In this Business Intelligence, produced in collaboration with Rhizophora Ventures Sdn Bhd, the company discusses its commitment to a significant investment programme in support of its aim to revolutionise the creative and media sector in Malaysia and the ASEAN region.
ADVANCING MALAYSIA’S CREATIVE AND MEDIA ECOSYSTEM
Rhizophora Ventures Sdn. Bhd. (RVSB) is transforming Malaysia’s creative and media (CAM) sector through a number of investment initiatives across creative content, infrastructure and human capital development.
The investment holding company, wholly owned by Khazanah Nasional Berhad, seeks to catalyse the development of a local and regional CAM ecosystem and boost the commercialisation of Malaysian media content. RVSB’s participation in this sector enables the opportunity to build local capabilities, raise Malaysia’s profile as an international creative industry hub, and provide spillover economic benefits to the local tourism, financial and education industries. As part of RVSB’s wider strategy, the industry leader supports the development of an ASEAN filmmaking community. This process will allow CAM sector participants in ASEAN countries to collaborate more freely in creating content for the whole of the region.
The strategic aim behind RVSB’s decision to undertake such a significant investment programme is to transform Malaysia into a world-class player in the creative content industry. This investment, as well as the establishment of several wholly owned subsidiaries, characterises RVSB’s commitment to the long-term goal of transforming Malaysia into a regional hub for the creative content industry and bolstering development in Iskandar Malaysia.
PROVIDING FINANCIAL SOLUTIONS
The availability of financing is key to the growth of the creative content industry in Malaysia. As such, RVSB is spearheading the development of a financial community to support Malaysia as a creative content hub for the region and to address challenges faced in securing funding for CAM sector projects.
Despite generous incentives provided by the Malaysian government, the lack of a developed financial ecosystem to support the creative arts, combined with a limited knowledge base, pose a challenge for industry players seeking to secure funding for film and television projects. RVSB provides accessible financing solutions through its subsidiaries Rhizophora Capital (RC) and Sonneratia Capital (SC).
Rhizophora Capital (RC), in conjunction with the Film In Malaysia Incentive (FIMI), plays a critical role in fostering the development of the CAM sector and attracting new projects to the region. The funding vehicle for media content producers was established to respond to challenges associated with securing funding from the government-backed incentive programme by offering loans to film and television producers.
RC has provided FIMI rebate loans for the first two seasons of the television series Marco Polo, produced by The Weinstein Company, as well as for two other foreign productions and two local productions.
The FIMI financing mechanism is calculated according to the total amount of qualifying Malaysian production expenditure spent in-country and is disbursed following the completion of a particular project.
RC’s offering, secured against the FIMI rebate Provisional Certificate, provides producers with invaluable cash flow for production. Loans are subject to a discount based on the risk assessment of each individual project.
The FIMI scheme was approved in 2012 by the National Economic Advisory Council to support the growth of the country’s film and television industries and is available to both domestic and foreign national producers.
In addition to the provision of loans, RVSB offers co-financing options to the Malaysian film industry through its wholly-owned subsidiary, Sonneratia Capital (SC). The aim of this venture is to expand the country’s presence in the global film industry by facilitating the international distribution and commercialisation of Malaysian films. In order to enhance the production quality of projects coming out of the country, SC is co-financing Malaysian film projects through film slate financing via equity investment.
The company has already committed investment to film slates with three local production companies: Dain Said and Nandita Solomon’s Apparat; Lina Tan’s Red Films; and Adrian Teh’s Asia Tropical Films. It also plans to invest in two additional slates with distinct Malaysian production companies in the future.
The first three films to be produced under this initiative are being co-financed by SC and different partners: a private investor; the Singapore-based Clover Films; and Emperor Motion Pictures from Hong Kong. Furthermore, each of the films has also obtained distribution outside of Malaysia.
To qualify for the financing options, applicants must, for example, demonstrate a proven track record of commercial or critical success at the Malaysian, regional or international box-office or on the festival circuit. Once the investment has been secured, selected recipients are held to international standards of production management, reportage and analysis.
SC has put into place stringent selection and production requirements for recipients of financing in an effort to support the development of an increasingly accountable and sustainable film industry in Malaysia.
SC is an active investor in the development, pre-production, principal photography and post-production of each film, and across the slate in general, investing up to 70 per cent of the budget of each particular project. The individual production company is responsible for financing all remaining costs, as well as marketing and distribution expenses by means of fundraising from strategic investors, financiers or distributors.
INNOVATING THE INDUSTRY
RVSB is driving the expansion of a creative and innovative ecosystem in Malaysia, researching and developing inventive technologies and techniques for global use. The company’s investment in the Imagineering Institute and The Imaginarium Studios represent commitment to leading not only the creative industry forward, but also Malaysia as a whole.
Through the use of internet and digital media (IDM), the Iskandar Malaysia-based mixed reality research laboratory, the Imagineering Institute, provides an entrepreneurial incubation space for start-ups and also functions as a research facility. The institute, also known as the IDM Lab, seeks to augment Iskandar Malaysia’s creative and innovative ecosystem by ‘inventing the future of the internet’. The impetus behind its creation is to increase the impact of domestic-based research in the relatively nascent IDM industry in Malaysia by undertaking research and development.
