In partnership with

Receive Honest News Today

Join over 4 million Americans who start their day with 1440 – your daily digest for unbiased, fact-centric news. From politics to sports, we cover it all by analyzing over 100 sources. Our concise, 5-minute read lands in your inbox each morning at no cost. Experience news without the noise; let 1440 help you make up your own mind. Sign up now and invite your friends and family to be part of the informed.

Sign up today!

Investors usually fall into one of two groups

I spend a lot of time talking about where to find money for your indie film. Today we're going to dive into who you're actually pitching to. Not all film investors are the same, and you can’t pitch them the same way. There is a little similarities for sure though.

Let me break this down into two distinct categories. Yes, there's nuance (there always is), but understanding these two types will help you craft the right pitch for the right person.

The glamour lottery ticket investor

This is your High Net Worth (HNW) individual. Think successful doctors who've always dreamed of being part of the film industry. Real estate investors looking for an exciting side venture. Business owners who want something interesting to talk about at dinner parties.

These investors aren't looking at your film as a carefully calculated investment opportunity. They're buying into something else entirely: the DREAM of being part of Hollywood.

When you pitch to these investors, you're selling an experience. They want their name in the credits, so they can take a picture of the big screen with their name on it and show it to their friends. They want VIP access to set visits that make them feel like an insider. They want invitations to the premiere where they can bring friends and family. They want the chance to say "I helped make that movie" when it comes out.

Don't get me wrong. You still need all your paperwork in order. Your investment deck, your business plan, your legal documents must be professional and thorough. But that's not what's going to seal the deal, it’s just part of the deal. These investors are buying a lottery ticket with some glamorous perks attached.

They know it's high risk. They know they might not make their money back. But if the film hits? They could hit the jackpot AND have an amazing story to tell.

You'll typically be looking at minimum investments of $10,000 from these folks, though it can go much higher. The key is that you'll probably need several of them to fund your film. The fact that they are investing just a portion is what makes it more like a lottery ticket. $10,000 investment on a $2,000,000 film is not that large of a sum. Also, in reality, it’s not really a smart “investment” either. The reason I use that word in quotations is that, yes it is an investment, but as a type of investment, if the film is middle of the road successful, the returns weren’t that good compared to other investments.

Let’s just say the film makes its budget back plus the premium plus some profit.

For example the investor makes their $10,000 and then they make the premium, and you had it on the higher end of 30%, so $3,000, and then even after that the film made a little more profit and they made another 10%, so $1,000. So their initial $10K gave them $4k, but that $4K return could have been over the course of two years.

This is why it’s a lottery ticket in that way. They have a small level of investment and if it hits they get a small return back. Not such an exciting sell.

BUT, on the glamour side, the emotion side, its a huge sell. Like mentioned above, these are people that have never been anywhere near the movie industry, and you are selling them on the excitement of that. It doesn’t have to be Hollywood. Even if it’s in some city in Kentucky. You’ll still film the movie there, and they can visit set, and then have a premiere there, which they can attend, and finally it will be released more widely and they can show that off to their friends and family. That’s the glamour.

Now, no matter what, have all of your financial and legal work in order, because even though the sell is emotional, everything on the business side still needs to be proper.

The institutional investor

Now we're in completely different territory. These are your capital funds, your film financing companies, your serious entertainment investment groups. They don't care about set visits or premiere tickets. You may be wondering why, well sure they may visit, but they are financing maybe $100M or more a year into films, over a whole slate of films to diversify their investments. Even though you are selling them on ONE film, they are looking at how that film falls into their whole portfolio for the year.

When you walk into that room (or Zoom call), you better have your numbers ready. They want detailed financial projections. They want clear recoupment strategies. They want comparable film performance data. They want market trend analysis. They want distribution pathways. They want tax incentive breakdowns. They want pre-sale potential.

Your pitch needs to focus less on amazing creative vision and more on the path to profitability. These investors look at your film as an alternative asset class, pure and simple. The pitch deck and script, is the last thing they look at, they are looking at the investor pitch or overview and then all the additional supplied material with that.

They'll often write bigger checks, but they'll do their due diligence. Every number in your business plan will be scrutinized. Every assumption in your financial model will be questioned. They're not taking your word for it. They want proof.

It has to make financial sense to them. So you need to make sure the project makes financial sense. You need to make sure the budget aligns with the script and the cast attached.

You can’t have a $5M film with actors no one has ever heard of. That doesn’t make financial sense. Then the question is, why is this budget so “high” if the cast ATL isn’t going to be over $500K total.

The budget and film then need to match market values. What films of that level are selling right now and for how much.

The number of times I have seen Paranormal Activity or The Blair Witch Project used as examples for someones film is mind blowing. Unless your financial package matches WHY those films succeed (hint, it’s the marketing).

If you build a house and sell it, BUT want an investor to pay for the costs, how much will you sell it for. That answer comes down to the quality of the house and the location of the house. That’s production and distribution. Those things need to align to not only match the budget but to show a potential huge profit.

The pitch difference

Many filmmakers mess up because they use the same pitch for both types of investors. They try to dazzle institutional investors with creative elements, or they bore HNW individuals with detailed financial models.

For your glamour lottery ticket investor, lead with the emotional hook. Show them the excitement of being part of the film industry. Include the business case, but know that's not what's going to close the deal.

For your institutional investor, lead with the numbers. Show them the business case first. Include the creative elements, but know they're making their decision based on financial viability.

Remember this: Glamour Lottery Ticket investors buy into the excitement of filmmaking. Institutional investors buy into a business case. Know your audience, adjust your pitch accordingly, and you'll have a much better chance of getting that "yes."

You can use both types of investors for the same film. Just make sure you've got your legal structure set up properly to handle different types of investments and do this through an attorney.

You often need a lot of HNW investors to finance your film but you may only need one institutional investor. The difference is though, the HNW won’t have as many requirements like MG’s, pre-sales, tax credit certificate, pay or play deals signed, et cetera. Figure out what you are able to accomplish and then go after the right group. Or find the right producer to help you…even if you are a producer, it’s okay to bring on another one, it’s quite common.