'Crowd Financing' for Creative Enterprises

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Permalink Reply by din on April 17, 2009 at 5:42

I think it is an absolutely brilliant idea! Obama's campaign is partly or mostly paid by crowd financing.
I am definitely interested to know if anyone else has had any experience on this.

din
mereka.co.uk

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Permalink Reply by Andy Lovatt on April 17, 2009 at 9:12

Interesting development for funding film with a novel take on the rewards on offer for such investment. Can't help thinking that offers of bit parts and 'credits' on a short film are extending the nation of a vanity project to new extremes. Either that or a profitable take on our celebrity obsessed society; which I like. Would be interesting to see if people can use the crowd to finance projects that may deliver a real return on their investment. That said, credit where credit is due to all those taking up the idea and making it happen.

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Permalink Reply by Stella Onions on April 17, 2009 at 10:05

This is very interesting as I am about to employ what you refer to as 'crowd financing' in order to fund the 1st issue - at least, of the magazine. Currently looking into using Paypal to make receiving funds easier. I got my idea from the Million Campaign Homepage and my plan is to sell tiny boxes on the back cover. Suggestions / ideas appreciated, thanks,
S

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Permalink Reply by Fiona Maher on April 17, 2009 at 16:40

As David has already mentioned, the crowd financing of my own film, The Tree of Death, has brought nothing but benefits. This is the film that I part financed by advertising roles in it on eBay, and it's due to be completed later this year.

The traditional method of financing a film is to fill in endless forms for The Film Council. I know, I've done it and was lucky enough to get one financed that way. Elliot Grove (the founder of filmmaking organisation Raindance) says that by the time you fill in all the forms, you could have gone and raised the funding yourself privately, as that's what most American filmmakers do.

However, that's the States, where doctors and orthodontists are seen as an easy touch for filmmakers and there's a bigger culture of 'ordinary' people investing in film. Whilst there are tax breaks here, they were shredded a few years ago by our then Chancellor Gordon Brown in a futile attempt to keep 'Dirty Money' out of the filmmaking economy.

So where does that leave us?

We all have to stand or fall by our ability to inspire our investors.

BACKGROUND
The initial ads were run on eBay for two weeks under the banner 'Bid for Stardom'. The Tree of Death is a comedy film that takes apart all the vanities of filmmakers and filmmaking, and is about how a bad horror film is made. The one second pitch is 'Blair Witch meets Spinal Tap'.

However, the entire project had to be pre-proofed against REALLY bad actors buying roles. As an eBay auction is so open, literally anyone could have bid for a part. So I had to have a strategy in place where someone's total inability to act could be made a into a virtue by putting them into the bad film within the (hopefully good) film. As it turned out, no one was unable to act, and some of the successful bidders were resting actors anyway.

UNEXPECTED BENEFITS
Raising seed funding from eBay gave the money men the clue that I was a sharp cookie worth watching, and this reputation follows me still. Naturally this led on to far more serious investment from the private sector. Happily this situation has continued onto other projects.

Using unorthodox methods to fund your project marks you out as a maverick, and generates a real buzz of interest. When the eBay ads were running, I appeared in a few newspapers and on local radio and was followed around by a BBC documentary crew. It's all brilliant publicity - and it's totally free! And more publicity generates more investors eager to help out financially - what's not to like?

Using a simple but brilliant idea to raise money lifts its originator high above the masses of people doing the same thing.

It caries the inherent implication that an awful lot of people must have liked the original idea to have put money in. It promises a project worlds away from the kind of depressing films made by the type of funding spongers who would never be able to get private money to make their films anyway.

NEXT STEPS
Imdb (the Internet Movie Database) have identified me as an up and coming director, and have given me a hallowed professional page on their site. Although it's in parked mode until The Tree of Death is finished, it's still attracted interest from two American distributors. Further to this eBay radio (yes it exists) are keen to follow the project up when the film is completed. This is all accruing whilst the film is out of sight and going through a prolonged re-edit, so it seems unusual financing routes really do cause bigger and lasting ripples on peoples' consciousness.

