10 Tips to Help Attract Investors
1. MINE YOUR OWN NETWORK OF PEOPLE: Call everyone you know (your entire “Map of Relationships”) and tell them exactly what you are doing — and make a request! When my film partner, Kate Robbins, and I had finished producing our first four bigger budget indie films we decided to take a break and have some fun producing a few SAG ultra-low projects. We literally called everyone we knew and told them what we were planning and why. We explained that we were putting the final touches on our business plan, private placement memorandum and operating agreement for our horror film “Candy Stripers.” We had opened our LLC as well and we made our request simple. After I shared a bit about the project and how much the units/shares were going to be, I said, “if you’re interested in possibly investing and want to take a look at our Business Plan packet we’d be more than happy to send it along.”
2. DO MORE NETWORKING! Go to events, festivals, screenings and parties and get to know more people and tell them what you are up to. Be clear, brief and specific. A colleague of mine produced his trailer first and put it on his iPhone. These days with online crowdfunding you can raise the money for a trailer, poster and other items to help create a stronger package. My colleague made a point to go to events and parties. While he was at a party he shared that he was at the stage where it was time for him to start funding his film. As folks asked him more about it he said, “Let me show you instead.” One of the men he showed the trailer to that night just happened to be a big fan of sci-fi films and he because his sole investor. The budget was $500,000! When I was interviewing producers on this topic a few years ago they did stress how important it is to really know your project and be prepared to pitch. “Know your project and your plan inside and out to the extent that you could pitch it to anyone, under any circumstances, from any angle.” Another producer suggested that you “take a good, hard objective look at your own materials, as if you were investing your own money: would you? Do you buy the figures? Are the assumptions solid? Has every step been taken to mitigate your risk and limit your exposure? Is the plan solid? Is this a film you’d want to go see and one you’d be proud of having been involved in? Can you sell it like you believe in it?” All fantastic questions to ask yourself.
3. FIND OTHER GREAT PEOPLE WHO CAN HELP YOU: One thing that Kate and I did on our SAG ultra-low-budget films was offer an Associate Producer’s fee and credit if our friends were able to introduce us to people who ended up buying units/shares on our films. And if they brought on people who bought six or more units they would get an Executive Producer credit. It really was a win/win for everyone.
4. OFFER AN EXECUTIVE PRODUCER CREDIT TO INVESTORS: To investors who bought six or more units we offered an Executive Producer credit on a single card in the main titles and on the billing block of the poster. Many people who were looking to start their own film company really liked this opportunity. In the case of our low budget thriller, “Portal,” we sold two sets of six units immediately to people who were starting their own film companies and they wanted the credit. One in Philadelphia and one in Phoenix. And since we only had thirty-five units to sell on each of those films, selling twelve in the first couple of days really helped.
5. CREDIBILITY IS KEY – PARTNER UP: Any time I was teaching my indie film producing workshop, participants would always complain that it was just too difficult to raise their film funds because no one was taking them seriously. In many cases it was their first film and any potential investors they spoke with were concerned that they wouldn’t follow through. So, the advice I gave them was to partner up with someone who had the credibility… had produced films in the past. When I was moving back into producing bigger projects I did exactly what I’m suggesting here. The biggest feature I produced had a budget of $10 million and I had just optioned a script with a budget that was double that. The first thing I did was to team up with a great film producer who had produced a number of big budget films. Having his name attached and his bio as part of the business plan made all the difference. Having a partner who has more experience and more credibility will help give potential investors a better feeling of security.
6. HOLD A KILLER SALES PRESENTATION: I think this is essential. In fact, I will be featuring an article in a few months that will give you exactly (with tons of details) what Kate and I did to prepare for our Sales Presentation. It is valuable on so many levels. One of the things I noticed during our presentation was how real it all became. I think for a while on those low budget film projects I was living in hope and deep down I don’t know if I truly thought we could do it. Making our bigger budget films seemed so easy since we were working with big name talent which helped get investors and we did very well with presales at that time. This was different. On these smaller films we were asking people we knew personally for money. It was uncomfortable. We started to get stuck and nothing was happening. When we decided to do the sale presentation it changed everything. There was something interesting that happened that night. When we were speaking about shooting Candy Stripers July 12th and that we were stating preproduction mid-June, I actually could feel a shift. When you’re in front of forty or fifty people making a commitment like that, it becomes very real. For the first time, I really believed deep down what I was saying. We did another presentation the following week and in three weeks from the first one, we went from having sold two units (to each other months earlier) to selling twenty-two. And it wasn’t even that a ton of the folks in attendance those two evenings bought units. It was more about who we were being. We were making a movie, period. The train had left the station and there was no turning back.
