Unexpected Pitfalls and Benefits of Crowdfunding
I just want to say for each of you one benefit and let's start with the like, uh, drawback. A personal sort of thing about crowdfunding that you're like, I wish somebody had told me it was gonna be like X. That was hard, Nathan. I mean, I know. So I knew it was gonna be hard and grueling and basically, like you said, a full time job. It's not even with a team. Somebody has to be the person waking up in the middle of night. Terrified. You're not. You're not gonna get there. You're implying that was you. That was me making me There was some sympathy terror, but I think I bore the brunt of it. Um, in terms of an unexpected negative, I don't I don't know that I have a really strong answer that Well, I think the waking what was that you were scared of in the middle of the night? I'm just curious. I mean, just stalling, you know? I mean, if you look at our graphic, the end of it, it's like, Oh, they have this, like, perfectly linear graph goes to the end, but it would be nicer to have been l...
ike way ahead of the goal. So at any point in the first few days, it's like everybody, you know, it's It's your grandma was your friends. It's like, OK, yeah, we're killing it. But you know, that tails off. And then at a certain point you get to like people I've never met. And, um, you know, I talked about this and a little You're introverted, skied to filmmaking. This, like, I don't have the personal social Network to raise this much money where if everyone I knew gave 10 blocks, we would do it. It's like people who need to find this somehow gonna do it. And you don't know if everything you've put in place is going to work That, like if the Hunger Games is like, has a great first week and then stops because that's it. No one else out there. So it's a little It's little terrifying, and you have to, like, proceed with confidence and energy, you know, like going to a ball. But it's nerve racking. Yeah, yeah. Natalie, what about you? Yep. Exactly the same. Did er incredibly nerve racking. And then, I mean, I just want to top it all off. You know, I felt probably responsible as well to talent, you know? So I was, um you know, obviously the film to work out the film. You know, if it was just me and it was just a fool, you know, I would have taken that person that I would have seen that as a personal failure, and I wasn't really looking forward to taking a hit like that. But, you know, I also knew that I was e I had kind of promised telling something. I had kind of been selling him on this idea of what we were going to do. So I felt like, Yeah, I felt that side of it was really challenging. And we did have a platter. We had the worst platter. I literally just all I want to do is to do the whole ball thing and just be like, Oh, no, it's fruit. Um uh, but I don't know, You know, there's just, you know, you there's these little things that happen to keep you pushing along and, you know, it's like that sense of duty and that sense of belief in your story, it really is a sense of belief in your story, Um, like, underneath and yours, No matter what. I knew this was this was a good story. And I feel like, you know, look what listening to Nathan talk as well, because he obviously had the confidence in his story in his script in this film. And that's I think. What the With a Z filmmakers, we we get it, we gained our confidence. It's the only place to really have a confidence because I'm not. I'm not a sort of introverted filmmaker. I do have incredible connections because I work a lot of music as well and all over the place, and I've traveled the world, and I have done these great things. So I had a network. But even with the network, it's it's still about this story. It still comes down to, like, the story, the power of the story. So that was the that was the thing that sort of kept me, kept me going, kept me, um, you know, kept me believing Give me the sort of face, uh, to keep pushing forward. Yeah, I like to say sometimes that great crowdfunding happens at the intersection of belief in your idea and the desperation to get it made. Like those things air are really important because when one fails, the other bolsters you along the way. I think you articulated that really well. So needing you just highlighted one of the ancillary benefits of crowdfunding was an equity investor came along? What? What else? Um, I mean, I think the biggest thing besides the equity stuff was understanding better who our audience is likely to be. Um I mean, we had a very specific idea of the type of people who are film might appeal to, um and it didn't radically change like it was a whole different, but, um, it's different. I mean, it is, you know, um, broader and and we learned a lot in terms of the data we didn't we audience built, but still, it's only a few 100 people contributed. So that's not that audience isn't enough to sell the movie too and make our money back. But knowing who responded to it, I think, is incredibly valuable in terms of eventually marketing and selling the film. So yet that I think it's a huge thing that I didn't really count on going into it cool, not Really? What about you? What were your ancillary benefits? A press, press press? Yeah. Tons of had a massive amount of press you a za results of the crowdfunding campaign. Yeah, ESPN got in there all sorts of people. Yeah, well, he had follow up stories as well. You know, we've got we've got a story that could have kept on going past the crowdfunding campaign After the campaign sort of raised the awareness of the story, ESPN, for example, reached out to us and they said, Can we send a journalist to spend a couple days with you while you're filming and do a feature story on the film? So So that was good. And so we've had stories come out while we've still bean making the film always entertaining. We've been editing on and off for the last year and just finally believe it or not, Still making final tweaks stood before the l A Film festival. But yeah, the story is the story kept going. So, um, I feel like, you know, the network that we built through press and the interest that was sort of generated through the campaign, um is something that we really tap into going forward, although we have different kinds of markets that we need to get into now, for from a press perspective, you know, we've got to get into the sort of very specific film market where we're going to see whether this film was gonna be, you know, a commercially viable. And then there's, um, and get the reviews, etcetera, etcetera. It's not just about, you know, supporting supporting talent and raising funds to the film takes you are gonna be, uh we need to generate the next round of persons. You know, based on with that the film was any good. Yeah. No pressure. Yeah. So do we take some questions? Yeah, because we're close to the end here. One thing that I know you touch upon, um, in the last segment and that I would like to reiterate is gratitude does drive a lot like the more you give out. And the more that you try to be like, what can I offer? What can I give that takes into? It takes like a lot of the pressure of asking all the time. It's like