Shane Stanley, Filmmaker/Author/Instructor: Everybody who's ever invested in me has
told me no. Everybody. Nobody has rolled over and said “Absolutely,
let's do it.” It's always come from people who have said no.
Film Courage: If a filmmaker's going to raise money and we should just probably pick some
ballpark figure so maybe $500,000? How can a filmmaker mitigate risk?
Shane: I think when when putting together a half a million dollar budget the best way to mitigate
risk on that is to think about genre think about star power as I as I try to tell a lot
of producers if you if you're only thinking about what the public perception is of your
work and the stars that you are working with is your end game you're not never going to be happy
be smart in your casting just because somebody is not a-list studio powerhouse player today doesn't
mean they weren't 5-10 years ago doesn't mean somebody isn't on three television series that are
syndicating around the globe two or three times a day in 140 different countries those actors
are gold and they're not expensive so when when we when we cast our films it's about familiar faces
it's about people with good reputation people that we enjoy being with 18 hours a day anyway right
but I think from mitigating risk it's about it's about getting actors that people recognize
and people can say oh I remember this actor from that series or this series or that show
or that film and it's when you're working in a half a million dollars it's really not a lot of
money it goes fast and to be able to put maybe 35 40 of that above the line I think is is smart and
then you you got your your crew and all below the line make sure that's an efficient team
that makes your product look and sound good get good editors do whatever you have to do to make
the product look as good as it can I mean you can make that that money go a long way if how to do it
but again it comes down to content a five hundred thousand dollar drama without the right cast is
not the same thing as a 300 000 action film with just one or two right people in it I mean there
they can be completely different success so I always think it goes back to really understanding
globally what your product how how products of that budget and that level and similar cast do
it's really important to look at like films I mean as filmmakers again it goes back to
thinking everything we do is so special we're going to knock the world on its
behind because this is just the best script ever and it's going to be the best movie ever
I always say always go in under promise over deliver and I think that's the biggest problem
with a lot of the pitch decks that we look at that come through everybody's got names
and faces on these things they're never going to acquire and they comp it to films they're
not even ever going to come close to comping with they always pick the big grand slam films
and and what I try to teach producers is that when you go in with all these promises and hype
you're going to start casting your film and you're going to have two strikes against you when your
your investor says well who's in it and you didn't get the names of the faces that were in your pitch
deck and I think that a lot of people go in such high expectations and they get reality check sure
you're going to get the occasional like wow I can't believe we got this person or that person
but when when you're pitching to investors I always say let's just remember the investors are
smarter than we are we're going to them for money because they are successful at doing things and
it's very similar to real estate if somebody came to you and said I want you to put 500 grand into
this housing project and within 16 months you're going to make 20 million dollars you probably
wouldn't invest especially with an accredited builder developer or somebody that and see the
track record that okay their half million dollars turns into 20 million within a year and a half and
a lot of filmmakers go in with that kind of pomp and circumstance what I like to do when I pitch
investors is I use films that most people haven't heard of is comps where I say hey this film was
made for 500 grand it made back 3 million this film was made for 600 grand it made back 7 million
because I'm not going to compare it to Blair Witch I'm not going to compare it to Napoleon Dynamite
that stuff's all lightning in a bottle and and good on them there's nothing no ding against
them it's just that's reality and investors sniff that bull a mile away I think the most important
thing when you're pitching people for money is is you go and you make the film as low as you can
because the first thing an investor always wants to know is how much money are you getting paid
we talked about that in some of our earlier interviews I think how much do you pay yourself or
what shouldn't it what should you be paid and the old saying is the the producer is always the first
one to buy lunch and the last to get paid right I think investors like to see you're not lining your
pockets they want to know you have certain skin in the game and when you go to them and you say look
you're $500,000 investment if we place it here here and here with this star power could generate
two to five million dollars over the next three to five years all of a sudden they don't feel they're
getting a snow job and that's that's the reality of our business and that's if you're doing well
so I think what's really important is it's you ask about finding the sweet spot on budget I
think it's about I think you always have to put your investor first because a lot of people just
want to get one movie made and they figure they're going to move on to the next and where we've been
very successful is having a track record with with investors we don't do one-off investors we
work with the same people over and over again and that comes from trust it comes from delivering it
comes from putting a product on the screen that they could be proud of when it's done
and and having success globally and it takes time nothing happens like that and and that's I think
the problem is is all these pitch decks that come in are just lined with bull and fluff and hype
and I think if people just take a step back and kind of do a reality check and what they're
presenting I think they'd be a lot more successful in getting funds it's just about honesty and
integrity and you said also not just the images and in the pitch text but also shooting something
like a scene that goes so much further than I look at some of these POCS [Proof of Concept] that
people shoot and they just look they look so good I I've never been impressed with the pitch deck
and it's just littered it's littered with garbage. I just got sent a 60-page pitch deck
