The band investment question

[spacerust]

My friend and I have been playimg together for a while now. Between us we have all the equipment. Now we just started a new band and things are going quickly. We are getting quite a few gigs to where I think we will have to start getting bigger stuff. The new members agreed that what we make will go into better band equipment. The question is one of the guys may be leaving in about six months. I say that the equipment stays with the band, my friend says it isnt fair to the guy leaving and that we should buy him out. I say that if we all split up yes it should be sold and divided but if someone leaves the equipment should stay. Then he mentioned that when we get paid each time just to give him his part but I dont thi nk we should continue to invest individually. We want to do things right. What is the normal band thing to do. I own the whole pa system, monitors, most of the mics and eventually want to sell some off to get me something I personally can use...any thoughts?

[MNAirHead]

This is a hot potato

My opinion is to never have band gear or accounts - compensate someone

[aaronhutson]

I agree with MNAirHead. The only reason there should be a band account is to pay for merch. And when my bands do that, we just pull a certain set percentage out of the nights earnings until we have the amount needed to make the merch order. Then everything from there is profit and split up just like the nightly earnings. I own all my equipment and the guys I play with buy thiers. If your stuff sucks, we'll let you know. Not being mean. But generally a line 6 half stack cant keep up with a full bass stack and another full guitar stack. At least not without mics.

But anyways, I would never have a band account to buy band equipment. Everyone buy thier own and save the band the arguments.

[mellowinman]

Originally Posted by aaronhutson

I agree with MNAirHead. The only reason there should be a band account is to pay for merch. And when my bands do that, we just pull a certain set percentage out of the nights earnings until we have the amount needed to make the merch order. Then everything from there is profit and split up just like the nightly earnings. I own all my equipment and the guys I play with buy thiers. If your stuff sucks, we'll let you know. Not being mean. But generally a line 6 half stack cant keep up with a full bass stack and another full guitar stack. At least not without mics.

But anyways, I would never have a band account to buy band equipment. Everyone buy thier own and save the band the arguments.

Then who is responsible for the PA?

[jungleheat]

If he's contributing to the band, he should get some kind of cut. If you all broke up, you would sell the stuff and split the money, right? Why should it be any different if only one person leaves? Except instead of selling the stuff, when you get a replacement, he "buys in" and the other guy is bought out with that money, minus depreciation for the time he was in the band (or looking at it in reverse, equity).

But it's pretty dumb to put ALL the money into gear. If you're making enough as a band to bother getting gear with, then you're making enough for each guy to get his own cut each night (say $50 at least). What kind of shows are you doing that you need so much gear anyway? My philosophy is the amount and quality of gear I'm willing to bring is directly proportional to the size/quality of the gig, and should never be "over" that. If you're spending ALL the band's money on gear, you're doing something wrong.

If nothing else, do something like:

Take total band payment from gig.
Subtract $20 for each person for gas, etc... (people should at least not be LOSING money playing shows if at all possible).
After that you could say 25% goes to band gear (ie PA and stuff, not buying instruments for people).
25% just goes into a general band fund (flyers, merch, recording costs, rehearsal space, etc...)
And then the other 50% gets divided evenly among the band members.

At some point, you really shouldn't need any more gear (besides occasional replacements and cables and accessories), and that percentage can be added to the 50% (and then maybe to the general band fund as well).

of course, it's easiest just to divide it all up evenly at the end of the night.

It would help if you said what kind of band it is, what kinds of gigs you play, what kind of gear you have now, and what you think you need.

[Stumbo]

Who decides on what gear to buy and how much to spend on each piece?

Just curious, what equipment do you have now and which pieces need replacing?

If someone invests in a business, they need to get a return on their investment and either keep the asset or have someone buy them out. Happens all the time in millions of other businesses. Why is "being in a band" a special type of business where this can't happen?

If you know someone is leaving in 6 months and you want them to keep giving you money that won't be returned, what logic is that based on? Why would they do that. Bands break up every minute.

Seems like you invested quite a bit of money in equipment that is no longer useful and you don't want to pay for more "band" equipment so you're out to gouge money out of your band mates to upgrade your equipment. By the way, who gets the equipment if the band breaks up? If you buy separate pieces, everyone walks away with what they bought. No arguments or bad feelings.

