Financing / Crowdfunding : Regarding Film Financing by Vassilis Kontodimas

Vassilis Kontodimas

Regarding Film Financing

Hello everyone!

I've been absent from Stage32 for a significant amount of time, building a rather huge franchise & orbiting the various financing options. Getting your film off the ground can be gruesome & you'll encounter quite a few traps. So, be prepared to become some sort of "Yoda" on the legal and business documents.

Anyhow, I've been going after a lot of different procedures on financing my project, which is not a small one, but it is an independent nonetheless, which means similar rules apply - especially when we keep big studios out on purpose. Returning here and having a small look as to what is going on around, I decided to relay my team's and my own experience on the subject.

There might be those who think that I am coming here to "charge for consulting" (I heard that one before), I am merely offering information and tips. Nothing more. They come from the grind and the pits of financing hell!

I'll be posting the second and more hard-core part of the financing post & if you wish for the "overview", you can then visit the first part.

I hope this helps out!

https://indulgentmind.com/2018/03/08/film-financing-part-2/

Let's get Hardcore - Film Financing - Part 2
Let's get Hardcore - Film Financing - Part 2
Now that you've reached here, I can offer a few tips as to how you can get your project ready for financing. All of this comes from actual experience, dealing with industry veterans through email, pho…
Vassilis Kontodimas

Hey Vitaly!

Thank you so much for your response! Yes, you are correct on several aspects. This is where the tricks of the trade are:

1. I am not the sole producer - I have a big name alongside me (so it's not just me)

2. Our director has won an Emmy, so he's not exactly new. Even the Godzilla was led by a director who had previously done only shorts. One of the main prerequisites for big films is for a director to have delivered a feature film & have done some proof of concept. - This is indeed a tough path, I agree. It just happens that we all believe in him.

3. I have some strong executives that are adept at budget management.

4. It is not unheard of for jumps like this - especially with the plethora of film funds that are forming.

It takes guts, dedication and a lot & I mean a lot of courage. The fact that we did not receive as many "no" as we thought (we did receive quite a few "yes", but we had to extend our journey through distribution). What I write in my blog is basically what I learned and what can fit within a decent amount of space. Also, I did not mention the talents we had on-board, who were no small people (from large agencies, whose names we don't have on IMDb - which was the initial deal, until the Pay-or-Play is fulfilled).

Nor did I report the department heads and companies behind it (those are under strict NDAs).

In due time (and head permitting), I intend to expand on relating subjects.

Thank you again for your comment and your support (or at least it sounds like one)! We are far from done yet, especially since we have several more weapons in our arsenal. The goals remain the same, it's just the plan that changes.

Vassilis Kontodimas

I never claimed it was going to be easy, that's for sure. The first time I presented an old draft to an executive, I was "kicked" to push it forward - just because I was able to package CGI projects for other people in the past.

The truth is we were ready to launch Autumn of 2016, Spring of 2017 and then finally Autumn of 2017 - if not for the fallout one executive had with two financiers last minute & shook the whole project. However, this is in the past now, so I decided to take on a different approach.

The real packaging is a lot different with all the materials & the actual principal photography sits at about 24 million, if memory serves me well. Most are the cast required fees (yes, there are some considerate names) along with exec % requirements & around 27 million in full post & VFX. The IMDb hasn't been updated in a while, but the total budget - since we locked on the currency, is at 87 million (including early promotion marketing plans) & after talking with the Toronto film office, the incentives we are eligible for further reduce it to approximately 65 million USD. That's quite the difference from the 100 one.

Once we secure a reputable distribution verification on the market projections we already have, there's at least a 50% financing in waiting from a reputable fund (actual investment, not matching funds). It's a tough process, but sooner or later, it will be done. :-)

Patricia Poulos

Hi Vassilis,

How impressive. Thank you for sharing. I am intending (intending being the operative word) making a film from one of my five scripts.

Thank you for giving us some hope of succeeding.

Kindest regards,

Patricia

Vassilis Kontodimas

Hello Patricia,

It may seem impressive, though it's a rough trek - but doable if your heart is into it. The "advantage" I have is that I see things from the advertising/communication/business aspect, in which I've been entangled for decades. It is incredible what kind of alternatives lurk out there, which are virtually invisible from within the actual film industry.

