Jack gao says he is looking for “game-changing” companies he can back through his own Gao Entertainment investment vehicle.
To give an idea of what he means, Gao points to his company’s stake in WeChat Movies, a ticket sales and data collection app that sits on top of Tencent’s wildly successful WeChat messaging platform. Less than a year into operation, WeChat Movies has just completed another funding round, raising over $100 million.
Gao has 20 years of experience in IT, Internet and media/entertainment in China. He was regional CEO of News Corp. and Microsoft, a board director of Phoenix TV and initiator of New Corp.’s investment in Bona Film Group.
He says the Chinese film biz lacks sophistication. “It used to be very government-driven, then was influenced by random wealthy business interests, but now there are more professional investors getting involved. Like the stock market in China, it will be established quickly and keep on improving.
“More Chinese companies are appreciating the means (of modern film finance such as completion bonds and gap finance) and have started partnering with the players from Hollywood such as Film Finances to introduce and ‘countrify’ these practices in China.”
Gao’s optimistic that Internet giants Baidu Alibaba Tencent and Wanda are not going to completely take over the Chinese industry. “They will play bigger roles in China. But there will be many more new studios or independent filmmakers to be created and financed by other professional investors.”
However he worries of bottlenecks if Chinese companies don’t expand. “They must connect with both Hollywood and newer technologies in order to scale up. At the same time, while Hollywood is enjoying the revenue and investment growth from China, the players should seek out in-depth partnerships in co-productions, promotion and distribution, talent education and management, and finance services in China. Truly hybrid, mixed-blood Hollywood-China companies will emerge and succeed.
“We have committed funding to WeChat Film in Beijing and Orb Media Group in Los Angeles among others. There will be tens of billions of dollar-sized entertainment companies established in China in the next five or 10 years, and hopefully I could help some of them in bridging the gaps between China and Hollywood, and between entertainment and technology.”