K2 Pictures expands global strategy with new film fund
Japanese studio K2 Pictures has closed a $33 million equity round and aims to raise $100 million to produce 50 films, expanding distribution through a 'Japan plus one' market strategy.
K2 Pictures has closed a $33 million equity round and aims to raise $100 million over seven years to fund 50 films. The K2P Film Fund I closed the equity round in February and has raised $67 million so far through a combination of equity and loans, with plans to add more loans to reach its total $100 million target.
Japan plus one strategy targets global markets
The studio is expanding distribution through a strategy it calls 'Japan plus one'. This approach pairs Japan with specific international markets for targeted releases. K2 Pictures has opened offices in Taiwan and South Korea to distribute films directly in those territories. The strategy also focuses on markets like Eastern Europe, Poland, and Ukraine, as well as the US and France.
K2 Pictures challenges traditional film investment laws
Founder Kii Muneyuki wants to change Japan's film investment laws. He advocates for content securitization, a model similar to real estate investment trusts passed around the year 2000. K2 Pictures was founded as an alternative to Japan's traditional production committee system, which is seen as restrictive to foreign and outside investment. Muneyuki argues that 99.9% of Japan's overseas film business consists of licensing deals, which he believes does little to raise the value of Japanese films abroad.
New films target global and domestic audiences
K2 Pictures completed six films this year, including Kore-eda Hirokazu's 'Look Back' and Son Myung-ah's 'Trophy'. The studio aims to release six or seven films annually, though the pace has been described as pretty tough after one year. A recent project unveiled at Cannes in May is 'The Nuke Crab', a Fukushima-set noir. The film explores the socially taboo subject of people who profited from radiation cleanup funds in the Tohoku region. It is targeting filming next year with an eye on international sales alongside a Japanese release.
The studio's profit-sharing model is calculated title by title, with 70% of profits going to investors and 30% to the creative side. Thirty companies have invested in the fund, including MUFG Bank, Bandai, Dentsu, Development Bank of Japan, Tokyu Land, and Mori Trust. At a recent industry event in Taipei, Kii Muneyuki recalled advice from filmmaker Stephen Chow, who urged Japanese filmmakers to stop imitating kung fu and instead build action films on Japan's own martial arts like karate, judo, jujitsu, and kendo. Muneyuki stated that producers can arrange pre-sales, streaming deals, and sponsorships for debut films to avoid losses.
