If you have read our previous blog where we discussed, whether or not you should invest in an indie project, you know the answer very well. ( if you haven’t then you can check out Why Do We Need To Invest More On Independent Films?) Investing in independent films is a smart way to support the arts, put extra money to good use, and experience the thrill of being a part of something truly amazing. How wonderful would it be if the project you invested in managed to be one of those unpolished diamonds that periodically rise to the top and dethrone the huge movie studio productions?
How to invest in an indie film?
Here is a step-by-step direction of how you can invest in an indie film with profit:
Ask yourself “why”?
Depending on how you choose to invest in independent films, there may be extremely good profits. In addition, you are advancing a sector of the economy that is crucial to society, and as a result, your organization may benefit from various side effects, such as goodwill spreading to affiliated businesses or personas. Additionally, if you invest in all the offshoots like theatrical releases, DVDs, video on demand, cable, international markets, etc., you may make a lot of money. Tax benefits and other advantages that may come with investing in the arts (depending on where you live) are another justification for doing so.
Independent movies as a non-correlated asset class
Every non-correlated asset type in the world has underperformed films and film finance. In the past three years, motion picture finance deals have received $6 billion. IRR across the board for studios and independent filmmakers is resistant to general economic downturns in other sectors of the economy.
Good for portfolio
As the investment gurus say, a diversified investment equals to lesser risk of financial loss. Investing in an Indie film can be an added jewel to your investment crown. It is hence good for your portfolio.
Do a long-term investment
Don’t take a chance on one movie in the hopes of winning a festival. Instead, think of financing 10, 20, 40, 50, or 75 movies. That way, there will be more than just potential growth in each film’s earnings; there will also be a final exit plan after 5–7 years that may result in 300–400% returns on the cash spent.
Your position does not define your investment ability
Smaller investors in the USA can benefit from their investments in a number of ways, including the potential for Section 168k benefits, an immediate return from the monetization of state tax credits as part of the equity stream, an upside in investing in multiple movies rather than just one, and being involved in the creation of jobs and economic growth (every film production creates 50–100 jobs).
If you are an independent filmmaker, WFCN has the perfect platform for you. Once you are done making your independent movie, you can surf through our 550+ top film festivals and find your niche. We also have CANVAS, a platform for self-distribution. Go and check it out now!