Hey American Filmmakers,
I'm curious...Have you had foreign investors for your projects AND if so, how difficult is this process? I have a man in Singapore who is friends with one of my investors and he's interested in the one of my projects. I've just never had a foreign investor before. Thank you everyone1
2 people like this
That's a fantastic question, I wish I could say! Johnny K. Wu has mentioned international distributors, but not investors. I'll bump him!
1 person likes this
Thank you…This guy is looking to invest 10% of the budget. In indie world, that’s huge!
1 person likes this
Talk to an attorney.
2 people like this
Thank you. I have. Our attorney says I must create another LLC. I just wanted a second opinion. I appreciate your input.
2 people like this
Setting up an LLC is common practice for any film even if you don't have foreign investors (you don't need a lawyer for that) but a lawyer will make sure the correct international paperwork is given. Every country is different and have different ways of protecting investors/accredited investors just like here in the US.
After you sent your Preliminary Deal Terms that outlines the risk to your investor and they accept them, your lawyer will know what paperwork is needed. You're very smart having a lawyer, Congrats!
1 person likes this
JR, If you don't want his investment, I'll take it ;) All seriousness, go for it. Just make sure you comply with all SEC laws for investment if they affect you.
2 people like this
Well, we already have one LLC... And the lawyer as well as our accountant says we should have a K-company LLC. Being a small production in a small town, it's something none of us have every dealt with. That's why I'm hoping someone who has can give me their opinion...
2 people like this
First, congrats! Second, listen to your attorney and accountant - let them do it the right way, even if it costs. Investors are always investors first, "friends" second, and CYA is the only way to do it.
3 people like this
Do you mean a multi-member LLC that reports shares of partnership income and loss on Schedule K-1? If so, then foreign investors could likely be members so long as state law allows it. As some have said here too it is common to form a single-purpose LLC or partnership to produce a particular film even if the production company is also an LLC or other business organization.
2 people like this
This is what my my attorney has said...And I guess I just don't understand. It is a single purpose LLC...Does this mean I need to create another LLC? I'm the creative type...This business stuff is very confusing.
2 people like this
JR Rodriguez, I hear ya! I'm a creative and the biz stuff is difficult for me, too! That's why I took on a business partner this year, to take care of that stuff. We added him to the parent LLC, and he takes care of the taxes, other LLCs, etc. I would suggest doing this - just make sure it's someone who you trust implicitly and sees your creative visions the same way you do.
BTW, sinlge-purpose LLC simply means an LLC formed for the sole purpose of owning one specific project (the parent LLC is part owner of the single-purpose, and generally the investors are also part owners of the single-purpose).
Create a new single-purpose LLC for each project that goes into production.
1 person likes this
By the way, this link explains (in plain English) the benefits of the single-purpose llc. Hope it helps JR Rodriguez - don’t hesitate to reach out if you need more clarification: https://www.legalzoom.com/articles/why-do-film-companies-form-an-llc-for...
1 person likes this
Here’s another link JR Rodriguez. They do a good job explaining the LLC step-by-step. Again, if you feel confused by any terms immediately post here in the Lounge and someone will answer you. (Disclaimer- the link is not an endorsement for this company).
https://howtostartanllc.com/should-i-start-an-llc/film-production-business
I have an LLC...I need to know how to allow a foreign investor become part of the project...I'm guessing opening another LLC as I understand all of this. The name of the company now is Prophet Film, LLC
1 person likes this
Ok great. The links are for my benefit as well because I will need to start an LLC at some point. Here’s an article I found specifically about Foreign Investors. https://www.forbes.com/sites/andyjsemotiuk/2018/03/03/film-makers-look-t...
1 person likes this
@ChristopherWells, great info!
4 people like this
JR, your attorney should be able to answer all of these good questions related to forming an LLC to produce your film, including an LLC that has a member outside the US. As a general rule, it's always important to keep in mind that attorney-client privilege can be lost if legal matters are discussed publicly. It might not be an issue for the questions here, but it's still good to remember. Articles on the web and even forums like Stage 32 are no substitute for consulting with your lawyer. If you still can't get the answers you need, you may want to consider other counsel. You should also talk with your accountant about the tax withholding and reporting requirements of an LLC with foreign investors.
1 person likes this
Colette "ByFilms" Byfield interesting article, thank you for sharing.
Dane I think you're giving good advice.
1 person likes this
Lean how to do a due diligence. 2) Money talks and BS walks. Set a price and a date. See what happens.
Dane Johnson, a little off-topic, but I wanted to applaud you for being so straightforward and clear about your pricing for legal services for indie films (from your website). Such transparency is rare in this biz!
❤️
We Finance Independent Film Production Projects...