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  • Kickstarter: Financing Website

    Kickstarter has emerged as a legitimate option for financing independent films, where a six-figure project is on the low end.

    Upstart: Gamechangers

    The financing website helps indie and first-time filmmakers crowdsource six-figure sums.

    Steve Taylor’s first feature, The Second Chance, was a drama about an encounter between two pastors. It cost $1.2 million to make, was sold to Sony Pictures (SNE) for $1.5 million in 2006, took in a respectable $500,000 at the box office, and had a profitable afterlife on DVD. Taylor figured his next project, an adaptation of Christian writer Donald Miller’s best-selling memoir, Blue Like Jazz, would be an easy sell. He spent four years pitching investors, and by last September thought he’d locked up financing. “We had a guy in Seattle who was going to come in for $250,000 and then another guy in L.A. who was going to come in for $250,000,” Taylor says. On the eve of preproduction, the California investor dropped out, and Taylor considered the project dead.

    When Miller broke the news on his personal blog, two fans in Tennessee stepped forward offering to raise the needed funds on the website Kickstarter. Founded in 2009, Kickstarter is an online fundraising platform for creative projects. Musicians, designers, filmmakers, and other artists craft a short pitch, usually a video, post it on the site, and set a fundraising target and a time frame. Contributors are more like donors than investors, since they earn no return or equity, though they are promised rewards (a copy of the CD, dinner with the artist). If the project meets its goal, Kickstarter, a for-profit company, takes a 5 percent cut and the creator gets the rest. If it falls short, no money changes hands.

    Kickstarter has emerged as a legitimate option for financing independent films, where a six-figure project is on the low end. So far, the company has raised more than $21 million from nearly 240,000 backers for 2,443 films, according to co-founder Yancey Strickler. He says six films have crossed the $100,000 mark. That’s a departure from most projects pitched on the site, which are pretty small-time—a cartoonist looking for $2,000 to publish a book or a band that needs to rent studio time.

    In January, first-time director Jocelyn Towne, an actor in Los Angeles, raised $111,965, based largely on the strength of a clever 4-minute pitch for her film I Am I, a drama about a woman and her long-lost father. “When I first pressed the button to get this all started, I was like, who knows?” says Towne. “It was a complete shock, especially since we personally knew only about 20 percent of our contributors.” Strickler says backers tend to come from the extended network of friends of friends, but there are some 85,000 repeat contributors on the site.

    Katie Aselton and her husband, Mark Duplass, are currently raising $20,000 to rent a state-of-the-art Arri Alexa digital camera to shoot Aselton’s next film, Black Rock. The two are not rookies. Aselton directed The Freebie; Duplass, with his brother, Jay, made Cyrus, a comedy starring John C. Reilly, Jonah Hill, and Marisa Tomei. Black Rock, a thriller set in Maine, will star Kate Bosworth of Superman Returns. Aselton and Duplass are funding the movie out of their own pockets. Aselton says that as soon as they considered using the Alexa, which can shoot in almost any light, “we thought maybe we’ll just go to Kickstarter” to pay for it. For a pledge of $500 or more, Aselton will send you two Maine lobsters and call to advise you while you cook them.

    Read More:

    http://www.businessweek.com/magazine/content/11_23/b4231052825865.htm

    Upstart: Business and Management for 20-40 Year Old Professionals

    Filed Under: Gamechangers

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