7 Actionable Steps to Raise In-Kind Donations for your Indiefilm.

Filmmaking is HARD.  Making your first movie is even harder.  You have to gather all of the stuff you need to make your movie, often working with funds that you’ve saved up yourself.  Sometimes you’ll have some additional funds from your friends and family, an inheritance, crowdfunding or some other windfall, but even with any or all of those funding is likely to be tight.  

So as part of my ongoing efforts to make filmmaking easier, here’s an entry-level guide to getting in-kind donations for your film.  

Try to get fiscal sponsorship

Fiscal sponsorship is essentially an arrangement where a non-profit organization lets you borrow their tax deductible status for the purposes of taking in donations.  If you can get fiscal sponsorship from a reputable 501C-3 non-profit organization, any donations you take in will be considered tax deductible.

Generally, the non-profit will take a fee as part of letting you use their 501C-3 status.  Most of the time, this fee is somewhere around 9-10%.  How this will apply to in kind donations is something you’ll have to work out with the organization from which you seek fiscal sponsorship.

Being able to solicit donations as tax deductions from local businesses makes it much easier to convert them as it gives them an additional incentive to help you.  

Consider what products could appear on screen.

In order to figure out what you might be able to get donated, you first must discern what you need.  Go to your Day out of Days report (DOOD) and check out what might be the most likely elements you could get a donation for.  You can work from these lists for the next steps.

Figure out where you can get what you need.

Once you have a list of what you’ll need, it’s time to figure out where you can get it. First, cross off the stuff you already have. Make a list of 3 potential places you could procure any of the items on your list then move on to the next step.

You’ll have to spend some money on your production, this extension can help you save.  

Before we go into how to get free stuff for your movie, it’s important to remember that sometimes the wise move is to spend a little bit of money to save a lot of time.  For those situations, This Chrome extension can help you find the best deals on a lot.of things you’ll buy anyway.  Check, it out here.    

Approach local businesses about donations.

You can approach the 3 businesses to see if they’ll discount, donate, or loan you the items you need. 

They’ll be a lot more likely to donate to you if you have the fiscal sponsorship.  If you’re a student, you should definitely say so, as it makes them even more likely to donate what you need to make your film.  

While mom-and-pop stores are easier to approach, many large chains have some level of budget for these sorts of donations.  Grocery stores normally have something they can give away to non-profits, and this can be a great way to cut your craft services budget.

Don’t be afraid to call major brands, but don’t expect too much 

If you’re bold, you could approach a major brand about getting some in-kind donations for your movie.  This could be getting Starbucks to donate a bunch of beans for craft services, or Mercedes letting you use a car from a dealership for a day.  If you do this, you should be aware that the chances for success are not as high as approaching a mom and pop shop, but the potential rewards can be huge.

Just keep in mind, if you are trying to get something from a local store in a massive conglomerate, it can be easier to go into that store first.  A lot of brands are looking for ways to increase visibility, sometimes directly, and sometimes through third-party brokers.

In fact, according to a study from hubspot 60% businesses small and large have stated that they rely heavily on micro and nano influencers to build trust in those brands. For the uninitiated, nano influencers have 5,000 subscribers or fewer and micro influencers have 50,000 subscribers. It’s not exactly the same space, but it’s a similar one.

Keep Track of everything you’ve raised.

Getting Donations will increase the Production Value of your film, and you should keep track of the value you’re adding. Not all budgeting platforms can track this in line, but you should keep a separate tally somewhere.  Eventually, a distributor will ask you what your budget was and you should include your in-kind efforts.

Thanks for reading, and we hope you found this article useful.  It you want more film business content, check out my free film business resource pack!  

3 Things Every New Film Investor NEEDS to know

I write a lot about the film business with filmmakers as a target audience.  However, in my non-educational content job, I have to interface with film investors on a fairly regular basis.  This blog is adapted from one such situation where a first-time film investor had a lot of impulses that might actually hurt their film.  The response got rather lengthy, so I asked my client if he minded if I adapt it into a blog.  The client didn’t mind at all, so now I can share the insights with him with significantly more people.

With that in mind, here are 3 things that every new film investor should know. 

1. Films are not evergreen.

Once a film is more than a year past its initial release, it loses a significant portion of its perceived market value.   Buyers just won’t touch it.  You released the film this year, so you have a bit of time, but that time is not infinite.  This means that negotiations around a minimum amount of money over time is not always productive, as it will likely be out of the highest actual period no matter what happens.  Often, even if you get the rights back, the film will have been so heavily shopped no one will take a look at it anyway.

This is a mistake that a lot of filmmakers make.  Unfortunately, you do not have all the time in the world to shop for your film.  Eventually, you’ll want to make sure you get it out there, even if it’s at something of a loss.  If you want longer, it’s unlikely that your prospects will get better.  

Of course, I want to be clear that you shouldn’t take any old deal as soon as it’s offered.  It’s just important to remember that barring some incredibly specific extenuating circumstances,  your film won’t be worth as much next year as it is now.  Your Also, if the distributor or sales agent is in clear breach, you should still try to get your rights back. 

2. Generally, films take a few markets to make a cash upfront sale, and the pay chain is absurd.  

It often takes a few in-person touchpoints before the sale is finalized.  While I’m going to be pushing for a quick sale, sometimes it takes a while for the money to come through.   

Further, you should remember that a lot of time it will take a while for those payments to trickle through to the producer.  I’ve outlined the issue in detail in the blog below, but to give you an idea, an MG-oriented sale will likely have something like 10% due on signing, 40% due within 30-90 days from notice of delivery, and the remaining 50% due prior to release or within 30 days of release.  Also, most SVOD sales in the US pay out a set amount of time after the beginning of the license period.  

Related:The problems with the indie film distribution payment system.

3.  No one likes dealing with inexperienced people with huge egos.

If you’re an accredited investor, you’ve probably dealt with this issue on the other end.  You likely have money due to your own entrepreneurial endeavors, a high-paying position that likely required you to employ other people, an expansive portfolio of investments that may have required you to interface directly with other entrepreneurs, or some combination of the above.  

While the primary goal of any film production should be to get all of your money back, the industry is incredibly specialized.  Nobody likes being told how to run their business by someone without much experience in the driver’s seat of this highly specialized industry.

