110201 hku entrepreneurial dimensions creative economy eacea

THE ENTREPRENEURIAL DIMENSIONOF CULTURAL AND CREATIVE INDUSTRIES

ESPECIALLY SMEs

Rene Kooyman1 February 2011

1 feb 2011 rene kooyman

THE CULTURAL AND CREATIVE INDUSTRIES

‘Cultural industries’ are those industries

producing and distributing goods or services

which at the time they are developed

are considered as a specific attribute, use or purpose,

which embody or convey cultural expressions,

irrespective of the commercial value they may have.

They include: film, DVD and video, television and radio, video games, new media, music, books and press, performing arts, visual arts.

‘Creative industries’ are those industries which use culture as an input but whose outputs are mainly functional. They include: architecture, advertising as well as design and fashion.’

UNCTAD Creative Economy report 2008


THE KEA MODEL

NESTA refined modelbased on ‘analysis of sectors rather than creative activities based on individual talent’

Creative service providers:

Design, architecture, new

media, advertising

Creative content producers:

Tv and Radio, Fashion, Games,

Music, Film, Books

Creative experience

providers/creative originals

producers: visual artists,

designer-makers, performers,

opera, ballet, galleries,

museums; music, games


DIFFERENT DIMENSIONS

Cultural and creative industries :

goods or services

which embody or convey cultural expressions,

irrespective of the commercial value they may have.

• Cultural value:• Creative and cultural capital• Fostering territorial identity and cohesion• Participate in the expression of cultural diversity

• Social dimension: • Social identity, integration and distinction• Reinforcing self-confidence of individuals and communities

• Entrepreneurial dimension: the entrepreneur !!!


THE ENTREPRENEURIAL DIMENSION

The occupational perspective

• entrepreneurs own and manage one's own business enterprise

• create value: shifts economic resources• out of an area of lower and • into an area of higher productivity and greater yield

• assuming entrepreneurial risk • engagement in innovative practices• developing new and innovative products; forms of

organization; new markets; new production methods; new sources of supplies and materials


DETERMINANTS OF ENTREPRENEURSHIP

• Regulatory framework: start-up costs, labor costs, etc.• R&D and technology: new inventions, new products or processes• Entrepreneurial capabilities: human and social capital • Culture: entrepreneur‘s behaviour, attitudes, overall effectiveness• Capital and Access to Finance: from early seed funds to stock

markets• Market conditions: public involvement in markets, competition in the

markets, access to foreign markets, procurement regulation, standardisation

• SME’s ???OECD / EUROSTAT 2008


THE NEW SME DEFINITION

Three criteria:

• Staff headcount• Annual turnover

Or:• Balance sheet

turnover

• Nr of enterprises in each category ?


DISTRIBUTION OF ENTERPRISES AMONG INDUSTRIES PER SIZE CLASS

Source:

Eurokleis 2009


Distribution of Enterprises among Industries per size classEurokleis 2010

00,10,20,30,40,50,60,70,80,9

1

250 +

50 - 249

10 - 49

4 - 9

1 - 3


Staff headcount - turnover

o Very small (< 2 milj EUR)o SMEs (2 – 10 m EUR)o Large enterprises:

2006: Cultural Industries BRDo 763.000 taxable employees

Fesel/Söndermann BRD 2009

96 % nr of enterprises 27 % turnover3 % enterprises 32 % turnover

< 1 % nr enterprises 40 % turnover

o 210.000 Free-lance workersnot registered

Creative industries:


DISTRIBUTION OF TOTAL ASSETSEurokleis 2009


BUSINESS CATEGORIES

• Artisan – Designer driven purely by aesthetic

motivation• Solo – Individual designer focused on growth• Creative Partnership – Two creative people• Designer and Business Partner – One creative and

one business partner• Designer and Licensing Partner – Designer under

royalty contract• Designer and Manufacturer – Designer in

contractual agreement with manufacturer• Partnership with Investor – Designer in partnership

with a formal investor

NESTA 2008


FROM THE ENTREPRENEUR’S PERSPECTIVE

From the SMEs perspective, three markets:

• The ‘arts’ field: pure creative work

• Arts related markets:

teaching, arts administration, art management

• Non-arts markets, in order to generate additional income

Personal characteristics and differences:

• Entrepreneurial success

• Professional achievement

• Art creation

• Professional career

personal motivation ?


