Lessons Learned from the Film Market Trenches

Switching distribution guns to KILL MODE!

The distribution journey for a Dutch-made low-budget action/sci-fi flick.

Kill Mode’s Release Wasn’t Timed to Coincide with a Global Pandemic! (2020)

Kill Mode was released in the United States on March 17 by RLJE Films, our U.S. distributor, through a deal brokered by our international sales agent, Raven Banner Entertainment (Canada). While this blog entry is principally about how the Kill Mode producers secured and negotiated distribution, it’s worth spending a little time telling you how we got here.

It’s an uncertain time right now. As I write this article, the world has been caught off guard by what is probably the most serious pandemic in a century. The Cannes Film Festival has just been postponed to some undefined date later in the year, and a foreboding sense hangs in the air as to it taking place at all. But the world has been through pandemics before and we will get through this one, too.

In the meantime, let’s watch films (but please stop panic buying toilet paper).

As Kill Mode deals with the aftermath of a pandemic run amok, maybe it can do its small part to help people get through an evening at home when they’d rather be doing something else. In the longer term, I hope the lessons we learned finding distribution are helpful to producers looking to secure distribution for their films, both now and in the future when film markets resume.

Logline: In the aftermath of a badly handled global pandemic, a rebel group tries to free a young girl held in quarantine by an all-powerful corporation.

Plans are Worthless, but Planning is Everything

Although you need to have a good plan when setting out to produce a film, there’s so much in this business that is dictated by chance. It’s probably the inner gambler in me that drew me to becoming a film producer. For Kill Mode—which was written seven years ago but it’s appearing to be quite topical—we made the decision months ago not to take a theatrical offer and go straight to video on demand (VOD). While it was tempting to go for a vanity theatrical release, we thought the VOD route made more commercial sense over the longer term.

We encountered severe delays in both production and post-production (the original goal was to release the film this time last year), which pushed us into the current release date. And somewhat serendipitously, we might add, given that now people are being forced to stay at home at a time when pandemic related movies are seeing an uptick in popularity. How all of this will affect Kill Mode remains to be seen, but my guess is both quirks of fate will be for the positive. In addition, it’s not really a festival film, so the current rash of festival cancellations doesn’t affect us too badly, at least from a commercial perspective.

Breaking into “The Company”

Burt Rutteman (Richard), Dave Mantel (David Oscar), Yasmin Blake (Alex)

A disclaimer. All of my advice, while built up over five years of attending film markets, is based on a data point of securing distribution for one film. There are producers with vastly more experience than me. I welcome your feedback and comments so that we can share with Stage32 members the most comprehensive overview possible. Also, Kill Mode is a “no names” low budget (less than $500k) action/sci-fi film, and, as mentioned, not really a festival film. Some of my advice may well apply to films of different genres, budget levels and/or with well-known actors, but some won’t.

You Can’t Do This - It’s Too Ambitious (2012 – 2015)

The concept for Kill Mode was conceived by writer/director Thijs Meuwese (first name like “rice” with a ‘t’, last name “may-use-ah”) and producer/actor Kris Patmo in 2012. While technically a first-time director, Thijs had already written, directed and produced a full-length fantasy feature with Kris, Magistratus: Overtura, in 2012 for his graduation project from film school. Thijs wrote the Kill Mode script in 2013 and eventually, it won the Imagine Film Festival (Amsterdam) Pitching Contest in 2015. The first prize was flight and hotel to the Frontières International Co-Production Market in Montreal later that year.

At Frontières, Thijs and the team from Get Off The Road Productions (GOTR) were told in no uncertain terms by several long-time industry professionals that what he had written was way too ambitious for a first time director, and that first he needed to prove himself. Thijs had crafted action sequences paying homage to all of his favorite action films as a kid. We are talking the kind of action film that if produced by a studio major, would have a budget of $60 million-plus.

Listen and React to Industry Feedback! Enter: Molly (2016 – 2017)

I know that at this point, some filmmakers would pout. I can just see the cries of “They don’t understand my vision,” “I’ll show them” etc, which might explain why some films never get made. Instead, the team reacted to the feedback, and quickly changed the pitch to Molly, the envisaged sequel to Kill Mode—a script still with lots of gritty action sequences, but easier to pull off and with less special effects, and most importantly, with a lower budget.