Others will probably follow suit and use eBay to finance their films, but I'm the one who'll go down in history as The First One To Do It.

I would heartily recommend crowd financing to anyone. You just need that one breakout idea to fire up peoples' imaginations, then hang on - because you're in for a real rollercoaster ride!

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Permalink Reply by Stella Onions on April 17, 2009 at 17:16

Thank you Fiona! I have just had a EUREKA moment after reading your reply! Thank you so very much!
Off now to make it happen!
S

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Permalink Reply by Chris Green on May 24, 2009 at 18:23

Fiona.
Can you please advise what your advert looked like as I would like to follow your successful mudule for my first feature film Best Laid Plans starring Steve Evets (Looking for Eric) and Tamer Hassan (The Business, Football Factory)
Any advice would be greatly appreciated.
Regards
Chris

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Permalink Reply by Fiona Maher on May 24, 2009 at 21:17

Hi Chris,
Unfortunately the original ad hasn't been archived, but I ran it under the eyecatching banner 'Bid for Stardom' geddit?! The main photograph was a 'behind the scenes' still from a short film I'd previously made with a huge crew, so it had a real feature film look to it. I remember putting up four further photographs from 'ExpiryDate' a feature I'd written and worked on. Above all, I had to reassure any potential bidders that I'd at least got some experience.
The copy was geared to be attractive to as wide a range of people as possible. I thought it might appeal to someone keen to get an acting career off the ground, or for seasoned hands, resting or in retirement. Fresh material for acting show reels, that kind of thing. I even suggested that a role in a movie could be the ultimate Christmas gift for the person who has everything!
Email me at info@fionamaherfilms.co.uk if you need more help.
Best,
Fiona

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Permalink Reply by Felix Holm on April 18, 2009 at 15:12

hi there was a film made here in South Africa, based on the story of Oliver Twist, using exacly this method of crowd financing. see the website.

http://www.twistmovie.co.za/

a 1000 investors were asked t contribute a R1000 [ USD 100 +/-] to the film, if i am correct i think it gave them shares if the film ever became profitable??? [under correction]

check it out, was nominated at canes, and won an award at the Apollo film festival

cheers Felix

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Permalink Reply by David Parrish on April 18, 2009 at 16:22

Thanks Felix !
Very interesting...

Best wishes
David

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Permalink Reply by g2i gateway2investment on April 19, 2009 at 0:44

I guess there's something slightly skewed about buying yourself a part in a movie but ... in general terms ... as a full time investor I love the idea that creative people are going out there and seeking validation from the marketplace right at the start of launching a new enterprise.

So often I see business plans and there's this story when you read between the lines:

If only someone would invest 100k/1m (delete as applicable), then the brilliance of my idea would shine out to the world - oh and by the way - you money people will get really rich too

It sucks!

I wrote recently about someone I mentored who (all thanks to her own efforts) raised 260k through a conventional Business Angel route. The overwhelming thing that came through to me about her story was the way that she had used a very small seed of initial investment to get something up and out there, then she'd thought very hard about it and changed her ideas, in response to what the market told her that it wanted. What she didn't do was start with some kind of messianic arrogant view that she knew best, try and find a schmuck to finance it, then fall flat on her face when actually the little people out there wanted something a tad different.

So ... bring this back to the topic ... if 'crowd financing' is a way to get in touch with that group of 'early adopters' who will see the merit in an idea, punt a few quid on it and allow a creative or technical team to try something out, I think that's wonderful. Once the idea is proven and chunkier wodges of cash are required to take something to the next level, someone who had been financed that way at the start would have a really strong argument to put to investors that the market for their idea was real.

Hugh Mason, Partner, Pembridge Partners

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Permalink Reply by David Parrish on April 19, 2009 at 19:38

Thanks Hugh !
Great post.
Thanks for the information and link.
Cheers

Dave

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Permalink Reply by g2i gateway2investment on April 20, 2009 at 13:48

You're welcome - I did some poking around and wrote an extended post then discovered that some would include crowd financing in a broader category of new approaches to getting stuff done - crowdsourcing - on which subject I found this excellent post on ReadWriteWeb

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