What can you get for two or three thousand dollars? For most people, it’s a few months’ rent or a car that would probably break an axel before you hit the California state line. But for Aaron Katz and his college cohorts, a few thousand dollars financed Dance Party, USA, the 2006 film that launched their careers when it premiered at the South by Southwest Film Festival. Four years later, following their similarly micro-budget 2007 film, Quiet City, Katz and his longtime collaborators, producers Brendan McFadden and Ben Stambler, return to theaters with Cold Weather, a genre-blending mystery set in Katz’s damp, gloomy hometown of Portland, Ore, about a directionless guy who plays detective when his ex is missing.

Speaking to the director over the phone, one of the first things we had to discuss was Cold Weather’s budget, which Katz revealed was in the “low six figures,” a tremendous amount considering how much his previous movies were made for.

“For us,” he begins, referring to himself, McFadden and Stambler as “us” or “we” as he would throughout our conversation, “it was a ton of money. Even by independent film standards, that’s not a lot of money, but we’d made films for two thousand dollars previously. It was really great to have a little more money this time and be able to do things like pay the crew,” he laughs, “especially because the crew we were working with worked on our first two films. We went to North Carolina School of the Arts, and everyone on the crew went there. It was great to have people taking three weeks out of their lives and not doing it for free.”

Though it’s dwarfed by almost every other budget in Hollywood, making a film for under a million dollars, which is still a lot of money, is a tremendous feat. Asked what he feels is the most important element to focus on, Katz says without hesitation, “the performances. If you don’t have good performances, it doesn’t matter what else you do. There are a lot of ways to stretch resources out or make a movie look like it cost more than it did, but none of that matters if the performances aren’t good.”

Asked what inspired him to be so tenacious at the start of his career, Katz chuckles and says, “We saw a lot of people who graduated from film school, not just our school, but any film school, and not make movies. They had ideas for projects but kept waiting for some magical combination of something to happen to get money to make a movie. And, so often, people would just not make a movie. Coming out of school, our goal was just to find a way to make a movie and not a way to not make a movie, if that makes sense.”

For Dance Party, USA, McFadden suggested the three friends tally up their resources and devise a plan.

“We had someone who could cut the film and owned a camera, we went to Portland where I have a lot of friends and family who could help us out, and we could stay at their houses, and we figured out how much money we had. It was just about $3,000, and that’s how much we made the film for.”

Because of their lack of financial scope and focus on naturalism, Katz’s films are often classified as “mumblecore.” Asked how he feels about the definition and to describe that brand of filmmaking, Katz replies, “I’m so glad you asked! It gets brought up a lot in Q&A’s and probably half the audience has no idea what’s going on.”

He explains that mumblecore was a term coined by Andrew Bujalski’s (Mutual Appreciation, Funny Ha Ha) sound mixer one night at a bar during South by Southwest when asked how he’d describe Bujalski’s movies. An unknown journalist picked the word up and used it to categorize films by filmmakers such as Bujalski, Katz, the Duplass Brothers (Baghead, The Puffy Chair) and Joe Swanberg (LOL, Hannah Takes the Stairs).

“Generally, they’re low-budget, self-financed movies that have naturalistic performances, often with actors who aren’t professionals,” Katz says, adding, “Mostly, what we had in common was we wanted to make films from the real world, and we wanted to find a way to make films when no one was going to give us money.”

Cold Weather releases in select theaters Feb. 11.