raising cash

HerzogisGod

HerzogisGod

Well-known member
Im in the middle of production and have pretty much run out of cash. I have invested $20,000 of my own but can no longer float this ship alone. I need to raise another 30k.


im putting together a proposal to take to investors. It will include scenes from the film, a trailer, a list of all those dedicating themselves for free on this project (including a fairly well known actor) my script, plus a short pitch.

What kind of paperwork is involved? what do I need potential investors to sign so as to cover myself and make it clear that the money is an investment.

Are there stock forms i can use?
 
Jouch. Answers to this depend on oh so many things. First thoughts -

1. What country/state/province/ward/city etc are you in? Laws differ greatly.

2. Have you formed a seperate production company FOR THIS FILM.

3. How far afield do you anticipate having to go? Great aunt Matilda will probably be far more lax than someone you don't know. Institutional investors/private equity "clubs" will have their own requirements (measured in kilos of flesh).

4. You really, really, really want a lawyer involved at this point. He who draws the initial agreement has the high ground in negotiations as to how much of your creation you might get to keep.

5. Your legal costs will be WAY less if you do your homework first. There's lots of books out there on structuring the deal. And you just wanted to make a movie . . . .

You might find this helpful . . .http://marklitwak.com/
 
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This may sound dumb but why did you run out of cash in the middle of the production?? Your budgeting skills will be suspect when looked upon by future investors.

I can understand running out of money at the end - nearly all movies do that, but the middle??????
 
ditto. And because you missed my so much, I'd leave that way on the downlow if entertaining an investor.
You may as well skip that at this point and just finish it up without owing anyone.
In the time it'd take to score a 30k sponsorship, you could just bill it out.
 
I didnt "run out". I never had an official budget. I was using my own cash for funding. Things get expensive, though. Dont wanna dip into my personal account anymore :)
I have filmed enough to put together an interesting sample of the film

Im gonna do whatever it takes. Laywer, set up production company..whatever it takes
 
Before you leap into anything, you should always have enough money to finish and more. Otherwise you shouldn't be doing it. The risk is just too high. If you anticipate something costing $100,000, you should have $175,000 on hand just in case, because better that than running out and losing it all from an unfinished project.
 
If it were me, I don't think I'd tell potential investors about people working for free. I'd let them think everyone was getting paid out of the budget. That way maybe they'll be more amazed at what you've accomplished for so little money, and be more willing to risk some of their own.

That's just me, though. What do others think?
 
Yeah, if you work with a lawyer and accountant, you can have the crew payroll accounted for by "paying" them with ownership. The budget, on paper, gets a lot bigger, and they get points as investors.
 
chapelgrovefilms said:
If it were me, I don't think I'd tell potential investors about people working for free. I'd let them think everyone was getting paid out of the budget. That way maybe they'll be more amazed at what you've accomplished for so little money, and be more willing to risk some of their own.

That's just me, though. What do others think?
Click to expand...

Actually as I was reading the thread that was the first thing to jump out at me. Experienced investors will run away from productions with crew working for free. It sets off alarm bells in their head and screams amateur production. It is the same psychology that has people scuff at a painting selling for $30 but will buy that same painting selling for $1000. I think it also has a little bit to do with the "The Producers" factor of them worrying they are throwing money into a project that will not return a serious end product.

It is wholy different if you have a DP, director, editor, actor, etc who has a high profile resume, who agrees to work for free or well below day rate. You would want to highlight that individual as evidence that experienced people believe in this project and you. But if it is your whole crew is working for free, that will bite you in the ass.

I guess there might be some investors who are not alarmed by everyone working for free but I think they are the exception not the rule.

Cheers
 
On the matter of your seed money, you need to be certain to play it as part of a larger (and thorough) business plan / budget for the project. I wouldn't address where and how the up-front money came from at all. You are a partner in the eventual financing, because you put together a development / marketing package in-house, rather than packaging / pitching the concept solely on paper.

Let them know that you went into it planning only to develop what they see in your glossy marketing piece. This was bought on speculative money (and the implied risk) that you didn't want to expose your investors to.

What is in the can is in the can. If it is to par with what you will accomplish with the rest of the money. This new budget needs to be based on industry-standard breakdowns and line-production techniques. You cannot go into a presentation not knowing how much you'll need. The top page of your budget will do, you don't need to provide the details, but they need to be there.

You should build in contingencies and a completion bond - even if the bond isn't secured through a typical guarantee firm.

Plan to answer tough questions. Do you have a line producer? Do you have distribution or a plan for distribution? What attachments do you have? What is your experience? If none, your marketing piece will get you somewhere, but might not seal the deal in a room of strangers.

Treat this like a business and your proposal as a business plan and you'll go a lot farther and not be embarrassed when the difficult questions come at you.

e
 
so today I started a business account through my bank. Chris Deleo Films. Now I have an official place for all the investor cash I'll be receiving :)

Next I wanna see a lawyer about drawing up a contract for potential investors.

How should I set up potential profits ie. X amount of points for X amount of dollars invested
 
Most of the time, points do nothing. Since almost all films never make a dime. You want to hire someone to breakdown your script and budget it out. Show the investor you are on top of your game.

If you get a question, how long will you be shooting for? And you answer, "you know, on weekends, should be done soon once we get the money" is a flag to pull out and save their time.

A "The production will take exactly one week and 4 days with 12 hour days. To be shot consecutively...we have the entire film scheduled to fit within the specific timeline" is much more of a professional answer.

Also, consider name actors, if you have no one attached, it will be harder. If you walk in and say "It most likely will cost 50,000 dollars to get the film shot...maybe..." is something else people will be wary of.

Basically, people want to know where their money is going. Exactly where it is going.
 
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