Agreeing to a Revenue Percentage Deal

In the no/low budget and also in semi pro productions, it is quite a common practice to "pay" the cast and crew in percentages of revenue. It goes effectively something like "You get x% of any revenue this film/game/project generates after release".

At first glance, this seems like a better deal than working for nothing but oftentimes there is no real difference. Of course, there might be this lucky punch project that unexpectedly generates a lot of income but personally, even after being for more than 15 years in this business, I have not heard of a single project that had this payment model and made the cast/crew rich.

The most important thing here is to understand that this is a model that is based almost exclusively on mutual trust. There are four things to consider here:

1. Such a deal should have a clause that you have the right to get insight into the book keeping of the project on request so that you can find out whether a project generated revenue or not. But even if you use that right, unless you have a very firm understanding of the management and production of such a project, you might simply get lost in the sheer amount of book keeping that is going on with such a project. Alternatively you could hire someone to check it but in most cases the investment is just not worth it.

2. It is relatively easy for a production to "hide" revenue. Unless it is not clearly defined what counts as revenue, they can easily claim that certain things reduce the revenue The director needed to travel to this film festival to promote the movie? "Yeah, that trip and expenses unfortunately needed to be financed from the income that the movie had generated so far. Sorry, no payout."

3. The potential for an indie project to generate income is relatively low. Unless it becomes a viral hit, most projects even struggle to break even.

4. With such a project, there is an incredibly high potential that it will never cross the finish line. While motivation for everybody might be high at the beginning, it very often fades away after the first real obstacles appear on the road, people might get caught up in other projects etc. With no imminient financial incentive, it is very often hard to keep the moral of an entire team up for an extended period. I have worked on a few projects with such a payment model in the last years of which I'd say about two thrids didn't make it past the finish line, so this is a quite important point to consider.

These are all things that you should be aware of when you accept such a deal. In 99% of these cases it means you will not see a considerable amount of money afterwards, so essentially, such projects are just sugar coated no-budget deals.

Having said that, it doesn't speak against accepting such a project once in a while. Just last summer, I worked on a small project that pays me in percentages. I don't expect any money from that but it was a welcome and fun project to do besides my "regular work" so I happily accepted. I feel that it is a nice thing to do if you can afford it to once in a while work on projects that might not pay you well but are just plain fun to work at or have the potential to broaden your horizon or network.

So the bottom line is to manage financial expectations with such deals and rather assume that no money will be earned with that, but they might be fun anyway.