Tim Katz: “Obviously Pitch Costs Are the Bane of Everyone’s Life”

'Money Talks' is an interview series, created in partnership between Little Black Book and SYZYGY, that is set to bust taboos by shining a light on the role of finance in production. 

We’ll be speaking to leading producers and production company owners about the financial pressures they face day-to-day, and what challenges they need to overcome in order to simply make top-tier productions happen. Over the course of these conversations, we’ll hear first-hand stories from the production frontline and get a little more comfortable talking about that most important of topics: money.

To follow on from our interview with Prettybird president Ali Brown, we are thrilled to welcome Tim Katz, managing partner at Knucklehead.

LBB> Tim, something we often hear is that timely payments can be a tricky factor in production. There's a contradiction between the need to obey contract dates when it comes to the shoot, but the terms of payment seem a bit more 'flexible'. What are your thoughts on this?

Tim> It won’t surprise you to know that I think it’s pretty poor.  

As you say, we have to stick rigorously to contractual dates regarding shooting and delivery, but apparently need to be fluid when waiting for payment. To be fair, not everyone is like this – plenty of agencies are prompt and efficient. 

Often the biggest problem is when you are working with people for the first time – the famous ‘on-boarding’ conversation where it then turns out that they don’t think they can pay you anything before the shoot. We’ve just had it with a major travel brand who suggested that although they couldn’t sign a contract or make a payment before the shoot, we should be fine because we had an email from them saying they were 'broadly in agreement with the budget'. Of course we couldn’t roll with that, and surprise surprise when we said we would down tools the contract, the money was suddenly available.

One thing that has worked in the past, for us more than for the clients probably, is our offer to charge a finance fee on late payments or non-payments before the shoot. Bank-rolling someone else’s cash flow is purely a commercial decision; it can happen, but probably on commercial terms rather than as a favour.

LBB> There's also the costs that go into bids and treatments, which can impact companies of all sizes. Do you feel this is still an issue, and what is the current status of this part of the production process? Can it ever be changed?

Tim> Obviously pitch costs are the bane of everyone’s life. That’s just the way the industry has developed.  

At Knucklehead we have various strategies to try and keep a lid on it, but nothing is for nothing these days. Even a cheap pitch consumes resources, in terms of people’s time if not actual money.  

Of course the cost of getting work is part of running a business so cannot be wholly avoided, but I hear of companies spending really bonkers amounts of money on treatments and I often think that that is also a bit crazy. It’s on the EP or the company to try and control this stuff, and I think I’m against the idea of introducing paid pitches for jobs (unless the job dies after the pitch, or you’re pitching while waiting for research results etc). If clients have to pay for every pitch they will just resort to inviting the same ever smaller circle of big name directors into the room, and the ability of young directors or left field talent to break in will be even more restricted.

LBB> When it comes to budgeting, what’s the most surprising thing that you need to account for?

Tim> I’m not sure if it counts as surprising, but I never really understood the logic of TOC (time off the clock). I very much understand the need to protect working hours for crew, and to limit late nights into early mornings for safety reasons. Totally into that. 

But I don’t understand how it’s unsafe if people are not paid for having 10 hours off or whatever it is, but it becomes really safe if you just pay them overtime for 5 of those hours. I think if you were an alien looking down on how we do things, you might question that one.

LBB> And what’s something that’s always forgotten in the budget?

Tim> There’s always something. Always. Forgetting to put any catering into the budget for a seven-day studio shoot was never my finest hour.

LBB> Broadly speaking, how healthy do you think the financial landscape of the industry is right now? And is there anything obvious which might improve it? 

Tim> Surely it depends who you ask. I’m sure there are plenty of people wishing they got paid more. And quite a lot of people who are getting paid just fine, but probably being quite quiet about it. 

LBB> In a world of enormous, prestige ads and snappy social-first content, is there any longer such a thing as a ‘mid-budget’ ad?

Tim> I think there still is. Of course the middle ground is more challenged, mostly because of agencies trying to do more and more of that work themselves in-house, but every so often you get a script and it has the right amount of money. Maybe a two or three day shoot with the right cash and the right schedule and you get to enjoy the sense that all is well in the world. And then they ring and change the schedule, and say the client reduced the budget, and can they have the treatment this afternoon not next week, and so it begins again.

LBB> How do you ensure that you have enough cash left in the bank for developing talent within your company, and passion projects including music videos?

Tim> Arguably I’d say most music videos ARE passion projects. But the whole short film, test film, passion project thing is a tricky balance. 

Sometimes the decision is made for you – you’ve either got the money or you haven’t – but I think as company owners you have to really interrogate who is going to benefit from your investment. Is that 27-minute autobiographical short film really going to bring in a big budget commercial? 

LBB> And finally, for any production business-owners reading this interview, what’s the best piece of advice you’ve either been given, or had to learn first-hand?

Tim> Try to spend less than the agency gives you. Stick to that, and you’ll generally be OK.