How to Finance Your Film – Part 2

Using product placement in your film, however, means that you will constantly be under the watchful eye of the brand managers, which would hinder your creative process. The problem is that there are only a small number of filmmakers with the pulling power of 007 so the brands will want to know your entire marketing strategy before they even consider investing in your film.

Crowdfunding

Crowdfunding, via sites such as IndieGoGo, Kickstarter, Kiss Kiss Bank Bank, and Ulule, is a valid way of financing your film. It also enables a model based on contributions for capital to be raised without needing to sell equity.

The strategy sees you compiling rewards, such as dinner with the director (if well-known), apparel and DVDs, and offering them to those who donate to the project. The goal is not only to raise finance for your film but also to build a community that’s sold on the idea of your story.

Even major players at studios are now using crowdfunding. Charlie Kaufman, the famous writer, producer, and director, raised more than USD400k for Anomalisa. This is crowding the pitcher and makes it harder to generate sufficient noise towards your project. That means that you need an excellent business plan before getting involved in crowdfunding.

Deferrals

The plan here is to have everyone who works on your film agree to be paid later from any profits the film makes, if it makes any at all. If a producer can negotiate a deferred deal, he or she can avoid almost all of the project’s costs.

You would need to convince everyone that you can’t wait for investment before getting the film made. For that, you’ll need to offer a percentage of the share of profits so everyone’s salary has the potential to increase, depending on how successful the film is. A deferred agreement basically states that cast, crew, locations, services, and vendors are all rendered in advance at no cost until the film has generated revenue upon release.

Self-financing

Financing your own movies means that you can avoid getting involved with investors. It further means that you need to be extra careful with the funds, being that they’re your own. One example of this in action would be Sean Baker, who directed the film Tangerine entirely on an iPhone before finding himself among the more talked-about directors of the year, as the film was one of the year’s best according to many critics. However, he gave an interview to Bret Easton Ellis in which he admitted to being still heavily in debt and dependent upon his parents to pay his bills.

While using your own funds might seem like an attractive solution in the sense that you can get started immediately, you should also note that the majority of self-financed films fail, largely due to the scripts not being good enough. By taking this route, filmmakers have gone around the development phase and no-one has had the nerve to tell them that they have a poor script.

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