Excellent information from Zensteve.
With an indie film it's almost impossible to predict the return, it all depends on how many territories you sell into, whether your product can find a slot in the direct to DVD market and whether it is suitable for TV. It is unlikely that with a lo/no budget film that you'll get a one hit distribution buyout that will get all of your money back to you in one shot. You may have to spend the next couple of years with your film bringing back smaller pots of money from various deals.
However, the important thing on your film isn't your budget, but whether it's obvious that you didn't have the budget. The hardest thing to learn in indie film making, is how to make your $50,000 dollar budget look like you spent $500,000.
If your film looks like you spent $500,000, you've a much better chance of getting distribution. The phrase used most often by indie filmmakers when asked about their budgets is "It cost less than a $1,000,000." Providing your film looks like it was closer to the top end of that figure than say $250, it unlikely that distributors will want to know anymore than that.
One of the key points in making that sale is shooting on a professional format (Unless you are Danny Boyle, of course) super 16mm, 35mmm film, High Def video or at the very, very least Digi Beta or an equivalent Panazonic's DVC Pro 50 for instance.
it is possible to shoot a feature on miniDv, DVCAm etc, but your chances of large scale distribution will fade considerably.
The good news is that horror is a genre that generally sells well in the direct to DVD market globally, is well known for performing even when there are no names in it and can sell even if the script, acting and cinematography are bad.
There is a book called the "The Guerilla Film Makers Handbook" the isbn is 0-8264-4713-9
It's writen by indie filmamekrs and has lots stories about what happened to the films once they got into the market place. It's very depressing reading, but at least it gives a realistic picture of the nature if the indie film business. It also has charts with potential return figures on indie films. I use it all the time whn I'm putting presentations together for investors, so they know exactly what hte realities of the business are.
