Raising
financing for a film has become such a hair-raising and
complex task it's almost as creative and difficult a process
as making the damned film itself. Ultimately it all depends
on your film's budget. Generally, if it is a very low budget
project then financing it is fairly easy. If it's a medium
sized budget it may actually more difficult to finance than
a higher budget film. Go figure.
Remember
if you want to finance anything besides a very low-low budget
film, you will probably need a detailed business plan. This
should include such things as a break down of the budget,
marketing plans, intended audience, biographies of key people,
synopsis, a cash flow projection as well as (if the budget
is not extremely low) some projection of potential sales
around the world. Sales projections are difficult to arrange
in South Africa because there are no true film sales agents
in the country who can work this out. If you must, leave
this out for now and convince a potential investor to cough
up to have this done internationally. Below are a number
of strategies to fund your film.
INVESTORS
This covers a wide range of people and organisations. There
are two main types: "Non film Industry investors"
and "film industry investors".
The
Non Film Industry Sources: This is usually someone
with delusions of seeing their name up in lights. They
probably want at the very least an executive producer
credit. They are wealthy and even though he or she may
own a successful shoe company all they've ever really
wanted to be was an actor. This category also includes
your rich Uncle Rory. The danger here is that the person
or organisation probably knows very little about the film
industry and film production. They may not understand
why certain things are done and may be very disappointed
(and blame you) if the film is not the next "Titanic".
They may also begin to meddle in the process of production.
However if you've warned the investors/s that films are
not always (in fact rarely) a sure fire hit then go for
it.
The
Film Industry Sources: This is a person or company
that finances films as part of its usual business. This
could include a wide range of investors, from distributors,
to broadcasters, to studios and individuals who not only
invest their money into projects but also access money
from other similar sources themselves.
NON
FILM INDUSTRY SOURCES
A
RICH UNCLE
If you have a member of the family that is fairly wealthy
then you may convince them to contribute towards a low
budget film. Only if your uncle is extremely, extremely
wealthy (we're talking Bill Gates here) will he finance
a higher budget film. Be warned. Your uncle may not get
his money back and this could strain family relations.
Don't sucker your uncle and tell him that it's guaranteed
that your film will make money.
CREDIT
CARDS
Many a confident filmmaker has financed his or her very
low budget picture on their credit cards. The idea here
is to apply for as many credit cards as possible and then
pray like hell that you'll be able to pay them back. This
is very risky and only applicable to very low budget productions.
Use this option in moderation.
THE
BANK
It's almost impossible to convince a bank to finance a
film. Banks don't know anything about the film industry
and feel that it's better not to meddle in a field that
they have no business expertise in. The business side
of filmmaking after all is much more like gambling than
business. The only way you'll manage to get money from
the bank is if another organisation or investor agrees
to stand surety for the amount if the project does not
succeed financially. Certain banks in the USA are more
open to funding independent films.
FUNDRAISING
Another option for low budget projects. Throw a party
or a rave and convince people to pay to get in. Sleep
with the owner of a very hot club, throw a fundraising
bash there and keep all the takings from the door. If
you combine these takings with your rich uncle's gift
and a stack of credit cards you might just have the budget
to make a low budget film. Remember we take no responsibility
if you are declared bankrupt - we're not financial advisors.
FILM
INDUSTRY INVESTORS
STUDIOS
There is a no real studio system in South Africa at the
moment. Studios can get involved in a project at various
stages - from right at the beginning by commissioning
a script or simply buying the finished product for distribution.
Some studios are also distribution companies.
BROADCASTERS
In South Africa, broadcasters (specifically the SABC )
are the largest funders of television films, series and
documentaries. The best way to raise financing through
broadcasters is to send the relevant commissioning editor
a proposal, script and business plan. (Getting feedback
could take a while.) The broadcaster may also be willing
to pre-buy the film if they believe in it, or they may
give you a letter of intent that they wish to do so when
it is completed (subject to a number of conditions of
course). This letter can also be used to help secure other
financing. If you have some pre-sale before the film is
made investors will more easily hand you money as they
have some guarantee that the project will be sold. (See
our Broadcaster listings on our Organisations Page for
more info)
DISTRIBUTORS
Most distribution companies do not usually finance films,
but some do. Some may like a project so much that they
may wish to secure the rights to it and will thus invest
in the film before it is made. Or they may already "sel"
the rights to the film before it is made to broadcasters.
