First, the Cause

How a bold new venture hopes to shake things up in the movie financing business by focusing exclusively on social themes that can work at the box office

Dressed in a pinstripe shirt and formal trousers, Vicky Dhir, a tall investment banker who uses the ground not as much for walking as propelling his heft forward at immense speed, doesn’t fit the archetype of the Indian film producer. He is now at the Four Seasons hotel in Mumbai to explain why, even if his movies fail, they will not be of the bank-busting variety.

A few years ago, Dhir and a friend, Aditya Mehta, decided to start a fund dedicated to producing socially-relevant movies and backing them up with positive social action. Which meant that if, say, they had made Chak De! India, it would have been accompanied by a programme encouraging girls to take up sport. During a talk in Germany last year, Dhir said they wanted to set up something like a “Facebook for social causes”, a platform for individuals and NGOs to join hands and do good things. That aside, the idea of producing movies with a social message seemed interesting to their advisors, given the high returns of movies underpinned by such causes: Three Idiots, Chak De! India, Taare Zameen Par and the Munnabhai films.

While cause-based initiatives were a new thing, Dhir and Mehta realised that if the enterprise took the form of a fund, there would be serious problems. The film industry tends to be open-ended in every sense, especially in terms of dates; waiting for things to happen could take as much time as, if not more than, actually doing something. A fund would have meant clients handing them money would have to sit back and await the magic. Clients, however, expect results within strictly defined timelines.

So they decided to start a company instead: Cause Entertainment. They identify a film project with an issue-based script, and once the cast, crew and other details are tied up, draft a prospectus for clients in which they set a clear timeframe for returns, with project details and revenue projections from various streams. Each film is treated as a unique ‘undertaking’, a business unit by itself with its own financial plan. Investors need to know everything, they say. And they get their cut of profits only after their clients do. “They need to know that our necks are on the line, too,”  Dhir says.

“People are moving away from nonsensical cinema to something more meaningful,”  says Mehta. For a start, the company is co-producing a movie based on a play about the mathematician Srinivasa Ramanujan, First Class Man.

“When we got here, to be honest, we were surprised in some instances,” says Dhir. “We had heard stories of the industry being disorganised. But there is a group of professionals who believe in working differently. People who believe in identifying roles, goals, and achieving them.” Adds Mehta, “We went around meeting a lot of people at a lot of places. We met Ronit Roy, we met six-seven big studios. We decided that the right way to go about this was to get the right kind of people on board.”

Dhir and Mehta talked Uday Singh, the former head of Sony Pictures in India, into assuming leadership of Cause Entertainment; he has even taken a stake in the company. With him at the helm, and with veterans such as Alex Kuruvilla (Conde Nast), and Sridhar Subramanium (Sony Music) as business advisors, Dhir and Mehta have put together what many would consider a dream team.

Professionals entered Indian cinema in the mid-90s, mostly taken on by Amitabh Bachchan Corp Ltd. A combination of over-aggression and alleged mismanagement (“They drank their own Koolaid,” a former executive said last year) left the company bankrupt and its proprietor heavily in debt. Amar Singh, a politician who was seen as close to Bachchan, derided the company’s senior employees as “soap sellers” at the time. Since then, ‘corporates’ in Bollywood have been viewed as gullible, even clueless, sources of easy money. In conversations with members of the film industry, blame for the rapid escalation of budgets is pinned squarely on large studios that signed on stars for fees in excess of $5 million, even as the industry saw no let up in its film failure rate of over 90 per cent.

Yet, there have been genuine attempts to reconcile professional management with the production end of the business. Saawariya, Sony Pictures’ first production, for example, was directed by Sanjay Leela Bhansali of Hum Dil De Chuke Sanam and Devdas fame. The experience scarred the studio, and Uday Singh left soon after.

However, Cause Entertainment, for one, aims not to invest in large-budget movies. It seeks not to develop scripts either. Its guiding philosophy goes something like this: come in late, get out early. “We’re following a low-profit-low-risk model,” Dhir says. Mehta, who set the idea in motion when he told Dhir he wanted to do more than be an investment banker (they had discussed this kind of venture earlier but let it lie), says the company’s investors, a mix of local and international clients, will be happy with returns of 15-17 per cent. “There will be regular audits. We’ll have it down to the cost of a button [on a coat, or shirt].” Credibility is the key, they hold.

In contrast, Cinema Capital Venture Fund, a rival initiative backed by ICICI, promises a ‘ticket to blockbuster return (sic)’ on the first page of its March 2010 newsletter. Its first investment was in the Vipul Shah movie Action Replayy, which tanked. It invested in Priyadarshan films, as well as a Rahul Bose movie that didn’t release on time. The last line of the newsletter says, ‘The source of information is as quoted or from reliable news sources, market sources and Cinema Capital cannot guarantee the veracity of the form.’

Recent years have seen the introduction of several film-based funds advertising the growth potential in an industry that sometimes struggles with professionalism and accountability. These include Vistaar religare film fund, Cinema Capital, Nomad Film Fund, DAR Capital, Morpheus Media Fund, and India Value Fund. But none of these stands out the way Cause Entertainment does for its social intent. The social bit is the most important, says Dhir. “We wanted a double-bottom line,” he says, “It’s not just about movies and media and entertainment, but bringing about change using media and entertainment as a platform.”

For its first movie, Cause Entertainment has Oxfam and a Kolkata-based NGO for children as partners. An Oxfam spokesperson expresses delight at the tie-up, saying the organisation would be shown the script soon. “We will recommend things,” says the spokesperson.

Aren’t returns, though, the main aim of investors? Dhir says the promise of returns is what attracts investors, and if they happen to be part of a good thing, well, they would like that too.

Of course, cinema is a chancy business with no clear factors of success. To acquaint themselves with risk to the extent possible, Dhir and Mehta run what they call “what if” models, using random simulations. “What happens if it is cricket season? What happens if there are elections? If it’s summer, if there are school breaks? You run scenarios to see whether everything’s okay, like there’s no IPL, there’s no elections… and then you release the film….”

At this point Dhir takes over to say something surprising. “Yeah, you see how effective this combination of actor-director is…” This point suggests an affinity for the traditional Bollywood love of jodis—lingo for a combination that works. But then he pauses, and says, “It’s a simple model, but there are just so many parameters.”

How do they assess scripts? The cause comes first in the chain of approval, after which they run it by a team of creative advisors that includes Shabani Azmi and Anurag Kashyap, among others. Then comes the other stuff, the most challenging. The script needs a director, actors and commitments. “This is the difficult part,” Mehta says, wincing.

Last year, after Dhir and Mehta wrote an article about how they began for The Wall Street Journal, a Mumbai-based producer asked: “No one is going to say no to money, especially in the Indian film business. Cause-based cinema is a great idea on paper, but how do you get it to work? Scripts change frequently…What if the message changes? How would you stop an unscrupulous big-name director/writer from taking you for a ride?”

It’s a pertinent question, but there’s some hope because they are guided by people who know immense success as well as brutal failure. And unlike many others who invest funds in films, they work within strict parameters. “For us,” Dhir says, “It’s not about greed.”

About The Author

Rahul Bhatia