FEATURE
money raised is lower than Kickstarter’s 5% and it also allows campaigns to receive all the money pledged, whether or not the initial fund- ing goal has been reached “Campaigns on average will get 20% from
strangers,” explains Rubin. “Some campaigns will get 90% from strangers and some won’t get a dollar at all. To get exposure from IndieGoGo and stranger dollars, you want to have a high GoGoFactor — a custom algorithm which tracks how active every campaign is based on comments, funder updates, promotions etc. Based on the 50,000 campaigns on IndieGoGo, the typical tipping point to start getting stranger dollars is when the campaign has reached 30%- 40% of the funding goal.” IndieGoGo counts among its successes last
year’s audience award winner at the Tribeca Film Festival, Give Up Tomorrow, as well as international productions such as UK docu- mentary You’ve Been Trumped and Japan’s Hafu. A partnership with the UK’s Sheffi eld Doc/
Fest means the site also hosts a whole day of live crowdfunding pitch sessions staged during the festival. How much of a dent will this all make in the
Oscar-shortlisted Battle For Brooklyn raised funds on Kickstarter Online funding’s in-crowd
How much impact can crowdfunding sites have on the $22bn global investment business? Colin Brown looks at the key sites
ing. Battle For Brooklyn and The Loving Story both raised fi nishing funds through Kickstarter, one of as many as 250 platforms that offer fi lm- makers and other creatives a chance to pitch for small donations from friends and strangers alike via personal videos. These online appeals are posted on the web- site alongside a description of the project and an escalating list of rewards that come with dif- ferent pledge levels: a T-shirt, a DVD, a digital download, an invitation to the festival premiere and so on.
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Battle For Brooklyn received $25,506, which was then enhanced with a matching grant. The Loving Story, which needed cash to meet the costs of a hefty licensing tab for archive footage and music, secured $15,383 towards post-production; most of its backers opted to pledge $25 in return for a ‘thank you’ credit and regular e-newsletter updates. There have been more than 4,000 successfully funded film and video projects on Kick- starter since it was founded by Charles Adler, Perry Chen and Yancey Strickler in 2009. Those projects have raised more $41m in combined pledges. That figure breaks down as follows: $13m for nar- rative features including a
■ 46 Screen International at the Berlinale February 10, 2012
mong the 15 documentary features originally shortlisted for the Oscars were two that received some of their fi nancing through online crowdfund-
direct-to-DVD release of Hal Hartley’s Mean- while; $16m for documentaries; $8m for shorts; $2m for web series; and $2m for animation. “Kickstarter is really the latest iteration in the
long history of arts patronage,” says the site’s communications director Justin Kazmark. As Shooting People’s Ingrid Kopp points out, the value of crowdfunding extends well beyond the dollar amounts. “A lot of fi lm-makers have realised that a successful Kickstarter campaign is not just about the money raised but also about the supporters you bring to your project going forward. I personally feel very invested in all the crowdfunding campaigns I have contributed to and would be far more likely to pay money to see them in a cinema or give other kinds of pro- motional support down the line.”
For all the attention garnered by New York-based Kickstarter, its donations require a US bank account. There are no such geographic limitations for its San Francisco rival IndieGoGo, the leading global platform for crowdfunding projects of all kinds, including charitable causes, that has also distributed millions of dollars since launching in 2008.
“We have hosted more than 50,000 campaigns,” says CEO Slava Rubin. “As long as you have a bank account, there are no restrictions on locations for project owners or funders. We are open to 200 countries.”
IndieGoGo’s 4% cut of (Left) Give Up Tomorrow
$22bn annual film investment marketplace? That depends on the scale of production. “For the independent film-maker, disruption is already happening,” suggests Shooting People co-founder Cath Le Couteur. But for larger fi lms, crowdfunding’s future
may pivot on the Entrepreneur Access to Capi- tal Act, HR 2930, under review in the US Sen- ate. If approved, the law would allow crowdfunding to include equity investments in projects, and not just donations. Projects could raise up to $2m, in no more than $10,000 increments. “The good news — and the bad news — is
that no restrictions have been placed on what types of companies can raise capital in this man- ner,” observes film-finance expert Jeff Steele, who spearheads Film Closings. “So it’s a wide open fi eld for innovation — and corruption. “Gifting sites like Kickstarter and IndieGoGo
‘A successful Kickstarter campaign is not just about the money raised but also about the supporters you
bring to your project’ Ingrid Kopp, Shooting People
have gone out of their way to steer clear of sell- ing securities,” Steele continues. “Nevertheless, they have the infrastructure to segue into a post HR 2930 world as a securities brokerage. But, speaking as somebody who also advises media technology companies, they would be wise to wait for the IRS to fi nalise the rules and regula- tions spelling out who can or can’t participate and what the brokerage requirements are.” Steele believes far greater potential lies in
innovative micro-licensing sites such as SoKap. com that allow producers, authors, musicians and game developers to raise project funding by pre-licensing their distribution rights on a hyper-local level. For example, a film-maker could license the rights to market and distribute a fi lm in just Santa Monica or across all plat- forms in California from which they will receive an off-the-top distribution fee on sales. “This allows fans, merchants, early-adopters
and taste-makers to monetise their social net- works and participate in the value chain of the products they support,” Steele suggests. “Tradi- tional prints and advertising costs, which are prohibitively expensive, will become much more coveted word-of-mouth campaigns, the onus of which falls to the local distributors, not the producer.” Welcome to the fi lm industry’s Facebook era.
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