This has to be the least-fun-talk we could possibly talk about when it comes to financing and marketing your films.
But the process of drafting video production contracts for you and your videography clients is essential, and today, you're going to learn how to draft said contract, quick, painless, and easy as can be - or you can use the one below.
Because you're going to do client work. Lots of it in between projects.
Adjust your attitude and treat each as an opportunity to grow in the areas of:
All of which the Christopher Nolans of this world do for a 10-figure film (box office yield).
Want to impact the world and share the message of hope? Adjust your attitude!
NOTE: This post is a beast.
Bonus: buckle up, and if you're around long enough (the vast majority of you will interact for about 24 seconds before leaving), I've got a solid video contract template for you to use at the end of this post.
Make sure you read through it before using it though. The odds are stacked against you that you too live in Clark County, Nevada.
Neh-va-duh... say "va" like you would "vat."
Secondly, I'm not a motion picture-savvy lawyer. Everything I share here is what's worked for me and cannot be taken as sound legal advice. Take responsibility for your work. Use discretion and add or detract as necessary. This is ideal for the solopreneurs working with the businesses, nonprofits, and churches in their backyard, not E! or ABC.
FIRST, A RABBIT TRAIL
Lately, I have been really drilling down and figuring out what niche audience - what crowd - I am serving.
And that's you, the microbudgeter.
You can go anywhere for film stories, tech know-how, and YouTube how-to videos. Caleb Wojcik (DIY Video Guy) is one such site for all things DIY video and film, and if you haven't checked his blog out, you need to today.
But you come here for financing and marketing your microbudget films.
Because without those two (underrated) tools, your film will FAIL.
I know; I'm living proof. I shot a microbudget feature film in the summer of 2013, and I didn't know a thing about marketing.
When I started full-time self-employment, I had big pie-in-the-sky aspirations and I still do.
You need to have that big goal, and that's important.
But lately, after trying and trying and trying to find an audience, I realized it was too broad when I first started. Originally, I wanted to get a quality visual gospel into the hands of every man, woman, and child, and that's a good, noble goal, but it's so big nobody can get behind it, not even me.
If I can't get behind the vision, no one else can. (See Addendum at the bottom.)
So after niching down further, I realized that my work is really about teaching people how to finance (in the pre-production phase especially) their film and then also market their film (in every phase).
Both of those areas (financing and marketing) were areas that I was lacking in when I shot my microbudget feature. Badly.
The reality is they are areas that you are probably lacking in because they're not fun; they don't have the sizzle, pop, and glamour that shooting a video has. There are countless tutorials on YouTube for how to shoot a video or how to be a filmmaker. You can literally go to the school of Google and YouTube University and learn how to shoot a film and be a good filmmaker without ever dropping a dime on film school - but to really grow, you have to learn how to negotiate budgets.
You also need to learn a little bit about marketing your film.
Let's say you're just a run-of-the-mill videographer. For you, this is just as applicable because you need to be able to learn how to negotiate a budget and ultimately what your fee is - it's no different than what James Cameron said about being a director: A director is someone who tells a story, and at the end of the day, he is no different than you are because you both do the same thing - you negotiate a budget to go tell a story, and then you have to negotiate what your fee is from that budget.
So if you're the run-and-gun videographer or the casual video girl or guy, what that means is you have a budget that you have to work with: it's your client's budget, and after taking away the expenses in the creation of that video for the client, you have your gross profit, from which you'll cover your fee and operating expenses. We'll possibly get into that in a later post (the difference between gross profit and net income).
For the longest time, I didn't know that they were different!
But they are! They're not the same thing, and so if you're learning how to do the business side of film, we'll get into those nuances.
If you are doing contract work to pay the bills to raise funds for your shorts (or feature) or for whatever reason (like... hmm... I don't know... living), then you need to always have a good solid contract ready to go and adjust as needed.
I started off in video years ago, and I made a lot of rookie mistakes.
I still make mistakes.
I learned the hard way what needs to be included with every contract that I send. In no particular order...
If you are responsible for developing the script, spell out how many revisions you'll do. Charge accordingly.
Also, very clearly spell out how you will co-create this story with your client. I propose you write a script, then the two of you must schedule a time to rap about the script after they've read it, and they must come with detailed notes.
