Money is the life blood of any business. When there isn’t enough you may need to look at additional sources to grow your art business
Every business needs money to operate and grow and your art business is no exception. It is important that you have a basic understanding of the various ways to finance a business that are available. Most artists start(finance) their businesses with their own or borrowed funds and use the money generated from sales to fund future activities. For some artists these funds are not sufficient to fund their growth plans or other obligations and they need to raise money.
In this article I will explore the common ways to finance a business. You don’t need to go to business school to understand the basics of business financing. Learn the basics and you are well on your way to keeping your art business viable and growing! In a future article I will take a look at other financing methods such as grants, fiscal sponsorship and crowdfunding.
Every art business needs money to operate and grow and yours is no exception. You don’t need to go to business school to understand the basics of business financing – learn the basics and you are well on your way to keeping your art business viable and growing.
Why you may need financing
There are many reasons why you may need to finance your business. You may need extra capital for a short time or your need for financing may last many years. A few examples are:
Purchase a new studio or building
Purchase new equipment or supplies
Fund living and travel expenses for a new project
Pay back high interest loans
Provide working capital for operations such as marketing, rent, employee expenses, etc.
The Two Major Types of Financing
There are many ways to look at business financing and one of the basic ways is to categorize financing into two groups: Your Money, and Other People’s Money (OPM). Most every business starts with using the owner’ or founder’s financial resources. As the business grows and this may be sufficient but for many businesses outside capital is needed.