Film Financing, Marketing Ben Yennie Film Financing, Marketing Ben Yennie

How to Finance your Documentary

Documentary and narrative films aren’t just different styles, they’re entirely different beasts! It’s amazing how different the financing systems are. Learn more in this article.

It’s hard to find reliable information on film financing.  I’ve written a fair amount about independent film financing for narrative projects.  Since writing those blogs and doing numerous presentations on the topic, I’ve gotten a lot of questions on how to finance documentaries.  Since I haven’t seen a good guide, I thought I’d write one.  Here’s a step by step guide on financing documentaries.

1. Establish a deep connection with the audience that cares DEEPLY about your message.

Authenticity has been become incredibly important in all aspects of making your living as a filmmaker, journalist, or content creator of any kind.  As documentaries are primarily message films, authenticity and accuracy are even more important than they would be in your standard genre picture.  A deep understanding of the subject matter you’re tackling is absolutely vital for documentaries, as documentaries tend to rely much more heavily on word of mouth and community involvement than traditional narrative films.  

The primary goal you should have when establishing yourself within this community is to speak authentically about the community in your film. By doing this, you will most likely also establish credibility with the audience that is most likely to shout about your film when it comes out.  As a bonus, through the process of establishing a deep connection with the subject matter, you are likely to find good subjects to interview for your documentary.   

2. Get a fiscal sponsor

A fiscal sponsor is a non-profit organization that can extend its non-profit status to your simple for-profit entity allowing you to take tax-deductible donations, which can greatly help you raise donations from friends, family, and even certain crowdfunding platforms.  They’ll normally take a fee of between 4% and 9%, but they’ll increase your close rate dramatically.  Additionally, unless you are a non-profit, you’ll most likely need a fiscal sponsor in order to apply for grants.  

3. Apply for relevant grants

Next, you should start applying for grants.  You don’t need to limit yourself to filmmaking grants, you can also apply to grantors that tackle the subject matter you’re planning on documenting.  So long as those foundations and grantors back projects to build awareness there’s a good chance you’ll be eligible for those grants.  I wrote another blog with the help of one of the fundraisers for Slamdance a while back, you’ll find it below.

You should start applying for grants once a month as soon as you can.

Related: 5 Rules for Grantwriting.

4.  Confirm one high-profile expert in your field to give yourself legitimacy

Now it’s time to start shooting your film.  Confirm an interview with an expert, possibly using the connections you’ve developed back in step one.  Otherwise, reaching out to universities that have programs related to your subject matter is a generally good bet.  Most of the time, you shouldn’t need to pay the academics or many of the other experts who might be interviewed for the documentary. For them, it’s good press to build their legitimacy and public profile.

5.  Prepare a crowdfunding campaign

This is another reason Step 1 is to ingratiate yourself in a community.  If you’re a known entity in that community, your chances of success are much better and the amount you’ll be able to raise is much higher.  While this is harder than it once was, it’s nearly impossible if you’re not an established part of the community.

Here’s a blog on a crowdfunding timeline.  

Related: Crowdfunding Timeline for Filmmakers

6. Get a few more experts in your network to give interviews

Ramp up your production and get a decent portion of the film shot and start to find the narrative throughline for the finished piece.  You will want to start charting this path as you shoot, as it can help guide you through future interviews or even re-interviews if you can.  

7. Launch your crowdfunding campaign. 

You do that after the first expert as if you’re doing it properly, you should be able to use a portion of the interview as an immediate delivery once the campaign closes.  If you have multiple experts at this point, you’ll have some degree of legitimacy that you could turn into a short as one of the major funding levels.

Even after you raise the money you need for your main round, you should continue to apply for grants on a monthly basis.  The reason n why will become clear later. 

Here’s a blog on the dos and don’ts for pushing your movie on social media.  I wrote it after a few too many people sent me auto DMs.

Related: 5 Dos and Don’ts for Selling Your Film Online.

8. Get a few higher profile influencers in the documentary.

If you get a few subjects in the documentary with some degree of a following, it will likely help boost the visibility of the documentary once it’s getting ready to come out.

