Decentralized Pictures Looks To Democratize Hollywood's Ideations With Blockchain
While at the Outer Edge LA 2023 Conference in Los Angeles, Blockchain Journal technical analyst Bob Reselman interviewed the co-founder and CEO of Decentralized Pictures, Leo Matchett. Decentralized Pictures was founded on the principle that blockchain can be used to democratize the process of creating and approving ideas (everything from scripts to talent choices) for TV shows and movies.
As opposed to testing piloting production ideas with small audiences, Decentralized Pictures makes it possible for Hollywood studios to test market ideas with larger audiences by using blockchain to financially incentivize reviewers via smart contract-managed compensation. Calling it the "opposite of crowdfunding," Matchett says studios can get a massive amount of feedback on audience resonation before making huge investments in production.
The system works for the financially incentivized reviewers as well because of how they're scored based on their review history. As a reviewer's score improves, so too might their opportunities to derive more income from the platform.
By Bob ReselmanPublished:April 3, 2023
Bob Reselman: Hi, I'm Bob Reselman with Blockchain Journal, and I'm coming to you from Outer Edge 2023, here at the Los Angeles Convention Center in Downtown Los Angeles, California. I'm here today with Leo Matchett, CEO and Founder of Decentralized Pictures. How [are] you doing today, Leo?
Leo Matchett: I'm good. Thank you so much for having me.
Reselman: Happy to have you here. So, tell us a bit about Decentralized Pictures.
Matchett: Thank you. Decentralized Pictures is a 501(c)(3) nonprofit to promote the cinematic arts. We are essentially curating content and discovering talent using Blockchain technology to incentivize the review process. In its simplest form, we're trying to quantify subjective things using the power of community and voting. The way it works is, we put out a call for entries for filmmakers who need financing for their films, or want to apply for an opportunity.
They submit their ideas, and they pay a fee into a smart contract. That fee actually gets dynamically distributed to anyone in the community that gives their opinions on the creative. So through that process, we can then mitigate our risk in investing in these films so that we can justify that there's a built-in audience, and we can actually break it down by demographic to see which audiences which content is striking a chord with.
Reselman: This sounds like it'd be really a good way to, like you say, mitigate risk at almost an industrial level. Why should I put a lot of money into something if there's no interest?
Matchett: Yeah, exactly. The methodology we're using can really be used for any subjective decision-making, whether it be designs on a concept car, or a VC trying to decide which startups to invest in. People can make their pitches, put their best foot forward, and incentivize a community of reviewers to give opinions on whether they think those are good ideas or not.
Reselman: We could also see this even scaling out into mergers and acquisitions. Really, should I buy this company? There are a lot of people involved with that. Or even more for the entertainment industry, even at [an] industrial scale, if we're talking to $100 million budget, greenlighting, that's a big deal. It seems like this will really help make the process a lot more efficient. Is that an accurate description?
Matchett: That's that is an accurate decision. One of the problems we're solving we call, in the film industry, the "drinking from a fire hose" problem. A lot of companies don't take unsolicited material. There's some liability in doing that. But also, the development departments can be relatively small, and the inflow of content can be too big for a department to review it all. So the way we do that is, we outsource it to the world and get mass amounts of feedback and data to help understand what the audiences are requesting, in terms of content.
A simple way to put it is, it's the opposite of a crowdfunding platform. [In] a crowdfunding platform, people are asking the world to give them money for their project, whatever it is, if it's a film or a startup of some kind. What we're doing is, we're asking the people that are wanting money for their projects to pay a relatively small fee into a pool so that a community can then be incentivized to give opinions on it. So you're actually asking the world if they like your project or not, and they get paid for telling you and giving you honest feedback.
There's a user reputation system built in so that people who are accurate, [and] give very compelling and honest reviews, those people could be upvoted by the community, and their track record over time is calculated so that their reviews, or their scoring, is actually weighted higher in the algorithm, so that someone who's very good at analyzing creative material has a little bit more say than someone who isn't as good, or is just beginning and may not have the track record or commercial success and experience that someone who's an industry professional would have.
Reselman: So it sounds like an additional benefit is, like you said, reverse crowdfunding, that I'm putting skin in the game, I'm putting some money out there, that I have enough faith in what I'm doing that I'm looking for [a] qualified response.
Matchett: That's exactly right. You have to believe in your project enough to be willing to make it eligible, and pay that fee into the contract. Really, everyone thinks their idea is great. We can only help so many people and finance so many films, so we need to determine who's most deserving of our support, not only for financing, but from our network. We were founded, in part, by American Zoetrope, the company that George Lucas and Francis Ford Coppola started in 1969.
That company was founded with the ethos that creatives should be driven really by [the] community, and be a little bit unhinged from the conventional models that sometimes go into decision-making around the greenlighting process for films at studios and in the conventional Hollywood system. And so, Decentralized Pictures is really an extension of that ethos, but using the power of blockchain technology to help us understand what audiences are asking for, and which filmmakers and creatives are striking a chord, again, with the audience. So really, we can do pre-money market testing on ideas at a mass scale.
Reselman: So it's informed decision-making. I'm liking your idea about, again, skin in the game. So if I'm somebody at a Fortune 500 company, and I'm a manager, and I'm given a budget of a $1 million to run my department, and my department's in R&D or something, even before I put it out there, I might have to be willing to sacrifice a part of my budget just to get into the decision process. That, again, skin in the game, which seems to be a real separator and motivator.
Matchett: Sure, yeah. It's a way to try to quantify subjective things. Absolutely, yeah.
