Risk Management

·      Policy risk (Commercial Film)

o   The subject locks commercial content, which takes box office income (profit) as the highest purpose and meets public taste and appreciation level. Actors will be those star actors with market appeal and a huge fan base.

·      Production risk (Film Completion Guarantee)

o   It ensures that film and television product invested can meet previously agreed contents and form requirements, and can be delivered on schedule according to budget, so as to guarantee the benefit of investors.

Film completion guarantee: It refers to a financing way for avoiding the risk that film and television production cannot be completed, overspending, overtime, emergencies and other risks, and guaranteeing that film and television product invested by investors can meet previously agreed contents and form requirements, and it can be delivered on schedule according to budget.

·      Output risk (Minimum-Guarantee Issuance)

o   Guarantee investment cost and a certain profit, so that investors and film producers can return funds in advance, and shorten operation cycle.

Minimum-guarantee issuance: An innovative distribution mode in recent years. It is generally divided into minimum-guarantee buyout and minimum-guarantee split, minimum-guarantee buyout means that issuer buys out income right of film box office by paying production cost and fixed income to producer, and producer will not participate in film box office split; minimum-guarantee split means that issuer and producer agree upon consideration, and whether box office will be split according to agreed proportion will be determined by whether box office exceeds the consideration..