"There is a high risk of failure when launching an independent film studio because you don't have the regular cash flow of an established company and are entirely dependent on hit movies that make a profit," said John Hyde, an industry veteran who is now vice chairman of Image Entertainment. "You have to either be well capitalized to get through the rough early days or you have to be very lucky."
Since Relativity began releasing its own movies late last year, luck has proved elusive. It scored in March with the Bradley Cooper thriller "Limitless" but flopped with the 1980s-themed comedy "Take Me Home Tonight," the Nicolas Cage fantasy film "Season of the Witch" and the Gerard Butler drama "Machine Gun Preacher."
Pre-release surveys indicate "Immortals" could have a solid opening of $30 million or more. Its primary audience, young men, has been fickle this year, but Relativity hopes the film's shared producer pedigree with the 2006 hit "300" will draw women too. "Our sweet spot is men between 17 and 34, but 'from the producers of "300" ' is our calling card to women, because they eventually embraced that movie," said the company's marketing chief, Terry Curtin.
To succeed, and compete with the major studios' films, "Immortals" and Relativity's other pictures need to hit big at the box office and generate sequels. "Without a library as deep as Disney, it's hard to get access to bigger properties," acknowledged Tucker Tooley, Relativity's co-president.
Following "Immortals" will be the March release of "Mirror Mirror," a wry, family-oriented reinterpretation of the Snow White legend that stars Julia Roberts and cost nearly $100 million to make, as well as several smaller films this winter including "Act of Valor," which stars real-life Navy SEALs.
The longer-term picture is hazy, however. Relativity has six movies ready for release by next April but nothing beyond that except "21 and Over." Two additional movies are scheduled to come out in June and December, but neither has yet hired actors.
Kavanaugh's aspirations have extended beyond the traditional movie business, with mixed results. This summer he made an early and aggressive move into China, putting Relativity into a joint venture that allows its films to be released in the growing movie market and provides new money for co-productions like "21 and Over."
After acquiring the genre film label Rogue Pictures from Universal in 2009, Kavanaugh said he would build Rogue into a "lifestyle brand." He filed trademarks for Rogue-brand baby clothing, energy drinks and Internet dating. Nearly three years later, however, that vision has yet to become reality.
Kavanaugh said Relativity needs only to hit "singles and doubles" to be a success and is taking innovative steps to minimize its risk. That was certainly true with "21 and Over." As part of its Chinese makeover, producers weaved in additional plot points about a character named Jeff Chang.