1.4 · The money: three-tier budgeting
The big idea: don’t budget one event, budget three versions of it, and decide which version you’re running on a date you set before any money has landed.
The analogy
Section titled “The analogy”You already know that no film gets shot the way it was written. It gets shot the way it was funded. The script is the intention, the budget is the decision, and every experienced producer holds two or three versions of the same film in their head at once: the one they make if the grant comes through, the one they make if it doesn’t, and the honest middle. They don’t wait until the week before principal photography to find out which film they’re making. They pick a date, look at what has actually cleared, and commit.
An event budget works the same way, with one difference that makes it easier. Your funding doesn’t come from a single yes or no. It comes in pieces, from sponsors, over weeks. Which means you can watch it arrive and choose your version with your eyes open.
Segment: 12:37–25:37, hard costs vs soft costs and scrappy ways to cutwatch full video
How it works
Section titled “How it works”Most first budgets are a single column of guesses. You list what the event will cost, you add it up, and then you spend the next two months hoping the total turns out to be true. It usually doesn’t, and not because your guesses were bad. It’s because the biggest number on the income side arrives on somebody else’s calendar, not yours. A one column budget quietly forces you to commit to spending before you know what you have.
So start on the income side. Your income mix is simply where the money comes from, and at community scale there are really only two sources that matter: sponsors and tickets. The volunteer conference playbook this course keeps coming back to, DevOpsDays, is blunt about the ratio. Roughly three quarters of your budget should come from sponsorship, and their own guide pushes for more than that. The reason isn’t that ticket money is dirty. It’s what a low ticket price protects. Sponsorship is what lets you keep the door cheap enough that a student with no gear and no credits can still walk through it. That’s the anti-gatekeeping promise, written into a spreadsheet.
That same playbook is equally blunt about the other end: don’t make it free. A free ticket is not a favour, it’s a coin flip. A serious chunk of people who grab one never show up, which wrecks your food count, wrecks your seat count, and locks out people who would actually have come. A small honest price is kinder than free.
Now the expense side, and here you make one cut before you price anything at all. Every line is either a hard cost or a soft cost. Hard costs are what you pay whether one person shows up or the room is packed: the venue, the sound system, the backdrop, the podcast recording setup, the photo and video team. Soft costs move with the headcount: snacks and water, badges, printed programs, giveaways. This is the first thing the panel does in the video, and it matters more than it sounds, because when attendance comes in lower than you hoped, only your soft costs fall. Your hard costs don’t care. The film version is familiar. The camera package rents for the same price whether you shoot two actors or twenty, but craft services is per head, every single day.
Once you can see which costs are stuck and which ones breathe, you can build the thing that actually solves the guessing problem. A Good, Better, Best budget is three columns, three real versions of the same event. Good is the version you can run on money already in the bank, stripped to what makes it a genuine event and nothing else. Better adds the things that make it feel finished. Best is the version where you get to do the thing people will talk about for a month. All three are honest events. None of them is the sad version. The point is that you always have a version you can afford, so cancelling never enters the conversation.
Three columns are only useful if there’s a moment where you choose one. That moment is a go/no-go date, a date you write into the calendar now, before any money has landed, when you look at what has actually been signed and pick the column you’re running. Put it far enough out that you can still book what the column needs. The discipline is simple and slightly brutal. On that date, only signed counts. A warm conversation is not budget. An “almost certain” is not budget. If that money lands afterwards, nothing is lost, you just get to add something back.
Every column also carries one line you hope never to touch: the contingency budget. Something will cost more than the quote, or a supplier will vanish, or the rain will make you rent a tent. Convention across the industry puts contingency somewhere around ten to fifteen percent of total spend, and I want to be straight with you that this is a rule of thumb everyone repeats rather than a figure anyone has published research behind. Film budgets carry the same line for the same reason, and the discipline is identical. It isn’t spare money. It’s money that already has a job, and the job is called “something went wrong.”
