An investment fund for High Net Worth Investors Thinking Of Movie Finance
Okay, you woke up one day, checked your Swiss bank account, called family office planner, had breakfast with your private asset managers of the clients, have your accountant on the phone, and three of you decided to invest your proceeds latest from the merger or acquisition, companies not in some dubious hedge fund or start-up biotech companies, but the Hollywood film financing, because the value, you need the state tax credit, the Federal Tax AdministrationDepreciation, as well as a nice hedge of revenues from the movies.
Now, this may at first fund manager is not too well with your neighbors in Connecticut and hedge your oil and gas investor friends in Bahrain or Dubai ring, but are not the same guys who finance Hollywood blockbusters are ? And the only question to you as you get into the game without feeling like the uncle of the film school student, the grandson wrote a check for a million dollars movie to be playedfellow department and as a free download on youtube.com as well?
So after I share your work, here's what you might be able to find Spice up your life rich but boring
* Sergey Brin and Larry Page of Google, Fred Smith, CEO of Federal Express, Norman Waitt, co-founder of Gateway computer, eBay's Jeff Skoll, Todd Wagner and Marc Cuban (ex broadcast.com), Max Levchin and David Grodnick PayPal , Marc Turtletaub Money StoreRoger Marino from EMC Corp, former Chicago Bulls co-owner Jim Stern, Sidney Kimmel of Jones Apparel Group, Minnesota Twins owner Bill Pohlad; Developers Tom Rosenberg, Bob Yari, and financiers Robert Sturm, Sheikh Waleed Al Ibrahim, Zeid Masri Silverhaze Partners, Michael Singer, Mark Esses, David Larcher, Michael Goguen, Richard Landry, Michael Reilly, Rafael Fogel, and Philip Anschutz are just a handful of high net worth entrepreneurs who have signed the film and financeproduction companies with successful results.
* There are various tradeable state, federal and international tax credit incentive, a prize of a location would provide an equity basis. Provided there is a 10 million dollar budget film, where 50% of them in action and 50% is guaranteed by the international distribution prior to publication. Take now there is a tax credit of 20-25% of the total 10 million U.S. dollars, resulting immediately in 2 to $ 2,500,000 tax creditan investor.
* Numerous hedge funds such as Reed, Conner and Birdwell (Disney), Legendary Fund (Warner Brothers), Melrose Fund (Paramount Pictures), a brilliant float Media $ 700,000,000 on AIM in London, Benjamin Waisbren Investments, and a host of other assets and fund managers are in the Finance film.
* The explosion of international DVD, pay-per-view, home video, cable, megaplex theaters, the future of Internet downloads, multilingual video-on-demand, andcross-market digital distribution including low-cost theatrical digital projection, the movie industry in an unprecedented growth accelerated.
* The American Jobs Creation Act of 2004, the Internal Revenue Code has changed since 1986, has been put in place. The law establishes three specific tax incentives for motion pictures, one of which - § 181 of the Internal Revenue Code - is especially important for independent film producers and their passive investorsQualifying films with budgets less than $ 20 million dollars.
* The video and other entertainment are constantly meet and beat analyst expectations in terms of growth, and are the only industries resistant to untimely global events and adverse economic conditions.
* Movie Investor returns may be cheaper and more liquid equity positions in most live performances and other public enterprises, investment in real estate and alternativeInvestment.
* There is a strong demand, audience, and growing distribution structure for specialty independent, crime, horror and other low-budget films as the success of films like "Brokeback Mountain," "Sideways," "Capote," Copy "Garden State" "Napoleon Dynamite", "Y Tu Mama Tambien," "My big fat greek wedding", "Memento," "Crash," "Saw 1 & 2, Friday the 13th" "Halloween," "Texas Chainsaw port "" Hostel "and" Wolf Creek "which was made for $ 800,000, purchasedfor nearly $ 4 million before the issue of size, as well as "Hustle and Flow" was made for 2 million U.S. dollars and bought for $ 16,000,000 by Paramount Pictures.
* In addition to hits like "King Kong", "Harry Potter" movies and other large-scale studies have been widely produced films the studios to run at the box office. The films that have been successful for studies of all externally funded and / or co-financed with studios, sold for 2-3x their costs, and most retained foreign sales rights to maximize revenues.
So, after looking at all the great benefits as yet to visit a project agreement or a film, you are sure that half of your money will not be used by a Hollywood producer as a down payment on a new villa in Pacific Palisades ?
The key that separates the successful film financiers of oil magnates who are beginners in Los Angeles with a bag full of money and at the endLeave half a bag full of money means different things: structured finance, leverage, risk minimization, multiple exit strategies, tax credits, and the ethical conscience of the director / producer.
What does this mean for you in a real-world scenario. Lets say you want 100% of the film $ 1,500,000 dollars to low-cost, whose worst kind, a DVD and profits from international sales and perhaps some other sweeteners in the translation of financial investmentssecurities which you have subscribed as part of the deal. Well, if you write a check for $ 1,500,000, and the film in a state that has shot 30% in tax credits, you get back $ 450,000 in tax credits under § + 181 amortize this amount Chancellor can. They are therefore already a nice return, before the profit figure then sell the film in 50 countries, and if you're lucky, it sells for 3-4 times the film does a swanky apartment in a festival kick in.as Sundance, Toronto, Cannes, etc. Do this for 5-10 and movies can be very useful to make a name among the elite of Hollywood.
But is it really a step forward and see how older kids lever cinema, because it can be a bigger star, which can translate into higher sales abroad, the investment. Take a director / producer and a film of 10 million U.S. dollars in the action yourself. They will receive $ 5,000,000 in shares of Park, a tax credit of 20-30% to $ 10,000,000, which iswill be $ 2 - $ 3,000,000, the producer of the biggest stars who can get to get a studio to $ 5,000,000 in additional $ football, you wont ever worry about a penny from the stage version, for your DVD -profits and international sales expertise will cover your capital base. Sense?
Now I use this with different budgets, genres, stars, the distribution, the places where there are high tax credits (Puerto Rico is 40%), other exit strategies, where you get your actions on whichLondon AIM, and you are on your new career as a film financier, sophisticated and cultured. Off course, if you go further and guarantee of 100% of the capital there are tricks to that, too.
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