A cryptocurrency to the rescue of French cinema. Because the work of developing films, from their writing to their production, struggles to find adequate funding, Sarah Lelouch and Fabien Berger, of the company The Diversity of French Cinemaare launching this Thursday, April 28 a new currency, the KlapCoin in order to attract investors ready to participate in the adventure of around fifty consumer projects where the creative, technical and financial process is part of the logic of the blockchain. and NFTs.
What is KlapCoin?
Sarah Lelouch: It was all the same incredible that there was no money for cinema when the methods of financing had reached their limits. We know the aid from the CNC, the Sofica, the regions, which are often reduced and which are reaching the end of what they can offer. Today, French cinema is drastically lacking in money, especially for film development. And we wondered what alternative mode of financing to find? And this is where the idea of creating a cryptocurrency imposed itself on us, the KlapCoin. We dug well before launching it to make sure we were the first. And we are the first.
Fabien Berger: We could have contented ourselves with creating a private fund specializing in the development of cinema. And we explored this track. But very quickly, we had a no go because we realized that regulatory, legal and technical constraints required us to raise between 20 and 30 million euros to reach a breakeven point for this type. of funds. But above all, this type of financing requires a minimum investment of several tens of thousands of euros, which excludes the vast majority of potential investors.
However, we wanted to do a project that is very horizontal, that affects everyone, that can be accessible to as many people as possible and so that’s why we opened it to the general public from €1. We really wanted to create something virtuous and that’s what the blockchain offers: Web 3 makes it possible to create a community and unite investors. The Pacte law (action plan for the growth and transformation of businesses) of 2019 has opened up a legal framework for this method of financing, which is becoming simpler, even if it requires knowing how to code to write in the blockchain and access it. .
How did you design this Web 3 framework?
FB: We are developed on the third generation Tezos blockchain, which is important to us because of its environmental advantages. Bitcoin and older generation blockchains have been widely criticized for their enormous, monstrous energy and ecological cost. While the energy cost of one year of this third generation blockchain is the equivalent of 17 citizens of the world. Tezos is ecologically very responsible.
SL: It is important for us to be green and virtuous wherever we can be today, in the world in which we live.
FB: Our other partners have also been carefully chosen: Exaion, the start-up specializing in cloud and Web 3, a 100% subsidiary of EDF, or the Nomadic Labs laboratory.
How are you going to encourage the general public to invest in this cryptocurrency?
SL: With associated benefits and rights. Investing in KlapCoin will make it possible to obtain places in previews, to spend a day behind the scenes with actors, to have the right to vote… If the production hesitates between two film titles, they will be offered to the community who will vote for their favourite. We are on a register of mainstream film projects selected by a committee of professionals chaired by Julie Gayet and we are talking about a community which, we hope, will include between 20 and 30,000 investors. A panel that will say which title he prefers or what kind of film he wants to see developed, it gives a trend of what the public expects. It’s an incredible added value. The difference with crowdfunding or participatory financing is that the investor, as its name suggests, will invest and will be financially interested in the economic success of the film.
FB: With this mode of financing, the investor is an actor of his participation, he votes, he holds artistic rights. And above all, it will have profitability, a gain on the return on investment of the works developed. We are rather part of a long term, with the creation of a community which would be the KlapCoin community, whose investments will cover all development and creation costs, which will allow, not to free up 300 % profit, but to report a reasonable return on investment. That’s why we talk on the KlapCoin of a gain of 5 to 7% per year.
Who says crypto currency says blockchain, and blockchain is transparency. How do you plan to be transparent?
FB: Transparency is provided for at all stages of the project: the creation stages, the financial stages, the legal stages. On the artistic level, the investor will be informed throughout the development of the works, the progress of the projects in progress or those which are entering the catalog, and the community will be invited to give their opinion. For the financial part, there will be reports with dividend payments in cryptocurrency on the works in our catalog that we will have developed and monetized, that is to say sold to producers to make a film. All this in complete transparency.
At some point, transparency is bound to have its limits… What are the safeguards to avoid plagiarism or the theft of screenplay ideas?
SL: Scenarios and projects will remain hidden until a certain stage of investment. And all these projects will be ultra-secure thanks to the blockchain. Speaking of NFTs, every project is going to be an NFT. A “NFT contract” which will follow and which will trace all that will have been signed, in fact.
How are you going to put together the catalog of films whose development you are going to finance?
SL: There are a few steps before the project arrives at the committee of professionals gathered around Julie Gayet. Because if we had to submit all the projects to the committee, I think they would all stop working… How will it be? You must already file a file on the la-dcf.com site. Once they submit this project, it must be eligible, with all the required documents, synopsis, mood-board, estimated development estimate, and then there is a pre-selection in which I participate to see if the project has potential. Which will skim.
And that means how many projects?
SL: Our objective is to raise 8 million in six weeks, in order to have enough to finance the development of around fifty films. The selection process is important because we have already received 70 projects without appealing for the moment.
You announce that you are betting on a catalog of popular films or series, for what reason?
SL: Popular, mainstream, very focused on young talent. There is this sentence from my father [Claude Lelouch, NDLR] : “The public is always right… even when they are wrong”. By betting on mainstream films, we have a better chance of having commercial success than with an auteur film, but it is also a real family but also personal desire to be in contact with the public. And what is extraordinary in this project is that the whole community, the whole public will really participate actively in the development of cinema. And that is a a real novelty, and I think it’s a real added value to have access to this community, when you want to make this type of film.
How does the film industry perceive this new method of financing?
SL: They are watching! It’s not yet the enthusiasm, but there is a lot of curiosity. Everyone thinks the project is great, so that’s already not bad, and that the model holds up, which encourages us enormously. We accumulate appointments because many people are interested, either to invest or to submit their project. Producers are beginning to understand the value of investing in order to have access to our catalog of projects in development.
FB: At the Cannes Film Festival, we are going to participate in round tables, to talk about the technical and legal aspect of crypto, NFT… It is important to also exchange with the rest of the profession with the aim of creating a common base.
The launch of KlapCoin this Thursday, how will it happen concretely?
FB: Just come to the platform site la-dcf.com.
SL: You can pay by credit card for example. If you have crypto, you can pay with your crypto.