Saudi Arabia in September launched a $100 million film fund aimed at attracting investments from global film studios to help fuel the kingdom’s rapidly growing local film industry.
The Saudi Film Fund – as the fund is known – sees Saudi’s Cultural Development Fund making a 40% investment in collaboration with investment bank MEFIC Capital and specialized holding company Roaa Media Ventures, which is its technical partner.
The fund is being announced just as the Saudi Film Commission launches the second edition of the Saudi Film Confex confab in Ryadh where roughly 130 local, regional and international industry execs specialized in production, exhibition and studio construction, will be gathering Oct. 9-12.
Ahead of Saudi Film Confex, Variety spoke with RMA Ventures chairman Redha Alhaidar, who noted that since the kingdom lifted its religion-related ban on cinemas in 2018 and started setting the wheels of Saudi Arabia’s film industry in motion “the quality of the [local] projects today is much better,” adding that he thinks “this will continue to develop because we see a lot of talent coming into the pipeline after realizing that the ecosystem is open and enabling.”
Alhaidar, who is also a former president of the General Commission of Audiovisual Media (GCAM) – which is the Saudi’s media industry’s regulatory body – took questions from Variety about the specifics of the new first-of-its-kind Saudi Film Fund.
One key aspect of the fund is that it’s geared toward two types of investments: media-related infrastructure and production, if I’m not mistaken. Can you talk me through the basics?
Correct. We are going to be doing two types of investments. And when we say media infrastructure, we mean distribution, logistical services, all these types of equity investments, obviously in companies. Then we have the production component. The production aspect is not specifically international. It’s international and local. We are hoping that we will have enough flow of regional and region-related projects, which will be our emphasis. But we are also open to international projects where we see commercial return on investments.
Can you tell me more about the Saudi infrastructure aspect?
So, I mean, infrastructure is a very generic word, and when we talk about that, we’re talking about the supply chain of the media industry. Anything that leads to proper production value. And this component in particular is more pertinent to the Saudi ecosystem. So it could be investing in Saudi companies that provide logistical services. It could be companies that do post-production. It could be investment into companies that do equipment depending on how appealing the opportunity is. But it also could include creating joint ventures with international companies to be set up in Saudi. As long as it contributes to the development of the ecosystem, this is obviously something that we’re very keen on.
And what are you looking to invest in on the production side?
The number one criteria for us is commercial viability. Is this going to bring a return or not?
We are looking at four types of projects: films, series, documentaries and animation. So anything that falls within that type of content. Obviously we are looking at the local and regional opportunities in terms of film, as long as they meet our criteria. But also we realize that the [current] pipeline may not be enough and the potential upside of those projects could still be in its early stages. So we will also look at other international opportunities where there is a bigger sense of commercial appeal.
Just to be clear, are these production investments only for productions shot in Saudi, or is there room for investments on productions shot elsewhere?
The priority is for projects to be produced in Saudi, but if there are opportunities that we see as being of strategic value, or something that is very appealing commercially, we will look into that as well. So we are not limited to projects that are shot in Saudi.
Is there a cap on investment for each project?
Yes. At the end of the day we are a $100 million fund. This is a good chunk of money, but it’s not infinite. So we have to be very cautious about how much money we put into projects. Typically, it’s not going to be the bigger portion of a project and we are probably going to shy away from really big projects unless it’s a very minimal contribution. So there is no specific cap per se, but we take into account the size of the fund, the size of the investment, and the risk profile of what we’re trying to do. If we feel that this is a safe investment, we might upsize our criteria, but typically, it would be between 10 to 20%, but not more than that.
What type of return on investment are you looking to make?
Typically, it’s a 20% target that we are looking at. It’s probably a standard sort of return in that sense.
I know you just launched in September, but can you tell me about how the response from Hollywood has been?
I mean, it’s quite big. We’ve been receiving proposals from Hollywood-based production companies, and I think some of them are very interesting projects. So we’re in the process of evaluating and looking at these projects.
Source Agencies
