I was wondering if anyone here knows anything about starting an indie film studio? I tried to start a business plan from a small business development center and I had it cancel everything because they just don't understand the art of independent film and didn't think selling independent movies online was a good idea. They were giving me all these horrible sell out suggestions which I told them no and they got angry with me and I said to forget it and canceled. Plus I never got any start up money, loan solutions that I can pay back, and there's tons of laws regarding fundraising and donations and IRS stuff that just went over my head and caused me stress to figure it out. I called the IRS to find out my state laws and no one knew of any further information. It was stressful development since December. Anyone have any advice regarding starting an independent film studio?
How to start an indie movie studio
- Thread starter comedyfilmmaker
- Start date
An indie movie studio is no different than any company. A manufacturing company
buys or rents a building and makes a product. An auto repair company buys or rents
a building and fixes cars. An indie movie studio makes movies. And they are all started
in the same way.
There is a "small business association" in most cities - they can help you with legal
matters. They may not understand the art of independent film - so what. You
understand the art of independent film - they can help with the legal aspects of starting
a business. You say you never got any start up money. So what? then look for other
investors. You didn't think it was going to be easy did you? Getting investors to make
movies is difficult. Getting a business loan for an extremely high risk business is very
difficult. All the legal aspects of starting an extremely high risk business is going to cause
you stress. Did you think it was easy?
Start your business as you would any business. In your case your business is making
movies. But the legal aspects of the business are no different than if you were starting a
restaurant, a car repair business or opening a plumbing business.
buys or rents a building and makes a product. An auto repair company buys or rents
a building and fixes cars. An indie movie studio makes movies. And they are all started
in the same way.
There is a "small business association" in most cities - they can help you with legal
matters. They may not understand the art of independent film - so what. You
understand the art of independent film - they can help with the legal aspects of starting
a business. You say you never got any start up money. So what? then look for other
investors. You didn't think it was going to be easy did you? Getting investors to make
movies is difficult. Getting a business loan for an extremely high risk business is very
difficult. All the legal aspects of starting an extremely high risk business is going to cause
you stress. Did you think it was easy?
Start your business as you would any business. In your case your business is making
movies. But the legal aspects of the business are no different than if you were starting a
restaurant, a car repair business or opening a plumbing business.
Yeah, the reason why my state small business development center was giving me a hard time was because they knew what I was doing was a high risk and I guess they wanted nothing more to do with me unless I sell my work someone else or don't be independent. Math isn't my best subject and I wanted to hire special people to organize and do all the legal stuff for me if the business were to get off the ground so I would give me more relief to create. Perhaps it's not very logical, I don't know. It makes me wonder how Troma can survive for 40 years, I know it's possible because I see websites of independent film makers selling DVDs, and memorabilia. Plus taxes and such, it's all very confusing.
Troma changed their business model a while back. I understand they moved from making their money selling their own B grade films to distribution. AFAIK they still make movies, but distribution is what keeps them afloat.
There's a video called "Make your own damned movie" where troma attempts to show you in their own way, how to make your own B grade movie. It's poor quality, but may be worth watching if you're looking at moving into that space. If I remember towards the last discs is about the film markets, which is probably relevant to you and will help you understand how they've stayed in business for 40 years.
Banks tend not to loan for anything risks unless you have sufficient collateral. That being said, it's often easy to get them to do a Gap loan. Just follow a step by step formula.
To the OP:
I suggest that you grab yourself a copy of Film Production Management 3rd edition. Read it cover to cover. If after reading that book you're not excited for the material change your plan. Some people want to take up the role of producing to get the glamorous role of director. If you're not made for that, you may become miserable pursuing your dream.
Business is all about making money, and no one will invest unless they have a reasonable expectation of - at the very least - recouping their investment. Investors become involved with start-ups when the person(s) putting forth the business plan have a track record. Without a record of prior successful performance the risks are just too high. This is true even when the person(s) initiating the start-up are risking a substantial amount of their own capital.
