The Hidden Million-dollar Asset Class💰
The Filmmaking Business
The business of making, marketing and profiting from feature films has been around for just over a century. Cinema was the first industrialized form of mass entertainment and even today, the Indian film industry is valued at $183 Bn, while the OTT market is estimated to reach a valuation of $120 Bn by 2023 at a CAGR of 36!
The phrase “Nobody knows anything,” which Hollywood screenwriter William Goldman coined in 1983 to describe what he saw as a clueless business, has been repeated so often as to have become accepted wisdom.
And isn't it true. Nobody really knows much about this glamourous industry famous for shadows and secrets. The commonplace perception remains to be that the industry is inherently unpredictable and prone to extreme and idiosyncratic events.
And yet, for all its volatile characteristics, the film business as a whole has been almost boringly profitable for the past hundred years — even during severe economic downturns — and it is still clearly growing at an attractive clip!
Movies have been one of the oldest alternate asset classes!
Do you know that every year 2000+ movies are produced!🤯
And the movies that break the Box Office? They see 10X + returns!
Film financing has been a closed doors affair but movie buffs and cinema enthusiasts who are passionate about being a part of the process now have a secret doorway in!
Presenting to you *drumrolls*
India's first platform for fundraising for movies & OTTs.
Hear the pitch LIVE on 4th Dec, Sunday, 12PM onwards. REGISTER HERE
But now that we have a brand new platform giving insider access to invest in Oscar-worthy movies and OTTs, what are the risks?
Market Risks and More
Films have been characterized as high-risk and complicated investments.
Since it takes so long for a story idea to end up on the big screen, who can possibly tell what will resonate with audiences two or more years down the road? Such performance risks carry over into OTTs too.
It is for this reason that film financing is generally met with skepticism. Key issues being - opaque accounting methods, cutthroat competition, soaring costs and so on. But in practice, there are many reputable banks, funds, companies and individuals that do good business committing sizeable sums to the film industry year after year.
What makes these investments worth the risk?
- Not only has the film industry remained demonstrably profitable since its beginnings but a stable core of studios have stayed dominant throughout.
- They have achieved this through their portfolio theory approach and a tight control over distribution channels. Diversify the audience and budgets of your annual output of films and much of cinema’s unpredictability is ironed out, so long as proper management controls are implemented and revenue flows are fully exploited. In any given year, different studios will be hot or cold, but over the long-term all have generally come out ahead.
- High risk means high rewards in this asset class. Take the example of Kantara. Made in just 16 crores, the movie managed to gross 306.2 crores at the Box Office!
Not to mention, with a platform like PayTamasha that can screen your deals, you should be all set to see your name rolling in the Closing Credits of an Oscar-nominated movie.
[P.S - The two-way platform allows aspiring filmmakers to fundraise for their creative projects and allows cinema lovers and movie buffs to invest in these creative projects and become a part of the process, solving two key gaps in the ecosystem!]