How are Hollywood Blockbusters Financed?

How are Hollywood blockbusters financed?  That is a question that any independent filmmaker want’s to know.  There are lots of ways that Hollywood movies makes money, like when viewers go to the movies, rent it, when accessible by DVD, or they buy the soundtrack.  You can also get money from television, domestic and foreign, pay-per-view or cable.  But please keep in mind that a percentage of these revenues are split up to different parties, like the actors.

Another way that money can be made is by merchandising and licensing contracts.  Studios usually get a portion of this money.  Paying for a movie is more then just making the movie.  There is a lot of money that goes into marketing a movie.  This is why you can’t just depend on ticket sales from the movie you need to rely on other investing avenues.    

When you think of movies being made you think of them being made in Hollywood, but when it comes to financing “the shoot spread across the world.”  Take from example Germany’s tax code.  Investors looking to manipulate finances invest in a movie to get tax reductions “right away.”  What they do is buy a movie and then lease it back to the studio.  So we all need to look to the Germans to finance a movie.  

You can always try to get independent backers on your film, like doctors or dentist.  But that is easier said then done.  Another great way to cover costs is through product placement.  Now don’t be to in your face when it comes to product placement and remember to blend it into your movies plot it can help with cost.  Just “keep in mind that backing movies is always something of a gamble.”  So when trying to find a backer make sure you have a solid pitch, have a business plan for the movie.