These - of course - are nowhere visible on a simple IMDb profile - nor is the fact that that I helped elevate a small team to production company of the year, twice in Greece - generating tens of millions of Euros. This alone shows that there can be a variety of options & financing a project is never a one-way street.

I am not going to lie. It's going to be hard, but do focus on the business & legal aspect very early, including marketing. Build relationships and the rest will come. :-)

Eric Ross Gilliatt

When reading Vassilis Kontodimas' post here about being a first-timer finding project financing, I always want to remind everyone instantly that it took a young man named George Lucas FIVE YEARS to find the financing for his first "Star Wars" trilogy film, "New Hope." He only got it when he promised his good friend, Alan Ladd, Jr., then CEO of Paramount, he would give him make certain films later for him...everyone else turned him down!!

Vassilis is correct in so much as it takes obsession, not mere dedication to break thru to the other side for money. My current feature project, one of many in final development, has taken over 3 years to reach the right plateaus. Like Lucas with Mr. Ladd, it was very much an exercise in establishing credibility and most importantly, establishing connections and knowing the right people. If you want to do business in Hollywood, you will do business the "Hollywood way." There are "rules" which are standards for both legitimacy of your project and thus consideration for financing. Budgets must be realistic. A "low budget film" has limited distribution potential because it typically lacks the talent people will want to pay and see. You have to decide what you want and will accept...the less money you budget, usually the harder it is to get the money...but, not impossible. P & A is a huge factor for indies. Decide first what money, and how you will receive it first..(only above the line on the front) or just selling it as a screenplay, or in distribution as a "favored nation" clause (usually only talent, screenwriters, and producers.)

Attaching a good director, and then good talent (A-list) is generally the heart of a successful effort to find both distribution, and in turn financing. As a producer forming a project, I knew only a winning screenplay would work. I adapted a best-selling novel from an up-and-coming author friend, looked around intently on social media for other connections in the industry, wrote to countless ones, learned who was who, and established friendships and working trust. Today I have two top co-producer partners in the US, and one top co-producer partner here in Kyiv. My partner here already has a top feature film released and came to me thru our production company's internet website looking for a project to be part of...that is how the system works, especially when your projects are in the $50M+ range and you are attaching A-list stars and an A-list director. It is also how you do it in the $5M range without A-listers...it is not so much who you are, it is most assuredly, who you know and your reputation. Good luck.

Dan MaxXx

George Lucas was nominated for an Oscar for American Graffiti. People forget he had a box office track record before Star Wars which he funded out of his own pocket.

$100mil budgets? You could hire director Ridley Scott and cast Jenn Lawrence and Michael B Jordan. Even hire an Oscar winning screenwriter.

These numbers and this business plan don't make any sense but good luck. It's show biz, all fantasy.

Vassilis Kontodimas

I agree with the posts above. This is why I am not directing, nor do I have any desire to. I just happen to be the creator who knows what is taking place & I do have a good deal of hands-on experience in post production and setting up entire facilities from the ground up, in addition to presentations and building effective marketing plans (I worked with advertising as well). Hence I was placed to this position, which I admit is a demanding one.

As to the cast, yes, we do have A-List in there, just (as I mentioned above) not listed publicly. It’s all in the support docs, including our back-and-forths with the respective agencies. Same goes for the extended crew team & post. Some with over 100 credits under their belt. As a small example I could mention District 9, which had no A-List package, cost $30 million and grossed $180 million, simply based on a very smart marketing campaign by Sony.

Also yes, there is a standard “golden” rule for financing in Hollywood (Hollywood being the operative word). However, it is not the only one. In the more recent years, there has been a greater diversity in regards to production companies, where most studios enter in the distribution arena. The latter part has been our focus, because we do have the ROI capacity.

Playing solely by that “golden” rule comes with a lot of “Catch-22”. Financiers seek a full A-List package, while the A-List agents require the full financing before even considering. The fact that we were able to get at least some of both at the same time is a good step. No doubt there will be further negotiations, but we are nowhere near hopeless.

