Blumhouse Productions has a secret sauce when it comes to making great horror movies: Keep the budgets low and give the directors full creative freedom. And with huge box office successes like Get Out and Split, just to name its most recent films, Blumhouse may be onto something.

Get Out, the latest film produced by Blumhouse, brought in more than $163 million domestically, according to Box Office Mojo. The movie had a budget of only $4.5 million, and received a rare 99 percent rating on Rotten Tomatoes. And with newly secured plans to expand into TV, Blumhouse isn't slowing down anytime soon.

"One of the things that has been great about the response to Get Out, it acknowledges that you can make interesting, challenging movies that happen to be horror thrillers," says Couper Samuelson, 37, the president of feature films for the company. "It kind of emboldens us to make sure that there are galvanic and interesting ideas in our scary movies."

With budgets, less is more

The Los Angeles-based company was founded by Jason Blum in 2000, but didn't adopt the micro-budget model until 2009. A spokesperson for Blumhouse declined to share revenue figures for the company, but the production house was behind some of the most popular horror series in the last 10 years, including the Paranormal Activity films and the Insidious chapters.

Blumhouse generally spends about $5 million or less on an original and up to about $10 million on a sequel, Samuelson says. These prices aren't because the production house is trying to pinch pennies; Samuelson notes that it helps promote creativity.

"Anytime you limit somebody, it always--in terms of resources--kind of creates opportunities," Samuelson says. "Our movies have few visual effects. When you have someone in prosthetic makeup as the demon that can feel more real than if you have the best computer visual effects artist painting."

Those low budgets create fear, and big returns. The Purge series, centered on a fictional night when all crime is legal, was one of Blumhouse's most notable movies series. The first film, which was released in 2013, had a budget of just $3 million. It went on to earn $64 million domestically, according to Box Office Mojo. The second installment had a $9 million budget and brought in more than $71 million one year later. The third movie got an extra $1 million for the budget and earned more than $79 million in 2016.

"If you're not doing horror movies like Blumhouse right now, you're doing it wrong," says Jeff Bock, a box office analyst at Exhibitor Relations Co., adding that Blum is the maestro of micro-budget horror. "When you get those kinds of returns on that kind of budget you are doing it right, perfectly, in fact in terms of Hollywood structure."

Horror hits on the rise in Hollywood

Blumhouse isn't the only production studio making frighteningly good and cheap content. New Line Cinema, a competitor of Blumhouse, is also tapping the micro-budget business model. Last July, New Line released Lights Out, the tale of a malevolent presence that lurks in the dark and made $67.2 million domestically, according to Box Office Mojo. The film cost $4.9 million to make.

The directors of Blumhouse's hit films have come back to Blumhouse to make sequels or news movies, giving the production house repeat business with the hottest names in horror films. One of the strategic ways Blumhouse builds relationships with filmmakers is by inviting them to screen their works in progress. Samuelson says this is great way to talk with the directors and bounce around thoughts or ideas about the movie.

"The way they construct their films in a think tank works. They are basically printing money in these think tanks, says Bock, adding that typically one one horror flick will make $100 million or more per year. Get Out and Split both earned over $100 million domestically. That's a rare feat for the horror industry.

Blumhouse has more spooky plans in the works. On April 4, the company announced its plans to launch an independent television studio with ITV Studios, acquiring a 45 percent stake. The investment values Blumhouse at $80 million, according to Deadline. What's more, the TV studio will be produce two new series: The Purge (for USA and Syfy) and Secure and Hold: The Last Days of Roger Ailes (for Showtime). Blum told The New York Times that Blumhouse television will focus on "things that scare us," and not just horror.

"Over the past few years, we have been working to build Blumhouse Television into an independent studio so we can have the autonomy to work with the best storytellers and give them freedom to create the best dark genre programming," Blum says in a statement. "It is a dream that day is here."

 

Published on: Apr 13, 2017