New York International Latino Film Festival - Nickel N’ Diming Financing - July 24, 2008
Nickel N’ Diming Financing – Find the Right Deal
July 24, 2008
On Thursday, I attended for the very first time the New York International Latino Film Festival, which presented over 100 films throughout the week. Earlier in the day after picking up my press badge from the Roger Smith Hotel, I hopped over to the Directors Guild Theater to see the film Mancora from Peru (the filmmakers were not present for that, so unfortunately, I have no Q&A notes, other than to say that I thought it was a fairly good film, which sort of reminded me of Y Tu Mama Tambien, which is the much better of the two.) Then I went over to Showbiz Software for a panel discussion on film financing, coordinated by Edwin Pagan, who made a brief introduction. The panelists touched on a number of topics ranging from ways to go about finding funding for your first films to finding a universal appeal for a broader audience, and a brief case study on how the indie film Quinceañera was funded by a community. Here are highlights from the discussion:
Bienvenida Matías – Executive Director, Association of Hispanic Arts
Pooja Kohli Taneja – Founder, FilmKaravan – Curator, Filmmaker, Producer
Fernando Ramírez, Esq. – Entertainment Attorney
Phil Bertelsen – Filmmaker, Producer
Nicholas Levis – Ovie Entertainment, Producer
Slava Rubin – IndieGoGo, Co-Founder
Mike Sergeant – Filmmaker, Producer
Matías: How do you get your first money to make your film?
Bertelsen: The first money is the hardest. I’m sure that’s not a newsflash. Typically it comes from well-established relationships including friends and family. Ultimately, the first money comes when you can demonstrate the reliability of your project. The trick is to get around the whole catch 22 when they say, what have you done before? If there was kind of a magic formula to that, I would have bottled it by now and sold it and paying for the rest of my career.
Kohli: I think before you get into the game, you need very little money to actually build alliances…people who get on board early, which can be organizations or grants…that align with your project.
Rubin: IndieGoGo is an online marketplace to connect filmmakers to fans. We’re giving the tools to filmmakers for fundraising. The filmmakers have already raised tens of thousands of dollars on IndieGoGo. Some of them have already had established films in their prior careers and their building their audiences online to turn that into money for their next films. Many of the filmmakers for the first time are raising between $500 to $10,000.
Bertelsen: Your first money can be a very strategic proposition. It doesn’t require everything up front. It’s about building partnerships, whether it be with established filmmakers, production companies, websites, etc. A lot of times, the early work of getting the first money is just a matter of forming relationships who can give you credibility as a filmmaker and give your story the legitimacy you know that it has.
Matías: Many filmmakers here are everything…we produce, direct, hand out the coffee, edit. How do you feel about that?
Levis: Start with a package that ultimately you want to get to an investor. These partnerships are intended to tell a sophisticated investor what you’re looking for and that the return for them is there. My belief is that you strengthen yourself by delegating to individuals that will strengthen your project. You may be an amazing director, but you find a producer who is better at producing. Just because you’re a great producer, doesn’t mean you’re a great distributor. Finding your alliances and building a team…the bigger the team is that you trust, the further you’ll go.
Matías: When should filmmakers think of getting an attorney as part of the team?
Ramírez: Let me first say that I tend to think of funding as falling into two broad categories:
- Obtain secure funding from grants and foundations (ie. The Ford Foundation, Rockefeller Foundation). That tends to be for the most part for social-themed documentaries. It takes a long time however. They usually want to see a body of work and someone with experience. It’s also an investment that’s going to pay off on their part.
- Private equity…trying to get money from sophisticated investors. That tends to be a significantly more complicated process because you’re dealing with securities. You have to go through processes like registering with the SEC or blue sky agencies or coming up with documents that will have enough information for sophisticated investors to make an informed decision regarding their investment, because it is a really risky business.
Levis: The earlier you bring in council (and accounting), the better. Building that team is such an imperative aspect. At times, it may seem a little overwhelming, but there’s a lot of individuals out there that realize that risk. A great filmmaker or producer does not make a good lawyer or account, so asking as many questions as you can and getting free advice, so that way when you are approaching grants or private equity, you’ve got your numbers down. You have all those answers that are so important to them.
Rubin: One of the things that’s important to ask yourself is what are your goals for your movie? It can be just an artistic expression. It can be because you want to change your career and do this for a living…whether it’s a success or not. Be realistic. Christopher Nolan (director of The Dark Knight) is obviously now a rich man. His first movie cost $11,000.
Matías: When thinking about how to raise money, how do you divvy up the budget so you can understand who you’re going to approach?
