Considerations Before Starting A Video Production Company

If creating videos is your passion, at a certain point you’re likely going to consider starting a video production company. There are a lot of considerations that have to go into this decision.

Considerations Before Starting A Video Production Company

If creating videos is your passion, at a certain point you’re likely going to consider starting a video production company. There are a lot of considerations that have to go into this decision.

Working for yourself is a huge undertaking, and requires proper forethought and planning. Considering most startups fail within their first couple of years, you need to make sure that you’re ready for the challenges. This post aims to help you get started, but it should not be taken as business advice.

The Idea

Once you set about the idea of starting a video production company – you first need to consider WHY. There are thousands of video production companies in the world, what do you have to offer that they don’t? What will be your niche? What do you want your company to look like? This stage is the initial planning where you take your raw thought and start to build it out. Once you have several ideas in mind you can start going into deeper research.

The Research

With all businesses, doing detailed research into the industry and market is a crucial step. Who are your competitors? What are they doing? What are your strengths? Your weaknesses? Look into industry websites, magazines, and podcasts. Anything that will help you learn more about the ins and outs of video production. You also want to look into what your potential customers and learn what they are currently doing with video. Are there opportunities to work with other individuals that may have complementary skills? Research every aspect of the industry!

You should also speak with industry experts for their insight. As long as you’re not going to be in direct competition with them, most people are willing to share their knowledge. After that, you need to speak to legal counsel, accountants, bankers, and even your friends and family. The more research and information you have, the more informed your decisions will be.

The Plan

Every successful business needs to develop a business plan. A business plan acts as the blueprint for your video production company and guides your path forward. Business plans are detailed documents that cover everything about your business. Topics covered in a business plan include:

  • The Executive Summary. A summary of your business, usually no longer than two pages. It covers all the relevant information that someone might need to know.
  • SWOT Analysis. A detailed look at the Strengths, Weaknesses, Opportunities and Threats to your production company. This section can also include the path forward, as well as future plans.
  • Market Insight. A very detailed analysis of the current market for your video production company. Market needs, trends, growth potential, customer profiles, competition, market segmentation and more.
  • Marketing and Sales. Even more detailed documentation into the operation of your video production company. Marketing and sales plans should be outlined. Necessary equipment, technology and other important details that lead you to be profitable.
  • Management. Here, you’ll discuss everything from the business structure (sole proprietor, partnership, corporation). You should also outline important people and potential hiring.
  • Financial. Finally, your business plan should detail all the financial aspects of your operation. This includes your sales and revenue forecasts, as well as your expenses. It should project realistic profit (or losses), and establish your cash flow.


Once you have your business plan, this is where you can take it to potential investors in the company. There are generally seven different ways to get money for a startup.

  1. Your Own Money. Most small businesses start with your own financial investment. This can either be in the form of cash, or through collateral on your assets. You will likely need to do this first because it shows other financial sources that you are committed to the project.
  2. Friends and Family. When you get money from friends and family, it’s usually done with the understanding that you will pay them back as your company makes money. Investors call this “patient capital”. It’s important to remember that investment from family can come with risks related to being friends and family.
  3. Venture Capital. Venture capitalists generally invest in businesses that will have a high degree of growth potential. This means they expect to see the company expand quickly and be a leader in new technology. As such, it may not be a direct fit for a video production company, unless you’re leading something new such as VR or AR.
  4. Angel Investors. An angel is someone who often has significant cash and wants to invest in early-stage businesses. In exchange for a cash infusion, most angels demand supervision over the business through a seat on the board. Most angels are not publicly known, so you will need someone to introduce you to one.
  5. Incubators. An incubator is a type of business ‘accelerator’ that connects promising businesses. This includes administrative, technical and financial people that may be able to help a business grow to the next level. Incubation periods are generally less than 3 years.
  6. Government Grants. Some countries have business grants supported by the government. These grants come in a variety of formats ranging from 'free' money to million dollar low-interest loans. Government grants are very specific in the projects they support, as they intend to grow an industry in specific areas of the country.
  7. Bank or Other Financial Institution Loans. The final method of accessing financing for your video production company is through a loan. Most banks have business experts that will look over your business plan and offer you loan terms if they feel it is a worthwhile risk. Keep in mind, loans need to be repaid with interest.

Starting Up and Continuing

Once you have the idea, the business plan, and the financing, your next step is starting up! This is where all your research and planning come to action. You want to establish all the business elements as soon as possible so that you can start acquiring and working for your clients.

As your company grows, you want to be thinking about the future. Any business should constantly be looking at ‘what’s next’. This includes hiring staff, expanding operations and growing the business in new directions you didn’t envision. Then, one day you may be talking about selling your company! But it all starts today - with an idea and a dream! Good luck!