The investment panel at Rio2C

RIO2C: Executives from the worlds of audiovisual creativity and corporate finance met in Rio de Janeiro this week to discuss the need to strengthen the connections between the two sectors as the traditional sources of production finance dry up.

The chasm between the audiovisual world, with its intricate mechanisms for managing creativity, and the financial world, which tends to be more corporate and structured, must be bridged, producers and investors told delegates at the Rio2C conference in Brazil yesterday.

The issue of marrying the corporate and the creative has been a recurring theme at the Rio de Janeiro event, as producers, streamers and execs from the finance world explored the issues of the day and future trends in an audiovisual industry beset with challenges.

Laura Rossi

“It’s not that private investment in audiovisual doesn’t exist in Brazil, it’s that it’s not done in a structured way. We need to better understand the risks of the sector,” said Laura Rossi, director of audiovisual investments at the São Paulo-based private investment fund MUV Capital.

“For example, who can explain to me when Netflix pays back the investment I made in a production?” she asked.

MUV Capital is a Brazilian investment fund that connects the financial market with the creative industry, particularly in music and film. One of its key areas of focus is offering investors the opportunity to participate in audiovisual productions through its parent asset management company, Hurst Capital.

Earlier this month, for instance, MUV teamed up with Brazilian distribution company Retrato Filmes to jointly invest in the latter’s slate of films. Retrato was launched by Felipe Lopes, former director of distribution at Brazil’s Vitrine Filmes, and Daniel Pech, whose credits include Prison in the Andes and Too Late to Die Young.

Rossi, formerly head of international at Brazilian prodco Gullane Entertainment, explained that in 2025, the company is looking to invest in projects that already have at least 50% of their funding secured across production, post-production and distribution.

“That part must already be resolved by the producer. We’ve chosen not to enter at the development stage, and our preference is for a last-money contribution of 10% to 20%, mainly through private equity,” she said.

Gustavo Mello

Also speaking at Rio2C, Gustavo Mello, partner at São Paulo-based production company Boutique Films, emphasised that gap financing is harder to obtain in Brazil than in other markets.

“Gap financing, which is commonly used internationally to close production budgets, is very difficult to secure here in Brazil. The streaming boom has led to production costs in Brazil equalling those in Spain, which puts financing pressure on producers,” he noted.

In this process, the Rio2c participants agreed on the need for financial intermediaries who can act as mediators between the creative and finance worlds, as the former begins to rely on the latter as more traditional sources of production funding dry up.

One emerging player in Brazil is ethical banking, which may have closer ties to the cultural world and offer tools to help forge such partnerships. Fernando Figueiredo, commercial director of Banca Ética Latinoamericana (Belat) in Brazil, was at Rio2c to explain.

“On one hand, we provide guidance on the formal and legal aspects of productions to ensure all documentation is in order. On the other hand, we conduct integrated analysis, assessing financial risks while also measuring the cultural impact of the project,” he said.

Figueiredo said Belat “structures credit and investment operations with a focus on positive impact.” The company acts in the connection between capital and transformative businesses, “offering financial solutions that enable projects with economic, social and environmental sustainability,” he added.

Belat and MUV jointly created a guide for attracting private funding for audiovisual productions, which they presented during the event. The guide tries to demystify the issue of private investment in the audiovisual sector by focusing on finance options aside from private equity.

Fernando Figueiredo

The first of these is a finance model based on obtaining credit from future payment flows anticipated in already signed contracts. This model enables immediate liquidity for production stages without the need to wait for the actual receipt of those amounts.

Production companies that have contracts with funding sources – whether through sponsorship, public or private financing, or licensing agreements with TV channels, streaming platforms, or distributors – can use these instruments as guarantees to structure operations. This strategy expands access to capital and allows for greater predictability and control over the production schedule.

Another alternative to private equity is investment in exchange for revenue participation. This form of investment consists of the allocation of private funds directly into the production or distribution of audiovisual works, in exchange for a share of future returns, such as profits, commercial exploitation revenues and licensing rights.

In this model, the private investor has the right to the priority recovery of the amount invested, along with a percentage share of the work’s revenues, as negotiated at the time of the agreement. It is a shared-risk relationship in which the investor bets on the work’s potential return and becomes a partner in the project, aligning their interests with those of the producer. This type of arrangement is common in projects with strong commercial appeal and structured financial planning.