← Making It with Jon Davids
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This clip of Making it with Jon Davids features John talking to Jordan Harmon, president and co founder of Angel Studios.
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I've been to all of the Hollywood, lots of all the big studios and all I can say is when the chauffeurs have executive assistants, you know there's excess cash. You know there's excess cash flowing around, man, because that's what it's like. You walk in, you're like, I don't understand what these, what does this room of people do? And there's just no good explanation. And I think your right, it's. You come from a world where you're just getting fat off of fees. And I don't even know where the fees go. They just give, they get dividended out. And then, you know, you come from my world, which is like the scrappy startup world. And it's like, guys, we have $100,000 to do everything like that. No one gets a fee. We get profit at the end of the day if there's a profit.
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And yeah, in the startup world, it's like I don't even get a salary. We're just. You're just living off of top Ramen for like 12 months.
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Exactly, exactly. So, so you. I've been in the game I think since 2016. Right.
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And so 2012, 13 was when we actually started the company. Okay, four brothers and a cousin. And it was originally called VidAngel. And the idea was to build an audience large enough that we could then launch into original content. And so we built that company and it was excelling. And then we got a fat lawsuit from Disney, Warner Brothers, 20th Century Fox. And the premise of that company was we wanted to give parents a technology that allowed them to skip and mute anything that they found objectionable inside of content, films and TV shows. And the studios didn't love that. And so when we got sued, we ended up pivoting to our original plan, which was to build up a large audience and then do original content. But we had to pivot to it earlier than we were expecting. And 2016 was when we made that pivot to original content to actually go and solve the studio business. So that's when the studio started the official studio. But from 2013, when we originally started the company, this was kind of the end goal.
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And was your path in because you guys have a very specific niche today and you're super successful. Was your path in coming in from the we want to build a faith based company or we want to just have an alternative. And it just so happens that faith Is the alternative like, or was it purely entrepreneurial where it's just like we want to find an industry and break it and rebuild it. What was your actual motivation?
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Yeah, so if you've read the Innovator's Dilemma, there's these beautiful principles around disruption where you go and serve these underserved markets in really meaningful ways. And, and so for us, there's there in the entertainment space. The entertainment space has done a really good job of creating this false dichotomy around faith based content as a niche product, when in reality, 95% of the world is faith leaning. And so when you think about that in that context, 95% of stories should have some element of faith in them. What we wanted to do is we wanted to create the same quality of storytelling that everybody else was doing, but do it with the values that represented what we felt was good for the world and for our families. We all have kids and so that's kind of the framework that we were looking at it in. And it wasn't like we're going to go make a faith studio. And we don't even consider ourselves a quote unquote faith studio. We'd say we're, we're an American independent studio who happens to be faith friendly. And we allow that type of content to absolutely. We want it to live on our environment. And we believe that if you let the audience guide you, you will have 95% of your stories have elements of faith integrated into them. But unlike a lot of faith based studios that have kind of done a really poor job of cheesy storytelling, we want to do it extremely compelling. And two, we, we don't want it to be in your face. Right. Just like a lot of people have been rejecting Hollywood with the propaganda that they're shoving into their stories. The same goes for, you know, faith or Christian type content where you get someone that's more of a sermon and less of an entertainment movie. And so that, that was, you know, really important to us is to make sure that this was on par with anything that the mainstream entertainment studios were doing. The large, the large studios. But it wasn't really a goal of faith based. Our mission is to tell stories that amplify light, which is a much more broad term in terms of how we position the content.
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It was actually the number one search film and it was in the top ten for domestic releases. But for the summer, yeah, it was definitely up there. It took on a life of its own. For sure.
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It did. And just so people know, I mean, people will probably know if you don't just search up Sound of Freedom. I believe it's like number four or three on all time independent films. I don't know if you have that stat, but that's what I'm just looking up on the numbers. So can you talk a bit about the background kind of how that came to be and how and when you guys got involved?
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So that's an interesting story. There's a lot that goes into that story. So do you want the short version or the.
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Give me the short version and we'll pick it apart.
