I was watching an interview on “The Lean Finance Model” and tech start-ups. It is an idea that “We are in the era of cheap” and that financing needs to create low-cost approaches to getting tech start-ups off the ground. This means there need to be a low-level of initial financing, until the company validates itself in the market. This initial investment would be low, around $800k-$1M. Once the company proves that there is a demand for its product there is usually a large dump of money that follows in what is called a Series A/ B round of financing. Basically the idea is that you start to shovel money into the company in the hopes that you can grow it quickly. Usually this next round of financing is around $10-12M.
The lean approach is different. It has a second round of financing that is much smaller, perhaps as little as $2M. The company has proven itself after its first round of financing but it still needs to show it can continue to provide value. If the company continues to show traction it will have proven itself and can get ready for a large influx of capital. This is the big burst of funding that is often in the $20-25M range.
Transmedia could easily adopt the same model. If a creative property looks promising a small amount of seed capital could be introduced to build a transmedia experience that exposes the creative property to a larger audience. The goal of this seed round would be proving the property has affinity with an audience and has the potential grow into a larger property such as a television series or film. At this point some more money can be brought into the project to expand the transmedia project and explore what kinds of media seem to work best for the audience. The feedback will help to grow the brand of the creative property and correctly assess the next step in the evolution of the creative property.
This is a little different from most funding where you start with a concept, perhaps a graphic novel or a script, and then you decide to move it into another form of media such as a video game or film. The amount of money starts piling in quickly and once you’ve committed all that money you hope that your choices were correct.
A lean approach for transmedia focuses on keeping initial production costs down and lowering the risk of spending a lot of money before a creative property proves itself with an audience. It will also help you determine the appetite for an audience to spend money on your property. It requires you to keep production costs low during the initial stages but it can also give you an indication of what the audience expects from the next phase of your transmedia, and, perhaps most importantly, what they are willing to pay for it.