Everything, always, comes down to the audience. This is what A-List and good marketing are required. The former comes with a set number easier, which is one of the major reasons as to why they are sought. The latter needs some more work. However, the moment a film can be delivered on-time and on-budget, while building a good audience base, that’s what reassures the box office and – by extension – the investing parties.

Conclusively, just looking at all the “Catch-22” parts, can have everyone discouraged – and it actually has. So, we are being a bit more creative, especially since we do have financing specialists on our team, who worked on huge firms before. I am not a loner who just runs around, hoping for the best. The biggest mistake we did initially was to rely on brokers. Not any more.

Last but not least, the budget isn’t $100 million (as I also stated above). The actual required investment is at $65 million. The moment we get the verification of the projections, it will go down to $30m. That’s for the reason (also stated above), that we have financing parties ready, none of which is from the US. Now, these people must have seen something in our packaging, no?

Dan MaxXx

Vassilis Kontodimas what year is this current movie package? It takes 5 years for the average movie from paper to screen.

I am not 100% but didn't Peter jackson bankroll District 9? And Jackson's company did all the special efxs.

From what Ive been exposed, most folks lend their names and contacts for a piece of development money. Years, decades go by and movie never gets made.

Vassilis Kontodimas

Dan MaxXx the package is updated to Autumn 2017, though we did start our more dedicated efforts on Summer 2014 (and we updated our packaging as more data came along). We got really close by the end of 2016 and end of 2017, if not for an executive fall-out with certain financiers.

Also the D9 didn't have Jackson's company involved. The VFX was done in Vancouver, by Image Engine.

Dan MaxXx

Vassilis Kontodimas so you are in Year 4. Same Director and Actors from year 2014 package plan?

Anyways best of Luck. Just get your fee to make up for 4++ years of hustling.

Vassilis Kontodimas

Dan MaxXx nope, not the same package. Things evolved since.

Vitaly Kozlov your comment alone indicates the love you have for your art. ;-)

Doug Nelson

Film producing (aka herding cats) is one of the leading causes of premature balding and high blood pressure.

Dan MaxXx

Vassilis Kontodimas how do you make money to survive 4 years of chasing money to finance a movie?

Jon Jed

I'm in the same boat, don't quit your day job:)

Ryan McCoy

Wow.....

Patricia Poulos

Thanks Vassilis for taking the time.

Vassilis Kontodimas

Dan MaxXx , I have various sources, one of them is being a post-production & visual effects veteran. I've known people that are trying for a lot more, but it doesn't mean they just sit idly, waiting for the jackpot.

Stanley N. Lozowski

IS ANYONE HERE GOING TO CANNES? DOES ANYONE HAVE $10,000 or less and want to double or triple it fast? We finally have a signed agreement for tens of millions in funding and my partner has invites to party on the private yachts at the Cannes Film Festival to meet the Executive Producers and obtain the first funds. He's been pre-producing THE GIANT in Warsaw Poland and has run out of money to get to Cannes... Write me: filmtiq@gmail.com or call: 516-587-0566

NEVER, NEVER QUIT YOU JOB!!!! I'm retired living in NY and Cablevision owes me big money, but I must wait to collect it. SO CLOSE and yet SO FAR...

Vassilis Kontodimas

$10,000 for what reason, if I may ask?

Stanley N. Lozowski

The Euro cost $1.04 when John went to Europe last year.

Thanks to our President who called Climate Warming a sham and pissed off all the European leaders by wanting some to pay him millions because we pay more for NATO than they do, many Europeans no longer like us.

When our President wouldn't pay down the trillions of dollars in debt that we owe and instead gave himself, Ivanka and the rest of his family and all his billionaire friends and all the billionaire corporations each a billion+ dollars in tax refunds, Europe lost faith in our ability to pay what we owe.

I understand that my partner John Mark has lost about $16,000 because the USA is a multi-trillion debtor nation that will add another $1.5 trillion to our debt and not pay anyone back and why would anyone want to accept collapsing dollars? The Euro now costs $1.24 each instead of $1.04. That's almost a 20% loss.

Having lost $16,000, John needs money to pay his expenses to live in Europe for last month, to travel to Cannes where all the rooms, food, amenities and everything else has doubled in price for the Film Festival and because $10,000 now only buys €8,250.35...