Kill Mode character posters: Molly (Julia Batelaan) & Alex (Yasmin Blake)

Thijs and his co-director and producing partner, Colinda Bongers, along with the rest of the GOTR team, attracted private investment and finished Molly in 2017.

Molly is a good example of why sometimes you have to downscale your ambitions in the short term to achieve your longer-term goals. Molly has an 80% Rotten Tomatoes score. One reviewer had this to say: “Brian De Palma himself would be taking notes on how Bongers and Meuwese filmed in such tight spaces.” Not a bad calling card. Having proven themselves with Molly, the team, and their investors, were ready to tackle Kill Mode.

Indie Filmmaking Better Be Your Passion because it’s Tough! (2017)

Kill Mode had 34 shooting days over a period of two months in 2017. Shortly after the shoot, an investor pulled out, leaving post-production stalled. It was in February 2018 at the Frontières Financing and Packaging Forum in Amsterdam that I met Colinda Bongers from GOTR and learned about the state of the project. GOTR invited me to come onto the project to find another financing source so we could finish post, and help secure a distribution deal.

While we did eventually receive a financing offer, we decided for a number of reasons not to take it, and we were left with our plan B: convince the crew to finish the film on a deferred pay basis. But this required us to demonstrate to them that they would eventually be paid, and for this we needed sales estimates from a sales agent. My goal was clear and I immediately began preparing for the Marché du Film in May 2018.

The Wild and Woolly Film Markets: Don’t Let Them Intimidate You! (2018)

To sell an indie film a producer hires an international sales agent to make sales to territorial distributors on the film’s behalf. In my opinion, it’s an inefficient process that’s not very producer friendly, but it’s what we have to work with right now. How the system might change in the future is another discussion. Lots of people take their cut of the pie along the way, as cash (hopefully) eventually winds its way back to the producer over the coming months and years. Of course, there are things like all-rights streaming deals, but even those deals pay in three installments or so over a period of many months.

Chopper-boat

Wes Mutsaars (Declan), Mareille Labohm (Bishop), Cyril Guds (Angel), Daan Colijn (Emerson), Geoffrey Thompson (Cole), André Dongelmans (Cassidy), Rein van Duivenboden (Ford)

A Good International Sales Agent is Your Friend

A word about sales agents. I believe a good one is worth its weight in gold. There’s no way you can get the most monetary value out of your film without a good sales agent, outside of potentially an all-rights streaming deal—if you are lucky enough to have Netflix on speed dial, which most of us don't. You will never be able to duplicate a good sales agent’s network, and distributors don’t want to talk to you anyway. It’s simply an inefficient use of their time. Even if you could cut 20 or 30 deals, wouldn't you rather make films, instead of spending all of your time negotiating distribution contracts?

If you are new to the game, here’s what I would do: get hold of a Screen International Product Guide from the market you are planning to attend, or the most recent market proceeding the one you are attending.

The film market cycle in any given year is:

• European Film Market, Berlin, February
• Marché du Film, Cannes, May
• American Film Market, Los Angeles, November

When you buy a film market accreditation, you will also get one year of access to Cinando, the online database of film market attendees. From the Product Guide and Cinando, you can target sales agents that will be in attendance that look relevant to your project by looking at what they are selling.

A few weeks before the market, start contacting them for meetings, keeping in mind that if you are cold emailing, you will probably get a 10-15% response rate. That’s fine. If you send 100 emails, you can get ten meetings secured. That takes the pressure off from having to booth crash on the spot. Sales agents find this pretty annoying, especially early in the market when they are focused on distributor meetings.

In the latter half of the market, sales agents have more time for producers. Towards the end of the Marché du Film last year, one sales agent spent two hours with me giving me all kinds of advice about our film projects.

Escape from “The Company”

Dave Mantel (David Oscar), Yasmin Blake (Alex), Julia Batelaan (Molly), Shilton Chelius (Berg), Burt Rutteman (Richard), Kris Patmo (Barry)

“I Need to See Some Footage, but Stay in Touch.”

