Filmmaking: Art and Money

Three Financing Options: Deferred Equity, Talent Swapping & Crowdfunding

Which should you choose? Like all artists, filmmakers often struggle to support their art. Building relationships with other filmmakers is always a great idea for many emerging filmmakers who have limited funding sources. The trend towards forming gypsy crews of filmmakers who agree to swap time and skills is a win-win, if all live up to their bargains. They usually do because local independent filmmaking communities are much like the smallest of towns, so reputation is everything.

Another option is deferred financing or equity agreements. With deferred equity agreements, producers are able to avoid practically all their costs for a project.  With a deferred agreement, a crew, cast, vendors, locations, and other services are all provided up front without any initial payments until the film generates money upon release. The filmmaker needs to have a lot of credibility and dynamite marketing plan to sell this one. Experienced cast and crew are often unwilling to work under these types of structures, so deferred financing may be difficult for most indie filmmakers to negotiate.

While crowdfunding (Kickstarter, IndieGoGo, etc.) enables a donations-based model for capital to be raised without selling equity. The benefit is a built in support system and no debt to pay back. A crowdfunding company that is getting a lot of attention lately is Seed & Spark, which boasts of having the highest success rate in the crowdfunding business (75%) and supposedly the lowest fees. What’s so great about crowdfunding? It allows you to test the potential interest in your project and create an immediate audience, your individual backers.

Inventive paths for independent filmmakers to fund their dreams will undoubtedly appear, morph, and hopefully improve over time. Finding the right path to financing your independent film can impact how or if you stay in the game or have to tap out. So choose well and don’t be afraid to change based on the particulars of your project.