The price of independence for A24 Would we still watch their films if it were to be acquired?

In one of its latest articles on A24's successes, Variety reflects on the production company's future. Rumors of a possible acquisition have been circulating since its earliest successes, but co-founders David Fenkel and Daniel Katz, who established A24 in 2013, have always rebuffed every offer, maintaining complete control. This year, however, rumors of a sale have multiplied, fueled by the enormous success of releases such as Backrooms, You Can See Everything (one of the highest-grossing documentaries ever recorded) and The Drama. 

But if A24 were acquired by a company like Amazon, the perception that audiences and fans have of the company would change dramatically. Over the years, the production and distribution house has built an aura of independence — one rooted not only in its lower investment levels compared to the major studios, but in a genuine personality that, beyond shaping the way its products are made, makes it recognizable through its modern, cool character. 

To this day, the company still retains its fresh and irreverent spirit, but the way it produces films has inevitably changed. It is no longer solely about making low-budget movies — though budgets remain modest relative to the company's means — but about expanding and proving its artistic and commercial worth. Proof of this lies in the project with the highest budget in the company's history: Elden Ring, the adaptation of the famous video game directed and written by Alex Garland and starring Kit Connor, which cost $200 million.

The pros and (mostly) cons

A24 is coming off a 2026 that allowed it to reach the heights of the box office and could secure it top spots on Oscar night. And yet, the results achieved are proportional to the company's still independent and lean scale, and bear no comparison to the revenues and returns of more established studios. This is precisely why companies like Sony might view A24 as a potential acquisition target. 

The year's successes have also helped offset box office flops. Backrooms, made for $10 million and earning $400 million, was the true phenomenon of the year, but equally remarkable were the results in two genres — the (sui generis) rom-com and the documentary — which typically don't put up big box office numbers. With The Drama, A24 turned a $28 million budget into $134 million in global box office receipts; with You Can See Everything, an investment of around $7 million became $64 million in revenue (and still climbing). There were, however, some stumbles, including How to Make a Killing ($21 million at the box office against a $15 million budget), The Death of Robin Hood ($9.8 million on a $20 million investment), and Misty Green ($160,000 on a $5 million budget).

Daniel Katz and David Fenkel's strategy for recovering losses

It should be noted that, all things considered, even the results that fell short of expectations appear to be managed with a certain degree of skill by A24 — particularly because the company does not handle the international distribution of its titles, but instead sells the rights abroad, entrusting the process to regional distributors and thereby recouping losses where they occur.

Of course, when things go well for a film, there is a downside: if a film like Backrooms earns more than $200 million internationally, A24 cannot get its hands on that revenue. It appears, however, that to work around such a loss, company founders Daniel Katz and David Fenkel have been actively seeking potential partners to establish their own presence on the international stage — finding companies that share A24's sensibility so as to be able to operate with local teams under their own direction.  

Such a solution highlights how, from the very beginning, it has been important for the company to pursue growth from within rather than through third-party support. And every milestone reached has been thanks to key figures within the company, such as chief operating officer Matt Bires, global head of the TV division Ravi Nandan, and marketing director Graham Retzlik.

A24's move into serialized content also reflects an internal expansion strategy: it began back in 2015, reached its peak in 2019 with Euphoria, and in recent times has seen collaborations with Amazon on Overcompensating, Apple TV+ on Margo Has Money Problems, and HBO on Crystal Lake.

Learning to swim in a bigger tank 

The question that naturally arises — and that A24's founders are surely asking themselves — is: how can you compete with the big players without losing your identity? Preserving the brand is the reason why, when Apple and Sony approached the company over time with potential acquisition offers, Fenkel and Katz chose to decline. And it is what people are now wondering about, even following the announcement of the impending acquisition of the social media platform Letterboxd by the New York Times Company.

What one can hope for is that, despite the advertisements and sponsored content that will inevitably appear on the platform, Letterboxd will maintain its authenticity even under the New York Times' ownership. All things considered, the fact that the buyer will be a publication that protects its content — charging for its articles in a world where information is increasingly free in terms of protection and preservation — gives reason for optimism. 

That A24 is destined to make a significant shift in its trajectory in the near future is clear, not least in light of the ever-increasing budgets it is investing in its upcoming projects. A strategy that, beyond the company's devoted fans, will now need to capture the attention of a broader audience as well. 

Some attempts in this direction have already been made and have not gone particularly well, such as Benny Safdie's The Smashing Machine and Ari Aster's Eddington, both costing $50 million and both rejected at the box office. This year, A24 will try again through the acquisition of some significant intellectual properties — chief among them the imminent reboot of The Texas Chain Saw Massacre, which will see none other than Curry Barker — who broke through this year with Obsession — handle both the screenplay and the direction. 

In any case, A24 will need to be very careful not to lose the trust of its audience, particularly its younger fans, who have placed their full support behind the production and distribution house. It is far from certain that they would look favorably upon a deal in the style of the Paramount Skydance merger, which acquired an asset like Warner Bros. for $110 billion. Something A24 may well aspire to, but which requires careful consideration.