A quick look at how a movie makes its money back.
Investor puts up $100,000
Distributor spends $40,000
“First Money” - The first $174,000 goes to to the investor and
distributor:
Investor gets $100,000 plus 20% - $120,000
The distributor get $40,000 plus 10% plus their 25% overhead
fee - $54,000
The filmmaker gets nothing - which is why you want to put a salary
into the budget.
“Second Money” - Once the movie makes $174,000 the percentage
agreement kicks in. Let’s use a profit of $100,000.
If you’re very skilled at business and make a deal in YOUR favor the
numbers might look like this:
Distributor takes 40% - $40,000
Filmmaker takes 60% - $60,000
Of that $60,000 - called the producers gross - you first pay all deferments
and then points. So if you have offered 10 points to the investor they
get $6,000. If you owe cast and crew $20,000 in deferments and a total
of 20 points ($12,000) you end up with $22,000 for every $100,000
the movie brings in.