After a record-growth year fueled by pandemic-induced lockdowns, São Paulo-based VOD data and content aggregator Sofa Digital will be launching a Latin American film investment fund, Sofa Capital, on Nov. 9.
As the number of streaming platforms proliferate and demand for online content continues to mount across the region, Sofa Digital plans to set up a fund that will enable it to produce 100 Latin American titles a year by 2024. It has also been supporting film distributors in Latin America by co-acquiring films with high theatrical and premium VOD potential.
“Latin America lacks a supply-chain financing infrastructure that enables local filmmakers to produce a steady stream of films, many of whom have been dependent on government subsidies and foreign grants,” said Sofa Digital Founder and CEO Fabio Lima.
With many of these state-backed subsidies being cut back by populist governments, especially in Brazil and to some extent, Mexico, the need for such a fund could not be more acute.
In a trial run, Sofa Digital has already financed the production of eight Brazilian films, four of which were already released, and the others set to launch next year. Among them is “Barraco de Familia” (“A Family Frenzy”) (pictured) from Santa Rita Filmes, which features the first Brazilian film with an all-black lead cast, an astonishing detail given that more than 50% of Brazil’s population identify themselves as black or mixed race.
“Sofa Capital will be financed via future receivables from distributors and producers,” explained Lima, adding: “As Sofa Digital is one of the stakeholders involved who collects from platforms, aggregates content and audiences, our risk is radically asymmetric to that of regular financiers.”
The company strategy relies on an audience aggregation tool, Filmelier.com, a free online service that provides consumers with information on where they can find films online as well as news and reviews on them. It also categorizes films by their genres and even provides tutorials on how to access platforms. According to Sofa Digital, “Filmelier grew over 700% during the pandemic and currently attracts over three million unique users per month.”
On the distribution front, Sofa Digital has acquired over 100 films; 82 were already released by its Synapse Distribution label, the brand inherited after it merged with Synapse in 2019.
“Through data collected on user interests and film performance on VOD platforms, Sofa Digital can identify an array of different audience clusters, make better acquisitions and design smarter marketing campaigns for the companies’ releases,” the company stated.
According to João Worcman, chief content officer at Sofa Digital, “Having a clear audience design is crucial for highly successful releases on TVOD, which increases the value of a film for all other windows.”
“We already licensed 45% of all titles that we released on TVOD for an SVOD or Pay TV player. In the past 13 weeks, seven of our acquired titles broke through Netflix’ Top 10 titles in Latin America,” Worcman said, noting, “interestingly, only two of these were produced by U.S. producers, the other five were from Brazil, the Netherlands, Lithuania and Australia.”