It's reasonable for me to be a three-time Golden Horse Award-winning director and an all-around

Chapter 107 Using other people's money to do his own thing, that's what a "conscientious" boss is (Seeking monthly votes)

"The horror film 'Insidious,' written by Lü Rui and directed by Hollywood's up-and-coming director James Wan, has officially ended its theatrical run, grossing $5639.7 million (approximately RMB 4.62 million) at the box office."

"The official North American box office rankings for horror films in 2004 have been released, with 'Insidious' ranking No. 3!"

"It is understood that 'Lurking' is a film series, and more sequels will be released in the future. Please look forward to it..."

There are quite a few media outlets in China that are following Lü Rui's activities.

Sure enough, as soon as "Lurking" finished its theatrical run in North America, related news was reposted back to China.

People in the film industry stared at the figure of "$5639.7 million" and remained stunned for a long time.

That's approximately 4.62 million RMB!
What an astronomical figure this is!
More importantly, this film only had a budget of $200 million, which translates to just over 1600 million RMB, yet it grossed 4.62 million RMB at the box office…

How much money do they have to make?
A group of people were calculating with their calculators, becoming more and more envious, their mouths practically watering.

In the end, everyone concluded: "We still have to go to Hollywood to earn US dollars; it's a place where everything looks bright!"

In their view, Hollywood today is equivalent to the California Gold Rush of the 19th century—you can make money just by going there.

Little did they know that even Wall Street capital had been swindled and cried out in despair, so how could this money be earned so easily?
While other companies are still unsure how to proceed, Huayi Brothers has already taken action and begun frequently contacting Hollywood.

With no progress on Lü Rui's side for the time being, they set their sights on Jackie Chan, Li Lianjie, and others...

"Isn't Chinese Kung Fu very popular abroad? We can talk to foreigners about this and see if we can make a Sino-foreign co-production?"

Wang Zhonglei confidently told his older brother, Wang Zhongjun, about the plan, and received the latter's strong support!
...

At the same time, Lionsgate.

To celebrate the box office success of "Lurking", Lionsgate held a grand celebration banquet.

Strictly speaking, this was Lu Rui's first time attending such a formal celebration party in Hollywood.

When Mystic River won an Oscar, he attended Warner Bros.' dinner party, but he wasn't the star of the night.

But tonight is different, because he is the undisputed core of the event!

"Lv, I wish our cooperation a complete success."

Sarah Greenberg approached, holding a glass of champagne, and clinked glasses with him with a radiant smile.

Having discovered two blockbuster horror films, "Saw" and "Insidious," this female vice president's status within Lionsgate has been steadily rising.

Lu Rui clinked glasses with her and replied with a smile, "Madam, I also look forward to our future cooperation proceeding smoothly."

Sarah understood that he was referring to the plans to release a sequel to the Insidious film series and the collaboration on I Am Legend, and her smile became even brighter.

Although Lionsgate has been developing for many years and has accumulated a lot of experience, who would complain about making too much money?

Moreover, their goal has always been to catch up with the Big Six Hollywood studios.

To complete this plan, more film projects will be needed to support it.

The shows "Lurking" and "I Am Legend" that Lü Rui presented also provided them with a strong boost, albeit indirectly.

After exchanging a few pleasantries, Sarah turned and went elsewhere.

As Lü Rui watched her departing figure, a peculiar light flashed in his eyes.

Lionsgate wanted to use him, but wasn't he doing the same thing?
As an independent production company, Ruixing Pictures is not much stronger than Ant Group in Hollywood.

To achieve steady development, it is essential to build a wide network of allies.

Lionsgate, Warner Bros., Sony Columbia, and 20th Century Fox, which bought the distribution rights to "Hitch"... these are all in his "allies" plan.

The instructor once said that in order to develop rapidly, one must make as many friends as possible and as few enemies as possible.

Of course, if someone is so blind as to provoke us, then I'm sorry.

"My sword is not bad at all!"

...

The dinner is over.