I had a client once ask for a shot of the main character in a hospital - long after we had signed ink and there was no hospital in the original story. My budget wouldn't accommodate one either. I found a work-around with stock footage, and it was ultimately thrown out after watching the first cut, but it was a hard-lesson learned: scripts need to be signed off before production starts. If your client doesn't spell out their hopes and dreams early on, they will hate your final product, and you'll likely never serve them again.
The first thing that you need to consider is a watermark.
Clearly state in your contract that you're going to have a watermark in every video that you send to this client.
The Watermark is to protect you so that the client does not run off with the video, being a digital asset, until you are paid.
In your contract, you need to have a clause that says "every cut (every draft) that I send to you will have a watermark until considerations are made."
Note: consideration is just legal mumbo jumbo that means payment. You want to get paid, and you won't get their final draft to them - you won't get any draft to them without a watermark - unless you are paid. That's to protect you from piracy and just as bad, chasing accounts receivables (AR) 90 days after the work's been done.
You don't want that.
The frivolous and the frugal both will sit on their money. It's cash for them to use (ever notice why your bank, Paypal, and others all take their sweet time getting your money to you?). So do yourself a solid and avoid chasing AR.
Make sure that watermark business is in writing (i.e. in the contract), and of course once they've agreed and signed, then you're good to go.
Don't start work until the contract is signed; do not start production until the contract is signed.
2. PAYMENT TERMS
The second thing you need to clearly spell out are the payment terms.
If your client's going to be paying with credit, you need to explain to them what their options are - you need to explain that they can use PayPal, that they can use Square, or that they can use Stripe, etc.
Whatever it is you're using, then spell that out. Tell them that there are no refunds, there are no partial refunds, etc.
Tell them that you expect to have payment in full before the work starts or you need to have half of the payment made upon the completion of production (or start).
If it's a small project, you have more flexibility, but if it's a larger project, you need capital upfront!
If you're just doing the post-work, say you're just editing somebody else's work, then you need to definitely have a deposit at the beginning of the job, but if you are doing the job from pre-production all the way through post-production, then you need to have half of that payment made the first day of shooting. And you have them agree to that in the contract, and the balance is to be remitted at any point thereafter.
Going back to the watermark idea, they have incentive to pay.
In case you missed it before, you don't want to be chasing accounts receivables. You're not big enough to do that; you don't have an accounting team to do that for you, and so with the watermark, they have a real good reason to pay.
The Watermark I used to use was just a big giant text overlay on the video:
Sometimes, it's smaller.
They're not going to want that. Nobody does, so put yer name on that there video of yers. If yer name is Uncle Bob, then use UNCLE BOB as a big giant overlay on yer video.
Another big thing you need to be looking out for are the number of revisions.
Your client will take you to the town with this if you don't spell this out. Tell 'em you are providing a maximum of two revisions, so they'll get three drafts. After the third draft, or the final draft, there's no going back - there is no additional work that you're going to put into the video. At that point, you wash your hands and tell them you find no fault in the video.
You have to make this super clear to them, otherwise you will beat your head against the wall because they will ask for the littlest things, and at that point, you might wish you weren't listed on Google+ or Yelp.
More often than not, you should adopt a policy that they are allowed no more than two revisions. Smaller projects should only have one revision. Anything above and beyond that is just you over-delivering, which is isn't a bad idea. Use discretion.
I tell them I'll send them the video; they can make any changes that they want and note them because I'll put those revisions into the second cut of the video, and usually they're good at that point. If they still feel like something's off, then they have one more chance to get it right.
4. TIME (EXTRA DAYS)/LOCATIONS
So that you two can agree on what the finished product will look like, you also need to spell out in your contract how many extra days you allow for shooting.
That's a biggie.
Tell them that this is something that you require payment for: any extra services above and beyond the terms listed in the contract (and in the separate invoice) will incur additional charges.
The same goes for locations. Remember my hospital example. After reviewing the script (whether theirs or yours), spell out how many locations you'll shoot at in your contract, and go the extra mile and reinforce that number with a pen if you must.
You need to spell this out because they don't understand what goes into making a video; they have no idea. They don't understand man-hours, subcontractors you'll need, or locations you'll need to wrangle. They just assume it's a breeze for you to just come on over and grab some B-roll at Sears.
