Big returns for 'Speech,' 'Swan'
Call it the “Black Swan” ripple. Or “The King’s Speech” effect.After two years of doom and gloom in the independent sector, the box office and award-season success of those two independently financed dramas is giving renewed energy to producers and financiers working in the nonstudio trenches. “Over the last two years, it was near impossible to get movies financed,” said Mandalay Vision president Celine Rattray, a producer on “The Kids Are All Right.” “Now, for the first time ever, I’m getting calls from incoming investors, saying, ‘What’s next for us?'” The payoff from these successful films is already funneling directly into other indie projects. DRO Entertainment’s Peter J. Fruchtman said the positive outcome of his investment in “Black Swan” has expanded his and his investors’ interest primarily in senior debt and mezzanine finance and given them “the confidence that equity can make sense.” “Black Swan’s” backers, in particular, are seeing positive financial results. Cross Creek Pictures prexy Brian Oliver says an initial film fund aimed at $40 million has been sunsetted in favor of a $300 million fund. “Independent film got scary for a couple years, but now it’s coming back,” Oliver said. “I definitely think those two movies doing probably over $250 million worldwide helps invigorate people’s belief that financing independent films is a moneymaking proposition,” he added. While many producers say they’re still waiting for the “Indie Film Investment Deluge,” to borrow the title from a recent blog post by producer Ted Hope, there are positive signs. “I look at a number of high-end sophisticated commercial movies that have been put together recently,” said William Morris Endeavor’s Graham Taylor, “and I think that’s been helped by audience interest and demand, the credit markets coming back and the return of equity investors.” Ben Browning of Wayfare Entertainment, backers of “Sanctum,” said the successes of “Black Swan” and “The King’s Speech” could be more the exception than the rule, with both films clearly benefitting from movie star names and effective worldwide distribution. But while they haven’t “necessarily lowered the barriers to entry,” he continued, “they act as proof of concept that critical and financial success is still possible in a fluctuating marketplace.” Browning also cites, in particular, the films’ strong performance overseas as cause for confidence. “That will specifically help indie financiers mount similar projects because international distributors have enjoyed such success with them and are now looking for similar content and are willing to buy up front,” he said. And it’s not just “Black Swan” or “The King’s Speech” but a whole slew of recent indie successes that have bolstered the spirits of those working outside Hollywood. Taylor suggests it’s the very range of films that have achieved success that’s encouraging. “Beyond the obvious juggernauts, the reality is that ‘127 Hours,’ which was co-financed by indie money; ‘Blue Valentine’; ‘Winter’s Bone’; and ‘The Kids Are All Right’ were all financially successful,” he said. Producers are also upbeat because they see fewer studio films — particularly those aimed at a sophisticated audience — getting made, freeing up more top directors and talent for smartly budgeted indies. There is a growing consensus that “distinctive” films can sell in the wake of original hits from “Black Swan” all the way up to “Inception.” Taylor believes the atmosphere has been steadily improving over the last 18 months, but it’s only now beginning to catch on with public and industry opinion. For the first time in a while, as he said, “There’s a collective sense of optimism.”