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A journey to investors

I took a hiatus from producing for a couple of years. For about four years I was working as a Production Manager on indie films in the $2million to $5million range. After that I worked for a film financing company for a couple years. After a while I had an itch to get back into producing, but decided just to focus on the development end. What that means, is that I didn’t want to over see the full production like a “physical” producer or supervising producer. I just wanted to find strong projects I could help package and get in front of studios, financiers, and distributors. Luckily around the same time I came across a producer who had just left his executive position at a streaming platform who also wanted to get back into producing.

Our first order of business was to find strong projects and broaden our network. Him and I have a really good network, but to drive these projects forward, we needed an even stronger investor network. Most of you may think that we would find an investor to pitch our different projects too. A better strategy is to create business relationships so that you can pitch later on. It’s better to dive into the overall wants and needs of the investor than to pitch a single project and the only thing you really learn is if they want to move forward or not.

Learn from investors

I have projects to pitch, but I learn nothing from pitching. It’s far more valuable to have a conversation and discussion to learn.

I’m going to share what I’ve learned. This is only from a small handful of people, but that small handful each run their own funds that have collectively already invested hundreds of millions of dollars into film and tv series.

“I don’t read the script”

This is a common statement. Each of the CEO’s I talked too are people who love movies which is why they have their funds invest in movies. However, they don’t want to be emotionally biased by the screenplay. Also, sometimes, they have someone else at the company do coverage.

It may seem strange that the investor wouldn’t read the screenplay, but think about it like this, it’s a producers job to ensure that the screenplay they are bringing to financiers is the best possible screenplay it can be. That responsibility needs to and should fall on the producer and screenwriter - that they are ensuring when they go out to ask for money to make a movie, they are offering up the best possible version of that story and screenplay.

The financiers then trust that what you are presenting them is the best possible version of the craft & art, so the investor can deliver on the financing(business) for you to accomplish the logistics of bringing art to commerce.

Here’s a decent comparison, if you’re a chef and you want to open a small little local restaurant and ask an investor/bank for money - they ask to see the financial structure. They don’t ask to see your menu and sit down and taste all your meals to determine if you deserve to be financed for your restaurant.

Keep that in mind. That’s why the package is what matters most, not the screenplay.

Think like an investor

This happens way more than it should, but many filmmakers are jumping to get investors because they need to make their film. That’s what the filmmaker wants. Are they thinking about what the investor wants? Usually not, or if they do it looks something like this.

They have a horror film and they compare their film to Get Out, Paranormal Activity, The Blair Witch Project. Films that were made on low budgets that made enormous amounts of money. Those are lottery winning films. Like my friend and colleague Stephen Follows likes to say, “you are presenting a lottery ticket to your investor”. If you are doing that, then you want to sell them on the excitement of making a movie and now of making money…but hopefully this could be the lottery ticket but it is very likely it is NOT.

Now, if you are going after investors that have invested in films or investors that run funds or capital that invests in films, then you need a whole different approach, and this is when you need to ask yourself “What does the investor want?”, you can only understand that, by thinking like an investor.

They want to put their money behind a film that has the least amount of financial risk and the most likely it will recoup it’s money and make a profit. They aren’t looking for the next GIANT surprise hit (even though of course everyone wants that). They want to know that if they invest they could make 150% back within 18 month. That is a WIN. Don’t think in terms of making 1,000% back.

The package

So you need to package your film that makes sense for the budget and that could make some profit.

I won’t dive into ALL the different things that investors want to see, we’ll just focus on the budget and what should be attached to that.

This is another thing I see a lot, there is a script, there is a pitch deck, and then there is some number in the pitch of what the movie will cost, say $4million. But, there is not total budget by an experienced line producer in the state or country(if not in the US) in which you will be filming. That is the bare minimum you need after you have a script and pitch deck. There is NOTHING you can do without a full detailed or total budget. Every single decision that is made from this point onward is based on that budget.

The budget needs to make sense for the size of the film and the level of the cast. That’s the other thing, if you haven’t even started having conversations with agents or even a casting director, how are you putting together those ATL numbers to determine the ATL budget? You can’t just say for your $4M film, you have $900K budgeted for cast if you haven’t even begun the process. This is why your LP should also have experience in those same budget levels and with the same level of cast as your film, so that you can get the most accurate budget.

Depending on your distribution goals, the marketing in the budget also needs to make sense.

The budget is the first item the investors will look at. They have seen hundreds if not thousands of budgets. So they know what they are looking at and they will know if what you are presenting to them is just fluff or an incredibly well designed and detailed budget.

That’s what thinking like an investor is, how will the money be spent in the most efficient way that makes the most financial sense to see the best return.

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