Setting Up Your Business: The Basics
You could be fresh out of photo school, or mid-career in corporate America and ready for a change. You're likely wondering how to get started setting up a photography business. What are the nuts and bolts you need to turn your dream into a reality?
The first place to start is assessing what the market is like. Find the artists, both in your local area, and where you aspire to expand to (Regionally? Nationally?) and assess what their strengths and weaknesses may be. What can you offer that makes you unique? It'll probably be your one-of-a-kind way of crafting visuals, partnered with your branding and ability to meet your customers' demands. Try not to get discouraged at this point in the process; sometimes, it seems like the market's already cornered. It's always worth exploring your ambitions further. Also, get a sense of the type of local clients, especially for photographers/directors who have more logistics to contend versus illustrators or digital artists.
A business plan is an excellent way to set your business structure and outline how you want to run and grow it. If thinking through all the ways you're going to finance, run operations, and interact with your customers is too overwhelming, start with a positioning statement (what you want to create and who you want to create it for). Then move on to gathering some visual references (either images that inspire you or that you've shot yourself) to get a foundation going.
An example of how a positioning statement may sound: Jane Caine is a fine art photographer specializing in creating images that leave the viewer with questions. Her photographs are conceptual, humorous, bold, and in some cases, uncomfortable. Jane's passion for the human form and exploring the limits of identity outside that form are apparent in the bodies of work she creates. Her work can be seen in fine art galleries & museums.
If you want to start lean, invest in just the basics, and rent the rest when you need it. When you get beyond the point where that's a practical option for you, if you want to grow, you'll need to start thinking about how much funding you'll need to build the kind of business that you're envisioning. Once you determine what you need, think through your options, starting with the ones that will protect you and your company's equity.
Self-funding (either leveraging your savings or through a credit card –of course, beware of interest rates) or crowdfunding from family and friends (who are more likely to offer a fair and fixed interest rate) are the best options for maintaining control of your business. Business loans (banks, SBA, online lenders) often require proven cash flow to obtain, which most companies will not have in their first year of operations.
If neither of those are options, investigate a family office. A family office usually has large sums of money, but aren't necessarily in the investment "game" and have financial advisors to manage their wealth's growth. Typically, when a family office invests, your business would be a piece of a more significant financial portfolio. They're more likely to take bigger risks and are likely to take less equity with no business involvement.
If self-funding, crowdfunding, a business loan, or a family office don't work out – seeking an angel investor is likely your next option. Again, be wary of giving up too much equity and control of your business.
Some artists have a studio space; some don't. If you don't tend to shoot in a studio, don't sweat not having a studio address. But, it is wise to have a PO box for your business that's separate from your residential space, mostly if you don't own, have privacy concerns, or have HOA or zoning restrictions related to your home.
Suppose you have a business space, whether a studio or your home where you're managing equipment and meeting with clients, you'll want to have business property insurance and liability insurance. Your homeowner's policy won't protect you against equipment loss or any damage to another person or property while visiting your home-based business.
Most artists start as a sole proprietorship/partnership and convert their structure to an LLC later, once they've tested their business and need to consider things like creating a divide between their personal and business assets, as well as how their profits/losses affect their taxes. If you're ready to set up shop and don't need to test the waters, set up an LLC to start, as it's relatively quick and easy to do.
Pick a name for your business that reflects you and your brand's identity and accurately describes what kind of business it is. Hire a designer for your logo, if needed, as this is the face of your business. Fiver is suitable for a range of budgets; Dribble is a superb higher-end resource. Most artists have just their name + their medium, i.e., Joe Clove Photography, Jenny Swing Illustration. Once you have your name sorted, you'll want to register it as an entity at the state level and grab a domain name. Legalzoom is an excellent resource for registering your business name at a reasonable cost.
Registering your business
You'll need to get an Employer Identification Number (EIN), as it's your federal tax ID, and, depending on your business structure (LLCs, in particular) you'll probably need to register with your state. Legalzoom can help with this, as well.
Separating your finances
Business bank accounts offer many perks that personal bank accounts don't, including separating your personal funds from your business funds, professionalism, and options for a line of credit for your company. Keep in mind, you'll want an account with low fees and excellent benefits. It's good to shop around banks for the best offer.
Starting a business is likely one of the most challenging things you'll ever do, but it all starts with getting the nuts and bolts tightened. As a business owner, you'll always need to be concerned with your product (your talent), marketing, sales, and finance. These four components are the bones of a healthy business, an absolute necessity, and can't be achieved through any shortcut.
The goal is to grow your business so that you can have other employees or resources to work on the parts of the company that aren't your strengths or you don't enjoy so that you can focus on being creative. It takes 100% commitment to run a business – and even the best business ideas in the world can fail for reasons in and out of its control. If you're unsure where to get started thinking about marketing, sales, and finance, check out our blog articles and guides on the topic. All that said, it all begins with enthusiasm – so best of luck to you on your new adventure!