art business planning
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Protect Your Creative Career with a Business Contingency Plan

Artrepreneur has partnered with [email protected] to produce the Business of Art radio series, an in-depth look at some of the business-centric issues facing artists and the art market. The first installment, a conversation between Jenifer Simon, director of programs and outreach at CERF+, an organization safeguarding artists’ livelihoods nationwide; and Gazem Saka, an artist and senior lecturer in economics at the University of Pennsylvania at the Wharton School, focuses on the importance of creating an artist business plan, which includes contingencies for issues like insurance or emergency relief.

Reshaping the Artist Community through Art Business Education

Dan Loney: There is no question that artists of all kinds provide great qualities to our society, but there is a business side to the art world that sometimes artists may not consider. It includes things like health and life insurance, savings for retirement, recovering from a disaster, and others. So what can be done to try and eliminate this problem in the art world? Jenifer, I guess let’s start at how big a concern is this right now among the artist community and roughly how many artists are you working with right now to really provide these services?

Jenifer Simon: Well after Hurricane Katrina, it became really evident that artists weren’t really represented at the emergency relief table, so a bunch of different arts organizations started a national coalition for artist preparedness and response and that’s when we really got to see artists be affected, especially in Louisiana with jazz artists. We directly help about 50 artists per year with our direct emergency relief financial assistance, but we help hundreds of artists throughout the year with preparedness.

Dan Loney: How does that actually play out? What are the elements that you use to help artists out?

Jenifer Simon: Sure. Well, the first is our emergency relief grant, so an artist can get up to $6,000 within two weeks of submitting their application, so there are direct funds to use as they wish. We don’t prescribe how the funds are used to kind of get them started in their recovery. We also provide training, advocacy, education, our website, the studio protector, and a lot of vetted resources and we’re neutral in that we don’t specify one or the other. We just want artists to be educated and make good choices.

Dan Loney: I guess to a degree when artists reach out to you, there is maybe even a little level of surprise or a lack of understanding in terms of things that they may not have thought about, such as preparedness on a variety of different levels

Jenifer Simon: Absolutely! I’d say the first one is business insurance, so when an artist has a studio fire or an injury and they’re unable to make their work and create a livelihood for themselves to support themselves, if they don’t have business insurance, there’s no coverage for that lost time or to replace equipment, so that’s the number one thing that we see artists not have. It’s inexpensive, it can be done, it’s a protection that all artists should have.

Dan Loney: Gazem, being involved in economics here at Wharton and being an artist yourself, have you seen these types of issues pop up?

Gazem Saka: Yes, absolutely. Especially during the aftermath of the recent recession, the Great Recession. We saw both organizations and individuals looking into revenue generation models, so it’s definitely insurance problems but much more. Artists are more interested in financial solvency and business issues than before. I guess traditionally the artist was seen as the type of person who was aloof. Being unaware of the real world gave them some X-factor, but not anymore because there are more than 2 million artists in the U.S. and they have to survive somehow. According to data, we know that only 40 percent of them will remain as working artists within five years, and only 10 percent of them will persist in the long run, so without an artist business plan, they won’t get to practice their art in the near future and that should be a warning sign.

Dan Loney: I read that some schools- some art schools- are actually incorporating business elements into their normal criteria just to help artists understand that this is something they need to consider.

Gazem Saka: Absolutely. I think every art program in the country should have an art business class for their students. That’s for the students’ benefit, and therefore for our culture’s benefit, because the market is evolving very fast. It’s becoming difficult for artists in the sense that they’re now supplying their labor in an increasingly flexible way, sometimes by the hour or on a per project basis, so they don’t have long term employment. You can think of them as freelancers, and a big portion of them need to work outside the art sector to support themselves, so we are modeling the art world almost like a spot market now. So definitely schools need to get into that within the arts majors, not only with the business program.

An Artist Business Plan Can Help Curb Future Uncertainty

Dan Loney: Jenifer, is having an artist business plan – and I think a lot of people would sit back and say wow, that’s a little bit surprising – but is having just a basic artist business plan or at least one that is kind of formed out a little bit, is that a problem that you see as well with some artists?

Jenifer Simon: I think it’s definitely something that not all art students are getting in the undergraduate or graduate programs because first of all, a lot of faculties don’t feel that it’s their job. They’re there to teach the student about the art form itself, but then there is increasing pressure on career services and alumni to show that the artists are getting jobs and creating for themselves an art business that they can thrive on. So for example, who’s their customer? Knowing their market. What are their costs? What’s their overhead? What should they charge? These are all critical and should be informed decisions, not things that an artist feels vulnerable to quickly answer. It should be planned out and made to be something that they are intentional about.