Last thing, and it’s the one that quietly breaks budgets at your scale. A comp is a free seat you gave away: sponsor representatives, podcast guests, speakers, volunteers, the media friend who is covering it. Every comp does two things at once. It removes a seat you could have sold, and it still eats a soft cost, because comped people drink the water and wear the badge. Count your comps before you price your tickets, not after, or you’ll build your income line on seats that were never for sale.
One more thing worth noticing. This budget has two readers. For you and your team it’s an operating document, the thing that tells you what you can promise. The moment it walks into a sponsor conversation it becomes a credibility document, proof that their money lands somewhere organised. Same sheet, two readers, which is exactly the seam the next lesson opens up.
The receipts (evidence, if you want it)
- The three tier budget is not a course invention. DevOpsDays prescribes it directly: “Have a tiered budget for a Good, Better, Best… Whatever is a minimum viable event for you, have that planned,” and pairs it with timing: “have some go/no-go dates in mind for deciding when you can do each one. A Good vs Better event call might come in the month leading up to your event when you evaluate how much sponsorship money you have gotten in” (devopsdays.org/organizing).
- Same guide, same section, on why the ratio matters: “This is why we say 80%+ of your event budget should come from sponsorship funds! If you set yourself up this way, you know you can put on a good event for the community regardless of how many people actually come, avoiding the need to cancel.” Their income categories section states the softer version, that sponsorship can be “potentially up to 75%” of income. Treat the range 75 to 80 percent as the doctrine, not a precise target (devopsdays.org/organizing).
- On accessible ticket pricing: aim for “80% or more of your expected expenses covered by sponsors rather than ticket sales. That way, you can drop ticket prices to a nominal amount for locals, underrepresented communities, students,” at roughly 10 to 20 percent of a commercial event ticket in your region (devopsdays.org/organizing).
- On free tickets: “about 30-40% of the people ‘grabbing’ a free ticket don’t show up in the end,” which makes logistics unplannable and leaves the event looking full to people who would have attended (devopsdays.org/organizing).
- A useful health check on the income line: ticket sales should reach roughly 40 to 50 percent of expected registrations, counted excluding sponsors, speakers, organizers and volunteers, by about a month out (devopsdays.org/organizing).
- Also from DevOpsDays, an underrated sequencing rule: “You cannot announce a date until you know you have a way to handle money. Realizing too late that you cannot process money has led to rescheduled or canceled events in the past” (devopsdays.org/organizing).
- TEDx teaches deliberate overestimation: build a categorized line by line list, research each cost, and “to be safe, you’ll want to overestimate, about 1.5 times what you would normally guess.” Their money chapter also tells organizers to account for “contingency, taxes, and incidentals,” to log in-kind donations in the budget alongside cash, and to note early which items must be paid upfront (TEDx Organizer Guide, Create a budget).
- The hard versus soft cost split in the video: hard costs are the ones where “whether one person shows up or a thousand people show up we got to pay the same price,” named as AV, meeting space, branding and staff travel. Soft costs are “based on number of attendees,” named as swag, meals and anything printed (Whova, Event Insider 32, from 12:47).
- Flagged as unverified. The 10 to 15 percent contingency line is widely repeated practitioner convention. This course’s source review could not find an authoritative published source stating that range, so it is taught as a convention to adopt, not a citation to lean on (industry map §8, item 3). Panelists in the Whova episode name roughly 10 percent alongside a force majeure clause as what carried them through COVID cancellations, which is practice, not evidence.
- Honest gap. Template driven budget teaching, with real spreadsheet models and instructor feedback, sits behind a paywall. The clearest owner is the Event Leadership Institute, now the PCMA Institute, whose Event and Meeting Management Fundamentals certificate spends its Week 4 on financial management, budgeting, income and expense structure and ROI (pcmainstitute.org). This lesson gives you the framework and the discipline. It does not pretend to be a finance course.