So if you have a track record and are willing to put your own money alongside the investors stake you at least have a chance. Otherwise you are not going to generate much interest.
The very first thing you need to do is list your own assets. How much do you have invested? You will have to match dollar for dollar in many cases; you put in $200k, they will put in $100k. The second thing is to list your accomplishments. How much money have you made producing independent films? Those are the things your potential business partners will be looking at.
Your best option at this time is to enter into a partnership with other filmmakers; pool your resources. Your biggest initial challenge will be delegating responsibilities, both corporately (meaning who is responsible for what) and the hierarchy - who is ultimately in charge and makes the decisions. Most indie types want to do thing their way and, like many indie bands, fall apart when it comes down to having to one person deciding what everyone else is going to do; they ALL will want a big say in the direction of the groups financial and artistic direction.
So if you have a track record and are willing to put your own money alongside the investors stake you at least have a chance. Otherwise you are not going to generate much interest.
The very first thing you need to do is list your own assets. How much do you have invested? You will have to match dollar for dollar in many cases; you put in $200k, they will put in $100k. The second thing is to list your accomplishments. How much money have you made producing independent films? Those are the things your potential business partners will be looking at.
Your best option at this time is to enter into a partnership with other filmmakers; pool your resources. Your biggest initial challenge will be delegating responsibilities, both corporately (meaning who is responsible for what) and the hierarchy - who is ultimately in charge and makes the decisions. Most indie types want to do thing their way and, like many indie bands, fall apart when it comes down to having to one person deciding what everyone else is going to do; they ALL will want a big say in the direction of the groups financial and artistic direction.
Just curious what you meant by distribution. Is it like using internet video to help market the movies?
I have the Make Your Own Damn Movie DVD Set, just curious which discs that would be.
How does a Gap Loan work?
One of the big problems that I had with that small business development center is that I kept telling them when looking for help starting up a business was whatever decision of direction, I didn't want anything to interfere my art in anyway. This meant by any means of people coming in to alter what I create or anything I create being altered just for business reasons for the work to be sold. And I always believed as an artist that art is meant to be the voice and expression of the artist and not just another meaningless product to be sold just for the sake of it. It seems like art and business is so difficult to cooperate together. The strange thing is I know exactly what I want to do. I want to make movies, and webshows and even little merchandise like t-shirts and stuff to be sold on a website and sell the movies through indie friendly stores and rental stores, Amazon, etc. But what seems to be difficult is finding start up money when I'm basically broke and don't get that much being unemployed. As well as finding the right people who understand exactly what I'm doing and what art is all about and how an artist can make an honest buck without doing something unethical to the artists' personal beliefs and the work itself. I remember that small business guy who yelled at me told me that no one is going to give me a loan unless if I proved to the banks that another company was going to buy the exact amount of my DVDs and everything which I found really weird because I told this guy that predicting something as simple as food to a grocery store would make more sense to that logic knowing exact amounts because everyone eats food and grocery stores sell it, that's that. But film is different because it's in the matter of interest. Some people like this kind of film, some don't so it's very difficult to say how much money is going to come out of all this. He gave me a hard time and just didn't want to see things from my point of view. It's like this guy just didn't have any patience to understand what art means to an artist. And really the only reason why I want to have an indie movie studio business in the first place is to make art and share it with like minded people, have a place outside my own apartment to work, have more space to video edit and most of the production (I mostly do animation but I want to get into motion capture and live action filmed in studio filming) and when it comes to money, if I make a great income that's good but as long as I have enough money to live on, that's really all that matters to me. Doing good work. And to even hire like minded people to just go to work and have fun, have a good time making art that matters to all of us. Unfortunately it just doesn't seem simple enough in the eye of business which I don't understand why it just can't