Crowdfunding Faith Films and the Angel.com Model
By John Ware on
What is Crowdfunding?
Raising funds from a large number, who donate in small amounts during a relatively short period. Depending on the type of crowdfunding, investors either donate money with no promise of a return, and/or they get rewards such as equity in the company or project offered. Marketing is done via social media and crowdfunding platforms, and uses networks for greater reach. Crowdfunding websites bring investors and entrepreneurs together, expanding investors beyond the traditional circle of owners, friends & relatives & VC firms. Campaign length: 6-8 months.
Advantages to Crowdfunding:
- Bring sector experts into your company. Open doors to new markets. Introduction to key personnel. Increase your network of current and potential future investors.
- A very public way to validate your business plan
- Achieving 100% of your goal/overfunding, attracts interest!
- Building Your Audience = Longevity
Needs:
- A Compelling Pitch
- Messaging
- Q & A Strategy
- Connecting with your Audience
- Post-campaign
- A Customer base of meaningful size to engage. Investors will not lead, but will follow the crowd. Big money from many donors/investors = Validation of your idea for Investors
Costs:
- Video: $2500 - $5K
- Consultants: $2 - 4K
- Platform fees: 6-7% of the amount raised plus closing fees
- Legal: $5-10K or more
The Angel Studios’ Model
Provo, Utah based Angel Studios, Inc uses equity crowdfunding to finance original productions. Individual investors purchase shares of upcoming media productions. Notable crowdfunding hits include The Chosen, which raised $10.3 million for production and was the largest ever crowdfunded entertainment project in history at the time.
What is the Angel Guild? Guild members rate projects by watching and voting on “Torches” (undistributed concept footage or completed films, TV series, and docs). According to Angel, “fans” can join the Guild by: A: investing $100 or more in an Angel Original or B: By subscribing monthly to the Guild for $20.
Submissions: For a fee, filmmakers may submit torches to Angel Studios, who will then share the torch with the Angel Guild. About 6% of all submitted productions get a green light in the following categories:
- Children’s Shows and Concept Videos,
- Documentaries & Completed Productions, and
- Films Intended for Theatrical.
“Pay It Forward” vs Investing: According to Angel: “Both benefit the project. However, an investment is the purchase of investment shares from the creator with the hope of a monetary return on that investment. A Pay It Forward (PIF) is a purchase that benefits the production, but has no expectation of a monetary return. Instead, with the purchase of a PIF we offer certain perks which include the opportunity to help share the show with more people across the world.”
Levels of Engagement: You can invest in “Sponsored Torches” (approved by the Angel Guild). These get the best placement in the crowdfunding offerings. You can also “Express Interest” for projects which are under consideration for funding.
When you consider investing, you are taken to “Angel Funding” and you get this message, "You are now leaving this website to enter Angel Funding, a FINRA regulated portal." This ensures that all legal hurdles are managed precisely, as they must be.
Conclusion: There are many modes of involvement. Do your research at Angel.com. The devil is in the details, but this is an exciting model in the faith film market, stay tuned.