that I'm consulting a producer on next week he sent it to me
I shot holes in 95 of it and they spent a lot of money getting this pitch deck made it is useless
and it's really unfortunate because I see it all the time and it's not that I have all the answers
I've raised a lot of money from private equity that's what I do I know when they know they're
getting garbage and I know what not to do and these pitch decks are just constantly just just
filled with so much information it's paperweight that they don't need less I'm a big I'm a big
proponent of less is more in the room I talk about it in the book uh the first time I ever raised
private equity I went into a very successful businessman's office got took three months to get
the meeting I brought in a briefcase filled with scripts budgets we didn't have the term pitch deck
back then but head shots and what we're gonna do and all the projections and the ask and takes from
the distributors and all the people that wanted to sign on and I literally I literally broke out this
this Kinkos box if you guys remember what that is Kinko's I think it's Fedex printers now I broke
out a box and a guy said stop what are you giving me I said oh I have a script I have a budget he
said look around my office and cornered a corner of his grand office there was stacks of paper
knee to hip high all over the place there's just paper and he said these are all proposals from
people that want money from me he said you want to end up in a pile give me your paperwork why don't
we just sit here and have a conversation you tell me what it is you want to do how much money you
need how long is it going to take for me to start seeing a return what are you going to do with it
and we were able to have a conversation bang bang bang and that's that's how our
our funding comes it's not with pitch decks it's not with reels it's not with anything other than
just eye contact and honesty and integrity most of our outlines when we when we meet with investors
is three to five pages tops they're really small and it's just it's just facts here you go
so then where where is the idea of of these elaborate pitch decks come from
oh I think it's brilliant I think somebody came up with the idea that they make a lot of money
getting them from filmmakers to build a pitch deck I don't know and I'm sure they work I know there
are platforms that do seminars on pitch decks and I'm sure they work for people I'm not saying they
don't work for everybody I just know that I see my share of them because a lot of people send them in
and say hey will you give me your thoughts on this pitch deck and they are just loaded with garbage
and I really believe less is more it's two plus two's got to equal four in an investor's mind
a lot of people that you go to for money have been pitched everything
and they they pay business managers and accountants a lot of money to protect them
and they're all told the same thing don't invest in the music industry the film industry nightclubs
or restaurants right that's like the first thing when you get money you're told what not to do
so you already go in with a strike against you when you meet with an investor and they've seen it
all they've heard it all and they know that they have the ability to make your dreams come true by
just saying the three-letter word yes and I think speaking too much in the room is wrong I think
even a fool is considered wise when they're quiet wait for questions to be asked stay on point
don't over analyze everything I've seen more deals get killed in a room because a potential investor
will ask a question and there's a 30-minute answer I know I'm long-winded that's my nature but
in the room it's a whole different ball game yes no if they ask for something you tell them
how it's going to be and you shut your mouth and people ruin their own deals time and time again
with too much information and as I talk about in the book don't be afraid to say I don't know
one of the greatest most fruitful relationships I ever had with a with an investor came from saying
I don't know he asked me a question I didn't know the answer and I said sir I don't know but I'll
find out for you and what that did is allowed me an excuse to contact them again in a day or two
with the answer to the question they wanted to know and I called them back I got them through
their secretary he got on the phone he said yeah what do you want and I said look really enjoyed
our time together a couple days ago you asked me a question I didn't have the answer and he
said I did I said yeah I told him this was your question this is the answer he said I got to tell
you something after you left my attorney and I we enjoyed our meeting with you we made fun of you in
some respect but at your expense that happens we make fun of everybody who comes in and tap dances
for money he said but we we were really moved by the fact that you said you didn't know the answer
to something because it showed us that you're willing to say you don't know you were willing
to be honest enough not to talks your way out of it and you took the time to find out he said well
listen I appreciate the information I'm going to let right now I'm just going to say yes to your
proposal let's move forward and do it that wound up being like a financial relationship that went
on for for I don't know how many films and how many years and that's that was birthed out of just
saying I don't know so when it comes to trying to raise private equity it's important to remember
these people are smarter than you and they've heard it all and and I they they can usually
smell right through the bull they cut to the chase with them they know why you're there
but when they said they made fun of you did they tell you what some of the things were like oh
eventually they did well you get nervous when you're you're tap dancing for for your next
meal you sometimes you tremble sometimes you say things wrong I think I spilled water on their
coffee table not anything but they gave me a glass of water and I think I was reaching for something
and I spilled and it was I was nervous it's like my first it was my first attempt at getting
capital I was scared it seems forgivable but yeah okay yeah it was funny to them
I guess so let's see the the indie guy squirm yeah oh my god and what's funny is
what happens I'll tell you I'll tell you something we talk about money I've had investors call back
when they don't always say yes and they said why do you need so much money people are making
movies on a dime now it seems it doesn't seem like you're blowing stuff up you're not hanging
off the Empire State Building why do you need so much money investors are getting more and more
savvy about what things really cost they become very wise to it there's just so much information
