WHAT DO INVESTORS WANT IN RETURN FOR INVESTING IN YOUR MOVIE

With the market still struggling and real estate in a rut, conventional investment vehicles look like less of a draw to many professional investors.

There is a general distrust in stocks, commercial real estate is predicted to plummet and residential real estate is at best a very long-term bet. For those seeking an alternative, debt and equity funding of independent film is one possible solution.

Many independent film makers are turning to venture capital as they seek out alternative vehicles that can assure them of some stability in raising funds for their projects. Competition for funding remains fierce, and venture funds can be more explicit in their benchmarks and more demanding about transparency. Moreover, some investors can demand a surprisingly high stake in projects they support.

According to the Center for Venture Research at the University of New Hampshire, angel investors typically require 20% to 40% annually. As a result, very few films get made unless they can prove, upfront, that they can make money in the theatre or DVD and have other auxiliary products which can be tied into marketing.

Investing in a film project is risky. According to research, more than 90% of all independent films lose money due to high marketing, post-production and  distribution costs. Those looking for funding today will have to endure tougher questions and be prepared to offer rock solid business plans.

Make sure your market is sizable

The first thing investors look for is the size of your market. Their sweet spot? Movies than can be made for $500,000 or less. Investors want to know why adult men, adult women, boys and girls will want to go to see your film. They want to know that you have done your homework.

Boost your business prowess

Investors want to be sure that you can handle running a film production company; that you can persevere through late nights and few payoffs for a potentially long period of time. Having made and sold a film in your past can help reassure investors. However, regardless of your experience, being able to furnish references that speak to your abilities is vital.
Build a balanced production team

Investors are also looking for independent film makers who display enough business acumen, leadership skills and charisma to lead a project from conception to distribution. You've also got to be able to demonstrate familiarity with your field. If you don't carry those characteristics in spades, make sure you partner up or hire wisely to account for your shortcomings.

Make sure your production team includes a seasoned director, director of photography and line producer.
Get some seasoning

Most VC firms and angel investors are looking for film makers with more time in the market before they invest. So firms looking for their first film should spend more time raising rounds of financing from friends and family.

If you cannot raise funds for a large project, scale it down. Make a trailer and show it at festivals. Continue to hone your skills and experience.
Show them your script, attachments and business plan

Without a polished script, written attachments from actors and a well-written business plan you are going nowhere. Investors bet on written strategy, not creative genius.

Call me at 1-888-494-2468 to discuss your next project.