Once upon a time, sex sold—and so did ultra-low-budget movies known for their double-entendre-laden scripts, extreme depictions of raunch and violence, and lots of radioactive slime. Not so anymore. That’s why, on a crisp late-January afternoon, in a building in the Long Island City area of Queens, New York, the production staff at Troma Entertainment—“Almost 40 years of reel independence!” its proud motto—is shooting a promotional video for their first-ever campaign to crowdfund a movie. The camera rolls as Troma’s president and public face, Lloyd Kaufman, enters his office.
“We’re going to enter the nerve center of the Troma building, the reason that we’re still around and something the studios don’t have,” he tells the camera. “They do not have a young, intelligent and smooth-working work force like this, let me tell you.” He opens the door to a dozen actors and crew members covered in fake blood, drooling green ooze and simulating sexual acts with mutant-body-part props. This, apparently, is a normal work day at Troma.
Their current project—and the one that is the object of their fundraising efforts—is a documentary called Occupy Cannes. The idea is to rent a theater at this year’s Cannes Film Festival to peddle their new film Return to Nuke ‘Em High—it involves a mutant glee club—to international distributors, and bring along a film crew to capture the entire process.
“We can make a documentary that will show from the inside-out how this festival—and the very concept of a film festival—has been perverted,” says Kaufman. For that, he’ll need $50,000.
Asking your potential audience for the money needed to make a movie is no longer unusual, but it’s a new step for Troma. For nearly 40 years, they’ve paid for their movies themselves—often turning a profit. The building that houses Troma also serves as a prop warehouse, distribution center and film vault that contains over prints of more than 800 movies, going back to a 1969 student film by Kaufman. But the old model isn’t cutting it anymore, so the company turned to its fans online for funding. Kaufman says that there was no money left at all after Return to Nuke ‘Em High was made—and though Troma’s publicity director Justin Martell says that’s hyperbole, he confirms that there’s not enough revenue coming in to make Occupy Cannes the way Troma has done business before. Crowdfunding, apparently, is no longer just for up-and-comers. Here’s a legit, established business turning to a new model. So could Troma’s experience with crowdfunding, like the first mutant arm that emerges from a bucket of toxic waste, be the harbinger of the end of an old brand of independent filmmaking and the beginning of a new species of production company?
Here’s how it used to work:
Troma, founded in 1974 by Kaufman, 67, and his Yale classmate and business partner Michael Herz, made money. The movies created and distributed by the company—perhaps most notably 1983’s The Toxic Avenger—were produced on relatively tiny budgets, the money for which came from private investors and, later, when the company’s profits were more stable, from Kaufman’s and Herz’s wallets. They were purposefully contrarian; the back-story of The Toxic Avenger is that a Variety article about how horror movies were not commercially viable inspired them to make a horror movie. Their movies might not open in many theaters, but word of mouth would help them spread to cineplexes across the country and home-video sales would continue long after. A 1984 Forbes article about the company gave the example of an investor who put about $50,000 into a Troma movie—10% of the sample budget—in return for 5% of profits; that hypothetical person could reliably expect to double his money within four years. A Troma investor, Kaufman points out, was beating the stock market.
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A chunk of that profitability came from international distribution deals, many of which were struck at the company’s annual pilgrimage to the Cannes Film Festival. It was a ritual Kaufman started in 1971, when he rented a theater there to show his first 35 mm film, Sugar Cookies. “What little money we had I wanted to try to use for promotion, so I slept on the beach,” he recalls, “and went around advertising by putting leaflets on parked cars, right on the croisette.” Once the company started going to the festival, they became infamous for using street theater to attract attention to their screenings—you don’t have to be in the festival to rent a movie theater in the city—and in the late ‘90s would spend up to $100,000 putting the voyage together, a sound investment at a time when the festival was also full of indie companies looking to license Troma’s content.
They’ve even done the Cannes documentary thing before, with 2002’s All the Love You Cannes. But All the Love concluded with Troma’s expulsion from their local office space, and the company has not been a major presence at the festival since then.
And the changes don’t stop with the fact that, as Kaufman says, he would never in a million years be permitted to sleep on the beach at Cannes these days.
Some of the changes have been legal, Kaufman explains in his 2011 book Sell Your Own Damn Movie. Mid-century laws and regulations had opened the American media landscape to independent studios; the 1948 Supreme Court antitrust case U.S. v. Paramount Pictures, Inc., for example, barred the major Hollywood studios from owning their own movie theaters. The 1970 Financial Interest and Syndication Rules required similar decentralization on television, ensuring that there was room for independent production on network TV.