Like Jon Acuff says, they'd rather you work on spec.
And as Acuff points out, does your plumber work on spec? Heck no.
They think it's that easy to come on over and grab some b-roll.
Translation: come work for free - pretzels and tonic are are on us.
It's not like you have a family or anything better to do. Aren't video guys kind of like video gamers anyways?
I hate to say it, but sometimes clients just see you as a novelty act, and that they're doing you a solid, or best case scenario, they think you're a historian that's responsible for archiving their latest show of force, annual retreat, or other bloated, self-aggrandizing ceremony.
Don't you love company write-offs?
To them, you're already working to tell their story; they may have already paid you. So why wouldn't you be there to capture those 40 minutes of self-serving homilies?
Bottom line: you need to spell it out that extra shooting days will incur additional charges.
Even if it's only a 3-hour block where they want you to come and hang out at the company party and take some video of the CEO, the CMO, and all these big suits, then you need to tell them any extra days above and beyond what is spelled out in this contract will be charged the full day rate of 12 hours.
They need to be aware of that very important clause, and once it's signed, that's it.
Stand your ground here; don't let them try to wiggle out some extra charity because everybody wants cheaper, quicker, and better, but the reality is you can't do that. You may have people that rely on you for work, and you have a family (even if it's just you and Milo) to feed, and you have films and stories to tell. That's what God put on your heart to go and do: tell authentic, engaging stories that are going to remind people there's hope.
You're never going to reach that point or that platform where you can impact a multitude of people (millions if not billions) and lead large crews to carry that story to the masses if you don't have the grit to just say NO.
"No" is your friend.
Scared of turning down someone who needs your help?
Try this: I'm not going to help on this one; I need to honor my other commitments.
Simple. Hey, Bob Goff is a big fan of "no," and he says he quits something every Thursday.
You need to have an arbitration clause - in everything. Heck, tattoo it on your arm.
I learned this from the Score guys downtown (check them out for free mentoring, yes, even you the microbudgeter).
This is so you can avoid costly court fees and the need for costly lawyers.
Arbitration is something I've never been involved with thankfully. But it's so useful, I even include that clause even on my Dunkin' Donuts receipts.
Nobody's ever taken me up on arbitration - thank God. I don't have time for spats, and neither do you, which is why you want the arbitration clause.
It's very simple: you include a clause saying that you will have all disputes and conflicts resolved by binding arbitration in Clark County, Nevada.
If you're not in Clark County, Nevada like this guy, then adjust.
If your client is in the same county as you, great - that makes it easy on them. If they're hiring you for work, and they're completely out of state, then they're probably not going to be inclined to take you up on this process.
Everything legalese points to arbitration being a much cheaper, much quicker, and just overall easier way to settle disputes.
Hey, in case you skimmed to this point, make sure you include an arbitration clause. It's the most important clause you can include, above and beyond everything else, and if I've overused that superlative (most important), please forgive me, but binding arbitration is the whole enchilada.
P.S. look into errors and omissions insurance (commonly known as E&O), if you haven't already. Because of worker's comp laws, every state will have small mom and pop insurers who can take on the little guys like you and me. They be harder to find than Rotel Tomatoes in a Wal-Mart, but they are there. State Farm won't touch you 'til you have some serious muscle behind you.
In your invoice you need to make sure that you clearly spell out if the music that you will be using in this video is good for commercial use.
If you license your music from the Musicbed, and if your client has absorbed the cost of that, then hopefully you agree to their (Musicbed) terms, and by that I mean you've licensed something from the Musicbed that is good for web, internal, and external settings.
Just go ahead and assume your client will need all three. Let me break them down real quick:
1. Internal Use - This turkey is pretty simple; it's just like the name suggests. A good example is you have a bunch of suits at the company, 20-50 of them or however many employees. They get together in a room, and they huddle around the projector 20 minutes after the meeting was supposed to start. The lights dim, and they watch the video that you were commissioned to make but half of them are checked out, thumbing through emails, eating scones, sipping coffee, and you know, the usual waste of money and manpower that companies love to do because they still haven't figured out what a meeting should do or look like; they just follow what other companies do. (Seth has a lot to say about this.) That's an example of internal use, sans the rant on meetings.
