An Update on The Billfold LLC
I wanted to give you an update on The Billfold LLC, which has been in the works for a few months and came into official existence in March.
First, let’s do a breakdown of what it cost us to form the LLC:
$266.10: LegalZoom LLC filing package (we went with LegalZoom because it was quicker/easier/less expensive than working with a CPA/attorney, and our simple partnership LLC didn’t have any special needs that LegalZoom couldn’t handle)
$50: LLC state filing fee (we filed in Iowa)
$79: EIN obtainment fee (I could have obtained our EIN instead of paying LegalZoom to get it for us, but my time is also valuable)
$74.99: Business license research fee (I could have also done the work to research and summarize all of the steps required to get our business licenses, but… see above)
$159: Registered agent annual fee (LLCs need registered agents who are available to receive legal paperwork on the LLC’s behalf)
$9.95: LLC paperwork shipping fee
$164: UPS mailbox/official mailing address for The Billfold LLC (when you form a company, it’s best to give it a business address that is not any of the members’ home addresses, because people can move/resign membership/etc. and also because LLCs are all about separating personal and business)
TOTAL LLC COST: $803.04
If you’re thinking of creating your own LLC, you might be able to knock a couple hundred off the top by doing the EIN and business license research on your own, and you could weigh the pros and cons of being your own registered agent (con: never being able to go on vacation, since most states require you to have a business representative available to receive documents at all times). If you have formed an LLC already, I’d be curious to hear about your experience and whether its costs were comparative to ours.
Now that I’ve covered what it cost to form The Billfold LLC, let’s look at what our LLC is earning.
Part of the reason I didn’t sign up for the job of “figuring out what business licenses we need” is because I was already busy with the job of getting us sponsorships. I was a little surprised to discover that I was pretty good at this job, until I realized that I’d spent the past six years pitching and landing clients for my own freelance work — and reaching out to potential sponsors takes many of the same skills.
Currently, The Billfold’s income comes from Patreon, sponsorships, and ads. When you combine our current Patreon and ad income with both our current and future planned sponsorships, we have enough money to fund The Billfold at the MEDIUM BILLS level (i.e. what we’re doing now, which costs just under $4,000 each month) through the end of June — by which point we should have additional sponsorships scheduled to help fund MEDIUM BILLS programming for the next few months, etc. etc. etc. (This is assuming the Patreon money stays constant, of course — and once again, thank you for your support. ❤︎)
You might ask — and I am currently asking — whether we should use the sponsor money to run more content on The Billfold RIGHT NOW, instead of budgeting it out over the next several months. I have decided to hold off on increasing the number of features we run until I learn whether The Billfold can sustain this level of sponsorship over time. I should have a better sense of this in the next two months, and am currently hoping that we can run MEDIUM BILLS programming through the summer while stocking up money to fund LARGE BILLS (two guest features per day plus all the stuff I write, which’ll cost $6,000 per month) in the fall.
Because you don’t want to switch over to LARGE BILLS without knowing you can sustain it. Doing LARGE BILLS for a month and then having to tell y’all we need to switch back to MEDIUM BILLS (or, even worse, SMALL BILLS) would be demoralizing — and it would look like we hadn’t budgeted appropriately.
So. My near-term goal for The Billfold is to get us a sustainable income that will fund LARGE BILLS programming starting this fall. My longer-term goals include starting a podcast (which I’m still hoping will happen this year), increasing the money we pay our writers (which I’m hoping we’ll be able to do in January 2019), and figuring out what to do about our ads. I keep thinking “well, if we could cover our budget at the level we want to produce with just Patreon and sponsors, then we could go ad-free,” but it’ll take a few more months to figure out whether that’s realistic.
I should also mention how much I’m getting paid, because I want to put that number into context: I’m earning ~$1,700 each month (the number, like our income sources, is variable) for 20–25 hours of work per week (writing, editing, scheduling, fundraising, administrating). At this point I’m responsible for pretty much everything required to keep The Billfold running, so I guess it makes sense that my budget line item takes up a little under half the budget.
I hope that update is helpful! If you have additional questions, please ask ’em in the comments.
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