"Television is a great business option because there is only one strong set up- Balaji Telefilms" : Parag Sanghavi - K Sera Sera Managing Director

Looks can be deceptive...take for instance, the just-over-a-year old media company- K Sera Sera's managing director Parag Sanghavi. Although Sanghavi looks like a pucca Delhi babu, he is anything but that.

A business management graduate, Sanghavi has been in the entertainment industry for more than 15 years and is better known for his association with filmmaker Ram Gopal Varma. The association that started off with the Varma productions Company and Road, still continues strong. So much so that you can be pardoned for thinking that K Sera Sera is a sister concern of RGV production. Although both offices are housed in the same "Factory", they are just business associates, maintains Sanghavi.

As managing director, Sanghavi has been involved in conceptualising, developing, designing and nurturing the media company. With seven movies on the floor for the year and couple of others in the pipeline, the company is all ready to roll out the next phase- the television production division.

Excerpts from an interview Sanghvi gave to's Trupti Ghag:

How, why and when was K Sera Sera launched? How did the journey begin for you?

While I was working with Ramu (Hindi film director Ram Gopal Varma) on Company and Road, I realised that due to lack of planning and discipline, both movies went completely out of budget. If a movie was to be made within Rs 10 crore (Rs 100 million), the budget soared up to Rs 15 crore (Rs 150 million). I definitely saw a huge opportunity in the media space, which is when we, Ash Pamani and me, decided to launch a new media company.

We took over a listed company Garnet Paper along with a few non resident Indians based in Hong Kong and USA and established K Sera Sera in November 2002. After establishing the company, we decided to do some pre production homework. One of the major observations was that it was pre production that caused the delay.

In order to ensure that no particular movie gets delayed unnecessarily, we have established certain systems. We have a final action plan aka a master file and till it is locked, we don't get into the execution stage. The master file is a bound script complete with the timeline and the locations, which is duly signed and approved by all the technicians and actors concerned. Once that is in place, we move on to the execution stage. Whatever calls we have to take, we take them prior to the execution stage. At the execution stage, it becomes more like an assembly line; it is no more a creative process.

Usually, it so happens that during the execution stage people keep making changes and that is when the budgets go haywire and the films take two to three years to make. Any good film shouldn't take more than 65 or 70 days to shoot.

We started off with Darna Mana Hai, immediately followed by Ek Hasina Thi and the latest movie slotted for release is Ab Tak Chhappan, besides which we have five more films on the floor. We have been able to achieve this primarily because the pre production homework is so strong that everything is taken care of.

Was that the original plan when you started off?

When we started, we thought we would do about four films per year. But looking at our output, we have upped it to seven to eight movies for a 2004-5 release.

We are currently working on Murder at Srikrishna Bulding, Naach, Gayaab, James, Time Machine, the sequel of Darna Mana Hai…. Darna Jaroori Hai and Vaastu Shastra

What is the arrangement that you have with Ram Gopal Varma Corporation?

Simple, Mr Varma looks at the creative side and we handle the production. Of course creative is a two way discussion and we are present during the brainstoming sessions. As for the revenue, we have a 50-50 share model, but then again it depends on the movie and our involvement with it.

What happened to the two movies that you announced in 2003 along with 'Darna Mana Hai' and 'Ab Tak Chappan'?

We are still working on Nimmi; it is in the conceptual stage and we are yet to finalise both script and star cast. While Chala Vinod Tiwari Film Banane is still on the back burner, we don't think it is a workable proposition.

How did you raise revenue for the venture? What does your core team comprise of? What about the technicians?

When the company started, the directors and the associates invested INR 120 million in the company. While 65 per cent of the equity is held by directors, friends and relatives, rest is held by the public.

We have a board of directors consisting chairman Ash Pamani, executive director Azam Khan and me. We have a chief production administrator who looks after the complete production. All the executive producers and technicians report to him. Then we have a head of finance, account, distribution, overseas distribution and their teams. The current employee strength is around 200 people including around 175 people on a subcontract basis.

Is the tilt towards the thriller genre a calculated move? Or is it because making thrillers are a more economical proposition?

No, I don't think that we want to limit ourselves to just thrillers. We have a development department, which consists of scriptwriters who throw up ideas. So we kept listening to scripts and ones that we thought were pretty exciting were made into movies. We operate like a factory; we have seven to eight releases lined up and will be hiking it to 11-12 next year so we need the thinking and ideating quickly.

