Keys to Film Financing: Producing Within a Financial Framework
For our final article in the series, we'll discuss the changing realities of staying within a budget and the solutions we've found to be most effective on a variety of budgets.
Having a successful production stems from exceptional preparation. Regardless of budget (whether it's a $200,000 film or a $200,000,000 film), a project relies on its key management team to successfully prepare for principle photography. As we’ve discussed in the financing series thus far -- each piece of the puzzle (the completed film) has an economic foundation at its core. From casting, to writing, all the way to preparation, a film is made in the details of the dollar and cents management.
As creativity will ultimately drive the ideation and project formation, so too should pragmatic economic management drive the preparations. From hiring, to payroll services, to locations and vendor specifics -- the nitty gritty of filmmaking is often (if not always) tedious but a necessary element to a successful completion on the structure course that was designed for production.
The days of going over budget have all but died (yes, they still exist in the studio world and yes we still read about outlandish over budget indie films in the trades -- but as a generality this has changed) which means being on point in regards to preparation is equally important to a strong creative execution.
In the late 80s and early 90s during the high-point of the independent film boom -- coupled with the high-point of a cash rich economy -- films often times went over budget and financiers footed the bill.
Today, we see more often that producers, executives and financiers are not only expected but required to come in on budget for two primary obligations:
- Completion bond: a completion bond all but guarantees (no pun intended) that a project will be delivered as promised to the financiers. The bond company has the ability to take over the film to ensure that completion occurs accordingly. If the project spirals beyond the bond company being able to control the final delivery budget -- the bond company foots the bill, period.
- Self bonding/producer stipulations: contracts we see (on the production side of our business rather than the financial) effectively remove any doubt that the project will be delivered on budget in the sense that our producer fees and production company fees will not be taken in full until the project has been delivered on said budget. Should the project spiral out of our control and go over budget -- our fee will be lessened the amount of the overages, period.
These driving forces are two major ways in which financiers are working to control the overages that have so been prevalent so long throughout the industry.
Assuming that these practices will continue -- which we imagine they will -- a producer must be prepared for production with the mindset that every dollar needs to be well accounted for.
In late-2013 and early-2014, Buffalo 8 Productions (our full production team) was brought on to produce a feature film with an ambitious creative, as well as a tight budget and timeline.
So often in the indie space -- these are the typical elements to expect, but in this instance we were up against a travel budget (shooting outside of Los Angeles in a remote Texas location with nearly no access to housing, transportation, vendors, amenities), a tight overall budget well beneath the scope of the film (imagine making a period drama set remotely in the landscapes of Texas for next to nothing) and deliver ASAP for festival and distribution deadlines.
The production was fast tracked after a director agreement fell through -- causing the creative to shift, the budget to adjust and the casting to change course.
In doing so, we remained calm (or as calm we could be) to prepare the project with the elements we could control.
- Prep time: We were able to build in three weeks of prep in Los Angeles with our team (producers, production manager, casting director, DP, director and Art team) but would not land in Texas until three days prior to production beginning given the tight budget. We had to make it work.
- Locations: We were forced to “scout” our locations remotely via camera feeds, Google Maps, etc. and figure out a handful of useable locations prior to landing on the ground for hard prep in Texas. We had to make it work.
- Casting: We had to find a notable name talent to help carry the sales of the film (without pre-selling the title given the tight timeline) and have them work with our limited budget in the remote out-of-town location. We had to make it work.
- Logistics: We had to transport 30+ cast & crew from Los Angeles to Texas, house 40+ team members in Texas and find transportation both to and from set as well as meals on a daily basis. Not to mention finalizing our vendors, locations and background talent. We had to make it work.
- Complications: As is always the case with film production, multiple wrenches are continuously thrown into the machine. In this instance, Buffalo 8 landed another film that needed to be fast tracked into production here in Los Angeles during the exact same time frame -- which meant the team would be split up to begin prepping another project. Again, we had to make it work.
Bottom line, each of these elements were stressful, defeating and difficult to swallow as the days were long and often frustrating. Ultimately, containing the budget to the best of our ability was the key goal.
And -- in the end -- both of the films ended up being strong pieces of work that have found success as completed features:
Land of Leopold: (the Texas project) premiered at Sun Valley Film Festival and sold to HBO Europe & Continental Media for US distribitution.
Jimmy Vestvood: (the Los Angeles conflicting project) premiered at the Austin Film Festival and represented by UTA for international sales.
Realistic versus Optimistic
Whether you’re a financial wiz or the creative power behind your project -- you need to recognize the realities and difficulties of putting a film together within the framework of remaining on budget. Oftentimes, producers (and I have been guilty of this quite often in the past) will attempt to fit a square peg in a round hole regarding the production of a project. Ultimately, you will fail (as I have) as the numbers do not lie.
Attempting to be overly optimistic in regards to what you can/cannot shoot a project for will result in failure. It is better to assume that production will cost a bit more and then return the difference back to your investors after principle photography completes; nothing makes an investor happier than a bit of returned capital sooner than anticipated.
And above all -- as noted in the case study above -- managing the financial elements under duress is critical as the creative & business elements of the film depend on it.