Filmed in Georgia
After the credit's role on your favorite film and tv shows you may have seen the famous Georgia peach indicating, "filmed in Georgia". From Stranger Things to Love & Hip Hop Atlanta, the growing film industry is estimated to add $4 billion each year to the state's economy.
As the film industry in Georgia grows, so do the businesses that are supporting its growth. Our team recently caught up with one of those businesses.
We met Jon Gosier of FilmHedge and asked him to share his experience building a debt finance company in the Peach State.
Thanks for talking with us, Jon! So, what is FilmHedge?
FilmHedge is a FinTech company that finances film and TV productions. In short, we write checks to filmmakers up to $20 million per production, but we do it in a way that's informed by data and facilitated by technology. So, it tends to be faster and easier than working with the alternatives, which would be institutional banks and private equity funds that usually finance film and TV.
The types of productions that we finance are between five and $50 million, so they tend to be sort of mid-tier to some A-list projects. And yeah, that's what we do. We've been around since February 2020.
How did you get inspired to start this company?
I spent most of my career building software companies and technology startups. And in 2016, I sold a company. I had also spent a number of years doing some government contracting and other startup successes. I took the money that I made from all of that work and decided I wanted to get into something else that I loved. I love technology, but my original love was film. I went to school to for film and TV when I was here in Georgia, at the Savannah College of Art and Design.
Back in 2018, I started investing in film projects as an individual. So, I was putting money into productions, and I got to learn how the film finance process works by being an investor in several films. One of my entertainment attorneys at the time suggested that I do debt instead of equity. When most people think of film finance, they think of equity - putting money into a film, where you own a little piece of that production, the movie comes out, it makes a gazillion dollars, hopefully, and then everybody gets their portion of that back based on what they owned of the film.
Well, that's great when it works that way, but sometimes what happens is everybody gets their little piece of a film that comes out and does nothing and in fact, loses money. A lot of people see film investing as risky, and it is. But on the lending side - the debt side, I learned that it was a very consistent and reliable way to finance deals in the film and TV space without taking the same risk as the equity investors. This way, you are lending against things that are guaranteed by much larger groups than just the film itself.
You mentioned film was a passion for you. Did that start when you were a kid?
When I was a kid, I actually wasn't in love with film, I was in love with comic books. I was an avid reader of comics. I still have thousands of comic books from back then. The thing about comics is you have a lot of narratives, different types of storytelling, different types of art, and different types of heroes and stories being told. And so, I fell in love with stories, and I fell in love with what's called sequential art.
When it came time to go to college, I wanted to study sequential art, because I wanted to draw comic books. When I got to college at SCAD, one of the things I learned is that sequential art is also the art of storyboarding for film and TV. I learned about film directing and cinematography because I started off doing the storyboarding. I developed just a love for film that. It was a different way of telling stories that... I'm old, so this was way before the current era where a lot of comic books crossed over to film and TV. Back when I was in school that never happened.
We had Batman. That's all I can really remember. Maybe Wonder Woman and Superman, and those were all super old by the time I was in school. But we didn't have The Avengers and all the great stuff that exists now. But that said, I still just fell in love with the idea of movie making and using what I knew as a storytelling device to tell stories in that medium. So, that's how I got into movies.
How does it feel to help people? Filmmakers are dreamers, and they're so excited, and then there's usually the financial part...
I never like telling filmmakers no when we have to turn them away from FilmHedge for financing. But when I do have to tell people no, my favorite part of running the company is being able to talk to them about what they can do to get us to say yes. What I find is that a lot of filmmakers just don't know what they don't know about the way money works in film and TV. So, 99% of the time, people really appreciate the knowledge and the fact that we're not just shutting the door in their face and telling them to go away. It's like, "Here's why." Because what we do is very simple when you look at it.
We are a lender, and we lend against receivables that come from other groups. So, it doesn't have to come from your production company, it's going to come from the group that wants to buy your film, or distribute your film, or stream your film. You've got that corporate agreement in place, and we can advance the filmmaker money based on that corporate agreement. And why would you not just take the money directly from those companies? If you do, they then own your production. It's better to get our money to make the production versus just getting the money from them. If they're giving you the deal and the money, then you have no leverage. So, we give filmmakers leverage, we give them capital, and we give them a lot of knowledge on how to get qualified for the type of lending that we do.
What's the response been like from the filmmakers you've worked with?
The response to FilmHedge has been great. To put it in numbers- we're all about numbers and data- we've been growing about 200% year-on-year. When we started in 2020, I'd see maybe one or two applicants per month. The following year, it grew to five or six, and now it's around eight to 10. These are all big productions. Big is relative, but they're all between that range of $5 to $50 million. They have A-list cast members. They usually have some of the production together. They've got their crew. They're headed into filming. They're on set. These aren't just scripts, these are projects that have come quite a bit of the way.
Tell us about your involvement with the Cannes Film Festival.
We're headed to the south of France for the 76th Annual Cannes Film Festival. We're really excited. This is our second year with FilmHedge as a sponsor of the festival itself and many events within the festival. We're excited about the Film Finance Forum. One of the reasons we sponsor the film festival is to educate the industry about how film finance works. I meet people who've been making movies for 50 years, they don't really understand how the money behind movies works. So, it's a lot of education, and a more informed film community means better potential customers for us.
Definitely. So, film in Georgia, has obviously taken off in the last few years.
I think it's really important that Georgia consider the ecosystem of film, not just the fact that we have productions coming here, and talent moving here. You have to think about the whole spectrum of what that means, why it's happening and how we keep it. The things that have made Georgia attractive enough to become the number one film production market in the world are the fact that it's a low cost of living state, we have our 30% tax incentive, and it's a right-to-work state, so it's easier to work with unions and non-union talent here than it is in other states. And Atlanta is a growing, vibrant, and diverse city.
So those are the things we have going for us. But there are other states with other cities that check a lot of those boxes, and all they have to do is figure out their own tax incentive, and all of a sudden, they're just as competitive. I believe that the film community has to nurture the ecosystem beyond just that. We have to build other infrastructure, like payroll companies and insurance companies for the film and TV space.
Right now, most of that infrastructure doesn't exist here, so even though the films are coming, the funding is still coming from LA, or New York, or London. The insurance companies are still all in California. The payroll companies are everywhere but here. And so, one company isn't going to do all of that, I don't think that's our role at FilmHedge, but we do represent the finance piece. There are other companies here that represent the equity finance piece. And as that ecosystem builds out, we need the film community and politicians to support it. Because really, the tax incentive, it's just that. It brings the business here. But to keep the business here, we need other stuff beyond what got them here. That's a big part of the role we feel we play at FilmHedge in that ecosystem, and we're excited to see all of it continue to grow.
To learn more about Jon and FilmHedge, visit them at https://filmhedge.com/
Georgia Power works to keep Georgia the top choice for filming and we are proud to be a part of this industry. Our crew is available to help you find unique filming locations including industrial sites, lakes, generation facilities, parks, and more. Click here to explore our Film Location Solutions.