9. Release regular updates on social media

If you make sure to release updates and engage with your following on the goings on of the documentary you’ll be much better able to keep in the consciousness of your community which will make a rather large difference when it comes time to distribute your project.

10. Make sure you keep your backers informed.

Take what you’re doing on social media, and give more depth and detail as to the goings on of the project, as well s content to the people who have supported you financially. There are a couple of ways you can do this, the simplest is to continually communicate through whatever platform you originally crowdfunded through.

11. Keep applying for Grants, but now focus on finishing funds.

Applying for grants isn’t something you should have stopped doing, but at this point in the cycle, you should be applying for grants to finish your movie rather than develop or shoot it.  If you’ve consistently been applying all this time, you’re more likely to succeed at this point as you may well be starting to re-apply for the same grants you didn’t get last time.  

12. Launch a secondary crowdfunding campaign for finishing funds

This is part of why you’ve continued to stay in touch with the people who backed your first campaign, as it’s much more likely they’ll come back for your next round if they’re happy with your communication skills as well as the progress you’ve made.  

13. Ramp up the content you’re releasing

Before you may have released photos from interviews on social media, and teasers to your backers.  Now you may want to release teasers on social media and short interview clips to your backers.  You don’t want to release anything that will give too much away, but you want to build buzz and have a deep engagement with your backers.  You want them to feel like they made your movie possible.  In a very real way, they did, and they may have gotten you to the finishing line. 

14. Apply for impact grants

Impact grants focus on getting the film out and into the world.  They cover things like festival submission, travel, and other costs related to marketing and distribution.  You should start applying for these grants when you hit picture lock.  

NOW THAT YOU’VE FINISHED MAKING THE FILM…

15.  Hire a publicist (If you can)

Publicity isn’t cheap, but it is one of the best ways to build both the profile of your film and of you as a filmmaker.  Getting press early on will help you in the next parts of your process.

16. Apply to festivals

Now that the film is done, you should start applying to relevant festivals.  If you’ve already gotten some press coverage, you’re more likely to get in, however, the time your publicist will be of the most use is during your festival rune.

17. Get a Lawyer, and get them to do an E&O Coverage letter.

If you didn’t already have a lawyer, get one now.  A lot of lawyers will do some pro-bono work for documentary filmmakers as a public service, so don’t hesitate to ask.  Along with being a steadfast advisor, they’ll also have the ability to write a fair use clearance letter which will enable you to buy E&O Coverage if and when you need it.  Also, you should really have a lawyer on call when you move on to step 18. 

18. Get a producers rep, or sales agent and distributor

Finally, you should make sure to start reaching out to producers reps sales agents, and distributors as soon as you can after submitting to festivals.  Some of us can help make sure you get into bigger and better festivals, but any reputable person with these titles has a much better chance of getting you a profitable distribution deal on platforms 

After the success I’ve seen from one film I both repped and distributed film Queen of the Capital, I’ve recently started putting a greater emphasis on documentaries, since my direct contacts in that area have grown significantly.  You can learn more about Guerrilla Rep Media Services film below.

Thanks so much for reading, if you liked this content, please share it.  Also, join my mailing list for some great resources including a festival brochure template, ebook, and a whole lot more.

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Filmmakers Glossary of Film Business Terminology.

I’m not a lawyer, but I know contracts can be dense, confusing, and full of highly specific terms of art. With that in mind, here’s a glossary of Art. Here’s a glossary to help you out.

A colleague of mine asked me if I had a glossary on film financing terms in the same way I wrote one for film distribution (which you can check out here.)  Since I didn’t have one, I thought I’d write one.  After I wrote it, it was too long for a single post, so now it’s two.  This one is on general terms, next week we’ll talk about film investment terms. As part of the website port, I’m re-titling the first part to a general film business glossary of terms, to lower confusion on sharing it. It’s got the same terms and the same URL, just a different title.

Capital

While many types exist, it most commonly refers to money.  

