The business of film
The business of film

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The business of film

3.2 Case study: Spooks – the financial package

Described image
Figure 3 from Spooks: The Greater Good, courtesy Shine Pictures

As you have seen, putting together the financial package for a film is a complex exercise involving multiple players. Now let’s take a look at the financial package for our case study, Spooks: The Greater Good.

Activity 2 Sources of finance

Timing: Allow about 5 minutes

Before hearing again from the film’s producer, Ollie Madden, take a few moments to think about the likely sources of finance for a film such as Spooks. (Consider how their situation may have been advantageous – if you remember, the film is based on a long running British TV show.)

Note your thoughts in the box below.

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Discussion

Ollie Madden describes the financial package that was put together for Spooks: The Greater Good. Watch the video and consider how the reality compares to your thoughts around the likely financial package, and any particular advantages this film project had.

Download this video clip.Video player: Video 8 Ollie talks about raising finance for Spooks
Skip transcript: Video 8 Ollie talks about raising finance for Spooks

Transcript: Video 8 Ollie talks about raising finance for Spooks

OLLIE MADDEN
Spooks was a very international TV show, and there were certain territories, such as Germany, Australia, Scandinavia, where the show was particularly popular, and those correlated with the territories where Altitude was able to do the strongest pre-sales. But we also had some surprising territories where the show had been popular, but not huge, such as Latin America, and a Latin American buyer bought the film at the American Film Market. Just really loved the screenplay, and loved the elements, and went for it.
 So it doesn't always- pre-sales at markets don't always pan out exactly as you expect to, sometimes there are some more personal, emotional response that a film buyer might have to a piece of material that belies the underlying popularity of the material. Once we'd successfully pre-sold Spooks at the American Film Market, we then had to look to all the other lines in our finance plan and pull those together. So we had our pre-sales, we knew we had the UK tax credit because it was a British film, it was going to be UK qualifying, about 20 percent, 25 percent.
 We started to talk to the BBC about a deal with them, it being a BBC show, it obviously made sense for them to be involved in the film, and we also started looking for a gap finance here who could fund the gap between our unsold territories against our pre-sale territories. And that's when we started talking to Pinewood Pictures. The next most important element, or equally important element, was the UK distribution deal, because it's a UK property first and foremost. Was Though it's a very international property, the UK is probably the biggest market and one of the advantages of Pinewood Pictures was that they also are a UK distributor.
 So as well as their gap finance, they could also give us an advance, a minimum guarantee, against the UK distribution rights to the film. We had a completion bond on Spooks provided by Film Finances. And they looked at our script, they looked at our director, they looked at our budget, and we had a number of meetings with them to make sure that they were comfortable we would be able to deliver the script on budget and on schedule. The other thing that Film Finances, our completion guarantor, assessed very carefully was our director, because we had a very ambitious and challenging schedule of seven weeks, and a lot of action to film.
 And one of things that they were very reassured by was the fact that Bharat Nalluri, our director, had worked a lot in television, where you have to move very fast, and you're shooting five or six pages a day. And he was able to run two cameras simultaneously, and had got very used to shooting very quickly. So that was very reassuring to our completion guarantor, Film Finances.
End transcript: Video 8 Ollie talks about raising finance for Spooks
Video 8 Ollie talks about raising finance for Spooks
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As Ollie mentions, the completion guarantor, Film Finances, was concerned by the ambitious production schedule that Ollie and his team provided.

Spooks: The Greater Good had three clear advantages when it came to raising finance for the film:

  1. The TV show was already popular in certain countries, which made it easy to pre-sell the rights to the film in those territories.
  2. As a British film, it automatically qualified for UK tax credit.
  3. Pinewood Pictures was able to fund the finance gap, and as distributor in the UK was able to pay a minimum guarantee against the UK distribution rights.
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