at their fingertips now the people that they surround themselves with they they are paid to
investigate and know what things really cost the days of going into people and asking for millions
of dollars or getting further and further I mean there are those rare exceptions but
I think you also have to be really savvy on on an investor's ability keep in mind what just
because somebody's rich doesn't mean they can just roll over and write you millions of dollars in
checks you don't know what their overhead is their exposure is what other responsibilities they have
what tax needs they have or have to avoid so I think it's really important to if somebody is
is introducing you to somebody that is a potential investor you need to do your research if somebody
is saying I want to I want to introduce you to somebody they could be a potential investor
take the time to say what do they do what is their family size what are they they got houses all over
the world are they they live a modest lifestyle are they flashy find out research them google's a
wonderful thing find out some of the things that have happened in their life their successes and
their failures make sure they haven't had family tragedies that is your project may remind them of
and I'm a firm believer whenever you go into the room to pitch somebody whether it's an independent
financier or it's a studio always have two or three projects under your belt
or under your your arm because you may say something and start down the road of a
project and they can say yeah no no no we're not interested we don't want to make film like that
or we're not interested we develop something like that it didn't work you wait two or three months
to get a meeting with somebody and they tell you in the first two sentences of your pitch
this isn't going to work for them that meeting is either over or you can say okay respectfully
understood put it away pull out another project so if they're accountants let's suppose these are
not quote-unquote film people these usually are okay so so they're people that have made money
in other industries and their accountants or business managers to tell them stay away from
the following things which include making a film why do you think they would even say yes
well I think there are people that haven't been told that or if they have they're still open to it
I will be I would say that most of the people that I have been fortunate enough to do business with
have said to me early in a relationship don't ever ask me to fund a film I would never do that
and you look at it you say well okay but people who are doing films are doing very well
if they're if they're done properly and the model is done and the budget's safe and the output
justifies the investment and there's also so many incentives to investors that they're
not even aware of whether it's the write-offs that they can get and again I always say talk
to your accountant every situation is different everybody's tax situation is different every state
has different laws and there's different things that need to be considered but there have been
bills put into place like the jobs act that'll and bless an investor for investing in a film
there are also investors that have companies that if you can justifiably involve that company that
they own in the advertisement aspect that they can actually get that film's investment written
off as an advertisement expense and it can do that long-term depreciation I've even had investors say
to me don't don't pay us any money back right now we're taking a hit on this for a while
for the company you got to slow the roll on some of these returns I mean that does happen
everybody's situation is different but there's the reality of when people make
big money and a lot of things are accessible on what people make or how successful they are
I always say cut those numbers in half they're all fabricated or they're pre-tax dollars and
people have people at that level are pretty responsible usually especially if they've been
around a long time and they come from older money that they didn't just make it yesterday
uh by picking magic six numbers you really have to go in and just because somebody's worth
a hundred million dollars it doesn't mean you ask for 10 or doesn't mean you ask for one why don't
you start small and gain their trust have a base hit or a double and then they can go back and say
what else do you want to do and so we'll have this other project we'd like to do the budget's
a little higher than last time and if you've had success you're not going to have an issue with it
I've learned some from some people that are very close to me that have had a lot of success that
they're successful because of what they say yes and no to smart people in development or in real
estate they'll make they'll make a move on a piece of property and they look at it and say can I make
3x on this in 24 to 32 months and if the answer is no they don't buy the property so as a filmmaker
you can't guarantee that so what is your pitch going to be what is your angle going to be and
that's how a lot of savvy investors think and then it goes back to the garbage and the fluff on
a pitch deck trying to appeal to that mindset and nine times out of nine you're not going to fulfill
those promises so you have to be very careful in your presentation some of our investors said look
I know you don't want to hear this you come off a 30 million dollar studio film you you can do
something with a hundred grand show what you do with a hundred grand that makes sense we'll move
on we'll get bigger and bigger sometimes you gotta come back and say look with that hundred grand
you're not going to have the success you're going to hope to see because with that money you're
offering we can't get the star that's going to move this over the hump so can you come up to 150
give me another 50 grand so I can get this actor or that actor and I'll show you what I can do
for the 100 plus the talent side and then we can have a conversation and often they'll say oh okay
I understand how that works now and they'll start working with you on that you've got to be open and
fluid and those doors should never be closed I've had everybody who's ever invested in me has told
me no everybody I nobody has rolled over and said absolutely let's do it's always come from people
who have said no right as the first absolutely even even the gentleman who financed my first film
wasn't the first time I've come to him for money yeah it took five years to get them to do it so
it did yeah it's always been those everybody I've everybody I've been blessed enough to be backed by
has started with with seasons of nos or just don't don't come to me for film I don't want to do it.
What are your thoughts on this?