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What South African Film Producers Need to Know About Film Finance
Welcome, everyone!
Ladies and gentlemen, welcome to a brand-new episode of The Blade Podcast—your go-to show for everything related to video production, post-production, and marketing. This is episode 12, and I’m excited to be back!
If you’re watching this on YouTube, you’ll notice we’re doing things a bit differently today. I’m both recording video and producing this podcast, so welcome! My name is Lunili, and let’s dive in.
Reflecting on the past year
I hope you’ve all had a great year. Before we get started, I want to acknowledge that 2020 was a tough year for many—people got sick, lost jobs, and faced many challenges. I sincerely hope 2021 is a better year for you, that you grow personally and professionally, and that your hustle continues to thrive.
Today’s topic: Film Finance
In this episode of The Blade, we’re talking about something very important: money—specifically, film finance. More precisely, we’ll be discussing what South African film producers need to know about funding their films.
Having been in the industry for over 12 years—since 2008—I’ve learned a lot about filmmaking and producing. I recently had the opportunity to pitch a project to a government organization, where I gained a wealth of knowledge about film finance. I wanted to break it down for anyone looking to understand how to finance a film in South Africa.
What is Film Finance?
Film finance is essentially your strategy for raising funds for your film. It involves a detailed breakdown of how much money you need and where you will obtain it from. A complete finance plan, including necessary documents and treatments, is called a film package. This package is what you present to broadcasters, investors, or government organizations to secure funding.
I’ll break this down in my own way. I’m not an expert, but I’ve learned quite a bit. If you already know how to put together a film finance plan, you might not need this episode. But if you’re new to this, stick around!
Key Elements of a Film Finance Plan
Before you can put together a film finance plan, you need to do a few things:
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Complete your script – You need a finished script before anything else.
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Assemble your creative team – This includes your director, producer, writer, cinematographer, editor, and any other key personnel.
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Budgeting – Determine the rates for all team members and compile a detailed budget.
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Production schedule – Plan out each phase of production: pre-production, production, and post-production.
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Cast attachments – If possible, get a well-known actor to sign a Letter of Intent, indicating their interest in your project.
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Film package – Compile all documents, including the script, budget, schedule, and team details.
Funding Sources in South Africa
Unlike Hollywood, South Africa doesn’t have major film studios like Warner Bros. or Universal. Instead, funding primarily comes from government organizations and private investors. Here’s how you can secure funding:
Step 1: Secure a Film Distributor
The first step is to approach a film distributor and present your project. If they’re interested, they’ll give you a Letter of Intent, stating their willingness to distribute your film. This is critical, as many funding organizations require this before committing funds.
Step 2: Apply for Government Funding
You can seek funding from organizations like:
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National Film and Video Foundation (NFVF) – They may fund up to 9% of your budget.
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Provincial Film Commissions (e.g., KwaZulu-Natal Film Commission) – Similar funding opportunities exist.
If your budget is R3 million, for example, securing 9% from the NFVF would give you R270,000.
Step 3: Apply for the DTI Rebate
The Department of Trade and Industry (DTI) offers a rebate of up to 35% on your total spend in South Africa. However, this rebate is only paid after you’ve completed the film, so you will need to cash flow it through another source.
Step 4: Approach the IDC for a Loan
The Industrial Development Corporation (IDC) provides loans covering up to 49% of a film’s budget. This is a loan, meaning you will need to repay it once your film generates revenue.
Step 5: Cash Flow the DTI Rebate
Since the DTI rebate is only paid post-production, the IDC can help cash flow this amount. Once the rebate is received, you can use it to repay the IDC.
Step 6: Defer Producer Fees or Use Owned Equipment
To further secure funding, producers and directors can defer part of their fees. Additionally, if you own production equipment, you can list it as part of your financial contribution.
Summary of a Film Finance Plan
For a R3 million film budget, a possible finance plan might look like this:
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9% from NFVF/KZN Film Commission = R270,000
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35% from DTI Rebate = R1,050,000 (cash-flowed by IDC)
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49% from IDC loan = R1,470,000
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7% from deferred producer fees/resources = R210,000
Once all funding sources are in place, you can proceed with production, complete your film, and start generating revenue to pay back investors.
What If You Can’t Get a Distributor’s Letter of Intent?
If a local distributor is unwilling to provide a letter of intent, you can approach international distributors. Keep trying—film financing is difficult, but persistence pays off.
Final Thoughts
Film financing is all about convincing investors that your project has value, will generate revenue, and that you have a solid team to execute it. It requires meticulous planning, proper documentation, and strategic pitching to funders.
I know today’s episode was quite technical, but I hope it helps you understand how to put together a film finance plan. If you have any questions or want me to break down any specific topics further, leave a comment, email me, or reach out on social media.
If you enjoyed this episode, please like, subscribe, and comment—it really helps! Until next time, stay safe and keep grinding. Peace out!