Thursday, July 31, 2014

All About Crowdfunding

Well, this post isn't really ALL about crowdfunding.  Instead, I'd just like to share a few thoughts regarding some of the things I've been learning.

Crowdfunding is really gaining traction as a method filmmakers use to try and raise funds for their projects.  It has met with limited success.  Part of the reason, I think, is that many folks jump into crowdfunding before really researching and preparing for what a campaign really entails.

With our feature film Cyber Fighter still in development, I've been doing a lot of research into the crowdfunding realm to analyze the potential benefits vs. costs of mounting a crowdfunding campaign.  With the success of Zach Braff's Wish I Was Here , Spike Lee's latest Joint, or the Veronica Mars Project, the excitement for Kickstarter and Indiegogo is at an all time high.

Now, there's a semi-consensus out there that feels that those projects mentioned above achieved their success because of the star names driving the projects.  Since there was already "brand awareness" out there, these folks had a much better chance of raising over $1M in pledges/donations.

But the other big success story of Kung Fury, a small indie film project out of Sweden that was shot entirely on green screen with CGI elements, gives the unknown filmmaker hope.  With a $200K goal, they managed to raise over $630K in contributions from over 17,000 backers.  What made this film campaign so successful?

First, the project itself was compelling.  Here was an outrageous send-up of bad 80s movies, completely over the top and hilarious.  The pitch video showcased a lot of the CGI effects (of which a lot was already completed), so potential backers got a real good look at what they would be getting on board with.

Second,  the rewards were priced accordingly, and related to the film.  Plus, there were pretty cool rewards at the higher tiers.  The filmmakers weren't asking for $100 for a coffee mug or T-shirt.  However, if you look at their campaign, you'll see that over 600 backers chose the "autographed poster" reward, which means the director will get a serious case of writer's cramp!  But that's one of the costs of success, and hopefully the filmmakers built the cost of reward fulfillment into their budget.

Because this project was unique and fun, it generated a viral word of mouth that eventually spread to the media which increased its visibility.  I think filmmakers should take a cue from this campaign and study it extensively to see what they did right.

But it's not enough to study success, you also need to look at common mistakes to avoid the same pitfalls. Here is a generalization of a few observations of crowdfunding mistakes I've seen:

1. Overestimating Your Relevance - Beware of going into a campaign thinking that everyone is just going to eat you up and love your film!  The truth is, there's a cacophony of noise that you have to fight against just to get noticed by a few.  In order to get traction, your campaign has to appeal to the general public, not just friends and family.  If you build it, they will not come unless they know about it, and feel personally interested in it.

2. Crappy Rewards - Too many campaigns offer the same coffee mug/t-shirt/DVD reward at a price that multimillionaires would consider insulting.  If you're going to offer those rewards, make sure you price them according to the market.  Put yourself in the backers' shoes.  What kinds of rewards would you want?  Creative rewards that directly relate to your project will definitely get better notice, and if it's really something special, you may be able to offer it at a higher price.

3. Not Connecting With Your Backers - This should be a no-brainer, but you'd be surprised at how many campaigners feel that they are too busy with their process to reach out to their audience.  Listen, people who back projects are looking to connect with the process, not just "buy a ticket".  Any time you can offer more value to your audience, you will stand out.  These folks who've invested in you are your audience. No matter how big you get, if you can keep engaging them, they will be loyal to you and your future career.

4. Not Backing Any Projects Yourself - People will tend to support those who've been supportive of others.  Before going off with your own campaign, find a few projects that you like and back them.  Not only does that generate good Karma in the Universe for you, but it shows the community that you're not just out looking for "free money".  Here's a tip:  Make sure to create your professional profile on the crowdfunding platforms before you donate to others' campaigns.  That way your profile will have a track record of backing projects so that when you launch yours, you've already laid this groundwork.  Always back projects through this profile so that you create an identity that others associate with you.  Who knows, some of these people you've backed may return the favor someday!

