No-Budget Filmmaking: Rise of The Backyard Indie

Like it or lump it, there are a lot of backyard indies being made each year. Thanks to inexpensive production technology, no-budget filmmaking is not only possible, but has become the norm for many first time feature filmmakers, web series producers, YouTube artists and short filmmakers.

These days any filmmaker with passion and a story can make a movie. And unlike years past, backyard indie filmmakers are not prohibited by cash or creativity.

Yet despite the no-budget filmmaking movement, many of my high profile “professional” friends in Los Angeles, have made a conscious effort to ignore the rise of backyard indies. Why?

Because no-budget filmmaking isn’t real! (At least, that’s what some of the old school pros would tell you.) When it comes to no-budget filmmaking, some common questions asked by these Hollywood hot-shots are:

  1. Who signed the SAG agreements?
  2. Who contacted the Unions?
  3. Who notified the MPAA?
  4. Where is your theatrical distribution deal?
  5. Who do you think you are?

Good questions. Why don’t you go back in time and ask Roger Corman!

But the thing is, if you create a good movie – Your audience doesn’t care if the movie was an official union indie or a backyard indie made for pocket change.

no budget filmmaking

Photo © Jacek Krol / Dollar Photo Club

No Budget Filmmaking: Rise of The Backyard Indie

The demise of traditional DVD distribution coupled with the growing market domination of iTunes, Amazon and Netflix had leveled the playing field. The big difference between a $10,000 backyard indie and a $2,000,000 dollar indie isn’t the budget – The difference revolves around the film that gets the most eyeballs (and sales).

Think about it. Hitting breakeven on a 2M feature is going to require a lot of sales.

As a rough example, to recoup 2M dollars, the filmmaker will need to to sell (roughly) 200,000 video on demand downloads at $10 a pop. These first sales will cover the 40% cost allocated to VOD providers (the real winners here), after which, the filmmaker will still need to sell an additional 200,000 downloads to repay the investors.

400,000 VOD downloads x $10 = $4,000,000 minus $2,000,000 in VOD fees = the initial $2,000,000

Meanwhile, through no-budget filmmaking, a backyard indie only has to sell 2000 VOD downloads to recover the initial 10K costs.

While nobody wants to make movies for pocket change, many filmmakers still believe we can somehow continually produce unprofitable (movie) products and expect the money and the subsequent jobs to keep rolling in.

And unlike years past, filmmakers can no longer approach investors with the cliche pitch: “Filmmaking is a risky investment – if we are lucky, we might win Sundance and get a deal.”

Now, with transparent distribution options available to all filmmakers, that line of give-me-money reasoning is reckless, no longer applicable, and in my opinion, unethical. And for these reasons, no-budget filmmaking makes a lot of sense.

Aside from the initial challenge of sales and marketing, the ripple effect reveals an even greater conundrum:

How will you raise enough money to pay your cast and crew AND still pay back your investors?

I mean, what’s the new sweet spot?

How can we once again make independent filmmaking profitable?

“I CAN’T AFFORD TO PAY MY CAST AND CREW. WHAT DO I DO?”

Here is the modern moviemaking model on how to save the movie industry.

(And you thought this was going to be your typical no-budget filmmaking article.)

To survive in this ever changing world of indie filmmaking, we have to change our strategy.

Instead of focusing on making that one big awesome indie, we now need to focus on building a genre specific movie library and spend all of our downtime building a ginormously targeted email list.

Step 1: Find your top-ten closest filmmaking collaborators. Form a company.

Step 2: Write a business plan, but instead of putting all of your focus on making one movie, concentrate on making 3-5 feature films.

Step 3: Make sure that you include a sales and marketing plan for each movie. To do this, take your proposed budget for all movies and work backwards. Start asking yourself, “How many units do we need to sell to recoup our investment?”

Step 4: In this model, instead of paying freelance day rates, you’ll have to hire long term employees and provide each with a salary and back end points (sort of like stock options) on each title.