Stanley N. Lozowski

If anyone is free to fly to Cannes, share expenses, and work with John to learn "hands-on" International Producing, you can learn about making funding agreements and contracts and work with us as we fund our next five features and serialized TV shows and we can also take your project(s) and possibly arrange funding and/or (if it's completed) worldwide theatrical distribution with all P and A through one of the six top Hollywood distributors.

Vassilis Kontodimas

Stanley N. Lozowski, if John has these powerful connections that you mention, then he obviously doesn't need to ask some "unknown" producers for money under a mere promise & a possible "option" about their project being made. Sorry, but this yells scam all over.

Christopher McDonell

419

Stanley N. Lozowski

Vassilis, Your "Let’s get Hardcore – Film Financing – Part 2" is excellent and right on the money! We should probably work together.

I took on John Mark's exceptional $300 million project and followed up with a wonderful $900 million project last year. I had John look at it because he told me that there was no way it could cost $900 million.

He called and said, "I told you it wasn't $900 million. We can get get it made right here in Europe for only $700 millions." That was last year when those dollars bought €673,076,923.

This year we need $868 million to buy the same €673 Euros and they could soon cost $900 million...

Vassilis Kontodimas

Stanley N. Lozowski, first rule of the day: lock your project's currency, including the according crew. Does Mark have a track record to handle projects of this magnitude?

Stanley N. Lozowski

lock your project's currency, including the according crew.

He is in the process of doing this...I advised John about the currency problem.

Does Mark have a track record to handle projects of this magnitude?

I think so, because of his long association with Sony. John Mark absolutely knows his way around.

I'm working with him and he has two wonderful attorneys here in the USA.

I secured an executive producer who is also an international lawyer in Greece/Berlin/Toronto/USA to advise him.

...and several other people who had experience producing large budget features in Europe.

Is there anyway you can arrange a small loan? I have a UK company on the line agreeing to fund $60 million of the first $75 million.

Stanley N. Lozowski

Vassilis;

I'm at: filmtiq@gmail.com 516 587-0566 NY time 8am -6pm

I began working with John in 2015.

This is John's project : https://adobe.ly/2orhEhD

He will also offer a co-producer credit.

ArcLight Exhibitors in Hollywood projects $700 million (USD) domestic revenue just in the USA for our 8k resolution shot in 3D for IMAX "LISZT AND CHOPIN IN PARIS" feature movie with several billion (USD) from box-office and ancillary revenues from the worldwide release of the feature, sequels and our “500 Years of Music World Tour”. NOTHING like this project is on the market today.

LISZT & CHOPIN IN PARIS is THE FRANCHISE ( like the Pirates of the Caribbean, Star Wars, Harry Potter, Avatar, etc.).

We're currently working on THE GIANT the PREQUEL feature in Warsaw, Poland. This feature starts with life Chopin during his early years, childhood and, growing up as a young man in this amazing city that has been the same for hundreds of years, and then rebuilt to the replica of Warsaw after the Nazis invaded it and practically leveled it. Everything is here and the Polish government, ministry, foundations, etc. will help us.

THE GIANT ends with Chopin leaving for Paris and kicks off our 8k resolution blockbuster epic feature (to be filmed in 3D for IMAX theaters in 2019) titled LISZT & CHOPIN IN PARIS.

The Project, LISZT AND CHOPIN IN PARIS is most similar to a project that was nominated for thirteen Academy Awards. Winning eight Oscars in 1985, Laurence Olivier presented “AMADEUS” with the Best Picture Oscar® at the 57th Academy Awards. Other "epic historical romantic dramas with music" like THE SOUND OF MUSIC and TITANIC (all with "Best Picture of the Year Oscars" and numerous Oscar nominations and awards) are similar but our feature will be filmed in 3D. Signing international contracts and the studio agreements will start in Cannes.

Then we have:

III. CIRCLE OF FRIENDS

IV. THE LATER YEARS

V. MAGICAL MOMENTS

Stanley N. Lozowski

As a retired film-making and television teacher with decades of experience, I always encouraged my students.