Financing

Financing is the act of providing funds to grow or create a business or particular part of a business.  Financing is more commonly used when referring to for-profit enterprises, although it can be used in both for profit and non-profit enterprises. 

Funding

Funding is money provided to a business or non-profit for a particular purpose.  While both for-profit and non-profit organizations can use the term, it’s more commonly used in non-profit media that the term financing is. 

Revenue

Money that comes into an organization from providing shrives or selling/licensing goods.  Money from Distribution is revenue, whereas money from investors is financing, and donors tend to provide funding more than financing, although both terms could apply.

Equity

A percentage ownership in a company, project, or asset.  While it’s generally best to make sure all equity investors are paid back, so long as you’ve acted truthfully and fulfilled all your obligations it’s generally not something that you will forfeit your house over.  Stocks are the most common form of equity, although films tend not to be able to issue stocks for complicated regulatory reasons and the fact that films are generally considered a high-risk investment.

Donation

Money that is given in support of an organization, project, or cause without the expectation of repayment or an ownership stake in the organization.  Perks or gifts may be an obligation of the arrangement. 

Debt

A loan that must be paid back. Generally with interest.

Deferral

A payment put off to the future.  Deferrals generally have a trigger as to when the payment will be due.

“Soft Money"

In General, this refers to money you don’t have to pay back, or sometimes money paid back by design.  In the world of independent film, it’s most commonly used for donations and deferrals, tax incentives, and occasionally product placement. It can have other meanings depending on the context though.

Investor

Someone who has provided funding to your company, generally in the form of liquid capital (or money.)

Stakeholder

Someone with a significant stake in the outcome of an organization or project.  These can be investors, distributors, recognizable name talent, or high-level crew. 

Donor

Someone who has donated to your cause, project, or organization. 

Patron

Similar to donors, and can refer to high-level donors or financial backers on the website Patreon.  For examples of patrons, see below. you can be a patron for me and support the creation of content just like this by clicking below.

Non-Profit Organizations (NPO)

An organization dedicated to providing a good or service to a particular cause without the intent to profit from their actions, in the same way, a small business or corporation would. This designation often comes with significant tax benefits in the United States.

501c3

The most common type of non-profit entity file is to take advantage of non-profit tax exempt status in the US.

Non-Government Organization (NGO)

Similar to a non-profit, generally larger in scope.  Also, something of an antiquated term. 

Foundation

An organization providing funding to causes, organizations and projects without a promise of repayment or ownership.  Generally, these organizations will only provide funding to non profit organizations. Exceptions exist. 

Grantor

An organization that funds other organizations and projects in the form of grants.  Generally, these organizations are also foundations, but not necessarily.

Fiscal Sponsorship

A process through which a for-profit organization can fundraise with the same tax-exempt status as a 501c3.  In broad strokes, an accredited 501c3 takes in money on behalf of a for-profit company and then pays that money out less a fee.  Not all 501c3 organizations can act as a fiscal sponsor. 

Investment

Capital that has been or will be contributed to an organization in exchange for an equity stake, although it can also be structured as debt or promissory note.

Investment Deck (Often simply “Deck”)

A document providing a snapshot of the business of your project.  I recommend a 12-slide version, which can be found outlined in this blog or made from a template in the resources section of my site, linked below.

Related: Free Film Business Resource Package

Look Book

A creative snapshot of your project with a bit of business in it as well. NOT THE SAME AS A DECK.  There isn’t as much structure to this.  Check out the blog on that one below. 

Related: How to make a look book

Audience Analysis

One of 3 generally expected ways to project revenue for a film.  This one is based around understanding the spending power of your audience and creating a market share analysis based on that. I don’t yet have a blog on this one, but I will be dropping two videos about it later this month on my youtube channel.  Subscribe so you don’t miss them.

Competitive Analysis

One of 3 ways to project revenue for an independent film.  This method involves taking 20 films of a similar genre, attachments, and Intellectual property status and doing a lot of math to get the estimates you need. 

Sales Agency Estimates

One of 3 ways to project revenue for an independent film.  These are high and low estimates given to you by a sales agent.  They are often inflated.

