Sramana: Were you working only with German cinemas?
Tobias Bauckhage: Yes, we did all of this with independent films in Germany. The takeaway is that if you have a movie that works and you can get word-of-mouth publicity behind the film, then you can get 150,000 people to attend the film. That equates to €300,000 to €400,000 just out of cinema. If that happens, then there is also going to be interest in getting the DVD rights to the film. That will usually bring in another €100,000 or more. There can even be additional TV or distribution rights in other countries. When it works, it can be lucrative.
In Europe there is a lot of film funding because the markets are so small that the government decides to subsidize the area. We worked our way into that as well and they liked us because we were young, aggressive, and had great ideas. That helped us get funding for some films to cover 50% of our costs.
Ultimately, we ended up making half a million with just us two co-founders and one intern while still working out of the garage. The initial plan was not to do film distribution. We wanted to do that just to learn how to disrupt the industry, but after we made that money we thought about perhaps just doing distribution for a bit. It was a lot of fun, we worked with great people, and we wanted to learn the industry a little bit more. At that point we also co-produced two movies.
Our fourth movie was Bye Bye Berlusconi, which was very funny, tanked completely, and we lost all the money that we made on the second movie. We overestimated our success. We had a huge viral campaign for that film. The idea of the film was that the average Italian was so fed up with Berlusconi that they wanted to take him to trial on the Internet. When the film maker started the film, they told him that they could not do that, so they changed the film to become a movie about a film team asking their lawyers how to do that type of movie, which turned into a comedy.
Berlusconi was played by Maurizio Antonini who was a shoes salesman from Rome who looked very much like Berlusconi. We had a wild campaign taking advantage of that. Another thing is that Peter Jackson had the movie King Kong out that year. We called Universal back then and told them we had an off protocol secret visit from Berlusconi and that one of his colleagues told us he was a huge fan of King Kong, so we wanted to get him into the premiere. We did that call about a half hour before the red carpet opened and Universal was really excited. We had booked a limo for him and we had a camera team and we all went to that premiere.
At the end of the day the guerilla marketing campaigns around Bye Bye Berlusconi were more successful than the movie. That reminded us why we were trying to change things and do them differently. We started to think of a business model that would let us be in the middle of the disruption. This was around 2007 when we went started this next phase.