It’s important to remember that once you get to dealing with more powerful members of the industry, trying to throw your weight around to get a better deal isn’t likely to break in your favor.  Unfortunately, most good sales agents or distributors will just decline to take out your film, and the less-than-good ones who remain will find legal ways to avoid paying out as long as possible if they pay out at all.   

This industry may be in a period of upheaval, but currently, sales agents and distributors still hold a lot of power.   So if you want to make a profitable film, or a widely distributed one, you’re going to have to take some time to understand the common industry practices.

It’s incredibly difficult to negotiate with someone when you’re at a massive informational disadvantage, and more than likely you will be at an informational disadvantage purely by the nature of the specialization of the film sales and distribution industry. 

If you want to lessen your informational disadvantage, you should sign up for my mailing list to get monthly blog digests segmented by topic, you’ll also get a free film business resource pack that includes an ebook, whitepaper on the macroeconomics of the film industry, an investment deck template, and a whole lot more!  Click the button below to grab it.  

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7 Things I Learned as CEO of a US Film Distributor

If you’re reading this, you might already know that I founded and lead a company called Mutiny Pictures.  That company has since sold to Bayview Entertainment. Given I’ve been a producer’s rep for quite a while, I thought I was prepared to step up to leading a team to take films to market directly, I found that while I was up to the task there was still quite a lot of personal growth involved for myself and every level of the team. This is to be expected out of any new venture.  Here are some of the biggest things that I personally learned throughout running a US Distribution company.  

(Almost) Nobody pays on time.

Filmmakers often complain about Sales agents and Distributors not paying on time.  While it goes without saying that there are a lot of shady, dishonest sales agents and distributors out there, I was surprised exactly how few reputable companies did not pay on time.  Given that when it comes to film distribution and international sales all stakeholders are part of the same waterfall or pay chain, if one stakeholder is paid late that eventually means that the filmmaker is paid late. We can’t pay you money we don’t have.   

So if you’re a filmmaker reading this, you should know that just because your sales agent is late on their reports doesn’t mean they’re not being honest with you.  It also doesn’t mean that they’re the reason you’re being paid late.  It’s entirely possible that possible their vendor, supplier, or other provider hasn’t paid them yet. 

That said, they should still communicate with you about when this is happening, and if they’re paying late you should still be tracking it as much as you can.  

Analytics and Reporting really, REALLY suck at every level of the distribution.

Given I do other forms of online and affiliate marketing and used to run marketing for a tech startup, I was utterly flabbergasted by the utter disgrace that is analytics around digital film marketing.  In most industries related to digital marketing, the insights are nearly immediate.  However, If you deal with a servicer or aggregator, they often won’t give you any level of real-time insight.  The best most do is once a week, which is nearly meaningly when it comes to agile marketing practices.  

I did find a workaround for my clients, so I’ll share it here.  If you’re a filmmaker and want better insights, sign up for the Amazon affiliate program and use those links to your film to market it. This is less about the few extra cents you get from pushing your work and more about real-time sales insights.  It can cause some issues around online postings and social media algorithms though, so it’s not a perfect system.  I’d love better suggestions in the comments if anyone has any.

Insurance and legal paperwork are way more of the job than you realize.

This wasn’t exactly a surprise.  At its core, film distribution and international sales are businesses based almost entirely around tracking rights and trading signatures on paper.  is entirely about buying and selling intangible rights restricted by non-physical attributes like territory, right types, region, and other highly specific terms of art.  It’s easy to mess this up, so it only makes sense to have solid insurance coverage.  What I didn’t expect was how many hours in my standard week were around litigious paperwork around insurance, compliance, reporting, and proposals, as opposed to growing the business. 

Additionally, you as a filmmaker will need to provide a lot of insurance paperwork.  

You have to pitch earlier than you think.

If you want to have a film on all major TVOD platforms, you generally need to have them pitched/placed 5-6 months ahead of the date.  You can do it in 3 months on a rush job.  This was surprising given I submitted my first book for publishing less than 3 days before it was available on Amazon.  If you sell to an SVOD outlet, they normally require delivery at least 3-6 months in advance as well, and they’ll either pay over the course of the license or a set period after the license begins.  

Payouts take longer than you think.

Reporting is one thing, payment is another.  Most platforms only pay quarterly, and they pay 30 days after the end of the quarter.  There has recently been an additional 90-day delay that was initially for COVID, but that seems to be less of an issue than it used to be.  Additionally, they won’t pay for partial quarters, meaning if you launched in February, you won’t get any data from a lot of platforms until August or even November. If there’s a service involved, you might get an additional 30-day delay.  

This makes it really hard to run a business, and the only thing you can really do is use a different aggregator or servicer.  You can supplement this with direct vendor payments from streamers and physical media outlets, but those are only getting more difficult to place.  There are very few companies that are occupying the servicer or aggregator space in the market, and unfortunately, the ones with the greatest physical reach tend to also have the worst reporting timelines.  

There’s a great amount of room for an aggregator with fast recording and greater ability for brick-and-mortar physical releases.  However, given the rapid decline of physical media, there might not be time for such a company to access that window before it closes forever.  

The industry still operates on a tentpole model.  

The sad truth of the matter is that on the ultra-low budget scale, only about 2 or 3 in 10 movies make money.  If your sales agency or distributor is made up of really good curators, you might be able to get that to 4 or even 5 out of 10.  If you’re hitting that high, most industry people will be amazed.   If you’re running a distribution company, this means you either need to be exceptionally picky and run a very lean company, or you need to take everything you can and see what sticks.  I’ve written another piece on this going into more detail. 

Producers get in their own way a lot.

I said earlier that it’s no secret that there are a lot of shady sales agents and distributors out there.  That said, not all filmmakers are saints either.  Some filmmakers are a complete joy to work with, but others will second guess everything you do and think that the only film that you should ever focus on is theirs.  

I had a filmmaker say precisely that to my face.  We got tons of press for this person, but nobody wanted to watch it and the film tanked.  When this filmmaker wasn’t getting the returns they expected they started taking up a ton of time in angry calls and emails.  This reduced A LOT of my available time to actually get their film out there, which further impacted the returns and became a vicious cycle.  