Also I would like to point out that not each one of them is a thriller. Naach is a musical film and Gaayab is a film about an invisible man, while James is a hard core commercial film starring new comer Mohit Alawat.

Plus, it is a myth that thrillers are more economical. I think that they are more expensive than romantic movies. The post production cost is astronomical.

"Any good film shouldn't take more than 65 or 70 days to shoot"

Recently you announced that you would be making television content as well? So how is K Sera Sera being structured now?

In 2004, we will be generating looking at 75-80 per cent of our revenue through movies and 20 per cent will be through television. We have signed on quite a number of producers for the television venture, including Ravi Rai, Clapstem's Girish Mallik and DJ Creative's Tony Singh.

While in 2005, we are looking at 50:50 ratio.

But why the sudden interest in television software?

Business, what else! Television is definitely sound money. Movie making, as everybody knows, has huge upside but there is a huge risk involved. So we are going to strike a balance by taking some risk (making movies) and ensuring regular revenue via television software. You can't ignore television anymore. It has a huge market and with likes of the Karishma's and the Malini Iyer's coming in, even the production values have risen.

So what is your opinion about the current television scenario?

It is a great business opportunity because there is only one strong set up and that is Balaji Telefilms. Rest I believe are moving in different directions. They have too much varied matter on their plate.

Television has loads of talent and plus there are so many different channels, and therefore regular demand for television software. We are going to position ourselves amongst the top three players. With our ability to scale up the movie production, we obviously will be able to deliver three to four times more. Couple of channels have already shown some interest in our ventures.

Since one has seen your style in movies, it seems like you will have to do a mind shift while creating content for television?

I don't think we will tow the line. Personally, I think television is willing to experiment. Did any one believe that Kaun Banega Crorepati would work?

Since the concept of dailies has grown and the demand for them is high, we will be churning out dailies. We would be looking at a thriller or a high school drama. Something for standard ninth and tenth, boarding school tales... we have a concept Life at St Andrews, which we will be pitching to the channels.

Actually we are yet to focus on television, but we have ideas. We should be ready with seven- eight pilots within next six months.

Although a high school drama seems interesting, how do you suppose it will go with the regular couch potato?

According to me, if the content is good, it will work. We are optimistic. Plus, I think it is a genre that is not well exploited. You could be surprised!

What is the status on the Sahara telefilms?

We just handled the production. For both movies, Thakaan and Bewadadas, we were given the story and the actors. We just worked backwards.

"Television is definitely sound money"

Coming back to movie making, what kind of thought process goes into making a movie?

When we zero down on an idea, we get into development phase that includes scouting locations, signing on technicians and actors. Once that is done, the master file is collated and a tentative budget put in place. Then we take a call whether it is viable or not. If it is, then we go ahead with it. If it is not, then we restructure. If films costs are so expensive that we can't recover, we drop it.

Can't you still go ahead and rope in some in-film promotion to raise the moolah?

I don't think that the phenomenon is as prevalent in India. Plus, we are definitely not going to adopt changes in the film to suit the products. But if it suits the screenplay, then why not?

What is the current status on 'Ek'?

Ek is a minimum 50 million dollar film and is still in pre production stage.

Are you looking into movie distribution?

Yes. We feel that distribution is not as transparent in this country and that is one of the reasons why movies suffer. It is either the distribution or piracy that have cost the movie business dear.

We are still in the process of setting up the network. Ab Tak Chhappan is the first movie that we are going to distribute in Mumbai and Delhi-UP. While we have tied up with a company for Delhi- UP distribution, we have set up an office in Mumbai. We are eventually going to set up operations all over India and globally.

What is the current distribution set up in India?

It is a highly disorganized business and plus it is not transparent. According to me, to maximize revenues any production house will eventually have to distribute.

Do you see a future in digital distribution?

Digital is still in a nascent stage. It will be an additional revenue but the print distribution will not stop. What the producer can opt for is make both prints for prime centres and release the movie digitally in the outskirts. One good thing, it will help counter piracy as the movies will reach all the centres.

