First of all, ACG is not AGC. Please correct me.
The Ministry of Finance and the State Administration of Taxation recently jointly issued a notice to reduce or reduce various taxes such as value-added tax in the development of the animation industry.
"The promotion of policy reform will inevitably affect the financing environment of animation companies." Liu Hui, executive director of Shanghai Mantangtang Cultural Communication Co., Ltd., said that the animation industry's attraction to venture capital is heating up. But he also admitted that almost all domestic original animation companies face financing difficulties.
Therefore, many original animation companies are trying to make innovative attempts at financing the animation industry.
On July 31, the Ministry of Finance and the State Administration of Taxation jointly issued a notice to reduce or exempt value-added tax, corporate income tax, business tax, import tariffs and import-link value-added tax in the development of the animation industry. In this regard, Zhu Jianmin, director of the National Animation and Game Industry (Shanghai) Revitalization Base Office, told reporters that the state will implement support for the animation industry in the form of "first taking small steps, then big steps" in terms of policy, which will benefit the animation industry in the long run. Speaking is undoubtedly beneficial.
As for the reason why preferential treatment is implemented in taxation, many animation company operators believe that the state is aware of the "anemia" problem of animation companies from the industrial level, so they hope to guide it from the perspective of "reducing expenditures" . Although its coverage in the industrial chain is limited, and for many entrepreneurial companies in the initial stage, they cannot achieve revenue in the short term and will not receive benefits, but this is a signal-"meaning that the country is The support of the animation industry is slowly opening up," a business owner who operates animation derivative products told reporters.
According to Liu Hui, executive director of Shanghai Mantangtang Cultural Communication Co., Ltd. (hereinafter referred to as "Mantangtang"), they used to go around looking for VCs, but now things have changed, and he often has to deal with VCs within a week. Various investors held 3 or 4 meetings to discuss equity or project financing issues. The animation industry is becoming increasingly attractive to venture capital.
As one of the largest comic creation organizations in China, Mantang Tang has nearly ten years of experience in the animation industry. Especially in the field of comic creation, it has won the honors of "Top 50 New Enterprises" in the 2008 China Venture Capital Value List and the Key Support Team of the Ministry of Culture's Original Comic Support Plan. It has considerable reputation and status in the animation circle. But Liu Hui said frankly: "Being at the front end of the most forgotten comic creation industry, either the value is underestimated, or it is not favored by venture capital because of the risk of originality." Liu Hui concluded that almost all original creations in China are Financing problems for animation companies.
ACG integration:
Mutual benefit in the animation value chain
The so-called ACG is the abbreviation of Animation, Comic and Game in English. A general term for comics and games (especially electronic games). With the rapid rise of the video game industry, in Japan, these three industries have been closely integrated in the 1990s, and many works are planned across the three platforms in order to achieve maximum benefits.
According to the survey results of the Japan External Trade Organization, Japan’s domestic animation-related market size has exceeded 2 trillion yen. Zero2IPO data also shows that Japan has become the animation country with the largest output in the world through the commercial combination of cartoons, cartoon books and video games. 65% of the world market and 80% of European animation products come from Japan. The animation industry accounts for more than 10% of Japan's GDP, becoming Japan's third largest industry.
In China, the animation, comics, and game industries almost all operate independently, and there are almost no large-scale enterprises that operate across the three platforms. Mantangtang launched China's first animation and game inter-industry cooperation project, realizing the comic, animation and peripheralization of the popular online game "Fantasy Westward Journey".
Liu Hui calls Mantangtang’s core model “commercial cartoons”, which means “taking story content as the core, starting from commercial needs, through good images and stories, and using comics, animations and games as the core. Expression form, disseminate, attract and guide young consumers, thereby achieving the effect of disseminating products and services.
"In Japan and South Korea, this kind of mature market commercial animation comics is directly reflected in the "ACG model", and "Fantasy Westward Journey" is the most vivid domestic case.
It is reported that in NetEase's 2008 financial report, the Internet Games account for about 90% of revenue sources, and the biggest contributor is "Fantasy Westward Journey", which has 230 million registered users and set an industry record of 2.56 million simultaneous online users on August 2, according to investment banks. Oppenheimer predicts that NetEase will achieve revenue of at least US$120 million in the second quarter of this year, an increase of 5% year-on-year, mainly driven by the brand strength of "Fantasy Westward Journey" and "Westward Journey 2".
, Mantangtang, together with NetEase and joint publishers, jointly develop online game peripheral products including comics and animations. According to Liu Hui, the immaturity of peripheral products in the domestic online game market provides opportunities for cooperation with animation companies. It allows online game companies to see the space for value-added. “We have a mutually beneficial relationship with NetEase. Through more than three years of content creation, research and dissemination of game players, many teenagers who like animation and comics have reached out to them through the Internet, newspapers and periodicals. Through activities and other channels, everyone basically knows that "Fantasy Westward Journey" has a comic book, and this influence will be further strengthened with the launch of our animation. "Liu Hui said.
