FILM INDEPENDENT PRESENTS ANNUAL
FILM FINANCING CONFERENCE
By Susan Royal

Film Independent held its annual Film Financing Conference during its recent 2006 Los Angeles Film Festival. Presented at the UCLA School of Theater, Film and Television, the Conference drew experienced panelists consisting of producers, financiers, distributors, sales agents, production company heads, agents, lawyers, guild representatives and other experts to provide a comprehensive overview of the current state of independent film financing.

The conference began with the Keynote Address delivered by Cathy Schulman, Academy Award-winning producer (along with Paul Haggis) of Crash. She opened with a “state of the film business” summary and moved on to a list of her tips for producing films.

Cathy Schulman’s Producing Tips:

1) Be sold on your own project and know it’s in good shape to go out. If you aren't 100 percent behind it, how will you ever convince anyone else to fund it?

2) Have a well-thought-out strategic plan for your film. The biggest mistake I see people making is they don't create a road map. You would check Mapquest before driving to an unknown address.

3) Act like a professional in all dealings with financiers, distributors, and executives. Don’t approach them as if you are an artist-outsider. Be able to discuss a viable plan for your film like a business person.

4) Keep up with the business by reading the trades. This is an international business now, so also read the international trades.

5) Remember that talent is power. Try to figure out what they can't find somewhere else and deliver it. Talent will follow the material.

6) Distinguish yourself. Make movies that matter.

7) Wear your battle scars as badges of honor. (Perhaps a reference to her battles with Robert Yari and Michael Ovitz.)

8) Be willing to do whatever it takes. Pull the all-nighter when needed.

9) Never touch a piece of paper twice; force yourself to deal with the problem now. That’s what producing is – solving problems.

10) Be collaborative and willing to listen to others.

11) If you feel really jealous of someone, praise them. You’ll feel better admiring them than being jealous of them.

12) Embrace the fact that it’s never easy to produce a film.

13) Be tactical. Do your research on someone you're targeting. Get several people putting in a good word for your project all at once. Orchestrate your target person hearing about it from six different places.

14) Get a good casting director on board. It really helps if a casting director calls the talent’s agent for you.

15) Cut out chit chat. People are busy.

16) Don’t be sloppy. All info must add up. It’s part of being professional.

After Schulman’s keynote speech, the attendees were given the choice of several different panels to attend throughout the rest of the day.

Susan Williams, a partner in the law firm Loeb & Loeb, LLP , presented “The Business of Film: Financing For Beginners.” Referring to her presentation as “Film Finance 101,” she covered the basic terminology of film finance, equity vs. debt financing, and why the LLC is the preferred legal vehicle for raising film funds.(She said it had been many years since she had seen a public offering for a single film.) She walked the audience through the process of obtaining foreign sales, completion bonds and all the other “jig-saw puzzle elements” needed for bank funding. She made it clear that her firm doesn’t get involved in raising money for filmmakers, however. “If you bring in the elements, I can help structure your deal, but I won’t help fund your movie. We don’t read scripts.” Ms. Williams said the completion bonding companies will look at your script and budget so thoroughly that it is a great way to vet your project. They will be able to tell you if your budget is off, and perhaps suggest ways to shave it.

“The Proof is in the Pitching” panel consisted of moderator Stephanie Palmer (whose company, Good in a Room, helps prepare pitchers), Michael Nozik (producer, The Motorcycle Diaries) and Barbara Boyle (Chair, UCLA Department of Film, Television and Digital Media). A number of UCLA students pitched their screenplays to the panel, while the audience watched, and the panelists critiqued the pitches – with Barbara Boyle by far being the harshest critic. The best received pitchers maintained an enthusiastic storytelling attitude while hitting the strongest points of the story and making them come alive. The weaker presenters tried to cover every event in the story and ended up boring the audience and the panel. Watching the students receive precise pointers brought home the importance of rehearsing and performing one's pitch as much as possible before attempting the real thing.

At another panel, entitled “Money Without Borders: International Financing, several experts in international financing discussed the state of independent film funding. They looked at the current international financing options – including various countries’ tax incentives. Last year the German government axed the medienfonds because most of the funds were going into U.S. productions, with little benefit to the German economy. Now the German government is considering new tax shelters — perhaps a tax rebate system such as the one recently introduced in the U.K.. (The U.S. doesn’t have a tax treaty with any other country.) Panelists cautioned against “shotgun marriages” – accepting funding just because it’s available. They advised thoroughly doing one’s homework to understand what you’re getting into.

“Finding Money at Festival and Markets” was the topic of a panel which included Paul Yi of MK Pictures in Korea. He talked about the “fourteen co-production markets, “ saying five years ago there were only two or three. At these special markets (such as IFP/ No Borders Market in New York and Cinemart in Rotterdam) filmmakers can present their in-development projects and meet film financiers. Producer’s rep Jeff Dowd, who has many years of experience to draw from, emphasized how important it is for filmmakers to be truly prepared before bringing their film to a market or festival. “The cost of admission at a Sundance or other important festival is between $20,000 to $40,000. Just the publicist is between $5,000 to $10,000. You should have planned for this in your budget. Your equity investors shouldn’t mind if this is what it takes to get distribution. You must build a rep team. You need to assemble a team of professionals and you should go to Sundance with your team of reps like it’s a military operation. Agents are great, but with the number of clients they have they don’t have time to do the heavy lifting. You need to team up.”

Lots of folks didn’t and lots of folks have failed. Said Dowd, “Film Finders lists over 6,000 films made which have received zero distribution. Even if the average budget was only $100,000 – which they weren’t – that would mean some 6 billion wasted dollars spent on films that will never be seen. Most films that fail were just shot too early, before they were ready, with the hope that whatever was wrong could be fixed in the mix. Sometimes there’s a momentum created and nobody realizes the project isn’t ready.”

So, how to avoid the same fate? Dowd says it all starts with getting the best script possible. “Write great parts and great actors will want to be in your movie. Copy the Sundance Institute process. Workshop your script like they do. It takes as much rewriting as it takes. Don’t aim for good; your script better be great. And my role is to know when it reaches excellence, and to not compromise before that. Once it’s shot, do lots of internal testing. Get 40 to 50 people in a room to screen it – two or three times – and listen to them. Please don’t become involved in what I call Film Fundamentalism. That’s when the five people making the film convince themselves that their film really works, in spite of what anybody else tells them.

At another panel, entitled “Made in USA: Domestic Incentives and How to Use Them,” the tax advantages within the US were discussed. The tax incentives currently available in New Mexico and Louisiana were primarily reviewed, because they are quite astonishing. In both New Mexico and Louisiana there are no minimum spending requirements and the credits productions receive are entirely transferable. Peter Dekom represented the State Investment Council of New Mexico and the Director of the Louisiana Film Commission, Alex J. Schott, answered questions about his state’s advantages.

How to assemble the elements needed for attracting film financing was the predominant subject of a panel entitled "Friends With Money." Some suggested a new producer team up with a more experienced producer when first starting out. Representatives from the DGA, the WGAw and SAG Indie spoke about their special programs for low budget films while attendees ate their lunches.

At the end of the day, a reception was held and the majority of people hung out for some time, networking and talking to the panelists.