The way to make a small fortune in the movie industry — including with hits such as Tsotsi — is to start with a large fortune.
Despite its Oscar, Tsotsi will not be a great moneymaker, says Peter Fudakowski, producer of Tsotsi and head of the UK Film and Television Foundation, which financed 50% of the movie. The foundation and the Industrial Development Corporation (IDC) are more or less equal partners in the venture, with the National Film and Video Foundation also making a contribution.
“In order for any movie to break even, it needs to make 10 times more than the initial investment,” says Fudakowski, who read Athol Fugard’s Tsotsi 10 years ago and, three years ago, convinced director Gavin Hood to come on board with the project. Hood wrote a new script, which secured the financing.
The film cost an estimated R30million to produce and promote. “People often forget that the costs of a movie are more than just the making of it.” There are also the costs of writing the script and marketing the movie, and the costs of financing and distribution.
In order for Tsotsi to break even, it would need a R300million worldwide turnover, bearing in mind that large distributors take about 40% of the revenues.
As for revenues from South Africa, Fudakowski is not holding his breath. “There is never any real profit from the local market.” The reason for this lies in expenses. An estimated 60% of revenue will go to theatrical costs. And, again, there are the additional costs of printing and advertising.
“At the moment, we are expecting a turnover of about R3million in South Africa,” says Fudakowski. “R6million if we’re really lucky.” Only an estimated R300 000 to R600 000 will go to investors.
But not all is gloomy in the financial world of Tsotsi. Fudakowski is not predicting a loss. “On paper, we have already recouped our investment,” he says; the rights of the movie have been sold to different distributors. “When we sell the rights, we get a minimum guaranteed return,” he says. “Anything extra is net profit.”
Fudakowski is also optimistic with regard to the future of film production in South Africa. “The Oscar is a huge boost for South African producers and financiers.”