Wednesday May 21
This was a no-movies day. Not because I screwed up my schedule but actually by design. Sometimes, you have to prioritize meetings, not to mention catching up on the work that’s piled up at home. Colin and I have the June Royal calendar to put to bed in the next few days and he’s been hard at work contacting distributors about titles we want to show.
Meanwhile, one of the films I’m working on, a noirish murder mystery with Peter Lynch (of Project Grizzly fame, among many other things) is at a polished enough stage to be ready to start hunting for dollars. We’ve already applied to the OMDC and have been prepped to send our stuff to Telefilm for a couple of weeks now, but their nightmarishly Kafkaesque system of signing up for the electronic submission systsem has caused a few delays.
If I’d known, for example, that they would only send me the PIN by registered mail, and that my housesitter would not be able to pick it up from the post office (because he is not me) and that even after convincing them to give me the PIN electronically (after days and days of delays) that it would still not work, because they didn’t correctly inform me about whether to sign up as an “individual” or “company” … well, let’s just say that if I’d known it was approximately 100 times more time consuming than signing up for any other online protal I’ve ever dealt with, I’d have started the process months ago, in anticipation of submitting something in May.
But who’s complaining? I’ve got my application ready, I’ve talked to someone at their office to ensure that it’s not too late to submit, and I’m doing it. From Cannes. At specific and somewhat inconvenient hours, because even though this is all online, it’s still got “hours”. Sigh.
The way Telefilm’s film fund works, for production, anyway, is that they open the doors to submissions at a certain point in the year (March-ish) and then start giving money away until the year’s allotment is depleted. So, it’s in one’s best interest to apply early, as they’re usually tapped out by June (sometimes money frees up in the fall when projects get stalled or postponed but that’s another matter). I was nervous about applying so late, but we weren’t ready before now so it’s kind of moot. And, we’ve been talking to them about our project since last fall, so they’re ready for it and have assured us it’s not too late. Fingers crossed, eh? It should be submitted completely by end of day Friday (today, as I write this).
Other than wrestling with the bureaucratic beast that is our national film agency, I did also manage to have a completely wonderful lunch with a bunch of super cool genre film ladies (three in sales, one in distribution, a couple in festivals, and one other producer), an annual thing that my mogul-in-training friend Ivy Lam has been organizing at every market for the past couple of years. It’s actually wonderful to connect with other women working not only in film but also in the very boys-club-ish niche of genre.
On the topic of “women” and all that, here’s an example of why Colin’s feminist outburst this week was so appreciated by so many. While at the lunch I heard a story from one of the festival programmer ladies about her attempt to politely reject someone’s (offensive) film and being told that he’d like “one of the male programmers” to look at it. That guy can go fuck himself.
In the evening we caught up (at Papa Nino’s yet again, it’s becoming a major habit) with two friends – the always charming Lane Kneedler of AFI Fest and one of my favourite film journalists, Drew McWeeny (a truly wonderful human, too). Movies are, of course, not to be underestimated. But the best part of having a travel-heavy festival schedule is the fact that you get to catch up with friends from far away. Because, let’s face it, I can’t actually go to London, Tallin, L.A., New York, Paris, Munich, Tokyo every year, but there are a lot of people who I love dearly in all of those cities, and it’s nice to at least see them here, in Berlin, and at TIFF (lucky me for living in one of the hubs).
After dinner, we had a drink at the Grand with an agent friend (a French expat living in L.A.) who gave both Colin and I some really inspiring career and life advice. More on that in a future blog post!
Of course, we ended up at the Petit Majestic at the end of the night. I don’t need to tell you how that ended. All I will say is, I did not drink any “Desperados” and that is, in itself, a victory.
This week, I’m focusing a lot of my time and attention on budgets. I find financing to be the most consistently confusing part of making a movie, and I definitely still don’t fully “get it”.
For two of the projects I’m working on, the budget looks like it’s going to be in the neighbourhood of $1.2 million.
If you asked me how it will be spent, I’d have to say “I’m not there yet – we only have the vague totals in mind and everyone (who’s more experienced than me) says it’s realistic, so I’m trusting the professionals until I can sit down with some kind of money person and an actual line producer (they manage the day to day operations on a shoot and keep an eye on budgets) to break it all down. Till then, I won’t have a clue about how that $1.2 million will be spent. All I know is, I ain’t getting rich off it, because if there’s one thing everyone seems to agree, it’s that a million bucks is peanuts when you’re making a movie. It’s a hard fact to wrap your head around because in almost any other life context, it’s a huge amount of money.
But anyway. Rookie musings.
Now I don’t know about you, but for me the first question that comes to mind when you’re talking about raising over a million dollars is “where the fuck are we going to find over a million dollars!?” Very slowly, I am starting to find out the answer, but boy is it convoluted.
