5 Tips On Independent Film Financing

If you’re looking for independent film financing, take a number.

Every filmmaker on earth wants an easy solution for finding the money.

It’s a BIG challenge. (But you already know this!)

In the years since I started, social media and various crowdfunding platforms like Seed&Spark, Indiegogo and Kickstarter have emerged with the goal of accelerating the independent film financing process. And while these tools aim to make the process easier, you will still need to infuse your efforts with resilience, passion and a game plan.

And here’s the deal. . . Even guys like Tom Malloy (who’s raised over 25M to produce his own movies) would agree that there is no easy solution to independent film financing.

Any person who says there is a “done for you” solution that requires absolutely no work on your part is a fibber.

(Please note: With the proper strategy the independent film financing process can get a little easier. Especially when you create a game plan. But getting the money will still involve pitching and possible rejection.)

And before we start talking about independent film financing tips, let me provide a little context.

I don’t know about you – but when I was starting out, I knew nothing about independent film financing. I met with quite a few “producers” who were happy to drill me for information. They wanted to know what I knew. . .  But for some odd reason, they refused to share their film financing secrets with me.

That aspect of the process was a bit annoying.

But through the years I uncovered a fundamental truth about independent film financing. . . Ready?

Each indie film is a start up. And because start-ups usually depend upon raising money, the process of raising money is nothing new. This means most prospective investors are used to hearing business pitches.

Independent Film Financing

The traditional ways people raise money in the United States, aside from going to a bank and getting a loan (which I wouldn’t recommend as an independent film financing strategy),  usually works like this:

  1. Meet with an attorney and put together some complex paperwork (which includes a private placement memorandum) in-line with the Securities and Exchange Commission regulations.
  2. Creating relationships and meeting with prospective investors.
  3. Asking for money – and then getting the check!

While I distilled the whole independent film financing process down to the bare essentials, each step will involve considerable time and effort on your part. My suggestion here is to plan for more than a few months of heavy (and I mean HEAVY) grinding.

How much money do you need to raise? Do you need a few million to make it? Or can your project be made for much less?

This budget factor alone will highly influence your strategy. Just keep in mind – If you’ve worked really hard to eliminate costs in your budget, then it’s possible to make a fancy looking movie for much less than you think.

Risk Versus Reward

It’s not enough to have a movie project. What you need to constantly ask yourself is: “What’s in it for the investor?” In other words, given all the other investment opportunities like stocks, bonds, mutual funds and real estate – Why should your prospective investor dump their money into your project.

This comes down to risk versus reward. In the game of independent film financing, you will need to ethically convince your prospective investor that no other investment (at this time) offers the same benefits. How will you personally eliminate risks and increase the reward? (Each investor has a unique risk tolerance.)

5 Tips On Independent Film Financing

Lets take a look at some traditional action steps for independent film financing:

  1. Cultivate a legitimate friendships with rich and successful people.
  2. Get an attorney to write up something called a private placement memorandum.
  3. Figure out how you’ll spend the money (Hint, this is your movie budget!)
  4. Figure out how you’ll get the money back.
  5. Over a million and you may run into some trouble getting a return on your investment.

Independent Film FinancingNow again. Raising money is a super simple subject (just find rich people and ask for the money) – but the laws and rules and regulations mean that you’ll need to know a few things about protecting yourself and your business from liability.

If you’re looking for more independent film financing resources, you may want to check out the system I produced with Tom Malloy. Check out our film finance guide by going here.