Starting up a professional productiong company. How do i best spend my money?

[Mark Suszko]

For 9 grand, you don’t really have enough to start, for anything more than a bare-bones wedding/event biz. And a list of gear is not necessarily the first thing to spend that money on.

While I would budget for a great editing system and loads of storage, when starting out, I feel you should rent gear only as and when you need it, billing thru to the clients adn adding a markup, so the more clients you have, the more stuff their projects buy you. That way you get what you need for each specific project.

A real production company has a lot of costs associated in running it, not the least of which is insurance, accounting and legal costs.
Then marketing and promotion. The fun stuff, the “toys”… actually comes last after all the boring business costs.

[Todd Terry]

Listen to what Mark says.

But also… lose the Kinos, don’t even consider them. Yes, they are great instruments, but you have almost no budget. Get by with inexpensive tungsten or LED instruments until you have several multiples of that to spend.

I didn’t see any kind of software on your list… FCP or Premiere, After Effects, the Adobe Creative Suite, etc. etc. etc…. that will be a SUBSTANITAL hunk of that budget.

Not to rain on your parade, but there’s probably easily another 9-grand worth of little bits and pieces you’ll find you need to put together even the barest-bones of kits for a professional production company.

T2

__________________________________
Todd Terry
Creative Director
Fantastic Plastic Entertainment, Inc.
fantasticplastic.com

[Nick Griffin]

Ditto Mark & TT. Do you live somewhere without sales tax? In addition to insurance how about accounting & legal fees? Salaries until you start getting paid jobs actually paid? Auto and mileage costs? There are MANY, MANY, MANY more things to consider than equipment.

[Jonathan Ziegler]

When you’re just starting out, don’t buy a ton of stuff. Rent. Rent. Rent. It’s cheaper in the short run and you don’t have to worry about storing and maintaining equipment – let the rental company worry about that. Save the $ for insurance, software, consumables, taxes/licenses, office supplies, Costco memberships, legal/accounting, etc. Consider the Adobe CC route for software: $50 a month for access to Adobe’s entire collection, including Premier and After Effects ($600 a year, I’m so glad Adobe finally started offering subscriptions as their products just got considerably cheaper: $600 a year instead of nearly $3k every 2 years for me). Rental companies want you to either have insurance or provide a deposit or both so your spare cash can go there. Also, if you spend all your cash on equipment, you have nothing for hard costs, marketing/advertising, consumables, etc. Don’t forget, that laptop will become obsolete sooner than you think and you have to either replace it or upgrade. Consider a more robust machine for home/office, too (I even like the iMac with an i7). Also, unless you already have a network of paying clients, you will need to spend lots of time working your sales for the long term (repeat business, solid referrals, etc.).

Good luck!

Save early. Save often.

Jonathan Ziegler

http://www.electrictiger.com
520-360-8293

[Jong Cardenas]

Thanks for your advice. Would you say that it would be better to rent or purchase a camera? And would the black cinema be a good pick?

[Jong Cardenas]

What are examples of a robust computer?

[Jong Cardenas]

Also 2hat computer do you recommend? Laptop or desktop or both?

[Jonathan Ziegler]

It depends on you, really: with $9k, I’d say rent everything. It allows you to work with multiple cameras for various uses and if you find one you consistently rent, hopefully you’ve made enough money to buy it. 🙂 Find a good rental house and ask around too. They want your business for the long run so they’ll help where they can. As you build your skills, some things are better bought and some better rented.

Also, most production places I’ve worked with rent cameras, lights, gear, stands, electrical and the like for their projects. When the project is all done, everything just goes back to the rental houses. They keep all the cards on multiple disks and backups which go out to be edited at the base of operations in wherever and the crew go home. It seems to work for them since each project is a sort of ad hoc solution and needs are different each time. You’ll figure out the type of gear you like to have around for each situation. You’ll learn to price equipment rentals into your estimates – they’re usually posted on the websites, too.

Save early. Save often.

Jonathan Ziegler

http://www.electrictiger.com
520-360-8293

[Ned Miller]

Stop! Don’t do anything yet. The above posts offer great advice, exactly what I would say and here’s some more .2¢:

I would need to know what city you are in and the rental resources to know the viability of renting vs owning, but you can also rent from private owners, which is my first choice because the gear is treated better and the pick up/drop off hours are more convenient, but…

I can’t address the post gear however, I often advise clients and newbies as to production gear. First off, do you presently have a van or large SUV to transport? As to your list, the only usable item I saw for a start up was the Rode. As mentioned the Kinos are overkill. They are very useful when you need an even flat light over a wider area such as doing green screen but otherwise are expensive for what they do plus they take up a LOT of cubic inches once in their cases, which relates to the issue of the vehicle. The most important thing I can impress upon you is that you need to have a client base that desires the particular package you plan to put together BEFORE you buy the gear. There is no such thing as “Build it and they will come” in the vid biz. I have been freelance for 35 years and have seen many dozens of prod cos large and small go under. So…the purchase of gear that is not consistently billable plus fixed expenses such as office rental, insurance payments, etc. will drag you under when there is a cash flow crunch.

If I have not yet convinced you that buying gear is not wise during the start up process, then continue reading. IF you have the money and gear addiction that compels you to own, the first rule to consider is: Is what I am buying going to be cheaper to own than renting? Most likely not. Certain items are, the ones that last forever, which is most everything besides camera bodies. I advise young wannabe DPs to put their money in a high quality tripod, lights, monitor and audio after having the bedrock, which is the vehicle. Rent cameras and lenses because they are changing so fast they often don’t pay for themselves before the next new thing comes along. Since you propose producing biopix and corp comm, what you really need is what I call a “Talking Heads & The Usual B-Roll Kit”.

We don’t know anything about your background, if you have a client base, perhaps this $9K is a graduation present? etc…but when you say “start up”, that’s a very dangerous thing because right now I wouldn’t suggest anyone enter the biz now. We have had such growth in video, the graph looks like a hockey stick, but us older folks have niches and client bases, the newbies are suffering unless they grab a good client. Right now the prices for video are rock bottom, it’s a buyer’s market. It’s gotten to be a commodity and there’s crowd sourcing- a race to the bottom in terms of competitive bidding to the point no one can charge a premium. Any chimp that is somewhat technical and creative can now do video. So you’re starting in a biz that would be rejected in any MBA class doing an exercise as to as to what hot industry to get into.

So in sum, use that $ for marketing, establishing a solid, consistent, client base. Do a REAL business plan that has no delusions, keep a lot of money in reserve. Murphy’s Law is the one constant. Hope is not a strategy. That $9K gear list…real red flag, unless that was just for gear and there’s another $20-$30 for the rest? Gear is meaningless without the paying clients.

Good luck,

Ned Miller
Chicago Videographer
http://www.nedmiller.com
www,bizvideo.com

[Francis Maning]

in my opinion, its best to get a credit from any financial institution and keep your money for business operations.