There is no secret formula for raising money. Peter W. Rea and David K. Irving list seven sources of funding for short films and how to approach them.
There is no secret formula or key to success in raising money. In the pursuit of funding, it is almost guaranteed that you will come up against tremendous odds and constant rejection. Many will say no before one says yes. Some may even say yes, and then say no. To be able to sustain excitement for your beloved project after weeks, months, and sometimes, years of effort, demand a strong belief in yourself, the utmost patience and perseverance, and an unbridled passion for the medium and your message.
Although short narrative films and videos vary in cost, we have found that the average is approximately $750 per minute. Therefore, a ten-minute film will cost around $7,500, and a 30-minute film, $22,500. The figures are less for video productions. In documentary, the decision whether to shoot in film or video impacts greatly on the price.
There are no rules when it comes to finding money. If you win the lottery, use it to finance your project. Putting the lottery windfall aside, here are seven possible sources of money for short films and videos.
Private Investors
This group includes any private individuals interested in investing in your project from friends, family, and associates to complete strangers. They may be investing because they want to see you succeed even though they understand they might not see a return on their investment. They may be looking for a tax shelter. Or, they may be shrewd business people who believe in the investment opportunities and market potential of your project. Private and public corporations do fund films and videos. Mobil and Sony have traditionally backed public television shows. The public relations person at these corporations will know how to guide you to applications for various proposals. Contact as many companies as you can. To prevent you from wasting time, research the type of projects these companies have funded in the past.
Public Foundation Grants
There public corporations financed by federal, state, and local governments that offer grants and other forms of financial aid. The National Endowment for the Arts (NEA), The National Endowment for the Humanities (NEH), and the American Film Institute (AFI) are three examples.
Private Foundation Grants
There are thousands of private foundations but only a few that support film and video projects. Finding the one(s) that might be interested in your particular project requires exploration. Most major cities have a foundations section in the public library. Examples of sources of media fellowships are the Jerome Foundation and the Rockefeller Foundation.
Bank Loans
Banks will loan almost anyone money if borrower provides sufficient collateral. Taking out a loan against a car, a boat or a house can provide adequate funding for a short film or video project. The money is not a gift or an investment, and it will have to be paid back, with interest.
Personal Savings
If the cost of a short work is not exorbitant, investing in yourself with personal savings can provide sufficient support. Saving money over time in an account earmarked for your project may take less time than you think. Although a financial advisor may try to convince you that your savings is for the future, or for hard times, investing in yourself can also a way of protecting your future.
In Kind Services and Donations
Anything that is given or donated is called “in-kind” and is the equivalent of hard cash. If 70% of your total costs are raised as currency, and the remainder in the form of goods or services, it equals 100% of your budget. Examples of in-kind donations are food from a local restaurant, deferred laboratory fees, reduced car or van rental and a free location.
These donations are usually given in exchange for a screen credit and for the good will. Shooting in your hometown might inspire newspaper articles featuring “home-town-boy/girl-makes-good” often inspiring favorable public relations with businesses that translate into money or in-kind donations.
There is also a practice in the business called product placement.
This is when a producer convinces a manufacturer to donate goods to the production in exchange for featuring its product in a film or video. For example, Ford would loan cars to a production for use both on and off camera with the agreement that Ford cars and trucks be used prominently in the film. This works for costuming the same way should the producer interest a clothing manufacturer.
Other in-kind opportunities that exist for independent media artists are:
- Low-cost
or free access production or post-production equipment and facilities.
- Financial
support for artists facing work related personal emergencies.
- Information on or assistance with taxes, record keeping, accounting, or financial management.
- Free legal advice or referrals.
The Prospectus
To attract private or corporate support, filmmaker needs create a proposal or prospectus. This should excite potential investors by communicating on paper a strong sense of the project in a professional manner. The information gathered for the prospectus can easily be rewritten to fulfill a grant application.
The prospectus should minimally contain:
(1) A cover letter.
(2) A cover or title page.
(3) The one-liner.
(4) A synopsis of the story.
(5) Some history, backstory of the project.
(6) Research (Documentary).
(7) Top sheet of budget.
(8) Production schedule.
(9) Cast list.
(10) Brief resumes of creative team.
(11) The market for the project.
(12) Financial statement.
(13) Means of transferring funds.
(1)
Cover Letter.
letter introduces the project to the investor. It can be targeted to all investors or slanted to specific individuals. The impression you make with this letter sets the tone for everything that comes after. Be clear about what you want. Are you asking for many small investments? Donations? What is the total amount of capital you are trying to raise?