The next morning, just after "Lurking" was taken off the big screen, Lionsgate finalized several offline distribution rules.

Regarding licensing fees, relying on its own videotape and DVD distribution channels, Lionsgate secured the North American home theater rights in accordance with industry regulations: a base transfer fee of $500 million, plus a 20% commission on rental sales.

In addition, the ten-year broadcasting rights for public television stations are worth $500 million, the ten-year broadcasting rights for cable television stations are worth $300 million, and the five-year broadcasting rights for the internet are worth $150 million.

As for merchandise, another major source of revenue for Hollywood commercial films, merchandise licensing only sold for $200 million because horror films have always been weak and unreliable.

After all the authorization terms were signed, Lü Rui approached Lionsgate the next day to discuss the payment of revenue sharing fees.

He used an excuse that Lionsgate could not find to delay payment for: "Only after the funds for 'Infiltrator' are recovered can I start the preparation work for 'I Am Legend' as soon as possible, otherwise it will not be able to proceed smoothly."

The Hollywood market has always been straightforward; it doesn't care about anything else but money, power, and sex.

A successful and profitable producer or director often receives more support and trust for their next project.

The reason is simple: only successful people are more likely to continue to succeed!
Sarah was clearly more eager to move forward with "I Am Legend" than "Insidious," especially since Lionsgate had a stake in it.

Without hesitation, she immediately called the finance department.

“Lv, although the theater chain hasn’t transferred the payment to our account yet, for the sake of our friendship and future cooperation, we can advance the payment…”

She rambled on and on, but all she wanted was for Lü Ruicheng to do her a favor.

Since talking was effortless, Lü Rui simply played along, feigning emotion and promising to stand firmly with Lionsgate from the start...

The next step is the financial accounting process.

"Insidious" ran for more than five weeks and grossed $5639.7 million in North America.

Compared to the production cost of $200 million, it was undoubtedly a huge profit!

According to standard practice, after deducting theater revenue share and various taxes, Lionsgate's final share of the box office revenue was $2679 million.

According to the distribution agreement, Lionsgate will take 28% of the total North American box office revenue (including marketing and distribution costs), which is $1579 million.

The distribution fee for home theater rights, new media rights, and television rights is 20%, or $290 million.

The company takes a 30% cut of the derivatives, which amounts to $60.

As a result, Lionsgate earned $1929 million from "Insidious" with a total investment of no more than $500 million.

This profit is simply outrageous!
Even including marketing and distribution costs, low-budget horror films that become box office hits often generate astonishing profits.

On the other hand, Ruixing Pictures, the production company, can earn $2400 million.

After deducting the $200 million investment cost and $150 million in self-organized promotion expenses, the net profit was $2185 million.

Therefore, we can conclude that distribution is much easier to make money than production!
Although time, energy, and money are required in the early stages, the effort and risks involved are far less than those of a producer. How can this not make people envious?
This further solidified Lü Rui's determination to emulate Lionsgate and establish his own distribution company in the future!

In fact, Peter Griffin had already contacted quite a few small publishing companies during this period, and three of them were quite suitable.

However, after careful investigation and analysis, Lü Rui discovered that these publishing companies were either too small in scale or had inadequate distribution channels.

It would be more appropriate to start a new publishing company rather than acquire them.

So this matter was temporarily put aside, and we'll deal with it again when we find a suitable one later.

...

After calculating the box office revenue share in North America, the next step is to calculate the revenue share from overseas distribution rights.

As previously agreed, Lionsgate intended to act as the agent and collect a 32% agency fee.

However, given that their overseas distribution channels are not yet fully developed and the repayment cycle is too long, Lü Rui wanted to buy them out directly.

Coincidentally, Lionsgate also had the idea of ​​buying out the film and operating it independently, so the two parties were in sync.

According to industry practice and considering the North American box office performance of "Lurking", Lü Rui finally quoted a price: "3500 million US dollars".

In recent years, films that have performed well at the North American box office have generally achieved higher box office results overseas than in North America.

