Like in any industry, the amount of risk in financing creative enterprises varies significantly within the sector. Exactly what a business is doing is, of course, a key factor. The greater the number of variables, the higher the chance of failure. So a feature film from a first time director, with a fair chance of going over budget and whose commercial success depends on its critical reception will be a higher risk. A production company with a long track record, a solid client base and strong management team, is likely to be a much safer bet.
Whatever your enterprise’s risk profile, there are options open to you. Loan finance is likely to be more suitable for lower risk businesses and investment for those with a higher risk profile. If neither are appropriate then crowdfunding and grant funding may be a better fit.
When approaching financers, the key thing is to be exceedingly well-prepared. Think a trip to Dragons’ Den. Know exactly how and when you intend to use the money and crucially how you intend to pay it back. Bankers, investors and grant funders will want to be sure they’re not throwing their money away. Have a solid business plan detailing not just the financials, but the strength of your management team. Funders want to see a strong track record, so celebrate your previous successes and emphasises your experience. Having had an accountant or other advisor check your figures and proposal will really support your case. Be realistic in what you’re asking for, don’t expect a blank cheque and don’t get creative with the accounting.
Who you approach is also key. Specialist funders will know your industry and are likely to have seen many similar proposals. As such they’re more likely to be able to tell what you’ve got right, and crucially anything you’ve missed and where you’re going wrong. Talking to a specialist won’t guarantee your success, but is certainly a good place to start to find the finance you need for your proposal to thrive.