Over the course of almost a half-century of doing business in the fields of filmmaking, animation and motion picture technology development, A.I.A. Productions maintains the identical standards, ideals and commitment to integrity and excellence with which we began.

In an age driven by the bottom line, A.I.A. remains driven by the fundamentals of good and faithful business practices with an emphasis on the success of our clients and our investors.

These are the tenets of our business practices:

• We maintain only one set of "books";
• We tolerate no dishonest or unethical business practices, nor tolerate any divergence from the goals we commit to achieving;
• We make full disclosure to our Investors, regardless of impact upon the finances of our Company;
• We do not co-mingle funds between projects nor conceal any actions that affect the funds or success of our Investors;
• We never go into any production unprepared, or for any reason, enter into a project unable to complete its objectives for internal reasons under our control;
• We promise only what we are absolutely sure we can reasonably expect to deliver;
• We deliver everything we promise;
• We deliver more than what we are paid for;
• We keep our clients fully informed of progress and make every effort to achieve their creative and marketing goals;
• We do not over charge and bill only for the actual services provided;
• We only commit Investor funds to projects that maintain a reasonable probability of profitability;
• We keep our Investors fully informed of progress and make every effort to achieve their financial goals;
• We will, whenever possible, utilize the investor's own accountant for complete transparency and accountability of expenditures;
• We complete every project regardless of unexpected complexities at our own cost;
• We continually maintain the high industry standards in our production capabilities and our technical expertise;
• We always get the job done, above and beyond expectations;
• We always maintain satisfied Clients and Investors from whom we may use as references for the consideration of potential Clients and Investors in order to continue providing exceptional services and business ventures into the future.

These basic tenets are the reason why we are one of the longest surviving, independent filmmaking and animation production companies in the United States today. Many Industry sales agents over the years have claimed to possess higher business acumen by bending the rules here and there to make us more financially successful but we have never strayed from our Founder's ideals of treating Clients and Investors like family. Almost half of a century later, the companies represented by those sales agents are long gone but our business remains with a legacy of satisfied Clients and Investors from NASA and the Smithsonian Institution to PepsiCo and the New York State Fraternal Order Of Police.

To understand why we value doing everything the right way over immediate profit, just read Napoleon Hill's "Law Of Success" and you will know the full scope of our motivation. Of that book, George Eastman, founder of Kodak Film Corporation, said, "I would not care to set a monetary value on this training because it brings to the student qualities which cannot be measured by money alone."

Honesty, integrity, capability and delivering completed projects of exceptional value are our business.

 

A: The answer to that question is no.

The reason for this is that the Security and Exchange Commission forbids public offerings of stock or investment that are not registered with that agency. That prohibition includes online solicitation.

Limited liability partnerships for motion picture projects generally do not establish themselves as a corporation with public stock offering authority because the process is both time intensive and cost prohibitive for low-budget filmmaking.

Nevertheless, there is no prohibition to the solicitation of friends, family and acquaintances as investors. That means anyone you have become acquainted with may invest into a commercial project without restriction besides the "sophisticated investor" qualification.

This is why the reputation of your company is often what determines the likelihood of raising capital, should you become acquainted with a venture capitalist or qualified sophisticated investor.

 

A: Someone very familiar with the business in which they invest.

A sophisticated investor is not your elderly neighbor who knows nothing about the film industry. If she invests and loses her money, she may contend that she deserves her money back and may probably prevail in court to make you liable for returning her money - because her only source of information was from you. All she needs to prevail is to prove you did not fully disclose the true nature of the investment and you may find yourself completely liable regardless of any waiver or fine print you may have had her sign.

A sophisticated investor is an investor with experience in the industry of such a quality that they would be independently aware of the actual nature of the investment. The difference between your elderly neighbor and a sophisticated investor is that the former would be buying into something she had no way of reasonably determining the risk she had accepted, while the sophisticated investor is taking responsibility for making a cognizant decision.

This is why we limit Investor participation to only individuals and groups of individuals who are capable of making a cognizant decision to invest. This is also why we make full disclosure up front as well as during production through completion.

If you wish to invest in any of our projects, you will need to first be acquainted with us and our work, coming to a full understanding of the sobering realities of the entertainment market before discussing any capital investment.

There are Local and Federal restrictions for accepting investment and at no time do we consider circumventing, bending or otherwise not complying fully with the laws in place to protect both the Investor and our Company.

 

A: Yes, we write contracts.

We insist upon making legal covenants for all services and investment agreements because they serve as both work orders, outlining the full scope of everyone's responsibilities, as well as eliminating confusion and avoiding encroachment into assumptions made by either party so both remain satisfied with the results of every contracted undertaking.