Dan Loney: Tell us about your organization because in looking at the website, there are a variety of different programs that you run to kind of help artists on a variety of different platforms. I mean obviously, there are the grants that you mentioned, but there’s a learning element to this as well.

Jenifer Simon: Absolutely. I would say studio safety after the unfortunate events of the Ghost Ship in Oakland is a huge, huge issue. Artists are looking for space that’s cheap, that’s in an environment where it’s creative, and that often means that there may not be a lease. The building may not be up to code, so we’re also educating artists to be really informed about the studios that they use our studio safety guide and make sure they’re informed about the space that they’re going to be inhabiting.

Dan Loney: There’s also a variety of concerns, Gazem, over insurance products as Jenifer mentioned. If you have a studio, you need to think about having the proper insurance to be able to cover that space but also to be able to cover the art that you have produced. I think the last thing that any artist wants to have happen is to get a project almost done, have something happen, whether it be a pipe burst or a fire or something, and that art is destroyed and not covered.

Gazem Saka: Exactly. There are so many hidden costs, even when you’re working in your studio you need coverage for your assets. Obviously, your artworks are your assets, but then most artists must handle insurance during transportation of the asset, let’s say to the gallery, and this can be costly due to a higher possibility of damage. When you have an art business, you need insurance for the business liability. Even when you’re working from home, for example, a studio is not officially a residential space, so damage will be covered under your normal domestic policy, which most artists assume otherwise. Or even when you teach an art class, you need public liability insurance, you need business interaction insurance, so many areas you need to cover yourself, and it’s kind of impossible to relate all of this to the students during their tenure in college because the university and public funds cover almost all of these costs for the young artists, so unfortunately there’s this misperception that they can afford a 24/7 studio because they had one at Penn or somewhere else. In addition, they can transport their artwork to the gallery for free and then they don’t have to worry about their public sculpture falling on someone’s foot or something and causing damage because all of that would have been taken care of by the university’s public funds. There are so many hidden insurance problems that artists need to be aware of.

Dan Loney: And one of the prior programs, Jenifer, that you have is called Covering Your A’s: Art Assets and Archives, which I guess to a degree is an offshoot of what we were just talking about there.

Jenifer Simon: Absolutely, and it’s not the traditional professional development practice workshop in terms of marketing and an artist business plan. It’s really about managing risk and identifying what you can least afford to lose, so we talk about documentation and safe storage, artist health and wellness. A lot of artists use repetitive motions and are experiencing issues with their body, so if they have an injury and they’re not ergonomically set up correctly, that could be affecting their ability to make work or make a certain quantity of work. So it’s definitely a space that CERF+ is excited to be because there is such a need, and a lot of universities are paying attention to the studio safety issue because of the issues that have been going on. I would say to artists: The first thing they could do is talk to a financial advisor, especially if you’re leaving school in debt; you don’t have a lot of money to throw around, so you want to be sure you’re using it wisely.

Dan Loney: Going back to the studio space, it’s probably good to get involved with real estate- a good real estate person so that you can find the proper space, but also one that’s reasonably priced that you can afford as well.

Jenifer Simon: Absolutely, which is incredibly difficult because as we all know, artists get priced out of their studios when gentrification happens, but then artists were the ones part of gentrifying it because they helped make it hip and creative and inhabitable, so that’s another problem is where can artists afford to work these days?

Planning for Emergencies and CERF+

Dan Loney: You mentioned Hurricane Katrina and the offshoot of problems that you saw in the wake of that with artists down in New Orleans. With some of the people that you had the opportunity to work with, how have they responded from that disaster? It’s been quite a period of time, yet there are still people down in New Orleans that are still feeling the impact from that storm.

Jenifer Simon: Absolutely. It takes about 10 years for an artist that has had a disaster to truly recover. They’re going to have a new normal. They’re not going to get back to where they were. A lot of artists stayed there because they felt a loyalty to their community to help out. Many artists are a little bit better off in that they know what precautions to take, but still many- I know artists that have had disasters from Hurricane Sandy- they still don’t have art business insurance, so there’s always education to be done.

Dan Loney: I guess the artists that were affected by Superstorm Sandy are still going through that process now.

Jenifer Simon: Absolutely! It takes a long time to build back their studio, to build back their art business.  A lot of artists may have had wholesale orders or commissions that were delayed or canceled as a result. We have one artist in Boulder, Colorado that put his work in a studio for a couple of months while he started a professorship. The studio fire, everything ruined, he’s starting over.

Dan Loney: Gazem, we hear so often how the art world and the artist are truly a community, and when you’re talking about something like this, like this program with CERF+, or just the community dealing with storms, these are people that really need to at times rely on one another, come together and support one another in tough times.

