A Brief Personal History
As a young film student learning all about the creative and technical aspects of film production I understood the importance of the business side of film. After all, without finance the film can’t get made, and without marketing and distribution, the film won’t be seen.
So, as my four years at a university were coming to an end, I was determined to immerse myself into the business side – specifically distribution.
My first job after graduating was with an independent theatrical distribution company as an acquisitions executive. This was a company responsible for putting Uwe Boll and Michael Madsen gems onto the big screen… you’re welcome.
The company ended up crumbling due to unstable leadership (aka a madman driving the ship), but despite the emotional toil that I endured at that position, I ended up learning a lot and making some valuable connections.
Those connections eventually led to a position as an executive in acquisitions and fulfillment with a much more reputable (though still young) international sales agency.
Once again, I learned a lot about the business in these positions and was able to accomplish my ultimate goal of gaining insight, connections, and knowledge of the film business that would become invaluable to me down the road.
I mention all of this to essentially give a little context to my opinions to come…
Steeped in Tradition
One thing is overwhelmingly clear about the entire sales and distribution business within the film industry – many of the practices still in place today are antiquated.
The business thrives on these analogue exchanges, in-person meetings, expensive trips to markets with booths, paper handouts, DVD screeners, and private theater screenings.
Much of it, I would argue, is still in place as a lifestyle perk to those who chose this profession. After all, who would want to give up annual trips to Cannes, Berlin, Toronto, Santa Monica, and so on?
Why would someone give in to the convenience of a digital screener to watch at home when one can be treated like a VIP at a private theater with all the amenities?
Despite the film industry’s natural place in technological advancement on the production side – the business side is still highballs and hand shakes.
And while it may seem glamorous (and yeah, it kind of is), it does make one wonder how an independent filmmaker fits into the picture.
Problems for Indies
There are a few problems with the current system that I see for independent filmmakers making movies under a couple million dollars.
Not Checking the Boxes
This problem is not new, and it has always been an obstacle for indie filmmakers.
It’s well known that there are certain boxes that distributors are looking to be checked:
Some indie films are able to check off all of these boxes. Those aren’t the ones I’m talking about, because those indie films are well funded and can play within the standard ecosystem of film distribution.
I’m talking about the ones that don’t check all of these boxes.
From my experience, movies budgeted under $500,000 typically only check one or two of these boxes (maybe) and that is the genre box and the “professional post & deliverables” box.
I can already hear some people yelling from the back – “whoa! I’ve heard of movies being made for under $500,000 with name talent…”
Okay, yes, there are outliers, but more importantly I think the idea of “name talent” is often misunderstood.
Let’s do some myth busting.
The term “name talent” does NOT refer to everyone you’ve seen in movies and TV who you consider to be recognizable.
That is an unfortunate myth that a lot of filmmakers fall into trouble with.
The idea of “name talent” refers to a level of marketability of an actor. Meaning, in order for a talent to be considered “name talent” there needs to be a substantial group of people who will go see a movie specifically because that actor is in it.
That’s not to say that “name talent” equals “A-list talent” – another common misconception.
There’s a spectrum of people considered to be names, the majority of which are not considered A-list, because that list is very small.
So, point being, just because you got an actor who plays a main role in an ensemble television series, doesn’t mean that actor is “name talent” in the eyes of a distributor.
Recognizability does not equal “star power”.
Specific Genres of Interest
Another unfortunate misconception is that the genres of interest never change.
While there are some that have stood the test of time, it’s important to understand the concept of sub-genres.
Everyone knows that, generally speaking, horror is a well received genre for independent filmmakers. There are a lot of reasons for this that I won’t go into here.
But, not every sub-genre of horror is made equal.
For example, at the time of writing, “haunted house” horror films are not what distributors want (unless it’s affiliated with an already existing and popular franchise).
The same goes for “found footage” horror films. Both of these are considered to be overplayed at the moment, as the market was flooded with them due to the success of the Paranormal Activity and Conjouring franchses.
Other genres that aren’t as solid as horror come and go. Right now, human interest dramas based on true stories might be a good way to go whereas other years those would have fallen flat on an independent level.
If you are going to play within the traditional realm of film distribution, it’s a good idea to gain some connections and relationships with companies in the space so you can keep abreast of these changes.
Post-Production and Deliverables
I was shocked to find out that even films made for multiple millions of dollars didn’t have this one down…
The idea of “professional” post-production means that it was done by a post house or individual who is familiar with the specific requirements for distribution on various outlets.
Here is an example of a common occurrence:
A filmmaker submits his/her film to a sales agent, who likes the film and agrees to take it on. They sign a contract and everyone is happy.
Then, once the film is sold to a distributor in a territory, the film must pass what is called QC – quality control – where it undergoes specific testing to make sure that it conforms to the standard theatrical, broadcast, and/or streaming requirements.