At the Marché du Film 2018 (with Kill Mode stuck in post), our biggest assets were:

• A finished shoot
• Thijs Meuwese had a solid credential with Molly
• We had one of the best look books I’ve ever seen

Our biggest detractors were:

• We didn’t yet have any kind of teaser
• The film was very dependent on quality VFX work
• We were out of money

Nevertheless, I had built up some contacts from prior film markets, and pooled mine with GOTR’s contacts to get some meetings set up. I got a smattering of meetings, but even with Thijs’ credentials as a director, I wasn’t getting them with just a snap of the fingers. To quote Warren Buffet: “If the phone’s not ringing, you’ll know it’s me.” Nevertheless, we got the ball rolling. The usual response was: “I need to see some footage, but stay in touch.”

Negotiating a Sales Deal Without Being a Pushy, Bluffing Tool Bag

Furthermore, I’m a terrible cold caller and booth crasher, and have questionable bluffing skills – all traits that seem to be required of a film producer. But that’s just not me. I overcame the first handicap by setting up meetings beforehand by email. Still working on my bluffing, but I’ve also realized that it might not be necessary if you have a solid plan and a good product.

I teamed up with Jasper de Vreede from GOTR to do most of the negotiating. It was great to have him as a sounding board. So I would highly encourage you not to do it alone if possible.

The Marché du Film “Basement Dwellers”

At Marché du Film 2018, I took meetings with whomever would have one with me, and this inevitably included what I refer to as the “basement dwellers.” If you haven’t been to the Marché du Film, it’s the below ground level of the Palais des Festivals where the sales agent booths are the cheapest. You are literally and figuratively in the film market trenches! Enjoy. Now, this is a generalization – there are very cool honest people in the basement - and believe me, “basement dweller” type folks are also on the upper floors.

Palais des Festivals basement entrance (Marché du Film press image)

But there’s a huge value in my opinion in having meetings with these folks, for one simple reason: they are the most likely to give you an offer. Now I’m not saying take the offer - definitely don’t. Their strategy is hope you are seduced and flattered by them and you impulsively sign. But now you have an offer or two; now you can tell other sales agents you have offers; and most importantly, you can start to piece together the parameters of the negotiation you will have to eventually undertake with the sales agents you really want to work with. And remember, I’m a terrible bluffer. But now I’m not bluffing - I’ve got offers. It doesn’t matter if it’s from Rotten Kiwi Sales from Boca Raton – it’s an offer.

Once you build up your network, you can graduate from the basement (figuratively speaking) to the upper floors of the film market. For newer producers, it’s a rite of passage I don’t think you should try to skip. Our industry has mostly good people, but you need to watch out for a fringe that tries to take advantage of new filmmakers. That’s just a part of this business. So turn it into a positive and learn from interactions with them.

Do a Teaser/Trailer! The Real Luxury Position: Finish Your Film

In time for the American Film Market (November 2018), we had three minutes of partially edited work-in-progress footage (temporary/incomplete grading, VFX, sound design), but even with stunt wires visible in some of the footage, sales agents could begin to see the film taking shape and we began to receive more offers.

Discussing “The Company saved us all” scene

Ted Neeley (Old Man), Thijs Meuwese, Dave Mantel (David Oscar)

So over the course of Marché du Film (May 2018) and the American Film Market (November 2018), we ended up receiving eight credible offers. Even though Thijs was a relatively experienced filmmaker, a lot of sales agents wanted to wait until the film was completely finished, but that wasn’t an option for us because of investor and crew commitments.

Indie action films have to compete with studio action films with budgets many multiples higher. I estimate we could have received at least eight more offers if we had the luxury of waiting to complete the film, but we wanted to start pre-marketing at the European Film Market 2019 (Berlin) and wanted to sign with a sales agent before then. So plan to make a trailer early on in your post-process, or even while you are still shooting, to increase the efficiency of your interactions with sales agents before the film is finished.

Sales Estimates and Minimum Guarantees (MGs)

As part of an offer, you should also get territorial sales estimates. A sales agent might not offer them up at first, but be persistent and you will get them. We definitely required estimates to take any offer seriously. Sales agents provide three estimates for each territory: low/medium/high. Less reputable sales agents may give you inflated estimates to try to win you over, or refuse to provide you with estimates saying the market is too difficult to predict.

In both of these situations, run for the hills! Come on, these folks are selling films year-round, and if you did your homework, you are negotiating with sales agents that represent films of the same genre and budget level as yours. Surely they can take an educated guess as to where your film will end up. Of the eight offers we received, one agent refused to provide estimates, and another agent’s estimates were more than double the others. It actually gave me comfort that six sets of estimates were coming out more or less around the same level.

