Profit in the Arts: Are All Projects Worth Funding?

Trivia Time! Whose business model is this?

Our core operations are sustained by earned revenue drawn from [our products/services]. This is by design. We believe that if the services we provide create real value for our [customers], then they will be willing to pay a reasonable amount for them. This approach also provides a built-in evaluation gauge for our work, meaning that our [customers] will tell us - quickly and unambiguously with their buying power - whether our [products are] having a positive impact on their lives.

Apple?  Toyota?  The entire pharmaceutical drug industry?  Nope.  Need a clue?  Let me restore the bracketed words to the original:

Our core operations are sustained by earned revenue drawn from membership dues and program fees. This is by design. We believe that if the services we provide create real value for our members, then they will be willing to pay a reasonable amount for them. This approach also provides a built-in evaluation gauge for our work, meaning that our members will tell us - quickly and unambiguously with their buying power - whether our work is having a positive impact on their lives.

Yes, that’s item #1 of the brief, succinct Fractured Atlas business model. I was taken aback when I came across it last month (contrary to popular belief, I’m not an FA employee, just a fan), and it took me a moment to figure out why.

An arts organization - a nonprofit! - is founded on the premise that they should produce stuff people will pay for?!

Why do so many arts professionals seem to believe that the arts are exempt from providing value?  Market-worthy, marketable, customer-satisfying, money-making value?

If you are working in the arts professionally - that is, being paid or expecting to be paid for what you do or create, is it really so scandalous to try to create something that will generate enough revenue to pay for itself?

Artists are innovators, risk takers, dreamers, doers.  But not every idea is viable.  Yes, risks must be taken.  But risk is mitigated by research, experience, and above all, common sense.

In the arts, we have huge funding opportunities that other industries don’t: unique tax breaks, nonprofit status, fiscal sponsorship, grants - not to mention funding by private donors - whether the art is for a cause or the art is the cause.

Many excellent ideas never get off the ground due to a lack of funding, but the lack of a solid pitch is equally tyrannical. Part of the business of launching anything is to create the marketing strategy — and that’s all communications, from fundraising appeals to selling tickets to audience growth.

The era of turnkey, online fundraising has blurred the line between arts initiative and vanity project.  An idea-ist can set up a Facebook event, Kickstarter campaign, or IndieGoGo page in one minute and solicit his entire extended network for money the next. I’m a big fan of tools that make communications easier, but speed is not a substitute for strategy - or respect for your current and potential audience.

Here’s the danger, especially if you haven’t already jumped through the hoops of getting nonprofit status or fiscal sponsorship: if the pre-funded project is - or seems - primarily designed to build your resume, increase your income or professional opportunities, or otherwise increase your artistic status, you risk turning off your ticket-buying and buzz-spreading audience before the project even exists.

I’m not exempt; I actively apply these principles to my own business - even when it tests my ego.  Instead of rushing to introduce a service every time a new idea arises, I try to push through the process of surveying my potential audience, evaluating my current resources, formulating a product based on what people want (versus what I want to create), pricing it appropriately, then marketing it strategically.  I partner with my clients as they work through this process too.  It can be frustrating to temper the passion of the creative spark (yes, my actual passion is creating marketing strategies - goosebumps!), but deliberation at the start can save a lot of heartache in the end.

To oversimplify: if an idea is solid and its promotion is on point, the funds should follow.  If it doesn’t sell, I can fix it or abandon it for a better idea.

Build your audience diligently and approach them with respect.  Solicit their feedback.  See if your idea provokes action.  And if it doesn’t, re-tool and re-present - or swallow your ego, embrace your creative spark, and come up with the one that will.


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9 Responses to “Profit in the Arts: Are All Projects Worth Funding?”

  1. Doc Waller:

    Ciara,

    Your articles are always so honest and direct. Every arts organization director should have a little palm-sized “Ciara” to place on their desk.

    Keep it coming.

    Creatively,

    Doc

  2. Kit:

    Where are these huge funding opportunities for the arts? Please tell us, we need to know! Or are you talking about Europe?

