From Becoming Penguin's Major Shareholder to Building an Entertainment Empire

Note that this book is a slow-burn novel, and it will become increasingly exciting as the story progresses.

It starts from 2002, beginning at the Beijing Film Academy, and starting with the H...

Chapter 12 The Reason for Making Movies

After seeing everyone off, only Chen Jingfei, Liu Xiaoli, Liu Qianqian, Shen Fang, and Huang Bo remained.

Chen Jingfei looked at Shen Fang and the drunken Huang Bo: "Xiao Shen, where do you live? I'll take you there."

Shen Fang smiled and waved his hand: "No need, someone will come to pick me up in a while. Uncle Chen, Aunt Liu, Qianqian, you can go back now."

Chen Jingfei nodded and led the two into the car. The car started, and Shen Fang waved goodbye. Liu Qianqian, the little girl, poked her head out of the car window and looked at Shen Fang: "Brother Shen Fang, remember to call me! Come visit me sometime!"

Shen Fang smiled and waved his hand: "I know."

Watching the car disappear from sight.

Shen Fang patted Huang Bo on the shoulder as Huang Bo was squatting on the ground counting ants: "Hey, Brother Bo, are you alright?"

Huang Bo struggled to his feet. His steps were unsteady, and he staggered as if he were about to fall at any moment. Shen Fang quickly helped him up.

"Alright, Brother Bo, you had a great drinking buddy today. Everyone drank well."

Huang Bo burped: "They're all heavy drinkers. I almost threw up from drinking too much, but I managed to hold on."

Shen Fang supported Huang Bo in the cold night wind. A moment later, a red Mazda pulled up in front of them, revealing a chubby head.

"Third Uncle, is your friend alright?"

Shen Fang looked at the fat man with a meaningless expression: "Aren't you going to come down and lend a hand? Can't you see he's drunk?"

Huang Bo shook his head: "I'm not drunk, I'm not drunk, who's drunk...?"

Shen Kun quickly got out of the car and helped Huang Bo, the two of them using their strength to push Huang Bo into the back door. Shen Fang got into the passenger seat, looking at the drunken Huang Bo.

"Looks like he's had too much to drink. Let's go, Xiao Kun, back to the West Mountain Villa."

Shen Kun started the car.

On the road

With a cigarette dangling from his mouth, Shen Kun said, "Third Uncle, why do you insist on investing in Director Zhang's movie? It's 20 million! With 20 million, we could invest in so many ads!"

Shen Fang lit a cigarette, enjoying the cold wind as he looked ahead.

"Zhang Yimou's movie has so many big names, it can't lose money. Even if it does, it won't be much. Spending a few million can promote our brand in a movie that grosses over 100 million. It's a great deal. Besides, what I want is an admission ticket, and this 20 million is my admission ticket."

"Third Uncle, it's just making movies. You're going to the Beijing Film Academy now, and once you graduate, you can make whatever you want with the money. Why do you have to go and give them your money?"

Shen Fang rolled his eyes at Shen Kun: "Fatty, what do you know? If it weren't for the fact that I'm a student at the Beijing Film Academy and have connections with Wang Hui, would I even be able to get investment? No way. Do you think the film industry is easy money? You think you can get into this business without paying tuition? Dream on. It's a very deep and dangerous place."

Shen Kun asked curiously, "Third Uncle, tell us about it, so we can broaden our horizons."

Shen Fang stretched.

"First of all, making movies is not as simple as you think, especially in China nowadays, where basically every movie we make loses money."

Shen Kun asked in confusion, "Then why are there still so many people making movies? Are they involved in some kind of scandal?"

Shen Fang smiled and said, "They're not stupid."

"Besides box office revenue, movies also generate revenue from online, television, and DVD copyrights. In addition, after making some actors famous, they can earn a lot of endorsement fees, appearance fees, etc. Therefore, many movies are actually profitable in general."

Then there are the unspoken rules. Investors, producers, directors, and others make movies with one purpose: to sexually exploit actors (mostly actresses), and therefore they are willing to tolerate the risk of losing money.

There are also government subsidies. Some documentaries and films with a patriotic theme receive subsidies from government departments.

Another major source of revenue is product placement. Some films recoup a significant portion of their costs through product placement.

Others use it for money laundering. For example, some films use dual contracts: the official contract for an actor is 3 million yuan, but the actual private contract only pays 500,000 yuan, leaving 2.5 million yuan laundered. Many films exaggerate their investment amount and then inflate box office figures, thus legitimizing a large sum of money.

Shen Kun nodded: "Wow, there are so many tricks to it."

Shen Fang smiled and said, "This is only a part of it. When the domestic film industry develops in the future, a movie can bring in ten times or even dozens of times the profit. An investment of 100 million can turn into 1 billion in just a few months. If it were you, would you do it?"

Shen Kun nodded repeatedly: "Yes, we definitely have to do it. Only a fool wouldn't. It's faster than robbing money."

Shen Fang tossed his cigarette butt into the night sky, like a shooting star falling from the night.

"There are many benefits. Once your company goes public, even if the movie loses money, you can still take the opportunity to hype it up and make money from the secondary market. You can also make some series films, create a general IP, and eventually build a whole theme town, toys, animation, and games. All of this will generate a lot of money. I want to get into this business not just because of the girls."

Shen Kun asked doubtfully, "Third Uncle, these things you're talking about aren't available in China yet, right? They're only available abroad."

Shen Fang: "Just because it's not happening now doesn't mean it won't happen in the future. The domestic economy is booming right now, and people are starting to live better lives. The cultural industry is a hot sector. Even if we lose money now, we have to stand firm and lay a solid foundation, understand?"

Shen Kun nodded: "I understand. It's just about investing upfront and then making a quick buck later."

Shen Fang patted Shen Kun on the shoulder: "Alright, your two years in Hong Kong haven't been wasted. You've entered the industry today and unexpectedly met Chairman Han of China Film Group. Things will be much easier from now on. Fatty, work hard with your third great-uncle from now on, and he won't let you down."

Shen Kun smiled: "Uncle, you've been exceptionally smart since you were little, unlike anyone else. I'll definitely follow you and work hard. To be honest, sometimes I think you're like an alien. If I hadn't changed your diaper when you were little, and you even peed on my hand, I really would have thought you were an alien. At 12, you were already convincing my great-grandfather to start a snack processing business and sell it overseas. By 18, you were a true self-made millionaire. Who the hell would believe that?"

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