Related: How to project Revenue for your Independent Film

Calendar Year

12 months beginning January 1 and ending December 31.  What we generally think of as, you know, a year. 

Fiscal year

The year observed by businesses. While each organization can specify its fiscal year, the term generally means October 1 to September 30 as that’s what many government organizations and large banks use.  Many educational institutions tie their fiscal year to the school year, and most small businesses have their fiscal year match the calendar year as it’s easier to keep up with on limited staff.

Film Distribution

The act of making a film available to the end user in a given territory or platform. 

International Sales

The act of selling a film to distributors around the world. 

Related: What's the difference between a sales agent and distributor?

Bonus! Some common general use Acronyms

YOY

Year over Year.  Commonly used in metrics for tracking marketing engagement or financial performance on a year-to-year basis.

YTD

Year to Date.  Commonly used in conjunction with Year over year metrics or to measure other things like revenue or profit/loss metrics.

MTD

Month to Date. Commonly used when comparing monthly revenue to measure sales performance. Due to the standard reporting cycles for distributors, you probably won’t see this much unless you self-distribute.

OOO

Out of Office.  It generally means the person can’t currently be reached. 

EOD

End of Day. Refers to the close of business that day, and generally means 5 PM on that particular day for whatever the time zone of the person using the term is working in.  

Thanks for reading this!  ​Please share it with your friends. If you want more content on film financing, packaging, marketing, distribution, entrepreneurialism, and all facets of the film industry, sign up for my mailing list! Not only will you get monthly content digests segmented by topic, but you’ll get a package of other resources to take you film from script to screen. Those resources include a free ebook, whitepaper, investment deck template, and more!

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How to Finance your Indie Film/Media Project in 2019

I predicted where the state of film industry finance was heading, mixed bag.

The year is starting to wrap up, so now’s a good time to plan for how to make your career skyrocket in 2019.  If you’re not developing a film, you should be.  But if you read last week’s blog outlining why we’re likely going to be looking at a recession in 2019, and what that means for the film industry then you might be understandably nervous as to how you’re going to get your work done.  So here’s my advice to you.

By the way, this blog is going to heavily build on last week’s blog.  If you haven’t yet, read it by clicking below.  I’m going to reference it a lot in this week’s blog.

Related: Where the Film Industry is Headed in 2019

Angel Investment Money will be Harder to Find but can be Easier to Close.

If I’m right about the impending recession, then it’s likely that investors are going to get skittish.    However, investors will likely need to put their money somewhere.  In an uncertain economy, the film industry becomes comparably less risky, so you might want to talk to your investors about how the risk profile of the investment has become slightly less risky than it was.  However, you’ll need to make sure you have a way to capture attention and get eyeballs on your film. 

It may well be that your investors kind of took a bath when the stock market takes a pretty massive hit.  If that’s the case, and it looks like their portfolio will bounce back then you should have them ask their broker about a portfolio loan.  The blog below will provide much more insight. 

Related: One Simple Trick to Reopen Conversations with Investors

Pre-Sale Money might become more Viable

Given that we discussed last week how SVOD and AVOD platforms are likely to come out of the recession with an increased market share, it’s more likely that they’re going to need to put up their own money to finance content to keep their pipelines full. 

That said, you’re going to need to develop a good package, and you’re going to need more than just a presale to finance your film.

Consider a Pivot to Episodic Content

As discussed in last week’s blog, if a recession hits, the film markets are likely going to be in more trouble than they already are.  Given that the way we generally consume content has shifted from the theater to binge-watching shows on platforms like Hulu and Netflix.  If you have the ability to get enough money together to get an entire season of TV content together you should consider it as an alternative to financing a feature.  That being said, I wouldn’t bother with a pilot.

If you can’t get 10-13 episodes of TV content together, then you should consider a web series.  It’s easier to guarantee distribution, and if you do the web series fest circuit, you can build enough buzz to get a strong series deal out of it.  Something similar happened with Diary of an Awkward Black Girl which turned into HBO’s Insecure.