One word on the confidentiality of sales estimates: treat estimates with care. They are the sales agent’s proprietary market information, and shouldn’t be shared with competing sales agents, verbally or otherwise.

We weren’t getting any substantial minimum guarantee (MG) offers, and at our budget level, I questioned whether it was worth it anyway. With production stalled in 2017, we had about a €70,000 financing gap. If we got an MG for this amount, we would have seriously considered it. But the price of taking this money is that, in addition to the sales agent taking this financing off of the top of sales they make, the commission and marketing fee are likely to go up. But the MG offers we were getting were far, far less, to make it not really worthwhile. If you’ve experienced different I’m curious to hear it.

Kill Mode character posters: David (Dave Mantel) & Angel (Cyril Guds)

Run Your Production like a Business

And now some market intelligence, which is, of course, subject to the ever-changing market conditions of our industry. Please note these are aggregate ranges of estimates we received. For us, the estimates were coming out around $150/250k (low), $350/500k (medium), $750/900k (high), which I would say is pretty typical for a “no names” genre film. Don’t forget, these estimates assume selling all territories (which won’t happen), and you have to subtract marketing fees and commissions.

Advice I got from sales agents countless times, is if you want a good chance of making the budget back with a “no-names” genre film, keep the budget to $300k or less. The market doesn’t care what you spent. That syncs with the estimates above, taking into account sales agent fees and commissions. If your budget is higher, you have to do one of two things, or both, to run your production like a business:

• Get a “name” actor
• Finance a portion of your budget with soft money (grants, cash rebates, tax incentives, etc.)

Let the negotiations begin!

So what do you need to negotiate? Lots of things, but in my opinion there are three key items:

• Contract length (how long the sales agent has the license for your film)
• Marketing fee (the amount of film sales the agent takes off the top to cover their marketing costs – adverts in trade rags, cost of film markets, etc.)
• Sales commission (the percentage commission the sales agent takes for each sale)

These items are all over the map, as you will discover once you get some offers. From the more reputable agents, contract length can range from three to ten years, marketing fee from $10,000 to $50,000, and commission from 10% to 35%.

Here the basement dwellers come in handy again – use them to practice negotiating. Believe me, they are trying to use you, too.

Kill Mode sales kick-off, Marché du Film 2019, Raven Banner booth

James Fler, Michael de Silva (Raven Banner), David Grover (Falcon Grove)

One word on contract length. The gestation period of a film these days is short. A good sales agent can probably get most of the juice out of a film at three film markets over the course of a year. I don’t see a rationale for why they need a license for years and years. If you are a sales agent and disagree, please let me know why.

The shorter you can keep the term, the sooner you will get your film back to work with another sales agent, distributor or other counterparty (talent agencies are getting into the sales space), or try and exploit unsold territories yourself. Or maybe you’ll decide to stay with your current sales agent if you like their plan to continue exploiting the film. If the plan is: “let it sit in the catalog without any more marketing” I would pursue other options.

Keep in mind though, the sales agent will need the flexibility to make longer-term deals with distributors, and those deals will remain in place even if the term with your sales agent expires.

Who knows what new kinds of sales ecosystems may emerge in the coming years, and no one cares more about your film than you. One interesting development is that some sales agents are bypassing distributors in select territories completely and doing deals directly with regional streamers.

When negotiating, you don’t want to bleed your sales agent dry on the commission and marketing fee – you do want them to be incentivized to sell your film. Don’t get me wrong, negotiate hard on all of these terms, which you will have the flexibility to do if you have more than one offer, but my advice is leave a little juice in it for the sales agent, too.

After we agreed our deal with Raven Banner, one thing I thought of is to suggest a graduated commission scale, where once they achieve a certain sales threshold, there’s an uptick in the commission. Next time!

And please, have a reputable entertainment lawyer review the contract.

Get References

More important than all of the above is making sure you are working with a reputable sales agent. If you don’t know them well, get references. If you don’t know any producers that have used a sales agent you are considering, use IMDbPro to find producers that have used them, say two years ago so you can get an idea of how the sales agent reports and pays. If producers feel they got screwed, don’t worry they will have no problem letting you know.

