[Note: This is an excerpt from my book, Creative Freedom: How To Own Your Dreams Without Selling Your Soul, that's coming out later this year. If you haven't already, take the quiz to determine your creative type. Be sure to get on the notification list to stay up to date on the book's release date!]
One of the conversations I have pretty regularly with people is around what it means to be a creative entrepreneur. Contrary to what you might think, it has nothing to do with what or how you create. Everyone is creative in some way. EVERYONE. The indicator, then is whether or not you choose to be an entrepreneur around your Great Work.
Not all creatives are entrepreneurs, and that’s okay. Elizabeth Gilbert wasn’t a creative entrepreneur when she wrote “Eat, Pray, Love” and her work impacted millions around the world. She also made some pretty good money, I’d be willing to bet, or she’d never have quit her day job. But you don't have to make good money to be a creative entrepreneur - in fact, you might not make any money when you start.
So how do you know for sure? Here are five signs that you’re not a creative entrepreneur:
For the purposes of this book, if you create as a hobbyist, or for side income and don’t ever plan to make it your primary source of income, you’re not a creative entrepreneur. It doesn’t matter if your Great Work is sculpture, business analysis, architecture, or video game walk-throughs on YouTube. The type of creativity you express has nothing to do with whether or not you’re a creative entrepreneur. It’s your intention around that creation that matters.
As a creative, you can create for yourself and not care what anyone else thinks about your work. As a creative entrepreneur, you have to listen to your audience and respond to their changing needs. That doesn’t mean you can’t create for yourself and your own enjoyment, but it does mean you have to have clarity around what elements of your Great Work will respond to the fluctuations of the market. Jim Henson did a lot of commercial work to have the money he needed to be able to make movies like Labyrinth and The Dark Crystal. He had his own “shrine to the almighty dollar” as a reminder that you can’t make art unless you have the money to do so. Money is freedom for a creative. It gives you the ability to do what you want without having to bear the criticism of others.
Are you creating for a specific audience? Did you establish a legal structure for your business? Are you reporting income and paying taxes? Are you actively marketing your Great Work in the world? If so, then you’re probably a creative entrepreneur, even if you’re just getting started in “jobby” mode (a hobby disguised as a business). If your aim is to make this a going concern, and you’re focused on growing your company as a business owner, you’re most likely a creative entrepreneur. You might not have a profitable business yet, but you’ve got the creative entrepreneur spirit that is needed to grow.
Thomas Edison devoted himself entirely to business. According to author and archivist, Leonard DeGraaf, Edison “vowed he would not invent a technology that didn’t have an apparent market; that he wasn’t just going to invent things for the sake of inventing them but… to be able to sell them.”
Edison himself is quoted as saying “All my life, I’ve been a commercial inventor. I have never dabbled in anything that was not useful.”
Edison was very clearly a creative entrepreneur. If you are actively trying to serve a particular market, sharing your gifts with them, and making sales offers to them, you are also a creative entrepreneur.
Income and expenses. Cash flow. Profit. Do you have your finger on the pulse of what your business is actually doing? Chaotics struggle with this sometimes, because they have an aversion to numbers and structures in general.
In her autobiography, Put On Your Crown, Queen Latifah tells how, due to a clerical error that went unchecked, all her money was out of whack. She was scrambling to pay bills not because anyone was intentionally trying to screw her, but because she stuck her head in the sand and didn’t pay any attention to the numbers.
Latifah then revealed a secret she learned from an episode of Oprah: “always sign the checks.” This was a simple way for her to keep a finger on the pulse of her business.
By reviewing your numbers consistently - even if they’re not where you want them to be - you keep yourself in the know. And knowledge is power.
This is another sign of creating a jobby for yourself, by the way. Each of the type can suffer from this issue for different reasons. Chaotics don’t trust that other people will rise to their (impossibly) high standards. Fusions are so used to doing everything themselves that it feels painful to slow down long enough to get or train help. Linears will micromanage deadlines and budgets, which tends to drive people away.
