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A sample lesson from our Producing Course...

THE SECRETS OF FILM FINANCING

If you are looking to make a feature film, this lesson will be a real eye-opener. We will examine film financing from the perspective of successful producers.

The approach is probably not what you expect since it goes against the grain of what is typically taught in film school. On hindsight, however, you may come to appreciate it. Especially when it helps you avoid repeating the mistakes of countless unsuccessful filmmakers.

Typical Approach

Virtually all aspiring filmmakers and film school grads want to make a feature film. One of the first things they do is try to raise financing.

Film financing is a difficult task because of the risk investors are expected to take. Despite this, some budding filmmakers actually achieve it. They typically raise financing from friends, relatives, and/or "angel" investors. After completion, the film is rolled out on the festival circuit in search of a distributor.

This is the typical route for novice filmmakers. Seems reasonable, right?

Wrong. There is an inherent flaw that will doom the film to failure. Read the approach again and try to find it.

The problem is that the approach is backwards. Securing distribution should be the first step, not the last.

Securing distribution is the first step
 in making a feature film, not the last.

Crucial Link

You may be asking yourself, "What does distribution have to do with financing?" The answer is: everything!

The distribution deal is how you raise financing. By pre-selling distribution rights, you can raise anywhere from seed money to virtually the entire budget. Distribution rights include:

  • Domestic Theatrical

  • International Theatrical

  • DVD

  • TV

  • Syndication

Pre-selling distribution rights is how all the real players in the industry get their projects off the ground. 

Recall the compelling "Cinderella stories" about projects that were unsuccessfully pitched to everyone in Hollywood before they were finally picked up, launching major careers in the process. Well, those filmmakers used exactly the approach recommended here.

Do you think that an unknown Sylvester Stallone made Rocky with his own money? Or that Mark Burnett used his personal savings to produce the first season of Survivor? Of course not. They went around Tinseltown pitching the idea until someone bought it.


Mark Burnett's Brainchild

The person or company that buys distribution rights may not be a distributor per se, but can guarantee distribution by virtue of a prearranged deal with a distributor. It boils down to the same thing.

Also, the various rights can be sold to different parties. That's why you often see many companies listed in credits of a film, depending on the complexity of the deals involved.

First Things First

In film school, there is an old adage that says you should use OPM  (other people's money) to make your movie. This is to minimize your personal risk.

The first thing newly minted filmmakers do when they graduate is run out to raise OPM. Okay, so they make a movie using OPM. What's the point if they can't get it in front of an audience?

The truth is, with today's affordable equipment, anyone can make a movie. However, making the movie is only half the battle. Distributing the movie is the other half; and the deal should be made before spending time and money on anything else.

Making the movie is only half the battle
(the second half).

In the development stage, all your effort must be geared to securing a distributor. This is accomplished by putting together a viable package (script, talent, production team) and pitching it to parties interested in buying the distribution rights. It is what successful producers spend most of their time doing.

You must find a distributor eventually, so why not do it the way the pros do--before the movie is made. By using this approach, you will waste less time and radically increase your chances of success.

Additional Benefits

Not only will this approach enable you to make the movie, but there are additional benefits as well:

  • The distributor has a vested interest your project and will make every effort to see that it turns a profit.
     

  • Distributors know what audiences are looking for at any given time and can help you develop the project in terms of story choice and actors.
     

  • Sale of distribution rights imparts credibility to the project and can help secure additional financing if needed.

Producing Course Topics

If you are interested in learning more about the movies used  in this
 lesson, click on the title or picture (courtesy 20th Century Fox,
MCA/Universal, Paramount, TCM, and Warner Brothers).

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