Reselman: Great. That's very clever. I like that. I like that. Also, I've heard on the floor, because we're here at Outer Edge 2023, that you won an award at Cannes. Is that true?
Matchett: No, I didn't win an award at Cannes.
Matchett: That's not true. We attended Cannes last year at the Marché du Film, and launched our application to start taking submissions for films. I did actually win a technical Emmy Award for another smartphone application that I helped with, called Artemis Director's Viewfinder, maybe that's what you heard.
Reselman: The rumor mill down on the floor, everybody's got something to say about everybody. Hence, we need something like Distributed Ledger Technology, Blockchain, to make sure what we're saying is true. So, please excuse this mistake. But, I hope you win an award at Cannes. Anyway, thanks for coming by, Leo. I'm really excited about your enterprise. I think that decision-making and making informed, invested decision-making at the community level, and even broader at the corporate level, has some real potential.
Matchett: Yeah, absolutely. It's really about statistics. People do market testing and people do focus groups on certain creative decisions, and they can be costly and take a long time. I feel like what we're doing is, in a transparent, auditable, and immutable way, mitigating risk for our fund about which projects we invest into, and relying on the power of statistics to do it. It's about sample size. So if you do market testing with a group of 20 or 30 people, there may be some deviation from the mass market, based on where you pluck those people from. The types of people that participate in those things may actually skew your data as well.
So what we're doing is, we're trying to get as large of a sample size as we possibly can. To do that, we're incentivizing the participation. It's really incentivized behavior. So if you want to make some extra money in your free time, and you enjoy being a film critic, please join our community and start reviewing people's projects, and help them get their films off the ground. Again, I feel like this methodology could be applied to many different industries in the same way.
Reselman: Great. Just some little nuts and bolts here, how much is the fee to do a submission?
Matchett: It's variable, it's a percentage of the award that's being requested. So if someone's requesting $100,000 for completion funds for their film, the submission fee is $100. So if we get 1000 submitters, then there's $100,000 in the contract for reviewers to earn by giving their opinions on those films. Actually, we just completed an award, in partnership with Steven Soderbergh for $100,000 in completion funds. The winner was a great film called Calladita, directed by a remarkable filmmaker called Miguel Faus. Actually, Steven is now an Executive Producer of the film.
It actually — just recently applied to Cannes, so hopefully, we'll be going to Cannes again with that film there, if it gets in. It was a great opportunity for this filmmaker, because he's a first-time filmmaker and now he's got the support of our network, and we have many industry partners in our network to help support the winning filmmakers and, of course, Steven, with all of his knowledge of independent film, helping him out. So, it's a great opportunity. At the end of the day, we are very excited to curate awesome content and discover great new talent.
Reselman: It sounds like it's a good way for the community to make some money. So if I wanted to become a critic and participate, how much money could I think about making?
Matchett: That's a good question. It's really going to depend on how much you participate. But if you work hard, there's a lot there in the contracts to be earned. So yeah, I do it in my free time and make some extra cash.
Reselman: Well, what can we say? Can we say more than a cheeseburger?
Matchett: Absolutely, yes. More than a cheeseburger.
Reselman: Okay, great.
Matchett: Yes, I've made hundreds, maybe thousands of dollars at this point.
Reselman: Oh, good. Good. Because we're seeing, this is a new economy, so we really have to figure out a way to support ourselves in a new economy. This sounds like a great opportunity. I have another, just a little technical, question.
Matchett: And, it's fun. It's fun to review... I mean, for me. It's not for everyone, I'm sure. But yeah, I love reviewing people's creative.
Reselman: I have a bit of a technical question about your focus on statistics. Do you have statistical models that you've developed at Decentralized Pictures that you use?
Matchett: Yeah, absolutely.
Reselman: Can you tell me about them?
Matchett: Sure. Yeah. We break down the data into demographic groups. We have different value sets, so each user will get a score in different genres. Some people will be better at analyzing horror, some people will be better at analyzing comedy. For each project that gets analyzed, we can look at the user reputation of all of the reviewers, how they voted. We can look at what region of the world they were in. We can look at their gender, their ethnicity, their age, and we can very accurately predict which markets a film should advertise to, based on the review data from the audience.
Reselman: Wow. I can think of marketing departments, like at Palmolive, GE, [and] American Airlines, that would really love to be able to execute this technology, and get this real-world data without having to do a whole lot of private data acquisition that's out there.
Matchett: Yeah. I worked in commercials at a production company for a long time, and we did thousands of 30-second spots for different companies. A lot of times, they'll do market testing after the thing is shot. So this would potentially be an opportunity for brands and ad agencies to market test briefs, or market test director boards, or campaigns pre-money, before they go and they spend a whole bunch of money making the actual 30-second spot and then realizing, "Oh, it's not really hitting our target market as we hoped it would."
Reselman: Sounds like a very effective way to do business innovation, it's a whole new way. It's pretty exciting. Well thank you, once again, Leo, for coming by. You spurred my interest so much, I had to continue the conversation.
Reselman: I trust you understand. So, thanks for coming by. We look forward to success in your ventures. Once again, tell people who you are and where they can find out more about Decentralized Pictures.
Matchett: Leo Matchett, I'm Co-Founder and CEO at Decentralized Pictures. You can check out our info site decentralized.pictures. It's the name with the dot in the middle. If you want to start reviewing, you can go to app.decentralized.pictures and start checking out other people's projects, help them get them greenlit, or submit a project of your own.
Reselman: Great. So, there you have it. I'm Bob Reselman with Blockchain Journal, coming to you from Outer Edge 2023 at the Los Angeles Convention Center, here in Downtown Los Angeles, California.