Chapter 856: Platter

This trip to the United States has a very important purpose, which is to investigate. Before the unprecedented economic crisis arrives, let's examine the environment in the United States so that we can get rid of the wool in the future.

This is a once-in-a-lifetime opportunity.

One of them is the entertainment industry.

Jieyu Media plays a pivotal role in Zhou Buqi's industrial planning. Step-by-step development, a bit too slow. As Xu Baihui said, the several reality shows launched in cooperation with Yanjing TV are quite profitable, but their influence in the industry is not great.

To do this business, you still have to rely on movies.

But these days, the domestic film market is still far behind and has not developed. In this case, it is better to come to Hollywood to inquire.

The impact of the subprime mortgage crisis is huge, and it has a great impact on any industry.

And of course Hollywood.

Zhou Buqi has nothing to do with Hollywood, but Hua Yi does.

Two years ago, Hua Yi signed a big contract with Hollywood's Legendary Films, saying that he might co-produce no more than 40 films in the next 7 years.

Zhou Buqi relied on Hua Yi's relationship and contacted Thomas Tull, the boss of Legendary Pictures.

The two met at the offices of Legendary Pictures in Burbank.

Thomas is not a millionaire.

He was originally a tax lawyer, because in the process of dealing with taxes, he met many rich and wealthy clients. Then he discovered that the film was a tax haven, so he contacted some of his big clients, persuaded them with a three-inch tongue, raised 500 million US dollars, and established Legendary Films.

That is, he is a wealth manager.

Kind of like a fund manager.

Earn income by helping others manage wealth without spending money yourself. The more wealth you manage, the more income you can earn. Hearing that the visitor was a rich man who was interested in the entertainment industry, Thomas showed his greatest enthusiasm.

He planned to persuade the young boss Zhou to invest in Legendary Pictures with money.

Then, he talked endlessly, as if convincing previous investors, he described his grand blueprint for movie platter investment.

"Mr. Zhou, in fact, investing in movies is the same as investing in stocks. There is an investment philosophy with controllable risks. This is an analysis method based on probability and statistics theory, called Monte Carlo simulation..."

"Sorry to interrupt."

Zhou Buqi was very helpless.

After all, it is a foreign language. If he is in the technology circle, he can communicate relatively freely. After crossing industries, many words are hard to understand. He still brought Sister Bao with him.

Sister Bao simply acted as an interpreter for him.

Thomas saw that his English was not very good, so he stopped speaking professionally and slowed down a lot, "As we all know, investing in movies is too risky. Especially for laymen like us who want to ensure that movies It is too difficult for the project to be successful. However, the risk can be minimized through the investment portfolio, just like hedge funds, which can make the volatile stock fluctuations into relatively stable annualized returns."

"Really?"

"That's right, according to the model calculation, when the number of film projects invested in the film reaches 20-25, the volatility of investment income will be relatively small. The annualized rate of return of general hedge funds is between 12% and 18%. But If you invest in movies, the annualized rate of return may reach 20%. If you encounter blockbuster movies such as "Titanic" and "Spiderman", the rate of return may reach 30%. Even in a bad year, the rate of return may be 20%. It can reach 15%. It also meets the income requirements of hedge funds.”

"Is it accurate?"

Zhou Buqi's eyes were bright, and he looked very interested.

Thomas smiled and said: "I have repeated this set of homework for several years, and the data is not wrong. Another very important point is that the tax rate will be high when investing in other industries. But movies are different. The tax rate for movies is low, and there are All kinds of policy subsidies and tax rebates. This is another reward.”

Zhou Buqi nodded, "Is there any specific case?"

Thomas said: "Paramount launched this plan in 2003, in cooperation with Merrill Lynch. A total of 25 films were invested in Paramount, with an average annual return rate of 20%. This example proves that Wall Street’s investment theories can be adapted to Hollywood. Over the years, Merrill Lynch, Lehman, and many private equity funds have participated in the investment plan of Hollywood movies, and more than 13 billion US dollars have entered Hollywood.”

Zhou Buqi asked, "Have the six giants participated?"

Thomas smiled and said: "Almost, basically all participated. Two months ago, Fox and Dune Capital renewed their third investment agreement, and another 500 million US dollars of funds entered the platter of investment."

After speaking, he called the secretary and said something to her.

After a while, the beautiful blonde secretary came over with a document.

Thomas handed the document to Zhou Buqi.

This is a list of Wall Street Capital participating in the Hollywood platter investment plan in the past few years, and the momentum is very strong!

In January 2005, Fox signed a first-phase investment agreement with Dune Capital, investing US$325 million in 28 films; in December of the same year, Dune Capital increased its capital by US$325 million and participated in Fox's investment in 16 films.

In June 2005, Warner Bros. cooperated with Legendary Pictures. Thomas Tull directly invested in Warner's camp with the 500 million U.S. dollars he had just flicked over, and participated in the investment of such masterpieces as "Batman" and "Superman".

In September 2005, a Swiss credit bank invested 370 million US dollars and cooperated with Disney to participate in the investment of 32 live-action films under Disney.

In 2006, Universal Pictures, Paramount, and Sony also participated successively, and Hollywood's platter investment plan was vigorous.