(2) Title Page. A Title Page is important. A good title conveys the essence of the project. Keep it short. It will have more punch. Include some artwork on the cover page that catches the eye and gives an immediate impression. The right image can capture the feel and tone of your piece. Artwork here or anywhere in the prospectus must look professional.
(3) The One-Liner. The One-Liner is a statement of your project. Knowing how to prepare easy-to-read, written communications can save you time and frustration. Use simple declarative sentences and clear unpretentious Arrange thoughts logically, stay away from jargon, make the words flow.
(4) Synopsis of Story. This is a brief narrative of the story’s action. It should not get bogged down in details that don’t move the story or plot. The synopsis is difficult to write because one wants to capture the flavor of the piece and tell the story at the same time.
(5) Some History, Backstory of the Project. Briefly describe how the project evolved. Elaborate on the subject matter and what inspired you to want to make this film or video. This is especially applicable if the idea comes from another medium (stage, short story, etc.).
(6) Research. This is imperative for a documentary project. The potential investor will need to understand the materials on which your story is based. Is this a true story of a living character? An event? Has the story been done before? What slant will the director take? Have the rights to tell this story been secured?
(7) Top Sheet. Summarize the budget. This digest should represent the broad categories, not a detailed or itemized breakdown. Too much information might prompt an investor to question why you need $400 for a special wig. You don’t want to end up justifying this and every cost of the project. They need to trust that you are the expert. It is your business, not theirs.
You may be able to complete the project for less than your projection, but ask for more than you anticipate. Who knows, you might get it and you might need it.
(8)
Production Schedule.
Approximate the dates when the production might begin and end should financing become available.
(9) Cast List. Draw up a list of the prominent cast members plus a succinct resume of their credits. The quality and ability (and in some cases recognizability) of the cast are part of the insurance the investor will require to feel confidant that his money is being spent wisely. Casting is essentially the domain of the director. Her input into this list is imperative.
(10) Brief Resumes of the Creative Team. Present the pool of talent associated with the production at the time the prospectus is written. The personnel can be introduced in simple paragraphs or in a complete resume.
Writing a resume is an art in itself. It can be anywhere from a single paragraph to a full page in length. Try to find a balance between giving too much and too little information. It must be made clear what the person’s strengths are, what his relevant experiences have been, and what, his job description will be. A resume for the producer that indicates he can write, direct, produce, shoot, and act may overwhelm an investor.
Having said that, we remind you that there are no rules. An eclectic resume may indeed catch an investor’s eye. Listing work experience such as camp counselor, location scout, or editor of a student film all point to leadership skills. Remember not all potential investors will know how to judge the subtleties of a varied background.
(11) The Market for the Film. Devise a distribution plan.
(12)
Financial Statement.
Project income based on distribution plan. Explain your business identity. If you can offer an investor any sort of tax break, there will be a greater chance of attracting the financing. Tax breaks are allowed if your company is a not-for-profit company. Consult an entertainment attorney.
(13) The Means of Transferring Funds. A letter at the back of the prospectus addressed from the investor to the company is a commitment from the investor for a specific figure. The letter will show how money can be transferred to the production account. GRAPHICS The prospectus can be peppered with graphics that support the project’s concept and lends visceral excitement to the presentation. People respond to visuals. If you can come up with images that connect the potential investor to the idea of your piece, it can enhance their appreciation of the support data. PRESENTATION IS EVERYTHING In writing the prospectus, use easy-to-understand and grammatically precise gives a professional impression. Don’t give the potential investor any obvious reasons to turn down your proposal. “No” is the easiest decision to make because there is nothing at risk by making it. In fact, most people look for reasons to say it. Imagine yourself on the other side of the table. Would you support someone whose business plan wasn’t thought out carefully or who didn’t take the time to proof his work? Would you trust him with your money?
Euphoria Is Not Enough
The prospectus forces the filmmaker to think objectively about the project as a whole. The challenge becomes how to communicate an idea’s potential to a complete stranger who may not be interested in your project? Beginners think that enthusiasm is enough to sell an idea. This energy can be contagious, but it also must be followed by hard information about the exact nature of the project, the talent, and the investment structure.
By-Products
The prospectus is an important tool to galvanize interest without having to pitch verbally to hundreds of people. It also filters out the sincerely interested parties whose concerns can then be addressed specifically and personally. There are producers who are naturally facile and relaxed communicators. You may be one. Whether you have an innate ability to sell in person, the written presentation must be well designed. The interpersonal skills will come in time.
The by-product of a thoroughly prepared prospectus is twofold. First, it trains you to think logically and sequentially about your idea so that when you do have the opportunity to speak face to face with potential investors, you will be well prepared. Second, it is the first important step in the pre-production process. Now you have your first budget!