Step 5: When the title wins, you all win. Over the years, your titles will add up. And the real compensation will come back in the form of residual movie income.

While this is not a fully refined model, it’s a start.

In my opinion, creating a sustainable business model is better than ignoring no-budget filmmaking and pretending backyard indies are not real movies.

We are experiencing a time of change.

This is the indie movie distribution equivalent of the automobile replacing the horse drawn wagon.

You can choose to ignore this movement, and you can probably succeed for a few more years. But there will come a day when all entertainment will be on-demand and cheap to produce and cheap to consume.

The question is, will you ignore the no-budget filmmaking movement and continue to play your distribution lottery ticket in hopes of winning the dream deal, or will you  join the movement and help us filmmakers figure out a way to make indie movies profitable?

If you liked this article, you’d probably benefit from these professional filmmaking tools.

Question: Should Filmmakers Move To Hollywood?

Should filmmakers move to Hollywood?

That’s the question I asked myself as I packed everything I could into my car.

I had spent the previous year grinding towards filmmaking success in New York City, while sleeping on an inflatable air mattress. And after burning through my bank account, I was looking for a change.

Hollywood seemed like a much more exciting alternative.

It took me 10 days to drive the country. Two of the days were spent in the never ending Texas highway. (Seriously, if you never drove across Texas alone, don’t!)

Should Filmmakers Move To Hollywood?

Little did I know, but Hollywood is full of guys like me. In fact, year after year thousands of Hollywood hopefuls answer the “Should filmmakers move to Hollywood” question with a definitive YES.

And I understand that you know this.

But you don’t really know this until you’re here. Within the first week, you will see your doppelganger, a lot. You will overhear conversations too. Literally everywhere you go, someone is talking movies or “the industry.”

And even though you sort of suspect that the odds of your filmmaking success is greater than the next guy, deep down you know you’re just a small fish in a big pond.

But you can’t deny it.

No matter where you are in the world, Hollywood represents a much bigger game.

And the only thing that differentiates you from the gazillion other Hollywood hopefuls is the work. Nothing matters more than actually picking up a camera and making something – Anything.

Filmmakers_Move_To_Hollywood

Should Filmmakers Move To Hollywood?

I guess my experiences in New York served me well. When I arrived, I immediately met up with some equally ambitious filmmakers and together, we produced, marketed and sold our first feature.  It was a silly zombie movie.

The movie went viral. It opened the door for a few of us.  My buddy Jared wrote it. He got an agent. And I ended up working professionally in video on demand distribution.

In the years since, I have consulted with well over 300 filmmakers on their distribution strategy. And if I learned anything, it’s the fact that everything has changed in filmmaking.

Since making our first feature, there have been some serious developments in production technology. And once again, this forces us to confront the age old question.

In fact one of our Filmmaking Stuff newsletter readers named Jake asked the following question:

“My filmmaking friend in LA told me NOT to make anything in my small town because I would just be wasting my time. He told me no one in the industry will take me seriously if I make my 1st feature outside of Hollywood. So instead of making what I CAN make right now, I’ve been working to move to LA to start doing something… My question is this: is he right?”

So dear reader – Should filmmakers move to Hollywood?

. . . my response to this question is a big fat NO!

Unless you plan on working for a major studio, you no longer need Hollywood.

If you are a filmmaker with an idea and the passion to create a feature film, you can do it from anywhere on earth.

Here are a few reasons why:

Getting Money In Hollywood Sucks

Everybody in Los Angeles is competing to find someone (or some studio) willing to back their movie project.

Can you imagine a town where your waiter is an aspiring actor, your cable guy is an aspiring screenwriter and your taxi driver is an aspiring producer?

Hollywood is saturated with an over-supply of willing, talented, aspiring workers.

And they are all waiting for their big break.

