Visual artists are constantly creating, spending time in the studio and expressing their vision. But how can they create opportunities to help bear the cost of producing projects, whether they need to fund art gallery exhibitions, site-specific installations, or a place to make and store work? In this installment, we’ll review the necessary steps artists seeking to fund art projects must take before they solicit financing partners, and review three key methods frequently used to fund art projects – self-funding, crowdsourcing, and fiscal sponsorship.
There are two main issues to consider when looking at how to fund a project: cost and control. The cost of the project represents your vision for what the entire project is expected to cost; the control aspect refers to which financial obligations you’re willing to take on, and what level of creative oversight you’d like to receive in exchange for footing that part of the bill. The reverse is also true: you may be willing to give up some creative control in exchange for financial unburdening.
In order to get an idea of the scope of the cost to fund art projects, and what it will take to get it done, make an art budget no matter where the money is coming from. It is not necessary to know every detail, but do a break-out of the different components of your art budget- materials, extra labor, transport, installation- and some research on the costs of those things. When the work of breaking down your art budget is already done, it is much easier to seek funding for a discrete budget line or an overage due to an expansion in scope, for example. In the art budget, add a minimum 10% cushion as an allowance for overages, price changes, and unanticipated expenses, or more if you know that the cost of materials or the venue is highly variable. The budget will serve as a guide in determining eligibility for grants, partnerships to seek, material donations, and evaluating the overall feasibility of the project.
There are also practical elements of control that vary greatly depending on the artist and the project. Will you control the purchase of materials or accept donated materials? Must you be present personally for installation and take down? Do you get to approve all images and biographical information used? Answering these questions at the outset of a project, before you enter into a final agreement with a financial sponsor, is an important part of the process.
Plenty of questions can arise in the course of creation and presentation that force you to reassess the nature of control you exert over the work in order to preserve its integrity, and that is okay. Being aware of your boundaries (or lack thereof), trusting your instincts in dealing with others and, most importantly, communicating those delineations to any other people involved in the project- assistants, contractors, presenters- will help ensure that control stays balanced.
If the project is being presented, chances are the presenter will have some form of contract or agreement that is given to you to sign. First, read the contract. All of it. If it is too long or too legal-y or too boring or too full of gobbledygook, have someone else read it and report back. Ask questions. Make sure that words on the paper match the words from the conversations about the project and presentation. Most importantly, do not sign an agreement until any problems have been worked out. Too often, there are promises that the parties will “work it out later” that leave one side with the short end of the stick and no leverage to renegotiate. You don’t want to “work it out” later in court.
Now that we’ve reviewed the importance of finalizing an art budget before you seek funding, let’s review the various types of financing an artist might seek to fund art projects.
Self- Funding Your Art Projects
Most individual visual artists are all too familiar with self-producing. Buying materials, renting an exhibition space or venue, shipping, framing, and marketing are all considerable and necessary expenditures in an artist’s life. Often, initial (and sometimes all) funding comes from one’s own pocket, so try and make the money go a little farther. If credit cards are a funding source, shop around for the lowest interest rates and take advantage of balance transfer options between cards and companies to maintain a low-interest rate for as long as possible. Also, investigate rewards programs that will allow future purchases using rewards money at places that are actually useful for supplies or personal shops. In the event that materials will be coming from other countries and purchased in a different currency (Canada counts too!), look at the credit card terms to see whether or not the company charges foreign transaction fees. Capital One touts cards with no foreign transaction fees and some other companies are following suit.
Another way to self-fund art projects is to look at expenditures as a loan, even if that is from the artist as “person” to the artist as “artist.” Treating the project as an investment will allow a more neutral business perspective in analyzing expenses and costs.
For example, let’s say you create a sales target and decide that you need to sell two pieces in an exhibition in order to recover the costs of the project; the sales goal creates a target and puts cost in perspective. Perhaps the costs are an investment in increased visibility in a particular city, circle of artists, or gallery space. Tracking your success through some data- number of visitors to the exhibition, additions to your mailing list, press and reviews, or sales- will show whether you receive the anticipated or necessary return on investment. If not, you can rethink your strategies, but you will have gathered information about your audience.
The same perspective is helpful if asking a family member or friend for a loan for a portion of the project; create a promissory note and payment schedule and discuss the interest rate of the loan, compared with other possible investments for the lender, and show that the loan will receive a favorable return on investment.
