First-Time Filmmakers Beware of Financial Pitfalls

This week, I had the chance to participate in Docs In Progress’ Peer Pitch as an observer.  During the program, filmmakers new and experienced have ten minutes to pitch their film and show a work sample to their peers – there are intentionally no high-stakes industry decision makers in the audience to create stress.  Over the course of one day, the group of filmmakers and observers quickly bond, commiserate over the challenges of making an independent documentary, but are ultimately uplifted just knowing they are not alone.

The 2016 Peer Pitch. 

Near the end of the day, a discussion arose around budgets and funding.  This is something I care deeply about and wanted to list out a couple of observations and lessons learned from making my own documentary as well as from collaborating with and advising other independent filmmakers.

Personal Investment
Many independent filmmakers are putting their own money into their projects.  We all do it.  But, like personal debt, it’s uncomfortable to talk about.  On my first film, “The Last Song Before the War,” my partners and I put in over two years of our time and allowed the project to take on some debt.  Since we had Kickstarter money as well as grant funding, it felt fair for us to also have some skin in the game like the funders who believed in us.  But, we had a limit where we felt the film could pay it back, and, worse case, we could split the accrued debt amongst the three of us.

The theatrical trailer for "The Last Song Before the War." 

This is the benefit of having partners – you are sharing risk. But, we also did our best to keep down our costs, and when the debt hit a certain point, we agreed we would no longer take on anymore.  The film now brings in enough each month to cover the payments, and, while it may take another couple years to pay off the debt and make a profit, the film is able to do it.  But beware, I know of filmmakers who have over $100,000 or more in debt or have spent big portions of their pensions/retirement savings to fund their own films.  Please do not do this.  Try to find ways to fund the film slowly, have a development phase, research your market, and have a realistic sense of acquisition fees.  For instance, we were picked up to play on television throughout much of Africa for under $5,000. 

Loss Leader
I do believe it is ok to take some risk and be willing to lose a bit of money if you see the film as a stepping stone to making the next one.  This certainly played out for us.  On my next film, “Dear Walmart” my partner and I were able to raise even more money via Kickstarter as well as bring in an investor, which meant not having to put myself or others at so much risk.  In addition, fellow Flow State Films co-founder and Last Song co-producer Leola Calzolai-Stewart has been developing her film “Black Diplomacy” over time and was able to attract a well-known executive producer based partly on the quality of work we put into “The Last Song Before The War.”  While in this development phase, we are methodically and strategically planning for fundraising on that project and we are beginning to see this strategy pay off.

DIY
Now, there are DIY ways to make money on your films—direct selling DVDs through your website, streaming on Vimeo, as well as educational licensing certainly can help re-coup money (this is by far how we’ve made the most money on our first film, so don’t underestimate it).  But, for instance, many film festivals pay little to nothing to show your film, and you may find you are covering your own expenses to get there.  Again, filmmakers beware. 

Budgets
Another conversation I have with a lot of first time filmmakers is about budgets.  They are often told conflicting information – A) a funder won’t take your project seriously if you are not paying yourself and that you must budget commercial television rates, 2) Make the budget as lean as possible to get it done.  I fall somewhere in the middle.  I agree a budget must account for your time, whether or not you are giving it to the project in-kind.  Or, perhaps you are working on this film part-time while you have other income.  If so, don’t bill the project for full-time work.  Pay your crew a fair wage before you pay yourself.  Do your research and get quotes for things like color correction, sound design, etc.  But, again, be careful. You can often get a quote for color correction that could be near $20,000 through a fancy post-production house.  Or, you can find a freelancer, scale back the amount of correction you really need and you can probably get it done for a tenth of the cost.

Your budget must tell a story and make sense.  Spend time making it as easy to read as possible.  You don’t have to have a huge Hollywood-style budget if you aren’t using half of the line items.  And make sure the budget matches the scope --if you write up a long description in a grant proposal for audience engagement, then you need to have a corresponding cost that makes sense. 

If in that instance a funder asks you what your budget is, own it and be able to defend it.  Don’t fumble around and say, “Well, I could do it for this or that.” All budgets are different due to the scope of the film, there is no “right” number or one-size fits all answer.

Lastly, grant funding for documentaries is beyond competitive.  It’s the equivalent of getting into Harvard, maybe harder, and you are competing against established filmmakers that the funders know and want to fund.  So, if you are committed to making your film no matter what, you need to make a budget that you can live with and assumes you may only raise a fraction of the ideal final budget.  This is reality for most documentary filmmakers, especially first-timers. 

Attending Peer Pitch also reminded me that there are so many incredibly talented first-time filmmakers and I wish there was 100 times the funding and distribution opportunities than there are now so that all these unique voices could find their audience.  In the meantime, we, as a community, need to talk openly and transparently about these issues to protect each other from unmanageable debt or from distribution deals that prey on our vulnerability. 

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