The boxing drama "Southpaw" released over the weekend has a seemingly unlikely partner in its corner: Chinese conglomerate Dalian Wanda Corp.
Wanda financed the approximately $30 million production budget for the Jake Gyllenhaal movie. It was produced and is being released by Weinstein Co., which is paying for about $35 million of marketing expenses. The two companies will split any profits.
"They were on the set and involved in production, postproduction, marketing, everything," said Weinstein President David Glasser. "They wanted to learn how we do what we do."
In exchange, Weinstein is hoping Wanda will help the movie gain a favorable distribution arrangement in China.
"Southpaw" represents one of several ways Chinese companies lately have been trying to tap Hollywood moviemaking know-how.
Four former heads of major studios and studio divisions have in the past year launched or taken jobs atop startups backed by Chinese investors.
They are launching amid a wave of Chinese investment in the entertainment business, technology and other U.S. industries. The Chinese companies aren't only looking to make money, people involved in the moves say, but to gain expertise in areas where they are currently not global leaders.
"China is the fastest-growing movie marketplace in the world and the source of a tremendous amount of capital," said Sheri Jeffrey, a partner at law firm Hogan Lovells who focuses on entertainment finance.
The wave of startup studios is unprecedented in recent Hollywood history and a sign of how much more accessible funding has become for a very risky proposition.
"Many traditional sources of investment dollars are looking for a faster turnaround of their money," said Dick Cook. He has spent the past five years putting together a plan for his own entertainment venture and looking for investors. It took five months of talks, he said, to land a recently announced $150 million investment from Chinese conglomerate Citic Guoan Group Co. Ltd.
China gets its own benefit from the deals: the advice of some of Hollywood’s most experienced hands at a time when its government is pushing entertainment as a source of "soft power."
Though it has become the world’s second-largest movie market, China has yet to produce a globally popular movie of the type regularly churned out by Hollywood. Allying with former studio chiefs is seen as a tool to change that.
Hollywood is far from the only American industry benefiting from Chinese investment. Silicon Valley has also seen an influx of money from across the Pacific, with Chinese e-commerce giant Alibaba Group Holding Ltd. investing $200 million in Snapchat Inc.
Still, the stream of capital comes at an opportune time, some believe, because major studios are making half as many movies as they did a decade ago, leaving holes in the market.
Chinese companies have been investing in established Hollywood enterprises for several years.
Though "Southpaw" is the first American movie in which it invested, Wanda acquired AMC Entertainment Holdings Inc., the second-largest theater chain in the U.S., in 2012 for $2.75 billion. Lions Gate Entertainment Corp. in March closed a film financing deal with Hunan TV & Broadcast Intermediary Co. worth up to $375 million.