5.5: Other Funding Avenues

Self-Financing

Many young filmmakers start by self-funding their own films. Students completing school assignments have the luxury of utilizing their classroom equipment and fellow students to grip and act in their screenplays. This exercise in self-funding wears thin as filmmakers evolve to more sophisticated productions. Seeking crew with better skill sets and actors with experience will cost more than a director wants to spend out of pocket.

Private Investors

When a filmmaker needs to find other financing, the first place to look may be friends and family, but Christmas and birthday gifts or a stray dollar here or there do little to improve equipment costs. Private investors will want to see a track record of past work but also some development of new film ideas. The strategy is to position yourself in places where people are passionate about films. We have talked about grants and fellowships in previous chapters. The next chapter explores film festivals.

Fiscal Sponsorships

Fiscal sponsorship is an arrangement between an existing 501(c)(3) nonprofit organization and an individual or entity lacking the legal status needed to receive grants from foundations, individual donors, and government agencies. There are companies which will match filmmakers with nonprofit organizations for a fee.

There are a number of advantages and disadvantages to consider when deciding whether to enter into a fiscal sponsorship in addition to the considerations mentioned above. First, there are several obvious advantages to this type of a relationship for both the sponsor and the sponsee. The fiscal sponsee benefits from the resources, infrastructure, and expertise of an established nonprofit organization. The fiscal sponsor gets a new project to start expanding the support it provides to the community. The fiscal sponsor can better serve its mission faster with little work. Additionally, the fiscal sponsor can hire the sponsee to help run the project to gain the benefit of their intimate knowledge with the project.

On the other hand, there are a number of disadvantages or cons that come along with a fiscal sponsorship relationship that may outweigh the advantages. These include the loss of total control of a project and the administrative fees paid to the fiscal sponsor. In order to create a valid fiscal sponsorship relationship, the fiscal sponsor must have control over the funds being given to the fiscal sponsee and be able to direct large parts of its operations. For some, this loss of control makes a fiscal sponsorship unworkable; but if the fiscal sponsee can bear the loss, then the sponsorship can still be beneficial to both parties.

Product Placement

Product placement is a form of advertising in which branded goods and services are featured in a production that targets a large audience. Also known as "embedded marketing" or "embedded advertising," product placements are typically found in movies, television shows, personal videos, radio, and—less commonly—live performances. In exchange for product placement rights, companies may pay a production company or studio in cash, goods, or services. You can contact local companies like restaurants for a trade of food or scene locations in exchange for an exterior shot of the business but generally you will need to find a product placement service to help you land national sponsors.

Film Studio

In the preface of this chapter, Nick Chapman found himself seduced by a studio system. It would have been easy for him to make the movie he pitched but he struggled with the changes the studio was demanding.

This is the tradeoff with teaming up with a big company. The financing part is simpler because the studio has many of the mechanisms and industry relationships already at hand. Studios handle production through marketing and distribution. In exchange, the filmmaker yields some creative control to the studio. The studio could even decide to kill the film project altogether.

Crowdsourcing

Crowdsourcing uses an online company to match many small investors with filmmakers. Depending on the size of the investment, these individuals are promised mentions in the credits, invitations to film openings, and even parts in the film or producer credits. Two of the most popular crowd sourcing sites are "Go Fund Me" and "Kickstarter".

Some have turned to crowdsourcing to complete projects that have run out of funds or to help in development and preproduction. The most successful projects have a video pitch component or trailer to give the those browsing through the listings an idea of the project.

Basically the filmmaker will set a goal as a dollar amount and a timetable for that goal to be reached.

Two Main Types of Crowdfunding

Crowdfunding sites charge a fee for their service. You will only pay the fee when your particular goal is reached. There are two types of goals: fixed and flexible. If you use a fixed funding plan and raise the dollar amount targeted, you will pay your platform fee and collect the funds. If you do not meet the target, you will receive no funds, pay no fee, and the earmarked donations are returned to the investors. In this case you will not have to keep your promises to investors, such as producer credits or tickets to openings.

In flexible crowdfunding, you will receive all the donations and pay the fees regardless of the goal. You will also have to keep your promises to investors even if your goal falls short.

Fixed Funding is the Safer Option

Since most small films are strapped for cash, fixed funding would seem the better option. There is no out-of-pocket expense if the goal is not met - then there are no promises to keep if you only get a handful of investors. The advantage is that people browse these sites, specifically people interested in films, come across your particular project and become interested in your film. You will have access to a certain population geared toward making small investments in films which you can get no place else.

Another Kind of Crowdsourcing

Filmmaker Deborah Scranton talks about and shows clips from her documentary "The War Tapes," which puts cameras in the hands of soldiers fighting in Iraq in this seventeen-and-a-half minute Ted Talk.

Read a transcript of this TED Talk.

Networking

Networking is about building relationships. For many of my students this starts in my classroom. This has mutual benefits - you help in their features, they help in yours. As students leave our program they team up with other talented students and start projects on their own.

Much of filmmaking is freelance work. Connecting with other filmmakers expands one's circle of peers. For the successful filmmaker, this process continues beyond their school studies and throughout their careers. Put yourself in situations to capitalize on new relationships with industry professionals. Here are some hints to expand your reach:

• Streamline your pitch
• Create a company name, logo, website and business cards
• Stay connected to your talented classmates. This has mutual benefits - you help in their features they help in yours.
• Follow and be followed on social media

Probably the best way to network is to enter film festivals. There are many dozens of festivals across the country. They do a great job of matching people who have a passion for films and filmmakers. The next section goes into greater detail.