LOS ANGELES 鈥 Veteran movie producer Jason Blum has turned filmmaking on its head 鈥 delighting investors and annoying competitors 鈥 with his innovative 鈥渕icro-budget鈥 approach to the craft.

By saving on every aspect of the process and keeping an iron grip on the bottom line, his Blumhouse Productions company has managed to make some of the most profitable movies in history.

From Paranormal Activity in 2007 to this year鈥檚 critically acclaimed Get Out, the 48-year-old producer has made many of the defining horror films of the last decade 鈥 always on a shoestring.

鈥淭he most important part to making a successful low-budget horror movie is the story and acting has to be great. Not the scares 鈥 the scares are less important than the story and the acting,鈥 he tells AFP.

Paying actors peanuts, but working with studios that ensure that his films get worldwide distribution, he has recouped some $3 billion at the box office from a portfolio made for less than a 20th of that amount.

Of his most recent work, Jordan Peele鈥檚 Get Out, M Night Shyamalan鈥檚 Split, James DeMonaco鈥檚 The Purge: Election Year, and Mike Flanagan鈥檚 Ouija: Origin of Evil have grossed $664 million on a combined budget of $27.5 million.

An executive working for Harvey and Bob Weinstein at Miramax, Blum was briefly an independent producer at Warner Brothers before striking out on his own with Blumhouse Productions in 2000.

Blum鈥檚 career-defining 鈥 and life-changing 鈥 moment came when he saw an early cut of Paranormal Activity, which had been put together for $15,000.

When no one else would touch it, he saw its potential and came on board as a producer, steering it to a worldwide gross $193 million and making it the most profitable movie of all time.

He analyzed the success of the film and realized he had a revolutionary formula that he has since repeated over dozens of low-cost titles including the Insidious and The Purge franchises.

Paranormal Activity taught Blum not only that low budget meant more chance of making money, but also that keeping a tight grip on the purse strings often makes for an artistically more accomplished movie.

This is how he does it:

1. NONNEGOTIABLE BUDGETS
With very few exceptions, Blum鈥檚 original movies are given production budgets stretching no further than $5 million.

Sequels can go up to $10 million but the producer is not in the business of allowing directors extra cash, no matter how much they insist the boost will improve the movie.

2. LOW-PAID CREATIVES
The most important thing, Blum says, is that his 鈥渁bove the line鈥 team, the creatives, work for almost nothing, or as close to it as unions will allow.

Even well-known actors don鈥檛 get the star treatment: for the first The Purge movie, Ethan Hawke, who has four Oscar nominations, recalls having slept on Blum鈥檚 couch every night of the film shoot.

Actors are told most of their money will come through profit-sharing, while directors are often persuaded to come on board because of the creative freedom Blum allows them that they wouldn鈥檛 get from big studio productions.

3. EXPERIENCED DIRECTORS ONLY
Blum only works with directors who have established track records, never first-timers.

He likes people at the helm who have experience in finding innovative solutions while working on tight budgets. First-time filmmakers need not apply.

4. NO THEATRICAL RELEASE GUARANTEE
Blumhouse鈥檚 original projects are invariably made without a release date in mind, and it鈥檚 not until the finished product is screened that Blum decides how to play it.

Actors and directors are never promised a wide theatrical release, and around half of his movies end up on iTunes, Netflix, or various video on-demand services.

This way, Blum can guarantee a movie will break even, no matter how well (or poorly) it is received.

5. LOCATION, LOCATION, LOCATION
Looking to shoot your sweeping historical epic on five continents, with grand panoramas across desert, tundra, grasslands and oceans? Forget it.

Most of Blum鈥檚 movies are made within a few miles of his apartment in downtown Los Angeles. You鈥檒l be lucky if he allows you to shoot your entire movie in more than three locations.

Often, you鈥檒l be confined to a few rooms in a single house.

6. SMOKE AND SCREAMS
Computer-generated imagery is a no-no. If you want a plane crash in your movie, you鈥檒l probably have to represent it with an interior shot of passengers screaming and a bit of mangled metal smouldering in a field.

The full CGI plunge into the San Francisco Bay is just too expensive and time-consuming for Blum to countenance.

7. KEEP IT ZIPPED
Blum knows the union rates for speaking roles in movies; he prefers having as few actors as possible do the talking.

Extras hoping for a line of dialogue should probably try for a job on a Michael Bay movie set instead. 鈥 AFP