The sales agent receives a flag on the film saying that there is a substantial amount of sound design missing. (Did you know that there must be NO moments of silence without sound design and music?)
This news means that the film is undeliverable without fixing the problem. Which usually means that the filmmaker must come up with more money out of his/her pocket in order to make the film conform to the standards and get it released.
You can see how this becomes a problem for everyone involved. The filmmaker has already signed a contract, the agent has put money into marketing the film to distributors, and there are issues that need to be fixed that continue to move the goal post away from profitability for the filmmakers.
Take a look at a standard deliverables list prior to starting production on your film. There are a lot of requirements that often require professional services, and there are a lot of standards built within those requirements that may not be apparent until it’s too late.
Every single independent movie that came across my desk at these companies had the same problem with marketing materials – they didn’t have any.
It’s understandable to want to put the entire budget of a film “on screen” as they say, but it’s important to understand that without marketing materials your film will not even make it to a sales agent.
Trailers cut by the filmmaker or the film’s editor are likely not going to cut it – pun intended.
Trailers are a specific beast that most narrative editors don’t fully understand. The difference between a trailer cut by a professional who specializes in the medium and one who does not is vast. And the trailer not only gets the audiences jazzed about your movie, it gets agents and distributors jazzed. So why wouldn’t you set aside some money for that?
Well, for most indie films, money is in short supply, so they were doomed in this regard from the beginning.
If you take this previous statement and substitute “key art” for “trailer” the sentiment is exactly the same.
Having a good poster image is crucial. But let’s wrap this up, shall we?
Without checking the boxes listed above, a film is destined to get swallowed up (if it gets represented at all).
Movies that don’t check the boxes are considered a big risk for sales agents and filmmakers don’t understand that by trying to shoehorn their film into the traditional ecosystem, they are simply loose change in the couch cushions of the industry.
Here’s an all-too-common scenario:
A low budget indie film is submitted to a sales agent. The sales agent likes the film because it is of a certain quality and decides to take it on, despite it not having any name talent, marketing materials, or deliverables. The filmmaker and sales agent sign a contract and everyone is happy.
But, what the filmmaker didn’t realize is that there’s a “market cap” included into the contract that states the sales agent will receive 100% of revenue from the film until the cap amount is reached. This cap can be anywhere between $20,000 – $50,000 typically and is put in place to cover the expenses of going to market (booths, posters, handouts, hotel rooms, airfare, food, etc.)
The film is already not desirable to most distributors so the sales agent is forced to “bundle” the film with other films that check more boxes and the fee is split amongst the films appropriately. (This usually means just a couple thousand dollars get allocated to the film for each territory that is sold.)
The sales agent does this for several territories and is able to make ten, fifteen, twenty thousand dollars that the agent keeps as part of the market cap, and the filmmaker never sees a penny.
If you drive into Hollywood and throw a rock, I bet it’ll hit a filmmaker who has gone through this exact experience.
These small films help pay for the overhead of the sales agency but never actually produce much, if any, revenue for the filmmakers and their investors.
But, without this market cap, there’s really no incentive for the sales agent to take a film on unless they have some reason to believe that it will become a breakaway hit.
This Leads Us To Self-Distribution
The current options available for self-distribution of a feature film are bleak, at best. But technology is finally catching up to the needs of filmmakers.
Lack of Options
In the past, a filmmaker who wanted to self-distribute had limited options. Either, he/she could do a “print-on-demand” DVD route that allowed them to sell DVDs online and earn a margin based on the platform’s cost of goods to produce and ship the DVD.
This was the best option for a long time, because the alternative was to essentially allow people to download an unsecured version of your film as a playable video file on a computer. Not great for security. Not great for user experience.
Then streaming came along. It became possible to get your movie on major platforms like iTunes, Hulu, Amazon, and even maybe Netflix through the use of a service called an “aggregator”. This service cost money, and once your film was up on the platform you had no control over placement, how your film was found, or how your film was sold.
Amazon came into the mix and eliminated the step for an aggregator for filmmakers who wanted to put their project on the platform, but the monetization option was a CPM model (aka Cost Per Million). This model awarded a certain amount of revenue based on the number of people that watched your film relative to the other films on the platform. Needless to say, this option doesn’t make for much money to most indie films self-distributed on the platform.
Lack of Data
Another big jab to the nose of filmmakers is the lack of data that is earned from these platforms.
Filmmakers are generally left in the dark in terms of both analytics and customer data. This means that they have no way of knowing whether the customers who purchased or viewed their movie came from their marketing efforts or an organic view from the platform.
Filmmakers have no ownership of the customer data their film generates, to they can’t re-market to them in the future or take advantage of their own audience that has been generated through these platforms.