At some point, if you’re growing a business, you’ll have to ask for and accept help from others who may not do things exactly the way you would. Like when I ask my son to clean his room, it may not be clean the way I would do it, but it meets my criteria for a clean room. If I don’t want to be stuck doing all the cleaning, I have to be willing to let go of the trivial things - like how he folds his socks. So long as the clean clothes fit in the dresser, I’m happy.
That doesn’t mean compromising on what really matters, but chances are good you’re worrying about more than you need to at this early stage in your business growth. Nobody expects a young business to deliver at the same level as a fortune 500 company. Use that to your advantage to surprise and delight your audience - but don’t let it keep you from delivering at all because you’re too mired in doing ALL THE THINGS!
To be clear, EVERYONE is creative in some way. It could be the way you solve a problem or spot patterns, it could be the way you dress up a gift bag with ribbons or paint. The fact that you use your imagination to see or bring something to life that wasn’t there before makes you a creator and therefore a creative.
Entrepreneurs are especially adept at seeing a need and creating something to fill it, but not all creatives are entrepreneurs. The dictionary definition of “entrepreneur” is someone who takes on a “greater than normal financial risk” to organize or operate a business.
Many creatives I know don’t want more risk, they want stability. They’re freaked out by the notion of the starving artist. Like Gilbert, they’re content to rely on their day job and dabble in their creative work during their hobby time. If that’s you, then you don’t need this book.
On the other hand, if you’re ready to make a transition plan from the day job, if you’re already knee-deep in your creative work and need some clarity and direction to make it a profitable and sustainable business, then you’re in the right place.
I developed the Creative Freedom Entrepreneur Type Spectrum to give creative entrepreneurs the clarity they need about how to best set up and run their business - in a way that works with their unique quirks and traits. You’ll get clear on how to use the ninja skills of your specific type to make your business more productive and profitable, and how to clear up your blind spots so you don’t end up stuck like I was, doing things that will only make you miserable.
Does it take longer or more effort to build a business doing something you love? That depends on you. But my experience and that of my clients shows that it’s worth it. You’re building a long-term asset instead of looking for short-term “low-hanging fruit”. And it’s often easier because your efforts are bolstered by the fact that you’re doing something you love, instead of something you dread.
Here's the replay from my Facebook Live on the topic:
Creative Freedom Live
Predictable Success by Les McKeown
[Note: This is an excerpt from my book "Creative Freedom: A comprehensive guide to personal and financial freedom as a creative entrepreneur". If you'd like to be the first to get updates and excerpts, make sure you're on my mailing list, so you don't miss a beat!]
Suppose you saw this "advertisement" on social media. You'd no doubt roll your eyes, scratch your head, and maybe even wonder aloud "Who do they think they are? Beyonce is like The Highlander... there can be only one!"
The Highlander franchise might belie that notion, but I digress.
Regardless, you'd likely consider this ad complete nonsense and skip right on past - no matter how badly you'd like to be the next Queen Bey.
And yet, how many times have you been lured by other similar, yet equally absurd promises?
Depending on the circles in which you travel, you may have mixed emotions about the phrase "earn six-figures a year." After all, earning six or seven figures is the holy grail of many online business coaches and so-called internet marketing gurus.
The phrase "earn six-figures" is often followed by such deceptive codswallop as "in your sleep" or "in your pajamas" or "part time from anywhere".
These inflated promises are often found co-mingling with sentences like "all you need is a laptop and a dream."
Puh-lease.
While it's true that some people have done those things, the reality is that very few people can replicate their success - and when they do, success doesn't happen overnight. There's no "blueprint" or "formula" that's going to give you those kinds of results overnight.
I regularly write about the fact that those kinds of results take time. Jeff Walker, developer of Product Launch Formula, said he got fewer than 10 buyers the first time he launched. He had to launch more than once before he hit seven figures. Beyonce only became Beyonce after years of focused effort, a few heartaches, and more focused effort.
The same is true about building your own Noble Empire. You have to keep showing up consistently, iterating, focusing on what works and discarding the rest. That's how you build a reputation and make a good living doing what you love.
