Few questions must to be asked:
1. What is your goals?
What you want to reach, what niche on market you see undermined, what your long and short term goals? Many questions.
Most of the independent “production companies” started to release single movie and then dissolve. It is done, cause the business entity signs all contracts and holds all liabilities (before the investors, SAG-AFTRA/other guilds, latter is often the reason to dissolve company etc), so as soon as goals are reached it is cease to exist.
2. Do you have access to the quality resourses?
Resourses in this business are: investors/finances, writers/screenplays, crew & cast, technical resourses.
If you have access to the good screenplay (better few), you have very good chances to find finances and/or went into co-production with someone who see your resourses (screenplays for that matter) valuable. Or you know talented director, who can bring value, but struggle with financing of his ideas.
Main thing is: find the way to access the best resourses possible!
3. Are you sure you know the business?
Do you think that your movie earns money by theatrical release? Yes, it does. For distributors. That’s the reason they purchase the rights for distribution of your movie.start a film production house as soon as possible.
Money you make are in sales! U.S. & Canada (domestic), International (rest of the world but some countries rights can be sold separately), TV distribution, VOD (Netflix, Hulu etc), DVD, Pay-per-View, streaming and every other rights. Plus supporting products licenses and whatever your imagination can produce. Also, you can make money by decreasing your expenses: I’m about tax rebates and incentives. They too can be sold in some countries (ex.: company purchases $100,000 worth tax reduction; this means company gives you $100,000 that they were supposed to pay as the taxes).
Actually, it is more than that. But you’ll figure it out on the way. What you need to know now: Just do it!
And about the steps:
- Put some effort in your business plan and strategy. What movies you want to produce, what business niche you want to occupy in this industry, what is you goals, resources and actives you want to capitalise on. Determine your short term goals and set the first project.
- Find out legal requirements of your country. Maybe consult with attorney, who’s qualificated in this area of business. Fill the paperwork.
- Find the accountant. He can work part time, even few hours a month. This will cost you anywhere from $200 to few thousands dollars per month. But it might save many more, which is important if you’re intent to be in business for more than one movie.
- Start work on the first project. Develope it in great details and start to pitch it to find financiers. If you have backing from some investors already, make sure you’ll bring the value by it.
- Make sure you have strong marketing! Marketing makes difference in this industry! Your projects and your company should be marketed well. Plus it will help with sales.
- Find the way to reduce expenses on production as much as possible via tax incentives. Contact the film commissions (if there any in the area you planning to shoot) or other structures thatare responsible for governing such things to help you. Find the most cost-effective place to shoot the movie.
- Make sure you’re present on every more-less important film festival and event. Some might be costly, but they can make all the difference. Network with other producers, directors and writers. This will give you access to the better resourses we already talked about.
And continue doing all the same but better and more effective. When you’ll get used to that, you’ll see that everybody doing simple steps. But better. So will you.
After you start a film production house. Every success is build on mistakes. You’ll do yours. Losers – those who refuse to do, to avoid mistakes. Winners – those who had courage to make every single mistake they need to win. I wish you all to hear your names as the names of winners one day.
Register a Company
It is always advised to convert your business into a legal entity. Every country and state allows different company formation structures for business owners. For example, if you are from the United States, forming an LLC will give you relief in case your company is in trouble . in many accounts. Check with the local appropriate authorities about the licenses and permits required to run a film production company.
If you are looking for funding, it is critical to have a well-planned document for presentation to potential investors. Creating a detailed business plan is the key to impress financers. Angel investors, Government financing, crowdfunding are some of the alternate ways of getting money for your business. You can also talk to companies and seek brand sponsorship from them.
Broadly, you need to hire four kinds of professionals for your film production company. You need scriptwriters, production specialists, post-production experts and sales and film marketing personnel. Create a job description for each work and recruit the best you can get. You can hire these people from recruitment agencies, post job adverts in local newspapers.this basic requirement to start a film production house.
You have to carefully invest in procuring proper equipment for film production. Equipment like camera and camera support like tripods, sound equipment, lights and reflectors, editing software, etc.
Create a Film Distribution Strategy
If you are into the movie business, the most important aspect is the film distribution strategy. It is observed that most make good movies but unable to distribute their product properly. If you are serious in making a profitable film production business, creating a well-planned distribution strategy. If you can afford, hire professionals in this field who can reach distributors effectively with your product.