatest single day gain in the company’s history.
I thought that would provide a good framing question-will he deliver the death blow? I felt that question would hold viewer’s attention and deliver a satisfying and surprising result. It also afforded us a natural way to bring out the expositional information behind his arguments and the company’s counter arguments. Most importantly, it revealed Ackman as a complex fascinating character, and got the viewer deeply engaged with the question of whether he’s right or wrong.
Within that frame, I could then focus on other characters, including Christine Richard, Julie Contreras, Julio Ulloa and Zack Kirby, who were trying to understand what the company was about. I had no idea about the outcome, or who was right, but that structure provided a natural way to invite the viewer into journey to uncover the truth.
In that sense it gave us the freedom to continue to follow the action as it unfolded, and even after we thought we were done, to include the results of the FTC investigation. That the FTC complaint and the settlement so closely mirror the experiences of the characters in the film and the arguments made about the company is a tremendous validation of our approach. It makes for a dramatically satisfying ending.