In order to attract the attention and financial resources needed to produce Northwestern, Mark decides to complete Coven (which he mispronounces with a long 'o'), a horror short that he began shooting in 1994 but ultimately abandoned.

Bill hesitantly agrees to invest in Coven with the goal of selling three thousand VHS copies, which Mark says will raise enough capital to finance Northwestern.

After an extended post-production process, during which Mark occasionally sleeps in an editing room at the University of Wisconsin–Milwaukee, Coven is finally finished minutes before its premiere at a theater in Milwaukee in the summer of 1997.

The site's consensus reads: "Well worth watching for film buffs and anyone who believes in following your dreams, American Movie is a warm, funny, and engrossing ode to creative passion".

[5] Janet Maslin of The New York Times wrote that the film conveys Borchardt's passion "Insightfully and stirringly, not to mention hilariously", and that "for anyone wondering where the spirit of maverick independent filmmaking has its source, you need look no further".

[7] Amy Goodman of IndieWire called the film "an inspiration for filmmakers everywhere",[8] and Kevin Thomas of the Los Angeles Times wrote that it "is sure to draw lots of laughs".

[12] American Movie was released on DVD by Sony Pictures Home Entertainment on May 23, 2000, as a "Special Edition" including deleted scenes, Coven itself, and a commentary track by Chris Smith, Sarah Price, Borchardt, and Schank.