be in indie small business. Sure I understand fully about the bills that need to be paid just to keep a roof over the head on everything. But just all these complications that go over my head regarding taxes, specific on every single penny to show all these people how you'll spend their money. I can understand in terms of I'm just this new person to them and they want to make sure I'm not going to be a fraud using someone elses money. I can understand that logic and the security on that but when it comes to predicting how much money is going to come in every month before I start making anything and getting a bunch of useless anti-art suggestions. It begins to just tear my soul about as an artist. I remember this guy shouted at me saying that every suggestion he ever made to me, I always tried to figure out a way to go around it which I don't think is a bad thing, it's creative decision making. It's like all strikes against me at that point. I've tried the pitching to Hollywood sort of route before making this decision. Hollywood is completely blocked off if you don't know any referrals for an agent or whatever, all these unions, no one wants unsolicited material. I have pitched to two tv networks which I felt were the best people who would respect my art and give me a bit of spotlight. They turned it down because of lack of interest and also they thought my work was too high brow not made for the audience and it was going to alienate them and lose business and be a waste of time for the network. I always kept my belief that an artist doesn't make something for the audience, they make something for themselves and share it with the world, and the fans will follow if they can relate or have interest in it. I basically wanted to escape everything that I felt would harm my artistic vision and wanted to just control the business myself, but it almost seems like the artist can't win in the business world which is quite disappointing in my opinion. I wanted to just fundraise and get donations to help support my work but there's all these laws on taxes and It's so confusing. If it's non-profit, the easier it is to a certain amount, but if it's to start up a profit business, then it seems to be unacceptable. The one answer I always get when asking people legal questions is "I don't know, you might want to hire an attorney to ask that one" And I tried, and I just can't afford it. I almost got charged just for setting an appointment to ask one question so I didn't bother right now. UGH! It's really frustrating.
This, I think, mostly likely sums up both sides of the conversation(s) you've been having.
This is going to perhaps sound a bit harsh, but I mean it in the best way possible.
If you want to make a business, you have to realize it is just that, a BUSINESS. "Creative decision making" doesn't include ignoring reality. It's a business, people have to eat. When people work for you, you have to feed them, house them, keep them and their families healthy.
We'd ALL love to just have someone give us money to do this. And when it's all gone, sigh, shrug and go "meh" and move on to the next investor.
Many of us here toil at fulltime jobs (and then some) using what we can to pick up gear here and there and actually MAKE shorts and/or features in whatever time is left over. Not only does that show some level of actual commitment, but we'll have gear, experience and a showreel for when a decent opportunity comes up.
This... is so very hard to read from someone who's worked in commercial financing and owned a few small businesses. I'm starting to feel sorry for the SBDC guy.
You don't understand that someone who's giving you money would, at the absolute very least, want to know how it's being spent? You need to re-read that quote until you can appreciate the absurdity in it before you'll get anywhere on this path. You'll have better luck buying lottery tickets I'm afraid.
Take some of the other advice in this thread. Partner with people, get stuff made, get a name. I was able to partner with someone who was very good at the financial/business aspect of things, allowing me to focus on the technical & creative side. Perhaps you'll have the same good fortune.
Good luck.
CraigL
Correction: I gave you the wrong book, I meant to give you the title of Producer's Business Handbook. Sorry about that. Film Production Management is about being a UPM, a very helpful book for you to learn, but not what I meant to suggest you read.
Distribution is mostly about getting paid. Selling the movies. While marketing is a part of that process, it's not the only part of it.
It's been a while since I've seen it, from what I remember, the last couple of discs is where they went to Cannes, danced in the street and behaved like asses, bitched about the dog from another studio etc. It's tough to learn much from what video, even tougher if you don't really know the process of selling a movie.
You are in the wrong business pal. Get out now before you dig a hole so big that you'll shoot yourself to end the pain. I think I understand you. I used to be like you. I like your passion, I really do, but for all the rice in China, please, please, please don't start up a production business. I am sure it will break your spirit.