Crowdfunding Campaigns to Fund Art Projects
Crowdfunding can be an effective way of boosting financing. Sites such as Kickstarter, IndieGoGo or go fund me allow an artist to post a project and solicit funds through the site. Often, there are small incentives, such as a photograph, or a personalized art postcard, or something else of value that a person receives in exchange for donating at a certain level, with more significant (and potentially costly) obligations in exchange for more significant contributions. Since people who connect to an artist’s work are interested in being part of that artist’s process and success, thousands of successful crowdfunding campaigns have launched.
Each site has different parameters on how to qualify for the money collected during the timed duration of the campaign; some require that a campaign reach the target goal or no money transfers to the artist; while others transfer whatever is raised in a campaign at its completion, minus the administrative percentage the site takes for hosting the campaign. Compare the different options based on the requirements, the length of the anticipated campaign and goal, and the administrative fees.
Most successful crowdfunding campaigns solicit bids to fund art projects for a discrete line item, such as travel to the exhibition site, shipping costs, or materials. However, several crowdfunding campaigns have raised the entire cost of a project. Decide what element of a project is most appealing to a donor base and what the giveaway items will be in advance of the launch. Most importantly, carefully choose the fundraising goal of the campaign based on the size of the potential donor base, and the depth of social media presence of the artist and any partners or contributors. Set the campaign up for success with so-called “stretch goals” if the first is successful, but ensure achievable initial goals.
For example, if the target is to raise $5,000 and early in the campaign you see that you will raise that money fairly quickly, rather than altering the campaign to change the target, you can add language alluding to what you would do if double the money was raised. Also, take note of your fundraising ability to set achievable but challenging goals for your next crowdfunding campaign.
Fiscal Sponsorship: Seeking Art Grants
Some artists may wish to seek financing from a non-profit or government organization to fund art projects. There a number of arts-related nonprofits whose tax-exempt purpose is to promote and encourage the arts; these organizations also provide fiscal sponsorship to a number of artists seeking art grants funding.
The essence of fiscal sponsorship is that the fiscal sponsor “lends” its tax-exempt status to the sponsoree in exchange for a small percentage of the total amount collected (generally between 3-7%). The effect is as if the project has nonprofit status. Larger organizations, like Fractured Atlas, have a large number of artists and projects in a variety of disciplines for which they act as fiscal sponsor and issue art grants. There is an application that the artist fills out and, if accepted, a page on the funding website will be devoted to the applicant’s project to make it easier to access for funders and donors.
Larger fiscal sponsors also take over the accounting functions for the money it collects on behalf of a project and sends monthly or quarterly disbursements after deducting its fee.
Fiscal sponsorship also has another perk: it allows the nonprofit to give a tax deduction to individual donors. So, Aunt Mildred or your coworker’s friend Graham can log on to a project-specific page and donate or write a check to the fiscal sponsor with a note in the memo line naming your project as the target of the donation. Not only have they helped fund art and the target artist specifically, but they also get a letter acknowledging their tax-deductible contribution to the nonprofit organization.
Even if an artist forgoes finding a tax-exempt fiscal sponsor, if the project is presented by a nonprofit organization that is able to apply for art grants and accept donations, that organization may receive funding. For example, if a nonprofit community art gallery or art space is presenting a show of your work, the gallery may apply for art grants that are based on supporting local art and community enrichment, and write the expenses of the show into the project budget for that grant. If the gallery receives art grants, costs of mounting the show and doing the marketing may be paid for by those grant funds. In this case, project-specific funding may allow the presenting organization to cover all or most of the project costs, creating an additional benefit to the artist. Thus, it’s a good idea to target arts and culture grants as an effective method for funding art projects.
Finally, Use the Funds You Have Put Together to Realize and Create
Once you have gotten the funding together for your project, you get to take off your business and accounting hat and get back to the hard work of creating, hopefully with the confidence that you will be able to bring your vision to life. Having a budget is like a roadmap; as you explore the funding choices you need to move forward, you may certainly take a detour or find a road closed, but you will still be able to keep a perspective on the destination.
It’s not uncommon for artists to go it alone these days and self-fund their own work. However, the decision to fund art projects through outside means – whether with art grants or crowdfunding sources – are entirely plausible and a certain relief for the emerging artist.