Read about how Wall Street funds the indies
Fourteen months ago, Mark Gill was in Cambridge, Mass., as keynote speaker at the Harvard Business School's annual conference on media and entertainment. He struck up a conversation with another guest, Yael Taqqu, a partner in McKinsey & Co.'s global media and entertainment practice.
Taqqu suggested that Gill call her if he ever went out on his own. "What do you know", Gill reflected wryly, "a month later, I did."
That was the beginning of a yearlong odyssey for the specialty movies executive as he exited his post as president of Warner Independent Pictures and sought to raise money for a new production and worldwide sales company, the Film Department. And it led him directly to Sheikh Waleed al Ibrahim of Dubai.
Today, Sheikh Waleed is one of the key backers of Gill's company, investing millions of dollars in the venture. (Gill declined to say precisely how much.) In plunging into filmmaking, the media magnate, who also is chairman of powerhouse network MBC (Middle East Broadcasting Center), is one of a number of foreign individuals and companies who are dipping their toes into independent American film.
"We used to see foreign money coming from (tax-driven funds) like Ingenious that would make investments in studio pictures; and, of course, we would see German tax money make investments, but aside from that, not much -- maybe a few investments from high-net-worth individuals from time to time," said John Burke, an attorney with Akin Gump who specializes in film finance. "What we have seen in the last six months or a year is an increased interest by the European institutional community -- the hedge and equity funds and investment banks -- and an increasing amount of attention from the Middle East, meaning places like Dubai and Abu Dhabi, Saudi Arabia, Jordan -- any place where there are significant amounts of wealth."
Among recent developments:
Producer Hunt Lowry has been negotiating with investors in Abu Dhabi to finance a whole slate of studio-budget films.
Harvey Weinstein went to China this year as one step in an ongoing attempt to raise $285 million to make Asian-themed movies that will be released through the Weinstein Co. in a deal that Goldman Sachs is putting together. (Reps for the Weinstein Co. declined comment.)
Wild Bunch, a major French production and distribution company, has invested in such independent films as Steven Soderbergh's upcoming pair of feature projects about Che Guevara and three Woody Allen movies. It also has signed a first-look deal with former Miramax staffer Agnes Mentre to find U.S. projects in which it can invest.
Double Edge Entertainment has accessed Taiwanese and Chinese money through its principals, Nina Yang and Bobby Sheng, who have invested in such films as director Vince Di Meglio's upcoming Dax Shepard-Mike White starrer "Smother" and 2004's "Mail Order Wife".
Producer Marina Grasic of Visitor Pictures has raised money from investment funds in Bahrain and Scandinavia to help finance four films (Miramax's planned 2007 release "Smart People", writer-director Rawson Marshall Thurber's upcoming "The Mysteries of Pittsburgh", Lionsgate's planned December release "The Return" and writer-director Baillie Walsh's upcoming "Flashbacks of a Fool".)
Bill Block, CEO of production and sales company QED International, is visiting Beijing this summer to meet with investors there. His company already has benefited from funding from U.K.-based Aramid Capital.
Russian billionaire Michel Litvak has funded several films, including 2006's "Bobby", through his Los Angeles-based company Bold Films. Other Russian billionaires investing in Hollywood include Len Blavatnik.
It would be wrong to overstate the level of this cash influx. Insiders put it at a total in the hundreds of millions, not billions.
"I spent a year of my life dealing with this and talked to people around the world," Gill said. "They all said the same thing: Here and there, there are little pockets of money, but most people (outside the U.S.) would prefer to invest in real estate or bonds or something more reliable than the movie business.
Fourteen months ago, Mark Gill was in Cambridge, Mass., as keynote speaker at the Harvard Business School's annual conference on media and entertainment. He struck up a conversation with another guest, Yael Taqqu, a partner in McKinsey & Co.'s global media and entertainment practice.
Taqqu suggested that Gill call her if he ever went out on his own. "What do you know", Gill reflected wryly, "a month later, I did."
That was the beginning of a yearlong odyssey for the specialty movies executive as he exited his post as president of Warner Independent Pictures and sought to raise money for a new production and worldwide sales company, the Film Department. And it led him directly to Sheikh Waleed al Ibrahim of Dubai.
Today, Sheikh Waleed is one of the key backers of Gill's company, investing millions of dollars in the venture. (Gill declined to say precisely how much.) In plunging into filmmaking, the media magnate, who also is chairman of powerhouse network MBC (Middle East Broadcasting Center), is one of a number of foreign individuals and companies who are dipping their toes into independent American film.
"We used to see foreign money coming from (tax-driven funds) like Ingenious that would make investments in studio pictures; and, of course, we would see German tax money make investments, but aside from that, not much -- maybe a few investments from high-net-worth individuals from time to time," said John Burke, an attorney with Akin Gump who specializes in film finance. "What we have seen in the last six months or a year is an increased interest by the European institutional community -- the hedge and equity funds and investment banks -- and an increasing amount of attention from the Middle East, meaning places like Dubai and Abu Dhabi, Saudi Arabia, Jordan -- any place where there are significant amounts of wealth."
Among recent developments:
Producer Hunt Lowry has been negotiating with investors in Abu Dhabi to finance a whole slate of studio-budget films.
Harvey Weinstein went to China this year as one step in an ongoing attempt to raise $285 million to make Asian-themed movies that will be released through the Weinstein Co. in a deal that Goldman Sachs is putting together. (Reps for the Weinstein Co. declined comment.)
Wild Bunch, a major French production and distribution company, has invested in such independent films as Steven Soderbergh's upcoming pair of feature projects about Che Guevara and three Woody Allen movies. It also has signed a first-look deal with former Miramax staffer Agnes Mentre to find U.S. projects in which it can invest.
Double Edge Entertainment has accessed Taiwanese and Chinese money through its principals, Nina Yang and Bobby Sheng, who have invested in such films as director Vince Di Meglio's upcoming Dax Shepard-Mike White starrer "Smother" and 2004's "Mail Order Wife".
Producer Marina Grasic of Visitor Pictures has raised money from investment funds in Bahrain and Scandinavia to help finance four films (Miramax's planned 2007 release "Smart People", writer-director Rawson Marshall Thurber's upcoming "The Mysteries of Pittsburgh", Lionsgate's planned December release "The Return" and writer-director Baillie Walsh's upcoming "Flashbacks of a Fool".)
Bill Block, CEO of production and sales company QED International, is visiting Beijing this summer to meet with investors there. His company already has benefited from funding from U.K.-based Aramid Capital.
Russian billionaire Michel Litvak has funded several films, including 2006's "Bobby", through his Los Angeles-based company Bold Films. Other Russian billionaires investing in Hollywood include Len Blavatnik.
It would be wrong to overstate the level of this cash influx. Insiders put it at a total in the hundreds of millions, not billions.
"I spent a year of my life dealing with this and talked to people around the world," Gill said. "They all said the same thing: Here and there, there are little pockets of money, but most people (outside the U.S.) would prefer to invest in real estate or bonds or something more reliable than the movie business.
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