I’m currently working on a blog post that dives into this in much more detail based on a segment from one of my workshops.  When it’s released, I’ll post it here. 

Tax Incentives may well go Down.

As the economy shrinks, states may feel the need to cut back on spending.  Often, the arts are one of the first places where deep cuts are felt, especially in red states.  So if you’re planning on using a tax incentive to finance your film once the recession hits, you may want to reconsider.  I’ll admit, this one involves a lot more speculation than most of the others. 

Grants may be Tricky.

If you were counting on a grant for your film to get funded, you may be in a rough spot since when people have to tighten their belts, charitable giving tends to go way down.  This isn’t certain though.  Some larger foundations are likely going to be able to weather a few years in a bad economy before taking some big cuts. 

Now Could be a Good Time to make your First Feature

If you can make your first feature for a very small amount of money, now might be a good time. You’re likely going to have the time to kill, and some of your contacts who tend to work on corporate videos may be less busy than they were due to the recession.

If you decide to go this way, I would make sure you make a film that can be profitable on SVOD and AVOD alone, and that you spend time developing and engaging with your following across all platforms. When money is tight, it’s much easier to convince someone to watch your movie on Amazon than it is to convince them to buy it.

If you’ve made a low-budget film, and gotten it reasonably widely known and distributed, then you’ll be in a much better position to get investment when the economy bounces back.

Thank you so much for reading, and I hope you’re having a wonderful holiday. Come back next week for my final part in this 3 part series, the Hot and Not Genres of 2019!​

In the meantime, check out my mailing list!  You’ll get lots of great goodies, including blog digests organized by topic, an AFM Resources Packet, and money saving resources for film markets and festivals.

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Filmmakers! - 5 Steps to Successful Grantwriting

People say grant writing is hard, but it’s more straightforward than you think. Here’s a primer.

A few months ago I worked with the absolutely lovely Joanne Butcher of Filmmaker Success to put on an educational event about grant writing here in San Francisco.  Joanne has raised millions in grant funding for several non-profits over the course of her life.  While I can’t distill everything from her talk into a single blog, I can give the people who weren’t able to make it some of the key takeaways.  So without further ado, here are the 5 rules for applying for grants.

1. Research

This might just be a Guerrilla Rep Media Rule of life at this point.  If you understand the field you’re playing on, you’re going to be much better at whatever game you’re going to play there.  The only way you understand that field is by researching it. But I digress. 

When applying for grants, the first step is to research and find grants to apply to.  (Duh) Focus on grants that match the subject matter of your film. It’s best to only apply for grants you’re perfect for, even if they are not directly related to filmmaking.  

The fact is that no one can apply to the thousands of grants they are eligible for is why limiting to the perfect matches is going to greatly increase your success.  It’s almost always a bad idea to bend something to fit a grant application. The key here is to remove the mindset of scarcity, and instead focus on finding the right fit.

As an example, if we were looking for funding for a reboot of The Little Mermaid, Joanne would recommend looking into marine science foundations, climate change foundations, and local artist grants, local filmmaking grants, or since it’s based on a Hans Christian Andersen book, even Denmark’s Cultural heritage foundations might be worth applying to.  

This article is a good place to start for your research.

FILMDAILY.TV'S GRANT LIST

2.   Set a goal for applications

Set an achievable goal for grants you want to apply for.  A safe bet is one per month. This would put applying for grants as a heavy part-time job for you though.

It can be hard to find relevant grants to apply to get up to 1 per week, so you should consider applying to grants that are thematically related to your content, as opposed to strictly applying for film grants.  What I mean by this is if your film is about homelessness, then maybe apply for grants from organizations helping the homeless, stating how you can help increase the awareness and impact of their foundation through the power of motion pictures.  ​

3.   Answer the Questions

Now that you’ve researched to find relevant grants, and you’ve set your goals, it’s time to start grant writing!  I know that sounds super intimidating, but really it’s just answering a very long series of questions. 

Although when you’re answering your questions, you should remember that it’s more than just providing information.  Your goal here is to sell the grantor on why your project is the one that will get the most bang for their funders buck.  