SPENDING THE MONEY RESPONSIBLY The producer has the responsibility of handling and managing the money after it is raised. You will need to create some type of corporate identity to receive funds. This may involve something as simple as setting up a bank account in which checks can be deposited or as complex as choosing a corporate structure. You can consult an entertainment attorney for details.
business legal skills required are based on the needs of the production. Throughout the production process, the producer then supervises the allocation of cash or “cash flow” through the production pipeline. This insures that he will be able to deliver a thorough financial statement to the investors at the end of production.
In the verbal and the written pitch, present a tone that grabs the listener/reader’s attention. Use active and colorful words. Some people have a talent for this type of promotional presentation. A director’s raw enthusiasm, coupled with a clear interpretation of the material, makes an effective presentation.
In a verbal presentation, be enthusiastic but speak clearly and slowly. When pitching material with a partner, know when to be silent and when to assist. If you seem like a cohesive team, your audience will be impressed.
GENERAL FUNDRAISING SUGGESTIONS
Be Positive
You need to be able to sustain a positive attitude over the long haul. If you are the kind of person who requires short-term rewards, this business is not for you. Patience and perseverance are the watch words; the energy of the hare but the patience of the tortoise. Looking for money requires a dogged determinism. Project supreme confidence in the picture and your ability to execute it successfully. People are investing not only in the picture, but in you.
Act Professionally
Professionalism is a theme we stress in all aspects of the production process and is vital when you approach potential investors. You will be respected if you appear organized, efficient, well prepared, and articulate. You may see yourself in the role of the “artist,” but this is a business proposition. You are asking people to trust you with their money. If you can give the impression of knowing what you are doing, you will most likely get your foot in the door. But once in, given that there is quality and substance in your project idea, a coherent presentation will be critical to your success.
Be Informed
In looking for funding sources, knowing what information to seek is as important as knowing where to find it and what to do with it. The goal is to know the way things work and how to work them to your advantage. Read as much as you can. Become adept at asking the right questions. Examine budgets of pictures with a similar length.
Be dogged in pursuit of the facts. Examine all sides of a problem. There may be more than one solution. Go to conferences. Talk to professionals and amateurs who have been successful at fundraising, particularly in areas with genres similar to your project. Then, evaluate the potential investor pool.
The key here is to consider everything. Don’t focus all your energies on one particular strategy. Pinning your hopes on getting that one grant or investor that then doesn’t work out will leave you stranded. Learn to keep many balls in the air and learn to live with rejection. It may take 100 “no’s” before you finally hear one “yes.”
Patience is an integral part of raising money. This doesn’t happen overnight. If you are planning on shooting in several months, and have not yet begun to fund raise, you’d better hope that you win the lottery.
FUNDRAISING TIP:
Financing can be secured in two tiers. There is the money to get the project shot and “in the can.” This money is raised on a script and a pitch. Once this is done, you will require “finishing” or post-production moneys. This second phase of fundraising can be done while the project is being cut and you can use the footage to show potential investors just how fabulous the show will eventually be. As opposed to the first moneys, which were raised on the ephemeral qualities of a pitch and a prayer, having footage to show makes a more solid presentation.
And don’t be shy. Believe it or not, people like to share their knowledge with beginners as long as it doesn’t cost them anything.
WHAT HELP IS AVAILABLE TO STUDENTS?
Share information with other students benefit from their experience.
These invaluable resources that can translate into solid advice and information. Who better to ask for fundraising advice than fellow students who are in your same position? Many students, surprisingly, overlook their peers as a resource. It is up to the producer to brainstorm with others seeking production support.
Internships
If your film and television program is located in a media center like New York, Los Angeles, Chicago, or San Francisco, it behooves you to take advantage of internship opportunities to learn about not only the raising, but also the management of money.
Fundraising Strategies
You need to generate interest and create energy around your project. Set up fund-raisers, have parties, hold screenings of unfinished work. Use the newspapers. Invent publicity by creating a press packet to send to the papers and magazines. Entrepreneurial students capitalize on their skills by creating product to sell. Hard cash is being made each week by those who know how to bake, sing at weddings, garden, flower arrange, do accounting, type, trouble shoot computers and videotape weddings.
You don’t necessarily need to look only for big dollar investments. Make a list of everyone you know, everyone your parents, relatives and friends know, and ask them for a modest amount from $15.00 and up. They will be surprised when you ask for a small amount and will gladly donate a few dollars to the cause. Twenty-five friends each giving $25 is $625! This is enough to buy and process 5 rolls of 16mm film or 60 rolls of tape stock!
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