Even if you do raise the money to make your movie, you’ll have to raise a lot more to shoot in LA, because everything (locations, equipment, props, and permits) makes making movies in LA cost prohibitive and a royal pain in the butt.

What a mess!

On the other-hand, if you live in small town and you have good material and ambition, you’re in luck.

If you can get past the fact that all your non-filmmaker friends think you’re crazy, you can build a team, find cheap locations (and other resources, including free food) and you can take action.

Heck, you might even make the nightly news  – When this happens, just make sure you advertise your movie website and start building your audience list!

And. . .

Unlike trying to get a meeting with a busy, semi famous studio executive who never heard of you – If you call up the local rich guy to make a pitch, your odds of getting a lunch meeting are pretty high.

As I detail extensively in my film financing program, getting meetings does not guarantee success.

But it’s a start!

And let’s pretend for a moment that your town has no rich people. Well, thanks to crowdfunding sites like indieGoGo and Kickstarter you can now reach an entire global audience of people who may be interested in sponsoring your work.

Filmmaking Equipment is Now Cheap

When I was getting my start, I saved up an entire summer to buy a used Arri BL 16mm Camera. I shot a short film over a weekend. And then I spent the entire winter saving up enough money to process and transfer the film to video.

That sucked.

Times have changed.

These days, if you want to create cinematic quality content all you have to do is go to your local electronics store and pick up an HDSLR camera and start producing your backyard indie. As long as you take time to understand lighting and camera angles, your end result will look pretty amazing.

Distribution Changes Everything

Read this part carefully.

Everyday I am amazed that more filmmakers are not getting naked and running into the streets cheering (Ok. I’m kidding.) But here is the deal…

The biggest, most awesome change in cinematic HISTORY is distribution. And modern movie distribution changes EVERYTHING!

Thanks to all these platforms found at  Distribber  (yes, they are back and they pay me to promote) – Anyway,  you can now get your movie into sites like Hulu, Amazon, iTunes and other VOD outlets – Without giving away all of your rights (for life) to some distributor who will likely never pay you what they promised.

What does this mean for Modern MovieMakers?

This means that instead of raising money and crossing your fingers for a dream distribution deal, you can now create a marketing plan within the context of your movie business plan.

This is important and liberating.

Non-discriminatory distribution allows filmmakers to treat their movie business like any other business. You do not need to ask permission to create a product, access a marketplace and make sales!

In other-words, as long as you have a camera and internet access, you can now make, market and sell your movies without asking permission. (Ok, if you really want to get naked and run into the streets, I won’t stop you.)

A few words about marketing.

Whenever I put on my  film distribution talks, invariably someone will ask me about marketing. And it’s a good point. Because distribution is now part of your movie making business, you will need someone on your team who can market.

Here is the big disconnect.

Hollywood (and traditional sales agents and distributors) will tell you to leave distribution to the experts. They will tell you to give up the rights to your movie because their company has been in business for a gazillion years.

But this kind of talk is crap. I mean, obviously if these guys offer you a huge cash advance, it might make sense.

But if there is no money involved, what value are they giving you? The promise of getting your movie seen and selling on iTunes and Hulu? You can just as easily access iTunes and Hulu too.

My point is, unless these old-timers know how to source the appropriate target audience (and they openly share their marketing budget with you and are fully transparent with each marketing step) then there is no value to give away your rights in exchange for validation. Validation and a crappy distribution deal does not pay the bills!

Should Filmmakers Move To Hollywood?

Wow. I intended to write a quick reply to this BIG question and I totally blasted you with my filmmaking passion.

Instead of asking: “Should filmmakers move to Hollywood?”

Consider a better question:

“Given the resources that I have now, what is the movie that I can make this year?”

Hopefully you are now inspired to make, market and sell your movie from anywhere on earth. If that’s the case, I’d love to read your comments below.

One last thing…

After reading articles like this, I get a lot of emails from filmmakers who need some additional help. So if you would like to find out more about filmmaking process, you might just want to check out some of these professional filmmaking tools.

