Film futures provides new way to finance movies

Two film futures exchanges are coming soon to a stock market near you. I can’t decide what to make of it, but I think this is something to watch.

If you’re like me, you’re probably aware there are “corn futures” and “wheat futures” and it all has something to do with the stock market, but you don’t understand it in any detail. The upshot seems to be that by purchasing or selling (shorting) futures on particular films, you’re betting the film will or won’t make money. And the sales of these futures would go to finance movie-making. Futures helped farmers mitigate losses and fund all the work that happens before you even get a crop to take to market. The folks involved in this hope that film futures will spread out some of the financial risk that goes into making every single film. And that risk is substantial, even in the least expensive films. (Which is why if you ever, ever, ever comment on this website that women should either start making their own movies or stop complaining about what’s out there, I will ban you so fast your head will spin. We don’t all have even the $77k it cost to make Blair Witch Project ten years ago laying around, trust fund asshat.)

While futures have kept farming profitable, or at least alive:

The bigger question, however, is whether Cantor and Veriana can persuade professionals in the insular entertainment business to adopt the type of complex financial tool that, as evidenced by the recent mortgage meltdown, doesn’t always work smoothly.

Film executives not seeing the smart money when it requires them to adapt? Oh, how could that happen? And how could that happen again? And again? And again? And has there ever been a better time to experiment with making movies for the new 55% demographic – women?

An interesting note from the above-linked article:

The surge of private equity money into the movie business a few years back has dried up because returns were uneven and often lower than promised.

So financiers are finally discovering what people like William Goldman figured out a long time ago: Hollywood doesn’t know what makes a successful film. They just know how to sound like they do, and how to sabotage and explain away successes that don’t fit the mold. They have a vested interest in that.

I dunno. Seems to me film futures could strip away the last layer of resistance to adaptation. The film industry has really enjoyed doing exactly the same damn thing every day for thirty years and getting huge returns for it. We all knew it would take a major financial blow to the industry to get them even to consider that maybe the audience is changing and the industry has to change with us or die. I’m not too hopeful anyone’s thinking will really change – I’ve studied human psychology a  bit – but, hey, the Baby Boomers have to retire eventually, and maybe that’ll shake up the demographics of the industry thinkers. I’m not putting down the Boomers – sexism exists in younger generations, too, including mine – but I don’t think growing up in an era where female CEOs, lawmakers, etc. barely existed did them any favors in terms of seeing women as equal fellow human beings.

Comments

  1. Anemone says

    I wouldn’t invest in the current crop of movies if it were my money. I just don’t trust film culture right now, in either the US or in Canada. Too many things wrong with it. And I really don’t think the powers-that-be can change. However, I think there are people out there on the fringes who could do things differently, if only they had the resources. Then the establishment would be forced to scramble to keep up.

    It would be nice if film futures helped with that, but I don’t see it happening. I think the money would keep going to the wrong people. But then I want a paradigm shift that’s much more than just more women and visible minorites, too. I want a complete ethics overhaul.

  2. Elee says

    Yeah, my thoughts exactly. Film futures could be a useful instrument to ensure funding of the films we really want to see, but it would only work, when that money came directly to people involved with the actual film. And how many of them are financially stable enough to have someone involved only with stock market finances most of the time, if not the whole time? As long as stock market isn’t the only way to ensure funding, they will always need the traditional funding and all the decision makers who want and do influence the final outcome. But it sure is nice to imagine, that my money would count in the end result and that one or two flops will make it a matter of survival for a filmmaker to examine what exactly is wrong with their work.

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