Marketing a movie is best when it’s a partnership between the filmmakers and the distributor.  In general, you should discuss when you’re making any level of announcement with your distributor so that it can make the biggest possible splash.  It’s generally unwise to drop assets like posets and trailers without talking to your distributor, as you may ruin potential exclusive press drops.  Worse, if you put your film up in various territories through self-distribution channels, it could cost you thousands or tens of thousands of dollars in lost revenue.  Even if you can take a film down, most buyers won’t want it if it’s already been placed on any platforms in their region. I could go on about this for a while, so I’m going to leave it for another blog.  

This is a collaborative process, so they’re definitely give and take, but keep in mind there’s probably a reason you didn’t self-distribute and instead decided to work with your distributor.

In the end, this is a relationship business.  If your distributor likes you, they’re more likely to go the extra mile for you.  That’s a reality of human nature. If you want your distributor to like you, you might want to grab my free IndieFilm business resource package as it’s got lots of goodies to help make marketing your movie easier for all involved.  The resource pack got templates for contacting distributors, and tracking that contact so you don’t bug them, an e-book on the film business, and a whitepaper on the metrics of the film industry.  Plus, you’ll get monthly content digests to help you better understand the industry in a manageable way and occasion updates on new releases, courses, workshops, and announcements from Guerrilla Rep Media.  Check it out below.

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Filmmakers Glossary of Film Business Terminology.

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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22 Indiefilm Distribution Definitions Filmmakers NEED to know

If you’re going to read and understand your distribution agreement, then there’s some terminology you have to grasp first.  So with that in mind, here’s a breakdown of some key terminology you ABSOLUTELY need to know if you’re going to get traditional distribution for your film.

This is one of those blogs I should probably start out by saying that I’m not a lawyer.  Always talk to a lawyer when looking at a film or media distribution contract.  With that out of the way, I’d recommend we get started. 

1. License

At its core, a license for an independent film or media project is the right to exploit the content for financial gain.  Every other piece of a license agreement is clarifying the limitations of that license. 

2. Licensor

A licensor is a person or entity that is licensing a piece of media to another entity to either distribute or sub-distribute its content.  In general, this is the filmmaker when the filmmaker is dealing with a sales agent or producer’s rep, or the sales agent or producer’s rep when they’re dealing with distributors. 

3. Licensee

The License is the entity that is acquiring the content to distribute it and exploit it for financial gain.  In the instance of filmmakers and sales agents, it would be the sales agent, in the instance of sales agents and distributors, it would be the distributor. 

4.  Producer’s Representative (Producer’s Rep)

An agent who acts on behalf of a filmmaker or film to get the best possible sales and distribution deals. 

Related: What does a Producer’s Rep Actually do, anyway?

5.   Sales Agent

A Company that licenses films from sales agents or Producer’s Reps in order to sub-license the film to territorial distributors around the world.

6. Distributor

A company that directly exploits a film in a given territory on agreed upon media right types.

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

7. ​MG (Minimum Guarantee)

This is a huge one.  It’s the amount of money you get up front from a sales agent, or a sales agent receives from a distributor.  The biggest difference between this and a license fee is that at least in theory an MG has the potential to receive more in residual payments beyond the additional payment.  In practice, this is less common. 

8. License Fee

A license fee is a set amount of money paid by a distributor to exploit media in a defined territory and set of media rights.  Unlike a minimum guarantee, a License fee is the total amount of payment the licensor will receive over the course of the license, regardless of the financial success the film goes on to achieve.  License fees can be paid in one lump sum, or over the course of the license. 

9. ​Revenue Share

​Revenue share is the other most common way films can receive payment.  Revenue share essentially means that the licensee will split the revenue with the licensor according to an agreed-upon commission generally after they recoup their expenses. 

10. ​Producer’s Corridor

A producer’s corridor is an alternate payment waterfall of money a filmmaker is paid prior to the licensee recouping their expenses.  This generally means that the producer is paid from dollar one. 

11. Term

Term is the length of time a contract is in place.  For most independent film sales agency contracts, the term is generally 5-7 years. 

12. ​Region

The instances that generally apply to traditional distribution in the modern-day region refer to a set of territories in which a film can be distributed in. While they vary slightly from sales agency to sales agency, they are generally English Speaking, Europe, Latin America, Asia/Far East, and others.

13. ​Territory

When it comes to film distribution and international sales. territories are areas within a region that add greater specificity to where a sales agent can parse rights.  Latin America is both a region and a territory.

14. Media Rights

The sorts of media that a distributor has to exploit in a given territory or set of territories. 

Related: Indiefilm Media Right types

15. Benelux

A territory consisting of Belgium, the Netherlands, and Luxembourg. 

16. Four-Wall

The act of renting theaters in order to screen your film in them.  It generally involves a not insignificant upfront fee, and as a result, all money returns to the licensor. 

17. Community Screening

An alternative to a theatrical run for films with a strong niche or cause.  See below for more information. 

Related: How Community Screenings can replace a Theatrical Run

Related: 9 Essential Elements of Independent Film Community Screening Package

18. Payment Waterfall

When it comes to independent film distribution agreements, a payment waterfall is contractual representation How many flows from stakeholder to stakeholder?  If there is a producer’s corridor or some other non-standard modifications of a license agreement, there may be more than one waterfall in said contract. 

Related: IndieFilm Distribution Payment Waterfalls 101

19. Collection Account

​​A collection account is an account that a sales agent pays into which pays out all other stakeholders according to a pre-defined set of parameters.

20. ​Reports

In the context of independent film distribution and international sales agreements, a report is a statement made monthly, quarterly, bi-annually, or annually that states all incomes and expenses for a film.  Generally, this is accompanied by a check one is due.

21. Payment Threshold

When it comes to film and media distribution, a payment threshold is a minimum payment owed by a licensee in order to issue a payment to a licensee.  This payment amount is generally dependent on what payment method is being utilized.  For instance, the minimum is for a wire transfer is generally higher than a check which in turn is generally higher than for a direct deposit. 

