How do I Know Whether an Offer is a Good One – Entertainment Law Asked & Answered
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Amin wrote in with a question about how to evaluate a film option that's been offered.
I'm Entertainment Lawyer Gordon Firemark, and this is Asked and Answered, where I answer your questions about the business, so you can take things to the next level.
Amin has been asked to negotiate a deal with a production company that wants an option on a friend's life story rights. the question is. “How Do We know that the price they are offering is a good one?”.
How can you know whether an offer you've received is a good one?
Well, mostly, I have to say, that comes down to three things. Research, Experience, and Intuition.
Research can tell you a lot about the situation. Look at similar projects in recent years, and gather data about what folks received.
Look at the people and companies involved, and what they've been involved in in the past.
Look at what other participants in THIS project are getting.
Ask around, but don't rely too heavily on the opinions you get from your immediate friends and family, unless they have the next component… Experience.
Probably the most important tool you'll have in evaluating an offer is Experience. Your own, your friends' and colleagues, and that of your representatives.
One of the big advantages of having representatives; an agent, manager and lawyer; helping you with your deals, is that they work in this business all the time. For every deal a single client has seen, we are seeing multiples… Because we have more than one client Working in this business. So, we have a built-up base of experience to draw on. when advising and representing our clients.
But your own experience is valuable too. You may have Factors that you consider that wouldn't be obvious to your lawyer or agent. Maybe you've worked with these folks before, and they're so much fun to work with, that you'd do it again regardless of the money. Or, maybe the converse is true. They were so difficult that no amount of money could make you do business with these folks again.
Your experience, combined with your research will naturally inform the third component of this… Intuition. Listen to your gut. What is it saying about the offer? If you were to take the offer, how would it make you FEEL? If the answer is anything but “GREAT”, think harder. Why is it less than stellar?
But knowing whether an offer is a good one is only the beginning of things. What comes after receiving the offer is really where the rubber meets the road. Negotiation.
There are lots of approaches to negotiation, but ultimately, it's about asking for what you want, and making sure you get what you NEED from the deal. Again, this is where working with your representation is really important. I've yet to see a deal that wasn't improved through negotiation, and the ones that get handled by professionals, get the most improvement.
So, unless the deal you've been offered is a real turd (steaming pile), you can make a counter offer, and eventually strike the deal that does make you feel great. Or, if you conclude that can't happen… You say NO.
I'd always prefer to feel bad about a deal that didn't happen, than about one that did, and for which I've worked hard, invested my energy, and ultimately been burned or embarrassed.
So.. To recap.
When you evaluate a deal, look to:
Consider what you really NEED out of the deal, and determine whether everything is covered.
Oh, and get some help from a lawyer, agent or manager.
If you have a question you'd like to see featured on Asked & Answered, hop on over to https://firemark.com/questions.
This is intended as general information only and does not establish an attorney-client relationship. It is not a substitute for a private, independent consultation with an attorney selected to advise you after a full investigation of the facts and law relevant to your matter. We will not be responsible for viewers'’ detrimental reliance upon the information appearing in this feature.
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