Film-Tech Forum ARCHIVE: Theatre's Kickstarter Fundraiser

This is topic Theatre's Kickstarter Fundraiser in forum Ground Level at Film-Tech Forum ARCHIVE.

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Posted by Michael Putlack (Member # 6523) on 07-22-2012, 09:14 PM:

Faced with some of our studios cutting 35mm film prints, my two screen independent theatre is turning to the community to get our upgrades. I know there has been a lot of discussion on when studios will totally dump film, but Fox Searchlight told us Q2 2013. This was also our plan B. Plan A was a small business loan, and banks wouldn't have any of it.

So, here it is, we're about 16 days in with 14 to go and still need to raise $89,000. The Patio pulled it off a $50,000 campaign to upgrade, and I seriously believe we can do it too! For instance, if our 4,500 each donated only $34, we'd make enough and then some.

Also, a lot of people in the community are really stepping it up to help us out. For instance, we were able to trade a private party for $20,000 worth of billboards in town, a farmers market donated a booth, a business association is holding an "Emergency" cash mob for us on Thursday, a local t-shirt company is printing our backer shirts for just the cost of materials, a world renowned web comic volunteered their services, a very popular bluegrass band, Head for the Hills, is playing a concert for select backers, New Belgium Brewery is donating kegs to our after party, and a local filmmaker made us a pretty great kickstarter video.

If you guys have any thoughts or suggestions, I'd love to hear them. Also, we have some pretty rad rewards even for people who don't live in town, so if you feel so inclined...

Here is the link:

http://kck.st/Nu3jaN

Posted by Bill Enos (Member # 440) on 07-24-2012, 12:14 PM:

Major money will NEVER come from the public or from events that raise at best a few hundred or a thousand bucks. You will have to visit the well moneyed people in your area and convince them of the value your project has to the community. If you're not non profit it will be very difficult.

Posted by Mike Blakesley (Member # 26) on 07-24-2012, 02:17 PM:

You have a problem from the get-go because the general public sees news reports every week talking about how the new movies 'raked in' $65 million dollars, or the theatres 'take' was such and such, or how theatres make a 95% profit on popcorn and other nonsensical crap. So your moviegoers think you are swimming in money already even if you're not playing mainstream fare.

I'm always very happy to discuss how much movies cost us to play, the cost of equipment, how often we have to replace our $1000 bulb, what we paid for the popcorn machine, etc with the public. They're always stunned to find out the expenses we have and it makes them realize we're not just a bunch of money grubbing bastards.

Posted by Scott Norwood (Member # 30) on 07-24-2012, 02:37 PM:

Rather than begging for money from the general public every decade (or however often the [dlp]

equipment becomes obsolete and needs to be replaced or significantly upgraded), wouldn't it be more honest just to raise prices? After all, the cost of doing business as an exhibitor just went up, and this is not a one-time expense. Even if the beg-for-money approach works this time, it probably won't work again in the future, which has the effect of just delaying the inevitable.

Has Fox Searchlight really made an official statement about the end of print availability? So far, the only source for the "2013" date seems to be NATO. And NATO does not distribute films.

Posted by Michael Putlack (Member # 6523) on 07-24-2012, 03:21 PM:

We heard directly from a searchlight rep that it would be second quarter of next year.

We do raise our concessions prices once or twice a year, but that just doesn't add up to enough to cover the costs of this kind of an upgrade with the amount of business we do.

And Bill, it certainly did work for the Patio!

Posted by Mike Frese (Member # 4361) on 07-24-2012, 10:59 PM:

quote:
And Bill, it certainly did work for the Patio!

Did it? They are closed this week with a broken air conditioner and the owner started a thread on another theater biz forum asking whether or not they should go non-profit. Hmmmmmmm.......

Posted by Kurt Zupin (Member # 2751) on 07-25-2012, 03:50 AM:

Everyone on here saying how its not going to work, So far they've garnered over Seventy thousand dollars. I would think that's pretty damn good, and that isn't including the events that they have coming up.

I say good luck and keep trying, you gotta do what you have to do to stay in business.

Posted by Bill Enos (Member # 440) on 07-26-2012, 04:30 PM:

The 70 grand is only the tip of the iceberg. Next will come 80 grand for the boiler, then the seats, then the plumbing, electrical, etc. etc. How many times can you bleed the public with out giving them a charitable donation receipt? As a non profit the owner gives control to a board of directors, which even if comprised of trusted friends will quickly get out of control and take things its own way.