22. Recoupable Expense

A recoupable expense is an investment made into marketing or distribution-related expenses by a licensee.  This investment will need to be paid back before the licensee pays the licensor, with the notable exception of the producer’s corridor.  Generally, these investments will fall into one of 3 categories of capped, uncapped, and uncovered expenses.   For more information, please check out the blog below. 

Related: What are recoupable expenses?

BONUS! - Expense Cap

An expense cap is a cap on the total amount of expenses that a licensee is able to take out before paying the licensor. There are exceptions, see the related link above for more information.

Thank you so much for reading the glossary! I hope it’s Helpful. If this is all intimidating and you need a little help, consider hiring a professional to assist you in the process.  So you could consider checking out Guerrilla Rep Media’s services. These blogs Blogs are largely a public service and marketing tool for me, most of my business is from representing and consulting with filmmakers just like you.  You can learn more and submit your film via the link below.  Or, if you're not ready for that, but want to support more content like this, join my email list to stay up to date on new offerings and get an awesome film business resource package while you’re there.

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What is a Recoupable Expense in Independent Film Distribution?

Filmmakers Ask me about Recoupable Expenses all the time.  A lot of filmmakers think that recoupable expenses mean money they have to pay.  Except in some VERY limited circumstances, that’s not the case.

A recoupable expense is simply an expense that a distributor or sales agent fronts to your film.  Another way of looking at this is that your distributor is your last investor, as they’re putting in a zero-interest loan in the form of paying for fees and services necessary to take the film to market. Most of the time, the distributor will need to get that money back before they start paying the filmmaker.  Distributors and sales agents have businesses to run and generally put money into anywhere between 24 and 60 films every year.  Without the ability to recoup what we put in, distributors would not be able to continue to invest in new films.

Before we really get into what each type of recoupable expense is.  There are generally 2 or 3 types.  Capped, uncapped, and Uncovered Expenses.  Here’s what they mean.

Capped Expenses

These are expenses that fall into a cap that cannot be exceeded by the distributor.  It’s normally a total cap that encompasses all expenses listed in an appendix.  If the expense is listed as capped, it is generally a total cap, not an individual cap.  A lot of filmmakers ask for individual caps but most distributors won’t do that. We did at Mutiny for the sake of transparency, but probably caused more problems than it solved due to confusion around the expense system.

Generally, there’s a reserve for capped expenses that often just ends up being the total amount of the expense cap.  This should be too bad as most of the capped expenses will be spent getting the film ready to take to market. 

Examples of Capped Expenses

This is not meant to be a complete list, but it is some of the most common examples. (I did take these from my Appendix B, but I added a few.)

Key Art Generation
DVD Art Generation
DVD Menu Generation
Trailer Generation
Aggregation fees
M.O.D. Listing Fees
ISBN listing fees
Publicity fees (generally Cross Collateralized with other clients at the same stage.)
Social Media Advertising
Market Fees. 
Minimum Guarantee (If Any)

These are all parts of bringing a film to market that are largely unavoidable.  Personally, I don’t spend the money if I don’t need to.  Like, if the film has a phenomenal trailer and key art, I don’t make new key art or cut a new trailer.  As a result, I don’t charge for those expenses.  This decision is solely at the discretion of the distributor, generally speaking.   Also, this is very much the rarity. 

Market fees will often be on the recoupable expenses (They’re not on mine, but that’s another story.) However, if they are there they should definitely be cross collateralized.  No single film should bear the total cost of market fees for a slate. 

Uncapped Expenses

Uncapped expenses are exactly what they sound like they are. That said, they’re not necessarily as scary as they sound like they are, providing that you’re not dealing with a predatory sales agent or distributor. Expenses a distributor covers but are not subject to caps.  These expenses are generally things that you’d often want to go higher, as it means more sales are being made.  Look at the examples below. 

Examples of Uncapped Expenses.

Again, this is not a complete list. 

Physical Media Replication.
DCP Generation.
Errors and Omissions Insurance (as needed)
Any expense outlined in As Needed deliverables. 
4-Walled Theaters (Upon Mutual Agreement in Writing)

In order to replicate more DVDs & Blu-Rays, a distributor must be selling them.  You want them to do that.  In order to generate more DCPs the Distributor must be booking theaters, which is generally a good thing.  Errors and Omissions insurance is generally only required for large PayTV or SVOD deals (like Netflix, Hulu, Starz, Showtime, and HBO) or broadcast deals.  As such, if you need E&O you probably got a big SVOD or Broadcast deal. ​​

Related: Indiefilm Media Right Types

Regarding needed Deliverables, there are some deliverables that a re only needed in very limited circumstances like Beta Tapes, and others.  There are reasons for each of them, but they get added beyond the cap as they’re difficult to anticipate.   Here’s the relevant section of a series I wrote on distribution deliverables.  

Related: Distribution Deliverables 4/4 - As Needed Deliverables. 

Uncovered Expenses​

Uncovered expenses is generally anything not listed in the appendix, although some expenses may not be covered like the 4-Walled Theaters listed above.  These are expenses that the filmmaker may be invoiced for.  They are rare, and the filmmaker SHOULD have advance notice of them.

​Some exceptions

For a long time I thought the term “Recoupable expense” was self-explanatory, but given all the questions I’ve gotten about it, I thought I would make sure it was said completely plain. As stated right at the top, most of the time, the filmmaker is not liable for unrecouped expenses. There are two primary exceptions. The first is the uncovered expenses above, where filmmakers will be invoiced immediately. This is rare, and generally VERY transparent. If it’s not, that’s another issue.

The other exception is generally if the filmmaker tries to take the film back prior to the close of the full term of the contract while expenses remain to be recouped. That's also normally spelled out in a contract. 

Thanks for Reading! As you can see, writing blogs and creating content is not my only (or even my primary job.) I also represent movies for sales and distribution. If you’d like me to consider yours, use the services button below. If you want to continue to reap the benefits of this free knowledge, grab my free indiefilm business resource package! some free resources, join my mailing list. You’ll get free blog digests that are like a topical e-book in your inbox every month, as well as templates to help you prep for festivals and investors or track your contact with sales agents, an actual e-book, and a whitepaper. That one is the lowest button

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The Problem with the IndieFilm Distribution Payment System

A lot of filmmakers I’ve worked with don’t know enough about distribution to really make a career making creative content.  This shouldn’t be a surprise, as it’s something film schools tend not to teach.  That being said, there’s a part of the equation most people just don’t talk about, and WHY it takes so long for filmmakers to get paid?  This blog addresses that.