You want to know:

• Did the sales agent achieve anything close to its sales estimates?
• Did the sales agent report accurately and in a timely fashion?
• Did the sales agent pay on time?
• Did the distributors they sold your film to report accurately and pay on time?

Do protect yourself from overstated estimates, I highly recommend you insist on a minimum performance clause, whereby the sales agent must achieve a certain level of sales (a percentage of their minimum estimate) in a certain time period, or the film reverts back to you. Any reputable sales agent should be willing to agree to this. If you are willing to pay for it, using a collection agent can make reporting and payments more transparent.

Kill Mode character posters: Cassidy (André Dongelmans) & Richard (Burt Rutteman)

Don’t Fumble the Ball on the Goal Line!

In all, I probably met with about 50 sales agents over the course of three markets. Was it overkill? I don’t think so. We are talking about the culmination of a lot of blood, sweat and tears over seven years. I didn’t want to be the person fumbling the ball on the goal line. And I increased my network by a huge amount.

We kept a spreadsheet up to date to track the status of all of our discussions and relevant deal terms from the various offers, which came in extremely useful in negotiating the deal.

Of the eight offers we received, I would have been comfortable taking five of them. As you know, we eventually went with Raven Banner. I got to know them over the course of a few film markets, and they gave me the time of day when I was learning the ropes – stuff like that goes a long way for me.

We’ve been pleased with their advice and they’ve been doing a great job. Did we make the right choice – we will never know for sure. You just have to be confident that you did your homework and made the most informed decision you could.

More Layers - You Have No Idea!!!

One of the offers we got was from a sales agent that is also a U.S. distributor. Disappointed we didn’t go with them, I got an email: “More layers – you have no idea!!!”. That’s true because we didn’t do a U.S. deal directly, our sales agent takes a commission from U.S. sales. For us, this was outweighed by the confidence we had in them that they could negotiate a better deal for us than we could on our own from the Netherlands. Maybe next time we’ll do the U.S. deal ourselves.

Marché du Film, Cannes 2019 and Beyond

Sales started in earnest in Cannes last year. Our goal was to have the entire film finished in time for Marché du Film 2019, but post-production was taking longer than expected, and it’s hard to push your team when they are working for deferred pay!

Thijs made a business-to-business trailer that was a big hit with distributors.

The film was finished in July 2019 and Raven Banner has been making sales since then. To date, they’ve made about 20 sales.

To coincide with the U.S. release, RLJE made a B-to-C trailer that we really love. I encourage you to watch the B-to-B and B-to-C trailers back to back to get an appreciation for the difference.

American Film Market, November 2019, Raven Banner sales booth

Michael de Silva (Raven Banner), David Grover (Falcon Grove), Michaelangelo Masangkay (Raven Banner)

Investing in Your Future

It costs time and money to go to film markets, no question. Once you build up a base of industry contacts, I think it’s possible to do more business without traveling. I’ve built my network to a point where I could negotiate a deal from my office, but I wouldn’t have had that confidence 18 months ago. If the Marché du Film is totally cancelled, go to the next market that’s not. I’m remaining optimistic and staying in touch with my Airbnb landlord.

If you want some advice on if the time is right for you to approach sales agents and which ones might be right for your film, don’t hesitate to drop me a line.

We are a people business more than most - that’s what I love about it. Having a beer at a networking session, discussing film, seeing what’s selling, what’s not… you never know who you'll meet. I, for one, bumped into RB and Amanda Toney from Stage32 by chance waiting at the bar at a reception in Cannes in 2018.

If you’ve made it this far, thanks for reading. Let’s keep the conversation going, support each other and keep on making films!

About David Grover

American/British film producer/screenwriter/actor living in the Netherlands. CEO of Falcon Grove Productions, a Dutch-based Film and Television production company specializing in low budget genre films.

Here’s the link to the Kill Mode Amazon page. If you have the time to watch the film, the Kill Mode team will be grateful. Reviews on Amazon, IMDb, and iTunes are always appreciated. 

If you want to stay updated on Kill Mode progress and our other projects, you can subscribe to our newsletter at: www.falcongrove.com, and follow us on Twitter, Facebook, and Instagram. 

Questions for David? Email him at david@falcongrove.com!

Links to other films referenced in this article: 

Magistratus: Overtura

Molly Trailer

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