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Taking Care of Business
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Old May 11th, 2006, 08:28 PM   #1
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$200,000 Video Business

Hi!

So, I've been reading posts here and researching for about a year now. Making videos has always been my hobbie. I've made some news videos, I've shot weddings, training videos, and even made some short films with my Sony HandyCam Digital-8 and my pirated NLE on my home computer.

So, I finally found someone who believes in me and wants to give me $200,000 to start a business... what should I get? I deffinately want HD, and I'm leaning towards the Canon XLH1, and Adobe Premiere Pro for editing. What does everyone recommend? I want to try to keep it under $100,000 for equipment.

Thanks!
Vince Luckey
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Old May 11th, 2006, 08:44 PM   #2
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Get yourself 2 Canons i'd say, then buy a super over the top computer set for HD editing, maybe getting 2 terrabyets of space, and a lot of ram. Buy Adobe's Production suite, Buy a website, buy lots of tapes, 2 good tripods, some steady cam sutff, lots of bussiness cards, and an advertising campaign...

for me, I have only 1 FX1, but I have everything else above, and it has cost me just under 50 grand. If I were you, bank the rest of the money to the day you pay the guy back. Its also good back up...

I envy you, 200 000 is a lot of money. Even for a video bussiness IMHO
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Old May 11th, 2006, 09:08 PM   #3
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I'd start off with a business plan... who is your target market?

$200k might be a lot, or not enough. The post production facilities that target the top ad agencies can have millions of dollars in capital (i.e. $400k-$1,000k for just for a single edit bay). If you want to get into weddings, it may not make much sense to invest more than $40k.

So figure out what your target market needs... and then you know what you need.
i.e. On the technical side, if you want to do broadcast work then you'll likely want a betaSP deck/VTR.
On the business side, you may want your offices to look really swank... that helps (the client) justify a higher rate. However, having offices may not necessarily be appropriate.
On the human resources side, you may want to start at a level you're familiar with. So it wouldn't make sense to get a Avid Nitris|DS, digital betacam deck, waveform monitors, etc. that you don't quite know how to use.

You may also want to find a good salesperson, but that's easier said than done and has nothing to do with equipment. But if you don't have clients, then it doesn't really matter what equipment you have.
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Old May 12th, 2006, 07:50 AM   #4
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I've had lots of experience putting together relatively inexpensive and trustworthy professional systems that are compact in nature...

Not a big fan of most 'prosumer' based gear.

If you like, email me and I'll give you my thoughts.
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Old May 12th, 2006, 09:01 AM   #5
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Hey Dave,

With all due respect; why not post your thoughts here so we could all benefit from your experience as a community?

Tim
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Old May 12th, 2006, 01:49 PM   #6
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its really hard to say what would you spend it on because it all depends what you want to do...

looking at my studio, if i had to start from scratch and got 200,000 i would spend $50,000 on equipment, set aside $50,000-$70,000 for labor, insurance, and other logistics, and spend $100,000 on getting work, that includes taking out ads, taking clients to dinner, sports tickets, bdwy shows, ect ect ...

even the simplest gigs require a camera man, sound guy and producer (or what ever you want to call him, host, interviewer, ect), i like to also have a couple of guys to unload, get food, park the truck... then you need an editor, or two, because you not about to turn down work just do to schedule conflicts and nobody likes to edit after a hard day of shooting, then you have a receptionist, because new clients don't leave messages, and even returning sales emails should be done promptly...

its a tough business but no tougher then running any small business...
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Old May 12th, 2006, 08:07 PM   #7
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Quote:
Originally Posted by Vince Luckey
Hi!

So, I've been reading posts here and researching for about a year now. Making videos has always been my hobbie. I've made some news videos, I've shot weddings, training videos, and even made some short films with my Sony HandyCam Digital-8 and my pirated NLE on my home computer.

So, I finally found someone who believes in me and wants to give me $200,000 to start a business... what should I get? I deffinately want HD, and I'm leaning towards the Canon XLH1, and Adobe Premiere Pro for editing. What does everyone recommend? I want to try to keep it under $100,000 for equipment.

Thanks!
Vince Luckey

hello vince,

i guess the best advice is from @glenn

business plan first

it is depend on your expirience, what you want to do, do you have a clientel, and many other variables.

we have a saying in german:

one bird, does not make a summer


greetings
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Old May 12th, 2006, 09:13 PM   #8
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Wow! So much great advice! Thanks so much!

The trouble is, I don't really know what types of jobs (gigs?) are out there, and how to attract them. Ultimately, I'd like to make movies; doesn't matter if it's 2 hours, or 10 minutes. But with no experience or education (I have a BS in Business Administration, but nothing in film or video), I don't know where to start. I'm also interested in commecials, training videos, or whatever people need. The real problem is, how do I attract that kind of business? How do you find people that have a need for this? I really don't want to end up doing weddings and recitals just to pay the bills.

