When it comes to creative filmmaking - it's a practical business.
- Financing and Budget
- Locating and Contracting Cast and Crew
- NZFC Contracting
- Cost Reports and DPRs
- Recoupment and Points
- Audience and Market
- Applications and Contacts
Once you have a script ready for production, a producer and director attached, you'll need to create a budget for your film to work out how much funding you need, and a cashflow schedule to work out when you'll need it.
First films are often low-budget as new filmmakers are usually unable to attract significant financing. Low-budget feature films are made for less than NZ$1 million and require a methodology so the film can be made cheaply without compromising quality (for example shooting all in one room, or shooting on weekends). There are an increasing number of low budget initiatives available, including Make My Movie - which we support. You may also find a way to secure your own finance through sponsorship or cash or goods and services support.
Post production financing and prints & advertising grants are available to help some productions that have already been shot.
For features it’s important to think about how you’ll get your film seen. You need to make sure you’ve kept enough money aside to be able to deliver your film to the audience and to any festivals here or overseas that it may be selected for. Some money will need to be allocated to marketing, a trailer, an electronic press kit, insurances (including Errors and Omissions Insurance), music licenses (world rights will be more expensive than domestic rights), archival footage (can be very expensive), and legal fees. Good budgets contain roughly 40% for post-production and an unallocated contingency, for emergencies, of roughly 5-10%.
A local line producer, production managers, casting agent, acting agency, or drama or film school can help you find cast and crew. You may also find Film New Zealand or websites such as The Big Idea useful.
New Zealand has strict guidelines for employment. We suggest you get yourself a copy of the Pink Book (for cast) and the Blue Book (for crew). These are the official codes of practice and are available through the SPADA website. The New Zealand Writers' Guild (NZWG), Actors Equity, The Screen Production and Development Association (SPADA), New Zealand Film and Video Technicians’ Guild and the Screen Directors' Guild of New Zealand (SDGNZ) can also offer advice. These organisations, in addition to actors’ agents, may also be available to help with template contracts. International cast and crew may also be subject to specific Immigration requirements.
As soon as possible during the writing process you should look to establish a new company to act as the holder of all rights and signatory to all contracts for the film. This company is known as a Special Purpose Vehicle or SPV. You can easily establish one online for a small fee by visiting the New Zealand Companies Office website. Think carefully about who will act as directors and shareholders in this company as this can affect ownership and say in the project. Company directors will be the signatories for contracts for the company.
Chain of title is a technical term referring to the chain of ownership of the idea the project is based on:
- If the team picks up a script that has already been started or is adapting another type of work into a film then the SPV will need an option and purchase agreement
- If the team brings any writers on board to adapt the optioned work, or provide editing or consultant services, then a writer's or script consultant's agreement will need to be entered into with the SPV
- If either agreement is entered into with a party other than the SPV then that party will need to enter into a deed of assignment with the SPV prior to receiving funding
All rights must sit with the SPV and form an unbroken chain in order to be considered for our funding or distribution deals. Templates for these agreements are available at the NZWG website.
If you receive financing from us, we’ll need you to enter into a funding agreement (which we can draft). We may also initiate a sales agency agreement and/or a security agreement and lab access letters. You will need cast and crew contracts for your lead cast and core team. We may also require a bank mandate, confirmation of insurance, completion bond, TV license, legal opinions, and any pre-sale or distribution agreements although many of these requirements are waived for lower budget films.
There are a number of local lawyers who can help with the various levels of contracting that may be required. If you’re seeking financing from us, please ensure you budget for our legal fees.
You will be expected to prepare cost reports and daily progress reports (DPRs) for us and other investors. Cost reports should clearly show what has been spent and what is expected to be spent against your budgeted spend and any variances. They should also include contingency spent to date. For any large overages and underages, an explanation can be helpful.
DPRs should show:
- call times
- end times
- break times
- people on set
- scenes shot
- scheduled scenes not shot
- rolls of film used/ratios
- any accidents on set
- an explanation of any other significant goings on.
We expect to receive:
- monthly cost reports during pre-production and post-production
- weekly cost reports during production
- DPRs during principal photography.
These invaluable records are useful to monitor progress and on occasions when disputes arise.
Recoupment refers to how any income from your film is shared. For traditional distribution, GST, the exhibitors’ fees, distribution fees and distribution expenses will be paid out first along with any advance the distributor may have paid. This may leave some money for equity investors and to repay any deferrals key creatives have made.
We often allow private investors to recoup before us.
When we recoup our investment our standard position is to allow a producer to recoup alongside us to the value of 40% (meaning we would be paid at the same time with the producer receiving $4 of every $10 we receive etc.).
When the project has returned all money to investors the project is in profit. We allow producers to take 50% of all profits with the remainder to be shared between the investors in percentages equal to their share of investment in the film. Some low budget schemes such as Escalator have allowed first position to the producers to share with their points participants.
Points schedules outline how the producers’ share of profits are to be distributed. Points out of 100 equate to the percentage each individual cast or crew member allocated points will get. While we operate a collection account for films to distribute the income to investors as per the recoupment schedule, it’s up to producers to distribute any income from their share.
Filmmakers should make their films with a clear sense of their intended audience in mind. It is important to think about that when making scripting and shooting decisions, which in turn will help with implementing a distribution strategy. We expect all films that receive funding from us to have a theatrical release in New Zealand and we want to know how you’ll achieve that when you apply. Teams can approach sales agents and distributors before pre-production and some may even contribute towards the budget (known as a pre-sale or sales advance).
If you wish to make an application for financing please go to Production Financing.
If you have any questions on any of the above then feel free to contact:
Business Affairs – [email protected]
Professional Development – [email protected]
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