

Creative new way to fund a movie - tialys
http://www.lobsterback.com/wehavetofindaway/

======
Keyframe
$250,000 is next to nothing for a movie budget. It can't be done. Here is why.
Aside actual pre-production, production and post-production costs (which COULD
be done for $250,000 - though more realistic budget is $2-3 mil), there is a
print distribution cost which can get REALLY high.

Distribution copies are expensive, about $1200 per reel copy if you are really
lucky (multiply with about at least 1200 screens for a moderate indie flick
(about $1.5 mil).

If you think targeting digital distribution sites is another option - think
again. You still pay print copy equivalent expense, but not to the print
service company, but to the actual screen venue. This is a ploy George Lucas
"invented" and pushed onto screening venues in order to push the cost of
digital screens to the distribution companies instead of the screening venues.
This will last for at least 5 years from when the venue bought digital
screening platform.

Then, there is a marketing cost. In A+ budget titles it is in the order of
$30-40+ mil. So when you hear about, I don't know, Spiderman 4 having a budget
of $200 mil., it means about 60% of that is marketing and distribution cost.

Now, let's turn focus on actual production costs.

SAG, WGA, DGA - all have a different perspective of what low budget means.
There are different categories of low budget titles, and based upon those
categories there is a minimum wage you have to pay to actors, screenwriters
(treatment, script, whatnot), director, etc... What this means, if you live in
some area of USA where those guilds operate is that you are illegal production
if you don't pay those minimum wages based on your budget. I have somewhere
those scales, if anyone is interesting I can follow up my post and present
them.

tl;dr; $250k budget is not realistic. Too many people have worked on this
problem already and smallest realistic budget for a visible project is in the
order of $2-5 mil.

~~~
taille
rian johnson's "brick", which won an award at sundance, was made for $450,000
on 35mm. then it was sold to distribution companies which made all of the
below costs you're talking about.

if they're shooting it on 16mm with a small crew (union or not) and their
actors are working indie sag, $250,000 doesn't sound unreasonable at all for a
film looking for a festival run + talking to potential distributors.

~~~
Keyframe
Yes, you are absolutely right. The best way to have a low budget production is
to find a film and drama school in a place where there is no union. You can
get a crew for next to nothing. They get screen credits which matter more than
you think, and you can provide food. You can rent a cheap digital camera like
Red One with lenses for about 600 Euros per day, a set of HMI lights and
electricity for another 1,000 or so - clothes and props... you can make a
movie for 50,000 Euro if you want (typical shooting schedule is about 20-25
days).

However, that wont bring your movie nowhere. You can seek a distributor, which
get tons of proposals and probably wont even look at your film (NDAs and lots
of proposals mostly). Think of distributors as VC companies and each movie as
a startup, because it is. Distributor has enough money to market the film.

Another option, which almost every indie production takes is festival run.
Festivals are great because if you win an award, distributor hears about you,
distributor might see you there with your movie and there are usually market
palces associated with festivals where distributors and TV houses shop for
movies and series (I work in animation and biggest is Annecy in France).

Some of you might think, why not go viral with the movie? Why not let it go on
the internet, market it around reddit, digg, whatnot - it could be a festival
like cycle, no? Well, no. You see, I would be the first one to do so, but if
you want your flick to be eligible for any kind of festival award (from Annecy
to Sundance to Oscars) it works in a funny kind of way. In order to make your
flick run in a festival, requirements to do so usually mean that it had to
already run on several festivals (Oscar eligibility for example) and almost
always there is a strict rule that your film is not publicly available (online
or distribution), which gives festivals a sort of premiere in their region.

