Posted on November 28, 2014 @ 04:43:00 AM by Paul Meagher
In my music industry explorations this week I came accross an interesting recent article called Pomplamoose 2014 Tour Profits (or Lack Thereof). In this article, they analyze their income and expenses for a month long tour. They created their
income categories and expense categories and modelled the income and costs associated with each category. This modelling became the basis of their tour budget (and what they measured afterwards):
We built the tour budget ourselves and modeled projected revenue against expenses. Neither of us had experience with financial modeling, so we just did the best we could.
In the end, they reported a $12,000 loss on the tour. Part of this was because they paid the band well, stayed in decent hotels, and incurred many expenses that some bands would argue they would not have incurred. The Pamplamouse duo make revenues through other online channels that generates decent monthly revenue for the company so this may be a case of taking money out of one revenue producing stream to try to get another revenue stream launched better and to grow their existing ones. Whatever the case, I think they have provided some useful insight into what it takes to budget for a tour and the fact that they developed a financial model before jumping into it is noteworthy. It provides a useful template for entrepreneurs who might be unsure as to how to develop a financial model for a project or business cycle.
You can visit the Pamplamouse website to learn more about them and track the feedback and blowback they are getting for publicly reporting their tour financials.
You can listen to some Pamplamouse music at their Soundcloud page.
I liked their "The Internet is Awesome" track which is shared below.