7 Business Ideas to Make Money in The Creative Economy
March 24, 2016 - Uncategorized
Is it possible to thrive and be successful just on the merit of your ideas? Yes—at least in what’s known as a “creative economy”. Not only is it possible for creatives to thrive in this system, but the system itself is built on the exchange and execution of their ideas.
Author John Howkins, who has written books about the creative economy for the past 15 years, has defined the creative economy as an economy that “deals in ideas and money.”
In this economy, the main commodities are imagination, ingenuity, and innovation. The more a person or organization has these commodities, the higher the value they provide. Compare this with the manufacturing economy, where the main factors that drive value are output, trade, and consumer demand. In a creative economy, the strength and uniqueness of your idea is more important than the efficiency of your production line.
Given how organizations such as the United Nations and the Inter-American Development Bank, are attempting to define and measure the creative economy, it’s important to understand how it works and the role we play in it.
Why is the Creative Economy Important?
Despite its name, the creative economy isn’t limited to specific creative fields. As long as value is measured in terms of innovations and ideas, the concepts apply. Still, the industries that tend to produce it most include art, design, entertainment, media, and culture.
There are a few reasons why the creative economy matters now, even to people who aren’t artists or other traditional creatives. First of all, current web technology makes it possible for people to quickly and cheaply launch and promote ideas, regardless of their background and capital. For example, business practices such as lean startup shortens the development cycles of businesses, allowing them to launch products and services as quickly as possible.
Events such as Startup Weekend and various hackathons encourage participants to deliver a minimal product in a matter of days or hours, while also creating the conditions for driven creatives to collaborate with each other during this short period. Whether your idea is a simple blog or an online software suite, testing and launching your idea tends to be faster and more cost-effective today than it would have been ten or twenty years ago.
Learn more about approaches to lean startups:
StartupsThe Lean, Agile Way to Build Your First Product
Entrepreneurship54 Hours to Launch a Business
Also, many repetitive, simple jobs can now be automated. Experts estimate that by 2020, there will be a net loss of around 5 million jobs in the global marketplace. According to the same report, the primary skill that will become increasingly important during this time is one’s cognitive ability, which includes creativity, reasoning, and cognitive flexibility. This means that workers who are looking to remain competitive in the near future have to bring something extra to the table: their creativity.
Because of these conditions, it’s becoming more important for skilled workers to learn how to compete in the creative economy, where their ideas can be quickly realized and their skills are unlikely to be automated. While creative fields under arts, design, and culture are easily identifiable to thrive in this economy, technical skill is crucial as well.
What’s valuable in a creative economy is how unique and innovative your ideas are, rather than the form of your creative output. In other words, a sculptor that doesn’t do innovative work may end up producing less value in a creative economy than a programmer who builds a simple tech solution to an important problem in the world.
Thriving in a Creative Economy
Regardless of the set of skills you have, it’s possible for you to participate in the creative economy. Keep in mind, however, that competing in the creative economy isn’t for everyone. Here are the traits and skills that a person might need to thrive:
- Competence and mastery in your field. Because one’s value and input in a creative economy relies on the strength of their ideas, to do well requires competence. But it’s not enough to know the skills that are necessary for you to start calling yourself a “programmer” or “artist” or “startup founder”—you also need the vision to come up with cutting-edge, valuable ideas in your industry. You can achieve this only through deliberate practice, hard-won experience, and by generating and testing many ideas along the way.
- Entrepreneurial skills. Good ideas and competence can only get you so far. Without entrepreneurial skills to match, it will be difficult to make your projects sustainable and profitable. Entrepreneurial skills aren’t limited to the financial aspect of your idea, however. It’s also important for any creative worker to understand marketing, sales, and organization. If working with a team, management skills will also come in handy.
- Be part of a strong community. There’s a social aspect to the creative economy, whether you’re looking to launch civic-minded projects, collaborate with others, build an audience, or simply have the inspirational and mental support of a creative group. In the absence of an existing community, find or create your own. After all, in an economy that values ideas and creativity, it will be difficult to establish your role in the marketplace without the presence of others.
By being competent in your field, having some entrepreneurial skills, and being a part of a community, you increase your chances of thriving through creativity.
How to Make Money in the Creative Economy
While these aren’t specific ideas or projects you can launch, they are business models that you can use to start your own project in the creative economy.
1. Teach a Specialized Skill
Since creative workers tend to be knowledgeable in their fields, they can build a business around teaching the many skills they’ve learned and practiced over time. These skills could be technical, creative, or even include soft skills like negotiation, networking, and communication. If you have a skill that takes a long time to master, has a high barrier to entry, and is in demand, you can consider teach or coaching as part of your business model.
There are also other marketplaces for specific fields, such as Creativebug for handmade arts and crafts. There are also educational marketplaces you can check out online, which hosts a wide variety of lessons, from healthy cooking, to business, to speed reading.
But you don’t necessarily have to join a course marketplace to start teaching. You can set up your own course website, sell ebooks, or create live in-person bootcamps and seminars.