The growing international market for Hollywood films is a consensus among everyone in and outside the industry.

While horror films are relatively weak, it's not difficult for "Lurking" to gross over $50 million overseas. In Lü Rui's memory, the film's global box office in his previous life had just exceeded $100 million, so the asking price of $3500 was quite reasonable and not an exorbitant demand.

Sarah frowned upon hearing this: "$3500? Lv, it's hard for us to make a profit at that price."

Lu Rui didn't have time to argue with her and said directly, "I believe you have also done the internal calculations. It's definitely not a problem for the overseas box office to exceed 5000 million US dollars. It just requires a little more effort."

Moreover, this is a good opportunity for Lionsgate to expand its overseas distribution channels. We need to look at things in the long term. There's more than one installment of "Lurking," and there are many sequels. We've also reached distribution agreements, haven't we? Little by little, it adds up..."

He used his silver tongue to exaggerate the project's advantages again and again.

Although some of it was embellished, it was all true.

The two sides talked for two hours, during which Sarah went out several times to calculate and discuss with other staff members in the department, and finally anchored the price at the round number of $3000 million.

At this point, Ruixing Pictures' total revenue from the film "Lurking" reached $5185 million.

Of course, taxes and fees need to be deducted, and management fees (protection fees) for various associations also need to be paid, totaling no more than $600 million.

In other words, at least $4500 million will be coming into Ruixing Pictures' coffers!
This is the final step; no one else can get a share of the profits.

Horror films are different from big-budget productions; the director and actors receive fixed salaries, and no one gets a share of the profits.

After settling the accounts and confirming the payment time, Lü Rui immediately took out the "I Am Legend" project proposal that he had prepared in advance.

"Lurking" has come to a temporary end; it's time to start a new project.

Sarah took the project proposal, immediately went out of the office to call a meeting with the team, and only signed it after confirming that everything was correct.

"30%, or $4500 million, will be transferred to the designated account before noon tomorrow."

"Ok."

With a bright smile, Lü Rui stood up and shook hands with her, reiterating his willingness to "advance and retreat together".

Upon returning to the company, he immediately summoned Peter Griffin and asked him to arrange for the finance department to prepare the accounts.

"First, allocate $1500 million from the 'I Am Legend' project account and quickly acquire the rights to the novel I previously asked you to keep an eye on."

Can a company that doesn't cheat investors be considered a good company?

There's no rush to formally prepare for the project, since the funds from Sony, Columbia Pictures, China Film Group, and Shanghai Film Group haven't arrived yet.

Negotiations with Warner have not yet begun.

However, a portion of this money can be spent first, and the project preparation progress can be reported to Lionsgate periodically.

As a director and film company owner with a "conscience," Lü Rui believes he still has a strong moral bottom line.

He simply enjoys spending other people's money and resources to make money for himself, transferring risks to others, but he never cheats anyone and tries his best to ensure that investors' interests are not harmed.

Everyone can make money, so future cooperation will naturally go smoothly, and a long-term alliance can be maintained.

Those who have worked with him are aware of this.

"Lv, are you sure you want to buy the rights to that novel?" Peter Griffin asked curiously, frowning.

Two days ago, he compiled another list of unsold novel copyrights from the New York Times bestseller list.

He thought that Lü Rui still hadn't found anything he liked this time, but to his surprise, a novel called "Twilight" was actually picked out.

He didn't pay much attention at first, thinking that the novel might have something unique about it.

But when he bought the original novel and read through the contents, his teeth almost ached from the sourness!
The reason is simple: the novel's plot was just too melodramatic, and no matter how you looked at it, it didn't seem like it could be adapted into a blockbuster movie.

Lu Rui looked up at him and asked curiously, "You don't like this novel?"

“No!” Peter shook his head vigorously. “I like Harry Potter, but I don’t like Twilight.”

The plot of this novel is too exaggerated. Only my underage niece would like this kind of vampire teen novel. Any adult would have absolutely no interest in it.

Lu Rui listened to his words and was pleased rather than worried.

