Digital Revolution: Funding a Feature with NFTs
Interview with Miguel Faus
Spanish filmmaker Miguel Faus made his first appearance at Aesthetica Film Festival in 2021 with Calladita, the story of a Colombian maid (Paula Grimaldo) working in Costa Brava for a wealthy family. Now he intends to turn that short into a feature, financing it through the sale of NFTs (non-fungible tokens). The first European film to embrace this growing digital revolution, Calladita already has the support of actress Emily Mortimer, who will appear in the feature. Faus explains what is behind this unique scheme – one that could have a huge impact on the way independent movies are financed.
ASFF: How does selling NFTs to raise money for a film differ from something like Kickstarter?
MF: I think it’s a lot better. With Kickstarter, it’s very clear that the backers are donating money towards making the film. In exchange, they might get memorabilia like a T-shirt or a poster. But this has two problems, in my opinion. The first is that it carries a lot of cost for the creators, right? So there’s a misalignment: you are donating money to see a film made, but a portion of that money is being used to send you something, it’s not going to the film. And then you [probably] don’t really want the T-shirt! So it’s sitting there and you’re not doing anything with it. With NFTs, those two problems are solved. NFTs cost barely anything to make and send to all of the backers. As they are digital mementos rather than physical ones, they retain a certain remnant value. They’re a lot easier to resale and to trade.
ASFF: Has there been an example of NFT film funding already?
MF: There’s only been one feature film [Keepers Of The Inn] ever funded this way. It’s by Julie Pacino, who’s the daughter of Al Pacino. She did something similar to what we’re doing, and now she’s an advisor in our team. She sold 3,365 NFTs and, right now – one month later – they are trading on the secondary market at half the price that they sold. You might think: “That’s not a good investment.” First of all, we don’t call it ‘investment’, because that’s not allowed legally. But imagine you were able to put $100 to help fund a film and, a month later, you’re able to retrieve $50 from your donation. That would already be a big improvement on the Kickstarter model. If the film is successful, and becomes the next cult movie, then it could be worth a lot more. We don’t like to emphasise that point, because we are not selling an investment. We’re not telling you that you’re going to get rich by buying our NFTs. But there is a chance that the value might go up if the film is successful, both artistically and commercially.
ASFF: How does selling NFTs to raise money for a film differ from something like Kickstarter?
MF: I think it’s a lot better. With Kickstarter, it’s very clear that the backers are donating money towards making the film. In exchange, they might get memorabilia like a T-shirt or a poster. But this has two problems, in my opinion. The first is that it carries a lot of cost for the creators, right? So there’s a misalignment: you are donating money to see a film made, but a portion of that money is being used to send you something, it’s not going to the film. And then you [probably] don’t really want the T-shirt! So it’s sitting there and you’re not doing anything with it. With NFTs, those two problems are solved. NFTs cost barely anything to make and send to all of the backers. As they are digital mementos rather than physical ones, they retain a certain remnant value. They’re a lot easier to resale and to trade.
ASFF: Has there been an example of NFT film funding already?
MF: There’s only been one feature film [Keepers Of The Inn] ever funded this way. It’s by Julie Pacino, who’s the daughter of Al Pacino. She did something similar to what we’re doing, and now she’s an advisor in our team. She sold 3,365 NFTs and, right now – one month later – they are trading on the secondary market at half the price that they sold. You might think: “That’s not a good investment.” First of all, we don’t call it ‘investment’, because that’s not allowed legally. But imagine you were able to put $100 to help fund a film and, a month later, you’re able to retrieve $50 from your donation. That would already be a big improvement on the Kickstarter model. If the film is successful, and becomes the next cult movie, then it could be worth a lot more. We don’t like to emphasise that point, because we are not selling an investment. We’re not telling you that you’re going to get rich by buying our NFTs. But there is a chance that the value might go up if the film is successful, both artistically and commercially.
ASFF: Are all the NFTs priced the same for Calladita?
MF: There are four tiers. Each tier is more expensive than the previous one. As the tiers progress, you’ll get an NFT that is more exclusive, because there are less of that kind. Similar to Kickstarter, each tier has their own perks. For example, you can put your names on the credits. Or, if you go to tier number four, you can put your avatar in the credits, or have an associate producer credit – things like that. Tier number one, for example, is the cheapest one: there are 2,300 NFTs. They are still images from the short, which has 92 shots. What I’ve done is take 25 frames out of each shot, all unique. We’re selling all of those 2,300 stills as NFTs; it’s random which one you get.
ASFF: You obviously had a short already. What if you’re funding a film with no pre-existing images to send buyers? How does that work?
MF: There are many creative ways to bypass that. It’s true that in our case we were lucky to have the short film – that makes things easier. But, for example, Julie Pacino didn’t have a short film. What she did is go to the location with a few actress friends, rehearse the whole film, act out the scenes and take photos. She’s a photographer as well. So what she was selling was photographs from those sessions. You could essentially create a designer token that is the same for everyone: a placeholder before you get the finished stills from the feature. That’s possible as well.
ASFF: Do you think this willbecome a common film funding method in future?
MF: Yes, I do think that this model is going to be huge for indie filmmakers in the future, just as Kickstarter was when it launched. Crowdfunding has been big for indie filmmakers, but this is ten times better, in my opinion.
Words: James Mottram
