Many stand up comedians start off presenting their shows in pubs/clubs and other tiny venues, as it allows them to gauge a better idea of what material the audience like and what they don't. They then proceed to move onto bigger venues and can start to charge more and more money. Some comedians manage to further their careers by appearing on TV, so people are forced into recognising their names and faces, so will go see them when they tour.

Bands do a similar thing when they start out, playing wherever they can for basically nothing, until they get their name out. When a band manages to create a decent looking music video, they may be able to hit a new audience on YouTube, and eventually get enough of a following to start playing bigger shows. Places like the Junction, in Cambridge hold an event that allows small local bands to play to a larger audience, with professional quiality light and sound techs to give them an idea of what it wuld be like when they got bigger.
People do shows because they want to share what they have created with other people who the think will like it aswell. Bigger bands choose their support acts based on what they think their fans will like, it's usually a similar sort of music, and usually a smaller band that they think should get some recognition, or just people they know. If someone has created something they are proud of, they want to show other people, it's why bands tour, it's why street performers sit out in the cold all day hoping people will watch them and it the only reason anything really gets made.
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