A small story. A filmmaker was making a movie where the budget was 7 million dollars. He had just made another studio a movie that grossed $115mil (from a budget of $777k) and now he was over budget. It blew out to 11 million dollars and the studio called him in and demanded he give up his directing fee, this and that. They came to an arrangement. Even though he had already made the studio a lot of money, he wasn't beyond their meddling. He had to pay for the production of the sequel out of his own pocket so he could make it the way he wanted, without interference. Any idea who this filmmaker is?
Anyway, the morale of that story, if you have an investor, interference comes with the territory, unless you're a powerhouse superstar. And most of the time that isn't even the case. Take James Cameron and Titanic. He was a powerhouse by the time he was making Titanic and even he didn't have control over that production. It's a reality that you may need to learn to accept. Yes I know you're talking about independent filmmaking, and I've heard plenty of stories where movie budgets were so low that the studios didn't care enough about the movie to interfere. If you can get to that point, all the power to you. What are you going to do when your only investor insists that his mistress take the leading part in your movie or he pulls the funding? What if he wants to change the ending? Are you going to say no to his investment?
You know that you're right, the great artists make something for themselves. Something that they truly believe in. The problem is, you need to make something that everyone else also wants to see otherwise it won't ever sell. You say that you're frustrated that you cannot compete in the business world. It's no surprise, you're obviously not a business person. Don't take that a bad way, it's the same as saying I'm not a professional Tennis player.
The problem with movies is it's called Show Business for a reason. It's a business. It's the business of investing money in a movie with an expected, somewhat proven return. Don't get me wrong, there is nothing wrong with making movies for the sake of art. Nothing at all. Just don't expect any rational intelligent investor to invest. What you really want are donations. I'm sure there's another word for it in the art world.
I want you to try something for the next week. Look for investors to give you $100 for your business plan. Your business plan is this: Go to your nearest casino, put that $100 on the Roulette table on lucky 18 (you can change the number if you think another number is more your style). Tell them that you'll go halves with them on the profits gained from the venture. Let me know how you go and how many investors that give you money. [The odds for this investment is better than investing in a movie with an unknown, who has never completed a film, who doesn't know or like business, with no track record, with no names attached]. You'll see how hard it is to get the $100 investments. Imagine how hard it is to get hundreds of thousands of dollars, let alone millions.
This is going to sound really, really odd. If you want to get a small feel of investors (however removed from reality the investors on this show are) go rent out a season or two of a TV show called the Shark Tank. It'll open your eyes. You'll probably decide you don't want to be a part of that world. Who could blame you?
Would you invest your last $100 in someone who didn't know if/when/how they were going to give you your money back, let alone how much you were going to pay back? If not, why would you expect others to do the same, especially considering your distaste for business.
I could be wrong, you could be a savant, the next Spielberg, and everyone you're talking to could be missing out on the next billion dollar investment opportunity. I really do wish you all the best if you do choose to continue down this line.
Distribution is mostly about getting paid. Selling the movies. While marketing is a part of that process, it's not the only part of it.
It's been a while since I've seen it, from what I remember, the last couple of discs is where they went to Cannes, danced in the street and behaved like asses, bitched about the dog from another studio etc. It's tough to learn much from what video, even tougher if you don't really know the process of selling a movie.
Short Producing 101 on Gap loans: You make pre-sales and earn tax rebates in appropriate areas for making a movie, and a bank loans you the money, less their fee based on that. It's so you don't have to get investors to foot the entire bill. Producer's Business Handbook goes into it a lot more, I suggest you read. It's not an in depth book about film finance, but it'll give you a sufficient outline, enough to become dangerous.
You are in the wrong business pal. Get out now before you dig a hole so big that you'll shoot yourself to end the pain. I think I understand you. I used to be like you. I like your passion, I really do, but for all the rice in China, please, please, please don't start up a production business. I am sure it will break your spirit.
A small story. A filmmaker was making a movie where the budget was 7 million dollars. He had just made another studio a movie that grossed $115mil (from a budget of $777k) and now he was over budget. It blew out to 11 million dollars and the studio called him in and demanded he give up his directing fee, this and that. They came to an arrangement. Even though he had already made the studio a lot of money, he wasn't beyond their meddling. He had to pay for the production of the sequel out of his own pocket so he could make it the way he wanted, without interference. Any idea who this filmmaker is?
