Are indie films profitable ?

Randall_Oelerich

Randall_Oelerich

Veteran
Are independent feature films profitable, and if so by how much? Or are most feature indie films more like art projects, produced hoping to break even, rarely making a profit? Okay I know about My Big Fat Greek Wedding, and Blair Witch, but those are exceptions. What is the rule, the norm, the average? Say I have a great screenplay, get it produced as an indie; what are the chances of it making a net profit of one million plus, based on historical results for indie productions?
 
For One Million Dollar Pay Off: Just on History, you probably have a 1 in a 5000 chance, which is better than the lottery. But having good prod quality, small named actors, a great script will up your chances dramatically.

For Under $100K Pay Off, your chances are more like 1 in 50, where genre and skill and accolades from festivals are the ways to up your chances.
 
Randall_Oelerich said:
Are independent feature films profitable, and if so by how much? Or are most feature indie films more like art projects, produced hoping to break even, rarely making a profit? Okay I know about My Big Fat Greek Wedding, and Blair Witch, but those are exceptions. What is the rule, the norm, the average? Say I have a great screenplay, get it produced as an indie; what are the chances of it making a net profit of one million plus, based on historical results for indie productions?
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Shoot it cheap, make it look as good as you know how and bust your butt selling it. Don't use distributors unless there's upfront cash in the deal or you just really want your stuff to be seen or get into the video stores. If you're in LA crash AFM. You have a chance there with a good genre flick.

-Nate
 
I'm with Nate on this one. I've shot a couple documentaries recently, one with a six figure budget, and one in the $10,000 range (in that order). If we were able to shoot the first one at the cost of the second one, I'd have made a good chunk of change, and that's all from self-distribution via the web and with wholesale distributors that feed retail outlets.

Shoot as cheaply as you can, and if you can't get a solid distribution deal, you can sell via the web. Getting $25/DVD vs $0.60 per Netflix rental seemed like a better idea to my producers, and it worked out quite well.
 
Don't you think the future is with downloadable movies? New bluray player has built in netflix download, with wifi tv now, and broadband, I wonder if people will just download movies direct to big home theatre tv instead of shelling out the gas to drive to BlockBuster.

Man it seems hard to make a sizeable profit with filmmaking.

pranic said:
Shoot as cheaply as you can, and if you can't get a solid distribution deal, you can sell via the web. Getting $25/DVD vs $0.60 per Netflix rental seemed like a better idea to my producers, and it worked out quite well.
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To me, if making a profit is your biggest worry when making a film, than I really can't feel that filmmaking is the best focus for you.
 
RallyMonkey said:
To me, if making a profit is your biggest worry when making a film, than I really can't feel that filmmaking is the best focus for you.
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I think the money issue is a reality. If the first movie you sink your fortunes into doesn't turn a profit, it seriously limits your opportunities for the future.

I think we're all interested in making more than 1 movie. Profitability has a lot to do with that.
 
As a filmmaker, I am genuinely interested in making a film that tells a good story and is engaging for my audience. However, money becomes a reality if you have investors.

I'm not making independent film for the money, but if I can make some along the way, that probably means I've done a good job of getting my work out to an audience.

I've partnered with a very business-savvy person who was able to raise capital, push towards faster deadlines, and ultimately get a PR/marketing push for our documentary. These are the things I wasn't good at a few years ago, but have taken an interest in learning first-hand.

There'll definitely be no second film if you waste the money of your investors. I shoot for fun all the time, but when there's other people's money, that's when it's time to get serious.

When I made the comment earlier about choosing to sell DVDs from our web site, rather than choosing to distribute through Netflix for $0.60/rental, it was solely based on the best approach for paying the investors back, and reaching a sizeable audience.

I shoot shorts and little things with friends, but if there is investor money involved, then I take things pretty seriously.
 
NinjaVsPenguin said:
I think the money issue is a reality. If the first movie you sink your fortunes into doesn't turn a profit, it seriously limits your opportunities for the future.

I think we're all interested in making more than 1 movie. Profitability has a lot to do with that.
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I agree with that, for sure, but it's more than just that. Some of us did come to Hollywood to make lots of money. I'm not saying it's likely, but it's much more likely than many other industries. People say, "Oh the dream of fame and fortune, that's not why you should be making movies." I agree, that isn't why you should be making movies, you should have a passion for it. BUT if you want to make millions, what else are you going to do? You're going to be an accountant? Ok... A doctor? Sure... I guess, over a long enough period of time, maybe you make a nice $250,000 a year, still not much money. An engineer? No, they never make over $150,000, even if they're amazing. You have to be a businessman, and film is a business.

