Sometimes yes, sometimes no; depends primarily on the contract negotiated between the producers the investors.
My own personal logic runs that the first financial obligation of the producers should be to make sure nobody's out-of-pocket, by repaying whatever anyone has actually spent on their behalf. In terms of cast & crew that means covering expenses (which is one of the first "production costs" that the initial investment is taken in to cover); in terms of investors, it's repaying their investment so at least they've got their money back (otherwise everyone else is making a profit while they're still at a loss -- and I'm not in the charity business).
Second is to give everyone a reasonable reward for the work they've done: for cast & crew this means fees (up-front if the cash is available; deferred if not) -- you could view this as compensation for opportunities foregone because their time was tied up with this project; for the investors it means a basic-but-reasonable return on their investment -- compensation for the interest/ROI that was foregone because their money was tied up with this project.
Third, assuming the project is particularly successful, is to make sure the excess profit is fairly shared between those responsible for lifting the project from a typical/standard/acceptable product to this higher, exceptional status. Typcially that's down to the producers (who put the whole package together), the director(s) & designer(s) (who designed & shot something visually outstanding), the lead cast (whose faces & performances the audience so wanted to see), the promoters (who stuck it in everyone's faces so effectively), and the investors (who bet their farms to make the whole thing possible -- and who will be so much easier to tempt back next time if you give them a big smile this time!)
Correspondingly I usually structure projects in line with those stages:
=============== PRODUCTION ===============
initial investment covers cast & crew expenses (along with all other prodcution costs), plus as much as possible in terms of wages.
================= SALES ==================
first block of revenue repays the investors (plus any additional debts incurred during production/post-production)
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[the aim is to structure the budget so this line is as low as possible without causing cashflow emergencies before completion]
second block begins to reward investors, while covering the deferred portion of everyone's fees; reasonable for the producers to see a return here too.
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[this line is where the sales target falls; as a producer, if you can't build a project that expects to get this far, either re-structure or drop the project]
third block continues to reward investors, plus the key cast & crew; this is where the producers stand to make the most, I'd suggest.
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[how high this line goes depends on how good you were in a former life ;-)]
Others do it differently, though -- in fact pretty much any pattern you can think of, however fair or biased (in any direction) will be in use somewhere in the world, on some production, this very week. Which is why -- certainly if you are offered points or a deferral -- you should always ask the question. Hell, even if they're not offered, you may be so impressed with a production and its chances of success that you'd like to take the gamble anyway; I've never known a producer who wouldn't at least want to listen to another potential "investor"...
Luv'n'hugs
David
