Source: Flickr/Quinn Dombrowski, Creative Commons license

Analysis

Ambition vs. Achievement

This is one in a series of AxaMonitor articles examining Axanar’s crowdfunding efforts, its spending, its goals and how it has reported on those activities. The entire series is listed here.

Main article: Crowdfunding Platforms.
See also: Prelude Kickstarter Details, Axanar Kickstarter Details, Axanar Indiegogo Details and Annual Report.

THIS ANALYSIS offers several views of what Axanar Productions was able to achieve in meeting ambitious goals to fund production of the short film, Prelude to Axanar, the infrastructure producer Alec Peters wanted to support production of the film, Axanar, and the actual production costs for the feature.

As demonstrated in the following charts, at each significant stage in Axanar’s fundraising history, its ambition appears to have outstripped its fundraising capabilities, and its spending has always outpaced what it has publicly reported about its income.

Achievement: Prelude to Axanar

The chart below demonstrates the rising costs for Prelude, compared to amount raised in its 2014 Kickstarter campaign, and the final amount that was spent in its production, which resulted in a cost overrun of $9,452.1)

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THE GRAPHBLUE: Actual money raised. GREEN: Prelude‘s rising funding goals. GOLD: Actual amount spent. (Click image to view full size)

Original Goal

The Kickstarter campaign for the 20-minute Prelude to Axanar started out modestly, with costs held down as much as possible, including deferring payments to visual effects wizard Tobias Richter, Peters said:

We could have gotten Prelude done for $10,000, but it would have meant deferring payment to our VFX team and others, who graciously offered to work and take payment after the main Kickstarter if needed.2)

This Kickstarter was always planned as the first of a series to enable Peters “to make the first true independent Star Trek film.”3)

Stretch Goals

AXANAR PRODUCTIONS attempted to address these budget shortfalls in the revised production budget presented as part of the crowdfunding campaign launched in July of 2015 on Indiegogo.

As the campaign progressed, the “Where the money goes” section of the Kickstarter page, charted the expanding ambition for Prelude as contributions rolled in:

The budget for Prelude to Axanar was about $20,000. But thanks to all your donations, we have doubled that to $40,000, allowing us to do everything better and more professionally. We set the Kickstarter bar low at $10,000 as we really didn’t know what kind of response we would get.4)

Factoring in Kickstarter fees and estimated costs to produce and ship the rewards contributors were due, increased the ask. As contributions continued to grow, Peters added new funding goals tied to costs beyond Prelude — meant for producing the feature, Axanar, itself.

« Suddenly, the money from the Axanar Kickstarter that would’ve gone to production was swallowed up by infrastructure. »

Final Amounts

The total ask for this first Kickstarter had grown to $157,000, noted in the blue bar in the graph above. But the final tally at the end of the campaign had stalled at $101,171, as shown in the purple bar in the graph. With the additional contributions noted below, Prelude had raised a total $123,997, also shown in purple above.

Additional Contributions

But the end of the Kickstarter did not end Axanar’s fundraising efforts. Peters included a PayPal link on Prelude campaign page, and signed up with the fulfillment company, BackerKit to continue to process and ship orders based on contributions that continued after the formal conclusion of the Prelude Kickstarter. Eventually, another $22,826 of income came from these efforts.5)

Spending

With a total raised of $123,997,6) Peters went on to produce the award-winning Prelude to Axanar. The final cost for the 20-minute short came to $133,4497) — a $9,452 deficit that needed to be covered by proceeds from the subsequent Kickstarter campaign.

Ambition: Axanar

The chart below illustrates the rising cost estimates to both produce Axanar and build out the infrastructure Axanar Productions planned for its future projects and rental of its studio assets.8)

Original Goal

IN THE BEGINNING of the second Kickstarter campaign, Peters’ budget estimate was much lower than what it eventually turned out to be, though he gave himself room for the budget to grow:

The 90-minute Axanar feature will take about 3 weeks and cost roughly between $650,000 and $750,000 (the budget is in process based on learnings from the Prelude to Axanar budget, so I would expect the budget to climb).9)

Infrastructure Goals

At the outset, this Kickstarter was meant to pay for the sound stage and set construction. “Anything over what we need for that,” Peter said, “will be applied to the feature production costs.”10) But then the money started rolling in. A rousing endorsement from Star Trek actor George Takei spurred contributions higher than Peters expected:

Because of the help of George Takei, we blew through [the goal of] $500,000 and now $600,000! We never dreamed we would get close to original amount we said we needed, so we didn’t revise the actual production budget, which was created before Prelude to Axanar was even shot.11) [emphasis added]

Peters admitted at the time that he hadn’t really completed the Axanar budget beyond “rough budgets for set construction and sound stage.” He planned to “work on a better budget for the actual production” once construction got underway.

