Budget basics for artist fundraising


Tips for writing a balanced project budget that convincingly communicates your knowledge, intentions, and vision.

Kay Takeda here. I’ve been working in support of the arts and artists for over 20 years with a focus in grantmaking. In this role, I’ve seen thousands of artists’ project budgets. If you are an artist developing projects and actively seeking funding for them, I encourage you to think of your project budget not only as a way to manage the costs of your project, but also as an essential communication tool to help others understand your plans.

A great deal can be interpreted from glancing over your budget: how experienced you are in what you are doing; how familiar you are with the materials and labor entailed; whether your practices are professional; and whether you are cautious and ambitious, or careless and clueless. A clear, detailed budget can help show that your project is more than just a good idea—it also demonstrates that it is feasible. The following tips are intended to help you understand the core components of a project budget, and how to flesh them out to stay on top of things and to tell your story more compellingly.

— Kay Takeda


Part I: The income section

In the income section of your budget, your job is to include your most realistic estimates of potential income. Some guidance on key sources:

Sales and fees

  • Artist Fees: If you will be paid by a venue or organization to present your project, that is earned income! Show it here.

  • Sale of the artwork: Before you include income from the eventual sale of the artwork being produced, consider how likely the artwork’s eventual sale is, and how much of the project that sale could realistically fund. Note that for funders, too much reliance on sales income in a budget could raise a core question about a project they are considering for a grant: if it is expected to pay for itself through an eventual sale, what you might need is a loan, not a grant.

  • Tickets/admission: If you’re selling tickets to an event, show the number or percentage of seats you expect to sell, the total seats available, and your pricing per ticket. Use past projects to demonstrate how you’re making your projections (for example, others may question your ability to sell out every night, unless this is based on past experience and you say so). Ticket pricing will also communicate how accessible this project is to audiences of different income levels, so include pricing tiers if they are part of your plan.

  • Concessions, swag, and multiples: These are great to include in your budget if they are worth the time to make, offer, and sell.


Grants

  • Research is key! Identifying and naming realistic potential granting sources is important. Include only those sources that fund the kind of artist you are, and the kind of activity you will carry out. Funders will expect to see that you are pursuing other grants, and they know one another, so it will be obvious to them if you have listed an unrealistic source.

  • Since it is difficult to predict whether or not you will receive grants, it is best to include one total amount you hope to raise from grants, then name the funding entities you will apply to in order to raise this amount.

  • Do not include the name of the funder you are applying to in the budget that you send them, and subtract the amount you are requesting from them from the total dollar amount you plan to raise from grants. If you do this, won’t your budget be thrown off balance? Yes, and that’s how most funders prefer it: to see a deficit (negative balance) at the bottom of your budget to show them how much you need, and are therefore requesting, from them.

  • Note: Be conservative when estimating the amount to potentially be received from any grant source. Base it on the likelihood of funding (are you a returning grantee, or applying for the first time?) and on the average grant amount awarded by that funder (do the research). Note that it is rare for a funder to award 100% of the amount requested.

Individual Donors/Crowdfunding

  • As with grants, show in your budget the total you are seeking to raise, with a breakdown of target donation levels. If you are basing this on past results and have a strong history of gathering individual donations, make sure to say so.

  • A management note: if you show the gross revenue you expect to bring in through fundraising events or crowdfunding campaigns, then make sure you also include the cost of putting on the event or fulfilling donor benefits and rewards in your expense section.

In-Kind Donations

  • Donations of professional services and materials (in lieu of actual cash) bring real value to a project, and should be acknowledged and shown in your budget. Show in-kind donations in a separate section of your budget, such as notes at the end, not in your income section, as you’d be mingling representations of cash with non-cash, and that could lead to confusion down the road.

  • Assign dollar values to in-kind donations that reflect fair market pricing by finding out what the donor would normally charge for such goods or services.
    Keep it simple. Acknowledge only outright donations of services or materials–not discounts or lower rates.

Secured Funds

  • Finally, no matter what the source, if you have a written commitment for funds (or if the funds are already in your back account), state that that amount is “secured.” Secured income helps boost the feasibility of your project by showing others are already on board.

Part II: The Expense Section

Each artist project will have its own unique set of expenses. With that in mind, here are a few common areas to pay attention to:

  • Artist Fee: Pay yourself for your artistic leadership and contributions to the project. If you are grappling with the thought that it’s somehow not right to pay yourself to carry out your own project, consider that to a funder, if you propose to create and lead a substantial project for free, the endeavor seems less feasible, not more so. Set a single artist fee amount that will contribute to your life expenses and is in reasonable proportion to other expenses in your budget.

  • Personnel and consultants: Show how much each hire will be paid in your budget detail. For example, a breakdown of “five dancers at $X for X hours of rehearsal and X performances” paints a more vivid picture of the project scope than a simple dollar amount allocated for “dancers.”

  • Communications and marketing: If your project is intended for an audience, how will you engage them? There are many free ways to get the word out, but do you need photo documentation of the work for advertising? Will you need to hire a PR consultant? Sometimes the planning for getting a project out there isn’t as developed in proposal narratives as “what” the project is. However, if you make sure to budget for these activities, you are showing that you have a plan in place to successfully reach your audience.

  • Equipment rental vs. purchase: Equipment is often cheaper to buy than to rent, but many funders don’t allow capital purchases in a project budget. For example, buying a video camera for creating footage is a capital purchase, as it can be used for many other projects and purposes. Therefore, always budget for the cost of rental.

  • Expenses related to a professional operation: A few areas that artists may overlook when outlining project costs include insurance (e.g. general liability, workers comp, and public art insurance as applicable); the cost of fiscal sponsorship for paying individual artists (the percentage fee charged on all funds they process); and space rental (e.g. artist studio or office rent).

  • Contingency: Plan for the unexpected. Contingency is a budgeted amount for unanticipated costs (repairs, replacements, new expenses due to project shifts, etc). Calculate contingency between 5% (if you’ve done this type of project before) to 20% (if the project represents a lot of new territory) of your total budget. Funders (and you!) will appreciate your planning.

In summary…

Once you’ve drafted your budget, read it alongside your proposal narrative. Do the two work together to represent your plans and address the funder’s evaluative criteria? Now, share that material with someone who knows about your project, and see if the story your budget tells aligns with how they understand your project. If the budget isn’t helping to paint a vivid picture of your project and your ability to pull it off, adjust your material accordingly. You will then be working in a more integrated way to develop funding proposals that clearly communicate your knowledge, intentions, and experience. Happy fundraising!


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