As an aside, this is laid out from a financial perspective in the blog below.  However, we will also be tracking how much of the money goes away throughout this blog.  This will admittedly be very much oversimplified, but we’re going to be tracking it as a single dollar for ease of understanding. 

Related: Indiefilm Waterfalls 101

How long it takes for the platform to pay the aggregator

I talk about this in workshops quite frequently, but each different stakeholder takes a while to pay the next person in the pay chain.  Most of the time, this starts with the platform and aggregator relationship.  In general, this is the first section in the chain. 

Normally, the platform will take 30%-35%. This should include credit card processing fees.  So if the consumer gave 1 dollar, then we’re down to 65-70 cents. 

While exceptions exist, the platform most often pays the aggregator on a monthly basis.  After that, the aggregator will need to pay the distributor.  If you’re self-distributing, that distributor is you, but not all aggregators will deal with you in the fashion you’d prefer, for more information, read the blog below.
​

RELATED: What platforms should I release on?

How long it takes for the aggregator to pay the distributor

Once the aggregator is paid, the money will flow to the distributor.  As I stated, this may be you.  Depending on what aggregator the distributor is using, payments will be either monthly or quarterly.  Sometimes the aggregators that pay quarterly have lower overheads, so it might make sense to wait.  That said, I think the most current data you can get is necessary to make smart marketing decisions.
​

If you still don’t know the difference between a sales agent and a distributor, check the link below. Most aggregators operate on more of a flat fee model, so we’ll assume that the money is passed through.  If you worked with an aggregator, you end up with about .70 cents for every dollar the consumer spent, but you also probably had to put the aggregation fees in yourself, so you’ll probably need to sell around 2100 copies (assuming they sell for 2.99 each) to break even.  You’ll also get insights within 2 to 4 months.

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

How long it takes for the Distributor to pay the Sales Agent

Most distributors don’t deal with filmmakers directly.  They’ll either deal with a Producer’s Rep or a Sales Agent.  Generally, Distributors pay quarterly to start and sometimes will move more towards bi-annually after a few years.  This can be arduous, but it’s very difficult to negotiate.

Generally, the distributor will take 30-40%.  (As of publishing this, I take 25% for direct US Distribution.) So of the 65-70 cents, we had after the platform.  That means that after the distributor takes their cut, there are between .39 and .49 cents left to the filmmaker.  (or around .52 cents if you work with me)

Also, even though I am a distributor, I work directly with filmmakers. So you’d keep .52 cents on the dollar, and be paid around 4-5 months after the initial sale is made.  (I time my reports to work with my aggregator to minimize wait times.  Plus, I cover aggregation and the majority of marketing and publicity fees.
​

Related: What does a producer’s rep do anyway?

How long it takes for the Sales agent to pay the production company

Finally, the sales agent pays the Producer’s Rep and production company. This is also generally on a quarterly or Bi-Annual basis, although there’s more room for variation here. After that, the filmmaker uses the money to pay back debts, then investors, then whoever else is left to pay back from the production.   

The Sales Agent normally takes between 20% and 30%, but they sell territories across the globe. A Producer’s Rep will normally take 10% of the money paid to the filmmaker, and will normally be paid in line with the sales agent.

So, following the chain we talked about before, by the time the sales agent pays the filmmaker, we’re looking at between .27 and .39 cents on the dollar without a producer’s rep, or between .24 cents and .35 cents with one. That’s not a great representation of what a good producer’s rep will do for you though.  (including the potential to get you paid immediately from the first sale) I’ve painted these deals in the most simple possible light to help you understand, but there are lots of single-line items that can screw you if you’re not careful.  So, while the producer’s rep may take a small piece of the pie, (.03 to .04 cents on the total dollar) they can help you make the whole pie a fair amount bigger.

Thanks so much for reading! If you have any questions for me, you might want to check out my mailing list. I send out monthly blog digests including ones JUST LIKE THIS, plus you get lots of great resources like templates, links to money-saving resources, and a whole lot more!   Or, if you’ve got a completed project and you’re looking for distribution, submit it using the link below. You can also learn more about services for early-stage projects using the other link. I’ll review it and reach out soon.

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The 4 Stages of Indiefilm Finance (And Where to Find the Money)

Most of the time filmmakers seek to raise their investment round in one go.  A lot of people think that’s just how it’s done. As such, they ask would they try anything else. If you have a route into old film industry money you can go right ahead and raise money the old way. If you don’t, you might want to consider other options.

Just as filmmakers shouldn’t only look for equity when raising money, Filmmakers should consider the possibility of raising money in stages.  Here are the 4 best stages I’ve seen, and some ideas on where you can get the money for each stage.

1. Development

If you want to raise any significant amount of money, you’re going to need a good package.  But even the act of getting that package together requires some money.  So one solution to getting your film made is to raise a small development round prior to raising a much larger Production round. 

If you want to do this with any degree of success, you’re going to have to incentivize development round investors in some way.  There are many ways you can do it, but they fall well beyond my word count restrictions for these sorts of blogs.  If you’d like, you can use the link at the end of the blog to set up a strategy session so we can talk about your production, and what may or may not be appropriate. 
​

Related: 7 Essential Elements of an IndieFilm Package

Most often, your development round will be largely friends and family, skin in the game, equity, or crowdfunding.  Grants also work, but they’re HIGHLY competitive at this stage. 

Books on Indiefilm Business Plans

2. Pre-Production/Production

It generally doesn’t make sense to raise solely for pre-production, so you should raise money for both pre-production and principal photography.  This raise is generally far larger than the others, as it will be paying for about 70-80% of the total fundraising.  It can sometimes be combined with your post-production raise, but in the event there’s a small shortfall you can do a later completion funding raise. 

It’s very important to think about where you get the money for the film.  You shouldn’t be looking solely at Equity for your Raise.  For this round, you should be looking at Tax incentives, equity, Minor Grant funding if applicable, Soft Money, and PreSale Debt if you can get it. 

