Independent film production, financing, and sales company XYZ Films, based in L.A., knows genre fare better than most, “elevated genre” that is.
Founded in 2008 by Aram Tertzakian, Nate Bolotin, and Nick Spicer, it has made a name for itself with its focus on such international genre movies as Gareth Evans‘ cult classic The Raid and Panos Cosmatos’ Mandy, starring Nicolas Cage.
The Toronto International Film Festival (TIFF) has long been a key market for XYZ. This year, the world premiere of its sci-fi romance Daniela Forever, starring Henry Golding (Crazy Rich Asians) and Beatrice Grannò (The White Lotus season 2), is opening TIFF’s Platform competition.
Ahead of Toronto, XYZ Films chief operating officer (COO) Maxime Cottray, who was promoted to that role last year, talked to THR‘s Georg Szalai about how Spanish filmmaker Nacho Vigalondo‘s new movie ticks all the boxes, the current buyer’s market, how the company looks to attract an audience beyond core genre fans, and why XYZ is betting on filmmaker-driven projects.
How key is TIFF for XYZ?
We joke about how TIFF is our home market. It’s been great for us because we are a North American company, but we also have a very strong international focus. It’s been our home away from home for a long time.
What is interesting about TIFF as a market is that it’s at a bit of a crossroads. TIFF has always been and continues to be super strong for domestic, both in terms of sales but also as a great place to release films because it leads into the autumn release schedules. For international, it is at a bit of a crossroads, simply because who knows what’s going on with AFM in Vegas. And in Europe, most people go away on holiday in August, and school starts at the beginning of September in most European countries, so it’s always been in a funny place timing-wise.
How does the timing of TIFF fit XYZ’s new title, Daniela Forever, which had its world premiere at Toronto and focuses on a man who enrolls in a clinical trial for a drug that allows him to reunite with his lost lover through lucid dreams? And how does this movie from director Nacho Vigalondo (Colossal) fit into the focus and evolution of XYZ?
For Daniela Forever, we could not have asked for anything better. This is exactly what we wanted. To give you an idea of where that film sits in our universe: XYZ is traditionally known as the elevated genre company. Our big four genres have historically been action, sci-fi, thriller, and horror, but we also do a lot of things that are adjacent to that.
Daniela Forever fits into this for three perfect reasons. Number one is, we have always been driven more by filmmakers than anything else. And Nacho is an incredible filmmaker and someone we’ve been following for a long time. We have personally known him for a while, so we have just been dying to do a movie with him. Number two was, I would consider this film a sci-fi romance. The romance part isn’t necessarily XYZ, but the sci-fi thing is. It’s like: if XYZ was to do a romance film, it’s this movie. And so that’s why it just felt, despite it having this romance element, very natural for us. And third, it also fits our model. What we have been doing over the last couple of years is we have developed into a full-fledged independent studio.
We started as a production company. We spent the better part of 15 years doing sales. But then, we raised financing in 2019, so we are also financing movies. And we are distributing movies now. Daniela Forever fits into this exact model where we are looking to fully finance movies that we are selling the world on. It’s a Spanish movie, so it worked in the European funding system. It’s this perfect model where we fully finance something in conjunction with a European funding model. In this case, it was the ICAA (the Film and Audiovisual Arts Institute) in Spain, and there’s the Spanish tax credit. It’s about these fully financed independent filmmaker-driven movies that are in the genre zone.
Of course, there is another part of it also that helped package it, the cast. Henry Golding has got an established name thanks to Crazy Rich Asians. He’s big. But then you also had Beatrice who was in the last season of The White Lotus. She’s up-and-coming and we feel has this upside potential, because she was so great in the show and we loved her. It’s this combination of an established cast member and somebody we think is going to be “the future.”
So, this movie just had all these ingredients where the whole thing just perfectly fit together, and it turned out to be amazing. And TIFF is the cherry on top if you will.
Since the film ticks so many boxes, can you talk a bit about how you and your colleagues at XYZ think about potentially getting genre fare a broader, maybe even a mainstream, audience?
Being global is in and of itself part of our DNA. Just look at the very first films we made, such as The Raid in Indonesia in 2011 [that won the Midnight Madness Award at Toronto that year]. It’s been such a part of our DNA forever. And where this gels with genre is this: there’s extreme genre, which is naturally niche. But in a world where we are competing with studio movies and giant Netflix stuff, genre movies that are, as I’d say, not too extreme niche, are one of the major ways to still attract audiences. Because in the independent space, as we all know, straight dramas are super hard. Also, things that aren’t necessarily cast-driven are hard. Casting is the hardest thing in the world these days.
Genre gives us the medium that we are comfortable in and gives us a base audience, but then it allows us to tell exciting stories through the means of this. One of the things we really look for is genre with a meaning behind it. So it’s not just a slasher for the sake of doing a slasher. It’s more a way to still reach an independent audience and giving them some of these genre beats that they are looking for.
On your point about the global nature of it all. The genres we work in travel the most. The best way to explain it is to explain what doesn’t work. Comedy isn’t a good example. Comedy is hard. Comedy is so culturally specific.
Playing to our DNA, the story of Daniela Forever in and of itself is incredibly universal. It’s about loss, and about dealing with the pain of losing a loved one, and how do you process it? It couldn’t be more universal. But then we’re using the sci-fi element to bring in a sci-fi audience that would normally not be naturally interested in romance. But the sci-fi element eases that audience in. Which is how can you use technology in an interesting way?
