In the first post of this series on the Rebirth of Entpreneurialism, I showed why we’re going through a renaissance in entrepreneurship and entrepreneurial thinking. Whenever our economy changes, how we use our creativity changes. That’s what we’ll be looking at in this post.
Imagine for a second that you’re a blacksmith who makes nails prior to the rise of factories. Let’s think about the things you’d need to start your venture:
1. Raw Materials
You’d need enough ore or metal to produce your nails. You’d need coal to fire your forge, access to water to cool your forged metal, and an assorted list of other materials that go into making your nails. Without these materials, you have nothing to make.
It was possible to barter for these items, so while money was not a requirement, the access to resources was. Bootstrapping has always been a part of entrepreneurialism, but keep in mind that wages were typically so low for people who didn’t own land that it was nearly impossible to earn enough to support yourself and start a business from scratch.
2. The Means to Production
You’d need an anvil, hammers, files, and the other items that are part of the process of making nails. These items would not be consumed in the production of your nails, but they would require routine maintenance – and without these materials, you wouldn’t have a way to create your nails.
Within this category are also the skills required to make nails. Commoners in the time of blacksmiths knew more than we do about smithing, but they still wouldn’t have learned the skills required to be a blacksmith on their own. Before you had any chance of being a blacksmith, you had to learn how to be a blacksmith, and to learn how to be a blacksmith, you had to have access to a teacher who had all of the required materials to be a successful blacksmith.
3. A Production Location
Otherwise known as a shop. Without a place to process your raw materials into nails, you would still not have a way to produce your nails.
4. A Means to Market
For you to run a successful business, there must be people willing to buy your nails. Since the product you make consumes resources, it’s not as if you could stock your shelves with stuff people aren’t buying, because it costs you something tangible to make it.
Note here that I say means to market, and I mean that very broadly. As long as you could get your nails to people who wanted them, you’d be okay. It would be better if you had direct access to those people – for instance, by having your shop in their vicinity – since that would allow you more profit due to not having to pay someone else to transport nails for you (or pay for yourself to get to where your buyers were), but as long as you could get your product in front of people who needed it for less than the cost of producing and shipping your product to them, you’d be able to make a profit.
Having all of these ingredients was a necessary part of starting an entrepreneurial endeavor, but it wasn’t sufficient to be successful at it. To be a successful blacksmith, you had to create products to sell. That meant spending time battling the heat of the forge and the fatigue of striking metal all day.
Emerging Industrial Capitalism and Creative Work
At some point, a few people figured out that it was far more productive to consolidate the creation of items into ever larger locations. Having one blacksmith create discrete items in discrete locations was incredibly inefficient; it was far better to have five blacksmiths in one location making five different items. It was even better to have the blacksmiths work on different parts of the same item, since each blacksmith would then only have to know how to make one piece of the item and they could become particularly adept at making that one piece. And if they could bring in other people to acquire the resources they needed, and to fuel their fires, and to sell their products, then they could focus on creating that one piece.
Of course, this wasn’t happening just to blacksmiths – it was happening to every trade. The creators were increasingly removed from the people they created items for and were increasingly specialized, with the result that they worked on smaller and smaller pieces of the final product and knew less and less of the full process of creating that product. The knowledge of how to create the product was reserved for engineers and supervisors who didn’t actually make the product.
Where there was once a single blacksmith, perhaps with apprentices who learned the full art of smithing, there were increasingly larger teams of people that focused on one aspect or the other of the creative process. And creatives began to accept that their role was to learn the skills to be employable by someone else rather than learn the skills to employ themselves and start their own ventures.
Things changed yet again once we mechanized the process of creating items. We removed ourselves from the actual creative processes and instead pushed buttons and pulled levers on machines, while other people supervised the pushing of buttons and pulling of levers.
The advent of computers and computing technology made it such that, in addition to making physical products, we could also create digital products. But, until the last few decades, it was expensive to create digital products, so digital creators were employed by large institutions such as corporations, academia, or the government. We swapped out the factory floor for the cubicled room and that’s about it. People still pushed buttons on small parts of the process, and others ensured that they pushed those buttons. Yet another set of people sold the finished product, and those people had little interaction with the people who created the product, and the people who created the product had little interaction with the people who bought the product.
Notice the trend here: the creative person has been increasingly removed from both what she’s created and whom she’s selling to. To be creative in this context is to focus on increasingly smaller tasks and to play your part in the larger creative structure that you’re a part of. Most disturbingly, loving what you’re making is difficult and not necessary, since you’re seeing only a small part of the product and you don’t get to see the effect it has on the people who get the product, and what matters is not how much you love the product but how well you’re able to channel your creativity in a way that benefits your employer. Loving your work does have a positive effect on your ability to produce, but the love is valuable only inasmuch as it helps you produce and continue working for that employer.