But deregulation has made vertical integration the rule once again. The FCC let the “fin-syn” rules expire in the early ‘90s, but Gus Hurwitz, a fellow at the Center for Technology, Innovation and Competition at the University of Pennsylvania Law School, guesses that the rise of reality television means it wouldn’t matter if the regulations were still around. Even if the networks had to buy independent programs, they would probably just buy low-cost reality content. And while Paramount stands, the type of vertical integration it addressed is now recognized by antitrust law as an efficient way to do business rather than a threat to competition. “Today, it almost certainly would not have been a successful case,” says Hurwitz, who notes that the Paramount agreement led at least temporarily to higher movie ticket prices and lower quality, which did make space for independents but didn’t necessarily benefit mainstream moviegoers. “Antitrust law is meant to protect consumers, not competitors. So even if Paramount made it easier for independent producers to get into that market, that doesn’t necessarily mean it was a good thing.”
Unless those moviegoers are Troma fans. The return to integration has meant that Troma movies are effectively gone from theaters and TV; Kaufman describes the current Troma status as “economically blacklisted” and refers to the media companies that dominate today’s movie-making environment as “cartels.” In all its years, Blockbuster never carried a Troma movie. At Cannes, Kaufman says, even though many of the movies that show there are very good, there’s no longer a way for an independent film to get noticed unless the filmmaker is a “vassal of the major media conglomerates” or a “puppy-dog favorite” of the elites.
“We could have Gone With the Wind and we wouldn’t be able to get anywhere,” he says.
To take an example: the 1981 Troma picture Waitress! played on 92 New York City screens; 2007’s Poultrygeist: Night of the Chicken Dead played on one, despite positive press in outlets like the New York Times (“it is just about as perfect as a film predicated on the joys of projectile vomiting and explosive diarrhea can be”) and tens of thousands of dollars spent on advertising. When Poultrygeist opened on May 9, 2008, it made over $10,000 in its one theater, clocking in at No. 2 in the country by that metric, according to Box Office Mojo. (Iron Man made an average of $12,452 in each of its 4,111 theaters.) On May 23, however, Indiana Jones and the Kingdom of the Crystal Skull came out and opened on what Kaufman remembers as every single screen in the theater, forcing Poultrygeist out of its single toehold, something that Kaufman thinks would not have happened if the relationships between distributors and studios and theaters were not so cozy. “In years past, however, the theater would have kept playing the film for a few weeks based on such a great opening, and we would have had plenty of opportunity to make that money back, as well as make some profit,” Kaufman writes in Sell Your Own Damn Movie.
“It made back not one cent. Lost every dime. And my wife and I had to put up the money,” Kaufman says of the film. (His wife is the long-time executive director of the New York State office of Motion Picture and Television Development.) “It’s my wife’s retirement fund. I told her she was investing in Transformers Part 6, so don’t breathe a word!”
In many ways, crowdfunding is an extension of what Troma has been doing for nearly 40 years. They’ve been ahead of the game on technology—early to have a website, and so early to convert to DVD from VHS that Kaufman says the lack of actual people with DVD players almost caused a financial crisis for the company—and have long used social media to foster a close relationship with fans. “The artists can’t exist without the fans, especially in a company like this,” says Aaron Hamel, Troma’s director of international distribution. “The only way we can keep them supporting us is to keep interacting with them, especially in a world like this. Crowdfunding seemed like a natural extension of what we do.”
Plus, the company’s only other experience with the fundraising concept—an Aug. 2012 Kickstarter campaign to raise money to have a live, professionally trained duck in Return to Nuke ‘Em High—raised $10,192, much more than the $4,000 they asked for. And the $50,000 for Occupy Cannes may seem like a lot, and is meant to cover a lot of ground, but it’s a moderate amount of money for an Indiegogo filmmaking campaign: some film projects need only a few thousand dollars but others have made north of $300,000, says John Trigonis, the Indiegogo rep working on Troma’s campaign.
Troma is doing everything right to succeed in the campaign: there has been a Reddit “Ask Me Anything” forum and a Google+ Hangout; there have been regular updates on the campaign site, capitalizing on Indiegogo’s statistic that campaigns that do an update every one to five days raise twice as much money; Trigonis says that they’re going the extra mile, that the fan interaction is half the battle and that Troma is doing it perfectly. (And, Kaufman quips, they don’t just contact their fans—they contact their air conditioners!)
They’ve also got donors like Josu Mata, a 30-year-old Spanish filmmaker. “It’s about independent filmmaking and how hard it is for independent filmmakers to get out there and have some kind of way to get noticed,” he says. Mata has worked on movies and television but isn’t right now—the Spanish economy has taken its toll on him. Nonetheless, he’s contributed $10,000 to Occupy Cannes, the prize for which is a trip to Cannes with the Troma team. Mata says he hopes to be part of something about which he can feel passionate.