 

How To Finance Movies With VOD Sales Projections

Do you know the most popular question filmmakers ask me?

I’ll give you a hint. It has to do with video on demand.

Ready. . .

Without too much variation, the most popular question is: “Can you provide some VOD sales projections?”

I understand the motive behind this question.

Believe me, I do.

You’re a filmmaker. You either made an awesome movie and you’re trying to use VOD sales projections to convince your partners that VOD is the way to go. Or you are in the process of making a movie and you need to convince your investors that VOD is awesome. In both scenarios, you’re trying to find proof that movies make money in VOD.

I get that. . . But. . .

Let’s make one thing clear. Asking for VOD sales projections is asking the wrong question!

If you dig around, examples of VOD Sales successes are out there. Check out what The Polish Brothers did. And if that’s not enough, Google the case study around Indie Game the movie.

But the truth is, one filmmaker’s past success does not guarantee that your movie will be successful.

Read that statement over and over again. And if you need a little more clarity, take a look at what the cat is saying here:

VOD Sales Projections

Realizing that VOD sales projections are BS is essential for your success. And I am going to explain how you can use your new found understanding for good, very soon…

But before I go there, let’s talk about why people invest in independent film.

Why Investors Invest In Indie Film

Independent movie investors invest because (aside from having an appetite for risk and an interest in the film business) most of these people want a return on their money. If you are doing things by the book, you probably created a marketing strategy as part of your business plan. This plan provides prospective investors an overview of how investment dollars will be budgeted, spent and hopefully recouped.

In the past, trying to convince investors movies were a good investment involved projecting returns based on speculative data. To guess how much money a movie may make, filmmakers would compare their project to other successful movies.

Creating indie movie comparables is complete BS.

The reason for this is simple.

Just because you make a low budget horror movie does not guarantee your movie will have the same success as Paranormal Activity.

In fact, Paranormal Activity is an outlier. It is not a fair comparison. And using breakout hits as examples, while ignoring the thousands of unsuccessful horror movies made each year, is short-sited at best and I dare say a little unethical.

Video On Demand Sales Projections

Given the birth of VOD distribution, as a filmmaker you now have the ability to access and enter into a non-discriminatory marketplace as soon as your movie is ready. And because many of these marketplaces exist online, much of your sales will come from internet traffic.

This is actually awesome news.

It means that you can boost your sales by using a very common marketing concept called…

[Seriously… Are you ready? You are about to receive the secret sauce of modern, indie movie marketing.]

More important than VOD Sales Projections is:

Conversion Rates

What is a conversion rate?

Conversion Rate Defined, According to Wikipedia:

Your conversion rate is the proportion of visits to a website who take action to go beyond a casual content view or website visit, as a result of subtle or direct requests from marketers, advertisers, and content creators.

Conversion_Rate

In other words, if you send one-hundred people to your movie website and two people buy your movie, your conversion rate is two percent. This is profound. This is life changing for indie filmmakers!

Question: Why should filmmakers be enthusiastic about the internet marketing, nerd concept of conversion rates?

Answer: If you know your conversion rates, you can model and potentially project more accurate movie sales projections from day one.

But before you start noodling around to find your conversion rates, it helps to answer the following questions:

Modern MovieMaking Model

  1. Who Is Your Target Audience?
  2. How Large Is Your Target Audience?
  3. How Will You Reach Your Audience?
  4. What Is Your Marketing Strategy?
  5. How Many VOD Sales To Break Even?

While I won’t get into the actual mechanics of marketing and selling your movie here (My Action Guide How To Sell Your Movie provides you with an actual step-by-step plan for getting your movie seen and sold), I will simply note that a marketing plan must now be included with your business plan.

The Secret VOD Sales Projection Formula

When you create (or refine) your marketing plan, you must now include some marketing math.