if you keep offering, you keep giving and movies are magical and people find them sexy, give over that thing that a lot of people don't get access to of like what we think sometimes is, the grind is sexy and powerful and can be offered. I say this about onset meals, that there's no where that take out food on a foldout table in a plastic chair is more fun and exciting than on a set if you don't have to be there. Do you mean like there really are these things that become sort of wrote for us that are really exciting for for people who don't work in the business and a really cool way to reach outside of the industry? For sure? Um, yet I mean, I know that both of you guys were very meticulous about thinking people, is it as it came along, fast as possible. If they didn't contribute at 3 a.m. We made sure that you're getting a thank you email within an hour. That's I mean meticulous and read it allows Thank you Emails. Yes, meticulous gratitude is going to be your biggest asset throughout your entire career as a filmmaker. Full stop crowdfunding distribution on set making connections, networking, showing up to offer stuff and being meticulously grateful when stuff is offered to you, I feel like is is sort of the very foundation of a lot of the really great careers that we see. Um, yeah. Are there other questions? Um, can we touch on I r. S involvement levels with crown funding, Fiscal sponsorship versus gifts. Um, also one of the proper terms to clarify the difference. Okay, So most crowdfunding sites do work with fiscal sponsors, in which case you're sort of behaving as if you're backed by a five a one c three. So it depends on the fiscal sponsor you're working with. They all have different rules, so you have to clarify it with them. Some of them will create a tax write off form for every contribution that's made. Some of them have, ah, have a minimum level at which you have to contribute for there to be a tax write off. And, to be perfectly honest, people were giving 25 bucks are not doing it because of the write off. It's usually the much higher contribution levels at which that's functional for Gift's. The upper limit, I think across platforms is $10, and that is set by the I. R s on. And, um, you know, as they're adjusting their gifting levels, I think you'll see the platforms adjusting them, but the most an individual contributor can give when you're not backed by a five a one C three especially is 10, and the I. R s treats crowdfunding, uh, for the most part, as income. But that's okay because you're going to write all your expenses, which you're gonna spend on making your movie off against it. So it usually doesn't hit your bottom line, and you need to talk to an accountant and you need to talk to an attorney. Don't make movies without talking to accountants and attorneys. They go to school for a really long time to know stuff that, like your friend who's made a movie before, just doesn't know. So, yes, get advice from your community, raise the money or spend the money talk to a professional. They're tons of attorneys out there, entertainment attorneys who will give you an hour of their time. That could be something you ask for is part of your crowdfunding campaign. But, um, don't go willy nilly into um, you know, incorporating or making an LLC. Those might not even knowing what the right structure is for the business entity of your film is something that should be consulted upon and should be influenced by what you want to do with the movie. It is not always true that a single purpose entity LLC, is the right kind of entity for your film. And if already you don't know what that means. That is why you talk to an attorney and an accountant. It's really important. The final questions. Um, Sara wants to know. I'd love to know how early you start working with seed and spark before launching that process. Sounds very important. Wow, man. Natalie, we worked together for months, right? Three months at least. Yeah, three months. So we are. As soon as you've decided to crowd fund with seed and spark, go ahead and click the launch button and and upload your information and start getting feedback from from us. Because, you know, for all you know, the feedback you'll get is like, this looks great. Way to go. Tinker this here, tinker this their reach out to these people. But you may get feedback. That's like, Wow, you need, like, a fundamental restructuring of this pitch video. And here's what we would suggest and you need the time to be able to do that. So, um, if you have a fixed launch date for some reason where you're like, you know, everyone I know is is going out of town by this date. So we need to or if you know, as most independent films go, you have, like, one window of time where everybody's schedules, lineups you need to raise your money this before you know you're working backwards from your shoot date. Try to give us a much time toe work with you as possible. But it's not just for us, right. All we're doing is trying to get you to do as much of this rigorous audience building in advance is possible. And some of that is gonna be the research phase. Some of that is gonna be the communication phase that Natalie was talking about, where you know, it was just tons and tons of communication. And then it was the jigsaw puzzle phase of now have communicated with everyone. I've done all the research about all the elements I know what everyone's schedules is. How the hell do I fit all this together? Right? So you need time to do that stuff. And you know, there's a reason that film productions get pushed all the time. It's a lot to fit together in a jigsaw puzzle, and sometimes it takes longer than you think. So you want to be pretty flexible about it. Um, and, you know, give, I think we are most effective when you are prepared for us to give, you know, pretty structured feedback about your pitch video. When you're prepared for us to give pretty structured feedback about additional research, we think you might need to dio um, that stuff is is mostly helpful to you. We don't take a lot of time. It's really about, like, how much time? In between edits of the video or whatever it will take for you. Um, and you know, that's That's part of the reason we don't do thousands of campaigns a month. You know, we do will do 20 to and it's It's partially because people come to us and, you know, they usually find they need more time to prep the campaign than they thought. Um, one thing it's really important to know about crowdfunding. It is not true that if you build it, they will come. It is not true, right? You have to do the work to let the people know that it is there. Um, so don't believe Kevin Costner's bull fit cream into butter. That's right. What does that reflect? That's from Catch me. If you can go there, you got to be that mouth you can't just float on the cream. Won't won't do itself. That's right. So we're just gonna leave you, um and goodbye and thank you all very much for listening. Take a watch of the first couple minutes of this film and then I dare you to not desperately want to follow it. You can find out over them are unseeded. Spark not no cell clean. I want you. Well, you This