Crowdfunding with a Capital C: It’s Future in Hollywood

In North America, crowdfunding volumes grew 105% to $1.6 billion dollars in 2012 and grew 65% to $945 million in Europe. According to the report, volumes are expected to exceed $5 billion by the end of this year.

(Download the latest free Massolution report here.)

The numbers are expected to rise, at least in North America, especially with Obama’s Jumpstart Our Business Startups Act (JOBS) coming into effect in the 2013-14 period. This act enables startups to pitch and advertise investment opportunities to individuals and could pave the way for equity crowdfunding (where backers are given a small piece of the pie).

There are films you probably didn’t know are being crowdfunded right now. In the past few months, several Hollywood projects have received buzz for their use of crowdfunding websites to raise a portion, if not all, of their required costs. Here’s a list of the most talked about or most high-profiled in chronological order:

A film adaptation of the TV series Veronica Mars, which starred Kristen Bell as a private investigator, broke all Kickstarter records in March after smashing its $2 million goal in merely ten hours and then amassed over $5.7 million in contributions from people in over twenty countries. Rob Thomas, the creator and executive producer of the series, called his campaign “our shot. I believe it’s the only one we’ve got. I suppose we could fail in spectacular fashion, but there’s also the chance that we completely revolutionize how projects like ours can get made.”

In April, Zach Braff launched his own Kickstarter campaign for his indie pic, Wish I Was Here. With a cast of Kate Hudson, Mandy Patinkin, Anna Kendrick, Jim Parsons and Josh Gad, Braff managed to raise over $3 million in thirty days. “Everyone was like, ‘Oh my God! Congratulations! That’s insane! I can’t believe it worked! No one thought it would work,’” he commented upon the news of his successful fundraiser.

Criminal Minds actor, Shemar Moore, used Kickstarter in June to enlist financial support for his rom-com, The Bounce Back. But after failing to raise enough money, Moore moved his campaign to Indiegogo, another crowdfunding website, and surpassed his goal by a hundred thousand dollars.

James Franco wanted to get in on the action and in June, joined Indiegogo as well to fund three films based on his book, Palo Alto Stories. According to him, the goal is to “give very talented young filmmakers the shot they deserve at making movies.” The actor also said that all proceeds from the movies will be given to The Art of Elysium, a charity.

Spike Lee’s untitled film, described as being about “human beings who are addicted to blood” was crowdfunded in July and fellow director, Steven Soderbergh, even pledged $10,000 to his campaign on Kickstarter.

Keep in mind, though, that artists you may have never heard of are raising hundreds of thousands of dollars. Films, inventions, causes and socially responsible businesses are sprouting.

Despite seeming so effective, CFPs have gotten mixed criticism recently. The high-profile cases listed above received a lot of social media backlash. In response to the possibility of a Veronica Mars movie, writer/director Joe Swanberg questioned the logic behind crowdfunding to his followers on Twitter.

“So Warner Brothers (who owns the rights to Veronica Mars) just put themselves out of business,” he tweeted. “If the audience can pay to create the movies they want, we don’t need studios anymore, right?”

Unknown filmmakers aren’t thrilled either. Having to share the generosity of backers with those already established in Hollywood, according to them, is unfair because they have a presumed advantage to accessing funds.