Without a commitment to deliver, the paper itself has little worth outside of a court without the intent of both parties to fulfill a contract. This is why we only enter into equitable agreements that we are sure can be fully honored by both parties. No one wants to end in court so we make sure we have a workable contract that both parties are content and comfortable with before consummating these types of agreements. Our rule of thumb is to keep it simple, clearly defined, and reasonable.

This is why we have never had any Client or Investor take us to court or arbitration in nearly fifty years. This is also why our commitment to excellence has paid off in great references.

 

 

A: Federal law prohibits the making of speculative claims of profitability.

While that law makes raising capital a lot more difficult, Federal laws are fantastic because they are designed to offer minimal protection to the public. An ethical business both complies with the law and then goes beyond the minimal protection and adds its own higher standards.

Our commercial projects are designed to be both profitable and reasonably attainable under scrutiny. If a project cannot meet that criteria, we would not waste our time when we could be working toward something that would equitably benefit both our Company and our Investors.

We are permitted to offer comparisons with similar commercial projects, with the caveat of noting the specific industry advantages the comparison enjoyed. All too often, we see proposals where filmmaker X expects to achieve similar results to filmmaker Z without noting the caveats that make such comparisons deceptive by omission. This is very misleading to the Investor accepting information in good faith that it is true and sound when it is not.

In the low-budget filmmaking market, the area in which we do business, profits tend to be nonexistent without a major advantage over a cacophony of competing products. Profitability remains dependent upon maintaining both a substantial marketing edge as well as a wide margin between price point and production cost.

Currently, low-budget films from micro-productions sell (in totality of perpetual rights) anywhere from $35,000 US Dollars to just under a million, depending upon the market rights ceded. Today, there are almost 10,000 films produced annually worldwide. Only a few of those ever make it to the shelves of Blockbuster Video. Even fewer make it to theater screens which are generally pre-sold to the big studios, leaving independent, low-budget feature films dependent upon home video sales and cable broadcast.

The more production costs rise over $50,000 US Dollars, the narrower the actual buying market becomes. That means investing half a million dollars into a low-budget feature length film from someone who does not have a current audience that has already purchased and enjoyed the previous product has less than one hundredth of one percent chance of making back any profit at all. Forget the success stories of indie movies that made millions, the distributors made that money, not the investors.

Investors make their money from the Limited Liability Partnership that produced the movie. Whatever advance money the LLP got up front is often the only "profit" they realized. Once an Investor realizes that the Distributor is another Investor in a chain of Investors, the sooner they will grasp the bigger picture of the distribution and exhibition chain.

So how does an Investor make a profit, accepting such a risk with so much to go wrong? The same way every other business operates - by maintaining a margin.

If you already know that home video distributors are liable for "buy-backs" of unsold goods from retailers and cannot offer more of an advance payment for an unpromoted product than $100,000 US Dollars, then make sure you can offer a first-rate product that only cost $50,000 US Dollars to manufacture. Additional markets, such as cable broadcast, can also push the margin up significantly but you cannot depend on ancillary markets.

Ultimately, the best judges of what is and isn't a good movie investment are not critics, experts or gurus - it's you. Just walk through a video store and browse the aisles. What jumps off the shelf in your eyes? Arnold Swarzenegger on the box art or a cool graphic with no big name stars? Products resembling the latter may not have actually made the Investors a dime because when a movie doesn't sell, it is often given away for free to a distributor in a "hail mary" play for the possibility that it might be a hit if exposed to the public.

If the Investors and LLP maintained a reasonable margin and kept production costs low, then a profit has the opportunity to materialize over time as it is sold to the ancillary markets.

These are the hard realities that our projects are designed to effectively compete within.

 

A: You must first be personally acquainted with a principal of A.I.A. Productions.

Feel free to contact us because we are always making inroads into related industries as well as becoming acquainted with sophisticated investors primarily in the State of Arizona with long time contacts in Los Angeles and in New York City, where we first opened our doors.

 

A: Via telephone or email.

Gabriele Andres is a principal responsible for business development and is involved with all areas of our business. You may contact her at either:

telephone: 520.982.0520 Arizona Time Zone

email: gabi@jamesarnett.com

Navigate www.jamesarnett.com Home Page Motion Pictures VFX Visual Effect Services Production Services CineMatrix Filmmaking Software Guide Book For Guerrilla Filmmakers Cine Camera Engineering Web Design & Animation Executive Summary Tucson Film & New Media District Public / Investor Relations Site Search Secure Login Email Server