Skip to main content

Don Cheadle's crowdfunding campaign for a Miles Davis biopic (called Miles Ahead)

Yesterday, Don Cheadle's crowdfunding campaign for a Miles Davis biopic (called Miles Ahead) closed and was successfully funded with $343,496. He is one of quite a few Hollywood celebrities that have gone to the crowd to raise funds for a project. Spike Lee and Zack Braff are in that number as well. Both of them hosted successful campaigns. However, there are several celebrities that had unsuccessful campaigns like Melissa Joan Hart and James Franco. Most of the campaigns are film-related in nature. There has been much concern from the public as to why these celebrities would even think to go to the crowd for funding. Some have even gone as far as to say that it is downright criminal. We don't believe this is completely true.

Crowdfunding at the heart of it is a concept that has been around for many years. The civil rights' movement was essentially crowdfunded. The idea is that everyone rallies together for a particular cause and contributes as much as they can to support that cause whether that be $10, $100 or more. The use of technology has simply given growth to that idea allowing people from all over the world to be a part of something they believe in. Crowdfunding has even evolved into an alternative funding source for startups and small businesses thereby democratizing funding they were not getting before. This extends to every industry including film.

For Spike Lee's Kickstarter campaign he answered the question as to why he, "an established wealthy filmmaker," would look to Kickstarter to fund a movie by saying, "I'm an Indie Filmmaker and I will always be an Indie Filmmaker. Indie Filmmakers are always in search of financing because their work, their vision sometimes does not coincide with Studio Pictures. But I do put my own money in my films." In essence, he is merely using the same method he has always used. Zack Braff said the same thing about maintaining creative control in his crowdfunding campaign.

These celebrities are simply using the solution that crowdfunding provides: democratization of funds. They want the people to have a part in creating films they want to see made regardless of who makes them. This doesn't take away from the unknown indie filmmaker who wishes to do the same thing. If anything it should validate the crowdfunding method.

Comments

Popular posts from this blog

Crowdfunding Accounting 101 - Revenue Recognition in Crowdfunding

A start-up using crowd funding to create a product is different from a normal company. The start-up has cash inflows from donations but does not have a product, yet. In this situation, we recommend using completed-contract method to recognize revenue. Under this way of thinking, we assume the start-up is akin to a project or a long-term contract. The crowdfunding company will find it difficult to estimate the revenue from crowdfunders and, hence, the cost of rewards or perks. Under International Financial Reporting Standards (IFRS) and GAAP guidelines, if the firm cannot reliably measure the outcome of the project, revenue should be recognized based on contract costs. These costs should be expensed when incurred. Profit is recognized only at the completion of the project. In summary, for crowdfunding companies, revenue, expense, and profit are recognized only when the crowdfunded product is actually manufactured. 1 For example, assume that AAA Corp. wants to manufacture bicyc...

Top 50 Crowdfunding Campaigns: Fifty Most Successful Crowdfunding Campaigns

  Top 50 Crowdfunding Campaigns: Fifty Most Successful Crowdfunding Campaigns Kindle Edition https://www.amazon.com/gp/product/B00RKK4NL0/ref=dbs_a_def_rwt_bibl_vppi_i0

Top 50 Crowdfunding Campaigns

The chart below results from an analysis of the Top 50 crowdfunding campaigns on Indiegogo, 'Top' measured by total dollars raised. The X axis shows the dollar amount of the reward or  perk ($1 to $10, $11 to $20, etc.) The Y axis shows the cumulative number of rewards/perks collected across all 50 campaigns, so the chart shows that, for the top 50 crowdfunding campaigns on Indiegogo, 100,000 rewards/perks with a  value ranging from $1 dollar to $10 dollars were selected by supporters.  Normally, we might expect this chart to be convex, declining steadily from $1 to $5000. This is not what we see, however. It seems that people are willing to donate small dollar amounts, up to about $50, and then contributors look to donate at least $100. What's going on here? To explain this phenomenon, classify backers into two categories: 1. The first category are people who simply want to help. They donate less than $50 dollars and do not donate for the reward (normally a T-shi...