Growth company vs. Lifestyle company: Which is right for your art-based business?

Understanding the differences between a growth company and a lifestyle company is critical in building your art-based business, so let’s dive deeper into what each is and which is right for you.

Photo by Micheile Henderson on Unsplash

So you want to start a creative business in order to start making money by doing what you love. You want to become an artrepreneur! But what kind of company do you want to create? The topic of growth and lifestyle companies has been critical in this blog, so let’s dive deeper into what each is and which is right for you.

Growth companies vs. Lifestyle companies?

Think: Disney vs. Your favorite local business

Think about how a company like Disney differs from a locally-based, small company. Their target market is bigger, operations are geographically spread, and costs to run the company are huge. The more people who watch their movies and go to their theme parks, the more money they make. However, a common misperception about these types of growth companies is that they are always super profitable, which isn’t the case. As a smaller company, your favorite local business has less costs to cover and more direct access to the local market. Which one is more profitable depends on how much revenue each business brings in, in comparison to the amount of money they spend.

For example: A growth company might make $100 million dollars in 2019, but perhaps they spent $150 million in the same year. This growth company is not profitable. On the other hand, a lifestyle company might make $500k dollars in 2019, and only spend $50k in the same year. This lifestyle company is wildly profitable.

In deciding if you should pursue a growth company or a lifestyle company, scalability is the most important consideration. Scalability refers to how big and widespread your company can potentially grow. If you’re a painter who provides super-large, high end murals to wealthy customers, you might only have 10 clients a year. And since you are your product, meaning that its your skillful art that is being paid for, you can’t hire just anyone to complete the client’s request. Your goal here isn’t scalability, its to make more money with every client as time progresses. Maybe you start with charging $10k for a mural, then $20k, then 40k, and so on until one day you are making $500k per mural. That’s the ideal kind of growth for a lifestyle company.

A growth company, on the other hand, often includes a product of some sort that can be duplicated and reproduced as many times as the number of customers wanting it. Think about Disney again. The more times people watch one of their movies, the more money they make. Or think about authors. The more copies that are sold of one book, the more money they and their partners make. These are examples of businesses that become ultra-successful based on scalability.

For example: If you’re starting a comic book company, your growth is going to come from numbers: how many copies or subscriptions can you sell? Unless you create custom comic books as gifts for hundreds of dollars… In that case, you want to scale up your paycheck, like the muralist we just discussed–you want to pursue a lifestyle company. Not surprisingly, this creative business is meant to support you, and your lifestyle.

NOTE: It’s important to understand that lifestyle companies can become growth companies in the future. In fact, you should always be thinking about opportunities to create a scalable aspect of your business. By doing this, your business can make money that’s not directly related to your amount of working hours. Now, your company can work even while you don’t, and can potentially transform into growth company.

For example: Imagine if, in addition to high-end custom murals, the muralist decided to create mural duplicates that could be applied to walls via adhesive by the customers themselves. The muralist could create 5 designs and then try to sell as many as possible via an online store or offline retailer. The more duplicates the muralist sells, the more money they make. This would be an interesting way to add scalability to their creative business.

So why is this so important? Because it’s going to set your expectations and help you understand how to create the appropriate business model for your future creative business.

Start thinking about lifestyle and growth companies, and try to decide which would be best for you and your artrepreneurial vision!

Peace, Kayla

P.S. Follow Artrepreneurship – where ‘art’ and ‘entrepreneurship’ meet to make your artrepreneurial journey easier!

3 Misperceptions About Entrepreneurship That Every Artrepreneur Needs to Consider

How many times have you heard the phrase: “I want to be my own boss,” and thought, “Yup, that sounds pretty great!”?

Here at Artrepreneurship – where ‘art’ and ‘entrepreneurship’ meet, I’m dedicated to sharing straight-to-the-point information that’s critical for any artrepreneur’s success. That’s why I think it’s important to discuss 3 of the most common misperceptions about the entrepreneurial world.

Photo by Tim Sao Koo

No bosses

How many times have you heard the phrase: “I want to be my own boss,” and thought, “Yup, that sounds pretty great!”? I’m betting lots. Me too. But what I’ve learned in my time counseling entrepreneurs and small business owners at the Nevada Small Business Development Center is that even as a business owner, you will have a boss–the customer. As an entrepreneur, you work for your paying customers and clients. Might sound cheesy, but it’s true. You have to keep the customer happy, because without them, you don’t have a job. Their preferences will decide a lot of what you do, so be ready to work your hardest for them.

