Tokenize This: Week 32 ~ Tokenized Film Production
Tap into your inner film junkie to explore a new investment realm.
The film industry is an interesting one in 2021. The days of movie theater releases are not quite over, but rather play a role in a hybrid ecosystem that gives way to streaming services like Netflix, HBO, Hulu, and Amazon Prime.
What’s interesting is that there may be ways for retail and accredited investors to capitalize on this hybrid role through security tokens. There are numerous crowdfunding platforms for the film industry, so the addition of security tokens would simply improve and ideally grow the users within the space.
Let’s take a look at tokenizing the film production industry and giving investors the chance to fund films and shows before they (maybe) get picked up by Netflix in Tokenize This Week 32 ~ Tokenized Film Production.
Value Adds
Film Producers (Token Issuers)
- Ease of providing dividends or earnings share to investors through the security token mechanism (improvement on typical crowdfund portals)
- May raise funds in multiple tranches from the community as needed, which may be crucial as films sometimes go beyond their timeline and initial budget
- Simplified issuance perks like viewing parties, meet-and-greets with the actors/actresses, early showings, and VIP “Red Carpet” treatment
- Could even offer future funding discounts for sequels, spin-offs, or other projects by the same production team
Enthusiasts & Investors (Tokenholders)
- Investment opportunity to gain exposure to a range of film types and production teams, with direct monetary incentives
- Long-term play for proven producers or up-and-comers if the investor wishes to fund multiple projects (see the discounted pricing value add from above)
- Unprecedented avenue to meeting the cast and crew, which previously would take some legwork, industry connections, or the purchase of meet-and-greet tickets that have NO monetary / investment return potential
Sundance. Nantucket Film Festival. SXSW. Big Sky Documentary Film Festival. DC Shorts. Cannes.
Imagine being able to show up to these prestigious (some more than others, but all pretty elite) film festivals knowing you actually funded one or multiple pictures being shown.
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Imagine the feeling of a thunderous clap surrounding the director and production team that you supported financially, knowing you may have a serious hit on your hands.
Yeah, much like the potential for backing Music Artists and YouTube Shows, there exists a niche market in the independent film world that may be just as ripe for disruption and opportunity.
As mentioned in the Value Adds above, investors in indie films or smaller sets have various points to consider that may entice investment.
- The prospect of funding and participating in the upside associated with a specific film
- The prospect of funding and participating in the upside associated with a specific director or production team
- The prospect of testing out one of the above and getting even more future favorable investment terms on sequels, spin-offs, or related projects
So, for someone with deep enough pockets (and the beauty behind the various security token fundraise types is that this is quite variable), they could commit to a full future ahead with one production team or one theme.
Like when Warner Bros. was ready to pay Vinny Chase $5 million for Aquaman, $7 million for Aquaman 2, and $12.5 million for Aquaman 3 before the Aquaman results were even finalized, security token investors could position themselves in similarly-proportioned ways that would scale their returns through sequels — whether through the agreement of higher distribution rates on future films or discounted investment pricing.
*Side Note: Imagine funding Entourage. For the amount I replay the series on HBO Max + the movie, I could really use some dividend distributions.
Are there any of these happening?
September 27, 2021. Then I’ll have an answer for you.
That’s when American Films common stock is set to begin trading on tZERO’s ATS.
For those who don’t know, tZERO operates an ATS — Alternative Trading System — which allows for the secondary trading of security tokens that are all tracked on Security Token Market.
Per BusinessWire,
American Films is an intellectual property anti-piracy innovator and developer of films and other creative projects. American Films will be the first over-the-counter traded company to move to trade on the tZERO ATS.
This isn’t quite the same as the concept we’ve been discussing — with dividends and perks dished out to token holders — but we love the momentum nonetheless and believe any successful projects at this stage in the ~$1 billion security token industry will be positive indications of more.
New Edition coming next Wednesday 9/15/21!
Disclaimer: This is not financial or investment advice and should not be interpreted as such. Please do your own research on investments and financial decisions before partaking in any ideas or ventures depicted in this publication.