Another interesting trend here is that there were certain types of creative work that were less susceptible to aggregation than others. The “trades” were very quickly subsumed in emerging industrial capitalism since they were practical (i.e., easily sellable) and easily reproducible (once you figured out how to make a nail with a machine, your effort was then focused on resources, labor, and distribution instead of creation). The humanistic creative skills (visual art, drama, music, writing, etc.) were neither practical nor easily reproducible, so remained safe for a few hundred years; yet even these skills were aggregated first within academia and, later, in studios, labels, and literary and performing arts agencies, which evolved along with the technology that made sharing the creative products easier.
The end result of all this is that “making it” in almost any creative endeavor meant getting picked up by people who employed you (corporate life or academia) or who sponsored/controlled your career (studios, labels, and agencies). And in both cases, you had to be profitable. Additionally, we divorced entrepreneurialism from creative work to the degree that we, as a society, funneled “budding entrepreneurs” down one opportunity track and “budding creatives” down another; budding entrepreneurs learned the skills required to run successful businesses, but were focused on profits and numbers, and budding creatives learned the skills required to be a successful creative, but didn’t learn how to sell their creative skills.
Coming Back Full Circle
I listed four ingredients above that governed a creative entrepreneur’s ability to run a successful business. Industrial capitalism controlled the means to production, the production location, and the means to market, and as we moved to producing digital products, raw materials changed from physical materials to personal characteristics.
What the maturing of Internet commerce has done is remove the high barrier of entry for creative entrepreneurialism. Let’s take a look at this:
1. Raw Materials
If you create physical stuff – whether it be handspun yarn, music, or art – you still need raw materials. The conditions are such, though, that most of the raw materials are fairly cheap.
If you create ideas and digital products – yes, ideas count as creations – then your raw materials are … your ability to come up with great ideas. This is why learning to leverage your creativity is so important.
2. The Means to Production
This category is still split into tools and skills. It so happens, though, that for most creative people, the tools – computers, software, Internet connection – are readily available and a near ubiquitous part of modern life. For creative people who make physical stuff, this is still more challenging, but usually, tools aren’t the limiting fact – for all types of creative people, skills are the limiting factor.
I’m going to lump skills and the traits listed under the E-Factor as human capital; I’m lumping skills and traits together because it takes both to be successful. Many people are very, very skilled, but don’t have the traits required to be successful creative entrepreneurs; likewise, there are many people who have the traits, but lack the creative skills to be successful. Ironically, it’s human capital that is becoming ever more rare, yet this is not surprising when you think about what traits and skills industrial capitalism selects for.
3. A Production Location
Creatives who create physical products still have this limitation, but the cost of additional rooms for creation studios is such that it’s not prohibitive; granted, if you live in New York or L.A., you’re much more constrained than if you live in Lincoln, NE, just by the fact that the cost of finished living spaces in those two towns is particularly high.
Creatives who create ideas have a distinct advantage here, in that their production location is right in their laps – literally. Laptop computers are now powerful and sophisticated enough that almost anyone can do their creative work on a laptop. Your production location can be where you live.
4. The Means to Market
If any one thing has changed significantly so as to make creative entrepreneurialism viable, this is it. Instead of having indirect access to the market, as we did under industrial capitalism, you now have direct access to the market with a click of a button. A webpage, properly optimized, hits Google and the search directories within 24 hours, which means that within 24 hours of your putting something up, one person can find it and buy it. And the cost of getting that one buyer is zero or very close to it, assuming that you’re not running advertisements for that product.
Most of us take this for granted nowadays, but it really is hard to overstate the significance of having direct access to a market of roughly 4 billion people (and growing every day) from the comfort of your own home. No longer do you have to pay for radio, television, or magazine space to show your wares to the world.
Notice what has come back full circle here: the creative’s task is once again to create and sell their products to the people who want those products. The new barrier to entry to creative entrepreneurialism is not the land, capital, and labor factors that were once present, but is instead human capital.
The Human Constraint
The four factors that I’ve listed above were an extension of the classic factors of the economics of land, labor, and capital. While it was useful for examining the factors for industrial capitalist entrepreneurs, for the most part, it’s an antiquated model that doesn’t seem to resonate with the constraints creative entrepreneurs actually feel. I’m going to take a stab at a re-categorization here.
It seems that there are four factors or constraints that come up often when we’re discussing the difficulties of doing what we’re wanting to do. The factors are interrelated, and some can be exchanged. They are:
The explosion of productivity and time management literature geared towards individuals gives some indication that many of us believe that if we just had more time, we could do more of the things we want to do. Additionally, we understand that time is one of our most valuable resources, so we’ll often exchange our money or skills to get more time, or we’ll spend time to gain more money or skills.
Many of us are aware of the role money plays in our ability to do what we want to do. Firstly, it’s one of the first things people list as a reason they can’t do what they want to, since either they don’t have the money to do those things or they’re scared that they won’t make enough money doing what they love. Secondly, we’re aware of the fact that we can exchange money for time or skills, either by outsourcing or by investing money into our own education and development.
