Back End
Profit participation payments made to talent after a production recoups its costs.
Definition
Back end refers to compensation tied to a film or show's profits, paid after the production has recouped its costs. Unlike upfront fees, back end points represent a percentage of net or gross profits that continue paying as long as the project generates revenue.
Negotiating meaningful back end requires understanding studio accounting practices and defining "profits" clearly in contracts.
Why It Matters
Back end can dwarf upfront payments for successful projects. Actors, directors, and producers with strong back end deals have earned tens of millions from single films.
Understanding back end structures helps talent and their representatives negotiate deals with long-term value.
Examples in Practice
A director takes a reduced upfront fee in exchange for 5% of gross receipts, earning $30 million when the film becomes a hit.
An actor negotiates first-dollar gross points, meaning they receive back end payments immediately, not after studio recoupment.
A producer discovers their net profit points are worthless because the studio's accounting shows the blockbuster "lost money."