Sofa Digital announces investment fund manager for the Latin American audiovisual market

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In its first virtual event to the market, the Digital Sofa, a data and audiovisual content aggregator, presented its new business, the Sofa Capital, a smart investment fund manager.

On the occasion, five new national productions of the company that will be launched in the coming months were also presented: Luccas Neto at: Hotel Mágico 2, already in December, and Time to Shine!, with Sophia Valverde, Alice in the Country of the Internet, with Lorena Queiroz, Intergalactic Camp, with Ronaldo Souza – youtuber and creator of the channel Galactic Cat, and family shack, with Protasium Cocoa and great cast, in 2022.

After a year of record growth, Sofa wants to expand its support to film distributors in Latin America, investing in productions with cinema potential and Premium VOD. To this end, the company implemented a business model based on financing the creative chain, structuring a proprietary fund manager, which offers capital to finance projects, acquisitions, distribution costs (P&A) and prepayment of platform receivables.

The project strengthens the company's business model, which seeks dynamism in negotiations, variety and volume in its catalogues. In the last twelve months, the company financed the production of eight Brazilian films, four already released, and co-acquired several foreign titles such as Druk (Another Round), winner of the 2021 Oscar for Best International Feature Film, in partnership with Vitrine Filmes. The title debuted simultaneously in theaters and in Premium VOD.

For 2022, Sofa plans to expand this number, moving even closer to cinema and local distributors. With shorter windows, the combination of cinema and TVOD [Transactional Video on demand – streaming purchase and rental model] revenues will be the key to the financial return of independent films.

“A large-scale release strategy on TVOD is essential to increase the value of a movie in all other windows”, explains João Worcman, Chief Content Officer of Sofa Digital. “It's no longer possible to guarantee successful acquisitions and launches without a data-driven strategy and solid audience design,” he adds.

Sofa Digital's business model

Another fundamental pillar of the company's strategy is the Filmelier website, a powerful tool that helps the audience on their journey through the universe of films and platforms. Through data generated by users and added to the performance of films released in VOD, Sofa Digital is able to identify different groups of consumers, refining their acquisitions and creating intelligent marketing campaigns for the releases. The portal grew by over 700% in the last year and currently attracts over 3 million unique users per month.

The company's acquisitions arm is the seal Synapse Distribution, a brand inherited after the merger with Synapse in 2019, which focuses on movies for TVOD as a first window and with high potential for transactions. With theaters closed for most of 2020 and 2021 and the influx of titles from partners dwindling, the company went to market and made direct acquisitions to maintain the active and healthy release flow. During this period, Synapse acquired more than 100 films, of which 82 have already been released.

“We have already licensed 50% of all the titles that we release on TVOD for an SVOD or Pay TV”, says João Worcman, Chief Content Officer of Sofa Digital. “In Q3 of this year, seven of our distributed titles made it to the TOP 10 most watched on Netflix in Latin America. Only two of these films were by American producers, the other five being from Brazil, Holland, Lithuania and Australia”.

To support the new strategy, Sofa's team has doubled in size over the past two years and has a team of 62 people working remotely. Two executives from major North American studios have also joined the organization: Martha Cavalheiro, former vice president of Latin America Marketing at Twentieth Century Fox; and Andrea Dourado, former Marketing Director at Sony Pictures Brasil.

“We have a complete, specialized and engaged team, and we are prepared to be the main link between the independent film industry and platforms”, says Fabio Lima, founder and CEO of Sofa Digital.

The Digital Sofa in 2022

In the coming year, the company, leader in the TVOD market in Latin America, and one of the main aggregators of Subscription Video On Demand platforms, SVOD, in the region, should further diversify its business through new content exploration models such as that of advertising, Ad-Supported Video On Demand (AVOD).

In the signature space of add-ons, Sofa Digital manages a SVOD channel, Pure Adrenaline, the result of a joint venture with California Films. The channel was launched last year and is available in Latin America through Apple TV, Amazon and Claro NOW. The platform brings together titles of action, horror, suspense, with big movie stars, and is aimed at an adult male audience.

Sofa Digital is also expanding its business to AVOD, having already licensed hundreds of hours of content across all major platforms. on the front line of Free Ad-supported Streaming TV (FAST), the company has two main initiatives: a channel with content from the main children's IP in Brazil, Turma da Mônica; and Adrenalina Freezone, with dubbed action-horror productions that is also a result of the merger of Sofa Digital and California Filmes.

“The pandemic brought challenges and changed many things in our industry. We are confident in our thinking that data, technology and working very closely in collaboration with our partners are the main tools we have for making films reach people”, he concludes. Fabio Lima.

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