David Benavente (VP of Independent Sales & Production Incentives at Cast & Crew) and Ryan Broussard (VP of Sales & Production Incentives at Media Services) sat down with Slamdance alumni Chelsea Christer and Jessica Farrell to share their experience and advice for emerging filmmakers, covering an array of production topics including financing, tax incentives and more to help prepare you for your next project.
Watch the full panel or check out some highlights below.
On who to have on board when you start budgeting
JF: I would say always think about how you want to collaborate. The first thing before you even jump to a line producer, production assistant, anything smaller in that realm, think about your above-the-line producer. This person is really going to be your mom. Producers help with budget, help pitch, get distribution. All the way from A to Z. It’s a big commitment so you need to collaborate with the right person and make sure they fit your project.
RB: Accept that you don’t know everything and team up with people that know more than you and be OK with that. Our big philosophy is — with independents — small fish become big fish.
On the paperwork to have in place as you build your team
JF: Start with your budget. It’s your bread and butter and your breakdown of a roadmap. Even when you do grants, your budget tells the truth of what you’re strategizing and what you’re planning and how you want to pull this off. Think about what you really need in production, pre and post. Think about saving even like five grand to promote and get a publicist. It’s all part of the journey. The next thing is definitely thinking about crew deal memos/cast deal memos. It’s a big part of that negotiation, even to get SAG moving on your project. Starting it early is to your benefit.
RB: Make sure you have real numbers, real fringes for your payroll, real costs, let it be grounded in the reality of where you’re going. We offer a budgeting software called Show-Biz Budgeting. There’s industry-standard version of budgets. Everything is going digital in this world and that’s something that we’re really pushing forward with. The boring parts are the backbone of the movie and they can’t be ignored.
DB: When you’re looking for money, it’s your presentation, too. You want to find out what the industry standards are whether you’re doing a $50,000 film or a $150 million film. Be professional.
CC: Bringing in a lawyer early is also critical. Just having someone who can look over the contracts, look over the paperwork. You’re going to feel so much more protected as a creative, as a business person, to have that infrastructure in place and have that legal partner who actually knows this industry
On having a finance plan and building your budget
DB: The budget is the whole and the finance plan is made up of different elements: investments through equity, grants, a film loan, senior lending, tax credits, and tax incentives.
RB: Sell yourself and sell your project and put yourself out there. It’s great to be passionate about your project. It's great to have that side of the brain of creativity and that’s why you got into this. But you’ve got to use the other side of the brain too, and be there to sell it for the money people. For the people that will help fund your project because, you know, there’s so many projects.
On film equity
DB: Equity is basically just money that’s not attached to a collateral, per se, but really just an investment into the film. Whereas all other lending and borrowing is attached to collateral almost 90% of the time. A tax credit is a piece of collateral that you can borrow money against. The better the collateral, the cheaper the loan.
On MGs
DB: MG’s are minimum guarantees. Basically what it is is you have a distributor and for example you have this martial arts film and he goes, martial arts films do fantastic in Eastern European countries. In order to distribute the film, I’ll give you a minimum guarantee of $100,000 because he knows he can do $200,000. So he’ll give you a minimum guarantee so you can borrow against it.
JF: Don’t be intimidated by MGs and approaching distributors for pre-sales. Both of my features that went to Slamdance within that six months following both got distributors and keeping those relationships, rolling them into the next stuff is all worth it and how you can approach it.
On grants
DB: Don’t ignore grants! Talk to as many people as possible and know what the subject matter is. Research if there are any grants out there that might fit into that category.
JF: One of my documentaries got $75,000 worth of grants already and it's just getting off the ground. Your synopsis is pitchable.
On tax incentives
DB: All tax incentives in the US and Canada have their unique set of rules.
RB: Lots of states have compensation caps where that say, for example, OK we will give you 25% on labor but we’ll cap it at 500,000. You’ll lose money so you want to go to a place that doesn’t have a compensation cap. You have to find the state that matches your budget and what you’re going for. There's 3 different types of programs: rebates and grants which are cash, credits, transferable credits like in Georgia. Once you get your credit there, you can’t turn it into cash on your own. You have to go and sell it to somebody that has Georgia liability.
RB: Incentives are used by states to drive up their economic impact. They want you. Think about utilizing the local stuff. Flag your budget and know what you’re doing in the state and what you’re not doing in the state as each state has different incentives and set of rules
DB: The whole concept of a tax credit is to incentivize people to bring their business there. Look for states that incentivize the project you are working on.
RB: Incentives for having a diverse cast or crew. New Jersey gives you a 2% bump
CC: Grant paperwork forces you to write about your project and then understand what you are pitching to your audience. UCLA has a “poor” documentary filmmaker fund where they basically allow their students to review paperwork for free.