7. TALK TO SALES AGENTS: Even if you plan to self-distribute your film you have to talk to sales agents well in advance. When Kate and I launched Snowfall Film, Inc. we immediately bought passes for the entire week of the American Film Market. It was expensive but as far as we were concerned it was an investment in our company. We met everyone and we learned about what was selling, what level of cast was necessary for territory sales and so much more. In many cases they gave us a list of name talent that were good for international sales. The information was invaluable. And more importantly we formed relationships with sales agents that have lasted for years. Any time I am about to start a new project I call a few sales agents that have become friends and get their opinions on the cast I’m looking at for the film. I also ask for them for territory sale estimates and I include it as part of my business play. Also, on one of the low budget horror films one of our sales agents was interested in purchasing two units. That was an unexpected benefit!
8. THINK BIG AND THINK GLOBALY: There is a lot of money out there in the world. My first few films ($5 to $10 million) were co-productions with different countries. It may mean teaming up with a producing partner in another country but well worth it if it means getting your movie made. Also, talk to the film commissioners and get educated on State and Provincial tax credits and incentive. Go to location expo. This year it’s happening right at AFM. You will be amazed at how helpful they will be. One of the participants in my Indie Film Producing workshop was planning to shoot her film in the state she was from and they were just starting their incentives. They offered to invite potential investors to two different meeting to hear her film pitch. She raised her entire SAG modified budget during those two meetings. In addition, as I have said in previous articles, talk to people. Share what you are doing. You will be amazed at how many times someone will say, “Of I know someone you should meet.” Or, “I have a broker who might be interested.” Tell people what you’re up to and make requests! I found a great broker this way and I am now working with one of the investors he’s introduced me to who does budgets from five to fifteen million. Perfect.
9. CROWD SOURCING AND COMMON GROUND: Know your target audience. And of course, know your demographic. However, one of the things I learned when I had a film project with MPower Pictures was to look at the various psychographic groups your project will attract. Mine had to do with boy scouts so I was thinking only in terms of boy scouts as my main audience. When we started brainstorming about possible psychographics we realized that since the story took place during a war, we could also include veterans while preparing our marketing strategy. Also, the moms and dads of scouts and guides would be an audience. And certainly grandparents. The more we really looked at the storyline the more groups we came up with. It was amazing. When you include this kind of information in your business plan it will impress investors. They will see a far bigger potential audience and demand for your product. Also, when Richard Botto came to speak to my MFA students at Columbia College he shared about crowdsourcing in a way I’d never heard of before. He said that since most of us these days start marketing and promoting our film online a year or more in advance of production why not target on purpose specific groups to expand our future audience. “Start in the script stage”, he suggested and an example he gave was about a producer who actually worked with the writer to make one of the characters a vegan. He started an online chat group about it and attracted hundreds of thousands of like minded people. Audience building well in advance… brilliant! Be sure to buy a copy of Richard’s book “Crowdsourcing for Filmmakers: Indie Film and the Power of the Crowd.” In a similar vein, it’s smart to look for common ground. If you have a project that has a niche market, use it to your advantage when looking for funding. For example, a faith based project would have an excellent appeal to potential investors who are committed to seeing more of those types of films produced.
10. GIVE INVESTORS A CHANCE TO PLAY: Offer the possibility to investors to really have some fun with you by offering a number of things – having a line in the film, being an extra, just being on the set (make sure you have head sets and chairs for them), getting pictures taken with the stars, inviting them to the Wrap Party and perhaps even recording the song for your end roll credits (which I’ve done). It’s all about having FUN! If you are not having fun with all of this, they won’t have fun and they will go play somewhere else.
BONUS: Something to keep in mind is that this is a business and you are a professional but they are not just investing in your film, they are investing in YOU. And of course, offer them a great deal. Stand in generosity and abundance when you write up your business plan.
Suzanne Lyons is President/Producer of Snowfall Films, Inc. (www.snowfallfilms.com) having produced/exec produced 12 feature films to date. She co-founded the Flash Forward Institute which focused on teaching the tools of business needed to market oneself in the entertainment industry. Her book titled Indie Film Producing: The Craft of Low Budget Filmmaking was published by Focal Press (www.suzannelyons.net/indiefilm). She’s hosted over 130 informational videos for the industry (www.youtube.com/suzannelyons). When time permits she does private career and business coaching. Suzanne is originally Canadian and lives with her husband in Los Angeles, CA.