Interviewer (3:59)

Yeah, those are some pretty long nights. So who are the investors you talked about? I want to break out a bit of what you talked about like actually funding these movies. 10, 15, 20 million dollar price tags. Is this private equity? Is this high net worth individuals?

Jordan Harmon (4:14)

Yeah, so it's a combination of either private equity individuals. We have a film fund called the Angel Acceleration Group that helps finance some of them as well. And so it's going to be a combination of all that creative financing. But the core principle is that don't producers do not pad their pockets with their Production budgets. They pad their pockets with their profits. And so the beauty of that is I've had producers come in and pitch me a TV show. And they're like, man, this TV show is amazing. Here's the plot. I'm like, that sounds great. How much is it going to cost? Like, well, I probably could do it for like 35, $40 million. I'm like, okay. And then we walk through our entire business model and we get to the end, and if they really understand, I've had people in the exact same meeting go, you know what? I think I could shoot this for $11 million. And I'm like, wow, that's amazing. You just went from 30 something million dollars to 11 million dollars. That's the beauty of incentive alignment, is it changes to where you now have a business. That again, I always tell people, Hollywood does not. The entertainment industry does not have a revenue problem. They generate hundreds of billions of dollars. They have a spending problem.

John David (5:24)

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Interviewer (5:58)

Yeah. If you see the free cash flow of like a discovery or any of these businesses, I mean, there's a lot of money, there's a lot of debt in some cases, and there's a lot, as you said, of frivolous spending, but there's plenty of money coming in. Can you talk a bit more also about the Guild? So the Angel Guild, I think I understand it, but like, where did it come from and what exactly is it a revenue generator? Is it really a community engagement tool? Like what, what is it exactly? Yes, all the above.

Jordan Harmon (6:29)

So the Guild, if you've ever read the book the Wisdom of Crowds, it speaks to the power of creating a proper sandbox and then allowing communities and crowds to actually make decisions and that the aggregate can oftentimes, if given the proper sandbox, can make better decisions than any expert. You know, one of the examples they give in the book is who Wants to be a Millionaire? You know, there's the three lifelines back in the day, and it was Phone a friend or an expert. 50 50. Or ask the audience. Well, if you phone a friend or an expert, they were right 61% of the time. If you ask the audience, they were right 91% of the time. And so the beauty of this is we are basically creating an environment where anybody can go join the Guild. You can go to angel.com guild and join anytime you want. And when you join the guild as a member, you're able to go watch the next Sound of Freedom before it ever is known. And you can go vote on whether you think it's a meaningful project on your phone, on your tv. And you're actually going to get to peek behind the curtain of something that's either in development or just finishing production or whatever it may be. You get this peek behind to actually influence what comes to Angel Studios. And the beauty of this is we can really pretty closely predict what our audience score is going to be. We actually did some data collection this last this week on our audience scores comparing with the A24s, Paramount, Disney, HBO, you name it. We have the highest audience score average on our titles by a wide margin. The NE Ours is 94% audience score on Rotten Tomatoes. The next best is paramount at 84. And so the reason for that is because we're not guessing. We know what the audience wants. We already have the data. We understand what they're going to resonate with, and we do that from the early stages of development. So, like, we'll have someone, instead of submitting a script, they create a torch, which is like a proof of concept, a short film, a prototype, and they submit that 5, 10 minutes of actual footage that they shot and produced to the guild. And the guild goes, yes, I want this made into a TV show or a film or no, this is not great. And we go from the early stages before investing millions of dollars in resources and time to actually go and make sure that the audience is resonating with the core idea. And then we do it again at the end to make sure that they honed in on the message that they got it right, that the story arcs are done right. So that's. The Guild is not only, you know, a membership that helps fund the future of angel content and films and TV shows. They get two free tickets to every angel theatrical release. They get discounts on on Merch, and they get early access to our content. But most importantly, they get a vote and decide what comes.

Interviewer (9:05)

That's so smart. You have this minimum viable product version of in. In. In this industry, like you're basically asking people if they would buy a ticket, if they would see it, if they would watch it before you ever spend a dollar or much money at all on the project. So you're never going to make something if people say no. You know that long before you filmed one scene.

Jordan Harmon (9:25)

And it makes us a very creator friendly, producer friendly studio in that. One of the things we pride ourselves on is we don't take any creative control over our producing partners. None. We tell them in our agreement the only person you're responsible to is the Angel Guild. If you win them over, angel will support you. And so we don't have to go in and try to take final cut or different type of creative control to manipulate how it's supposed to be. Now we collaborate with them and say, hey, this might score better if you do XYZ or do this or that. But the beauty of it is, is they know how they're scoring when they go to the guild and they're just iterating and trying to figure out how to get that product right. I remember having a director come in on their first cut and they submitted the film. They said, it's done. And I said, well, let's see what the guild says. And it didn't pass. And he was like, man, he's like, I didn't realize you'd be so off. And he had to go through over a dozen cuts to get the film right. But when he did, the audience loved it and it's been awesome.

Interviewer (10:18)

And how do you market movies these days? I mean, you do it for a lot cheaper. Are you buying billboards? Are you doing PR campaign? Like, how do you actually get the word out for a movie in 2024?

Jordan Harmon (10:29)

Yeah, I mean, obviously the, the real intricacies of our marketing I can't go over in a podcast. But the reality is, is it's just taking the principles of our background and direct consumer marketing. You know, if you look at, you know, I started a company called Cove, which was a DI. Is a DIY home security company that we built into $100 million company. And then my brother started a company called Harmon Brothers which did like the squatty potty commercial and poo pourri. And. And so we have this background in direct response marketing. And so it was, it's really taking those principles and just translating them over to the entertainment space. And so it's not crazy complicated. It's just discipline, hard work and trial and error through, you know, significant AB testing. But the traditional studios don't operate that way. You know, they got a $50 million budget. They're going to go spend $50 million and 70% of that's going to be on billboards and they'll see on opening day if it's stuck. That's just not a good model.

Interviewer (11:21)

Yeah, the minute you said D2C, you had me. When you come from that world of rigorous marketing where every dollar has to make a dollar or has to make a buck fifty, it's a whole different psychology from let's put up billboards on, you know, Ventura Boulevard and see if people, you know, that's right, show up at the movies.

John David (11:39)

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