Very much related to, but distinct from, time is focus. Having ample time or money does us no good if we’re doing so many different things that we still can’t focus our resources on a few endeavors rather than spreading them all out.
In an economic world where the barriers to entry are so low, one of the things that will make the biggest difference between those who are successful and those who aren’t is how skilled the contestants are. If you’re a top-notch writer to start with, you’re more likely to be able to become a really successful blogger (assuming you can either adjust to the different standards of web writing or hang in there long enough that people show up because of the way you write) than if you were a struggling writer to start with. Skill and compassion are what makes people like Pam and Naomi so influential – they’re a rare breed.
As I mentioned last time, you can have each of these elements in spades and still not make it as a creative entrepreneur if you don’t have the E-Factor, but I didn’t want to list it in the elements above because it’s not something that can be exchanged. If you’re trying to exchange one of the four elements above for the E-Factor, you’ve put the cart before the horse.
Each of the above elements is relevant because they enable you to do two important things: create products and get those products to people who want them. The more you gain of each of the elements, the better able you are to create and sell remarkable products; and, though they are exchangeable, the less you have of each element, the less you’re able to create and sell remarkable products.
You Gotta Make Nails
While I’ve discussed what’s changed and what has come back, I’d like to end this post by talking about what hasn’t changed.
Let’s imagine that one of your fellow nail blacksmiths walked up to you and started talking about having difficulty selling his wares. After a few moments of discussion, he reveals that he hasn’t actually been smithing anything at all.
“Do you have the ore to produce your nails?”
“Do you have your smithing equipment?”
“Do you have a shop?”
“Do people want your nails?”
“Then why aren’t you making nails?”
“I’ve got smither’s block.”
Obviously, if your compatriot wants to sell nails, he has to make some nails. It’s not like they make themselves.
The reason I chose a blacksmith as the example trade for this post is because blacksmiths dealt in tangible items. They consumed physical stuff to make physical stuff in a physical location and sold that physical stuff to people they physically saw. It seems easy enough to see that they made their living by making stuff and getting that stuff to people who wanted or needed it.
At the root of it, present-day creative entrepreneurs are really not that much different in this respect. If you’re a writer, you sell an amalgam of words tempered by the fire of your intelligence and steady focus of your concentration, in much the same way as a blacksmith sells mixtures of metal tempered by the fire of their forge and the steady blow of their hammer. Painters use the raw materials of color, texture, and space to produce physical likenesses of the ideas in their heads. And so it is with creatives in every field, including programmers, who use the building blocks of their programming languages to make new programs that execute the ideas they have in their heads.
In other words, we still make stuff, and we have to get that stuff to people who want it. Even if – perhaps especially if – your creative skill is generating ideas, you still have to get those ideas to people who want them if you’re in the business of selling ideas. It’s not like they make themselves.
The world has changed, but the necessity of creatives to create hasn’t. In a world with so many choices and so many things to do, you very rarely can go wrong by creating something awesome.
But the traits required to be proactively creative are different than the ones required to be successful in a world where you’re supposed to do what you’re told. In the next post in this series, we’ll look at the traits you’ll need to develop to be successful in this brave, new again world.
Jason D Barr says
Thanks for this, Charlie. Your clear description of how to update an antiquated economic paradigm is really helpful, especially for those of us in traditional jobs. I notice often in my company that recognition of this redefining is slow to occur, if at all. Old processes and “we’ve always done it this way” are tough habits to break.
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Jonathan Mead says
You never cease to dazzle me.
Charlie, will you marry me?
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Excellent. On the “you’ve got to make nails”, I think one of the blocks is that if you think of your product as “ideas” not “writing” there is a disconnect between what you create and what you sell. I see this sometimes with academics. They are doing good research and learning all kinds of things and creating all kinds of knowledge, but they resent the writing part. And then get all upset when their employer judges them on number of articles published in top ranked journals. Well, the knowledge has to get out to other people somehow but they’ve lost that connection. They stop with teh creating knowledge part and forget about the sharing…
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I agree with the conclusion in the end: the necessity to be creative hasn’t changed. It’s reassuring to know that even if priorities and the way we do things change creativity remains a powerful tool.
I am wondering…
Is creativity a scarce resource? Is it like any other skill that you can trade?
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David Dittell says
Wonderful series. You really break down what it takes to put yourself in position to be doing what you want. The smither’s block example, especially, is on point. The only thing I felt missing was an emphasis on this new/old system being better for the consumers who are seeking it out. Whether it’s custom nails for your cart or a new template for your webpage, people want personalization or, at the very least, products that represent who they are and what they are offering. They seek you out not because the “new” model is inherently better than the industrial model, but because it fits the individual consumer better.
Of course, this series is meant for those who produce product/content and not necessarily for those who consume it, so it’s a problem of perspective more than omission, but I think it’s important to point out again how the real winner is not just you, but everyone you serve as well.
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