Paying For A Passion: Finding Investors For Your Next Entertainment Endeavor

Recording an album, shooting a movie, publishing a book – whatever the pursuit, one of the most crucial elements is finding investors to fund it.

Finding investors, taking advantage of various funding outlets and researching available capital for entertainment deals are significant parts of working in the business, and knowing how to secure what you need is essential for success. There are a number of ways to ensure you’ve collected enough capital to fund your client’s vision. As a manager, producer, agent or anyone overseeing an entertainer’s career, making sure that the art is paid for is one of your primary concerns.

How to woo investors with an idea

Traditionally, investors are a reliable route for funding various pursuits – not just in the entertainment industry either – think start-ups or even political campaigns. Everyone is seeking someone else’s money for something. There are a few key details for finding an investor. First of all, whoever is behind the project has to show that he or she is willing to do whatever it takes to realize its completion. Investors don’t want to pour money into a project that they don’t think is worth it.

Imagine if George Lucas hadn’t been passionate about his Western set in outer space. Who would have shelled out money for such a crazy idea some 40 years ago had Lucas not been passionate about it? When it’s time to present the ideas to investors, use that passion in order to put more than a script or a few songs on display – use it to illustrate larger concepts and ideas, things that people can really latch on to and get excited about beyond the surface of the project.

One good way to do this is to illustrate the potential for indirect revenue sources regarding the project. For example, if you represent an artist seeking investors to fund the independent recording of his or her album, then mention the potential for concert T-shirt and ticket sales, live appearances at events and more as alternate sources of revenue. The ability to explain that there’s more than meets the eye in terms of return on investment will be huge when trying to attract investors for any sort of project.

Capital collected from the crowd

Another way to raise capital for a project is through crowdfunding. In recent years this method has become exponentially more popular as various musicians, movie producers, artists and just about everyone else use it to fund ideas, from Zach Braff’s Kickstarter-funded movie Wish I Was Here to tracksuits advocating Missy Elliot for president of the United States. Especially if the vision for the project is misunderstood or particularly weird, this may be the place to go, because there are people out there who will throw their money at just about anything. The work comes in reaching out to those individuals and convincing them thoroughly enough.

Legally, this could present some snags though, because generally investors offer their funds with the expectation that there will be some sort of profit in the future. Additionally, parties seeking investment are required to register those securities with state and federal governments. This presents problems, because while there is the potential for some sort of return on investment from a crowdfunding donation, ownership stakes in the company, and the type of return that you can retire off of, aren’t to be expected.

This is why when it comes to crowdfunding, the people offering the money are considered backers. In this case, there is no expectation of profit. A simple reward is enough, the project is completed, the owner maintains ownership and the backer simply knows that he or she contributed to it.

Generally to crowdfund a project, you identify a website through which you can raise capital, put together a concept to attract investors, offer rewards for investing such as credit for the final project or an evening with the artist, and get the message out there.

Whichever way you choose to raise funds for an entertainment deal or project, make sure that the passion for the idea gets across. Eventually, with planning, research and devotion, the money will come. For more on your options when it comes to funding an entertainment deal, seek legal assistance. An attorney can offer you additional information on raising money through crowdfunding, as well as searching for investors.