One good example of a teacher selling on their own platform is designer Nathan Barry, who publishes his own ebooks on app design, with one ebook making over $100,000 in sales. Journalist Mridu Khullar Relph, on the other hand, uses her website to sell both courses and ebooks that teach other journalists how to pitch and improve their freelance game.
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2. Become an Audience-Supported Creative
When it comes to creative endeavors, collaboration and community have an important role to play—especially if you’re depending on a specific community to finance your ideas. This is the model used by creatives who depend mostly on donations or fan-based funding. In this model, if someone likes your work, they commit to recurring donations (such as monthly or per output) or help you finance specific creative projects in exchange for exclusive donor rewards.
While many creatives can generate and manage donations on their own, they can also use crowdfunding services such as the following:
- Patreon is used by artists working in different media such as drawing and painting, podcasts, photography, and theater. Comic artist Jeph Jacques, who makes the strip “Questionable Content”, makes at least $7,000 per month from the site.
- PledgeMusic funds musicians working under a variety of genres, from hip hop to rock.
- Quirky is for crowdfunding product ideas. Among the recent products that were funded from the site are Pawcet, a dog drinking fountain, and Egg Minder, a smart egg tray that tracks when your eggs are going bad.
- AppsFunder is for funding app development), including games and productivity tools.
- Apart from Kickstarter, there are many crowdfunding sites that feature projects under a wide variety of different fields, such as Indiegogo and RocketHub.
3. “Productize” Your Skills
Another way to make money in the creative economy is by taking your specialized skills and knowledge and turning them into products. These products are often meant to be used by people who need your skill but don’t have it. These could be stock graphics and photos, design templates, or worksheets and cheat sheets that simplify complex processes.
Unlike services, which often have custom pricing and require a lot of one-on-one time with each client, products should have simple pricing and aren’t custom-made for each customer.
An example of this are the creators who participate in our online marketplace Envato Market, who sell website templates, graphic templates, videos files, and more. Learn how to become an author and start selling. There are over 6 million users across eight marketplaces participating in this vibrant economy.
Learn more about earning income from selling stock and how to productize your services:
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4. Publish Content
When it comes to ideas, one way to make them shine is by creating engaging content that appeals to your target audience. This content can stand on its own to help you establish yourself as a serious player in the creative economy, or it could be its own income generating venture.
A popular example of this is the site Brain Pickings. Writer Maria Popova initially started the site as a personal project for her friends, but it eventually became one of the most popular sites on the web, and was even included in the Library of Congress permanent web archive.
The site generates income through reader donations and affiliate commissions from the books that Popova writes about. Though the site is ad-free, many other content creators often use advertising to make money from their content.
Apart from blogs, content creators can also produce podcasts, videos, and other media. Get started with producing your own content:
PlanningTwo Very Different Ways to Create a Profitable Authority Blog
BloggingHow to Monetize Your Authority Blog
5. Create Problem-Solving Tech Tools
For the more technologically inclined, creating problem-solving inventions or innovations is a great way to make an impact in the creative economy. These products are often the output from processes like the “lean startup”, which requires a lot of user feedback and design iterations, with the objective of releasing a product quickly into the wild.
Your innovation doesn’t have to be world-changing—although that helps—it just has to solve a painful problem for others. If you want it to be profitable, your target users should be willing and able to pay for your solution as well.
One example is Bidsketch, which helps freelancers and service professionals create proposals quickly. Another example is Slack, a messaging app that has grown so much in popularity that it’s used by many organizations from Buzzfeed to the NASA Jet Propulsion Laboratory, as well as our teams here at Envato.
6. Provide a Platform for Other Creatives
The go-to idea in a creative economy is usually to make something yourself, but it’s also important to partner with other creatives and give them a platform to promote their ideas and products. This could be in the form of paid events, such as conventions, workshops, and panel discussions. You could also work the publishing, promotion, and distribution end of their work. In this model, it’s like you’re the gallery owner or the art dealer rather than artist.
Notable examples include the Circles Conference, where creatives attend workshops and panel discussions, as well as network with each other. There’s also Radiotopia, which is essentially a podcast network comprising of independent producers who make story-driven shows.
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7. Invest in Other Creatives
This is similar to the above idea, but you have more skin in the game by financially investing in other people’s creative ideas. If you’re especially savvy in business and finance, you can invest in the businesses of other creatives. This type of opportunity used to be restricted only to venture capitalists with a lot of money to invest, but with crowdfunding becoming more common, there are now many options for startups where early investors get equity in return.
One disadvantage of this model is that it’s a high stakes game requiring deep knowledge of investing and business. It’s not an ideal entry point into the creative economy.
What Will Your Future Look Like in a Creative Economy?
Given all these options, you can start thinking of ways to use your existing skills and ideas to participate in the creative economy. You can use one of the above ideas, or blend more than two ideas together. The important thing is that at the end of the day, your ideas are deemed valuable and useful by others.
Source: Photoshop | Tuts