Overall, that's not the way to lead a band. Why would someone join a dictatorship band where your money get confiscated?

Here are a few links to study that may help you out:

If I only knew then...

~Band management
Intro
Books
Book - "Bandalism"

How to handle a big band
Playing in a band w/o rehearsing
If your significant other is a non-musician
Democracy/dictatorship?
"Leading" a band
Band "funds"?
Why many bands fail

More links below that you should check out.

[phatbass]

Unless the band is gigging hellaciously and making enough money to make it worthwhile becoming an actual business entity, PA stuff should be bought by individuals - either everyone owns a piece (e.g. singer owns the desk and mics, guitarist owns the speakers, Bassist owns the power amps) and takes it with him/her if/when they quit, or one guy buys the PA and the band pays him a normal hire cost. And if you're doing bigger shows, hire.

After over 30 years in what I laughingly call the business, I've NEVER seen the communal ownership/band fund thing end happily. I'm sure it does occasionally; just I've never seen it.

Usually either some guy ends up with a PA he paid peanuts for, or everyone is complaining that the PA is worth more than it actually is.

By all means pool earnings for short term things (studio time, etc.).

[MNAirHead]

Originally Posted by mellowinman

Then who is responsible for the PA?

Whomever owns it or agrees tocontract rent it

[spacerust]

Ok, I didnt want this to be a problem. I thought about it and I bought most of the stuff because I wanted to make we were setting it right. I see your logic. I think we will just split the pay and if anyone wants to "upgrade" !somethimg they can. This is what I own that the band uses. I used to play guitar but in this band I play bass. I have a peavey 512sc pa power amp, 2 peavey 15 mains, 2 peavey 12 monitors, 4 50' neutik cables, 2 shure sm 58 mics, 1 shure 55sh mic, gibson sg standard, fender blues jr, 3 boom mic stands plus my bass stuff. My friend own the drums and the rest of the mics. I guess I wzs just thinkimg that with wear and tear im out the equipment. But honestly the guys I am playing with are really cool and thats why I postes here first before I mentioned it. We have fun so I think we will continue that and not worry about the equipment. Lol...besides I always buy stuff all the time so its gonna be about having fun. Thanks and I probably just needed to express some thoughts. We have played christian events for about two years but never really charged for any events but we did a oldies show for fun and it quickly becoming quite a fewpaying gigs where we can make a little money. We even got imvited to play om an oldies radio show so God is good. Once again thanks for some insight.

[nautipaul]

Here's what works for us. I own all the PA. I do most of the booking and promotion of the band. We have 6 members. We split the money 7 ways. I get 2 shares. No problems.

[MNAirHead]

Overall... seems as if the following seems to be the easiest equation.

15% for the booking guy
10% for the PA
The rest is then split between the band

[hrodbert696]

If you think of this legally, as far as the law is concerned, a person is a legally responsible entity - which means being able to own stuff. A band is not UNLESS it legally incorporates. If the band does not incorporate, then the band cannot own anything - the individuals do. Frankly, I think the law makes a lot of sense here - a lot of bands implode because they have members contribute money to buy gear but don't define who actually owns it. If the individual contributed 1/4 of the money for the PA, then he owns 1/4 of the PA and nobody can use his property without his permission. You either have to rent or borrow his property on terms he agrees to, or else buy it from him.

Settle this NOW before anyone spends any (more) money.

[MNAirHead]

Iv'e been through many versions of band gear... either renting or one person owning/managing it makes the most sense.

[hrodbert696]

Originally Posted by nautipaul

Here's what works for us. I own all the PA. I do most of the booking and promotion of the band. We have 6 members. We split the money 7 ways. I get 2 shares. No problems.

Simple and sweet, and I thoroughly approve of this arrangement. This works as long as there IS one individual in the band who can afford to buy the whole PA on their own dime. It gets complicated when there is no such person in the band.

[Phalex]

I own several power amps, the mixer, and a rack case full of EQ, Effects etc....... These are mine, and not the bands. I will either take them all with me if and when I leave, or give them the option to buy at a price that is either very reasonable, or slightly above retail. (It kinda depends on how things shake out in the end.)

