| With the nation on the brink of economic collapse, | | | | to minimize risk, maximize profits, and offer a |
| Wall Street panic at an all time high, and hedge funds | | | | steadier stream of revenues than what other |
| and financial institutions disintegrating, New York | | | | alternative investments may offer such as real |
| based Elliott Associates has parked an additional $1 | | | | estate, oil & gas, commodities, hedge funds, or |
| billion into Ryan Kavanaugh's Relativity Media which | | | | practically any other investment in today's market. |
| will finance a large slate of Universal Pictures' films | | | | Instead of dazzling investors with smoke and mirror |
| over the next few years. | | | | Monte Carlo simulation models that offer various |
| And the question remains "why?" in today's economic | | | | IRR's and scenarios based on unpredictable film |
| crisis as well as the recent pull out of billions of dollars | | | | revenues streams,the key is to offer an absolute |
| in institutional capital from the studios. | | | | return on investment utilizing international and U.S. |
| No matter how bad things are in the world, people | | | | public tax incentives that in certain instances can |
| need to be entertained. And while the crowd | | | | guarantee 100% or more of invested capital prior to |
| mentality of panic in the U.S. financial markets exists, | | | | revenues by leveraging equity positions with |
| overseas, properly structured commercial films | | | | non-recourse debt. |
| generate more revenues which add to bigger | | | | Investors who either want to take a 100% Federal |
| distributor buys with the Euro vs. USD. | | | | deduction under Section 181 or "The American Jobs |
| Apart from Elliott Associates, other investors including | | | | Creations Act" against their ordinary income, get an |
| billionaires,family offices from Wall Street to Silicon | | | | additional 20-40% in tradable and monetized state |
| Valley to the Middle East to Russia have been parking | | | | tax credits or cash rebates, have a hedge of |
| their money into Hollywood | | | | revenues from a slate of films, as well as stimulating |
| Larry Ellison Of Oracle, Paul Allen Of Microsoft, | | | | local and international economic development, and |
| Steven Rales, Fred Smith of Federal Express, Norman | | | | creating jobs, including for women and minorities. |
| Waitt, the Co-Founder of Gateway Computers, Jeff | | | | Sound too good to be true? |
| Skoll Of Ebay, Marc Turtletaub of The Money Store, | | | | Not too many other alternative investments can |
| Roger Marino Of EMC Corp, Sidney Kimmel Of Jones | | | | offer tax incentives, multiple exit strategies, the |
| Apparel Group, Minnesota Twins owner Bill Pohlad; | | | | potential to guarantee 100% of capital, giving back to |
| Real Estate Developers Tom Rosenberg and Bob | | | | the American economy and labor, while being |
| Yari, and, financiers Sheikh Waleed Al Ibrahim, Michel | | | | involved with the moviemaking process that would |
| Litvak, and Philip Anschutz are all behind the finance | | | | also add to the long line of recent film funds that |
| of a lot of films that range from box office hits to | | | | have been structured with numerous hedge funds, |
| Academy Award winners. | | | | private equity investors, corporate tax credit buyers, |
| While the glamour of the movie business may be | | | | and institutions. |
| appealing to most, at the end of the day, it is still an | | | | In today's shaky financial markets, not too many |
| unknown business that many try to gamble on, and | | | | businesses can be started that can have an almost |
| only a handful come out as winners. The real key is | | | | predictable ROI prior to operations and profits. |