10 Tips to Get Financing for a Film Project

For entrepreneurs with not much experience under their belts, the most obvious place to obtain a business loan might not be the place to go. 

1. Bootstrapping

With bootstrapping, entrepreneurs launch their businesses using as little external capital, such as loans, as possible. The funds come from either personal finances, such as selling assets, using savings or credit cards or from using revenue from the business once it gets going. 

This is a very lean method of running a business, as entrepreneurs find the least expensive way to make a viable product or service. 

If you do choose to empty your savings or use credit cards to fund your business, be careful because there is no guarantee the business will pan out.

2. Crowdfunding Platforms

Due to the rise in popularity of sites such as Indiegogo and Kickstarter, crowdfunding sites have become a more mainstream way to gain capital for a business, service or product. 

Here’s how it works: Entrepreneurs and small business owners create a 30-day fundraising campaign seeking investors in the company or project instead of going to a bank for money. 

Usually, business owners reward individual investors with some kind of gift, product discount or, sometimes, equity in the company. 

3. Product Pre-Sales

An easy way to acquire funds if you’re operating a small business selling products is to hold a pre-sale in which customers pay for goods up-front. The business owner can use the money raised to fund the manufacturing of the initial batch of products. 

4. Friends and Family 

Friends and family may be a potential source for financial capital for your small business, but be warned: If the business doesn’t make it or falls on hard times, it might destroy the personal relationship.

5. Partners

Taking on a business partner can be a way to secure funding in exchange for equity in your company. Depending on the arrangement, the partner might be an employee, someone not involved with day-to-day operations or just an investor.

If you are considering taking on a partner, write down every detail of the business partnership, preferably with the help of a lawyer. Define clear expectations and boundaries of what each partner can expect while running the business and worst-case scenarios of how the business would dissolve in the case of a partner dying or wanting to be bought out of the business.

6. Small Business Grants

Small business grants come from a variety of sources, including government agencies, nonprofit and for-profit companies. Government agency grants tend to have the most narrow eligibility requirements, as they often focus on businesses in the science, technology or energy industries that will bring direct growth to the community.

Grants from nonprofits may focus on specific types of business owners, such as women, minorities or veterans. Grants from for-profit companies often have the widest eligibility requirements and may be given out based on merit or by completing an application. 

Your local Chamber of Commerce may have information on small business grants available in your area. The only catch is everyone wants free money, so these grants can be hard to come by.

7. Angel Investors

Just as the name suggests, the idea of having a wealthy investor come in and fund a startup can sound like the answer to an entrepreneur’s prayers. Angel investors can be affluent people or groups looking to fund startups.

Once you find a potential investor, it’s a long, thorough interview process with the entrepreneur and that person’s entire business team to make sure the business is viable. 

8. Venture Capital

Similar to angel investors, venture capital firms also provide funding to small businesses and startups early on in development. The difference is the speed with which they operate and what they ask for in return. But that speed comes at a price.

If you think your business may be of interest to such firms, start by asking your network for personal recommendations. You can also opt to make a profile for your business on AngelList — a national platform for job seekers, angel investors, entrepreneurs and venture capitalists alike. 

9. Online Alternative Lenders

Online alternative lenders have become a popular business financing option versus getting capital from traditional bank loans. Online alternative lending companies, such as KabbageOnDeck or BlueVine, are a convenient and fast way to get funds. There is no need to go to a bank to apply as everything is done online and funds can be deposited in a couple of business days. 

Just like loans, online alternative lenders also offer business lines of credit, where instead of providing one lump sum of money up-front, you can use as much or as little as you need within your limit. 

10. SBA Loans & Banks

The U.S. Small Business Administration has a program to help business people get financing after they demonstrate success for a few years. SBA loans come with a guarantee that the loan will be repaid to the lender. If the business fails to pay back the loan, the government will pay the lender, which could be, for example, a traditional bank. 

The only catch is these loans are rather difficult to obtain for startups. If your business is a couple of years old and generating good revenue and is close to a profit, then it’s a much more viable option for a small business loan. You can go to SBA.gov to find out if you qualify for an SBA loan.