But too many creatives settle for subsistence-level income in their so-called business. It's time to stop the madness. (Tweet this)
That's why I am a firm believer that every creative entrepreneur needs (yes, I said needs) to build a six-figure company. I call it the Six-Figure Imperative.
At its core, The Six-Figure Imperative is both a mathematical equation and psychological illustration (Fusion creatives, rejoice!). In most casts, a healthy company needs to make at least six figures in order to pay the owner a living wage and still be able to cover the business expenses. Sure, there are places in the world where you can live on less (or might need more), but that's a fair baseline for most creatives, and I don't know many people aiming to live closer to the poverty level - which, in the US, is just over $20,400 for a family of 3 (higher in Alaska & Hawaii).
All you Chaotics out there, breathe a minute and let's explore these numbers. If you want to pay yourself $50,000 per year (before taxes), your company needs to bring in at least $100,000. That's based on the Profit First approach that I use with all my clients. Developed by Mike Michalowicz, the Profit First approach recommends that owner's pay be half of the company income.
So, $50,000 x 2 = $100,000 business revenue
Special notes: Once your business revenue is over $250,000, your owner pay percentage will shrink, and your profit sharing percentage will grow. If you want your take home pay to be $50,000, you'll need to add your taxes on top of that number before you multiply. I'm no tax pro, so you'll have to do that math on your own, but this gives you a baseline idea of how it works.
Now, all you Linears can sit back for a minute while we cover the psychological illustration. Most creatives see the six figure mark in one of two ways:
The Six Figure Imperative works to break that psychological block by showing you that six figures is not only reasonable, it's important to the long-term health of any full-fledged business.
When I say "six figures" I mean it as a baseline. I hope you're able to make as much money as you desire with your Noble Empire. Eight figures? Go for it. Ten? Why not? More? That's okay by me, too. But for most of us, the low-end of six figures is a useful rule of thumb.
But there's a big gap between $100,000 and a million. Where should your personal baseline be?
If you're living in a major metropolitan area, where rent is obscene, the low end of six figures might not even cover your mortgage. I saw an apartment listed in Nashville for $8,000 per month. And a girl's gotta eat, right? So your six-figure baseline might be closer to $250,000. That puts you owner pay at $125,000 per year. $96k for rent and $31k for all your other living expenses.
Only you can discern what will really work for you. Maybe you have no kids, or maybe you have seven. Maybe you have no debt, or maybe you've got thousands of dollars in student loans that still need to be paid off. Once you determine your living wage, you'll be able to determine the baseline income goal for your personal Six-Figure Imperative (and also helps you make the six-figure distinction).
There's one last clarification I need to make. The Six-Figure Imperative applies to full-fledged businesses. If you're a creative entrepreneur with a "side hustle" or a hobby that happens to earn some income, this may not apply to you. Creative Freedom is focused on helping creative entrepreneurs build a full-fledged business that's healthy, profitable, and sustainable. The Six Figure Imperative is meant for any Noble Empire that's designed to pay you a living wage and stand on its own. That means you don't need to prop it up by pumping your own money into it all the time, and you're not running it down to zero to keep your personal bills paid. You don't need a job to keep it afloat because it swims on its own.
That doesn't mean that your hobby can't make six figures. It doesn't mean you have to quit your day job to do what you love. There are many stories of creatives that have a day job that pays the bills so that they can create on their own terms. Jim Henson started life that way. But at some point, he decided that being a creative entrepreneur was his path, and he built a company that paid him well - and was able to feed and clothe an army of employees to boot. You dream may not be as grand as Henson's was, but The Six-Figure Imperative can help set you on the path for healthy growth, whatever size your company may be.
===
If you're ready to set your own Six-Figure Imperative, and grow your creative business in a sustainable way, the doors are open to my new Portable Coaching program. If you need start up money, we recommend qvcredit as our legal money lender Singapore. They are tuned in for tech and innovation start ups. Designed for creative entrepreneurs in the start-up phase of growth, Portable Coaching is an easy, affordable way to get the help you need to grow your business. Beyond early start-up? I also have two openings for one-on-one advising. These spots fill fast, so check it out today if you're curious!