By the end of the Kickstarter campaign, with its record-breaking total of $638,471, Peters believed he had raised enough to cover part of the film’s actual production costs:

We have everything we need for the sets and studio and are well on our way to covering most of the budget. So we are going to start working on a formal budgeting process for Axanar and get those numbers as soon as possible.12) [emphasis added]

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STEEP HILL to climb toward funding Axanar. GREEN: Axanar‘s rising funding needs. BLUE: Actual money raised.13) YELLOW: Actual amount spent through July 2015.14) Money has been spent only on preproduction for the feature film. (Click image to view full size)

Rising Costs

Once Axanar began spending its Kickstarter money, Peters found he had underestimated virtually every major infrastructure cost — from rent on the warehouse he planned to convert to a studio to set construction:

We outlined costs … for infrastructure that we would need to raise roughly $400,000 for. … That was before we found out what everything would really cost and what we didn’t even know we needed.15)

Suddenly, the money from the Axanar Kickstarter that would’ve gone to production was swallowed up by infrastructure. In his Annual Report, Peters made it seem like none of the funds raised by this campaign was ever going to go to production:

[The] Axanar Kickstarter was launched with some very specific goals in mind, namely, building the infrastructure that would allow us to make Axanar and other Star Trek properties.16)

« With the enthusiasm behind Axanar telling us fans wanted to see something spectacular, the scope of the original production grew past the original budget level. »Frequently Asked Questions, Axanar Website

Yet he acknowledges the public perception that the Axanar Kickstarter was to “incorrectly assume that the money was to go to production costs.” 17)

WHILE IT’S TRUE that at the outset of this Kickstarter Peters clearly outlined the soundstage and set construction costs as the objective of the campaign, it’s also true he added that any amount over those costs would be applied to the feature production costs.18)

It is therefore notable that every other spending category named in the Kickstarter campaign was correspondingly addressed in the Annual Report — except for production costs.

According to the Annual Report, even the $638,471 raised — more than six times the campaign’s original $100,000 goal19) — was insufficient to cover all the infrastructure costs Axanar Productions encountered.20)

Budget Escalation

In its April 2, 2016, FAQ, Axanar explained the doubling of its projected cost to produce Axanar this way:

With the enthusiasm behind Axanar telling us fans wanted to see something spectacular, the scope of the original production grew past the original budget level. Similarly, the cost of the soundstage build-out also exceeded the original budget.

Axanar Productions attempted to address these budget shortfalls in the revised production budget presented as part of the crowdfunding campaign launched in July of 2015 on Indiegogo.21)

Lawsuit Impact

LAWSUIT PRIMER Get an overview of the copyright lawsuit, including a timeline of the case, as well as downloadable pleadings made by the plaintiffs, CBS and Paramount, and defendants Alec Peters and Axanar Productions Inc. » Lawsuit Primer

Prior to the lawsuit’s filing, Axanar was scheduled to start shooting in early 2016. Production was halted by mutual agreement by all the lawsuit’s parties until February 22, 2016, the due date for Axanar’s response to the legal complaint. By all accounts, production is halted until the lawsuit is resolved.

Budget Gap

By the end of July 2015, Axanar’s infrastructure spending (including covering Prelude‘s cost overrun) had exceeded the income brought in by this Kickstarter campaign.

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BUDGET STATUS As of January 2016, when Axanar’s Indiegogo campaign was shuttered by the lawsuit, the production appeared to have $565,330 on hand (minus expenses between July 31 and December 31, 2016). Meanwhile, the shortfall between money raised from both Kickstarter and Indiegogo and the production budget for Axanar stands at $745,566 — 66 percent of the film’s production budget.

'Burn Rate'

In its April 2, 2016, FAQ Axanar explains the amount of cash it has on hand changes by the month:

The amount of money left over from [Indiegogo] changes every month due to the “burn rate” of maintaining the studio while Axanar Productions works through the details of the lawsuit.22)

Undisclosed Proceeds

In addition to raising funds on Kickstarter and Indiegogo, Axanar created direct revenue streams through:

  • The PayPal link added to its Kickstarter page after the campaign closed.23)
  • On its own website.24)
  • Via its exclusive Ares Digital Donor Store, where donors can purchase additional Axanar merchandise.
  • “Retroactive donations” that entitle backers to Blu-rays of Prelude to Axanar.

In an April 1, 2016, interview Peters refused to state how much had been raised from these sources, saying that information would be released in the future only to donors.25)

On September 29, 2016, a motion to compel discovery filed by Axanar’s lawyers against CBS and Paramount revealed the studios now had the audit that had been performed on Axanar’s books, and that its undisclosed income totaled something like $200,000, raising the previous $1.3 million to $1.5 million.

Source Data

Download the source documents for the series of articles. The data was assembled into spreadsheets from publicly accessible information made available by the crowdfunding platforms and/or the Axanar Annual Report. Click on the citation number to access the downloadable spreadsheets. 26)

Submit Findings

Readers who make interesting findings by sorting the crowdfunding and financial data on their own are invited to submit them to AxaMonitor. Please use the Feedback page to submit new information. Thank you!

1)
Axanar Annual Report 2015, Revised, p. 6, 12/15/15.
5)
Axanar Annual Report 2015, Revised, pp. 5-6, 12/15/16.
6)
This total includes $10,164 in fees paid off the top to Kickstarter.
7)
Again, this total includes $10,164 in fees paid to Kickstarter
8)
Axanar Annual Report 2015, Revised, pp. 13-16, 12/15/16.
9) , 10) , 11) , 12) , 18)
13)
$638,471 was raised from the second Kickstarter; the additional proceeds came from the Axanar Indiegogo campaign.
14)
Deficit is based on the second Kickstarter’s total of $638,471.
15) , 17)
Axanar Annual Report 2015, Revised, p. 8, 12/15/15.
16)
Axanar Annual Report 2015, Revised, p. 7, 12/15/15.
20)
Axanar Annual Report 2015, Revised, p. 10, 12/15/15.
24)
Axanar Donation Page, retrieved 5/2/16.
26)
Download Excel spreadsheet with data from Axanar crowdfunding campaigns on Kickstarter and Indiegogo. Also, the Axanar Financials spreadsheet summarizes data from the Axanar Annual Report, 2015, Revised, and the data used to generate charts in the Ambition vs. Achievement article.