Anyway, the morale of that story, if you have an investor, interference comes with the territory, unless you're a powerhouse superstar. And most of the time that isn't even the case. Take James Cameron and Titanic. He was a powerhouse by the time he was making Titanic and even he didn't have control over that production. It's a reality that you may need to learn to accept. Yes I know you're talking about independent filmmaking, and I've heard plenty of stories where movie budgets were so low that the studios didn't care enough about the movie to interfere. If you can get to that point, all the power to you. What are you going to do when your only investor insists that his mistress take the leading part in your movie or he pulls the funding? What if he wants to change the ending? Are you going to say no to his investment?
You know that you're right, the great artists make something for themselves. Something that they truly believe in. The problem is, you need to make something that everyone else also wants to see otherwise it won't ever sell. You say that you're frustrated that you cannot compete in the business world. It's no surprise, you're obviously not a business person. Don't take that a bad way, it's the same as saying I'm not a professional Tennis player.
The problem with movies is it's called Show Business for a reason. It's a business. It's the business of investing money in a movie with an expected, somewhat proven return. Don't get me wrong, there is nothing wrong with making movies for the sake of art. Nothing at all. Just don't expect any rational intelligent investor to invest. What you really want are donations. I'm sure there's another word for it in the art world.
I want you to try something for the next week. Look for investors to give you $100 for your business plan. Your business plan is this: Go to your nearest casino, put that $100 on the Roulette table on lucky 18 (you can change the number if you think another number is more your style). Tell them that you'll go halves with them on the profits gained from the venture. Let me know how you go and how many investors that give you money. [The odds for this investment is better than investing in a movie with an unknown, who has never completed a film, who doesn't know or like business, with no track record, with no names attached]. You'll see how hard it is to get the $100 investments. Imagine how hard it is to get hundreds of thousands of dollars, let alone millions.
This is going to sound really, really odd. If you want to get a small feel of investors (however removed from reality the investors on this show are) go rent out a season or two of a TV show called the Shark Tank. It'll open your eyes. You'll probably decide you don't want to be a part of that world. Who could blame you?
Would you invest your last $100 in someone who didn't know if/when/how they were going to give you your money back, let alone how much you were going to pay back? If not, why would you expect others to do the same, especially considering your distaste for business.
I could be wrong, you could be a savant, the next Spielberg, and everyone you're talking to could be missing out on the next billion dollar investment opportunity. I really do wish you all the best if you do choose to continue down this line.
One of the big problems that I had with that small business development center is that I kept telling them when looking for help starting up a business was whatever decision of direction, I didn't want anything to interfere my art in anyway.
When bringing any product to market you, as a sensible business person, must understand potential customers have a choice among multiple competing products (ESPECIALLY in entertainment.) The SBA rep knows this.
Customers determine where they will choose to spend their money.
The customer's decision dictates what products will succeed and which will fail.
There's no need for anyone to "interfere".
If anything, it's ignorant business owners that "interfere" by bringing products to market that an insufficient number of customers are interested in to maintain the owner's business.
This meant by any means of people coming in to alter what I create or anything I create being altered just for business reasons for the work to be sold.
Who's money is being spent?
The person with the control over the purse strings controls how the money is spent.
If your creations are profitably marketable (consumers find value in them) as is then there's no reason to alter your creations for business reasons.
If your creations are not profitably marketable (consumers do not find value in them) then there is a legitimate reason to alter your creations for business reasons.
Do you have a few profitably marketable products currently?
Yes/No?
Pass/Fail?
And I always believed as an artist that art is meant to be the voice and expression of the artist and not just another meaningless product to be sold just for the sake of it.
Correct and agreed.
Art is art, and business is business.
Sometimes art can be business, but often it is not, not for lack of merit but for lack of intrinsic value to customers with an overwhelming overabundance of entertainment options.
