‘Monkey’ puts feather in crowdfunding’s cap
Print Edition
The overwhelming success of a China-made animation has trained the spotlight on a burgeoning mode of Internet finance — crowdfunding.
The novel fundraising channel impressed many Chinese movie-goers when “Monkey King: Hero is Back” presented a long producer list that included 109 children, whose parents pooled money to aid in the movie’s marketing.
Due to the film’s immense box office success, those investors, who ploughed in a combined 7 million yuan (US$1.1 million), are now set to get more than 30 million yuan in return.
As of Tuesday, “Monkey King” had taken 700 million yuan, beating “Kung Fu Panda 2” as the top-grossing animated film in Chinese cinemas.
Producer Lu Wei said he posted the crowdfunding bid on WeChat late last year when the film was near completion. The largest donation by a parent was more than 100,000 yuan.
“Their participation contributed greatly to the movie — they are not just funders, but also enthusiastic promoters who advertised the film,” he said.
The concept of crowdfunding, which allows projects to raise funds from a large number of people via the Internet, is gaining traction in China where the government has been encouraging innovative fundraising to help money-strapped business startups.
Figures from Yingcan Consulting show China’s crowdfunding platforms increased to 211 by the end of June, raising more than 4.6 billion yuan in the first half of the year.
Despite the boom, crowdfunding remains distant from the general public. Ai Haiqing, co-founder of a crowdfunding website keddoo.com, said most projects have high capital thresholds and only solicit professional investors.
The projects on large platforms (with low or no investment threshold) are mostly rewards-based or public interest activities. Equity crowdfundings (promise shares in a company or film) are rare, Ai said.
Their foray into China’s booming film market to target ordinary movie-lovers is also viewed as more of a marketing stunt to encourage “investors” to go into the cinema to support their own “products” rather than suppliers of much-needed funds.
“China’s movie industry does not lack hot money. Good projects can easily ensure funding and thus need not resort to crowdfunding,” said a producer at a Zhejiang-based movie-making company.
“Some (films) launched such projects to expand the movie’s fan base and encourage public participation,” he said.
“What they offer are more like a finance product, which promises fixed return rates instead of making you a shareholder of the film.”
Crowdfunding can boost a film’s popularity, but investors usually have no say in its production. Movies that have trouble getting venture capital may also find little luck in crowdfunding, Lu said.
Industry insiders said it will take a while for China’s crowdfunding to grow into a mature fundraising channel to benefit both small investors and businesses. The sector needs better transparency and risk control as well as more success stories to boost public confidence.
“The sector needs to make a fortune before it can tell its stories,” said Li Qunlin, chief executive of crowdfunding site dajiatou.com, adding that the market needs time to bloom.
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