The amount an individual investor contributes to the short film project.
Total Raise for Short
The total amount raised from all investors for the short film project.
Additional Raise for Feature
The additional amount raised to produce the feature film.
Feature Film Total Revenue
The total gross revenue generated by the feature film.
Cost Percentage
The percentage of the feature film's revenue that goes towards costs. This is a simplified
representation of the complex cost structure in film finance.
Timeframe
The number of years over which the investment return is calculated.
Adjusted Net Profits
The feature film's revenue minus costs (Total Revenue * (1 - Cost Percentage)).
Recoupment
The amount of the initial investment returned to the investor, including a 10% premium if fully
recouped.
Additional Investor Share
The investor's share of any profits after full recoupment, based on their proportion of the total
investment.
Bonus Share
An additional 5% of the investor's share, taken from the managing members' 50% of profits.
Total Return
The total amount the investor receives (Recoupment + Additional Investor Share + Bonus Share).
ROI (Return on Investment)
The percentage return on the initial investment over the entire timeframe.
Annualized ROI
The average yearly return on investment, accounting for compound growth.
Note on Model Simplification
This model simplifies the complex financial structure of film production. In reality:
Production costs (including the "Additional Raise for Feature") are spent before any revenue
is generated.
Revenue is typically allocated in a specific order: distribution fees, marketing costs
(P&A), residuals and participations, recoupment of production budget, and then profit
sharing.
The "Cost Percentage" in this model is a simplified representation of these various
deductions from revenue.
Actual film finance often involves more complex calculations and agreements.
This simplified model provides a useful approximation for educational purposes, but
real-world film finance scenarios may differ significantly.