Truth be told, math is a weak subject for me and I dare say, most of the filmmakers I know. But luckily there are many spreadsheet templates that allow you to test several conversion rate scenarios. You can use these scenarios as a guideline to ballpark the potential ROI for your movie.

Here is a basic website conversion rate calculator you can utilize: http://bit.ly/17TSCrt

Before you get overly excited (like I am) calculating your movie website conversion rate is only one metric to determine your movie’s potential for profitability. You still need to figure out how to price your movie. And at the same time, you will need to determine how much targeted internet traffic will cost you.

Generating Internet traffic is the result of executing four strategies. You can either get free traffic online, free traffic offline, paid traffic offline or paid traffic online.

For the sake of this example, I am going to incorporate pay per visit advertising. With pay per visit advertising, you simply pay for someone to visit your movie website.

One example of Pay Per Visit traffic is StumbleUpon. It’s a social bookmarking site that also allows you to pay for semi-targeted traffic. This works well if you have a movie with a dose of controversy and a strong hook.

And again, if you’d like more info on specific traffic generating strategies, check out my indie guide to distribution.

Ok. Here is our first example…

Let’s assume only 1% of the targeted folks who actually visit your website, buy. Then how many visits will you need to sell 100 units?

100 units = Our goal for this ad campaign.
$.05 = Amount you may pay advertiser per visit.
X = Number of Visitors Needed to buy 100 units if only 1% buy.

(X).01 = 100 units
EQUATES TO: X= 10,000
THEN 10,000($.05) = $500 paid for targeted traffic.

So in other words, if you were lucky enough to get a 1% return, you just paid $500 dollars in pay per visit advertising to sell 100 units of your movie. But let’s go one step further. Let’s assume you’re like me – and you hate order fulfillment and shipping. So you decide to let a company like Amazon’s Create Space or iTunes (or some other popular marketplace) handle your order.

Video On Demand For Rent (Electronic Sell Through)
100 units ($3) = $300 – 50% paid to marketplace = $150
minus $500 paid for advertising = -$350 NEGATIVE

In this VOD rental scenario, the Pay Per Visit Ad numbers don’t work, unless you like losing money.

Video On Demand For Download (Electronic Sell Through)
100 units ($10) = $1000 – 50% paid to marketplace = $500
minus $500 paid for advertising = BREAK EVEN

In this VOD download to own scenario, the numbers work a little bit better. Assuming you’re lucky enough to get 1% of your money returned, at least the advertising pays for itself. But unless you can increase your conversion rates, pay per visit advertising is going to be very difficult method for returning money to your investors.

Physical DVD Sales
100 units ($20) = $2000 – 50% paid to marketplace = $1000
minus $500 paid for advertising = $500 in profit.

Ah ha! If you’re fortunate enough to get 1% return on your pay per visit advertising, you can see how physical DVD’s (or units) sold at $20 dollars may offer a slight profit margin. In other words, in this scenario, for every $.50 cents you spend, you get $1 dollar back.

So let’s tackle the bigger problem. Let’s try to get a return on our 1Million dollar movie, selling physical DVD sales and using pay per visit advertising alone:

Movie Budget = 1 Million dollars
Physical DVD Sales using Pay Per Visit Advertising

$1,000,000 divided by $20 per unit = 50,000 Units

Since we will give 50% to the marketplace for all sales, we will need to project for double our budget.

100,000 units = Our goal for this ad campaign.
$.05 = Amount you may pay advertiser per visit.
X = Number of Visitors Needed to buy 100,000 units if only 1% buy.

(X).01 = 100,000 units
EQUATES TO: X= 10,000,000 (Yes, TEN MILLION people.)
THEN 10,000,000($.05) = $500,000 paid for targeted traffic.

100,000 units ($20) = $2,000,000 – 50% paid to marketplace = $1,000,000
minus $500,000 paid for advertising = $500,000 in profit.