Your one move
Section titled “Your one move”Open the Budget tab on your master sheet. List every expense line the August event will have, and put an H or an S next to each one for hard or soft. Then fill in the Good column only, with a real number on every line and a contingency line at the bottom. Finally, put one date in a cell labelled “go/no-go.” Thirty minutes, done when every line has a letter, the Good column has no blanks, and there’s a date on the sheet.
A worked example in pesos (illustrative numbers, not real Filmmakers Connect figures)
Every figure below is invented for teaching. Do not reuse them as estimates. The shape is the lesson, not the amounts.
An event built for a room of 120, with sponsor booths and a live podcast.
Hard costs, paid regardless of attendance
| Line | Good |
|---|---|
| Venue hire and venue staff | ₱25,000 |
| Sound, AV, podcast recording | ₱18,000 |
| Stage backdrop, signage, booth build | ₱12,000 |
| Photo and video team | ₱10,000 |
| Hard subtotal | ₱65,000 |
Soft costs, priced at 120 heads
| Line | Good |
|---|---|
| Snacks and water, ₱90 a head | ₱10,800 |
| Badges and printed program, ₱25 a head | ₱3,000 |
| Raffle prizes and giveaways | ₱5,000 |
| Soft subtotal | ₱18,800 |
Subtotal ₱83,800. Contingency at 12 percent, rounded up: ₱10,200. Good total: ₱94,000.
Income against it
| Line | Good |
|---|---|
| Sponsorship, three cash partners | ₱74,000 |
| Tickets, 100 paid seats at ₱200 | ₱20,000 |
| Total | ₱94,000 |
Sponsorship carries 79 percent of this event, which is where the doctrine wants it.
Now look at the comps. Twenty of the 120 seats are free: sponsor reps, podcast guests, volunteers, media. They still cost ₱90 of snacks and ₱25 of badge each, about ₱2,300, and they remove ₱4,000 of ticket income. So each comp costs roughly ₱315 before anyone has said a word about value. Twenty of them is a real line item, and it’s invisible unless you count it first.
The go/no-go date sits three weeks out. If signed sponsorship is below ₱74,000 on that date, you run Good and you run it proudly. Better adds proper catering and a printed program. Best adds whatever makes people talk.
Want to go further?
Fill the Better and Best columns too, but write them backwards. Start from the one thing you most want the August event to have, put it at the top of the Best column, and price everything else beneath it. That tells you what your ceiling actually costs, which is the number your sponsorship target should be built around, not the other way round.
The needle: an event is won before doors open, and the go/no-go date is you deciding in advance which event you’re going to be able to afford, instead of finding out during load-in.
Terms introduced
Section titled “Terms introduced”Check yourself
Your go/no-go date is three weeks out. Two sponsors have signed and paid. A third says "almost certain, I'm just waiting on my boss," and the Better column only works if that third one lands. What do you do on the date?
Registrations come in softer than you hoped. You planned around a full room and it looks like a third fewer people are coming. Which part of your budget actually moves?
A sponsor's package includes ten free seats. Add your podcast guests, your speakers, your volunteers and a couple of media people, and a real slice of the room is now free. The room holds what it holds. What did that just cost you?
You can move on when you can… sort any expense line into hard or soft on sight, explain why the Good column exists, and name the date on which you’ll choose a column and what evidence you’ll accept on that date.
Go deeper
Section titled “Go deeper”- Next up: 1.5 · Sponsorship I: the package, where the number your budget is leaning on becomes a prospectus, a tier structure, and something you can actually put in front of a brand.
- The full Whova episode, Mastering Event Budgets, runs an hour and gets into vendor and venue negotiation in its second half. Worth it if you’re about to sit down with a venue.
- The DevOpsDays organizing guide is the source text for everything in this lesson. Read the Budgeting, Handling Finances and Tickets and Pricing sections together. They’re written by people running the closest thing to your event that publishes its playbook.