[Chapter 66: Brand Placent and Sponsorships, The Linton Charity Foundation]
After persistent efforts, the brand placent sponsorship team secured a deal with Brown, a high-end Arican fashion brand, willing to sponsor all the costus the female lead would wear in the film. Even the stage performance costus could be designed exclusively by a renowned designer. However, Brown tied their sponsorship fee to the North Arican box office performance.
"Looks like they still don't have confidence in us. Isn't this basically a wager? What are the exact conditions?"
"Brown is willing to sponsor $500,000 worth of clothes for the movie Step Up. If the North Arican box office is under $30 million, Brown won't pay extra sponsorship fees. If the box office lands between $30 million and $60 million, Brown will sponsor an additional $500,000. And if it exceeds $60 million, Brown will add another $500,000, totaling $1 million."
Linton considered it. Since this project featured all fresh faces, the sponsor's hesitation was understandable. Also, the tiered structure seed reasonable.
"Alright, let's go with that plan. Also, can we add a tier? If the North Arican box office surpasses $80 million, can we ask for another $500,000 increase in sponsorship?"
Robert and the others exchanged looks; $80 million North Arican box office? That was ambitious. In their minds, $20 million in North Arica plus international box office and rchandise would already be profitable for a movie with new talent. $30 million was considered very successful, and $50 million was a fantasy. Linton's request for $80 million completely rewrote their expectations.
"Let's give it a shot. What if we make it?" Linton said when they were stunned into silence.
"Alright, we'll discuss this plan with Brown. Pepsi is also interested and proposed a similar deal."
"What are their conditions?"
"For Step Up, Pepsi requests no fewer than three product placents. Pepsi provides a basic sponsorship fee of $200,000. If the North Arican box office is below $20 million, no extra sponsorship is paid. Between $20 million and $40 million, Pepsi adds $300,000. Between $40 million and $60 million, Pepsi adds $500,000. Beyond $60 million, an extra $500,000 is added, totaling $1.5 million."
"That sounds good. Let's stick to this plan. Also, negotiate if they can add a tier for over $80 million box office with another $500,000 increase."
"They should agree, Pepsi usually is flexible on such matters."
"What about the fast-food chains I ntioned earlier? Didn't they show any interest?"
"We approached Burger King, KFC, McDonald's, but they declined. They said your character's role, as per the story, likely involves receiving welfare, and they don't want to attract attention from social service investigations or cause trouble."
"How about movie rchandise for Step Up?"
They knew in Hollywood, rchandise sales were a vital inco source, sotis exceeding box office revenue.
"We discussed thoroughly. Besides the original soundtrack, only two t-shirt styles and caps worn by the male lead in the movie can be rchandised. The soundtrack contract has been signed with Universal Music for production and distribution. The t-shirts and caps have production suppliers lined up. According to our agreent with Universal, rchandise will be sold in Universal stores."
Upon further reflection, it seed there wasn't much else in the film to turn into rchandise.
"Tim, are Universal Studios' facilities ready? The crew is about to move in."
"All ready. Tomorrow, the crew can move in, including dance studios, makeup rooms, conference rooms, production offices, everything is fully equipped. We've also reserved enough hotel rooms at the Universal hotel for the principal staff starting tomorrow."
...
After the eting, Linton stayed behind with Robert, Mira, and Goodman. He signed his contracts as director, lead actor, and screenwriter. The director's fee was $200,000, lead actor $300,000, and screenwriter $50,000 (the other two writers' fees were personally covered by Linton), totaling $550,000 - a bargain for sure.
He told Robert Naomi's fee must not exceed $200,000.
---
After Robert and Goodman left, Mira brought good news to Linton.
Armani suits and Tix watches promotional ads were ready. She took out two videotapes from her bag and played them.
Both ads included print ads and videos. Linton carefully watched and found them excellent -- perfectly showcasing his charm and fully integrating the products' image.
"Well done. Since both endorsents passed their audits, I'm fine with them. Let's go with these two."
"Also, they want to hold a press conference soon with a comrcial promotion event. They asked for a specific date."
"Arrange it. Let's aim to finish by late February. Also, coordinate to have the venue in Los Angeles if possible."
---
That evening, back at the estate, Henry Zhou was waiting. After dinner, the two went to the study.
"Boss, the Linton Charity Foundation is set up as you requested!" Henry said, opening his briefcase to hand Linton a thick file.
"Thank you, much appreciated," Linton reviewed and was very satisfied.
"No need to be polite, boss, it's my duty. How much do you plan to invest in the foundation this ti?"
"Universal reported $91 million in revenue. After paying the final copyright fees for The Lord of the Rings and The Hobbit totaling $3.5 million, investing $7.4 million in Linton Studio movies, I still have over $80 million left. Two advertising sponsorships totaling $12.6 million are coming in soon, but I'll be paying $1.5 million for charity activities, so let's invest $85 million directly."
"That's a lot for the foundation; one person can't manage it all," Henry said. "I recomnd hiring a professional investnt assistant to handle the investnts and ensure steady growth.
Also, per U.S. private foundation regulations, we must spend at least 5% of net assets yearly on charity. If we want good outcos, I suggest recruiting soone dedicated to managing expenditures."
Henry had already earned more from Linton in six months than he ever dread. He had handed off other clients to colleagues, focusing entirely on serving Linton. However, he knew he couldn't manage such huge funds alone and assud Linton wouldn't entrust both accounting and investnts to him.
"We'll hire investnt and charity spending staff later. For now, invest the money in stocks. Microsoft is my first choice."
"Boss, Microsoft's market cap has surged from under $700 million at IPO in 1986 to over $18 billion in just over five years, a 25-fold increase. Investing heavily now carries risks. Also, buying in the public market with your huge funds will drive prices up, making it inefficient," Henry advised.
"Makes sense. So, contact Bill Gates's family office. He owns over 44% of Microsoft stocks. Now that prices are so high, they might want to sell shares. See if they'd consider transferring so to ."
Linton rembered a joke about Bill Gates setting up his family office with top investors who optimized the portfolio by reducing Microsoft shares and diversifying. Though this reduced risk, it also converted Gates from a trillionaire to a billionaire, dropping him from the richest to lower ranks, even though Microsoft's market cap exceeded $3 trillion.
"You don't have to buy all the Microsoft stock. That would be too risky," Henry insisted.
"No, I'm investing in Microsoft only. See what you can do. If possible, I want to acquire $100 million in shares."
Linton thought Microsoft's market cap was only $18 billion now; by 1999 it would surpass $560 billion with 30 tis potential growth. Selling then would yield huge profits. But no one would believe that now.
"We don't have that much cash," Henry protested.
"I can mortgage my existing real estate and stocks, right?"
"Your estate and Silicon Valley office are already mortgaged, no further loans possible, but stocks can be. You invested $41 million in the stock market in three batches into four stocks, all performing well. Now worth over $50 million, a $35 million loan should be feasible."
"That solves the problem. Contact Bill Gates's family office ASAP."
"Alright, I'll head to Seattle to inquire," Henry said reluctantly.
"Don't just ask, make this happen. I believe in Microsoft's future. If you close this deal, I'll reward you $100,000."
Linton offered the hefty incentive to ensure Henry's full commitnt.
"Got it. I'll make sure it's done," Henry affird and left.
*****
spatreon/Sayonara816.
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