But, for an established studio like Troma, crowdfunding is not the future.
For one thing, they wouldn’t ask their fans to pay for a full-fledged Troma movie, which can run to about a half a million dollars (Return to Nuke ‘Em High, which will be released in two volumes, cost about $800,000, still teensy-tiny by Hollywood standards). A documentary shot on digital is relatively cheap, and Occupy Cannes exists to prove a point, not to make money, the latter of which is what Troma—or any studio—needs in the long run. While Kaufman says he might return to crowdfunding for campaigns like the Kickstarter duck, to pay for individual movie elements that strain budgets, the fans can’t be called on to pay in advance for feature film budgets. (One thing Troma can get out of crowdsourcing is free market research, says Kaufman: how many people contribute is, like whether or not people make the copyright-infringing products that other companies frown upon but Troma encourages, a good gauge of whether an idea is working. Troma’s publicity director Justin Martell says, if the company wanted to use traditional investments for Occupy Cannes—which they don’t, in order to maintain artistic freedom—the more than 250 people who have already contributed would be a big selling point for investors.)
Another problem is that the strategy can’t be replicated across the industry. Even if Troma can call its legions of fans to arms, not everyone has 40 years of history behind them. “The digital revolution has democratized the making of movies. That’s wonderful. The problem is, how do you live off your art?” says Kaufman. “The line between home movies and movies is becoming very blurred. How do you get yourself noticed with all the billions and billions of videos?” Troma has an advantage in people like Josu Mata, people who would pay $10,000 to hang out with Lloyd Kaufman and make art that is perverted only in a non-business sense.
Kaufman does see potential in a future—mutant, if you will—vision of crowdfunding. It allows creativity without compromise. Fans just want to see a movie, but investors want to make profits, which requires toning things down. “They want you to make baby food, if that’s what it takes to make money,” he says. If companies could offer their fans profits rather than souvenirs, it would be the ideal combination of incentive and creative freedom—but even that’s problematic. Last April, the Jumpstart Our Business Startups (JOBS) Act was passed, part of which would allow just that: businesses could offer contributors financial securities as rewards, though the SEC has yet to iron out how that will work. This will allow companies to “unlock” their fans for more than the return on ticket price, Indiegogo founder Danae Ringelmann tells TIME.
Which would be great for innovation, Kaufman agrees, “not just for movies, but for better mousetraps.” Still, if studios are honest with fans, they will admit that there’s little financial incentive to invest in a movie. “This business is so bad. So many people think they’re going to get profit and they don’t,” he says, noting that the same is true for big studio pictures. “For the most part, if you want to make money, don’t invest in a movie.”
And thirdly, there’s no guarantee of success. They have about $25,000 left to raise and mere days left to do it. When there were about ten days left, Kaufman was optimistic. He had heard that these things tend to accelerate toward the end, and as long as they have enough money to actually get to France everything will be fine. “We can put the rest on my credit card and hope my wife doesn’t notice,” Kaufman jokes.
So Occupy Cannes will get made. The young stars of Return to Nuke ‘Em High, Asta Paredes and Catherine Corcoran—who have devoted themselves to promoting the movie and the campaign, Paredes going so far as to create a tumblr “by” her character—say they will be there even if they have to pay their own way. And part of the reason Troma picked Indiegogo rather than Kickstarter is that they will be able to keep whatever money is raised, even if it’s short of the goal. Martell, the publicity director, confirms that Troma will be there in some capacity no matter what.
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Aside from to Cannes, Troma’s not going anywhere. The company is currently producing a movie directed by a Return to Nuke ‘Em High special-effects guy, and the script for The Toxic Twins—the fifth Toxic Avenger installment, in which Toxie’s teenage twins go through puberty—is in the works. It’s taking a while because you really have to like a script before you make a movie without expecting to make money from it. For those films, Troma will mostly return to its old funding model.
And Kaufman sees the difficulties his own company faces as a good sign for young filmmakers. He and Herz couldn’t have started Troma if they had finished college today rather than in the early ‘70s, but they could have started something else. Maybe something better.
Once upon a time, when sex and slime sold, the only other option was to start in a Hollywood mailroom and work your way up. You don’t have to do that anymore, says Kaufman, who has spent his life since college making movies and selling them. “You can be a schoolteacher in Kansas and make movies. You can make a film once a year for 5,000 bucks and it can be damn good. You can be a nurse, rather than be one of 200 suits in California,” he says. “You can do something useful with your life.”