When working on a micro-budget film all sorts of things that you probably wouldn't think about suddenly become issues.
For instance, the director is having fits looking at his lighting budget -- so we're only going to have one night exterior shot.
Minimizing the number of locations is the other magic component. And I think it really is magic. My 1-3 location screenplays have all done really well. Moreover, I look at theatrical releases and notice how even larger budget ones often have a single location (Saw, 1408, Vacancy, The Messengers).
One thing that has happened for me is that someone will look at one of my scripts, realize that they could make it for a very small budget (like 500k) or a larger budget, and then they pick it up. They figure they can always try to get it made at the higher end, and if that doesn't pan out they'll still have a filmable movie at the lower end. And this is how you get sort of "back into" these higher budgets -- your script now has the connections to get read at richer places and those places figure a couple million is a safe bet on this little feature, so it gets the bump up. Whereas your other scripts that could only be made at 2 million or more so they don't get that start.
One other bit to make the recent graduates applying for those tenure track jobs that also have 100 other recent grads applying for them feel better. The casting director says that they've already got 4000 submissions for our tiny movie!
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