[Muttleybass]

IME, band accounts and sharing equipment never work. Inevitabley somebody is always replaced at some point. The only shared expence should be promo (pics, merch, posters) and rentals. Even then it should be agreed that if someone walks away, they walk away with nothing.

At the moment, I own all the PA, so it's never an issue. In the past, I have had various pieces of equipment. Once, the singer had a PA board, I had monitors, the drummer had some lights...

My advice is buy a piece of gear the band needs, have someone buy another piece, mark your gear... and cords! I've seen fisticuffs over cords, even. Then if someone walks away they take their gear... unless they want to sell it to you.

Problems always arise when someone has to be bought out, but the rest of the band doesn't have the money. Then there's arguments over depreciation... Never good. Never fair.

[Stumbo]

Originally Posted by hrodbert696

If the band does not incorporate, then the band cannot own anything...

Not true.

Partnerships own stuff all the time. In CA, file a DBA (so and so partnership doing business as XYZ band). Put your partnership agreement in writing(including dissolution process) for the best long term results. Then put all the money in one account and buy stuff. There's nothing sacred about incorporating as far as ownership is concerned. If someone leaves the band for whatever reason, a new partnership begins.

Former accountant here. Maybe a lawyer will chime in.

[hrodbert696]

Originally Posted by Stumbo

Not true.

Partnerships own stuff all the time. In CA, file a DBA (so and so partnership doing business as XYZ band). Put your partnership agreement in writing(including dissolution process) for the best long term results. Then put all the money in one account and buy stuff. There's nothing sacred about incorporating as far as ownership is concerned. If someone leaves the band for whatever reason, a new partnership begins.

Former accountant here. Maybe a lawyer will chime in.

I stand corrected; but am I correct that the broader point stands that you need to have a legal persona of some kind to actually have ownership?

[TRichardsbass]

I agree with others here, just get an additional share from each cut to pay for the wear and tear on each gig. Its your PA and you should get some compensation so you can pay for new gear when you need it or you can get yourself something else.

Its fair. You guys would pay much bigger bucks per gig to rent what you have. if the people in the band can't handle that, then they shouldn't be in a band.

Using your older gear is better anyway, as you couldn't sell it for what you paid for it, and the money you get over time from an extra share will more then have paid for it. And don't feel bad. You invested in it for this. The others shouldn't care.

tom

[oniman7]

I'm going to speak out a little differently from everybody else here.

My band is a team and an investment. We all invest hours and lots of money (lots to us, anyways) in the band because we want it to succeed. After every show, we split the money up 5 ways. The first couple shows, we all took it home. After that, I've asked people to start volunteering their share towards a band fund. This is strictly a donation to try to help the band succeed, and it's understood they may or may not see that money back. If they want to take it home, that's cool too, but it shows who's really serious about the hobby. Occasionally some of the members have taken their share to save up for some better gear (one guitarist's Peavey 212 Combo is really dragging in the gear end of things). The singer has a 2 hour round trip to our practice space and burns about $15 in gas coming to practice with us. Therefore, when money's tight for him, we give him his share, and maybe even a little extra if everybody's feeling generous. We put the money towards things like merch and studio time. All money from merch goes back into the band account.


The reason we can do this is that we're all in high school and living in stable housing with steady income and don't have to worry about rent or bills. The singer is 20 and has a couple jobs, but lives at home to save some money, so his situation's a little different. But while we have time, we want to put our all into the band to see it succeed. Of course our goal is to be famous and rich and play to packed stadiums. But more realistically, we're going to very soon be able to do things like small regional tours and recording an album (we just recorded our first two songs the other day). The only way this happens is if we all contribute. We even make small donations of a couple quarters or a few leftover bucks from lunch because we all have a huge desire to see it exceed. We put the money we make back in because there's so much to spend money on. Merch, Wireless systems, in ear monitors, decent PA Support, drum mics, gas, recording, lighting, all sorts of things. And then once we get through all of that, we can start putting some money aside for things like personal gear (guitars, amps, drum heads, strings, etc.)

In the event of a breakup, we've decided that we'll disperse the gear reasonably among whoever wants it or sell it off and take an even share of the money.

EDIT: I also have a great trust relationship with my mates. Might not be for everyone, but certainly a different perspective.