25 ways to finance your next recording project, music video or major equipment purchase (II)
- 20somethingmedia
- Apr 11, 2023
- 4 min read
Updated: Jan 20, 2024
Continuing from last week’s article…
Two more ways to raise money fast
- solicit family members and friends
If you still need more funds after putting to use all the possibilities of raising cash yourself, the next safest bets are family members and friends. While borrowing money from relatives and acquaintances is a natural for some people, it can be a stomach-churning curse for others. So move slowly in this area.
Even though these casual investors are fronting you money because they care for and believe in you, you’d be wise to spell out everything on paper before accepting and friendly funding. Get it all in writing. Will you have to pay it back, and if so, when? How much will Aunt Gertrude want on your next album if she’s footing the bill? Find out ahead of time and you’ll keep everyone happy.
- Seek out investors
Now we move into a more complicated realm. To attract investors, you usually have to come up with a written business plan that includes budgets, expenses, projected revenue, and countless other tedious details. If you’re uncomfortable with numbers, fine print and selling yourself, traditional investment strategies might not work for you.
Most musical acts that attract investors basically end up making fans of people who have extra money to play with. In other words, investors should ideally have their hearts into what your music and vibe are all about.
Question: How do you find supportive investors? By being sociable and meeting all of your fans. It’s that simple. Plus, don’t be shy about mentioning to people that you’re looking for an investor (or two, or five). In fact, many artists have found it’s easier to find 10 people who each invest $1,000 than it is to search for one person who can invest the whole $10,000.
When you find interested parties, you must demonstrate that you and your music have merit and potential to make money for both you and the investor. Along with a business plan that spells out everything about your music career, clip articles from respected magazines on similar success stories and highlight industry trends based on information from trade publications. Also it doesn’t hurt to list a respected person in the music industry as your personal consultant.
Key: Agree ahead of time on what role the investor will play in your career. Will he or she be hands-on or more of a silent partner? Will the investor be reimbursed through an ongoing percentage of your earnings or only at a specific time, such as when your band gets signed to a record deal? Make sure the details are clear and beneficial to both parties, and have an attorney look over the final agreement.
Four more ways to get the financing you need
use your personal credit
Okay, so you don’t have the financial clout to get a mega-bucks bank loan. Does that mean you’re completely out of luck when it comes to getting credit? Maybe not.
Is there a music store, recording studio, or video producer in town who you’ve developed a good relationship with? If so, don’t overlook the good possibility of getting personal credit from the owner of one of these establishments. This arrangement is basically an informal loan. The business owner, in essence, would front you the equipment, studio time, or service for now… with the understanding that you will pay the fee at a future date when you’re able. As always, be specific on the repayment timetable and dollar amounts.
- Offer sponsorships
Coke, Pepsi, Miller Genuine Draft, and Bud Light aren’t the only brand names that can sponsor musical events. Even though the corporate big guys are best known for it, why couldn’t your local music store or studio sponsor you? You put up posters and pass out fliers promoting their businesses at your shows… and they give you a discount or free stuff in exchange. What a concept!
- Practice the ancient art of barter
Do you have a skill, product or service that would be of value to a recording studio owner, video producer, newspaper publisher, or CD replicator? Well, if they have something you want, and you have something they want, it may be time to put the ancient art of trading goods and services into action. That’s what bartering is all about, and it works perfectly for Guerrilla Music Financing. In fact, it may be one of your most powerful tactics for financing your music venture on a limited budget.
Another angle: what if the business owner isn’t interested in what you can offer? You’re next option would be what I call a Trade Triangle. Ask the owner what he’d be willing to barter for if there were no limits. Let’s say a studio owner needs a new transmission on his car. Perhaps you know (or can find) a mechanic who might be interested in what you have to offer – maybe your band could play free at the company’s upcoming anniversary street party.
Then you create a Trade Triangle. The mechanic gets free entertainment from you, the studio guy gets a new transmission, and you get your free recording time from the studio. Everybody’s happy… and without spending a dime! That’s Guerrilla Music Financing at its best.
- Build your own equipment
That’s right, you read that correctly. Why buy a new, expensive sound system or effects rack when you might be able to build one yourself for a lot less cash? If you have carpentry skills and a working knowledge of acoustics and electronics, this could be a real money-saving method for you – whether you’re building a sound system or home recording studio. Here are several good build-your-own electronic equipment resources:
PAiA Electronics
Digi-Key
Music Electronic Archive
Doepfer
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