Bertelsen: I think it starts much like Slava was saying by asking what your goals are. Ask yourself, who is the audience for this film? When you start to examine your project, you make decisions on who would be appropriate person to bring this to. For example, you’re not going to bring a low-budget indie horror film to a structurally themed documentary production company. It goes without saying, but you’d be surprised at how many first-time filmmakers don’t read the guidelines and don’t pay attention to what’s being asked of them when it comes to how to prerequisite their projects. You want to be very targeted. You’ve got to do your homework and know what it is they’re looking for. Tailor your projects to those interests the best that you can.
Kohli: I think it’s very important to do that homework he mentioned. Who are the players in the market and what they do? Exactly the way you have goals for your films, they have goals for their money. You need to be ready to understand who is most interested in your project. Be realistic. Who was the last you? Who did exactly what you’re trying to do? Learn from their mistakes.
Sergeant: Be creative and you have to be willing to really go that extra mile. I was going to do a narrative film depending on what it would cost. When you’re doing a narrative film, anybody who’s an investor or wherever you raise money, they want to know, ‘how can I get this back?’ A movie is one of the quickest ways to lose millions of dollars really fast.
Ramírez: All that information on how prepared you are should be a in a business plan. There’s a series of books out there, one that I’ve talked about on panels before is by Louise Levinson, Business Plans for Filmmakers. You’re going to have to do the research on what the market is and projections. What type of films like yours have made money? You also have to be honest for instance, these films like mine, have not made money, but most have. I was watching Quinceañera…I was so shocked in the interviews…I think they had an idea for a movie. They went to somebody. They had the money before they even had scripts. I had to rewind that. I don’t think that really happens
Levis: With the packaging and everything’s in place, there are so many key elements where things can go awry. It must be frustrating even after you’ve made a few films to locate the money. The global market is such a changing one. Last tear investors on Wall Street were really aggressive, but with the economy changing so much since last year, the opportunities are not there. Europe is looking to us now, because their money is so much stronger. Right now the pound is two-to-one. That means if you can start to talk to individuals there now that for instance say they’d like to shoot in New York City…what would cost 500,000 pounds here, I can easily get $1 million American. Things kind of equal the same. The day rate here, the day rate there. That’s true with a lot of European money. They’re really looking to the U.S. because everyone wants that U.S. affiliation. The opportunity to present yourself with a co-production company out of Spain or France or London…what you’re doing ultimately is giving them the opportunity to send their money and it goes further. Your business plan should also think about what happens outside the U.S.
Rubin: The Hollywood system has a term called pre-selling of foreign territories.
Matías: Historically, it has been difficult for us as Latinos and Latinas to be able to break into making these films and finding this money. Have things changed? Is it easier? Do we have topics that people want? Are our own communities willing to support what might not be mainstream, even by indie definitions?
Bertelsen: It is an increasingly global marketplace. I think that only adds value to our stories as Latinos, as people of color, and women in a world where we have to make up the majority. I think the goal is to find a way to reach that audience.
Ramírez: I often hear that a film has to have a universal appeal. How as a filmmaker of color and you want to make a film that portrays the experience of your community in a way that’s appealing? How can we make films that can get picked up by distributors?
Kohli: From a South Asian angle, filmmakers like Mira Nair and Deepa Mehta tell South Asian stories, but these are not stories for the South Asian market. These are stories that people all over the world want to hear. I think a good film from any angle, the simplest way for you to have a barometer is if people can somehow relate to it. A story we can feel, we can be a part of. That in the simplest form is a success. If you can take what is in your film to an audience that is not you…you don’t want people like you sitting in the audience watching this film, but you want people who are not like you to be able to see like you. Vanaja that went to over 100 festivals and won about 30 awards was released by Emerging Pictures, it did numbers that were less than 10% in South Asian markets. Be able to convince someone who’s not you about the story. I think people want not to educated the audience with every film. Try not to beat them on the head with it. You can get the story across in a way that delivers the message, but if you’re going for an audience that’s not your core audience, you need to make it slightly easy for them.
Bertelsen: The onus on us as filmmakers of color is to prove those economics. In addition to all the things to get in the room, be prepared to make the argument with the market research.
Matías: To get back to the issue of Quinceañera, the film did not have a script when they got the money. They had an idea. They had lived in the neighborhood. They had been involved with the whole ceremony of the quinceañeras. They were connected to a whole group of people who had money. It was the group of people who gave them the money, and they said, now I have to go out and make a script. They made the script in a very short amount of time. The reason that film works is they worked with the community. They found the Madrina, the woman in the community who really knew how to teach everyone how to participate in a quinceañera ceremony. That’s really what gave the film its authenticity of a right of passage for a young woman.