What future awaits film financing? The panellists at Cannes Next have their say
- CANNES 2022: Following the announcement of MediaInvest, the event covered new financing models such as the blockchain-based Decentralized Pictures and XYZ Films’ “transatlantic model”
On 20 May, Cannes Next hosted a 90-minute panel titled “Future of Financing Summit: New trends in Equity, Venture Capital, tokenized film investment, NFT’s and beyond” and moderated by AC Coppens.
Coppens introduced the speakers, namely Logical Pictures Group and Cascade 8’s Yannick Bossenmeyer, XYZ Films’ Maxime Cottray, Decentralized Pictures’ Leo Matchett and Michael Musante, Zoan’s Laura Olin and NFT Studios’ Hewie Rattray.
Musante and Matchett talked through the activities of Decentralized Pictures (launched at last year’s edition of the Marché du Film) and its mission to support independent filmmakers. The idea at the core is to use blockchain “to find talent from all communities by using a fair, democratic and transparent protocol” with a portion of financing dedicated to voices who don’t have enough “representation and amplification” alongside “a reward system to incentivise participation in the curation process”.
Cottray compared two production models. The first is the “Anglo-American” one “where you come to Cannes, you pre-sell, you bank these presales and then you shoot your movie with some tax credits,” which, he argues, is harder and harder to implement. The second is the European model, supported by a great funding system. However, it is geared to support more mainstream titles, leaving little room for genre films, which are the ones “that can travel best” as they tell “global stories”.
European producers are therefore forced to finalise financing by “begging and praying” private investors or striking a deal with a multinational streamer: “You become just a glorified gunfire, becoming a service producer but you don’t own anything.” Cottray proposed a new “transatlantic model,” where one can cherry-pick the best of both worlds. In it, productions would be still rooted in Europe, physically produced in Europe with a lot of talent behind the camera being European – so that they can be in receipt of European funds – but with extensive work done with an American partner to navigate the agency system to bring an actor who can bring global recognition to the flick as well as a good distribution and sales partner.
He then spoke about how such model is applied to the joint fund managed by XYZ Films and IPR.VC: “We take movies from filmmakers we like; we package them by mixing European and American cast, we shoot and post them in Europe but we use the ‘American sales model.’ An example we made is Riley Stearns’ Dual, entirely shot in Finland, set anywhere and not location-specific, where we brought Aaron Paul and Karen Gillian in the cast.” The production also benefited from the national and regional tax credits in Finland.
Later, Rattray spoke about NFT Studios, set to be “the first Web3 production company,” whose primary mission will be “transforming the existing paradigm through which media is created using web3 technologies.” NFT Studios promises to facilitate a new era of community-driven creative freedom by modernising financing processes, providing creators with a highly composable platform (where they can fairly share work and rights) and leveraging the collective strength of a Web3 native community for content creation and governance.
Next, Olin spoke about Cornerstone, a photo-realistic metaverse project previously introduced by Mikka Rosendahl at the Marché. She highlighted how this new virtual environment can offer promotional and funding opportunities through carefully planned NFT drops and exchanges, metaverse releases and fan meetings.
Lastly, Bossenmeyer touched upon the activities of Logical Pictures, Logical Content Ventures and Cascade8. The first focuses on equity financing against international rights, ideally on projects shot in English and with international outreach, “budget efficient” and with “optimised subsidies”. The initiative backed 20 features, including Pleasure [+see also:
interview: Ninja Thyberg
film profile], The Deep House [+see also:
film profile] and Revenge [+see also:
interview: Coralie Fargeat
film profile]. The second is a fund launched last year aiming to finance $50 million of new content. To date, $10 million were raised through private investors and family offices. Some of the projects supported by Logical Content Ventures include Tchaikovsky’s Wife [+see also:
film profile], The Dive [+see also:
film profile] and Blazing Neons (Du crépitement sous les néons) (read news). The fund is characterised by tokenised assets, with the investment secured by two remuneration components – an annual yield with a return rate between 4-6% and a capital gain with a library of approximately 150 titles over the next eight years. Finally, Cascade8 aims to develop blockchain and software solutions for entertainment industry professionals. In particular, Bossenmeyer spoke about the division’s long-term roadmap and its work on Blood Machines, where NFT buyers can gain ownership of virtual collectibles, based on the film’s characters, spaceships and weapons.
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