By Victoria Powell 10-02-2017
It’s a good time to be a small indie. Despite the consolidation of the last 10 years, small indies are still driving some of the most original and innovative programming on our screens.
The numbers say it all, as smaller indies are attracting a staggering £704m (US$881m) of UK commissioning spend each year, or 43% of the total. In a market where experimentation rates are very high – with about 1,500 new shows per year in the UK – this is a significant and solid base for our vibrant and diverse UK TV ecology.
But despite that, it is plain to see that more needs to be done to support our small indies in their growth. There is a real need for more investment in the lower part of the sector, in the small sub-£5m-revenue firms. It’s at this stage of their growth that indies often stall, unable to cross the bridge between one-off commissions and returnable, sustainable work.
Growth as an indie is brought about by a number of factors, such as talent, timing and sometimes more intangible things, like the movement of commissioning editors. However, it remains true, and increasingly so, that small indies find growth and sustainability illusive without external investment to help them improve operations and increase development spend. Investment can help them build and scale their businesses, boosting production activity and accessing new international markets.
Two years ago, I spoke to the mayor of London’s office about this problem and they backed our Indielab programme to help drive more investment and growth into the sector.
Twenty-four months on, the early signs are good. There are many new investors and investor groups coming into the market, as well as a number that are looking to invest in TV for the first time. Others from the sector, who understand that indies are looking for investment without strings and still want to hold on to their rights, are forming more attractive new investment vehicles.
So what does this mean for indies?
How you prepare for these new opportunities is critical, of course. The most important question is the simplest one but often the hardest to answer: where do you want to be in three years? This really is the question that underpins everything else, including how much investment you need and, vitally, how attractive you might be to investors.
Once you figure this out you can start to weigh up your options. It is critical to do your homework and know what you are getting into. Being investment-ready also involves getting your house in order. Knowing where all your rights contracts are, sorting out your employment contracts and any incentive schemes are just a few items that should be on the check list for businesses looking to become investment-ready.
Once everything is in place, you can start to think about meeting investors. Preparation is key, as is thinking carefully about the type of investor and the individuals you will eventually be working with.
Speaking to previous investees and establishing the track record of the investor is just as important as proving your own. It goes without saying that all investors will want your revenues and profits to grow, but it is important to think about what they will bring to the table and add to your business beyond just money.
Will they provide support in developing your business model? Will they help identify ways to maximise revenue streams? How involved are they really going to be in your business and in helping to get you to the next phase of growth?
At the end of the day it’s a partnership, so think carefully and be sure you partner with people you can work well with – through thick and thin.