As the CFO for one of the few equity funds actively financing Independent Films, it doesn’t take much for me or any other funder to tell the professionals from the amateurs.  One look at a producer’s finance plan (as well as their choice of attorney) tells me right away what kind of closing I’m in for.  Being that a film finance closing can last anywhere from 4-12 weeks, this can be a relatively clean, straight forward, experience, or 3 months of hell.  Simply put, a finance plan is the best indicator of a producer’s financial I.Q.  We need to know that you know how much money you really need and where you’re going to get it from.

You can no more produce a movie with a mediocre budget, than you can finance a movie without a finance plan.  It’s the art and science of simultaneously predicting and preemptively satisfying the needs of lenders, investors, attorneys, and bond companies.

Producers tend to think in gross numbers and percentages:

Mr. Grossman says, “Hey Jeff, I’m making a movie for $10 million and I need $2m equity; the rest will be 20% tax credits from New Mexico, we’ll pre-sell 30%, and gap the rest.”  These back-of-the-napkin numbers are fine between friends, but you will inevitably end up going back to your financier, hat in hand, to ask for more.  You don’t want to be in this situation, especially if the lender or investor has already gone to their board for the initial amount.  This is where most deals begin to die.

Because of this, funders have become much more sophisticated: they are either better at punching holes in packages, or they hire someone who is.  To inspire confidence with your investors, you don’t have to be smart enough to build your own finance model; you just have to be smart enough to surround yourself with people who can.

The following is what you’ll need to calculate: (a) What your films budget is and (b) What type of capital you’ll be using

  1. Budget information
  2. Foreign pre-sales and estimates
  3. Tax credits
  4. Sources of equity
  5. Gap calculation
  6. Financing costs
  7. Credit discounting (presales and unsold territories)
  8. Bridge details
  9. Worldwide costs of sales (sales agents, etc.)

As you can see, a well thought-out finance plan is not just a requisite for the closing, but is also an essential roadmap that will guide you through the fund raising process.  While it can allow you to play with certain variables, the market conditions will typically reveal how the film should be financed, as opposed to how you would like it to be financed.  If done properly, your roadmap will lead you to the net-to-production.  Remember, Net Net Net! Because, if it’s not net, it’s gross.


  1. Caveat: When dealing with individuals who understand the nuance of costs-of-sales and credit discounting, back-of-the-napkin numberscan function as an effective short hand. But short of that, they just cause problems down the road — and that’s where the closings crumble

    • I’ve never packaged a financial plan for a indie feature yet, I can produce one from start to finish. I have produced others projects. My career goal is to end that and produce my own, including the financial plan.

      Funny thing is, I can’t remember how many business plans I’ve written over my career. So, numbers and financials don’t scare me.

      My eyes have glazed over in the amount of articles and books I’ve read however, I do know, if I don’t actually go through the process I’ll never know. I admit I am a voracious reader.

      If you had additional insight, information or articles on the above nine bullet points, it would surely be great to study.

  2. As a novice to the industry and currently developing a startup company, how might I go about finding the right individual(s) to assist me in reviewing my current finance plans? I was considering approaching one of the university’s here in Philadelphia, perhaps a MBA finance-major with a concentration in film/entertainment industry etc. Am I on the right track here, or what is your best advice?

    John Green
    Emerging screenwriter/director/producer
    Philadelphia, PA

    • If you just need somebody to check your math, that’s one thing; if it’s more than that, then there’s no point in having somebody review a finance plan who is not actively and consistently making movies. The markets, values, and industry trends change on a weekly basis — you need somebody who is in daily contact with financiers, banks, sales companies, and so on.

  3. On finance plans it might be worth having a look at a book called ‘The International Film Business’, published in 2010. This is perhaps more from a British / European company perspective. But there are some useful lessons. I would be interested to know if there is anything on US finance plans for indi’s…

  4. This post really helped me fill the gaps I had in this subject. Been looking for something like this for ages but since this topic is so obscure, not many people are knowledgeable in it. Excellent work.

  5. You mentioned in one of your posts that banks don’t get into gap/mezz/tax credit lending on films under 10M for various reasons (which made sense when you outlined them). I’m wondering, however, if I could get a pre-sale loan on an indie film with a 1M budget. Let’s assume I already have the equity to fill whatever ‘gap’ was left over from pre-sales and tax credits.

    Let’s also assume the sales agents and buyers in this hypothetical case are solid.

    A) What, if any, are my chances of closing a pre-sale loan?
    B) How long would it typically take to close (ballpark)?
    C) What kind of discount range are we lookin’ at?


    • Films under under $5m generally don’t generate large enough pre-sale contracts that would interest a bank or other institutional lender. The fees and interest the loans generate would not be significant enough to offset the hard costs associated with generating loans. Private lenders and investors cost more than banks but have lower overhead and more leeway.
      A) Most pre-sale lenders require a completion bond, which films under $2m generally cannot obtain.
      B) 4-6 weeks
      C) 50% for non-premium buyers or non-primary territories, 70%-80% for premium buyers in primary territories.

      • Thank you very much for the info. If you’d allow me one quick follow-up question: Let’s say I had a 1M dollar production budget but also had an additional 1M in P&A funds. Would that qualify the film as a 2M film? If so, would I be able to count on obtaining a completion bond easier and, thus, a pre-sale loan?

        Thank you very much

        • Even with an additional $1m in P&A, it’s still a $1m movie, which means it runs a higher risk of falling apart before it gets into production. But everybody has their price, so if you’re willing to pay them 2% of $2m (or more), then anything’s possible.


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