I wouldn't want to make any feature film if I couldn't make a profit on it. If the odds are really that bad of ME making a profit on a feature (not in general, but the quality I know I could bring to a feature at the time), then I won't do one. It's better to create a production company that does lots of corporate and commercial work and grow from there, because if that's where the money is, that's where you go. Then you can make a feature on the side as a hobby or something but if it's just a hobby you can't really make a living at it. I didn't come down here to have another hobby! I came down here to make a living at filmmaking, one way or another, whether that's training videos, corporate work, commercials, music videos, features, Web videos, etc.
 
JonathanLB said:
I came down here to make a living at filmmaking, one way or another, whether that's training videos, corporate work, commercials, music videos, features, Web videos, etc.
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I love your attitude. That's how you make it in this world, whether it be filmmaking or something else. Doing what you love.
 
lol, well thanks. It's definitely not easy to make a living doing what you love, though, I guess that's why it's such a dream for so many people. It's kind of funny because I am in a financial position to pursue my goals without worrying about going bankrupt or being out on the streets, yet I find that I'm scrappier than some people I know who are in much more desperate shape. I mean, I talk to a lot of people who are like, "Well I came to Hollywood to do feature films, I don't want to do any other work, I don't do corporate work, commercials are stupid," etc. I've also had a lot of friends say, "Do you really want to do corporate work....? Didn't you go to Hollywood to make features?" It's such a funny question. Obviously everyone comes down here hoping to make features and be the next Spielberg or whatever, but that doesn't mean you don't do other stuff. If it involves the moving image, I'm interested in doing it, unless it's porn or weddings. Those two are not really on my radar. But if it's a product ad for your Website, or a training video, I can think of ways to make all of that work fun and fulfilling, it doesn't bother me at all. You just have to take your work seriously and see how you can bring your A game to anything no matter what it is. I thought the last training video I did might be boring, and was nervous about it because I had never done a training video before, but I injected quite a bit of humor and entertainment value into the script, really made it a lot less boring, and we all had a blast making it. I've seen the finished product probably about 15 times now, I mean more-or-less finished, while color correcting it, making tiny changes, reviewing it, etc. I still laugh at a few parts. It ended up being fun despite just being a food service training video, so if even that is fun, I figure there's not much work I wouldn't enjoy.

At the same time I feel at a crossroads because my father applies some pressure to make money more immediately, do the corporate work and commercial work (which I've done none of so far, to be honest, just corporate / industrial work), and pursue my passion of features and music videos on the side. He doesn't much understand the idea of building a reel and submitting to film festivals, I think to him it sounds like a lot of BS, haha. I've pretty much given up on music videos because while I know I can do great work and I really enjoy them, there is obviously not much money there. It would seem to me that quite literally there could only be about ten filmmakers in the world making a good living doing music videos. The rest either barely scrape by or they only do a few videos a year and mainly make money on other types of work, while doing music videos for fun. So, I guess that's something to aspire to, just doing a music video here or there, maybe someone thinks my talents are worth a few bucks and I mostly do it just for fun. I'm ok with that.

And now look at all of these depressing articles about indie features. Part of me is very stubborn and I pull the Han Solo, "Never tell me the odds!" Because honestly, if we all just quit anything where the odds were stacked against us, we might as well just all sweep floors, basically. The odds of being a pro athlete are terrible, odds of being in a signed band, terrible, odds of being an actor making a living at it, awful, director or writer doing features, really bad. But what does that mean? Are you going to just not do it because the odds suck? I mean statistically someone has to make indie features, because there is a market, and someone is going to make money at it. If you don't try at all, you will fail for sure. If you try, you still will probably fail but you gave yourself a chance. I'm just not sure what the alternative is, to wait until someone hands you a $5 million budget because you're such a nice guy and says, Hey, direct this feature, here's the budget! I don't see that happening. The world won't give you anything, you have to take it if you want it. Sort of like the great line, "Fortune favors the bold!"

Where I would prefer to be is doing corporate work for six months of the year, making good money because I run a production company with so much money in tools, so I'd like to get paid fairly for my efforts, then I could spend the other six months of the year on my own work, whether that's doing some low budget music videos for fun, or doing a feature film with some of my earnings and sending it out there. That would be nice security to know that if I lose all of the money, oh well, I'll just make it back in the corporate world. And if I make a profit, awesome, that can go into the next feature or be invested in new equipment or something.

I don't know, it's a tough industry for those of us at the bottom. It's especially tough when you realize that no matter how good your work is, even if your last corporate client was thrilled and has gotten raves about your great work, none of that really matters because you're only as good as your ability to find the next client.
 
Hi all,

Nice posts, gang - I agree with your insights. Aside from the marketing and distribution side of the business, I've found that most Indie directors have awesome director commentaries on their DVDs. It seems we all love to give back to our colleagues. Assuming this doesn't hijack this thread, some of you may wish to list your favorite Indie director commentaries. Mine include:

El Mariachi and Desperado - Robert Rodriguez (awesome cost saving ideas)
Robot Stories - Greg Pak (four different commentaries in one!)
Broken - Alex Ferrari (3 hours of special director feature stories/commentary)
Quiet City - Aaron Katz (amazing off-the-cuff improv with rookie actors)

Of course, I'm sure we all have our favorite director commentaries in the big leagues - I love Ronald D. Moore (Battlestar Galactica), Elvis Mitchell's "The Treatment" podcasts on KCRW, Terry Gross "Fresh Air", and dozens of high-end director commentaries. But aside from the inspirational/creativity aspects, I find I learn far more practical info from the Indie directors.