Even further than that, when companies become large enough to “go public,” shareholders and board members become the boss, and CEOs must still report to someone. So if being boss-less is your goal, entrepreneurship only gets you so far. My suggestion is to remove this hope from your mind and focus on how you can be the best employee in your company. After all, you are the first employee of your own creative business!

More vacations, Less daily work

Social media and word-of-mouth have somehow engrained in the public the idea that entrepreneurs enjoy a 4-day work week and take vacations whenever they want. This couldn’t be farther from the truth, especially in the first few years of starting your own business. In fact, most micro-business owners are working an average of 52 hours a week, and Gallup found that 39% of owners work over 60 hours a week. Even further, many millionaire entrepreneurs suggest working 12-16 hours a day in the first few years of building your business.

Obviously, it’s up to the entrepreneur how much they can, and want to work. But most who are successful choose to work at least the typical 40 hours a week that many people think entrepreneurship will help them to escape. If you’re looking to work less, consider designing a lifestyle company that can provide you enough income to cover your expenses, without guaranteeing potential growth. If you’re looking to become the next big name entrepreneur, work on developing a growth company business model that is scalable, and be ready to work hard to grow it!

Entrepreneurs are millionaires

Due to the popularity of a few well-known entrepreneurs like Jeff Bezos and Mark Zuckerberg, some people assume that all entrepreneurs are rich. What isn’t so popular is the fact that most entrepreneurs are small business owners, and don’t actually make millions of dollars every year (99% of business are small businesses!). In fact, Sokanu claims that entrepreneur salaries usually range from $10,400 to $129,200. And according to Fox Business, the average is around $68,000 a year. Obviously, the range of entrepreneur salaries is broad–some become millionaires, but some go bankrupt.

This is why it’s important to create a killer business model before embarking on your artrepreneurial journey, and to truly understand whether you are trying to build a lifestyle company or a growth company. Keeping your expectations realistic can help you build the creative business you dream of.

NOTE: I don’t say any of this to discourage you. But I do want you to have a realistic perception of entrepreneurship before deciding to embark on your own artrepreneurial journey. Being an entrepreneur, especially an artrepreneur, is not easy. But for the right people, it can be the perfect fit. Let your WHY drive you, and follow Artrepreneurship – where ‘art’ and ‘entrepreneurship’ meet to get more straight-up information that will help you along your artrepreneurial journey!

Peace, Kayla

5 Mistakes Creative Entrepreneurs Make

I hope this list helps you avoid learning some lessons the hard way, like I and so many others have. But even if you do come across some mistakes of your own, remember that there’s a lesson behind every mishap–you just have to be looking!

Photo by artist Anna Shvets

Let’s dive right into it! Here are common five mistakes I’ve discovered along my artrepreneurial journey:

#1 Not tracking your time

How long does it take you to create a finished art piece? How long does it take you to develop the concept for a new project? How much time do you spend with your customers before you actually get paid? The answers to these questions are so important, because they help you understand if your pricing is fair.

For example: Maybe it only takes you 15 hours to paint a mural, but you spent 10 hours collecting materials and 15 hours developing the concept art. Let’s say you charged $1,000. If you aren’t tracking your time properly, you’d think you’re getting paid $67/hr for 15 hours. Sounds nice, right? But in reality, you’re getting paid $25/hr for 40 hours. Tracking your time will tell you how much money you’re really making. You wouldn’t work off the clock for an employer, so don’t do it at your own company. Value yourself and your time!

#2 Not being able to quickly and concisely express your value

Ever heard of an elevator pitch? It’s a 30-second monologue that can be given in the time of an elevator ride, in the case you ever get the chance to ride with someone big. In this elevator pitch, you’re concisely sharing about your value: what you do and why you do it. Feel like you could pitch Jay-Z or Bill Gates in 30-seconds? Maybe not. But what about a potential customer? This is something you should get comfortable with–practice makes perfect.

Note: It might be called a pitch, but that’s the last thing you want customers to feel when you deliver it. Be familiar enough with your value and messaging that you feel natural when speaking. Try practicing with your family, friends, and creative business partners. It will take time and practice, so don’t be afraid to mess up. 

#3 Not evaluating what has business potential and what doesn’t

Sometimes it can be hard for artists to recognize which product or service ideas have the best business potential, because the beauty in one’s work is always self-evident. But remember: the value of your product should be measurable in cash, not just beauty. Don’t ask yourself, “Would I pay for this?” but ask yourself, “Would other people pay for this?” How do you know if other people would pay? Ask them! Do some research online. Talk to some potential customers and see if they bite. With every new idea, you should evaluate it’s business potential

Remember: Testing your creative business idea, thoughts about your potential customers, and other assumptions about your artrepreneurial journey is going to be a major key to your artrepreneurial success!