    The problem with equating value directly with “market-worthy, marketable, customer-satisfying, money-making value” is that it ignores the research and development aspect. I think this is why people work in the arts quite rightly argue for their work to be given breathing room from market forces - just like the R&D aspect of any other endeavor. If you don’t invest enough in R&D, then the culture suffers, be it the market culture or anything else - and the non-profit arts is where the vast majority of the R&D happens.

  3. M. Abdallah:

    This view contradicts itself when it comes to applying business standards to the arts, and here is why: Unlike virtually all businesses and industries, the arts cannot increase its productivity. As Michael Kaiser always says: it takes the same number of musicians to perform Mozart when it was written as much as today.

    Another implication of that truth that is usually overlooked, is that once you have decided on the venue in which a given work is presented (say a concert hall) you have basically determined the maximum number of tickets you could sell. And hey, anyone with minimum experience in financial management of theaters would tell you that unless you are a Broadway theater, you don’t really make profit from ticket sales.

    I think it is utterly dangerous to engage in this process of ‘justification’ for the arts through repeating the 90’s mantra of ‘art bringing market value.’ Art is not capitalist, and should never be. As Badiou puts it ‘The only maxim of contemporary art is not to be imperial.’

  4. Kit:

    @ M. Abdullah

    While I agree with the spirit of your response, I have to disagree with your premise.

    According to your view of productivity, the income potential of, for example, the Metropolitan Opera is limited to the capacity of its physical buildings. Yet I have read that broadcasting initiatives such as the live cinema feeds and the broadcasting deal with SiriusXM is now bringing in something in the region of $11m per year. The Berlin Philharmonic’s Digital Concert Hall is another example of a classical music organization vastly increasing its potential audience - and productivity, and potential income - via new technology.

    The problem is that only the very largest institutions are able to compete on this lucrative turf. Thus widening the gap between the haves and the have nots in the arts, as well as everywhere else.

    Perhaps this is why these arguments are coming up now - the profound shift to digital culture that we have been witnessing has thrown all the cards up in the air, and the prevailing wind is blowing them towards the big, well-funded institutions. Which is great for places like the Met - which I think is doing fantastic work, and being very smart about it - but not so great for mid-size and small arts organizations.

  5. M. Abdallah:

    @ kit
    Thanks for the swift response (and for subscribing to my little modest blog)

    I think you have said it: only the very largest institutions are able to compete on that level.

    On another note, you must admit that a shift to the new technology in the case of the Met and others, brought about a shift in the practice, i.e. the concert hall experience. Conservatism aside, one cannot deny that seeing the Met on big screen is nothing like attending a live performance, where the relationship between artist and audience is direct and organic (even if thy do the ceremonial chandelier lowering at the SiriusXM)

    I am not against new technologies, I am against amending an artistic practice to open more market horizons, and to adopt market values in a practice that functions on different values.

    Your entry prompted further reading at my end, here http://www.artnet.com/magazineus/features/kuspit/kuspit3-6-07.asp

    Thanks again for the reply.

  6. pressler:

    What are your thoughts on Cirque du Soleil? They’ve created a profitable live performance model.

    Also, we’re all combining two separate things that should perhaps be discussed separately: arts services vs artistic presentations.

  7. Mia:

    ‘Why do so many arts professionals seem to believe that the arts are exempt from providing value? Market-worthy, marketable, customer-satisfying, money-making value?’

    - Because the not for profit art institutional model doesn’t correspond to the art market in such a direct way. The value created is not always monetised, and when it is, it doesn’t happen through this channel. We do not see the profits of any of the value creation that we develop through increasing the profile of artists. That is left to the gallerists and, hopefully, the artists themselves. There is a good reason for this structure - to escape the exact deadening market-led thinking that you propose.

    ‘If you are working in the arts professionally - that is, being paid or expecting to be paid for what you do or create, is it really so scandalous to try to create something that will generate enough revenue to pay for itself?’

    - Yes. Because revenue is not the only funding model for the arts, in fact as M.Abdallah says, in the entire history of artistic production it has rarely ever been sufficient. So it’s a good thing we have another one.

    ‘Artists are innovators, risk takers, dreamers, doers. But not every idea is viable. Yes, risks must be taken. But risk is mitigated by research, experience, and above all, common sense.’

