The Scoop Behind the Silver Screen
A bit of Hollywood came to HBS recently when Steven Samuels spoke at the invitation of the School’s Entertainment and Media Club. A former real estate developer, Samuels is an independent movie producer with a solid body of work under his belt, including the George Clooney legal thriller Michael Clayton up this weekend for seven Academy Awards. (Any predictions out there on the winners?)
Samuels drew an analogy between the real estate industry and filmmaking. “I look at a movie script the same way I look at an empty piece of land,” he said. “It’s only 120 pages of writing until other critical elements are added.” Both businesses require vision and a healthy appetite for risk. Another similarity is permits, budgets, and a cast of people who come together to work on a common project for two or three years. Attracting a cornerstone client like Target can make a difference to the success of a shopping mall, just as the addition of a talented director or actor can change the fortunes of a movie.
There is one key difference, however. “In real estate, you’ll know about what your project is worth, in the end. Not so with films. You have no idea whether you have a hit or a loss on your hands.”
This being HBS, Stevens detailed some of the financial aspects of producing an independent film, i.e. one that is made without the deep pockets of a large Hollywood studio. According to Samuels, about eighty percent of funding comes from the pre-sale of foreign rights — and these “takes” can be estimated in advance by companies who specialize in this sort of analysis. Bonds can be purchased to cover cost overrun risks, too. And it doesn’t hurt to have the reality check of a bonding agent looking over the movie’s projected schedule and budget. For actors, directors, and producers alike, the additional risk and legwork involved in making an independent film can pay off in creative control over the final product—even after a studio accepts a film for marketing and distribution, executives can’t demand that the ending a film be changed at a focus group’s whim.
One audience member wondered how Samuels had managed to make the transition between two such different industries. “You have to build a pattern of trust,” he said. “When you create a record of films, artists see that you’ll take a risk on their creative vision. But I do make them responsible financially.”
What about digital media and a not-so-distant future when content is streamed instead of being packaged on a DVD? “We’re climbing a mountain,” Samuels responded. “Nobody knows what’s on the other side. Nobody knows how to monetize it yet,” he said, referring to the recent Writer’s Guild strike over compensation for the use of content on the Web.
The audience included a mixture of students and staff. Ryan Heller, a guitarist for the rock band Aberdeen City, learned about Samuels’ visit from his partner, Mikaela Boyd (HBS ’08). “Any movie that gets made today is bound to have a good story,” he said. “Michael Clayton was one of last year’s best films.” Mohit Bathija (HBS ’09) said he’s visited his cousin (a fashion designer) on the set of a Bollywood movie and hopes to do something in the entertainment and media space after graduation. “I try to take advantage of as many cool events as possible. Unfortunately,” he added ruefully, “it sometimes comes at the expense of cases.”