First, there are the government funds (in Canada, at least). Telefilm Canada, the OMDC, Astral’s Harold Greenberg Fund and various others all provide funds for various phases of the filmmaking process. they all have very specific rules, regulations and requirements. For example, the OMDC will give you up to $400,000 for a feature film, but it has to be a maximum of 15% of your budget (so if the budget is $1.2M, that cap is actually more like $180,000), and they have to be “last-in”, which means you have to have raised the other 85% of your budget before they’ll enter the picture. Telefilm has a different maximum, which has to be a different percentage of your total, with different requirements about what you have in place when you come to them. I’m simplifying, but you can already see how it can easily become a real jigsaw puzzle trying to put this together.
Then there’s sales. If you get a good international sales agent on board, they can help to raise some of the money for your film, either by pre-selling the film (on the basis of something that makes it attractive to distribution companies in other countries before it’s even been made – like a big star, or a concept that’s a guaranteed crowd pleaser, or a genre that works particularly well in their country, or who knows). Basically, if your film is pre-sold, the distributor gives you an MG (a minimum guarantee) which is an advance against sales you’re likely to make in their territory. Sometimes pre-sales give you actual cash in hand to help you make the film. Other times, it’s just a guarantee of future revenue.
Then there’s tax credits. In Canada, there are all kinds of tax incentives for shooting your film here, and they vary from province to province. For every dollar you spend on labour during your film shoot in Ontario, you eventually get back something like 35%. There are rules about what expenditures are eligible, and there are all kinds of bonuses. Your percentage gets bumped up if you shoot outside of the GTA, for example. But then you have to calculate whether the amount will be worth the expense of having to travel somewhere and put everyone up in another town for weeks, instead of letting the majority of your (let’s face it, very likely Toronto based) crew just live at home during the shoot.
Tax credits can amount to hundreds of thousands of dollars, but the government could take up to a year (sometimes even longer) to get the money to you, so if you need that money to help your cashflow situation, you need to get a bank loan (or something like it) in the amount of your future tax credits, which you will then pay back when they arrive. This also means calculating bank interest into your budget. Complicated, right?
Some producers seem to feel that tax credits should be considered a cherry on top of a completed budget – not a crucial part of what you need to get the movie made. But increasingly, everyone I talk to considers tax credits to be necessary because it’s hard to put all the pieces together without counting on that extra cash.
Some companies (be they production companies, sales companies, distributors or big movie studios) have their own pools of money which they can invest into a production. One sales agent / distributor that we’ve worked with on a previous project is able to finance films fully up to about the $2M mark. Of course, the high end of that is very, very rare, and they’d much prefer that you bring them a brilliant script for $700,000. However, they’re out there, and they’re looking for projects.
Of course, figuring out who those companies are and how much money they have is a difficult task. That’s a large part of the scouting I did in Berlin and also in Cannes – meeting with people, introducing them to my slate of projects, finding out what they’re after and then figuring out whether anything I have might appeal to them. Attending markets is expensive and might not seem like the best investment if you’re broke and just trying to get a little project off the ground. But it might be the most efficient and cost effective way to get your project to the right people, actually.
Then there’s investors. If you’re incredibly lucky, or if you travel in wealthy circles and are a smooth talker, perhaps you can get a private investor on board. Investing in a film (instead of, say, the stock market) can be a wise and lucrative move for someone with lots of money, and there are lots of people out there who do it. In exchange, they get a percentage of ownership in the project and usually a credit (like, Executive Producer). They get paid back for their investment first, and if the movie makes a profit, they get a percentage of that as well.
Worst case scenario, if the film fails to make a profit (as often also happens in the stock market), at least the investor can point to a completed product that they are hopefully proud of and say “hey, I produced that”. The glamour of being “in the movie biz” is not to be underestimated. Lots of people want to be involved even if there are no big stars or even the promise of big money, because movies are cool and glamorous. It’s a myth Hollywood has been building for a hundred years, and people really buy into it. Best case, the investor makes back their money and perhaps even a bit of a profit, enjoys the process and wants to do it again.
One of the films that I’m working on is hoping to put together a budget that is 75% various government funds and 25% a producer / sales agent who can contribute financially to the film. That is, if we actually get the maximum amount that we’re technically eligible for from each of those funds, which is a huge gamble. They could easily choose to give us less, and we’d be stuck with a big gap. Plus, the deadlines for each of those funds (and the dates by which we’d hear from them about whether the project has been approved) don’t coincide very well at all with our projected schedule, so we may end up having to delay everything by a few months.
The second project is going to be 30% private investment from Canada, 25ish% from a North American distributor, 20% from Canadian government funds, 25ish% from government funds and a distributor in Germany. That is, if we can convince everyone that the terms will be favourable to them. We’ve got five partners on this one and four out of five are assuming financial risk in the situation, so they have to be very sure that they’re comfortable with the terms. Guess who’s not assuming financial risk? This guy.
See what I mean when I say it’s complicated?