How to make money as an artist
How to make money as an artist means supporting the lifestyle you want to live. It points out that cash flow is one of the primary aspects of any business. Also, it suggests you should cut off recurring costs first so you can sustain your business longer. If you don’t have money, how to even pay rent, buy food and water to sustain a living and make art? This is a chicken and egg question. An artist could learn from an entrepreneur mindset:
– David Cheifetz
– The Blue Review
Start Your Art Business
In the startup world, the first thing you need to gather is startup capital. Startup capital refers to the money that is required to start a new business, for example, rent a studio space, buy art supplies, make a website and social marketing or any other expense. Startup capital is also referred to as a ‘seed fund’.
Startup entrepreneurs could get their startup capital from the bank or investors (angel investors or venture capitalists). If they get bank loans, they have to pay back with a higher than usual interest rate depending on the riskiness of their business. When an investor put in the money, he has a percentage of this new business. He can make decisions and drive the business if he has over 51% of the equity. Next time when you hear other entrepreneurs say they have got investors, don’t feel jealous, it might not be a positive thing.
To be in control
As an artist, you probably could not secure a loan or an investment due to the nature of your business. The best bet you have is getting money from Family Friends and Fools (3Fs) or save up for it yourself. Ask people in your inner circle to help out. If they don’t have the resources, you can still do it, but on your own. How much money do you need to embark on a full-time art career? Earn that money. The advantage is you will be in control of your own art career and art business. If you are serious with your art, make sure you have a simple business plan and gather for your startup fund.
-Billionaire J. Tomilson Hill one of the world’s top art collectors, to Michael Xufu Huang
Gather a team
No company raises money without a fully formed founding team. Tech companies are not trying to raise money to hire their CTO.’
Adding the teamwork to the art world
This is very true in the world of art too. Many artists thought as long as you can paint or draw, you can become an artist and make good money. You just talk to an art dealer and they will sort everything out for you. It doesn’t work! You are the owner of your art business. You need to cover many different aspects of running a business. Just collaborations with dealers are not enough. You need your own team.
Who you need
Each artist is different, therefore each art business is different. I cannot tell what kind of skills you should look for, but you need to cover a few functions, here I made a small list:
- The art director.
- The art market expert.
- The social media manager.
- The web ninja.
- The graphic designer.
- The photographer/filmmaker.
- The business manager.
- The accountant.
- The researcher.
- The general manager.
- The assistant.
Attract the right people
You must have heard many stories in the startup world: someone left Google to work on a startup. Why? Because they found something more important than money or a secure job. You, the artist, as an employer, obviously cannot beat Google for the salary or welfare. You need to be able to attract capable people to work for you by offering them something more.
You are not alone
Remember, You can not achieve everything alone. You don’t work alone and you don’t take all the glory alone. Art school might be taught you to work as a solo artist, but in fact, you should play in a band. While you are still building your team, try to learn as many skills as possible.
‘Not having the right team’ ranked as the 3rd biggest reason for a startup business to fail. Think about it, artists shouldn’t be an exception to the rule.
-Doke – DokeTV Youtube channel
Equity and artworks
Today I would like to talk about equity and artworks. These two subjects might seem to be unrelated…
What is Equity?
Equity can have several meanings in a different contexts. In the startup world, equity refers to the shares that a co-founder or investor is entitled to. It is usually represented as a percentage of ownership in a company. Equity can also mean stocks or shares. Perhaps you have heard stocks more often, like the stock exchange. Stocks, shares or equity are interchangeable in this scenario. they all represent the ownership in a company.
Now you might say: Alright, I got it. I have 3 founders in my art business. I invest the most so I get 50%, the other two co-founders get 25% each. Sure, no problem! You can split the shares however you want, depending on the money, work, and IPR you invest in. You are the founders, so you can rationalise it your way.
Artwork as a Share
Now I challenge you to think about this: your artwork is a share of your art business, and your collectors are your shareholders. They spend their money investing in a piece of your art because they believe in your potential growth as a brand. What you have to do, is to maximize your shareholder value.
I know it can sound very brutal and shocking. When I was in my first accounting class, my professor asked us: what is the goal of doing accounting. What is the goal of running your business? I was like: ‘Make a better world?’ She told us one version of the answer: ‘Maximizing shareholder value’. Of course, this is a free-market way to understand business. It could give a bad connotation: you might be overlooking the social value you bring to society.
Issuing a share to a collector
I don’t agree with this statement in business, however, I think it works in art. You are an artist, you spend time making this product that is limited and high in potential growth. It’s like if you are issuing a ‘share’ to a collector. You have the right to issue it to whoever you wish, at what price you think it’s right. By owning this piece of art, your collectors now have a stake in your business. You need to represent their interest, as well as the interest of your shareholders big or small.
I think that’s why the Juxtapoz magazine art world is so popular now.
This “low-brow” art style has overtly cut any ties to the traditional avant-garde.
The posture is: “We’re just plain old working-class folks making sexy art for the people.”
And young people really glom onto this stance. “
-Interview mag – Glenn O’Brien – 2008
-Photo Craig McDean
Scaling your art business
Ask yourself before launching your art business: is it scalable?