Related: The 9 Ways to Finance an Independent Film

Post Production/Completion

Some say that post-production is where the film goes to die.  If you don’t plan on an ancillary raise, then too often those people are right.  Generally you’ll need to make sure you have around 20-25% of your total budget for post.  It’s better if you can raise this round concurrently with your round for Pre-Production and Principle Photography

The best places to find completion money are grants, equity, backed debt, and gap debt

4. Distribution Funding/P&A

It’s very surprising to me how difficult it is to raise for this round, as it’s very much the least risky round for an investor, since the film is already done.

Theres a strong chance your distributor will cover most of this, but in the event that they don’t, you’ll need to allocate money for it. Generally, I say that if you’re raising the funds for distribution yourself, you should plan on at least 10% of the total budget of the film being used for distribution.

Generally you’ll find money for this in the following places. Grants, equity, backed debt, and gap debt.

If you like this article but still have questions, you should consider joining my email list.  You’ll get a free e-book, monthly digests of articles just like this, segmented by topic, as well as some great discounts, special offers, and a whole section of my site with FREE Filmmaking resources ONLY open to people on my email list.  Check it out!

9 Things I Learned from my First Theatrical Release

We recently came to the close of the theatrical release of Rockhaven Film’s Goodland.  It played in a total of 7 cities.  This was the first time I’ve been a key part of making a theatrical release work, so I wanted to share some of what I learned along the way.  So here it is 9 things I learned from my first theatrical release.

1. Booking theaters is both expensive and time-consuming

I tried booking a theater here in San Francisco, but in the end, I was unsuccessful.  The only theater that really got back to us would only show the film on a rental, not a revenue share.  We didn’t pay any of the other theaters, and we weren’t going to start in San Francisco. 

If we had paid them, it would have been a bit over 2,000 for 9 showings in a week.  It is possible to get some films in there on revenue share alone, but if you do you often must give up the first 2-3,000 in sales directly to the theater, and generally, that’s about all you’ll make from a screen unless you can really pound the pavement and get press coverage. 

2. Book local theaters, New York, and Los Angeles first. 

This contradicts some of what I just said, but when you’re getting started, the first theaters you need to book are New York, Los Angeles, and perhaps the screen most local to the filmmakers.   New York and LA get you more press coverage and give legitimacy to your theatrical run.  The local screen is generally the easiest to book.

​3. You don’t always need a full week’s run.

We only did 3 screenings in Buffalo, NY, but we still got a decent amount of press and a good amount of social media attention.  Doing 1-3 screenings in a market makes it feel more like an event, and is a great way to build word of mouth about your film.  Even if you can’t book a full week, consider booking a few one-night-only engagements to boost your presence in markets across the country. 

4. ​Often, 1-2 shows a day is easier to sell.

We had 3-5 screenings a day in Kansas City, and it was difficult to drive traffic to any one particular screening.  That includes the screenings we had with Q&As after them.  If you focus on one individual showing a day, it’s easier to focus your marketing efforts, and get those butts in seats for an indie movie.

5. Fewer theaters are independently owned than you think

In attempting to book theaters in San Francisco, I found that only a few local theaters were independently owned.  More theaters than you think are owned by mega chains like AMC, Cinemark, United Artists, and Landmark.  If you’re dealing with these mega-chains, you’re likely going to have to deal with their buyers.  Generally, those buyers will only want to deal with distributors. 
​

6. Once a theater is booked you can still get bumped unless you paid the rental fee.  

We booked a screen in New York for the same day we opened in LA.  Unfortunately, we were bumped because Avengers, Infinity War outperformed expectations.  If possible, don’t try to book your indie in May, June, July, August, November, or December.  That’s when Hollywood will be very likely to bump you.

7. Keep Making Noise to fill seats

Once you get your theaters booked, you’re still going to have to drive local people to theaters.  The most cost-effective ways to do this are via local press coverage and social media.  The two work very well together.  Keep your audience engaged by sharing news on your facebook page, twitter, and Instagram whenever there’s news to be had. ​
​

Related: 5 Dos and Don'ts for Marketing your Movie on Social Media

8. Press coverage is key: Local Press can be very cliquey.  

Local Press coverage is among the best ways to drive traffic to your movie.  However, it can be difficult to get. 

It should surprise precisely no-one reading this list that some film scenes are very cliquey, and some of those people from the film scenes end up in positions of power at general press outlets.  They may not cover your movie just because you’re not one of the cool kids.  It sucks, but it is what it is.  It would be difficult to change their mind, so just move on to other outlets if that’s what you’re running up against. 

9. In the end, if you've made ANY money you've done well. 

Finally, there’s not really a lot of money in theatrical runs themselves.  There is a lot of additional money to be had in having had a theatrical release.  If you end up getting beyond your distributor’s recoupable expenses, you’ve done VERY well.  The additional money you’ve gotten from these outlets is likely to have a marked impact on your TVOD sales and your SVOD sales price.  I might be making some announcements about how that worked for Goodland on our Facebook page, soon.

I hope this was helpful to building your indie film career. If you’re embarking on your own journey through distribution, you should make sure to grab my FREE indie film resource package. It’s got lots of templates to help you talk to distributors, tools to help you raise funding and even exclusive money-saving resources.

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The 7 Main Indiefilm Distribution Deal Points

A lot of people are afraid of the complexity of deals with sales agencies. They have a reputation as being very dense, and difficult to understand. While there is truth to this, there’s also a general layout every filmmaker should understand. Many of the pitfalls for distribution can be avoided by knowing these 7 major deal points. That said, you should always have a lawyer or a producer’s rep look over your contract.

This list is not meant to be complete, but it does cover the most important aspects of the deal.

1. Term

This is not really different all that different from the standard legal definition of the term, it’s simply how long the contract will remain in place.
​
For film, a good term is anywhere between 3 and 7 years. The sales agent will generally be able to sell the film to third parties [i.e Buyers] for terms that extend beyond the contract with the filmmaker.

2. Territory

The territories are where the sales agents have the right to sell your film. These rights can be both exclusive and non-exclusive, but if you’re selling to a sales agent without the help of a representative or a lawyer, you’ll likely be selling them all rights.
Generally, territories are broken out by both region and country. For example, Germany would be considered a territory in the Western Europe Region. This can get confusing, in that Latin America is both a territory and a region. The Region also contains Mexico, Brazil, and a few others.