Ft. Collins is a vastly smaller population area than Chicago and digging out $70,000+ will be a lot more difficult.

The Patio is a real show place, and its closure would be a loss to the community, can the same be said for an older 2 screen?

Sorry if this comment seems harsh but it is reality.

Posted by Ron Funderburg (Member # 4561) on 07-26-2012, 04:43 PM:

You should try with GDC to see if they will do the fiance on it.

Posted by Steven J Hart (Member # 2340) on 07-26-2012, 09:11 PM:

We raised around $86,000 to go digital at the Roxy Theater in Langdon, ND last summer. It took about 5 months. The Roxy is a 501c(3) non profit. Our town's population is around 2000, so the public dug pretty deep to help keep the theater operating.

Posted by Mark Hajducki (Member # 1732) on 07-27-2012, 10:09 AM:

quote: Bill Enos
Ft. Collins is a vastly smaller population area than Chicago and digging out $70,000+ will be a lot more difficult.

I don't think the size of the town or city will have a huge impact on the amount donated. A large city will have lots of cinemas already operating, and lots of other causes requesting donations. The amount of love for the venue within the local community is probably more important.

Some of the local theatres and cinemas have "donation" charges added to the ticket price to cover the cost of refurbishing the building, sometimes alongside other fundraising activities. The donation charge is sometimes compulsory. The companies that do this are for profit and would have acquired their buildings knowing the state they are in and the investment required.

I would expect a business to plan for future investment needs, the change to digital has been expected for many years now so there has been plenty of time to start accumulating funds.

Posted by Ron Funderburg (Member # 4561) on 07-27-2012, 11:28 AM:

How many theaters are in competition with? According to what I see on the net the population is over 100,000 at Ft. Collins that should be large enough for a theater to get VFP.

Posted by Mike Frese (Member # 4361) on 07-27-2012, 01:18 PM:

quote: Mark Hajducki
Some of the local theatres and cinemas have "donation" charges added to the ticket price to cover the cost of refurbishing the building, sometimes alongside other fundraising activities. The donation charge is sometimes compulsory. The companies that do this are for profit and would have acquired their buildings knowing the state they are in and the investment required.

As soon as you make it a mandatory charge, you have to report that to the studios and pay film rental on it. The best one could hope to do is to call it a suggested donation.

As far as competition goes, a quick google search shows a Cinemark, Carmike, & an AMC in town. The Lyric seems to be playing the arthouse films which it probably should. VPFs are not as easily available for this type of theater.

Posted by Mark Hajducki (Member # 1732) on 07-27-2012, 03:00 PM:

The "donation" taken by the cinema is optional, but requires the customer to ask to have it removed at the time of purchase. The staff don't actively ask whether the customer wishes to contribute.

The live theatre has a mandatory "restoration levy" included within the ticket price. This seems to be increasingly common in UK theatres, I don't know how this affects the box office percentage paid to the performing group.

Posted by Caleb Johnstone-Cowan (Member # 3710) on 07-27-2012, 07:15 PM:

An optional restoration levy is the way forward, I guess if you could catalogue your efforts in a newsletter or blog it would also give people a regular pay-off for their initial contribution.

Mark, I just got back from two days in Edinburgh for work. Popped in to have a look at The Cameo who have a restoration levy, you can see how the money from theirs has been well spent, it looked great.

Posted by Mark Hajducki (Member # 1732) on 07-29-2012, 09:27 AM:

I still find it a bit odd being asked to make a donation/investment to a (venture capital) owned company (for a family or charity owned venue it would seem more reasonable).

Strangely the only local (live) theatre which seems to have a compulsory refurbishment levy is the commercially owned one (who's owners have almost 40 sites nationwide). It has also received substantially less refurbishment compared with some of the other historic theatres.

Posted by Mike Blakesley (Member # 26) on 07-29-2012, 12:22 PM:

Every business has a "refurbishment charge" built into its prices. It's all part of the profit generated. Some businesses just "call it out" where others would just add a dollar on without stating a reason. The first way is good when a sudden (or substantial) price increase needs to be justified with the customers.

The only thing is, if you have a "refurbishment charge" called out in your prices, you darn well better be doing occasional refurbishments! [Smile]

Posted by Michael Putlack (Member # 6523) on 07-29-2012, 03:14 PM:

quote: Mike Frese
As far as competition goes, a quick google search shows a Cinemark, Carmike, & an AMC in town. The Lyric seems to be playing the arthouse films which it probably should. VPFs are not as easily available for this type of theater.

