Seeking Alpha
All posts from Seeking Alpha
Seeking Alpha in Seeking Alpha - Read, Decide, Invest.,

Even 'Star Wars' Should Use Crowdfunding

When a studio makes a movie, it needs to create a budget. There are options for financing that budget. The studio could finance it entirely from cash on hand, or maybe debt could be taken on. It could bring partners to the table, like Time Warner (NYSE: TWX) and Comcast's (NASDAQ:CMCSA) (NASDAQ:CMCSK) Universal has done at different times with Legendary Pictures. It can investigate various tax-subsidy arrangements that exist around the world.

Today, studios now have another arrow to pull from the financing-quiver: crowdfunding. It may be one of those awkward buzzwords created in the post-post-new digital entertainment economy world in which content makers find themselves, but it is nevertheless gaining traction as a practical mechanism for reducing risk. Sites like Kickstarter are ostensibly bringing power to the smaller players looking to turn an idea into a business model they can promote on Shark Tank, but they are increasingly being exploited as devices that can rake in some big cash for entertainment vehicles…and that's a fact that cannot go unnoticed by the bigger actors in the system. Read more