How Paranormal Activity Became The Most Profitable Horror Film Of All Time

When I watched "Paranormal Activity" many years ago, it kept me up at night. That's a big deal, because I grew up watching horror movies. "The Conjuring" is oddly comforting to me, and I can eat "The Exorcism of Emily Rose" and the likes of it for breakfast. But there's something about "Paranormal Activity" so real that I can't help but be terrified.

The first film in what would become a big franchise is ingeniously made, despite heavily relying on jump scares. It requires straining your eyes just so you can notice a shadow at the door. But if there's any slow-burn horror movie that can truly make you worry whether you're alone when you sleep at night, it's this one. What's most impressive is that all of this comes from a simple story, honest execution, and a shoestring budget, which all helped make it the most profitable horror movie ever made.

I know what you're going to say. "It," the 2017 film adaptation of Stephen King's novel of the same name, is the highest-grossing horror movie of all time — but it's not the most profitable one. Next, you might be thinking, "What about It and The Blair Witch Project?" Yes, at one time the innovative found footage horror movie was the most profitable horror movie of all-time after debuting in 1999. But it was eventually usurped by "Paranormal Activity."

"Paranormal Activity" earned $193 million worldwide against a measly budget of $15,000, which makes it the most profitable horror film ever made, based on return on investment (via The Wrap). The movie eventually spawned a franchise that made nearly $900 million, yielding an unimaginable 433,900 percent return on investment. Meanwhile, "The Blair Witch Project" generated an impressive 414,233 percent against its $60,000 production cost. 

Director Oren Peli had a simple vision for "Paranormal Activity." It was filmed in his own house (how he continued to live there is beyond me), the actors were unknown talents, and the film's most significant moments are scary but didn't require any major setpieces or expensive visual effects. It's literally cheap but effective fear and suspense where your imagination is doing most of the heavy lifting.

For instance, Katie being pulled out of the bedroom by an unseen force doesn't require CGI or prosthetics. Watching Micah run after her to save her is frightening because, as viewers, we have no idea what's going on beyond the room we're focused on. These illusions are impactful and undoubtedly result in a few screams. The found footage style also made "Paranormal Activity" easier to film than, say, making people levitate mid-air or spider-walk down a flight of stairs, like in "The Exorcist" or other films in the same vein.

Oren Peli used the found-footage convention to convince moviegoers everything they were watching was taking place in the real world. The camera is stationary, the acting is effortless, and the suspense is thrilling — one can only wonder if another movie will ever be able to capture or mimic the cleverness with which "Paranormal Activity" instilled fear in our minds.