BRON layoffs explain the future of film financing

Exclusive: BRON is restructuring, laying off employees and thinking smaller when it comes to film production. This may be good news for the cinema.

The movie industry teaches you to be wary of big spenders. Broad Green moved back and forth in a blur of miscalculated flops. Annapurna downsized after several rash purchases and eventually stopped acquiring films. It is now rumored that Canadian investment studio BRON – which has helped finance films like “Joker” and “Licorice Pizza” – is following a similar path.

Sources tell me that the studio launched by husband-and-wife team Aaron and Brenda Gilbert in 2010 has laid off several executive positions and will merge its film and television divisions into a single unit. Rather than producing the feature films live, I’m told BRON is now working to find new business partners as it restructures its business model around its BRON Digital division (in its previous incarnation, BRON’s funding came from partly Canadian pension plans) . This means a renewed interest in animation and games designed to create new franchises, and not the usual mix of blockbusters and high-profile authors that it has backed in the past. The company declined to comment.

BRON may seem like another company feeling the strain of the pandemic, but in recent years it has become one of the most prolific film financing entities in North America, especially for films made in the $50 million range. The company’s chart also includes everything from “Judas and the Black Messiah” to Clint Eastwood’s “The Mule,” “Ghostbusters: Afterlife” and “House of Gucci.” This list signals not so much a collective view as an array of them, which isn’t the worst strategy in an era defined by fickle viewers. In a different world, BRON’s profile might have inspired him to market sweatshirts to compete with the A24 fashion set.

“Joker,” co-financed with Warner Bros., grossed $1 billion worldwide and made it clear that big theatrical films with innovative concepts had serious commercial potential. Studios could mitigate their risk factor; BRON could leverage this risk for a serious upside. With the pandemic, this model made less sense. “House of Gucci” was a big flop. “Ghostbusters” grossed $200 million worldwide, but fell far short of the $650 million expected by investors.

Green-lit films before the pandemic were no longer sufficiently theatrical in the post-Covid market. Several of the titles financed by BRON for Sony have been sold to streamers, including Tom Hanks’ WWII thriller “Greyhound” (Apple), Kevin Hart’s comedy “Fatherhood” (Netflix) and the life-saving drama of Ron Howard’s Thai cave “13 Lives” (Amazon). This series of setbacks underscores the bottom line: a funding entity dedicated to movies and movies only makes no sense.

BRON’s new direction includes Web3 apps, with blockchain games and NFT components being discussed, but BRON Digital isn’t new; it has a core staff of 65 employees and twice as many working for the division in some capacity around the world. It’s no surprise that the company is now looking to its other strengths. Consider the precedent: Annapurna has recently made headlines for projects outside of its interactive division, like the third-person cat adventure game “Stray” (which, damn it, this cat lover really needs to play) and his investment in the Tony-winning. musical “A strange loop”.

BRON hasn’t completely given up on feature films. While the company will double down on IP commitments like its “Fables” and “Gossamer” animated series, I’m told it may continue to invest in films with budgets under $10 million – a sum paltry by Hollywood standards, but also the sweet spot for ambitious lo-fi narratives where some of the best movies are made.

“Moonlight”

A24

Only six years ago, “Moonlight” won Oscar and commercial success on a $1.5 million budget, but few have replicated that approach. After “Moonlight” premiered at Telluride, I wrote that movies don’t die; they just get smaller. It was mostly an aesthetic observation, but the company is starting to realize that too. It’s not the worst fate for a medium that often leads to reckless spending and a culture steeped in power plays that do the creative process a disservice.

So: Let’s say the future of movie financing is small movies – not Dogma-95 small, but $10 million. This means that the occasional “larger” budget from a funding entity would be closer to $25 million rather than $50 million (which movies like “Joker” have cost). It’s not a bad place to be – it’s the advertised budget of “Everything, Everywhere, All at Once”. Funding at this level makes sense for true visionaries who can also get some measure of studio support. It’s worth repeating a point I’ve made many times in this column: studios need more first-look deals with filmmakers, where they can allow emerging creatives without setting the money on fire.

Cinema will continue to sneak into the system even if it doesn’t make sense on paper. Once in a while, a visionary madman like Werner Herzog or Frances Ford Coppola will come up with “Fitzcarraldo” or “Apocalypse Now”, drive everyone crazy and deliver a masterpiece. You can’t scale a business around these projects; they will always have to storm the doors. It’s time to welcome an era of low-budget cinema in tandem with the chaos that will always exist on the fringes.

My optimistic reading of this situation may not be one that many industry insiders agree with. Tell me why I should be more alarmed by the BRON news and what it portends for the state of feature filmmaking, or suggest your own solutions to current funding difficulties, and I may include them in next column: eric@indiewire.com

Previous columns by Eric Kohn can be found here.

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