Gazem Saka: Yes. There are artist communities, luckily both online and in real life, where artists support each other and they guide each other about how to pay back the debt and so forth. We also need communities to help artists procure secondary jobs because many of them- about three-quarters of them- will need it, so I’m just looking at very large-scale data here, and the artists on average, they’re more skilled than the general working population. About 60 percent of them hold at least a bachelor’s degree, so they’ll get good secondary jobs and this peer support will become much more crucial, again looking at the very big picture. If we lose the National Endowment for the Arts funding as Trump has proposed for the 2018 budget because the National Endowment sends money to the states who then provide emergency relief for artists, and they try to reach a bigger group of artists by providing smaller funds, so something like $500 could go to an artist as an emergency relief, but if we lose that, that sets us back definitely. So peer support is good, but we do need also organized federal and state support for artists.

artist business plan
Artists should consider what would happen to their business in the wake of an emergency.

Dan Loney: And Jenifer, I’m guessing that in part some of the funding for these grants has to come from the private sector to be able to support these initiatives, correct?

Jenifer Simon: Absolutely. Our organization, CERF+, is pretty unique in that we’re a nonprofit that relies heavily on individual donations. About 70 percent of our contributed income are individual donations – over half of which are artists, so this is really a mutual aid kind of pay-it-forward organization that artists hope they never have to use; but if they do- most artists who receive our assistance will say it’s not so much the dollar amount, although that helps. It’s knowing that somebody cared because artists are very apt to doubt themselves, and so when you’re at your low and somebody gives you that kind of support, their community just raises them up and makes a huge difference.

Dan Loney: The interesting thing in looking at the website is there is a mindset by a lot of people when you think about artists. You mentioned in the wake of Katrina in New Orleans, the jazz community. Jazz musicians were obviously impacted. There’s a variety- I mean you’re based in Vermont. There are quite a few woodworkers that are up in New England that could be impacted by a variety of things, so it’s not just artists. I mean it’s a larger community than probably a lot of people really think about.

Jenifer Simon: Right. We focus on studio artists and artists working in craft disciplines, but you have musicians, you have actors, all of whom studies show that people look to those groups for hope and healing, so artists are the first ones to jump up and help their community when they’re in need, so it’s absolutely something that happens.

Dan Loney: I’m guessing, Gazem, you’ve been in a situation once or twice where you’ve seen an artist that may be in trouble in terms of financially getting their art business off the ground and probably have tried to step in and help that person where you can.

Gazem Saka: Yes. The best thing is to give them a financial plan actually, and many of our students at Wharton have expressed interest in starting an art business, so they may be artists or they may be interested in starting an auction house or a place where art is bought and sold or they want to start a virtual space where people can see concerts, etc. So as you mentioned before, art is a more general category than we assume, so we only think about fine art when we think about art, but both the Labor Department here in the U.S. and the National Endowment for the Arts have a very wide category that includes architects and artists, authors, dancers, designers, etc., so it’s a big- it’s a big business. One thing that we can do is to facilitate the private funding to channel the artists. The problem there is to get a wide variety, so the one problem with the market is that about 50 percent of the individual’s gifts and grants go to the top two percent of institutions, so what we need is to give more equally to people especially who are not living in large cities.

Dan Loney: So is this something not only art schools should really consider, but maybe even partnerships with other colleges and institutions to be able to try and provide this information as a class so that artists can really gain this information going forward?

Gazem Saka: Exactly. Not only artists but whoever wants to work in an art-related profession.  You could be a dealer. You could be a gallery owner. You need to have the business aspect of it done.

Jenifer Simon: Yeah, we’re really talking about the creative economy, and there are a lot of great art programs there that are creating entrepreneur or “artrepreneur” programs where it is very much business and art. They want like Gazem was saying, artists that are fully aware of what they’re getting into, and there are a lot of savvy artists that are in incubators and social enterprise or social justice that are getting funding and are really smart about what they need to do. They’re not playing the victim. They kind of know that they’re not going to make a living off of their art, per se.

Dan Loney: I guess as you kind of alluded to Jenifer, it becomes even more important now with the way that the economy has kind of shifted and more people deciding that they don’t want to work the traditional 9 to 5 in-office type job, they want to be out and working on their own. It could be an artist, it could be an Uber driver, it could be a variety of different things.

Jenifer Simon: Yeah, there was a big article I think in the Harvard Business Review a while ago about the MFA’s new MBA, and how Facebook has artists in residence and Google has artists in residence and the mix between the two in terms of creativity is really something that’s evident right now, and each can learn so much from the other.

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About the author

Nicole Martinez

Nicole is a veteran arts and culture journalist. Her work has appeared in Reuters, VICE, Hyperallergic, Univision, and more.

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