2. External Use - Know how all the companies at a trade show have their booths set up and they play their 30-second spots on repeat for all the people that pass by? That there be an example of external use sonny. Word to the wise: external use (by Musicbed standards) does NOT include broadcast use or paid advertising.
3. Web - well, you know this one.
These are the three options that you will need to check on your checklist of different licensing options when you go to the Musicbed. Of course, your clients are going to absorb the costs of these.
But if they're too cheap, or if it's a small mom-and-pop shop or some other small business downtown that just doesn't have the wiggle room for licensing music, then you need to spell out that you will be using music that is free to use commercially.
You can scour the usual places like the YouTube Audio Library or the Free Music Archive (FMA) or other places to find music, but I would explain (not only in writing but also verbally to your client) that by using this kind of music, you are limited in your choices.
The music that you get from the "free" sites is just that: it's free because it's limited. I use free music all the time because I have clients that just don't have the room to find and license a good quality track that costs as much as their video does because they want to dump some ad dollars on it. So we make do with the public domain or the attribution-free music that is available.
Another idea: I do not list how many days I'll be shooting for the client on my contract.
I have that on my invoice that I have automatically generated through my Instant Quotes Calculator - this way they can see how many days they're getting me for, and each day is defined by two 6-hour blocks.
They get me for a half-day? That's one six-hour block. They get me for one-and-a-half days? They're going to get me for a 12-hour day and a 6-hour block.
This is so that they know anything above and beyond that will be charged the full extra day and all the rates that go with it.
I have all that in the invoice, and one of the clauses on my contract states that everything that is listed on the invoice is what they will get in their video service. Again, everything above and beyond is extra, but I do recommend that you over-deliver. Always. Not only is the attitude of the best servant leader to have ever walked this earth, but it's the best attitude that you can adopt.
Want to tell a big story to a lotta people that will move them to action? Be a servant leader.
The other thing that you should consider listing on your invoice, and I realize this post is about contracts, but the invoice goes hand-in-hand with the contract (it really does), is you should be very upfront and clear about the discount they are getting.
Your nonprofit is getting a 10% discount.
I always suggest charging a full rate for a for-profit company. Because nonprofits and churches work with leaner budgets and leaner manpower, and because they have a different mission than that of their for-profit counterparts, I recommend these discounts:
- If it's a church, you should offer a flat 20% discount.
- If it's any other non-profit, then I suggest a flat 10% discount.
Clearly state this discount on your invoice.
The reason you want to do this is because nonprofits and churches will try to discount every penny that they possibly can - and that's fine. Let them try. Negotiations and opportunities to haggle build grit. You need grit and loads of it.
But know this: most nonprofits and churches are understaffed and under-resourced beyond your wildest dreams.
If they are paying you for work, however, then you need to be firm that the discount is already being applied. This gives you bartering power and a position of strength to communicate with them.
Lost in the sauce? Keep it simple:
"Sir, I'm discounting the service 10% because you are a nonprofit, and I believe in what your group is doing in Las Vegas."
Have an answer ready because I promise you, they're going to ask for that discount. Shoot, for-profit groups will ask too.
I've often said this, especially lately in the webinars: you need to only take the nonprofit work or church work that pays you.
It's different if you want to go to them and volunteer your services because you agree with their mission. That's a different ball game entirely. But when they ask you for free work, you need to politely decline.
You have responsibilities, and you will never grow as a filmmaker if all you do is free work. The guys that do commercials for GE like Diego or the Coen Brothers of this world didn't get to where they're at by doing work that didn't pay the bills or their crews for that matter. At some point they had to learn how to level up so that they could manage larger teams with larger budgets to reach larger populations.
It's pretty simple here.
"No budget" means you have a very poor chance of reaching multitudes of people. If our whole mission and focus is to take our gifts as storytellers and tell people about hope, forgiveness, redemption, or grace, then we have to level up. Go back to the parable of the talents. Write it down somewhere you can see it every day and then take a picture of it, and email me when you have done it.
Dave Ramsey suggests including clauses on the following "in the event of" type of situations:
- Death - what happens to the agreement if one of you guys dies?!
- Destruction - what happens if someone wreaks havoc?