The XYZ brand seems to have a built-in audience or fan base. To what degree do you try to activate that via social media or other tools and then how do you try to go beyond that?
We do always look at two things. We look at our core audience, and we look at how do we get the audience around that too. We know we can reach our core audience if it’s just something that we naturally gravitate towards because we in and of ourselves are our own audience too. Nacho is a filmmaker who swims in the XYZ audience world. When you look at his previous films, like Colossal, that’s exactly the kind of movie that we would love to have done. And the XYZ audience is very aware of Nacho. We have such a tight relationship with these audience members. On the outlets we use to reach out to them, Instagram and these kinds of platforms, we are always and constantly in dialog with them. So when they see something like this, which they don’t know anything about yet, we are very confident they’ll be super excited. This is like: “Hey, I want to watch a date night movie with my girlfriend, but it’s still an XYZ movie. It’s like the best of both worlds.”
As far as the other audience goes, that’s the exciting bit. We are not usually in the romance space, but I think this will be our way into that audience too. I think we’ll actually open up a whole different audience,, certainly a different audience to the one that watches The Raid or Mandy. That’s important for us as part of our development. That’s part of the growth. The challenge is how do you preserve your core audience while adding to it.
You mentioned distribution earlier. XYZ films have been Netflix originals, you have had deals with studios. How important is U.S. distribution still and what is XYZ’s approach to distributing itself since you launched a U.S. distribution arm a few years ago?
The U.S. is, especially in our zone, still the lead market and the one that the world follows for, especially the kinds of movies we make. And so, it’s a huge part for us. In fact, it was the first part of our business –domestic sales has been there for XYZ since day one, and it is one of our biggest departments. We have done deals with every single company in the U.S. multiple times. Every bit of what we do is maintaining that relationship, not to mention we distribute ourselves in the U.S. as well. Whether it’s us selling or U.S. distributing, it is still the focal point of every release for obvious reasons. In terms of demographics, the U.S. is just the largest market for our kinds of movies.
Because we have done deals with everyone, when we make a movie, we know who this is going to appeal to. That’s so much part of it, especially as we finance these movies. We finance them in partnership with IPR.VC, so it’s our financial responsibility when we make these bets on movies. It’s not only about knowing who the audience is, but we also want to know who the buyers are. That is part of our analysis when we go into it. On Daniela Forever, we put up quite a bit of money but we are obviously confident in it. We know this movie will appeal to a lot of people.
What other projects is XYZ bringing to TIFF?
There’s always the catalog. And every movie usually has its run at three, four markets, so stuff that was on the Cannes slate is at TIFF. But the Daniela Forever premiere is the main focus. We are also showing some sneak peek footage from a martial arts movie called The Furious from [producer] Bill Kong, which is extremely exciting. It is totally different from Daniela Forever. But again, it is a perfect example of something that is very, very XYZ.
The dual Hollywood strikes had an impact across the industry. With its more global focus, what was the effect on XYZ?
It had an effect on everything U.S.-based. But equally, so much of what we do is international that it didn’t really have that big of an impact if I’m quite honest. It affected a few specific U.S.-based projects. But Daniela Forever was shot in Spain with a British actor and an Italian actress, so it wasn’t affected by the strikes. We have always prided ourselves on having a very diversified business. Europe, Canada, Australia, New Zealand have always been huge focus points for us. So we kept busy, we did a lot of European movies, and a few Aussie and Kiwi ones.
Of course, the strikes affected everyone. There was the direct effect, say, on a production but then there was also the macro effect. It affected the buyers and the streamers, and therefore it affected the pay-TV deals. So there is a trickle-down effect from it. In that sense, we are the same boat as everyone else, but during the strike, we continued to make movies.
In 2023, XYZ launched its New Visions label to put a spotlight on bold new filmmaking voices and established talent looking to do smaller, more challenging projects. Are you looking for further labels or other extensions?
No, right now, we are very comfortable with our core business and New Visions, which has a specific mandate. To be honest, we love playing in our core. And the beautiful thing about it is, tied to your earlier question, is that we can reach the core audience and also look for the outer audience, so it gives us quite a lot of flexibility.
Are there any film financing and funding trends worth highlighting?
The international market in particular is still very cost driven. Our mitigation of risk is working in the genres that people know us for. There’s that fine line where you want the familiar genre, but you want the content to be unfamiliar to be different. So that’s the balance you have to play.
The trickle-down effect of the streamers having their issues over the last two years has meant that the so-called pay-one window, the streaming part of the revenue stream, which has historically always been the most important has been less consistent. This means that buyers are less reliant on this, so they are naturally a little bit more risk-averse. So it means a lot of working directly with buyers to say, “What do you guys want?” so that we do less of a guessing game. It’s about finding this equilibrium between great content we want to make, but also making sure it’s something that people want. It sounds like that’s probably always been the case, but I think it’s become more acute. It’s definitely a buyer’s market. That’s clear.
Any other thoughts on the state of XYZ or its future?
I think we found our sweet spot in terms of the genres we work in. And we are betting on filmmakers. Daniela Forever is just the perfect example of this because Nacho had such a great track record. He’s so talented, and this was such a great script. The film just had all these ingredients.
