How to Start a Comedy Club

Part 1 - How to start a Comedy Club business - Background

A comedy club is a venue where different performers perform a variety of amusing routines for customers. These routines may be varied and different, but they are typically stand-up or improv routines. A good comedy club is like a few businesses rolled into one. In addition to providing live comedy, you should also serve food and alcohol; this encourages customers to spend more time in your club. In fact, there is often little difference between the atmosphere of a comedy club and a nightclub.

Our guide is in 3 parts:

• Part 1 - How to start a Comedy Club business - Background
• Part 2 - Our planner tool to see if this idea is the right fit for you
• Part 3 - Action plan to get started

What are the costs involved in opening a comedy club?

Depending on the size of the space you lease and its exact location, start-up costs can be around $100,000. This includes about $30,000 for kitchen and bar equipment (including starting stock), $50,000 to build a new structure to your specifications, $25,000 to purchase land, and $5,000 to obtain relevant licensing. In competitive metropolitan areas, the amounts for everything (primarily construction and land) can be much higher. One way to reduce some of these starting costs is to lease an appropriate space rather than build a new one. You may still need to renovate (sometimes extensively) the inside, but this can cut these opening costs in half and sometimes make them even lower than that.

What are the ongoing expenses for a comedy club?

One of the largest ongoing expenses are the acts themselves; while the individual talent will have varying charges, some estimates are that you may spend 40 percent of your expenses on booking acts. Another 20 percent goes to keeping your food and beverages well-stocked, while 15 percent is a good estimate for the salaries of your staff. Ten percent of your expenses will likely go towards rent and licensing requirements, whereas the final five percent is likely to go towards various office expenses. Thus, while your exact expenses may vary, you can imagine a successful night in a venue with 300 seats bringing in about $7,500 in cover charges alone. However, it’s more realistic to expect this to yield between $750 to $1,125 in actual profit for you.

Who is the target market?

While a comedy club will have all types of customers, your preferred clients will typically be young couples. This group is likelier to make your club a regular staple of their date nights together, and younger couples tend to go out most often. These couples are also likelier to take advantage of the meals and drinks you serve, meaning that they will help generate profit for you on three fronts.

How does a comedy club make money?

The comedy club business model is pretty simple: you charge clients an upfront amount to get into the club. Clients will typically pay extra for food and drink unless you are selling some kind of package deal. Similar to nightclubs, you may consider charging clients who are under the age of twenty-one additional money to offset the fact that they won’t be purchasing any alcoholic beverages.

How much can you charge customers?

How much you charge clients is intended to vary based on which comedian(s) you have booked for that night. For instance, you might be charging $15-$20 to see a local comedian that is just getting started in his or her career. If you have a major name coming in (such as Jerry Seinfield or Louis C.K.), prices may be closer to $100 and will largely be dictated by the famous comedians themselves. Keep in mind that the talent will be getting a large chunk of each ticket sold: this is why, like a movie theater, it’s really important for you to make a profit off of food and drink.

How much profit can a comedy club make?

As the estimates above indicate, your profit is largely dependent on how many nights you operate and how many of those nights you can fill the club to capacity (or close to it). Even on the low end, if you were to operate your club only four nights a week and make an average of $750 in profit a night, you could pull in $12,000 a month after your other expenses are paid. Ultimately, your first year or years may not be quite this profitable right away, but once you have established yourself with your community and with the community of comedians, the profit margin on a comedy club will be enough to make you smile each year!

How can you make your business more profitable?

To make your club more profitable, add things like “local nights” where amateur comedians can practice their craft: this builds up local enthusiasm and boosts your community. Depending on your area, you can have discount college nights in which someone’s college ID lets them in for a reduced charge, which helps spread word-of-mouth about your club. As mentioned earlier, you can experiment with doing lunch at the club even acts aren’t performing, which allows the restaurant portion of your business to become more profitable. Finally, make sure you have fully embraced online marketing: most comedians now have some of their sets online in various forms of media, so you can create a pleasant synergy between comedians and club by marketing their material, linking to their CDs, web pages, and so on. If done right, this increases profits for everyone!

Day-to-Day and Growth

What happens during a typical day at a comedy club?

Because a comedy club is like several jobs rolled into one, any given day may have many different activities. This can include receiving food and drink supplies, stocking them, and cleaning the respective eating and drinking areas such as dining tables and the bar. Part of your days will be spent communicating with comedians and making sure that you have a well-coordinated schedule for the evening. You will also often be advertising your business via traditional methods like fliers and via social media. You will also be in charge of coordinating your employees.

What are some skills and experiences that will help you build a successful comedy club?

Previous experience working at a comedy club can be invaluable in helping you get this business started. It’s even more advantageous if you have worked as a comedian, as you will know what the performers expect in terms of payment and service. Your prior experience may also help with initial networking which will allow you to book the first weeks or even first months without having to rely on complete strangers to perform.

What is the growth potential for a comedy club?

Such a business has modest growth potential. One industry report claimed that comedy clubs as a business are projected to grow nearly two percent through the year 2020. There is also sideline business potential to run the place as a restaurant in the daytime and full club at night, or even as a bar on nights where no comedians are scheduled to perform.

What are some insider tips for jump starting a comedy club?

Make sure you hit the ground running with a dynamic logo, slogan, and slick advertising. As with most business ventures, it’s important to establish your brand within the community as quickly as possible. Make sure to choose the best location possible—a location that has a lot of parking and is easy to drive to when people are heading home from work or out shopping will help lure in impulsive customers. Finally, be patient—as with ventures such as bars, restaurants, and nightclubs, it may take a while for this business to become profitable.

How and when to build a team

Unlike some businesses, you will need to have a team right away. You will need cooks, servers, and bartenders as well as a bouncer or two and front desk clerks. It’s possible to start with a small, well-coordinated team, but this is not a business where you can start out doing everything yourself.

Part 2 - Is a Comedy Club business the right fit for you?

Part 3 - Action plan to launch your Comedy Club business in 90 days