- Default - what happens when one party fails to live up to the agreement? The other party should be able to terminate the agreement or exact some kind remuneration where applicable.
- Disability - ditto someone gets hurt.
In his book Entreleadership, Dave goes through several more, including natural disasters and extreme moral shortcomings (e.g. one of the contracted parties starts abusing substances). I highly recommend going through his book for this section on contracts alone, not to mention the other chapters on running/leading a team (essential for us as we grow as filmmakers).
Dave also reminds people to sign as an officer of your company (if you have one) rather than as yourself to limit your liability (in the former instance, the company is the contracted party, in the latter, you're putting yourself at risk.
Put everything in writing that you and/or your client wants in the video. Spell everything out, from aspect ratio (is it 16:9 or 4:3?) to resolution to which services you are including and not including. There are more ideas of what to spell out for your client here.
Firehose of info?
Raise your right hand, and repeat: "I can do this."
If you need some inspiration, go read the story of Esther, Frederick Douglass' story, James Dyson's story, or Seth Godin's, or Henry Ford's, or Eisenhower's, or Phil 4 - whatever you gotta do.
If you're tired of having to scramble to find the invoice to send to your clients, if you have no idea what to charge them, and if you kick yourself for underbidding your services, then I came up with a tool for that, and the name is pretty darn simple: Instant Quotes Calculator.
This is a tool that I developed over many, many, many hours and years of rookie mistakes to crunch all the numbers that you need to give your client in the first conversation for 90% or more of your jobs that you run into, from a wedding to a slideshow to a corporate video to a church video to a crowdfunding video - it has you covered.
It allows you to enter your rates and give them an instant quote and invoice right there in the first conversation, even if they have to fly you out of town.
It will start generating some numbers for you to carry out their vision and account for your crew and your talents. This is so they (your client) can have the peace of mind of a flat rate, right then and there and you guys do not waste your time any longer (never offer them hourly rates).
If they're too scared to hire you because of your price, be firm and confident in your abilities and please, charge what you're worth.
Now here's your bonus: to make it easy on you, I'm going to share the contract that I use with my video clients, and you can download it here (below).
Even if you're just doing this video stuff on the side, be ready to jump. You need to have a good set of written terms for you and the client to agree on, and this one's worked really well for me and my clients.
It's based off of the video production template at docracy.com, and I did my due diligence: theirs is in the public domain, so if you want to save yourself the time and the hassle and the headache of going and finding a form off Docracy and then modifying it to include these terms we talked about, you can go ahead and download this contract.
I also put together a 4K-ish, behind-the-scenes video on CudaSign (Now SignNow), which works really well for sending documents and getting digital signatures.
If you've never used SignNow, it's several bucks a month as of 2017 (can try hellosign if you're starting out) if you're going to be serious about your video production. The time and heartaches it will save you with contracts, signatures, and bugging people for those signatures make CudaSign, er, SignNow invaluable (I was grandfathered in through CudaSign).
To get in on all of the goodness, download here:
Original post: May 6, 2016; updated July 3, 2017, June 8, 2018
ADDENDUMFor all of you budding filmmakers, write down one audience that you want to reach.
I know. I used to say this was my target audience because I do want to see every man, woman, and child have a quality visual Gospel in the palm of their hands that's not cheesy, that's not poorly acted, that's not another "God's Not Dead" production, etc.
It's just too big, and the only one that can reach that many people is the Almighty.
Not bad, but it's still too broad. It's not about the numbers, it's about the specificity.
See the difference? You need to figure out what your audience is. Then write that down. Your film, whether a feature film or short film, needs to serve that audience. It's no different than any business, nonprofit work, or church - figure out your niche!
This is my audience right now, and it took me the better part of 18 months to figure it out and what to do for them:
Be specific. Have a clear mission for what you want to accomplish.
Equally important is vision or the "why."
Why do you do what you do?
In fact, this should go before the mission. My why is simple:
That's why we do what we do. The what is our mission. Like Simon Sinek says in his flagship book, start with WHY.
Here's your homework: figure out what your vision and mission are, or your WHY and your WHAT, and write them below. Then put them up somewhere that you can see them every day. This is important! If you can't see these, you will not grow as a filmmaker!
Lost in the sauce? Simon Sinek has a free tool on his site that will help you figure out your why. Get to it!