January 1, 2021
Film Finances Inc. (FFI) was formed following the severe financial crisis that afflicted the British film industry from 1947 to 1949. The losses that the big film corporations in Britain (most notably the Rank Organization) incurred in their production activity during this period caused them to cease to provide direct finance for film production and to rely instead on distribution guarantees (i.e., they would get the feature films they needed for their cinema chains by guaranteeing to distribute films made for them by independent producers rather than producing those films themselves; on the strength of the guarantee, the independent producer could then raise money from the bank, but they – rather than the film corporation − would be taking the risks of production.) At about the same time, to alleviate the severe difficulties independent producers were having in obtaining finance, the British government set up the National Film Finance Corporation. The independent producer would raise about 70% of the budget from a bank on the security of the distribution guarantee, and would then turn to the National Film Finance Corporation (NFFC) for the ‘end money’. As the distribution guarantee only came into effect upon delivery of a completed film and lenders, whether the banks or the NFFC, needed assurances about the effective use of their money, the completion guarantee, which FFI pioneered, became a cornerstone of this new system of British film financing.
In return for a percentage of the budget, FFI would guarantee lenders that the contracted film would be delivered to the distributor “on-schedule and on-budget.” FFI would only issue a ‘bond’ once it was satisfied that the independent producer was able to meet a set of stringent conditions relating to the production of the film. In the very few instances, where a production it had guaranteed got into serious difficulties, FFI had the right to take over and finish the film.
To fulfill its role successfully, FFI acted as both mediator and production consultant. It required a producer to undertake the most rigorous preparation before a film went on the floor and continued to monitor the progress of the production closely. It was ultimately an insurer, but had its own considerable film expertise.
The company was incorporated on 24 February 1950. Its founders were a Lloyds underwriter, Peter Hope, and film producer, Robert Garrett. As Wing Commander in the RAF during the war, Garrett became head of the Air Section at the Government Code and Cypher School at Bletchley Park, famous for cracking the Nazi Enigma code. After the war he had been associated with Constellation Films, a company created by Anthony Havelock-Allan, who had produced the early David Lean films, Brief Encounter (1945), Great Expectations (1946) and Oliver Twist (1948).
As Hollywood began to pour money into UK and Europe-based productions in the 1960’s, FFI assumed an increasingly international dimension, as it does to this day. The production of the film Dr. No (1962) is a prime example. The Hollywood distributor, United Artists, only agreed to back Saltzman and Broccoli’s first James Bond movie on condition that their company, Eon, acquire a completion guarantee with FFI. The arrangement was a way of UA assuring itself that there would be some degree of control over a production that would be far from its own doorstep. Although the phenomenal success of the Bond films meant Eon would not need to rely on a completion guarantee in the future, many other celebrated Hollywood-backed, but Europe-based productions used FFI as a similar means of control: e.g., Tom Jones (1963), which won the Best Film Oscar, The Ipcress File (1965), or Cabaret (1972).
In the early 1970s, Richard Soames joined FFI, replacing Robert Garrett as managing director. Soames pursued an expansionist policy, expanding the business to Canada, Australia and the US. The climate of international film-making encouraged this development. The traditional Hollywood “majors” were now being joined by a number of new independent companies such as Orion, New Line and Hemdale that regarded the completion guarantee as an important element in their financing objectives. Additionally, Canada and Australia benefited from the introduction of tax incentives designed to encourage the development of an indigenous film industry which led to may independent producers seeking completion bonds to provide the necessary reassurance to the banks.
An important milestone for the Company was marked in 1982, when FFI provided a completion guarantee to Francis Ford Coppola for the films Outsiders (1983) and Rumblefish (1983). After the troubled productions of Apocalypse Now (1979) and One from the Heart (1982), which had gone disastrously over-budget, the studios were reluctant to work with Coppola. FFI’s readiness to take the risk enabled Coppola to make a successful comeback. The following full-page advert ran in Variety: ‘Film Finances Ltd congratulates Francis Ford Coppola on completing principal photography of The Outsiders on schedule and on budget.’ Given Coppola’s then reputation in the industry, the message, ‘on schedule and on budget’, was a powerful calling-card which remains to this day. Other notable productions that the company guaranteed in this period include Nightmare on Elm Street − whose success was so important to New Line that the studio is often referred to as ‘the house that Freddy built’ − Terminator (1984), Salvador (1986) and Platoon (1986), the second film guaranteed by FFI to win the Best Film Oscar.
Admittedly, things did not always go smoothly. The most notorious production in the company’s history was the Terry Giliam film, The Adventures of Baron Munchausen (1988). No sooner had it gone into production at Cinécittà studios in Rome than it fell disastrously behind schedule. FFI stepped in to take over the production, but it was too late to prevent a film that had been budgeted at $23 million from costing twice that amount. Nevertheless, the company survived the setback to become a major presence in Hollywood and international film-making. With Slumdog Millionaire (2008), it recently guaranteed yet another production that would go on to win the ‘Best Film’ Oscar. In the early-1990s, the ownership of the company was transferred to the US, so that today Film Finances, Inc, is the parent company of Film Finances Ltd as well as a handful of other subsidiaries around the world. Today, that streak continues with the Company providing guarantees for numerous Oscar nominated films over the past 10 years, with 4 Best picture winners.
Apart from our own colorful history, FFI had been able to accumulate a treasure-trove of production materials over the past sixty years. By closely monitoring the progress of each film for which it provides a guarantee, FFI requires copies of the key production documents − script, budget, cross-plot, schedule, daily progress reports and weekly cost sheets. These provide the basis of a huge archive relating to over 3,000 films, including many of the great classics of English-language cinema: John Huston’s African Queen (1951) or The Man Who Would be King (1975), Michael Powell’s Peeping Tom (1960), Joseph Losey’s The Servant (1963), Accident (1967) or The Go-Between (1970).