Every funder’s primary responsibility is to fund the projects that provide the most value to the foundation.  Generally, this means the projects that get the most eyeballs on them, and offer the most benefits to the communities that particular funder serves.  Your job is to convince that funder that your project is the one that will do that. 

4.   Hit Send

I know this sounds rather obvious, but once you’ve written your grant you need to press send.  However, a lot of filmmakers get stuck at this step, and spend so much time perfecting their application that they either miss the deadline, or could have applied to a whole different grant in the time they spent making one of them about 2% better.  Hit send, and start applying for the next one. 

5.  Apply Again Next Year

Finally, the first time that you apply for a grant, don’t be put off if you don’t get it..  Most funders get far more applications than they have money to fund, and competition is fierce..  That doesn’t mean you shouldn’t apply, it just means that you need to keep applying, and, over time, improve both your proposals, your projects and your relationships with the funders.  “After all, says Joanne, “you can’t apply a second time until you’ve applied for a first.”

IF you’re a filmmaker, you’re always likely to have some project that will require funding.  Thus, relationships with funders will be very important to your long term career. By applying for film grants, you start to develop a relationship with the grantor, even if your grant applications are unsuccessful.

Also, if you’re declined, you can actually call up the funder, and ask why.  Most times, grantors will share some insight as to why your application was declined.  Doing this can put you in a much better position to get the grant next year. Just don’t be rude when you do; the point is to build a positive relationship

Thanks so much for reading!  I’d heavily encourage you to check out Joanne Butcher’s website below.  Also, check out the free indiefilm resource pack for EXCLUSIVE templates and tools to help you finance your film, as well as a monthly blog digest to help answer any questions that you may end up needing to fill out your grant proposal.

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The 9 Ways to Finance an Indiependent Film

There’s more than one way to finance an independent film. It’s not all about finding investors. Here’s a breakdown of alternative indie film funding sources.

A lot of Filmmakers are only concerned with finding investors for their projects. While films require money to be made well, there’s are better ways to find that money than convincing a rich person to part with a few hundred thousand dollars. Even if you are able to get an angel investor (or a few ) on board, it’s often not in your best interest to raise your budget solely from private equity, as the more you raise the less likely it is you’ll ever see money from the back end of your project.

Would you Rather Watch or Listen than Read? I made a video on this topic for my YouTube Channel.

So here’s a very top-level guide to how you may want to structure your financial mix. The mixes in the image above loosely correspond to the financial mix of a first-time film, a tested filmmaker’s film, and a documentary. They’re also loose guidelines, and by no means apply to every situation, and should not be considered financial or legal advice under any circumstance. This is just the general experience of one Executive producer.

Piece 1 — Skin in the game. 10–20%

Investors want you to be risking something other than your time. The theory is that it makes you more likely to be responsible with their money if you put some of yours at risk. This can be from friends and family, but they prefer it come directly from your pocket.

I've gotten a lot of flack for this.  However, the fact investors want skin in the game is true for any industry or any business.  Tech companies normally have skin in the game from the founders as well, not just time, code, or intellectual property.

However, if you’ve got a mountain of student debt and no rich relatives, then there is another way…

Piece 2 — Crowdfunding 10–20%

I know filmmakers don’t like hearing that they’ll need to crowdfund. I understand it’s not an easy thing to do. I’ve raised some money on Kickstarter and can verify that It’s a full-time job during the campaign if you want to do it successfully. However, if you can hit your goal, not only will you be able to put some skin in the game, and retain more creative control and more of the back end but you’ll also provide verifiable proof that there’s a market for you and your work. Investors look very kindly on this.

That said, just as success provides strong market validation as a proof of concept, failing to raise your funding can also be seen as a failure of concept. and make it more difficult to raise than it would otherwise have been. Make sure you only bite off what you can chew.

Due to the difficulty in finding money for an independent film, the skin in the game or crowdfunding portion of the raise for a director’s first project is often a much higher percentage of the raise than it will be for their future projects.

