In the New Music Industry, there is no shortage of ways for people to raise money for projects. Here are just few examples of funding sources:
- Investors. Running your festival through a limited liability business and reaching out to people to invest in that business. Start with friends and family as potential investors and work your way outward.
- Loans. Depending on your track record and the tangible assets of your festival properties, you might be able to get financing for your event. It is likely that your festival might include a combination of equity investors and financing.
- Crowdfunding. Music festivals are great for crowdfunding projects. Using a platform like Kickstarter to fund your festival could (1) help get your festival funded and (2) guarantee attendance at your festival as you could give your backers tickets to your festival in exchange for their contribution. Some countries even allow for equity crowdfunding, which would let you sell shares in your festival to backers.
A few words of caution:
First and foremost, GET A GOOD LAWYER (OR MULTIPLE LAWYERS) TO HELP YOU! You will need lawyers to set up your company, raise money legally, and manage the legal aspects of your event. Music festivals are a legal nightmare, and the potential liability exposure is staggering. Contracts, corporate issues, insurance, permitting, alcohol laws, talent management...it is insane, and it would be reckless do this work without good counsel.
Second, make sure someone on your team has experience in putting a music festival together. Bonus if that someone has organized festivals at the specific location where you want to hold your event. It makes things a lot easier when your guy knows all the guys to talk to for getting things done at the site. Festival operations are ridiculously complicated, and things can get messy quickly. There is no substitute for experience.
Third, don’t bite off more than you can chew. There is no shame in starting with small festivals (or even doing online music festivals) and working your way up over time. If you want to see what happens when people take on a bigger event than they could handle, just Google “Fyre Festival.”