3. Languages

One must keep in mind that the business of international sales a global one (as the name would imply.) As such, it means dealing with both cultural and language barriers. Often, a territorial sale is heavily influenced by language. For instance, France is often sold with French Canada.

4. ​Media Rights

Media refers to the different Delivery methods that a sales agent can sell your film by. Different rights would include the following.

1. Theatrical
2. DVD/home video
3. PayTV
4. Cable/NetworkTV
5. VOD [Et Al]

Read more: The 5 Main Indiefilm Media right types

Generally, a sales agent will sell by any combination of these three types of rights. Most of the time, these rights will be exclusive, but sometimes they will be non-exclusive. This is more common for VOD deals, with some notable exception for SVOD deals. These deals are also subject to a term.
​
Exclusivity is necessary, and does help the filmmaker as well. Without exclusivity is the only thing that creates value when the thing you’re selling can be replicated infinitely. If the supply is infinite, there’s no way to have enough demand to increase the value of the content. Exclusivity helps maintain the value of the content.

5. Revenue Split/MG

A Minimum Guarantee (MG) would be the payment a filmmaker receives upfront. These are something that filmmakers can receive, but it’s somewhat rare. Generally, you’ll need recognizable talent and a hot genre in order to get one.
The revenue split the Sales Agent takes, as opposed to what the Filmmaker takes.
These splits generally vary between 20% and 35%. Generally, sales agents don’t like to negotiate this deal too much. There are other ways to negotiate these deal points.

6. Recoupable Expense

These are the expenses a distributor can charge before paying a filmmaker. Travelling to film markets gets quite expensive, often costing in the mid-5 figures to the low-mid 6 figures. As such, film they should always have a cap. If there was an MG, this would be part of the Recoupable Expenses.
​
Generally, these should be somewhere between 20 and 50 thousand, that’s not including any MG. That number could also be substantially higher if there’s a theatrical release involved.

7. Exit Conditions

This is how you exit the contract should things not go well.   This is much more complex than simply including an arbitration clause.  If The arbitrator only arbitrates based on the initial contract, so if you don't have exit clauses you're not in a great place.  There are lots of different provisions for this, far too many for a blog post, but here are a few things you could include.

• Optional Reversion if X% of the budget not meant by 18–24 months after deal signing.

  • This would mean that if you haven’t made a certain percentage back by a certain date, then the rights would revert to you. Generally, you’d put this number at 30–50%.

  • In an all-rights deal. It’s your film, you deserve to get paid.

  • While you deserve to be paid, this clause is harder to negotiate in than it once was.

• Optional Reversion if the company is wholly acquired by a third party, or goes bankrupt.

  • International sales is a risky game, and often the newer players in it don’t last long. Because of this, it’s important to make sure that you include this clause.

As I said at the top, I’m not a lawyer and this isn’t leagal advice. These are simply the best practices I’ve learned from a decade in distribution. If you found this useful want to better prep for success in film distribution, you should make sure you grab my FREE indiefilm business reseource pack. It’s got distributor contact tracking templates, research guides, deck templates, and a whole lot more. Get it for free below.

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Understanding Money

Since my background is at the Institute for International Film Finance, and I put in a year at Global Film Ventures, I get a lot of filmmakers contacting me asking me to help them fund their films. Some of them are good pitches, but most are not. Getting investment for your film is incredibly difficult, if not nearly impossible. There are many reasons for this, but one that is not often talked about is the fact that many filmmakers have a mindset that money shouldn’t come with strings, and that all they should need to worry about is making the film.

There’s this attitude filmmakers have that someone should just give them a check and then go away so they can make the film. I’ve had many filmmakers say that flat out to me, and the ignorance of it is incredibly disturbing. There’s a lot more to investment than just writing checks.

Angel investors didn’t get their money by giving it to just anybody. Investors generally do quite a lot of legwork to research those with who they invest in, and they’ll never invest in someone they don’t trust. This attitude of “just give me the money and let me be” is a huge red flag, and makes an investor far less likely to trust you. If they don’t trust you, they won’t invest in you.

Once you take money from someone, you have a responsibility to them to send periodic updates and let them know how everything is progressing. You need to be available to take their calls at most any reasonable time and always return their correspondence within at most two business days. All money has strings, and you can’t expect an investor to just write you a check and then never check in on you.

Another attitude problem a lot of filmmakers have is that they feel they don’t need to understand business. Many feel just need to make the best film possible and money will come to them. While there’s a kernel of truth in that, relying solely on making the best film possible is a great way to end up broke with a film that never goes anywhere. The best product without a marketing team will never make money. Filmmakers

do need to make a great film, but they also need to understand at least the basics of how to promote a movie and how it will see revenue.

Distributing a film, promoting a film, and selling a film are all incredibly different skill sets that require decades to master. Filmmakers can’t be expected to be experts in every job involved in making a movie. They do, however, need to understand what they don’t know and compensate for that by getting people on their team that do understand how to do those jobs.

In essence, this is the difference between a producer and a production manager, or the difference between an executive producer and a line producer. Line producers and production managers are great at understanding how to manage a crew and get a film in the can. Producers need to have a good understanding of business, negotiation, deal-making, finance, and distribution. Executives do the latter almost to the exclusion of everything else. Every film needs at least one of each of these people, and really they shouldn’t be the same person filling multiple roles.

Every film needs people who understand money, how to raise it, how to make it back, and creative ways to save it. Filmmakers of all kinds can be excellent at the last part of that. Innovative bootstrapping is a skill perfected by many guerilla filmmakers. That said, you still need money, and people who understand how to make a film see revenue on your team.

Even if you find an intermediary who can help you get the money from angels, you’re still going to have to have regular phone calls and meetings with that intermediary. In fact, that intermediary is probably going to have more contact with you than an investor would because they understand both investment and filmmaking. You need people like this on your team, and you need to understand that you’re creating more than just a film. Every film is in essence a business, and in order to run a successful business you need skilled business people just as much as skilled artists and visionary directors.

