The biggest challenge for many people working in the creative sector is that they have never had any formal business training. One day they are programming a synth, the next day they are running a studio, or one day they are doing the sound for a friends film and the next day running a post house. Well, not quite the next day, but there are so many people who have found themselves accidental business owners, perhaps you’re one of them? Well if you are, then there’s hope, you might have got here by accident, but you can still take control of your future.
Here are my top 5 tips for making sure you not only make a living, but a great one.
Remind yourself of why you are doing this.
You may have started off as an editor or mixer who now owns a facility and wondered how it happened. You’ve worked hard and made sacrifices to build this far - but it might be the case that the spark that got you making a living from music or audio has been lost under all the everyday business. If you feel like this, then you need to rekindle your passion for why you do this. Ask yourself where you want to be at the end of this journey. What do you want to build and what you want to leave behind when you pop your clogs. Great businesses are driven by people with big visions and a big passion. Listen to the story of Simon Hayes if you want to know what I mean.
Link your personal wealth to your business plans.
The important thing you need to ask yourself when running your own business is ‘what do I need to earn to stay alive?’ Once you have figured this one out then ask yourself ‘how much do I really want to earn?’ Once you have figured this number out, then you can start crunching the numbers of getting from that big number to the day-to-day reality. If you want to earn $100,000 a year and charge $100 a day for your time then it doesn’t take a brain surgeon to figure out that isn’t possible. If you worked every day of the year, then the most you could earn would be $36,500 before tax. In reality, taking into account that you won’t even work 5 days a week or every week of the year, on that rate, you are likely to earn around $15,000, that’s before you’ve taken out the costs of running your business, which leads me to my next point…
Profit is what you don’t spend.
Given to me by my Dad and it doesn’t get any wiser than that. Whilst it might be nice to have the latest mixing desk, microphone, car, phone - whatever takes your fancy, everything you spend is taking away the profit. Profit is the money left when all the bills are paid and if you are self employed then that’s your income. I just did a huge shoot for some clients. We shot on some very nice Canon C300s with top prime lenses, as well as all the other gear for the shoot - around $200,000 worth of gear for 4 days. Owning that gear would be nice, but hiring it was smart. It allows me to allocate a cost to a job, not create an overhead for my business. Whilst I’m on spending money - don’t buy into the ‘we can write it off against tax’ myth. What you can do is reduce the tax burden on your profits - if you haven’t made any profit then it’s pointless. Don’t do things for tax reasons - do them for profit.
Work with great partners
Owning a big company and having a studio full of staff may look impressive, but you’re not being smart if the cleaner earns more than you by the end of the year. I work from home and have great partners. Great studios, great post houses, great engineers, great producers, all of them are top of their game and people I can trust. My reputation depends on them being the best at their job. I would love to have them working with me every day, but I can’t afford to pay them every day and they couldn’t afford to work for me on the rate I need to pay them. Which leads me to the second part of this point, I over-pay my partners and I pay them immediately. You might think this is dumb, but people this good are in demand and if they have to choose between two projects, then I want them to chose mine. Which leads me to my next point…
You can only raise your prices when you raise you game
If you want people to pay more for your work then you need to raise you game. I had an office in the heart of Soho, the creative sector in London. There are more post houses and studios in four streets than possibly the whole of the rest of London, which of course means you can almost trip over talent when you walk down the street. Being a dubbing mixer in Soho is hard work and if you want to work you have to be good, if you want to work on really good stuff then you have to be really good and of course if you want to work on the best stuff, then you have to be the best. When you’re the best then you can almost name your price, then you can start to enjoy the overnight success it took 20 years to achieve.
There is nothing better than doing what you love as a job, but if you are going to make it your business, then you need more than luck to take it from good to great!