Six Things You Absolutely MUST Know Before Approaching Film Investors
Six Things You Absolutely MUST Know Before Approaching Film Investors

Six Things You Absolutely MUST Know

Before Approaching Film Investors

I am often consulted by film and stage producers who tell me they are ready to start work on raising the financing for their films/ plays/ musicals, or what-have-you, but often as not, as we get to work, it becomes clear that they’re not as ready as they think.

Gordon P. Firemark

Too many filmmakers jump the fundraising gun and post notices on facebook, twitter, or their websites saying “we’re now looking for $1 Million” to produce this film/show.” Guess what… game over!

Before going out to film investors, it’s important to have your ducks in a row. Knowing the following six things before you start raising money will dramatically streamline the process, and get you closer to funding, faster.

1) Know Your Product

What is a producer’s product? Well, it seems obvious, right? A film/show about X, Y and Z. But is it really? Well, at this point, you are talking about maybe someday making a film about X, Y, and Z… but that is not a product (yet)… it’s a dream.

Right now… while you’re “in development” your product is an investment opportunity. Now, of course you need to have a script, a crew, cast and a plan… and you better know who is going to come see the thing and why.

2) Know Your Customer(s)

So, who is your customer? At first blush, you might revert to thinking about your audience, and obviously, you DO need to know where your audience is and how you will eventually sell them a ticket… but again, right now, you are selling a dream. That opportunity mentioned above. Who will buy that? If you answered “Investors”… you are partially correct. But, if that is all you said, you have a lot of work ahead of you.

What does the ideal investor look like to you? What is his or her name, age, job, marital status? Do they have kids? Do they travel? Where? How Often? Where do they congregate? How will you meet this person? It is incumbent on you, the producer, to answer the question, Why would this person invest in your project? What motivates him or her? What would be the most persuasive thing you can say or do to get him or her on board?

3) Know Your Budget

It is amazing to me that people think they are ready to go around asking people for money for their projects before they even have a clear picture of how much they will need, and to where that money is going. The job of producing is essentially the job of managing the finances of a project. Leaving aside the fact that you need this information to prepare the legal documents… you need this information for your own internal purposes. Too often producers figure, I’ll do my project with whatever funds I can raise… but don't have a real film business plan. Would you invest YOUR hard-earned cash in someone who says “I don’t know” to the question “How much do you need?”

4) Know Your Market

Now we are talking about how you are going to sell your project, and to whom. What will the market bear? What ticket price is the “sweet spot”. Will distributors buy this project for distribution? Will they pay sufficient money to make the project financially feasible? Will audiences like it? Will they PAY to see it? Will they TRAVEL to see it? Why? Why not?

5) Know the Rules

Too many filmmakers jump the fundraising gun and post notices on facebook, twitter, or their websites saying “we’re now looking for $1 Million” to produce this film/show.” Guess what… game over! Most film/theatre projects are financed through a ‘limited’ or ‘private’ offering exempt from the otherwise expensive and time consuming securities registration requirements.

Under these exemptions, advertising the offering is NOT allowed. Other restrictions address WHOM you may approach, and what information you must provide. If you haven’t studied these rules, and figured out how you’re going to comply with them, consult an entertainment attorney or securities lawyer who handles this kind of thing. Doing it yourself is a recipe for disaster.

6) Know What You're Really Offering...and How You're Going to Sell It

Sure, in #1, we talked about your product, but is that really what you’re offering/selling? Investment opportunities abound for folks with money. So, what is it really that you’re offering? You are not just selling an opportunity to invest in any old business…you are selling the chance to be a part of a film, play, musical or whatever. Maybe even to have a credit as an executive producer, or just a “special thanks” mention. Regardless, you’re selling a fantasy… a dream. Do you know how you’re going to do that?

Gordon P. Firemark Entertainment Attorney

What You Absolutely MUST Know Before Approaching Investors for your Film / Play / Musical is written in collaboration with Gordon P. Firemark, an entertainment attorney devoted to the representation of artists, writers, producers and directors in the fields of theater, film, television and music.

Mr. Firemark is the producer and host of Entertainment Law Update, a podcast for artists and professionals in the entertainment industries and the the author of The Podcast, Blog and New Media Producer’s Legal Survival Guide.

His practice also covers intellectual property, cyberspace, new media and business/corporate matters for clients in the entertainment industry. The Law Offices of Gordon P. Firemark offer the kinds of legal and business-affairs services handled in-house at larger studios, production companies, talent agencies and record labels, which allows small and mid-sized entertainment businesses, individual producers, writers and artists to reliably and efficiently out-source their legal and business affairs work.

More Info: Law Offices of Gordon P. Firemark; Theatre, Film, TV & New Media

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