PDA

View Full Version : Looking for funds for my studio!!!


inija
05-15-2008, 03:29 AM
Hi everyone, I want to run my own music studio and for that I need a little funding from reliable sources. I am 28 years old and I am looking for flexible options for going about this. Can you people suggest me any ideas.

Thanks in advance!!!

ngarjuna
05-15-2008, 04:25 AM
I'm not an expert on funding by any means, but I have some limited experience in trying to generate funding for high dollar, high risk productions (particularly film production). Some of the methods were somewhat successful; others did not work at all (for me), but they can.

You didn't specify where you are (in the world). I suspect most of my knowledge applies pretty well in America but I cannot speak for anywhere else, I know nothing about the laws in other countries. I'm also assuming you don't have a couple of very rich relatives; if you do, that is by far the best route you can go (I have seen several project studios start up quicly this way), but unfortunately that's not an option for folks like me.

1) You can always try to go the 'traditional' route: write a very detailed business plan and get a loan from a bank. Banks are going to be very hesitant to loan money to a project that is anything less than tried and true; this means that if your experience isn't very strong, if a recording studio is considered high risk (which I believe it probably is), if you don't have some kind of collateral, they probably won't be interested. However, an experienced studio person looking to break off and open their own with some collateral might be able to convince a bank that it's a worthwhile investment. My understanding of this route (which is very limited, banks are really not interested in film production which is considered HIGH risk, so I've never gone this route) is that you will be personally responsible for the loan; in other words, if the studio crashes and burns and you have to declare bankruptcy, I believe the bank will still hold you to the terms of your loan. If you go this route, hire an attorney who can clearly give you all the rules and implications (something I cannot do).

2) Venture Capitalists are much more interested in riskier projects than bankers are. In a VC situation, expect to pay back higher rates on the loan (it's an investment, after all), but potentially with less personal risk. The last time I looked into this subject (it has been several years already; this thread is reminding me how much I detest looking for funding heh), one of the strongest contenders for startups is an "Angel Network". These are venture capitalists who are willing to make investments in companies which, by traditional standards, are very high risk, but still show a lot of promise. Again, you're going to need an attorney (or someone with that knowledge) to walk you through the whats and hows. The best "in" to an Angel Network is to either know an investor (who could hype your plan to his fellow investors) or hire an attorney who knows the investors. They tend to trust people that have made them money before in the past more than a Johnny-Come-Lately that they've never heard of before.

3) Private Funding is by far the safest in terms of personal liability. You can make an LLC, get your private loan/investment based on the terms you set with your investor, and off you go. This method sounds the best, but it has some limitations: There are very particular rules about seeking investment in this country, and you cannot just go around asking 1,000 people for 1,000 dollars to open your studio (which is a shame, that would probably work more effectively for a lot of us than asking for bigger sums from smaller numbers of people). The general standard, last time we looked into this, was that you could only offer your project to a certain number of investors AND the investors had to meet certain standards: how much capital they have laying around, their investment history, etc. Our attorneys usually required us to have the prospective investor sign NDAs and also documents which stated that they met the criteria to be offered an investment opportunity. I found (personally) that inexperienced investors (and let's face it, an experienced investor is much more likely to look for a tried and true investment than to jump on board with something less traditional like a studio) are not at all keen to signing these agreements detailing that they have X millions in capital for investment and other details about their investment history. To an experienced investor looking for 'something different', signing this form is not a big deal. So it might potentially limit the 'company you keep' in terms of who you can offer it to.

Any way you cut it, you're going to need:
1) A very well written, detailed business plan. Even a private investor will need to see that this isn't just some random idea that you had and a good business plan can demonstrate to them your long term plans. Remember, you're trying to prove to someone that they can make money off this investment (that is generally all that an investor cares about, no matter how "cool" your idea is).

2) An attorney (or at least someone with the skill set; a real attorney is better but I've met investment advisers who were not and still managed to do a good job). You'll need an accountant when things get rolling, but you should be able to get by without one until you actually have some funding on the line (or close to it). An attorney can also help you sell your idea depending on who he knows; investment attorneys who know lots of investors don't come cheap (I think we paid about 300 an hour last time this came up), so it's easy to get in debt simply trying to produce the documents necessary to get it off the ground.

This is a pretty limited view of investment procurement (I am in no way an expert, you should be using an expert to find your funding), but maybe it will give you some ideas of who you can start talking to.

jawjco
06-27-2008, 06:55 AM
I'm looking for funds too. Anybody interested in money-mentoring me? I would even appreciate some good advice. Like, what would be the best and best-budgeted audio interface to use with Reaper? I want to get clean audio into my DAW.

Jidis
06-29-2008, 11:32 PM
Not too sure about this.

http://www.gearslutz.com/board/music-computers/198332-looking-funds-my-studio.html

http://www.gearslutz.com/board/rap-hip-hop-engineering-production/198335-looking-funds-my-studio.html

probably more

Why this particular field?

Jidis
06-29-2008, 11:40 PM
Yikes!

Google Results (http://www.google.com/search?hl=en&q=%22looking+for+funds+for+my+studio%22&btnG=Search)

the names have been changed to protect the...

aeon
07-14-2008, 09:23 AM
have you considered a career in crack?

(sorry)

dazzathedrummer
07-15-2008, 03:08 AM
One way to get started is to go and see some local bands and offer them good rates for recording(or free time - say three tracks over a weekend or whatever - and then give them a price for recording extra tracks), this will start a buzz going around locally about your tallents - and, more importantly get some material under your belt to show to other bands/agents/labels.
You could also offer live recordings and charge a good price for doing so.

If you need equipment, hire what you need and factor it into your price.

Pretty soon, you should find that $100 here and $50 there will soon build to $1000 and beyond - and you can use this to invest in marketing.
Should snowball from there.

Remember - if you borrow, you've got to be able to give it back and some. I'm an Accountant by day, so if you've got any queries - feel free to ask!

Also i'm assuming that you're starting from scratch - appologies if your way beyond this!

Jae.Thomas
07-15-2008, 04:22 AM
Yikes!

Google Results (http://www.google.com/search?hl=en&q=%22looking+for+funds+for+my+studio%22&btnG=Search)

the names have been changed to protect the...

omg this almost borders on spam

nah, i hope you get your answers man, ive approached alot of different forums with the same thing at times too ;)

vocalnick
07-15-2008, 02:25 PM
Looks like a Dorothy Dix question being used as a setup for someone to shill Vmusicbook if you ask me...