Chinese Web Company Baidu Launches Kickstarter-style Film Service
Web search giant Baidu launched a Kickstarter-style project were average investors can help fund major movie ventures. The funding site, Baifa Youxi, is a joint launch between Baidu, Taiwan's Central Picture Corporation, Citic Bank and DeHeng law firm in Hong Kong.
Users can put up as little as $1.63 of their own money and receive yields based on how the later films perform at the box-office.
Alibaba, China's largest e-commerce business that had an enormous IPO in New York earlier in September, launched a crowdfunding vehicle Yulebao, translating to "Entertainment Treasure," last April.
The premise is almost identical to that of Kickstarter, GoFundMe and the newest Baifa Youxi in that it allows average citizens to become movie micro-financiers. Chinese investors are combining a needed outlet for ordinary Chinese citizens to leverage their earnings despite a tightly-controlled stock market and expensive real estate climate and the country's general love for movies.
Baidu estimates that returns on client's investments could be as high as 16 percent.
"The launch of Baifa Youxi will bring fresh wind to our film industry," La Peikang, CEO of state-run film agency China Film, said. "It creates the platform and an opportunity for creative marketing and film prosperity. It enriches the way users can participate in and enjoy films and narrows the distance to the consumer."
"Golden Age," the first movie project listed for investors to join, has been categorized as a Chinese version of the classic "Gone With the Wind," and is set to star Tang Wei and Feng Shaofeng. The film quickly drew more than 3,300 followers, who raised $29.3 million, 120 percent of the movie's needed budget.
"Combining with Baidu allows production firms and celebrities to understand the consumer better and thereby better meet their needs," La Peikang added. "It is a good start to build a dream factory for different elites, investors and users."
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