Whenever you seek investment, it is into your business. You need to understand that the business side of the indusry is necessary. You also need to have an appreciation and at least a basic understanding of what it takes to make money in business. This should not be your sole consideration, but it does need to be part of your plan when creating a film. If you do not include this in your plan, you’ll never actually see revenue from your projects.

So readers, if you’ve ever thought that all you need is someone to write you a check; remove that notion from your head. In order to get money, you need to understand money. Only if you understand how money works, and have a good business plan will you be able to successfully get investment and make a profitable film.

Black Box - a Call for Transparency in Film

A Black cube on grass in a yard, with the Title “Black Box” in the upper left corner and the subtitle “An In Depth Analysis of ‘Hollywood accounting” in the lower right corner, and logos for Guerrilla Rep media and PRoducer Foundry in the lower left corner.
Photo Credit thierry ehrmann Via Flickr, Modifications made to add title, subtitle, and logos

The process of Filmmaking has been evolving rapidly over the past decade.  With the massive change in the availability of equipment, negating the need for tapes or stock, and bringing the professional quality down to a price point thought unfathomable merely a decade ago, the barrier to entry for making a film has been almost completely obliterated.  Additionally, education on how to make a film has become widely available, from the massive emergence of film schools to a plethora of information available in special edition DVDs, anyone can learn how to make a film.  However, the same cannot be said for Film Distribution.  Film distribution is still a black box from where no light or information emerges.  There is a very palpable air of secrecy around film distribution, and now that film production has become available for anyone curious enough to seek it, it’s time the same is done for film distribution.

​I’ve always loved movies, and I’ve been making films in some fashion for nearly a decade.  Even though that’s really not that long, I realized that when I started, camcorders were still fairly rare among middle-class families, and far rarer among high school students.  Even the local Access channel worked with three-chip cameras, and those who could afford it swore by the film.  That landscape is now nearly unrecognizable, now every other high school freshman carries a 1080p camera in their back pocket anywhere they go.   This process has been going on for decades, far longer than my personal experience.

​In the 70s, even Super 8 home movies were few and far between.  To make a movie in the 70s involved an incredible amount of time, effort, and skill.  Many learned by trial and error, with limited training and education often in the form of watching the great films of their eras.  In those days, no one went to Film School, because there really weren’t that many of them.  You pretty much had to go to New York or LA.  

Even those who entered the industry in the 60s and ’70s often went to school for something else.  Today, there are 389 Film Schools spread across 43 states, which considerably changes the landscape for Education. 

However the same cannot be said for film distribution.  Despite the fact that technology has evolved beyond what even the most visionary filmmakers could scarcely imagine back in the 70s.  Much of it is still a black box where even the most simple information about budgets and returns are kept largely under lock and key.  Studio accounting and net proceeds are just as secret now as they have been since Jimmy Stewart became the first Actor to be a net profit participant back in the 50s.

Even if you made a film that’s being represented by a distributor, many of them will not share accurate information regarding the returns you’ve made.  A simple balance sheet is difficult to track down, and even if you can get one it’s often hindered by studio accounting, and the breakeven point is never reached, so the filmmaker never sees his or her share in the net proceeds, also known as profit participation.  If filmmakers don’t make money making films, then all they have is an expensive hobby that is unsustainable in the long term.  The problem is so vast that even Star Wars Episode 6 never made a profit.  Even if they can get their first project bankrolled, unless they can make a profit on their film it is unlikely that they will get to make another one.  In the independent film world, most times if the producer never sees their share in the net proceeds, then neither does the investor who footed the bill.

​If the investor doesn’t see profit, then they won’t be an investor for long.  Unlike the filmmaker, most of them won’t continue to do this just for the vision.  The first thing any savvy investor will tell you is that they only invest in what they know.  And while they may now be easily able to find information on the process of making the film, the metrics measuring the performance of independent films are unclear and almost always unreliable.  If an investor can’t decode and project revenue through clearly definable analytics, most of them are far less likely to close an investment deal.  Even if they do invest, if they feel like the distributor is not telling them the whole story, they generally won’t invest again.

If the Industry is to change, new money to enter it.  The old money is tied up in sequel after sequel, and rehashes of old stories.  The movie-going public is fed up with it and want something new, different from the old franchises.  This leaves a demand in the industry for quality content that is simply not being filled to the extent it needs to be.  In a way it’s similar to the ’60s and early ’70s here in San Francisco when Venture Capital was just starting, there are many talented young people with great ideas, but little business sense.

The studios are entrenched in the old ways of thinking, and behemoth companies don’t adapt well to change.  Startups do adapt well to change, and they really can change thought processes through ideas that take hold.  The Film Industry is changing more rapidly than ever before, it will likely be just as unrecognizable in another 5 years as it was 10 years ago.   Anyone can make a movie, even with a small device they carry in their pocket. The old companies and the old money can’t adapt as quickly as things are changing, so logically we need new ideas and new money to enter the industry and shake things up.  

This is exactly the effect that Venture Capital had when the Traitorous Eight left Shockley Semiconductor to start Fairchild, and then left to start other companies that eventually became Silicon Valley.  Fairchild was only able to be started due to a new idea that evolved into what is now known as Venture Capital.  In order to effect change as quickly as is needed, something similar must happen in the film industry.  But Venture Capital can’t enter an industry where the risks are incalculable.  Without a more transparent method of accounting, the risks are indeed incalculable.​

​The industry is evolving more rapidly than ever before. The future is unclear.  It’s a wide-open frontier where anyone can make a movie, even with a small device they carry in their pocket.  The process of film production has moved out from the dark rooms and light-proof magazines of old and exposed for all to see.  It is time for the business side to do the same.  It is time for every filmmaker and investor to have a clear understanding of Distribution.  It is time for daylight to expose the studios’ accounting practices.  It is time for transparent accounting in film.

While there's not a lot an individual can do about the lack of transparency in the film industry as a whole, there are ways that we as individuals can band together to have an impact.  Those tactics are some of what I tried to implement at Mutiny Pictures, and what I address in my content, groups, and consulting. One of the goals of porting over my website was to greatly lessen advertising and sales, but check the links below to learn more about ways you can impact not only your career but the industry as a whole. More details on each of the buttons found below.

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