Even the cooperation between Huayi and Legendary Pictures is also a platter investment model.

Huayi paid a little money, with very little equity and no real power. But being able to be named in a Hollywood blockbuster, this brand image has been made public.

After reading this material, Zhou Buqi was determined!

Done!

Xu Baihui's movie dream has come to an end!

These funds that come to Hollywood to participate in platter investment projects either come from banks or private equity funds. One of the characteristics of such an institution is that the source of funds is relatively stable.

So they can spend enough money to invest in long-term projects such as movies. For Hollywood movies, the release cycle is usually 5-7 years.

However, next year is the subprime mortgage crisis!

The two industries most affected by the subprime mortgage crisis are banks and private equity funds!

In the global monetary tightening, the primary purpose of banks is to survive. Some banks went bankrupt or were acquired by mergers and acquisitions if they failed to withdraw funds in time.

The same is true for private equity funds, which are under tremendous pressure for redemption.

But movies are a long-term investment, and the longer the time, the more you can earn. If you can't withdraw in a short period of time, you can only dump at a low price and find someone to take over... It is conceivable that by next year, most of the film shares in these platter investments will face selling.

But no one can eat the platter pool of tens of billions of dollars.

In the end, it can only be broken legs.

Most of the films died prematurely, and a small number of high-quality film shares were collected by the rich at super low prices.

This is Jieyu Media's opportunity!

Huayi has a great reputation.

Qualified to sign a big contract with a Hollywood studio.

Jieyu Media does not have this qualification, but as long as they have money, it will do. By next year, Hollywood movies will be free to pick and choose.

At that time, with the equity in the movie, a few artists from Jieyu Media will be properly arranged in the movie, and they will play a small role... In China, they will be international movie stars, and their popularity will skyrocket!

Seeing that he was silent, Thomas explained further: "Recently, Universal launched another platter investment project, and is willing to take 75% of the equity of 40 films and absorb 1 billion US dollars. Now there are many private equity funds vying for it. Entering the market. Well, you know, the subprime mortgage crisis is very severe, and the whole world is pouring water. So much hot money is flowing into the market, and capital institutions are frantically looking for investment projects. Hollywood movies are rare Investment Products."

Zhou Buqi looked at him amusedly, "Do you want to cooperate with Universal?"

Thomas smiled, "If Mr. Zhou is interested, I can help you take the lead."

Zhou Buqi remained calm and asked, "This film equity is not a film copyright, right?"

Thomas looked a little embarrassed, "Yes, it's not the copyright. The copyright belongs to the film company. Equity means more dividend rights. If the film is successful after it is released, you can discuss with the film company to buy out the follow-up dividends in advance, directly Get a big payoff."

Only dividend rights, no copyright...

This is probably why Hollywood giants are keen on this investment model, and the risk of investment is borne by venture capital institutions. What capital earns is money, and what film companies earn is copyright.

With copyright, you can keep flowing.

But Jieyu Media does not make movies for making money, but for the brand.

Without copyright, there is no right to speak.

It doesn't make much sense.

Zhou Buqi asked: "Thomas, what about the cooperation model between Legendary Pictures and Warner? You don't have the film copyright?"

Thomas hesitated, then said, "Yes."

"Um?"

"If a capital institution cooperates with a Hollywood giant, of course all copyrights belong to the film company. Legendary Pictures is a film company, so it will also have some copyrights."

"Then why does the capital side not participate in the platter investment in the name of the film company?"

Thomas said: "If you make a platter investment in the name of a film company, the equity cannot exceed 50%. Equity is the copyright. The copyright must be in the hands of the six giants. They must have the right to speak in the film. But if the capital institution Nominal investment does not involve copyright, and the shareholding of capital institutions can exceed 50%. The more equity, the more profit. For example, the project launched by Universal this time stated that it would give up 75% of the equity. This cooperation model , the partner can only be a capital institution, not a film company.”

Zhou Buqi nodded, now he understood.

Looking at the material again, it becomes even more obvious.

In September 2005, the Swiss Boston Bank invested 370 million US dollars, first established a film company called Kingdom Pictures, and then invested in Disney's 32 films through the film company platter, accounting for 40% of the shares.

It means that they can get 40% of the film copyright.

There is no right to make decisions, but there are specific rights to participate and operate.

In January 2006, Relativity Capital established Hill Road Phase 1 Fund, investing US$400 million in Sony Pictures to participate in the production of 11 films, accounting for 40% of the shares. There is only the right to dividends, no copyright, and no specific participation.

It seems that when the subprime mortgage crisis hits next year, Jieyu Media should selectively choose the film shares under the platter mechanism.

Pick those items that are copyrighted.

If there is no copyright, there is no right to participate. How can we arrange our own people? How to use the influence of Hollywood movies to build the brand of Jieyu Media in China?

"Mr. Tour, can I take this material with me?"

"certainly!"

"Is there any more detailed material? Like... a list of movies that participated in these platter projects."

"no problem."

Thomas had a very nice attitude, very polite. He could feel that this Mr. Zhou was full of interest in movies and Hollywood, he was a potential investor!

We must build a good relationship and win over!