They also have very limited options in terms of auditing the platform to make sure the numbers are correct and there’s no funny business going on.
Lack of Control
One of the most devastating problems with all of these options for filmmakers is the lack of control.
Filmmakers are out making product and trying to build a career or a business around these products, but no matter what the distribution avenue, the only real option is for filmmakers to hand their product over to someone or something else and hope for the best.
I personally dislike this tremendously.
If I want to build a business, I want to have control over the trajectory of that business and not be bridled by the whims of an executive or a changing algorithm of a massive platform.
This means, I want to control the marketing of my film. I want to control the way my film is sold. And I want to control how my film is viewed.
Not only that, I want the analytics & customer data mentioned above to further expand upon my ability to create a business out of my art, passion, and products.
A Potential Solution
This is a problem that I’ve been aware of since my days at the university. It’s the reason I went into distribution, and the reason I got out. Ever since then, it’s been a puzzle that has floated around in the back of my mind. (One of many puzzles with this crazy industry)
Here’s what I’ve come up with…
I’ve always been the type of person to say that if something needed doesn’t exist, make it!
Easier said than done, most of the time.
But, taking into account all the problems mentioned above, here is the solution that I’ve come up with.
It’s not perfect, but if you have a better idea, I’m all ears! Hit us with it in the comments below.
Tools for Business
One of the biggest things that this idea provides is tools for filmmakers to create businesses.
Specifically, I’m talking about tools for filmmakers to build audiences, make sales, and exhibit their movies.
This is one of those things that I think all filmmakers should do, even when they don’t have a finished film yet.
Find out who your audience is and where they hang out online. Then, convert them into your audience by providing them with something of interest in exchange for their email address. This is what’s called “list building”.
When it comes to building business online (or offline), this is considered to be a foundational idea. Build a list of people who like you and what you do/say/stand for and then cultivate a relationship with them that can eventually turn into a producer – consumer relationship.
Large corporations bypass this concept with advertising dollars. Studios don’t need email lists of millions of potential customers because they are willing to spend $40-100 million on advertising campaigns that gets their product in front of the potential audiences.
I’m not against this idea, I just don’t think it’s as realistic for smaller individuals or companies.
Filmshake provides the tools for filmmakers to create websites with landing pages to collect email leads and build their list. They can do this by providing something of interest for the lead to download in exchange for an email address or they can do this by creating a “membership” experience similar to Patreon where they offer exclusive content to members who sign up for free (or paid).
Sales is an aspect of the industry some filmmakers would rather leave to the professionals. As we discussed earlier, there are significant downsides to doing just that.
For people like me who want the power to create profit from my own projects, sales is of great importance.
Having control of the sales process can make all the difference int he world. Let’s take these two scenarios as examples:
All of this may sound daunting, and yes, there’s a learning curve. But the beauty of this is once understood and implemented, it creates systems that are measurable and repeatable.
This can help for the profitability of current projects, of course, but it can also help with fundraising efforts for future projects.
Imagine being able to tell your potential investors exactly how their money is going to be made back, with data and reports from previous campaigns to prove it.
Repeatability is a key to creating a business around your movies.
The previous problems with exhibition options available for self-distribution have to do with unfamiliarity.
Asking your customers to download a movie to their computer or view it as an embedded video on your site is less than ideal.
Many consumers of film & TV have made the switch to OTT devices such as Roku, AppleTV, and Amazon Fire TV. Having your films play on these devices is essential.
With Filmshake, we are moving to allow filmmakers to sell their projects on their own website but exhibit their films on these familiar devices through the Filmshake apps.
An added bonus to this is a level of transparency between the platform and the filmmaker. Learning how a projects is performing organically can give valuable insight into what’s working and what’s not.
The main benefit to self-distribution has always been the opportunity to keep a larger portion of the profitability pie by taking middle men out of the equation.
Filmshake is no different, and our ultimate vision is to give filmmakers a previously unheard of deal – 100% of the revenue generated through their own sales on their website.
Because the movies will ultimately live on the Filmshake platform, this opens up the possibility for organic sales from existing customers of other films. From this organic revenue, Filmshake will only take 10%, leaving the filmmaker with 90% of their revenue.
We think that this will be the most fair option and start a revolution in the independent filmmaking scene that will call for higher standards in favor of the filmmakers.
How Do We Make This Happen?
We believe that we can make this dream a reality.
In fact, we’ve already taken the first steps to do so. But, before we continue too far down this rabbit hole, we want to make sure that other people feel the same way and are onboard with our vision.
If you like what I’m saying and want to show your support for the project, click here to go to the Filmshake website and sign up for the waiting list. Then share it with other fearless filmmakers and let’s see if there’s enough interest to launch this thing.
Have additional thoughts? Share them in the comments below!