Red Rock Entertainment: 3 Ways to De-risk your Film Financing Project

Even the greatest idea worth nothing without financing — this is the harsh truth every filmmaker needs to accept. And getting a project financed in such a competitive industry as the film is not that simple. Yet, the numbers demonstrate that film financing gradually grows year by year giving the hope for young filmmakers. In the past year alone, the UK invested in the film industry 12% more than the year before and hit the historical maximum on investments since 1994.

Even though the cycle of money enlarges, the competition does the same. Young filmmakers have not only created a great film with an outstanding plot and impeccable shooting but also attract investors with the financial side of the offer. Here are three main components of film financing from the investors’ point of view: the de-risking strategies. Red Rock Entertainment company experts agreed to review these strategies and clarify why and how they matter to financing professionals.

1. Why genre matters

An easily identifiable genre is a ticket to the world of distribution. Distributors love plain scripts and films with straight genres because they are much easier to sell in the market. This is why genre matters — point one.

Point two: genre matters in terms of its filling and the industry’s trends as well. For example, last year It by Andy Muschietti revived the genre of horror and brought it back to the big screens. Consequently, distributors will be looking for quality horrors in the next couple of years to satisfy the audience. Same goes for the topic trends (#MeToo movement and gender equality topics) that fill your genre. The trendier your film is, the easier it will be to get distribution for it.

Now let’s get back to investors — why they care about the genre. Read above why distributors do and do the math for the investors. The better distribution agreements a film gets, the more popular it gets in the world, the better sales it will make. As a result, the more money will come back to the investors. It’s that simple.

2. Talent and big names

The second option to de-risk a film is to use one-of-a-kind talent and big names in a film to turn it into a sensation. Furthermore, the use of big names in a film usually secures script and plot quality because those overpaid actors don’t accept just any job offer. Let’s look at the example; a team from Red Rock Entertainment reviews a script, listens to the pitch, and then evaluates the business plan offered by a young filmmaker. While everything seems to be fine, there’s still some detail missing for them to accept the financial opportunity. And then, they check the lookbook’s cast page and see Ben Kingsley, Judi Dench, or maybe even Gary Oldman listed there. Such a big name won’t leave them indifferent because if an actor or actress of this status agreed to participate in the film, then it’s definitely a worthy investment!

In the film industry, a big name almost always equals talent, yet not always. Sometimes big actors are not able to reproduce the set problem and this is where a young and extremely talented actor may make a hit! For example, back in 2008, Dev Patel got his part in the Slumdog Millionaire. The actor was a no-name at that time but his charisma and the perfect script delivered the film 8 Oscars. Not always does a film need a loud name, sometimes a talented actor or actress is just what’s missing.

3. Finances, discounts, and guarantees

The third film de-risking strategy is the possibility to apply for the UK tax-efficient programmes. Ther are two of them: The Enterprise Investment Scheme (EIS) and the Seed Enterprise Investment Scheme (SEIS). For art-related people economics may seem like a different language; however, if you want to attract investors to your film, ensure that you learn as much as possible about tax-relieving opportunities.

Why that matters? Well, the UK government supports creative industry in many ways, and by offering filmmakers EIS and SEIS, it guarantees about 30% of a tax rebate. This means that your potential investors will be able to save more money on your project and so get a better income in the end. You can read more details about EIS and SEIS on Red Rock Entertainment’s web-page and watch their videos for better clarification.

The bottom line

Film de-risking methods are a strategy that can secure your path to the world of big film. Ensure that you consider de-risking methods before stepping into investor’s office so that you can prepare your arms for the persuasion game.