You need to produce MEANINGFUL products. Products that are MEANINGFUL to customers, not to yourself.
You can even make art products you despise, but as long as customers are parting with cash for it then you're good!
It seems like art and business is so difficult to cooperate together.
They are.
Low barrier for entry + over abundance of supply = very thin profit margin.
FYI, just to be clear on proper business terminology:
REVENUE or INCOME
- EXPENSES
= PROFIT or EARNINGS
Too many people are generally unaware of the finer points of the distinct differences between revenue and earnings.
https://www.youtube.com/watch?v=ucMj_8eLN1A
The strange thing is I know exactly what I want to do.
Great!
Will a sufficient number of customers pay more for "what you want to do" than what it costs you to produce and market that "what you want to do?"
If "yes" - then pass.
If "no" - then fail.
I want to make movies, and webshows and even little merchandise like t-shirts and stuff to be sold on a website and sell the movies through indie friendly stores and rental stores, Amazon, etc.
Fantastic.
Looks great.
Do you have a history of bringing any movies, webshows and merch PROFITABLY to market so that you may repay the SBA loan?
But what seems to be difficult is finding start up money when I'm basically broke and don't get that much being unemployed.
Do you have marketable skills employers want?
Is your skill set a profitable product?
Being unemployed makes that a difficult position to argue.
Believing filmmaking is easier or more profitable than a lo/no skill minimum wage job is incorrect.
A barber with $300 of industry tools has more income potential than the overwhelming majority of independent filmmakers with $3,000 of industry tools.
Fact.
Harsh, but correct.
As well as finding the right people who understand exactly what I'm doing and what art is all about and how an artist can make an honest buck without doing something unethical to the artists' personal beliefs and the work itself.
Yes, that is difficult.
Too many artists believe because they have applied time and effort to achieve something that it has value.
And it does. It's just value only to the artist.
A marketable artist produces products consumers will value ABOVE the production costs of the art.
I remember that small business guy who yelled at me told me that no one is going to give me a loan unless if I proved to the banks that another company was going to buy the exact amount of my DVDs and everything which I found really weird because I told this guy that predicting something as simple as food to a grocery store would make more sense to that logic knowing exact amounts because everyone eats food and grocery stores sell it, that's that.
So, you were unable to provide evidence that consumers/distributors would be able to exchange cash for your film products to repay the SBA loan, right?
But film is different because it's in the matter of interest.
No, it is not different.
Yes, it is a matter of interest.
Film is entertainment.
It is not a Maslow's hierarchy of needs fundamental need of food, shelter, or comfort.
It is entertainment. And it competes not only with other films, long or short, narrative or educational, but also with live theater, music, sports, hobbies and general goofing off.
People have not only a finite number of minutes a day to allocate towards entertainment vs. income generation + socializing + family/personal duties/maintenance + medical maintenance + sleep but also a finite amount of income to allocate to all of these endeavors which compete among each other.
EVERYTHING is zero-sum, rob Peter to pay Paul.
Everything.
Some people like this kind of film, some don't so it's very difficult to say how much money is going to come out of all this.
Incorrect.
This actually has been quantified: http://www.the-numbers.com/market/Genres/
He gave me a hard time and just didn't want to see things from my point of view.
Incorrect.
He already did see this meeting from your POV because, I promise you, you are not the first person he's ever had this exact same conversation with about a hundred times every month for X numbers of years.
He sees it from your POV, he just has more marketing information resources available to him than you do.
That's all.
With more information you'd adopt a very similar POV, inescapably.
It's like this guy just didn't have any patience to understand what art means to an artist.
Probably an assumption.
However, it's irrelevant.
Your job, just like in pursuing filmmaking as a business rather than a hobby, is to make the customer BELIEEEEEVE that you were offering a product (your filmmaking+marketing skills) of greater value than the SBA's cash.
Just for shitzengiggles, how much of the SBA's money were you looking to borrow and repay with interest?