    - It depends on how you define ‘risk’ and ‘common sense’. I work with artists precisely to produce something other than common sense.

    ‘In the arts, we have huge funding opportunities that other industries don’t [...].’

    - Aside from being US-centric, the comment is the tail wagging the dog. Not for profit status, tax breaks, private donors, grants, are there precisely because the revenue model limits creativity in the extreme.

    ‘Many excellent ideas never get off the ground due to a lack of funding, but the lack of a solid pitch is equally tyrannical. Part of the business of launching anything is to create the marketing strategy — and that’s all communications, from fundraising appeals to selling tickets to audience growth.’

    - That’s the role of the institution, sure, that’s what I do (among many other things). But you are confusing that with the role of the artist, or the key aspect of the curator’s role.

    ‘if the pre-funded project is [...] primarily designed to build your resume, increase your income or professional opportunities, or otherwise increase your artistic status, you risk turning off your ticket-buying and buzz-spreading audience before the project even exists.’

    - Right - so, artists should disregard the market (the exact opposite of what you’ve been saying). As with this entire article, you’ve missed the point. So let’s firstly rephrase this: ‘if the pre-funded project is primarily designed to build your resume, increase your income or professional opportunities, or otherwise increase your artistic status, you risk *making really terrible art*.’ That is the one and only concern. Art made ‘for’ an audience in this very direct neoliberal market sense is usually just as bad as art made for all the reasons you list above.

    ‘Build your audience diligently and approach them with respect. Solicit their feedback. See if your idea provokes action. And if it doesn’t, re-tool and re-present - or swallow your ego, embrace your creative spark, and come up with the one that will.’

    Institutions do this and I’m glad they do. We respect our audiences enormously and work hard to retain them, find ways to make our projects accessible. But this whole article neglects an important belief - and this is the reason I work in art and not marketing & promotions consultancy: the belief that good art *pushes*, rather than *satisfies*, an audience’s expectations. Audiences are far smarter than you are giving them credit for, and they can gain enormously from things they probably would never have initially bought a ticket for; and what’s more, not all of them can afford to experience art via a market (ticketing) model anyway. So, why not offer artists a space outside markets, and offer the art for free to audiences?

    If I ever, ever told an artist that I need them to rework their idea due to market demand, I hope I would lose my job very quickly.

  8. Kit:

    @ M. Abdallah

    Minor point:

    ‘you must admit that a shift to the new technology in the case of the Met and others, brought about a shift in the practice, i.e. the concert hall experience’

    I know that there is heated debate about what effect the new live cinema feeds have had on the quality of the live performances at the Met. But I wonder whether the shift you are talking about is one of degree rather than of kind?

    Live broadcasts of performances are of course nothing new - for example, Live from Lincoln Center has been going for decades. I’m sure the introduction of television cameras into the theatre or concert hall has had an effect on the people involved, but I’m not sure this has led to a significant shift in practice. The exceptionally ubiquitous glare that the TV lights shine on the HDLive broadcasts from the Met have clearly made a noticeable difference to the dozen or so performances affected each year, but the jury still seems to be out on whether this is spreading to operatic practice as a whole (and I haven’t come across any discussions about what this has meant for the concert hall - the Berlin Philharmonic Digital Concert Hall broadcasts seemed to me to be remarkably close to the experience of a live orchestral concert, given the circumstances).

  9. Christopher:

    Ms. Pressler,

    If you are talking about artistic presentations your post is even more misguided and disturbing. Using your logic, arts organizations could do away with curators and artistic directors and opt for focus groups to determine programming. Your “let the market decide” mantra for the arts is a tired refrain of conservative thinking. Equating artistic creation with the development of a marketing campaign, or any commercial product for that matter, dismisses what others have identified as the R&D part of the creating art. You ask, “Why do so many arts professionals seem to believe that the arts are exempt from providing value? Market-worthy, marketable, customer-satisfying, money-making value?” Your assumption that arts professionals hold this belief is insulting to the many professionals who see great value in their work. Art can satisfy the customer but still not recoup the investment. Sometimes customer satisfaction doesn’t equate to market success. That doesn’t mean the art was not worthy of production or presentation.