Ever since we published our first Reader Q&A edition on January 17, I’ve received a flurry of insightful questions from our readers. Thus, today I’ve wrangled three more bionic questions to answer. Like before, I chose these questions because their answers will benefit the greatest amount of independent filmmakers. So, further ado, let’s dive into episode three of the Going Bionic reader Q&A session.
Question #1: Do strong female protagonists do okay for pre-sales or is there truth to a rumor we have heard that the lead (protagonist) must be male in order to get foreign pre-sales?
Answer: Although the following is sad to report, unless you’ve got Angelina Jolie kicking-a*s in a $150 million dollar budgeted action picture with more explosions than dialogue, female actors are very difficult to secure foreign pre-sales against. Then again, these days, male actors are also having difficulty justifying pre-sales. This is because the value of all actors has depleted severely over the past few years. However, if you were banking on foreign pre-sales to bring in a portion of your budget, then it’d be smart to base those sales the male actors you have attached, not the female actors.
Question #2: I keep hearing that foreign pre-sales are a viable way to finance independent films, since the majority of the box office is made overseas nowadays. Is that true?
While it’s true that the majority of the worldwide box office is now made outside of North America, and that foreign pre-sales are a viable way to finance feature films, it’s not even remotely true that pre-sales are a useful way to finance indie films. Pre-sales, by nature, are meant to attract worldwide buyers to major studio releases; many of which are sequels and highly anticipated adaptations. Simply put, buyers only want to pay for something in advance if they’re positive that a massive amount of moviegoers in their country will flock to the theaters to see the film when it comes out. Since independent films can’t give buyers such assurances or assumptions, any pre-sales offered to independent films are so small, that most of the time it doesn’t make sense for the filmmaker to accept the offer.
Pre-sales are not as easy (or smart) as they look, because the foreign distributor will not give you anywhere near the full amount due to you up front. Most buyers will only give you 5% to 15% of the total price as an advance, with the rest due upon the completion and final delivery of the film. This financial payout arrangement causes another problem, because the financial credibility of the company giving you the pre-sale will directly affect your ability to finance the film.
What I mean by the above statement is that since your buyer is only paying you a small fraction of the pre-sale’s total value up front, you’ll need to take his or her contract to a bank, investor or third party financier, and get them to give you a loan for the money promised to you through the pre-sale. However, if your lender is not comfortable with your pre-sale company’s financial ability to pay out the rest due, then they will not lend you the money. Financial institutions will only allow you to use your pre-sale as collateral for a loan if they approve the financials of the company giving you the pre-sale.
The other thing to remember is that pre-sale offers are based on 30% to 40% of what your film is worth. Thus, if your film is worth $100,000 in a given territory, your pre-sale offer will be between $30,000-$40,000. This is because a) the buyer is paying an advance for something that’s not completed, so he or she deserves to buy it at a discount and b) your buyer is probably going to resell your film to another buying within their territory at a higher price than what they paid you.
Thus, just make sure the terms of your pre-sales meet your film’s financial needs, because if they don’t, then you’re just giving your film away at a discounted price for no reason.
Question #3: The sales company handling my indie feature is going to start repping my film at a “pod” instead of a booth at film markets. Should I be worried? Won’t they look stupid?
Answer: Not only shouldn’t you be worried, but also you should rejoice in the fact that your sales company is being more financially responsible with their expenses. Since “booths” cost anywhere from $8,000-$50,000 per booth, per market, and “pods” cost $3,000-$5,000 per pod, per market, the expenses that your sales company can charge against your film will severely decrease if they shift from selling their titles at booths to pods. This, of course, will put money in your pocket much faster. Besides, no buyer cares if a sales company has a fancy booth with flat-screen TV’s and leather chairs. All they care about is whether or not they want to buy the films the sales company is selling.
Okay, everyone. That concludes this edition of Going Bionic. Like always, I thank you for lending me your eyes, and I look forward to borrowing them again next Tuesday!
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