And really the only reason why I want to have an indie movie studio business in the first place is to make art and share it with like minded people, have a place outside my own apartment to work, have more space to video edit and most of the production (I mostly do animation but I want to get into motion capture and live action filmed in studio filming) and when it comes to money, if I make a great income that's good but as long as I have enough money to live on, that's really all that matters to me. Doing good work.
Looks good.
Revenue - Expenses = Profit.
Good work is bonus.
And to even hire like minded people to just go to work and have fun, have a good time making art that matters to all of us. Unfortunately it just doesn't seem simple enough in the eye of business which I don't understand why it just can't be in indie small business.
Business is Revenue - Expenses = Profit.
You must provide products of value to customers greater than the cost of producing+marketing them.
$10rev - $11exp = ($1)loss. This is an unsustainable business model without savings.
$10rev - $9exp = $1gain. This is a sustainable business model.
Simple as that.
Art.
Sport.
Medicine.
Education.
Banking.
Food.
Utilities.
Government.
Doesn't matter. It's all the same.
Sure I understand fully about the bills that need to be paid just to keep a roof over the head on everything. But just all these complications that go over my head regarding taxes, specific on every single penny to show all these people how you'll spend their money.
Sorry.
That's how accountability goes in the business world.
If you can't keep up with revenues and expenses (taxes are a business expense, BTW) then you lack the skill set to functionally operate a business.
You can get an unsecured loan on your general good word and name, but being unemployed that's going to be tough.
And even that unsecured revolving credit loan principal + interest will be expected to be payed back in fixed amounts over a fixed period.
Time = risk.
More time = increased risk of non-repayment.
I can understand in terms of I'm just this new person to them and they want to make sure I'm not going to be a fraud using someone elses money.
Correct.
As I stated earlier, they've had this same conversation a hundred times every month.
Every loan officer at your local SBA office has.
Every loan officer at every bank has.
At lunch or break room or staff meeting they share the more "remarkable" stories because the plain-Jane stories aren't even worth repeating.
There ain't nothing new under the sun to these guys.
You will remember the meeting longer than they will, I promise.
I can understand that logic and the security on that but when it comes to predicting how much money is going to come in every month before I start making anything and getting a bunch of useless anti-art suggestions.
Nah, they can make the same argument for everyone that comes in and wants an SBA loan for anything.
Doesn't have to be discriminatory against art.
Guy comes in and wants a loan for a small engine repair business has to provide evidence of potential income to repay the SBA loan before all other expenses, like payroll, lease, utilities, insurance, consumables, overhead, etc.
Girl comes in and wants a loan for a wallpaper hanging business has to provide evidence of potential income to repay the SBA loan and other expenses.
A couple comes in wanting a loan for a interior design biz, antique shop, logging company, tax preparation office, concrete pouring, barber shop, cake decorating, tailoring, etc.
Doesn't matter.
They all have to provide CREDIBLE evidence of the relevant current market saturation of existing competing products or services + income potential with the addition of your proposed businesses products or service.
Has nothing to do with art.
It begins to just tear my soul about as an artist.
Deal with it.
I remember this guy shouted at me saying that every suggestion he ever made to me, I always tried to figure out a way to go around it which I don't think is a bad thing, it's creative decision making.
No. It's evasive and rude.
You failed to market to him.
He was your customer.
You failed to provide to that customer a product (your business model) that he would "perceive" as having greater value than the cash he has been allocated by his superior and charged with protecting.
This is the same decision making process you make when deciding top buy WalMart's Great Value milk or Mayfair's milk.
WalMart provides you greater value. (Says so right in it's GreatValue name!)
Mayfair provides you with greater (supposed) quality. (That's what the yellow jug is supposed to do. Protect the milk from VitD decaying light.)
Will you provide that EXACT SAME marketing skill set to your filmmaking?
How will you convince 10,000 customers to part with $10 for a DVD of your $50k film?
How will you convince a distributor to pay you $55k for your $50k film?
