Entrepreneurship – Starting A Theatre Company

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BearMoney Team

BearMoney Team

BearMoney is the balanced finance blog for new and old Canadians alike. We are a team of people living international that research, write, and share

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Can You Make A Living From The Arts?

The first in a series of articles sourced from people involved in different areas of Entrepreneurship. This month we are looking at how to start a theatre company.

There are many among us who are under the impression that being an entrepreneur is easy, or glamorous. Those of us who have actually taken the plunge to start our own venture whether economic or social, know different. It is a long, lonely, and stressful road fraught with dangerous pitfalls and high chances of failure.

There is no single industry where the risk to reward ratio is more skewed than that of the performing/creative arts. The top 1% make bank while the rest likely wait tables (and this is just the employees). Succeeding as an owner is an even taller order.

Most of the reasons as to why this is difficult are obvious . Whether it is funding, income, outreach, community backing, etc, the environment is hostile. There is a problem for every solution. But when you do start a successful company the personal and community benefits are endless. But how do you start a successful one? 

The fact of the matter is that a large percentage of people who work in a creative field would count themselves very lucky to receive even a penny for the amount of time they spent at work. Because the arts sector is vastly oversupplied with talent it frequently leads to long hours spent outside of a traditional 9 to 5. When working in the creative field even a genuine “Thank you” can be rare. Again, the top 1% will be adored, but that guy at your community theatre? Not likely.

Do not let this stop you. Yes, the theatre industry can sometimes be an ungrateful one, but there is a reason why we keep coming back. Personally I don’t believe that “Theatre can change the world”, but it certainly can turn your community around for the better. The success of a creative venture is always highly impactful.

Find Your Community 

The most essential part of a theatre is community. When we say “community” we don’t mean the cliques of performers, playwrights, designers etc that will soon be darkening your doorstep. We mean the volunteers, the attendees, the patrons, the people who will support the establishment financially and physically. 

Customers of the arts are notoriously fickle, and you must never treat them as ‘clients’ you must treat them as community members.

What the theatre does in return is various forms of  outreach, such as fundraisers, local support for change, kids theatre (known to the parents as “less expensive daycare”) and more. In addition, and not to be too cynical, nothing boosts the economic value of a town like a known cultural scene. 

Theatre jazz hands

Before you do anything you need to work out how your theatre will benefit your community. Don’t be afraid of getting creative. Really look at your community and find a way for your theatre to better it or compliment it. 

Note: The community are the people living in your space as they are not as you or your fellow artists might want them to be. Theatre can inspire reflection if not subtly, but you have to do it right.

The first thing you must ask yourself is “Does this community require a theatre?”. We all like to think that all communities need a local theatre. But if the pandemic taught us anything it is that theatre is not an essential service.

Unlike other art forms, theatre has an exception above all others, that is, if your first experience at the theatre is bad, you are likely to never go to any theatre again. No one has ever heard a bad song and said “music is not for me”. This is a contributing factor to the phrase “caught the theatre bug”. So you must be 100% certain that your community will support this venture.

Your ‘market research’ will have to be thorough and grounded in actual people rather than abstract surveys etc. If you have a feel for your town/city, you have a feel for the viability of a theatre.

Forget About Your Artistic Purity (To Start) 

Art and Business Must Coexist

Saying “I want to start a theatre company” is just that, words about risk taking in a post COVID world. The reason for this is very simple. Before COVID, theatre wasn’t exactly culturally thriving. A lot of theatre people undergo an “artistic journey”, which is as much about themselves as it is about their craft. What this inevitably leads to is the unsustainable idea that theatre is for theatre fans or the ‘artistically educated’. For a business this is the equivalent of saying that your burrito truck only makes recipes for food critics and chefs. Good luck surviving.

Starting a theatre company is much more practical than just tutting into a vegan wine glass at the latest Marvel ‘movie’. The artistic message is only as powerful as the functional company behind it.

There is a general belief that theatre can change the world, and because of the fact that art is a powerful medium many people are seduced into being their ‘purest’ self as an artist. You’re going to make people change their political views with your tear-jerking play about roller skating chicken farmers in rural Canada. You are part of the cultural vanguard!

You’re not. What you likely are though, is a trained professional that can use the medium of theatre to entertain and challenge. Your art is only relevant so long as it stays within the ratio of challenge to entertainment that your community wants.

Keep it simple and entertaining. James Joyce should be a swear word to your company. 

The real world isn't sparkles and dancing

Fit The Content To Reality

As we previously mentioned the world was quite happy to shut all the theatres down during the events of COVID-19. Many theaters were closed much longer than stadiums, arenas and even restaurants. To make matters even worse, the theatre world responded by using the internet to their “advantage”. 

Hello virtual theatre on Youtube. The intention was to bring the world of the theatre into the homes of people around the world during the many lockdowns we faced. The virtual theatre experience on the whole was a stream of monologues, sense and short plays all carrying the same message, the hardships and struggles of living in a pandemic. 

But there was a serious problem with this. Understandably the theatre community panicked and tried to act fast. In their panic however, they forgot one key thing: Using Art to highlight suffering doesn’t work when everyone is suffering. Covid was not the time for stoic interpretations of the plight of the downtrodden or the enlightenment of the ‘working class’.

We live in a world of non-stop information, which is flowing 24/7. Everyone felt like the world was going to hell and people were at each others throats. Nobody wanted to hear a message about the virtues of Communism told through drag queen sock puppets. 

This may sound harsh, but it is actually quite necessary. There are times of great political strife and change when theatre can light a spark in people’s hearts. There are also times of strife and change where people literally need to watch a play about an goofball vape seller trying to make it big in NYC.

