Spain’s SETT Takes Aim at Global Audiovisual Dominance

The Spanish government has been quietly building a behemoth in the audiovisual industry, threatening to disrupt the global market. The state-backed venture capital fund, the Spanish Society for Technological Transformation (SETT), has invested €215.6 million ($252.3 million) into Spain’s film, TV, video game, and new technology sectors over the past 12 months, sparking matching private-sector investment of a further €230 million ($269.1 million). This unprecedented level of support is notable, especially considering it’s four times the average budget of Spain’s core subsidy fund at the country’s ICAA Film Board.

SETT represents a fundamental shift in how governments approach supporting their industries. For decades, Spanish governments have focused on providing individual filmmakers with subsidy grants and loans. In contrast, SETT invests up to 10 years in companies with a portfolio of productions, requiring co-investment from private-sector partners, and seeks to give them an edge in the international market.

According to María González Veracruz, Spain’s secretary of state for digitalization and artificial intelligence, “We are moving from an era of encouraging an ecosystem to consolidating a truly international audiovisual industry.” This vision encompasses not just film production but also the entire value chain, from development to distribution.

One notable investment has been in Good Films Studios Spain (GFSS), which aims to produce competitive English-language movies with big-name stars. Miriam Segal, GFSS head and producer of “Good” starring Viggo Mortensen, praises the support she receives from SETT as crucial to her company’s success. This move may seem bold, but it’s a calculated gamble in a market where opportunities are scarce.

The key to SETT’s success lies in its operations. By taking stakes in companies, providing co-investment, and promoting public-private partnerships, SETT is building a formidable force. For instance, its latest investment in Impulse Studio has given the company a global reach, enabling it to secure deals that might have been out of reach otherwise.

The animation sector is another area where SETT sees significant growth opportunities. With an investment of €9.2 million ($10.7 million) and partnerships with Planeta Junior and Amuse Animation, SETT co-bought select distribution rights to the hit preschool series “Milo.” This move underscores the importance of animation in the global market and highlights Spain’s potential as a leader in this field.

Maria Rua Aguete, an expert at London-based consultancy Omdia, believes that Spain is poised to transition from being a production destination to building globally competitive Spanish companies. However, with EU Next Generation funds running out on August 30th, it remains to be seen whether SETT will sustain its momentum.

The stakes are high as global markets contract and opportunities dwindle. Governments and industry leaders must think creatively about how to support their industries. SETT’s model offers a compelling solution that could potentially disrupt the status quo and create new avenues for growth. The question remains whether this vision will translate into reality or remain a distant promise.

It is too early to tell what the full implications of SETT’s efforts will be. However, one thing is certain: Spain has taken aim at global audiovisual dominance, and the world would do well to take notice.