Starting a Theatre Company
Starting a theatre company can be a great way to take charge of your career and start creating work yourself instead of waiting for the perfect job or opportunity to come around. However, it is a big decision and comes with a host of responsibilities.
Do Your Research
There are a variety of different kinds of companies that you can start: limited by guarantee, limited by shares, community interest company (CIC), partnerships, social enterprise, co-operative, charity, and charitable incorporated organization (CIO). The first step is deciding what the aims of your company will be from a business sense. Do you want to make a profit? Your best bet is a company limited by shares. Do you want to use the profit purely for the company? Maybe consider a company limited by guarantee. Are you completely uninterested in profit and want to open yourself up to donations or charitable work? Start looking at a charity, CIC, or COI. The best place to start your research is here. The government has a lot of helpful guides on starting businesses.
If you are one or two people that want to work together regularly, you might want to remain as self-employed individuals and come up with a more informal agreement between the two of you. At the beginning of your career you will not be making much money, so forming an official company might be more hassle than it's worth.
The most important thing is to understand your financial requirements with any charity or business you set up. I know someone that created a company right out of drama school, used it for a year to produce one play, and then didn't use it for the following year. He suddenly started getting letters from HMRC while on vacation saying he owed thousands of pounds. It was a lot of headache and stress for him to prove to HMRC that he didn't make any money through the company. At the end of the day, he wished he had not started the company for one project.
Remember that things like business accounts, business PayPal, VAT, and so many other fees apply to businesses. You have to spend money to make money. Be sure you have enough seed money to start a company before you make the leap.
The biggest benefit to starting a theatre company or charitable organization is that it opens you up to a vast array of funding options. Many opportunities and funding bodies only fund official companies or charities. Below is a list of companies that offer various kinds of funding and development opportunities for companies.
Edinburgh Fringe specific:
I cover this a little bit in my post about collaborators in self-producing, but the people that you start a company with are incredibly important. People say there is a hard and fast rule about whether or not to work with your friends, but I don't find that to be true. You need to be able to take a step back from emotional attachments and determine whether you and the people you start a company with can work together, can manage money together, make and execute long-term goals together, and can communicate clearly with one another. Those are more important than whether or not you are friends.
*Important note* If one of the people you want to start the company with is on a Tier 4 Student Visa, they cannot be registered as a director or secretary or any other official position in the company. People on this visa cannot start or run a company. If their school finds out, they will be reported to the Home Office and could have their visa taken away.