When a Producer raises money for a movie, a big chunk can come from distributors buying the rights to distribute the film once it’s made.
It’s called “pre-sale financing.” And you can read more about it here.
Some Movie Producers raise 1/3 of their capitalization with this strategy. If there are stars or big brands attached, it’s an easy way to capitalize a film. (And you get the benefit of telling potential investors that people have paid for the right to distribute the film before it’s even made – which makes it look more attractive for those potential investors.)
This strategy wouldn’t work on Broadway twenty years ago. Broadway wasn’t as cool . . . and it wasn’t as global. Now, with Broadway extending to all the corners of the globe, the rights to present Broadway shows in those markets have become valuable. And with each passing year, there are more competitors in those markets, which means the players have to get more aggressive in acquiring titles.
That’s why over the last ten years, it has become more common for Broadway Producers to trade the right to produce (aka “distribute”) a show in a certain territory for an investment in the Broadway company.
My prediction? Based on the emails I get in my inbox, this is only going to increase over the next ten.
And it should. But not just from foreign rights. Domestic too. Anyone that benefits from the post-life of a show on Broadway (or even current life) could (and should) offer to help get that show off the ground. It’s a terrific strategy for licensing companies, vendors and more to build their pipeline.
For those of you raising money for your shows, anyone that could build their business off the brand you are building is a great lead for investment. So put them on your list.
Theater is the most collaborative art form there is. And that collaboration isn’t only about the art. It’s about the business of making art as well.
And if the movies can do it. Well, we can do it better. 🙂
If you want more strategies like this on how to find other people who are willing to fund your show (because it’ll benefit them), click here to see if you qualify for our NextStage program.