I was recently advising a creative entrepreneur in the USA. We discussed various options for devising a suitable business model for him and one option was to sell designs not products.
Chris Mansell is a creative individual, developing new ideas and products, using Arduino based electronics, specialising in interactive addressable LEDs, along with 3D design, 3D printing and CNC milling. He trades as LEDBFG and some of his products and processes are published here on Instagram.
Our starting point was his own particular definition of success. He had received offers of investment into his startup but that was for a business that was heavily into manufacturing, which would distract him from his designing of new products and tie him down in the administration of a complex business. He didn’t want that, preferring the freedom and agility of being a designer, but working in partnership with a manufacturer who would take care of production, distribution and marketing.
We also looked at options for licensing of intellectual property to manufacturers, so that he could focus on designing and prototyping then adopt a business model to “make money while you sleep”. One example is Guillherme Marconi in Brazil, a commercial illustrator who licenses(rents) his illustrations rather than sells them.
Our discussions highlighted the fact that there are many ways to develop a business, according to what you want to achieve. One of my key messages is that we can be creative in the business office, not just in the studio. Matters such as raising finance, marketing, importing/exporting, managing people and even organisational structures can be highly creative. We don’t have to do business in the usual or conventional way!
As businesses grow, there is a temptation for ‘mission creep’, to change from being a designer into a manufacturer. I can recall advising a fashion designer in the UK. She had increasing demand for her stylish dresses, so much so that she was unable to keep up with production herself. Her instinct was to employ people, set up a small workshop, and start distributing fashion ware to retailers in the UK and elsewhere. This is an option of course. But it’s not the only option! An alternative is to focus on your strengths and competitive advantage, working on designs, but in partnership with a manufacturer that can take care of production and logistics, using your designs and paying a proportion of the income as a licence fee for use of the designs. In this way you can “make money while you sleep” and sometimes the best option.
Another more radical option is to give designs away for free. An inspiring example is explained in this TEDx talk by Ben Uyeda: “Why I Give My Best Design Ideas Away for Free”.
This Freemium business model combines ‘free’ with ‘premium’ [price]. This model can make good sense, commercially and otherwise, depending on your ambitions, financial and otherwise.
I use this Freemium business model by giving away the free eBook version of my book ‘T-Shirts and Suits: A Guide to the Business of Creativity’. Like Ben Uyeda, I want my ideas to be accessible to everyone, because I’m passionate about creative entrepreneurship in the same way he is passionate about great design. But it’s not a stupid thing to do. Not only does it achieve my mission of ‘spreading the word’ about entrepreneurship in the creative industries, it works commercially too. The book acts as my marketing brochure and then I am invited to make keynote speeches at conferences around the world, design and deliver training workshops, or provide management consultancy to creative businesses. The book is available for download here and is published using a Creative Commons licence that allows anyone to copy, print and redistribute it – provided they don’t sell it or change it.
We can sometimes make more money, and become more fulfilled, by changing our business model so that we focus on what we do best, then selling, licensing or even giving away designs.
The conclusion is that we can devise our business models to suit our commercial and other objectives, to achieve our own version of ‘Success’, by thinking creatively, not only in the studio but in the business office.
Creativity is not just about the ‘art’ in what we do, it’s about thinking differently. That’s the point I made in one of my TEDx talks, in Napoli, which is online here.