So to break even, you would need to sell 100,000 units and make $2,000,000.

Some Sales Conclusions

Based on this scenario, as a filmmaker you will (obviously) need to expand your promotion beyond pay-per-visit advertising!

But importantly and most AWESOMELY, you can treat your movie business like any other small business. With VOD Sales projections, you can find the marketing formula that works for your movie and crunch your numbers until you find a scenario that brings you profits.

Create a plan that included your marketing costs in your budget.

While there are no guarantees in any business, having a plan for marketing, sales and distribution sure beats the old days when your only plan for ROI involved crossing your fingers in the hopes someone will offer you a profitable, traditional deal.

While these may not be the VOD Sales Projections you were looking for, hopefully you now realize the power of knowing your conversion rates.

Treating your movie business like any small business simply means you don’t have to ask permission. You can make your movie NOW! And your prospective investors might take notice…

Also, can you do me a favor? If you liked this filmmaking article, could you kindly retweet or share this article with your friends?

Free Filming Locations and Other Favors

Many filmmakers limit opportunities based on misguided beliefs. In order to make a feature film, many of these Hollywood hopefuls set their sights on raising a gazillion dollars. But without a track record or a working understanding of how to connect the dots, many would-be filmmakers fall short.

I blame the gurus (the ones who never stepped on set) who tell you that in order to be a real filmmaker, you need to focus on a huge budget, A-list talent and secure foreign pre-sales.

I believe this advice is not only dated, but unrealistic… And it makes most would-be filmmakers lazy. Since I  can’t secure pre-sales, so I guess I can’t make my movie. Darn it! Whenever I give talks, I ask filmmakers to write down and answer the following question:

“Given the resources that I have right now, what is the movie I am going to make this year?”

Answering this question forces you to focus on what you have, versus what you do not have. And this focus is essential for actually taking action and making something (versus the many people who just talk.)

If you’re a first time feature filmmaker, you do not need a gazillion dollars to join the feature club. But you will need to learn how to replace money with ginormous creatively. And once your screenplay is complete, then the next step in the filmmaking process is your initial breakdown and schedule.

Free Filming Locations

With the application of tremendous creativity, it will be possible to reduce your movie budget significantly. Your goal is to find discounts such as free food, locations and gear. To get the process started, I suggest finding friends who own locations you can utilize for free. Reach out to acquaintances and find out if they have access to discounted equipment. Then rework your schedule and finish your movie faster.

One of my buddies employed these strategies and got lucky. He had a location budgeted for $5K. However, after my buddy spoke with the owner of the location, the fee was reduced to zero. How? My buddy (a creative producer) agreed to shoot a promo for the owner’s business. Another filmmaker friend got free food for his entire shoot simply by asking.

Remember, if you do not ask, you do not get!

If you liked these filmmaking tips (and you are serious about taking action, so you can make your movie now!) You may want to check out some of the professional filmmaking resources found here.

Who Needs Traditional Distribution?

As a filmmaker, selling your movie usually involves traditional distribution – film festivals, schmoozing, phone calls, follow up and a whole bunch of NOs and crappy distribution offers. And even when you get your movie into the market, there are still no guarantees that your movie will be a success. This can be discouraging.

Earlier today I spoke with to David Branin and Karen Worden of the popular filmmaking resource, Film Courage. After completing their feature film, Goodbye Promise, they decided to forgo film festivals and avoid the typical filmmaker distribution path. Instead they decided on a simple distribution strategy that involved YouTube and the popular crowdfunding site called IndieGoGo.

In the following interview (which was unplanned and unscripted), we talk about our filmmaking backgrounds, the projects we are working on and case studies – Pay special attention when we start talking about case studies related to crowdfunding. We highlight the good and maybe more important, the not-so-good realities of trying to raise money

You can check out the interview here:

After watching the interview, you can contribute to the Goodbye Promise Indiegogo campaign.

Was this video useful? Comments are welcome.