Thoughts?

Michael
 
jls4 said:
For One Million Dollar Pay Off: Just on History, you probably have a 1 in a 5000 chance, which is better than the lottery. But having good prod quality, small named actors, a great script will up your chances dramatically.

For Under $100K Pay Off, your chances are more like 1 in 50, where genre and skill and accolades from festivals are the ways to up your chances.
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kwoff said:
Where do these numbers come from?
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Without trying to justify the numbers you question, they track closely with Indies under $10M at the Sundance and Cannes.

http://www.indiewire.com/biz/2008/06/irst_person_fil.html

Regards,

Michael
 
JonathanLB said:
It's kind of funny because I am in a financial position to pursue my goals without worrying about going bankrupt or being out on the streets, yet I find that I'm scrappier than some people I know who are in much more desperate shape.
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I've found that scrappiness has little relation to your financial well being. It's a passion for a dream and you want to get it done, no matter what. You look at someone like Randy Pausch. Guy is SOOO scrappy. Until his dying day, he kept pushing it, never giving up.

JonathanLB said:
If it involves the moving image, I'm interested in doing it, unless it's porn or weddings. Those two are not really on my radar.
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I told myself the same thing. I don't mind being a corporate tool, I will NOT do porn or weddings. The only time I'll do a wedding is for a friend and that's if they beg me.

I've done other videos for my friends, like this one: http://www.youtube.com/watch?v=0EGBu_fuaOg

It's a short film about how they got together. Originally, they were going to be in it, but got camera shy. But I did it because I thought it was a great story and could really bless their wedding and their friends.

I'm in talks with some other friends to do something similar. But this time, they're going to be in it.

JonathanLB said:
do the corporate work and commercial work (which I've done none of so far, to be honest, just corporate / industrial work), and pursue my passion of features and music videos on the side.
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Commercial work will eventually lead to commercials. And there are plenty of great directors who started doing commercials, so I don't think that's a terrible route.

Music videos are also easy and cheap to do. Find a small indie band and offer your services. You get the experience and exposure and start building contacts in that industry.

JonathanLB said:
If you don't try at all, you will fail for sure... The world won't give you anything, you have to take it if you want it. Sort of like the great line, "Fortune favors the bold!"
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Totally agree.

JonathanLB said:
It's especially tough when you realize that no matter how good your work is, even if your last corporate client was thrilled and has gotten raves about your great work, none of that really matters because you're only as good as your ability to find the next client.
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Those rave reviews can be leveraged into selling your next client your services. Get a short video of them saying how good you guys are and use that as a reference. Just like the rest of the industry, people like betting on a known commodity.

Eventually I'll sell my services, but I want to be confident that I'll be able to deliver. Right now, I'm still learning and I'm focusing on the things that I can improve, honing my craft. Writing, directing, editing. And the best way to learn is to just do it.
 
I have been making shorts for about a year now and I have not seen profit on ANY of them. Like zero dollars. Infact i lost money on them because i put in money without getting anything in return.

Each one cost between $0 and $700 (one was 3,000 but I was an associate producer.. so i put down $36 and did every bit of little nitty gritty work that was availible such as breakdowns... help helped the producer with everything).

That being said, if you love filmmaking for the sake of filmmaking, do a couple shorts. Once you get that under your belt and the stresful experience out of your way, you'll have a better chance of getting investors. If you have a good feature length script, take a scene from that and make it a 10 minute peice. That's a very good way to get investors interested if you say "I made this for 1,000 dollars... and it's good... Imagine what i can do with 1 mil!"
 
Are indie films profitable? They can be.

It depends on how much you spend and how much you make, or rather how much you put aside :-) but that's another thing.

An indie feature can be done for a few hundred dollars to $25,000,000. Beyond that it's not an indie feature, because I don't know anybody who put up his own money in a movie that cost more than that.

To me a movie that cost $200,000,000 made by an indie filmmaker who got a studio to finance it, is not an indie movie.

How much you spend on an indie movie should be related to how much you think you can make back. So you have to research it. I prefer to check with distribution, and even get a distribution contract of some kind, or just a simple agreement with a distributor you know or trust.

Then you can make a profit with an indie movie. You can make more profit because you're not risking millions of dollars. As an indie filmmaker you don't have unlimited marketing funds. You have no financial system to back you, you have no shareholders and stock market brokers raising money for you.

I agree with Jon and the rest of you guys who love to make movies, you have to do with you have to do to make a movie profitable. LOL
 
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