"It is either the distribution or piracy that have cost movie business dear"

Incidentally is there any formula for success. Looking at the industry pattern, it seems that either big budget movies succeed or small budget movie recover their cost. Or is it that publicity is the key to success?

I don't think that there is such a formula. I have seen Rs two crore (20 million) movies failing to recover even their production cost and 20 crore (200 million) films losing 20 crore.

Ultimately, it is the content that drives the box office. We can control our production cost, make it a high quality product and stick to the deadline, yet we need strong content to back it.

But yes, I will agree that publicity is key to a movie's success. If any movie has to get into theatres, its television promos have to work.

Ideally, any movie would need a minimum promotion budget of Rs 1.5 crore (15 million).

What are movies that you are co-producing with Radaan?

We will be picking up the Hindi movie concept that we think will be viable in the Tamil market. Then we will produce the film with their artistes and technicians. Radaan will supervise the complete production.

The first movie that we plan to make is Time Machine. It is a movie that requires elaborate sets and expensive post production. So ideally, if we shoot it in two or three different languages, the effective costs per movie would be less.

More often than not, such concepts have failed to work. How sure are you about its success?

I agree. There is not a great history but there are certain stories that have universal appeal. Like for example, we won't adapt Ab Tak Chappan, which is about police encounter, but stories like Murder at Srikrishna Building about a man who kills his wife is going to appeal universally (laughs).

We are in fact planning to make it in Telugu too.

"If any movie has to get into theaters, its television promos have to work"

Is there anyway where by you can insure your revenue?

I can insure the movies against the production casualties including actor problems but unfortunately we cannot assure the revenue. It is done in Hollywood though.

So how did the movie industry look at you when you started out? Was there any hostility?

No! Not at all. In fact, they loved the corporate structure and everybody was happy with it. In this industry, people often keep talking about numbers but they don't deliver. We needed a Hollywood kind of structure. Since we are a listed company, all our dealings have been through cheques and people welcomed it.

So you weren't greeted with "yet another corporate body joins the bandwagon"?

Nah! Personally, I think the trend of corporate bodies getting into filmmaking is very good for the industry. It introduces a lot of discipline. But what corporate bodies have to understand is that this industry is still a personalized business. A lot of things can be achieved by merging the two: a) discipline and b) relationship management.

Contrary to popular perception, even the actors are liking the discipline. We hear a lot of horror stories about them, but we don't know the other side of it.

You have recently raised your authorized share capital from Rs 1.5 billion to Rs 2.5 billion. Where do you propose to use that extra Rs 1 billion?

We have just raised the authorized capital, but we have not issued the capital. We have just made a provision in case we plan a preferential issue or a public offering in the near future.

It is just a statutory thing. Companies always keep the authorized capital little higher as a procedural matter.

What about event management? Weren't you planning to expand into this are?

Not really, but we will be looking into star management. We have that plan for 2005 end we will be looking at a joint revenue sharing model with the stars.

How has last year been in terms of revenue? What are the learnings?

Since the financial year officially ends on 31 March 2004, we can only offer approximate figures. Our turnover is Rs 25-30 crore (250-300 million); about Rs five crore (50 million) profit.

We have been improving every day, we have successfully tried to cut costs wherever it is possible and it is turning out to be more and more lucrative.

Also if you look at content, I think Vaastushastra will be the scariest movie ever. Plus we will be also looking at the Hollywood market.

What exactly do you mean by Hollywood market? Are you making movies for Hollywood or looking at just distributing the movies?

We are looking at Hollywood market to distribute Indian films. But we are very clear that we are not going to change our screenplay for the revenue it may fetch us from overseas.

I think the Indian film industry has just started out. There is a huge overseas opportunity. India has content, just that it's not marketed well. Producers do not look at overseas avenues; they just look at a few territories.

What overseas markets are you talking about? Is it just UK?

No. I think Indian movies have the potential. Look at Bend it like Beckham, Monsoon Wedding, Chalte Chalte or Koi Mil Gaya... they did a great business overseas. If Chinese movies sell, I think we have quite a big chance. Except that we haven't yet positioned ourselves.

But it's either the Diaspora movies or musical extravangzas that work well with the NRIs. Your kind of movies are westernised, why will the western market even look at the inspired versions?

You got a point there but I am quite bullish that it is content that excites viewers. If you give them good content, they will watch.

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