As an artist you are taught to read the room. As a company director you have to not only read the room, but read the prevailing mood in the wider world. You have to meet your community as they are not as you would like them to be. Only once you are established can you pencil in creative jaunts into postmodernism.

white paper with note

A Sample Theatre Operating Plan

I’m sure, like everyone else who ever dreamed of starting their own theatre company, you have a list of all the shows you want to do. And like everyone you would like to do them now! Right now! But don’t let your excitement take over. Many years ago I got some good advice from an artistic director which proved to be very wise. He said, “plan your season like a dinner menu”. 

If you monitor the season of your local area you will get a very good idea as to when the tourists come rolling in. Tourists are a key factor in the financial success of any theatre in any community. To take advantage of this it is imperative that you plan your “main course” and “dessert” (The big shows) around their arrival and departure. Remember you are both an artistic and a commercial entity.

To succeed in business you need to know not just what products to bring to market but when and to whom. It’s not as difficult as it sounds, you just have to follow the money and the foot traffic.

Below we outline a 10 show roster for a sample season. This is a more business-minded approach that still allows a bit of artistic expression. This model is likely to lead to a small surplus but can be tweaked. The more artistic the less profit and obviously the more basic the more money you’re bound to bring in.

Top Season is for Risks 

In the off season (the season with the least footfall in your area) you can select ‘artsy’ or unkonwn plays for shorter runs. This is the time of discounted tickets with content aimed mainly at committed locals and other theatre professionals. 

These are the shows where you can take risks. Perform more raunchy material, try out new actors and directors, produce new plays etc. The number of attendees will vary greatly from a packed house to as little as three people in the audience. This is to be expected so don’t panic.

The idea is that you establish yourself as an entity in people minds or if you’re already established, you give new life to the artistic flow of your theatre.

It this phase you have two goals:

Build/ Refresh the profile of your theatre

Break even over your ‘short season’

Main Season is for The Popular Girls

The next three shows should complement the latter. Remember that your local community is still here (and have always been here). So you need to ease them into your season and make sure you are not just playing for the tourists (even though you actually are). 

You should consider a big well known as your final show to highlight your main stage season. Something that everyone knows like Death of a Salesman is sure to hick up ticket sales, if you can afford the rights of course.

You should spend at least a half of your season informing people about your summer musical in curtain speeches, social media, and newsletters etc.

In this phase you have two goals:

To make a profit

To garner good reviews and boost your social media

Tails Season is for The Family

Select three shows to bring the audience down again, not emotionally, but so that it is obvious that decline in attendees is due to the tourists leaving and not the show itself.

This is the perfect time to produce shows of a comedic family nature, or content that will address any up and coming holidays. Something to complement the weather of the season and to warm-up for the Christmas show, or holiday event.

Always finish with something soothing. You can never go wrong with a family Christmas show. The best thing about this experience is that it becomes a family tradition. This is something I like to call an “emotional investment”. Emotional investments are very dependable forms of financial security. However, avoid musicals*, they are prohibitively expensive and can cost thousands of dollars in royalty fees.

Creating good memories, or facilitating an environment for them to transpire will make people care about your theatre. Before you know it your patrons will be bringing their kids, grand kids, nephews and nieces and neighbours. And eventually you will have to host a fundraiser to expand your seating and auditorium. 

In this phase you only have one goal:

Make a profit

*Musicals can be very popular but require you to confidently estimate attendance and ticket prices to be viable. A production of ‘Annie’ is going to take ticket prices of $20-25 with mostly full houses.

Making money from theatre is tough

Actually Making Money From Theatre

Finally we arrive at pricing. The standard price for a ticket in the independent theatre circuit is roughly $10. This would be applicable to most theatre styles be it Kid’s theatre, new writing, classics, etc. But this is under the assumption that the actors and the ensemble are getting a nice “thank you” card and not a check.

When you are starting out it is best to keep the price as low as possible, because no one is going to fork out $25.00 for someone they have never heard of.  For now just focus on getting enough in to cover production costs and theatre bills.

In order to get ACTUAL money flowing into your theatre you must produce at least one BIG show a year. If you can afford a musical great, otherwise you will be looking at a festive or new exciting play. Finding one within your budget that will still knocks peoples socks off will be your biggest challenge.

The big event is also a great way of spreading the word. If there is a good turn out, it creates community awareness. But don’t get carried away just yet. Though you may be able to hike up the price of the tickets, remember you will need to hire help. Musical directors, musicians, possibly a huge cast, and more than likely a dance choreographer. None of these are cheap by the way.

You really need to ask yourself ‘am I a $25 theatre yet?’.

A sample structure based on our ‘phase’ approach above might look something like this:

Top Season – $10 for the artistic and low risk events

Main Season – $17.50 for the big ticket items

Tail Season – $14 for normal, $17.50 for Christmas/holiday, $25 for a big ticket musical

Alternative source of Revenue

One great source of revenue for your theatre would be sites such as Patreon. These sites allow your patrons to quite literally become patrons by funding your theatre at a continuous level.

Normally you have tiers of funding and provide extra perks the more money people give. For example, those that donate $15 or more a month might get front row seats or their name in the back of your program. $5 patrons might be invited to monthly talks about acting etc.

This is a very popular and easy way to ensure stable revenue. It also builds a community and provides great feedback for your development. In the world of theatre $500 a month of guaranteed income can keep a small company from going bankrupt.

It’s 2021, your art needs to be multimedia, that is not up for discussion.

All things considered, if you use your time wisely, maximise outreach, and hire passionate but realistic people, you will thrive.This entire business strategy can be summed up in on key quote:

“Always be beautiful. Always be dynamic. Always be welcoming”  
Director Yukio Ninagawa

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