Piece 3 — Equity 20–40%

Next up is equity. This is when an investor gives you money in return for an ownership stake in the company. From a filmmaker's perspective, it’s good in that if everything goes tits up, you don’t owe the investors their money back. Don't misunderstand what I mean by this.  You ABSOLUTELY have a fiduciary responsibility to do your due diligence and act in the best interest of your investors to do absolutely everything in your power to make it so they recoup their investment.  If you do that, or if you commit fraud, your investors can and likely will sue the pants off of you. You’ll have an uphill battle on that as well since they probably have more money for legal fees than you do.

Also, you will need a lawyer to help you draft a PPM.  You shouldn't raise any kind of money on this list without a lawyer, with the possible exception of donation-based crowdfunding or grants.  In general, just remember that I’m a dude who produced a bunch of movies who writes blogs and makes videos on the internet. Not a lawyer or financial advisor. #Notlegaladvice #Notfinancialdvice #mylawyermakesmewritethesesnippets.

It’s bad in that if everything goes extremely well, they get a huge percentage of your film. So it deserves a place in your financial mix, but ideally a small one.

For a longer list of my feelings on this topic, check out Why film needs Venture Capitalor One Simple Tool to Reopen Conversations with Investors

Piece 4 — Product Placement 10–20%

Product placement is when you get a brand to compensate you for including their product in your film. It’s more common in the form of donations or loans for use than hard money, but both can happen with talent and assured distribution. If you’re a first-timer, it’s difficult to get anything other than donated or loaned products.

Piece 5 — Presale Backed Debt 0–20%

Everything you read tells you the presale market has dried up. To a certain degree, that is true. However, it’s more convoluted than you may think. According to Jonathan Wolfe of the American Film Market, the presale market has a tendency to ebb and flow with the rise and fall of private equity in the filmmaking marketplace. There’s been a glut of equity for the past several years that’s quickly drying up.

 That said, there are a lot of other factors that will determine where pre-sales end up in a few years. The form has shifted, in that it’s generally reputable sales agents that give the letters instead of buyers and territorial distributors. You then take that letter to a bank where you can borrow against it at a relatively low rate.

Piece 6 — Tax incentives 10%-20%

While many states have cut their filmmaking tax incentives, it’s still a very viable way to cover some of the costs of making your project. It is worth noting that the tax incentive money is generally given as a letter of credit, which you can then borrow against or sell to a brokerage agency. It’s not just a check from the state or country you’re shooting in. This system of finance is significantly more viable in Europe than it is in the US, but no matter where you plan on shooting it needs to be part of your financial mix.

Piece 7 — Grants 0–20%

There are still filmmaking grants that can help you to make your project. However, that’s not something that is available to all filmmakers, especially when they’re first making their projects. Don’t think grants don’t exist for you and your project, because they probably do, spend an afternoon googling it. My friend Joanne Butcher of www.FilmmakerSuccess.com suggests applying for one grand a month for the indefinite future, as when you do so you’ll develop relationships with the foundations you contact which can be invaluable for your career growth.

Grants are much easier to get as a completion fund once you’ve shot your film. Additionally, films made overseas are more likely to be funded by grants than those shot here in the US.

Piece 8 — Gap/Unsecured Debt 10–40%

Gap debt is an unsecured loan used to create a film or television series. This means that the loan has no collateral, be it product placement, Presale, or tax incentive. It used to be handled by entertainment banks for a very high interest rate, I can’t say who my source was on this, but I have heard of interest rates in excess of 50% APR. That market has been largely taken over by private investors loaning money through slated, which did bring interest rates down. Unsecured debt almost certainly requires a completion bond, which generally means that it’s only suitable for projects over 1mm USD in budget.

In general, you should use this form of financing as little as possible, and pay it back as quickly as possible. Again, Not legal or financial advice.

Piece 9 — Soft money and Deferments — whatever you can

Soft money is funding that isn’t given as cash. This can be your crew taking deferred payment for their services, or receiving donated or loaned products, locations, and anything else meant to get your film made. This isn’t so much funding as cost-cutting. It often includes donations or loans from product placement.

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