Led by Adrian Cheok, former Professor of Pervasive Computing at City University London, the institute is a joint collaboration between Osaka University Japan, Universiti Teknologi Malaysia, Multimedia University and City University London. It is dedicated to the imaginative application of engineering sciences, termed ‘imagineering’, which involves three key concepts: Imaginative Envisioning, Future-casting and Creative Engineering. Under this approach, the laboratory conducts research, development and monetisation in areas including mixed reality, internet digital media, pervasive computing, multisensory communication, and wearable technology.
As the first laboratory of its kind in Malaysia, the Imagineering Institute integrates blue-sky research with an accelerator programme for start-ups through the commercialisation of intellectual property. It also provides entrepreneurs with the opportunity to work collaboratively with academic researchers, allowing them to combine their commercial expertise with technical knowledge, resulting in mutual benefits for both parties.
The goals of this multi-disciplinary research endeavor are numerous: augment the creative and innovative ecosystem in Iskandar Malaysia; support national entrepreneurs; pursue the country’s strategic agenda; generate ideas for investment; and develop and boost the digital media industry in Malaysia. As part of these efforts, the institute employs top researchers and PhD students to conduct research to be published and disseminated across prestigious academic journals and at leading international academic conferences.
Moreover, by emulating an incubator startup programme, the institute is able to develop the local talent pool and support R&D efforts towards commercialisation. Participants of this programme stand to benefit greatly from the institute’s physical infrastructure and its extensive global network of academics, corporations and Malaysian government-linked companies. Likewise, the successful commercialisation of projects emerging from the institute, in conjunction with partnerships with renowned research laboratories and academic institutions, will allow the Imagineering Institute and Iskandar Malaysia to enjoy global recognition, while simultaneously ensuring a sustainable pipeline of talent into both the IDM field and Malaysia in general.
The Imaginarium Studios
Moreover, RVSB is seeking to innovate and enhance film-making techniques available to Malaysia and the region through its strategic investment in The Imaginarium.
Driving the next generation of storytelling capability across film, television, video games and digital applications, The Imaginarium Studios combines state-of-the-art technology with high standards of execution.
The production company and studio specialises in performance capture, a technology that utilises simulation software to transform the performance and movements of actors into digital characters.
Founded in London in 2011, the company is the brainchild of actor and director, Andy Serkis, and producer, Jonathan Cavendish, and has been involved in such high profile projects as the Star Wars and Avengers movies series. To date, it has successfully brought together leading technicians in the field to provide the highest level of character creation and storytelling across multiple media formats.
As a result of RVSB’s partnership, The Imaginarium Studios Asia Pacific was officially incorporated within Pinewood Iskandar Malaysia Studios in December 2015 with the purpose of establishing a central hub of production excellence. Training has been provided to the Malaysian team both on site and at the studios in London. Through this endeavour, RVSB is capitalising on the experience of The Imaginarium to enhance film-making techniques and improve opportunities available to Malaysia and the region.
FOSTERING TALENT AND CAPABILITIES DEVELOPMENT
RVSB is expanding Malaysia’s global footprint on the film and television industry through the generation of exciting new creative content for international audiences and the development of new talent.
Excellence in production, the generation of original content and human capital growth are fundamental components to expanding the Malaysian creative content industry and developing the country as a CAM sector hub. RVSB recognises the importance of realising these goals, as exemplified by its investment in Ideate Media as well as its financial support of the MMU Cinematic Arts Programme.
Thanks to its joint venture with Astro Overseas, RVSB is involved in a number of exciting film and television projects by Ideate Media that will help establish Malaysia as a creative content hub.
Ideate Media is following the production of Sydney Sailboat, a children’s animation series that has reached international audiences, with the new television series, Dirk Gently’s Holistic Detective Agency. The television adaption of Douglas Adams’ successful Dirk Gently series of novels is a co-production between AMC Networks, IDW Entertainment, Circle of Confusion and Ideate Media, which has screened successfully on BBC America and was released on Netflix in December 2016.
In addition to developing, producing and commercialising high-quality content for global audiences across a range of multiple formats and genres, Ideate Media searches for talent and stories that are capable of engaging global audiences, with a specific focus on the incorporation of Asian elements, settings and themes.
For example, the production company purchased the rights to works written by Malaysian novelist Ramlee Awang Murshid, including the bestselling novel Tombiruo. Ideate Media, in association with the Karangkraf Media Group, intends to develop a shared universe or franchise from Ramlee’s work that will include feature films, TV shows, animated shows, comics and mobile products.
MMU Cinematic Arts Programme
As a major financial supporter of the Iskandar-based Multimedia University (MMU) and its Faculty of Cinematic Arts, RVSB seeks to foster the development of Malaysian human capital in the CAM sector, in line with its goals for industry expansion. As such, it is providing students with the opportunity to gain important experience working in the creative arts, as well as offering financial assistance through the Cinematic Arts Programme (CAP).
CAP enables students to explore a wide range of cinematic art forms, in addition to the social and industrial contexts in which they are produced and consumed. CAP was co-developed with the University of Southern California School of Cinematic Arts and is held at MMU’s purpose-built campus, which is equipped with state-of-the-art production and post-production facilities.
RVSB offers a range of financial assistance for CAP applicants, including academic, merit and production scholarships. Moreover, RVSB works closely with the faculty to offer intern- ship opportunities across its investee companies, as well as a number of additional forms of financial cooperation, including funding for equipment, a filmmaker in residence scheme, international visiting lectures, and training programmes for early career academics. Through support from RVSB, CAP provides students with invaluable training and experience that will allow them to lead Malaysia’s creative content industry forward.