#4 Not checking your ego

If you feel like you can skip mistake #3 because your idea is just that good, mistake #4 is extra-important. Ego can often cause opportunities to be missed and good advice to be overlooked. I say this from a place of humility, as this particular “mistake” comes from my own experience. You don’t want to create a barrier for yourself as you work hard to build the creative company of your dreams. Be ready to learn, ask others for help, and become vulnerable as you collaborate your way to success!

#5 Not really wanting to be a business person

This is a tough one. Because you’re an artist, I assume that you love spending time creating your art. But if you want to pursue “artrepreneurship,” you’ll need to become a business person, too. This means that you might have to go to meetings and send emails and think about your business model and value. That’s what being an entrepreneur is all about. But what’s so cool about artrepreneurship is that you don’t have to be just an entrepreneur, and you don’t have to be just an artist… you can be both

If you think being a business person might not be right for you, consider bringing in a business manager who understands your value and is looking to play the yin to your yang. You’ll still need to learn the basics of the ‘other side,’ but now each of you can focus on your favorite side of the artrepreneurship dyad. Both (or even all) of you can build a successful creative business together!

I hope this list helps you avoid learning some lessons the hard way, like I and so many others have. But even if you do come across some mistakes of your own, remember that there’s a lesson behind every mishap–you just have to be looking. 

Peace, Kayla

P.S. Follow Artrepreneurship – where ‘art’ and ‘entrepreneurship’ meet to get the straight-up and straight-to-the-point information you’ll need to be successful on your artrepreneurial journey!

Building a Brand Around Your Art

Building a brand around your art is a crucial step in developing your very own art-based business!

Whether you want to be a popular freelancer or the CEO of your dream creative company, building a brand around your art is a crucial step in developing your business. We brushed the surface on how to build a brand in this article, but maybe you need some more time developing a brand that’s truly what you envision. Good. Building a brand is one of the most important things you can do to ensure long-term success in your artrepreneurship endeavor.

As a refresher, there are two questions you must answer that will act as the core of your brand: What is your value? and What is your messaging?

Your Value = Your customer’s problem + Your solution

Your value revolves around the problem you’re helping to solve for your customers. Are you providing them a way to reach more customers? A way to share their feelings or overcome obstacles? A way to build or share their own brand? Get specific. What problem is your customer facing, and how do you help them solve it?

Your Message = Your value + Your customers’ personality

Cool. You have a good understanding of what value you provide. Now, you need to think about how you’re going to communicate that value with your potential customers. The key here is: your potential customers. To understand what kind of messaging will appeal to them, you must UNDERSTAND THEM. Who are they? What do they like? Where do they frequent? Who are their friends? Who do they ask for advice? What kind of image do they try to portray? Who do they want to be? Try to understand what motivates and interests your potential customers, so that you can communicate with them accordingly.

Once you understand your customers better, you’ll know more about how to approach them. For example, should your brand be casual or super professional? Artsy, modern, or classy? Fun, relaxed, or serious? The easiest way to answer this question is to look at your potential customers and think about their image. Are they casual or super professional? Artsy, modern, or classy? Fun, relaxed, or serious? People have a tendency to be drawn to what is like them, so you should try your best to make your brand reflect them and everything they want to be.

Your Brand = Your value + Your messaging (in action!)

Now that you have an idea of what your value is and how you’re going to share that value in a way that is familiar and interesting to your potential customers, create a document that captures the core of your brand. Make a list of keywords that relate to your customers’ key problem. Write out some words that reflect the “vibe” of your brand. Jot down some sentences that feature the popular language of your target customer. This document is SUPER important and will serve as the core of your efforts from here on out. If something doesn’t fit in or match your brand document, don’t say it or do it. This document will help guide you as you continue to build and share your brand and business.

Lastly, you should also develop a brand or mood board that features the visual elements your brand. What kinds of fonts, colors, and other visual elements capture the brand you’ve described in your brand document? Here’s an example of the branding board I created for CREATIONS Film, the creative company my husband and I founded together:

Branding Board Example for CREATIONS Film created by Kayla Banda

Remember: Building a brand is a commitment, not just a one-and-done brainstorming session. Visualizing your brand is one thing (that’s what we’ve done here). But actually creating that brand takes time as you market, work with customers, and build an online and offline community. Use this brainstorming session as a guide to help you make decisions and continue building your art-based business!

Create your own branding document and branding board, and share about your experience below!

Peace, Kayla

P.S. Follow Artrepreneurship – where ‘art’ and ‘entrepreneurship’ meet to get fresh, new content as you work on building your very own creative company!