Stephen Chow Told Japan to Stop Aping Kung Fu, K2 Pictures Founder Says

Stephen Chow once told Japanese producers to stop imitating kung fu and build action films on their own martial arts, K2 Pictures founder Kii Muneyuki said Saturday at the Taiwan Creative Content Fest in Taipei.

"He said, 'You have karate, judo, jujitsu and kendo. That is Japanese culture. Only you can turn it into action films, so you should be the ones doing it. Stop aping kung fu,'" Kii recalled. He said he has shared drinks with Chow in Tokyo a few times. He agreed with the Hong Kong star-director, citing the Netflix sumo drama "Sanctuary" as the kind of project that draws on culture unique to Japan.

Kii's K2P Film Fund I, which backed Kore-eda Hirokazu's "Look Back," closed its $33 million equity round in February. Some 30 companies have invested, led by MUFG Bank, Japan's biggest lender. Other backers include Bandai, Dentsu, the government-backed Development Bank of Japan, and property firms Tokyu Land and Mori Trust. Kii serves as the fund's general partner.

Could the fund reopen to new investors?

Kii said more companies approached K2 about investing after the close, and the round could reopen if existing backers agree. He has not yet decided whether to do so.

The equity is being paired with loans added one after another, which will ultimately total $67 million. That gives a planned total of $100 million and a target of 50 films over seven years.

Kii shared the TCCF stage with director Nagata Koto, whose Fukushima-set noir "The Nuke Crab" K2 unveiled at Cannes in May. The film follows those who profited from the huge sums that flowed from across Japan into the radiation clean-up of the Tohoku region. Kii and Nagata aim for a hit in Japan and in Eastern Europe, including Poland and Ukraine, where he believes audiences who lived through the Chernobyl accident might connect with it. The project is in development, with a shoot targeted for next year.

Nagata, whose "Baka's Identity" competed at Busan last year, called the subject socially taboo in Japan and the kind of material TV networks or major studios would never take on. "When I took it to Kii-san, he immediately said, 'That sounds interesting, let's do it,' and got it started," she said.

Pairing Japan with one other specific market is a strategy K2 calls "Japan plus one." Kii said what Americans, the French, Taiwanese and Korean audiences each like about Japan is completely different — and the Japan that Japanese people like is different again.

What does this change for Japanese filmmaking?

K2 Pictures was set up as an alternative to Japan's production committee system, under which films are made mainly for the local market. Kii, who started out tearing tickets and making popcorn in cinemas before rising to producer at Toei, said the closed system kept out foreign and outside investment, which in turn made it hard to share returns with creators.

Profits at K2 are calculated title by title, with 70% going to investors and 30% to the creative side. "Producers and the people involved in making the film aren't putting up money, but the film exists because of their creativity," Kii said.

The company completed six films this year, including "Look Back," Kore-eda's live-action adaptation of Fujimoto Tatsuki's manga, which competed at Venice, and Son Myung-ah's debut feature "Trophy," due to open in Korea. Kii targets six or seven releases a year but admitted that, a year in, the pace is "pretty tough."

K2 has opened outposts in Taiwan and Korea to distribute its films directly in both markets. Kii said 99.9% of Japan's overseas film business consists of licensing deals, which do little to raise the value of Japanese titles abroad. "Japanese people taking Japanese films to that place and promoting them hard there – I think that's what raises their value," he said.

How does a film get greenlit?

Greenlighting rests with K2's six or seven producers, Kii included, and he does not block a project a producer is set on. The only test is whether costs can be balanced against likely revenue. "Nobody can tell whether a film will be a hit," he said. That logic applies equally to arthouse and commercial work: "If it's only going to bring in JPY50 million ($330,000), make it for JPY20 million ($130,000)."

For first-time directors, producers can line up pre-sales, streaming rights deals and sponsorships so a debut cannot lose money, because a big loss makes a second film hard to finance. "I want to keep launching new directors from K2 Pictures," Kii said. "And I want them to be grateful for the rest of their lives. Don't forget us when you make it big."

Kii also wants the law changed. A British entertainment lawyer and an American completion bond executive both told him the film business works much like real estate: producers create assets and then turn them into cash. Japan's investment trust law, passed around 2000, lets real estate be securitized but does not cover content. Kii said he has been discussing such a law with lawyers and hopes to push for one.

The session was moderated by filmmaker Huang Yin-yu Kou of Taiwan's Moolin Films, founder of the Cinema at Sea – Okinawa Pan-Pacific International Film Festival. With "The Nuke Crab" targeting a shoot next year and the fund weighing new investors, K2's test of the "Japan plus one" model is only beginning.