How Defiant Studios Banks on a Financing Model With Microbudgets and Emerging Talent

Fox’s ‘America’s Most Wanted’ Revival Caught Some Fugitives, but Did It Nab Viewers?

Maurice Fadida (left) and Eric B. Fleischman of Defiant Studios/Ben Abarbanel

How Defiant Studios Banks on a Financing Model With Microbudgets and Emerging Talent

Producers Eric B. Fleischman and Maurice Fadida are finding success and earning trust with a plan modeled off the folded Paramount division Insurge

Within the DNA for Defiant Studios, the production banner behind Terry Crews’ 2020 hit “John Henry” and last month’s “Phobias,” are two companies: You’ve definitely heard of the scrappy, microbudget mentality that has made Blumhouse Productions a juggernaut. But you may have forgotten about Insurge, a one-time division of Paramount born with the mission to incubate young, first-time filmmakers.

Defiant Studios producer Eric B. Fleischman is a veteran of both companies, and he and partner Maurice Fadida have quietly found success by embracing a model that is built around small-budget genre films from emerging talent and slate financing that mitigates risk and allows for taking more chances on talent.

Continue reading

Join WrapPRO for Exclusive Content,
Full Video Access, Premium Events, and More!

That approach is already paying off since Defiant was the only studio with two movies that premiered at last month’s SXSW: Elle Callahan’s “Witch Hunt” and Mickey Keating’s “Offseason,” which sold to RLJE Films and Shudder just this week.

In 2010, Fleischman was a student just out of USC who had landed an internship at Paramount and begged to be placed into the studio’s newly launched division Insurge. The studio was hot off the success of “Paranormal Activity” and had crafted Insurge as a microbudget group designed to foster emerging talent.

“Finally, a studio is going to bridge the gap between old Hollywood and young Hollywood. We’re going to lower the gates; we’re going to let 10 of you a year come in, make $100,000 movies,” Fleischman told TheWrap, saying that he framed his acceptance letter to Insurge on his wall. “Had it worked out as a division, I probably would’ve stayed.”

Insurge would be absorbed back into the studio within five years, and Fleischman had long jumped ship to be a part of the early days of Blumhouse Productions. But he sensed the untapped potential of a studio that could take bets on primarily first-time directors.

Together with Fadida, Fleischman said that unlike others that work in the small-budget space or with emerging talent, Defiant Studios is a mini-studio capable of fully financing, developing and producing four to five movies a year and crafting a slate, thus far, that has been over 70% women and underrepresented voices. They even boast that they’ve never gone over budget on a project and have structured their model so they’re not losing money even if they’re waiting for a breakout hit.

Though that’s not to say some of their films haven’t already broken out. Fleischman was a producer on director JD Dillard’s debut film from 2016 “Sleight.” It grossed $4 million (on a budget of just $250,000), but Dillard has since been tapped to develop a new “Star Wars” movie. “John Henry” with Terry Crews saw a second life when it started streaming on Netflix, snagging the top spot on the service’s top 10 list, toppling the Chris Hemsworth movie “Extraction.”

Fleischman and Fadida liken the Defiant Studios model to investing in Amazon when the stock was at $2. And the talent they’ve incubated has already started to catch the eyes of their peers, including Jason Blum.

“I don’t think we’re crazy to say he’s also looking at us and saying, ‘Hmm, what are they incubating?’” Fadida said. “We take it as a massive compliment because if we find these people and Blum wants to use them after. It means that we have good taste.”

“Witch Hunt” from Defiant Studios (Courtesy of SXSW)

Fadida, who has executive produced films such as “The Tax Collector,” “Bloodshot” and the Oscar-nominated “The Trial of the Chicago 7,” found after years of working in the industry that growing the budgets on his films did not always lead to more success but instead only generated more risk. He was impressed by Fleischman’s small budget success and teamed with him on the 2018 film “Monster Party.”

“I made movies for $7 million that didn’t get that much, movies with mega stars. It was mind boggling. Maybe I’m looking at things the wrong way,” he said. “To give this thing a true shot, you have to make more than one.”

But they were surprised to see that their model of financing their movies in a slate rather than single-picture wasn’t being done by anyone else at their scale. It’s not unlike how the major studios approach their films, and they’ve found it to be attractive to risk-averse investors.

“If you took 10 different investors and put them in two different movies, some of them would really love you, and some of them would really hate you because they’ll say you lost me my money,” Fadida said. “A slate solves that. How many times do you hear, ‘Oh yeah we have one investor who says he can do 50% if you can get the other 50%?’”

Fleischman says the initial days of pitching slate financing to investors was a real learning experience with so many indie financiers used to the “one-off” model.

“Once an investor understands and experiences the benefits of slate financing, it’s hard to go back to doing single pictures,” he said. “Slates also attract a wide variety of investors, since it allows for risk mitigation while also posing for high rewards.”

The Defiant Studios model puts investors on a “payment plan:” Financiers make a commitment to a percentage of a slate but only contribute when a particular film is ready to shoot rather than for the whole slate up front. What’s more, they never use a completion bond on any of their films, or a contract that a movie will be finished and delivered on schedule and within budget. It’s allowed them to move faster and leaner on projects with a small budget and has “earned the trust of our financial partners” across the 30-plus films they’ve produced together.

“I had friends who were doing that and were rounding up financing for a $15 million movie, and it lost 99% of its money. To me that sounds like a death sentence for a producer,” Fleischman said. “Doing those baby steps, slowly increasing the money as you prove that you can bring it back has so far worked. And now that that fear is gone and we can look at the business side of it, we’re literally just doing what the studios do.”

Defiant also says they take their budgeting and preproduction very seriously and are extremely strict. They argue anything that isn’t might just be bad producing. And they know that operating with such rigor is crucial to their survival.

“Offseason” (RLJE Films/Shudder)

“If we want to keep this party going, we have to make sure we live another day,” Fadida said. “We have to make sure we’re responsible and we’re not misusing people’s money and we’re applying funds where they need to be. You do it once and twice and a third time, people take notice.”

On Defiant’s current slate of 10 films, 70% of the directors are either female or from underrepresented groups — a goal they said that’s been simplified by a focus on commercial, genre fare. “When you’re underrepresented, you want to have a voice,” Fadida said. “You will fight for it and be passionate because there are not a lot of opportunities for you. We find that most of these people are so passionate that they’ll do anything and everything, and that really fits with what we’re trying to do.”

Defiant prides itself on being a “family-based company,” with much of its talent homegrown and brought in from friends and acquaintances who are already in their pipeline. They hope to establish as part of their brand the idea that they’re a place that can provide opportunities where others might shut the door.

“If I’m a manager, and I’m an agent, and I sign someone new, the first place I need to call is Defiant,” Fleischman said. “It’s what I love because we’ll get phone calls, ‘I just signed this person. You need to meet them.’ Like, yes, that is exactly the mentality that should be here. You should go nowhere else, because anywhere else you go is only going to have a fraction of the pie that we offer.”

As they grow, Fleischman says they’re still committed to nurturing talent, and he envisions having a micro-budget division within the studio, just as he had dreamed when he joined Insurge.

“It was a phenomenal concept,” he said. “Being able to have a studio that is able to do traditional studio fare and has an ecosystem that is focused on finding young talent, mitigating that financial risk and making low budget, commercial genre fare too, existing in the same facility, and I think that’s where we’re headed as a company.”

Brian Welk

Source: Read Full Article