Whenever a client comes to me and tells me that their goal is to make a ton of money off of an event, I get a little wary.
Here's the truth: hosting a live event is not a get-rich-quick scheme. You will spend a lot of time planning and probably a bit of money executing a well-done event. And if you're not planning on hosting a well-done event and you just want a so-so experience, I'm going to ask you why you're bothering in the first place.
That said, events are good for building your brand. Building your platform. Having experience as a speaker if you want to get started speaking. Booking clients after they see you one-on-one.
They're a marketing tool that can elevate you quicker than a drip-campaign-webinar-series-blogging-SEO-toolkit-freebie-optin can.
So when you're thinking about whether or not your event will be profitable and how much profit you should make, the answer is...
Your profit should be your speaking fee.
If you speak and you get $0 whenever you speak, then you should aim to break even at the end of your event.
Let me say that again.
your event's profit needs to be your speaking fee.
You're saying "Lauren! What the heck does that even mean?"
It basically means that if you were not speaking at this event, you would likely be paying someone else to do so.
It also means if you were not planning this event yourself, you would be hiring someone else to do so.
Thus, you need to consider your hours for both organizing and speaking as line-items on your budget.
Capiche? Okay, moving on.
Let's start with some Inside industry knowledge.
In the event world, most companies aren't seeking to make a huge profit on an event (heard of the Olympics? Classic case of an event that is brand-building but often money-bleeding).
Events are naturally time AND labor intensive, and for a company to make their millions planning and putting on their own events...well, they'd be better off putting that energy into selling more of their own products or services.
That's not a knock to my profession - as an event planner for others and someone who plans her own events, I truly understand how valuable being in a room with a workshop leader or a "guru." But again, the amount of time and money it takes to throw an event can be discouraging. You've got to want it for a different reason.
Namely, speaking experience, community building, love of being in the same room with your peeps, getting your name out there to new peeps, etc.
The Money Breakdown
For an event, you'll at least need:
2. A speaker
3. Ways to market the event (could be all organic, done by you)
4. Someone to do all the planning (could be you)
5. Food/beverage (if you want to be really nice)
You should assign each of these things a value. If you're not valuing the time you're spending planning the event, then you don't have an accurate picture of how much the event is actually costing you.
For example, my #BossLadyBash took me about 50 hours the first time around to plan. The second time around, about half that. My #CEOSessions take about a third of that time, since it's a similar formula. But still, that first one didn't make me any money after I had figured my time into the calculations.
Which is an awesome model to run. But it shouldn't be the model that you're running every single time.
So, when you're doing your event budget, I want you to add a line that says "Speaking Fee" at the bottom. And right above that, I want you to add a line that says "Event Planner." This planner could be you, or it could be someone else. But be sure you're factoring in the amount of time planning this event is taking you, since that is time you could be spending elsewhere in your business.
At the end of your event, any profit you made should be equivalent to your speaking fee.
Let's run a model for a really inexpensive event for 40 people, okay?
Venue - $500
Marketing - $500 (design fees, printed stuff, etc.)
Food + Beverage - $600
Planning - $750 (50 hours x $15/per hour at least the first time around)
Speaker (you, badassbizowner) - $250
Your total cost here is $2,600.
Which means you need to charge at least $65 per person to cover all your expenses, your time, and your speaking fees.
If you're sitting there saying "Oh, but Lauren, I much prefer to just set a per person budget and then figure it out from there."
Which is nice, in theory. But it doesn't work all that well if you don't have a basic idea of how long this event is going to take for you to plan.
Which is why I strongly advocate for you to plan out a tentative budget FIRST and THEN see how much money it's going to cost you to put the event on. You may realize that it's not worth it for you to do the event. Which means you save a ton of money and a ton of time.
Does this all make sense? If you're still struggling with how to set a budget for your event, go ahead and let me know in the comments below. I'll answer any questions you have around event budgeting!