I always investigated FIRST and judged projects and people by learning and understanding their circumstances. True artists put a lifetime of work into their projects and I always believed in those who spent their hard-earned money on their dreams and on pre-production.

I cannot understand why some comment and pre-judge because they are either stupid, untalented, jealous or have nothing else to do. It's so easy to sit back and remain silent if you have no money or if you do not have the time to investigate rather than display your lack of intelligence and integrity.

Christopher McDonell

Looks like you can’t understand your own actions.

Christopher McDonell

There’s a great book called “419” by Will Ferguson. A father is victimized by the infamous Nigerian email scam and his daughter sets out on a path to learn more and confront those behind the hoax. Your pitch here on a public forum boasting of 900 m dollar film budgets and promises of worldwide distribution plus P & A for anyone who can send you a small loan is classic, sir. If I’m wrong, you can set the record straight with some verifiable proof and I’ll go back to dreaming of 1% of that money for my next film. Otherwise, hello, Stage32?

Vassilis Kontodimas

I agree with you, Christopher. I went through the link Stanley published and some of the things I saw in there made me cringe. The Executive Summary... may a higher power make it an Executive Summary, as it appears to be written by someone who has no idea what those words mean. Just... read it if you want & laugh your head off.

I kept notes on it, but it's no use giving tips. They're supposed to know what they're doing, no?

Since the documents on the project are on a public server (for crying out loud), I downloaded a few as evidence. No NDA or any other warnings, so it's free range.

And yes, Stage32? Where are you?

Dan MaxXx

Terry Rossio's words:

The Money Guy

Here I hope to save many readers a lot of time.

One common strategy to circumvent the tough odds in the studio system is to pursue the indy film world. It's a viable strategy, but fraught with its own dangers.

Let me tell you about 'the Money Guy.' (I know I should use the more gender neutral 'Money Person' but for me it's always been a guy.) After dozens of interactions with these types, on behalf of myself and others, here is Terry's iron-clad rule of the Money Guy: the one universal truth of the Money Guy is that he doesn't have any money.

Another way to put it -- you will discover the Money Guy has even less money than you do, and oddly, less of an ability to raise money than you do.

To clarify, one can find great success in the independent film world, if you're dealing with a reputable company that has distributed films before. It happens every day. I'm talking about the fringe, friend-of-a friend-who-knows-a-guy-who's-looking-for-a-project-scenario.

Here's how you can spot the Money Guy:

-- the meetings will all take place at Starbucks, or a low-end restaurant. If you do ever see the production offices, they will be a newly-rented closet-sized office with blank walls, a broken mini-fridge in the corner, never an assistant.

-- the promised production funds will have some kind of exotic origin, such as Saudi Arabian oil fields or an Indonesian copper mine.

-- this one is a guarantee. The company with the money will always -- always -- have just completed some much larger and elaborate previous project that costs in the billions. Therefore the paltry $30 million required for this film will of course easily come through.

-- the Money Guy doesn't have the money himself, of course, but he is the liaison to the real Money Person (this person is often a woman) who will be perpetually out of town. If you ever do meet this second Money Person (unlikely) they will turn out to be only a key representative to the shadowy Decision Maker also perpetually out of town, whom you will never meet.

-- the highest priority of the Money Guy will be to negotiate the terms of his 'cut' of the eventual deal. This is often done in conjunction with getting you to sign an NDA. He will be very proud of this document, and refer to it as the NDA, never the longer 'Non-Disclosure Agreement.' You are not allowed to disclose to anyone the secret source of money, nor are you allowed to have a meeting with the real Money Person without the Money Guy present.

Let me add a few words regarding the NDA, as this took me years to figure out. On the face of it, the NDA seems legit, it's presented that Money Guy needs some assurances before revealing his precious and valuable source.

But one day it hit me. Wait a second. Shouldn't that protection come from an agreement between the Money Guy... and his source, Money Person? If the Money Guy were truly an appointed representative of the Money Person, the two of them would have the details of their agreement worked out in advance. The fact that the Money Guy needs an NDA with the creator reveals the unhappy truth -- the Money Guy is a fellow seller, and whomever he's planning to approach (if anyone) might never have heard of him, or might even be sick of the sight of him.