5. Failing At A Campaign And Immediately Launching A New One On A Different Platform - Don't be the crowdfunding equivalent of a panhandler standing on the corner bumming for money.  If you decide on Kickstarter, know going in that it's all-or-nothing.  If you don't reach your goal, you get nothing.  So don't immediately announce that you're launching again on Indiegogo and expect the Kickstarter backers to follow you over there and throw money at you.  Since your initial campaign failed, these backers have lost a little confidence in you.  If your Indiegogo campaign doesn't succeed, then you will still keep any money that was pledged, but that doesn't mean you'll be able to finish your movie.  Backers already know this, and aren't going to give up their money if they don't think you can deliver the finished product, much less the rewards.  Decide beforehand which platform on which you're going to launch, and stick to your guns.  This wishy-washy campaigning is like the person who tries to date 2 people at the same time.  It doesn't end up well.

6. Setting Your Goal Too High - This is what primarily contributes to campaign failure.  Say your production budget is for $2 million.  If you try to raise all the funds via crowdfunding, your odds are greater for failure than if you tried to raise only $20K.  Crowdfunding experts have mentioned that campaigns are like a middle-school dance.  No one wants to go out on the dance floor at first, but once enough people are out there, soon the whole floor fills up with dancers.  It's the same with crowdfunding.  Backers want to back winners.  If your goal is reasonable enough, you'll find that it's reached sooner and people will continue backing even after your goal is reached.  You want folks to feel like they want to get on board with the next big thing.

But what if your budget is already reduced to the minimum and you still need $1M?  Here's where you have to get creative.  How can you still realize the film if you can only raise a fraction of the money?   Going back to the Kung Fury guys -- they had already shot most of the live action scenes on green screen and only needed the money to complete the CGI work.  If you break your project into phases, you might be able to crowdfund for each phase (ie. Prep, Production, Post Production).

7. Online Panhandling - Essentially begging for money...all the time.  The constant flood of e-mails asking for support, Facebook posts saying "we need your money",  painting yourself as a starving artist who's desperate...these tactics never work.  Plus, if you use them on your friends and family you risk alienating them.  Along these lines are those Facebook and message board posts just asking people to look at your campaign.  Since everyone seems to be doing this, what makes you think that your post won't be ignored either?  Think about it -- when you see all those "check out our campaign" FB posts, do you click on the links?  If not, then it's most likely that others will ignore you as well.  Nobody likes to be constantly hit up for cash, and I know that most folks don't feel comfortable asking for money either.  But since the truth is that you do need the money, there are much more productive and professional ways to go about it.  See the next section for more elaboration.

Things To Do Right:
Here's a few things that I think filmmakers should do with their campaigns.  I've seen the successful projects use some or all of these, so it bears mentioning:

  • Share the campaign:  Announce your campaign and the goals, but don't beg.  Instead ask folks to spread the word, and if they want to support, great!  If not, that's okay too.  Not everyone is able to contribute money for whatever reasons and you need to respect that.
  • Regarding FB Posts and message board posts:  First, give people something of value and then use your campaign announcement as an afterthought.  By giving away something useful, people are more likely to check you out.  Remember the end of It's A Wonderful Life?  George Bailey (Jimmy Stewart) spent so much of his life giving and helping other people that when he needed them the most, they were there with a flood of support.
  • Keep updating your backers with the good news:  As you reach a milestone, share it with your backers.  Keep them invested in the campaign.  The folks who've backed your project will help spread the word and possibly do the "arm-twisting" for you.  They're invested in your success!
  • Use social media wisely:  Tweet milestones to your followers, use your movie's Facebook page to announce milestones as well.  This is the equivalent of Coke & Pepsi's advertising - to keep awareness out in the public
  • Have your campaign planned like a war.  There's a reason that the military refers to battles as "campaigns" -- a lot of strategy and planning goes into it before troops are deployed.  So it should be the same for your campaign.  Have your milestones planned, consider pre-writing your tweets and updates so they're ready to go, but always be prepared to change things on the fly -- just like a real battle.
There you have it, a few of my personal observations on the whole crowdfunding phenomenon.  It's an exciting time, where artists are able to connect directly with their audiences and give their fans a chance to be part of their creative process.  No other time in entertainment history has this been possible, and I think that the trend is going to continue.  Those artists that understand their audiences will be the most successful in this new generation of the entertainment industry.  Hopefully I've helped you to think of things in a new way and inspired you with your projects.  Please feel free to post your own thoughts in the comments section, and best of luck!

1 comment:

  1. You will always have my support! Great article! :)

    ReplyDelete