This is a good article about how to find funding through your fans.  Here is an excerpt.  If you want to read more, go here.

Emerging musicians are in an eternal struggle against two evils: funding projects and growing a fanbase. In the past, musicians have funded their own albums, and have used it as leverage to gain more fans. But artists on a fixed income may run into issues funding their own projects, which can have harmful effects on the quality of the final product.

Of course, the next option is to release a demo or EP and work on building a fan base, meanwhile shopping around for a record deal with a major or indie label. The benefit here of course is that all of the financing of the album is accounted for, but lets face it, this is not the easiest thing to pull off. Labels typically won’t even look at you until you’ve crossed the 10,000-units-sold mark, and unfortunately that is becoming an increasingly difficult task to accomplish:

…in 2008 there were 1500 releases that sold over 10,000 album units. Out of that there were only 227 of them that were artists that had broken 10,000 for the first time. So in the whole year only 227 of the artists were artists that had broken what we call the “obscurity line.” When you sell 10,000 albums, you’re no longer an obscure artist; people know about you. You may not be a star yet, but you’re in the game. That gets you out of the glut and into the game. We looked at the 227 and identified that only 14 of them were artists doing it on their own and all the rest were on majors and indies; a little more than half were on indies.

~Tom Silverman Founder, Tommy Boy Records

And more often then not, you as the artist are stripped of some if not all creative control, resulting in an album that may work for the fans, but doesn’t work for you.

The only option left, is to find someone else to fund your project. Why not the fans? With digital distribution and social networking on the rise, fans have more music at their finger tips than ever before. Therefore artists are trying all sorts of unique ways to engage their fans, empower their fans and create their own community of fans surrounding the music. What better way to engage and empower the fans than fan-funding your next project?

To read more about fan funding, read the entire article here at Music Think Tank.