Filmmakers are sensitive artists, whether they show it or not. Your support means a huge amount to them, and if you give of it freely, you will receive great gratitude in return.
None of this means that you don't protect yourself contractually. Just the opposite. The more you set the terms for the relationship in a clear, up-front, and contractually-protected way, they more everyone is on the same page, and knows what is expected from them.
But if you approach your relationships, contracts aside, from a the spirit of gift-giving and receiving, you will find an amazing set of consequences will follow:
1. You will make a friend. A true friend. That is very valuable thing in this business.
2. For the investor, if the film succeeds, you will not only make money on your investment, but you will have a relationship with a successful and loyal filmmaker who wants to work with you again. The result is both bragging rights, and greater chance of future financial success.
3. For the film producer, even if this film fails, you will have a relationship with an investor who may still actually want to work with you again, despite failure.
Since the number of factors that can sink any one film is so great, this is a very valuable kind of relationship to have. You will likely need more than one bite at the apple to be successful. In other words, you may actually be on your way towards building a career.
All this is easier than it sounds.
The rules of gift-giving were laid out clearly for everyone to see by the great anthropologist Marcel Mauss, in his foundational 1925 book, THE GIFT. He understood that the giving and receiving of gifts was one of the fundamental structures that underlay all human interaction.
And the most important rule, he said, was this: When you are given a gift, you must give back a gift in return that is of equal value. If you give back less than you receive -- or, just the same, if you give too much, and do not expect back enough in return -- the relationship will turn out to be a bad one.
So, investors, don't be undisciplined and spend more than you need to. Bargain aggressively with your filmmakers.
And filmmakers, if you take the money you need to make your film, make sure you make it well.
This sense of equality -- that the amount of money a filmmaker invests is equivalent to the value, in the glory of art, or in the other glories the investor feels they receive from being part of the world of film – this sense of equality is the key to making the whole system work.
Filmmakers, don't see yourself as weak because you need someone else's money. Investors, don’t see yourself as dominant because you have the money a filmmaker needs.
Filmmakers also have what investors want -- artistic glory -- and that is worth the money the investors are spending, or they would not spend it. So, the two of you, producer and investor, are equals. You each have something the other wants, and you can satisfy each of your dreams by making an equal trade.
If you see the financing of a film in this way, you will find success, even if the particular film ends up failing.
As Mauss wrote in his conclusion to THE GIFT:
The Bretons, and the Chronicles of Arthur, tell how King Arthur, with the help of a Cornish carpenter, invented that wonder of his court, the miraculous Round Table, seated round which, the knights no longer fought. Formerly, 'out of sordid envy,' in stupid struggles, duels and murderers stained with blood the finest banquets. The carpenter said to Arthur: 'I will make you a very beautiful table, around which sixteen hundred and more can sit, and from which no-one will be excluded... No knight will be able to engage in fighting, for there the highest placed will be on the same level as the lowliest.' There was no longer a 'high table,' and consequently no more quarreling. Everywhere that Arthur took his table his noble company remained happy and unconquerable. In this way nations today can make themselves strong and rich, happy and good. People, social classes, families, and individuals will be able to grow rich, and will only be happy when they have learnt to sit down, like the knights, around the common store of wealth.
This is the secret. Pass it on.