An article over the weekend from WSJ talks about investing in independent films. Interesting to look at this through the prism of someone with decent wealth who is looking for some high risk investments to diversify their portfolio. Here’s how they paint the ideal investor:

Ms. Andrews keeps the investment in its own “sandbox,” outside of Dr. Mattar’s portfolio. “The odds of making money on his brother’s independent film are better than the lottery, but worse than blackjack,” she says. “His financial security cannot rest on investments like this.”

Such investments are best suited for people who already have put aside between $3 million and $5 million to retire and have between $5 million and $10 million in net worth, says Christopher Jones, a fee-only financial adviser in Las Vegas.

The few examples they cite are the outliers of indie films that had small budgets with huge returns, like Paranormal Activity or Supersize Me. Their definition of indie feels more like Hollywood Indie vs true indie. Crowd-funding doesn’t even get a mention, though as of now there’s no platform that’s setup to offer percentages to investors.

As my friend likes to say, it’s basically for people that have Fuck You Money. It’s more interactive than the art you can put on your wall!

Putting your money in a film can pay out in other ways, says Mr. Schwarzman. Unlike art, which arrives already completed, film production is a collaborative, dynamic process investors can witness up close.

It also offers other perks, such as set visits, dinners with actors and directors, tickets to film festivals and on-screen credit.

via Stalking the Next ‘Paranormal’ Blockbuster – WSJ.com.

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