You have a story that you can’t wait to share. There is only one thing stopping you from starting production after spending hours revising the script and assembling a team: you don’t have the necessary funding. So your producer suggests using crowdfunding to raise money for the movie, but how do you get started?
Nowadays, crowdfunding is a popular way for movie projects to get off the ground. However, there are a few things you should know before starting a crowdfunding campaign. Actually, that last statement is overstating the case; there are many factors you should consider before committing; you should do your research to avoid having unrealistic expectations and wasting time.
To get things started, take into account the following:
Is crowdsourcing the best option for your project?
Crowdfunding consumes a lot of time and effort and serves the purpose of generating interest in your project and translating that interest into a series of modest cash contributions that are made in exchange. Before putting all of your eggs in the crowdfunding basket, see if your country offers government financing options for short films.
The actual expenses involved in making a short movie are quite high. It can add up if you take into account the costs of renting equipment, paying actors’ and crew members’ salaries, organizing logistics, and paying for post-production. I’m not talking about spending money on a trip to Fiji, but rather spending money on a new Mercedes.
Take advantage of any government funding you may have. Consider what you can get for free before deciding on the final budget if you don’t or happen to live in a nation like the United States. You will need to raise a lot of interest and support for your movie in order to use crowdfunding, but frequently, individuals and organizations are willing to make “in kind” donations, which can drastically reduce the cost of your entire production.
Eliminating the Herd
Because you are using a crowd of people to fund your project, it is called crowdfunding for a reason. Therefore, identifying your target audience is one of the most crucial things you must do before launching your campaign. Along with knowing who your audience is, you also need to know what your movie is about and how much the target audience will care about the story.
There are three different types of investors for your movie:
- Those in your immediate circle who genuinely care about you and want to see you succeed are your friends and family.
- Fans or Communities – You may have fans or communities of people who are interested in your film or the genre it belongs to but who do not personally know you. They want to see your movie.
- Angel investors are kindhearted individuals who, for whatever reason, want to invest in your project because they see potential.
Establishing the Media
You should start considering the media needed to promote your project during your crowdsourcing campaign once you have determined who your target audience is and how much funding your project needs to get off the ground.
- Trailer
- Photoshoot
- A necessity to update
- Make it your own
- Examining the small print
There are many ways to contribute, but keep in mind that crowdfunding platforms charge commissions for their services. If you have a non-US bank account, Indiegogo charges 5% plus a $25 wire transfer fee to transfer money. If your project is successful, Kickstarter also charges a 5% fee, and additional fees of 3%–5% may apply depending on the payment service, such as PayPal. This can total up to about 10% of your campaign in total costs. In order to have enough money to complete your film after fundraising costs, be sure to add an additional 10% contingency.
The True Cost of Benefits
Your campaign cannot be successful without “perks,” or the rewards that your supporters receive for their financial support. Additionally, you need to confirm that you can deliver your benefits and that they are realistic.
Although DVD copies are excellent, how much does it cost to make a DVD? How much does shipping cost? How long will it take you to create and give your backers all the rewards? The best extras are those that are affordable and have “value” for the moviegoers who are supporting your project.
The 25-dollar reward is the most widely used token of appreciation, according to Kickstarter. It’s comparable to what a DVD would cost in a store, but prior to creating a specific perk, estimate how much time and money it will actually cost you to create it. Additionally, determine what proportion of the total funds raised will go toward perk production. If your earnings from flipping burgers at a fast food restaurant are less than these expenses, look for another reward. Making your movie should take up as much time as possible, not creating rewards for your crowdfunding campaign.
Final Reflections
It is common to put a lot of effort into raising money once you have made the decision to go for it and have learned the finer points of trying to get crowdfunding. Losing momentum and energy during the film’s production could result from this. Ideally, create a sound plan, work on deadlines, and have backup plans ready in case of a contingency. Keep your attention on your goal of making your movie an Oscar winner while doing the same.
Applying for a 501c3 is another quick tip that is frequently forgotten, but you never know if it will make your movie tax-exempt.
