Are you ready to invest in the film industry?

Black Enterprise, Dec, 1996 by Matthew S. Scott

One way to get more black films made is to pay for their production. Here's how to size up an opportunity to invest when would-be filmmakers come calling.

Spike Lee is at it again. His current film project, Get on the Bus, the story of 15 black men who leave South Central Los Angeles on their way to the Million Man March in Washington, D.C., is threatening to become a lightning rod for "economic unrest" in Hollywood's paradise of profits.

Lee's decision to make his 10th film the same way he made his first - with private investors - raises questions about why he hasn't duplicated this approach more often, and whether or not the financing of this film could serve as a model for getting more black films on the screen. After his 1992 battle with Warner Brothers Studios to obtain additional financing to finish Malcolm X, and Ted Turner's more recent rejection of his funding proposal for a movie on the life of baseball legend Jackie Robinson, Lee's reason for advocating this approach is simple. "There are going to be projects that Hollywood just doesn't want to make," says the feisty owner of 40 Acres and a Mule Filmworks. "But just because they don't want to make them doesn't mean that those films shouldn't be made."

So who will make those films? Lee and producer Reuben Cannon, who was primarily responsible for raising the money and casting the film, hope the growing African American investment community will be up to the challenge. Get on the Bus was financed by 15 black men, including Lee and Cannon, for $2.4 million. While $2.4 million may be beyond your reach, many quality films can be made with considerably less (including Lee's first, She's Gotta Have It (1986), which had a $175,000 budget).

"It was always my intention to use the movie to inspire young brothers and sisters to take responsibility for making their own films," says Cannon. But he also says he'd like to see it used "as a template to attract other investors and build a real film fund to make films about our culture that Hollywood won't make." Already, the success of Get on the Bus has led the group to incorporate, forming 15 Black Men Productions, which hopes to finance two independent films each year.

Since Cannon's dream film fund doesn't yet exist, family, friends, individual investors, venture capitalists and private corporations are fledgling black filmmakers' best financing alternatives to the major studios. But before you consider depleting your personal or corporate resources to help bankroll "the next great American filmmaker," understand that film investing is a complicated process that requires sophisticated knowledge of investment vehicles, intimate knowledge of the film industry and audiences and the ability to assemble a team of people that have name recognition, proven talent, creative energy and the drive to finish a project.

"Investing in the film market is one of the most speculative investments you can make," warns attorney Nina Shaw, who prepared the private offering for Get on the Bus. "You could lose everything if the film is never made, or you could end up with a terrible product that you can't resell anywhere."

MORE FILMS FOR WHOM?

Since the 1990s, black films have experienced a Hollywood renaissance. More black films have made it to market, establishing that black-themed movies can garner solid returns in the commercial marketplace. Most of these films have been made with budgets between $3 million-$8 million which is low by Hollywood standards. These low-end budgets, combined with the fact that about one-third of the country's film dollars comes from African American moviegoers, increase the chances that black-themed films can break even or become financial successes.

One of the investors in Get on the Bus, Merrill Lunch Vice President Lem Daniels, agrees. "I just looked at the numbers," explains Daniels. "It was difficult to lose money on this movie based on its budget. Statistics on minority films with budgets in the $2 million range say they seem to consistently bring in returns of $6 million." He also considered possible merchandising, opportunities from the movie along with the revenues from the sate of home video right. "There were enough other opportunities to cushion the downside."

Even though Daniels was confident about his investment, be assured that there are no guarantees. Recent trends suggest that fewer black film releases are actually making money. Rutgers University Professor Jesse A. Rhines, author of Black Film/White Money, (Rutgers University Press; $17.95 paperback; $48 hardcover), say's although there are many factors contributing to the recent poor showings at the box office, he believes too many black directors are going for a big payday by attempting crossover films instead of making films for black audiences. "Black films are reaching out for the white crossover audience, and in the process they're alienating both black and while audiences." He cited The Great White Hype (1996), starring Samuel L. Jackson and Damon Wayans and directed by Reginald Hudlin, as such a film.