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Summary:

Movies are kind of like startups. They’re risky ventures typically funded with other people’s money — and most are duds. But a new production company called ZDONK hopes to be a blockbuster in both the business and film worlds. Here’s the pitch. ZDONK has access to […]

zdonkMovies are kind of like startups. They’re risky ventures typically funded with other people’s money — and most are duds. But a new production company called ZDONK hopes to be a blockbuster in both the business and film worlds.

Here’s the pitch. ZDONK has access to scripts floating around Hollywood and will make them available on the site, where the ZDONK community can purchase shares in an entity set up to create the film. Once the financial requirements for the films are met, the film gets made. If the film doesn’t meet those requirements, then all funds are returned to the investors.

The company is focusing on comedies that can be made in the $3-8 million dollar range. Anyone can buy shares in the film project and will be a participating owner in the intellectual property (yes, setting up such a system required a lot of due diligence with the SEC). Investors have no creative input into the film but get in on the upside should the film do well at the box office, with DVD sales or any merchandising.

According to Roy Klabin, ZDONK’s chief digital officer, the company wants small investors who feel ownership of the film and will promote the film actively in their respective communities.

ZDONK will have a stake in the film project, reserving secondary revenues (after box office, DVD and merchandising) for itself. The company will also charge an underwriting fee for purchasing shares.

There’s also going to be a social network for creative professionals on the site, connecting directors and writers and actors and so forth. I’m not sure the world needs another social network, but ZDONK believes this add-on is a natural extension of its movie-making endeavour.

ZDONK was founded 8 months ago and currently has three employees. It received $1 million in financing and will soon be going out for a second “small” round that it will use to acquire scripts. Joe Roth, former Chairman of Walt Disney Studios and CEO of Revolution Studios sits on ZDONK’s board. ZDONK plans to officially launch in April.

The boys at ZDONK aren’t the only ones trying to democratize Hollywood. Indievest also lets people pony up to pay for indie films, but is only open to accredited investors.

While crowdsourcing the cost of a movie seems like a novel way to get funding, especially in these tight times, it will take a lot of people to get a project funded, especially if they are going for the smaller, unaccredited investor. If the average person gave $500 (which isn’t chump change), ZDONK would need 6,000 investors. Sure, you can get tons of people to fund Obama’s presidency — but a feature film other studios probably rejected?

Oh, and in case you are wondering, a zeedonk is an actual animal. It’s a cross between a zebra and a donkey. Here’s a picture.

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  1. This dog won’t fly.

    They are counting on Investors reading a script online (a 2 hour process) and then sending in a cheque? Independent film finance is complex and generally results in losses. If they were funding a slate of projects rather than individual projects the Investor would be better served.

    But, are there really any investors out there, in this market, for something like this? Not in my neighborhood.

  2. Did All These Fledgling Video Startups Not Get the Memo About the Crappy Economy? « NewTeeVee Thursday, December 11, 2008

    [...] brands and web stars. Meanwhile, this week my colleague Chris Albrecht profiled the launches of ZDONK, an online film financing community, and First on Mars, a premium video content [...]

  3. Perkins’ 14 Movie Made with Help from Fans | Real Big Firm Tuesday, December 23, 2008

    [...] Coelho to put together UGC elements for his upcoming film The Experimental Witch. An upstart called ZDONK will be fully up and running in April, as well, with the goal of letting users invest in small [...]

  4. Zdonk to offer film scripts for investment, ownership and professional production | Enter Venture Tuesday, December 30, 2008

    [...] and at this point, their idea has been picked at from every angle.  Just ask Chris Albrecht of NewTeeVee, who takes a look at the hard economics of actually funding a movie online — 6,000 investors [...]

  5. Olga Kostrova (IdeaMama) Tuesday, October 13, 2009

    Sorry to say, totally wrong business model, guys. No compliance with the law whatsoever. :-)

    1) Zdonk can only solicit accredited investors; the idea to involve public in investing is very old. We have done it 5 years ago. Then security commissions (SEC etc.) comes and say “We don’t care about your great intension and have no intension of changing the law to fit your innovative business models”. It’s not allowed to market ANY investment opportunities to the public.

    It’s a nice dream, but…. illegal anywhere in the world where there is a system that protects unsophisticated investors.

    2) you will deal with IP law all the time as the community aspect that you are thinking of will infringe number of patents (some are ours LOL)

    There are also 2,3,4, but I will leave it at that…

    Here is my prediction. You will try your best and fail within 3 years, then take your assets and introduce a totally new business model, may be even new vertical application of your ideas…

    Please prove me wrong. I am easy to find :-)

  6. hope u r both wrong! i think it s a great idea and opens the door for many to be part of the movie itself regardless how small the amount. that s of course assuming the business model is possible

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