Crowdfunding

Lately film industry people are using crowdfunding sites to raise money for their film endeavors.  In exchange for money you donate, they will give you an autographed postcard or in the case of Spike Lee he will take you out for dinner and to a Knicks game, depending on how much you donate.  One thing Hollywood people can’t do is give you royalties on the movie if it hits big.  Well that is about to change.  Obama put through a law in April of 2012 to make “equity crowdfunding."  This is an attempt to help the depression like era that we live in. 

There are a lot of crowdfunding sites out there like Kickstarter, probably the more popular or at least one of the first.  Well, Kickstarter has no plans to start equity crowdfunding, but there are some sites like Indiegogo who does have plans to start equity crowdfunding and they will have some competition with other sites.  There are a lot of rules and regulations that go into this new law.  Such as you have to have a $1 million dollar worth and your annual income has to be more then $200,000.  Which make for about 9 million American who qualify.  There are allowances for people who don’t make that much money. 

According to Jason Best, “it opens up access to a lot of capital for filmmakers.”  Think about all the people out there who want to make a film but can’t, well this is one way that they can. So even with all these new limitations that Obama put in to effect there should still be about $4 million going to filmmakers in the next four years.  That is a nice chunk of change.   You may not know this but in the US there is about $30 trillion dollars in savings and investments, so if crowdfunding can get 1%, that translates into $300 billion and that may friends is a lot of money.