Whether it is something as simple as buying equipment from abroad, paying your stars in the currency of their choice, collecting investments pre-production or commissioning an overseas CGI specialist to make those pyrotechnics really pop...currencies, payments and a sensible way of dealing with the two are important moving parts of an industry that is evermore global. At the moment Film & TV is supporting the banking sector more than the other way round. Let's take a look at how that can be changed.
Given that we are private client broker first and foremost, we won't dwell on how our corporate clients make use of the tailored services we carry just yet.
The more interesting and glamorous side of foreign exchange in the movies is the earnings of actors, directors, production designers and post-production operatives. The individuals who work for large multi-nationals. These are a target for Prime Cap and are, in fact, drivers of our private client portfolio.
When it comes to working with private clients we spend a lot of our time pointing out to would be clients and their advisers just how it is that they could benefit from what we do. If your doctor told you that 70% of head aches were caused by dehydration, you might drink more fluids. Terrible analogy, but, it is no exaggeration to say that around 70% of individuals whose sphere even grazes the world of currencies do not know that they could improve their lot by working with a specialist currency company.
We are not doctors, but we can remove the head ache caused by bad rates, lousy service and pouring one's hard earned kopeks down the drain for want of a simply positioned alternative.
Many astute individuals has turned their celebrity into brands. They structure their professional activities in such a way as to maximise revenue generation through a variety of tie-ins, buy-ins and unions. Now, we find newer stars who have taken to, before their name is necessarily established, bedding in structures that would allow them to scale their persona's far quicker and to greater effect than their pioneering peers.
Social media profiles are as much a part of a starlet's CV as their non-speaking part in Holby City. It will always be the case that the gatekeepers of the industry will take those who could be global across the line, but, in the gig economy, B listers and bit parters have taken to structuring their professional personas as businesses with many activities in multiple territories...and this prompts us to ask about the currency concerns - think Dwayne Johnson's role in 'Ballers' - he recommend a currency broker!
Back when we started we might encounter a footballer moving to the continent, negotiating
his contract in one currency and his club leaning on our services to realise a bigger sum in their home currency. This was vanilla work and happily done. Now though, with countries like the UK and the US able to devalue their currency almost at will, we have a greater input in the FX dealings of our high paid clients. A former national player might go on to coach a team in the far east whilst at the same time living in the US and trying to establish a number of training facilities from which they take a stipend in the UAE. Does your client do this? If so we can assist.
For some lucky actors the journey across the pond for roles is shorter than for others. UK made films funded by US studios. UK made programmes being filmed in EU countries. Stars of the show with personal financial activities in sterling, living in Ireland for 9 months and awards related bonuses paid in US dollars. UK production companies paying Irish set hands and production staff in EUR.
Whilst individuals and businesses in this space all have the need to convert currencies it is arguably the case that the corporate side of this type of work has a better understanding of the benefits of a broker, but, that understanding is not filtering down to the staff...and this is where our approach becomes all the more intelligible.
Using a 'forward contract' allows both employees and/or employers to fix the amount of foreign currency they're paid or are paying. The ability to fix a rate for up to 18 months means that costs need spiral in the face of an exchange rate that could drop.
Whilst the rate of exchange could improve, making sure that costs do not rise is as much a priority for a production company as it is for any business dealing in multiple territories. Furthermore, fixing the cost of a proportion of the foreign currency costs means that any remainder could benefit for that increase in rate...so you're making sure you have an upside window but also have a clear foundation from which to work out your fundraising requirements.
It should go without saying that if 'the talent' are paid in the currency of production, they will face the same poor rates and lousy service when repatriating those earnings. Aside from being celebrated for their acting or sporting ability, they are much the same as any individual needing to convert funds and we treat them accordingly.
Prime Cap is particularly fortunate that we are the exclusively referred broker for a number of London based management agencies and are called on purely to assist their clients with the conversion and movement of funds.
Likewise, we enjoy a rare position as broker to some of the capital's foremost private office and legal firms. You'll notice from PrimeCap.com that we yammer on about our 'referral only' approach to business development. One of the main reasons we take this approach is because it allows us to, in many cases, absorb any margin that would otherwise be paid to an introducer and thereby undercut our competitors.
Dealing exclusively with a lawyer...which means we are the only firm they recommend to their clients, is a way for the law firm to curate whom their client deals with. We share the most intimate details about our structure, exposure and liabilities so as to demonstrate our commitment to competitive pricing for the referred. Furthermore, we are bound by NDA's in a number of instances. Not that this is essential, but it does serve to bind us to those who refer us. We are happy with this, as are they.
If you would like to discuss what we do in more detail and, most importantly, if you would like an assessment as to how we might enhance the way you or your client go about dealing with international earnings, payments and transactions...please do give us a call.