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Yeah, yeah. So basically we had launched a theatrical division with his only son, which was a film about Abraham and Isaac in 2013, the spring of 2013. And leading up to that film, we had known about the Sound of Freedom movie for a long time. But as far as we were concerned, Warner Brothers had originally greenlit it. We knew that Disney bought it and something had happened with that, but it apparently had gotten shelved. And then the producers finally got it out of Disney and we're trying to find a path to distribution. And so we connected with them. I want to say March of 2023. And basically angel has a very unique process and I'm actually going to step just one more step back so that you can understand why we would even go and bark on this, because that was a heavy film. Like I said earlier, we wanted to create an incentive structure that solves for the Hollywood issue. And so we've removed all distribution fees, all the ad overhead fees. We have an incentive structure where we don't make any margin on distributing and marketing the project. We make margin when we both win together with our producing Partners. The reason we can do that and we can make that bet is we have what's called the Angel Guild. So we've built what's called the Angel Guild, which is a community of over 360,000 people and growing very rapidly of our super super fans. These are members, this community. A lot of are paying annual in monthly memberships at 20 bucks a month. And so these people are really, really die hard fans. But they are more than just the people who help us fund the content and fund what we're doing. They actually help us pick what we distribute and get out into the world as a studio. And so every film and TV show before it ever can go onto the Angel Studios platform or that we ever release theatrically, has to first get greenlit by the Angel Guild, the community. Now we take a random sampling and we get to statistical significance and there's a lot of nuance there in terms of our formula. But the beautiful part about that is, is we know that the audience already loves the product. We're not guessing. We know what they love. And so we can remove all those fees like the other studios have and just focus on getting to the worrying about the last dollar. And it allows for the producers to go, well, I know with Angel, I'm actually going to get a back end if there is one. I mean, if we win, we'll win together. And so I'm going to keep all my production fees really tight so that when I produce a $10 million movie, it looks like a $50 million movie. Or when I produce a $5 million film, it looks like a $25 million film or a 50, you know. And so with Sound of Freedom, they submit it. We asked them to submit to the Guild, they submitted to the Guild. And the guild went, this is off the charts. Like, they just loved it. And so everybody's like, should we distributed this? It's child sex trafficking. No one wants to watch a movie about that. That's a crazy idea. But for us, it was a no brainer. The Guild said they wanted it. We have built a business model on base hits. And what I mean by that is we haven't built a business model on trying to find the next Sound of Freedom. That's actually not our goal at all. Our goal is to have consistent base hits where we spend meticulously and measurably our marketing dollars, our P and A to release these theatrical films. And then between the theatrical release and the Angel Guild and Angel app and our licensing partners and all the 10 year ultimate is what they call it of the revenue for a project. We can make lots of. Prof. From it. But if we have a breakout hit, we also have the infrastructure to go scale into it. But we don't. It doesn't matter if we do or not. So we lo. We go and we decide, let's go take this out. And within five days, we had gotten a distribution agreement with Sound of Freedom Team. And to be honest, that if anybody knows this industry, five days to lock in a worldwide rights distribution deal is absolutely a miracle. There's just no. I don't know if I'll ever see that again. Like, I just. It's. It's remarkable. And so. And then it was a question, a function of, like, selecting a date. And we're. First, we were thinking October, September. And we had some members of the team who felt strongly that we should go earlier. And some of them had even really meaningful experiences around. Like, we feel like we should go earlier. And. And so we started dabbling around with the idea of July 4th. And we had consultants and people who were like, we're out. You guys go, July 4th. We're out. Like, that's. That is. You're going there to die. All the big studios pay hundreds of millions of dollars, really billions of dollars across all of them to go for those July dates and June dates. And so they just said, we're not going to be a part of that. But we felt strongly that we had a movement that we could rally behind July 4th, you know, with it being Independence Day and trying to get independence for these children who are being trafficked around the world. And so we went for it. And within three months, we put together. Less than three months, we put together an entire campaign around this film. And it just took on a life of its own and did over a quarter billion in the box office, which, you know, again, we're not building our model for that. We couldn't care less if angel has another Sound of Freedom because we have a sustainable business model for base hits. The World Series is won by base hits. It's not won by home runs.
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Thanks for listening. Get my best stuff to your inbox at johndavid. Com. We'll talk to you next time.