We also have a successful 2 screen drive-in in town and a 14 screen Metropolitan Theatre close enough to draw business from the south of town.

It looks like another theatre, the Catlow in Illinois, is trying this too, and they've already met half their goal in just a few days!

Posted by Mike Frese (Member # 4361) on 07-29-2012, 07:05 PM:

quote:
It looks like another theatre, the Catlow in Illinois, is trying this too, and they've already met half their goal in just a few days!

$100,000 to convert one screen. Does that seem to be a bit high to anyone?

Posted by Steve Guttag (Member # 268) on 07-29-2012, 07:40 PM:

The final number all depends on just what is being done. For instance, we did a twin art-house and that was about what it was. BUT...they wanted projectors with a 4K upgradable path...they wanted Dolby 3D on one, they wanted to keep film on the other (with changeovers, no less) and there had to be alternate content scalers on each screen to deal with their wide and varied alternate content sources (picture and sound). Due to the nature of the booth...most of the cables were cut/fabricate on site and pull through conduit. Keeping the film meant that they needed an electrician to pull in new power/conduit, HVAC to add another exhaust with a possible roof penetration...and the list goes on.

If it was just a typical mall-plex conversion to the cheapest thing that does the job...then yes, it can be much less than 100K/screen...but when you want flexibility and you don't get to reuse existing infrastructure (and even the sound was upgraded)...you are going to tiptoe up into that 100K mark, pretty easily...once you add everything up.

There is another aspect...the installation doesn't go nearly as fast as a typical plex (as in about twice as long). For singles/twins and even triples...the load-in/out is a much larger portion of the total installation cost than when you get into the real multis.

Posted by Michael Putlack (Member # 6523) on 07-31-2012, 06:25 PM:

To update everyone, we're just under $114,000 with 6 days left in the campaign! I totally think we're going to make it!

Posted by Bill Enos (Member # 440) on 08-07-2012, 07:23 PM:

I.'m amazed. About those "donation charges", if you collect them with the ticket sale it will be considered part of the price by the distributors and you will have to include it in the percentage owed. If you are not non profit it's taxable income. There are no non taxable "donations" to a for profit.
Better ante up on the tax on that $114,000 or the IRS and your state tax departments will be knocking on your door.

there are no

Posted by Ben Mozer (Member # 3401) on 08-09-2012, 03:31 PM:

Hey Bill,

You just seem to know everything don't you? We ended up raising over 170k on Kickstarter in memberships (discounts on tickets and beer), advertising, merch, and fun, non-taxable services. Income tax needs to be declared but I will have spent the money on capital expense before the end of the year. You skepticism was, perhaps, previously warranted, but I will guarantee that just because you know a lot about projection doesn't mean you know my business or my city.

Posted by Frank Cox (Member # 6258) on 08-09-2012, 03:46 PM:

How do the film companies handle discounts on tickets via such things as "memberships" anyway? Do they get a percentage of the presumably paid membership fee? How is it calculated and allocated between the different film companies?

Posted by Mark Hajducki (Member # 1732) on 08-11-2012, 06:03 AM:

quote: Bill Enos
I.'m amazed. About those "donation charges", if you collect them with the ticket sale it will be considered part of the price by the distributors and you will have to include it in the percentage owed.

If it is (truly) optional then this would not be an issue as it would be the same as selling a popcorn or similar. How much this has to be disclosed to the customers at the time of purchase is up for debate.

There is a (charitably run) visitor attraction that gives the customers the option of treating their donation as a donation (for no difference in cost). For UK taxpayers the charity is able to reclaim the income tax (25%) paid by the customer.

I wonder how this would work for a cinema, even if just on membership schemes?

Posted by Scott Jentsch (Member # 1681) on 08-17-2012, 05:36 PM:

I have to admit that I was quite skeptical about the chances of theaters being able to raise the funds they were looking for on Kickstarter. I did think that it was a novel way of raising funds, as it was a way to keep people from shelling out the money even if the entire goal wasn't reached (like they would with direct "save this theater" donations).

A quick look shows that the Lyric in Fort Collins, CO, the Catlow in Barrington, IL, and the Patio in Park Ridge, IL all met their goals! Color me suitably impressed...

Of course the cynical part of me fears that the donations won't have a lasting impact and the theaters end up closing anyway. I hope that's not the case, but I've seen it happen.