It’s the ability of your project to scale. Perhaps you have not yet thought about it when you first plan your art business. It’s normal because we don’t normally think about scaling in the art business. But if you have a closer look, most of the established artists were prepared to scale. Yourself alone producing one artwork every month will not get you very far. You need to think about scaling and have a strategy to scale if you wish to have a team, earn more than just a salary, or become successful in the art market.
#1: You need a team
The first thing you need is manpower. You might need a business manager and a social media manager to start with. You need to at least be able to provide your team with a minimum salary or covering food & accommodation, transport. Once you start selling, you will need more people on your team. Make sure you have the money to sustain your team. You can’t go around and say you will give a percentage and ask people working for you for free. It might be quite common in the world of the art dealerships, but they are not your team! They are your sales channels.
#2: Make more art: Market share
The next step is to make and sell more art to more people. Certainly, you can just start making more original works of art, but it doesn’t have to be actual artworks. It can be art print, copyright licensing and other art merchandising. Just get your art out there while getting paid – that’s the principle. What you are doing is to get more ‘market share’ so you can establish yourself and dominate your niche.
#3: Take care of your Cash Flow
Once you start to make money, you need to take care of your cash flow. If you are not sure how to manage cash flow, read some articles on how to manage cash flow as a startup. There are a few tips and rules to follow in order to sustain and grow. Remember to reinvest in your growth, such as hiring, R&D, marketing, etc. Anything that can help you grow your team and market share.
Growing according to your values
Of course, growth isn’t everything. Don’t bite off what you could chew. Grow with a plan, say ‘no’ to expansion if this is what you need. Choose the growth strategy that is aligned with your values. For example, you can choose to stay small in your region but enter a new market so you can bring your art to other cultures. Why not? You could grow however you wish. Make sure you have a plan at hand.
Artists and their competition
Why people should choose your artworks instead of theirs? This chapter is about competition.
In business, competition is good. It means there is a market for your product. Competition as a part of the market research, without being emotional. But I found it very different when it comes to art. When an artist friend of mine was talking about another artist with a similar style, he got really upset as if he was being ‘copied’, but at the same time, it did not qualify as a copyright infringement. I just think artists could approach competition in a business manner.
You don’t have to go head to head against established artists. Pick a niche with low competition. If you don’t have a lot of capital or a large team, just start with a small niche. Instead of street art, you can compete in the ‘photorealistic street art’. Instead of abstract painting, make ‘blue abstract painting’. Start somewhere small and slowly grow and expand.
The artist narrative
Tell a story that separates you from your competitors. Once I saw a statement online: the artist doesn’t matter, it is the artwork that matters. It might sound misleading. It does not mean the story of your art brand doesn’t matter. On the contrary, you should be able to tell your story through your artwork. Like when a filmmaker is making a movie, you tell the story in the movie. You shouldn’t need a behind the scene video to explain the story.
It’s time to be social with your collectors and fans so you can build your own community. They will carry out your message, buy your art and support you. Make sure you include them and spend time doing ‘customer service’ and ‘social marketing’. The best part? You won’t even feel that you are doing marketing. It’s just like having a chat with friends.
Find your difference
You might say, I have an idea but the niche is already taken. Of course, we are in the year 2019, almost everything has been done before in human history. It’s OK to be the second who does this art, who makes this kind of work. You just need to use your story and find your community and differentiate yourself from your competition.
Also, instead of competing against other artists, consider collaborating with them.
Sustain your art business
No matter if you are a creative entrepreneur or a tech company, you need to maintain a healthy cash flow to sustain your business. Here I will list a few cash flow advice applicable in the art world.
If your artworks don’t sell for a long time, stop making more. These artworks don’t sell for a reason, so making some more of the same thing probably won’t help. You can’t just keep spending on production while building your inventory without any reaction to the current situation. Instead of making art, perhaps work on social media promotion, or talking to your sales channels. Maybe you should get feedback from your customers so you can build better products.
#2: Get paid early
Would you prefer to receive 100$ now, or 110$ tomorrow? The right answer in business is: now is always better. Who knows what will happen in the future? Many artists do commission works. Make sure your customers pay you as much as possible upfront. Pre-sell your art when possible. This way you can use this money to pay your bills and get your business going.
#3: Pay later
Pay later doesn’t mean pay late. Many bills have a due date, for example, taxes, material costs, rent. Don’t pay your bills until the last day so you can use this money until the very last day. Of course, make sure you don’t go over the due date. For recurring costs like rent for your studio or office, you can simply set an automatic transfer on the last due date.
#4: Minimize uncollectible accounts
Uncollectible accounts, or also called accounts uncollectible, is the money other people should pay you but they would not for various reasons. Basically, it’s bad debt. You have lost hope, and you just assume it’s not going to be paid. Imagine you have a customer who should pay you the remaining of the commissioned work, but he went bankrupt. Before receiving work, do a small risk analysis. The artworld is small, ask around your contacts before accepting a big order or a large commitment. Sometimes some things are too good to be true.