Random Thoughts on Financing and Distribution

I just got back from a lecture on independent filmmaking this evening.  The speakers were a husband and wife.  She runs a local film festival and he runs a local film production studio and is the son of a very famous football coach.  It was really interesting to hear about their jobs, how they got into the film industry, how they met, and the projects they have worked on.

One interesting story he told was of a film that he had invested in.  It had been a real attention getter at Sundance and had been nominated for two Academy Awards.  You would think that with credentials like that they would make a real nice profit on this film, but the highest price a distributor was willing to pay was only a third of the film’s budget.  Needless to say, he and all the other investors lost money on that film.

This is the kind of story I’ve heard over and over again.  Most people think that producers who get their films picked up by major distributors make a lot of money, right?  Wrong.  In most cases it’s the distributors who make the money.  And who ends up getting screwed?  The investors.  So why would anyone want to sell their film to a major distributor?  Well, because the opportunity to get the kind of exposure that comes with a wide release is very tempting to a producer.  It means that they will become known and that could give them more clout in future negotiations which lead to greater profits for subsequent films.

There’s only one problem with that:  you’ve screwed your investors.  Why in the world would anyone want to invest in a film where they knew they would lose money?  Now some investors love film or believe in a specific project and just want to be a part of it so they’re willing to take the risk.  But most are in it to make money.  It’s an investment and they want to see a return on their money.  I can’t blame them for that. 

Some producers justify accepting these distributor deals by saying that their investors are rich and can afford to lose the money.  Yes, they do have to have a certain amount of wealth to qualify as an accredited investor.  But does that justify taking their money knowing full well they will never see a return on it?  My view on this is no.  I find it unconscionable that producers would screw the very people that helped to make their film possible.  I may get labeled idealistic or naive for this viewpoint.  Fine.  But I won’t compromise my integrity for anything or anyone. 

I strongly believe that producers have a fiduciary responsibility to their investors.  It’s not only the job of the producer to make a quality film that is appealing to the audience, but it is also the producer’s job to try to the best of their ability to make a profit on the film and, at the very least, pay back the investors’ money.

Getting a distribution deal with a major distributor is every producer’s dream and I’m by no means against it if they are willing to offer a fair deal.  But the more I hear about how tough it is to get a fair deal, the more I have begun to explore other options.  I’ve heard that sometimes a smaller distributor will offer a more equitable deal and it’s something I want to look into further.

A question I asked the producer tonight was whether he thought that self distribution was the way to go.  He said yes, but he said to be sure to team up with someone who has done it.  Self distribution is something I definitely want to explore.  From everything I’ve heard it’s a huge amount of work.  But if you are going to spend huge amounts of time and effort to get your film made, why woudn’t you spend the effort to make sure your film gets distributed and makes money?  It’s what any business in any other industry would do. 

In every other industry out there businesses make sure that they have a plan and work that plan for getting their products distributed.  But in the film industry I’ve seen filmmakers shrug in defeat when they say they couldn’t get their film picked up by a distributor.  Seriously?  My jaw drops whenever I hear this.  This is a business!  Treat it like a business! 

The film industry is the only business I’ve seen where many people give all their attention to making the product and no thought to distributing and marketing it.  Granted, if you’ve got a bad product, you’re just not going to find many customers who will want to buy it.  But that’s no excuse for not trying. 

I do want to qualify what I just said and emphasize that not all filmmakers drop the ball when it comes to distribution.  There are many savvy producers out there who do know how to maximize profits on their films.  Unfortunately, there also seem to be a lot who don’t.


4 thoughts on “Random Thoughts on Financing and Distribution

  1. Great blog! I think you hit the nail on the head about many filmmakers not treating their profession as a business.

    If you don’t mind, please pass along any links or other info you dig up on self-distribution. I’m curious to see how it works. The barriers to entry are so high!

  2. Thanks! It looks like someone else thought it was good too. It got picked up on a film industry news blog.

    I’m more focused on writing right now, but I’ll pass on anything interesting that I dig up.

  3. Not to diminish the terrific points this blog entry makes–I just wanted to point out something I think is a little funny. The e-mail version of your blog always inserts question marks wherever regular punctuation goes, so everything reads like a question: “I just got back from a lecture on independent filmmaking this evening.? The speakers were a husband and wife.?”

  4. How weird and funny.

    Do you get the emails in daily digest form? If so, you might want to change your setting to get individual emails. I get both versions (to make sure they both go through) and the individual emails I get look fine but the daily digest is a mess…really hard to read.

    If that’s not the issue, it may be your email program.

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