PERSONALMOTIVATION INENTERPRE- NEURSHIP


SPECIFICITIES OF CCIs Labour market

• Labour market of the CCIs is complex• Thrives on numerous small initiatives• Careerwise a high degree of uncertainty • Non-conventional forms of employment; part-time work,

temporary contracts, self-employment , free-lancers• Multiple job-holdings; combined other sources of income• New type of employer; the ‘entrepreneurial individual’ or

‘entrepreneurial cultural worker’, clusters of entrepreneurs• No longer fits into previously typical patterns of full-time

professions• Diversity in skills acquisition; higher professional training,

vernacular backgrounds, craft industry, any other category


DIFFERENCES PRODUCT CHARACTERISTICS

• Cultural goods have to be set apart; they

express cultural uniqueness and diversity

• Creative inputs and products are abundant

• Hypercompetitive environment

• Knowledge-based and labour-intensive input

• Not ‘simply merchandise’, but express cultural uniqueness and identities

• Experience goods; production and consumption ‘on the spot’

• Product life-cycles are short


CULTURAL BUSINESS MODELLING (CBM)

1. Market for cultural goods both volatile + unpredictable

2. Consumers are often not aware of their tastes; they

discover through repeated experiences in a sequential process of largely unsystematic ‘learning by consuming’

• Creative service providers – traditionally non subsidised• Creative content providers – mostly non subsidised• Creative experiences/original providers ‐ mostly subsidised

Combined Business Modelling:• Product Market Combinations (PMC’s), real estate, merchandising• Sponsoring, matching funds, co-financing, fund-raising• Business angels (mecenat), governmental fascilities, subsidies


CROSS COUNTRYREGULATORY FRAMEWORKS

Source: Eurokleis 2009 Pan European Questionaire


EU COUNTRY SPECIFICS


ENTREPRENEURIAL LIFECYCLE FRAMEWORK


CCIs AS KEY STRATEGIC FACTOR

• CCIs drivers of economical growth (UNCTAD)• Drivers of innovation:

Creativity – Innovation - Design• Flexibility; direct producer/client interaction; meet the

clients needs• CCIs stand at the core of cultural and industrial networks• CCIs and Technological change/digitisation two-way

process• CCIs indispensable at Corporate Identity and Branding • Cultural and Creative Content as independent

economical factor


CHALLENGES

• CCIs are different than other enterprises;differences in size and characteristics;

general policies do not apply• CCIs are either very small (the bulk) or very big (the few)• The very small ones carry a load of administrative

obligations; accounting, legal registration, etc• Financial funds are hard to find; banks/investors do not

trust creatives (especially in times of crises)• Creative firms go through different stages; some of them

want to grow; others do not• Entrepreneurial skills are lacking; career development is

almost lacking recommendations ?


RECOMMENDATIONS

• The specific size and characteristics of

the CCIs should be recognized• Make a distinction between the large

companies and the very small ones• Exempt nano-enterprises from accounting obligations• Launch a pan-european Creative Investment Fund,

create soft-loans , tax-incentives, business-angels• Create targeted support for the different stages of

development (start-ups, growth)• Establish a Creative Economy Learning & Skills network

and Career Development Support

http://cci.hku.nl

http://cci.hku.nl/

http://cci.hku.nl/


QUESTIONS BRUSSELS FEB 3

Question 1:

How to start long term collaboration between CCI’s

and other sectors?

And which factors are important to succeed that collaboration?

Do we need to start with education programs for both sectors?

Or are there other ways to start that collaboration?

Question 2: You wrote the green paper to define the requirements of a truly stimulating creative environment for Europe's CCI's, but I couldn't find a clear list, or check-list, to ensure that the areas of research and development are in progress.

How do you manage this development to ensure a growth in the requirements of this "truly stimulating creative environments for Europe's CCI's"?


Question 3: There are a lot of definitions about the

CCI's. Some based on activities, some based on mission

and some based on copyright requirements.

What is your definition?

And how do you ensure that everyone is working on the same CCI's when the definitions are so divers?

Question 4: In my opinion it is always the best to teach people from a young age to use their values and skills in improving situations.

I believe it would be most effective to teach art managers the values, possibilities and needs that the CCI's require. How do you see this and how could the EU invest in the area of education, with the idea that investing in young art managers will lead to solutions to the questions that are asked in the Green Paper.

I couldn't find a clear list, or check-list, to ensure that the areas of research and development are in progress. How do you manage this development to ensure a growth of CCIs ?


Question 5: What can visual Artists pro-actively do to manage their role of significance on a 'global scale' in perspective of the CCIs and their spill-over effects?

Question 6: Art and culture have a unique capacity to create green jobs... how so?

Question 7: What effects does the reducing of the cultural budgets have on the creative industries and therefore on the fulfillment of the Green paper?

Question 8: Have there been any interesting developments concerning the green paper topics lately?

THE ENTREPRENEURIAL DIMENSIONOF CULTURAL AND CREATIVE INDUSTRIES

ESPECIALLY SMEs

Rene Kooyman1 February 2011

Creative Industriesas key strategic sector

[email protected]

110201 hku entrepreneurial dimensions creative economy eacea

Business

cultural value

creative activities

cultural expressions

cultural capital

unctad creative economy

commercial value

museums music

visual arts