The same way you convince the SBA loan officer to give you a $50k loan that you must repay back at 10% interest due to the KNOWN industry high risk.
Furthermore, filmmaking has high labor costs compared to materials costs.
Labor costs cannot be collateralized.
And what small relative materials required are often high premium cost products, meaning that once the end user has acquired them their remaining resale value has dropped precipitously to only intrinsic value (retail cost - premium cost = intrinsic value), meaning the SBA doesn't really have much hopes of securing your gear to resell to repay it's losses on it's loan to artsy-fartsy filmmakers.
It's like all strikes against me at that point. I've tried the pitching to Hollywood sort of route before making this decision.
LOL! Yeah, this is a tough biz. No argument.
It's not even personal tough.
The very nature of the low entry+high supply biz works against anyone being profitable.
I'm telling ya, being a barber with $300 in tools is more profitable than being a filmmaker with $3,000 in tools.
Hollywood is completely blocked off if you don't know any referrals for an agent or whatever, all these unions, no one wants unsolicited material.
Pretty much.
Lotta meet N greet. Lotta elbow grease and @ss kissing. Lotta "dues" to pay. Huge @ss learning curve. Tons of luck. And a sh!tload of skill goes a long way, too.
I have pitched to two tv networks which I felt were the best people who would respect my art and give me a bit of spotlight.
How many other people pitched their ideas that same quarter?
Across a year how many pitches do you think those execs listened too?
How many years x how many pitches do you think those guys have heard, pass/failed, watched 90% of passed projects self-destruct, brought a handful to market only to watch consumers balk at 90% of those immediately, and probably 2/3 fail having their next season re-upped after a single season.
Lotta consumer data for advertisers (the REAL customers of broadcasters) to pour over and review.
They turned it down because of lack of interest and also they thought my work was too high brow not made for the audience and it was going to alienate them and lose business and be a waste of time for the network.
AKA too expensive + not enough market to sustain advertiser income, which is what pays for your ticket.
I always kept my belief that an artist doesn't make something for the audience, they make something for themselves and share it with the world, and the fans will follow if they can relate or have interest in it.
Pfft. Yeah.
You gotta ditch ASAP that ingenue in candy land, Marvelous Misadventures of Flapjack view of "Art as Business".
http://www.cartoonnetwork.com/tv_shows/flapjack/video/candy-fish-clip.html
I basically wanted to escape everything that I felt would harm my artistic vision and wanted to just control the business myself, but it almost seems like the artist can't win in the business world which is quite disappointing in my opinion.
You can't win with that business model.
You can win if you compromise.
I wanted to just fundraise and get donations to help support my work but there's all these laws on taxes and It's so confusing.
You're unemployed.
You have the time to learn the laws and taxes so that you can pursue your filmmaking.
If it's non-profit, the easier it is to a certain amount, but if it's to start up a profit business, then it seems to be unacceptable.
"Easier" is a relative term.
The one answer I always get when asking people legal questions is "I don't know, you might want to hire an attorney to ask that one" And I tried, and I just can't afford it.
It costs attorneys money to operate their offices.
Their time and expertise has both a value and cost associated with it, just like yours.
UGH! It's really frustrating.
Yup.
I almost got charged just for setting an appointment to ask one question so I didn't bother right now.
Sensible.
As a consumer you determined the value of the attorney's services rendered was less than the value of other personal needs and desires.
Hope this was illuminating to you.
Hopefully it will be to others, as well.
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Troma has survived because they have the business people behind the
creative people. If you have the money to hire the business people then
that’s what you should do. Hire them to do all the legal and tax and money
side while you create art. If you don’t have the money to hire the business
people then you need to find the right people to team up with - they
provide the money and the business side, you provide the talent and
creative side.
That's exactly what I want to do! Thanks for the advice.
Everyone is right, maybe I am not a business person.
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I've said it before, and I'll say it again; I HATE the business side of running my business,
but that is the price that you have to pay to do something you love.