It’s a tough time for the Arts these days. The era when funding was plentiful is long gone and, today, the harsh reality of running theatre companies like the businesses they are is being forced on arts managers.

It’s a tough time for the Arts these days. The era of plentiful funding is long gone and, today, the harsh reality of running theatre companies like the businesses they are is being forced on arts managers. Paul Couch looks at how creativity and commerciality can be productive partners.


One of the first things to think about is whether your company will be profit or not-for-profit. Will you pay your actors and technical staff a fixed fee or profit-share? In the old days, repertory theatres thrived across the UK. There would be an actor/manager – usually the founder of the company – who would employ a group of performers and technical staff on a contract basis – usually a period of a year - at the end of which, those contracts would be re-negotiated. It would be possible in such circumstances for the same people to be working with the same company for a number of years, much as would be the case with a non-arts business.

These days, with the exception of senior management teams, people in the arts are far more likely to
Tips from an expert...
Mark Smith (pictured)  is artistic director of Spike Theatre, a company he co-founded 15 years ago. He says: “The climate for touring [productions] has altered massively in the past 15 years and none more so than now; the current financial climate has had a massive impact on theatre, although support for new companies has never be so healthy.”

Smith offers the following tips for anyone thinking of setting up a professional performing arts company:

  • Go and speak to a company who have been around for a while (most companies are happy to talk); chances are they did the same.
  • Start small and grow in a considered way – a business plan, although boring, gives you a focus and an ambition, it also helps you open up a business account.
  • Work out who is responsible for what (book keeping, tour booking, website, etc) and identify any training you might need (the Independent Theatre Council has some great courses)
  • Be honest with each other about opportunities outside of the company (we all have to make a living) as these can open up opportunities for the company
  • Develop relationships with people and venues (go to networking events formal and informal), invite people to see your work and go and see theirs
  • Don’t be scared to ask for things – people can only say no (although be realistic, no-one is going to commission you)
  • Be nice to people, say thank you; manners go a long way
  • Remember if it is not fun, stop doing it.

be employed on a freelance basis, moving from company to company as work dictates. While this does not offer the stability of repertory work, it does provide both creative challenges for the employee and a moveable feast of staff costs for the employer.

Don’t forget that you will also need to create a limited company. It is also advisable to apply for charitable status.

Mission statement

For any company that will potentially depend on funding from external agencies, a mission statement is essential and should be one of the first things addressed.
  • What is your company’s aim?
  • Who will your audience be?
  • How do you intend to impact positively on the wider community?
While this mission statement is an important part of your governance, it will also be a cornerstone of your marketing and outreach strategies.


In the UK, funding for the arts has seen a swathe of crippling cuts in recent years. Many companies have folded, while others are producing fewer and fewer productions with smaller casts and much tighter technical budgets.

Arts Council England (ACE) is the first port of call for arts companies seeking funding; however, due a cut of 29.6 percent in its grant-in-aid from Central Government in 2011, there are now limited resources available and any arts companies seeking cash will need to put forward a compelling case.

Private sector sponsorship is also a possibility, either from individual companies or groups. However, especially if you intend to pursue this route, a viable business plan is a must. Check their websites to see if they have a Corporate Social Responsibility (CSR) policy and ensure that any unsolicited application is as professional as possible.

Other methods of funding are:
  • Co-production with established theatre companies
  • Trusts and foundations – many are looking for artistic merit and potential rather than charitable status
  • Individual giving – patrons are often willing to donate anything from a small amount each month to many thousands of pounds a year. It all depends on how you market yourself and how you’re satisfying your audience’s needs.

Bank account

Your company will need its own business bank account from day one. Most banks have a competitive early years business account to offer new businesses. Don't be afraid to shop around and ask for deals that might not readily be apparent.


The governance of your company is also one of the first things that you need to address. In an ideal world, you will need an Artistic Director, who will determine what the company produces, and an Executive Director (or Producer), who will guide how work is produced. This person will need a good eye for finance and the commercial aspects of the business. In smaller companies, they might also be responsible for the building of external relationships, fundraising, audience development, and the day-to-day management.

Before you embark, it is best to have a written plan of who is responsible for what, including detailed job descriptions.

If your company intends to include children or vulnerable adults in its work (as participants rather than audience), any employees who will come into contact with these groups will be required to undergo Criminal Records Bureau (CRB) checks.

Brand extension

Running an arts company isn’t just about putting on plays. You will need to develop supplementary revenue streams such as stagecraft training, confidence-building, role-play work for corporations, and even events management.


Within the arts, the marketing function is notoriously considered the “poor relation”. There are many worthy theatrical productions that have fallen by the wayside for want of a viable marketing strategy.

The truth is that marketing should often comprise up to a third of your overall budget. These days the reality for performing arts is that free social media is coming into its own as a potent marketing tool. It’s also imperative to develop good relationships with regional and national print, online, and broadcast media.

Early on, create a database of your audiences (don’t forget the stringent rules of the Data Protection Act 1998) and maintain it rigorously. Someone – probably your Executive Director – will have to be registered as Data Controller.