Equity Crowdfunding A Movie – An Opportunity for a Passive Income Stream?

Gentle Readers,

Any blogger with more than one post in a niche gets random emails soliciting posts or access to your platform. Most of them are clearly spam. They are the equivalent of offering to write a post about Viagra for a lesbian’s financial independence blog. They all claim to have read you and love your blog, but they’ve never interacted with you on any platform. (Hint, I’m on twitter and facebook and right here at www.zjthorne.com). No liking a tweet. No blog post comment. No indication that they’ve read you at all.

This time was different. The approach was interesting because they actually did some homework on me. They showed that they had read one of my pieces, or at least the title. They put in the minimal required effort to pique my interest. They are the first. There are perks with being first.

When you approach someone like you respect their time, they are more inclined to listen.

Based on our interactions, I believe this person’s idea was worth investigating. They did not ask for a post, and this is not a sponsored post. This is what happens when people respect others’ time and expertise (let’s joke and pretend I’m an expert here, thanks).  I am not receiving any money for this post and I have not decided if I would invest in this project.

Enough with the caveats.

What is Equity Crowdfunding?

Title III of JOBS Act made online equity crowdfunding legal. In a nutshell, you do not have to be an accredited investor in order to participate in some opportunities to invest now. Accredited investors have a lot of money and the government assumes that they know what they are doing when it comes to investing. Thus they are allowed to invest in securities that are not registered with financial authorities. The government thinks that slick folks won’t be able to pull one over on accredited investors and that they don’t need to be protected from themselves.

Those of us who do not make enough money are now allowed to buy equity in an early stage company. You are reading a FIRE blog and I assume you know what equity is. The goal is that this asset produces returns. You can invest in some startups now. That’s the gist of equity crowdfunding.

What is the opportunity?

That Christmas Movie LLC is seeking investments to get a Christmas Comedy out the door for the 2017 Holiday Season, “I’ll Be Next Door For Christmas.”  It is going to be a full length feature film and claims that it will be the first Christmas movie to raise funds this way. (The JOBS Act did not make this legal until 2016, fyi)

Essentially, they are making a low-budget Christmas Movie with some very talented folks, who’ve made comedies I’ve enjoyed before. They will leverage the money earned through equity crowdfunding to access other capital at a cheaper rate.  They’ve reached their minimum goal already and intend to make a movie on whatever budget they end up with. If I understand it correctly, they will not use more than $2 million total to produce this film.

If you have anywhere from $100 to $100,000, you can purchase a share of this security. You are buying Revenue Participation Rights. It is impossible to know what the interest rate would truly be, because that will depend upon returns, if any.  They’ve set up the company in a way to allow the investors to receive 100% of the adjusted gross proceeds up to the repayment amount, that is the $100 to $100,000 you put up. After all investors are repaid, 50% of adjusted gross proceeds would go to investors on a pro-rata basis. There is no term. You buy it and hope to receive residuals forever.

There is even a lesbian link

Jennifer Tilly joined the cast. She is not a lesbian, but she starred in a lesbian classic, Bound. Queer women throughout the US are grateful to her.

What do you think? Should I invest? I have the writer/director’s email and am not sure what questions I should be asking. What would you ask? 

Net Worth Week 52 – Year One Done

Gentle Readers,
One year of tracking my net worth is officially complete!
I’ve learned a lot by focusing so intently and have had some improvements while also having some setbacks. Those setbacks would have been worse if I hadn’t been focusing so hard.
At this point last year, my business was not going as well and I was about to spend a lot of my personal money keeping it afloat. I was also in a lot of pain, but had not yet figured out how to navigate the health system to get the care I needed. My girlfriend lived in my town, but in a very high stress, high hour job. I had begun learning a new skill, but was still very much a novice.
This year, I’m in a slightly better financial situation. My business is doing better and I understand better how to make it work. My pain is diminished and I am physically stronger. My girlfriend lives over 1000 miles away, and this chapter in our relationship has already taught us a lot. My skill-building is reaching exponential-growth levels and it is encouraging. My heart is also in a much calmer position. I’ve become more centered in a few ways even as the world around me, and portions of my life, are more uncertain.
This week has had some financial setbacks. After a few days with the mattress my roommate “gifted” me, my body has concluded it needs to be replaced along with the frame that is not structurally sound. I’m not thrilled with this, but I think my body can hold off a while. I ordered the frame my brother recommended and will use that once it comes in. I was worried for 24 hours that I would have to replace my phone after it took a trip into water. Thankfully, it is back in working order for now and I can wait to replace it.
I still find this weekly exercise useful and think I’ll keep it up for the time-being. One more year ought to get me into a better place.

