Evaluating Campaigns

A Due Diligence Framework for Entertainment IP Tokens

Not all entertainment tokens are equal. This guide provides a systematic framework for evaluating campaigns before investing.

The Five Pillars

1. Team & Track Record

Questions to Ask:

  • Has the producer/director completed projects before?

  • Do they have IMDb credits, festival selections, or distribution history?

  • Is the team credited on recognizable work?

  • Have they managed budgets of this size successfully?

    • Red Flags:

  • No verifiable film/TV credits

  • No team photos, bios, or social presence

  • Vague claims like "Hollywood veterans" without names

  • Budget seems wildly misaligned with project scope

    • Green Flags:

  • Previous projects with festival placements

  • Named actors or crew attached

  • Transparent budget breakdown with realistic line items

  • Active, engaged social media presence

    • 2. Budget Realism

    The Floor Test:
    The Floor is the minimum funding required. Ask: Can this film actually be made for this amount?

    | Budget Level | Typical Scope | Red Flag? |
    |---|---|---|
    | $50K–$100K | Micro-budget feature, documentary | No, if realistic |
    | $100K–$500K | Indie feature, limited locations | No, if justified |
    | $500K–$2M | Mid-tier indie, named talent | No, with distribution plan |
    | $2M+ | Commercial feature | Requires proven team + pre-sales |

    Budget Breakdown Analysis:

  • Pre-production: 10–20% (script, casting, permits)

  • Production: 40–60% (shooting, crew, equipment)

  • Post-production: 15–25% (edit, VFX, sound, color)

  • Marketing: 10–20% (festivals, PR, distribution)

  • Contingency: 5–10%

    • Red Flag: A $500K project with $50K allocated to post-production will look like a student film.

    3. Revenue Plan

    How will this project make money? A campaign with no revenue plan is a donation, not an investment.

    Strong Plans Include:

  • Distribution strategy (streaming, theatrical, festivals)

  • Pre-sales or letters of intent from distributors

  • Genre analysis (horror and documentary often have clearer paths than drama)

  • Territory breakdown (domestic vs. international)

  • Ancillary revenue (merchandise, soundtrack, remakes)

    • Revenue Model Assessment:

    | Model | Predictability | Timeline | Examples |
    |---|---|---|---|
    | Streaming licensing | High | 6–18 months | Netflix, Amazon, Hulu |
    | Theatrical | Medium | 12–36 months | Indie distributors |
    | Festival prizes | Low | 6–12 months | Sundance, Cannes, TIFF |
    | Self-distribution | Low | Variable | Direct-to-consumer |

    4. Token Structure

    Supply Analysis:

  • Total supply = Total raised / Token price

  • Lower supply + high demand = price appreciation potential

  • High supply + low demand = price depression risk

    • Pricing Assessment:

  • $1.00 per token is standard (1 USDC = 1 token)

  • Higher prices ($5–$10) suggest niche or premium positioning

  • Fractional prices ($0.10) suggest mass-market, high-volume strategy

    • Risk Tier Monitoring:
    After graduation, check the token's RiskOracle tier:

  • GREEN: Healthy — good liquidity, active trading, fresh pricing

  • YELLOW: Caution — some staleness or elevated utilization

  • RED: Risk — thin liquidity, possible manipulation, high borrowing

    • 5. Community & Momentum

    Signals of a Healthy Campaign:

  • Active social media engagement

  • Regular producer updates

  • Growing investor base (diverse wallets, not a few whales)

  • Trading volume post-graduation

    • Signals of Trouble:

  • Producer goes silent after funding

  • Trading volume collapses after launch

  • Concentrated holdings (few wallets own most supply)

  • No updates for weeks

    • Scoring Matrix

    Rate each campaign 1–5 on the five pillars:

    | Pillar | Weight | Score (1-5) | Weighted |
    |---|---|---|---|
    | Team & Track Record | 30% | | |
    | Budget Realism | 25% | | |
    | Revenue Plan | 20% | | |
    | Token Structure | 15% | | |
    | Community & Momentum | 10% | | |
    | Total | 100% | | /5.0 |

    Interpretation:

  • 4.0–5.0: Strong candidate. Consider significant position.

  • 3.0–3.9: Moderate. Diversify with smaller positions.

  • 2.0–2.9: Weak. High risk, only for speculative capital.

  • <2.0: Avoid.

    • Portfolio Strategy

    Diversification Rules

  • No single project > 20% of your entertainment token portfolio
  • Mix genres: Horror, documentary, animation, and drama have different risk/reward profiles
  • Mix stages: Some active campaigns, some graduated tokens trading, some in production
  • Geographic spread: International projects may have different distribution dynamics

    • Position Sizing

    Consider the stage of the project:

    | Stage | Risk Level | Suggested Allocation |
    |---|---|---|
    | Active campaign (not funded) | High | 1–5% of entertainment allocation |
    | Graduated, pre-production | Medium-High | 5–10% |
    | In production | Medium | 10–15% |
    | Post-production / festival circuit | Medium | 10–15% |
    | Released, revenue flowing | Lower | 15–25% |

    Red Flags Checklist

    Before investing, verify none of these apply:

  • [ ] Producer has no verifiable credits

  • [ ] Budget is unrealistic for the stated scope

  • [ ] No revenue plan or distribution strategy

  • [ ] Token supply is excessively high with no demand drivers

  • [ ] Producer is unresponsive or evasive

  • [ ] Social media is brand new or has fake followers

  • [ ] Campaign has been extended multiple times (if allowed)

  • [ ] RiskOracle shows RED tier with no explanation

  • [ ] Wash trading suspected (same wallets trading repeatedly)

  • [ ] Producer promises guaranteed returns

    • Next: Trading & Yield Strategies →