Manmohan Shetty is looking slim and relaxed. The chairman of Adlabs Entertainment is playing a lot of tennis these days. That explains the slimness. But how can a man who is spending Rs 1,650 crore, largely borrowed, on a theme park that has never been attempted in India, be relaxed? Adlabs Imagica, Shetty’s dream project, is supposed to open in March this year. The 300-acre theme park, modelled on Universal Studios’, would stress anybody. It involves 21 never-before-designed rides, a 300-room hotel, a water park and a host of other stuff. “I am enjoying it thoroughly. We are putting together people and technology,” he says, grinning from ear to ear. For a man who has spent more than half his 64 years punting on businesses that cross-pollinate films and their audiences with new media technologies, this is heaven, says Vanita Kohli-Khandekar.
Shetty set up Adlabs Films, a film processing company, in 1978. He financed Ardh Satya (1984) along with a slew of parallel movies such as Chakra and Hip Hip Hurray only because he believed in what the makers had to say. When capital was on offer, he was among the first to take Adlabs public (2000) — a decision he regrets. He set up India’s first IMAX theatre (2001), the first multiplex (2002) and seeded the first lot of 50 digital theatres (2003). Anil Ambani’s Reliance bought him and his partner out for Rs 360 crore in 2005. He has since then been an investor in various start-ups in animation (frameboxx), digital technology (Scrabble), television and films (iRock Media, Raajneeti, Tere Bin Laden, NDTV Lumiere).
Almost every business he seeded or kickstarted has been new, before its time and one that changed the ecosystem and economics of the industry. Multiplexes are now a way of life. They have unleashed both revenues and creativity helping the film industry grow over 10 times in as many years. India is now counted among one of the world’s largest digital screen countries. Digital cinema is plugging revenue leakages, killing piracy and bringing small-town India back in the reckoning, just like Shetty had envisaged in the various chats I have had with him on the digital experiment. And several media firms in films and television listed after he did.
By all accounts then Shetty is a visionary. He is also an old-media baron, who loves new technology. So, Adlabs Imagica is exactly the sort of mind-numbingly complicated stuff he would try.
His daughter and joint managing director, Pooja Shetty-Deora, joins us along with Dumbell, the cutest and fattest pug I have seen. Dumbell clambers onto a chair and shuts his eyes, completely disinterested in the proceedings. This seems to be a regular occurrence because both Shetty and Pooja ignore him. Shetty switches on the DVD player to run me through a short film on the park. As we watch simulated visuals of 4D rides such as The Curse of Salimgarh and Mr India, Shetty tells me that he first went to Disneyland in 1982. Since then he has seen almost all the major theme parks across the world.
But his fascination for getting into the business began in 2005. It appealed, he says, to his need to do something “different”. He suggested it to the powers-that-be at Reliance ADAG but they said no. In December 2007 when he finally left Reliance, he started work on Imagica. What took long was getting the land and the permissions that go with it. But the real challenge, funnily enough for Shetty, was getting the capital. While Shetty put in a chunk in lieu of equity, he needed a backer for the rest. For a man who has backed so many media projects, there were none.
“We couldn’t find a joint venture partner and we did not want to become a franchisee for Disney or anyone else. The media funds said we are a real estate company and the real estate ones said we are a media company. Nobody wanted to take a risk,” he recalls. It took his CEO and team over one year to convince 13 different banks to back bits and pieces of the project. This happened after it was scaled down from Rs 2,200 crore to Rs 1,650 crore.
As I am absorbing these facts, a weird noise erupts in the room. I look around and laugh — Dumbell is snoring. The father-daughter duo give him a look of indulgence and we get on. I ask Shetty the question that has been puzzling me most. Why does he always leave businesses before he can make serious money from them? He set up one multiplex and sold the business to his partners Fame; he set up one IMAX and left it at that. He seeded 50 theatres across Maharashtra along with Subhash Ghai’s Mukta Arts and just when it seemed like digital cinema was the business to be in, he lost interest in it.
He doesn’t pause before saying, “Operations don’t interest me, making new things does. Maybe I could have continued with Scrabble (a digital cinema business he funded in 2007. It was sold to UFO Moviez in 2011). Also, many times you don’t know, which time, what is the right thing to do.” That is the dodgy part of entrepreneurship and being in businesses of which the market has no context.
Does he regret not having a big studio today? Shetty’s stock in the Indian film industry is high because Adlabs Films (now Reliance Mediaworks) had for decades been the working capital partner for almost every Hindi film released. Remember that by the time the film comes to the processing lab, the producer has run out of money. But he can’t get the film, if he can’t pay the lab. By extending credit to several generations of producers, Shetty has earned the trust and goodwill of the biggest names in the industry. Even now he part-finances several projects or bails them out. But he has never attempted to do the studio number that UTV, Eros or the others are doing. Why not?
“You can’t make money in the film business today. If you are a producer, there is no job satisfaction; you are only Mr Moneybags. Only the stars make money, the producers and investors don’t,” says he. What about the studios, which claim to be making money? “The studios are pushed into doing films simply because they have raised money. Till the first print is out, some of the largest production houses don’t know what they have bought the rights to,” says Shetty.
The thing that fascinates him is digital — in delivery, content creation and consumer experience. So, India’s digital theatre revolution is great, he thinks, because 35 mm prints will die soon. In the US, he predicts, they are scheduled to be over by 2014.
He has married his interest in digital to his understanding of films to create several 4D games based on films, such as one on Mr India at Adlabs Imagica. “If this (Adlabs Imagica) works, I would like to do it in every state through franchisees,” grins Shetty. He is truly a glutton for punishment. However, his love for films, content and technology will keep him young, relaxed and with it, forever.