This is known as a pre-sale. If you make a lot of pre-sales
you may be able to secure enough funding to make your
film. Sometimes a distributor may simply write a letter
stating their interest in buying the rights to the film
when it is made. This may help you secure financing from
other sources. If you have some kind if distribution deal
before the film is made investors will more easily hand
you money as they have some guarantee that the project
will be sold. Remember that it is best that a theatrical
distributor first buys your film because films that are
theatrically released become more valuable when up for
sale to television, satellite and video distributors than
non-theatrically released films. (See our Distributor
listings in our Organisations Page for more info)
CO-PRODUCTION
If your project has some international appeal you may
be able to secure a co-production agreement. For example
a South African Broadcaster may co-produce a project together
with a British broadcaster, or Production Company. You
should contact other international sources of funding
if you believe you may be able to secure local funding.
Some co-productions are given government sanction if they
take place between two countries that have signed a co-production
agreement. The agreement between these two countries has
benefits for each country's industry. Currently South
Africa has co-production agreements with Canada and France.
Co-production governments may also assist and facilitate
the funding and production of a project. Remember however
that there must be an element of both countries in the
project for an official co-production to occur - this
may include characters from both countries, settings,
as well as crew or cast from both countries. Contact the
Department of Arts and Culture (see our Organisation page
for contact details), or your own government arts foundation
to find out which countries your country has signed co-production
agreements with.
OTHER
STRATEGIES
GRANTS
Until recently there were no such things as film grants
in South Africa. Now there is some hope. While some countries
have a large array of grants from local councils and other
public arts funding, we are less blessed in South Africa.
Currently there are only a few government agencies that
do so. The National Film and Video Foundation grants funding
to a variety of film projects - from shorts to feature
films as well as script development. Filmmakers are invited
to submit proposals annually. You can also try other government
departments if the project is related to their area of
work. You could also try and convince large companies
to sponsor your project in return for advertising or product
placement. (See our Grants listings on our Organisations
Page for more info)
DEFERRED
PAYMENTS
Cutting costs might not finance your film but may allow
you to lower your budget to be able to get enough financing
to make it. One way to do this is to defer costs. Usually
one pays the crew and cast during production and at the
completion of the film. If your project is a very low
budget film and won't take too long to make, you may be
able to convince cast and crew to defer their payments.
This means that you do not have to pay them their agreed
salary or parts thereof until such time as the film begins
to make a profit. You may also offer them percentage points
in the film's profit instead of a salary. This is a clever
and fair way of making your lower budget film a reality.
You should put together a contract which will lay out
this agreement with your cast and crew.
WORD
OF ADVICE
When dealing with investors of any kind, always get a
knowledgeable lawyer to help you out. Film financing is
astoundingly complex and you'll need someone to look after
your interests. To learn more about your rights when signing
a distribution deal read Mark Litwak's Filmmaker's Bill
of Rights.
A
CASE STUDY
We at Underdog financed a half-hour short dramatic film
for around R14 000 ($2800,00). It was shot on 16mm, and
finished on video. It was screened at various film festivals
and made a small profit when it was bought by the broadcaster
M-Net for screening on Satellite TV across Africa.
This
is how we did it:
Credit
Cards: By using our credit cards we were able to
cover small costs that we didn't have cash for such as
catering - yes cast and crew takeaways fell under this.
Family
Gift: The producer's family contributed a small
sum of money to the production.
Fundraising:
The film had a gay theme so we threw a fundraising party
at a gay club and appealed to the gay community to help
in the making of the film. A performance by a leading
drag artist was arranged and a date with the lead actor
was auctioned off to the drooling crowd. We made very
little money (but it's the experience that will remain
in our minds not the profit).
Cutting
Costs: We already knew and had had worked with
a number of people and companies in the film industry.
We convinced them that they would be helping to make art
and everyone from the lab, to crew, to postproduction
facilities gave us down time and equipment for free or
at a very good rate. We also deferred the payments for
the vast majority of the cast and crew.