In addition to moving from games to animated comics, a webgame (page game) of the same name, led by Mantangtang and adapted from the first well-known domestic comic "Zone 1 212", is also planned to be launched in October. It will be launched in March, and the stage play of the same name will be released by the end of the year. This is also an extension of the industry chain. As far as the ACG industry chain model is concerned, the industry scale and operating capabilities of animation are not enough to become the dominant model of ACG. Therefore, animation companies should not be too ambitious. They should not try to integrate all links in the industry chain. Instead, they should be "micro-champions", that is, they should be the best in market segments. Therefore, the best cooperation must be done. Share your best with other strong partners
According to Liu Hui, the cooperation with NetEase will not only create a new model of domestic commercial animation operated by a third party, but will also lead to Man Tang Tang. Possible annual income of tens of millions (twenty years of licensing income and subsequent product development value income) and priceless brand advantages. There are currently many follow-up similar commercial animation projects. This is the effect of sharing and cooperation.
Liu Hui jokingly said that Mantangtang is following the path of "sugar daddy, learning from big money, and becoming big money". Its partners in the industry chain also include NetEase, SMG, Youyang Media, and Jiangtong Animation. , Anhui Publishing Group, Liaoning Publishing Group and other strong partners. From this point of view, the core competitiveness of Mantangtang he emphasized is not only the advantage of original content, but also the ability of “integrated operations”. We don’t expect everything to be mine. We look forward to being able to integrate more peers to build a good project together and share achievements. ”
Project financing:
A model that is more in line with the reality of China’s animation industry
Regarding funds, Liu Hui’s view is: the shortcomings of the domestic animation industry are content, Capital and industrial chain. In terms of capital, he is more optimistic about project-based industrial capital than equity financing, whether it is the currently popular animated film "McDull" or the previous animated film "Pleasant Goat" that generated a box office of 100 million yuan. You can see the presence of industrial capital such as Shanghai Media Group (SMG) and Youyang Media.
Unlike equity financing, this type of industrial capital is more project-centered, flexible, and does not involve inter-company involvement. The complex relationship is more acceptable to investors and project parties. In countries with developed animation industries such as Japan and South Korea, this kind of "project financing" is often expressed as "cooperative filmmaking" - a good idea and script. Even a three- to five-minute demo clip can be used to negotiate investment with TV stations, toy manufacturers, and publishers. There are also such cases in the mainland. Today Animation used the clip of "Chinese Boy" to raise 4 million euros in investment from Europe.
Earlier, Mantangtang also experienced a conceptual change from "equity financing" to "project financing".
According to Liu Hui, “In the past, many companies came to us to talk and wanted to acquire our company, but they were all rejected. It’s not that we don’t want money, but the cultural differences between us and other issues have kept us away. On the contrary, the “Fantasy Westward Journey” project After the launch, many peers in the industry chain came to discuss cooperation with us, including the aforementioned Youyang Media, SMG, etc. I think it is not only the quality of the project itself, but also this simple cooperative relationship that everyone is looking forward to. "Liu Hui admitted that project financing may be the most suitable form of financing for the creative industry.
At the same time, project financing has also put forward higher requirements for the cultural and creative industry chain. Project financing requires a good management team and a mature industrial chain. "For the entire industry chain, my personal judgment is that firstly, a good project is more meaningful than a good company; secondly, project management tests a team more; thirdly, a good project is enough to support an excellent company." Speaking of excellence Liu Hui is particularly touched by the significance of the project to the industry and the company. "In the past, Mantang Tang Company only worked on million-level projects. The "Fantasy Westward Journey" project suddenly raised the company's level to tens of millions. Of course, starting from our During the operation, we also discovered many problems in ourselves and the industry, and many links in the industry chain require our joint efforts."
In this way, based on the "sugar daddy" business philosophy. , Mantangtang has attracted the attention of many investors including Fosun. But Liu Hui said that we are not in a hurry to make decisions, nor will we blindly cater to capital; because we have found a business model based on ACG that is not limited to games, so that comics at the forefront of the industry can have more diversified business cooperation space . "As for choosing investors, we now value not only the capital, but also the resources they can bring." He said with a smile, "If it were Fosun, we would be willing to give a discount."
But it is worth noting that there are not a few online game companies active in various animation industry investment and financing forums. At the "China Animation Industry Development Summit Forum and Investment and Financing Project Matchmaking Conference" held recently, investment managers from Shanda, Perfect World, and Giant expressed their interest in the animation industry. As far as powerful online game companies are concerned, equity investment in animation companies may be their preferred form.
An analyst from an online game company told this reporter that animation and online games are indeed two major industries that can complement each other and add value. Learning from ACG's development model is currently also a hot topic in China. However, if the company and project are valuable, equity investment is still the main form they consider. "With the animation industry's undetermined structure, equity investment can quickly supplement the original strength of the upstream of the online game industry; and we can now negotiate a good price," he said.