Music Funding 101
Different Types of Funding
SELF FUNDING: Saving up money and buying things piece by piece. The money can come from working or from the band selling its music and merchandise. This is how all bands start, and it's good for buying non-real-time things like instruments. Best of all, the band does not have to pay it back. Recommended, if the band members have good jobs.
PARENTAL FUNDING: Next comes asking for money from mom and dad, knowing that the band will do their best to pay it back. But if payback doesn't happen, the band still has their parents, and they still have a good credit score. The biggest problem with parental funding is the lecturing that they get about how music is not the best place to be putting their money (easy for parents to say). But parents usually have more money than the band members do, and if the band members can convince their parents that what the band is doing is really a business venture, there may be a chance. Recommended, if you have well-to-do parents.
FRIENDS FUNDING: This is of course asking buddies for money. No lectures here, but if it's not paid back, the band will lose a few friends. Plus, it's usually hard getting more than just a few hundred dollars from each friend. Not recommended, because bands rely heavily on having friends.
LOANS/LINES: Probably the last chance for bands. Banks have a real problem with any business that has the word "music" in it. If the band did somehow get a loan or line of credit for some real money, failing to pay it back is going to cause the band some real trouble. However, at least there is the fact that if a bank did want to loan the money, there's no limit to how much it could be. It's just based upon what situation the band presents to the bank. Not recommended, unless a band-member or a friend works for a bank and can really pull some strings and give good advice.
CREDIT CARDS: Very popular with bands, mostly for buying instruments. But the credit limit usually is not high enough to do serious marketing and promotion. Recommended, however.
INVESTORS: This is where most bands start looking for real quantities of money, simply because they can "ask" for it without having to fill out applications, and because there is no limit to how much can be asked for. And there is a chance that if it's not paid back, the investor (who usually is just a "person") will just let it slide. Recommended, if the band-member that is doing the talking is good at dealing with people, or has a background in sales.
GRANTS: Often overlooked by bands, getting a grant will many times fill a few money voids, although the amounts are usually just a few hundred dollars. But at least the band won't have to pay it back. In the U.S., however, grants are usually limited to classical and jazz. And in all cases, there is a long, long wait. Recommended, if the band is adept (and fast) at finding and filling out applications (hundreds of them).
SPONSORS: This is the untapped area for bands and is the focus of TalentFunding.com. Whether it's difficult to understand, or because it just seems to be too commercialized, almost no band or indie label really knows how to seek out true sponsorships. That's a shame, because there is more money available for bands through sponsorships than all the other methods above.
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