This week’s net worth numbers

4/15/2016 4/7/2017
 Joy 1097 1105
 Travel 322 1
 Down Payment 18 19
 Retirement 21 21
 Health 45 45
 Moving 31 285
 EF 9 11
Business 1 1002
Life 907  639
 IRA  7026  12736
 Brokerage 221  689
 Rewards Card 2 n/a -585
 CC (largest) 0  -3264
 CC (longest) 0  0
 Rewards Card -3000 -1331
SL 1 -101892 -104519
 SL 2 -45001 -46041
 Earnest -10036 -5274
 Net Worth -150230 -144460
 Percentage Change 3.84%

Have you grown this year?

Net Worth Week 12 – A Glimmer of Progress

Gentle Reader,

This summer and year have been about volatility in unexpected places. We all watched the markets dip and rebound after the initial Brexit vote. I personally had some shenanigans at my gig, but was really encouraged by the community’s response to my attempt to get to FinCon. Y’all are wonderful and supportive. Thank you.

I am an hourly employee at my temp gig, and I had the misfortune of being sent home after a half day unexpectedly. I did nothing wrong, but they could not get their systems to work, which meant that I couldn’t work either. This will definitely impact next week’s paycheck and comes at an unfortunate time since I had worked a half-day on Monday as well. You are guaranteed nothing as a contingent employee. This week reminds me that I need to pursue FIRE to rid myself of the vicissitudes of laboring for others.

Brexit definitely impacted my retirement accounts. I’m personally on the right track, but am worried for the world in the next few years. Increased volatility hits financial markets definitely, but it absolutely increases violence in the world. I’m watching Venezuela and worrying what other countries will respond to market conditions in a similar vein.

I still love Earnest and credit them with my ability to conquer some of this debt.

Date 6/10/16 6/17/2016 6/25/2016 7/1/2016
Joy 1098 1098 1098  1099
Travel 322 323 323 323
Down Payment  19 19 19 19
retirement  21 21 21 21
health  45 45 45 45
Moving  31 31 31 31
EF  2597 2597 2597 2002
Business  1 1 1 1
Bed  .29 0.29 0.29 0.29
Life  1729 1839 1140  1929
IRA  8516 8285 8765  9580
Brokerage  226 221 315 324
CC (largest)  0 0 0 0
CC (longest)  0 0 0 0
Rewards Card  -5434 -5300 -5347  -5675
SL 1  -102120  -102268 -102284 -102482
SL 2  -44971  -45017 -45067 -45112
Earnest  -9258 -9286 -9306 -9328
-$147176 -$147390 -$147748 -$147222
  -1.0% change -1.0% change -.24% change  .35% change

How did your week go? Have your accounts already recovered from Brexit?

How I Got Here

Gentle Reader,

Every indebted person is unique in how they arrived to their indebtedness. The majority of my debt is educational, and contributed to my becoming a Professional. The debt is not just from my degrees though. I have used some of this debt to position my life and business in a way that I hope will sustain me in the near future.

My professional industry is rapidly changing.  Unfortunately, my entrance to my profession coincided with its crash. I have been working in gigs rather than a full career job since 2012. The gigs pay more than childhood me ever thought she would earn. The gigs pay more than the career I had always assumed I would have. The gigs pulled me away from considering the nonprofit work that would not pay me enough to live in this city.  For this, I am actually grateful. Having enough has taught me that work should not underpay me just because the work was important and necessary to the world. Work that cannot pay a living wage for its location while being location-dependent is unfair to workers and inappropriate. You should not have to take a vow of poverty to do good work.

In 2014, with the emotional and, at times, substantive, support of Mabel and TBO, I incorporated my own business in a niche within my professional field. I was able to do this by taking half of my liquid savings. All of my savings, outside of my investments in my brain and relationships, were liquid at this point because I was in a scary market and afraid of gigs drying up.

I used my investment in my LLC, and began slowly building it up while working gigs full time. I supported my life with the gig money, and also credit cards. I had some CC debt when this began, due to making a poor decision in a previous relationship. However, starting my business took so much from me and I did not feel able to get a bank loan. I never tried though. The CC debt and revolving gig work created a bad cycle.

My LLC is a bare-bones business that is able to support itself for the next few months without an infusion of cash from my personal accounts. I’m hopeful that my LLC will pay me for the first time this calendar year.

So my story is like many others’ before. Poor decisions in a relationship. Then fear keeping my savings liquid. Finally making decisions designed to take control of my life and financial well-being. This took longer than I am proud of, but I am still young enough to make my life resemble what I desire.

Wish me luck.

How’d you get where you are?