Christopher McDonell

This thread has certainly turned into an interesting read! Lots of twists and turns.

Vassilis Kontodimas

Hahaha! Very true, Christopher McDonell! I suppose it comes with our line of work, eh? ;-)

Dan MaxXx very well said and thank you for the additional info on these guys. We had a few run-ins with these types before, but thankfully we never moved on. I suppose one part is that we draft our own Non-Disclosure-Confidentiality-Agreements, which require an introduction with the actual financiers and a mutual exchange of certain documentation. That's prior to sending out any sensitive material.

The truth is that there are a lot of "brokers" who know someone, who know someone. I am grateful to have a member of my team who has worked for financial institutions before & knows how to do proper due diligence through various channels, such as registries, SEC (where required) etc. There are a lot of traps out there. The biggest red-flags are when someone wants a down-deposit or an advance "loan". Those we call the "Nigerian Prince" cases. In another situation, we were "fed" with documentation that was "orbiting" the claims of the "Money-Man" but was never precise. This led us to making calls to these international "benefactors" only to discover they never heard of the guy (just as you suggested).

That's until we started cultivating relationships with actual Funds. We've surpassed the 9 out-of 10 requirements, but it's always that last bit that needs the lots of extra work and a whole new journey. If the first project I pushed through was in the 10-40m USD range, we'd be ready to release by now. The truth was that we were deciphering one of these "Money-Men" for the remaining funds at the same time, which caused a significant delay. Hence when I see those types, part of me wants to go nuclear on them, but I have to keep my mouth shut on public forums. We have alternatives, but we did take a hit.

Along with the types you describe, I've encountered the following three:

1. The "Professionals" who usually can't draft a document properly & claim their time is limited as they gather a lot more financiers than actually required. Those tend to build a "slate" through cheap IP (Intellectual Properties) of a single person, in an attempt to attract more projects and build a collateral. These can take time to pickup on, because they can imitate the real thing convincingly & take a long time to respond. Though the moment they send an "official" document, that's when you can determine exactly who they are.

2. The "Nifty" types. Those I am familiar with from when I was neck-deep in advertising and post-production. With them, you feel like a client that they want to promote your product (your project) & can sound quite convincing at first. However, it's their "super-excitement" that gives them away, as is their sense of urgency. From their 10 words, rest assured that 11 are lies.

3. The actual "Financiers". The only difference with the other two categories, which are the intermediaries or the aspiring EPs, these claim to have the money themselves (through oil-rigs, mining complexes etc.). Only there's a catch... and a huge one here. These people seek property, intellectual or not, to build a certain type of collateral to use against massive loans from banks that they forward and assign to third party corporations without them taking the damage. The very first thing they will do is an extremely ambiguous way of writing, almost legal, which they use to literally undo anything and everything they told you in person or on the phone. The only way to sniff them out is send them an immediate, mutual CNDA (mutual just to sweeten them up, as there are a few legits out there - but few) and if you go past that point (if they're a bad apple, rest assured they'll ignore it), the next thing is proof of funds. If they're serious, they'll get it, otherwise, they'll crack and leave. Oh, let me not forget that these types will demand every and I mean every little documented and signed detail on your project and company before they consider anything,

The real money people never approach projects by themselves and even more rarely through their friends. There can be an introduction, sure, but in general, the money resides in wealth-management firms and specialized Funds that are run by their respective management companies. However, even those require a good checkup in the according registries, as we found a case where a common name was used - to throw the due-diligence people off.

Dayna Noffke

Thanks for posting this - indeed an interesting thread and I look forward to reading your entries on the topic.

Eric Ross Gilliatt

Well stated and accurate. I have encountered several of all three over the last couple of years here on S32. Guys like Jason Marino, and always demand and perform due diligence and proof of previous legitimate and successful projects.

Patricia Poulos

Gosh! - Thanks everyone! What a wealth of knowledge of experience. So glad to be on this site.

Patricia Poulos

Vassilis, thank you for taking the time. Read 2 before 1 - most informative.

Ryan McCoy

What the hell is going on here???

Lauran Childs

Thank you, I’m looking forward to reading this too.

Other topics in Financing / Crowdfunding:

register for stage 32 Register / Log In