Movie business is a strict business with a lot of rules and even more egos.
Each and every movie is run exactly like a startup that operates on milestones
and further funding.

~~~
anigbrowl
All true, but you can make those rules work for you. First, genre expectations
are different. Generally you need a famous name attached to sell a movie, and
you can't get one. But horror fans don't care much about actors. (Neither do
sci-fi fans, but sci-fi is exponentially harder to pull off). And fortunately,
horror fans like bargain-bin, formulaic movies.

There are plenty of horror and no-budget festivals, so if your film is not
total crap then you have a good chance in being selected for one. That'll help
you get more money from the distributor, but if you don't succeed it's not too
much of a loss.

The union doesn't matter too much. The lower your production budget, the less
likely they are to bother you. SAG (actors) has a very cool deal for no-budget
films that lets the actors work for free or minimum wage. Writer's guild just
does not care below 6 figures. Ditto for the crew and camera unions. Of course
the less you have to spend the less you can get in the way of experienced
people, but if you have a few enthusiastic key people who are willing to
shepherd some enthusiastic amateurs, you'll be fine.

RED One is an amazing camera, but I wouldn't use it for this kind of project.
It's still pricey, and says that you have money but you're not willing to
spend it on the crew. For the dirt-poor filmmaker, what you want is a
Panasonic HVX or similar that shoots 24/5P and which can put out or be
converted to something that looks fairly decent at 720p. And a friendly
producer.

If you turn in a film that does not completely suck for under $50,000, you can
probably sell it for enough to get your production costs back.

------
graphene
From the pdf at the bottom of the page:

IF YOU INVEST $50, AND THE FILM IS...

SOLD FOR $250,000 = YOU GET $50 (100% RETURN)

SOLD FOR $500,000 = YOU GET $75 (150% RETURN)

SOLD FOR $1,000,000 = YOU GET $88 (175% RETURN)

I don't think traditional investors count like that.. I presume the investors
won't get paid back their initial investment, so if the film sells for 250k
and each investor gets his $50 back, that's a return of zero. A return of 100%
implies a doubling of your initial investment..

Please correct me if I'm wrong, but I think the way it's phrased here is quite
misleading (otherwise great idea though).

~~~
anigbrowl
That's quite true. I like the idea (since I'm in film myself and I hate
begging people for money), but yes, it does seem like something the SEC would
disapprove of, which is why most internet film fundraising requests non-
refundable donations in exchange for collector's editions and stuff like that.

Edit: well I guess their lawyers are sure of what they're at. I hope they
write about or open source their process, as I'd far rather raiser cash in
micro-amounts based on the strength of the script etc. than sit in investor
meetings.

~~~
anigbrowl
(Can't edit any more) after taking a bit more time to look through their
offering, I retract my statement about the lawyers. Legally speaking, it's
radioactive. The upside is that the sums solicited are so small it's probably
not worth suing over.

------
pchristensen
I love the idea but I'm a little worried about how they keep calling it an
investment. I don't know the details but the phrase "accredited investor" and
the issues Prosper had come to mind. I sure hope they don't get into trouble
for using the word "investment" without discussing the return.

EDIT: Oh, there's a spreadsheet at the bottom with potential return
information.

~~~
tialys
Yeah, they raised over $19,000 the first day, panicked and called their
lawyer, but they've determined it doesn't violate any SEC laws, so it's back
up and moving.

~~~
falsestprophet
The only way they could have accomplished this is by calling a lawyer that
doesn't know anything about securities law.

~~~
anigbrowl
I looked at the agreement and the law firm. They have no background in
entertainment law and it shows. I hate to be the bad guy and am not a lawyer
but even I can see it's a ticking time bomb. I don't know about securities,
but I do know a fair bit about entertainment contracts.

In the event that any of the principals is reading this, read clause J again.
That is the least of the things wrong with it.

------
gogoslava
IndieGoGo is helping to centralize the process of legally raising money
online. We have almost 2000 films/projects on IndieGoGo and filmmakers have
been able to raise $10s of thousand at a time. Including Sundance Award
winners. Please email info [@] indiegogo with any questions.

------
costan
Can you have 5000 share-holders in an LLC?

~~~
frossie
They are not called shareholders in an LLC, they are members, and there is no
maximum number. [Disclaimer: IANAL]

I gave them $50 because I liked the way they asked. I certainly don't expect
to see it again :-)

------
TrevorJ
This is a nice idea, I wish him well.

------
WalterSear
Not new.

~~~
tialys
I've never heard of anyone raising money for a feature film this way, but I'd
love to hear more about anyone else who has. Can you give me an example?

~~~
pageman
we've done this for <http://leaudouce.com/seednotes.htm> (raised 10% of budget
in 30 days, budget at around 2M USD) - if anyone else is interested in raising
the 90%, buzz me! :)

