There are numerous facets that one should take into consideration when looking to invest in a movie. Most of the time, outside investors commonly will invest in indie movies. This is because the major motion pictures that bigwig production companies sign off on are generally already vested from the company and outside investors, or well known – and generally well off – executive producers. While it is possible to invest in a major motion picture, a lot of investors find that indie movies are more lucrative because they require fewer dollars up front, and offer a more satiable return on investment over the big name production studios. If you have ever considered the propensity of financial return that you could enjoy when you invest in a movie, the following tips can serve to help get you started.
Five Simple Tips on How to Invest in a Movie
- Ponder why you want to invest in a movie. Are you sure you want to do this? You want to keep in mind that there is risk involved, and there is no guaranteed return on investment. But a substantiated risk can many times pay off in the form of big returns on ticket sales and on merchandising as well as on DVD sales.
- Indie movies are considered to be a non correlated asset class investment. In fact, film and film finance have consistently outperformed other types of investments like hedge funds and retirement funds, spurring a higher return on investment overall.
- Increasing portfolio diversification. If you are managing a large investment portfolio, when you invest in a movie, you can expand and diversify that portfolio and make it more attractive as well as increase its returns.
- It can be a winning lotto ticket. Over the past ten years, some films have seen resounding success from minimal upfront investment. For example, “Blair Witch Project” cost $60,000 to produce, but netted millions at the box office in returns.
- Get ready for the negativity. A lot of people are naysayers with regard to those who want to invest in a movie. Even if a movie is not your typical brick and mortar investment, look to advisors that are familiar with film financing to get the real answers.
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As Hollywood invests billions of dollars each year for movie production, where does Canada stand as far as investing in producing and shooting movies in Canada? Obviously Canada isn’t as large as the United States and doesn’t have the same budget, but investments are growing larger and are rating higher and higher on the sliding scale of financing.
Telefilm Canada recently announcedit was launching a $5 million private film fund. This is great news for indie film producers, who normally favour foreign funding. The idea is to secure private investors, mainly from the corporate world, who would usually sponsor Canadian film festivals rather than betting on local movies for potential earnings. Telefilm Canada is already Canada’s largest film financier, investing around $100 million annually in a domestic film industry, which remains highly dependent on tax credits and cultural subsidies. With more and more movies produced on Canadian soil, it’s no surprise that Canada saw an overall production rise of 8.9% to a new record of $5.49 billion last year.
Goldrush Entertainment inc. proudly offers production services to third party film productions being shot in Quebec, Canada. Goldrush is there to assist with every aspect of production such as the hiring and negotiation of studio and laboratory facilities and services, personnel, equipmentand supplies to name just a few. Basically they take the guess work out of film production. Goldrush also offers equity financing.
Producing or shooting movies in Montreal is growing in popularity, how could it not? Not only does the city offer a beautiful backdrop in the Old part of the city, Old Montreal, but it also boasts a massive studio called Mel’s, La cité du cinéma. Many big time titles have been shot in part at these studios such as Oscar winner The Aviator starring Leonardo DiCaprio which grossed over $213 billion worldwide,The Curious Case of Benjamin Button starring Brad Pitt and Cate Blanchett and the ever popular 300 starring Gerard Butler , grossing an impressive $456 billion worldwide, just to name a few.
Independent films likeCall of the Wildand Beautiful Boy produced by Lee Clay and Eric Gozlan of Goldrush Entertainment Inc.May not have multi-million dollar studio budgets but for independent films they have fared extremely well.
So what does the future hold for film investment in Canada? Well if more companies like Telefilm Canada would put forth special funding for independent film productions, then the future of Canadian film productions would certainly shine a little brighter and would encourage more producers and production companies to continue their efforts to bring us homegrown entertainment.
You can get more information about Film Investment, Movie Investing News by visiting Movie Production
