Asia feasts on funds

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A credit crunch may be slowing private equity flowing into U.S. and European media, but in cash-rich Asia, credit is a smaller issue and film funds have not yet lost their flash.

From the $285 million plunked down for 21 pictures over six years for a new Asian film fund by the Weinstein Co. to the $7 million earmarked for making movies for the China market by Singapore director Jack Neo, film funds of all sizes are still popping up.

Billions in private money are coming into China's broader media and entertainment sector. Projects from companies whose products -- from video games to piracy-proof digital distribution solutions -- show promise are getting two to three times what they might have drawn in funding three years ago.

"Internet investment is down. Film may be the thing over the next five years," said one Beijing-based venture capitalist whose company policy keeps him from being identified. "It's too competitive, so we keep quiet."

A mix of money is out there, some fresh from the pockets of moguls whose fortunes were minted in other industries.

JA Media in Beijing announced at Cannes it would put $200 million of its founders' money (made in corn-based ethanol fuel) into a slate of movies and TV shows over the next five years, backing a roster of Hong Kong directors making movies for China.

Other money comes with more sector experience, with term sheets up front and complex bonds demanded. IDG's $200 million Asian New Media private equity fund, managed from Beijing by Hugo Shong, will no doubt go head-to-head for the hottest projects with the Weinstein's fund, managed by David Lee (Shong's former vp).

Lee commutes between Los Angeles and Beijing and already has a feather in his new VC cap. He is credited with pulling together the money (with Relativity Media and Casey Silver) behind "The Forbidden Kingdom," a modern-day fantasy based on Chinese lore that brought together Jackie Chan and Jet Li for the first time.

Another Hollywood-Beijing commuter is Peter Shiao, whose shingle, Ironpond, is circling the market in partnership with backer Endgame of Los Angeles, hitting film festivals in Hong Kong, Shanghai and Pusan this year talking about their plans for production and financing of movies in the next five years.
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