Kyle
Are you old enough to remember the days of HSX.com, before 9/11 it was the place to go to invest virtual money into real life actors, actresses and movie projects, called the Hollywood Stock Exchange. Now this wasn’t real you weren’t really investing money in a movie it was more of a game, kind of like fantasy baseball. If the movie did well the actors and actresses did well and then you made more virtual money.
Well shove all that aside because a St. Louis startup called passer.by is working on a crowdfunding website for real movies. Passer.by was founded by childhood friends Todd Metheny and Josh Clayton. Clayton has some experience in the film business but for Metheny it’s a new venture based on a love of movies.
Passer.by will be a way to get film projects off the ground with the help of many people, from friends and family. They have several funding options and plans they are working on. Metheny says they are riding out the “JOBS act” and the SEC to see if the entire crowdfunding model will be a go.
As for how much it costs for the film maker, right now they are launching the first 20 films with the film makers “paying what they choose”.
“It’s certainly a risk, but it’s exactly the kind of risk that we’re excited to take,” Passerby CEO
Todd Metheny said. “Some people will choose to pay nothing, but it’s a matter of trust. Our
mission is to be the crowdfunding option that puts filmmakers first, and to do that we need to
create a relationship with our users that is built on trust.”CCO Josh Clayton is exciting to see how filmmakers react to the “pay what you choose”
option. “We’d love to be ‘pay what you choose’ forever, and we very well might be,” he
said. “We just need to make sure it’s possible to cover the expenses related to running the
platform at that level. We believe it’s a favorable experiment for the filmmaker.”
We spent some time talking with Metheny about passer.by check out the interview below the break.
How did you guys come up with passer.by?
The name sort of had multiple inspirations. 1. Right about the time I started thinking about doing this, I read a David Geffen biography called ‘The Operator’, written by a guy that used to cover Hollywood stuff for the WSJ (Tom King – now deceased). In the book, Geffen really admires this famous record exec named Ahmet Ertegun (founder of Atlantic Records…discovered the Rolling Stones). Anyway, Geffen asks Ertegun what the secret to his success is at one point, and Ertegun mimes this slow walk and says, “I just walk real slow, like this, and maybe I’ll bump into a genius and he’ll make me rich.” I just really liked the humility of that answer – it sort of says that the real value is in the artist, and that even though he helps the artists get there, he’s really just a beneficiary of their genius. I liked that. So I kind of wanted something related to walking slow.
2. Name inspiration two. When I was about 12, I was reading an old library book. I’d tell you the title but it’s silly. Anyway, someone had written all these notes in the margins in pencil, and underlined stuff and whatnot (I’m sure you’ve encountered that type of library book). There was a line in the book that said something to the effect of “How many are the lives we meet and pass.” The prior reader had underlined that line and written in the margin beside it, “And how might our lives be different if we had not passed by.” For some reason that really stuck with me.
3. Finally (last name thing) – the idea originated as purely an equity investment platform. Before the Jobs Act or any of those crowdfunding bills were around, I was on Lending Club (I used to write a blog and would frequently write about alternative investments and stuff), and Microventures was brand new. And I was talking to Josh Clayton (our CCO) one day, and I told him that I thought it would be cool to do “Microventures for Movies.” We sort of tabled it, but we kept coming back to it. We liked it so much. And one day I said, what’s potentially amazing is that any random passerby could throw $100 investment at a movie – a new opportunity.
1. To sort of build off of #3, above. We didn’t do anything at first. I talked about going to business school or something and doing it as part of a competition somewhere. I took the GMAT, applied, and got into a couple top 10-15 range schools. Then, in November of 2011, I saw something about the “crowdfunding bill.” I sort of realized that if I wanted to work on this particular idea, I needed to move now. There would always have been another idea, of course…but deep down I wanted to just start a company in the NOW, you know? I emailed Brad Feld, whose blog I read regularly, and asked him what he thought. He said that he didn’t think the MBA would add anything, and if I wanted to start a company, I should go make it happen. It was a conclusion that I had already pretty much come to, but it was a nice email to get from someone I admired. It helped.
I immediately recruited Josh, who I had sort of been recruiting all along. We worked through some of the early stage stuff. In January of 2012, we did Startup Weekend St. Louis and won one of the prizes (we won a made-up division). Startup Weekend was really helpful because we had to put the idea out there quite a bit and defend it to a lot of different people with different view points. It’s also where we added Keith Homco, who has been the lead developer. Very tough guy. Big motor.
Keith was/is a QA tester at Monsanto. We want to get him full-time as soon as possible. His background is in MIS. He played football at Missouri Institute of Science and Technology.
Josh and I are childhood best friends. We went to high school together. Josh got a business degree and worked in brand management before moving to NJ to get an MFA in acting and ultimately pursue acting. He’s worked as a professional actor but has done a lot of industry related jobs, including dabbling in producing. Very talented guy. Very smart. Gets things done. Josh also had a web-design business for actors called Red Mutt Designs, and put actors on tape for auditions as part of another business he started called View My Take.When Josh went to get his MFA, I went to law school. I practiced law for the last four years, working as an Assistant Attorney General for the state of Missouri. I left in February in order to focus on Passerby full-time.
Not as much as we’d like. We’re learning. Josh has the most. We have a lot of industry people helping us out with things.
Reach out to us. We’re accepting submissions on our site right now for the donation platform. We’re waiting to see how the SEC regs turn out related to the Jobs Act, but we’re moving forward with our equity based platform as soon as we can.
I’ve never launched one inside silicon valley, but based on my perception, certain things are harder. The startup community is smaller here, for instance. But maybe that makes it tighter knit? We see the usual suspects at all the events. I do think there are fewer of certain types of resources available here. St. Louis is working hard though on changing that, though.
Josh is actually in New York, and we have people helping us out in LA as well. No one in LA is technically part of the company at this point – but we’ve definitely gotten help. We want people to be able to make their films wherever they are, too. The price point for filmmaking has gotten lower, with so many things being shot on digital. Distribution has gotten easier and cheaper, with the internet and direct distribution. The key, now, seems to be whether you can build an audience around your film rather than where you’re located.
That said, I’m sure there would be advantages to being in SF, LA or NY. We believe we can make it work here. Time will tell.
Obviously, there are advantages to being here, too. It’s cheaper to live. We have fairly easy access to both coasts. People are loyal and hardworking. St. Louis is a good town.
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