Complexities involved in film funding business  

Marvel's "Black Panther" was one of the highest grossers' of 2018, which earned over $1.279 billion in the initial screening.

In the last few years, science fiction and horror films generated huge ROI, like Star Wars: The Last Jedi, which grossed $1.332 billion, and Harry Potter and the Deathly Hallows - Part II, which earned over $1.3 billion.

Star Wars, Marvel Avengers and Jurassic World Series have been some of the biggest grosser in the last few years. Overall, movie-making is a gamble. Only some rare stories and pictures can earn much higher than the investment.

First-time film funding may involve a combination of financing options, and initially, the producers may have to work for free, where they rely on the film's success for payments.

Jurassic Park, released in the 1990s, earned $400 million at the box office, while the script was bought for $1.5 million.

Some rare cult classics failed to deliver even though the investments were higher - like Mozart and the Whale, which earned less than $100,000 at the box office, and the investors paid $2.75 million for the script.

Financial rewards have been linked to the inception of the Marvel Cinematic Universe and Robert Downey Jr., who debuted as Iron Man and was paid $20 million to appear in the movie -Avengers: Endgame.

Some of the top scripts of the year were 'Captain Marvel', 'Aladdin', 'Toy Story 4', 'John Wick: Chapter 3', 'The Secret Life of Pets 2' and others.

Not all, but some films provide a great investment opportunity. Some small-budget films can earn millions. The low-budget thriller 'Ma', starring Octavia Spencer, was made from an investment of less than $5 million, and till now, it has earned over $57 million worldwide.

How to get film funding?

One can raise money for investing in films based on past credits, position, and experience or through an alternative mechanism like equity-based financing.

The investors contribute to the movie-making projects and are given a share in their investment to help gain profits.

There are multiple ways to devise such strategies, but the investors need to identify many risks in film financing, and profits are not guaranteed.

The firms offering such opportunities should provide all details about their projects to the investors, who should know the risks involved.

Depending on the perceived strength of the project, the distributors can execute the pre-sale contract. Filmmakers can get funds from bank loans for pre-sale marketing and deals or directly get payment through distributors.

A filmmaker can get loans from the bank through a personal guarantee, or they can put up the film or related intellectual property as collateral.

The movies that work can earn the producer for years after the release through television and other sales. Bridge loans or tax credits can help to get funds where individual states or the country can provide subsidies on production through tax cuts.

Moviemakers can hire local talents to gain such benefits. Crowdfunding is the latest method that helps raise money and provides a way for friends and family to contribute to the projects.

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