The Chinese title of the book is "Twilight". It is a youth-oriented book and is extremely popular among junior and senior high school students.

Although its plot is incredibly melodramatic to adults!

But in the eyes of teenage girls, it's even better than the Bible!

In its previous life, it also had another name: [The American version of Tiny Times]

Putting aside whether it's melodramatic or not, this novel is definitely in the top ten in the North American market when it comes to making money!
Although Lü Rui didn't like this type of book either, he liked money!
Who can have trouble with money?
Of course, if you were to explain to Peter that the novel could make money, he certainly wouldn't understand.

So, Lü Rui waved his hand and said, "Go talk to Ms. Mel first and try to get the copyright as soon as possible, so that it doesn't fall into the hands of other companies."

Also, remember to keep the accounts neat and tidy, so Lionsgate doesn't find out we've used their money for other things.

“Okay.” Peter perked up immediately at the mention of this and assured him, “The finance team was hired at a high price and is the best at bookkeeping.”

"Okay, go get busy."

Lu Rui waved his hand to send him away and began to arrange the next steps.

He will not invest the money he earned from the movie "Lurking" into the company's operations, but rather plan to use it to invest in other industries.

For example, some stocks, emerging industries, etc., use money to make money.

As for the company's basic operating expenses, they can all be accounted for under the "I Am Legend" project.

The massive investment of $1.5 million has many loopholes and loopholes that can be exploited.

He even planned to source the funding for "Taken" from here.

This $1.5 million must be spent entirely; it cannot remain in our hands, otherwise it will definitely cause trouble.

Of course, on this basis, we also need to give the investors an explanation. At the very least, the movie must be a box office hit and sell like hotcakes. We absolutely cannot lose money.

Profits can be small, but losses are absolutely unacceptable. This is the bottom line for cooperation, and it's also a rule that Lü Rui has set for himself.

He wouldn't follow Warner Bros.' example and turn a high-grossing film like "Harry Potter" into a negative net profit.

The future is long, and if we really do this, where will we find a partner to hold us accountable?
Compared to those fraudulent companies, Lü Rui portrays himself as a "great person" who is well-versed in the Eight Honors and Eight Shames and is fair, honest, and selfless!
The following morning, he took the "I Am Legend" project proposal to Warner Bros. and successfully secured the final 10% investment.

At this point, the investor structure is officially finalized:

瑞兴影业30%、狮门30%、索尼哥伦比亚10%、华纳兄弟10%、中影10%、上影10%。

The total revenue was $1.05 million, with Ruixing Pictures contributing nothing and holding a 30% stake.

Then, Lu Rui planned to use $6-7000 million of it to make the movie.

As for the remaining $3000 million, consider it as "normal filming losses".

In addition, making this film also requires some assistance from the U.S. military...

Warner Bros. said they could help, but on the condition that they would have exclusive distribution rights to "I Am Legend".

Lu Rui naturally had no objections, since Ruixing Pictures currently lacks distribution capabilities, so it didn't matter who they partnered with.

However, Lionsgate and Sony Columbia have many opinions.

His chosen approach was to have the three companies sit down and negotiate, and then award the issuance rights to whoever offered the most favorable terms.

That would be ideal if the three companies could cooperate and work together!

This is not without precedent. For example, "Master and Commander: The Far Side of the World," which was released at the beginning of last year, was jointly distributed by Fox, Miramax, and Universal Pictures.

Anything is possible as long as the terms are agreed upon.

Of course, this is not something that can be resolved in just a few days, as there are too many regulations and copyright disputes involved.

Lu Rui wasn't in a hurry; he let them take their time, since there was still plenty of time.

In the following days, he first finalized a contract with Sony Columbia for "The Pursuit of Happyness (US version)".

Immediately afterwards, he sent the already translated script of "Taken" back to China to arrange for it to be approved.

Finally, there's the copyright issue for "Twilight." The original author, Stephanie Meyer, insisted on meeting him, but it's unclear what his true intentions were.
(End of this chapter)