We need your comments on the Proposed Indie Film Fund

I dont get it..... you want 5000 people to donate $1000, and 20 of those get back $210000 each to make their film? and as well as making.... $800,000.... your idea would also want a profit share? and controlling interest in the film.... maybe I had one too many beers....

Sounds like either a lottery (a scheme - usually state based - to milk money from filmmakers) or an opportunity for self paid corruption. Let me explain from your example:

You get 5000 filmmakers each contributing $1k each. This equals $5mil. From those 20 are chosen and get a budget of $210k each, adding up to $4.2mil (at the capped level so in reality it is going to be less). Add in crowd funding, tax credits, product placements there's a larger deficit than before.

To sum it up, you want filmmakers to put all the money into the fund and pay an administration fee, let the fund profit from those efforts through crowd funding, tax credits and product placements and on top of that, you only want the filmmaker to have a minority share in his/her own movie.

Most funds are designed to pump money into the filming industry, not take it out. In the way that you described it, this is not a film fund.

A controlling interest?

The copyright owner of the script owns the intellectual property.

What if the filmmaker has an LLC, limited liability company?

Who is going to review these business plan submissions?

BPs and executive summaries are necessary for venture capitalists and business loans with the government.

What if the film flops?

VCs like to fund packages of films in the event some fail.

Yeah if I'm reading correctly I don't really like it. That means I'm gambling a $1000 against other professionals that my screenplay is better up against theirs...

I'll pass.

I really don't see the appeal. $1000 a year is a lot for very little possibility of return - the odds aren't as good as a lottery because there is a selection process. And If you don't get funded for five years you end up in a 'preferred category' - but how does that make sense? If your film concepts haven't been good enough to win out on their own, why would they suddenly become better because you've diligently paid in? And if less-compelling ideas are getting funded because the filmmakers have paid in for more years, how does that benefit the other people who are getting 'equity' in these films? Wouldn't they prefer that the absolute best films get made each year?

Then there's the amount of promotion & marketing it's going to take to reach 5000 people who are willing to cough up $1000 - which you need to do before you get the money, so I assume you're planning to pay for that out of pocket? It's hard enough to crowdfund a few hundred people to chip in $50 each - I can't imagine what it'll take to hit the numbers you're talking about. I just don't think it's realistic...

And then on top of the funding you're providing you also want to run crowdfunding campaigns for each project? I don't see that being successful, it's one thing to ask people to chip in to fund an indie filmmaker who has no budget, it's another to ask someone to help a project that already has $200k+ of budget... those will have to be relatively large campaigns to contribute significantly to a project with that large a base budget. If you aren't funding projects that already have a significant fan following it's not likely the individual crowdfunding campaigns will be particularly successful.

At minimum I think you'd need to change the concept so that anyone could invest, not just filmmakers - some people (probably most) would only be equity owners. That opens up your pool of potential investors, while also reducing competition among the investors to get their projects funded. In fact it probably would simply be better to solicit investors for the fund, then solicit filmmakers separately to apply for funding from the fund - that way you don't limit your potential pool of project ideas to people who can afford to contribute $1000.

I really don't see the appeal. $1000 a year is a lot for very little possibility of return - the odds aren't as good as a lottery because there is a selection process. And If you don't get funded for five years you end up in a 'preferred category' - but how does that make sense? If you're film concepts haven't been good enough to win out on their own, why would they suddenly become better because you've diligently paid in?

Click to expand...

Wouldn't that also mean that the majority of people would become preferred since there is only a 1 in however number of people who don't or are we assuming that people are semi-intelligent and would wise up within a few years and drop out?

It just occurred to me that as an investment vehicle this will fall under SEC regulation, which will complicate things and add expense to the setup and management. Even treating it as a crowdfunded investment under the new JOBS act rules will be complicated, and I believe it caps the annual equity for investment at $1 million, which is problematic for your 5000 x $1000 scenario.

Who knows, someone might even consider it a pyramid scam.

Sounds like the beginning of a good documentary.



Next comment: http://t2.gstatic.com/images?q=tbn:ANd9GcRMfmBCoGqatgbQfRV_uolaNH_G-fxaPK4_K3HIpy0TJPjUAqLNqg