-Vince
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Old May 12th, 2006, 09:27 PM   #9
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"I don't know where to start"

IMO hire somebody that has experience in the direction you want to go - if commercials then somebody that knows how to get commercials work - and knows the commercial business ... IMO think better then a XLH type camera.

so what does the person that is going to put up 200k get in return ?
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Old May 12th, 2006, 10:22 PM   #10
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I've been working on a business plan for about 8 months, now. I don't mean to come off as having no clue. I do have a pretty good idea of what I want to do. If I want to make decent commercials and other people's indie films, training videos, or promotional videos, I guess I'd really like to know:

1) I know I need lights, mics, booms, etc. What types, brands, and how many would you recommend?

2) What ways are there for generating business other than newspaper ads, yellow pages, word of mouth, and a website?

3) Lastly, assuming that I turn out to be really good at this, is it possible to make a good profit doing this in Northern Virginia (meaning "not LA or NYC")? Or am I too far out of my league?

Oh yeah, and my investor just wants to put his money to good use. If I make it, great, and I can pay him back. If I don't, at least it was fun.

Thanks again for everyone's advice! You guys are really helpful!

-Vince
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Old May 12th, 2006, 10:36 PM   #11
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Quote:
Originally Posted by Don Donatello
"I don't know where to start"

so what does the person that is going to put up 200k get in return ?
I was thinking the same thing. The person that is giving him have all of this money apparently has not done his homework on this by just handing over that kind of money to someone who doesn't have a definite plan. I've got news for you Vince, you can have all of the latest gear but if you don't have the knowledge to use it and even if you do, if you don't have the contacts and/or sales leads, you will fail. But you sound a little too casual about that too. If you fail, oh well, at least it was fun. Something just doesn't seem right about this. There is no bank anywhere that would give you a $10K not to mention $200K loan with no plan in place. I am able to comment on this because I have actually done exactly what you are talking about doing except with only $125,000. It has been very, very difficult to keep things going with tight budgets even on network shows and periods of slow work in my area. I even have several pages of top contacts at production companies in the industry but I can't just use those frivolously. My point in saying that is even though I have contacts or can possibly get contacts easier than others, it has still been very difficult to survive and I think it's only going to get worse as technology becomes more affordable allowing even more people to offer similar services thereby saturating the market. Good luck.

Last edited by James Emory; May 13th, 2006 at 08:54 PM.
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Old May 12th, 2006, 10:58 PM   #12
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I guess he's not really an investor, he's a bored millionaire and a good friend of mine who wants to do something fun, even if we can't get it to work. He's not really out to make money, that's why I'm not taking out any loans or getting a second mortgage on my house. However, Don and James, I think you two have hit the nail on the head. I think my best two options are: 1) Invest in someone who already knows what they're doing, or 2) Even though I enjoy this as a hobbie, and would love to do this professionally, I should stick with something I actually know and find a different business to start. Maybe just buy a nice camera and computer on the side for fun, and see were that takes us.

Thanks for all your help!
Vince
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Old May 12th, 2006, 11:05 PM   #13
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That makes a bit more difference if you know the person like you say. I thought it was just an investor. In either case, with things the way they are in this industry right now, you would probably do just as well if not better to go with him to Vegas and probably come out better, you could actually have fun losing $200K! Hahaha. Well if a possible financial loss truly isn't an issue with your friend then continue with that route. I wouldn't ever get banks involved if I didn't have to. They are absolute bastards to deal with! I hate'm!! Friend or not though, I would definitely get something in writing stating all of the terms and conditions. Money, or the loss of it, tends to alter people's memories sometimes.

Another option would be to invest in productions with established producers with experience and you could be an executive producer. You could learn more about the business while other people lose your money or possibly make you more.
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Old May 12th, 2006, 11:47 PM   #14
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Quote:
Originally Posted by Vince Luckey
I've been working on a business plan for about 8 months, now. I don't mean to come off as having no clue. I do have a pretty good idea of what I want to do. If I want to make decent commercials and other people's indie films, training videos, or promotional videos, I guess I'd really like to know:

1) I know I need lights, mics, booms, etc. What types, brands, and how many would you recommend?

2) What ways are there for generating business other than newspaper ads, yellow pages, word of mouth, and a website?

3) Lastly, assuming that I turn out to be really good at this, is it possible to make a good profit doing this in Northern Virginia (meaning "not LA or NYC")? Or am I too far out of my league?

Oh yeah, and my investor just wants to put his money to good use. If I make it, great, and I can pay him back. If I don't, at least it was fun.

Thanks again for everyone's advice! You guys are really helpful!

-Vince

hello vince,

i videograph for about 5-6 yeras now. about 3 years ago, i started to invest in semi professional stuff. 2 years i was taping like crazy, for free, to get expirience , learn while i go, portfolio etc. now i have some repeat customers which pay, not much, but they pay.
after reading this board, and listen to 2-3 people who have a nice formula what, and how to charge, i decided for 2006 i will charge using their formula. got myself a software so i can built good qotes, and been using this since then.
landed 4 jobs since january, with full pay. got 2 times screwd out of my pay by one non-profit organisation, the other a school district.

my handicap is i do very little editing, and i am a one man team only. most of my customers over the years are fri-sat-sun customers.

if my better half would not support me, i would be dead by now, and could not continue.


ther are a lot of good videographer with expirience out there. why would a customer come to you?

greetings
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Old May 15th, 2006, 06:55 AM   #15
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Tim,

You are right, I will post further later today.
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