Production Financing

Payroll Advance Financing

Provide short-term payroll financing for local film/TV productions, enabling them to meet cashflow needs for crew and talent payments, while generating fee-based income and strategic leverage for The Collective.

Core Model: Payroll Financing Facility

How It Works

  • The Collective advances funds to cover local payroll (crew, cast, vendors) for approved productions.
  • Productions repay The Collective from confirmed receivables (e.g., distributor advances, grant tranches, tax rebates, or investor drawdowns).
  • The Collective earns interest or service fees, and may negotiate preferred supplier status, equity options, or profit participation.

Revenue Streams

Source Description
Financing Fees Flat fee (e.g., 2–5%) or interest (e.g., 8–12% APR) on advanced payroll amounts.
Processing/Admin Fees Per-payroll run fee (e.g., $250–$500) for handling calculations, compliance, and disbursements.
Equity/Profit Options Optional conversion of fees into equity or backend points in the production.
Preferred Vendor Agreements The Collective secures future service contracts (e.g., post, rental, distribution) in exchange for financing.
Training Rebates Productions using member apprentices or trainees may receive discounted financing, funded by grants or public incentives.

Eligibility & Risk Controls

Production Eligibility

  • Financing only applies to local crew payroll.
  • Must have confirmed receivables or contracted revenue (e.g., grant, MG, tax rebate).
  • Must pass a viability review (budget, schedule, legal structure, recoupment plan).

Risk Mitigation

Receivables Assignment
The Collective is assigned rights to incoming funds (e.g., grant drawdowns, distributor payments). Completion Bond or Insurance
Required for larger productions. Caps
Max financing per project (e.g., $100k–$500k); max exposure per year. Reserves
The Collective maintains a contingency reserve (e.g., 10–15%) for defaults.

Operational Flow

  1. Application & Approval
    • Production submits budget, financing need, receivables schedule.
    • The Collective Board reviews and approves based on risk and strategic fit.
  2. Payroll Processing
    • The Collective either disburses funds directly or provides direct payroll services to production.
    • Local crew/talent are paid on time, improving reputation and retention.
  3. Repayment
    • Funds are repaid from incoming revenue (e.g., grant tranche, distributor MG).
    • Optionally, repayment may include equity or backend participation.
  4. Reporting & Compliance
    • The Collective tracks disbursements, repayments, and impact metrics (e.g., jobs created, local spend).

Strategic Benefits

  • Revenue Generation: Reliable fee income from short-term financing.
  • Industry Development: Enables more productions to start and finish on time.
  • Talent Retention: Ensures local crew are paid promptly, reducing churn.
  • Leverage: The Collective gains influence over production standards, sustainability, and inclusion.
  • Pipeline Growth: Financed productions often return for post, distribution, or training partnerships.

Example Terms (Illustrative)

Term Value
Advance Size $25,000–$250,000
Term Length 30–120 days
Interest Rate 10% APR or 2.5% flat fee
Admin Fee $300 per payroll run
Equity Option 0.5–2% backend participation (optional)
Repayment Source Assigned receivables (grant, MG, rebate)

Optional Enhancements

  • Green Production Incentives: Lower fees for productions meeting sustainability standards.
  • Diversity Bonuses: Rebates for inclusive hiring or member apprentices.
  • Bundled Services: Combine payroll financing with post-production or distribution support.
  • Digital Platform: Online portal for applications, disbursements, and reporting.